HomeMy WebLinkAboutC2005-752 - 11/14/2005 - NAMEMORANDUM OF AGREEMENT
THIS MEMORANDUM OF AGREEMENT (this "Agreement ") is made and entered
into by the Four Star Scholarship Corporation a Texas not -for- profit corporation and NRP
Holdings LLC, an Ohio limited liability company ( "NRP "), as of the 10 day of February, 2005.
WHEREAS, Four Star Scholarship Corporation and NRP have agreed to work together
to apply for funding to develop of affordable housing in Corpus Christi, Texas;
WHEREAS, such funding shall be in the form of 4% low- income housing tax credits
( "Tax Credits "), which may be combined with tax- exempt bonds ('Bonds "); and other gap
financing such as City of Corpus Christi HOME funds (HOME Funds)
WHEREAS, Four Star Scholarship Corporation and NRP wish to set forth the terms and
conditions on which they will pursue such projects.
NOW, THEREFORE, on the basis of the mutual covenants set forth herein and for
other valuable consideration, the sufficiency and receipt of which are hereby acknowledged, it is
agreed as follows:
1. The Project Four Star Scholarship Corporation and NRP have agreed to work
together to apply for financing for the following project in Corpus Christi, Texas:
(a) The Villas at Costa Tarragona I
( "Tarragona I")
(b) The Villas at Costa Tarragona II
( "Tarragona IP')
250 units for families
if financed with Bonds and
4% Tax Credits
250 units for families
if financed with Bonds and
4% Tax Credits
2. The Applications
(a) The parties have applied for a reservation of Bond allocation from the Texas
Bond Review Board (the "BRB ") for Tarragona I and Tarragona II. The Projects has not
received a reservation as of the date hereof. If the BRB notifies the parties that any of such
Projects will receive a reservation of Bond allocation, NRP shall have the discretion to determine
whether such reservation shall be accepted. If a reservation is accepted, the parties shall proceed
to file an application for an allocation of 4% Tax Credits from the Texas Department of Housing
and Community Affairs ( "TDHCA ") for the applicable Project.
2005 -752
11/14/05
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CCCIC INDEXED,
(b) The parties will file an application for an allocation of Housing Trust Funds from
( "TDHCA ") for Tarragona I and Tarragona II by March 1, 2005. The parties intend to file an
application for Corpus Christi HOME Funds for such projects. If TDHCA notifies the parties
that any of such Projects will receive a commitment of Housing Trust Funds, NRP shall have the
discretion to determine whether such commitment shall be accepted.
(c) If any of Tarragona I or Tarragona II receives notice that such Project will receive
a reservation of Bond allocation and a commitment of 4% Tax Credits, NRP shall have the
discretion to determine if financing will be utilized.
3. The Ownership It is anticipated that each Project will be owned by a Texas
limited partnership (collectively, the "Partnerships ") as follows:
(a) Tarragona I . Tarragona I will be owned by Costa Tarragona I, Ltd.,
( "Tarragona I Partnership "). The general partner of Tarragona I Partnership will be Four Star
Scholarship Corporation Costa Tarragona I, LLC, a Texas limited liability company
( "Tarragona I GP ") wholly owned by Costa Tarragona I, Ltd.. The special limited partner of
Tarragona I Partnership will be NRP Costa Tarragona .1, LLC an Ohio limited liability company.
(b) Tarragona II . Tarragona II will be owned by Costa Tarragona II, Ltd.,
( "Tarragona U Partnership "). The general partner of Tarragona II Partnership will be Four
Star Scholarship Corporation Costa Tarragona II, LLC, a Texas limited liability company
( "Tarragona II GP ") wholly owned by Costa Tarragona II, Ltd.. The special limited partner of
Tarragona II Partnership will be NRP Costa Tarragona II, LLC an Ohio limited liability
company.
To the extent that .Tarragona I or Tarragona II receives a reservation of Bond allocation
and decides to proceed with such financing, and to the extent that the application with the BRB
reflects an ownership structure different than that described above, the parties shall advise the
BRB of the change in ownership structure and proceed with the financing using the ownership
structure described above.
4. Developer It is anticipated that the developer of each Project will be as
follows:
(a) Tarragona I Four Star Scholarship Corporation ( "Costa Tarragona I, Ltd.
Developer "), will be the developer of Tarragona 1. NRP will be the Co- Developer (as such term
is defined in TDHCA's 2005 Qualified Allocation Plan (the "QAP" )).
(b)' Tarragona II Four Star Scholarship Corporation ( "Costa Tarragona II, Ltd.
Developer"), will be the developer of Tarragona 1. NRP will be the Co- Developer (as such term
is defined in TDHCA's 2005 Qualified Allocation Plan (the "QAP ")).
To the extent that if Tarragona I or Tarragona II receives a reservation of Bond allocation
and decides to proceed with such financing, and to tht extent the application with the BRB
reflects a developer structure different from that descried above, the parties shall advise the BRB
PROJECT AGREEMENT - PAGE 2
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of the change in developer structure and proceed with the financing using the developer structure.
described above.
5. Management To the extent any of the Partnerships proceeds with the
development and ownership of a Project, NRP Management LLC, an Ohio limited liability
company, which is an affiliate of NRP (the "Management Company "), will provide the
property management services for such Project pursuant to a management agreement to be
entered into between the Management Company and the applicable Partnership.
b. Construction To the extent any of the Partnerships proceeds with the
development and ownership of a Project, NRP Contractors LLC, an Ohio limited liability
company which is an affiliate of NRP (the "Contractor "), will serve as the general contractor for
such Project pursuant to a construction contract to be entered into between the Contractor and the
applicable Partnership.
7. SMportiye Services To the extent any of the Partnerships proceeds with the
development and ownership of a Project, Four Star Scholarship Corporation will provide
supportive services for the tenants of such Project pursuant to a supportive services agreement to .
be entered into between Four Star Scholarship Corporation and the applicable Partnership.
8. Representations and Warranties by Four Star Scholarship Corporation Four Star
Scholarship Corporation hereby represents and warrants to NRP as follows, which
representations and warranties shall survive the consummation of the transactions contemplated
hereby:
(a) Four Star Scholarship Corporation is a nonprofit corporation duly organized,
validly existing and in good standing under the laws of the State of Texas; it has the corporate
power and authority to carry on its business as it is now being conducted; it has the power and
authority to enter into and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby; and neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated hereby will constitute a violation of, be in
conflict with or constitute a default under the governing documents of Four Star Scholarship
Corporation or any agreement or instrument to which it may be a party.
(b) This Agreement has been duly executed and delivered and authorized by all
appropriate corporate action.
9. Representations and Warranties by NRP NRP hereby represents and warrants to
Four Star Scholarship Corporation as follows, which representations and warranties shall survive
the consummation of the transactions contemplated hereby:
(a) NRP is a limited liability company duly organized, validly existing and in good
standing under the laws of the State of Ohio; NRP has limited liability company power and
authority to carry on its business as it is now being conducted and to enter into and perform its
obligations under this Agreement and to consummate the transactions contemplated hereby; and
neither the execution and delivery of this Agreement nor the consummation of the transactions
PROJECT AGREEMENT - PAGE 3
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contemplated hereby will constitute a violation of, be in conflict with or constitute a default
under the governing documents of NRP or any agreement or instrument to which it is a parry..
(b) This Agreement has been duly executed and delivered and authorized by all
appropriate limited liability company action of NRP.
10. Miscellaneous
(a) The parties agree to execute such documents and do such things as may be
necessary or appropriate to facilitate the consummation of their agreements herein.
(b) The parties acknowledge that each of them has been represented by counsel with
respect to the preparation of this Agreement and has adequate experience to evaluate the
ramifications of the provisions of this Agreement. In the event of a question as to. interpretation
of any provision of this Agreement, the provision shall not be construed against the drafting
Party.
(c) This Agreement shall continue until terminated upon the earlier to occur of June
30, 2006 or written consent of Four Star Scholarship Corporation and NRP.
(d) This Agreement shall be binding upon and inure to the benefit of each party and
to anyone who lawfully succeeds to the rights or takes the place of any party hereto; provided,
however, that neither party may assign its responsibilities hereunder to any other party without
the prior written consent of the other parties. This Agreement is not merely an "agreement to
agree."
(e) This Agreement embodies the entire agreement between the parties and
supercedes any prior contemporaneous agreements, representations and undertakings between
the parties with respect to the subject matter hereof and may be changed only by an agreement in
writing signed by each of the parties hereto.
(f) This Agreement may be executed in several counterparts, each of which shall be
deemed to be an original copy and all of which together shall constitute one agreement binding
on all parties hereto, notwithstanding that all the parties shall not have signed the same
counterpart.
(g) THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF TEXAS, EXCLUSIVE
OF CONFLICT OF LAWS PRINCIPLES.
(h) In case any one or more of the provisions contained in this Agreement for any
reason are held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability will not affect any other provision hereof, and this Agreement will be construed
as if such invalid, illegal or unenforceable provision had never been contained herein.
(i) The parties hereto submit exclusively to the jurisdiction of the state and federal
courts - of Nueces County, Texas, and venue for any cause of action arising hereunder shall lie .
exclusively in the state and federal courts of Nueces County, Texas.
PROJECT AGREEMENT --- PAGE 4
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0) Should any party employ an attorney or attorneys to enforce any of the provisions
hereof, to protect its interest in any manner arising under this Agreement, or to recover damages
for the breach of this Agreement, the non- prevailing party in any action pursued in courts of
competent jurisdiction (the finality of which is not legally contested) agrees to pay to the
prevailing party all reasonable costs; damages and expenses, including specifically, but without
implied limitation, attorneys' fees, expended or incurred by the prevailing party in connection
therewith.
(k) The subject headings contained in this Agreement are for reference purposes only
and do not affect in any way the meaning or interpretation hereof.
(1) All notices or other communications required or permitted to be given pursuant to
this Agreement must be in writing and will be deemed served and given at the time of (i) three
(3) business days after deposit in a depository receptacle under the care and custody of the
United States Postal Service, properly addressed to . the designated address of the addressee as set
forth below, postage prepaid, registered or certified mail with return receipt requested, (ii)
delivery to the designated address of the addressee set forth below by a third party commercial
delivery service, whether by overnight delivery or by courier, or (iii) receipt at the facsimile
receiving facility of the addressee if transmitted by facsimile transmission. Notice given in any
other manner will be effective only if and when received by the addressee. For purposes of
notices, the addresses, and facsimile number of the parties are as follows:
FSSC: Four Star Scholarship Corporation.:
1038 Pyramid Dr.
Corpus Christi, Texas 78412
NRP: NRP Holdings LLC
5309 Transportation Boulevard
Cleveland, OH 44125
Attention: I David Heller
Fax No.: 216 - 475 -6101
Any party has the right to change its address for notice hereunder to any other location within the
continental United States by giving notice to the other party of such new address *at least thirty
(30) days prior to the effective date of such new address.
PROJECT AGREEMENT - PAGE 5
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SIGNATURE PAGE
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
FSSC:
NRP:
Four Star Scholarship C oration
By 4--
N me: tor Vera
Title: ized Representative
..
0
PROJECT AGREEMENT- PAGE 6
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Attachment 11LB
51! • M (Exhibit III.A) Four Star Scholarship Corporation (FSSC):
FSSC will be the General Partner and serve as the developer for this project. FSSC and
its parent organization, LULAC #4444, are run by Executive Director, Nancy Vera and
their committed Board of Members. All events, services and day to day activities are
handled by a network of caring volunteers who are managed by Nancy. - Should
Tarragona 11 be funded the project will guarantee development fees for the organization,
allowing them to hire staff as needed to carry out extra duties that would result from the
project.
! = • (Exhibit IILB) NRP Holdings LLC (NRP) & Affiliates
NRP will serve as a co- developer to this project and will handle the project's
development and accounting. NRP has developed and constructed over 90 low- income
housing tax credits, 6 with mortgage revenue bonds. NPR's development team for Texas
includes vice president of development, two project managers, one assistant project
manager, one administrative assistant with access to two application specialists and a
financial analyst. NRP operates at a satellite office in San Antonio from which a
developer project manager, construction and property management staff work. NRP
principals have developed approximately 10,000 apartment units, 2,500 homes, 1,000
condominiums, and over two million square feet of retail space. NRP principals have a
combined seventy -five (75) years of housing and real estate development experience.
NRP has an accounting staff of 1.4 people that includes 6 degreed accountants (3 of which
are CPA's).
In cooperation with The Four Star Scholarship Corporation and NRP Management LLC
(NRP Management) NRP will provide the due diligence and administrative support
necessary to perform all development activities and to close the project's financing
including the City of Corpus Christi HOME loan.
Additionally NRP's other affiliates will bring capacity & experience to the project:
: (Exhibit 11LB) NRP Contractors LLC (NRP. Contractors)
NRP Contractors is capable of providing a broad range of services to meet your
construction needs. From start to finish, every project is carefully contemplated and
executed to maximize cost efficiency, productivity and satisfaction. Inherent within our
ability to achieve this is a wealth of individual experience in:
• conceptual estimating
• building construction
• design
• civil engineering
• architecture
• project management
• construction consultation
• general construction
• construction management
• budget development
NRP Contractors has constructed.or in the process of construction over ninety (90) low-
income housing tax credits and 6 mortgage revenue bonds projects in Ohio, Mi - chigan,
Indiana and North Carolina.
• (Exhibit III.C) NRP Management LLC (NRP Mana eg_ment
NRP Management will serve as the property manager for this project.
NRP Management established in 1996 is responsible for property management and asset
management of over 1,000 apartment units. Since inception, NRP Management has
provided detailed directions to third, party management agents in an effort to meet
occupancy goals and maintain the physical and financial integrity of the NRP portfolio.
NRP Management conducts day -to -day reviews and inspections of our assets, in an effort
to ensure that the physical and financial integrity of our properties are maintained and
protected.
NRP Management Team has combined experiences that encompass every aspect of
property management including the opening of new communities, development of
successful in -house marketing programs, preparing specified property social service
programs, maintaining the physical integrity of the asset and commitment to providing
daily supervision and training of on -site employees.
NRP Management has a full time highly experienced and qualified compliance
Department in Texas. Currently NRP Management handles the following compliance
programs (LIHTC, HOME, SHIP, Tax exempt Bonds, SAIL, RTC, AHL, Section 8, and
SRO).
DECLARATION OF RESTRICTIVE. COVENANT
OF AFFORDABILITY
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY
REMOVE OR STRIKE ANY OF THE FOLLOWING INFORMATION FROM THIS INSTRUMENT
BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR
SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
Costa Tarragona. 1, Ltd., makes this declaration of affordability on the 14th day of
November, 2005, to assure the long -term use of the real property described below to provide
decent and affordable residences for low to moderate income residents, as defined in the HOME
Investment Partnerships Program, Final Rule, 24 CFR Part 92.203.
1. Corpus Christi Housing Finance Corporation is the record owner of the real
property located in the City of Corpus Christi, Nueces County, Texas, and as more particularly
described on the attached Exhibit "A;" and which is hereinafter referred to as the "Property."
2. In consideration of the loan of funds by the Corpus Christi Community
Improvement Corporation to Costa Tarragona I, Ltd., for the construction of Two Hundred Fifty
(250) rental units of the Villas of Costa Tarragona (the "Project") which will provide affordable
leased residences, as hereinafter provided Costa Tarragona I, Ltd., hereby agrees to restrict the
use of the Property in the manner and for the period of time set forth herein.
3. For the benefit of itself, the Corpus Christi Community Improvement Corporation,
and the future leased residents of the Project, Villas at Costa Tarragona, its successors and
assigns, do hereby adopt and impose on the Property the following condition, covenant, and
restriction, hereinafter referred to as "restrictive covenant," which shall be a covenant running
with the land and shall be binding upon any purchaser, grantee, owner or lessee of any land or
building on the Property, and their respective heirs, executors, administrators, devisees,
successors, and assigns:
3.1 For a continuous period of twenty (20) years from the date of the
recording of this Declaration of Restrictive Covenant of Affordability in the
Real Property Records of Nueces County, Texas, the Property shall be
used only to provide leased housing for eligible low to moderate income
residents, as defined herein, under all applicable federal statutes,
regulations, and guidelines on applicable to the Property.
3.2 For purposes of this covenant, "persons of low to moderate income" means
individuals or families whose income does not exceed eighty percent (80 %)
of the City of Corpus Christi area median income, adjusted for household
size, as determined by the Secretary of the U.S. Department of Housing
and Urban Development.
d. Every person who now or hereafter owns or acquires any right, title, or interest in
or to any portion of the Property is and .shall be conclusively deemed to have consented and
agreed to every restrictive covenant, whether or not any reference to this declaration is contained
in the instrument by which the Property was conveyed to such person.
5. This Declaration, of Restrictive Covenant of Affordability shall be binding upon
the undersigned party and all successive owners of the Property or any part thereof. Whenever in
this Declaration of Restrictive Covenant of Affordability a reference is made to a parry, such
reference shall be deemed to include a reference to the heirs, executors, legal representatives,
successors and assigns of such party.
ADOPTED this ld day of November, 2005.
Costa Tarragona I, Ltd.
By: CCHFC Costa Tarragona I, LLC, a Texas
limited liability company, its general partner
By: Corpus Christi Housing Finance Corp., a
Texas corporation, its sole member
By: ktA
CK" o ' rVe Noe, General Manager
Attachment
Exhibit "A" — Property Description
(ACKNOWLEDGMENT)
STATE OF TEXAS
COUNTY OF NUECES
This instrument was acknowledged before me on this jj of November, 2005, by
George Noe, the General Manager of the Corpus Christi Housing Finance Corporation, a Texas
housing finance corporation, the sole member of CCHFC Costa Tarragona I,. LLC, a Texas
limited liability company, acting as the general partner of Costa Tarragona I, Ltd., a Texas
limited partnership, on behalf of the partnership.
a ° � F "Y •`•(P JOHN D. BELL .
Notary Public N T Y P LIC, STATE OF TEXAS
y STATE OF TEXAS
My Comm. Exp. 04 -20 -2009
2
Declaration of Restrictive Covenant of Affordability
AFTER RECORDING RETURN TO -
Corpus Christi Community Improvement Corporation
P. O. Box 9277
Corpus Christi, TX 78469
3
Declaration of Restrictive Covenant of Affordability
��i�L`a ILA Y.-•; /;:F ,tv • 'Sri iiY ':Li• G X f T
title of san antonio
EXHIBIT "A"
Field Notes for. a 12.691 sere tract of land Dut of Share G, and being a portion of a 134
acre tract of lard out of Share 8 and G, of the McBnds Partition, said 134.6 acre being I
some property described by Deed • recorded under Volume 94, Page 540, Deed Records of
Nueces County. Texas, said 12.691 acre tract being more fully described by metes and bou
as follows.
Beginning at a 5/8 inch iron rod with a rid plastic cap stamped "Urban Engr C.C. D
set on the west boundary of McBride Lane, a 50.00 foot wider public roadway. for they nor-ft
east corner of Lot 1$9. Ebony Acres No. 2, a mop of which is. recorded in Volume 10, Pal
17, Mop Records of Nueces County, Texas;
Thence, South 88'25'13' West (Plat =South 89 "07'30" West), along the north boundary E
said Ebony Acres, a distance of 1,132.44 feet to a 1 Inch iron pipe found for the south
corner of this • tract;
Thence, North 16"48'09" East, a distance of 166.59 feet to a 1' inch iron pipe found
an interior corner of this tract;
Thence. South 89'28'08" West, a distance of 413.41 feet to a 5/8 inch iron rod with c
red plastic cap stamped *Urban Engr C.C. TX" set an the east boundary of North Padre Isl.
Drive, a public roadway also known as State Highway 358, for the southwest corner of this
tract;
Thence, along the flared right —of —way at the intersection of sold North Padre Island Dr!
and Interstate Highway 37. as follows:
North 10'2.4'37" f=ast, 179.70 feet to a concrete monumant found for c comer of this
tract;
North 15'26'41" East, 94,09 feet to a concrete monument found for a comer of this
tract;
North 22 East, 172.48 feet to a concrete monument found for a corner of this
tract;
North 32'46'14" East, 172.30 feat to a concrete monument found-for a comer of this
tract;
North 42'31'27" East, 172.69 feet to a concrete monument found for a corner of this
tract
North 89'54'39" East, 21,15 feat to a 5/8 Inch iron rod . with a red plastic cop stamped
"Urban Engr C.C. T % set for a comer of -this tract;
Norkh ODr17'30" West 15.71 feet to "a concrete monument found for a canner of this
tract;
North 5-'4918" East, 108zk16 feet to a 5/8 inch iron rod with a red plastic cap stamped
"Urban Engr C.C. TX, edt for the north comer of this tract;
Thance, along the northeast boundary of this tract as fOJIOWS.'
South +1:4'12'38" East 297.25 feet to a 5/8 inch Iron rod with a red plastic cap stamped
"Urban Engr C.C. TX" set for a corner of this tract;
South 4 *38'18" Wsot •65:54 fbit to a 5/8 [rich iron rod with o red plastic cap stamped
"Urban Engr C.C. TX" set for a corner of this tract;
South 55'•43'57" East 170.07 faet to a 5/8 inch iron rod with a red plastic cop stamped
"Urban Engr G.C. TX" set for a corner of this tract;
South 31 West 27.21 feet to a ; /8 inch iron rod with a red plastic cap stamped
"Urban Engr C.C. TX" set for a cornsr of this tract;
South 58'21'34" East 10 ;00 feret to a 5/8 Inch iron rod with a red plastic cap stamped
"Urban Engr C.C. TX" get for a corner of this tract;
South 20'2858" East 12.67 feet to a 5/8 inch Iron rod with a red plastic cap stamped
"Urban Engr C.C. TX" set for a corner of • this tract;
South 31 West 47.83 feet to a 5/8 inch iron rod with a red plastic cop stamped
"Urban Engr C.C. TX" set for a corner of this tract;
South 34'53'28" East 151.74 feet to a 5/5 inch iron rod with a red plastic cap stamped
"Urban Engr C.C. TX" set for a corner of this tract;
South 20*28'58" East 309.04 feet to a 5/8 inch iron rod with a red plastic cap stomped
"Urban Engr C.C. TX" set for an interior corner of this tract;
Thence, North 88'25'13 East, a distance of 540.00 fact to a 5/8 inch iron rod with a
rdd plastic cap stamped "Urban Engr C.C. TX" set on the west boundary of said McBride lane,
for a corner of this tract; ;
Thence, South 04'08'58" Want, a. distance of 40.20 feet to the Paint of Beginning and
containing 12.691 acres (552,8172 Square . Feet) of land.
Becrings are based on the recorded plat of Ebony Acres No. 2, a map of which is
recorded in Volume 10, Page 17, Map Records 5f Nuaces County, Texas.
ASSIGNMENT OF LEASES AND RENTALS
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU
MAY REMOVE OR STRIKE ANY OF THE FOLLOWING INFORMATION FROM THIS
INSTRUMENT BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR
SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
This ASSIGNMENT OF LEASES AND RENTALS (hereinafter referred to as
"Assignment") is made by Costa Tarragona I, Ltd. (hereinafter referred to as "Assignor "), a. Texas
limited partnership, for benefit of the Corpus Christi Community Improvement Corporation
(hereinafter referred to as "Assignee "), a Texas nonprofit corporation as of November 14, 2005.
WITNESSETH:
For value received and as additional security for the indebtedness hereinafter mentioned,
Assignor hereby assigns, transfers and conveys unto Assignee all of the right, title and interest of
Assignor in and to the rents, issues, profits, revenues, royalties, rights and benefits (hereinafter
referred to as "rents ") from the following described property:
The property described on Exhibit A attached.
In addition, Assignor hereby assigns, transfers and conveys unto the said Assignee any and
all leases and rental agreements relating to said Property (hereinafter referred to as "leases "), now
existing or hereafter made, executed or delivered, whether written or verbal, including all
amendments thereto.
The term of this Assignment shall be until that certain Real Estate Lien Note (the "Note ")
of even date herewith executed by Assignor for the construction of Two Hundred Fifty (250)
HOME rental units at the Villas of Costa Tarragona, the subject Property herein, in favor of
Assignee in the original principal amount of Four Hundred Thousand Dollars ($400,000.00), .
together with any renewal, extension or modification thereof (hereinafter referred to as "Note "),
shall have been fully paid and satisfied, at which time this Assignment shall be fully satisfied,
canceled and released. Said Note is additionally secured by a Second Lien Leasehold Deed of
Trust (the "Deed of Trust ") of even date herewith to be executed by Assignor in favor of
Assignee. Said Deed of Trust and Note, together with this Assignment, that certain "Declaration
of Restrictive Covenant of Affordability" of even date herewith executed by Assignor, and that
certain "HOME Loan Agreement" of even date herewith executed by Assignor, shall be
hereinafter referred to as the "Loan Documents."
Subject to the terms and conditions of that certain Subordination Agreement (hereinafter referred
to herein as the "Subordination Agreement") by and between J. P. Morgan Trust Company,
National Association, as Trustee, Corpus Christi Housing Finance Corporation, Corpus Christi
Community Improvement Corporation, and Costa Tarragona I, Ltd., a limited partnership, dated
as of even date herewith:
Assignment of Leases and Rentals
I. Assignor does hereby authorize and empower Assignee to collect the rents
payable under the leases as they shall become due, and does hereby direct each and all of the
tenants to pay such rents as they become due to Assignee upon demand for payment thereof by
said Assignee. It is understood and agreed, however, that no such demand shall be made unless
and until there has been a default beyond all applicable notice and cure periods in either the
payment of the Note, the payment of any other sum secured by the Loan Document, or the
performance of any of the covenants set forth in the Note, the Loan Document or this
Assignment; and, until such demand is made, Assignor is authorized to collect or continue to
collect the rents, but such privilege of Assignor to collect or continue to collect the rents shall not
operate to permit the collection by Assignor of any installment of rent in more than thirty (30)
days in advance, other than rents collected and held as a security deposit. If a default is timely
cured to the reasonable satisfaction of Assignee by Assignor, tenants shall resume paying rents to
Assignor.
2. 'The authority and power of Assignee to collect the rents, as set forth herein, may
be exercised and said rents may be collected with or without the taking of possession of the
Property, or any part thereof, and without the necessity of Assignee instituting foreclosure under
the Loan Document and/or instituting an action upon the Note or upon this Assignment. Nothing
herein, however, shall be construed to prohibit Assignee from instituting such foreclosure or such
actions upon the Note or upon this Assignment.
3. In furtherance of this Assignment, Assignor does hereby additionally authorize and
empower Assignee, through its employees, agents or representatives at the option of Assignee
and upon the occurrence of any default continuing beyond any applicable notice and cure period,
to enter upon the Property and to collect, in the name of Assignor or in its own name as Assignee,
the rents accrued but unpaid and in arrears on the date of such default, as well as the rents
thereafter accruing and becoming payable during the period this Assignment is operative; to this
end, Assignor fiuther agrees to cooperate and to assist Assignee, its employees, agents or
representatives, in all reasonable ways with collection of said rents.
4. Assignor does hereby authorize, but nothing herein shall be deemed to require or
obligate, Assignee, upon such entry onto the Property, to take over and assume its management,
operation and maintenance, to perform all acts necessary and proper in its sole discretion, and to
expend such sums as may be reasonably necessary in connection therewith, including the authority
to effect new leases, to cancel or surrender existing leases, and/or to make concessions to tenants,
with Assignor releasing all claims against Assignee arising out of such management, operation and
maintenance, excepting the liability of Assignee to account as hereafter set forth.
5. Assignee, after payment of all proper charges and expenses, including reasonable
compensation to such agents, employees or representatives as shall have been selected or
employed and after the accumulation of a reasonable reserve to meet taxes, assessments, utility
rents and fire and liability insurance in requisite amounts, shall credit the net amount of income
received by it by virtue of this Assignment to any amounts due and owing to it under the terms of
the Note and Loan Document, but the manner of the application of such net income and the
determination of which items to be credited shall be in accordance with the sole discretion of
Assignee. Any remaining amounts after all payments and credits have been made in accordance
with this paragraph shall be paid to Assignor.
2
6. Assignor expressly covenants and agrees with Assignee that at the time of
execution and delivery of this Assignment, there has been no anticipation of prepayment of any
rents by any of the tenants occupying the Property under the leases more than one month in
advance (other than those collected and held as a security deposit); and that to Assignor's
knowledge the leases (if any) are valid and enforceable and no default exists thereunder; except as
expressly disclosed in writing to Assignee, that other than the other liens, no prior assignment has
been made of the leases or of any rents from the Property; that Assignor shall perform all
obligations and duties of Lessor under the leases and will promptly notify Assignee of any default
pertaining to rent and income limits claimed by any party to said leases. Assignor further
covenants and agrees that Assignor shall have no right, power or authority to alter, modify or
amend the terms or conditions of any of the HOME assisted leases in any particular whatsoever-
without first obtaining the consent in writing of Assignee to such alteration, modification or
amendment, which approval shall not be unreasonably withheld, conditioned or delayed, and that
Assignor shall not terminate any of the HOME assisted leases or take any action to forfeit same
without the prior written approval of Assignee, which approval shall not be unreasonably
withheld, conditioned or delayed.
Nothing herein contained shall be construed as making Assignee a mortgagee in
possession, nor shall said Assignee be liable for latches or for failure to collect the rents. It is
understood, however, that Assignee is to account for such sums as are actually collected pursuant
to this Assignment prior to any foreclosure under the Loan Document. Furthermore, it is
covenanted and agreed that Assignee shall not be obligated to perform or discharge, nor does it
hereby undertake to perform or discharge, any obligation, duty or liability under the leases by
reason of this Assignment.
Assignor covenants and agrees with Assignee that no tenant need determine whether or
not a default, beyond applicable notice and cure period, has occurred to make this Assignment
operative, but instead, each tenant shall pay over the rents to Assignee upon notice from it to do
so and upon so doing shalt be relieved from liability therefor to Assignor in all respects.
It is covenanted and agreed that neither the existence of this Assignment, nor the exercise
by Assignee of its privilege to collect rents, shall be construed as a waiver by Assignee of the right
to enforce payment of the Note in strict accordance with its terms and provisions and those of the
Loan Document, and the collection of rents hereunder shall not constitute waiver of any default
which may exist under the terms of the Note or Loan Document and the Note may be accelerated
in accordance with its terms and those of the Loan Document, notwithstanding such collection.
This Assignment is given as additional security for the performance of each and all of the
obligations and covenants of the Note and Loan Document, together with any renewal, extension
or modification thereof
The covenants and agreements herein contained shall inure to the benefit of and be binding
upon the respective heirs, successors, assigns and legal representatives of the parties hereto.
Whenever used, the singular number shall include the plural, the plural the singular, and the use of
any gender shall be applicable to both genders.
THIS ASSIGNMENT IS TO BE GOVERNED, CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF TEXAS. IF ANY PROVISION OF THIS
THIS ASSIGNMENT IS TO BE GOVERNED, CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF TEXAS. IF ANY PROVISION OF THIS
ASSIGNMENT SHALL BE DETERMINED TO BE ILLEGAL OR UNENFORCEABLE, ALL
OTHER TERMS AND PROVISIONS HEREOF SHALL NEVERTHELESS REMAIN
EFFECTIVE AND SHALL BE ENFORCED TO THE FULLEST EXTENT PERMITTED BY
LAW.
EXECUTED to be effective as of the date and year first written above. -
ASSIGNOR:
COSTA TARRAGONA I, LTD., a Texas limited
partnership
By: CCHFC Costa Tarragona I, LLC, a Texas
limited liability company, its general
partner
By: Corpus Christi Housing Finance Corp.,
a Texas corporation, its sole member
By: — ' Allcx--
eo ge Noe, General Manager
(ACKNOWLEDGMENT)
STATE OF TEXAS §
COUNTY OF NUECES §
This instrument was acknowledged before me on this - -, I day of 2005,
by George Noe, the General Manager of the Corpus Christi Housing Finance Corporation, a
Texas housing finance corporation, the sole member of CCHFC Costa Tarragona I., LLC, a
Texas limited liability company, acting as the general manager of Costa Tarragona I, Ltd., a
Texas limited partnership, on behalf of the partnership.
j O�� R
4
� �It 0 BELL
Notary Public
;r;, STATE OF TEXAS STATE OF TEXAS
` f�._ -� My Camm E oa.2�. N T RY PUBLIC,
AFTER RECORDING, RETURN_ TO
Corpus Christi Community Improvement Corporation
Attn: General Manager
P. O. Box 9277
Corpus Christi, TX 78469 -9277
4
y riF
R.
E L r tlMe of san an#onio ' *
EXHIBIT "A"
Field Notes for. a 12.691 acre tract of land out of Share G, and being a portion of a 134
acre tract of land out of Share 9 and G, of the McBride Partition, said 134.6 acre being i
same property described by Deed. recorded under -Volume 94, Page 644, Deed Records of
Nueces County, Texas, said 12-691 acre tract being more fully described by metes and bou
as followw-
Beginning at a 5/8 inch iron rod with a red plastic cap stamped "Urban Engr C.C. D
set on the west boundary of McBride Lane, a 50.00 foot wide public roadway, for thq nortt
east corner of Lot 169, Ebony Acres No. 2, a map of which Is recorded In Volume 10, Pal
17. Map Records of Nusces County, Texas;
Thence, South 88'25'13" West (Plat -South aWO7'30" West), along the north boundary i
said Ebony Acres, a distance of 1.132.44 feet to a 1 inch. iron pipe found for the south
corner of this ' tract;
Thence, North 16'48'09" East, a distance of 166.59 feet to a 1' inch iron pipe found
an Interior corner of this tract;
Thence. South 89'28'08" West, a distance of 413.41 fact to a 5/8 inch iron rod with s
red plastic cap stamped "Urban Engr C.C. TX' set an the east boundary of North Padre isl-
Dnve, a public roadway also known as State Highway 358, for the southwest corner of this
tract;
Thence, along the flored right —of —way at the intersection of said North Padre Island Dr:
and Interstate Highway 37, as follows:
North 10'24'37"
East, 179.70 feet to a concrete monument found for a corner of this
tract;
North 15'26'41 "
East, 94.05 feet to a concrete monument found for a comer of this
tract;
North 22'59'10"
East, 172.48 feat to a concrete monument found for a corner of this
tract;
North 32'48' 14"
East, 172.30 feet to a concrete monument found • for a corner of this
tract;
South 31'38'2-W Wsst 27.21 feet to a �/8 Inch iron rod
North 42'31'27"
East, 172.69 feet to a concrete monument found for a corn of this
tract;
South 58'21'34" East 10.00 feidt to a 5/8 inch Iron rod
North 89'54'39"
East, 21,15 feat to a 5/8 inch Iron rod with a red plastic cap stamped
"Urban Engr C.C. T?( ", sat for a comer of this tract;
North Off 17'30'
Wegt 15.71 feat to "a concrete monument found for a comer of this
tract;
North 52'49'58"
East, 108:06 feet to a 5/8 inch Iran rod with a red plastic cap stomped
"Urban Engr C.C. TX,
adt for the north corner of this tract;
Thence, along the northeast boundary of thin tract as follows:
South 44'12'36" East 297.25 feat to a 5/8 inch iron rod
with a red plastic cap stamped
"Urban Engr C.C, TX" set for a corner of this tract;
South 4V- 38'T8" Wdat .85:54 felt to a 5/8 inch iron rat€
with a red plastic cop stamped
"Urban Engr C.C. TX ". set for a comer of this tract;
South 55 East 170.07 feet to a 5/8 inch iron rod with a- red plastic cap stamped
"Urban Engr C.C. TX" set for a comer of this tract;
South 31'38'2-W Wsst 27.21 feet to a �/8 Inch iron rod
with a red plastic cap stamped
"Urban Engr C.C. TX" sot for a corner of this tract;
South 58'21'34" East 10.00 feidt to a 5/8 inch Iron rod
with a red plastic cap stomped
"Urban Engr C.C. TX" sat for a corner of this tract;
South 20'28 East 12.67 feet to a 5/8 inch Iron rod
with a rod plastic cap stomped
TV
"Urban Engr C.C. not ror a comer of - this tra
South 31'38 "26" West 47.83 fact to a 5/8 inch iron rod
"Urban
with a red plastic cop stamped
Engr C.C. TX" set for q corner of this tract;
South 34'53'28" East 151.74 fact to a 5/8 inch iron rod
"Urban
with a red plastic cap stamped
Engr C.C. TX" set for a corner of this tract;
South 20'28'5 East 309.04 feet to a 5/8 Inch iron rod
"Urban
with a red plastic cap stamped
Engr C.C. TX' set for an Interior comer of this tract;
Thence, North 88'25'13" East, o distance of 540.00 feet to a 5/8 inch iron rod with a
red plastic cap stamped "Urban Engr C.C. T?C set on the west boundary of said McBride Lone,
for a corner of this tract,
Them, South .04'08'88` West, a of 40.20 feet to the Point of Beginning and
cont�aiaing 12,691 acres (552,802 Squar -+e l=est) of land.
Savings are based on the recorded plat of Ebony Acres No. 2, a map of which is
recorded in Volume 10, Page 17, Map Records of Nuaces County, Texas.
SECOND LIEN LEASEHOLD DEED OF TRUST
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU
MAY REMOVE OR STRIKE ANY OF THE FOLLOWING INFORMATION FROM THIS
INSTRUMENT BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR
SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
Date: November 14, 2005
Grantor: Costa Tarragona I, Ltd., a Texas limited partnership
Grantor's Mailing Address:
1201 Leopard Street
Corpus Christi, Texas 78401
Attn: City Manager
Trustee: Mary Kay Fischer
Trustee's Mailing Address:
City of Corpus Christi
P. 0. Box 9277
Corpus Christi, TX 78469 -9277
Beneficiary: Corpus Christi Community Improvement Corporation, a Texas non profit
corporation
Beneficiary's Mailing Address:
P. 0. Box 9277
Corpus Christi, TX 78469 -9277
Note:
Date: November 14, 2005
Amount: Four Hundred Thousand Dollars ($400,000) (hereinafter referred to as
"the Note ")
Maker: Costa Tarragona I, Ltd., a Texas Iimited partnership
Payee: Corpus Christi Community Improvement Corporation, a Texas
nonprofit corporation
Final Maturity Date: May 15, 2047
Terms of Payment: As provided in the Note.
Property (including any improvements):
The property described on Exhibit A attached.
Prior Liens:
A first (1s) lien thereon described in that Leasehold Deed of Trust and Security Agreement,
dated as of November 1, 2005, executed in favor of J. P. Morgan Trust Company, National
Association, As Trustee, to be recorded in the Official Public Records in Nueces County, Texas
(the "Prior Liens ").
Other Exceptions to Conveyance and Warranty:
Easements, rights -of -way, and prescriptive rights, whether of record or not, and all presently
recorded instruments, that affect the Property (together with the Prior Liens shall collectively
referred to herein as the "Permitted Exceptions ").
FOR VALUE RECEIVED AND TO SECURE PAYMENT OF THE NOTE, GRANTOR
HEREBY IRREVOCABLY GRANTS, BARGAINS, SELLS, CONVEYS, TRANSFERS
AND ASSIGNS THE PROPERTY TO TRUSTEE, HIS SUCCESSORS AND ASSIGNS,
IN TRUST, WITH POWER OF SALE. TO HAVE AND TO HOLD the Property, together
with the rights, privileges and appurtenances thereto belonging unto Trustee and her substitutes
or successors, forever, subject to Permitted Exceptions, and Grantor hereby binds itself and its
heirs, executors, administrators, personal representatives, successors and assigns to warrant and
forever defend the Property unto Trustee, her substitutes or successors and assigns, against the
claim or claims of all persons claiming or to claim the same or any part thereof subject to
Permitted Exceptions.
Grantor warrants that it has good and marketable title to the Property and has full power and
lawful authority to grant, bargain, sell, convey, assign, transfer and mortgage its interest in the
Property in the manner and form hereby done or intended. Grantor will preserve its interest in
and title to the Property and will forever warrant and defend the same to Trustee and
Beneficiary against any and all claims subject to Permitted Exceptions, and will forever warrant
and defend the validity and priority of the lien and security interest created herein against the
claims of all persons and parties whomsoever. Further, the foregoing warranty of title shall
inure to the benefit of and be enforceable by Beneficiary in the event Beneficiary acquires title to
the Property pursuant to any foreclosure. If Grantor performs all the covenants and pays the
Note according to its terms, this Deed of Trust shall have no further effect, and Beneficiary shall
release it at Grantor's expense.
GRANTOR'S OBLIGATIONS
Grantor agrees to:
2
Deed of Trust
1. Keep the Property in good repair and condition and in a safe, sanitary and decent
condition, in compliance with the City of Corpus Christi Building and Housing Codes
throughout the term of the Note wherein the Corpus Christi Community Improvement
Corporation is designated Payee..
2. Not convert any of the HOME assisted units to any form of condominium, cooperative
ownership, - or other non - residential use.
3. Pay all taxes and assessments on the Property before past due and provide on an annual
basis to Beneficiary proof of such payment.
4. Pay, before past due all claims and demands of mechanics, materialmen, laborers and
others for any and all work performed or materials delivered for the Property.
5. Preserve the lien's priority as it is established in this Deed of Trust.
.6. Deliver to Beneficiary, within ten (10) business days from the date of execution hereof, a
Mortgagee's Title policy, issued by a title company authorized to do business in the
State of Texas, on the form promulgated by the Texas State Board of Insurance, wherein
the title to the Property is insured to be as indicated in the corresponding Commitment
for Title Insurance subject to Permitted Exceptions.
7, Maintain, at Grantor's sole expense, in a form reasonably acceptable to Beneficiary, an
insurance policy that is in strict accordance with the insurance requirements set forth in
Exhibit "B" attached hereto and made'a part hereof for all purposes and comply with all
conditions stated in such exhibit.
S. Provide evidence to Beneficiary that all insurance required herein has been paid current
as of the date of such evidence being furnished to Beneficiary.
9. Keep any buildings occupied as required by the insurance policy.
10. Give Beneficiary prompt, written notice of the occurrence of any casualty affecting or
the institution of any proceedings for eminent domain or for the condemnation of the
Property, or any portion thereof.
11. Subject to the terms and conditions of the Subordination Agreement, (hereinafter
defined) assign to Beneficiary all insurance proceeds on the Property, and all causes of
action, claims, compensation, awards or recoveries for any damage, condemnation or
taking of all or any part of the Property or for any damage or injury to it or for any loss
or diminution in value of the Property.
12. If this is not a first lien, pay all prior notes that Grantor is liable to pay and abide by all
prior lien instruments in accordance with their terms.
13. Permit Beneficiary to inspect, at all times deemed appropriate by Beneficiary, the
Property to determine if it is being maintained in accordance with local Uniform Building
Code and property maintenance and upkeep standards.
14. Ensure the performance of all obligations and the compliance at all times with each and
every term and condition of this Deed of Trust.
15. Ensure the performance of all obligations and the compliance at all times with each and
every term and condition of that certain "Real Estate Lien Note" (the "Note ") this date
executed by Maker in favor of Beneficiary.
16. Ensure the performance of all obligations and compliance at all times with each and
every term and condition of that certain "HOME Loan Agreement" (the "Loan
Agreement ") this date executed by Grantor.
Deed of Trust
17, Ensure the performance of all obligations and the compliance at all times with each and
every term and condition of that certain "Assignment of Leases and Rentals" (the
"Assignment ") this date executed by Grantor (this Deed of Trust, the Note, the Loan
Agreement, the Assignment and the Declaration referred to hereinafter as the "Loan
Documents ")
18. Not discriminate against any prospective tenant to the Property on the basis of the
prospective tenant's race, color, creed, sex, national origin, age, handicap, familial status
or on the basis of said tenant's receipt of, or eligibility for, housing assistance under any
federal, state or local housing assistance program or on the basis that the prospective
tenant has a minor child or children who will be living with him/her and acknowledges
that the project for which this Deed of Trust and the Note are given, is to be constructed
specifically as a housing development intended and authorized for "low income" persons,
as that term is defined in 24 CFR Part 812 and all other applicable federal laws,
regulations, and guidelines.
19. Remain liable for the following and for any loss, cost, expense, liability, obligation and
claim which may ever be suffered or incurred by Beneficiary on account of any of the
following:
a. The commission of any fraud, or the breach of any representation or warranty
contained in -the Loan Documents or any document or instrument submitted in
connection with the Note hereby secured by or on behalf of Grantor;
b. Any default, beyond applicable notice and cure periods, by Grantor in their
respective obligations under any of the Loan Documents, to pay all taxes,
assessments and other charges imposed or assessed against the Property or, any
personalty used in connection with the operation of the Property, or to keep the
Property and all such personalty insured. as required by the Loan Documents
pertaining hereto;
C. Any waste of the Property or any damage to the Property caused by any
negligent or willful violation of any covenant or agreement contained in any of
the Loan Documents pertaining hereto regarding the maintenance, repair and
restoration of the Property or any damage to or deterioration in the Property
caused by any negligent or willful act or omission of Grantor or the employees,
agents, other representatives or contractors of Grantor;
d. The taking or allowing the taking of any action that may invalidate or diminish
any insurance carried on the Property;
e. The failure of Grantor to pay any indebtedness or obligation that results in the
filing or creation of a mechanic's, materialman's or judgment lien or other lien
against the Property or any part thereof, subject to Grantor's right to. bond
around or contest same;
f. The failure of Grantor to properly apply, or ensure the application of in
accordance with the Loan Documents, all insurance proceeds and condemnation
rewards received by Grantor with respect to the Property;
g. The failure of Grantor to return or deliver to Beneficiary any tangible personal
property (including leases, books, records and files relating to the leasing,
operation and maintenance of the Property) taken from the Property or kept
elsewhere by Grantor following any foreclosure of the Property;
4
Deed of Trust
h. The failure of Grantor to comply with any applicable governmental statutory or
other legal requirements or to ensure such compliance in connection with the
Project or to correct any defects in construction of the Property of which Grantor
has actual knowledge;
i. The failure of Grantor to deliver to Beneficiary all rents and profits collected or
received by Grantor after the occurrence of any of the following:
(i) The date on which Grantor notifies Beneficiary that Grantor intends to
abandon the Property or, in effect, to not comply fully with its obligations
under any of the Loan Documents;
(ii) The date on which the maturity of the Note is accelerated and/or there is
a judicial or non judicial foreclosure against the Property; or.
(iii) Any default under any of the Loan Documents pertaining hereto (whether
or not Grantor receives notice thereof from. Beneficiary) regarding the
construction, maintenance, repair, restoration or rehabilitation of the
Property;
j. Any and all of Beneficiary's costs, expenses, damages or liabilities, whether
incurred by Beneficiary prior to or following foreclosure of this Deed of Trust
and whether Beneficiary shall be in the status of a lienholder or an owner of the
Property following foreclosure (directly or indirectly) arising out of or
attributable to the use, generation, storage, release, threatened release, discharge,
disposal, or presence on, under, or about the -Property of any hazardous
substance;
k. All reasonable attorneys' fees and other costs incurred by Beneficiary in order to
recover from Grantor or any guarantor any of the amounts for which Grantor
remains liable as provided herein;
1. All reasonable attorneys' fees and other costs incurred by Beneficiary in the event
all of the following occur: (i) Grantor defaults beyond applicable notice and cure
period, as applicable, under any of the Loan Documents (ii) Beneficiary
accelerates the maturity of the Note secured hereby and commences judicial or
non judicial foreclosure proceedings, and (iii) either before or after the
foreclosure sale, Grantor institutes litigation or files a petition or claim in any
judicial or administrative proceeding, including without limitation any bankruptcy
or similar proceeding or any action seeking any injunctive relief against
Beneficiary or Trustee, which contests Beneficiary's right of foreclosure or the
legality of any of the Loan Documents; and
M. It being understood that the liability provisions contained in this paragraph are
binding upon Grantor and his successors and assigns and shall inure to the benefit
of Beneficiary and any subsequent holder of the Note.
GRANTOR'S REPRESENTATIONS AND WARRANTIES
Grantor, on behalf of itself and its successors and assigns, hereby represents, warrants and
covenants the following:
Deed of Trust
1. No bankruptcy or insolvency proceedings are pending or to Grantor's knowledge,
contemplated by or against Grantor or by or against any endorser, cosigner, indemnitor
or guarantor of the Note secured hereby.
2. All reports, certificates, affidavits, statements and other data furnished by Grantor to
Beneficiary in connection with the loan evidenced by the Note secured hereby are true
and correct in all material respects and will continue to be true and correct throughout
the term of the Note or, if not so continuing to be true and correct in all material
respects, will promptly be made true and correct in all material respects by Grantor, and
Grantor has not omitted to state any fact or circumstance necessary to make the
statements contained therein not misleading.
3. The execution, delivery and performance of the Loan Documents have been .duly
authorized by all necessary action to be binding and. enforceable against Grantor in
accordance with the respective terms thereof and do not contravene, result in a breach of
or constitute a default under any contract or agreement of any nature to which Grantor is
a party or by which Grantor or any of its properties may be bound and do not violate or
contravene any law, order, decree, rule or regulation to which Grantor is subject.
4. The Property and the intended use thereof by Grantor comply with all applicable
restrictive covenants, zoning ordinances, subdivision and building codes, flood disaster
laws, applicable health and environmental laws and regulations and all other ordinances,
orders or requirements issued by any state, federal or municipal authorities having or
claiming jurisdiction over the Property.
5. All utility services necessary and sufficient for the full use, occupancy, operation and
disposition of the Property for its intended purposes are available or will be available
when needed, including water, storm sewer, sanitary sewer, gas, electric, cable and
telephone facilities.
6. All streets, roads, highways, bridges and waterways necessary for access to and full use,
occupancy, operation and disposition of the Property have been completed, have been
dedicated to the appropriate governmental authority, and are open and available, or will
be available when needed to the Property without further condition or cost to Grantor.
7. There are no judicial or administrative actions, suits or proceedings pending or
threatened against or affecting Grantor or the Property which, if adversely determined,
would impair either the .Property or Grantor's ability to perform the covenants or
obligations required to be performed under this Deed of Trust or any of the Loan
Documents pertaining hereto.
8. The Property is free from any lien for water charges, sewer rents, taxes and assessments.
9. As of the date of this Deed of Trust, the Property is free from unrepaired damage caused
by fire or other casualty.
10. As of the date of this Deed of Trust, no part of the Property has been taken in ,
condemnation, eminent domain or like proceeding nor is any such proceeding pending.
BENEFICIARY'S RIGHTS
Subject to the terms of the Subordination Agreement by and between J. P. Morgan Trust
Company, National Association, as Trustee, the Corpus Christi Housing Finance Corporation, the
6
Deed of Trust
Corpus Christi Community Improvement Corporation, and Costa Tarragona I, Ltd., a Texas
limited partnership, dated as of the date herewith (the "Subordination Agreement "):
1. Beneficiary may appoint in writing a substitute or successor trustee, succeeding to all
rights and responsibilities of Trustee.
2. If the proceeds of the Note secured hereby are used to pay any debt secured by prior liens,
Beneficiary is subrogated to all of the rights and liens of the holders of any debt-so paid.
3. Any proceeds payable under the insurance policy required to be obtained by this Deed of
Trust or any of the Loan Documents shall be payable to Beneficiary. Beneficiary may
apply such proceeds it receives either to reduce the Note secured hereby or to repair or
replace damaged or destroyed improvements covered by the policy.
4. If Grantor fails to perform any of Grantor's obligations, Beneficiary may, at its option,
perform such obligations and be reimbursed by Grantor on demand at the place where the
Note secured hereby is payable for any sums so paid, including reasonable attorney's fees,
plus interest on those sums from the dates of payment at the rate stated in the Note for
matured, unpaid amounts. The sum to be reimbursed shall be secured by this Deed of
Trust.
5. If Grantor defaults beyond applicable notice and cure periods, fails to perform any of
Grantor's respective obligations, or fails to comply with any term or condition of the Loan
Documents or if default occurs on a prior lien note, and the default continues after
Beneficiary gives Grantor notice of the default and the time within which it must be cured,
if any, as may be required by law or by written agreement, then Beneficiary may:
a. Accelerate the maturity of the Note hereby secured and declare the entire unpaid
principal balance and applicable interest on the Note immediately due without the
necessity of any further action on the part of Beneficiary, and Grantor expressly
waives any requirement of notice of intent to accelerate, or of notice of such
acceleration of, the maturity of the Note hereby secured;
b. Request Trustee to foreclose this lien, in which case Beneficiary or Beneficiary's
agent shall give notice of the foreclosure sale as provided by the Texas Property
Code as then amended; and
C. Purchase the Property at any foreclosure sale by offering the highest bid and then
have the bid credited on the Note.
6. In addition to the rights of Beneficiary contained herein, Beneficiary shall have the further
right to accelerate the maturity of the Note hereby secured and declare the entire unpaid
principal balance and all applicable interest immediately clue should any one or more of the
following occur:
a. Subject to the terms and conditions of and the Limited Partners' rights under that
certain Amended and Restated Agreement of Limited Partnership (hereinafter
referred to as "Partnership Agreement"), executed by CCBFC Costa Tarragona I,
LLC, a Texas limited liability company, as General Partner, Related Direct SLP
LLC, a Delaware limited liability company, as Special Limited Partner, RCC Credit
Facility, L.L.C., a Delaware limited liability company, as Limited Partner, Costa
Tarragona I NRP, Ltd., an Ohio limited partnership, as Special Class B Limited
Partner and dated as of November 1, 2005, the Permitted Exceptions (as defined in
that certain Second Lien Leasehold Deed of Trust from Grantor to Beneficiary),
7
Deed of Trust
and resident leases of the Project, and excepting any items replaced in the ordinary
course of business, Grantor fully or partially sells, conveys, disposes of, alienates,
hypothecates, assigns, mortgages, pledges, transfers or encumbers all or any part
of the Property or any interest therein, the rents therefrom, the income therefrom,
or any other items of collateral, whether voluntarily or involuntarily, without the
prior written consent of Beneficiary;
b. Subject to the terms of the Partnership Agreement and the Permitted Exceptions,
Grantor fully or partially sells, conveys, assigns, mortgages, pledges, transfers or
encumbers a respective interest in Grantor (if Grantor is not a natural person or
persons but a corporation, partnership, trust or other legal entity), -including, in
the event Grantor is a limited -or general partnership, a joint venture or a limited - -
liability company, a change in the ownership interests in any general partner, any
Joint venturer or any member either voluntarily, involuntarily or otherwise,
whether such interest is in the form of a beneficial or partnership interest or in the
form of a power of direction, control or management, or otherwise, without the
prior written consent of Beneficiary;
C. Grantor converts any of the HOME assisted units to a form of condominium,
cooperative ownership, or other non - residential use;
d. Grantor: (1) files (as debtor) or has filed against - it, a petition for the
appointment of a receiver or for bankruptcy or insolvency, (2) becomes or is
adjudicated insolvent or bankrupt or admits in writing the inability to pay debts as
they mature, (3) petitions or applies to any tribunal for or consents to or does not
contest the appointment of a receiver, trustee, custodian or similar officer for
Grantor or for any principal or general partner of Grantor or for a substantial part
of the assets of Grantor,. or (4) commences any case, proceeding or other action
under any bankruptcy, reorganization, arrangement, readjustment of debt,
dissolution or liquidation law or statute of any jurisdiction, whether now or
hereafter in effect. In any involuntary proceeding Grantor shall have ninety (94)
days to have such matter dismissed;
e. The Property or any substantial part thereof is taken on execution or other
process of law in any action against Grantor;
f. Grantor permanently abandons the Property or a portion thereof, .. in which
eventsuch abandonment shall constitute an assignment to Beneficiary, at
Beneficiary's option, of Grantor's interest in any lease or contract then affecting
the abandoned property;
g. Grantor defaults or at any time fails to timely comply with any one or more terms
or conditions of the Loan Documents beyond applicable notice and cure period;
h. The holder of any lien or security interest on the Property, without implying the
_ consent of Beneficiary to the existence or creation of any such lien or security
interest, and whether superior or subordinate to this Deed of Trust or the Note
secured hereby, declares a default and such default is not cured within any
applicable . grace period set forth in the applicable document or institutes
foreclosure or other proceedings for the enforcement of its remedies thereunder;
i. The Property, or any portion thereof, is subjected to actual or threatened waste
or to removal, demolition or alteration so that the value of the Property is
8
Deed of Trust
diminished thereby and Beneficiary determines, in its reasonable discretion, that it
is not adequately protected from any loss, damage or risk associated therewith;
j. Any representation or warranty made in the Loan Documents, such
representation or warranty made by Grantor, any principal of Grantor, general
partner in Grantor, any person authorized by Grantor to execute any of the
aforestated documents on behalf of Grantor, or by any indemnitor under any
indemnity executed in connection with the loan secured hereby, determined by
Beneficiary to have been false or misleading in any material and detrimental
respect at the time made;
k. Grantor (i) initiates any material changes in construction work on the Property
without Beneficiary's prior, written approval, such approval not to be
unreasonably delayed, withheld or conditional or (ii) fails to provide to
.Beneficiary documentation, reasonably acceptable to Beneficiary, of the actual
Project costs incurred in connection with the Property;
1. Grantor fails to commence. construction of the project for which this Deed of
Trust and the Note are given, and more specifically detailed in paragraph 15,
General Provisions hereof, by no later than sixty (60) days following November
21, 2005 or fails to complete construction in full compliance with all conditions
and requirements set forth in the Loan Documents, including all attachments and
exhibits thereto, by no later than December 1, 2007.
M. Grantor fails to timely submit all of the documentation required in the Loan
Documents; or
n. If Beneficiary reasonably determines that the likelihood of payment of Grantor's
indebtedness evidenced by the Note or the performance of any of Grantor's
obligations hereunder or under any of the Loan Documents is threatened by
reason of a material adverse change in the financial condition or credit standing
of Grantor or any guarantor of the Loan or, if Grantor or any such guarantor is a
partnership, joint venture, trust or other type of business association, of any of
the parties comprising Grantor or any such guarantor.
Upon the happening of any of the foregoing events of default, and at the expiration of applicable
notice and cure periods all obligations, if any, of Beneficiary hereunder, including, without
limitation, any obligation to advance funds hereunder or under any of the other Loan
Documents, shall immediately cease and terminate.
Subject to the terms and provisions of the Note, notwithstanding anything to the contrary herein
contained or inferable from any provisions hereof, during the occurrence of an event of default,
the unpaid principal and applicable accrued interest on the Note shall immediately become due
and payable in full, without the necessity of any further action of the part of Beneficiary, and
except as otherwise provided in the Loan Documents, Grantor expressly waives any requirement
of notice of intent to accelerate, or of notice of such acceleration of, the maturity of the
indebtedness evidenced by the Note.
9
Deed of Trust
A default hereunder which has not been cured within any applicable grace period shall be a
default under each of the other Loan Documents and any other contract or agreement, if
applicable, between Grantor and Beneficiary.
TRUSTEE'S DUTIES
If requested by Beneficiary to foreclose this lien, Trustee shall:
1. Either personally or by agent give notice of the foreclosure sale as required by the Texas
Property Code as then amended.
2. Sell and convey all or part of the Property to the highest bidder for cash with a general
warranty binding Grantor, subject to prior liens and to other exceptions to conveyance
and warranty.
3. From the proceeds of the sale, pay, in this order:
a. Expenses of foreclosure, including a reasonable and customary fee to Trustee;
b. To Beneficiary, the full amount of principal, interest, reasonable attorney's fees,
and other charges due and unpaid;
C. Any amounts required by law to be paid before payment to Grantor; and
d. To Grantor, any balance.
GENERAL PROVISIONS
1. If any of the Property is sold under this Deed of Trust, Grantor shall immediately
surrender possession to the purchaser. If Grantor fails to do so, Grantor shall become a
tenant at sufferance of the purchaser, subject to an action for forcible detainer.
2. Recitals in any Trustee's deed conveying the Property will be presumed to be true.
3. Proceeding under this Deed of Trust, filing suit for foreclosure, or pursuing any other
remedy will not constitute an election of remedies.
4. This lien shall remain superior to liens later created even if the time of payment of all or
part of the Note secured hereby is extended or part of the Property is released.
5. If any portion of the Note secured hereby cannot be lawfully secured by this Deed of
Trust, payment shall be applied first to discharge that portion..
6. Grantor assigns to Beneficiary all sums payable to or received by Grantor from
condemnation of all or part of the Property, from private sale in lieu of condemnation of
all or part of the Property, and from damages caused by public works or construction on
or near the Property. Should such an event occur, said sums shall be payable to
Beneficiary. After deducting any expenses incurred by Beneficiary, including reasonable
attorney's fees, Beneficiary may release any remaining sums to Grantor or apply such
sums to reduce the Note. Beneficiary shall not be liable for failure to collect or to
exercise diligence in collecting any such sums.
71 Grantor assigns to Beneficiary absolutely, not only as collateral, all present and future
leases, rent and other income and receipts from the Property. Grantor warrants the
validity and enforceability of the assignment. Grantor may as Beneficiary's licensee
collect rent and other income and receipts as long as no event of default exists under the
Loan Documents and all applicable notice and cure periods have expired. Grantor will
10
Deed of Trust
apply all rent and other income and receipts to payment of the Note secured hereby and
performance of the Loan Documents, but if the rent and other income and receipts
exceed the amount due under the Note secured hereby, Grantor may retain the excess. If
an event of default exists under the Loan Documents and all applicable notice and cure
periods have expired, Beneficiary may with notice to Grantor, terminate Grantor's
license to collect and then as Grantor's agent may rent the Property if it is vacant and
collect all rent and other income and receipts. Beneficiary neither has nor assumes any
obligations as lessor or landlord with respect to any occupant of the Property.
Beneficiary shall apply all rent and other income and receipts collected under this
paragraph first to expenses incurred in exercising Beneficiary's rights and remedies and
then to Grantor's obligations under the Loan Documents in the order determined by
Beneficiary. Beneficiary is not required to act under this paragraph, and acting under
this paragraph does not waive any of Beneficiary's other rights or remedies. If Grantor
becomes a voluntary or involuntary bankrupt, Beneficiary's filing a proof of claim in
bankruptcy will be tantamount to the appointment of a receiver under Texas law.
8. Interest on the debt secured by this Deed of Trust shall be at but shall not exceed the
maximum amount of nonusurious interest that may be contracted for, taken, reserved,
charged, or received under Texas law; any interest in excess of that maximum amount
shall be credited on the principal of the debt or, if that has been paid, refunded. Upon
any acceleration or required or permitted prepayment, any such excess shall be canceled
automatically as of the date of acceleration or prepayment or, if already paid, credited on
the principal of the debt or, if the principal of the debt has been paid, refunded. This
provision overrides other provisions in this and all other instruments concerning the debt.
9. Grantor shall at all times comply with and ensure that the Property and the Project
comply with all federal, state, and local statutes, ordinances, regulations and other
governmental or quasi - governmental requirements and private covenants now or
hereafter relating to the ownership, construction, rehabilitation, use or operation of the
Property, including, but not limited to, those concerning employment and compensation
of persons engaged in operation and maintenance of the Property and any environmental,
disabled person access or ecological requirements, even if such compliance shall require
structural changes to the Property. Grantor shall not use or occupy, or allow the use or
occupancy of, the Pro perty in any manner which violates any lease of the Property or any
applicable federal, state, or local law, rule, regulation or order or which constitutes a
public or private nuisance or which makes void, voidable or cancelable, oir increases the
premium of, any insurance then in force with respect thereto.
10. In the event that Grantor is the subject of any insolvency, bankruptcy,, receivership,
dissolution, reorganization or similar proceeding, federal or state, voluntary or
involuntary, under any present or future law or act, Beneficiary is entitled to the
automatic and absolute lifting of any automatic stay as to the enforcement of its remedies
under the Loan Documents against the Property, including specifically, but not limited to
the stay imposed by Section 362 of the United States Federal Bankruptcy Code, as
amended. Grantor hereby consents to the immediate lifting of any such automatic stay,
and will not contest any motion by Beneficiary to lift such stay; Grantor expressly
acknowledges that the Property is not now, and will never be necessary to any plan of
reorganization of any type.
11
Deed of Trust
11. When the context requires, singular nouns and pronouns include the plural.
12. The term "Note" includes all sums secured by this Deed of Trust.
13. This Deed of Trust shall bind, inure to the benefit of, and be exercised by successors in
interest of all parties.
14. If Grantor and Maker are not the same person, the term "Grantor" shall include Maker.
15. Grantor represents that this Deed of Trust and the Note secured hereby are given for the
following purpose: for the construction of Two Hundred Fifty (250) HOME rental units
at the Villas of Costa Tarragona to provide affordable residences for persons whose
annual gross .income does not exceed eighty percent (80 %) of the City of Corpus Christi
area median income, (said purpose referred to herein as the "Project").
16. Beneficiary may remedy any default without waiving it.
17. Beneficiary may waive any default without waiving prior or subsequent defaults.
18. The term "days" when used herein shall mean calendar days. The term "business day"
when used herein shall mean that part of any given day from Monday through Friday
excluding those scheduled holidays officially adapted and approved by the Corpus
Christi City Council for its employees.
19. All notices, demands, requests or other communications to be sent by one party to the
other hereunder or required by law shall be in writing and shall be deemed to have been
validly given or served by delivery of the same in person to the intended addressee, or by
depositing the same with Federal Express or another reputable private courier service for
next business day delivery to the intended addressee at its address set forth below or at
such other address as may be designated by such party as herein provided, or by
depositing the same in the United States mail, postage prepaid, registered or certified
mail, return receipt requested, addressed to the intended addressee at its address set forth
below or at such other address as may be designated by such party as herein provided.
All notices, demands and requests shall be effective upon such personal delivery, or one
(1) business day after being deposited with the private courier service, or three (3)
business days after being deposited in the United States mail as required above.
Rejection or other refusal to accept or the inability to deliver because of changed address
of which no notice was given as herein required shall be deemed to be receipt of the
notice, demand or request sent. Service of any notice required by Texas Property Code
Section 51.002, as the same may be amended, shall be effective when the requirements
to that statute are met. The following are the addresses of City and Borrower for all
purposes in connection herewith:
BENEFICIARY
Corpus Christi Community Improvement Corporation
P. 0. Box 9277
Corpus Christi, TX 78469 -9277.
With a copy to:
City of Corpus Christi
City Attorney's Office
12
Deed of Trust
P. O. Box 9277
Corpus Christi, TX 78469 -9277
GRANTOR
Costa Tarragona I, Ltd.
1201 Leopard Street
Corpus Christi, Texas 78401
With a copy to:
Broad and Cassel
7777 Glades Road, Suite 300
Boca Ratan, Florida 33434
Attention: Michael Rudewicz, Esq.
And a copy to;
Wood, Boykin & Wolter, P.C.
615 N. Upper Broadway, Suite 1100
Corpus Christi, Texas 78477
And a copy to:
Related Direct SLP LLC
c/o Related Capital Company LLC
625 Madison Avenue, 5th Floor
New York, NY 10022
Attention: Marc D. Schnitzer
By giving to the other party hereto at least thirty (30) days' prior, written notice thereof
in accordance with the provisions hereof, the parties hereto shall have the right from time
to time to change their respective addresses and each shall have the right to specify as its
address any other address.
In the event of any conflict between the provisions of this Deed and those of the
Subordination Agreement, the Subordination Agreement shall prevail; provided however
that, with respect to any matter addressed in both such documents, the fact that one
document provides for greater, lesser or different rights or obligations than the other
shall not be deemed a conflict unless the applicable provisions are inconsistent and could
not be simultaneously enforced or performed.
[SIGNATURE PAGE TO FOLLOW]
13
Deed of Trust
GRANTOR:
Costa Tarragona I, Ltd., a Texas limited
partnership
By: CCHFC Costa Tarragona I, LLC, a Texas limited
liability company, its general partner
By: Corpus Christi Housing Finance Corp., a
Texas corporation, its sole member
By:
-16edYge Noe, General Manager
Attachments
Exhibit "A" — Description
Exhibit "B" --- Insurance Requirements
(ACKNOWLEDGMENT)
STATE OF TEXAS §
COUNTY OF NUECES §
This instrument was acknowledged before me on this L y�: T day of , 2005,
by George Noe, the General Manager of the Corpus Christi Housing Finance Corporation, a
Texas housing finance corporation, the sole member of CCHFC Costa Tarragona I, LLC, a Texas
limited liability company, acting as the general partner of Costa Tarragona I, Ltd., a Texas
limited partnership, on behalf of the partnership.
. ► ^ "� .!OPEN D BELL
Notary Public
STATE OF TEXAS
My Comm. Exp. 04.20 -2009 NO Y PUBLIC, STATE OF TEXAS
AFTER RECORDING RETURN TO:
Corpus Christi Community Improrvement Corporation
P. O. Box 9277
Corpus Christi, TX 78469 -9277
NC:
VA
L—L bbe of san antonio `
EXHIBIT "A"
i:ield. Notes for. a 12.691. acre tract of iond out of Share G, and being a portion of o 134
acre tract of land out of Share B and G, of .the McBride Partition, said 1344.6 acre being t
some property described by Dead. recorded under Volume 94, Page 540, Deed Records of
Nueces County. Texas, sold 12.691 acre tract being more fully described by metes and bou
as follows:
Beginning at a 5/8 inch iron rod with a red plastic cap stamped "Urban Engr C.C. TY
set an the .west boundary of McBride Lane, a 50.00 foot wide public roadway, for thq nortf
east corner of Lot 169, Ebony Acres No. 2, a map of which is recorded In Volume 10, Pa+
17, Map Records of Nueces County, Texas;
Thence, South 88'25'13" West (Plat -South 89`07'30" West), along the north boundary 1
said Ebony Acres, a distance of 1,132.44 feet to a 1 inch iron pipe found for the south
corner of this ' tract;
Thence, North 16'4$'09" East, a distance of 166.59 feet to a 1' Inch iron pipe found
an Interior corner of this tract;
Thence, South 89'28'W' West, a distance of 413.41 feet to a 5/8 inch iron rod with c
red plastic cap stamped "Urban Engr C.C. TX' set on the east boundary of North Padre Isl
Drive, a public roadway also known as State. Highway 358, for the southwest corner of this
tract;
Thence, along the flared right —of --way at the intersection of said North Padre Island Dr
and interitate Highway 37, as follows;
North
10'24'37"
f=ast,
179.70 feet to a concrete monum ant found for a corner of this
tract;
with. a red plastic cap stamped
"Urban Engr C.C. 'i'X' set for a comer of this tract;
North
15'26'41 "
East,
94.09 feet to a concrete monument found for a comer of this
tract;
'Urban Engr C.C. TX" sot for a comer of this tract;
South 58`21'34` Fast 10;00 €dot to a 5/0 Inch iron rod
North
22'59'10"
East,
172.48 feet to a concrete monument found for a corner of this
tract;
"Urban Engr C.C. TX est ror a corner of , this tract;
South .1'38'28" West 47.83 feet to a 5/8 inch iron rod with a red plastic cap stamped
"Urban
North
32 48' 14"
East,
172.30 feet to a concrete monument found - for a comer of this
tract;
" South 20'28'5 East 309.04 feet to a 5/8 inch iron rod
with a red plastic cap stamped
North
42'31'27"
East,
172.69 feet to a concrete monument found for a comer of this
tract;
North
89'54'39"
East,
2115 feet to a 5/13 inch iron rod with a red plastic cop stamped
"Urban Engr C.C. TX', set
for a comer of -this tract;
North
0617'30*
We'at
15.71 feet to "a concrete monument found for a corner of this
tract;
North
52'49'56"
East,
10846 feet to a 5/8 inch iron rod with. a red plastic cap stamped
"Urban Engr C.C. T-X,
amt for the north comer of this tract;
Thence, along the northeast boundary of this tract as follows:
South 44'12'38' East 297.25 feat to a 5/8 inch iron rod
with a red plastic cap stamped
"Urban Engr C.C. T-X" set fa a corner of this tract;
South 46'3WI -8" Walt -65:54 €ebt to a 5/8 Inch Iron rod'
with. a red plastic cap stamped
"Urban Engr C.C. 'i'X' set for a comer of this tract;
South 55`43'57" East 170.07 feet to a 5/8 inch iron rod with a red plastic cap stamped
'Urban Engr C.C. TX" set for a tamer of this tract;
South 31'38'26" Wept 27.21 feet to a 5/a Inch iron rod
with a red plastic cap stamped.
'Urban Engr C.C. TX" sot for a comer of this tract;
South 58`21'34` Fast 10;00 €dot to a 5/0 Inch iron rod
with a red plastic cap stamped
'Urban Engr C.C. TX" set for a corner of this tract;
South 20'2858" Fast 12.57 feet to a 5/8 Inch Iron rod
with a red plastic .cap stumped
"Urban Engr C.C. TX est ror a corner of , this tract;
South .1'38'28" West 47.83 feet to a 5/8 inch iron rod with a red plastic cap stamped
"Urban
Engr C.C. TX" set for a corner of. this tract;
South 34'53'28" East 151.74 feet to a 5/8 inch Iron rod
"Urban
with a red plastic cap .stamped
Engr C.C. TX" act for a corner of this tract;
" South 20'28'5 East 309.04 feet to a 5/8 inch iron rod
with a red plastic cap stamped
Urban Engr C.C. TX set for an Interior comer of this tract;
Thence, North W25'13' East, a distance of 540.00 feet to 0 5/8 inch iron rod with a
red plastic cap stamped 'Urban Engr C.C. TX' set on the weal boundary of said McBride Lane,
for a corner of this tract;
Thence, SoUth .A4 "08'08' West, a ,.distance of 40.20 feat to the Point of Beginning and
containing 12.691 acres (552,802 54610re' Feet) of land.
Bearings are based on the recorded plot of Ebony Acres No. 2, a map of which is
recorded in Volume 10, Page 17, Map Records if Nuaces County, Texas.
EXHIBIT B
INSURANCE REQUIREMENTS
GRANTOR AGREES TO:
1. Maintain, in a form acceptable to Beneficiary, an insurance policy that:
a. covers all improvements for their full insurable value as determined
when the policy is issued and renewed, unless Beneficiary approves
a smaller amount in writing;
b. contains an 80% coinsurance clause;
c. provides fire and extended coverage, including windstorm coverage;
d. protects Beneficiary with a standard mortgage clause;
e. provides flood insurance at any time the property is in a flood hazard
area; and
f. contains such other coverage as Beneficiary may reasonably require.
2. Comply at all times with the requirements of the 80% coinsurance clause.
3. Deliver the insurance policy to Beneficiary and deliver renewals to Beneficiary
at least ten days before expiration.
4. Keep all buildings occupied as required by the insurance policy.
16
Deed of Trust
REAL ESTATE LIEN NOTE
Date: November 14, 2005
Maker: Costa Tarragona I, Ltd., a Texas limited partnership
Makers' Mailing Address:
c/o Corpus Christi Housing Finance Corporation
P. 0. Box 9277
Corpus Christi, TX 78469 -9277
Attn: General Manager
Payee: Corpus Christi Community Improvement Corporation, a Texas nonprofit
corporation
Place for Payment: 1201 Leopard Street, Corpus Christi, 78469, ATTN: General Manager,
Nueces County, Texas; or any other place that Payee may designate in writing.
Principal Amount: Four Hundred Thousand Dollars ($400,000.00)
Annual Interest Rate on Unpaid Principal: Interest shall accrue beginning at the date first set forth
above at a rate of Four and 57 /100ths percent (4.57 %) per annum unless and until
Maker (1) defaults beyond any applicable notice and cure period in the payment of
the Note or (2) fails to comply with any one or more terms or conditions of the
Note, or defaults beyond any applicable notice and cure period under any one or
more of the other Loan Documents. In the event that Maker so defaults in the
payment of this Note or fails to comply with any provision of any of the Loan
Documents (said Loan Documents described below), interest on the unpaid
principal shall thereafter (a) accrue at the rate of Four and 57 /100ths percent
(4.57 %) per annum until such default is cured, and (b) be capitalized and added to
the entire remaining principal amount then owing.
Annual Interest Rate on Matured, Unpaid Amounts: A rate of Four and 57/100ths percent
(4.57 %) per annum.
Terms of Payment (Principal and interest): This Note is a forty (40) year loan with a payment
deferment period of eighteen (18) months commencing May 15, 2007, and ending
May 15, 2047, subject to Maker's compliance with each and every term and
condition of (1) this Note, (2) that certain "Second Lien Leasehold Deed of Trust"
(the "Deed of Trust") this date executed by Maker to secure this Note, (3) that
certain "HOME Loan Agreement" (the "HOME Loan Agreement ") this date
executed by Maker and Payee, (4) that certain "Assignment of Leases and Rentals'
(the "Assignment ") this date executed by Maker, and (5) that certain "Declaration
of Restrictive Covenant of Affordability" (the "Declaration ") this date executed by
Maker against the Property (said Property described below). (This Note, the Deed
of Trust, the HOME Loan Agreement and the Declaration collectively referred to
herein as the "Loan Documents ").
The specific terms of payment of this Note are as follows:
Principal and interest shall be due and payable from, and only to the extent of, Net
Cash Flow, as defined below, in forty (40) annual installments of Ten Thousand
Dollars ($10,000), payable each and every year beginning May 15, 2007, and
continuing regularly thereafter until the whole of said principal in the amount of
Four Hundred Thousand Dollars ($400,000), plus applicable interest has been duly
paid: In the event that Maker is unable to make said payments of principal and
interest due to the unavailability of cash flow, all principal and interest payments
not made, shall be due and payable on the maturity date herein; said payments shall
be capitalized and added to the outstanding principal balance of the Note and shall
accrue interest at the rate of Four and 57 /100ths percent (4.57°/x) per annum;
provided, however, Maker's failure to make a payment under this Note due to lack
of Net Cash Flow shall not constitute a Default under this Note or any other Loan
Document.
Net Cash Flow shall be defined herein as the excess of Cash Receipts (which shall mean, all cash
receipts of Maker from whatever source, derived other than from a Capital Transaction or Capital
Contributions) (as such terms are defined in the Partnership Agreement as hereinafter described
below) including, without limitation, cash from operations, any amounts attributable to
construction or development savings, interest earned on and released from reserves held by or for
the benefit of the Project and/or the Maker, and net insurance recoveries (other than proceeds
from title insurance recoveries and other than condemnation or casualty proceeds) (in addition,
the net reduction in any year in the amount of any escrow account or reserve maintained by or for
Maker shall be considered a cash receipt of Maker for such year) over Cash Expenditures, (which
shall mean, all disbursements of cash during the year, including, without limitation, payment of
Operating Expenses (as defined in that certain Loan Agreement between the Corpus Christi
Housing Finance Corporation and Maker dated as of November 1, 2005, the "Loan Agreement "),
the payment of debt service pursuant to the terms of the Loan Agreement, including principal and
interest on Maker's indebtedness thereunder, the payment of Deferred Development Fee and the
Annual Local Administrative Fee, cost of repair and restoration of the Project, and amounts
allocated to reserves by the General Partner (as those terms are defined in the Partnership
Agreement), but excluding amounts paid from reserves established in a prior year. In addition,
the net increase during the year in any escrow account or reserve maintained by or for Maker shall
be considered Cash Expenditure during the year. Cash Expenditures payable to Partners or
Affiliates of Partners (as that term is defined in the Partnership Agreement) shall be paid after
Cash Expenditures payable to third parties, except for payments to a Management Agent (as that
term is defined in the Partnership Agreement) which may be an Affiliate of a Partner to the extent
such fees are payable and are not subject to deferral. Cash Expenditures shall not include
expenses incurred in connection with a Capital Transaction. ' Net Cash Flow shall be determined
separately for each fiscal year or portion thereof
2
Real Estate Lien Note
Security for Payment: A Deed of Trust of even date herewith from Maker to Payee, against the
real property more particularly described in Exhibit "A," which is attached to this Note
and incorporated herein for all purposes (the "Property ").
Maker promises to pay to the order of Payee at the place for payment and according to the terms
of payment the principal amount plus interest at the rates stated above. All unpaid amounts shall
be due by the final scheduled payment date.
Subject to the terms and conditions of the Subordination Agreement by and between J. P.
Morgan Trust Company, National Association, as Trustee, Corpus Christi Housing Finance
Corporation, Corpus Christi Community Improvement Corporation and Costa Tarragona I, Ltd.,
dated as of the date herein (the "Subordination Agreement"), if Maker defaults in the payment of
this Note or defaults in the performance of any obligation in any instrument securing or collateral
to it, and the default continues after Payee gives Maker notice of the default and the time within
which it must be cured, if any, as may be required by law or by written agreement, then Payee
may declare the unpaid principal balance and earned interest on this Note immediately due.
Maker and each surety, endorser, and guarantor waive all demands for payment, presentations for
payment, notices of intention to accelerate maturity, notices of acceleration of maturity, protests,
and notices of protest, to the extent permitted by law.
If this Note or any of the documents referenced in the "Terms of Payment" section above, or any
instrument securing or collateral to it is given to an attorney for collection or enforcement, or if
suit is brought for collection or enforcement, or if it is collected or enforced through probate,
bankruptcy, or other judicial proceeding, then Maker shall pay Payee all costs..of collection and
enforcement, including reasonable attorney's fees and court casts, in addition to other amounts
due.
Interest on the debt evidenced by this Note shall not exceed the maximum amount of Four and
571100ths percent (4.57 %) interest that may be contracted for, taken, reserved, charged, or
received under law; any interest in excess of the maximum amount shall be credited on the
principal of the debt or, if that has been paid, refunded. On any acceleration or required or
permitted prepayment, any such excess shall be canceled automatically as of the acceleration or
prepayment or, if already paid, credited on the principal of the debt or, if the principal of the debt
has been paid, refunded. This provision overrides other provisions in this and all other
instruments concerning the debt.
Subject to the terms and conditions of the Subordination Agreement, in addition to rights of
Payee as contained herein, Payee shall have the further right to accelerate the maturity of this
Note and declare any unpaid amount immediately due should any one or more of the following
events occur:
(1) Subject to the terms of that certain Amended and Restated Agreement of Limited
Partnership (hereinafter referred to as "Partnership Agreement "), executed by
Maker's limited partners and general partners and dated as of November 1, 2005,
the Permitted Exceptions (as defined in that certain Deed of Trust from Maker to
3
Real Estate Lien Note
Payee), and resident leases of the Project, and excepting any items replaced in the
ordinary course of business, Maker fully or partially sells, conveys, disposes of,
alienates, hypothecates, assigns, mortgages, pledges, transfers or encumbers all or
any part of the Property or any interest therein, the rents therefrom, the income
therefrom, or any other item of collateral, whether voluntarily or involuntarily,
without the prior written consent of Payee through its Department's Director or
his designate;
(2) Subject to the terms and conditions of and the Limited Partners' rights under the
Partnership Agreement and the Permitted Exceptions, Maker fully or. partially
sells, conveys, assigns, mortgages, pledges, transfers or encumbers an interest in
Maker (if Maker is not a natural person but a corporation, partnership, trust or
other legal entity) including, in the event Maker is a limited or general
partnership, a joint venture or a limited liability company, a change in the
ownership interest in any general partner, any joint venturer or any member,
whether such interest is in the form of a beneficial or partnership interest or in the
form of a power of direction, control or management, or otherwise said change
either voluntarily, involuntarily or otherwise, without the prior written consent of
Payee;
(3) Maker converts any of the HOME assisted units (defined herein as portions of the
Property developed with the HOME funds herein) to a form of condominium,
cooperative ownership or other non - residential use;
(4) Maker: (1) files as debtor, or has filed against it, a petition for the appointment of
a receiver or for bankruptcy or insolvency, (2) becomes or is adjudicated insolvent
or bankrupt or admits in writing the inability to pay debts as they mature, (3)
petitions or applies to any tribunal for or consents to or does not contest the
appointment of a receiver, trustee, custodian or similar officer for Maker, any
principal of Maker or general partner of Maker, or a substantial part of the assets
of Maker, or commence, as a debtor, any case, proceeding . or other action under
any bankruptcy, reorganization, arrangement, readjustment of debt, dissolution or
liquidation law or statute of any jurisdiction, whether now or hereafter in effect.
In any involuntary proceeding Maker shall have ninety (90) days to have such
matter dismissed;
(5) The Property or any material part thereof is taken on execution or other process of
law in any action against Maker;
(6) Maker permanently abandons the Property or any material portion thereof, in
which event such abandonment shall constitute an assignment to Payee, at Payee's
option, of Maker's interest in any lease or contract then affecting the abandoned
Property;
4
Real Estate Lien Note
(7) Maker defaults or fails to timely comply with any one or more terms and
conditions of the Loan Documents beyond any applicable notice and cure period;
(S) The holder of any lien or security interest on the Property, without implying the
consent of Payee to the existence or creation of any such lien or security interest
(except as otherwise acknowledged herein), and whether superior or subordinate
to the Loan, the Note evidencing the Loan or the Deed of Trust securing such
Note, (1) declares a default and (2) such default is not cured within any applicable
grace period set forth, if at all, in the applicable document or institutes foreclosure
or other proceedings for the enforcement of its remedies thereunder;
(9) The Property, or any portion thereof, is subjected to actual or threatened waste or
to removal, demolition or alteration so that the value of the Property is materially
diminished thereby and Payee reasonably determines that it is not adequately
protected from any loss, damage or risk associated therewith;
(10) Any representation or warranty made herein by acceptance signature of Maker
hereto, or in any of the Loan Documents, such representation or warranty made by
Maker, any principal of Maker, general partner in Maker, any person authorized
by Maker to execute any of the aforestated documents on behalf of Maker, or by
any indemnitor under any indemnity executed in connection with the Loan,
determined by Payee to have been false or misleading in any material and
detrimental respect at the time made;
(11) Maker at any time fails to remain in compliance with each and every term and
condition of or in the Loan Documents beyond any applicable notice and cure
period;
(12) Maker (i) initiates any changes in the Project without Payee's written approval or
(ii) fails to provide to Payee documentation acceptable to Payee of the actual
quoted costs incurred in connection with the Project; or
(13) Maker fails to commence the Project (which shall mean Maker shall have closed
the Loan evidenced by the Loan Documents) by November 21, 2005, or fails to
complete this Project by December 1, 2007.
Payee hereby agrees that, if Maker is a limited partnership, any limited partner of Maker may, but
shall not be obligated to, cure any default by Maker hereunder and for the purposes hereof such
curative actions shall be considered the actions of Maker.
Notwithstanding any provision herein to the contrary, Maker and the direct and indirect equity
owners of Maker, including without limitation Maker's general or limited partners, shareholders,
members or venturers, shall have no liability for any amounts due hereunder and Payee's sole
recourse shall be against Maker's interest in the Property; provided, however, that such limitation
Real Estate Lien Note
of recourse shall not apply to Maker's general partner in the event of any loss suffered or
incurred by Payee as a result of any of the following;
1) fraudulent representations by or on behalf of Payee contained in any of the Loan
Documents or in any other documents submitted by Maker to Payee;
2) the application of rents, income or profit received by Payee from the Property after
an event of default under the Loan Documents in contravention of the provisions
of the Loan Documents after Payee has given notice to Maker of the occurrence of
an event of default and such default not otherwise cured within any applicable
notice and cure period;
3) the application of insurance proceeds or condemnation awards in contravention of
the provisions of the Loan Documents;
4) the sale or transfer of the Property in contravention of the provisions of the Loan
Documents without Payee's consent;
5) failure by Payee to insure the Property in accordance with the terms of the Loan
Documents; or
6) the violation by Payee of any environmental laws, rules or regulations applicable
to the Property.
When the context requires, singular nouns and pronouns include the plural.
In the event of any conflict between the provisions of this Note and those of the Subordination
Agreement, the Subordination Agreement shall prevail; provided however that, with respect to
any matter addressed in both such documents, the fact that one document provides for greater,
lesser or different rights or obligations than the other shall not be deemed a conflict unless the
applicable provisions are inconsistent and could not be simultaneously enforced or performed.
[SIGNATURE PAGE TO FOLLOW]
6
Real Estate Lien Note
COSTA TARRAGONA I, LTD., a Texas Iimited
partnership
By: CCHFC Costa Tarragona I, LLC, a Texas
limitcd liability company, its general -
partner
By: Corpus Christi Housing Finance Corp.,
a Texas corporation, its sole member
By: -A-,,�-
dedqge Noe, General Manager
is SY -- t* ' �•'�
Me of san antonio
EXHIBIT "A"
Field Notes for. a 12.691 acre tract of land out of Shore G, and being a portion of a 13.+
acre tract of land out of Share B and G, of the McBride Partition, said 134.6 acre being I
some property described by Dead. recorded under Volume 94, Page 540 Deed Records of
Nueces County, Texas, said 12.691 acre tract being more fully described by metes and hou
as follows.
Beginning at a 5/8 inch . iron raid with a
set on the west . boundary of McBride i_ans, a
east corner of Lot 169, Ebony Acres No. 2, a
17, Map Records of Nusces County, 'texas;
red plastic cap stamped "Urban Engr C.C. D
50.00 foot wide public roadway, for the nor f
map of which is recorded in Volume 10, Pa+
Thence, South 88'25'13 West (Plat -South 89'07'30" Was t0, along the north boundary i
said Ebony Acres, a distance of 1,132.44 feet to a 1 Inch iron pipe found for the south
comer of this ' tract;
Thence, North 16'48'C1S" East, a distance of 166.59 feet to c 1 Inch Iran pipe found
an Interior corner of this tract;
Thence, South' 89'28'0" West, a distance of 413.41. fact to a 5/8 inch iron rod with 1
red plastic cap stamped "Urban Engr C.C. TX" set on the east boundary of North Padre lsl,
Drive, a public roadway also known as State Highway 358, far. the southwest corner of this
tract•,
Thence, along the flared right --of —way at the intersection of said North Padre Island Dr
and Interstate Highway 37, as follows;
North 10'24'37"
East, 179.70 feet to a concrete monument found for a comer of this
tract;
North 15'26'41"
East, 94.08 feet to a co_ ncrete monument Found for a corner of this
tract;
North 22`59'10"
East, 172.45 feet to a concrete monument found for a comer of this
tract;
South 3178'2%" Witst 21.21 feet to a $/6 inch iron rod with a
North 3Z4
East, 172.30 feet to a concrete monument found - for a comer of this
tract;
. South 58'21'34" East 10:00 feet to a 5/6 inch iron rod with a
North 42'31'27"
East, 172.69 feet to a concrete monument found for a comer of this
tract;
South 20'28'56" East 12.67 test to a 5/8 inch Iron rod with a
North 89'5439"
East 21.15 fact to a 5/8 inch iron rod with a red plastic . cap stamped
"Urban Engr C.C. TX ", set for a comer of -this tract;
North OD' 17'30"
Weot 15.71 - feet to "'a concrete monument found for a corner of this
tract;
North 52'49'56"
East, 108:06 feet to a 5/8 inch iron rod with a red plastic cap stamped
"Urban Engr C.C. T',t,
abt for the north corner of this tract;
Thence, along the northeast boundary of this tract as follows.
South 44'12'36' East 297.25 feet to a 5/8 inch iron rod with a
red plastic cap stamped
"Urban Engr C.C. TX" set far a corner of this tract;
South 4$'38'18" West .135:54 feat to a 5/8 inch iron rod with a
rod plastic cop stomped
"Urban Engr C.C. TX" set for a comer of this tract;
South 55 43'57" East 174.07 faet to a 5/8 inch iron rod with a• red plastic cpp stamped
"Urban Engr C.C. TX* set for a corner of this tract;
South 3178'2%" Witst 21.21 feet to a $/6 inch iron rod with a
red plastic cap stamped
"Urban Engr C.C. TX" sat for a comer of this tract;
. South 58'21'34" East 10:00 feet to a 5/6 inch iron rod with a
red plastic cap stamped
"Urban Engr C.C. TX" set for a corner of this tract;
South 20'28'56" East 12.67 test to a 5/8 inch Iron rod with a
red plastic cap stamped
"Urban Engr Q.C, TV set ror a corner of " this tract;
South 31'38'26" West 47.83 feet to a 5/8 inch iron rod with a
"Urban
red plastic cap stamped
Engr C.C. TX" set for a corner of this tract;
South 34'53'28" East 151.74 feet to a 5/5 inch iron rod with a
"Urban
red plastic cup stamped
Engr C.C. TX" set for a comer of this tract
South 20'28'58" East 309.04 feet to a 5/5 inch iron rod with a
"Urban
red plastic cap stamped
Engr C.C. TX" set for an. Interior comic of this tract;
Thence, North 88'25'13" East, a distance of 540.00 feet to a 5/8 inch irten rod with a
red plastic cap stamped "Urban Engr C.C. TX" set on the west boundary of said McBride Lane,
for a corner of this tract;
Thence, South .04'08'58` West, a , distanca of 40.20 feet to the Point of Beginning and
containing 12.891 acres (552,862 S46are'i=eet) of land.
Bearings are based an the - recanted plat of Ebony Acres No. 2, a reap of which is
recorded in Volume 10, Rage 17, Map. Records taf Nucces County, Texas.
HOME LOAN AGREEMENT
BETWEEN THE
CORPUS CHRISTI COMMUNITY IMPROVEMENT CORPORATION
AND
COSTA TARRAGONA I, LTD.
STATE OF TEXAS §
COUNTY OF NUECES §
This HOME LOAN AGREEMENT is hereby made and entered into by and between the
Corpus Christi Community Improvement Corporation (hereinafter referred to as the "CCCIC "), a
Texas nonprofit corporation, acting by and through its General Manager, and Costa Tarragona I,
Ltd. (hereinafter referred to as `BORROWER"), a Texas limited partnership, acting by and
through its General Partner, CCHFC Costa Tarragona I, LLC, a Texas limited liability company,
acting by and through its sole member, Corpus Christi Housing Finance Corporation, a Texas
corporation, acting by and through its General Manager, hereto duly authorized and hereinafter
referred to as BORROWEWs General Manager.
WHEREAS, CCCIC, through the City of Corpus Christi, Texas (hereinafter referred to
as "CITY"), has received certain funds from the U.S. Department of Housing and Urban
Development ("HUD ") under Title II of the National Affordable Housing Act of 1990, (P. L. 101-
625) (hereinafter referred to as "HOME") for utilization in connection with its HOME Investment
Partnerships Grant (hereinafter referred to as "HOME") Program; and
WHEREAS, the CCCIC, with the approval of the CITY's City Council, has adopted a
budget for such .funds and has included therein the expenditure of funds in the form of a loan (the
"Loan ") to BORROWER for the project entitled, "Villas of Costa Tarragona r ( hereinafter
referred to as "Project "); and
WHEREAS, the CCCIC is responsible for the administration and monitoring of the
Project and all matters pertaining thereto; and
WHEREAS, CCCIC wishes to make the Loan to BORROWER in connection with the
BORROWER's development of the Project; and
WHEREAS, as a part of said Project implementation and management by BORROWER,
it is proposed that the Loan be made to BORROWER for, among other things, construction of
certain improvements upon real property more particularly described in Exhibit "A" attached
hereto, incorporated herein and made a part hereof for all purposes (such real property and any
and all improvements along with any construction done or hereafter to be done referred to herein
as the "Property "), such Loan to be secured by, among other things, liens and security interests
(the "CCCIC Liens ") against the Property; NOW THEREFORE:
HOME loan agreement
The parties hereto severally and collectively agree, and by the execution hereof are bound,
to the mutual obligations herein contained and to the performance and accomplishment of the
tasks hereinafter described.
I. DEFINITIONS
1.1 For purposes of this HOME LOAN AGREEMENT, in addition to the definitions and
references set forth throughout this HOME LOAN AGREEMENT, the following terms shall have
the meanings indicated:
(A) "Business Day" — Every day of the week, except all Saturdays, Sundays and those
scheduled holidays officially adopted and approved by the CITY's City Council for
its employees.
(B) "Environmental Law" — Any federal, state or Iocal law, statute, ordinance or
regulation pertaining to health, industrial hygiene or the environmental conditions
on, under or about the Property including, without limitation, (i) the Resource
Conservation and Recovery Act, as amended by the Hazardous and Solid Waste
Amendments of 1984, as now or hereafter amended C "RCRA') (42 U.S.C. §6901,
et. seq.); (ii) the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, as now or hereafter amended ( "CERCLA ") (42
U.S.C. §9601, et. seq.); (iii) the Clean Water Act, as now or hereafter amended
( "CWA') (33 U.S.C. §1251, et. seq.); (iv) the Toxic Substances Control Act, as
now or hereafter amended ( "TSCA') (15 U.S.C. §2601, et. seq.); (v) the Clean Air
Act,'as now or hereafter amended ( "CAA ") (42 U.S.C. §7401, et. seq.), Texas
Solid Waste Disposal Act (V.T.C.A. Health and Safety Code §361.001, et. seq.)
and the Texas Water Code (V.T.C.A. Water Code §26.001- 26.407); (vi) all
regulations promulgated under any of the foregoing; (vii) any local, state or federal
law, statute, regulation or ordinance analogous to any of the foregoing; and (viii)
any other federal, state or local law (including any common law), statute,
regulation or ordinance regulating, prohibiting or otherwise _ restricting the
placement, discharge, release, threatened release, generation, treatment or disposal
upon or into any environmental media of any substance, pollutant or waste which
is now or hereafter classified or considered to be hazardous or toxic to human _
health or the environment.
(C) "Environmental Report" — A report prepared by a reputable engineer or other
party satisfactory to CCCIC, in its reasonable determination and/or discretion, and
in such detail as CCCIC may require, indicating that no part of the Property is
contaminated with Hazardous Materials or is subject to undue risk of
contamination by Hazardous Materials.
2
HOME loan agreement
(D) "Governmental Authority" — Any and all courts, boards, agencies, commissions;
offices or authorities of any nature whatsoever for any governmental unit (federal,
state, county, district, municipal or otherwise), whether now or hereafter in
existence, having jurisdiction over the applicable matter.
(E) "Hazardous Materials" — Any flammables, explosives, radioactive materials,
asbestos, petroleum products or other hazardous waste, including, without
limitation, substances defined as "hazardous substances," "hazardous materials" or
"toxic substances" in any Environmental. Law; excluding however, standard
prepackaged household items and supplies and materials necessary for the
construction and operation of the Property.
(F) "Legal Requirements" -- (i) any and all present and future judicial decisions,
statutes, rulings, rules, regulations, permits, certificates or ordinances of any
Governmental Authority in any way applicable to BORROWER, any guarantor of
the Project, the Loan, or the Property, including, without limitation, the
ownership, use, construction, rehabilitation, development, occupancy, possession,
operation, maintenance, alteration, repair or reconstruction thereof, (ii) any and all
covenants, conditions and restrictions contained in any deed or other form of
conveyance or in any other instrument of any nature that relate in any way or are
applicable to the Property or the ownership, use, construction, occupancy,
possession, operation, maintenance, alteration, repair or reconstruction thereof,
(iii) BORROWEWs or any Project or Loan guarantor's presently or subsequently
effective bylaws and articles of incorporation or partnership, limited partnership,
joint venture, trust or other form of business association agreement, (iv) any and
all leases related to the Property or the Project, (v) other contracts, whether
written or oral, of any nature that relate in any way to the Property or the Project
and to which BORROWER or any Loan or Project guarantor may be bound.
(G) "Loan Documents" — (i) this HOME LOAN AGREEMENT, (ii) that certain "Real
Estate Lien Note" (the "Note "), of even date herewith, signed by BORROWER,
evidencing its obligation for payment to CCCIC in connection with the Loan, (iii)
that certain "Second Lien Leasehold Deed of Trust" (the "Deed of Trust") of even
date herewith, signed by BORROWER and securing payment of the Note, (iv) that
certain "Assignment of Leases and Rentals," of even date herewith, signed by
BORROWER in connection with the Project, and (v) that certain "Declaration of
Restrictive Covenant of Affordability," of even date herewith, signed by
BORROWER in connection with the Project.
(H) "Material" — (i) as to monetary matters, any amount in excess of $10,000.00 or (ii)
as to all other matters, any fact or circumstance without which CCCIC, in its
reasonable opinion, would not have made the Loan.
(I) "Plans" — Any and all contracts and agreements, written or oral, between the
CCCIC - approved architect for the Project and BORROWER, together with the
HOME loan agreement
final plans, specifications, shop drawings and other technical descriptions prepared
for the construction done in connection with the Project, and all amendments and
modifications thereof.
II. TERM
2.1 Except as otherwise provided for pursuant to the provisions hereof, this HOME LOAN
AGREEMENT shall commence immediately upon its execution and shall terminate at the end of
the Note term.
2.2 Notwithstanding the provisions of paragraph 2.1 hereof; the completion date for
construction work for the Project shall be no later than December 1, 2007.
M. RESPONSIBILITIES
3.1 BORROWER hereby accepts responsibility for the performance, in a satisfactory and
efficient manner as determined by CCCIC, in its reasonable determination and/or discretion, of all
services and activities set forth in this HOME LOAN AGREEMENT.
3.2 Unless written notification by BORROWER to the contrary is received and approved by
CCCIC, BORROWER's General Manager shall be BORROWER's designated representative
responsible for the management of all contractual matters pertaining to this HOME LOAN
AGREEMENT.
3.3 CCCIC, acting through staff designated by the General Manager, is responsible for the
administration of this HOME LOAN AGREEMENT.
3.4 Communications between CCCIC and BORROWER shall be directed to the designated
representatives of each as set forth in paragraphs numbered 3.2 and 3.3 hereinabove.
IV, COMPLIANCE WITH FEDERAL, STATE AND LOCAL LAWS
4.1 BORROWER understands that funds provided to it pursuant to this HOME LOAN
AGREEMENT are funds, which have been made available to CCCIC, through the CITY, by the
federal government under the HOME Investment Partnership Program (Final Rule) and in
accordance with CITY's HUD - approved Grant Application and with other specific assurances
made and executed by CITY. BORROWER, therefore, assures and certifies that it will comply,
in all material respects, with the requirements of the HOME Investment Partnership Program
(Final Rule) and with all regulations promulgated thereunder, codified at Title 24 of the Code of
Federal Regulations. BORROWER understands, however, that the HOME Investment
Partnership Program (Final Rule) in no way is meant to constitute a complete compilation of all
duties imposed upon BORROWER by law or administrative ruling, or to narrow the standards
which BORROWER must follow. Accordingly, BORROWER understands that if, the regulations
and issuances promulgated pursuant to the HOME Investment Partnership Program (Final Rule)
4
HOME loan agreement
are amended or revised, it shall comply with them or otherwise promptly notify CCCIC pursuant .
to the provisions of Article XLIV of this HOME LOAN AGREEMENT.
4.2 BORROWER understands. that summaries of certain compliance requirements mandated
by applicable laws or regulations are available from the CCCIC, and that BORROWER must at all
times remain in compliance therewith; BORROWER further understands that said summaries are
intended only as such and in no way are meant to constitute a complete compilation - of all duties
imposed upon BORROWER by law or administrative ruling, or to narrow the standards -which
BORROWER must follow.
4.3 BORROWER assures that all contractors and subcontractors receiving funds in
connection with this Project are familiar with, and shall comply with, any and all applicable federal
and state laws, rules and regulations provisions mandating compliance with all applicable federal
and state laws, rules, and regulations will be included as part of every contract awarded in
connection with this Project.
4.4 BORROWER shall observe and comply with all Legal Requirements.
V. BORROWER'S WARRANTIES AND REPRESENTATIONS
5.1 BORROWER hereby unconditionally warrants, represents, assures and guarantees unto
CCCIC the following:
(A) BORROWER possesses the legal authority, pursuant to any proper, appropriate
and official motion, resolution or action passed or taken, to enter into this HOME
LOAN AGREEMENT and the other Loan Documents and to perform the
responsibilities herein required, and each such document constitutes a legal and
binding obligation of, and is valid and enforceable against, BORROWER and the
Property (as the case may be) in accordance with the terms thereof.
(B) BORROWER represents, warrants, assures and guarantees that the individual
executing this HOME LOAN AGREEMENT has full legal authority to execute
this HOME LOAN AGREEMENT on behalf of BORROWER and to bind
BORROWER to all terms, performances and provisions herein contained.
(C) Any and all information, reports, papers and other data (including, without
limitation, any and all balance sheets, statements of income or loss, reconciliation
of surplus and financial data of any other kind) heretofore furnished or to be
furnished CCCIC by or on behalf of BORROWER are, or when delivered will be,
true and correct in all material respects; all financial data has been, or when
delivered will have been, prepared in accordance with generally accepted
accounting principals consistently applied, and fully and accurately present, or will
present, the financial condition of the subjects thereof as of the dates thereof, and,
with respect to the financial data heretofore furnished, no materially adverse
5
HOME loan agreement
change has occurred in the financial condition reflected therein, since the dates
thereof.
(D) Except as may be otherwise set forth on any exhibit attached hereto, there are no
actions, suits or proceedings of a material nature pending or, to BORROWER's
knowledge, threatened against or affecting BORROWER, any Loan or Project
guarantor or the Property, or involving the validity or enforceability of-the Deed of
Trust or the priority of the liens and security interests created therein; and no event
has occurred (including specifically BORROWER's and all Loan and Project
guarantors' execution of their respective security documents related to the Loan
and BORROWER's consummation of the Loan) which will violate, be in conflict
with, result in the breach of or constitute (with due notice, if applicable, or lapse of
time, or both) a default under any Legal Requirement or result in the creation or
imposition of any lien, charge or encumbrance of any nature whatsoever on the
Property other than the liens and security interests created by or expressly
permitted under the Loan Documents.
(E) BORROWER has (or prior to commencement of the construction referred to
herein will have) (i) received all requisite building permits and approvals in
connection with the Project, (ii) filed and/or recorded all requisite plats and other
instruments and (iii) complied or ensured the compliance with all Legal
Requirements required to be met prior to commencement of construction work
done in connection with the Project.
(F) All streets, easements, utilities and related services necessary for the construction
done in connection with the Project and the operation thereof for their intended
purpose are (or within thirty days prior to completion of construction work done
in connection with the Project, will be) available to the boundaries of the Property,
including, without limitation, potable water, storm and sanitary sewer, gas, electric
and telephone facilities and garbage removal.
(G) The Property has not been the site of any activity that'would violate any past or
present Legal Requirement, including, without limitation, any Environmental Law.
Specifically, without limitation, (i) no solid waste, as that term is defined in the
Texas Solid Waste Disposal Act, and no petroleum or petroleum products have
been handled on the Property such that they may have leaked or spilled on to the
Property or contaminated the Property, (ii) there is no. on -site contamination
resulting from activities on the Property or adjacent tracts, (iii) there is no off -site
contamination resulting from activities on the Property, (iv) the Property contain
no Hazardous Materials and (v) there are no underground storage tanks located in,
on or under the Property, and that CCCIC has obtained specific written assurance
from the BORROWER to such effect.
b
HOME loan agreement
(H) BORROWER has delivered to CCCIC duly executed documentation creating and
lawfully establishing BORROWER including evidence of any required filing with
the Secretary of State.
5.2 In the event that a dispute arises as to the legal authority to enter into this HOME LOAN
AGREEMENT of either the BORROWER or the person signing on behalf of BORROWER, and
same is not dismissed within ninety (90) days, CCCIC shall have the right, at its option, to either
temporarily suspend or permanently terminate this HOME LOAN AGREEMENT. Should
CCCIC suspend or permanently terminate this HOME LOAN AGREEMENT pursuant to this
paragraph, however, BORROWER shall be liable to CCCIC for any money it has received from
CCCIC for performance of any of the provisions hereof.
VI. MAINTENANCE OF EFFORT
6.1 BORROWER agrees that the funds and resources provided to it under the terms of this
HOME LOAN AGREEMENT shall in no way be substituted for funds and resources provided
from other sources, nor shall such funds and resources in any way serve to reduce the funds,
resources, services, or other benefits which would have been available to, or provided through,
BORROWER had this HOME LOAN AGREEMENT not been executed.
VII. PERFORMANCE BY BORROWER
7.1 BORROWER, in accordance and compliance with the terms, provisions and requirements
of this HOME LOAN AGREEMENT, shall manage, perform and provide all of the activities and
services required under this HOME LOAN AGREEMENT in connection with the Project to
CCCIC's satisfaction, in its reasonable determination and/or discretion. The funds available for
utilization hereunder shah be expended only in accordance with the terms of this HOME LOAN
AGREEMENT for the acquisition and construction of the Project. BORROWER shall submit a
Project budget and construction schedule ( "Construction Schedule ") within ten (20) days of the
execution of this HOME LOAN AGREEMENT.
VIII. DRAW REQUESTS
8.1 Provided no Event of Default (as defined in the Loan Documents) has occurred or remains
uncured, the CCCIC will deliver $400,000.00 to the J.P. Morgan Trust Company, National
Association (the "Trustee ") on the Closing Date (as such term is defined in the Loan Agreement
among the Corpus Christi Housing Finance Corporation, as "Issuer," the Trustee and Borrower)
to be used by the Borrower to acquire and construct the Project.
17X. INTENTIONALLY LEFT BLANK
X. INTENTIONALLY LEFT BLANK
XI. FURTHER REPRESENTATIONS, WARRANTIES AND COVENANTS
7
HOME loan agreement
11.1 BORROWER further represents and warrants that:
(A) All information, data or reports heretofore or hereafter provided to CCCIC is, shall
be and shall remain complete and accurate in all material respects as of the date
shown on the information, data or report, and that since said date shown, shall not
have undergone any significant adverse change without prior, written notice to
CCCIC;
(B) Any supporting financial statements heretofore or hereafter provided to CCCIC
are, shall be and shall remain complete, and accurate in -a11 material respects and
fairly reflective - of the financial condition of BORROWER on the date shown on
said statements and during the period covered thereby, and that since said date
shown, except as provided by written notice to CCCIC, there has been no material
change, adverse or otherwise, in the financial condition of BORROWER;
(C) No litigation or proceedings are presently pending or threatened, to
BORROWER's knowledge, against BORROWER;
(D) None of the provisions contained herein contravene or in any way conflict with the
authority under which BORROWER is doing business or with the provisions of
any- existing indenture or agreement of BORROWER;
(E) BORROWER has the legal authority to enter into this HOME LOAN
AGREEMENT and accept payments hereunder, and has taken all necessary
measures to authorize such execution of contract and acceptance of payments
pursuant to. the terms and conditions hereof, and
(F) None of the assets of BORROWER are currently and for the duration of this
HOME LOAN AGREEMENT subject to any lien or encumbrance of any
character, except for the other Liens (as such term is defined in the Deed of Trust)
securing the obligations of Borrower, current taxes not delinquent and except as
shown in the financial statements provided by BORROWER to CCCIC and except
as described in the other Loan Documents.
11.2 Except as otherwise provided in the Deed of Trust's Permitted Exceptions executed by
BORROWER and dated as of even date herein, and/or the Partnership Agreement, prior to and
during the period of time that payment may be made hereunder and so long as any payments
remain unliquidated, BORROWER covenants that it shall not, without the prior written consent
of CCCIC's General Manager or his designate, such consent not to be unreasonably delayed,
withheld or conditioned:
(A) Further mortgage, pledge, or otherwise encumber or cause to be encumbered any
of the assets of BORROWER now owned or hereafter acquired by it;
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HOME loan agreement
(B) Permit any pre - existing mortgages, liens, or other encumbrances to remain on or
attached to any of the assets of BORROWER which are allocated to the
performance of this HOME LOAN AGREEMENT and with respect to which
CCCIC has ownership hereunder;
(C) ' Sell, assign, pledge, transfer or otherwise dispose of accounts receivable, notes or
claims for money due or to become due;
(D) Sell, convey, or lease all or any substantial part of its assets other than for
residential use; or
(E) Make any advance or loan to, or incur any liability as guarantor, surety or
accommodation endorser for any other firm, person, entity or corporation.
11.3 Each of the foregoing representations, warranties and covenants shall be continuing and
deemed repeated each time BORROWER submits a new request for payment in accordance with
the terms, provisions and requirements of this HOME LOAN AGREEMENT.
X11. MAINTENANCE OF RECORDS
12.1 BORROWER agrees to maintain records that will provide accurate, current, separate, and
complete disclosure of the status of any funds received pursuant to this HOME LOAN
AGREEMENT. BORROWER further agrees:
(A) That maintenance of said records shall be in compliance with all terms, provisions
and requirements of this HOME LOAN AGREEMENT and with all applicable
federal and state regulations establishing standards for financial management; and
(B) That BORROWER's . record system shall contain sufficient, documentation to
. provide in detail full support and justification for each expenditure.
12.2 BORROWER agrees to retain, for the period of time and under the conditions specified by
CCCIC, all books, records, documents, reports, and written accounting policies procedures
pertaining to the operation of programs and expenditures of funds under this HOME •LOAN
AGREEMENT.
12.3 BORROWER agrees to include the substance of this Article in all of its sub - contracts.
12.4 Nothing in this Article shall be construed to relieve BORROWER of:
(A) Responsibility for retaining accurate and current records which clearly reflect the
level and benefit of services provided under this HOME LOAN AGREEMENT;
and
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HOME loan agreement
(B) Fiscal accountability and liability pursuant to this HOME LOAN AGREEMENT
and any Legal Requirements.
XM. ACCESSIBILITY OF RECORDS
13.1 At any reasonable time and as often as CCCIC may deem necessary, BORROWER shall
make all of its records available to CCCIC, HUD, or any of their authorized representatives, and
shall permit CCCIC, HUD, or any of their authorized representatives to audit, examine, and make
excerpts and/or copies of same. BORROWER's records shall include, but shall not be limited to,
the following: payroll, personnel and employment records, contracts, and invoices.
XIV. PERFORMANCE RECORDS AND REPORTS
14.1 As often and in such form as CCCIC may require, BORROWER shall furnish CCCIC such
performance records and reports as deemed by CCCIC as pertinent to matters covered by this
HOME LOAN AGREEMENT.
14.2 At minimum, monthly performance records and reports shall be submitted to CCCIC by
BORROWER no later than the tenth (10th) calendar day of the month following. Records and
reports shall be in accordance with the formats set forth by the CCCIC as required by federal
regulation.
14.3 As of the commencement date of this HOME LOAN AGREEMENT, BORROWER
agrees to gather, retain and make available to CCCIC information and data relative to all
programmatic and financial reporting.
XV. MONITORING AND EVALUATION
15.1 CCCIC shall perform on -site monitoring of BORROWER's performance pursuant to the
terms of this HOME LOAN AGREEMENT.
15.2 With reasonable notice to BORROWER, and in accordance with the leases affecting the
Property, BORROWER .agrees that CCCIC and HUD may, at CCCIC's and HUD's sole .
discretion, carry out monitoring and evaluation activities so as to ensure compliance by
BORROWER with this HOME LOAN AGREEMENT, with the Community Development Act,
with the HOME regulations, with the program assurances and certifications executed by CCCIC,
and with all other Legal Requirements.
153 BORROWER agrees to cooperate with CCCIC in the development, implementation and
maintenance of record - keeping systems and to provide CCCIC with any data determined by
CCCIC , in it's reasonable determination and/or discretion, to be necessary for its effective
fulfillment of its monitoring and evaluation responsibilities.
15.4 BORROWER agrees that it will cooperate with CCCIC and HUD in such a way so as not
to obstruct or delay CCCIC or HUD in its monitoring of BORROWER'S performance and that it
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HOME loan agreement
will designate one of its staff to coordinate the monitoring process as requested by CCCIC and /or
HUD staff.
15.5 After each official monitoring visit, CCCIC shall provide BORROWER with a written _
report of monitoring findings.
15.6 Copies of fiscal, management, or audit reports by any of BORROWER's funding or
regulatory bodies shall be submitted by BORROWER to CCCIC's General Manager or designate
within five (5) business days of receipt thereof by BORROWER.
XVI. BONDING AND INSURANCE
16.1 BORROWER shall observe sound business practices with respect to providing such
bonding and insurance as would provide adequate coverage for activities under this HOME
LOAN AGREEMENT; provided, however, that the foregoing provision of this paragraph shall in
no way be construed or deemed to limit or diminish the insurance requirements set forth in the
other Loan Documents with which BORROWER must comply and maintain.
16.2 . Upon signing this HOME LOAN AGREEMENT, and annually thereafter for the duration
of the Note, in addition to any other requirements and obligations of BORROWER in the other
Loan Documents, BORROWER shall provide CCCIC with: (1) proof of timely (i.e. before past
due) payment in full of all taxes assessed against the Property and (2) evidence of BORROWER's
current payment status on all loans in connection with the Property and the Project.
16.3 Premiums chargeable for any and all insurance referred' to in this Article be paid by
BORROWER, at its own expense, unless otherwise authorized in writing by CCCIC , and such
insurance shall be kept in. force during and throughout the term of this HOME LOAN
AGREEMENT. Such insurance shall not be materially changed, canceled, terminated or
otherwise allowed to expire unless thirty (30) calendar days advance written notice to such effect
is submitted to CCCIC, and it shall be the responsibility of BORROWER to ensure such
submission.
16.4 In addition to BORROWER's obligation set forth in the other Loan Documents to provide
CCCIC with Certificates of Insurance evidencing the above - required insurances prior to the
commencement of this HOME LOAN AGREEMENT and thereafter, BORROWER must provide
to. CCCIC certificates evidencing renewals or replacements of the policies of said insurance at
least thirty (30) calendar days prior to the expiration or cancellation of any such policies.
Additionally, BORROWER shall provide CCCIC evidence of the payment of all premiums
therefor.
16.5 Actual losses not covered by insurance as. required by this Article shall not be allowable
costs under this HOME LOAN AGREEMENT, and shall therefore remain the sole responsibility
of BORROWER.
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HOME loan agreement
16.6 Should BORROWER, either directly or indirectly, engage in any construction,
rehabilitation, or renovation type activities utilizing funds provided pursuant to this HOME
LOAN AGREEMENT, then the current and specific bonding and compliance provisions required
at that time shall prevail.
XVH. INDEMNIFICATION
17.1 BORROWER covenants and agrees to FULLY INDEMNIFY and HOLD
HARMLESS, the CCCIC and the elected officials, employees, officers, directors,
volunteers, agents and representatives of the CCCIC, individually or collectively,
from and against any and all costs, claims, liens, damages, losses, expenses, fees,
,Fines, penalties, proceedings, actions, demands, causes of action, liability and
suits of any kind and nature, including but not limited to, personal or bodily
injury, death and property damage, made upon the CCCIC, directly or indirectly
arising out of, resulting from or related to BORROWER's activities under this
HOME L OAN A GREEMENT, including any acts or omissions of B ORROWER,
any agent, officer, director, representative, employee, consultant, contractor or
subcontractor of BORROWER, and their respective officers, agents, employees,
directors and representatives while in the exercise or performance of the rights
or duties under this HOME LOANAGREEMENT, all without, however, waiving
any governmental immunity available to the CCCIC under Texas law and
without waiving any defenses of the parties under Texas law. IT IS FURTHER
COVENANTED AND AGREED THAT SUCH INDEMNITY SHALL APPLY
EVEN WHERE SUCH COSTS, CLAIMS, LIENS, DAMAGES, LOSSES,
EXPENSES, FEES, FINES, PENALTIES, ACTIONS, DEMANDS, CAUSES
OF ACTION, LIABILITY AND /OR SUITS ARISE IN ANY PART FROM THE
NEGLIGENCE OFCCCIC, THE ELECTED OFFICIALS, EMPLOYEES,
OFFICERS, DIRECTORS, VOLUNTEERS, AGENTS, AND
REPRESENTATIVES OF CCCIC, UNDER THIS HOME LOAN
AGREEMENT. The provisions of this INDEMNIFICATION are solely for the
benefit of the parties hereto and not intended to create or grant any rights,
contractual or otherwise, to any other person or entity. BORROWER . shall
promptly advise the CCCIC in writing of any claim or demand against the
CCCIC or BORROWER known to BORROWER related to or arising out of
BORROWER's activities under this HOME LOANAGREEMENT and shall see
to the investigation and defense of such claim or demand at BORROWER's cost
The CCCIC shall have the right, at its option and at its own expense, to
participate in such defense without relieving BORROWER of any of its
obligations under this paragraph.
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HOME loan agreement
17.2 It is the EXPRESS INTENT of the parties to this HOME LOAN
AGREEMENT that the INDEMNITY provided for in this Article (Article XYII)
is an INDEMNITY extended by BORROWER to INDEMNIFY, PROTECT, and
HOLD HARMLESS the CCCIC from the consequences of the CCCIC OWN
NEGLIGENCE, provided however, that the INDEMNITY provided for in this
Article SHALL APPLY only when the NEGLIGENT ACT of the CCCIC is a
CONTRIBUTORY OR CONCURRENT CAUSE of the resultant injury, death,
or damage, and shall have no application when the negligent act of the CCCIC is
the sole cause of the resultant injury, death or damage BORROWER further
AGREES TO DEFEND, AT ITS OWN EXPENSE and ON BEHALF OF
THECCCIC AND IN THE NAME OF THE CCCIC, any claim or litigation
brought against the CCCIC and its elected officials, employees, officers,
directors, volunteers, agents, and representatives, in connection with any such
injury, death, or damage for which this INDEMNITY shall apply, as set forth
above.
17.3 It is expressly understood and agreed that BORROWER is and shall be deemed to
be an independent contractor and operator responsible to all parties for its respective acts
or omissions and that CCCIC shall in no way be responsible therefor.
XVM. EQUAL EMPLOYMENT OPPORTUNITY AND A ACTION
18.1 BORROWER shall comply with all applicable local, state and federal equal employment
opportunity and affirmative action rules, regulations and laws.
18.2 So that CCCIC and HUD can investigate compliance with local, state and federal equal
employment opportunity and affirmative action rules, regulations and laws, BORROWER shall
fin to CCCIC and HUD any and all information and reports requested by CCCIC or HUD,
and shall permit access by CCCIC or . HUD of any and all of its books, records and accounts.
18.3 In the event of non - compliance by BORROWER (or BORROWEWs sub - contractors)
with local, state and federal equal employment opportunity and affirmative action rules,
regulations and laws, this HOME LOAN AGREEMENT may be canceled, terminated, or
suspended by CCCIC, in whole . or in part, and BORROWER may be barred from further
contracts with CCCIC.
XIX. NONDISCRIMINATION
19.1 BORROWER covenants that it, or its agents, employees or anyone under its control, will
not discriminate against any individual or group on account of race, color, sex, age, religion,
national origin, handicap or familial status, in employment practices or in the use of or admission
to the Property, which said discrimination BORROWER acknowledges is prohibited.
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HOME loan agreement
XX. CONFLICT OF INTEREST
20.1 BORROWER covenants that neither it nor any member of its governing body or of its
staff presently has any interest, direct or indirect, which would conflict in any manner or degree
with the performance of services required to be performed under this HOME LOAN
AGREEMENT. BORROWER further covenants that in the performance of this HOME LOAN
AGREEMENT, no persons having such interest shall be employed or appointed as a member of
its governing body or of its staff.
20.2 BORROWER further covenants that no member of its governing body or of its staff shall
possess any interest in, or use their position for, a purpose that is or gives the. appearance of being
motivated by desire for private gain for themselves or others, particularly those with which they
have family, business, or other ties.
20.3 No member of CCCIC's governing body or of its staff who exercises any function or
responsibility in the review or approval of the undertaking or carrying out of this DOME LOAN
AGREEMENT shall:
(A) Participate in any decision relating to this HOME LOAN AGREEMENT, which
may affect his or her personal interest or the interest of any corporation,
partnership, or association in which he or she has a direct or indirect interest; or
(B) Have any direct or indirect interest in this HOME LOAN AGREEMENT or the
proceeds thereof.
XXI. NEPOTISM
21.1 BORROWER shall not employ in any paid capacity any person who is a member of the
immediate family of any person who is currently employed by BORROWER or who is a member
of BORROWER's governing body. The term "member of immediate family" shall include: wife,
husband, son, daughter, mother, father, brother, sister, in -law aunt, uncle, cousin, nephew, niece,
step - parent, step - child, half - brother and half - sister.
XXH. POLITICAL ACTIVITY
22.1 None of the performance rendered hereunder shall involve, and no portion of the funds
received hereunder shall be used, either directly or indirectly, for any political activity including,
but not limited to, an activity to further the election or defeat of any candidate for public office or
for any activity undertaken to influence the passage, defeat or final content of local, state or
federal legislation.
XXM. SECTARIAN ACTIVITY
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HOME loan agreement
23.1 None of the performance rendered hereunder shall involve, and no portion of the funds
received hereunder shall be used, directly or indirectly, for the construction, operation,
maintenance or administration of any sectarian or religious facility or activity, nor small said
performance rendered or funds received be utilized so as to benefit, directly or indirectly, any such
sectarian or religious facility or activity.
XXIV. INTENTIONALLY DELETED
XXV. PUBLICITY
25.1 When appropriate, as determined by and upon written approval of CCCIC, BORROWER
shall publicize the activities conducted by BORROWER pursuant to the terms of this HOME
LOAN AGREEMENT. In any news release, sign, brochure, or other advertising medium
disseminating information prepared or distributed by or for BORROWER, however, mention shall
be made of HUD funded CCCIC participation having made this Project possible.
XXVI. PUBLICATIONS
26.1 All published materials and written reports submitted pursuant to this HOME LOAN
AGREEMENT shall be originally developed unless otherwise specifically provided for herein.. If
material not originally developed is included in a report, however, said material shall have its
source identified, either in the body of the report or by footnote, regardless of whether the
material is a verbatim or extensive paraphrase format.
26.2 All published materials submitted pursuant to this Project shall include the following
reference on the front cover or title page:
"This document was prepared in accordance with the City of
Corpus Christi's HOME Investment Partnership Program, with
funding received from the United States Department of Housing
and Urban Development."
XXVII. RIGHTS TO PROPOSAL AND CONTRACTUAL MATERIAL
27.1 All finished or unfinished reports, documents, data, studies, surveys, charts, drawings,
maps, models, photographs, designs, plans, schedules, or other appended documentation to any
proposal or contract, and any responses, inquiries, correspondence and related material submitted
by BORROWER, shall, upon receipt, become the property of CCCIC.
XXVIII. FUNDING APPLICATIONS
28.1 BORROWER agrees to notify CCCIC each time BORROWER is preparing or submitting
any application for funding (other than as set forth in the Deed of Trust's Permitted
Encumbrances and/or the Partnership Agreement). When so preparing or submitting such an
application, the following procedures shall be adhered by BORROWER:
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HOME loan agreement
(A) When the funding application is in the planning stages, a description of the funds
being applied for and of the proposed use for the funds shall be submitted by
BORROWER to CCCIC;
(B) Upon award or notice of award, whichever is sooner, BORROWER shall notify
CCCIC of the award or notice thereof, and of the effect, if any, of such funding on
the funds and programs agreed to hereunder. Such notice shall be submitted by
BORROWER to CCCIC, in writing, within ten (10) business days of receipt of the
award or notice thereof, together with copies of the applicable budget, personnel
complement, program description, and contract; and
(C) Except pursuant to prior written consent of CCCIC, BORROWER shall not use,
either directly or indirectly, resources provided hereunder to prepare applications
for other federal, other public or private funds, nor shall said resources be used,
directly or indirectly, as contributions.
XXIX. CERTIFICATION REGARDING DEBARMENT, SUSPENSION.
PROPOSED DEBARMENT AND OTHER
RESPONSIBILITY MATTERS
29.1 BORROWER certifies, and the CCCIC relies thereon in execution of this HOME LOAN
AGREEMENT, that neither BORROWER nor its Principals are presently debarred, suspended,
proposed for debarment, or declared ineligible, or voluntarily excluded for the award, proposed
for debarment, or declared ineligible, or voluntarily excluded for the award of contracts by any
Federal governmental agency or department.
29.2 "Principals," for the purposes of this certification, means officers, directors, owners,
partners, and persons having primary management or supervisory responsibilities within a business
entity (e.g., general manager, plant manager, head of subsidiary, division, or business segment,
and similar positions).
29.3 BORROWER shall provide immediate written notice. to CCCIC, in accordance with
Article XLIV, if, at any time during the term of this HOME LOAN AGREEMENT, including any
renewals hereof, BORROWER learns that its certification was erroneous when made or has
become erroneous by reason of changed circumstances.
29.1 BORROWER's certification is a material representation of fact upon which the CCCIC
has relied in entering into this HOME LOAN AGREEMENT. Should CCCIC determine, at any
time during this HOME LOAN AGREEMENT, including any renewals hereof, that this
certification is false, or should it become false due to changed circumstances, the CCCIC may
terminate this HOME LOAN AGREEMENT in accordance with Article XXXIV Termination.
XXX. SUB - CONTRACTING
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HOME loan agreement
30.1 Any other clause of this HOME LOAN AGREEMENT to the contrary notwithstanding,
none of the work or services covered by this HOME LOAN AGREEMENT shall be sub-
contracted without the prior written approval of CCCIC. Any work or services approved for sub-
contracting hereunder, however, shall be sub - contracted only by written contract or agreement.
and, unless specific waiver is granted in writing by CCCIC, shall be subject by its terms to each
and every provision of this HOME LOAN AGREEMENT. Compliance by sub - contractors with
this HOME LOAN AGREEMENT shall be the responsibility of BORROWER.
30.2 BORROWER agrees that no sub - contract approved pursuant to this HOME LOAN
AGREEMENT shall provide for payment on a "cost plus a percentage of cost" basis.
30.3 Despite CCCIC approval of a sub - contract, CCCIC shall in no event be obligated to any
third party, including any sub - contractor of BORROWER, for performance of work or services,
nor shall CCCIC funds ever be used for payment of work or services performed prior to the date
of HOME LOAN AGREEMENT execution or extending beyond the date of HOME LOAN
AGREEMENT expiration.
XXXI. CHANGES AND AMENDMENTS
31.1 Except when the terms of this HOME LOAN AGREEMENT expressly provide
otherwise, any alterations, additions, or deletions to the terms hereof shall be by amendment in
writing executed by authorized representatives of both CCCIC and BORROWER.
31.2 Whenever and as often as deemed necessary by CCCIC , CCCIC may request and require
changes to BORROWER's Construction Schedule required under this HOME LOAN
AGREEMENT (to be submitted in accordance with Article VII); such changes as requested or
required by CCCIC, however, must be by written amendment hereto and may incorporate therein
increases or decreases in the total monetary obligation of CCCIC to BORROWER as provided
for pursuant to the terms, provisions and conditions of this HOME LOAN AGREEMENT.
31.3 Except pursuant to (a) prior submission by BORROWER of detailed information
regarding budget and Project revisions, and (b) prior written approval thereof by ,CCCIC,
BORROWER shall neither make transfers between or among line items approved within the
budget categories set forth in the Construction Schedule nor shall BORROWER alter, add to, or
delete from the Construction Schedule. Instead, BORROWER shall request budget revisions in
writing and in a form prescribed by CCCIC; such request for revisions, however, shall not
increase the total monetary obligation of CCCIC as provided for pursuant to this HOME LOAN
AGREEMENT, nor shall said revisions significantly change the nature, intent, or scope of the
Project funded hereunder.
31.4 In the event that the level of funding for BORROWER or for the Project described herein
is altered, BORROWER shall submit, immediately upon request by CCCIC, revised budget and
Project information so as to enable re- evaluation by CCCIC of the original funding levels set forth
in the Construction Schedule.
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HOME loan agreement
31.5 It is understood and agreed by the parties hereto that changes in local, state and federal
rules, regulations or laws applicable hereto may occur during the term of this HOME LOAN
AGREEMENT and that any such changes shall be automatically incorporated into this HOME
LOAN AGREEMENT without written amendment hereto, and shall become a part hereof as of
the effective date of the rule, regulation or law.
31.6' BORROWER further agrees to notify CCCIC of any changes in personnel or governing
board composition, such notice to be provided within five (5) business days of the change.
XXXII. NOTICE AND CURE
32.1 Notwithstanding anything to the contrary set forth herein or in any of the other Loan
Documents, where it is determined that BORROWER has failed to comply with any of the terms
and/or conditions of this HOME LOAN AGREEMENT and/or any of the terms of any of the
other Loan Documents, CCCIC shall notify BORROWER of such determination and shall grant
BORROWER ten (10) days to complete corrective monetary violations or defaults and thirty (30)
days to complete corrective non - monetary violations or defaults prior to enforcing any of it
remedies set forth herein or in any of the other Loan Documents.
XXXIII. SUSPENSION OF FUNDING
33.1 Upon reasonable determination by CCCIC of BORROWER's failure to timely and
properly perform pursuant to the provisions of this HOME LOAN AGREEMENT beyond any
applicable notice and cure period, or of any of the other Loan Documents beyond any applicable
notice and cure period, CCCIC, without limiting or waiving any rights it may otherwise have,
may, at its discretion, withhold any, all and further payments to BORROWER-
33.2 The period of funding suspension shall be of such duration as CCCIC deems appropriate
to accomplish corrective action, but in no event shall it exceed thirty (30) calendar days. Upon
expiration of the suspension period:
(A) Should CCCIC determine that the default or deficiency has been cured,
BORROWER may, at CCCIC's option, be restored to full compliance status and
paid all eligible funds withheld during the suspension period; or
(B) Should CCCIC determine continued non - compliance, the provisions of Article
XXXIV hereunder may be effectuated.
XXXIV. TERMINATION
31.1 "Termination" of this HOME LOAN AGREEMENT shall mean termination by expiration
of the HOME LOAN AGREEMENT term or earlier termination pursuant to any of the provisions
hereof.
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HOME loan agreement
34.2 CCCIC may terminate this HOME LOAN AGREEMENT for any of the following
reasons:
(A) Neglect or failure by BORROWER to perform or observe any of the terms,
conditions, covenants or guarantees of 1) this HOME LOAN AGREEMENT, 2)
any of the other Loan Documents, or 3) any other valid, written contract or
amendment between CCCIC and BORROWER, beyond any applicable notice and
cure period;
(B) Termination or reduction of funding of the Project by HUD,
(C) . Failure by BORROWER to timely cure, any default or deficiency basis for
- suspension of funding hereunder within any applicable notice and cure period;
(D) Finding by CCCIC that BORROWER:
(1) is in such unsatisfactory financial condition as to endanger performance
under this HOME LOAN AGREEMENT, including, but not limited to:
(a) The apparent inability of BORROWER to meet its financial
obligations;
(b) Items that reflect detrimentally on the credit worthiness of
BORROWER, including, but not limited to, liens, encumbrances,
etc., on the assets of BORROWER;
(2) has allocated inventory to this HOME LOAN AGREEMENT materially
exceeding reasonable requirements; or
(3) is delinquent, in the ordinary course of business, in the payment of taxes or
in the payment of costs of performance of or related to this HOME LOAN
AGREEMENT or the Project;
(E) Appointment of a trustee, receiver or liquidator for all or a material part of
BORROWER's Property, or institution of bankruptcy, reorganization,
rearrangement of or liquidation proceedings by or against BORROWER, and the
same is not dismissed within ninety (90) days;
(F) The entry by a court of competent jurisdiction of a final order providing for the
modification or alteration of the rights of BORROWER's creditors;
(G) Inability by BORROWER to conform to changes in local, state and federal rules,
regulations and laws as provided for in Article IV and in paragraph number 31.5 of
this HOME LOAN AGREEMENT and all Legal Requirements; and
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HOME loan agreement
(M1% Violation by BORROWER of any rule, regulation or law to which BORROWER
is bound or shall be bound under the terms of this HOME LOAN AGREEMENT.
34.3 BORROWER may terminate this HOME LOAN AGREEMENT for any of the following
reasons:
(A) Cessation of outside funding upon which BORROWER depends for performance
hereunder; BORROWER may opt, however, within the limitations of this HOME
LOAN AGREEMENT and with the written approval of CCCIC, to seek an
alternative funding source, provided that the termination of funding by the initial
outside source was not occasioned by a breach of agreement as defined herein or
as defined in a contract between BORROWER and the funding source .in question;
'or
(B) Upon the dissolution of the BORROWER organization, provided such dissolution
was not occasioned by a breach of this HOME LOAN AGREEMENT.
34.4 Upon a decision to terminate by either CCCIC or BORROWER, written notice of such,
and the effective date thereof, shall be immediately provided to the other party.
34.5 Upon receipt of notice to terminate, BORROWER shall cancel, withdraw, or otherwise
terminate any and all outstanding orders and subcontracts, which relate to the performance of this
HOME LOAN AGREEMENT and the Project. To this effect, CCCIC shall not be liable to
BORROWER or BORROWER's creditors for any expense, encumbrances or obligations
whatsoever incurred after the date of termination or which was not canceled, withdrawn or
otherwise terminated by BORROWER in accordance with the provisions of this paragraph.
34.6 Upon receipt of notice to terminate, all finished or unfinished documents, data, studies,
surveys, charts, drawings, maps, models, photographs, designs, plans, schedules, or other
appended documentation to any proposal or contract, prepared by or on behalf of BORROWER
under this HOME LOAN AGREEMENT shall, at the option of CCCIC, and in accordance with
Article XXVH hereof, become the property of CCCIC and shall, if requested or agreed to by
CCCIC, be delivered by BORROWER to CCCIC in a timely and expeditious manner.
34.7 Within thirty (30) calendar days after receipt of notice to terminate, BORROWER shall
submit a statement to CCCIC, indicating in detail the services performed under this HOME
LOAN AGREEMENT prior to the effective date of termination.
34.8 Any termination of this HOME LOAN AGREEMENT as herein provided shall not relieve
BORROWER from the payment of any sum(s) that shall then be due and payable or become due
and payable to CCCIC hereunder or as provided for at law or in equity, or any claim for damages
then or theretofore accruing against BORROWER hereunder or by law or in equity, and any such
termination shall not prevent CCCIC from enforcing the payment of any such sum(s) or claim for
damages from BORROWER. Instead, all rights, options, and remedies of CCCIC contained in
this HOME LOAN AGREEMENT shall be construed and held to be cumulative and no one of
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HOME loan agreement
them shall be exclusive of the other, and CCCIC shall have the right to pursue any one or all of
such remedies or any such other remedy or relief may be provided by law or in equity
whether or not stated in this HOME LOAN AGREEMENT.
34.9 Should this HOME LOAN AGREEMENT be terminated by either party hereto for any
reason, if the work required hereunder of BORROWER is not fully completed to the reasonable
satisfaction of CCCIC in accordance with the terms of this HOME LOAN AGREEMENT,
BORROWER shall refund any and all sums of money paid by CCCIC to BORROWER within ten
(10) business days of CCCIC's written request therefor.
34.10 Upon termination of this HOME LOAN AGREEMENT by CCCIC under paragraph
number 35.2(A) hereof, BORROWER shall be barred from future contracts with CCCIC absent
the express written consent of the General Manager, or his designate, to contract with CCCIC.
XXXV. NOTIFICATION OF ACTION BROUGHT
35.1 In the event that any claim, demand, suit, proceeding, cause of action or other action
(hereinafter collectively referred to as "claim ") is made or brought against BORROWER,
BORROWER shall give written notice thereof to CCCIC within five (5) business days after itself
being notified. BORROWER's notice to CCCIC shall state the date and hour of notification to
BORROWER of the claim; the names and addresses of those instituting or threatening to institute
the claim, the basis of the claim; and the name(s) of any others against whom the claim is being
made or threatened. Written notice pursuant to this Article shall be delivered either personally or
by mail in accordance with Article XLIV of this HOME LOAN AGREEMENT.
XXXVL ASSIGNMENTS
36.1 Except as provided for in the Partnership Agreement, BORROWER shall not transfer,
pledge or otherwise assign this HOME LOAN AGREEMENT, any interest in and to same, or any
claim arising thereunder, without first procuring the written approval of CCCIC's General
Manager. Any attempt at transfer, pledge or other assignment shall be void ab initio and shall
confer no rights upon any third person.
XXXVII. NO WAIVER OF PROVISIONS OR COMPLIANCE
37.1 Any failure by CCCIC to insist, or any election by CCCIC not to .insist, upon the strict
performance by BORROWER or any guarantor of the Project or the Loan, of any of the terms,
provisions or conditions of the Loan Documents shall not be deemed to be a waiver of same or of
any other terra, provision or condition thereof, and CCCIC shall have the right at any time
thereafter to insist upon strict performance by BORROWER of any and all of same. Additionally,
no advance by CCCIC of any Loan proceeds shall in any way preclude CCCIC from thereafter
declaring a failure by BORROWER to comply with any of the terms, provisions or conditions of
the Loan Documents an event of default or, as applicable, a reason for termination in accordance
with Article XXXIV hereof.
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HOME loan agreement
XXXVIII. SEVERABILITY OF PROVISIONS
38.1 If any clause or provision of this HOME LOAN AGREEMENT is held invalid, illegal or
unenforceable under present or future federal, state or local laws, including but not limited to the
CITY'S City Charter, CITY'S City Code, or ordinances of the City of Corpus Christi, Texas, then
and in that event it is the intention of the parties hereto that such invalidity, illegality or
unenforceability shall not affect any other clause or provision hereof and that the remainder of this
HOME LOAN AGREEMENT -shall be construed as if such invalid, illegal or unenforceable
clause or provision was never contained herein; it is also the intention of the parties hereto that in
lieu of each clause or provision of this HOME LOAN AGREEMENT that is invalid, illegal, or
unenforceable, . there be added as a part of the HOME LOAN AGREEMENT a clause or
provision as similar in terms to such invalid, illegal or unenforceable clause or provision as may be
possible, legal, valid and enforceable.
XXXIX. RENEWAL NOT AUTOMATIC
39.1 Funding under this HOME LOAN AGREEMENT and any amendments or waivers that
may be made or granted hereunder shall not be automatically renewed on the anniversary date of
this HOME LOAN AGREEMENT. To the contrary, funding of any project requiring contract
execution shall be achieved only pursuant to approval of the City Council of the City of Corpus
Christi and the governing body of the CCCIC.
XL. NON - WAIVER OF PERFORMANCE
40.1 No waiver by CCCIC of a breach of any of the terms conditions, covenants or guarantees
of this HOME LOAN AGREEMENT shall be construed or held to be a waiver of any succeeding
or preceding breach of the same or any other term, condition, covenant or guarantee herein
contained. Further, any failure of CCCIC to insist in any one or more cases upon the strict
performance of any of the covenants of this HOME LOAN AGREEMENT, or to exercise any
option herein contained, shall in no event be construed as a waiver or relinquishment for the
future of such covenant or option. In fact, no waiver, change, modification or discharge by either
party hereto of any provision of this HOME LOAN AGREEMENT shall be deemed to have been
made or shall be effective unless expressed in writing and signed by the party to be charged.
40.2 No act or omission of CCCIC shall in any manner impair or prejudice any right, power,
privilege, or remedy available to CCCIC hereunder or by law or in equity, such rights, powers,
privileges, or remedies to be always specifically preserved hereby.
40.3 No representative or agent of CCCIC may waive the effect of the provisions of this
Article.
XLI. SPECIAL CONDITIONS
41.1 BORROWER shall prepare accurate and complete monthly performance measures reports
and submit to the CCCIC on or before the tenth (10 "') day of each month, with each report
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HOME loan agreement
reflecting the previous month: Each such report shall contain details of all inputs (i.e., resources)
and outputs (i.e., utilization of resources) in conjunction with efficiency and effectiveness
measures regarding the Project. The form of each report must meet the approval of CCCIC, and
BORROWER agrees to make any and all changes to such form as may be recommended by
CCCIC, as well as provide additional information in connection with such reports as may be
requested by CCCIC.
41.2 BORROWER shall ensure that all professional and contractual services in connection with
Project implementation shall be procured in accordance with 24 CFR 570, Part 85, The Common
Rule, Procurement, Competitive Standards and all other federal laws and regulations applicable to
the Project.
41.3 INTENTIONALLY LEFT BLANK.
41.4 INTENTIONALLY LEFT BLANK.
41.5 BORROWER understands and acknowledges that CCCIC shall not be liable for any cost,
or portion thereof, which is or was incurred in connection with an activity of BORROWER where
prior written authorization from CCCIC is required for the activity and such authorization was
not first procured, or CCCIC has requested that BORROWER fi;rnish data concerning an activity
prior to proceeding further therewith and BORROWER nonetheless proceeds without first
submitting the data and receiving approval thereof.
41.6 BORROWER shall forward to CCCIC for approval a completed copy of Homeownership
Assistance/Rental Housing Project Setup Report (HUD farm 40094) for the HOME Program
Integrated Disbursement Information System (IDIS) for each activity under this HOME LOAN
AGREEMENT, prior to initiating any activities and/or incurring any Project activity cost.
41.7 BORROWER understands and agrees that Davis -Bacon Wage and Hour Requirements
shall apply to HOME funded projects when, in accordance with 24 CFR 92.354, twelve (12) or
more units are rehabilitated or newly constructed. BORROWER agrees to include said wage
requirements in all bid advertisements and shall require same in all relevant third -party contracts,
prior to the commencement of any construction activity.
41.8 BORROWER shall accurately complete a Project Completion Report (HUD form 40096)
upon completion of each Project activity, and forward the original completed form to the CCCIC
within thirty (30) business days after BORROWER's receipt of the final remittance of HOME
LOAN AGREEMENT funds by CCCIC for such Project activity. BORROWER understands and
acknowledges that new Project Set -up Reports will not be processed by CCCIC if there are any
outstanding Project Completion Reports due.
41.9 BORROWER shall ensure that all units constructed with assistance made available to
BORROWER by CCCIC under this HOME LOAN AGREEMENT shall comply with the
provisions set forth in 24 CFR 92.251, Property Standards and shall comply with the CITY's City
codes .
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HOME loan agreement
41.10 BORROWER shall .complete all Site Specific Environmental Review Records for each
propertylparcel of this Project and submit such records to CCCIC. CCCIC must approve in
writing such records prior to any Project activity cost being incurred.
41.11 To the greatest extent feasible, agreements for work to be performed in connection with
this Project shall - be awarded to business concerns including, but not limited to, individuals or
firms doing business in the field. of planning, consulting, design, architecture, building
construction, rehabilitation, maintenance, or repair, that are located in or owned in substantial part
by persons residing in the same metropolitan area or non - metropolitan county as this Project.
41.12 BORROWER understands and agrees that all HOME assisted units in the Project herein,
shall only be leased to and occupied by households that are eligible as low - income families, in
accordance with HUD Section 8 Income Guidelines.
41.13 BORROWER shall determine whether the HOME assisted units in the Project herein shall
be fixed or floating, and provide said information to CCCIC immediately upon its determination.
BORROWER understands and agrees that time is of the essence in making said determination.
41.14 BORROWER understands and agrees that, pursuant to 24 CFR 92.252, its maximum or
High rents for its HOME assisted affordable units in the Project herein shall be the lesser of..
(A) The fair market rent for existing housing for comparable units in the area as
established by HUD under 24 CFR 888.111; or
(B) A rent that does not exceed thirty percent (30 %) of the adjusted income of a
family whose annual income equals sixty -five percent (65 %) of the median income
for the area, as determined by HUD, with adjustments for the number of bedrooms
in the unit.
41.15 BORROWER shall, in accordance with all applicable HOME regulations, determine and
utilize rent schedules and limits. that ensure that the rent charged for all Project units remains in
compliance with the HOME regulations and standards during the period of affordability.
Furthermore, BORROWER shall lease to qualified families not less than the minimum allowed
percentage of Low and High rent HOME assisted affordable units required under the HOME
regulations during the period of affordability.
41.16 BORROWER further understands and agrees that Low rent HOME assisted affordable
units must meet one (1) of the following Low HOME rent requirements:
(A) The rent shall not exceed thirty percent (30 %) of the annual income of a family
whose income equals fifty percent (50 %) of the median income for the area, as
determined by HUD, with adjustments for smaller and larger families; or
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HOME loan agreement
(B) The rent shall not exceed thirty percent (30 %) of the family's adjusted monthly
income. If the unit receives Federal or State project -based rental subsidy and the
very low- income family pays, as a contribution toward rent, not more than thirty
percent (30 %) of the family's adjusted income, then the maximum rent (i.e., tenant
contribution plus project -based rental subsidy) is the rent allowable under the
Federal or State project -based rental subsidy program.
41.17 INTENTIONALLY LEFT BLANK.
41.18 INTENTIONALLY LEFT BLANK.
41.19 BORROWER shall not discriminate against any certificate or voucher holder in
accordance to 24' CFR Part 982, Section 8, Tenant Based Assistance: Unified Rule for Tenant -
Based Assistance under the Section 8 Rental Certificate Program and the Section 8 Rental
Voucher Program or to the holder of a comparable document evidencing participation in a
HOME tenant -based rental assistance program.
41.20 BORROWER understands and agrees that HOME assisted units shall meet the
affordability requirements for not less than twenty (20) years, commencing upon Project
completion.
41.21 CCCIC shall provide BORROWER with information on updated HUD HOME rent limits
so that rents may be adjusted (not to exceed the maximum HOME rent limits provided by HUD
to CCCIC upon HUD's determination of fair market rents and median incomes) in accordance
with this HOME LOAN AGREEMENT. BORROWER shall annually provide CCCIC with
documentation on rents and occupancy of HOME assisted units to demonstrate compliance.
41.22 BORROWER understands and agrees that any increase in rents for HOME assisted units
is subject to the provisions of outstanding leases, and in any event, BORROWER shall provide
tenants of those units not less than thirty (30) days prior written notice before implementing any
increase in rents.
41.23 BORROWER understands and agrees that the income of each tenant shall be determined
initially in accordance with 24 CFR 92.203(a)(1)(i). BORROWER shall annually re- examine each
tenant's annual income during the period of affordability in accordance with one of the options in
24 CFR 92.203.
41.24 BORROWER shall ensure that HOME assisted units continue to qualify as affordable
housing despite a temporary noncompliance caused by increases in the incomes of existing tenants
if actions satisfactory to CCCIC are being taken to ensure that all vacancies are filled in
accordance with 24 CFR 92.252 until the noncompliance is corrected.
41.25 BORROWER shall ensure that tenants who no longer qualify as low- income families must
pay, as rent, the lesser of the amount payable by the tenant under State or local law or thirty
percent (30 %) of the family's adjusted income, except that tenants of HOME assisted units that
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HOME loan agreement
have been allocated low- income housing tax credits by a housing credit agency pursuant to
section 42 of the Internal Revenue Code of 1986 (26 U.S.C. 42) must pay rent governed by
section. 42. If BORROWER has designated the HOME units as floating pursuant to Section
41.13 herein, BORROWER shall not require tenants who no longer qualify as low- income to pay,
as rent, an amount that exceeds the market rent for comparable, unassisted units in the
neighborhood.
41.26 BORROWER shall submit to CCCIC a post - construction appraisal promptly upon
completion of the Project.
41.27 BORROWER acknowledges, understands and agrees to comply with the following
federal regulations as promulgated in Section 3 Clause of the Housing and Urban Development
Act of 1968, as amended, if applicable:
(A) The work to be performed under this HOME LOAN AGREEMENT is subject to
the requirements of Section 3 of the Housing and Urban Development Act of
1968, as amended, 12 U.S.C. 170lu (Section 3). The purpose of Section 3 is to
ensure that employment and other economic opportunities generated by HUD
assistance or HUD- assisted projects covered by Section 3, shall, to the greatest
extent feasible, be directed to low- and very low income persons, particularly
persons who are recipients of HUD assistance for housing.
(B) The parties to this HOME LOAN AGREEMENT agree to comply with HUD's
regulations in 24 CFR Part 135, which implement Section 3. As evidenced by their
execution of this HOME LOAN AGREEMENT, the parties to this HOME LOAN
AGREEMENT certify that they are under no contractual or other impediment that
would prevent them from complying with the Part 135 regulations.
(C) The BORROWER agrees to send to each labor organization or representative of
workers with which the contractor has a collective bargaining agreement or other
understanding, if any, a notice advising the labor organization or workers'
representative of the contractor's commitments under this Section 3 clause, and
will post copies of the notice in conspicuous places at the work site where both
employees and applicants for training and employment positions can see the notice.
The notice shall describe the Section 3 preference, shall set forth minimum number
and job titles subject to hire, availability of apprenticeship and training positions,
the qualifications for each; and the name and location of the person(s) taking
applications for each of the positions; and the anticipated date the work shall
begin.
(D) BORROWER agrees to include this Section 3 clause in every subcontract subject
to compliance with regulations in 24 CFR Part 135, and agrees to take appropriate
action, as provided in an applicable provision of the subcontract or in this Section
3 clause upon a finding that the subcontractor is in violation of the regulations in
24 CFR Part 135. BORROWER will not subcontract with any subcontractor
26
HOME loan agreement
where BORROWER has notice or knowledge that the subcontractor has been
found in violation of the regulations in 24 CFR Part 135.
(E) BORROWER will certify that any vacant employment positions, including training
positions, that are filled (1) after contractor is selected but before the contract is
executed, and (2) with persons other than those to whom the regulations of 24
CFR Part 135 require employment opportunities to be directed, were -not filled to
circumvent BORROWER's obligations under 24 CFR Part 13 5.
(F) Noncompliance with HUD's regulations in 24 CFR Part 135 may result in
sanctions, termination of this HOME LOAN AGREEMENT for default, and
debarment or suspension from further HUD - assisted contracts.
(G) With respect to work performed in connection with Section 3 covered Indian
housing assistance, Section 7(b) of the Indian Self - Determination and Education
Assistance Act (25 U.S.C. 450e) also applies to the work to be performed under
this HOME LOAN AGREEMENT. Section 7(b) requires that to the greatest
extent feasible (i) preference and opportunities for training and employment shall
be given to Indians, and (ii) preference in the award of contracts and subcontracts
shall be given to Indian organizations and Indian-owned Economic Enterprises.
Parties to this contract that are subject to the provision of Section 3 and Section
7(b) agree to comply with Section 3 to the maximum extent feasible, but not in
derogation of compliance with Section 7(b).
XLII. ENTIRE - AGREEMENT
42.1 This HOME LOAN AGREEMENT, along with the other Loan Documents, constitutes
the final and entire agreement between the parties hereto and contains all of the terms and
conditions agreed upon. No other agreements, oral or otherwise, regarding the subject matter of
this HOME LOAN AGREEMENT shall be deemed to exist or to bind the parties hereto unless
same be in writing, dated subsequent to the date hereof, and duly executed by the parties.
XLIII. INTERPRETATION
43.1 In the event any disagreement or dispute should arise between the parties hereto pertaining
to the interpretation or meaning of any part of this HOME LOAN AGREEMENT or its
governing rules, regulations, laws, codes or ordinances, CCCIC, as the party ultimately
responsible to HUD for matters of compliance, shall have the final authority to render or secure
an interpretation.
XLIV. NOTICES
44.1 All notices, demands, requests or other communications to be sent by one party to the
other hereunder or required by law shall be in writing and shall be deemed to have been validly
given or served by delivery of the same in person to the intended addressee, or by depositing the
27
HOME loan agreement
same with Federal Express or another reputable private courier service for next business day
delivery to the intended addressee at its address set forth below or at such other address as may
be designated by such party as herein provided, or by depositing the same in the United States
mail, postage prepaid, registered or certified mail, return receipt requested, addressed to the
intended addressee at its address set forth below or at such other address as may be designated by
such parry as herein provided. All notices, demands and requests shall be effective upon such
personal delivery, or one (1) business day after being deposited with the private courier service,
three (3) business days after being deposited in .the United States mail as' required above.
Rejection or other refusal to accept or the inability to deliver because of changed address of which
no notice was given as herein required shall be deemed to be receipt of the notice, demand or
request sent. Service of any notice required by Texas Property Code Section 51.002, as the same
may be amended, shal l be effective when the requirements to that statute are met. The following
are the addresses of LENDER and BORROWER for all purposes in connection herewith:
LENDER .
Corpus Christi Community Improvement Corporation
1201 Leopard St.
Corpus Christi, TX 78401
Attn: General Manager
i .a..0
Costa Tarragona 1, Ltd.
c/o Corpus Christi Housing Finance Corporation
1201 Leopard St.
Corpus Christi, TX 78401
Attn: General Manager
With a copy to:
Broad and Cassel
7777 Glades Road, Suite 300
Boca Raton, Florida 33434
Attention: Michael Rudewicz, Esq,
And a copy to:
Related Direct SLP, LLC
c/o Related Capital CoTTany LLC
625 Madison Avenue, 5 Floor
New York, NY 10022
Attn: Marc D. Schnitzer
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HOME loan agreement
By giving to the other party hereto at - least ten (10) days' prior, written notice thereof in
accordance with the provisions hereof, the parties hereto shall have the right from time to time to
change their respective addresses and each shall have the right to specify as its address any other
address.
XLV. PARTIES BOUND
45.1 This HOME LOAN AGREEMENT shall be binding on and inure to the benefit of the
parties hereto and their respective heirs, executors, administrators, legal representatives,
successors and assigns, except as otherwise expressly provided herein.
XLVL GENDER
46.1 Words of gender used in this HOME LOAN AGREEMENT shall be held and construed
to include the other gender, and words in the singular number shall be held to include the plural,
unless the context otherwise requires.
XLVII. RELATIONSHIP OF PARTIES
47.1 Nothing contained herein shall be deemed or construed by the parties hereto, or by any
third party, as creating the relationship of principal and agent, partners, joint venturers or any
other similar such relationship between the parties hereto.
47.2 It is expressly understood and agreed that BORROWER is and shall be deemed to be an
independent contractor and operator responsible to all parties for its respective acts or omissions
and that CCCIC shall in no way be responsible therefor.
XLVM. TEXAS LAW TO APPLY
48.1 THIS HOME LOAN AGREEMENT SHALL BE CONSTRUED UNDER AND IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, AND ALL OBLIGATIONS
OF THE PARTIES CREATED HEREUNDER ARE PERFORMABLE IN NUECES COUNTY,
TEXAS.
XLIX. CAPTIONS
49.1 The captions contained in this HOME LOAN AGREEMENT are for convenience of
reference only, and in no way limit or enlarge the terms and/or conditions of this HOME LOAN
AGREEMENT.
XLX. SUBORDINATION
50.1 This Agreement is subject to the conditions and provisions of that Subordination
Agreement dated as of November 1, 2005 among the Trustee, the Issuer, the CCCIC and the
Borrower.
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HOME loan agreement
EXECUTED this the 14 day of November 2005.
LENDER
ATTEST:
Armando Chapa
Secretary
BORROWER:
CORPUS CHRISTI COMMUNITY
IMPROVEMENT CORPORATION
Geo ge Noe
General Manager
COSTA TARRAGONA I, LTD., a Texas limited partnership
By: CCHFC Costa Tarragona I, LLC,. a Texas limited liability company, its general
partner
By: Corpus Christi Housing Finance Corporation,
a Texas corporation, its sole member
By:
JI"
de& Noe, General Manager
(ACKNOWLEDGMENT)
STATE OF TEXAS §
COUNTY OF NUECES §
a
%(I"
OhnK
IR X19.
This instrument was acknowledged before me on this — �lay of 044ti 005,
b G eorge Noe the General Manager of the Corpus Christi Housing Finance C y G g � g rP g � a
Texas housing finance corporation, the sole member of CCHFC Costa Tarragona L, LLC, a
Texas limited liability company, acting as the general manager of Costa Tarragona I, Ltd., a
Texas limited partnership, on behalf of the partnership.
JOHN 0 BELL
Notary Public
STATE OF TEXAS
MY Comm. UP. 04 -20 -2005
Attachments
NO A y PUBLIC, STATE OF TEXAS
Exhibit "A" -- Property Description
30
HOME loan agreement
r
C E -y} .< �
�title of san antonio
EXHIBIT "A"
Field Notes for. a 12.691 acre tract . of land out of Share G, and being a portion of a 13
acre tract of land out of Share. B and G, of the McBride Partition, said 134.6 acre being I
some property described by Deed . recorded under •Volume 94, Page 540, Deed Records of
Nueces County. Texas, said 12.691 acre tract being more fully described by metes and bou
as follows:
Beginning at a 5/8 inch iron rod with a red plastic cap stamped "Urban Engr C.C. D
set on the west boundary of McBride Lane, a 50.00 foot wide public roadway, for thl nor f
east corner of Lot 169, Ebony Acres No. 2,. a map of which is recorded in Volume 10, Pal
17, Map Records of Nueces County, Texas;
Thence, South 813'25'13' West (Plot -South 89'07'30" West), along the north boundary 1
said Ebony Acres, a distance of 1,132.44 feet to a 1 inch iron pipe found for the South
corner of this " tract;
Thence, North 1 T4-8'09" East, a distance of 166.59 feet to a 1' inch iron pipe found
an interior corner of this tract;
Thence, South 59'28'08" West, a distance of 413.41 feet to a 5/8 inch iron rod with s
red plastic cap stamped "Urban Engr C.C. TX' set on the east boundary of North Padre Isl-
Drive, a public roadway also known as State Highway 358, for the . southwest corner of this
tract,
Thence, along the flared right --of —way at the intersection of said North Padre island Dr
and Interitate Highway 37, as follows;
North 10'24'37'
East, 179.70 feet to a concrete monument found for a comer of this
tract;
North 15'26'41"
East, 94.08 fact to a concrete monument Found for a corner of this
tract;
North 22'59'10"
East, 172.48 feet to a concrete monument found for a corner of this
tract;
South 31'38'26" West 27.21 feat to a 5/8 inch iron rod
North 32'48' 140
East, 172.30 feet to a concrete monument found - for a comer of this
tract;
South 58'21'34" East x'0:00 fedt to a 5/8 Inch iron rod
North 42'31_'27"
East, 172.69 feet to a concrete monument found for a corner of this
tract;
South 20'28'58" East 12.67 feet to a 5/8 inch Iron rod
North 89'5439"
East. 21,15 feat to a 5/8 Inch iron rod with a red plastic cop stamped
"Urban Engr C.C. TX ", set for a comer of -this tract;
North OW17'3W
West 15.71 feet to •'a concrete monument found for a corner of this
tract;
North 5249'56"
East, 108:06 feet to a 5/8 inch iron rod with a red plastic cap stamped
"Urban Engr G.C. TX,
sit for the north corner of this tract;
Thence, along the northeast boundary of this tract as follows.
South 44'12'38" East 297.25 fast to a 5/8 inch iron rod
with a red plastic cap . stamped
"Urban Engr .C.C, T-X' set far a corner of this tract;
South 48'38'18" Watt •85:54 €e>rt to a 5/8 Inch iron rod
with a red plastic cap stamped
"Urban Engr C.C. TX" set for a comer of this tract;
South 5543'57" East 170.07 feet to a 5/6 inch iron rod with a- red plastic cop stamped
"Urban Engr G.C. TX" sot for a comer of this tract;
South 31'38'26" West 27.21 feat to a 5/8 inch iron rod
with a red plastic cap stamped
"Urban Engr C.C. TX" pet for a corner of this tract;
South 58'21'34" East x'0:00 fedt to a 5/8 Inch iron rod
with a red plastic cap stamped
'Urban Engr C.C. TX" set for a corner of this tract;
South 20'28'58" East 12.67 feet to a 5/8 inch Iron rod
with a red plastic cap stamped
"Urban Engr C.C. TX set ror a corner of - tfils tract;
South 31'38'26" West 47.83 feet to a 5/8 inch iron rod
"Urban
with a red plastic cap stamped
Engr C.C. TX" set for a corner of. this tract;
South 34'53'28" East 151.74 feat to a 5/8 inch iron rod
'Urban
with a red plastic cap stamped
Engr C.C. TX" set for a corner of this tract;
South 20'28'58" East 308.04 feet to a 5/8 inch iron rod
'Urban
with a red plastic cop . stamped
Engr C.C. W not for an interior corner of this _tract;
'thence, North 88`25'13' East, a distance of 540.00 feet to a 5/8 inch iron rod with a
red plastic cap stomped "Urban Engr C.C. TX" sat on the west boundary of sold McBride Lane,
for a corner of this . tract;
Thence, South .0 4•'08'S8` West a , distance of 40.20 feet to the Point of . Beginning - and
containing 12.691 acres (552,802 Square " l:eet) of land.
Bearings are based on the recorded plat of Ebony Acres No. 2, a map of which is
recorded in Volume 10, Page 17, Map Records of Nueces County, Texas.