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Home My WebLink AboutC2015-313 - 10/21/2015 - NA ORIGINAL HUD AMENDMENT TO RESTRICTIVE COVENANTS This AMENDMENT TO RESTRICTIVE COVENANTS is made as of Nolo tgl 2015, by C.C.T. Navigation-Cameron, LP, Texas limited partnership ("Borrower") and Corpus Christi Community Improvement Corporation("Agency"). WHEREAS,Borrower has obtained financing from Dougherty Mortgage LLC,a Delaware limited liability company ("Lender") for the benefit of the project known as Navigation Pointe Apartments ("Project"), which loan is secured by a Multifamily Deed of Trust A si ent 9f Leases and Rents and Security Agreement ("Security Instrument") dated as of a , 2015, and recorded in the Real Property Records of Nueces County, Texas ("Records") simultaneously herewith, and is insured by the United States Department of Housing and Urban Development("HUD"); WHEREAS, Borrower has received HOME funds from the Agency, which Agency is requiring certain restrictions be recorded against the Project; and Whereas Borrower entered into that certain Declaration of Restrictive Covenant of Affordability("Restrictive Covenants")with respect to the Project,as more particularly described in Exhibit A attached hereto, dated as of October 1, 2006 and recorded in the Records; WHEREAS,HUD requires as a condition of its insuring Lender's financing to the Project, that the lien and covenants of the Restrictive Covenants be subordinated to the lien,covenants,and enforcement of the Security Instrument; and WHEREAS,the Agency has agreed to subordinate the Restrictive Covenants to the lien of the Mortgage Loan in accordance with the terms of this Amendment. NOW, THEREFORE, in consideration of the foregoing and for other consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows: (a) In the event of any conflict between any provision contained elsewhere in the Restrictive Covenants and any provision contained in this Amendment,the provision contained in this Amendment shall govern and be controlling in all respects as set forth more fully herein. (b) The following terms shall have the following definitions: "Code"means the Internal Revenue Code of 1986, as amended. "HUD"means the United States Department of Housing and Urban Development. "HUD Regulatory Agreement" means the Regulatory Agreement between Borrower and HUD with respect to the Project, as the same may be supplemented, amended or modified from time to time. "Lender" means Dougherty Mortgage LLC, a Delaware limited liability company, its successors and assigns. 2015-313 10/21/15 C.C.T.Navigation-Cameron LP INDEXED "Mortgage Loan" means the mortgage loan made by Lender to the Borrower pursuant to the Mortgage Loan Documents with respect to the Project. "Mortgage Loan Documents"means the Security Instrument,the HUD Regulatory Agreement and all other documents required by HUD or Lender in connection with the Mortgage Loan. "National Housing Act"means the National Housing Act of 1934, as amended. "Program Obligations" has the meaning set forth in the Security Instrument. "Residual Receipts"has the meaning specified in the HUD Regulatory Agreement. "Security Instrument"means the mortgage or deed of trust from Borrower in favor of Lender, as the same may be supplemented, amended or modified. "Surplus Cash"has the meaning specified in the HUD Regulatory Agreement. (c) Notwithstanding anything in the Restrictive Covenants to the contrary, except the requirements in 26 U.S.C. 42(h)(6)(E)(ii), to the extent applicable, the provisions hereof are expressly subordinate to (i) the Mortgage Loan Documents, including without limitation, the Security Instrument, and (ii) Program Obligations (the Mortgage Loan Documents and Program Obligations are collectively referred to herein as the"HUD Requirements"). Borrower covenants that it will not take or permit any action that would result in a violation of the Code, HUD Requirements or Restrictive Covenants. In the event of any conflict between the provisions of the Restrictive Covenants and the provisions of the HUD Requirements, HUD shall be and remains entitled to enforce the HUD Requirements. Notwithstanding the foregoing, nothing herein limits the Agency's ability to enforce the terms of the Restrictive Covenants, provided such terms do not conflict with statutory provisions of the National Housing Act or the regulations related thereto. The Borrower represents and warrants that to the best of Borrower's knowledge the Restrictive Covenants impose no terms or requirements that conflict with the National Housing Act and related regulations. (d) In accordance with 26 U.S.C. 42(h)(6)(E)(i)(1),in the event of foreclosure(or deed in lieu of foreclosure), the Restrictive Covenants (including without limitation, any and all land use covenants and/or restrictions contained herein) shall automatically terminate, with the exception of the requirements of 26 U.S.C. 42(h)(6)(E)(ii) above, to the extent applicable, or as otherwise approved by HUD. (e) Borrower and the Agency acknowledge that Borrower's failure to comply with the covenants provided in the Restrictive Covenants does not and shall not serve as a basis for default under the HUD Requirements, unless a default also arises under the HUD Requirements. (f) Except for the Agency's reporting requirement, in enforcing the Restrictive Covenants the Agency will not file any claim against the Project, the Mortgage Loan proceeds, any reserve or deposit required by HUD in connection with the Security Instrument or HUD Regulatory Agreement, or the rents or other income from the property other than a claim against: i. Available surplus cash, if the Borrower is a for-profit entity; AUS:0053362/00002:605419v2 ii. Available distributions of surplus cash and residual receipts authorized for release by HUD, if the Borrower is a limited distribution entity; or iii. Available residual receipts authorized by HUD, if the Borrower is a non-profit entity. (g) For so long as the Mortgage Loan is outstanding, Borrower and Agency shall not further amend the Restrictive Covenants, with the exception of clerical errors or administrative correction of non-substantive matters, without HUD's prior written consent. (h) Subject to the HUD Regulatory Agreement,the Agency may require the Borrower to indemnify and hold the Agency harmless from all loss, cost, damage and expense arising from any claim or proceeding instituted against Agency relating to the subordination and covenants set forth in the Restrictive Covenants, provided, however, that Borrower's obligation to indemnify and hold the Agency harmless shall be limited to available surplus cash and/or residual receipts of the Borrower. (i) Notwithstanding anything to the contrary contained herein, it is not the intent of any of the parties hereto to cause a recapture of the Low Income Housing Tax Credits or any portion thereof related to any potential conflicts between the HUD Requirements and the Restrictive Covenants. Borrower represents and warrants that to the best of Borrower's knowledge the HUD Requirements impose no requirements which may be inconsistent with full compliance with the Restrictive Covenants. The acknowledged purpose of the HUD Requirements is to articulate requirements imposed by HUD, consistent with its governing statutes, and the acknowledged purpose of the Restrictive Covenants is to articulate requirements imposed by Section 42 of the Code. In the event an apparent conflict between the HUD Requirements and the Restrictive Covenant arises, the parties and HUD will work in good faith to determine which federally imposed requirement is controlling. It is the primary responsibility of the Borrower,with advice of counsel,to determine that it will be able to comply with the HUD Requirements and its obligations under the Restrictive Covenants. AUS:0053362/00002:605419v2 BORROWER: C.C.T.NAVIGATION-CAMERON, LP, a Texas limited partnership By: Merced-Navigation,LLC, a Texas limited liability company, its general partner By: Merced Housing Texas, a Texas non-profit corporation, its sole member By: kiAAA4r1A ‘Z• Name: Susan R. Sheeran Title: President STATE OF Tt)(A S § § COUNTY OF socA K. § „,i This instrument was acknowledged before me on this off` day ofn.h t , 2015, by Susan R. Sheeran, President of Merced Housing Texas, a Texas non-pro t corporation, sole member of Merced-Navigation, LLC, a Texas limited liability company, general partner of C.C.T. Navigation-Cameron, LP, a Texas limited partnership, on behalf of said limited partnership. k4r . KRI$TN L DAVI A t� w, .:a• ExpnES arr��r,r ff 'U:a bi1 CCAfir . Not*Public, tate of Texas AUS:0053362/00002:605419v2 AGENCY: CORPUS CHRISTI COMMUNITY IMPROVEMENT CORPORATION, a Texas non-pro orpo .= • By: •> % � pl1'1b5 Approved as to form: Name: Ilk,• • Title: _. ► ►...� ,.�ir.I_ �,.. A . stan C' �#401 ey STATE OF TEXAS § For City Attorney , r § COUNTY OF 'v wc-C&2 S § i This ipstrument was acknowledged before me on this Z day of e,claw , 2015,by �D 1. 0l50V\ duly autho 'zed representative of the Corpus Christi Community Improvement Corporation,a Texas non-9 • it corporation,on behalf of said corporation. SEAL 4_ tary ' blic, State of Texas _,�;`"�;��.�4 OIIVER KENT MEEK $_• s Notary Public.State of Texas = My Commission Expires 1,�rFp�iE',0 March 09, 2019 AUS:0053362/00002:605419V2 Exhibit A Legal Description Lot 1, Block 1, Navigation Pointe, a Subdivision of the City of Corpus Christi, Nueces County, Texas,as shown on the map or plat thereof recorded in Volume 66,Page 36,Map Records,Nueces County, Texas. . AUS:0053362/00002:605419v2