Loading...
Gilroy Pacific Associates - Regulatory Agreement and Declaration of Restrictive Covenants4 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Gilroy 7351 Rosanna Street Gilroy, CA 95020 -6141 Attn: City Clerk NO FEE PER GOVERNMENT CODE SECTIONS 6103 AND 27383 DOCUMENT: 23043190 Pages: 18 Copies.. 10.00 AMT PAID 10.00 REGINA ALCOMENDRAS SANTA CLARA COUNTY RECORDER Recorded at the request of City RDE # 001 8/05/2015 8 :49 AM REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS This Regulatory Agreement and Dec hon of Restrictive Covenants ( "Agreement ") is made and entered into this �hday of .5�, 2015, by and between the City of Gilroy, a municipal corporation ( "City"), and Gilroy Pacific Associates, a California Limited Partnership ( "Owner"). RECITALS A. Owner is the owner of certain real property located in the City of Gilroy, Santa Clara County, California, more particularly described in Exhibit "A" attached hereto and incorporated herein by this reference (the "Property"). B. The City has enacted Section 30.50.60 of the City Municipal Code which encourages responsible growth in the community, and restricts the amount of housing which may be constructed each year (the "Residential Development Ordinance" or "RDO "). C. The City has determined that it would be desirable to stimulate the development by private developers of permanent housing for very low and low income, in the City which satisfy certain conditions. In furtherance of this goal, the City has enacted the following: (1) Section 30.50.60 (b) 2.j. of the City of Gilroy Zoning Ordinance which exempts from the RDO a residential development sponsored by a non -profit organization funded by federal, state, or local governments as long as they meet certain criteria included in the ordinance where the exemption is approved by the City Council (the "RDO Exemption"), and (2) the RDO Affordable Housing Exemption Procedure (AHEP) which sets forth the specific criteria for implementing the RDO Exemption for affordable housing developments. D. Section 1.02 (A) (1) of the AHEP requires, among other provisions, that an applicant for an affordable housing project apply for and obtain approval of an Affordable Housing Exemption for the proposed development and enter into an agreement with the City with respect to the long -term operation of the development. 4816- 6940- 7523v2 TMORELL104706012 -1- E. The City has approved the owner's application for an Architectural and Site Approval (File No. A/S 13 -33) (the "A/S PUD ") and granted a Downtown Project Exemption to the Residential Development Ordinance (RDO) RDOHE 13 -03 to allow the construction of a two hundred sixty two (262) unit rental housing project, consisting of, eighteen (18) one bedroom apartments, one hundred ten (I 10) two bedroom apartments, one hundred two (102) three bedroom apartment units, thirty two (32) four bedroom apartments to be rented and occupied solely by individuals that are very low and low income in accordance with the A/S, 13 -33, Zoning Amendment Z 13 -07, and Conditional Use Permit (CUP 13 -10) RDO HE 13 -03 ( "CUP ").the RDO Exemption. Ninety percent of the units for each phase of the project shall be affordable to households with incomes 60 percent or less of the County median income and at least 10 percent of the units of each phase shall be affordable to households with incomes 50 percent or less of the County median income. F. The conditions of the Architectural and Site Approval require that, prior to issuance of a Building Permit, the project shall demonstrate conformance to the requirements of the A/S PUD final conditions, which requires the owner to enter into an agreement with the City that will ensure the continued affordability of all units within the project for a minimum period of 30 years, and specifies the number of units that are to be constructed in the development, the number of bedrooms in each unit, and the specific terms for renting units in the development. G. The parties are entering into this Agreement to satisfy the requirements of the A/S PUD and to ensure that the Project will be used and operated in accordance with the CUP, RDO HE Exemption, the AHEP and the A/S PUD. NOW, THEREFORE, for valuable consideration, the receipt of which is hereby acknowledged, City and Owner agree as follows: 1. Definitions. The following terms shall have the respective meanings assigned to them in this Section 1: (a) "Certificate of Occupancy Date" means the date of issuance by the City of a fully executed and complete Building Clearance Form for the Project. (b) "Closing Date" means the date this Agreement is recorded in the Official Records of the Recorder's Office of Santa Clara County, California (the "Official Records "). (c) "Gross Income" means the total of current adjusted gross income, as calculated for federal income tax purposes and relevant HUD guidelines, of all adult persons who intend to reside permanently in a household intending to occupy a Unit. (d) "HUD" means the United State Department of Housing and Urban Development -2- 4816- 6940- 7523v2 TMORELL104706012 (e) "Low Income Household" shall mean persons whose incomes do not exceed the qualifying limits for low income individuals established for Santa Clara County, California, as amended from time to time, pursuant to Section 8 of the United States Housing Act of 1937. In the event such federal standards are discontinued, income limits for Low Income Households shall be those set by the California Department of Housing and Community Development for Santa Clara, California as below eighty percent (80 %) of Median Income, adjusted for family size. (f) "Very Low Income Household" shall mean persons whose incomes do not exceed the qualifying limits for very low income individuals established for Santa Clara County, California, as amended from time to time, pursuant to Section 8 of the United States Housing Act of 1937. In the event such federal standards are discontinued, income limits for Very Low Income Households shall be those set by the California Department of Housing and Community Development for Santa Clara, California as below fifty percent (50 %) of Median Income, adjusted for family size. (g) "Project" means the two hundred sixty two (262) unit rental affordable housing project (including 2 units for a resident manager(s)), consisting of eighteen (18) one bedroom apartment units, one hundred ten (110) two bedroom apartments, one hundred two (102) three bedroom apartments, thirty two (32) four bedroom apartments to be developed on the Property, together with all landscaping, parking spaces and appurtenances thereto, and the Property upon which it is constructed, as the same may from time to time be modified or replaced, as further described in the A/S PUD. (h) "Project Approvals" means all governmental approvals obtained by Owner for the development and construction of the Project, including without limitation the CUP. (i) "Rent" means the total of monthly payments by a tenant for a Unit for the following: use and occupancy of a Unit and associated facilities; any separately charged fees or service charges assessed by Owner which are required of all tenants, other than security deposits, laundry facility fees, late payment fees, insufficient funds fees and special event or room rental fees; the cost of an adequate level of service for utilities paid by the tenant, if any, including garbage collection, sewer, water, electricity, gas and other heating, cooling and refrigeration fuel, but not telephone service, cable television and any other tenant ordered service; any other interest, taxes, fees or other charges for use of the Unit, land or associated facilities and assessed by a public or private entity other than Owner, and paid by the tenant. The City may determine the cost of utilities by using the utility allowance promulgated by the United States Department of Housing and Urban Development under the Section 8 Program (i.e., the program administered under Section 8 of the United States Housing Act of 1937, as revised or replaced from time to time) for Santa Clara County, California or the County of Santa Clara established maximum monthly allowances for utilities and services. 0) "Term" means the period of time beginning on the Closing Date and ending on the later of (i) fifty -five (55) years following the Certificate of Occupancy Date, or (ii) -3- 4816- 6940- 7523v2 TMOREW04706012 the date of expiration of the longest running occupancy and rent affordability restriction placed on the Property with respect to any source of debt or equity financing for the Project. (k) "Units" means the dwelling units to be constructed on the Property as part of the Project. 2. The Owner hereby acknowledges and agrees that the Project is to be developed, owned, managed and operated to provide two hundred sixty two (262) units of apartment housing, consisting of two (2) employee units and two hundred sixty (260) apartment units, which shall be rented and occupied during the Term of this Agreement solely by Very Low and Low Income individuals. To that end, and for the Term of this Agreement, the Owner hereby represents, covenants, warrants and agrees as follows:. (a) Development and Use as Rental Housing. Owner shall complete construction of the Project in accordance with all Project Approvals and all loans and encumbrances encumbering the Property. Owner shall own, manage and operate the Project to provide two hundred sixty (260) units of rental housing, which shall be rented and occupied solely by Very Low and Low Income individuals during the Term of this Agreement. If at any time during the Term of this Agreement, there are less than the required number of rental Units rented to and occupied by Very Low and Low Income individuals, Owner shall market available Units within the Project only for rent to individuals which meet the target household income category necessary to bring the Project into compliance with the requirements of this Agreement, until such time as the Units of the Project are rented to and occupied by the requisite number of Very Low Income individuals. (b) Compliance With Laws. Each Unit, and all common areas, shall be maintained in conformity with applicable building codes and regulations and all other applicable laws. (c) Prohibition of Use for Transient Housing. None of the Units on the Property shall at any time be utilized on a transient basis, or as a hotel, motel, dormitory, fraternity house, sorority house, rooming house, nursing home, hospital, sanitarium, rest home, retirement home, or trailer court or park. (d) Nondiscrimination. The Owner shall not give preference to any particular class or group of person in renting the Units, except to the extent that all of the Units are required to be leased to Low and/or Very Low Income persons provided such limitation is allowed by applicable laws. The Owner agrees that there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, sexual preference, marital status, national origin, or ancestry, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the Project nor shall the Owner, or any person claiming under or through the Owner, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy of tenants, lessees, sublessees, subtenants or vendees of the Project or in connection with the employment of persons for the operation and management of the Project. All deeds, leases or contracts made or entered into by -4- 4816- 6940- 7523v2 TMORELL104706012 Owner as to the Units or the Project or any portion thereof during the Term shall contain a prohibition against discrimination or segregation as set forth in this subsection (d) above. Notwithstanding the foregoing, without limiting any of Owner's obligations under generally applicable law, nothing in this subsection (d) is intended to require Owner to change the character, design, use or operation of the Project from, or to require Owner to obtain licenses or permits other than those required for, a rental housing development for persons capable of independent living. (e) Taxes and Assessments. Owner shall pay all real and personal property taxes, assessments and charges and all franchise, income, employment, withholding, sales, and other taxes assessed against Owner or the Project, or otherwise payable by Owner, at such times and in such manner as to prevent any penalty from accruing, or any lien or charge from attaching to the Project; provided, however, that Owner shall have the right to contest in good faith, any such taxes, assessments or charges. If Owner exercises its right to contest any tax, assessment or charge against it or the Project, Owner, on final determination of the proceeding or contest, shall immediately pay or discharge any decision or judgment rendered against it or the Project, together with all costs, charges and interest. (f) Maintenance. Owner shall at all times maintain the Project in good repair and working order, reasonable wear and tear excepted, and in a safe and sanitary condition, and from time to time shall make all necessary and proper repairs, renewals and replacements in order to keep the development in a good, safe and sanitary condition. 3. Occupancy and Rent Restrictions. Owner hereby represents, warrants, and covenants as follows: (a) Occupancy by Very Low and Low Income Individuals. Owner agrees to exert diligent efforts to see that the Project provides residential rental housing, which shall be rented and occupied solely by Very Low and Low Income individuals during the Term of this Agreement. Attached hereto as Exhibit `B" is a listing of the number of Units within the Project and the number of bedrooms in each Unit. If, at any time during the Term of this Agreement, less than the required number of Units are rented to and occupied by Very Low and Low Income individuals, Owner agrees to market the available Units in the Project only for rent to households which meet the target household income category necessary to bring the Project into compliance with the requirements of the Agreement, until the required number of Units in the Project are rented to and occupied by the requisite number of Very Low and Low Income individuals. The marketing requirements set forth in this subsection (a) above shall apply regardless of the reason for less than the required number of Units being rented to and occupied by Very Low and Low Income individuals at any given time during the Term of this Agreement, including without limitation where such situation exists as the result of income increases of any tenant who may at one time have qualified for the targeted household income category. (b) Allowable Rent. The rent payable for each Unit shall not exceed 30% of the area median income for Santa Clara County, adjusted for imputed household size, as determined by HUD. The AHEP requires that rental rates shall be equivalent to the California -5- 4816- 6940- 7523v2 TMORELL104706012 Tax Credit Allocation Committee (CTCAC) 60% and 50% income level rental rates for Santa Clara County. Rent for any Unit may only be increased one (1) time per year, and the Rent levels following an increase, or upon a new occupancy, shall not exceed the applicable Rent levels required pursuant to this Subsection (b). A tenant shall not be required to pay a cleaning and/or security deposit totaling in the aggregate more than the monthly Rent for a Unit. (c) Effect of Increase in Income. City reserves the right to review all documents and materials related to tenant eligibility, and to verify the continuing eligibility of all tenants and prospective tenants. All prospective tenants shall have their eligibility verified by the Owner prior to rental of the Unit. Owner shall re- certify tenant incomes annually thereafter. If a tenant household's income increases during its tenancy, the following shall apply (subject to the requirements of other lenders and applicable state and federal regulations): (i) If the tenant household's income does not exceed one hundred twenty percent (120 %) of the maximum income which qualifies as a Very Low or Low Income Household as applicable to such Unit and the tenant's occupancy, the tenant shall be allowed to remain in its Unit. (ii) If a tenant household is found to make more than one hundred twenty percent (120 %) of the maximum income which qualifies as a Very Low or Low Income Household as applicable to such Unit and the tenant's occupancy, the tenant shall be given written notice to vacate. Such notice shall require the tenant to vacate the Unit not later than one hundred twenty days (120) after the date that Owner becomes aware of the income increase, subject to any legally required noticing procedures. (d) Advertising and Outreach. Owner shall advertise the existence and terms of this rental program to the general public, coordinate specific outreach efforts to Very Low and Low Income individuals through cooperation with social service agencies, City agencies, and other entities serving such Very Low and Low Income individuals, and accept applications from prospective tenants. Owner shall keep a list of all qualified tenants, and shall make this list, along with all relevant financial data pertaining to prospective tenants, available to City upon request. All tenants shall be selected off of this list. Owner shall provide the City with a detailed outreach and advertising plan acceptable to City not less frequently than annually during the Term of this Agreement, in order to insure that the housing needs for Very Low and Low Income individuals are met. (e) Compliance with A/S. Rental of the Units within the Project shall be subject to and shall comply with the criteria for occupancy standards set forth in the A/S as the same may be amended from time to time. No deviation from such criteria for occupancy standards shall be allowed except as expressly agreed to by the City on application of Owner, determined in City's sole discretion. 4. Income Certification and Reporting. (a) Tenant Certifications. -6- 4816- 6940- 7523v2 TMORELL104706012 (i) During any period that income and household size and composition certifications from each tenant and household are required to be submitted to any federal, state and/or county agencies under the terms of any loan from such agencies recorded against the Project, Owner shall submit copies of those certifications to City at the same time that submittal of such certifications are required to be made to the applicable federal, state and/or county agencies. (ii) During any period when income and household size and composition certifications from each tenant and household are not required to be submitted to any federal, state, and/or county agencies under the terms of any loans from such agencies recorded against the Project, the requirements of this subsection (ii) shall apply. Immediately prior to initial occupancy by such tenant household and annually thereafter, Owner shall obtain income and household size and composition certifications by each tenant household obtained in such form required by City from time to time. Owner shall obtain updated forms for each tenant household on request by the City, but in no event less frequently than once a year. Owner shall verify that the income information provided by an applicant or occupying household in an income certification is accurate by taking one or more of the following steps as part of the verification process; (1) obtain pay stubs for the three (3) most recent pay periods; (2) obtain an income tax return for the most recent tax year; (3) obtain an income verification form from the applicant's current employer; (4) obtain an income verification form from the Social Security Administration and/or the California Department of Social Services if the applicant receives assistance from either of such agencies; or (5) if the applicant is unemployed and has no such tax return, obtain another form of independent verification. Copies of tenant income certifications and documents verifying income shall be maintained during the entire occupancy of a Unit by a household and for a period of not less than five (5) years thereafter and shall be available to the City within five (5) days after request. (b) Annual Report to City. Each year the Owner shall submit an annual report to the City on a form to be provided by the City, except that to the extent that an annual report containing the information required by this subsection (b) below is required to be submitted to any federal, state and/or county agencies under the terms of any loans from such agencies recorded against the Project, the annual report to be submitted to the City shall be on the same forms as is required to be submitted to such federal, state and/or county agencies. The annual report shall include for each Unit, the Rent and the income and family size and composition of the household occupying the Unit. The report shall also state the date the tenancy commenced for each Unit. The income and household size and composition information shall be as supplied by each tenant household in the certification form required by Section 4(a) above. A true copy of each such form, signed by the tenant, shall be attached to the Owner's annual report to the City. For each calendar year during the Term, an annual report shall be filed with the City not later than September 30 of the following calendar year. -7- 4816- 6940- 7523v2 TMORELL104706012 (c) Additional Information. The Owner shall provide to the City any additional information required by the laws of the City, the State of California and the United States, as the same may be amended from time to time. (d) Lease. To the extent not in conflict with the requirements of any loan to which this Agreement has been expressly subordinated by written agreement of the City, the provisions of this subsection (d) shall apply. Owner shall include in leases and rental agreements for all Units, provisions which authorize Owner to immediately terminate the occupancy of any individual who misrepresented any fact material to the household's qualification as a Very Low or Low Income Household. Each lease or rental agreement shall also provide that the household is subject to annual certification in accordance with Section 4(a) above. Owner shall specifically refer to this Agreement in any lease of a Unit and to any purchase and sale contract with respect to any portion of the Project, provided that failure to do so shall not invalidate or otherwise affect the effectiveness of this Agreement. Every grant deed for all or any portion of the Project shall specifically state that the grant is made subject to all of the terms and conditions set forth in this Agreement, provided that Owner's failure to comply with these requirements shall not invalidate or otherwise affect the effectiveness of this Agreement. (e) Cooperation City acknowledges and agrees that Owner may be obtaining financing for the Project with assistance from the California Tax Credit Allocation Committee, California Housing Finance Agency, California Municipal Finance Authority, California Statewide Communities Development Authority, the California Community Reinvestment Corporation, Santa Clara County, other state or federal housing agencies, Citibank, N.A., and Gilroy Affordable Housing Builders & Investors, Inc. which financing will be secured by deeds of trust, pledge agreements, financing agreements and/or regulatory agreements to be recorded prior or subsequent to the lien of this Agreement. In addition, the City agrees to subordinate this Agreement to the liens of the deeds of trust, pledge agreements, financing agreements and regulatory agreements required in connection with the Owner's receipt of financing for the development from Citibank, N.A., California Statewide Communities Development Authority, the California Community Reinvestment Corporation, and Gilroy Affordable Housing Builders & Investors, Inc. and agrees to execute any subordination or intercreditor agreements reasonably required to effect such subordination. 5. Indemnification. The Owner hereby covenants and agrees that it shall indemnify, defend with counsel acceptable to City and hold harmless the City and the City's officers, members, commissioners, directors, officials, employees, and agents (collectively, the "Indemnified Parties "), from and against any and all claims arising directly or indirectly from this Agreement and the construction, ownership, operation or management of the Project; and all reasonable costs and counsel fees incurred by the Indemnified Parties in defense of such a claim, or in order to assert its rights under this Section 5, except to the extent such claims arise from the gross negligence or willful misconduct of an Indemnified Party. 6. Term. This Agreement shall become effective upon its execution and delivery and shall remain in full force and effect for the Term. This Agreement shall bind any successor, heir or assign of Owner, whether a change in interest occurs voluntarily or involuntarily, by operation of -8- 4816- 6940- 7523v2 TMORELL104706012 law or otherwise, with or without the approval of the City, except as expressly released by the City. This Agreement shall inure to the benefit of the City and its successors. 7. Covenants to Run with the Land. The City and Owner hereby declare their express intent that the covenants and restrictions set forth in this Agreement are covenants running with the land, and that the covenants shall be binding upon all successors in title to the Project or any portion thereof for the Term hereof. Each and every contract, deed or other instrument hereafter executed covering or conveying the Project or any portion thereof shall be held conclusively to have been executed, delivered and accepted subject to such covenants and restrictions, regardless of whether such covenants and restrictions are set forth in such contract, deed or other instrument. The Owner and the City hereby declare their understanding and intent that: (a) The covenants and restrictions contained in this Agreement shall be covenants running with the land pursuant to California Civil Code section 1460 et seq.; and (b) The burden of the covenants and restrictions set forth in this Agreement touch and concern the Project in that the Owner's legal interest in the Property and all improvements thereon may be rendered less valuable thereby, and (c) The benefit of the covenants and restrictions set forth in this Agreement also touch and concern the Project by enhancing and increasing the enjoyment and use of the Project and Units by Very Low and Low Income Households, furthering the public purpose for which exemption from the RDO was granted to Owner. Notwithstanding the foregoing, all covenants and restrictions contained herein without regard to technical classification or designation shall be binding upon the Owner and its successors in interest for the benefit of the City, and such covenants and restrictions shall run in favor of City for the entire Term, without regard to whether the City is an owner of any land or interest therein to which such covenant and restrictions relate. 8. Uniformity, Common Plan. The covenants and restrictions set forth in this Agreement shall apply uniformly to all Units, in order to establish and carry out a common plan for the use of the Property. 9. Enforcement by the City. If the Owner defaults in the performance of any of the Owner's obligations under this Agreement, City shall have the right to pursue any or all of the following actions, or any other remedy provided by law or in equity: (a) Action to Compel Performance. The City may bring an action at law or in equity to compel the Owner's performance of its obligations under this Agreement and/or to prevent the violation of the terms and conditions of this Agreement by Owner. -9- 4816- 6940- 7523v2 TMORELL104706012 (b) Action for Damages. The City may bring an action to collect damages from the Owner due to Owner's default. (c) All Remedies Available and Cumulative. City shall have the right to exercise all available rights and remedies, and to maintain any action at law or suits in equity or other proceedings, including without limitation, specific performance, to enforce the terms, covenants and restrictions of this Agreement. No delay in enforcing the provisions hereof as to any breach or violation shall impair, damage or waive the right of the City to enforce the provisions hereof in the future for any continuing or new breach or violation of any of the terms, covenants or restrictions contained in this Agreement. All rights and remedies, including without limitation those set forth in this Section 9 above, of any party legally entitled to enforce this Agreement shall be cumulative and the exercise of any such right or remedy shall not impair or prejudice and shall not be a waiver of the right to exercise any other such rights and remedies. 10. Lienor's Remedies. The provisions of this Agreement do not limit the right of any obligee to exercise any of its remedies for the enforcement of any pledge or lien upon the Property; provided, however, that in the event of any foreclosure, under any mortgage, deed of trust or other lien or encumbrance, or a sale pursuant to any power of sale included in any such mortgage or deed of trust, or in the case of a deed in lieu of foreclosure, the purchaser (or other transferee) and their successors in interest and assigns and the Property shall be, and shall continue to be, subject to all of the covenants and restrictions set forth in this Agreement. The provisions of this Section 10 shall not apply with respect to any loan to which this Agreement has been expressly subordinated pursuant to a separate written instrument executed by City. 11. Right of Inspection. City shall have the right from time to time during the Term of this Agreement, and for a period of five (5) years thereafter, upon giving Owner reasonable notice, to examine and make copies of all books, records or other documents of the Owner which pertain to the Project. All such books, records and other documents pertaining to the Project shall be maintained at the office of the Owner or management agent. All such books, records and documents shall be maintained by Owner for a period of not less than five (5) years, or such longer period as required by this Agreement. 12. Attorneys' Fees and Costs. In any action brought to enforce or interpret this Agreement, the prevailing party shall be entitled to all costs and expenses of suit, including reasonable attorneys' fee. 13. Recording and Filing. City and Owner shall cause this Agreement and all amendment and supplements to it, to be recorded in the Official Records, at Owner's cost. 14. Governing Law. This Agreement shall be governed by the laws of the State of California. 15. Amendments. This Agreement shall be amended only by a written instrument executed by the parties hereto or their successors in title, and duly recorded in the Official -10- 4816- 6940- 7523v2 TMORELL104706012 Records. The City and its successors and assigns, on the one hand, and the Owner and its successors in interest and assigns, on the other, shall have the right to consent and agree to changes in, or to eliminate in whole or in part, any of the covenants or restrictions contained in this Agreement without the consent of any tenant, lessee, easement holder, licensee, mortgagee, trustee, beneficiary under a deed of trust or any other person or entity having any interest less than a fee in the Property. This Agreement shall not be amended, modified or terminated except upon the written consent of the City and upon the recordation of an amendment hereto duly executed and acknowledged by City and Owner. Whenever any approval, amendment, request or other action by the City is required or permitted under this Agreement, such action may be given, made or taken by the City Administrator , or his designee, in his/her discretion without further approval by the City Council and such action shall be in writing. The City Administrator is authorized, in his or her sole and absolute discretion to (i) approve non - material modifications to the terms of the instrument and agreements to be executed to implement this Agreement, and (ii) approve requests by the Owner for reasonable extensions of time deadlines set forth in this Agreement. Amendments to the Agreement authorized by the City Administrator shall not reduce the Term or affect the affordability requirements, number of Units or otherwise affect the restrictions and/or covenants for affordability. 16. Notice. All notices shall be given personally or by first class mail, postage prepaid, addressed as shown on the signature page of this Agreement. Notices shall be deemed given on the earlier of the date delivered or the second day following the date on which the same have been mailed in the manner required by the prior sentence. Any of the parties may, by notice given in the manner required by this Section 16, designate any further or different addresses to which subsequent notices shall be sent. 17. Severability. If any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining portions of this Agreement shall not in any way be affected or impaired thereby. 18. Assignment. This Agreement may be assigned with the written consent of the City to an entity created by the Owner for the sole purpose of developing, owning, managing and operating the Project in which the Owner shall remain as general partner or managing partner. Notwithstanding any other provision of this Agreement, no other duties or obligations of the Owner under this Agreement may be assigned by the Owner without the prior written consent of City, in the sole and absolute exercise of City's discretion. 19. Other Agreements. The parties acknowledge and agree that the operation of the Units in accordance with this Agreement satisfies the Owner's obligations under the A/S PUD, the AHEP and the RDO Exemption with respect to the income, rent and length of stay restrictions applicable to the Units. In the event of any inconsistency between this Agreement and the foregoing documents and approvals with respect to the income and rent restrictions applicable to the Project, this Agreement shall control. However, in the event of any conflict between this Agreement and any Federal or State tax credit or tax - exempt bond financing regulation, law or agreement (the "Tax Credit Regs "), the Tax Credit Regs shall control. -11- 4816- 6940- 7523v2 TMORELL104706012 20. Counterparts. The parties hereto agree that this Agreement may be executed in counterparts, each of which shall be deemed an original, and said counterparts shall together constitute one and the same Agreement, binding all of the parties hereto, notwithstanding that all of the parties are not signatories to the original or the same counterparts. For all purposes, including, without limitation, recordation, filing and delivery of this instrument, duplicate, unexecuted and unacknowledged pages of the counterparts may be discarded and the remaining pages assembled as one document. -12- 4816- 6940- 7523v2 TMORELL104706012 IN WITNESS WHEREOF, the City and the Owner have executed this Agreement by duly authorized representatives on the date and year shown below. IL OY, a municipal corporation By: omas J. Hagl d Its: City Administrator Approved to ITY AYTOANEY Dated: 1-1 , 20 ( i 4816 - 6940- 7523v2 TMORELL104706012 Address: 7351 Rosanna Street Gilroy, CA 95020 -6141 Gilroy Pacific Associates, a California Limited Partnership By: TPC Idaho Holdings V, LLC, an Idaho limited liability company, its General Partner By: Caleb Roope Its: Manager Address: 430 E State Street, Suite 100 Eagle, Idaho 83616 -13- STATE OF CALIFORNIA SS. COUNTY OF On before me, appeared ❑ personally known to me -OR- ❑ personally proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he /she /they executed the same in his/her /their authorized capacity(ies), and that by his/her /their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal. -14- 4816 - 6940- 7523v2 TMORELL104706012 CAPACITY CLAIMED BY SIGNER Though statute does not require the Notary to fill in the data below, doing so may prove invaluable to persons relying on the document. ❑ INDIVIDUAL ❑ CORPORATE OFFICERS(S) Title(s) ❑ PARTNER(S) ❑ LIMITED ❑ GENERAL ❑ ATTORNEY -IN -FACT ❑ TRUSTEE(S) ❑ GUARDIAN /CONSERVATOR ❑ OTHER: SIGNER IS REPRESENTING: Name of Person(s) or Entity(ies) CAPACITY CLAIMED BY SIGNER Though statute does not require the Notary to fill in the data below, doing so may prove invaluable to persons relying on the document. ❑ INDIVIDUAL ❑ CORPORATE OFFICERS(S) Title(s) ❑ PARTNER(S) Q UMITED LkooGENERAL ❑ ATTORNEY -IN -FACT ❑ TRUSTEE(S) ❑ GUARDIAN /CONSERVATOR ❑ OTHER: SIGNER IS REPRESENTING: Name of Person(s) or Entity(ies) SIGNATURE OF NOTARY STATE OF C`A 4- U A)AD ss. COUNTY OF � A� On %,UvK, before me, Q�Vikpl jQ:Zty- personally appeared CAr." SZeoQL- ❑ personally known to me -OR- proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to ••i, VAN OQ me that he /she /they executed the same in his/her /their authorized capacity(ies), �..00, • by his/her /their and that signature(s) on instrument IOTA* r the the person(s), or the entity upon behalf of which the U2 L1C person(s) acted, executed the instrument. %� � ••••. �OF IDA� WI ESS m nd and official seal. , Itoo II fell SIGNATURE OF NOTARY .4M -14- 4816 - 6940- 7523v2 TMORELL104706012 CAPACITY CLAIMED BY SIGNER Though statute does not require the Notary to fill in the data below, doing so may prove invaluable to persons relying on the document. ❑ INDIVIDUAL ❑ CORPORATE OFFICERS(S) Title(s) ❑ PARTNER(S) ❑ LIMITED ❑ GENERAL ❑ ATTORNEY -IN -FACT ❑ TRUSTEE(S) ❑ GUARDIAN /CONSERVATOR ❑ OTHER: SIGNER IS REPRESENTING: Name of Person(s) or Entity(ies) CAPACITY CLAIMED BY SIGNER Though statute does not require the Notary to fill in the data below, doing so may prove invaluable to persons relying on the document. ❑ INDIVIDUAL ❑ CORPORATE OFFICERS(S) Title(s) ❑ PARTNER(S) Q UMITED LkooGENERAL ❑ ATTORNEY -IN -FACT ❑ TRUSTEE(S) ❑ GUARDIAN /CONSERVATOR ❑ OTHER: SIGNER IS REPRESENTING: Name of Person(s) or Entity(ies) LEGAL DESCRIPTION EXHIBIT "A" THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF GILROY, COUNTY OF SANTA CLARA, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: Parcel One: Being a part of Sub Lot 21 as shown upon Map No. 8 and a part of Ranch Lot 44 as shown upon Map No. 7 said Maps, accompanying the report of the Referees in the Las Animas Rancho Partition Suit Action No. 5536 had in the Superior Court of the State of California in and for the County of Santa Clara, and more particularly described as follows: Beginning at an iron pipe in the Southerly line of Ninth Street in the City of Gilroy at the most Northwesterly corner of the 5.22 acre tract of land conveyed to Luigi Poletti by Deed recorded August 30, 1920 in Book 516 of Deeds, Page 508, said Point of Beginning being also S. 700 00' W. 56.75 feet from the intersection of the Southerly line of Ninth Street with the Easterly line of Alexander Street; thence from said Point of Beginning along the said Southerly line of Ninth Street S. 700 00'W. 40.02 feet to a 4" x 4" Redwood post marked CPC2 standing at the most Northeasterly corner of the 4.65 acre tract of land conveyed to the California Packing Corporation by Deed recorded in Volume 452, Official Records, Page 456; thence along the Easterly line of said 4.65 acre tract S. 210 52' E. 521.02 feet to a 4" x 4" Redwood post marked CPC3; thence parallel with the City Limit Line S. 700 00' W. 396.51 feet to an iron pipe (given as 397.47 feet in the above mentioned conveyance of the 4.65 acre tract) standing in the Easterly right of way line of the Southern Pacific Company, being also in the line between Sub Lots 21 and 22A, thence along said right of way line and common lot line, S. 200 00' E. 73.27 feet to the point of intersection of the Southerly City Limit Line; thence continuing along said right of way line and the line common to Ranch Lots 44 and 68, S. 200 00' E., 471.14 feet to the beginning of a curve to the right; thence along the arc of a curve having a radius of 17,138 feet (00 20' centerline curve) through an angle of 0° 30' 55" for an arc distance of 154.14 feet to an iron pipe at the intersection of said line with the Northerly line of Bane Lane, being the Southerly line of said Lot 44; thence along the Northerly line of Bane Lane, S. 890 45' E. 467.07 feet to an iron pipe at the Southwesterly corner of the tract conveyed to Hobbs by Deed recorded in 1894 in Book 178 of Deeds, Page 11; thence along the Westerly line of said land of Hobbs, N. 200 00'W. 786.85 feet to an iron pipe standing in the South City Limit Line at the Northwest corner of said Tract of Hobbs and the Southwest corner of said Tract of Poletti, thence along the Westerly line of said Tract of Poletti N. 210 52" W. 594.31 feet to the point of beginning. Excepting therefrom all that portion thereof described in the Deed from Manabi Hirasaki et ux to the City of Gilroy, A Municipal Corporation, dated September 17, 1957 and recorded December 8, 1964 in Book 6770 Official Records, Page 524. Recorder's Serial Number 2756376 more particularly described as follows: Commencing at an iron pipe in the Southeasterly line of Ninth Street in the City of Gilroy, distant thereon South 700 00' West 56.75 feet from the point of intersection of the Southeasterly line of Ninth Street with the Southeasterly prolongation of the Northeasterly line of Alexander Street; thence leaving Ninth Street South 210 52' East 594.31 feet to an iron pipe on the Southerly City Limited Line of said City of Gilroy; thence South 200 00' East 26.17 feet to the True Point of Beginning of this description, said True Point of Beginning also being the most Easterly corner of that certain 1.00 acre parcel of land conveyed by Manabi Hirasaki, et ux, to Mike J. Filice, et al, by Deed dated October 3, 1951 and recorded November 6, 1951 in Book 2311 of Official Records, Page 531, Santa Clara County Records; thence from said True Point of Beginning along the Southeasterly line of said 1.00 acre parcel of land, South 700 00' West 40.00 feet; thence South 210 31' 15" East 753.57 feet to the Northerly line of Banes Lane; thence along the -1- 4816- 6940- 7523v2 TMORELL104706012 Northerly line of Banes Lane 21.32 feet to the most Easterly corner of said 8.326 acre tract of land; thence leaving Banes Lane and running along the Northeasterly line of said 8.326 acre tract of land North 20° West 760.68 feet to the True Point of Beginning. Also excepting therefrom: All that portion thereof described in the Deed from The City of Gilroy, to the County of Santa Clara, recorded April 1, 1970 in Book 8876 Page 554 and more particularly described as follows: Beginning at a point of the intersection of the Westerly line of Alexander Street, 60 feet wide with the Southerly line of that certain 1 acre parcel of land described by the Deed from Mike 1. Filice, et al to the Gilroy Telephone Company recorded in Book 2311 of Official Records at Page 532 in the Office of the Recorder of the County of Santa Clara, State of California; thence from said Point of Beginning North 211 10' 16" West 14.17 feet along the Westerly line of Alexander Street to a point; thence on a curve to the left with a radius of 20 feet and a central angle of 900 to a point in a line parallel with and 34.17 feet measured at right angles Northerly from the Southerly line of said 1 acre parcel; thence South 700 41'44" West 378.92 feet along said parallel line to the Easterly right of way line of the Southern Pacific Railroad Company; thence South 190 10' 16" East 34.17 feet along said Easterly line to a point in the South line of said 1 acre parcel of land; thence North 700 41' 44" East 390.92 feet along said Southerly of the 1 acre parcel to the point of beginning. Also execepting therefrom all that portion thereof described in the Deed from Manabi Hirasaki et ux to Mike 3. Filice et al dated October 3, 1951 and recorded November 6, 1951 in Book 2311, Page 531, Official Records, being more particularly described as follows: Being a part of Sub Lot 21 as shown on Map No. 8 and a part of Ranch Lot No. 44 as shown on Map No. 7, said Maps being those accompanying the report of the Referees in the Las Animas Rancho Partition Suit, Action No. 5536 had in the Superior Court of the State of California, in and for the County of Santa Clara, and being more particularly described as follows: Beginning at an iron pipe at the Southwesterly corner of the lands of the California Packing Corporation as described in Deed recorded in Book 452 at Page 456 of Official Records of Santa Clara County, and running thence along the Easterly line of the Southern Pacific Railroad Right of Way S. 200 00' E. 99.44 feet; thence N. 700 00' E. 438.92 feet to a point in the Southwesterly line of Bram as described in Deed recorded in Book 178 of Deeds at Page 11, Records of Santa Clara County; thence along said Southwesterly line N. 200 00' W. 26.17 feet to an iron pipe at the Northwesterly corner of said lands of Bram; thence along the Southwesterly line of the lands of Bram as described in Deed recorded in Book 516 at Page 508, Record of Santa Clara County N. 210 52' W. 73.31 feet; thence S. 700 00' W. 436.53 feet to the point of beginning. Also excepting therefrom all that portion thereof described in the Deed to Gilroy Nisel Athletic Club, A Non - profit Corporation recorded April 19, 1956 Official Records in Book 3472, Page 17 and being more particularly described as follows: Being a portion of Ranch Lot 44 as shown on Map No. 7 accompanying the final report of the Referees in the Las Animas Rancho Partition Suit, Action No. 5536 had in the Superior Court of the State of California, in and for the County of Santa Clara, and being more particularly described as follows: Beginning at an iron pipe in the Southerly line of Ranch Lot 44 and the Northerly line of Bane Lane as shown on said Map, distant thereon N. 890 45'W. 252.23 feet from the Southwest corner of Ranch Lot 45 and from which the Southwest corner of that Tract conveyed to Hobbs by Deed recorded in 1894 in Book 178 of Deeds at Page 11, Santa Clara County Records, bears S. 890 45' E. 42.63 feet, and running thence along the -2- 4816 - 6940- 7523v2 TMORELL104706012 Southerly line of Ranch Lot 44 and the Northerly line of Bane Lane N. 891 45' W. 100.00 feet thence N. 200 00' W. 75.00 feet; thence N. 701 00' E. 93.82 feet; thence S. 201 00' E. 109.61 feet to the point of beginning. Also excepting therefrom all that portion thereof described in the Deed to City of Gilroy, A Municipal Corporation, recorded February 18, 1957 in Book 3733, Page 68 and being more particularly described as follows: Being a part of Sub Lot No. 21 as shown on Map No. 8 accompanying the report of the Referees in the Las Animas Ranch Partition Suit, Action No. 5536 had in the Superior Court of the State of California, in and for the County of Santa Clara, and being more particularly described as follows: Beginning at an iron pipe in the Southerly line of Ninth Street in the City of Gilroy at the most Northwesterly corner of the 5.22 Acre Tract of Land conveyed to Luigi Poletti by Deed recorded August 30, 1920 in Book 516 of Deeds at Page 508, Records of Santa Clara County, and running thence along the Southwesterly line of said lands of Poletti S. 21 deg 52' E. 521.02 feet; thence S. 70 deg 00" W. 40.02 feet to the most Easterly corner of the lands of the California Packing Corporation as described in Deed recorded in Book 452 at Page 456 Official Records of Santa Clara County; thence along the Northeasterly line of Said Land N. 21 deg 52' W. 521.02 feet to the most Northerly corner thereof in the Southerly line of Ninth Street; thence along the Southerly line of Ninth Street N. 70 deg 00' E. 40.02 feet to the Point of Beginning. Parcel Two: Being a portion of Ranch Lot 44 as shown on Map No. 7 accompanying the final report of the Referees in the Las Annimas Rancho Partition Suit, Action No. 5536 had in the Superior Court of the State of California, in and for the County of Santa Clara, and being more particularly described as follows: "Beginning as an iron pipe in the Southerly line of Ranch Lot 44 and the Northerly line of Bane Lane as shown on said Map distant thereon N. 890 45'W. 252.23 feet from the Southwest corner of Ranch Lot 45 and from which the southwest corner of the Tract conveyed to Hobbs by deed recorded in 1894 in Book 178 of Deeds as Page 11, Santa Clara County Records, bears S. 800 45' E. 42.63 feet, and running thence along the Southerly line of Ranch Lot 44 and the Northerly line of Bane Lane N. 890 45' W. 100 feet; thence N. 20° 00' W. 75.00 feet; thence N. 700 00' E. 93.82 feet; thence S. 200 00' E. 109.61 feet to the point of beginning. APN: 841 -16 -004, 841 -16 -029 -3- 4816- 6940- 7523v2 TMOREW04706012 EXHIBIT `B" IDENTIFICATION OF UNITS RESERVED FOR LOW INCOME HOUSEHOLDS Number of Units Number of Bedrooms 16 1 bedroom 99 2 bedroom 90 3 bedroom 28 4 bedroom The income levels of each household occupying a Unit shall not exceed sixty percent (60 %) of Median Income. IDENTIFICATION OF UNITS RESERVED FOR VERY LOW INCOME HOUSEHOLDS Number of Units Number of Bedrooms 2 1 bedroom 11 2 bedroom 10 3 bedroom 4 4 bedroom The income levels of each household occupying a Unit shall not exceed sixty percent (/o) of Median Income. 60'/. -1- 4816- 6940- 7523v2 TMORELL104706012