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HomeMy WebLinkAbout; CARLSBAD 685 LP; 2022-0478020; Affordable Housing-Regulatory Agreement & Dec. of Restrictive CovenantsRECORDING REQUESTED BY: First American Title Insurance Company National Commercial Services WHEN RECORDED MAIL DOCUMENT TO: Christensen & Spath LLP 401 West A Street, Suite 2250 San Diego, CA 92101 DOC# 2022-0478020 111111111111 lllll 111111111111111111111111111111 IIIII 111111111111111111 Dec 23, 2022 09:34 AM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $65.00 (SB2 Atkins: $0.00) PAGES: 18 _________________ __._ ____ space Above This Line for Recorder's Use Only _____ _ A.P,N.: 207-101-35-00 and 207-101-37-00 Property Address: 4901 El Camino Real and, 4926 Park Drive, Carlsbad, CA REGULATORY AGREEMENT Title of Document File No.: NCS-1022220-LA2 (TD) (X) Recorded [concurrently] in connection with a transfer of real property subject to the imposition of Documentary Transfer Tax per GC 27388.1 (a) (2). ( ) Recorded [concurrently] in connection with a transfer of real property that is residential dwelling to an owner- occupier per GC 27388.1 (a) (2). () Maximum fee of $225 has been reached per GC 27388.1 (a) (1). ( ) Not related to real property GC 27388.1 (a) (1). ( ) Transfer of real property subject to the imposition of Documentary Transfer Tax -GC 27388.1 (a)(2) () Transfer of real property that is a residential dwelling to an owner-occupier -GC 27388.1 (a)(2) ( ) Exempt from fee under GC 27388.1 due to being recorded in connection with a transaction that was subject to documentary transfer tax which was paid on document recorded ____ as Document No. ____ of Official Records ( ) Exempt from fee under GC 27388.1 due to the maximum fees having been paid on document(s) recorded ____ as Document No. ____ of Official Records - ( ) Exempt from fee under GC 27388.1 due to it being recorded in connection with a transfer of real property that is a residential dwelling to an owner-occupier. The recorded document transferring the dwelling to the owner- occupier was recorded ____ as document No. • of Official Records. () Exempt from fee under GC 27388.1 for the following reasons: ___ _ THIS PAGE ADDED TO PROVIDE EXEMPTION INFORMATION FOR THE BUILDING HOMES AND JOBS ACT FEE (SB-2; AFFORDABLE HOUSING FEE) ($3.00 Additional recording fee applies) NO CHARGE ON THIS DOCUMENT FOR THE BENEFIT OF THE CITY OF CARLSBAD Recording Requested By: When Recorded Mail To: Christensen & Spath LLP 401 West A Street, Suite 2250 San Diego, CA 92101 REGULATORY AGREEMENT (Marj a Acres) THIS REGULATORY AGREEMENT ("Regulatory Agreement") is dated as of the 1st day of December, 2022, by and between Carlsbad 685, L.P., a California limited partnership ("Developer") and the City of Carlsbad ("City") in connection with that ce1tain real property ("Property'') located in the City of Carlsbad, County of San Diego, California, described in Exhibit "A" attached hereto and incorporated herein by reference. RECITALS A The City has agreed to make a loan to Developer in the original principal amount of up to of Seven Hundred Fifteen Thousand and No/I 00 Dollars ($715,000.00) ("City Loan") pursuant to that certain Construction and Permanent Financing Loan Agreement (Marja Acres) ("Loan Agreement") between the Developer and City of even date herewith, B. The City Loan is conditioned by the City in part upon the recordation of this Regulatory Agreement setting forth certain restrictions upon the use and sale of the Property. Developer shall construct a new construction forty-seven ( 47) unit, multifamily affordable housing complex on the Property consisting of forty-six ( 46) affordable units ("Affordable Units") and one (1) manager's unit (collectively the "Project"). The Project is to be operated as low income housing for seniors in accordance with the terms of this Agreement. The City Loan is being funded by the City's Housing Trust Funds. This Regulatory Agreement is intended to and does restrict the Affordable Units in accordance with all requirements of the City's housing trust fund program. C. The Project is a portion of a larger housing development ("Master Project") which was approved by the City Council on November 3, 2020 as set forth in City Council Resolution No. 2020-215 ("City Council Resolution"). The City Council Resolution granted a density bonus ("Density Bonus") to the Master Project pursuant to California Government Code Section 65915 and the City's Residential Density Bonus and Incentives or Concessions ordinance (Carlsbad Municipal Code Title 21, Chapter 21.86). In exchange for and in order to obtain the Density Bonus and satisfy the requirements of the City Council Resolution, Developer has agreed to restrict the occupancy of the Affordable Units as set forth in this Regulatory Agreement. Development of the Master Project is also governed by the City's lnclusionary Ordinance (Carlsbad Municipal Code Title 21, Chapter 21.85). This Regulatory Agreement and the restriction of the Affordable Units as set forth herein satisfies the requirements of the City's Inclusionary Ordinance. NOW, THEREFORE, in furtherance of the recitals stated above, the mutual covenants set forth below, the parties agree, promise and declare as follows: 1. Restrictive Covenants. Developer agrees and covenants on behalf of itself and its successors and assigns, and each successor in interest to the Property, that at all times during the term of this Regulatory Agreement forty-six ( 46) residential units at the Project shall be set aside and reserved as "Affordable Units" for seniors (55+). As used herein the term "Affordable Units" shall refer to the forty-six ( 46) residential units in the Project which are owned or held available strictly in accordance with the terms and conditions set forth below. (a) Affordable Unit Restrictions. The following restrictions shall apply to the forty-six ( 46) Affordable Units. The restrictions set forth in the Table below shall establish the maximum rental rate, which shall be adjusted for household size appropriate for the unit. Rents shall also be adjusted to reflect a utility allowance. TABLE OF RENT AND INCOME RESTRICTION CRITERIA NUMBER OF UNIT TYPE MAXIMUM MONTHLY MAXIMUM AFFORDABLE RENTS INCOME OF UNITS ELIGIBLE TENANTS 5 lBR 30% CTAC Rents* 30%ofAMI 36 lBR 50% CTAC Rents* 50%ofAMI 5 lBR 60%HCD* 60%ofAMI TOTAL-46 *Note-In order to satisfy the Density Bonus requirements, the Developer is required to provide forty-six ( 46) Affordable Units with rents at or below 60% of AMI as determined by the California Department of Housing and Community Development. The Developer intends to charge rents for the 30% and 50% Affordable Units as determined by the California Tax Credit Allocation Committee. The City agrees to the same, provided that the maximum monthly rents for the 30% and 50% Affordable Units do not exceed the 60% rents as determined by the California Department of Housing and Community Development. (b) Eligible Tenants, "Eligible Tenants" are those tenants whose aggregate gross annual income does not exceed the respective percentages set forth in the Table of Rent and Income Restriction Criteria set forth in Section 1 (a), above, as adjusted for family size. For purposes of this Regulatory Agreement, the current annual area median income shall be the area median income defined by California Department of Housing and Community Development ("HCD") as the then current area median income for the San Diego-Carlsbad Metropolitan Statistical Area, as adjusted for family size. When determining income eligibility, Developer shall use actual household size. When determining rents, Developer shall use the household size appropriate for the Unit as determined by the HCD or TCAC. In the event HCD or TCAC ceases to publish an established area median income as aforesaid, City may, in its sole discretion, use any other reasonably comparable method of computing adjustments in area median income. Notwithstanding anything contained herein to the contrary, to the extent any other restrictions applicable to the Property limit the rent and/or occupancy of the Property, the most restrictive shall apply. (c) Minimum and Maximum Occupancy. Each of the one-bedroom Affordable Units shall be occupied by not less than one (1) person, nor more than three (3) people. (d) Occupancy by Senior Citizens. All Affordable Units shall be occupied only by "Senior Citizens," "Qualified Permanent Residents" and/or "Permitted Health Care Residents." The tenn "Senior Citizen" as used herein means a person 55 years of age or older. ( e) Qualified Permanent Resident. The term "Qualified Permanent Resident" as used herein means a person who meets both of the following requirements: (i) the person was residing with the Senior Citizen prior to the death, hospitalization, or other prolonged absence of, or the dissolution of marriage with, the Senior Citizen, and (ii) the person was 45 years of age or older, or was a spouse, cohabitant, or person providing primary physical or economic support to the Senior Citizen. (f) Additional Definition of Qualified Permanent Resident. The term "Qualified Permanent Resident" as used herein also means a disabled person or person with a disabling illness or injury who is a child or grandchild of the Senior Citizen who needs to live with the Senior Citizen because of the disabling condition, illness, or injury. For any person who is a Qualified Permanent Resident under this Section 1 (f) whose disabling condition ends, the Declarant may require the formerly disabled resident to cease residing in the development upon receipt of six months' written notice; provided, however, that the Declarant may allow the person to remain a resident for up to one year after the disabling condition ends. The Declarant may take action to prohibit or terminate occupancy by a person who is a Qualified Permanent Resident under this Section if the Declarant finds, based on credible and objective evidence, that the person is likely to pose a significant threat to the health or safety of others that cannot be ameliorated by means of a reasonable accommodation; provided, however, that the action to prohibit or terminate the occupancy may be taken only after doing both of the following: (i) providing reasonable notice to and an opportunity to be heard for the disabled person whose occupancy is being challenged, and reasonable notice . to the co-resident parent or grandparent of that person, and (ii) giving due consideration to the relevant, credible, and objective information provided in the hearing. The evidence shall be taken and held in a confidential manner, pursuant to a closed session, by the Declarant in order to preserve the privacy of the affected persons. The affected persons shall be entitled to have present at the hearing an attorney or any other person authorized by them to speak on their behalf or to assist them in the matter. (g) Permitted Health Care Resident. The term "Permitted Health Care Resident" as used herein means a person hired to provide live~in, long-term, or terminal health care to a Senior Citizen or Qualified Permanent Resident residing in the Project, or a family member of the Senior Citizen or Qualified Permanent Resident residing in the Project providing that care. For the purposes of this section, the care provided by a Permitted Health Care Resident must be substantial in nature and must provide either assistance with necessary daily activities or medical treatment, or both. A Permitted Health Care Resident shall be entitled to continue his or her occupancy, I l, residency, or use of the dwelling unit as a permitted resident in the absence of the Senior Citizen from the dwelling unit only if both of the following are applicable: (i) the Senior Citizen became absent from the dwelling due to hospitalization or other necessary medical treatment and expects to return to his or her residence within 90 days from the date the absence began, and (ii) the absent Senior Citizen or a~ authorized person acting for the Senior Citizen submits a written request to the Declarant stating that the Senior Citizen desires that the Permitted Health Care Resident be allowed to remain in order to be present when the Senior Citizen returns to reside in the development. Upon written request by the Senior Citizen or an authorized person acting for the Senior Citizen, the Declarant shall have the discretion to allow a Permitted Health Care Resident to remain for a time period longer than 90 days from the date that the Senior Citizen's absence began, if it appears that the Senior Citizen will return within a period of time not to exceed an additional 90 days. (h) Guests. A guest of a Senior Citizen or Qualified Permanent Resident, under 55 years of age shall be pennitted to temporarily reside in an Affordable Unit for periods oftime, not to exceed 60 days in any year. (i) Death or Dissolution of Marriage. Upon the death or dissolution of marriage, or upon hospitalization, or other prolonged absence of the Senior Citizen, any Qualified Permanent Resident shall be entitled to continue his or her occupancy, residency, or use of the dwelling unit as a permitted resident. This Section l (i) shall not apply to a Permitted Health Care Resident. 2, Occupancy Monitoring. Notwithstanding anything to the contrary set forth herein, the City may, in its sole discretion: (ii) rely on compliance monitoring done by other parties, including without limitation, the California Tax Credit Allocation Committee or the County of San Diego; or (ii) retain a third~party monitor to perform the monitoring functions set forth in this Section 2. (a) Approval of Eligible Tenants Prior to Occupancy. The eligibility of each prospective tenant under the restrictions set forth in this Regulatory Agreement shall be certified by Developer which shall submit such ce1iification and all supporting documentation on forms required by TCAC. (b) Determination; Annual Requalification. Upon completion of construction of the Project (the occurrence of which shall be evidenced by the issuance of a temporary certificate of occupancy for all units within the Project) and annually each year during of the term of this Regulatory Agreement, Developer shall certify to City that Developer is in compliance with this Regulatory Agreement under penalty of perjury, utilizing such fonns and providing such backup documentation as reasonably required by the City. Failure by Developer to timely comply with the tenant qualification and annual certification/requalification process described in this Section 2 shall constitute a material default under the Loan Agreement. The City may resort to the remedies set forth hereinbelow upon such material default, as well as any and all other remedies available at law or in equity and/or contained in the Loan Agreement (subject to the notice and cure provisions thereof, if any). 3. Relationship with Developer. The term "Eligible Tenant" shall not include Developer, or any individuals who are partners of Developer, or in any entity having an interest in Developer, or the Property, or any officer, employee, agent or consultant of the Developer, or any relative (by blood or marriage) of any officer, employee, agent or consultant of the Developer. This restriction shall not preclude occupancy by resident managers in the manager's unit. 4. No Student Dependents. The term "Eligible Tenant" shall not include any student dependent as defined in the U.S. Internal Revenue Code, unless the taxpayer (upon whom the student in question is dependent) resides in the same dwelling unit. 5. Income of Co-Tenants, Etc. The income of all co-tenants and/or non-dependent occupants, shall be taken into account in determining whether a household is an Eligible Tenant hereunder. 6. Eviction/Termination of Tenancy. Subject to provisions of applicable law (including, without limitation, fair housing laws) and other restrictions applicable to the Project, in the event that a tenant who was properly certified as an Eligible Tenant at the commencement of such tenant's occupancy ceases to be eligible, for any reason other than the tenant being over income, Developer shall have the right, but not the obligation, to either (i) give thi1ty (30) days written notice, or such longer period as prescribed by law, to such tenant to vacate the Affordable Unit, or (ii) refuse to renew such tenant's lease. Any vacated Affordable Unit shall thereafter be rented to an Eligible Tenant. In the event that a tenant who was properly certified as an Eligible Tenant at the commenceinent of such tenant's occupancy ceases to be eligible, as a result of being over income, the over-income tenant shall continue to be considered an Eligible Tenant and may have such tenant's lease renewed until such time as the Eligible Tenant's tenancy has terminated, provided this continued occupancy otherwise complies with the applicable regulations as referenced below, depending upon the sources of the restrictions involved: (a) City Restrictions. Except as otherwise provided in Section 6(6), below, a tenant who occupies an Affordable Unit and whose income increases to an amount at or above one hundred twenty percent (120%) of the area median income as then determined by HCD at the time of recertification, shall be given one hundred eighty (180) days' notice to vacate the Affordable Unit, effective from and after the date of such failure to requalify (i.e., the recertification date, provided the tenant was properly certified originally). During the time the over-income tenant resides in the Affordable Unit, the tenant shall continue to pay the restricted rent. The tenant shall continue to be considered an "Eligible Tenant" until the tenant moves, the tenant's lease is not renewed, or the tenant is evicted, provided this continued occupancy complies with all other applicable requirements of this Regulatory Agreement. (b) Tax Credit Funds. Notwithstanding Section 6(a), above, or anything else to the contrary set forth in this Regulatory Agreement, when a tenant occupies a unit subject to a regulatory agreement ("TCAC Regulatory Agreement") by and between the Developer and the California Tax Credit Allocation Committee ("TCAC") pursuant to Section 42 of the Internal Revenue Code, such tenant shall have its rent increased or shall be evicted as a result of such tenant being over income only as and when allowed by such TCAC Regulatory Agreement or by Federal law, including 26 U.S,C. §42. In the event of conflict between the over income regulations of this Regulatory Agreement and the TCAC Regulatory Agreement, the TCAC Regulatory Agreement provisions shall apply. 7. Physical Condition of Affordable Units. After completion of construction of the Project, Developer shall continually maintain the Affordable Units in a decent, safe and sanitary condition, reasonable wear and tear excepted. City shall have the right to inspect the Affordable Units from time to time upon reasonable advance written notice to Developer, in order to verify compliance with the foregoing maintenance covenant. Developer hereby consents to periodic inspection by City's designated inspectors and/or designees during regular business hours, including the Code Enforcement Agents of the City, to ensure compliance with all applicable zoning, building codes, regulations, and property standards. Any deficiencies in the physical condition of an Affordable Unit shall be conected by Developer at Developer's expense within sixty (60) days of the identification of such deficiency by City and delivery of written notice of the same to Developer, provided if the deficiency is of a nature that it cannot be cured within such sixty ( 60) day period, the Developer shall have such additional time to cure as is reasonably determined by the City. 8. City Monitoring Functions. It is contemplated that, during the term of this Regulatory Agreement, City will perform the following monitoring functions: (i) preparing and making available to Developer any general information that City possesses regarding income limitations and restrictions which are applicable to the Affordable Units; (ii) reviewing the documentation submitted by Developer in connection with the annual certification process for Eligible Tenants in accordance with Section 2, above; and (iii) inspecting the Affordable Units to verify that they are being maintained in accordance with Section 7 above. Notwithstanding the foregoing description of City's fllllctions, Developer shall have no claim or right of action against City based on any alleged failure to perform such function, except that Developer may reasonably rely upon City's tenant eligibility determination. 9. Successors Bound. Except for the Permitted Transfers approved under the Loan Agreement, Developer covenants, for itself and its successors and assigns, not to sell, transfer, assign or otherwise dispose of ownership of the Property, unless the prospective purchaser, transferee or assignee expressly promises in writing to be bound by all of the provisions hereof, including the covenant in this Section 8 to require successors to expressly assume the obligations herein. It is expressly acknowledged that the covenants and restrictions set forth herein shall survive any repayment of the City Loan. Further, the obligations of Developer hereunder shall be deemed independent of Developer's obligations under the Loan Agreement. 10. Maximum Rent To Be Collected by Developer. In no event, shall the "Total Rent," including the portion paid by the Eligible Tenant and any other person or entity, collected by Developer for any Affordable Unit exceed the amount of rent set forth in the Table set forth in Section 1 (a). Total Rent includes all consideration received by the Developer with respect to the applicable Affordable Unit, including, without limitation, payments made by the Eligible Tenant and all subsidies received by the Developer. In the case of persons receiving Section 8 benefits (or any similar vouchers), who are Eligible Tenants, the Developer acknowledges that it shall not accept any subsidy or payment that would cause the Total Rent received for any Affordable Unit to exceed the maximum rents allowed in the above-referenced Table, for any Affordable Unit. Total Rent shall not exceed the maximum rents as determined by HCD or TCAC (as applicable). i _ .. • ..... : : ·: .. --~----~ ~---·: ••• ••• -··-··1 1-- Should the Developer receive Total Rent in excess of the allowable maximum rent set forth in the Table, Developer agrees to immediately notify the City and reimburse such Eligible Tenant or the City for any such overpayment. Acceptance by Developer or its successors-in-interest, of Total Rent in excess of the maximum rent set forth in the Table and failure to reimburse such Eligible Tenant or the City for the excess shall constitute a material breach of this Regulatory Agreement and the Loan Agreement. 11. Loan Payments. Annual payments as referenced in the Loan Agreement shall be made to City as provided therein until the loan has been repaid. 12. Term. This Regulatory Agreement and the covenants and restrictions contained herein shall be effective commencing on the date this Regulatory Agreement is recorded and shall remain in full force and effect until 12:00 midnight on December 31, 2079. 13. Covenant Against Discrimination. Except as required to comply with the regulatory restrictions applicable to the Project, Developer covenants on behalf of itself and its successors and assigns, and each successor in interest to the Property, not to discriminate against any tenant or prospective tenant of any Affordable Unit on the basis of their race, age, sexual orientation, sexual identity, marital status, color, religion, sex, handicap, or national origin, as referenced in all applicable state, local and federal law. 14. Enforcement. Developer expressly agrees and declares that City or any successor public agency is a proper party and shall have standing to initiate and pursue any and all actions or proceedings, at law or in equity to enforce the provisions hereof and/or to recover damages for any default hereunder, notwithstanding the fact that such damages or the detriment arising from such default may have actually been suffered by some other person or the public at large. Further, City or any successor public agency shall be the proper party to waive, relinquish, release or modify the rights, covenants, obligations or restrictions contained in or arising under this Regulatory Agreement. 15. Severability. In the event that any provision or covenant of this Regulatory Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, then it shall be severed from the remaining portions of this Regulatory Agreement which shall remain in full force and effect. • 16. Covenants to Run With the Land. The covenants contained herein shall constitute "covenants running with the land", and shall bind the Property and every person having an interest therein during the term of this Regulatory Agreement. Developer agrees for itself and its successors that, in the event that, for any reason whatsoever, a court of competent jurisdiction determines that the foregoing covenants do not run with the land, such covenants shall be enforced as equitable servitudes against the Property. 17. Recordation; Waiver and Amendment. This Regulatory Agreement shall be recorded in the Office of County Recorder of San Diego, California. No provision of this Regulatory Agreement, or breach of any provision, can be waived except in writing. Waiver of any provision or breach shall not be deemed to be a waiver of any other provision, or of any subsequent br~ach ·······.-1 of the same or other provision. Except as otherwise provided herein, this Regulatory Agreement may be amended, modified or rescinded only in writing signed by Developer and the City. 18. Remedies. (a) Contract Governed by Laws of State of California. This Regulatory Agreement, its performance, and all suits and special proceedings under this Regulatory Agreement, shall be constituted in accordance with the laws of the State of California and Federal law, to the extent applicable. In any action, special proceeding, or other proceeding that may be brought arising out of, under or because of this Regulatory Agreement, the laws of the State of California and the United States, to the extent applicable, shall govern to the exclusion of the law of any other forum, without regard to the jurisdiction in which the action or special proceeding may be instituted. (b) Standing, Equitable Remedies; Cumulative Remedies, Developer expressly agrees and declares that City or any successor or public agency shall be the proper patty and shall have standing to initiate and pursue any and all actions or proceedings, at law or in equity, to enforce the provisions hereof and/or to recover damages for any default hereunder, notwithstanding the fact that such damages or the detriment arising from such a default may have actually been suffered by some other person or by the public at large. Further, Developer expressly agrees that receivership, injunctive relief and specific performance are proper pre-trial and/or post-trial remedies hereunder, and that, upon any default, and to assure compliance with this Regulatory Agreement. Nothing in this Section 18(6 ), and no recovery to City, sha11 restrict or limit the rights or remedies of persons or entities other than City, against Developer in connection with the same or related acts by Developer, The remedies set forth in this Section are cumulative and not mutually exclusive, except the extent that their award is specifically determined to be duplicative by final order of a court of competent jurisdiction. (c) Remedies at Law for Breach of Tenant Restrictions. In the event of any continuing material default hereunder regarding restrictions on the operation and the transfer of the Property (excluding Permitted Transfers) and the expiration of any applicable cure period provided under the Loan Agreement, City shall be entitled to, in addition to any and all other remedies available at law or in equity: (i) declare all of the City Loan to be all due and payable; and (ii) recover compensatory damages. The amount of such compensatory damages shall be the product of multiplying: (A) the number of months that the default in question has continued after the expiration of all applicable notice and cure periods the time of trial by (B) the result of subtracting the rents properly chargeable hereunder for the Affordable Units in question from the amount actually charged for those Affordable Units. Developer and City agree that it would be extremely difficult or impracticable to ascertain the precise amount of actual damages accruing to City as a result of such a default and that the foregoing formula is a fair and reasonable method of approximating such damages. City shall be entitled to seek and to recover damages in separate actions for successive and separate breaches which may occur. Further, interest shall accrue on the amount of such damages from the date of the breach in question after the expiration of all applicable notice and cure periods at the rate of ten percent ( 10%) per annum or the maximum rate then allowed by law, whichever is less. Nothing in this section shall preclude the award of exemplary damages as allowed by law. (d) Cure by Limited Partner. Notwithstanding anything to the contrary contained in this Regulatory Agreement, City hereby agrees that any cure of any default made or tendered by one or more of Developer's limited partners or its designee shall be deemed to be a cure by Developer and shall be accepted or rejected on the saI?e basis as if made or tendered by Developer. 19. City's Approval of Prope1ty Manager. At all times that this Regulatory Agreement is in force and effect, and City has served a thirty (30) day written notice of deficiencies in the property management for the Project, which deficiencies have not been rectified by Developer within the thirty (30) day period (unless such deficiency is not reasonably capable of being cured within such thirty (30) day period, then such reasonable amount of time as is needed not to exceed 90 days, provided Developer commences cure within such thirty (30) day period and continues to diligently pursue cure), then, City shall have the right, in its reasonable discretion subject to any approval rights of the senior lender and Developer's limited partner upon thirty (30) days written notice: (i) to require the retention of a professional property management firm to manage the Project; (ii) to approve, in advance and in writing, the retention of any such property management firm, including the terms of the contract governing such retention; and (iii) to require Developer to terminate any such property management firm, provided that such termination shall comply with the termination provisions of the management contract in question, and to require that Developer retain a replacement professional property management firm, acceptable to the Developer, in its reasonable discretion. Developer shall cooperate with City to effectuate City's rights. 20. Lease Provisions. Developer agrees that it will include in all of its leases and cause its successors in interest to include in all of their leases the following provision: Additional Lease Provisions/Annual Income Verification. Lessee/Tenant agrees, upon written request from the Landlord or the City of Carlsbad ("City"), to certify under penalty of perjury the accuracy .of all information provided in connection with the examination or reexamination of annual income of the tenant's household. Further, tenant agrees that the annual income and other eligibility requirements are substantial and material obligations of the tenancy and that the tenant will comply promptly with all requests for information with respect to the tenancy from the • landlord and/or City. Further, tenant acknowledges that tenant's failure to provide accurate infmmation regarding such requirements (regardless of whether such inaccuracy is intentional or unintentional) or the refusal to comply with the request for information with respect thereto, shall be deemed a violation of this lease provision, and a material breach of the tenancy and shall constitute cause for immediate termination of the tenancy. 21. Reserved. 22. Notices. Notices under this Regulatory Agreement shall be in writing and sent (a) by certified or registered U.S. mail, return receipt requested, (b) overnight by a nationally recognized overnight courier such as UPS Overnight or FedEx, or (c) by personal delivery. All notices shall be effective upon receipt ( or refusal to accept delivery). All notices shall be delivered to the following addresses (which addresses may be changed by written notice): ; i . City: Copy to: Developer: City of Carlsbad Attn. City Manager 1200 Carlsbad Village Drive Carlsbad, California 92008 Christensen & Spath LLP 401 West A Street, Suite 2250 San Diego, CA 92101 Carlsbad 685, L.P. c/o Carlsbad 685 GP, LLC 3200 Douglas Blvd., Suite 200 Roseville, California 95661 Attention: President with a copy to: Bocarsly Emden Cowan Esmail & Arndt LLP 633 West Fifth Street, 64th Floor Los Angeles, California 90071 Attention: Kyle Arndt And: Riverside Charitable Corporation 14131 Yorba St., Suite 204 Tustin, CA 92780 Attention: President with a copy to: Hobson Bernardino + Davis LLP 6060 Center Drive, 10th Floor Los Angeles 90045, CA Attention: Jason Hobson And: WNC Holding, LLC c/o WNC & Associates, Inc, 17782 Sky Park Circle Irvine, California 92614 Attention: Melanie Wenk with a copy to: Holland & Knight LLP 10 St. James A venue, 11th Floor Boston, Massachusetts 02116 Attention: Jonathan I. Sirois 23. Signature Authority. All individuals signing this Regulatory Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the City that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. IN WITNESS WHEREOF, the parties have executed this Regulatory Agreement on the date first set forth above. DEVELOPER: CARLSBAD 685, L.P., a California limited partnership By: Carlsbad 685 GP, LLC, a California limited liability company, its administrative general partner By: USA Properties Fund, Inc., a California corporation, its manager • By: By: Riverside Charitable Corporation, a California nonprofit public benefit corporation, its managing general partner By: Recinda Kay Shafer Deputy Executive Director [SIGNATURES CONTINUED ON FOLLOWING PAGE] ,·-··-•- L,---1-_; 1-·-. I,'.. ! • I !. Holland & Knight LLP 10 St. James A venue, 11th Floor Boston, Massachusetts 02116 Attention: Jonathan I. Sirois 23. Signature Authority. All individuals signing this Regulatory Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the City that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. IN WITNESS WHEREOF, the parties have executed this Regulatory Agreement on the date first set forth above. DEVELOPER: CARLSBAD 685, L.P., a California limited partnership By: Carlsbad 685 GP, LLC, a California limited liability company, its administrative general partner By: USA Properties Fund, Inc., a California corporation, its manager By: Geoffrey C. Brown, President By: Riverside Charitable Corporation, a California nonprofit public benefit corporation, its managing general partner By:q~y~~ Deputy Executive Director [SIGNATURES CONTINUED ON FOLLOWING PAGE] i ' I.·· CALIFORNIA ACKNOWLEDGMENT CIVIL CODE § 1189 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of Calif~~a . 1 . County of • :y la ~.f>r On 1-Z-/ J 3 },JO~;)d } 1 before me, .A·P1t1 I Date " . Here Insert Name and Title of th / r; ( \ -J:2. ·, personally appeared __ L::_-~"J~cZi_··H~{~'ff_C...c~:--.~~-··-' _(,.~:l,..,.JN,..,_Yl~ 0 ~~M~:~(~~r~~f-S-,-.g-ne-r-(s_) ____________ _ who 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. i············ ~ ~ •• : >-1, ANN PATCHEN f ~ • -; Notary Public• California z i ~ P!acer County s': •, Comml,sio_n I 2407672 - My Comm, Expires Jun 9, 2026 Place Notary Seal and/or Stamp Above I certify under PENAL TY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. OPTIONAL Completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. Description of Attached Document Title of Type of Document: ___________________________ _ Document Date: _____________________ Number of Pages: ___ _ Signer(s) Other Than Named Above: _______________________ _ Capacity(ies) Claimed by Signer(s) Signer's Name: ____________ _ Signer's Name: ____________ _ □ Corporate Officer -Title(s): ______ _ □ Corporate Officer -Title(s): ______ _ □ Partner -□ Limited □ General D Partner - D Umlted D General □ lndlvidual □ Attorney in Fact D Individual D Attorney in Fact □ Trustee □ Guardian or Conservator □ Trustee □ Guardian or Conservator □ Other: D Other: Signer is Representing: _________ _ Slgner is Representing: _________ _ ~~ ©2019 National Notary Association CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT CIVIL CODE§ 1189 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of ----0-r~a=n....,g""'e~------ On D't'l~Q\p.ef tS/202--].. before me, Bianca Cornejo, Notary Public Date Here Insert Name and Title of the Officer personally appeared Recinda Kay Shafer Name(s) of Signer(s) who 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. I certify under PENAL TY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Place Notary Seal Above ---------------OPTIONAL--------------- Though this section is optional, completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. Description of Attached Document Title or Type of Document: __________________________ _ Document Date: __________________ Number of Pages: _____ _ Signer(s) Other Than Named Above: ______________________ _ Capacity(ies) Claimed by Signer(s) Signer's Name: ___________ _ Signer's Name: ___________ _ □ Corporate Officer -Title(s): ______ _ □ Corporate Officer -Title(s): ______ _ □ Partner -□ Limited □ General □ Partner -□ Limited □ General □ Individual □ Attorney in Fact □ Individual □ Attorney in Fact □ Trustee □ Guardian or Conservator □ Trustee □ Guardian or Conservator □Other: ______________ _ □ Other: _____________ _ Signer Is Representing: ________ _ Signer Is Representing: ________ _ ~~~~~~~~ ©2016 National Notary Association• www.NationalNotary.org • 1-800-US NOTARY (1-800-876-6827) Item #5907 I I i. . . ·,. -: . ' --.... :--. ~-. CITY: City of Carlsbad By: ______ -----;,--~--,,;,-------- Scott Chadwick, Cit Approved as to form: City of Carlsbad Office of the City Attorney By: }()Q,L C¾= Ronald Kemp Assistant City Attorney CALIFORNIA ACKNOWLEDGMENT CIVIL CODE § 1189 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or valldity of that document. who proved to me on the basis of satisfactory evidence to be the person(:iwhose name¢) is!a/e subscribed' to the within instrument and acknowledged to me that he/shhttfy execul~d the same in his/hfr/t~ir authorized capacity(ies), and that by his/hlr/t~ir signature(£i on the instrument the person(s}, or the entity upon behalf of which the person(s) acted, executed the instrument. 1 • •: e ~H;Li~M~N;~;lle •1 ->lotary Public• C•llfornil i S•n Oiogo County ! Commission ~ ZJ 73071 - My Comm, E~p1tos Acg 31, 2025 Place Notary Seal and/or Stamp Above I certify under PENAL TY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. OPTIONAL Completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. Description of Attached D~ment .1.-,, (_ , J,.. _ ~ ~ Title or Type of Document: Kft¥l0~1tJVW2 ~_lv\ay(f--TS.CLlZ&7 Document Date: _____________________ Numberof Pages: ____ _ Signer(s} Other Than Named Above: ______________________ _ Capacity(ies) Claimed by Signer(s) Signer's Name: ____________ _ Signer's Name: □ Corporate Officer -Title(s): ______ _ □ Corporate Officer -Title(s): ______ _ □ Partner -□ Limited □ General □ Partner-:-□ Limited D General □ Individual □ Attorney ln Fact □ Individual D Attorney in Fact □ Trustee □ Guardian or Conservator □ Trustee □ Guardian or Conservator □ Other: D Other: Signer is Representing: _________ _ Signer fs Representing: _________ _ ©2019 National Notary Association i I I I ;I ; I '·-·1' :: -.. Exhibit "A" Legal Description Real property in the City of Carlsbad, County of San Diego, State of California, described as follows: LOT ONE OF MARJA ACRES, IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP NUMBER 16537, RECORDED IN THE OFFICE OF THE COUNTY RECORDER, OF SAN DIEGO COUNTY, DECEMBER 01, 2022 AS INSTRUMENT NO. 2022-7000617 OF OFFICIAL RECORDS. APN: 207-101-35-00 (portion) and 207-101-37-00 (portion)