HomeMy WebLinkAboutCarlsbad Veteran Housing LP; 2020-09-17;IO I 0\26\2824202.8
GROUND LEASE AGREEMENT
By and Between
the
CITY OF CARLSBAD
and
CARLSBAD VETERAN HOUSING, L.P.
(Windsor Pointe)
TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND EXHIBITS ............................................................................... I
Section 1.1
Section 1.2
Definitions ......................................................................................................... 1
Exhibits .............................................................................................................. 7
ARTICLE 2. LEASE OF THE PROPERTY ................................................................................... 8
Section 2.1
Section 2.2
Section 2.3
Section 2.4
Section 2.5
Section 2.6
Section 2.7
Property .............................................................................................................. 8
Term ................................................................................................................... 8
Use ..................................................................................................................... 8
Possession .......................................................................................................... 8
As-is Conveyance .............................................................................................. 8
Memorandum of Lease ................................................................................... I 0
Closing Costs ................................................................................................... 10
ARTICLE 3. RENT ....................................................................................................................... 11
Section 3.1
Section 3.2
Section 3.3
Section 3.4
Annual Rent. .................................................................................................... I I
Advances for Lease Obligations ..................................................................... 11
Net-Net-Net Lease ........................................................................................... 11
No Termination ............................................................................................... 1 I
ARTICLE 4. CONSTRUCTION OF IMPROVEMENTS ............................................................ 12
Section 4.1
Section 4.2
Section 4.3
Section 4.4
Section 4.5
Construction of Improvements ....................................................................... 12
Additio nal Construction on Property .............................................................. 13
Construction Standards ................................................................................... 14
No Liens .......................................................................................................... 18
Permits, Licenses and Easements ................................................................... 18
ARTICLE 5. USE, CHARACTER, OPERATION AND MAINTENANCE OF
IMPROVEMENTS ................................................................................................. 19
Section 5.1
Section 5.2
Section 5.3
Section 5.4
Section 5.5
Section 5.6
Section 5.7
Section 5.8
Section 5.9
Section 5.10
Section 5.11
Section 5.12
Section 5.13
Section 5. I 4
Section 5.15
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Required and Permitted Uses .......................................................................... 19
L imitations on Use .......................................................................................... 20
Operation of Development. ............................................................................. 21
Maintenance of Improvements ....................................................................... 22
Cost of Operation and Maintenance ofimprovements .................................. 22
The Landlord Not Obligated to Repair ........................................................... 22
Non-discrirnination .......................................................................................... 22
Compliance with Laws .................................................................................... 23
Property Tax.es ................................................................................................. 24
Limits of Tax Liability .................................................................................... 24
Apportionment of Taxes ................................................................................. 25
Tax Receipts .................................................................................................... 25
Evidence of Nonpayment. ............................................................................... 25
Assistance in Making Payments ..................................................................... 25
The Landlord's Right Cure .............................................................................. 25
TABLE OF CONTENTS
Section 5.1 6 Permitted Contests ........................................................................................... 25
Section 5.17 Service and Utilities ........................................................................................ 26
Section 5.18 Hazardous Materials ........................................................................................ 26
ARTICLE 6. TITLE TO IMPROVEMENTS; QU IET ENJOYMENT; INSPECTIONS ............. 28
Section 6.1
Section 6.2
Section 6.3
Section 6.4
Section 6.5
During the Term ............................................................... ; .............................. 28
After the Term ................................................................................................. 28
Benefits oflmprovements During Term ........................................................ 28
Quiet Enjoyment. ............................................................................................ 29
The Landl ord's Right of Inspection ................................................................ 29
ARTlCLE 7. ASSIGNMENT AND SUBLETTING .................................................................... 29
Section 7.1
Section 7.2
Section 7.3
Section 7.4
Section 7.5
Section 7.6
Section 7.7
Section 7.8
Definitions ....................................................................................................... 29
Purpose of Restrictions on Transfer; Applicability ........................................ 29
Prohibited Transfers ....................................................................................... .30
Permitted Transfers ......................................................................................... 30
Procedure for Landlord Approval of Certain Transfers ................................ .31
Effectuation of Certain Permitted Transfers ................................................... 32
Transfer by Landlord ....................................................................................... 32
Successors and Assigns ................................................................................... 33
ARTICLE 8. INSURANCE; DAMAGE AND DESTRUCTION OF IMPROVEMENTS .......... 33
Section 8.1
Section 8.2
Section 8.3
Section 8.4
Section 8.5
Section 8.6
Section 8.7
Insurance Requirements .................................................................................. 33
No Termination of Ground Lease; Obligation to Restore ............................. 33
Damage or Destruction Occurring Prior to Final Years of Term .................. 34
Damage or Destruction During Final Years of Term .................................... 35
Procedure for Repair and Restoration ............................................................. 35
Procedures Upon Permitted Termination ...................................................... .37
Prosecution of Claims .................................................................................... .38
ARTICLE 9. APPROVED SECURITY INTERESTS .................................................................. 38
Section 9.1
Section 9.2
Section 9.3
Section 9.4
Section 9.5
Section 9.6
Section 9.7
Right to Encumber the Leasehold Estate ........................................................ 38
Notice to Approved Security Interest Holders .............................................. .39
Right to Perform and Right to Cure ................................................................ 39
Notice and Right to Cure Defaults Under Approved Security
Interests ............................................................................................................ 40
Estoppel Certificates ....................................................................................... 40
Mortgage of Landlord's Estate ....................................................................... .40
Registration of Approved Security Interests ................................................. .40
ARTICLE IO. SURRENDER; HOLDING OVER ...................................................................... .4 1
Section I 0.1
Section I 0.2
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Surrender of Property ...................................................................................... 41
Holding Over ................................................................................................... 41
II
TABLE OF CONTENTS
Section I 0.3 No Merger ....................................................................................................... 42
ARTICLE 11 . EMINENT DOMAfN ............................................................................................ 42
Section 11 .1
Section 11 .2
Section 11 .3
Section 11 .4
Total Taking .................................................................................................... 42
Partial Taking .................................................................................................. 43
Temporary Taking ........................................................................................... 43
Notice of Taking; Single Proceeding ............................................................. .43
ARTICLE 12. EVENTS OF DEFAULT ...................................................................................... .44
Section 12.1
Section 12.2
Section 12.3
Events of Default. ............................................................................................ 44
Rights and Remedies ....................................................................................... 45
Default by the Landlord ................................................................................. .46
ARTlCLE 13. REPRESENTATIONS AND WARRANTIES .................................................... .47
Section 13. I Representation and Warranties of Tenant. .................................................... .4 7
ARTLCLE 14. MISCELLANEOUS PROYISIONS ..................................................................... .48
Section 14.1
Section 14.2
Section 14.3
Section 14.4
Section 14.5
Section 14.6
Section 14.7
Section 14.8
Section 14.9
Section 14.10
Section 14.1 1
Section 14.12
Section 14.1 3
Notice, Demands and Communication .......................................................... .48
Non-Liability of City Personnel. .................................................................... 50
Enforced Delay ................................................................................................ 50
lnspection of Books and Records ................................................................... 5 1
Title of Parts and Sections ............................................................................... 5 I
Indemnification ............................................................................................... 5 1
No Claims ........................................................................................................ 51
Applicable Law ............................................................................................... 52
Severability ...................................................................................................... 52
Legal Actions .................................................................................................. 52
Binding Upon Successors; Covenants to Run With Land ............................. 52
Relationship of Parties; City as Landlord ....................................................... 52
Time ................................................................................................................. 53
Section 14.14 Third-Party Beneficiary .................................................................................. 53
Section 14.15 Further Assurances .......................................................................................... 53
Section 14.16 Amendments .................................................................................................... 53
Section 14.17 Waivers ............................................................................................................ 54
Section 14.18 Entire Understanding of the Parties ................................................................ 54
Section 14.19 Survival. ........................................................................................................... 54
Section 14.20 Gender and Number. ....................................................................................... 54
Section 14.21 Multiple Originals; Counterparts .................................................................... 54
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Exhibit A
Exhibit B
Exhibit C
Exhibit D
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TABLE OF CONTENTS
Legal Description of the Property
List of Construction Plans
Memorandum of Lease
Insurance Requirements
IV
GROUND LEASE AGREEMENT
(Windsor Pointe)
THIS GROUND LEASE AGREEMENT (the "Ground Lease") is entered into as of
September Jl, 2020 (the "Effective Date"), by and between the City of Carlsbad, a municipal
corporation (the "Landlord" or the "Q!y_"), and Carlsbad Veteran Housing, L.P., a California
limited partnership (together with its permitted successors or assigns as more particularly set
forth herein, the "Tenant").
RECJTALS
A. Capitalized terms used, but not defined, in these recitals shall have the meaning
set forth in Section 1.1.
B. As of the Effective Date, the Tenant has conveyed the Property to the Landlord
pursuant to the Purchase Agreement, and the Landlord is the fee owner of the Property.
C. The Landlord desires to lease the Property to the Tenant for the development,
construction and operation of the Improvements.
NOW, THEREFORE, in consideration of the mutual promises contained in this Ground
Lease, the Landlord and the Tenant (each a "Party" and collectively, the "Parties") agree as
follows:
AGREEMENT
The foregoing recitals are hereby incorporated by reference and made part of this Ground
Lease.
ARTICLE I
DEFINITIONS AND EXHrBITS.
Section 1.1 Definitions.
The following capitalized terms have the meanings set forth in this Section 1.1 wherever
used in this Ground Lease, unless otherwise provided:
(a) "Affirmed" shall mean Affirmed Housing Group, Inc., a Delaware
corporation.
(b) "Approved Security Interest" means a mortgage, deed of trust, or other
reasonable method of security encumbering the Tenant's leasehold estate in the Property that: (i)
meets the requirements of this Ground Lease, and (ii) secures any loan and/or refi nancing
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approved by the Landlord pursuant to the City Loan Agreement. Any Approved Security
1 nterest permitted hereunder may consist of two (2) or more separate loans or other financing
arrangements from two (2) or more Approved Security Interest Holders. In the event two (2) or
more Approved Security Interest Holders each exercise their rights under this Ground Lease and
there is a conflict that renders it impossible to comply with all requests of Approved Security
Interest Holders, the Approved Security Interest Holders whose Approved Security r nterest
would have senior priority in the event of a foreclosure shall prevail.
(c) "Approved Security Interest Holder" means the holder or beneficiary of an
Approved Security Interest.
(d) "Area Median Income" means the median gross yearly income, adjusted
for actual number of persons in the applicable household , in the County as published from time
to time by HCD, TCAC, or any other financing source set forth in the City Loan Agreement. In
the event that such income determinations are no longer published, or are not updated for a
period of at least eighteen ( 18) months, the Landlord shal I provide the Tenant w ith other income
determinations that are reasonably similar with respect to methods of calculation to those
previously utilized by the Landlord and the Tenant to determine area median income.
(e) "Bankruptcy/In solvency Event" means any of the following:
(I) Insolvency. A court hav ing jurisdiction shall have made or entered
any decree or order (i) adj udging the Tenant (or any General Partner) to be bankrupt or insolvent,
(ii) approving as properly filed a petition seeking reorganization of the Tenant (or any General
Partner) or seeking any arrangement for the entity in question under the bankruptcy law or any
other applicable debtor's relief law or statute of the United States or any state or other
jurisdiction, (iii) appointing a receiver, trustee, liquidator, or assignee of the Tenant (or any
General Partner) in bankruptcy or insolvency or for any of its properties, or (iv) directing the
winding up or li quidation of the Tenant (or any General Partner), if any such decree or order
described in clause (i) to (iv), inclusive, shall have continued unstayed or undischarged for a
period of ninety (90) days unless a lesser time period will apply under this subsection; or the
Tenant (or any General Partner) shall have admitted in writing its inability to pay its debts as
they fall due or shall have voluntarily submitted to or filed a petition seeking any decree or order
of the nature described in clauses (i) to (iv), inclusive.
(2) Assignment; Attachment. The Tenant (or any General Partner)
shall have assigned its assets for the benefit of its creditors or suffered a sequestration or
attachment of or execution on any substantial part of its property, unless the property so
assigned, sequestered, attached or executed upon shall have been returned or released within
ninety (90) days after such event or prior to sooner sale pursuant to such sequestration,
attachment or execution.
(3) Suspension; Termination. The Tenant (or any General Partner)
shall have voluntarily suspended its business or fails to maintain its good standing for more than
sixty (60) consecutive days.
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(f) "Building Permit" means all building permit(s) for the Development
required under appli cable law to be obtained from the City or any other Governmental
Authorities.
(g) "Business Day" shall mean a day of the week on which the City is open to
the public for carrying on substantial ly all business functions of the City. In no event shall a
Saturday, Sunday, or any legal holiday in the State of California be considered a Business Day.
(h) "CEOA" means the California Environmental Quality Act (Public
Resources Code Section 21000 et seq.), and any state or local implementing guidelines in
connection therewith.
(i) "City" has the meaning set forth in the introductory paragraph hereof.
U) "City Deed of Trust" means the deed o f trust that will encumber the
Tenant's leasehold interest in the Property to secure repayment of the City Loan.
(k) "City Loan" means the loan made by City to the Tenant pursuant to the
City Loan Agreement in the total principal amount of up to Three Million Seven Hundred
Ninety-Three Thousand Three Hundred and Ninety-Two Do llars ($3,793,392).
(I) "City Loan Agreement" means the Construction and Permanent Loan
Agreement by and between the Landlord and the Tenant dated as of, or about, the Effective Date.
(m) "C ity Loan Documents" means the City Loan Agreement, the City Note,
the City Deed of Trust, the C ity Regulatory Agreement, and all other documents executed by the
Tenant in favor of the City in connection with the City Loan.
(n) "C ity Note" means the promissory note evidencing Tenant's obligation to
repay the City Loan.
(o) "City Regulatory Agreement" means the regulatory agreement and
declaration of restrictive covenants to be entered into by the Parties in connection w ith the City
Loan.
(p) "Code" means the [nternal Revenue Code of 1986, as amended, or any
subsequent federal law governing the payment of federal tax.
(q) "Construction Contracts" means, collectively, (I) that certain agreement
dated July 20, 2020, between the Tenant, as owner, and HA Builder Group, LLC, as contractor,
for the constructio n of the [mprovements, and (2) all other contracts between the Tenant and any
General Contractor(s) covering the construction of the Improvements or any Major Additional
lmprovements, as may be modified, amended, or replaced from time to time.
(r) "Construction Plans" means those certain plans and specifications for the
construction of the Improvements as more particularly set forth on Exhibit B.
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(s) "Control" shall mean direct or indirect management or control of: (I) the
managing member or members in the case of a limited liability company; (2) the managing
general partner or general partners in the case of a partnership; and (3) a majority of the directors
in the case of a corporation, as determined by the City.
(t) "County" means the County of San Diego, a political subdivision of the
State of California.
( u) "Default Interest Rate" means the rate of ten percent ( I 0%) per month
during the relevant period over which the Default Interest Rate is to be applied under thi s Ground
Lease, but in no event greater than the maximum rate permitted by law.
(v) "Development" means, collectively, (i) the Improvements, and (ii) the
Tenant's leasehold interest in the Property.
(w) "Development Documents" means the City Loan Documents, any
Regulatory Agreement(s), and any other agreement between the Landlord and the Tenant
regarding the Property or Development, as they may be amended, modified, or replaced from
time to time.
(x) "Effective Date" has the meaning set forth in the introductory paragraph
hereof.
(y) "General Contractor" shall mean any general contractor retained by the
Tenant to perform the initia l construction of the Improvements, or any Major Additional
Improvements.
(z) "General Partner" shall mean, collectively, the Tenant's administrative
general partner, AHG Windsor Pointe, LLC, a California limited liability company (the
"Administrative General Partner"), and the Tenant's managing general partner, Las Palmas
Foundation, a California non-profit public benefit corporation (the "Managing General Partner").
As the context may require, "General Partner" may refer to either of the Tenant's general
partners.
(aa) "Governmental Authority(ies)" means any federal, state, and/or local
agency, department, commission, board, bureau, administrative or regulatory body, or other
public instrumentality having jurisdiction over the Property or any portion thereof, including, but
not limited to, the City.
(bb) "Ground Lease" has the meaning set forth in the introductory paragraph
hereof.
(cc) "Hazardous Materials" means any substance, material, or waste which is:
(I) defined as a "hazardous waste", "hazardous material", "hazardous substance", "extremely
hazardous waste", "restricted hazardous waste", "pollutant" or any other terms comparable to the
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foregoing terms under any provision of California law or federal law; (2) petroleum ; (3) asbestos
and asbestos containing materials; (4) polychlorinated biphenyls; (5) radioactive materials; (6)
mold; (8) fungus (which has been or is proven to be harmful to human beings), or toxic and
mycotoxin spores; (9) MTBE; or (I 0) determined by California, federal or local governmental
authority to be capable of posing a risk of injury to health, safety, property or the e nvironment.
The term "Hazardous Materials" shall not include: (i) construction materia ls,
gardening materials, household products, office supply products or janitorial supply products
customarily used in the construction, maintenance, rehabilitation, or management of commercial
properties, buildings and grounds, or typically used in household activities, or (ii) certain
substances which may contain chemicals listed by the State of California pursuant to California
Health and Safety Code Section 25249.8 et seq., which substances are commonly used by a
significant portion of the population living within the region of the Improvements, including but
not limited to, cleaning supplies, prescription and over the counter drugs, alcoholic beverages,
aspirin, tobacco products, nutrasweet and saccharine, so long as such materials and substances
are stored, used, and disposed of in compliance with al l applicable Hazardous Materials Laws.
(dd) "Hazardous Materials Laws" means all federal, state, and local laws,
ordinances, regulations, orders and directives pertaining to Hazardous Materials.
(ee) "HCD" means the State of California Department of Housing and
Community Development, or any successor.
(ff) "Improvements" means the Units, and related improve ments proposed to
be constructed on the Property in accordance with the Construction Plans. The Improvements are
more particularly set forth in the Construction Plans, attached as Exhibit B.
(gg) "Insurance Trustee" shall have the meaning set forth in Section 8.5(c).
(hh) "Investor" means Raymond James Tax Credit Fund XX L.L.C., a Florida
limited liability company, or its affiliate, or its successors and/or assigns.
(ii) "Land Use Approvals" means any governmental or regulatory approvals,
permits or authority, other than the Building Permit, necessary for the development and
operation of the Improvements, including but not limited to, any requirements under CEQA, or
the State Density Bonus Law, Government Code Section 65915 et seq. (as applicable).
Qj)
Section 4.2(c).
"Major Additional Improvements" shall have the meaning set forth in
(kk) "Management Agent" means Solari Enterprises, Inc., or any other
management agent retained by the Tenant and approved by the Landlord in accordance with the
provisions of Article 5 to manage, or provide maintenance services to, the Development.
(II) "Memorandum of Lease" means the memorandum of th is Ground Lease to
be recorded against the Property substantially in the form attached as Exhibit C.
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(mm) "Official Records" means the official records of the County.
(nn) "Parties" has the meaning set forth in the Recitals hereto.
(oo) "Partnership Agreement" shall mean the Tenant's amended and restated
agreement of limited partnership by and among, the General Partner, the Investor, and James
Silverwood, an individual (as withdrawing limited partner) anticipated to be executed after the
Effective Date, as may be amended from time to time.
(pp) "Preliminary Title Report" means that certain Preliminary Title Report for
the Property dated August 28, 2020, issued by Corinthian Title Company, Order Number:
2004528-SH.
( qq) "Property" means that certain real property located at 3606-3618, 3630
Harding Street, and 965-967 Oak Avenue, Carlsbad, Californ ia, as more particularly described in
Exhibit A attached to and incorporated in this Ground Lease by this reference.
(rr) "Property Management Agreement" means the agreement(s) between the
Tenant and the Management Agent for the management and/or maintenance of the Property (as
applicable) as approved by the Landlord pursuant to this Agreement.
(ss) "Purchase Agreement" means that certain Purchase and Sale Agreement
dated as of September 1, 2020, by and between Tenant, as seller, and Landl ord, as purchaser.
(tt) "Regulatory Agreements" means, collectively, any regulatory agreement
regulating the use of the Property made by Tenant in favor ofTCAC, the County, and any other
financing source set forth in the City Loan Agreement, or any other regulatory agreement agreed
to by Tenant regulating the use of the Improvements.
(uu) "Related Entity Investor Transferee" means any of Special Limited
Partner, or any entity under the Control of, Controlling, or under common Control with, the
Investor.
(vv) "Relocation Laws" means the requirements of the Uniform Relocation
Assistance and Real Property Acqu isition Policies Act of 1970 ( 42 USC 460 1, et seq.) and
implementing regulations at 49 C.F.R. Part 24; Section I 04(d) of the Housing and Community
Development Act of 1974 and implementing regulations at 24 C.F.R. Part 42; the California
Government Code Section 7260 et seq. and implementing regulations at 25 California Code of
Regulations Sections 6000 et seq; and any City code requirement or regulation regarding
relocatio n payments or benefits, each to the extent applicable to the Tenant and/or the
Development.
(ww) "Rent" means the applicable amount set forth in Article 3, plus all other
amounts owed by the Tenant to the Landlord, under this Ground Lease.
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(xx) "Special Limited Partner" means any entity admitted to the Tenant as a
special limited partner, or its affiliate or its successors and assigns.
(yy) "Tax Credit Funds" means the proceeds from the sale of limited
partnership interests in the Tenant to the Investor in the anticipated amount set forth in the City
Loan Agreement, or such other amount as may be approved by the City based on the Tax Credit
Reservation.
(zz) "Tax Credit Reservation" means a preliminary reservation of federal or
state low income housing tax credits from TCAC dated as of February 18, 2020.
(aaa) "TCA_C" means the Califo rnia Tax Credit Allocation Committee.
(bbb) "Tenant" has the meaning set forth in the introductory paragraph hereof.
(ccc) "Tenant Event of Default" means an event described in Section 12.1 .
(ddd) "Term" means the term of this Ground Lease, commencing on the
Effective Date and ending on the earlier to occur of (I) the ninety-ninth (99th) an niversary of the
Effective Date; or (2) the date of any termination of this Ground Lease in accordance with the
provisions hereof.
(eee) "Transfer" has the meaning set forth in Section 7.1.
(fft) "Unit" means the approximately fifty (50) rental units of multi-family
housing, including two (2) managers' unit, proposed to be constructed on the Prope1ty in
accordance with the Construction Plans.
(ggg) "Veteran" means: (i) any person, regardless of discharge status, who
served in the active military, naval, or air service of the United States, or as a member of the
National Guard who was called to and released from active duty or active service, for a period of
not less than 90 consecutive days or was discharged from the service due to a service-connected
disability within that 90-day period; or (ii) any other definition of "veteran" utilized by HCD
following the Effective Date.
Section 1.2 Exhibits.
The following exhibits are attached to and incorporated into this Ground Lease:
Exhibit A:
Exhibit B:
Exhi bit C:
Exhibit D:
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Legal Description of the Property
List of Construction Plans
Memorandum of Lease
Insurance Requirements
7
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ARTICLE 2 .
LEASE OF THE PROPERTY
Section 2.1 Pro~.
Subj ect to the terms, covenants, and conditions hereof and in consideration of rents to be
paid pursuant.to this Ground Lease, the Landlord hereby demises and leases the Property to the
Tenant, and the Tenant hereby leases and takes from the Landlord, the Property.
Section 2.2 Term.
Unless sooner terminated pursuant to the provisions of this Ground Lease, this Ground
Lease shall continue in full force and effect for the Term, commencing on the Effective Date and
shall expire on midnight the day immediately preceding the ninety-ninth (99th) anniversary of
the Effective Date.
Secti on 2.3 Use.
Subject to the provisions of th is Ground Lease, the Tenant shall use the Property for the
construction, development and operation of the Improvements on the Property in accordance
with the restrictions and requirements set fo rth in Article 5.
Section 2.4 Possession.
The Landlord agrees to, and shall, provide possession of the Property to the Tenant
immediately fo llowing the Effective Date. To the best of the Landlord's knowledge, the Property
is subject only to the encumbrances listed in the Preliminary Title Report and such encumbrances
approved by the Landlord and recorded concurrently with the Memorandum of Lease.
Section 2.5 As-is Conveyance.
(a) As-ls. IMMEDIATELY PRIOR TO THE OCCURRENCE OF THE
EFFECTIVE DATE, THE TENANT WAS THE FEE OWNER OF THE PROPERTY,
AND AS OF THE EFFECTIVE DATE, TENANT HAS CONVEYED THE PROPERTY
TO THE LANDLORD PURSUANT TO THE PURCHASE AGREEMENT.
THEREFORE, TENANT ACCEPTS THE PROPERTY "AS IS," WITH NO
WARRANTIES OR REPRESENTATIONS, EXPRESS OR IMPLIED, BY LANDLORD
CONCERNING THE CONDITION OF THE PROPERTY, INCLUDING THE
PRESENCE OR ABSENCE OF ANY HAZARDOUS MATERIALS. TENANT HEREBY
AGREES AND ACKNOWLEDGES THAT EXCEPT IN THE EVENT OF ANY FRAUD,
MISREPRESENTATION, OR WITHHOLDING OF INFORMATION BY LANDLORD,
AND EXCEPT AS OTHERWISE SET FORTH HEREIN, LANDLORD MADE NO
REPRESENTATION AS TO ANY MATTERS CONCERNING THE PROPERTY,
INCLUDING WITHOUT LIMITATION: (A) THE QUALITY, NATURE, ADEQUACY
AND PHYSICAL CONDITION OF THE PROPERTY (INCLUDING, WITHOUT
LIMITATION, TOPOGRAPHY, CLIMATE, AIR, WATER RIGHTS, WATER, GAS,
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ELECTRICITY, UTILITY SERVICES, GRADING, DRAINAGE, SEWERS, ACCESS
TO PUBLIC ROADS AND RELATED CONDITIONS); (B) THE QUALITY, NATURE,
ADEQUACY, AND PHYSICAL CONDITION OF SOILS, GEOLOGY AND
GROUNDWATER; (C) THE DEVELOPMENT POTENTIAL OF THE PROPERTY,
AND THE PROPERTY'S USE, HABITABILITY, MERCHANTABILITY, OR FITNESS,
SUITABILITY, VALUE OR ADEQUACY OF THE PROPERTY FOR ANY
PARTICULAR PURPOSE; (D) THE PRESENCE OF ABSENCE OF HAZARDOUS
MATERIALS ON, UNDER OR ABOUT THE PROPERTY (OTHER THAN AS
EXPRESSLY SET FORTH HEREIN AND/OR AS DISCLOSED BY THE INSPECTION
REPORTS); AND (E) THE CONDITION OF TITLE TO THE PROPERTY. TENANT
AFFffiMS THAT TENANT HAS NOT RELIED ON THE SKILL OR .TTJDGMENT OF
LANDLORD OR ANY OF ITS AGENTS, EMPLOYEES OR CONTRACTORS TO
SELECT OR FURNISH THE PROPERTY FOR ANY PARTICULAR PURPOSE, AND
THAT LANDLORD MAKES NO WARRANTY THAT THE PROPERTY IS FIT FOR
ANY PARTICULAR PURPOSE, INCLUDING BUT NOT LIMITED TO, THE
CONSTRUCTION AND OPERATION OF THE IMPROVEMENTS. TENANT
ACKNOWLEDGES THAT IT USED ITS INDEPENDENT .TTJDGMENT AND MADE
ITS OWN DETERMINATION AS TO THE SCOPE AND BREADTH OF ITS DUE
DILIGENCE INVESTIGATION WHICH IT MADE RELATIVE TO THE PROPERTY
AND RELIED UPON ITS OWN INVESTIGATION OF THE PHYSICAL,
ENVffiONMENT AL, ECONOMIC AND LEGAL CONDITION OF THE PROPERTY
(INCLUDING, WITHOUT LIMITATION, WHETHER THE PROPERTY IS LOCATED
IN ANY AREA WHICH IS DESIGNATED AS A SPECIAL FLOOD HAZARD AREA,
DAM FAILURE INUNDATION AREA, EARTHQUAKE FAULT ZONE, SEISMIC
HAZARD ZONE, IDGH FIRE SEVERITY AREA OR WILDLAND FIRE AREA, BY
ANY FEDERAL, STATE OR LOCAL AGENCY). TENANT UNDERTAKES AND
ASSUMES ALL RISKS ASSOCIATED WITH ALL MATTERS PERTAINING TO THE
PROPERTY'S LOCATION IN ANY AREA DESIGNATED AS A SPECIAL FLOOD
HAZARD AREA, DAM FAILURE INUNDATION AREA, EARTHQUAKE FAULT
ZONE, SEISMIC HAZARD ZONE, HIGH FIRE SEVERITY AREA OR WILDLAND
FIRE AREA, BY ANY FEDERAL, STATE OR LOCAL AGENCY.
(b) Acknowledgement. Tenant acknowledges that the Rent required under
this Ground Lease reflects the "as is" nature of this transaction and any faults, liabilities, defects
or other adverse matters that may be associated with the Property. Tenant has full y reviewed the
disclaimers and waivers set forth in this Ground Lease with Tenant's counsel and understands the
significance and effect thereof. Tenant further acknowledges and agrees that: (i) to the extent
required to be operative, the disclaimers of warranties contained in th is Section hereof are
"conspicuous" disclaimers for purposes of all applicable laws, statutes, codes, ordinances, orders,
rules, regulations and requirements of all Governmental Authorities and the appropriate
agencies, officers, departments, boards and commissions thereof, whether now or hereafter in
force, applicable to Landlord, Tenant, or the Property, or any portion thereof; and (ii) the
disclaimers and other agreements set forth in such sections are an integral part of this Ground
Lease, that this Ground Lease has been adjusted to reflect the same and that Landlord would not
have agreed to lease the Property to Tenant pursuant to this Ground Lease without the
disclaimers and other agreements set forth in this Section.
9
IO I 0\26\2824202.8
(c) Tenant's Release of the Landlord. Except with respect to any Landlord
Released Party's (as defined below) gross negligence, fraud, illegal acts, misrepresentation,
breach of any representation or warranty or other requirement or obligation set forth herein, or
otherwise except as expressly set forth in this Ground Lease, Tenant, on behalf ofitselfand
anyone claiming by, through or under Tenant hereby waives its right to recover from and fully
and irrevocably releases Landlord, its councilmembers, officers, employees, and agents
(collectively, "Landlord Released Parties") from any and all claims that Tenant may have or
hereafter acquire, on or after the Effective Date, against any of the Landlord Released Parties for
any costs, loss, liability, damage, expenses, demand, action or cause of action arising from or
related to: (i) the condition (including any construction defects, errors, omissions or other
conditions, latent or otherwise), valuation, salability or utility of the Property, or its suitability for
any purpose whatsoever; and (ii) any presence of Hazardous Materials at the Property.
(d) Waiver of California Civil Code Section 1542. Tenant agrees that, with
respect to the general release contained in Section 2.5(c) above, the general release extends to all
matters regarding the Property, whether or not claimed or suspected, as of and including the
Effective Date, and constitutes a waiver of each and all the provisions of the California Civil
Code Section 1542, which reads as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
THAT THE CREDITOR OR RELEASING PARTY DOES NOT
KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT
THE TIME OF EXECUTING THE RELEASE AND THAT, IF
KNOWN BY HIM OR HER, WOULD HA VE MA TERI ALLY
AFFECTED HIS OR HER SETTLEMENT WITH THE
DEBTOR OR RELEASED PARTY."
Tenant herein acknowledges that the effect and import of the provisions of California
Civil Code§ 1542 have been explained to it by its own counsel. Tenant understands and
acknowledges the significance and the consequence of such specific waiver of unknown claims
and hereby assumes ful l responsibility for any injuries, damages, losses or liabilities that it may
hereinafter incur from the waiver of these unknown claims.
Tenant Initials:
Section 2.6 Memw111uu111 Ul Lc;(l:,c;
The Parties shall execute and acknowledge the Memorandum of Lease, in the form
attached hereto as Exhibit C, which the Tenant shall cause to be recorded against the Property at
the Tenant's expense.
Section 2.7 C losing Costs.
The closing costs associated with execution of this Ground Lease and recordation of the
Memorandum of Lease including, but not limited to recording charges, County documentary
10
IO 10\26\2824202.8
(c) Tenant's Release of the Landlord. Except with respect to any Landlord Released Party's (as defined below) gross negligence, fraud, illegal acts, misrepresentation,
breach of any representation or warranty or other requirement or obligation set forth herein, or otherwise except as expressly set forth in this Ground Lease, Tenant, on behalf of itself and anyone claiming by, through or under Tenant hereby waives its right to recover from and fully and irrevocably releases Landlord, its councilmcmbers, officers, employees, and agents (collectively, "Landlord Re!ramd Parties") from any and all claims that Tenant may have or hereafter acquire, on or after the Effective Date, against any of the Landlord Released Parties for any costs, loss, liability, damage, expenses, demand, action or cause of action arising from or related to: (i) the condition (including any construction defects, errors, omissions or other conditions, latent or otherwise), valuation, salability or utility of the Property, or its suitability for any purpose whatsoever; and (ii) any presence of H87.81'dous Materials at the Property.
(d) Waiver of California Civil Code Section 1542. Tenant agrees~ with respect to the general release contained in Section 2.5(c) above, the general release extends to all matters regarding the Property, whether or not claimed or suspected, as of and including the Effective Date, and constitutes a waiver of each and all the provisions of the California Civil Code Section 1542, which reads as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
TIIAT THE CREDITOR OR RELEASING PAR1Y DOES NOT
KNOW OR SUSPECT TO EXIST IN ms OR HER FAVOR AT
THE TIME OF EXECUTING THE RELEASE AND THAT, IF
KNOWN BY HIM OR HER, WOULD HA VE MATERIALLY
AFFECTED HIS OR HER SETTLEMENT WITII THE DEBTOR OR RELEASED PARTY."
Tenant herein acknowledges that the effect and import of the provisions of California Civil Code § 1542 have been explained to it by its own counsel Tenant understands and acknowledges the significance and the consequence of such specific waiver of unknown claims and hereby assumes full responsibility for any injuries, damages, losses or liabilities that it may hereinafter incur from the wa,wEr'pf these unknown claims.
Tenant Initials:
Section 2.6
The Parties shall execute and acknowledge the Memorandum of Lease, in the form attached hereto as Exhibit C, which the Tenant shall cause to be recorded against the Property at the Tenant's expense.
Section 2.7 Closing Costs.
The closing costs associated with execution of this Ground Lease and recordation of the Memorandum of Lease including, but not limited to recording charges, County documentary
10 l01~124202.1
transfer tax, and conveyance taxes (if any) and the cost of the Tenant's title insurance policy shall
be borne by the Tenant. Each Party shall bear its own attorneys' fees and costs.
ARTICLE 3.
RENT
Section 3.1 Annual Rent. The Tenant sha ll pay, on an annual basis, rent in the amount
of One Dollar ($1.00) per year. As of the Effective Date, the Parties agree and acknowledge that
the Tenant has prepaid all of the annual rent for the Term, in the total amount of Ninety-Nine
Dollars ($99.00).
Section 3.2 Advances for Lease Obligations.
In addition to and not by way of limitation of Landlord's rights under specific provisions
of this Ground Lease, during the continuance of a Tenant Event of Default, the Landlord shall
have the right (at its sole election and without any obligation so to do) to advance on behalf of
the Tenant any mandatory amount due and payable under this Ground Lease by the Tenant, or to
otherwise satisfy any of the Tenant's obli gations under this Ground Lease (subject to applicable
notice and cure rights), provided that (except in case of emergency calling for immediate
payment) the Landlord shall first have given the Tenant no less than ten (10) Business Days
advance written notice of the Landlord's intention to advance such amounts on behalf of the
Tenant. No advance by the Landlord shall operate as a waiver of any of the Landlord's rights
under this Ground Lease and the Tenant shall remain fu lly responsible for the performance of its
obligations under this Ground Lease. A ll amounts advanced by the Landlord shall be separate
from and additional to the Rent, and shall be immediately due and payable by the Tenant to the
Landlord and shall bear interest from the date of advance at the Default r nterest Rate. Al I
amounts advanced by the Landlord pursuant to this Section 3.3 or similar provisions of this
Ground Lease are hereinafter referred to as "Advances."
Section 3.3 Net-Net-Net Lease.
This Ground Lease is a net-net-net lease, and Rent and other payments payable to or on
behalf of the Landlord shall : (a) be paid without notice or demand (except as expressly provided
herein) and without offset, counterclaim, abatement, suspension, deferment, deduction or
defense; and (b) be an absolute net return to the Landlord, free and clear of any expenses,
charges or offsets whatsoever.
Section 3.4 No Termination.
Except as otherwise expressly provided in thi s Ground Lease, this Ground Lease shall not
terminate nor shall the Tenant be entitled to the abatement of any Rent or other payment due or
any reduction or al location thereof, nor shall the obligations of the Tenant under this Ground
Lease be otherwise affected by reasons of any damage to or destruction of all or any patt of the
Development from whatever cause, or a taking of the Development or any portion thereof by
condemnation, requisition or otherwise for any reason whatsoever, or the prohibition, limitation
11
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or restriction of the Tenant's use of all or any part of the Development, or the interference with
such use by any person, or by reason of the termination or foreclosure of any mortgage, or for
any other cause whether similar or dissimilar to the foregoing, any present or future law to the
contrary notwithstanding, it being the intention of the Parties that the obligations of the Tenant
shall be separate and independent covenants and agreements, that the Rent and all other
payments payable by the Tenant under this Ground Lease shall continue to be payable in al l
events, and that the obligations of the Tenant under this Ground Lease shall continue unaffected,
un less the requirement to pay or perform the same shall have been terminated pursuant to an
express provision of this Ground Lease; provided, however, that during the continuance of any
such damage, destruction, taking, prohibition, limi tation, interference, eviction or foreclosure,
the Tenant shall not be obligated to perform any obligations which are no longer capable of
being performed as a result of such event.
ARTICLE 4.
CONSTRUCTION OF IMPROVEMENTS
Section 4.1 Construction of lm.Q_rovements.
(a) Specific Standards. Within the time and in the manner set forth in this
Ground Lease, the Tenant shall construct, or cause to be constructed on the Property, the
Improvements, as required by the Development Documents, and this Ground Lease. The
Improvements shall be constructed in fu ll conformity with the Land Use Approvals, and the
Construction Plans, attached as Exhibit B, as may be amended pursuant to this Ground Lease.
If the Tenant desires to make any Material Change (as defined below) in the
Construction Plans then in effect, the Tenant shall first submit, or cause to be submitted, to the
Landlord in accordance with Section 14.1 such plans or other information which document the
desired change. Notwithstanding the foregoing, if the Construction Plans, as modified by the
desired change, conform to the requirements of this Ground Lease, the Development Documents,
and the Land Use Approvals, no Landlord consent shall be required, however, if the
Construction Plans, as modified by the desired change, do not conform to the requirements of
this Ground Lease, the Development Documents, and the Land Use Approvals, the Landlord
shall approve or disapprove the change by notifying the Tenant in writing within thirty (30) days
of the submission of the request for the Material Change. Subject to Tenant's compliance with
Section 14.1 ( c) hereof, if the Landlord does not approve or disapprove within such thirty (30)
day period, the proposed change shall be deemed approved. If the proposed change is
disa pproved by the Landlord, the disapproval shall state with reasonable specificity the basis for
disapproval. Until and unless such change is approved by the Landlord, the previously approved
Construction Plans shall remain in effect.
For purposes of this Article 4, a "Material Change" is one involving a change in
the exterior design, exterior building materials or colors, or a change in interior design that, in
each case, would materially affect the uses to which the Improvements may be put, a change that
will reduce the number of bedrooms within a Unit, or that will reduce the total number of Units.
12
IO I 0\26\2824202.8
(b) Commencement and Completion. The Tenant shall commence and shall
thereafter complete the Improvements in accordance with the schedule set forth in the C ity Loan
Agreement. Once the Tenant commences construction of the Improvements, the Tenant shall not
halt, or permit the cessation of construction for such work except as provided in the City Loan
Agreement.
Section 4.2 Additional Construction on Pro~.
(a) General Standards. Any additional building erected on any portion of the
Property permitted under this Ground Lease (other than the initial construction of the
Improvements pursuant to Section 4.1 ), and any alteration, construction, remodeling,
reconstruction or repair work undertaken on or within any existing building on any portion of the
Property shall at al I times be of a quality of construction and architectural design consistent with
the Improvements as originally constructed. Any Major Additional Improvements (as defined
below), once commenced, shall be diligently prosecuted, and completed (1) only after the Tenant
has obtained the Landlord's prior written approval for such Major Additional Improvements,
such approval not to be unreasonably withheld, conditioned or delayed, (2) without mate rial cost
to the Landlord, (3) in good and workmanlike manner, and (4) in accordance with any plans and
specifications approved by the Landlord pursuant to subsection (b) below. The Tenant shall
secure all Land Use Approvals for such Major Additional Improvements, to the extent required
under applicable law, prior to submitting any construction plans to the Landlord under this
Section 4.2.
(b) Approval of Plans. Prior to commencing construction of any Major
Additional Improvements (as defined below), the Tenant shall submit to the Landlord for the
Landlord's reasonable approval plans and specifications for such work which, to the extent
relevant, shall contain the same information as set forth in the Construction Plans. The Landlord
shall approve or disapprove (in the Landlord's reasonable di scretion) such plans and
specifications in writing within sixty (60) days of submission. Any disapproval shall state with
specificity the reasons for such disapproval. Subject to Tenant's compliance with Section 14.1 (c)
hereof, the Landlord's fai lure to either approve or disapprove the construction plans within such
sixty (60) day period shall be deemed approval.
If rejected by the Landlord in whole or in part (in the Landlord's reasonable
discretion), the Tenant shall submit new or corrected construction plans within thirty (30) days of
notification of the Landlord's disapproval. The Landlord shall then have thirty (30) days to review
and approve the Tenant's new or corrected construction plans. Subject to Tenant's compliance with
Section 14.1 (c) hereof, the Landlord's failure to either approve or disapprove the construction plans
within such thirty (30) day period shall be deemed approval. The provisions of this Section 4.2
relating to time periods for approval, rejection, or resubmission of new or corrected construction
plans shall continue to apply until construction plans have been approved by the Landlord (or
deemed approved) at which time they shall be attached to and become a part of this Ground Lease
as if fu lly set forth herein. Only upon approval of the construction plans by the Landlord shall this
condition be met.
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1010126\2824202.8
ln the event that prior to or during the course of construction, the Tenant desires
to make any material change in the Major Additional Improvements from that contemplated in
the approved plans and specifications, the Tenant shall, prior to making such change, submit to
the Landlord such plans or other information which document the desired change. The Landlord
shall approve or disapprove such change within thirty (30) days of its submission to the
Landlord. Subject to Tenant's compliance with Section 14.l(c) hereof, the Landlord's fai lure to
either approve or disapprove such change within such thirty (30) day period shall be deemed
approval. Any disapproval shall state with reasonable specificity the basis for such disapproval.
Un less such change is approved, the previously approved plans and specifications shall remain in
effect.
(c) "Major Additional Improvements" means any of the following: (1) any
new buildings, structures or outdoor facilities to be located on the Property after the completion
of the initial construction of the Improvements, (2) construction of additional spaces or facilities,
(3) any other alteration, construction, remodeling or reconstruction after the completion of the
initial construction of the Improvements with a cost in excess of Two Hundred Fifty Thousand
Dollars ($250,000), or (4) a change that w ill reduce the number of bedrooms within a Unit, or the
number of Un its at the Property. A lteration, construction, remodeling, or reconstruction not
constituting a Major Additional Improvement shall not require the Landlord's consent or
approval of plans and specifications, but must be designed and performed in accordance with the
General Standards set forth in subsection (a) above.
Section 4.3 Construction Standards.
(a) General Standards. All construction of the Improvements, and alteration
or repair work permitted by this Ground Lease shall, subject to Section 4. l(b) above, be
accompli shed expeditiously and diligently by reputable licensed contractor(s), approved by the
Landlord in accordance with the provisions of Section 4.3U), below.
To the extent applicable, the Tenant shall take al l reasonably necessary measures
to minimize any damage caused by such work and make adequate provision for the safety of all
persons affected thereby. The Tenant sha ll repair, at the Tenant's own cost and expense, any and
all damage caused by such work and shall restore the area upon which such work is performed to
a condition which is equal to or better than the condition which existed prior to the beginning of
such work, subject to changes resulting from the performance of such work. In addition, the
Tenant shall pay a ll costs of and expenses of any work performed on the Property, and sha ll
indemnify and hold the Landlord and the Landlord's councilmembers, commissioners, directors,
officers, employees, agents, and successors and assigns, harmless from all damages, losses or
claims attributable to the performance of such work, except to the extent that such damage, loss,
or claim arises from the gross negligence, willful misconduct, illegal acts or breach of this
Ground Lease by the Landlord, or its councilmembers, commissioners, directors, officers,
employees and agents.
(b) Compliance with Construction Documents and Laws; Issuance of Permits.
All Improvements and any Major Additional Improvements shall be constructed in all material
respects in compliance with the requirements of the construction documents approved by the
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1010\26\2824202.8
Landlord, in accordance with this Ground Lease (if applicable), the Development Documents,
and also in strict compliance w ith all applicable local, state and federal laws and regulations.
T he Tenant shall have the sole responsibility for obta ining all necessary permits required under
appli cable law for such construction and shall make any application for such permits d irectly to
the Governmental Authorities having j urisdiction.
(c) Construction Safeguards. The Tenant shall erect and properly maintain at
all times during construction of the Improvements, all reasonable safeguards for the protection of
workers and the public as required by applicable law.
(d) Rights of Access. Representatives of the Landlord shall have the
reasonable right of access to the Property and the Improvements thereon without charges or fees,
at normal construction hours during the period of construction, for the purposes of ascertaining
compliance with the terms of this Ground Lease, including, but not limited to, the inspection of
the construction work being performed, prov ided that such representatives shall be those who are
so identified in writing by the Land lord, sha ll be accompanied by the Tenant's representatives if
the Tenant so desires, shall comply with the Tenant's contractor's reasonable rules for the
construction site, and shall provide the Tenant w ith forty-eight (48) hours' notice prior to any
such inspection.
(e) Notice of Completion. Upon completion of the Improvements and any
Maj or Additional Improvements, the Tenant shall fi le or cause to be fi led in the Official Records
a notice of completion with respect to the applicable construction, and the Tenant shall deliver to
the Land lord, at no cost to the Landlord, two (2) sets of the final as-built plans and specifications
of the Improvements, or Major Additional Improvements, as applicable.
(t) Discharge of Liens. The Tenant shall not permit or suffer any lien
(including, but not limited to, the liens of mechanics, laborers, materi al men, suppliers or
vendors for work or materials alleged to be done o r furnished in connection w ith the Property
and the Improvements thereon), encumbrances or other charge to be recorded or filed against the
Property and the Improvements thereon, or any part thereof, or upon the Tenant's leasehold
interest therein, except as otherwise permitted under this Ground Lease.
Notwithstanding the foregoing, the Tenant shall have the right to contest in good
faith and by appropriate legal proceedings the vali dity or amount of any mechanics', laborers',
materialmen's, suppliers' or vendors' lien or other c laimed li en; provided that the Tenant shall
utilize all reasonable means (including the posting of adequate security for payment) to protect
the Property, and any part thereof, or the improvements thereon against fo reclosure, and shall
indemnify and hold harm less the Landlord from any adverse effects resulting from such lien,
except to the extent arising from the Land lord's gross negligence, willful misconduct, illegal acts
or breach of this Ground Lease.
(g) Protection of the Landlord. Nothing in this Ground Lease shall be
construed as constituting the consent of the Landlord, expressed or imp I ied, to the performance
of any labor or the furni shing of any materials or any specific improvements, alterations of or
repairs to the Property or the Improvements thereon, or any part thereof, by any contracto r,
15
IO I 0\26\2824202.8
subcontractor, laborer or materialman, nor as giving the Tenant or any other person any right,
power or authority to act as agent of or to contract for, or permit the rendering of, any services or
the furni shing of any materials in such manner as would give rise to the tiling of mechanics' liens
or other claims against the fee interest of the Property. The Landlord shall have the right at all
reasonable times to post and keep posted on the Property any reasonable notices which the
Landlord may deem reasonably necessary for the protection of the Landlord and of its fee
interest in the Property from mechanics' liens or other claims, including, but not limited to, a
notice of non-responsibility pursuant to California Civil Code Section 8444. In addition, but
subject to the second paragraph of subsection (t) above, the Tenant shall make, or cause to be
made, prompt payment of all mon ies due and legally owing to all persons doing any work or
furn ishing any materials or supplies to the Property by through or under Tenant, or any of its
respective contractors or subcontractors in connection with the Property and the Improvements
thereon.
(h) The Tenant to Furnish and Equip the Improvements. The Tenant
covenants and agrees to furnish and equip the Improvements, or any Major Additional
Improvements, with all fi xtures, furnishings, equipment and other personal property
(collectively, the "Personal Property") of a quantity as necessary to operate the Improvements in
accordance with the standards set forth in this Ground Lease and the Development Documents.
As used in this Ground Lease, the term "Personal Property" includes all such replacements and
renewals, and all fixtures, furnishings, equipment and other personal property of the Tenant
located in, on or about the Property and the Improvements thereon; provided, however, for the
avoidance of doubt, the Parties agree and acknowledge that the Tenant has no obligation to
furnish the Units, and the term "Personal Property" excludes the furniture, or other personal
property, of any occupant of the Units. Any and all fixtures, furnishings, equipment and other
personal property placed in, on or about the Property shall be the Personal Property of the Tenant
during the Term of this Ground Lease.
(i) Performance and Payment Bonds. Un less otherwise waived by Landlord,
prior to commencing construction of the Improvements or any Major Additional Improvements,
the Tenant shall obtain and provide to the Landlord evidence of one ( 1) labor and material, and,
one ( 1) performance, bond issued by a reputable insurance company I icensed to do business in
California, and named in the current list of "Surety Compani es Acceptable on Federal Bonds" as
published in the Federal Register by the Audit Staff Bureau of Accounts, U.S. Treasury
Department, and reasonably acceptable to the Landlord, each in a penal sum of not less than one
hundred percent ( 100%) of the scheduled cost of construction on the Property. The Landlord
shall be named as an obligee under those bonds.
Within ten ( 10) days after receipt, the Landlord shall, in its reasonable discretion,
review and approve or disapprove the bonds or other security, providing said bonds meet the
reasonable requirements of the Landlord as to form, content, and issuer, and shall notify the
Tenant of any deficiency. If the bonds are not approved, the Tenant shall resubmit updated
bonds with in five (5) days after receipt of notice. The review and submittal periods shall
continue to apply unti l the bonds or other security are approved by the Landlord. Only upon
final approval shall th is condition be met. No work shall be initiated until approval of the bonds
has been received.
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U) Contractor(s). The Improvements and any Major Additional
Improvements shall be performed by a General Contractor reasonably satisfactory to the
Landlord, having the reputation, experience, financial capability and qualification for serving as
general contracto r for similar developments in the California. The Tenant shall submit for the
Landlord's reasonable approval the identity of any proposed General Contractor and such
additional information about the background, experience, and financial condition of any
proposed General Contractor as is reasonably necessary for the Landlord to determine whether
the proposed General Contractor meets the standard for a qualified General Contractor set forth
above. If the proposed General Contractor meets such standard, the Landlord shall approve or
disapprove the proposed General Contractor by notifying the Tenant in writing within thirty (30)
days of the submission. Any disapproval shall state with reasonable specificity the basis for
disapproval. As of the Effective Date, the Landlord has approved HA Builder Group, LLC as
the general contractor for the initial construction of the Improvements.
(k) Construction Contracts. The Tenant shall enter into the Construction
Contracts, which shall provide for the work to be performed for fixed and specified maximum
amounts or a llowances pursuant to the approved Construction Plans.
As of the Effective Date, the Landlord has approved the Construction Contracts
for the Improvements. Within ten (10) days following the issuance of a Building Permit, or any
Major Additional Improvements, the Tenant shall submit a copy of all Construction Contracts for
such construction to the Landlo rd, for the sole and limited purposes of determining: (a) that the
amount of the costs of work has been clearly fixed and determined and is consistent with the
amount set forth in the approved applicable budget for such work; (b) that no changes to the
provisions of the Construction Contracts which, pursuant to this Ground Lease or the
Development Documents require the approval of Landlord, shall be made without the prior
consent of the Landlord; and (c) that the Landlord is named as a specified third-party beneficiary
w ith a direct right of enforcement under such contract. Subject to Tenant's compliance with
Section 14.1 (c) hereof, unless the Landlord notifies the Tenant in writing within ten (10) days
following the submittal of the Construction Contracts that the Construction Contracts have been
disapproved, they shall be deemed approved. The Landlord's approval of the Construction
Contract, pursuant to this Section, shall in no way be deemed to constitute approval of, or
concurrence with, any other term or condition of the Construction Contract, and the Landlord's
approval shall solely constitute satisfaction of the conditions set forth in this Section 4.3. The
Tenant shall not rely on the Landlord's approval of the Construction Contract(s) as a
representation regarding the enforceability or busin ess advantage of the Construction
Contract(s).
(I) Conditions to Comme0_cement of Construction. In no event shal I the
Tenant commence any construction of the Improvements or any Major Additional Improvements
on the Property until the following conditions have been satisfied or waived by the Landlord, in
addition to other conditions and requirements imposed by this Ground Lease:
17
IO I 0\26\2824202.8
(I) The Landlord has approved the final plans and specifications for
the Improvements or the Major Additional Improvements to be constructed, it being
acknowledged by Landlord that the Constructi on Plans are hereby approved;
(2) The Tenant has obtained financing and equity capital necessary, as
applicable, for the full payment of the costs of construction of the Improvements or the Major
Additional Improvements (as applicable) and has deli vered evidence of such financing to the
Landlord;
(3) The Tenant has obtained building permits and all other
governmental approvals necessary for the construction of the Improvements, or the Major
Additional Improvements, to the extent required by applicable law;
( 4) The Tenant has entered into complete and binding Construction
Contracts with HA Builder Group, LLC or such other General Contractors for the construction of
the Improvements, or the Major Additional Improvements, which Construction Contracts shall
meet the requirements of subsection (k) above;
(5) The Tenant has obtained the performance bond and the payment
bond meeting the requirements of subsection (i) above; and
(6) There exists no continuing Tenant Event of Default under this
Ground Lease or the Development Documents.
Section 4.4 No Liens.
The Tenant shall not have any right, authority or power to bind the Landlord, or the
Landlord's fee interest in the Property, for any claim for labor or material or for any other charge
or expense, lien or security interest incurred in connection with the deve lopment, construction or
operation of the Improvements or any change, alteration or addition thereto including, but not
limited to, any Major Additional Improvements. The Tenant shall not have any right to
encumber the Tenant's estate in the Property without the written consent of the Landlord, other
than with the Approved Security Interests. Any easements necessary and incidental to the
development, construction and operation of the Improvements are subject to the approval of the
Landlord, which shall not be unreasonably withheld, delayed, or conditioned.
Section 4.5 Permits, Licenses and Easements.
At no material cost to the Landlord, the Landlord shall cooperate with the Tenant in the
submittal of applications for all required permits, licenses, applications fo r utility services and
easements, provided that the Tenant shall be responsible for obtaining any and all permits,
licenses, easements and other authorizations required by any Governmental Authorities with
respect to any construction or other work to be performed on the Property and for granting or
causing to be granted all permits, licenses, easements and other governmental authorizations that
are necessary or helpful, as determined by Tenant, for electric, telephone, gas, water, sewer,
drainage, access and such other public or private utilities or facilities as may be reasonably
18
IO I 0\26\2824202.8
necessary or desirable in connection with the construction or operation of the Improvements.
The Tenant shall be entitled, w ithout separate payment to the Landlord for tap or connection
fees, to tap into the existing lines, facilities and systems of applicable electric, gas, cable, water,
sewer, sewer treatment and other utilities serving the Property (if any), provided the Tenant
remains responsible for payment of such fees therefor.
ARTICLE 5.
USE, CHARACTER, OPERATION AND MAINTENANCE OF IMPROVEMENTS
Section 5.1 Required and Permitted Uses.
(a) Quality of Operations. The Parties recognize and acknowledge that the
manner in which the Property and the Improvements are developed, used and operated are
matters of critical concern to the Landlord by reason of the Landlord's financial assistance to the
Tenant for the Improvements. In order to give the Landlord assurance as to the manner in which
the Improvements will be used and operated, the Tenant agrees that at a ll times during the Term
of this Ground Lease, the Tenant will establish and maintain a quali ty of character and operation
of the Property and Improvements in accordance with this Ground Lease and the Development
Documents.
(b) Covenant to Provide Affordable Housing. Throughout the Term, the
Tenant shall use the Improvements solely for the purpose of providing affordable housing to
income-eligible househo lds in accordance with this Ground Lease and the Development
Documents.
(I) Effective Date through Year 57. In accordance with the
Development Documents, following the Effective Date until the fifty-seventh (57th) anniversary
of the Effective Date, the Tenant shall: (i) make available twenty-four (24) Units to households
earning no more than twenty-five percent (25%) of Area Median Income, and twe nty-six (26)
Units to households earning no more than ninety percent (90%) of Area Median Income (for the
purposes of this Section, the two (2) managers' units shall be deemed to be in compliance with
this requirement regardless of any income or rent charged to the occupants of the managers'
units); (ii) shall charge "affordabl e rent" for such Units that do not exceed thirty percent (30%) of
such household's income, adjusted based on household size appropriate for the Unit, in
accordance with California Health and Safety Code Section 50053; and (iii) shall market the
Improvements to households with a member that is a Veteran, subject to all applicable fair
housing laws and other applicable laws. So long as the City Regulatory Agreement is in effect,
the Tenant's compliance with the City Regulatory Agreement shall be deemed to be compliance
with the requirements of this subsection.
(2) Remainder of Term. Commencing on the first (1st) day of the
fifty-eighth (58th) year of the Term, the Tenant shall have the right, but not the obligation, to: (i)
make available twenty-four (24) Units to households earning no more than seventy percent
(70%) of Area Median Income; and (ii) shall charge "affordable rent" for such Units that do not
exceed thirty percent (30%) of seventy percent (70%) of Area Median Income, adjusted based on
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the household size appropriate for the Unit. Any increase of rent for the Units may only be
implemented in accordance with any applicable laws or regulations, and, to the extent applicable,
any lease requirements governing increased rents for the Units.
(3) Other Regulatory Agreements. Nothing in th is subsection shall be
deemed to waive, limit, or impair the Tenant's right to agree to more restrictive population,
income and rent limitations that: (a) may be imposed by any Regulatory Agreements; (b) are
otherwise required by any Approved Security Interest Holder; or (c) are otherwise necessary to
obtain the Tax Credit Funds.
(c) Preference. To extent consistent with all applicable fair housing laws and
other applicable laws, the Tenant shall implement a preference, in the selection of tenants, for
income-eligible households with a member that: (i) resides in the City; (ii) works in the City; or
(iii) is a Veteran. Provided, however, nothing in this Section shall be deemed to require the
Tenant to violate any applicable fair housing law(s), and other applicable laws, and the Tenant
shall have no obligation to implement such preference program unless and until the Tenant, the
City, and the County have, mutually determined, in writing, that such preference can be
implemented in accordance with all applicable federal and state fair housing laws and other
applicable laws (as amended from time to time). ln the event the Tenant, the City, and the
County determine, from time to time, that the preference cannot be implemented in a manner
consistent with applicable law, then the Tenant shall have no obligation to implement the
preference during such period, and the fai lure to implement the preference during such period
shall not constitute a Tenant Event of Default.
Section 5.2 Limitations on Use.
Tn addition to the covenants regarding the use of the Property se~ forth above, the Tenant
further agrees:
(a) Not to use or permit the use of the Property for any disorderly or unlawful
purpose;
(b) Not to cause or permit any party from committing or maintaining any
nuisance or unlawful conduct on or about the Property;
(c) Not to cause or permit any action by any party that would cause the
Tenant to materially violate any of the covenants and conditions of this Ground Lease with
respect to the lmprovements;
(d) Upon written notice from the Landlord, to take reasonable action, if
necessary, to abate any action by any party that would cause a material violation of this Ground
Lease;
(e) To permit the Landlord and its agents upon not less than forty-eight (48)
hours written notice to inspect the Property or any part thereof at any reasonable time during the
Term, subject to the rights of the tenants of the Units;
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(t) Not to cause or permit any waste in, on or about the Property;
(g) Not to cause or permit obnoxious odors to emanate or be dispelled from
the Improvements;
(h) Not to permit undue accumulations of garbage, trash, rubbish, or any othe r
refuse; and
(i) Not to use or permit the use of the Property for any purpose that violates
the terms of this Ground Lease or the Development Documents.
The Tenant shall maintain all portions of the Property in good repair and conditi on,
including, but not limited to maintaining the Deve lopment in accordance with the Development
Documents. In the event that there ari ses at any time prior to the expiration of this Ground Lease
a conditio n in contravention of these maintenance and use standards, then the Landlord shall give
written notice to the Tenant of the deficiency. If the Tenant fail s to cure the deficiency w ithin
thirty (3 0) days of the Landlord's notice (or, if the deficiency is not susceptible of cure within
such thirty (30) day period, the Tenant fails to commence the cure and thereafter to diligently
pursue the cure to completi on, in no event to exceed one hundred e ighty ( l 80) days from the date
of the Landlord's written notice), then, subject to the rights of tenants, the Landlord sha ll have
the right to enter the Property and perform all acts reasonably necessary to cure the defi ciency or
to take other recourse at law or in equity the Landlord may then have and to receive from Tenant
the Landlord's actual out-of-pocket cost in taking such action. T he Parties further mutually agree
that the rights conferred upon the Landlord expressly include the right to enforce or establish a
lien against the Property; provided, however such lien shall be subordinate to all existing liens or
encumbrances recorded against the Tenant's interest in the Property. The foregoing provisions
shall be covenants running with the land until expiration of this Ground Lease, enforceable by
the Landlord.
Section 5.3 Operation of Development.
G iven the Landlord's fi nancial contribution to the Tenant, as set forth in the City Loan
Documents, and the Rent amount set forth in this Ground Lease, the qualifications and identity
of the Management Agent are of particular concern to the community and the Landlord.
The Development shall be managed and operated by a Management Agent, reasonably
satisfactory to the Landlord, having the necessary financia l capability to operate the
Development and the reputation, experience and qualifications fo r operating similar affordable
ho using developments as set forth in the Development Documents and this Article 5. The
Tenant shall submit, in writing, for Landlord approval (in its reasonable discretion), any
proposed change to the Management Agent or any material changes to the Property Management
Agreement, as set forth in this Section. To the extent applicable, the Tenant shall also submit
such additional information about the background, experience and financial condition of any
proposed Management Agent as is reasonably requested by the Landlord to determine whether
the proposed Management Agent meets the standard for a qualified Management Agent set forth
2 1
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above. Tf the proposed Management Agent meets the standard for a quali fied Management
Agent set forth above, the Landlord shall approve the proposed Management Agent by notify ing
the Tenant in writing. Subject to Tenant's comp I iance with Section 14.1 ( c) hereof, unless the
proposed Management Agent is disapproved by the Landlord within thirty (30) days following
the Landlord's receipt of the Tenant's notice, w hich disapproval shall state with reasonable
specificity the basis for disapproval, it shall be deemed approved. If the proposed Management
Agent is disapproved by the Landlord for failing to meet the standard fo r a qualified
Management Agent set forth above, the Tenant shall submit for the Landlord's approval (in its
reasonable discretion) a new proposed Management Agent within thirty (3 0) days fo llowing the
Landlord's disapproval. The Tenant shall continue to submit proposed Management Agents for
the Landlord's approval (in its reasonable discretion) until the Landlord approves a proposed
Management Agent. Landlord hereby approves Solari Enterprises, Inc., as the initial
Management Agent.
Section 5.4 Maintenance of Improvements.
During the Term of this Ground Lease, the Tenant shall operate and mai ntain the
Improvements in an adeq uate manner to provide safe and sanitary housing to the tenants at the
Property. All Improvements repaired or replaced under this Ground Lease shall be repaired or
replaced with materials, apparatus and facil ities of a quality at least equal to the quality of the
materials, apparatus and facil ities being repaired or replaced and in accordance with Section 4.2.
The Tenant may utilize a party other than the Management Agent to provide mai ntenance
services.
Section 5.5 Cost of Operation and Maintenance of Improvements.
As between the Landlord and the Tenant, all costs incurred by Tenant in the
development, operation, and maintenance of the Improvements shall be paid by the Tenant.
Section 5.6 The Landlo rd Not Obligated to Repair.
The Landlord shall not be obligated to make any repairs, replacements or renewals of any
kind, nature or description whatsoever to the Improvements, and the Tenant hereby expressly
waives all right to make repairs at the Landlord's expense under Section 1941 and 1942 of the
California Civil Code, as either or both may from time to time be amended, replaced or restated.
Section 5.7 Non-discrimination.
(a) Non-discrimination. Except as may be permitted as set forth in Section
5.1, above, in accordance with applicable law, there shall be no discrimination against or
segregation of any person or gro up of persons on account of race, color, creed, religion, sex,
sexual orientation, age, handicap, marital status, ancestry or national origin in the sale, lease,
sublease, transfer, use, occupancy, tenure or enj oyment of the Improvements, or any part thereof,
and, except as set forth above, the Tenant or any person claiming under or through the Tenant,
shall not establish or permit any such practice or practices of d iscrimination or segregation with
reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants,
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1010\26\2824202.8
sub lessees, or vendees of the Improvements, or any part thereof.
(b) Required Provisions in Leases. Tenant shall include, and e nforce, the
fo llowing provisions in all leases executed by, or on behalf of the Tenant:
"(I) Lessee herein covenants by and fo r itself, its successors and
assigns, and all persons claiming under or through them, that there shall be no discrimination
against or segregation of, any person or group of persons on account of any basis listed in
subdivision (a) and (d) of Secti on 12955 of the Government Code, as those bases are defined in
Sections 12926, 12926.l , subdivision (m) and paragraph (I ) of subdivision (p) of Secti on 12955
and Section 12955.2 of the Government Code in the leasing, subleasing, transferring, use,
occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee or any person
claiming under or through the lessee, establish or permit any such practice or practices of
discrimination or segregation with reference to the selection, locati on, number, use or occupancy
of tenants, lessees, sub lessees, subtenants, or vendees in the premises herein leased.
(2) Notwithstanding paragraph (1 ), with respect to familial status,
paragraph ( 1) shall not be construed to apply to ho using for older persons, as defined in Section
12955.9 of the Government Code. With respect to familial status, nothing in paragraph (1) shall
be construed to affect Sections 51.2, 5 1.3, 5 1 .4, 51.10, 51.11 , and 799.5 of the Civil Code,
relating to housing for senior citizens. Subdivision ( d) of Section 5 1 and Section 1360 of the
Civil Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Code shall
apply to paragraph ( 1 ). "
(c) Required Provisions in Contracts. Tenant shall include, and enforce, the
fo llowing provisions in all contracts executed by, or on behalf of the Tenant:
"( 1) There shall be no discrimination against or segregation of, any
person or group of persons on account of any basis listed in subdivision (a) and (d) of Section
12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1,
subdivis ion (m) and paragraph (l) of subdivision (p) of Section 12955 and Section 12955.2 of
the Government Code in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment
of the property nor shall the transferee or any person claiming under or through the transferee
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, subtenants, sub lessees or
vendees of the land.
(2) Notwithstanding paragraph (l), with respect to familial status,
paragraph (I) shall not be construed to apply to ho using for older persons, as defined in Section
12955.9 of the Government Code. With respect to familial status, nothing in paragraph (1) shall
be construed to affect Sections 5 1.2, 5 1.3, 5 1.4, 51.10, 5 1.11, and 799.5 of the Civi l Code,
relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1360 of the
Civil Code and subdiv isions (n), (o), and (p) of Section 12955 of the Government Code shall
apply to paragraph (1)."
Section 5.8 Compliance with Laws.
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The Tenant shall, at Tenant's sole cost and expense, comply with all applicable federal,
state, County, municipal and other governmental statutes, laws, rules, orders, regulations and
ordinances affecting the Improvements the use thereof, or construction thereon, including those
which require the making of any structural, unforeseen or extraordinary changes, whether or not
any such statutes, laws, rules, orders, regulations or ordinances which may be hereafter enacted
were with in the contemplation of the Parties at the time of execution of this Ground Lease, or
involve a change of policy on the part of the Governmental Authority enacting the same. The
Tenant shall comply with each and every requirement of all policies of public liability, fire and
other insurance which at any time may be in force with respect to the Improvements.
Section 5.9 Property Taxes.
The Tenant acknowledges and agrees that this Ground Lease will create a possessory
interest subject to property taxation. Subject to the Tenant's ri ghts of contest as provided in
Section 5.16, the Tenant agrees to pay and discharge, or cause the payment and discharge, during
the Term of the Ground Lease, before delinquency, all taxes (including, without limitation,
possessory interest taxes associated with the Tenant's interest in the Property, the Ground Lease,
and any so-called value added tax), assessments (including without limitation, all assessments for
pub I ic improvements or benefits, whether or not to be completed prior to the date hereof and
whether or not to be completed within the Term if the Ground Lease), fees, levies, water and
sewer rents, rates and charges, vault license fees or rentals, license and permit fees and other
governmental charges of any kind or nature whatsoever, general and special, ordinary and
extraordinary, foreseen, currently or hereafter levied or assessed in lieu of or in substitution of
any of the foregoing which are or may be at any time or from time to time during the Term of the
Ground Lease levied, charged, assessed or imposed upon or against the Tenant's interest in the
Property or the Improvements which are located thereon, or against any of the Tenant's personal
property located thereon, or which may be levied, charged, assessed or imposed upon or against
the leasehold estate created hereby or which may be imposed upon any taxable interest of the
Tenant acquired pursuant to the Ground Lease (all of the foregoing collectively called "Taxes").
The Tenant shall pay or reimburse the Landlord, as the case may be, fo r any fines, penalties,
interest or costs which may be added by the collecting authority for the late payment or
nonpayment of any Taxes required to be paid by the Tenant hereunder. Tenant shall use good
faith efforts to apply for and maintain a welfare exemption in accordance with Section 2 14(g)
and Section 236 of the California Revenue and Taxation Code.
Section 5.10 Limits of I~x Liability.
The provisions of this Ground Lease shall not be deemed to require the Tenant to pay
municipal, County, state or federal income or gross receipts taxes (except as provided below) or
excess profits taxes assessed against the Landlord or any interest of Landlord in the Property or
Improveme nts, or municipal, County, state or federal capital levy, estate, succession, inheritance,
gift or transfer taxes of the Landlord, or corporation franchise taxes imposed upon any corporate
owner of the fee of the Property; except, however, that the Tenant shall pay all taxes assessed by
any Governmental Authorities by virtue of any operations by the Tenant conducted on or out of
the Improvements.
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Section 5.11 Apportionment of Taxes.
A ll Taxes for the fiscal or tax years in which the Term begins and ends shall be
apportioned so that the Tenant shall pay only those portions thereof that wi II correspond with the
portion of said years as are within the Term.
Section 5.1 2 Tax Recei.P,ts.
The Tenant, upon the written request of the Landlord, shall furnish to the Landlord within
thirty (30) days after the date when any such Taxes would become delinquent, other evidence
reasonably satisfactory to the Landlord evidencing the payment of such Taxes.
Section 5.13 Evidence ofNon.Pfil'._ment.
The receipt by the Landlord of a certifi cate, advice, receipt or bill of the appropriate
official designated by law to make or issue the same or to receive payment of any such Taxes,
stating the nonpayment of such Taxes prior to delinquency shall be prima facie evidence that
such Taxes are due and unpaid or have not been paid at the time of the making or issuance of
such certificate, advice, receipt or bill.
Section 5.14 Assistance in Makin~ments.
The Parties acknowledge that Tenant is responsible under this Ground Lease for making
various payments to third parties, such as tax and utility payments in accordance with the
provisions of this Article 5. In case any person or entity to whom any sum is directly payable by
the Tenant under any of the provisions of this Ground Lease (e.g., a tax collector or utility
company) shall refu se to accept payment of such sum from the Tenant (due to the fact that the
Tenant is not the fee owner of the Property or for any other reason), the Tenant shall thereupon
give written notice of such fact to the Landlord and shall pay such sum directly to Landlord at
the address specified in Section 14.1 hereof, and Landlord shal I thereupon pay such sum to such
person or entity.
Section 5.15 The Landlord's Right Cure.
If the Tenant, in violation of the provisions of this Ground Lease, shall fa il to pay and to
d ischarge any Taxes, or any other tax or fee, the Landlord may (but shall not be obligated to) pay
or discharge such Taxes, and the amount paid by the Landlord and the amount of all costs,
expens·es, interest and penalties connected therewith, including attorneys' fees, together with
interest at the Default Jnterest Rate shall be deemed to be and shall, upon demand of the
Landlord, be payable by the Tenant as repayment of an Advance.
Section 5.16 Permitted Contests.
The Tenant shall not be required to pay, discharge or remove any Taxes (including
penalties and interest) upon or against the Improvements, or any part thereof, so long as the
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Tenant shall in good faith contest the same or the validity thereof by appropriate legal
proceedings and such legal proceedings shall operate to prevent the collection of the taxes so
contested, or the sale of the Improvements, or any part thereof, to satisfy the same; and the
Tenant shall, prior to the date such taxes are due and payable, meet all requirements for contest
im posed by the taxing entity whose Tax is being contested (including, without limitation,
depositing any sums required by such taxin g entity). In the event the final determination of any
such contest is adverse to the Tenant, the Tenant shall promptly pay fully and discharge the
amounts involved in or affected by such contest, together with any penalties, fines, interest, costs
and expenses that may have accrued thereon or that may result from any such contest by the
Tenant. Any proceedings to contest the validity or amount of taxes or to recover back any taxes
pa id by the Tenant shal I be brought by the Tenant, at the Tenant's sole expense, in the name of
the Tenant. If any such proceedings are brought by the Tenant, the Tenant shall indemnify and
hold harmless the Landlord against any and all loss, cost or expense of any kind (including, but
not limited to, reasonable attorneys' fees and expenses) which may be imposed upon or incurred
by the Landlord in connection with those proceedings except to the extent arising from the
Landlord's gross negligence, willful misconduct, illegal acts or breach of this Ground Lease.
The Landlord shall cooperate with the Tenant in providing the Tenant information in
connection with contests permitted under this Section.
Section 5.17 Service and Utilities.
The Tenant shall pay promptly as the same become due and payable al I charges, costs,
bills and expenses of and for water, gas, electricity, sewer, air-conditioning, telephone and all
other public or private services and utiliti es of whatever kind furnished or supplied to or used by
the Tenant or any other party in connection with the use, occupancy, maintenance or operation of
the Improvements or any part thereof, and shall comply with all contracts relating to such
services and shall do all other things reasonably necessary and required for the maintenance and
continuance of such services.
Section 5. I 8 Hazardous Materi~h-
(a) Covenants.
(I) No Hazardous Materials Activities. The Tenant hereby represents
and warrants to the Landlord that, at all times from and after the Effective Date, the Tenant shal l
not cause or permit the Property or the Improvements thereon to be used as a site for the use,
generation, manufacture, storage, treatment, release, discharge, disposal, transportation or
presence of any Hazardous Materials.
(2) Hazardous Materials Laws. The Tenant hereby represents and
warrants to the Landlord that, at all times from and after the Effective Date, the Tenant shall
comply and cause the Property and the Improvements thereon to comply with all Hazardous
Materials Laws, including without limitation, those relating to soil and groundwater condition s.
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(3) Notices. The Tenant hereby represents and warrants to the
Landlord that, at all times from and after the Effecti ve Date, the Tenant shall immediately notify
the Landlord in writing of: (i) the discovery of any Hazardous Materials on or under the
Property in violation of Hazardous Materials Laws; (ii) any knowledge by Tenant that the
Property does not comply with any Hazardous Materials Laws; (iii) any claims o r actions
pending, for which Tenant has been served, or threatened in writing against the Tenant, the
Property or the improvements thereon by any Governmental Authorities or any other person or
entity relating to Hazardous Materials or pursuant to any Hazardous Materials Laws (collectively
"Hazardous Materials Claim s"); and (iv) the discovery of any occurrence or condition on any
real property adjoining or in the vicinity of the Property that could cause the Property or any part
thereof to be subject to any restrictions on the ownership, occupancy, transferability or use of the
Property under any Hazardous Materials Law, including without limitation under the provisions
of Califo rnia Health and Safety Code, Sections 25220 et seq., or any regulation adopted in
accordance therewith.
(4) Remedial Action. In response to the presence of any Hazardous
Materials on, under or about the Property in violation of Hazardous Materials Laws during the
Term, the Tenant shall immediately take, at Tenant's sole expense, all remedi al action required
by any Hazardous Materials Laws or any judgment, consent decree, settleme nt or compromise
with respect to any Hazardous Materials Claims.
(b) Inspection by Landlord. Upon reasonable prior written notice to the
Tenant, and subject to the rights of tenants at the Property, the Landlord, its employees and
agents, may from time to time enter and inspect the Pro perty fo r the purpose of determini ng the
existence, location, nature and magnitude of any past or present release or threatened release of
any Hazardous Materials into, onto, beneath or fro m the Property.
(c) Environmental Indemn ity. Without limiting the generality of the
indemnity set fo11h elsewhere in this Ground Lease, the Tenant shall defend, indemnify, and hold
the Landlord and its councilmembers, commissioners, directors, officers, employees, agents,
successors, and assigns (for the purpose of this clause (c), the "Indemnified Parties") free and
harmless against any claims, loss, damage, costs, expense or liability they may actually incur
directly arising out of or attributable to the use, generation, storage, release, threatened release,
discharge, or disposal by the Tenant or its contractors, subcontractors, tenants, agents, and
employees, of Hazardous Materials on, under, or about the Property or the Improvements in
violatio n of Hazardous Materials Laws (except to the extent caused by any act or omission of the
Landlord or its agents), including without lim itation: (I) a ll fo reseeable consequential damages
but solely to the extent owing by the Indemnified Parties to third parties; (2) the costs of any
required or necessary repair, cleanup or detoxification of the Property or the Improvements, and
the preparation and implementation of any c losure, remedial or other required plans; and (3) all
reasonable out-of-pocket costs and expenses actually incurred by the Landlord in connection
with clauses (I) and (2), including but not lim ited to reasonable attorney's fees. Notwithstanding
the foregoing, Tenant shall have no liability for any such claims, loss, damage, costs, expense or
liability imposed upon or incurred by or asserted against any Indemnified Parties to the extent
arising from the gross negligence, willful misconduct, ill egal acts or breach of this Ground Lease
by any Indemnified Party or to the extent arising from acti ons, conditions or events relating to
27
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Hazardous Materials placed in, on, above or under the Property after the expiration of the Term
of this Ground Lease (or the earlier termination thereof) and were not caused by the direct or
indirect actions of Tenant or any party acting, by, under, or through Tenant. This obligation to
indemnify and defend shall survive termination of this Ground Lease.
ARTICLE 6.
TIJLE TO IMPROVEMENTS; QUIET ENJOYMENT; INSPECTJONS.
Section 6.1 During the T~rm.
The Landlord hereby grants to the Tenant, without warranty express or implied, any right,
title, or interest that the Landlord has or may have in the improvements now or hereafter located
on the Property, which improvements are and shall at all times during the Term be deemed real
property. Notwithstanding any provision in this Ground Lease to the contrary, the Improvements
and all alterations, additions, equipment and fixtures built, made or installed by the Tenant in, on,
under or to the Property or the Improvements shall be the sole property of the Tenant until the
expiration of the Term or other termination of this Ground Lease; provided, however, that the
Tenant shall have no right to destroy, demolish or remove the Improvements, or any portion
thereof, except as specifically provided for in this Ground Lease or as approved in writing by the
Landlord. It is the intent of the Parties hereto that this Ground Lease shall create a constructive
notice of severance of the Improvements from the Property without the necessity of a deed from
the Landlord after the [mprovements have been constructed.
Section 6.2 After the Term.
Upon the expiration of the Term or other termination of the Ground Lease, the
lmprovements and all alterations, additions, equipment and fixtures shall be deemed to be and
shall automatically become the property of the Landlord, without cost or charge to the Landlord.
The Landlord agrees that the Tenant, at any time prior to the si-xtieth (60th) day after the
expiration or other termination of this Ground Lease, may remove from the Property, the
Personal Property, and any and all equipment which the Tenant has furnished for maintenance
purposes, provided that the Tenant shall repair any physical damage to the Property or the
Improvements caused by the removal of such equipment and property. The Tenant agrees to
execute, at the request of the Landlord at the end of the Term, a quitclaim deed of the
Improvements to the Landlord to be recorded at the Landlord's option and expense and any other
documents that may be reasonably required by the Landlord or the Landlord's title company to
provide the Landlord title to the Property and the Improvements free and clear of all monetary
liens and monetary encumbrances not caused or agreed to by the Landlord.
Section 6.3 Benefits of Improvements During Term.
The Landlord acknowledges and agrees that any and all depreciation, amortization, tax
credits and other tax benefits for federal or state tax purposes re lating to the Improvements
located o n the Property and any and all additions thereto, substitutions therefor, fixtures therein
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and other property relating thereto shall be deducted or credited exclusively to the Tenant during
the Term and for the tax years during which the Tenn begins and ends.
Section 6.4 Quiet Enjoyment.
The Landlord covenants and warrants that the Tenant shall peaceably and quietly have,
hold, occupy, use and enjoy, and shall have the full, exclusive and unrestricted use and
enjoyment of, all of the Property during the Term, subject only to the provisions of this Ground
Lease and all applicable legal requirements of the Governmental Authorities.
Section 6.5 The Landlord's Right of inspection.
Notwithstanding Section 6.4 above, the Landlord, its employees or its agents, upon at
least forty-eight (48) hours prior written notice to the Tenant, shall have the right to enter upon
the Property for purposes of reasonable inspections performed during reasonable business hours
in order to assure compliance by the Tenant with its obligations under this Ground Lease, subject
to the rights of the tenants of the Units.
ARTrCLE 7.
ASSIGNMENT AND SUBLETTING
Section 7.1 Definitions.
(a) Definition. For purposes of this Ground Lease, "Transfer" shall mean any
sale, assignment, or transfer, whether voluntary or involuntary, of: (i) any rights and/or duties
under this Lease; and/or (ii) any interest in the Tenant or the Development, including (but not
limited to) a fee simple interest, a joint tenancy interest, a life estate, a partnership interest, a
leasehold interest, a security interest, or an interest evidenced by a land contract by which
possession of the Development is transferred and Tenant retains title. The term "Transfer" shall
exclude the l'easing of any single Unit in the Development to an occupant in compliance with the
Regulatory Agreement.
(b) Prohibited Transfers. Other than the Permitted Transfers (as set forth in
Section 7.3, below), no Transfer shall be permitted without the prior written consent of the City,
which the City may withhold in its reasonable discretion_. Any unauthorized Transfer shall
constitute a Tenant Event of Default under Section 12. L, below.
Section 7.2 Purpose of Restrictions on Transfer; Applicability.
This Ground Lease is granted to the Tenant solely for the purpose of development and
operation of the Improvements, and its subsequent use in accordance with the terms of this
Ground Lease, and not for speculation in landholding. The Tenant recognizes that, in view of
the following factors, the qualifications and identity of the Tenant are of particular concern to the
community and Landlord:
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(a) The fact that a Transfer as defined in Section 7. l above is for practical
purposes a transfer or disposition of the leasehold interest in the Property then owned by Tenant;
and
(b) The fact that the Improvements are not to be acquired, developed or used
for speculation, but only for development and operation by Tenant in accordance with this
Ground Lease and the Development Documents.
Tenant further recognizes that it is because of such qua I ifications and identity that
Landlord is entering into this Ground Lease with Tenant and that Transfers are permitted only as
provided in this Ground Lease.
Section 7.3 Prohibited Transfers.
Except as expressly permitted in this Ground Lease, Tenant represents and agrees that
Tenant has not f!lade or created, and shall not make or create or suffer to be made or created, any
Transfer, either voluntarily or by operation of law.
Any Transfer made in contravention of this Section 7.3 shall be void and shall be deemed
to be a default under this Ground Lease whether or not Tenant knew of or participated in such
Transfer.
Section 7.4 Permitted Transfers.
Notwithstanding the provisions of Section 7.3, the following Transfers shall be permitted
and approved by Landlord:
(a) Any Transfer to an Approved Security Interest Holder pursuant to an
Approved Security Interest (as set forth in Article 9);
(b) Any Transfer directly resulting from the foreclosure of an Approved
Security Interest, the granting of a deed in lieu of foreclosure of an Approved Security Interest,
or as otherwise permitted under Article 9 below;
(c) Any Transfer solely and directly resulting from the death or incapacity of
an individual;
(d) Future Transfers of the limited partner interest of Tenant provided that:
(I) such Transfers do not affect the timing and amount of the investor capital contributions
provided for in, and subject to the terms, conditions, and adjustments of the Partnership
Agreement; and (2) in subsequent Transfers prior to the investment of all project equity by the
Investor, such Transfer is to a Related Entity investor Transferee.
( e) Transfer of the Tenant's leasehold interest Property from the Tenant to: (I)
the Managing General Partner, an entity under the Control of the Managing General Partner, or
30
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(2) the Administrative General Partner, an entity under the Control of the Administrative General
Partner (or Affirmed), and an assumption of the City Loan by such transferee at the end of the
Fifteen Year Compliance Period, or as otherwise permitted by the Jnvestor, pursuant to an option
or right of first refusal agreement as described in the Partnership Agreement, or related
documents; provided that: (A) if such transferee is the Managing General Partner or an entity
under the Control of the Managing General Partner, the transferee is exempt from federal income
taxation pursuant to Section 50 I ( c )(3) of the Code, (B) the transferee is under the Control of the
Managing General Partner, an entity under the Control of the Managing General Partner, the
Administrative General Partner, an entity under the Control of the Administrative General
Partner (or Affirmed) and (C) the transferee expressly assumes the obligations of the Tenant
under this Lease and the obligations under the City Loan Documents, utilizing a form of
assignment and assumption agreement to be provided by the City, and approved by the
transferee.
(f) Transfers of any interest in the Tenant from: (i) the Limited Partner to the
Administrative General Partner or an affiliate of the Administrative General Partner (or
Affirmed), (ii) the Administrative General Partner to any affiliate of the Administrative General
Partner (or Affirmed), and (iii) the Manag ing General Partner to another corporation that is
exempt from federal income taxation pursuant to Section 501(c)(3) of the Code, and that is
reasonably acceptable to the City.
(g) In the event the Managing Genera l Partner or the Administrative General
Partner is removed by a limited partner of Tenant for cause fol lowing default under the
Partnership Agreement, the C ity hereby approves the Transfer of the general partner interest to:
(1) a corporation exempt from federal income tax pursuant to Section 501 ( c )(3) of the Code, or a
limited liability company whose member is a corporation exempt from federal income tax under
Section 501 ( c )(3) of the Code, selected by the I irnited partner and approved by the City, which
approval shall not be withheld unreasonably; or (2) the Investor Limited Partner, the Special
Limited Partner, or a Related Entity Investor Transferee, but only for a period not to exceed one
hundred eighty (180) days during which time such entity shall dili gently seek a replacement
general partner meeting the requirements of subsection (I) above, or otherwise acceptable to the
Investor Limited Partner, the Special Limited Partner, and the City (such approval not to be
unreasonably withheld, delayed, or conditioned); and
(h) The lease of the Units within to income-eligible households in accordance
with this Ground Lease and the Development Docume nts.
Section 7.5 Procedure for Landlord Approval of Certain Transfers.
In the event the Tenant desires to effect a Transfer that is not permitted hereunder, the
Tenant shall first submit to Landlord information regarding such proposed Transfer including the
proposed documents to effectuate the Transfer, a description of the type and amount of
consideration for the Transfer, and information regarding the proposed transferee's financial
strength and the proposed transferee's capacities and expertise with respect to operatio n and
management of similar mixed-use developments. T he Landlord shall approve such Transfer by
written notice to the Tenant if, based upon the information submitted by the Tenant and any
3 1
1010\26\2824202.8
other information available to the Landlord, it appears that following the Transfer, the new
Tenant will be of sound reputation and will have sufficient financial strength and management
and operation expertise in the ownership and operation of affordable housing developments, to
fully perform and comply with all terms of this Ground Lease, and if, in addition, the proposed
transferee meets the following criteria:
(a) The proposed transferee has continuously been in the business of owning
and operating affordable housing developments for at least five (5) years prior to the proposed
Transfer;
(b) As of the date of the proposed Transfer, the proposed transferee has a net
worth equal to or greater than that of the Tenant as of the Effective Date or as of the proposed
Transfer, whichever is greater.
Subject to Tenant's compliance with Section 14.1 ( c) hereof, unless the proposed Transfer
is disapproved by Landlord within thirty (30) days, which disapproval shall state with reasonable
specificity the basis for disapproval, it shall be deemed approved.
Section 7 .6 Effectuation of Certain Perm itteci Transfers.
No Transfer of this Ground Lease (as opposed to a Transfer in whole or in pait of an
interest in the Tenant) permitted pursuant to Section 7.4 (other than a Transfer pursuant to an
Approved Security Interest under Section 9.1 or the lease of the Units to income-eligible
households in accordance with this Ground Lease and the Development Documents) shall be
effective unless, at the time of the Transfer, the person or entity to whom such Transfer is made,
by an instrument in writing reasonably satisfactory to Landlord and in form recordable among
the land records, shall expressly assume all of the obligations of the Tenant under this Ground
Lease and the Development Documents and agrees to be subject to all conditions and restrictions
to which the Tenant is subject arising during such person's or entity's ownership of this Ground
Lease. Anything to the contrary notwithstanding, an Approved Security Interest Holder or any
owner of the estate created by this Ground Lease whose interest shall have been acquired by,
through or under an Approved Security Interest, or shall have been derived immediately from an
Approved Security Interest Holder, shall not be required to give to Landlord such written
assumption until such holder or other person is entitled to possession of the Property or the
Improvements thereon, or entitled to possession thereof.
Section 7.7 Transfer by Landlmd.
In the event of a sale, assignment, transfer or conveyance by the Landlord of the fee
interest in the Property or of the Landlord's ri ghts under this Ground Lease, the Landlord shall be
released from any future liability upon any of the covenants or conditions of this Ground Lease,
expressed or implied, in favor of the Tenant, and, in such event, the Tenant agrees to look solely
to the successor in interest of the Landlord in and to the Property or this Ground Lease. This
Ground Lease shall not be affected by any such sale, and the Tenant agrees to attorn to any such
purchaser or assignee.
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Section 7.8 Successors and Assigns.
The terms, covenants and conditions contained in this Article 7 shall be binding upon and
inure to the benefit of the heirs, successors, executors, administrators and assigns of the Parties
hereto; provided, however, that there shall be no transfer of any interest owned by the Tenant except
pursuant to the terms of this Ground Lease.
ARTICLE 8.
fNSURANCE; DAMAGE AND DESTRUCTION OF IMPROVEMENTS
Section 8.1 Insurance Requirements.
During the Term and any Holding Over Period, the Tenant sha ll furnish to the Landlord
the type and amounts of insurance specified in Exhibit D. The Tenant shall submit to Landlord
evidence of the insurance coverage meeting the general requirements set forth in Exhibit D, on,
or before, the Effective Date, provided any evidence of insurance required for construction
purposes sh al I be submitted ten ( I 0) days prio r to commencement of any construction work on
the Property. The Landlord shall review and reasonably approve or disapprove of the evidence
of insurance not less than ten ( I 0) days after submission of complete information in the form
required by the Landlord. If the Landlord disapproves the evidence of insurance, it sha ll specify
in writing the reasons for such disapproval. The Tenant shall resubmit the informati on required
within fifteen ( 15) days of the Tenant's receipt of the Landlord's written notification. The review
and submission periods shall continue to apply until the Landlord approves the evidence of
insurance coverage. Notwithstanding any provision to the contrary, this Ground Lease shall not
commence prior to Landlord's approval of Tenant's insurance and no work shall be initiated on
the Property prior to receipt of the Landlord's approval of Tenant's insurance relating to
construction. The Landlord shall not unreasonably withhold, delay or condition approval of any
insurance.
Each contractor, and sub-contractor shall have furnished the Landlord with evidence of
the insurance coverage meeting the general insurance requirements set forth in Exhibit D, prior
to initiating any work on the Property. The periods for submission, review and approval shall
apply as stated above.
Section 8.2 No Termination of Ground Lease; Obli gation to Restore.
Except as otherwise provided in Section 8.3 or 8.4, no loss or damage by fire or any other
cause resulting in either partial or total destruction of any buildings or the Improvements now or
hereafter located in, upon or on the Property, or any fi xtures, equipment or machinery used or
intended to be used in connection with the Improvements shall operate to term inate this Ground
Lease, or to relieve or discharge the Tenant from the pay ment of any Rent or other amounts
payable under this Ground Lease, as Rent or otherwise, as and when they become due and
payable, or from the performance and observance of any of the agreements, covenants a nd
conditions herein contained to be performed and observed by the Tenant. The Tenant hereby
waives the provisions of Section 1932, subsection 2, and of Section 1933, subsection 4, of the
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California Civil Code, as either or both may from time to time be amended, replaced or restated.
Except as provided in Section 8.3 and 8.4, the Tenant shall promptly repair, or cause the prompt
repair of, any damage or destruction caused to the Improvements and restore the Improvements
to at least as good a condition as existed prior to the damage or destructi on, as more specifically
provided in Section 8.5. The Tenant's fa ilure to make such full repair and restoration under any
conditions in which it has elected or is required so to do shall constitute a Tenant Event of
Default under this Ground Lease.
Section 8.3 Damage or Destruction Occurring Prior to Final Years of Term.
The following provisions shall apply in cases of damage or destruction not descri bed in
Section 8.4:
(a) If the Improvements on the Property are damaged or destroyed by any
casualty where (I) the casualty causing such damage or destruction is required to be insured
again st under the terms of this Ground Lease, and (2) the insurance proceeds available are in an
amount of not less than one hundred percent ( I 00%) of the amoun t necessary to repair and
restore such Improvements, then the Tenant shall make full repair of such damage and shall
restore the Im provements in accordance with the provisio ns of Sections 8.2 and 8.5.
(b) If the Jmprovements on the Property are damaged or destroyed by any
casualty where (1) the casualty causing such damage or destruction is required to be insured
against under the terms of this Ground Lease, (2) the Tenant is not in default with respect to its
obligation under this Ground Lease to maintain insurance against the casualty causing such
damage or destruction, and (3) the insurance proceeds available a re in an amount that is less than
one hundred percent (100%) of the amount necessary to repair and restore such Improvements,
then the Tenant shall have the right, at the Tenant's election, to (1) terminate this Ground Lease
in accordance with the provisions of Section 8.6, or (2) make ful I repair of such damage and to
restore the Improvements in accordance with the provisions of Sections 8.2 and 8.5, or (3) repair
such damage or restore the Improvements to the extent necessary to preserve them and make
them safe, and in addition, to the extent of the insurance proceeds available.
(c) If the Improvements on the Property are damaged or destroyed by any
casualty where (1) the casualty causing such damage or destruction is required to be insured
against under the terms of th is Ground Lease, and (2) the Tenant is in default with respect to its
obligation under this Ground Lease to maintain insurance against the casualty causing such
damage or destruction, then the Tenant shall make full repair of such damage and shall restore
the Improvements in accordance with the provisions of Section 8.2 and 8.5.
(d) lf the Improvements on the Property are damaged or destroyed by any
casualty where the casualty causing such damage or destruction is not required to be insured
against under the terms of this Ground Lease, then the Tenant shall have the right, at the Tenant's
election (upon obtaining the written consent of the Investor and the Approved Security Interest
Holder(s)), to (I) term inate this Ground Lease in accordance with the provisions of Section 8.6,
or (2) make fu ll repair of such damage and to restore the Improvements in accordance with the
provisions of Section 8.2 and 8.5, or (3) repair such damage or restore the Im provements to the
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extent necessary to preserve them and make them safe, and in addition, to the extent of the
insurance proceeds available.
Section 8.4 Damage or Destruction During FinaLYears of Term.
In the event of major damage or destruction to the Improvements (as defined below) on
the Property during the last five (5) years of the Term (as may be extended), the Tenant shall
have the right, at the Tenant's election, to either make full repair of such damage and fully restore
the Improvements on the Property in accordance w ith the provisions of Sections 8.2 and 8.5 or to
terminate this Ground Lease, but subject to the rights of Approved Security Interest Holders, and
provided that if the Tenant elects to terminate this Ground Lease, the Tenant shall comply with
all of the following conditions:
(a) The Tenant shall give the Landlord written notice of th e damage or
destruction within ten (l 0) days after the event causing such damage or destruction;
(b) There shall not then exist a Tenant Event of Default;
(c) As promptly as is feasible, the Tenant shall repair or restore the damaged
Improvements to the extent necessary to preserve them and make them safe from immediate
danger to the public; and
(d) The Tenant shall deliver possession of the Property and the Improvements
thereon to the Landlord and shall quitclaim to the Landlord all right, title and interest in the
Property and the Improvements thereon.
"Maj or damage or destruction to the Improvements on the Property" (as used in this
Section) means damage or destruction where the cost to make full repair of such damage and
restore the Improvements in accordance with the provisions of Sections 8.2 and 8.5 would be
fifty percent (50%) or more of the replacement cost of all of the Improvements on the Property in
their entirety. The calculation of such percentage shall be based upon the replacement cost of the
Improvements on the Property as of the date of the damage or destruction. The determination of
whether any particular damage or destruction constitutes major damage or destruction within the
meaning of this paragraph shall be determined and certified by a professional cost estimator
experienced in such matters and mutually designated by the Landlord and the Tenant within
forty-five (45) days of the occwTence of such damage or destruction. If the Parties are unable to
designate a mutually acceptable cost estimator within such period, either Party may apply to the
presiding judge of the Superior Court of the County who shall appoint such cost estimator.
Section 8.5 Procedure for Repair and Restorati on.
The provisions of this Section shall apply whenever the Improvements on the Property
are to be repaired or restored unde r the provisions of this Article. Notwithstanding any provision
to the contrary, the Approved Security Interest Holder(s) shall have the right to participate in
adjustment of losses as to any casualty or hazard insurance proceeds as set forth in this Article 8.
35
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(a) ln the event of any damage or destruction to the Property or the
Improvements where the cost to repair exceeds Twenty Five Thousand Dollars ($25,000) (as
increased by 3.5% for each successive year of the Term), the Tenant shall promptly give the
Landlord written notice of such damage or destruction, setting forth the cause (if known), the
date on which such damage or destruction occurred, and the estimated cost of repair and
restoration as certified by a professional cost estimator experienced in such matters. Whenever
any part of the Property or the Improvements shall have been damaged or destroyed, the Tenant
shall promptly make proof of loss and shal I proceed promptly to collect, or cause to be collected,
all valid c laims which the Tenant may have against insurers or others based upon any such
damage or destruction. Except as otherwise provided below, sums of money received as
payments for any losses pursuant to said insurance policies shall be used and expended for the
purpose of fully repairing or reconstructing the portions of the Property or the Improvements
which have been destroyed or damaged in accordance with one of the fo llowing procedures:
(1) ln accordance with the procedures for use and expenditure of
insurance proceeds established by one or more Approved Security interest Holde rs if there is an
Approved Security Interest Holder(s) and such Approved Security Interest Holder(s) has
established such procedures as of the time of receipt of the insurance process (in such case, the
procedures in subsections (b) and (c) below shall not apply); or
(2) Otherwise, in accordance with the procedures of subsections (b)
and (c) below, unless the Tenant has established alternate procedures that, in the Landlord's
reasonable judgment, will accomplish the use and expenditure of the insurance proceeds to
effectuate full repair or reconstruction of the portions of the Property or the fmprovements which
have been destroyed or damaged in a more effective manner than the procedures set forth in
subsections (b) and (c).
The provisions of subsection (d) below shall apply regardless of the procedure employed
for the use and expenditure of insurance proceeds.
(b) Within one hundred eighty ( I 80) days after the event of damage or
destruction, the Tenant shall make available to the Insurance Trustee, described in subsection (c)
below, the difference, if any, between the certified estimated cost of repair and restoration and
the amount of insurance proceeds anticipated to be received for such repair and restoration (such
amount is hereinafter referred to as the "Tenant Contribution").
(c) All proceeds of insurance together with the Tenant Contribution, if any,
shall be paid by the Tenant to the insurance trustee, which insurance trustee shall be a
commercial bank or trust company experienced in such matters and designated by the Landlord
(the "Insurance Trustee"). The Insurance Trustee shall hold such proceeds in trust and shall
disburse same to the Tenant as follows: from time to ti me as the work of restoration progresses,
the Tenant shall submit to the Insurance Trustee a certificate of the Tenant, signed by an
authorized officer or representative thereof, and approved by an archi tect selected by the Tenant
and approved by the Landlord (in Landlord's reasonable discretion) (the "Architect"), which
certificate shall:
36
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(I) accurately describe the work for which the Tenant is requesting
payment and the cost incurred by the Tenant in connection therewith,
(2) certify that the Tenant has not theretofore received payment for
such work, and
(3) conditional lien releases based upon payment executed by all
persons or entities supplying labor or materials in connection with such work; and
( 4) contain or be accompanied by a statement by the Tenant that the
work for wh ich the Tenant is requesting payment has been perfonned substantia lly in accordance
with plans and specifications therefor approved by the Landlord (in Landlord's reasonable
discretion).
Within five (5) days after receipt of any such certificate, the Insurance Trustee shall pay
to the Tenant, from the funds within its possession, an amount equal to ninety percent (90%) of
the amount of the cost of the work for which the Tenant is requesting payment, as shown on such
certificate. Upon completion of such work, the remainder of such cost (to the extent of the
balance of the funds held by the Insurance Trustee) and all other insurance proceeds held by the
Insurance Trustee shall be paid to the Tenant within five (5) days after the delivery to the
Insurance Trustee of a certificate of the Tenant, signed by an authorized officer or representative
thereof and approved by the Architect for the work, stating that the work has been completed and
setting forth the total cost thereof, which certificate shall: ( I) contain or be accompanied by a
statement by the Tenant that the work has been completed substantially in accordance with plans
and specifications therefor approved by the Landlord (in Landlord's reasonable discretion); and
(2) be accompanied by either (A) an unconditional waiver or release of mechanics' and
materialmen's liens executed by all persons or entities supplying labor or materials in connection
with such work or (B) other evidence reasonably satisfactory to the Landlord that the period for
filing any such lien has expired and no such lien has been filed, or, if filed, has been bonded by
the Tenant to the reasonable satisfaction of the Landlord and the Insurance Trustee. The
Insurance Trustee shall not be required to invest or pay interest on any funds held by such
tru~tee, except in accordance with any agreement between the Tenant and the Insurance Trustee.
(d) The Tenant shall promptly commence and complete, in a good and
workmanlike manner and in accordance with Article 4, the reconstruction or repair of any part of
the Property or the Improvements thereon damaged or destroyed after (I) the Landlord has
approved (in Landlord's reasonable discretion) the Tenant's plans, drawings, specifications and
construction schedule for such reconstruction or repair as such approval may be required under
Article 4, and (2) the proceeds of insurance, if any, applicable to such reconstruction or repair
have been made available for such purpose.
Section 8.6 Procedures Upon Permitted TerminatiQn.
Upon termination of this Ground Lease pursuant to Section 8.3 or 8.4, insurance proceeds
for the Improvements not used in repair or restoration shall be distributed as follows:
37
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(a) First, to the Approved Security Interest Holder(s), the amount required by
such Approved Security fnterest Holder(s).
(b) Second, at the option of the Landlord, to the Landlord in the amount
necessary to raze the remaining Improvements, clear the Property, make it safe, and return the
Property to the condition of a developable pad.
(c) Third, any balance shall be divided between the Landlord and the Tenant
on the following basis: Proceeds for Improvements having a remaining useful life less than the
remaining Term as of the termination date shal I be paid to the Tenant. A proportionate share of
proceeds for the Improvements having a remaining useful life greater than the remaining Term as
of the termination date, calculated by the ratio that the remaining Term bears to the remaining
useful life, shall be paid to the Tenant, and the balance of such proceeds for such Improvements
shall be paid to the Landlord.
All other insurance proceeds shall be paid to and become the sole pro perty of the
Tenant. The Tenant shall be responsible for paying all indebtedness owed to Approved Security
Interest Holders from the Tenant's share of insurance proceeds allocated pursuant to this Section
8.6 or from other sources available to Tenant.
Section 8.7 Prosecution of Claims.
In connection with and as a condition of any termination pursuant to Section 8.3 or 8.4,
the Tenant shal I make proof of loss and proceed to collect or commence collecti on of al I val id
claims which the Tenant may have against insurers o r others based upon such damage or
destruction, and shall assign and transfer to the Landlord all rights under insurance policies and
against others and proceeds of insurance and other claims resulting from the casualty.
Upon termination of this Ground Lease, the Tenant shall deliver possession of the
Property and the Improvements thereon to the Landlord and quitclaim to the Landlord all right,
title and interest in the Property and the Improvements thereon.
ARTICLE 9.
APPROVED SECURITY INTERESTS
Section 9.1 Right to Encumber the Lea~hold£state.
The Tenant shall have the right during the Term to enc~mber, throug h an Approved
Security Interest, all of the Tenant's right, title and interest in the Property subject to the
provisions of this Ground Lease; provided, however, any Approved Security Interest shall
remain subordinate and inferior to Landlord's right, title, and interest in the Property and, upon
acquisition of the leasehold interest in the Property, any foreclosing Approved Security Interest
Holder's rights to the Property shall be subject to the terms and provisions of this Ground Lease.
Landlord and Tenant agree that, so long as any Approved Security Interest encumbers th e
leasehold interest in the Property, the prior written consent of the Approved Security Interest
38
1010\26\2824202.8
Holder shall be required (a) in connection with any agreement by Landlord and Tenant (or their
respective successors and assignees) to cancel, waive, terminate (other than termination
following a Tenant Event of Default), surrender, amend or modify this Ground Lease, (b) with
respect to any acceptance by Landlord of any attempted cancellation, termination, or surrender of
this Ground Lease or the on the part of Tenant, and/or (c) with respect to any termination or
cancellation of the Ground Lease by Tenant and/or Landlord pursuant to Artic le 8, or any other
provision of the Ground Lease which gives the Tenant and/or the Land lord an express right to
terminate or cancel the Ground Lease (other than termination fo llowing a Tenant Event of
Default).
Notwithstanding any prov ision to the contrary, the Approved Security Interest Holder(s)
shall have the right to participate in adjustment of losses as to any casualty or hazard insurance
proceeds as set forth in Article 8.
Section 9.2 Notice to A pproved Security Interest Holders.
During any period in which an Approved Security f nterest is in pl ace, the Landlord shall
g ive any such Approved Security Interest Holder of which the Landlord has received notice from
the Tenant, and the Investor, a duplicate copy of all notices of default or other notices that
Landlord may give to or serve in writing upon Tenant pursuant to the terms of this Ground
Lease. The address of the Investor or Approved Security Interest Ho lder originally designated in
the Approved Security Interest may be changed upon written notice delivered to Landlord in the
manner specified in Section 14.1 below. The Landlord's failure to give any such notice to any
such Approved Security Interest Holder, or Investor, shall not render suc h notice ineffective, nor
shall any such failure constitute a Tenant Event of Default hereunder; provided, however, all
rights of the Landlord to terminate this Ground Lease as the result of the occurrence of any
Tenant Event of Default shall be subject to, and conditioned upon: (i) the Landlord having first
given Approved Security Interest Holders, and the Investor, notice of such Tenant Event of
Defaul t, and; (ii) the Approved Security Interest Holder, or the Investor, having failed to remedy
such default or acquire the Tenant's leasehold estate created pursuant to this Ground Lease, or
commence foreclosure or other appropriate proceedings in the nature thereof within the time and
manner set forth in Section 9.3, below, as applicable.
Section 9 .3 Right to Perform and Right to Cure.
Each Approved Security Interest Ho lder, and the Investor, shall have the right, but not the
obligation, at any time prior to termination of this Ground Lease and w ithout payment of any
penalty other than the interest on unpaid Rent, to pay all of the Rents due hereunder, to effect any
insurance, to pay any taxes and assessments, to make any repairs and improvements, to do any
other act or thing required of the Tenant hereunder, and to do any act or thing which may be
necessary and proper to be done in the performance and observance of the agreements, covenants
and conditions set forth in this Ground Lease to prevent a termination of this Ground Lease as
the same would have been if made, done and performed by the Tenant instead of by an Approved
Security Interest Holder or the Investor. Should any event of default under this Ground Lease
occur, and not be cured by the Tenant within the a pplicable notice and cure period provided in
this Ground Lease, the Landlord shall not terminate this Ground Lease nor exercise any other
remedy hereunder unless it first gives written notice of such event of default to the Approved
Security Interest Holders, and the r nvestor, and, thereafter, the Approved Security Interest
39
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Holder, or the Investor, shall have failed, within thirty (3 0) days ofreceipt of said written notice,
either (i) to remedy such default; or (ii) to obtain title to Tenant's interest in the Property in lieu
of foreclosure; or (iii) to commence foreclosure or other appropriate proceedings in the nature
thereof and thereafter diligently prosecute such proceedings to completion. If the Approved
Security Interest Holder, or the lnvestor, takes any of the actions in (i) thru (iii) above, then such
event of default shall be deemed remedied.
Section 9.4 Notice and Right to Cure Defaults Under Approved Security Interests.
Upon the recording of the Memorandum of Lease, the Landlord may record in the
Official Records a request for notice of any default under the Approved Security lnterests. In the
event of default by the Tenant under any of the Approved Security Interests, the Landlord shall
have the right, but not the obligation, to cure the default. Any payments made by the Landlord to
cure a default shall be treated as additional Rent due from the Tenant as provided in Article 3.
Section 9.5 Estoppel Certificates.
The Landlord and the Tenant agree that at any time and from time to time upon not less
than twenty (20) days prior written notice by the other Party, or upon request from any Approved
Security Interest Holder or a permitted assignee or other interested party, the Landlord or the
Tenant shall execute, acknowledge and deliver to the other party or to such other parties a
statement in writing certifying (a) that this Ground Lease is unmodified and in full force and
effect; (b) the date through which the Rent has been paid; and ( c) that, to the knowledge of the
certifier (if such be the case), there is no default, set-off, defense or other claim against the
Landlord or the Tenant, as applicable, other than those, if any, so specified under the provisions
of this Ground Lease. It is intended that any such statement may be relied upon by any persons
proposing to acquire the interest of the Landlord, the Tenant or any Approved Security Interest
Holder, as the case may be, in this Ground Lease or by any assignee of any Approved Security
r nterest Holder.
Section 9.6 Mort!@g_e of Landlord's Estate.
The Landlord agrees not to encumber or convey any interest in the Landlord's fee interest
in the Property with any deed to secure debt, mortgage, deed of trust or other instrument in the
nature thereof as security for any debt which is not expressly subordinate to the Tenant's interest
in the Property under this Ground Lease and to any Approved Security Interest without the
written consent of the Tenant, Investor, and the Approved Security Interest Holder(s). The
Landlord agrees not to permit any liens arising from work contracted for by the Landlord to be
filed against the Property without causing the same to be removed or bonded over within thirty
(30) days of such fi ling.
Section 9.7 Registration of Approved Security Interests.
The Tenant shat I provide written notice to the Landlord of the name and address of each
Approved Security [nterest under this Ground Lease.
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ARTICLE 10.
SURRENDE~R; HOLDING OVER
Section 10.1 Surrender of Property.
(a) Tenant Notice. The Tenant shal l, at least ninety (90) days before the last
day of the Term, give to Landlord a written notice of Tenant's intention to surrender the Property
and the Improvements thereon on that date, but nothing contained in this Section shall be
construed as an extension of the Term of this Ground Lease or as consent of Landlord to any
holding over by Tenant.
(b) Surrender. At the end of the Term or other sooner termination of this
Ground Lease, Tenant shall surrender and deliver to Landlord the Property and the possession of
the Property, together with all r mprovements, and any Personal Property (if any) in condition
required for the Property and Improvements to be maintained under this Ground Lease, and free
and clear of all liens and encumbrances other than those, if any, presently existing or created by
Landlord, without payment or allowance whatever by Landlord on account of any such
Improvements.
(c)
Section 6.2, above.
Quitclaim Deed. The Tenant shall execute such documents as set forth in
(d) Delivery. Unless otherwise agreed by Landlord, Tenant shall cause and be
solely responsible for the Property and the Improvements to be delivered vacant to the Landlord
in accordance with al l applicable Relocation Laws at time of surrender. The Tenant shall
indemnify the Landlord for any c laims relating to relocation of any occupants on the Property,
and the Tenant's failure to comply with any Re location Laws prior to, or after, the Effective
Date.
(e) No Relocation C laim. Tenant acknowledges that the Tenant has
voluntaril y entered into this Ground Lease, and, upon the expiration or termination of this
Ground Lease, the Tenant shall not be entitled to any relocation assistance, or any othe r benefit,
under the Relocation Laws, or any other provision of law. Therefore, Tenant, on behalf of itself,
and any Person claiming, by, through, or under, the Tenant waives any claim to such assistance
or benefits, and shall be estopped from asserting any such claims.
Section 10.2 Ho lding Over.
If the Tenant shall retain possession of the Property or the Improvements thereon or any
part thereof without the Landlord's prior written consent fol lowing the expiration or sooner
termination of this Ground Lease for any reason (the "Holding Over Period"), then the Tenant
shall pay to the Landlord an amount equal to two hundred percent (200%) of the fair market rent
for the Property (as reasonably determined by the Landlord) and other payments that would have
been due had the Ground Lease not expired or been terminated and had the Rent and other
payment terms in effect at the time of the expiration or sooner termination of the Ground Lease
4 1
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remained in effect. These payments shall be applicable to a holding over of any kind by the
Tenant. The Tenant shall a lso indemnify and hold the Landlord harmless from any loss or
liability resulting from de lay by the Tenant in surrendering the Property, including, without
limitation, any claim s made by any succeeding tenant founded on such delay. Acceptance of
Rent by the Landlord following expiration or termination shall not constitute a renewal of this
Ground Lease and nothing contained in this Section 10.2 shall waive the Landlord's right of
reentry or any other right. The Tenant shal l be only a tenant at sufferance, whether or not the
Landlord accepts any Rent from the Tenant while the Tenant is holding over without the
Landlord's written consent.
Section I 0.3 No Merger.
Except upon expiration of the Tenn or upon termi nation of this Ground Lease pursuant to
an express right of termination set forth herein, there shall be no merger of either this Ground
Lease or the Tenant's estate created hereunder with the fee estate of the Property or any part
thereof by reason of the fact that the same person may acquire, own or hold, directly or
indirectly, (a) this Ground Lease, the Tenant's estate created hereunder or any interest in this
Ground Lease or the Tenant's estate (including the Improvements), and (b) the fee estate in the
Property or any part thereof or any interest in such fee estate (including the Improvements),
unless and until all persons, including any assignee of the Landlord, having an interest in (i) this
Ground Lease or the Tenant's estate created hereunder, and (ii) the fee estate in the Property or
any part thereof, shall join in a written instrument effecting such merger and shall duly record the
same.
ARTJCLE 11.
EMINENT DOMAIN
Section 11 .1 Total Taking.
If either the entire Property (or any improvements thereon) or a substantial and essential
portio n of the Property (or any improvements thereon), the taking of which portion materially
impairs the use of the Improvements then being made by Tenant and renders the remainder of t he
Improvements unsuitable or economically not feasible for such use, as reasonably determined by
Tenant in good faith, is taken under the power of eminent domain during the Term of this
Ground Lease, then this Ground Lease shall terminate as of the date of such taking. The
Landlord and the Tenant shall together make o ne claim for an award for their combined interests
in the Property and all buildings, structures, Im provements and fixtures thereon which are so
taken. Such award shall be paid to and divided between the Landlord and the Tenant in priority
as fol lows:
(a) All compensation and damages payable for or on account of the
underlying fee title to the Property, assuming that the Property were unimproved but encumbered
by this Ground Lease, sha ll be payable to and be the sole property of the Landlord.
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(b) All compensation and damages payable for or on account of the bui ldings
and Improvements located on the Property sha ll be divided between the Landlord and the Tenant
in the manner specified in Section 8.6 of this Ground Lease.
Section I 1.2 Partial Taking.
If less than the whole of the Property is taken under the power of eminent domain during
the Term of this Ground Lease and this Ground Lease is not terminated as provided in Section
11 .1 hereof, then this Ground Lease shall terminate only with respect to the portion of the
Property taken and this Ground Lease shall continue in full force and effect with respect to the
portion of the Property not taken. The Tenant shall, but only to the extent of the amount of the
award received, promptly reconstruct and restore the portion of the Property not taken and the
buildings and Improvements located on the portion of the Property not taken as an integral unit
of the same general quality and character as existed prior to such taking. Such reconstruction
and restoration shall be performed in a good and workmanlike manner a nd undertaken in
accordance with plans and specifications submitted to and approved by the Landlord in
accordance with Article 4, and otherwise in accordance with the applicable provisions of this
Ground Lease.
All awards or other payments received on account of a partial taking as described in this
Section 11 .2 shall be paid to the Insurance Trustee referred to in Section 8.5 above to be held and
disbursed in the same manner as insurance proceeds, except that any portion of such award
remaining after completion of any restoration shall be divided between the Landlord and the
Tenant and disbursed by the Insurance Trustee in the manner provided in Section 8.6.
Section 11.3 Temporary Taking.
If the use of all or any part of the Property is taken under the power of eminent domain
during the Term on a temporary basis for a period less than the time remaining after the date of
such taking to the end of the Term, then this Ground Lease shall continue in full force and effect
and the Tenant shall continue to be obligated to pe rform and observe all of the agreements,
covenants and conditions on the part of the Tenant to be performed and observed as and when
performance and observance is due to the fu ll extent that such agreements, covenants and
conditions are physically capable of performance and observance by the Tenant after such
taking. The award payable for or on account of such taking shall be paid to the Tenant.
Section 11.4 Notice of Taking; Single Proceeding.
In case of a taking of all or any part of the Property or the Improvements thereon or the
commencement of any proceeding or negotiations which might result in such taking, the party
having notice of such taking or of the commencement of any such proceeding or negotiations
shall promptly give written notice thereof to the other party. The Landlord and the Tenant shat I
jointly prosecute their claims for an award in a single proceeding, in which any Approved
Security Interest Holder may join. In any eminent domain proceeding affecting the Property,
both the La ndlord and the Tenant, as wel l as any Approved Security Interest Holder(s), shall
have the right to appear in the proceeding and to defend against the eminent domain action as
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they deem proper in accordance with their own interests. To the extent possible, the Landlord
and the Tenant shall reasonably cooperate with each other to maximize the amount of the award
payable by reason of the eminent domain. Issues between the Landlord and the Tenant that arise
under this Article 1 I shall be joined in any such eminent domain proceeding to the extent
permissible under then applicable ru les governing such joinder.
As used in this Ground Lease: (l) a "taking" means the acquisition of all or any part of
the Property for a public use by exercise of the power of eminent domain; (2) the taking shall be
considered to occur as of the earlier of the date on which possess ion of the Property by the entity
exercising the power of eminent domain is authorized as stated in an order for possession, or the
date on which title to the Property vests in the person exercising the power of eminent domain;
and (3) "award" means the compensation paid for the taking.
ARTICLE 12.
EVENTS OF DEFAULT
Section 12.1 Events of Default.
Each of the following, subject to the applicable notice and cure period below, shall be a
"Tenant Event of Default" by the Tenant hereunder:
(a) Failure by the Tenant to pay any Rent when due or to pay or cause to be
paid any, insurance premiums or other liquidated sums of money herein stipulated to be paid by
the Tenant, if such fail ure shall continue for a period of ten ( 10) days after written notice thereof
has been given by the Landlord to the Tenant;
(b) The Tenant breaches, and thereafter fails to cure with in the time frame set
forth in subsection (h) below, any provision of Article 4;
(c) The Tenant breaches, and thereafter fails to cure within the time frame set
forth in subsection (h) below, any provision of Article 5;
(d) A Bankruptcy/Insolvency Event occurs w ith respect to the Tenant;
(e) The Tenant completes a Transfer without obtaining the Landlord's prior
written consent to the extent required pursuant to this Ground Lease and thereafter fai ls to cure
within the time frame set forth in subsection (h) below;
(f) The failure of the Tenant to fu lly repair and restore the Improvements in
accordance with the requirements of Article 8 and thereafter fai ls to cure within the time frame
set forth in subsection (h) below;
(g) Subject to this Article 9, and except as expressly provided otherwise in
this Ground Lease, failure by the Tenant to perform or observe any other provisions of this
Ground Lease or any of the Development Documents to be observed and performed by the
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Tenant, if such failure shall continue for a period of sixty (60) days after written notice thereof
has been given by the Landlord to the Tenant; provided, however, that if any such fai lure cannot
reasonably be cured within such sixty (60) day period, then the La ndlord shall not have the right
to terminate this Ground Lease or the Tenant's right to possession hereunder so long as the
Tenant promptly commences the curing of any such fai lure and thereafter proceeds in good faith
and with due diligence to remedy and correct such fai lure within a reasonable period of time;
provided, however, that such period sh al I not extend for more than one hundred twenty ( 120)
days after the date of the Landlord's notice to the Tenant (unless otherwise permitted by the
Landlord), or the maximum permitted cure period permitted by the applicable Development
Documents .
Any cure of a default by the Investor, or an Approved Security Interest Holder, shall be
deemed to be a cure by the Tenant, and shall be accepted or rejected on the same basis as if made
or tendered by the Tenant.
Section 12.2 Rights and Remedies.
(a) Termination. At any time after the occurrence of a Tenant Event of
Default hereunder, the Landlord, subject in all respects to the provisions of this Ground Lease
with respect to the Landlord's rights to cure defaults by the Tenant and with respect to the ri ghts
of any Approved Security Interest Holders, may terminate this Ground Lease by giving the
Tenant written notice thereof (with a copy of such notice to the Approved Security rnterest
HQlders), setting forth in such notice an effective date for termination which is not less than
thirty (30) days after the date of such notice, in which event th is Ground Lease and the Tenant's
estate created hereby and all interest of the Tenant and all parties claiming by, through or under
the Tenant shall automatically term inate upon the effective date for termination as set forth in
such notice, with the same force and effect and to the same extent as if the effective date of such
notice had been the date originally fi xed in Article 2 hereof for the expirati on of the Term. In
such event, the Landlord, its agents or representatives, shall have the right, without further
demand or notice, to re-enter and take possession of the Propetty (including all buildings, the
Improvements, and other improvements comprising any part thereof) at any time from and after
the effective termination date without being deemed guilty of any manner of trespass and without
prejudice to any remedies for arrears of Rent or existing breaches of covenants or any other
remedy available at law or equity to the Landlord.
(b) Complete Construction. Subject to the rights of any Approved Security
Interest Holder, upon any Tenant Event of Default that occurs during the course of construction
of the Improvements, the Landlord in its sole discretion may enter and take possession of the
Property, whether in person, by agent or by court-appointed receiver, and take any and all actions
that the Landlord in its sole discretion may consider necessary to complete construction of the
Improvements, including making changes in plans, specifications, work or materials and entering
into, modifying or terminating any contractual arrangements, all subject to the Landlord's ri ght at
any time to discontinue any work without liabi lity. By choosing to complete the construction of
the Improvements, the Landlord does not assume any liability to Tenant or any other person for
completing the Improvements or for the manner or quali ty of its construction, and Tenant
expressly waives any such liability. If the Landlord exercises any of the rights or remedies
45
1010\26\2824202.8
provided in this clause, that exercise will not make the Land lord, or cause the La ndlord to be
deemed, a partner or joint venturer of Tenant. Landlord in its sole discretion may choose to
complete construction in its own name. All sums expended by Landlord in completing
construction will be considered an Advance pursuant to Section 3.2 bearing interest at the
Default Interest Rate. For these purposes the Landlord, in its sole discretion, may reallocate any
line item or cost category of the cost breakdown.
(c) Additional Remedies. In addition to the remedy set forth above, upon any
Tenant Event of Default the Landlord may exerci se any remedy available at law or at equity,
including, but not limited to, specific performance.
(d) Remedies Cumulative. No right, power, or remedy given to the Landlord
by the te rms of this Ground Lease is intended to be exclusive of any other right, power, or
re medy; and each and every such right, power, or remedy shall be cumulative and in addition to
every other right, power, or remedy given to the Landlord by the terms of any such instrument,
or by any statute or otherwise against Tenant and any other person. Neither the fa ilure nor any
delay on the part of the Landlord to exercise any such rights and remedies shall operate as a
waiver thereof, nor shall any single or partial exercise by the Landlord of any such right or
remedy preclude any other or further exercise of such right or remedy, or any other right or
remedy.
(e) Tenant Obligation. Upon the exercise of the Landlord's remedies pursuant
to this Section 12.2, the Tenant shall execute such releases, deeds and other instruments in
recordable form as the Landlord shall reasonably request in order to accurately set forth of record
then current status of the Tenant's estate in th e Property and the Tenant's rights hereunder. The
obligations set forth in this subsection shall survive the termination of the Ground Lease.
Section 12.3 Default by the Landlord.
(a) Events of Default. The Landlord shall be in default of this Ground Lease
if it fails to perform any material provision of this Ground Lease that it is obligated to perform,
and if the failure to perform is not cured within thirty (30) days after written notice of the default
has been given to the Landlord. lf the default cannot reasonably be cured within thirty (30) days,
the Landlord shall not be in default of this Ground Lease if the Landlord commences to cure the
default within such thirty (30) day period and di ligently and in good faith continues to cure the
default until completion.
(b) Right to Cure; the Tenant's Remedies. If the Landlord shall have failed to
cure a default by the Landlord after expiration of the applicable time for cure of a particular
default, the Tenant, at its election, but without obligation therefor (i) may seek specific
performance of any obligation of the Landlord, after w hich the Tenant shall retain, and may
exercise and enforce, any and all rights that the Tenant may have hereunder, at law or at equity
against the Landlord as a result of such default, (ii) from time to time without releasing the
Landlord in whole or in part from the obligations to be performed by the Landlord hereunder,
may cure the default at the Landlord's cost, and/or (iii) may terminate this Ground Lease.
46
1010\26\2824202.8
(c) Notices. Notices given by the Landlord under Section 12.1 or by the
Tenant under Section 12.3 shall specify the alleged default and the applicable Ground Lease
provisions, and shall demand that the Tenant or the Landlord, as applicable, perfonn the
appropriate provisions of this Ground Lease within the applicable period of time for cure. No
such notice shall be deemed a forfeiture or termination of this Ground Lease unless expressly set
forth in such notice.
ARTICLE 13.
REPRESENT ATJONS AND WARRANTIES
Section 13. I Representation and Warranties of Tenant.
The Tenant hereby represents and warrants to the Landlord as follows:
(a) Organization. The Tenant is a duly organized, validly existing California
limited partnership, and is in good standing under the laws of the State of California and,
pursuant to the Partnership Agreement, has the power and authority to own its property and carry
on its business as now being conducted. The Tenant shall not amend the Partnership Agreement
except in accordance w ith the City Loan Agreement.
(b) Authority of Tenant. The Tenant has fu ll power and authority to execute
and deliver this Ground Lease, and any other document to be executed and delivered, pursuant to
this Ground Lease, and to perform and observe the terms and provisions of all of the above.
(c) Authority of Persons Executin g Documents. Thi s Ground Lease and all
other documents or instruments executed and delivered, or to be executed and delivered,
pursuant to this Ground Lease have been executed and delivered by persons who are duly
authorized to execute and deliver the same for and on behalf of Tenant, and all actions required
under the Tenant's organizational documents and applicable governing law for the authorization,
execution, delivery and performance of this Ground Lease and all other documents or
in struments executed and delivered, or to be executed and delivered, pursuant to this Ground
Lease, have been duly taken.
(d) Valid Binding Agreements. This Ground Lease and all other documents
or instruments which have been executed and delivered pursuant to or in connection with this
Ground Lease constitute or, if not yet executed or delivered, will when so executed and delivered
constitute, legal, valid and binding obligations of the Tenant enforceable against it in accordance
with their respective terms subject only to bankruptcy, insolvency and other limitations on
creditors' rights generally and to equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(e) No Breach of Law or Agreement. Neither the execution nor del ivery of
this Ground Lease or of any other documents or instruments executed and delivered, or to be
executed or delivered, pursuant to this Ground Lease, nor the performance of any provision,
condition, covenant or other term hereof or thereof, will conflict with or result in a breach of any
47
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statute, rule or regulation, or any judgment, decree or order of any court, board, commission or
agency whatsoever binding o n the Tenant, or any provision of the organizational documents of
the Tenant, or will conflict with or constitute a breach of or a default under any material
agreement to which the Tenant is a party, or wi ll result in the creation or imposition of any lien
upon any assets or property of the Tenant, other than liens established pursuant hereto.
(t) Compliance with Laws; Consents and Approvals. The construction of the
Improvements, and any other construction work, will comply with a ll applicable laws,
ordinances, rules and regulations of federal, state and local governments and agencies and with
all applicable directions, rules and regul ations of the fire marshal , health officer, building
inspector and other officers of any such government or agency.
(g) Pending Proceedings. The Tenant is not in default under any law or
regulation or under any order of any court, board, commission or agency whatsoever, and there
are no c la ims, actions, suits or proceedings pending or, to the knowledge of the Tenant,
threatened against or affecting the Tenant, at law or in equity, before or by any court, board,
commission or agency whatsoever which might, if determined adversely to the Tenant,
materially affect the Tenant's ability to develop the Improvements.
(h) Financial Statements. The financial statements of the Tenant, and other
financial data and information furnished by the Tenant to the Landlord, fairly present the
information contained therein. As of the date of this Ground Lease, there has not been any
adverse, material change in the financial condition of the Tenant from that shown by such
financial statements and other data and information.
ARTICLE 14.
MISCELLANEOUS PROVISIONS
Section 14.1 Notice, Demands and Communication.
(a) Notices. Formal notices, demands, and communications between the
Landlord and the Tenant shall be in writing and shall be sufficiently given if and shall not be
deemed given unless d ispatched by: (i) registered or certified mail, postage prepaid, return
receipt requested; (ii) de livered by personal delivery or reputable overnight delivery service; or
(iii) delivered by facsimile or by electronic mail, with an additional copy immediately delivered
by one of the methods set forth in clause (i) or (ii), to the principal office of the Parties as
fo llows:
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Landlord:
with a copy to:
Tenant:
with a copies to:
and:
and:
and:
1010\26\2824202.8
City of Carl sbad
Community Development Department
Housing Services
1200 Carlsbad Village Drive
Carlsbad, CA 92008-1949
Attn: Housing Services Manager
Email: Housing@carlsbadca.gov
Fax: 760-720-2037
City of Carlsbad
Office of the City Attorney
1200 Carlsbad Village Drive
Carlsbad, CA 92008-1949
Attn: City Attorney
Email : Attorney@carlsbadca.gov
Fax: 760-720-2 037
Carlsbad Veteran Housing, L.P.
c/o Affirmed Housing Group, Inc.
13520 Evening Creek Dri ve, Suite 160
San Diego, CA 92 128
Attention: James Silverwood, President
Fax No.: 858-67 9-9076
Katten Muc hin Rosenman LLP
2029 Century Park East, Suite 2600
Los Angeles, CA 90067
Attention: David Cohen, Esq.
FaxNo.: 310-788-447 1
Las Palmas Foundation
53 1 Encinitas Boulevard, Suite 206
Encinitas, CA 92024
Attention: Joseph M. Michaels
Fax No.: 760-944-9908
Hobson Bernardino
725 S. Figueroa Street, Suite 3230
Los Angeles, CA 9001 7
Attentio n: Jason A. Hobson, Esq.
Fax No.: 2 13-235-9191
Raymond James Tax Credit Fund XX L.L.C.
c/o Raymond James Tax Credit Funds, Inc.
880 Cari I Ion Parkway
St. Petersburg, Florida 33716
49
and:
Fax: 727-567-8455
Bocarsly Emden Cowan Esmail & Arndt LLP
633 West 5th Street, 64th Floor
Los Angeles, California 90071
Attention: Kyle Arndt, Esq.
Fax No.: 213-239-0410
(b) New Address; Delivery. Such written notices, demands and
communications may be sent in the same manner to such other addresses as the affected party
may from time to time designate by mail as provided in this Section. Receipt shall be deemed to
have occurred on the date shown on a written receipt for delivery or refusal of delivery.
(c) Mandatory Provision Regarding Deemed Approval. Notwithstanding any
provision of this Ground Lease to the contrary, in no event shall any submittal by the Tenant to
the City be deemed approved unless the request for approval contains the fo llowing provision, in
bold print, with the blank space completed by Tenant with the appropriate number of days
provided for the approval of such item in this Ground Lease:
NOTICE IS HEREBY GIVEN THAT FAILURE TO APPROVE OR DISAPPROVE THE
REQUESTED MATTER WITHIN _ DAYS SHALL BE DEEMED AN APPROVAL
PURSUANT TO SECTION OF THE GROUND LEASE. THIS PROVISION HAS
BEEN INCLUDED WITH THIS SUBMITTAL PURSUANT TO SECTION 14.1 OF THE
GROUND LEASE.
The City shall not be deemed to have approved, or otherwise waived any approval right, of any item
submitted by the Tenant if the notice from the Tenant does not include such provision as set forth
above. In the event of any conflict between this provision and any other provision of this Ground
Lease, the terms of this provision shall control.
Section 14.2 Non-Liability of City Personnel.
No councilmember, commissioner, director, officer, employee or agent of the Landlord shall
be personally liable to the Tenant, or any successor in interest, in the event of any default or breach
by the Landlord or for any amount which may become due to the Tenant or its successor or on any
obligation under the terms of this Ground Lease.
Section 14.3 Enforced Delay.
In addition to specific provisions of this Ground Lease, performance by either Party shall
not be deemed to be in default where delays or defaults are due to war; acts of terrorism;
insurrection; strikes; lock-outs; riots; floods; earthquakes; fires; widespread disease (including
without limitation COVID-19) or quarantine; strikes and disruption of shipping, labor or material
shortages or disruption; government instability; or any other similar causes set forth in the City
Loan Agreement (other than lack of fu nds of the Tenant or the Tenant's inability to finance the
Development) beyond the control or without the fault of the Party claiming an extension of time
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to perform. An extension of time for any cause shall be deemed granted if notice by the Party
claiming such extension is sent to the other within thirty (30) days from the commencement of
the cause, and such extension of time is not rejected, in writing, by the other Party within thirty
(30) days after receipt of the notice. In no event shall the cumulative delays exceed one hundred
eighty ( 180) days unless otherwise agreed to in writing by the Parties. Times of performance
under this Gro und Lease may also be extended by written agreement of the Landlord and the
Tenant.
Section 14.4 Inspection of Books and Records.
The Landlord and its agents have the right at all reasonable times to inspect on a confidential
basis the books, records and all other documentation of the Tenant pertaining to its obligations
under this Ground Lease. The Tenant shall retain such books, records and documentation for a
period of five (5) years after their creation.
Section 14.5 Title of Parts and Sections.
Any titles of the sections or subsections of this Ground Lease are inserted for convenience
of reference only and shall be disregarded in construing or interpreting any part of its provision.
Section 14.6 Indemnification.
(a) Obligation. Upon demand by Landlord, and in addition to any obligation set
forth in the Purchase Agreement, Loan Agreement, Regulatory Agreement, and applicable land use
permits and approvals, Tenant shall indemnify, defend (with counsel reasonably selected by
Landlord) and hold harmless Landlord and its councilmembers, commissioners, directors, officers,
employees, agents, successors, and assigns (each an "Indemnified Party") from and against any and
all claims, liens, demands, losses, damages, liabilities, fines, penalties, charges, administrative and
judicial proceedings and orders, and all costs incurred in connection therewith (i ncluding without
limitation actual attorneys' fees and costs of experts and consultants) arising from: (i) Tenant's
performance or non-performance of its obligations under this Ground Lease; (ii) Tenant's lease of
the Property; or (iii) the development, construction, marketing, rental and operation of the
Development or the relocation of any occupants on the Property, except for claims arising solely
from the gross negligence, willful misconduct, illegal acts, or breach of this Ground Lease by any
Indemnified Party.
(b) Survival. The provisions of this Section shall survive the expiration of the
Tenn.
Section 14.7 No Claims.
Nothing contained in this Ground Lease shall create or justify any claim against the
Landlord by any person that Tenant may have employed or with whom Tenant may have contracted
relative to the purchase of materials, supplies or equipment, or the furnishing or the performance of
any work or services with respect to the construction or operation of the Development.
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Section 14.8 A.m2.licab_le_Law.
This Ground Lease shall be interpreted under and pursuant to the laws of the State of
California.
Section 14.9 Severability.
l f any term, provision, covenant or conditi on of this Ground Lease is held by a court of
competent juri sdiction to be invalid, void or unenforceable, the remainder of the provision shall
continue in full force and effect unless the rights and obligations of the parties have been materially
altered or abridged by such invalidation, voiding or unenforceability.
Section 14.10 Legal Actions.
Any legal action commenced to interpret or to enforce the terms of th is Ground Lease shall
be filed in the Superior Court of the County.
Section 14.1 l Binding Upon Successors; Covenants to Run With Land.
This Ground Lease shall be binding upon and inure to the benefit of the heirs,
administrators, executors, successors in interest and assigns of each of the parties; provided,
however, that there shall be no transfer of any interest by the Tenant except pursuant to the terms of
this Ground Lease. Any reference in this Ground Lease to a specifically named Party shall be
deemed to apply to any successor, heir, administrator, executor or assign of such Party who has
acquired an interest in compliance with the terms of this Ground Lease, or under law.
The terms of this Ground Lease shall run with the land and shall bind all successors in title
to the Property during the Term of this Ground Lease, except that the provisions of this Ground
Lease that are specified to survive termination of this Ground Lease shall run with the land in
perpetuity and remain in full force and effect following such termination. Every contract, deed, or
other instrument hereafter executed covering or conveying the Property or the Improvements or any
portion thereof shall be held conclusively to have been executed, deliver, and accepted subject to
such covenants and restrictions, regardless of whether such covenants or restricts are set forth in
such contract, deed or other instrument, unless the Landlord expressly releases the Property, the
Improvements, or the applicable portion of the Property, from the requirements of this Ground
Lease.
Section 14.12 Relationship of Parties; City as Landlord.
(a) Relationship of Parties. Nothing contained in this Ground Lease shall be
interpreted or understood by either of the Parties, or by any third persons, as creating the
re lationship of employer and employee, principal and agent, limited or general partnership, or joint
venture between the Landlord and Tenant or their agents, employees or contractors, and Tenant
shall at all times be deemed an independent contractor and shall be wholly responsible for the
manner in which it or its agents, or both, perform the services required of it by the terms of this
Ground Lease. Tenant has and retains the right to exercise full control of employment, direction,
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compensation, and discharge of all persons assisting in the performance of services under the
Ground Lease. 1n regard to the construction and operation of the Development, Tenant shal l be
solely responsi ble for all matters relating to payment of its employees, including compliance with
Social Security, withholding, and all other laws and regulations governing such matters, and shall
include requirements in each contract that contractors shall be solely responsible for similar matters
relating to their employees. Tenant shall be solely responsible for its own acts and those of its
agents and employees.
(b) Capacity of City as Landlord. Except where clearly and expressly provided
otherwise in this Ground Lease, the capacity of City in this Lease shall be as a landlord only, and
any obligation or restriction, if any, imposed by thi s Ground Lease on City shall be limited to that
capacity and shall not relate to, or otherwise affect, any activity of City in its capacity as a
Governmental Authority, including but not limited to enacting laws, inspecting structures,
reviewing and issuing permits, or all other legislative, administrative, or enforcement functions of
City pursuant to federal, state, or local law. Nothing in this Ground Lease shall be construed as
abrogating or limiting any immunity or exemption to which City is entitled under law.
Section 14.13 Time.
Time is of the essence in this Ground Lease. All references to days in this Ground Lease are
calendar days, unless explicitly referenced as a Business Day. The number of days specified in any
provision of this Ground Lease shall be counted by excluding the first day and including the last
day, unless the last day is a not a Business Day, in which case it shall be excluded. Any act required
by this Ground Lease to be performed by a certain day is timely performed if completed before 5:00
p.m. local time on that date. If the day for performance of any obligation under this Ground Lease
is not a Business Day, then the time for performance of that obligation is extended to 5:00 p.m. local
time on the first day following that is a Business Day.
Section 14.14 Third-Party Beneficiary.
No person or entity other than the Landlord, the Tenant, and their permitted successors and
assigns shall have any right of action under this Ground Lease.
Section 14.15 Further Assurances.
At any time upon, and from time to time upon request by Landlord, Tenant shall do any
acts and execute and deliver any documents as may be reasonably requested by Landlord to
accomplish the purposes of thi s Ground Lease or normally required for s imilar leases for the
development and operation of affordable housing within the City by prudent landlords in
accordance with reasonable commercial standards.
Section 14.16 Amendments.
This Ground Lease shall not be modified or amended in any respect, except by written
instrument specifically referencing such a modification or amendment which is executed by or
53
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on behalf of the parties in the same manner as this Ground Lease is executed. Any modification
or amendment of this Ground Lease shall require the prior written consent of the Investor.
Section 14.17 \Vai_v~rs,
Any waiver by the Landlord of any obligation or condition in this Ground Lease must be in
writing. No waiver will be implied from any delay or failure by the Landlord to take action on any
breach or Tenant Event of Default or to pursue any remedy allowed under this Ground Lease or
applicable law. Any extension of time granted to Tenant to perform any obligation under this
Ground Lease shall not operate as a waiver or release from any of its obligations under this Ground
Lease. Consent by the Landlord to any act or omission by Tenant shall not be construed to be a
consent to any other or subsequent act or omission or to waive the requirement for the Landlord's
written consent to future waivers.
Section 14. I 8 Entire Understandin_g_Qf the Parties.
The terms and provisions of this Ground Lease and the Development Documents supersede
• any inconsistent terms and conditions of any term sheet, commitment letter, or similar document
issued by Landlord to Tenant. This Ground Lease and the attached exhibits constitute the entire
agreement of the Parties with respect to the matters set forth in th is Ground Lease. This Ground
Lease supersedes any prior agreement and understandings between the Parties as to such matters,
oral or written, all of which are hereby cancelled. This Ground Lease shall not be construed as if it
had been prepared by one of the Parties, but rather as if both Parties had prepared it. The Pa1ties
have read and reviewed this Ground Lease and agree that any rule of construction to the effect that
ambiguities are to be resolved against the drafting party (including but not limited to California
Civil Code Section 1654 as may be amended from time to time, or any other state law, or common
law principle) shall not apply to the interpretation of this Ground Lease.
Section 14.19 Survival.
All of the representations and warranties in this Ground Lease shall survive until the
expiration of the Term of this Ground Lease and payment of City Note (whichever is later), except
to the extent that a representation or warranty expressly provides otherwise.
Section 14.20 Gender and Number.
Words of any gender used in this Ground Lease shall be held to include any other gender,
and any words in the singular number shall be held to include the plural (and vice versa), when the
sense requires.
Section 14.21 Multiple Originals; Counterparts.
This Ground Lease may be executed in counterparts and multiple originals, each of which
shall be deemed to be an original. This Ground Lease shall become effective when the Parties
have duly executed and delivered signature pages of this Ground Lease to each other. Delivery
of this Ground Lease shall be effectuated by electronic communication (including by PDF sent
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IO I 0\26\2824202.8
by electronic mail, facsimile or similar means of electronic communication). Any signatures
(including electronic signatures) delivered by electronic communication shall have the same
legal effect as physically delivered original signatures.
Remainder of Page Left Intentionally Blank
55
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WHEREFORE, the Parties have executed this Ground Lease as of the Effective Date.
IO I 0\26\2824202.8
LANDLORD:
CITY OF CARLSBAD, a municipal corporation
By: ~~
Geoff Patnoe, Assistant City Manager
APPROVED AS TO FORM AND LEGALITY
By: ~ Jl--Htl{~
CrNDIE K. MCMAHON
Assistant City Attorney
Signatures continue on following page
56
Note: Tenant Must Initial Section 2.5
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TENANT:
CARLSBAD VETERAN HOUSING, L.P., a
California limited partnership
By: AHG Windsor Pointe, LLC, a California
limited liability company, its Administrative
General Partner
By: Affirmed Housing Group, Inc., a
Delaware corporation, its Manager
By:
By: Las Palmas Fouikiltion, a California non-
profit public benefit corporation, its
Managing General Partner
By:
Joseph M. Michaels, President
57
Note: Tenant Must Initial Section 2.5
IO I 0\26\2824202. 8
TENANT:
CARLSBAD VETERAN HOUSING, L.P., a
California limited partnership
By: AHG Windsor Pointe, LLC, a California
limited liability company, its Administrative
General Partner
By: Affirmed Housing Group, Inc., a
Delaware corporation, its Manager
By:
James Silverwood, President
By: Las Palmas Foundation, a Califon~ia non-
57
profit public benefit corporation, i
Managing General Part!
By:,_tM."K ,.,, · · i4'fr -I V (/ I // V \, ==-....
EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
The land referred to herein below is situated in the County of San Diego, State of Cal ifornia, and
is described as follows:
PARCEL A:
ALL THAT PORTION OF LOT I OF THE SUBDIVISION OF TRACTS 11 4 AND 120 OF
CARLSBAD LAND, IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STA TE OF
CAUFORNIA, ACCORDING TO MAP THEREOF NO. 1744. FJLED IN THE OFFICE OF
THE COUNTY RECORDER OF SAN DIEGO COUNTY, JANUARY 3, 1923, DESCRIBED
AS FOLLOWS:
BEGINNING AT A POINT OF THE CENTER LINE OF OAK A VENUE, DISTANT
THEREON NORTH 55° 27' EAST 469.95 FEET FROM ITS INTERSECTION WITH THE
CENTER LINE OF FIFTH STREET, THENCE CONTINUING ALONG THE SAID CENTER
LINE OF OAK AVENUE, NORTH 55° 27' EAST A DISTANCE OF 90 FEET TO THE
NORTHWESTERLY CORNER OF THAT TRACT OF LAND AS CONVEYED BY THE
SOUTH COAST LAND COMPANY TO ROBERT W. AND MARYE. CHAMBERS, BY
DEED DATED APRIL 13, 1925 AND RECORDED IN BOOK I 095. PAGE 20 OF DEEDS;
THENCE ALONG THE SOUTHWESTERLY LINE OF SAID CHAMBERS LAND, SOUTH
34° 33' EAST A DISTANCE OF 480 FEET TO A POINT ON THE CENTER LINE OF PINE
A VENUE; THENCE ALONG THE SAID CENTER LINE OF PINE A VENUE SOUTH 55° 27'
WEST, A DISTANCE OF 90 FEET; THENCE NORTH 34° 33' WEST A DISTANCE OF 480
FEET TO A POINT OF BEGINNING.
EXCEPTING THEREFROM THE SOUTHEASTERLY 240 FEET.
TOGETHER WITH THAT PORTION OF OAK A VENUE CONTIGUOUS AND ADJACENT
NORTHWESTERLY TO THE ABOVE DESCRIBED LAND AS VACA TED AND CLOSED
BY A RESOLUTION OF THE CITY OF CARLSBAD RECORDED MARCH 3. 1961 AS
FILE/PAGE NO. 38238 OF OFFICIAL RECORDS.
EXCEPTING THEREFROM THAT PORTION OF SAID VACATED STREET DESCRIBED
AS FOLLOWS:
BEGINNING AT A POlNT ON THE CENTER LINE OF OAK AVENUE, DISTANT ALONG
SAID CENTER LINE NORTH 55° 59' 02" EAST, 554.35 FEET FROM THE INTERSECTION
OF SAID CENTER LINE WITH THE CENTER LINE OF HARDING STREET (FORMERLY
FIFTH STREET); THENCE (l ) SOUTH 34° 00' 58" EAST, 30.00 FEET TO THE
NORTHWESTERLY LINE OF THE SOUTHERLY IO FEET OF OAK AVENUE, AS
CLOSED TO PUBLIC USE BY THE CITY OF CARLSBAD BY RESOLUTION NO. 723,
RECORDED MARCH 3, 1961 AS FILE/PAGE NO. 38238 OF OFFICIAL RECORDS;
THENCE (2) SOUTH 79° 00' 58" EAST, 7.89 FEET TO THE NORTHEASTERLY LINE OF
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SAID AAPODACA'S LAND THENCE (3) ALONG SAID NORTHEASTERLY LINE,
NORTH 34° 0 I' 26" WEST, 35.58 FEET TO SAID CENTER LINE OF OAK A VENUE;
THENCE (4) ALONG LAST SAID CENTER LINE SOUTH 55° 59' 02" WEST, 5.58 FEET TO
THE POINT OF BEGINNING.
PARCEL A-1:
AN EASEMENT FOR MAlNT AIN ING A WATER PIPELINE OVER THE
NORTHEASTERLY 3 FEET OF THE SOUTHEASTERLY 240 FEET OF THAT PORTION
OF LOT l OF THE SUBDIVISION OF TRACTS 11 4 AND 120 OF CARLSBAD LAND, IN
THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP
THEREOF NO. 1744, FI LED lN THE OFFICE OF THE COUNTY RECORDER OF SAN
DIEGO COUNTY, JANUARY 3, 1923, DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT OF THE CENTER LINE OF OAK A VENUE, DISTANT
THEREON NORTH 55° 27' EAST 469.95 FEET FROM ITS INTERSECTION WITH THE
CENTER LINE OF FIFTH STREET THENCE CONTINUING ALONG THE SAID CENTER
LINE OF OAK AVENUE, NORTH 56° 27' EAST, A DISTANCE OF 90 FEET TO THE
NORTHWESTERLY CORNER OF THAT TRACT OF LAND AS CONVEYED BY THE
SOUTH COAST LAND COMPANY TO ROBERT W. AND MARYE. CHAMBERS, BY
DEED DATED APRIL 13, 1925 AND RECORDED IN BOOK 1095, PAGE 20 OF DEEDS;
THENCE ALONG THE SOUTHWESTERLY LINE OF SAID CHAMBERS LAND, SOUTH
34° 33' EAST, A DISTANCE OF 480 FEET TO A POINT ON THE CENTER LINE OF PINE
A VENUE; THENCE ALONG THE SAID CENTER LINE OF PINE A VENUE SOUTH 55° 27'
WEST, A DISTANCE OF 90 FEET; THENCE NORTH 34° 33' WEST A DISTANCE OF 480
FEET TO A POINT OF BEGINNING.
APN: 204-I 11 -02-00
PARCEL B:
THAT PORTION OF LOTS 3 AND 4 IN BLOCK "B" PER MAP OF RESUBDJVISION OF A
PORTION OF ALLES AVOCADO ACRES, IN THE CITY OF CARLSBAD, COUNTY OF
SAN DIEGO, STATE OF CALIFORNIA, COUNTY OF SAN DIEGO, STATE OF
CALIFORNIA, ACCORDING TO MAP THEREOF NO. 2027, FILED IN THE OFFICE OF
THE COUNTY RECORDER OF SAN DIEGO COUNTY, MAY 17, 1927, AS DESCRIBED IN
GRANT DEED RECORDED OCTOBER 3 1, 201 8 AS DOCUMENT NO. 2018-0455093 OF
OFFICIAL RECORDS, TOGETHER WITH THAT PORTION OF SAID LOT 4 IN BLOCK
"B" OF MAP NO. 2027, AS DESCRI BED IN GRANT DEED RECORDED DEC EMBER 22,
2016 AS DOCUMENT NO. 2016-0703741 OF OFFfCIAL RECORDS, MORE
PARTICULARLY DESCRIBED AS FOLLOWS:
COMMENCING AT THE NORTHWEST CORNER OF LOT 6 IN SAID BLOCK "B" OF
MAP NO. 2027; THENCE ALONG THE NORTHEASTERLY 30.00 FOOT HALF-WIDTH
SIDELINE OF HARDING STREET (FORMERLY 5TH STREET) DEDICATED PER SAID
MAP NO. 2027, SOUTH 28°06'37" EAST, 190.4 1 FEET TO THE NORTHWEST CORNER
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OF SAID PORTION OF LOT 4 DESCRIBED rN GRANT DEED DOCUMENT NO. 2016-
0703741, SAID CORNER BETNG THE TRUE POINT OF BEGINNING; THENCE ALONG
THE NORTHWESTERLY LINE OF SAID PORTION OF LOT 4 DESCRIBED IN GRANT
DEED DOCUMENT NO. 20 16-0703741, NORTH 6 1°53 '49" EAST, 187.86 FEET TO THE
NORTHEASTERLY LINE OF SAID LOT 4; THENCE ALONG SAID NORTHEASTERLY
LINE OF LOT 4, SOUTH 28°06'50" EAST, 74.27 FEET TO THE SOUTHWESTERLY
RIGHT-OF-WAY OF INTERSTATE 5 GRANTED TO THE STATE OF CALIFORNIA PER
DEED RECORDED FEBRUARY 7, 1967 AS INSTRUMENT NO. 16496 OF OFFICIAL
RECORDS; THENCE ALONG SAID SOUTHWESTERLY RIGHT-OF-WAY THE
FOLLOWING TWO (2) COURSES; SOUTH 22°4 l '27" EAST, 18.28 FEET; THENCE SOUTH
18°34'38" EAST, 34.91 FEET TO THE SOUTHEASTERLY LINE OF SAID PORTION OF
LOTS 3 AND 4 DESCRIBED IN GRANT DEED DOCUMENT NO. 2018-0455093; THENCE
SOUTH 61 °53'44" WEST, 180.36 FEET ALONG SAID SOUTHEASTERLY LINE TO
PREVIOUSLY DESCRIBED NORTHEASTERLY 30.00 FOOT HALF-WIDTH SIDELINE OF
HARDING STREET; THENCE NORTH 28°06'37" WEST, 126.91 FEET ALONG SAID
SIDELINE TO THE TRUE POINT OF BEGlNNING.
APN: 204-192-05-00 A ND 204-192-06-00
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OAK Avenue
G0.0.2
G0.1.18
G0.1 B1
G0.182
G0.2.1
G0.2.2
G0.2.3
G0.2.4
G0.2.5
G0.2.7
G0.4.1
G0.4.2
G0.4.3
G0.4.4
G1.2
G1.2B
G2.2
G2.2.1
G2.2.2
G2.2.3
G2.2.5
G3.1.1
G3.1.2
G3.2.1
G3.2.2
G3.2.3
G3.2.4
G3.2.5
G4.1.1
G4.2.1
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EXHIBI'I'B
LIST OF CONSTRUCTION PLANS
Title Sheet
Symbols & Abbreviations
Conditions of Approval
Conditions of Approval
CalGreen Requirements
CalGreen Requirements
CalGreen Requirements
CalGreen Requirements
CalGreen Requirtements
Green Point Rated Score Sheet
Title 24 Residential
Title 24 Residential
Title 24 Residential
Title 24 Residential
Building Data
Building Data
Acoustical & Fire Penetration Notes and Details
Occupancy & Code Analysis -Ground Floor
Occupancy & Code Analysis -Second Floor
Occupancy & Code Analysis -Third Floor
Mobility and Communication Distribution
Wall Assembly Schedule
Rated Wall Sections
Tested Wall and Horizontal Assemblies
Penetration Firestops
Fire Assembly and Penetration Details
Fire Assembly and Penetration Details
Fire Assembly and Penetration Details
Site Accessibility Notes and Diagrams
Residential Accessibility Notes and Diagrams
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G4.3.1 Accessibility Notes and Diagrams 6.10.2020
G4.3.2 Accessibility Notes and Diagrams 6.10.2020
G4.3.4 Accessibility Notes and Diagrams 6.10.2020
G4.3.5 Accessibility Notes 6.10.2020
A0.2. Site Plan 6.10.2020
A2.2.01 Slab Plan 6.10.2020
A2.2.1 .1 Ground Floor Dimension Plan 6.10.2020
A2.2.1.2 Ground Floor Annotation Plan 6.10.2020
A2.2.02 Podium Slab Plan 6.10.2020
A2.2.2.1 Second Floor Dimension Plan 6.10.2020
A2.2.2.2 Second Floor Annotation Plan 6.10.2020
A2.2.3.1 Third Floor Dimension Plan 6.10.2020
A2.2.3.2 Third Floor Annotation Plan 6.10.2020
A2.2.4.1 Ground Floor RCP 6.10.2020
A2.2.4.2 Second Floor RCP 6.10.2020
A2.2.4.3 Third Floor RCP 6.10.2020
A2.2.5 Roof Plan 6.10.2020
A2.2.6.1 Enlarged Plans 6.10.2020
A2.9.A1 Unit Plan -Type A -Studio -Typical 6.10.2020
A2.9.A.2 Unit Balcony Plan -Type A 6.10.2020
A2.9.B1 Unit Plan -Type 81 -1 Bedroom -Typical 6.10.2020
A2.9.C1 Unit Plan -Type C1 -2 Bedroom -Typical 6.10.2020
A2.9.C3 Unit Plan -Type C2 -2 Bedroom -Manager's Unit 6.10.2020
AS.2.11 Exterior Elevations -North & West 6.10.2020
AS.2.1 .2 Exterior Elevations -South & East 6.10.2020
AS.2.2.1 Exterior Color Elevations -North & West 6.10.2020
AS.2.2.2 Exterior Color Elevations -South & East 6.10.2020
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A6.2.1 Building Sections 6.10.2020
A6.2.2 Wall Sections 6.10.2020
A6.2 .3A Stair 81 and Elevator B Sections and Plans 6.10.2020
A6.2.3B Stair 82-Section and Plans and Trash B Section 6.10.2020
A?.1.2 Door Schedule 6.10.2020
A?.2.2 Window Schedule 6.1 0.2020
A9.1 .1 Architectural Details/Wall Sill Plates 6.10.2020
A9.2.1 Architectural Details/Concrete Tile Roof 6.10.2020
A9.2.2 Architectural Details/TPO Roof 6.10.2020
A9.3.1 Architectural Details/Windows 6.10.2020
A9.4.1 Architectural Details/Doors 6.10.2020
A9.5.1 Architectural Details/Stair and Elevator 6.10.2020
A9.6.1 Architectural Details/Balcony and Exterior Details 6.10.2 020
A9.7.1 Architectural Details/Storefront and Exterior Details 6.10.2020
A9.8.1 Architectural Details/Interior Details 6.10.2020
Sheet 1of 8 Title Sheet
Sheet 2 of 8 Existing Conditions
Sheet 3 of 8 Surface Improvements
Sheet 4 of 8 BMP Treatment
Sheet 5 of 8 Public Improvement Notes and Details
Sheet 6 of 8 Public Improvement Plan
Sheet 7 of 8 Tier2 SWPPP
Sheet 8 of 8 Tier 2 SWPPP Erosion Control Plan
S1.0 Foundation Plan 6.10.2020
S1 .1A Transfer Slab Reinforcing Plan 6.10.2020
S1 .18 Transfer Slab Post Tension Plan 6.10.2020
S1 .1C Transfer Slab Interface Plan 6.10.2020
S1.2 3rd Floor Framing Plan (Level 2) 6.10.2020
S1.3 Roof Framing Plan (Level 3) 6.10.2020
SD.1 Structural Details Concrete 6.10.2020
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SD.2 Structural Details Concrete 6.10.2020
SD.3 Structural Details Concrete 6.10.2020
SD.3A Structural Details Concrete 6.10.2020
SD.4 Structural Details Concrete 6.10.2020
SD.5 Structural Details Superstructure 6.10.2020
SD.6 Structural Details Superstructure 6.10.2020
SD.7 Structural Details Superstructure 6.10.2020
SD.8 Structural Details Superstructure 6.10.2020
SD.9 Structural Details Superstructure 6.10.2020
SN.1 Standard Notes 6.10.2020
SN.1A Standard Notes 6.10.2020
SN.2 Standard Details 6.10.2020
SN.3 Standard Details 6.10.2020
MO.O Mechanical Lead Sheet 6.10.2020
M0.1 Mechanical Equipment Schedules 6.10.2020
M2.2.1.1 Mechanical Ground Floor Plan 6.10.2020
M2.2.2.1 Mechanical Second Floor Plan 6.10.2020
M2.2.3.1 Mechanical Third Floor Plan 6.10.2020
M2.2.4 Mechanical Roof Plan 6.10.2020
M2.9.1 Mechanical Unit Plans 6.10.2020
MS.O Mechanical Details 6.10.2020
M5.1 Mechanical Details 6.10.2020
E01 .0.2 General Notes, Legend and Fixture Schedule 6.10.2020
E-1 .1.2 Electrical Site Plan 6.10.2020
E-2.0.2 Ground Floor Electrica l Plan 6.10.2020
E-2.1.2 Second Floor Electrical Plan 6.10.2020
E-2.2.2 Third Floor Electrical Plan 6.10.2020
E2.3.2 Roof Floor Electrical Plan 6.10.2020
E2.4.2 Third Floor Electrical Plan 6.10.2020
E-3.0.2 Third Floor Electrical Plan 6.10.2020
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E-4.0.2 Electrical Control and Main Utility Details 6.10.2020
E-5.0.2 Panel Schedules 6.10.2020
E-5.1 .2 Panel Schedules and Load Calculations 6.10.2020
E-6.0.2 One Line Diagram 6.10.2020
E-7.0.1 Title 24 Indoor 6.10.2020
E-7.1.1 Title 24 Indoor 6.10.2020
E-7.2.1 Title 24 Outdoor 6.10.2020
E-7 .3.1 Title 24 Outdoor 6.10.2020
PO.O Plumbing Lead Sheet 6.10.2020
P0.1 Plumbing Calculations 6.10.2020
P0.2 Plumbing Equipment and Fixture Schedule 6.10.2020
P0.3 Plumbing Details 6.10.2020
P0.4 Plumbing Details 6.10.2020
P0.5 Plumbing Details 6.10.2020
P1 .2.0 Site Plumbing Plan 6.10.2020
P2.2.1.1-A Ground Floor Plumbing Plan 6.10.2020
P2.2.1.1-B Ground Floor Plumbing Plan 6.10.2020
P2.2.2.1 Second Floor Plumbing Plan 6.10.2020
P2.2.3.1 Third Floor Plumbing Plan 6.10.2020
P2.2.4.1 Roof Plumbing Plan 6.10.2020
P2.9.A Enlarged Units (A 1) Plumbing Plan 6.10.2020
P2.9.B Enlarged Units (81) Plumbing Plan 6.10.2020
P2 .9.C Enlarged Units (C1 and C3) Plumbing Plan 6.10.2020
PS.1 Units Cold and Hot Water Riser Diagram 6.10.2020
P5.2 Building Cold and Hot Water Riser Diagrams 6.10.2020
P6.1 Waste and Vent Riser Diagrams 6.10.2020
P6.2 Waste and Vent Riser Diagrams 6.10.2020
P6.3 Waste and Vent Riser Diagrams 6.10.2020
P7.1 Gas Riser Diagrams 6.10.2020
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Updated Geotechnical Report, Oak Avenue. Nova Engineering. Dated January 17, 2020.
Hazardous Building Materials Survey, Oak Avenue. Advantage Environmental Consultants, LLC. Dated
July 23, 2020.
Harding
Street
G0.0.1 Title Sheet 6.10.2020
G0.1.1A Symbols & Abbreviations 6.10.2020
G0.1A1 Conditions of Approval 6.10.2020
G0.1A2 Conditions of Approval 6.10.2020
G0.2.1 CalGreen Requirements 6.10.2020
G0.2.2 CalGreen Requirements 6.10.2020
G0.2.3 CalGreen Requirements 6.10.2020
G0.2.4 CalGreen Requirements 6.10.2020
G0.2.5 CalGreen Requirtements 6.10.2020
G0.2.6 Green Point Rated Score Sheet 6.10.2020
G0.3.1 Title 24 Residential 6.10.2020
G0.3.1 Title 24 Residential 6.10.2020
G0.3.3 Title 24 Residential 6.10.2020
G0.3.4 Title 24 Residential 6.10.2020
G1 .1 Building Data 6.10.2020
G1.2A Building Data 6.10.2020
G2.2.1 Occupancy & Code Analysis -Ground Floor 6.10.2020
G2.1.2 Occupancy & Code Analysis -Second Floor 6.10.2020
G2.1.3 Occupancy & Code Analysis -Third Floor 6.10.2020
G2 .2 Acoustical & Fire Penetration Notes and Details 6.10.2020
G2.2.4 Mobility and Communication Distribution 6.10.2020
G3.1 .1 Wall Assembly Schedule 6.10.2020
G3 .1.2 Rated Wall Sections 6.10.2020
G3.2.1 Tested Wall and Horizontal Assemblies 6.10.2020
G3 .2.2 Penetration Firestops 6.10.2020
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G3.2.3 Fire Assembly and Penetration Details 6.10.2020
G3.2.4 Fire Assembly and Penetration Details 6.10 .2020
G3.2.5 Fire Assembly and Penetration Details 6.10.2020
G4.1.1 Site Accessibility Notes and Diagrams 6.10.2020
G4.2.1 Residential Accessibility Notes and Diagrams 6.10.2020
G4.3.1 Accessibility Notes and Diagrams 6.10.2020
G4.3.2 Accessibility Notes and Diagrams 6.10.2020
G4.3.4 Accessibility Notes and Diagrams 6.10.2020
G4.3.5 Accessibility Notes 6.10.2020
A0.1 Site Plan 6.10.2020
A2.1.01 Slab Plan 6.10.2020
A2.1.1.1 Ground Floor Dimension Plan 6.10.2020
A2.1.1.2 Ground Floor Annotation Plan 6.10.2020
A2.1.02 Podium Slab Plan 6.10.2020
A2.1.2.1 Second Floor Dimension Plan 6.10.2020
A2.1.2.2 Second Floor Annotation Plan 6.10.2020
A2.1.3 .1 Third Floor Dimension Plan 6.10.2020
A2.1.3.2 Third Floor Annotation Plan 6.10.2020
A2.1.4.1 Ground Floor RCP 6.10.2020
A2.1.4.2 Second Floor RCP 6.10.2020
A2.1.4.3 Third Floor RCP 6.10.2020
A2.1.5 Roof Plan 6.10.2020
A2.1.6.1 Enlarged Plans 6.10.2020
A2.9.A.1 Unit Plan -Type A -Studio -Typical 6.10.2020
A2.9.B.1 Unit Plan -Type 81 - 1 Bedroom -Typical 6.10.2(30
A2.9.B2 Unit Plan -Type 81 - 1 Bedroom -Variation 6.10.2020
A2.9.B3 Unit Plan -Type 82 -1 Bedroom 6.10.2020
A2.9 .C1 Unit Plan -Type C1 - 2 Bedroom -Typical 6.10.2020
A2.9.C2 Unit Plan -Type C2 - 2 Bedroom -Manager's Unit 6.10.2020
A2.9.C.1 Unit Balcony Plan -Type C 6.10.2020
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A2.9.D Unit Plan -Type D -3 Bedroom 6.10.2020
AS.1.1.1 Exterior Elevations -North & West 6.10.2020
AS.1.1 .2 Exterior Elevations -South & East 6.10.2020
AS.1 .2.1 Exterior Color Elevations -North & West 6.10.2020
AS.1.2.2 Exterior Color Elevations -South & East 6.10.2020
A6.1 .1 Building Sections 6.10.2020
A6.1 .2.1 Wall Sections 6.10.2020
A6.1.2.2 Wall Sections 6.10.2020
A6.1.3A Stair A 1 Section and Plans 6.10.2020
A6.1.3B Stair A2 and Elevator A Section and Plans 6.10.2020
A7.1.1 Door Schedule 6.10.2020
A7.2.1 Window Schedule 6.10.2020
AB.1.1 Interior Elevation Common Areas 6.10.2020
A9.1.1 Architectural Details/Wall Sill Plates 6.10.2020
A9.2.1 Architectural Details/Concrete Tile Roof 6.10.2020
A9.2.2 Architectural Details/TPO Roof 6.10.2020
A9.3.1 Architectural Details/Windows 6.10.2020
A9.4.1 Architectural Details/Doors 6.10.2020
A9.5.1 Architectural Details/Stair and Elevator 6.10.2020
A9.6.1 Architectural Details/Balcony and Exterior Details 6.10.2020
A9.7.1 Architectural Details/Storefront and Exterior Details 6.10.2020
A9.8.1 Architectural Details/Interior Details 6.10.2020
Sheet1 of8 Title Sheet
Sheet2of8 Existing Conditions
Sheet3of8 Grading Plan
Sheet4of8 Post Construction BMP Plan
Sheet5of8 Public Improvement Notes and Details
Sheet6of8 Public Improvement Plan
Sheet7of8 Tier2 SWPPP
Sheet8of8 Tier 2 SWPPP Erosion Control Plan
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S1.0 Foundation Plan 6.10.2020
S1.1A Transfer Slab Reinforcing Plan 6.10.2020
S1 .1B Transfer Slab Post Tension Plan 6.10.2020
S1 .1C Transfer Slab Interface Plan 6.10.2020
S1 .2 3rd Floor Framing Plan (Level 2) 6.10.2020
S1.3 Roof Framing Plan (Level 3) 6.10.2020
SD.1 Structural Details Concrete 6.10.2020
SD.2 Structural Details Concrete 6.10.2020
SD.3 Structural Details Concrete 6.10.2020
SD.3A Structural Details Concrete 6.10.2020
SD.4 Structural Details Concrete 6.10.2020
SD.5 Structural Details Superstructure 6.10.2020
SD.6 Structural Details Superstructure 6.10.2020
SD.7 Structural Details Superstructure 6.10.2020
SD.8 Structural Details Superstructure 6.10.2020
SD.9 Structural Details Superstructure 6.10.2020
SN.1 Standard Notes 6.10.2020
SN.1A Standard Notes 6.10.2020
SN.2 Standard Details 6.10.2020
SN.3 Standard Details 6.10.2020
MO.O Mechanical Lead Sheet 6.10.2020
M0.1 Mechanical Equipment Schedules 6.10.2020
M2.1.1.1 Mechanical Ground Floor Plan 6.10.2020
M2.1.2.1 Mechanical Second Floor Plan 6.10.2020
M2.1.3.1 Mechanical Third Floor Plan 6.10.2020
M2.1.4 Mechanical Roof Plan 6.10.2020
M2.9.A Mechanical Unit Plans 6.10.2020
M2.9.B Mechanical Unit Plans 6.10.2020
M2.9.C Mechanical Unit Plans 6.10.2020
M2.9.D Mechanical Unit Plans 6.10.2020
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MS.O Mechanical Details 6.10.2020
MS.1 Mechanical Details 6.10.2020
E01 .0.1 General Notes, Legend and Fixture Schedule 6.10.2020
E-1.1 .1 Electrical Site Plan 6.10.2020
E-2.0.1 Ground Floor Electrical Plan 6.10.2020
E-2.1.1 Second Floor Electrical Plan 6.10.2020
E-2.2.1 Third Floor Electrical Plan 6.10.2020
E-2.3.1 Roof Floor Electrical Plan 6.10.2020
E-2.4.1 Third Floor Electrical Plan 6.10.2020
E-3.0.1 Third Floor Electrical Plan 6.10.2020
E-4.0.1 Electrical Control and Main Utility Details 6.10.2020
E-5.0.1 Panel Schedules 6.10.2020
E-5.1 .1 Panel Schedules and Load Calculations 6.10.2020
E-6.0.1 One Line Diagram 6.10.2020
E-7.0.1 Title 24 Indoor 6.10.2020
E-7.1.1 Title 24 Indoor 6.10.2020
E-7.2.1 Title 24 Outdoor 6.10.2020
E-7.3.1 Title 24 Outdoor 6.10.2020
PO.O Plumbing Lead Sheet 6.10.2020
P0.1 Plumbing Calculations 6.10.2020
P0.2 Plumbing Equipment and Fixture Schedule 6.10.2020
P0.3 Plumbing Details 6.10.2020
P0.4 Plumbing Details 6.10.2020
P0.5 Plumbing Details 6.10.2020
P1 .1.0 Site Plumbing Plan 6.10.2020
P2.2.1.1-A Ground Floor Plumbing Plan 6.10.2020
P2.2.1 .1-B Ground Floor Plumbing Plan 6.10.2020
P2.1 .2.1 Second Floor Plumbing Plan 6.10.2020
P2.1 .3.1 Third Floor Plumbing Plan 6.10.2020
P2.1.4.1 Roof Plumbing Plan 6.10.2020
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P2.9.A Enlarged Units (A 1) Plumbing Plan 6.10.2020
P2.9.B Enlarged Units (81) Plumbing Plan 6.10.2020
P2.9.C Enlarged Units (C1 and C3) Plumbing Plan 6.10.2020
P2.9.D Enlarged Units (01) Plumbing Plan 6.10.2020
PS.1 Units Cold and Hot Water Riser Diagram 6.10.2020
PS.2 Building Cold and Hot Water Riser Diagrams 6.10.2020
P6.1 Waste and Vent Riser Diagrams 6.10.2020
P6.2 Waste and Vent Riser Diagrams 6.10.2020
P6.3 Waste and Vent Riser Diagrams 6.10.2020
P7.1 Gas Riser Diagrams 6.10.2020
Updated Geotechnical Report, Harding Street. Nova Engineering. Dated January 16, 2020.
Hazardous Building Materials Survey, Harding Street. Advantage Environmental Consultants, LLC. Dated
July 23, 2020.
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EXHIBIT C
MEMORANDUM OF LEASE
RECORDING REQUESTED BY
AND WHEN RECORDED MA[L TO:
City of Carlsbad
Community Development Department
Housing Services
1200 Carlsbad Village Drive
Carlsbad, CA 92008
Attn: City Clerk
This document is recorded at the request and for the benefit of the City of Carlsbad, and is
exempt from the payment of a recording fee pursuant to Government Code Sections 6103,
27383, and 27388.1
(SPACE ABOVE THIS LINE FOR RECORDER'S USE)
MEMORANDUM OF GROUND LEASE AGREEMENT
THIS MEMORANDUM OF GROUND LEASE AGREEMENT (this "Memorandum") is
made as of September_, 2020 (the "Effective Date") by and between the City of Carlsbad, a
municipal corporation ("Landlord"), and, Carlsbad Veteran Housing, L.P., a Californ ia limited
partnership ("Tenant"), with respect to that certain Ground Lease Agreement dated September
_, 2020 (the "Ground Lease"), between Landlord and Tenant.
Pursuant to the Ground Lease, Landlord demises and leases to Tenant, and Tenant leases
from Landlord, that certain real property, more particularly described in Exhibit A, attached
hereto and incorporated herein (the "Property"), for the term of the Ground Lease. The Ground
Lease commenced on the Effective Date, and shall end on the earlier to occur of: (I) the ninety-
ninth (99th) anniversary of the Effective Date; or (2) the date of any termination of the Ground
Lease in accordance with the provisions thereof.
This Memorandum shall incorporate herein all of the terms and provisions of the Ground
Lease as though fully set forth herein.
This Memorandum may be executed in multiple originals, each or which is deemed to be
an original, and may be signed in counterparts.
This Memorandum is solely for recording purposes and shall not be construed to alter,
modify, amend or supplement the Ground Lease of which this is a memorandum.
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IN WITNESS WHEREOF, the parties have caused this Memorandum to be duly
executed as of the date first above written.
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CTTY:
CITY OF CARLSBAD, a municipal corporation
By:
Geoff Patnoe, Assistant City Manager
APPROVED AS TO FORM AND LEGALITY
By:
CYNDIE K. MCMAHON
Assistant City Attorney
TENANT:
CARLSBAD VETERAN HOUSING, L.P., a
California limited partnership
By: AHG Windsor Pointe, LLC, a California
limited liability company, its Administrative
General Partner
By: Affirmed Housing Group, Tnc., a
Delaware corporation, its Manager
By:
James Silverwood, President
By: Las Palmas Foundation, a California non-
profit public benefit corporation, its
Managing General Partner
By:
Joseph M. Michaels, President
C-2
EXIIJJlITD
INSURANCE REQUIREMENTS
(a) Tenant Requirements During Term. Tenant shall maintain the following insurance
coverage for the Development throughout the Term of the Ground Lease:
(l) Commercial General Liability insurance, with limits no less than One Million
Dollars ($1 ,000,000) combined single limit per occurrence and Two Million
Dollars ($2,000,000) annual aggregate limit for bodily injury and property
damage, including coverage for contractual liability; personal injury; fire damage
legal liability; advertisers' liability; owners' and contractors' protective liability;
products and completed operati ons; broad form property damage; and explosion,
collapse and underground (XCU) coverage during any period in which Tenant is
conducting any activity on, alteration or improvement to the Development with
risk of explosions, collapse, or underground hazard.
(2) Umbrella Liability coverage in amount of not less than Five Million Dollars
($5,000,000).
(3) To the extent the Tenant utilizes automobiles, commercial Automobile Liability
insurance, with limits not less than One Million Dollars ($1 ,000,000) each
occurrence, combined single limit for bodily injury and property damage,
including owned, hired and non-owned auto coverage, as applicable.
(4) To the extent Tenant has "employees" as defined in the California Labor Code,
Workers' Compensation insurance meeting statutory requirements with
employer's liability limits not less than One Million Dollars ($1,000,000) each
accident, injury or illness.
(b) Tenant Requirements During Construction. Tenant shall maintain the fo llowing
insurance coverage for the Development during the course of construction:
(I) Property and/or Builder's ri sk insurance, special form coverage, excluding
earthquake and flood, for one hundred percent (100%) of the replacement value of
a ll completed improvements and property in the care, custody and control of the
Tenant or its contractor, including coverage in transit and storage off-site; the cost
of debris removal and demolition as may be made reasonably necessary by such
covered perils, resulting damage and any applicable law, ordinance or regulation;
start up, testing and machinery breakdown including electrical arcing, copy of the
applicable endorsement to the Builder's Risk policy, if the Builder's Risk policy is
issuel on a declared-project basis; and with a deductible not to exceed Fifty
Thousand Dollars ($50,000) each loss, with the exception of water damage which
shat I not exceed One Hundred Thousand Dollars ($100,000) each loss. The pol icy
shall provide for no deduction for depreciation.
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(c) Tenant Requirements After Construction. Tenant shall maintain the following insurance
coverage for the Development upon completion of construction:
(I) Property in surance, excluding earthquake and flood, in the amount no less than
one hundred percent (I 00%) of the replacement value of all completed
improvements and property in the care, custody and control of the Tenant or its
contractor. For rehabilitation/construction projects that are unoccupied by
residential or commercial tenants, tenants must obtain property insurance by the
date that the project receives a certificate of substantial completion.
(2) Boiler and machinery insurance, comprehensive form, covering damage to, loss
or destruction of machinery and equipment located on the Development that is
used by Tenant for heating, ventilating, air-conditioning, power generation and
similar purposes, in an amount not less than one hundred percent (100%) of the
actual replacement value of such machinery and equipment with a deductible not
to exceed Fifty Thousand Dollars ($50,000) each loss.
(d) General Requirements.
(1) General Liability and Automobile Liability policies of Tenant must include the
Landlord, and its councilmembers, commissioners, officers, directors, employees,
agents, successors and assigns, as additional insureds by endorsement.
(2) Tenant shall provide thirty (30) days advance written notice to the Landlord of
cancellation, intended non-renewal, or reduction in coverages, except for non-
payment for which no less than ten ( I 0) days' notice shall be provided to
Landlord. Notices shall be sent to the Landlord at the address set forth in Section
14.1.
(3) With respect to any Property insurance, Tenant hereby waives all rights of
subrogation against the Landlord to the extent of any loss covered by Tenant's
insurance, except to the extent subrogation would affect the scope or validity of
insurance.
(4) Approval of Tenant's insurance by the Landlord will not relieve or decrease the
liability of Tenant under this Ground Lease.
(5) Landlord reserves the right to require an increase in insurance coverage in the
event the Landlord reasonably determines that conditions show cause for an
increase, unless Tenant demonstrates to the Landlord's reasonable satisfaction that
the increased coverage is commercially unreasonable and unavailable to Tenant;
provided, however, such right shall only be exercised fo ll owing written notice to
the Tenant, and the Tenant shall have ninety (90) days to obtain such increased
coverage, and, provided, further, the Landlord shall not exercise such right more
than once every calendar year.
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101012612824202.8
•
(6) All liability policies must provide that the insurance is primary to any other
insurance available to the additional insureds with respect to claims arising out of
this Ground Lease, and that insurance applies separately to each insured against
whom claim is made or suit is brought and that an act of omission of one of the
named insureds that would void or otherwise reduce coverage will not void or
reduce coverage as to any other insured, but the inclusion of more than one
insured will not operate to increase the insurer's limit of liability.
(7) Unless otherwise waived by the Landlord, for the commercial general liability
policy, any policy in a form of coverage that includes a general annual aggregate
limit or provides that claims investigation or legal defense costs are included in
the general annual aggregate limit must be in amounts that are double the
occurrence or claims limits specified above.
(8) All claims based on acts, omissions, injury or damage occurring or arising in
whole or in part during the policy period must be covered. If any required
insurance is provided under a claims-made policy, coverage must be maintained
continuously for a period ending no less than three (3) years after recordation of a
notice of completion.
(9) If requested, Tenant must provide the Landlord with copies of endorsements for
each required insurance policy and make each policy available for inspection and
copying promptly upon request.
( I 0) Risk and hazardous insurance policies set forth above shall be from an insurance
company with a rating deemed acceptable by Landlord. Upon request from
Landlord, Tenant shall deliver certificates of insurance (ACCORD 25) evidencing
all policies set forth above.
(e) General Contractor and Subcontractor Requirements. Tenant shall cause any general
contractor, agent, or subcontractor working on the Development under direct contract with
Tenant or a subcontract with the general contractor to maintain insurance of the types and in at
least the minimum amounts described in subsection (a)(l)-(4) above, except that Landlord has
waived the umbrella coverage requirement for any general contractor, agent, or subcontractor,
and the limit of liability for commercial general liability insurance for subcontractors must be
One Million Dollars ($1 ,000,000).
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