HomeMy WebLinkAbout1994-09-06; Housing & Redevelopment Commission; 258 Exhibit 5; Family Housing Revenue Refunding BondsEXHIBIT 5
RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:
KAREN A. ELLIS, ESQ.
STRADLING, YOCCA, CARLSON & RAUTH
660 Newport Center Drive, Suite 1600
Newport Beach, California 92660
REDLINED 8/H/94
AMENDED AND RESTATED
REGULATORY AGREEMENT
AND DECLARATION OF RESTRICTIVE COVENANTS
By and Among
CARLSBAD HOUSING AND REDEVELOPMENT COMMISSION
and
FIRST TRUST OF CALIFORNIA, NATIONAL ASSOCIATION,
as Trustee
and
SEASCAPE APARTMENTS, INC.,
an Illinois corporation
DATED AS OF SEPTEMBER 1, 1994
Relating to
^ $15.115.000
CARLSBAD HOUSING AND REDEVELOPMENT COMMISSION
2. MULTIFAMILY HOUSING REVENUE REFUNDING BONDS
SERIES A OF 1994
(SEASCAPE VILLAGE PROJECT)
TABLE OF CONTENTS
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DEFINITIONS AND INTERPRETATION .......................... 2
ACQUISITION, CONSTRUCTION, EQUIPPING AND COMPLETION OF
THEPROJECT ........................................... 5
RESIDENTIAL RENTAL PROPERTY ............................. 6
LOWER-INCOME TENANTS .................................. 7
TAX EXEMPT STATUS OF THE BONDS .......................... 9
MODIFICATION OF SPECIAL TAX COVENANTS ................... 10
INDEMNIFICATION ...................................... 10
CONSIDERATION ....................................... 2a
RELIANCE ............................................. 12
PROJECT LOCATION ...................................... 12
SALE OR TRANSFER OF THE PROJECT ......................... 12
TERM ................................................ 13
BURDEN AND BENEFIT ................................... 14
ENFORCEMENT ......................................... 14
RECORDING AND FILING .................................. 15
PAYMENTOFFEES ...................................... 15
GOVERNINGLAW ....................................... 15
AMENDMENTS .......................................... 15
NOTICE .............................................. 116
SEVERABILITY .......................................... 16
MULTIPLE COUNTERPARTS ................................ 16
24. TRUSTEE LIABILITY ..................................... 16
25. LIMITED RECOURSE PROVISIONS ........................... 17
Exhibit A LEGAL DESCRIPTION
Exhibit B CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE
Exhibit C INCOME COMPUTATION AND CERTIFICATION
PUBL:l7495~1(RED:17477~2~~o:~l7477~1)109~ B2062.14 i OS/ 11 I94
AMENDED AND RESTATED
REGULATORY AGREEMENT AND
DECLARATION OF RESTRICTIVE COVENANTS
THIS AMENDED AND RESTATED REGULATORY AGREEMENT AND
DECLARATION OF RESTRICTIVE COVENANTS (the “Regulatory Agreement”) is made and
entered into as of September 1, 1994, by and among CARLSBAD HOUSING AND
REDEVELOPMENT COMMISSION, a public body corporate and politic organized and existing
under the Constitution and laws of the State of California (together with any successor to its
rights, duties and obligations, the “Commission”), FIRST TRUST OF CALIFORNIA,
NATIONAL ASSOCIATION, a national banking association organized and existing under the
laws of the United States authorized to accept and execute trusts of the type contemplated by the
Indenture (as hereinafter defined), with its principal corporate trust office in San Francisco,
California, as Trustee (the “Trustee”), and SEASCAPE APARTMENTS, INC., an Illinois
corporation (the “Owner”).
WHEREAS, the Commission has adopted a program to finance the construction of
multifamily rental housing pursuant to Chapter 1 of Part 2 of Division 24 of the Health and
Safety Code of the State of California (the “Act”); and
WHEREAS, the Commission is a political subdivision (within the meaning of that
term in the Regulations of the Department of Treasury and the rulings of the Internal Revenue
Service prescribed and promulgated pursuant to the Internal Revenue Code of 1986, as amended
(the “Code”); and
WHEREAS, on May 7, 1985, the Board of the Commission adopted a resolution
(the “Resolution”) authorizing the issuance of revenue bonds in connection with the 20%unit
multifamily rental housing project 2 known as “Seawme Village” (the “Proiect”); and
WHEREAS, in furtherance of the purposes of the Act and the Resolution and as a
part of the Commission’s plan of financing residential rental housing, the Commission issued
$16,215,0 aggregate principal amount of its revenue bonds designated “Carlsbad Housing and
Redevelopment Commission Multifamily Housing Revenue Bonds, Series 1985 B (Seascape
Village Project)” (the “Prior Bonds”), secured by an Indenture of Trust dated as of April 1,
1985, between the Commission and The Bank of California, N.A., the predecessor in interest to
First Trust of California, National Association, as trustee for the Prior Bonds (the “Prior
Trustee”), the proceeds of which were loaned to Lincoln Seascape, A California Limited
Partnership (the “Developer”), the predecessor in interest to the Owner (the “Prior Loan”) to
finance the cost of 2 the Proiect for the public purpose of providing decent, safe and sanitary
housing; and
WHEREAS, the Owner has prepaid the Prior Loan, and the Commission has
issued fi its $15.115.000 Multifamilv Housiw Revenue Refunding Bonds, Series A of 1994
(Seascane Village Proiectl (the “Bonds”) to refund the Prior Bonds and make a mortgage loan
(the “Loan”) to the Owner to fi restructure the financing: for the Project; and
WHEREAS, the Commission has determined that the issuance of the Bonds 2 will
accomplish a valid public purpose of the Commission by assuring that housing continues to be
available to lower income persons and families within the meaning of the Act; and
WHEREAS, the Commission has determined that, in order to ensure continued
availability to lower income persons of at least 20% of the units in the Project, it is necessary to
enter into this Regulatory Agreement which amends and restates in its entirety that certain
Regulatory Agreement and Declaration of Restrictive Covenants dated as of April 1, 1985,
among the Commission, the Prior Trustee and the Developer recorded on May 21, 1985, as
Instrument No. 85-178037 in the Official Records of San Diego County, California (the “Prior
Regulatory Agreement”); and
WHEREAS, all things necessary to make the Bonds the valid, binding, and legal
special obligations of the Commission according to the import thereof, and to constitute the
Indenture as a valid assignment of the amounts pledged to the payment of the principal of,
premium, if any, and interest on the Bonds have been done and performed, and the creation,
execution, and delivery of the Indenture and the execution and issuance of the Bonds, subject to
the terms thereof, in all respects have been duly author&d; and
WHEREAS, the Code and the Internal Revenue Code of 1954, as amended (the
“Prior Code”) and the regulations and rulings promulgated with respect thereto and the Act
prescribe that the use and operation of the Project be restricted in certain respects and in order to
ensure that the Project will continue to be owned and operated in accordance with the Code, the
Prior Code and the Act, the Commission, the Trustee and the Owner have determined to enter
into this Regulatory Agreement in order to set forth certain terms and conditions relating to the
operation of the Project.
NOW, THEREFORE, in consideration of the mutual covenants and undertakings
set forth herein, and other good and valuable consideration, the receipt and sufficiency of which
hereby are acknowledged, the Commission, the Trustee and the Owner hereby agree to amend
the Prior Rewlatorv Aereement in its entiretv and restate the terms and Drovisions of the
Prior Regulatorv breement in its entirety as follows:
1. DEFINITIONS AND INTERPRETATION. The following terms shall have the
respective meanings assigned to them in this Section 1 unless the context in which they are used
clearly requires otherwise:
“Adjusted Income” - The adjusted income of a person (together with the adjusted
income of all persons of the age of 18 years or older who intend to reside with such person in
one residential unit) as calculated in the manner prescribed in Regulation Section 1.167(k)-3(b)(3)
in effect as of the 1 Closing Date.
“Affordable Rent” - A monthly rent which does not exceed 30 percent of
one-twelfth of 80% of Median Income for the Area, as adjusted for household size, and assuming
the following household sizes for the two types of residential units in the Project:
PUBL:17495~1(RKD:17477~2~~o:~17477_1)109~B2062.14 2 OS/l l/94
Residential Unit Number of Persons in Familv
One Bedroom
Two Bedroom
2
4
Such amount shall be further reduced by deducting tenant-paid utilities based on the “Utility Rate
Schedule” established for the Carlsbad Housing Authority’s Section 8 Rental Assistance Program.
Commencing September 113, 1995, in no event shall the monthly rent so determined exceed
90% of the 2 rent charged for a comparable market-rate unit in the Project.
“Area” - The San Diego, California Metropolitan Statistical Area.
“Certificate of Continuing Program Compliance” - The Certificate to be filed by
the Owner or the Proiect Manner on behalf of the Owner with the Commission, the Program
Administrator and the Trustee which shall be substantially in the form attached hereto as Exhibit
B.
“City” - The City of Carlsbad, California.
“Commission” - The Carlsbad Housing and Redevelopment Commission, and its
successors and assigns.
“Income Certification” - The Income Computation and Certification-attached
hereto as Exhibit C.
“Lower Income Units” - The dwelling units in the Project designated for
occupancy by Lower-Income Tenants pursuant to Section 4(a) of this Regulatory Agreement.
“Lower-Income Tenants” - Persons or families with an Adjusted Income which
does not exceed 80 percent of the Median Income for the Area, as adjusted for household size.
In no event will the occupants of a dwelling unit be considered to be Lower-Income Tenants if all
of such occupants are students (as defined in Section 151(e)(4) of the Code), no one of whom is
entitled to file a joint return under Section 6013 of the Code.
“Median Income for the Area” - The median income for the Area as most recently
determined by the Secretary of Housing and Urban Development under Section 8 of the United
States Housing Act of 1937, as amended, or, if programs under Section 8 are terminated, Median
Income for the Area determined under the method used by the Secretary prior to such
termination.
“Owner’s Use of Proceeds Certificate” - The certificate of the Owner, dated as of
the Closing Date, with respect to certain Project Costs delivered to the Commission by the
Owner.
“Project Costs” - To the extent authorized by the Prior Code, the Regulations and
the Act, any and all costs incurred with respect to the acquisition of land and the construction and
equipping, as the case may be, of the Project, including, without limitation, costs for site
preparation, the planning of housing and improvements, the acquisition of property, the removal
PUBL:1749~~1(RED:17477~2~T0:~17477_1)10962.14 3 08/11/94
or demolition of existing structures, the construction and purchase of housing, related facilities
and improvements, and all other work in connection therewith, and all costs of financing,
including, without limitation, the cost of consultant, accounting and legal services, other expenses
necessary or incident to determining the feasibility of the Project, contractors’ and developers’
overhead and supervisory fees and costs directly allocable to the Project, administrative and other
expenses necessary or incident to the Project and the financing thereof (including reimbursement
to any municipality, county or entity for expenditures made, with the approval of the
Commission, for the Project), interest allocable to the financing of the Project paid or incurred
prior to the Completion Date and all other costs approved by Bond Counsel.
“Project Facilities” - The buildings, structures and other improvements located on
the Project Site, and all fixtures and other property owned, leased or licensed by the Owner and
located on, or used in connection with, such buildings, structures and other improvements.
“Project Site” - The parcel or parcels of real property described in Exhibit “A”,
which is attached hereto and by this reference incorporated herein, and all rights and
appurtenances thereunto appertaining.
“Qualified Project Costs” - The Project Costs (i) incurred after December 18,
1984, the date of the first official action by the Commission declaring its intent to issue Bonds
for the Project, (ii) which are chargeable to a capital account with respect to the Project for
federal income tax and financial accounting purposes, or would be so chargeable either with a
proper election by the Owner or but for the proper election by the Owner to deduct those
amounts within the meaning of Regulation 1.103-8(a)(l)(i); provided, however, that only such
portion of the interest accrued prior to the Completion Date shall constitute a Qualified Project
Cost as bears the same ratio to all such interest as the Qualified Project Costs bear to all Project
Costs; and, provided further, that such interest shall cease to be a Qualified Project Cost on the
Completion Date; and, provided further, that if any portion of the Project has been constructed
by an Affiliated Party (whether as a general contractor or a subcontractor), “Qualified Project
Costs” shall include only the actual out-of-pocket costs incurred by such Affiliated Party in
constructing the Project (or any portion thereof).
“Qualified Project Period” - The period beginning on May 11, 1986, and ending
on the latest of (a) the date which is 10 years after the date on which at least 50 percent of the
dwelling units in the Project were first occupied (June 22, 1996), (b) the date which is a
Qualified Number of Days after the date on which any of the dwelling units in the Project was
first occupied (August 2 18. 1996), (c) the date on which any assistance provided with respect to
the Project under Section 8 of the United States Housing Act of 1937 terminates or (d) the date
on which no Bonds remain Outstanding. For purposes of clause (b), the term “Qualified Number
of Days” means, 50 percent of the number of days comprising the term from the date of issuance
of the Prior Bonds (May 21, 1985) until the final maturity of the Bonds (including any refunding
bonds).
“Regulatory Agreement” - This Amended and Restated Regulatory Agreement and
Declaration of Restrictive Covenants, together with any amendments or supplements hereof.
“Very Low Income Tenants” - Lower-Income Tenants whose Adjusted Income
does not exceed 50 percent of Median Income for the Area.
PUBL:17495~1(RED:17477_2_~0:_17477_1)1090fj2.14 4 OS/l 1194
Unless the context clearly requires otherwise, as used in this Regulatory
Agreement, words of the masculine, feminine or neuter gender shall be construed to include each
other gender when appropriate and words of the singular number shall be construed to include the
plural number, and vice versa, when appropriate. This Regulatory Agreement and all the terms
and provisions hereof shall be construed to effectuate the purposes set forth herein and to sustain
the validity hereof.
The defined terms used in the preamble and recitals of this Regulatory Agreement
have been included for convenience of reference only, and the meaning, construction and
interpretation of all defined terms shall be determined by reference to this Section 1
notwithstanding any contrary definition in the preamble or recitals hereof. The titles and
headings of the sections of this Regulatory Agreement have been inserted for convenience of
reference only, and are not to be considered a part hereof and shall not in any way modify or
restrict any of the terms or provisions hereof or be considered or given any effect in construing
this Regulatory Agreement or any provisions hereof or in ascertaining intent, if any question of
intent shall arise.
Capitalized terms used herein and not otherwise defined shall have the meanings
assigned to such terms in Appendix A to the Indenture of Trust dated as of the date hereof
between the Trustee and the Commission.
2. ACQUISITION, CONSTRUCTION, EQUIPPING AND COMPLETION OF
THE PROJECT. The Owner hereby represents, covenants and agrees as follows:
(a) 2 To the best of the Owner’s knowledge, within six months of the date
of issuance of the Prior Bonds, a substantial binding obligation was incurred to commence the
construction of the Project, pursuant to which the Developer was obligated to expend at least the
lesser of (i) 2-l/2% of the principal amount of the Prior Bonds or (ii) $100,000.
0) The statements made in the Owner’s Use of Proceeds Certificate are true
and correct.
(cl At all times since the 1 Owner acauired title to the Proiect, the Project
has been in compliance with the provisions of the Prior Regulatory Agreement.
60 Money on deposit in any fund or account in connection with the Prior
Bonds, whether or not such money was derived from other sources, shall not be used by or under
the direction of the Owner, in a manner which would cause the Prior Bonds or the Bonds to be
“arbitrage bonds” within the meaning of Section 148 of the Code, and the Owner specifically
agrees that the investment of money in any such fund shall be restricted as may be necessary to
prevent the Prior Bonds or the Bonds from being “arbitrage bonds” under the Code.
(e) The Owner (and any person related to it within the meaning of Section
147(a) of the Code) will not take or omit to take, as is applicable, any action if such action or
omission would in any way cause the proceeds from the sale of the Bonds to be applied in a
manner contrary to the requirements of the Indenture, the Loan Agreement or this Regulatory
Agreement.
PUBL:17495~1(RED:17477~2~~o:~l7477_1)1091 B2062.14 5 08/l 1 I94
3. RESIDENTIAL RENTAL PROPERTY. The Owner hereby acknowledges and
agrees that the Project is currently and will continue to be owned, managed and operated as a
project for “residential rental property” (within the meaning of Section 103(b)(4)(A) of the Prior
Code) for a term equal to the Qualified Project Period. To that end, and for the term of this
Regulatory Agreement, the Owner hereby represents, covenants, warrants and agrees as follows:
(a) The Project has been acquiredt bv the Owner for the purpose of
providing multifamily residential rental property, and the Owner shall own, manage and operate
the Project as a project to provide multifamily residential rental property comprised of a building
or structure or several interrelated buildings or structures, together with any functionally related
and subordinate facilities, and no other facilities, in accordance with Section 103(b)(4)(A) of the
Prior Code and Section 1.103-8(b) of the Regulations, and the Act, and in accordance with such
requirements as may be imposed thereby on the Project from time to time.
0) All of the dwelling units in the Project are and will remain similarly
constructed units, and each dwelling unit in the Project will contain complete separate and distinct
facilities for living, sleeping, eating, cooking and sanitation for a single person or a family,
including a sleeping area, bathing and sanitation facilities and cooking facilities equipped with a
cooking range, refrigerator and sink.
Cc) None of the dwelling units in the Project, from the date the Owner
acauired the Proiect, have been or will at any time be utilized on a transient basis, or will ever
be used as a hotel, motel, dormitory, fraternity house, sorority house, rooming house, nursing
home, hospital, sanitarium, rest home or trailer court or park.
Cd) No part of the Project, from the date the Owner acauired the Proiect,
has been or will at any time be owned or used as a cooperative housing corporation or a
community apartment project or a stock cooperative. Other than obtaining and recording a
condominium plan and map on the Project, and obtaining a white report from the California
Department of Real Estate, the Owner shall not take any steps in connection with a conversion to
such ownership or uses except with the prior written approving opinion of Bond Counsel
acceptable to the Commission and the Trustee, that the interest on the Bonds will not become
taxable thereby. The final subdivision map to be recorded for the Project shall state the
restriction against transferring individual condominium ownership interests in the Project during
the term of the Regulatory Agreement.
63 All of the dwelling units in the Project, from the date the Owner
acauired the Proiect, have been and will be available for rental on a continuous basis to
members of the general public. The Owner shall not discriminate on the basis of race, creed,
color, sex, age or national origin in the lease, use or occupancy of the Project or in connection
with the employment or the application for employment of persons for the operation and
management of the Project. The Owner will not give preference to any particular class or group
in renting the dwelling units in the Project, except to the extent that dwelling units are required to
be leased or rented to Lower-Income Tenants or to be available for occupancy on a priority basis
by Very Low Income Tenants as set forth in Section 4 below.
(0 The Lower Income Units will be intermingled with all other dwelling units
in the Project and shall be of comparable quality and offer a range of sizes and number of
PUBL:l7495~1(RED:l7477~2~~0:~17477~1)109~ B2062.14 6 OS/l 1194
bedrooms comparable to the other units in the Project. Tenants in the Lower Income Units will
continue to have equal access to and enjoyment of all common facilities of the Project.
(fit) The Project Site consists of a parcel or parcels that are contiguous except
for the interposition of a road, street or stream, and all of the Project Facilities comprise a single
geographically and functionally integrated project for residential rental property, as evidenced by
the ownership, management, accounting and operation of the Project.
0-d No unit in any building or structure in the Project which contains fewer
than 5 units shall be occupied by the Owner or any person related to or affiliated with the
Owner, such as a resident manager or maintenance personnel.
(0 2 Based on records obtained bv the Owner. (i) the Project was
completed on May 19, 1986fL, (ii) the date on which any of the units in the Project was first
occupied was May 11, 19861, (iii) the date on which 10 percent of the units in the Project was
first occupied was May 11, 1986r, and (iv) the date on which 50 percent of the units in the
Project was first occupied was June 22, 1986.
4. LOWER-INCOME TENANTS. Pursuant to the requirements of Section
103(b)(4)(A) of the Prior Code, Section 34312.3 of the Act and the requirements of the City and
the Commission, the Owner hereby represents, warrants and covenants that 1 from the date
hereof and for the remainder of the Qualified Project Period:
(a> Not less than twenty percent (20%) of the units in the Project shall be
continuously occupied by or held available for occupancy by Lower Income Tenants at an
Affordable Rent. For this purpose, a unit occupied by a Lower-Income Tenant who at the
commencement of the occupancy is a Lower-Income Tenant shall be treated as occupied by such
individual or family during their tenancy in such unit, until such time as a recertification of such
individual’s or family’s income in accordance with subparagraph (c) below demonstrates that such
individual or family no longer qualifies as a Lower-Income Tenant. Moreover, a unit previously
occupied by a Lower-Income Tenant and then vacated shall be considered occupied by a
Lower-Income Tenant until reoccupied, other than for a temporary period, at which time the
character of the unit shall be redetermined. In no event shall such temporary period exceed
thirty-one (31) days.
@I On the first day of each month during the term of this Regulatory
Agreement, the Owner shall advise the Commission, the Trustee and the Program Administrator
of the status of the occupancy of the Project by delivering to such parties a Certificate of
Continuing Program Compliance.
(‘3 The Owner will obtain and maintain on file an Income Certification from
each Lower-Income Tenant, dated immediately prior to the initial occupancy of such
Lower-Income Tenant in the Project. The Owner agrees to provide such additional information
as may be required in the future by the State of California, the Commission, the Program
Administrator and by Section 103(b)(4)(A) of the Prior Code and the Regulations, as the same
may be amended from time to time, or in such other form and manner as may be required by
applicable rules, rulings, policies, procedures or other official statements now or hereafter
promulgated, proposed or made by the Department of the Treasury or the Internal Revenue
PUBL:17495~1(RED:17477~2~~0:~17477_1)109~~062.14 7 OS/l l/94
Service with respect to obligations transitioned under Section 1313(a) of the Tax Reform Act of
1986. A copy of each such Income Certification and a copy of the rent roll for the Lower
Income Units shall be attached to the monthly Certificate of Continuing Program Compliance
filed with the Commission, the Trustee and the Program Administrator pursuant to subsection
(b). The Owner shall verify that the income provided by an applicant in an Income Certification
is accurate by taking one or more of the following steps as a part of the verification process: (i)
obtaining a copy of a Lower-Income Tenant’s federal income tax return for the tax year
immediately prior to the commencement of such Lower-Income Tenant’s occupancy, (ii)
obtaining an employer’s verification of such Lower-Income Tenant’s current income, orb (iii) if
the Lower-Income Tenant is unemployed or if the tax return is unavailable, obtaining other
satisfactory evidence of income for such year.
On July 1, 1995 and on July 1 in each odd-numbered year thereafter, the
Owner shall file with the Commission, the Trustee and the Program Administrator a complete
and updated Income Certification form for each Lower-Income Tenant and Very Low Income
Tenant residing in the Project. If, based upon the updated Income Certification, a tenant no
longer qualifies as a Lower-Income Tenant 1, the Owner shall rent the next available unit and
any necessary units thereafter to Lower-Income Tenants or Very Low Income Tenants such that,
by no later than the January 1 immediately following such July 1, at least 20 percent of the units
in the Project are actually occupied by Lower-Income Tenants or Very Low Income Tenants. In
no event shall the rent of any tenant who has ceased to be a Lower-Income Tenant or a Very
Low Income Tenant be raised above the Affordable Rent before such time as a new
Lower-Income Tenant or a Very Low Income Tenant is qualified and commences occupancy of a
unit in the Project at an Affordable Rent. In addition, no tenant shall be denied continued
occupancy in a unit solely because such tenant no longer qualities as a Lower-Income Tenant or a
Very Low Income Tenant because of an increase in household income subsequent to such tenant’s
initial date of occupancy.
W The Owner will: (a) maintain a list of persons who have notified the
Owner of their desire to rent a unit in the Project and who have Adjusted Incomes which would
qualify them as Very Low Income Tenants, and (b) offer to rent at least half of the
Lower-Income Units (subject to the availability thereof at any time) on a priority basis to the
persons on such list prior to offering to rent such units to any other persons and in choosing such
Very Low Income Tenants shall use selection criteria no more burdensome than shall be applied
to other prospective tenants. To fulfil1 its obligation under this subparagraph (d), the Owner shall
place on its waiting list persons referred by the Commission. The Owner agrees to make the
units coming vacant available, on a priority basis, first, to any Very Low Income Tenants who
are Section 8 certificate or voucher holders or the recipients of another rent subsidy and, second,
to other Very Low Income Tenants. Nothing contained in this Section shall require the Owner to
offer to rent such units to such persons on terms and conditions which are more favorable than
the terms and conditions on which such units will be offered to Lower Income Tenants generally.
Provided that the Owner has complied with the foregoing to attract Very Low Income Tenants to
the Project, nothing herein shall be construed as requiring the Owner to keep units vacant for
occupancy by Very Low Income Tenants where no Very Low Income Tenants have applied for
occupancy.
Cd The Owner will maintain complete and accurate records pertaining to the
Lower Income Units, and will permit any duly author&d representative of the Commission, the
8 08lllf94
Program Administrator, the Trustee, the Surety, the Department of the Treasury or the Internal
Revenue Service to inspect the books and records of the Owner pertaining to the Project,
including those records pertaining to the occupancy of the Lower Income Units.
(0 The Owner shall accept as tenants on the same basis as all other
prospective tenants, persons who are recipients of federal certificates for rent subsidies pursuant
to the existing program under Section 8 of the United States Housing Act of 1937, or its
successor. The Owner shall not apply selection criteria to Section 8 certificate holders which are
more burdensome than criteria applied to any other prospective tenants.
Cl!) The form of lease to be utilized by the Owner in renting any units in the
Project to any person other than a Section 8 tenant who is intended to qualify as a Lower-Income
Tenant shall provide for termination of the lease and consent by such person to immediate
eviction for failure to qualify as a Lower-Income Tenant as a result of any material
misrepresentation made by such person with respect to the Income Certification or for failure to
cooperate with the Owner in recertification of income.
0-O On September 1 I3, 1996, and annually thereafter, the Owner will provide
to the Commission a report demonstrating that the average rents of the Lower Income Units do
not exceed 90 percent of the average rents for market rate units based on leases in effect for the
Proiect on the date of the report.
5. TAX EXEMPT STATUS OF THE BONDS. The Owner and the-Commission
each hereby represents, warrants and agrees that:
60 it will not take or permit, or omit to take or cause to be taken, as is
appropriate, any action that would adversely affect the exclusion from gross income for federal
income tax purposes or the exemption from California personal income taxes of interest on the
Prior Bonds or the Bonds and, if it should take or permit, or omit to take or cause to be taken,
any such action, it will take all lawful actions necessary to rescind or correct such actions or
omissions promptly upon obtaining knowledge thereof;
0) it will take such action or actions as may be necessary, in the written
opinion of Bond Counsel filed with the Commission and the Trustee, (i) to comply fully with all
applicable rules, rulings, policies, procedures, Regulations or other official statements
promulgated, proposed or made by the Department of the Treasury or the Internal Revenue
Service pertaining to obligations issued under Section 103(b)(4)(A) of the Prior Code and
transitioned under Section 1313(a) of the Tax Reform Act of 1986, and (ii) to comply with the
Act; and
(c) it will file and/or record such documents and take such other steps as are
necessary, in the written opinion of Bond Counsel filed with the Commission and the Trustee, in
order to insure that the requirements and restrictions of this Regulatory Agreement will be
binding upon all owners of the Project, including, but not limited to, the execution and
recordation of this Regulatory Agreement in the real property records of the County of San
Diego.
PUBL:1749~~1(RKD:17477~2~T0:~17477_1)109~B2062.14 9 08/l 1194
The Owner hereby covenants to include the requirements and restrictions contained in this
Regulatory Agreement in any documents transferring any interest (other than a leasehold interest)
in the Project to another person to the end that such transferee has notice of, and is bound by,
such restrictions, and to obtain the agreement from any transferee to abide by all requirements
and restrictions of this Regulatory Agreement.
6. MODIFICATION OF SPECIAL TAX COVENANTS. The Owner, the Trustee
and the Commission hereby agree as follows:
(a) To the extent any amendments to the Act, the Regulations, the Prior Code
or the Code shall, in the written opinion of Bond Counsel filed with the Commission, the Trustee
and the Owner, impose requirements upon the ownership or operation of the Project more
restrictive than those imposed by this Regulatory Agreement which must be complied with in
order to maintain the exclusion from gross income for federal income tax purposes of interest on
the Bonds, this Regulatory Agreement shall be deemed to be automatically amended to impose
such additional or more restrictive requirements.
(3) To the extent any amendments to the Act, the Regulations, the Prior Code
or the Code shall, in the written opinion of Bond Counsel filed with the Commission, the Trustee
and the Owner, impose requirements upon the ownership or operation of the Project less
restrictive than imposed by this Regulatory Agreement, this Regulatory Agreement may be
amended or modified to provide such less restrictive requirements should the Commission, in its
sole discretion, decide that such requirements should be made applicable to the Project.
Cc) The Owner, the Commission and, if applicable, the Trustee, upon the
written direction of the Commission, shall execute, deliver and, if applicable, file of record any
and all documents and instruments, necessary to effectuate the intent of this Section 6, and each
of the Owner and the Commission hereby appoints the Trustee as its true and lawful
attorney-in-fact to execute, deliver and, if applicable, file of record on behalf of the Owner or the
Commission, as is applicable, any such document or instrument (in such form as may be
approved in writing by Bond Counsel) if either the Owner or the Commission defaults in the
performance of its obligations under this subsection (c); provided, however, that the Trustee shall
take no action under this subsection (c) without first notifying the Owner or the Commission, or
each of them, as is applicable, unless directed in writing by the Commission or the Owner, and
without first providing the Owner or the Commission, or each of them, as is applicable, an
opportunity to comply with the requirements of this Section 6.
7. INDEMNIFICATION. The Owner shall indemnify, hold harmless and defend
the City, the Commission, the Trustee and the Prior Trustee and the respective officers,
members, councilmembers, directors, officials and employees of each of them (collectively, the
“Indemnified Parties”) to the maximum extent permitted by law against any and all losses, costs,
damages, claims, actions, expenses and liabilities of whatever nature, kind or character
(including, without limitation, attorneys’ fees of counsel reasonably acceptable to the Indemnified
Party, litigation and court costs, amounts paid in settlement, and amounts paid to discharge
judgments) directly or indirectly arising out of or related to any claim, suit, investigation,
proceeding or action commenced or threatened, arising out of or related to (a) any default or
alleged default under the Prior Loan Agreement or the Prior Reimbursement Agreement; (b) 2
the redemption of the Prior Bonds; (c) the issuance of the Bonds; or (d) any written statements or
PUBL:17495~1(RKD:17477_2_TO:_17477_1)109~B2062.14 10 OS/ 11 t94
representations with respect to the Owner, the Project, the Prior Bonds or the Bonds made or
given to the Commission, the Prior Trustee or the Trustee, or any underwriters or purchasers of
any of the Bonds, by the Owner, or any of its agents or employees, including, but not limited to,
statements or representations of fact, or financial information; provided, however, that this
provision shall not require the Owner to indemnify the Prior Trustee or the Trustee from any
claims, costs, fees, expenses or liabilities arising from the negligence or willful misconduct of the
Prior Trustee or the Trustee.
The indemnification provided herein shall apply whether any such claim, suit,
investigation, proceeding or action complains of (a) any alleged interference with or breach of
any existing contract between the Commission and the owners of the Prior Bonds, g (b) 2 any
other alleged wrongful act of the Indemnified Parties related to any default or alleged default
under the Prior Reimbursement Agreement: or the redemption of the Prior Bonds, and regardless
of whether the Indemnified Parties, or any agent thereof, made any investigation with respect to
the facts relating to the Project which was financed with the Prior Bonds or the Developer or any
affiliate thereof or the Prior Loan or the Prior Bonds for the purpose of determining whether the
proceedings described in the preceding paragraph were appropriate.
Upon the sale or transfer of the Project, the acquiring person or entity shall
indemnify and hold harmless the Indemnified Parties as provided herein, and upon such
indemnification, and only upon such indemnification, by the acquiring party, the Owner shall
thereafter have no further liability hereunder except for claims arising from any act or omission
of the Owner occurring while the Project was owned by the Owner.
In the event that any claim, suit, investigation, action or proceeding is brought
against an Indemnified Party, with respect to which indemnity may be sought hereunder, the
Owner, upon receipt of written notice from an Indemnifkd Party, shall assume and have the right
to direct the investigation, defense and settlement thereof, including the employment of counsel
acceptable to the Indemnified Party and the payment of all expenses; provided that the
Indemnified Party shall have the right to review and approve or disapprove any compromise or
settlement in connection with any such claim, suit, investigation, proceeding or action brought
against such Indemnified Party or to which it is a party. The Indemnified Parties also agree to
coouerate with the Owner in the Owner’s investiaation, defense and/or settlement of anv
such claim. suit, uroceeding or action. Any Indemnified Party shall have the right to employ
separate counsel in any suit, investigation, action or proceeding and to participate in the defense
thereof; but unless such separate counsel is employed with the approval and consent of the
Owner, or pursuant to a court order, the Owner shall not be required to pay the fees and
expenses of such separate counsel.
The Owner also shall pay and discharge and shall indemnify and hold harmless the
Commission and the Trustee from (x) any lien or charge upon payments by the Owner to the
Commission and the Trustee hereunder and (y) any taxes (including, without limitation, all ad
valorem taxes and sales taxes), assessments, impositions and other charges in respect of any
portion of the Project. If any such claim is asserted, or any such lien or charge upon payments,
or any such taxes, assessments, impositions or other charges, are sought to be imposed, the
Commission or the Trustee shall give prompt notice to the Owner and the Owner shall have the
sole right and duty to assume, and will assume, the defense thereof, with full power to litigate,
compromise or settle the same in its sole discretion.
PUBL:17495~1(RKD:17477~2~~0:~17477_1)109~B2062.14 11 OS/l 1194
8. CONSIDERATION. The Commission has issued the Bonds to provide funds to
make the Loan to refund the Prior Bonds, the proceeds of which Prior Bonds have been used h
parJ to construct and equip the Project. The Trustee has entered into the Indenture and assumed
duties and obligations thereunder which facilitate the issuance of the Bonds. In consideration of
the issuance of the Bonds by the Commission and the execution of the Indenture by the Trustee,
the Owner has entered into this Regulatory Agreement and has agreed to continue to restrict the
uses to which this Project can be put as originally restricted by the Prior Regulatory Agreement
and on the terms and conditions set forth herein.
9. RELIANCE. The Commission, the Trustee and the Owner hereby recognize and
agree that the representations and covenants set forth herein may be relied upon by all persons
interested in the legality and validity of the Bonds, and in the exclusion from gross income for
federal income tax purposes and the exemption from State of California personal income taxes of
interest on the Bonds and the Prior Bonds. In performing their duties and obligations hereunder,
the Commission and the Trustee may rely upon statements and certificates, or the absence
thereof, of the Owner, iower-Income Tenants, Very Low Income Tenants and the Program
Administrator, and upon audits of the books and records of the Owner pertaining to the Project.
In addition, the Commission and the Trustee may consult with counsel, and the opinion of such
counsel shall be full and complete author&&ion and protection in respect of any action taken or
suffered by the Commission or the Trustee hereunder in good faith and in conformity with such
opinion. In determining whether any default or lack of compliance by the Owner exists under
this Regulatory Agreement, the Trustee shall not be required to conduct any investigation into or
review of the operations or records of the Owner and may rely solely on any notice or certificate
delivered to the Trustee by the Owner, the Program Administrator or the Commission with
respect to the occurrence or absence of a default unless it actually knows, or in the exercise of
reasonable care should have known, that the notice or certificate is erroneous or misleading.
In accepting its obligations hereunder, the Trustee acts solely as trustee for the
benefit of the Bondholders and not in its individual capacity, and all persons, including, without
limitation, the Commission and the Owner, seeking payment from the Trustee for any liability
arising by reason of the transactions contemplated hereby shall look only to such Trust Estate for
payment, except where such liability arises from the negligence or willful misconduct of the
Trustee.
10. PROJECT LOCATION. The Owner hereby represents and warrants that the
Project is located entirely within the territorial boundaries served by the Commission.
11. SALE OR TRANSFER OF THE PROJECT. The Owner hereby covenants and
agrees not to sell, transfer or otherwise dispose of the Project, or any portion thereof (other than
for individual tenant use as contemplated hereunder), without obtaining the prior written consent
of the Commission and the Trustee, which consent shall be deemed given upon receipt by the
Commission and the Trustee of (i) evidence reasonably satisfactory to the Commission and the
Trustee that the Owner’s purchaser or transferee has assumed in writing, and to the satisfaction
of the Commission, the Owner’s duties and obligations under this Regulatory Agreement; (ii) an
opinion of counsel & the transferee that the transferee has duly assumed the obligations of the
Owner under this Regulatory Agreement and that such obligations and this Regulatory Agreement
are binding on the transferee; and (iii) an opinion of Bond Counsel that such transfer will not
adversely affect the exclusion from gross income for federal income tax purposes of interest on
PUBL:17495~1(RKD:17477~2~~0:~17477_1)109~ B2062.14 12 OS/l 1194
the Bonds or the Prior Bonds. It is hereby expressly stipulated and agreed that any voluntary
sale, transfer or other disposition of the Project in violation of this Section 11 shall be null, void
and without effect, shall cause a reversion of title to the Owner, and shall be ineffective to relieve
the Owner of its obligations under this Regulatory Agreement. Nothing contained in this Section
11 shall affect any provision of any other document or instrument which requires the Owner to
obtain prior consent to a voluntary sale, transfer or other disposition of the Project.
12. TERM. This Regulatory Agreement and all and several of the terms hereof shall
become effective upon its execution and delivery and shall remain in full force and effect for the
Qualified Project Period, it being expressly agreed and understood that the provisions hereof are
intended to survive the retirement of the Bonds and expiration of the Indenture, the Loan
Agreement, the Loan, the First Deed of Trust and the Note. Notwithstanding any other
provisions of this Regulatory Agreement, this entire Regulatory Agreement, or any of the
provisions or sections hereof, may be terminated upon agreement by the Commission, the Trustee
and the Owner if there shall have been received an opinion of Bond Counsel that such
termination will not adversely affect the exclusion from gross income for federal income tax
purposes or the exemption from State of California personal income taxes of interest on the
Bonds or the Prior Bonds. The Owner shall provide notice of any termination of this Regulatory
Agreement to the Trustee.
The terms of this Regulatory Agreement to the contrary notwithstanding, this
Regulatory Agreement, and all and several of the terms hereof, shall terminate and be of no
further force and effect in the event of (i) a foreclosure of the lien of the First Deed of Trust or
delivery of a deed in lieu of foreclosure whereby a third party shall take possession of the Project
or involuntary noncompliance with the provisions of this Regulatory Agreement caused by fire,
seizure, requisition, change in a federal law or an action of a federal agency after the date of
execution hereof or condemnation or a similar event which prevents the Commission and the
Trustee from enforcing the provisions hereof and (ii) the payment in full and retirement of the
Bonds within a reasonable period thereafter; provided, however, that the preceding provisions of
this sentence shall cease to apply and the restrictions contained herein shall be reinstated if, at
any time subsequent to the termination of such provisions as the result of an event described in
(i) above, the Owner or any related person to it (within the meaning of Section 1.103-10(e) of the
Regulations) obtains an ownership interest in the Project for federal income tax purposes. Upon
the termination of the terms of this Regulatory Agreement, the parties hereto agree to execute,
deliver and record appropriate instruments of release and discharge of the terms hereof; provided,
however, that the execution and delivery of such instruments shall not be necessary or a
prerequisite to the termination of this Regulatory Agreement in accordance with its terms.
13. COVENANTS TO RUN WITH THE LAND. The Owner hereby subjects the
Project (including the Project Site) to the covenants, reservations and restrictions set forth in this
Regulatory Agreement. The Commission, the Trustee and the Owner hereby declare their
express intent that the covenants, reservations and restrictions set forth herein shall be deemed
covenants running with the land and shall pass to and be binding upon the Owner’s successors in
title to the Project; provided, however, that on the termination of this Regulatory Agreement said
covenants, reservations and restrictions shall expire. Each and every contract, deed or other
instrument hereafter executed covering or conveying the Project or any portion thereof shall
conclusively be held to have been executed, delivered and accepted subject to such covenants,
PUBL:17495~1(RKD:17477_2_To:_17477_1)10962.14 13 OS/l 1194
reservations and restrictions, regardless of whether such covenants, reservations and restrictions
are set forth in such contract, deed or other instruments.
14. BURDEN AND BENEFIT. The Commission, the Trustee and the Owner hereby
declare their understanding and intent that the burden of the covenants set forth herein touch and
concern the land in that the Owner’s legal interest in the Project is rendered less valuable
thereby. The Commission, the Trustee and the Owner hereby further declare their understanding
and intent that the benefit of such covenants touch and concern the land by enhancing and
increasing the enjoyment and use of the Project by Lower-Income Tenants and Very Low Income
Tenants, and by furthering the public purposes for which the Bonds were issued.
15. UNIFORMITY; COMMON PLAN. The covenants, reservations and restrictions
hereof shall apply uniformly to the entire Project in order to establish and carry out a common
plan for the use, development and improvement of the Project Site.
16. ENFORCEMENT. If the Owner defaults in the performance or observance of
any covenant, agreement or obligation of the Owner set forth in this Regulatory Agreement, and
if such default remains uncured for a period of thirty days after notice thereof shall have been
given by the Commission or the Trustee to the Owner with a CODY to the Surety (provided that
said period may be extended if the Owner has commenced to cure such default and is diligently
pursuing such cure and delivers to the Commission and the Trustee an opinion of Bond Counsel
to the effect that such extension will not adversely affect the exclusion from gross income for
federal income tax purposes of interest on the Bonds), then the Commission or the-Trustee,
acting on its own behalf or on behalf of the Commission, shall declare an “Event of Default” to
have occurred hereunder, and, at its option, may take any one or more of the following steps:
(0 by mandamus or other suit, action or proceeding at law or in
equity, require the Owner to perform its obligations and covenants hereunder or
enjoin any acts or things which may be unlawful or in violation of the rights of
the Commission or the Trustee hereunder;
(ii) have access to and inspect, examine and make copies of all of the
books and records of the Owner pertaining to the Project;
(iii) take such other action at law or in equity as may appear necessary
or desirable to enforce the obligations, covenants and agreements of the Owner
hereunder; or
(iv) require the Commission to declare a default under the Loan and
accelerate the indebtedness evidenced by the Note, and thereafter exercise all other
rights and remedies under the Loan Agreement and the First Deed of Trust e Jother than foreclosure of the lien of the First Deed of Trust unless such
foreclosure action does not imDair the lien and securitv interest of the Suretv
The Trustee shall have the right, in accordance with this Section 16 and the provisions of the
Indenture, without the consent, approval or knowledge of the Commission, to exercise any or all
of the rights or remedies of the Commission hereunder; provided that prior to taking any such act
PUBL:l7495~1(RKD:17477~2~~o:~17477~1)109~B2062.14 14 08/11/94
the Trustee shall give the Commission reasonable written notice, which shall not be less than 15
days in advance of its intended action. All fees, costs and expenses of the Trustee incurred in
taking any action pursuant to this Section 16 shall be the sole responsibility of the Owner.
After the Indenture has been discharged, the Commission may act on its own
behalf to declare an “Event of Default” hereunder and to exercise any of the enforcement
remedies set forth above to the same extent and with the same effect as if taken by the Trustee.
Notwithstanding any provision in this Regulatory Agreement, the liability of the
Owner with respect to default in payment of the amounts owing under the Note is limited as
provided in Section 8.11 of the Loan Agreement.
17. RECORDING AND FILING. The Owner shall cause this Regulatory
Agreement and all amendments and supplements hereto and thereto, to be recorded and filed in
the real property records of the County of San Diego and in such other places as the Commission
or the Trustee may reasonably request. The Owner shall pay all fees and charges incurred in
connection with any such recording. Upon recordation, this Regulatory Agreement shall
supersede the provisions of Sections 2 and 3 of the Developer Agreement in their entirety and be
controlling.
18. PAYMENT OF FEES. In the event that a party to this Regulatory Agreement
brings an action against any other party to this Regulatory Agreement by reason of the breach of
any condition or covenant, representation or warranty in this Regulatory Agreement, or otherwise
arising out of this Regulatory Agreement, the prevailing party in such action shall be entitled to
recover from the other reasonable attorneys’ fees to be fixed by the court which shall render a
judgment, as well as the costs of suit.
Notwithstanding any prepayment of the Loan and notwithstanding a discharge of
the Indenture, throughout the term of this Regulatory Agreement, the Owner shall pay the
Commission’s annual administrative fee of -23 percent of the principal amount of the Bonds as of
the Closing Date in arrears on September 8 of each year, commencing September 8, 1995, and
shall also reimburse the Commission and the Trustee for all expenses reasonably incurred by
them in connection with enforcement of their rights and remedies under this Regulatory
Agreement.
On the Closing Date, the Owner shall pay the Commission’s initial administrative
fee of .23 percent of the principal amount of the Bonds.
19. GOVERNING LAW. This Regulatory Agreement shall be governed by the laws
of the State of California. The Trustee’s rights, duties and obligations hereunder are governed in
their entirety by the terms and provisions of the Indenture.
20. AMENDMENTS. Except as provided in Section 6(a) hereof, this Regulatory
Agreement shall be amended only by a written instrument executed by the parties hereto or their
successors in title, and duly recorded in the real property records of the County of San Diego.
The parties hereto agree that the Prior Regulatory Agreement shall terminate and
be of no further force and effect as of the date of recordation of this Regulatory Agreement and
PUBL:17495~1(RKD:17477~2~~0:~17477_1)109~B2062.14 15 08/l 1194
agree that the recordation of this Regulatory Agreement shall operate as evidence of such
termination of the Prior Regulatory Agreement.
21. NOTICE. Any notice required to be given hereunder shall be made in writing
and shall be given by personal delivery, certified or registered mail, postage prepaid, return
receipt requested, at the addresses specified below, or at such other addresses as may be specified
in writing by the parties hereto:
Commission: Carlsbad Housing and Redevelopment Commission
2965 Roosevelt Street
Carlsbad, California 92008-2389
Attention: Housing and Redevelopment Director
Trustee and
Program
Administrator :
Owner:
First Trust of California, National Association
101 California Street, Suite 1150
San Francisco, California 94111
Attention: Multifamily Housing Group
Seascape Apartments, Inc.
c/o Continental Casualty Company
CNA Plaza
Chicago, Illinois 60685
Attention: Vice President
Suretv: Continental Casualtv Comuanv
CNA Plaza
Chicano. Illinois 60685
Attention: Senior Vice President and General Counsel
with a cow to: Continental Casualtv Comuanv
CNA Plaza
Chicago, Illinois 60685
Attention: Coruorate Secretarv
Notice shall be deemed given three business days after the date of mailing, by certified mail,
postage prepaid, return receipt requested, or, if personally delivered, when received.
22. SEVERABILITY. If any provision of this Regulatory Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining portions
hereof shall not in any way be affected or impaired thereby.
23. MULTIPLE COUNTERPARTS. This Regulatory Agreement may be
simultaneously executed in multiple counterparts, all of which shall constitute one and the same
instrument, and each of which shall be deemed to be an original.
24. TRUSTEE LIABILITY. The Trustee has entered into this Regulatory
Agreement in its capacity as Trustee under the Indenture and not in its individual capacity. Its
PUBL: 17495-l (RKD: 17477~2~~0:~17477~1)109 1 B2062.14 16 oat1 1194
duties, obligations, rights and privileges hereunder shall in all cases be subject to the provisions
of Article X of the Indenture.
25. LIMITED RECOURSE PROVISIONS. Notwithstandina anv nrovisions of
this Reaulatorv Agreement (other than the nrovisions of Section 7 hereof) to the contrarv, in
anv action commenced to enforce the obligations of the Owner created or arisinp hereunder,
the iudpment shall not be enforceable nersonallv against the Owner or its successors or
aaainst anv affiliate. subsidiarv or cornorate narent of the Owner), or against assi ns or P (
anv assets of the Owner or its successors or assigns (or wainst the assets of anv affiliate,
pbsidiarv or coreorate narent of the Owner). extent for the Granted Pronertv and all
rents, issues, urofits. nroceeds. revenues, insurance nroceeds and awards and other income
from the Granted Pronertv.
IN WITNESS WHEREOF, the Commission, the Trustee and the Owner have
executed this Regulatory Agreement by duly authorized representatives, all as of the date first
written above.
CARLSBAD HOUSING AND
REDEVELOPMENT COMMISSION
By:
Chairman
ATTEST:
Secretary
FIRST TRUST OF CALIFORNIA, NATIONAL
ASSOCIATION, as Trustee
By:
Author&d Signatory
SEASCAPE APARTMENTS, INC., an Illinois
corporation
By:
Vice President
ATTEST:
PUBL:17495~1(RJZD:17477~2~T0:~17477_1)109~B2062.14 17 08/l 1194
Secretarv
18 08/l II94
STATE OF CALIFORNIA 1
1 COUNTY OF SAN DIEGO )
On
aPPe--I
, before me, 3 personally
and ,
- personally known to me -- OR --
- proved to me on the basis of satisfactory evidence
to be the persons whose names are subscribed to the within instrument and acknowledged to me
that they executed the same in their author&d capacities, and that by their signatures on the
instrument the persons, or the entity upon behalf of which the persons acted, executed the
instrument.
Witness my hand and official seal.
(Signature of Notary)
CAPACITY CLAIMED BY SIGNER:
Individual -
- Corporate Officer(s):
Title(s)
- Partner(s): _ Limited _ General
- Attorney-in-Fact
- Trustee(s)
x
Guardian/Conservator
Other: Chairman and Secretarv
SIGNER IS REPRESENTING: The Carlsbad Housing and Redevelopment Commission
ATTENTION NOTARY: Although the information requested below is OPTIONAL, it
could prevent fraudulent attachment of this certificate to another document.
THIS CERTIFICATE
MUST BE ATTACHED
TO THE DOCUMENT
DESCRIBED
AT RIGHT:
Title or Type of Document
Number of Pages
Date of Document
Signer(s) Other Than Named Above:
~~~~:17495~1(~~~:17477~2~~o:_17477_1)109~ B2062.14 19 08/11194
STATE OF CALIFORNIA 1
) COUNTY OF SAN FRANCISCO)
On
appeared
, before me, , personally
and ,
- personally known to me -- OR --
- proved to me on the basis of satisfactory evidence
to be the person whose name is subscribed to the within instrument and acknowledged to me that
he executed the same in his authorized capacity, and that by his signature on the instrument the
person, or the entity upon behalf of which the person acted, executed the instrument.
Witness my hand and official seal.
(Signature of Notary)
CAPACITY CLAIMED BY SIGNER:
Individual -
- Corporate Officer(s):
Title(s)
- Partner(s): _ Limited _ General
- Attorney-in-Fact
- Trustee(s)
Guardian/Conservator
x Other: Authorized Signatories
SIGNER IS REPRESENTING: First Trust of California, National Association
ATTENTION NOTARY: Although the information requested below is OPTIONAL, it
could prevent fraudulent attachment of this certificate to another document.
THIS CERTIFICATE
MUST BE ATTACHED
TO THE DOCUMENT
DESCRIBED
AT RIGHT:
Title or Type of Document
Number of Pages
Date of Document
Signer(s) Other Than Named Above:
20 OS/l l/94
STATE OF 1
) COUNTY OF )
, before me, , personally
and ,
- personally known to me -- OR --
- proved to me on the basis of satisfactory evidence
to be the person whose name is subscribed to the within instrument and acknowledged to me that
he executed the same in his author&d capacity, and that by his signature on the instrument the
person, or the entity upon behalf of which the person acted, executed the instrument.
Witness my hand and official seal.
(Signature of Notary)
CAPACITY CLAIMED BY SIGNER:
Individual
x Corporate Officer(s):
Title(s)
- Partner(s): _ Limited _ General
- Attorney-in-Fact
- Trustee(s)
Guardian/Conservator - Other: -
SIGNER IS REPRESENTING: Seascape Apartments, Inc.
ATTENTION NOTARY: Although the information requested below is OPTIONAL, it
could prevent fraudulent attachment of this certificate to another document.
THIS CERTIFICATE
MUST BE ATTACHED
TO THE DOCUMENT
DESCRIBED
AT RIGHT:
Title or Type of Document
Number of Pages
Date of Document
Signer(s) Other Than Named Above:
PUBL: 17495~1(~~D:17477~2~~o:_17477_1)1091B206.14 21 OS/l 1194
EXHIBIT A
LEGAL DESCRIPTION
All that certain real property situated in the City of Carlsbad, County of San Diego, State of
California, described as follows:
Lots 100 and 101 of CARLSBAD TRACT NO. 73-23, in the City of Carlsbad, County of San
Diego, State of California, according to Map thereof No. 8081, filed in the Office of the County
Recorder of San Diego County, February 28, 1975.
Excepting all crude, oil, petroleum, gas, brea, asphalturn and all kindred substances and other
minerals in and under said land, but without the right to enter upon the surface of said land above
a depth of 500.00 feet to explore for or extract same, as reserved in a Deed recorded August 27,
1969 as File No. 157186 and that Deed recorded August 27, 1969 as File No. 157190, both of
Official Records.
Also excepting ah oil, oil rights, mineral rights, natural gas rights and other hydrocarbons by
whatsoever name known, together with all geothermal steam and steam power that may be within
or under the parcel of land hereinafter described, together with the perpetual right of drilling,
mining, exploring and operating therefor and storing in and removing the same from said land,
or any other land, including the right to whipstock or directionally drill and mine from lands
other than those hereinafter described, oil or gas wells, tunnels and shafts into, through or across
the subsurface of the land hereinafter described and to bottom such whipstocked or directionally
drilled wells, tunnels and shafts under and beneath or beyond the exterior limits thereof, and to
redrill, retunnel, equip, maintain, repair, deepen and operate such wells or mines, without,
however, the right to drill, mine, store, explore and operate through or on the surface or the
upper 500 feet of the subsurface of the land herein described.
PUBL:17495~1(FSD:17477~2~~0:~17477_1)10962.l4 A-l 08/l 1194
EXHIBIT B
CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE
The undersigned, being duly authorized to execute this certificate on
behalf of Seascape Apartments, Inc., an Iknois corporation (the “Owner”), hereby represents and
warrants that:
1. He has read and is thoroughly familiar with the provisions of the various Loan
Documents associated with the Owner’s participation in the Carlsbad Housing and Redevelopment
Commission’s (the “Commission”) Variable Rate Demand Multifamily Housing Revenue
Refunding Bonds, Series A of 1994 (Seascape Village Project), such documents including:
(a) the Amended and Restated Regulatory Agreement and
Declaration of Restrictive Covenants dated as of September 1, 1994 (the “Regulatory
Agreement’) among the Owner, the Commission and First Trust of California, National
Association, (the “Trustee”);
(3) the Loan Agreement dated as of September 1, 1994 between the
Owner and the Commission; and
(cl the Note dated September 1, 1994 from the Owner. to the
Commission representing the Owner’s obligation to repay the Loan.
2. As of the date of this certificate, the following percentages of residential units
in the Project (i) are occupied by Lower-Income Tenants or Very Low Income Tenants at
Affordable Rents (as such terms are defined in the Regulatory Agreement) or (ii) are currently
vacant and being held available for such occupancy and have been so held continuously since the
date a Lower-Income Tenant or a Very Low Income Tenant vacated such unit; as indicated:
Occupied by Lower-Income
Tenants (including Very
Low Income Tenants):
Occupied by Very Low Income
Tenants:
-% Unit Nos.
-% Unit Nos.
Held vacant for occupancy
continuously since last
occupied by Lower-Income
Tenant: -% Unit Nos.
Attached hereto is the current rent roll for the units described above.
PUBL:17495~1(RKD:17477~2~~o:~17477~1)109~~062.14 B-l OS/l l/94
3. To the best knowledge of the Owner, (i) the Owner is not in default under the
terms of the Regulatory Agreement and (ii), no Determination of Taxability has occurred with
respect to the Bonds.
SEASCAPE APARTMENTS, INC., an
Illinois corporation
By:
Its:
PUBL:l7495-1 (FtED:l7477~2~To:~l7477~1)109~ B2062.14 B-2 OS/l 1194
EXHIBIT C
INCOME COMPUTATION AND CERTIFICATION
NOTE TO APARTMENT OWNER: This form is designed to assist you in computing Annual
Income in accordance with the method set forth in the Department of Housing and Urban
Development (“HUD”) Regulations (24 CFR 813). You should make certain that this form is at
all times up to date with the HUD Regulations. All capitalized terms used herein shall have the
meaning set forth in the Regulatory Agreement.
Re: Address of Apartment Building
I/We, the undersigned state that I/we have read and answered fully, frankly and
personally each of the following questions for all persons who are to occupy the unit being
applied for in the above apartment project. Listed below are the names of all persons who intend
to reside in the unit:
1. 2.
Name of Members Relationship
of the to head of
Household Household
3.
&
4. 5.
Social Security - Place of
Number Emulovment
HEAD
SPOUSE
Income Comnutation
6. The total anticipated income, calculated in accordance with this paragraph 6, of all
persons over the age of 18 years listed above for the 1Zmonth period beginning the date
that I/we plan to move into a unit is $ .
Included in the total anticipated income listed above are:
ta) all wages and salaries, overtime pay, commissions, fees, tips and bonuses and
other compensation for personal services, before payroll deductions;
0) the net income from the operation of a business or profession or from the rental of
real or personal property (without deducting expenditures for business expansion
PUBL:17495~1(RED:17477~2~~0:~17477~1)109 1 B2062.14 C-l OS/l l/94
(cl
W
interest and dividends (including income from assets excluded below);
the full amount of periodic payments received from social security, annuities,
insurance policies, retirement funds, pensions, disability or death benefits and
other similar types of periodic receipts, including any lump sum payment for the
delayed start of a periodic payment;
63
(9
Cd
payments in lieu of earnings, such as unemployment and disability compensation,
workmen’s compensation and severance pay;
the maximum amount of public assistance available to the above persons other
than the amount of any assistance specifically designated for shelter and utilities;
periodic and determinable allowances, such as alimony and child support payments
and regular contributions and gifts received from persons not residing in the
dwelling;
00 all regular pay, special pay and allowances of a member of the Armed Forces
(whether or not living in the dwelling) who is the head of the household or
spouse; and
(0 any earned income tax credit to the extent that it exceeds income tax liability.
or amortization of capital indebtedness or any allowances for depreciation of
capital assets);
Excluded from such anticipated income are:
(a) casual, sporadic or irregular gifts;
0)
Cc)
amounts which are specifically for or in reimbursement of medical expenses;
lump sum additions to family assets, such as inheritances, insurance payments
(including payments under health and accident insurance and workmen’s
compensation), capital gains and settlement for personal or property losses;
G-0
te)
amounts of educational scholarships paid directly to the student or the educational
institution, and amounts paid by the government to a veteran for use in meeting
the costs of tuition, fees, books and equipment. Any amounts of such
scholarships or payments to veterans not used for the above purposes are to be
included in income;
hazardous duty pay to a household member who is away from home and exposed
to hostile fire;
(9 relocation payments under Title II of the Uniform Relocation Assistance and Real
Property Acquisition Policies Act of 1970;
PUBL:17495~1(FtED:17477~2~T0:~17477~1)109~ B2062.14 c-2 OS/l l/94
63
0)
(0
(iI
04
(1)
Cm)
(n)
(0)
foster child care payments;
the value of coupon allotments for the purchase of food pursuant to the Food
Stamp Act of 1977;
payments to volunteers under the Domestic Volunteer Service Act of 1973;
payments received under the Alaska Native Claims Settlement Act;
income derived from certain submarginal land of the United States that is held in
trust for certain Indian tribes;
payments or allowances made under the Department of Health and Human
Services’ Low-Income Home Energy Assistance Program;
payments ‘received from the Job Training Partnership Act;
income derived from the disposition of funds of the Grand River Band of Ottawa
Indians; and
the first $2,000.00 of per capita shares received from judgment funds awarded by
the Indian Claims Commission or the Court of Claims.
7. Do the persons whose income or contributions are included in item 6 above
(a) have savings, stocks, bonds, equity in real property or other form of capital
investment (excluding the values of necessary items of personal property such as
furniture and automobiles and interests in Indian trust land) -Yes - No;
or
(b)
(cl
have they disposed of any assets (other than at a foreclosure or bankruptcy sale)
during the last two years at less than fair market value? -Yes - No.
If the answer to (a) or (b) above is yes, does the combined total value of all such
assets owned or disposed of by all such persons total more than $5,000? - Yes
-No
60 If the answer to (c) above is yes, state:
(1)
(2)
the amount of income expected to be derived from such assets in the
12month period beginning on the date of initial occupancy in the unit that
you propose to rent: $ , and
the amount of such income, if any, that was included in item 6 above: $-
8. ta) Are all of the individuals who propose to reside in the unit full-time students*?
Yes - No -
PUBL:17495~1(RKD:17477~2~~0:~17477_1)109~ B2062.14 c-3 08/11/94
*A full-time student is an individual enrolled as a full-time student during each of
5 calendar months during the calendar year in which occupancy of the unit begins
at an educational organization which normally maintains a regular faculty and
curriculum and normally has a regularly enrolled body of students in attendance
and is not an individual pursuing a full-time course of institutional on farm
training under the supervision of an accredited agent of such an educational
organization or of a state or political subdivision thereof.
0) If the answer to 8(a) is yes, is at least 1 of the proposed occupants of the unit a
husband and wife entitled to file a joint federal income tax return? Yes - No
9. Neither myself nor any other occupant of the unit I/we propose to rent is the owner of the
rental housing project in which the unit is located (hereinafter the “Owner”), has any
family relationship to the Owner; or owns directly or indirectly any interest in the Owner.
For purposes of this paragraph, indirect ownership by an individual shall mean ownership
by a family member, ownership by a corporation, partnership, estate or trust in
proportion to the ownership or beneficial interest in such corporation, partnership, estate
or trustee held by the individual or a family member; and ownership, direct or indirect,
by a partner of the individual.
10. This certificate is made with the knowledge that it will be relied upon by the Owner to
determine maximum income for eligibility to occupy the unit; and I/we declare that all
information set forth herein is true, correct and complete and based upon information
I/we deem reliable and that the statement of total anticipated income contained in
paragraph 6 is reasonable and based upon such investigation as the undersigned deemed
necessary.
11. I/we will assist the Owner in obtaining any information or documents required to verify
the statements made herein, including either an income verification from my/our present
employer(s) or copies of federal tax returns for the immediately preceding calendar year.
12. I/we acknowledge that I/we have been advised that the making of any misrepresentation
or misstatement in this declaration will constitute a material breach of my/our agreement
with the Owner to lease the unit and will entitle the Owner to prevent or terminate
my/our occupancy of the unit by institution of an action for ejection or other appropriate
proceedings.
PUBL:17495~1(RKD:17477~2~~0:~17477~1)109~ B2062.14 C-4 08/l 1194
I/we declare under penalty of perjury that the foregoing is true and correct.
Executed this - day of in the City of , California.
C-5
Applicant
Applicant
[Signature of all persons over the
age of 18 years listed in number 2
above required]
OS/l l/94
FOR COMPLETION BY APARTMENT OWNER ONLY:
1. Calculation of eligible income:
a. Enter amount entered for entire
household in 6 above:
b. (1) If the answer to 7(c)
above is yes, enter
the total amount entered
in 7(d)(l), subtract from that figure
the amount entered in 7(d)(2) and
enter the remaining balance ($ );
(2) Multiply the amount entered in
7(c) times the current passbook
savings rate as determined by HUD
to determine what the total annual
earnings on the amount in 7(c)
would be if invested in passbook
savings ($ ), subtract from
that figure the amount entered in
7(d)(2) and enter the remaining
balance ($ );
(3) Enter at right the greater of the
amount calculated under (1) or (2)
above:
C. TOTAL ELIGIBLE INCOME
(Line 1 .a plus line 1 .b(3)):
2. The amount entered in 1 .c:
- Qualifies the applicant(s) as a Lower-Income
Tenant(s).
- Does not qualify the applicant(s) as a Lower-Income
Tenant(s).
Qualifies the applicant(s) as a Very Low Income
Tenant.
3. Number of apartment unit assigned: -
Bedroom Size: Rent: $
PUBL:17495~1(RED:17477~2~~0:~17477~1)109~ B2062.14 C-6
$
$
0811 l/94
4. This apartment unit [was/was not] last occupied for a period
of 31 consecutive days by persons whose aggregate anticipated annual income as certified
in the above manner upon their initial occupancy of the apartment unit qualified them as
Lower-Income Tenants.
5. Method used to verify applicant(s) income:
- Employer income verification.
- Copies of tax returns.
- Other ( )
Manager
c-7 08/l 1194
INCOME VERIFICATION
{for emnloved persons)
The undersigned employee has applied for a rental unit located in a project financed under the
Carlsbad Housing and Redevelopment Commission Multifamily Housing Program for persons of
lower income. Every income statement of a prospective tenant must be stringently verified.
Please indicate below the employee’s current annual income from wages, overtime, bonuses,
commissions or any other form of compensation received on a regular basis.
Annual wages
Overtime
Bonuses
Commissions
Total current income
I hereby certify that the statements above are true and complete to the best of my knowledge.
Signature Date Title
I hereby grant you permission to disclose my income to in order that they
may determine my income eligibility for rental of an apartment located in their project which has
been financed under the Carlsbad Housing and Redevelopment Commission Multifamily Housing
Program.
Signature Date
Please send to:
PUBL:17495~1(R!ZD:17477~2~~0:~17477_1)10~ B2062.14 C-8 08/l 1194
INCOME VERIFICATION
/for self-emnloved Dersons)
I hereby attach copies of my individual federal and state income tax returns for the immediately
preceding calendar year and certify that the information shown in such income tax returns is true
and complete to the best of my knowledge.
Signature
PUBL:17495~1(RJiD:17477~2~~0:~17477_1)10~B2062.14 c-9
Date
08/l 1194