RPVCCA_SA_SR_2012_10_02_C_Transfer_Of_Housing_Function_And_AssetsCITY OF
MEMORANDUM
TO:
FROM:
DATE:
SUBJECT:
REVIEWED:
HONORABLE CHAIR AND MEMBERS OF THE BOARD OF
DIRECTORS OF THE SUCCESSOR AGENCY TO THE RANCHO
PALOS VERDES REDEVELOPMENT AG~Y
DENNIS McLEAN,FINANCE OFFICER ~
OCTOBER 2,2012
TRANSFER OF HOUSING FUNCTION AND ASSETS
CAROLYN LEHR,EXECUTIVE DIRECTOR(f>~c..L.
Staff Coordinator:Kathryn Downs,Deputy Director of Finance &Information
Technology lCf)
RECOMMENDATION
1.Adopt Resolution SA 2012-,transferring housing functions and assets;and
2.Approve the attached Assignment Agreement.
DISCUSSION
Upon dissolution of the Rancho Palos Verdes Redevelopment Agency on February 1,2012
and pursuant to Health and Safety Code Section 34176(b),the City Council adopted a
resolution electing for the City to retain the responsibility for performing housing functions
previously performed by the former Redevelopment Agency,and determining that all of the
assets,as allowed by law,and all rights,powers,liabilities,duties,and obligations
associated with the housing activities of the former Agency be transferred to the City.
Health and Safety Code Section 34177(g)directs the Successor Agency to effectuate
transfer of housing functions and assets to the appropriate entity designated pursuant to
Health and Safety Code Section 34176,being the City.Health and Safety Code Section
34181(c)provides that the Oversight Board of the Successor Agency shall direct the
Successor Agency to transfer housing responsibilities and all rights,powers,duties,and
obligations,to the designated entity pursuant to Health and Safety Code Section 34176.
Health and Safety Code Section 34176(a)(2)directs the entity assuming the housing
functions of the former redevelopment agency to submit to the State Department of
Finance (the "DOF")a list of all housing assets (the "Housing Assets List"),including any
assets transferred between February 1,2012 and the date on which the Housing Assets
SA C-1
TRANSFER OF HOUSING FUNCTION AND ASSETS
October 2,2012
Page 2 of 3
List is created.The Successor Agency submitted that list to the OOF on July 23,2012 (see
Exhibit A to the attached resolution).
Health and Safety Code Section 34176(e)defines "housing asset"as any asset that meets
one of the following criteria:
1.Any real property,interest in,or restriction on the use of real property,whether
improved or not,and any personal property provided in residences,including
furniture and appliances,all housing-related files and loan documents,office
supplies,software licenses,and mapping programs,that were acquired for low and
moderate income housing purposes,either by purchase or through a loan,with any
source of funds;
2.Any funds that are encumbered by an enforceable obligation to build or acquire low
and moderate income housing as defined in the Community Redevelopment Law
(the "CRL")unless required in the bond covenants to be used for repayment
purposes of the bond;
3.Any loan or grant receivable,funded from the Low and Moderate Income Housing
Fund (the "LMIH Fund"),from homeowners,homebuyers,nonprofit or for profit
developers,and other parties that require occupancy by persons of low or moderate
income as defined by the CRL;
4.Any funds derived from rents or operation of properties acquired for low and
moderate income housing purposes by other parties that were financed with any
source of funds,including residual receipt payments from developers,conditional
grant repayments,cost savings and proceeds from refinancing,and principal and
interest payments from homebuyers subject to enforceable income limits;
5.A stream of rents or other payments from housing tenants or operators of low and
moderate income housing financed with any source of funds that are used to
maintain,operate,and enforce the affordability of housing or for enforceable
obligations associated with low and moderate income housing;or
6.Repayments of loans from the LMIH Fund (e.g.,a loan used to make a SERAF
payment)or LMIH Fund deposits which had been deferred as of the effective date
of AB X1 26.
On August 22,2012,the OOF notified the Successor Agency that it did not object to any
assets or transfers of assets identified on the Successor Agency form (see attached letter).
The former Redevelopment Agency possessed housing assets (two promissory notes),
which are described on the Housing Assets List.The attached resolution transfers from
the Successor Agency to the City the assets described on the Housing Assets List,
together with related responsibilities,powers,duties and obligations associated with the
housing activities of the former Redevelopment Agency.
On September 5,2012,the Oversight Board adopted Resolution OB 2012-08 directing the
Successor Agency to transfer to the City the housing assets described on the Housing
Assets List.The attached resolution transfers from the Successor Agency to the City of
the assets described on the Housing Assets List,together with related responsibilities,
powers,duties and obligations associated with the housing activities of the former
SA C-2
TRANSFER OF HOUSING FUNCTION AND ASSETS
October 2,2012
Page 3 of 3
Redevelopment Agency,as directed by the Oversight Board.
FISCAL IMPACT
Transfer of the housing function and assets (promissory notes receivable totaling
$6,751,633.43 at the date of dissolution,January 31,2012)will provide a future resource to
provide affordable housing within the City of Rancho Palos Verdes.
As of June 30,2012,the AMCAL note receivable is $6,703,137 including accrued interest
of $432,593 (3%simple interest).Of this amount,$1,350,276 is payable to the City's
Affordable Housing Fund.Therefore,the net asset being transferred from the Successor
Agency to the City is $5,352,861.The promissory note is to be repaid annually from 50%
of Net Available Cash Flow,after the payment to the developer is made.Net Available
Cash Flow is defined as operating income,less:1)debt service on financing provided by a
third-party commercial lender;2)operating and maintenance expenses;3)deposits to the
operating and replacement reserves;4)fees paid to partners of the developer (not to
exceed $15,000 annually);and 5)audit fees.The loan balance immediately becomes due
upon sale or refinancing of the project;or 55 years from the Certification of Completion
(2066).Staff has received information from the developer indicating that repayment of the
Agency loan will not likely begin for at least 30 years,unless the project is refinanced.
As of June 30,2012,the Mantilla note receivable is $126,320.This note is non-interest
bearing;and becomes payable upon sale or refinancing of the unit.
SA C-3
RESOLUTION NO.SA 2012-
A RESOLUTION OF THE SUCCESSOR AGENCY TO THE RANCHO
PALOS VERDES REDEVELOPMENT AGENCY TRANSFERRING
HOUSING FUNCTIONS AND ASSETS
RECITALS:
A.Pursuant to Health and Safety Code Section 34175(b)and the California
Supreme Court's decision in California Redevelopment Association,et al.v.Ana
Matosantos,et al.(53 Cal.4th 231 (2011 )),on February 1,2012,all assets,properties,
contracts,leases,books and records,buildings,and equipment of the Rancho Palos
Verdes R~development Agency (the "Agency")transferred to the Successor Agency to
the Rancho Palos Verdes Redevelopment Agency (the "Successor Agency")by
operation of law.
B.Pursuant to Health and Safety code Section 34176(a),the City Council of
the City of Rancho Palos Verdes (the "City")adopted Resolution No.2012-15 electing
for the City to retain the responsibility for performing housing functions previously
performed by the Agency,and determining that all of the assets,as allowed by law,and
all rights,powers,liabilities,duties,and obligations associated with the housing
activities of the Agency be transferred to the City.
C.Pursuant to Health and Safety Code Section 34176(a)(2),on July 23,
2012,the City submitted to the State Department of Finance (the "DOF")a list of all
housing assets,including any assets transferred after February 1,2012 (the "Housing
Assets List").
D.On August 22,2012,DOF notified the Successor Agency that DOF does
not object to any of the assets or transfers of assets identified on the Housing Assets
List.
E.Health and Safety Code Section 34177(g)directs the Successor Agency
to effectuate transfer of housing functions and assets to the appropriate entity
designated pursuant to Health and Safety Code Section 34176,being the City,and
Health and Safety Code Section 34181 (c)provides that the oversight board of the
.Successor Agency (the "Oversight Board")shall direct the Successor Agency to transfer
housing assets to the appropriate entity pursuant to Health and Safety Code Section
34176,being the City.
F.On September 5,2012,the Oversight Board adopted Resolution No.OB
2012-08 directing the Successor Agency to transfer to the City the assets identified on
the Housing Assets List.
SA C-4
NOW,THEREFORE,THE BOARD OF THE SUCCESSOR AGENCY TO THE
RANCHO PALOS VERDES REDEVELOPMENT AGENCY HEREBY FINDS,
DETERMINES,RESOLVES,AND ORDERS AS FOLLOWS:
Section 1.The above recitals are true and correct and are a substantive part
of this Resolution.
Section 2.This Resolution is adopted pursuant to Health and Safety Code
Section 34177(g).
Section 3.The Assignment of Housing Loans in the form presented and on file
with the Secretary of the Successor Agency and the transfer to the City of the assets
described on the Housing Assets List attached hereto as Exhibit A are hereby
approved ..Each of the Chair and Vice Chair of the Board and the Executive Director of
the Successor Agency (each,an "Authorized Officer"),acting singly,is hereby
authorized and directed,for and in the name and on behalf of the Successor Agency,to
execute and deliver the Assignment of Housing Loans in substantially said form,with
such changes therein as the Authorized Officer,may approve (such approval to be
conclusively evidenced by the execution and delivery thereof).The Board further
approves the transfer to the City of all rights,powers,duties,and obligations associated
with the housing activities of the former Agency related to the housing assets
transferred pursuant to this Section 3.
Section 4.The Executive Director of the Successor Agency is hereby
authorized and directed to execute and record such documents and instruments and to
do any and all other things which the Executive Director may deem necessary or
advisable to effectuate this Resolution.
PASSED AND ADOPTED this 2nd day of October,2012.
Chair
ATTEST:
Secretary
SA C-5
EXHIBIT A
Housing Assets List
(See attached)
SA C-6
Exhibit D -Loans/Grants Receivables
Resolution Exhibit A
City of Rancho Palos Verdes
Inventory of Assets Received Pursuant to Health and Safety Code section 34176 (a)(2)
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Loan
Loan
6,270,543.76
126,320.00
Construction of
AMCAL Mirandela II affordable
12/29/20091 1 Fund,LP housing I IYes I Ifull in 55 years.1 13%Simple I I
6,625,313.43
Purchase of
affordable I
kes I lupon sale or
Mercedes Adriana housing transfer.Due in full
2/22120111 1 Mantilla IIcondominium unit in 45 years.I INone I I
126,320.00
S
A
C
-
7
ASSIGNMENT OF HOUSING LOANS
THIS ASSIGNMENT OF HOUSING LOANS ("Assignment")is made and entered
into as of this 2 nd day of October,2012,by the SUCCESSOR AGENCY TO THE
RANCHO PALOS VERDES REDEVELOPMENT AGENCY ("Assignor"),and the CITY
OF RANCHO PALOS VERDES,as successor to the housing assets,rights,powers and
obligation of the Rancho Palos Verdes Redevelopment Agency ("Assignee").
Assignor hereby assigns and transfers (to the fullest extent assignable or
transferable)unto Assignee all of its right,title,claim and interest (if any)in and under:
(A)all loans described on Exhibit "A"attached hereto,including all documents
evidencing securing,or relating to such loans (including,without limitation,any
mortgages,deeds of trust,regulatory agreements,and conditions,covenants and
restrictions,whether or not recorded).
ASSIGNOR AND ASSIGNEE FURTHER HEREBY AGREE AND COVENANT
AS FOLLOWS:
1.Assignee hereby accepts the foregoing assignment and assumes all of the
Assignor's obligations,if any,under said loans and loan documents.
2.This Assignment shall be binding on and inure to the benefit of the parties
hereto,their heirs,executors,administrators,successors in interest and assigns.
3.This Assignment shall be governed by and construed in accordance with
the laws of the State of California.
4.This Assignment may be executed in several counterparts,each of which
shall be deemed an original,and all of such counterparts together shall constitute one
and the same instrument.
SA C-8
IN WITNESS WHEREOF,Assignor and Assignee have executed this
Assignment the day and year first above written.
By:_
By:_
Name:_
Title:_
ASSIGNOR:ASSIGNEE:
SUCCESSOR AGENCY TO THE RANCHO CITY OF RANCHO PALOS VERDES,in its
PALOS VERDES REDEVELOPMENT capacity as successor to the housing
AGENCY assets,rights,powers and obligations of the
Rancho Palos Verdes Redevelopment
Agency
Mayor
ATTEST:ATTEST:
City Clerk
SA C-9
EXHIBIT "A"
DESCRIPTION OF THE HOUSING LOANS
1.$6,790,000 loan to Amcal Mirandela Fund,L.P.evidenced by a promissory note
in such amount dated December 29,2009 executed by said borrower.
2.$126,320 loan to Mercedes Adriana Mantilla evidenced by a promissory note in
such amount dated February 22,2011 executed by said borrower.
SA C-10
PROMISSORY NOTE
IN FAVOR OF RANCHO PALOS VERDES REDEVELOPMENT AGENCY
(Crestridge Senior Housing Project)
$6,790,000
3%Interest
Rancho Palos Verdes,California
December ~,2009
FOR VALUE RECEIVED,AMCAL MIRANDELA FUND,L.P.,a California limited
partnership ("Borrower")hereby promises to pay to the Rancho Palos Verdes Redevelopment
Agency,a public body,corporate and politic ("Agency"),or order,a principal amount of Six
Million,Seven Hundred Ninety Thousand Dollars ($6,790,000)or so much thereof as may be
advanced by Agency to the Borrower pursuant to the Disposition and Development Agreement
dated March 20,2009,between the Borrower and Agency (the "DDA"),plus interest as provided
below.Except as defined differently herein,all defined terms shall have the meaning set forth in
the DDA.This Note is made pursuant to the terms of the DDA,a Regulatory Agreement of even
date herewith (the "Agency Regulatory Agreement")and a deed of trust (the "Agency Trust
Deed")of even date herewith given by the Borrower to Agency for the purpose of securing this
Note (collectively,the "Agency Agreements").The Agency Agreements are public records on
file in the offices of Agency,and the provisions of these documents are incorporated herein by
this reference.
1.This Note evidences the obligation of the Borrower to Agency for the repayment
of funds loaned to the Borrower by Agency in an amount not to exceed the sum of Six Million,
Seven Hundred Ninety Thousand Dollars ($6,790,000;the "Agency Loan"),to finance certain
predevelopment costs,the acquisition of a portion of the real property described in the Agency
Trust Deed (the "Site"),and the construction of certain improvements thereon.The outstanding
balance of the Agency Loan shall accrue interest at the rate ofthree percent (3%)per annum,
simple interest,on the amount disbursed from the date of disbursement.
2.Repayment of Agency Loan.
(a)The Agency Loan shall be repaid annually,commencing on the first May
1st at which Net Available Cash Flow is available and each May 1st thereafter.The Agency
Loan shall be repaid out of the Net Available Cash Flow;except as set forth in subsections (c),
(d)and (e)of this Paragraph 2,Developer shall not be obligated to make any payment of
principal or interest on the Agency Loan except to the extent of Net Available Cash Flow.In
addition to the provisions of Paragraph 3 of this Note,the Agency Loan shall be repaid upon the
occurrence of any of the events set forth in subsections (c),(d)and (e)of this Paragraph 2.
(b)The Agency Loan shall be repaid in accordance with subparagraph (c)of
Paragraph 3.
(c)Subject to the rights of the Holder of any senior Mortgage,should the
Development be sold or refinanced (to the extent permitted by the DDA),including syndication
(other than the initial syndication for purposes of the Tax Credits),prior to the time that the
R6874-0001\1176743v2.doc Page 1 of 5 12/10/09
SA C-11
Agency Loan is repaid in full,the Net Proceeds of such sale or refinancing shall be paid to
Agency and credited against the Agency Loan,first against any outstanding principal and then
against the outstanding interest amount,ifany.Any portion of the Net Proceeds that exceeds the
outstanding balance of the Agency Loan (principal and interest)may be retained by Borrower.
For the purpose of this subparagraph,"Net Proceeds"is defined as proceeds of the transaction
less debt repaid and reasonable costs ofthe transaction.
(d)The Agency Loan shall be due and payable immediately if the
Development,or any portion thereof or interest therein,is sold,transferred (except for any of the
Permitted Transfers as provided in the DDA),assigned or refinanced without the prior written
approval of Agency,or if the DDA is terminated after close of Escrow as provided in the DDA.
(e)Unless paid in full earlier,the remaining balance ofthe Agency Loan shall
be due and payable in full fifty-five (55)years from the date of the Certificate of Completion
issued pursuant to Section 5.16 of the DDA.
3.Calculation of Net Available Cash Flow:Distribution
(a)"Net Available Cash Flow"shall mean the Operating Income,less the sum
of (i)Debt Service,(ii)Operating Expenses,(iii)deposits made to the Operating Reserve and the
Replacement Reserve,(iv)an asset management fee payable to the general partner of the
Developer in an amount described in any Agreement of Limited Partnership,as amended and/or
restated from time to time,of the Developer (the "Partnership Agreement"),subject to the
Agency's approval,(v)a fee payable to the administrative general partner of the Developer in an
amount described in the Partnership Agreement,subject to the Agency's approval (vi)a limited
partner asset management fee payable to one or more of the limited partners ofthe Developer in
an amount described in the Partnership Agreement,subject to the Agency's approval;provided
however,the aggregate amount of the fees described in the foregoing subparagraphs (iv),(v),
and (vi)shall not exceed the sum of Fifteen Thousand Dollars ($15,000.00),and (vii)an annual
audit fee,in an amount not to exceed an aggregate amount for each calendar year that is within
custom and standard of certified public accountants practicing in Los Angeles County who
prepare annual audits for comparable properties.If such calculation results in a negative
number,Net Available Cash Flow shall be zero for that year.
(i)"Debt Service"shall mean the periodic payments made in
connection with the permanent financing on the Project provided by a third party commercial
lender upon commercially reasonable terms which is secured by a first trust deed recorded
against the Project.
(ii)"Operating Expenses"shall mean actual,reasonable and customary
costs,fees,and expenses directly incurred and attributable to the operation,maintenance,and
management of the Development including,but not limited to,painting,cleaning,repairs and
alterations;landscaping;utilities;rubbish removal;certificates,permits and licenses;sewer
charges;real and personal property taxes and assessments;insurance;securities;advertising,
promotion and publicity;office,janitorial,cleaning and building supplies;purchase,repairs,
servicing and installation of appliances,equipment,fixtures and furnishings;expenditures for
R6874-0001\1176743v2.doc Page 2 of5 12/10/09
SA C-12
capital improvements,equipment,fixtures and furnishings that are not paid from the
Replacement Reserve;fees and expenses of property management and common area expenses;
and other actual operating costs and capital costs which are incurred and paid by the Developer,
but which are not paid from reserve accounts;and reasonable fees and expenses of accountants,
attorneys,consultants and other professionals.Payments to parties related to Developer for
Operating Expenses must not exceed prevailing market rates.The Operating Expenses shall not
include non-cash expenses,including without limitation,depreciation.
(iii)"Operating Income"shall mean the gross rental income from the
Site,and any other income Developer derives from the ownership,operation and management of
the Development,and the proceeds of insurance after a casualty loss (to the extent not used to
repair or rebuild the Improvements)and the proceeds of any condemnation proceedings.
"Opera~ing Income"shall not include tenants'security deposits or interest earned on reserve
accounts.
(iv)"Operating Reserve"shall mean the operating reserve account
maintained in accordance with Section 10327 (c)(8)(C)of the TCAC Regulations.
(v)
Section 4 of this Note.
"Replacement Reserve"shall mean the account described in
(b)The amount of the Net Available Cash Flow shall be determined on the
basis of an annual statement,for the preceding calendar year,beginning with the first year of
operation of all or any part of the Development,prepared at Developer's expense by an
independent certified public accounting firm acceptable to Agency.Developer shall submit the
annual statement and any payment (pursuant to subsection (c)of this Paragraph 3)to Agency not
later than May]st of each year,commencing on the first May 1st that is at least twelve months
after the issuance of a certification of occupancy for all or any of the units to be constructed on
the Site.Agency shall review and approve such statement,or request revisions,within thirty
(30)days after receipt.In the event that as the result of Agency review,there is an increase in
the amount of Net Available Cash Flow,Developer shall pay to Agency the Agency's share of
the full amount of such increase within ten (10)days of notice of the increase.
(c)Annually,the Net Available Cash Flow shall be distributed as follows:
(i)to Developer,to repay the Developer Loan,if any,subject to the
limitations in subsection (d)of this Paragraph 3);
(ii)fifty percent (50%)of the Net Available Cash Flow remaining after
the annual payment on the Developer Loan shall be paid to Agency,to repay the Agency Loan
(iii)fifty percent (50%)of the Net Available Cash Flow remaining after
the annual payment on the Developer Loan shall be retained by Developer.
(d)"Developer Loan"shall mean the deferred payment to Developer or
AMCAL Enterprises Inc.ofa portion of its Developer fee,if required.The Developer Loan may
accrue interest at the annual rate of three percent (3%)simple interest,commencing on the date
R6874-0001 \1 176743v2.doc Page 3 of5 12110109
SA C-13
that is twelve (12)months after the date that the following events have occurred:(i)issuance of
Certification of Completion for the Development and (ii)the events set forth in Section 7.4.1(b)
of the DDA.
4.Replacement Reserve
(a)Commencing one year after the issuance of a Certificate of Completion for
the Development,or within 30 days of funding of the permanent loan or conversion of the
construction loan to permanent loan,whichever occurs first,Developer shall establish and
thereafter maintain,in a depository acceptable to the Executive Director,a reserve fund to be
known as the "Replacement Reserve,"The Replacement Reserve contributions shall be set at
Two Hundred and Fifty Dollars ($250,00)per unit per year,or such greater amount as may be
required by other project lenders.Developer shall be credited with Replacement Reserve
deposits made by it as required by other project lenders.The Replacement Reserve shall remain
in the form of cash,and shall include all income earned thereon.The Replacement Reserve shall
be maintained during the period when any Agency Loan balance remains outstanding.
(b)Disbursements from the Replacement Reserve shall be for the purpose of
replacing structural elements or equipment of the Development,or for any other purpose
consistent with maintaining the physical or financial integrity of the Development.Annually,
Developer shall submit a report,with supporting documentation,in form satisfactory to the
Executive Director,of all expenditures from the Replacement Reserve.If,in the reasonable
opinion of the Executive Director,any expenditure was not appropriately made from the
Replacement Reserve,Developer will deposit the amount of the expenditure into the
Replacement Reserve fund within ten (10)days of written notice by Agency;provided,however,
if an expenditure was approved by another project lender authorized by this Agreement,it shall
be deemed to be reasonable.
(c)In the event of a default by Developer under this Agreement or of a default
or event of default under the Agency Note or the DDA,or of a foreclosure by the holder of a
senior Mortgage,funds in the Replacement Reserve shall be used for the continued operation of
the Development.
5.This Note is payable at the principal office of Agency,30940 Hawthorne Blvd.,
Rancho Palos Verdes,California 90274,or at such other place as the holder hereof may inform
the Borrower in writing,in lawful money of the United States.
6.The Borrower waives presentment for payment,demand,protest,and notices of
dishonor and of protest;the benefits of all waiveable exemptions;and all defenses and pleas on
the ground of any extension or extensions of the time of payment or of any due date under this
Note,in whole or in part,whether before or after maturity and with or without notice.The
Borrower hereby agrees to pay all costs and expenses,including reasonable attorney's fees,
which may be incurred by the holder hereof,in the enforcement of this Note or any term or
provision hereof
R6874-0001 \1 I 76743v2.doc Page 4 of5 12/10/09
SA C-14
7.The loan evidenced hereby is a nonrecourse obligation of Borrower.Neither
Borrower,its partners,general or limited,their assignees,nor any other party,shall have any
personal liability for any obligation associated with the loan evidenced hereby,or arising under
any other document evidencing,describing,securing or in any other way relating to the loan
evidenced hereby.The sole recourse of the holder hereof for obligations associated under such
other documents,shall be the exercise of the holder hereofs rights against the collateral pledged
to secure the loan.Notwithstanding the foregoing provisions,to the extent permitted by law,the
Borrower shall be fully liable to the holder hereof,and the holder hereof shall be entitled to
obtain a personal or deficiency judgment for all actual losses or damages suffered by holder
(including without limitation all court costs,attorneys'fees and other costs and expenses
incurred by the holder)as a result of (a)the Borrower's intentional fraud in connection with the
delivery of and performance of its obligations under the Agency Agreements,or otherwise
relating.to the indebtedness evidenced by the Note,(b)misapplication or wrongful retention of
rental income or casualty insurance or condemnation proceeds attributable to the security
property after holder has given Borrower notice that Borrower is in default under any of the
Agency Agreements and the period for cure has expired,(c)removal of personal property or
fixtures from the Property in violation of the provisions of the Agency Agreements,(d)the
Agency of any act of deliberate waste with respect to the Property by the Borrower or any of the
parties or entities comprising Borrower or any constituent entities of the Borrower,or (e)any
breach of the provisions of the Agency Agreements dealing with hazardous or toxic material or
wastes.
BORROWER
AMCAL MIRANDELA FUND,L.P.,
a California limited partnership
BY:AMCAL Multi-Ho
its administrative gener
By:
Nam£~~-----'--
Its:President
By DJ{~/L--
Name:David Yard en
Its:Vice President &General Counsel
By:Las Palm as Foundation,a California Nonprofit
corporation,its general partner
By:
Name:Joseph M.Michaels
Its:President
R6874-0001\1176743v2.doc Page 5 of5 12/10/09
SA C-15
7.The loan evidenced hereby is a nonrecourse obligation of Borrower.Neither
Borrower,its partners,general or limited,their assignees,nor any other party,shall have any
personal liability for any obligation associated with the loan evidenced hereby,or arising under
any other document evidencing,describing,securing or in any other way relating to the loan
evidenced hereby.The sole recourse ofthe holder hereof for obligations associated under such
other documents,shall be the exercise ofthe holder hereofs rights against the collateral pledged
to secure the loan.Notwithstanding the foregoing provisions,to the extent permitted by law,the
Borrower shall be fully liable to the holder hereof,and the holder hereof shall be entitled to
obtain a personal or deficiency judgment for all actual losses or damages suffered by holder
(including without limitation all court costs,attorneys'fees and other costs and expenses
incurred by the holder)as a result of (a)the Borrower's intentional fraud in connection with the
delivery of and performance of its obligations under the Agency Agreements,or otherwise
relating to the indebtedness evidenced by the Note,(b)misapplication or wrongful retention of
rental incbme or casualty insurance or condemnation proceeds attributable to the security
property after holder has given Borrower notice that Borrower is in default under any of the
Agency Agreements and the period for cure has expired,(c)removal of personal property or
fixtures from the Property in violation of the provisions of the Agency Agreements,(d)the
Agency of any act of deliberate waste with respect to the Property by the Borrower or any of the
parties or entities comprising Borrower or any constituent entities of the Borrower,or (e)any
breach of the provisions of the Agency Agreements dealing with hazardous or toxic material or
wastes.
BORROWER
AMCAL MIRANDELA FUND,L.P.,
a California limited partnership
BY:AMCAL Multi-Housing,Inc.,
its administrative general partner
By:
Name:Percival Vaz
Its:President
By:
Name:David Varden
Its:Vice President &General Counsel
By:
Name:
Its:
R6874-000 1\1176743v2.doc Page 5 of5 12/10/09
SA C-16
PROMISSORY NOTE SECURED BY DEED OF TRUST
$126,320.00 February 22,2011
Rancho Palos Verdes,California
1.Basic Tenns.
For value received,the undersigned ("Owner")promises to pay to the order of the
RANCHO PALOS VERDES REDEVELOPMENT AGENCY,a public body,corporate and
politic (the "Lender")at 30940 Hawthorne Boulevard,Rancho Palos Verdes,CA 90275,or at
such other place as Agency may from time to time designate in writing,the principal amount of
One Hundred Twenty Six Thousand-Three Hundred Twenty Dollars ($126,320)Iili!!i the Equity
Share described in the Regulatory Agreement executed by Owner and dated substantially
concurrently herewith..Notwithstanding anything tQ the contrary herein,this Promissory Note
Secured by Deed of Trust (''Note'')is intended to evidence a "conditional grant"that is intended
to increase the supply of low and moderate income housing in the City of Rancho Palos Verdes
and provide a means (specifically,the deed ofttust seCl.\flng this Note)to help ensure compliance
with the Regulatory Agreement that restricts the residence that is coUateral for this Note to
ownership and oocupancy by low or moderate income households at an affordable housing cost.
2.Maturity Date and Payments.
All unpaid principal under this Note shall be due and payable upon a default by
the Owner (or any successor Owner)under the Regulatory Agreement;provided,that if no such
default has OCCUlTed by the date that is forty-five (45)years after the date hereof,then no
principal shall be payable and the grant evidenoed hereby shall become "unconditional".
3.Prepayment.
Owner may prepay the outstanding principal balance under this Note,in whole or
in part,and other sums owed tQ Lender under this Note,at any time without premium or charge.
4.Lawful Money.
All amounts shall be payable in lawful money of the United States of America.
5.Security.
This Note is secured by that certain Deed of Trust,Security Agreement and
Fixture Filing (with Assignment of Rents)dated of substantially even date herewith and executed
by Owner,as truslor,in favor of Lender,as beneficiary (the "Deed ofTrust"').
6.Acceleration by Reason of Transfer or Financing.
Prior to the repayment in full of this Note and the full release and reconveyance of
the Deed of Trust,the Owner shall not make any sale,transfer,conveyance or assignment of the
whole or any part of the real property described in the Deed of Trust,or any portion thereof or
R6874·030 1\12S0783 v I.doc
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interest therein,or further encumber such real property without the prior written consent of the
Lender except as otherwise expressly permitted in the Regulatory Agreement.
In the event of a violation of the preceding paragraph or any other default under
the Regulatory Agreement,Lender may declare the outstanding principal amount of this Note to
be due and payable immediately.
7.Events of Default.The occurrence of a curable default by Owner under the Deed
of Trust or the Regulatory Agreement that is not cured within thirty (30)days after written notice
from Lender shall also constitute a default under this Note and shall entitle Lender to declare all
principal due.
8.Remedies;Default Interest Rate
Upon the occurrence of a default under this Note or a violation of Section 6
above,at the option of Lender,the entire balance of principal together with any other amounts
owed by Owner to Lender under the Deed of Trust,shall,without demand or notice,immediately
become due and payable.No delay or omission on the part of Lender in exercising any right
under this Note shall operate as a waiver of such right.
9.Waiver.
Owner hereby waives diligence,presentment,protest and demand,notice of
protest,dishonor and nonpayment of this Note,and expressly agrees that,without ill any way
affecting the liability of Owner hereunder,Lender may elctend any maturity date or the time for
payment of any installment due hereWlder,accept additional security,release any party liable
hereunder and release any security now or hereafter securing this Note.Owner further waives,to
the fullest extent permitted by law,the right to plead any and all statutes of limitations as a
defense to any demand on this Note,or on any deed of trust,security agreement,guaranty or
other agreement now or hereafter securing this Note.
\0,Attorneys'Fees.I
\..
If this Note is not paid when due or if any Event of Default occurs,Owner
promises to pay all costs of enforcement and coUection,including but not limited to reasonable
attorneys'fees,whether or not any action or proceeding is brought to enforce the provisions
hereof.
11.Severa.bility.
Every provision of this Note is intended to be severable.[n the event any term or
provision hereof is declared by a court of competent jurisdiction to be illegal or invalid for any
reason whatsoever,such illegality or invalidity shall not affect the balance of the terms and
provisions hereof,which terms and provisions shall remain binding and enforceable.
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12.Number and Gender.
In tIus Note the singular shall include the plural and the masculine shall include
the feminine and neuter gender,and vice versa,if the context so requires.
OWNER rk-:1 lU .
Mercedes Adrian1;ma
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SA C-19
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:>f DEPARTMENT C1F EOMUND G.BROWN JR.•GOVERNOR°"'l(,/"O~"\"FIN A N C E------9-15----L...."S-TR-E-ET-.~S...-C-R-...M-E-N-TO--=C-:-A-=.-::9:-::5-=B-:-14-:-.-=3=-7Cl=-6~.-W-WW-.-D-OF-.C-A-.G-O-V
August22,2012
Mr.Dennis McLean,Director
Finance and Information Technology
City of Rancho Palos Verdes
30940 Hawthorne Boulevard
Rancho Palos Verdes.CA 90275-5391
Dear Mr.McLean:
Subject:Housing Assets Transfer Form
Pursuant to Health and Safety Code (HSC)section 34176 (a)(2),the City of Rancho Palos
Verdes submitted a Housing Assets Transfer Form (Form)to the California Department of
Finance (Finance)on July 24,2012 for the period February 1,2012 through July 24,2012.
Finance has completed its review of your Form,which may have included obtaining clarification
for various items.Based on a sample of line items reviewed and the application of law,Finance
is not objecting to any assets or transfers of assets identified on your Form.
Please direct inquiries to Evelyn Suess,Supervisor or Michael Barr,Lead Analyst at
(916)445-1546.
Sincerely,
~~
,/C::;;I!.
·,·-·/"STEVE SZALAY
Local Government Consultant
cc:Ms.Katherine Downs,Deputy Director of Finance and Information Technology,City of
Rancho Palos Verdes
Ms.Kristina Burns,Program Specialist III,Los Angeles County Auditor-Controller's
Office
California State Controller's Office
SA C-20