HomeMy WebLinkAbout2014-03-07 Correspondence re: Form of Lender Estoppel Certificate }
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�RpYO GRANDE CITY OF
ARROYO GRANDE
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EXHIBIT M
Form of Lender Estoppel Certificate
March 7, 2014
Merritt Community Capital Fund XV, L.P.
do Merritt Community Capital Corporation
1970 Broadway, Suite 250
Oakland, CA 94612
Ladies and Gentlemen:
Re: Loan from City of Arroyo Grande ("Lender") to Courtland Street Apartments,
L.P., a California limited partnership (the "Partnership')
Ladies and Gentlemen:
We refer to (i)that certain loan in the original principal amount of$930,000,made by
Lender to Partnership (the"Loan No. 1") evidenced and secured by various documents dated as
of March 28, 2013 (the"Loan No. 1 Loan Documents"),made in connection with the
Partnership's acquisition and development of a multifamily rental development for low-income
persons located at 150 South Courtland Street,Arroyo Grande, California(the"Project'),
pursuant to that certain Affordable Housing and Loan Agreement between Lender and
Partnership (the"Original AHLA") and(ii)that certain loan in the original principal amount of
up to $400,000,made or agreed to be made by Lender to Partnership (the "Loan No.2")
evidenced and secured by various documents dated as of August 13, 2013 (the"Loan No.2
Loan Documents"), made in connection with the Partnership's development of the Project,
pursuant to that certain Amendment No. 1 to Affordable Housing and Loan Agreement (the
"Amendment No. 1"). The Original AHLA, as modified by Amendment No. 1, is hereinafter
referred to as the "AHLA." The Loan No. 1 Loan Documents and the Loan No. 2 Loan
Documents are hereinafter collectively referred to as the"Loan Documents," and are listed on
Exhibit A hereto.
You have asked that we provide you, as investor limited partner of the Partnership, with
certain information and representations concerning the Loan Documents and the status of Loan
No. 1 and Loan No. 2. We understand that you will be relying upon the information contained in
this Estoppel Certificate, which is a condition precedent to your making a capital contribution
required pursuant to the First Amended and Restated Agreement of Limited Partnership of the
Partnership.
The undersigned hereby certifies to you and your successors, assigns, affiliates and/or
designees (collectively,the"Limited Partner") as of the date hereof the following, all as of the
date of this Estoppel Certificate:
CITY MANAGER'S OFFICE • 300 E. Branch Street • Arroyo Grande, California 93420
Phone: (805) 473-5400 • FAX: (805) 473-0386 • E-mail: agcity@arroyogrande.org • Website: www.arroyogrande.org
1. The Loan Documents are in full force and effect and have not been amended or
modified. Other than the Loan Documents,there are no other documents,
agreements or instruments evidencing or securing Loan No. 1 or Loan No. 2. The
outstanding principal balance of Loan No. 1 is $930,000; no portion of Loan No.
2 has, of the date of this Estoppel Certificate,been disbursed to the Partnership.
2. Lender has not given any notice of default to the Partnership that has not been
cured and,to the best of Lender's actual knowledge,no events or circumstances
presently exist which, with giving of notice or passage of time, or both,would
constitute a default by the Partnership under the Loan Documents. As used
herein, "Lender's actual knowledge" shall mean the actual knowledge of the City
Manager of the City of Arroyo Grande,without,duty of inquiry or investigation.
3. The undersigned Lender acknowledges and agrees that the Limited Partner, and
its successors and assigns, are relying upon the contents of this Estoppel
Certificate and the Lender's execution hereof, and that in consideration of such
material reliance the Lender shall now and forever be estopped from denying the
validity of this Estoppel Certificate and Lender knowingly and expressly waives
any such claim or defense arising from the validity of this Estoppel Certificate;
and
4. The undersigned has the power and authority to execute this Estoppel Certificate
on behalf of the Lender.
IN WITNESS WHEREOF,this Estoppel Certificate has been executed this % day of
77d , 20/'/.
LENDER:
[Lender]
By:
Name: ,,c-71.e ;. /eld :sus
Title: )77.‘-A Gs
Exhibit A—Loan Documents
Affordable Housing and Loan Agreement, dated as of March 28, 2013,by and between Lender
and the Partnership
Deed of Trust with Assignment of Rents, dated as of March 28, 2013, executed by the
Partnership, securing Loan No. 1 [Instrument No. 2013-018879]
Promissory Note Secured by Deed of Trust, dated as of March 28, 2013, executed by the
Partnership, evidencing Loan No. 1
Regulatory Agreement and Declaration of Covenants and Restrictions, dated March 28,2013,
by and between Lender and the Partnership [Instrument No. 2013-018875]
Notice of Affordability Restrictions on Transfer of Property, dated March 28, 2013, executed by
Lender and by the Partnership [Instrument No. 2013-018880]
Subordination Agreement(Bank of America("BOA"), dated March 28, 2013, among Lender,
the Partnership, and BOA [Instrument No. 2013-018885]
Subordination Agreement [Regulatory Agreement] (Bank of America("BOA"), dated March 28,
2013, among Lender, the Partnership, and BOA [Instrument No. 2013-018886]
Subordination Agreement(San Luis Obispo County Housing Trust Fund("Fund"), dated March
28, 2013 [Instrument No. 2013-018888]
Subordination Agreement(County of San Luis Obispo ("County"), dated March 28, 2013,
between Lender and the County[Instrument No. 2013-018889]
Estoppel Certificate, dated as of March 28, 2013, executed by the Partnership and the Lender
Assignment,Assumption and Modification Agreement, dated March 28, 2013,between People's
Self-Help Housing Corporation,the Partnership, and Lender
Amendment No. 1 to Affordable Housing and Loan Agreement, dated as of August 13, 2013,by
and between Lender and the Partnership
Deed of Trust with Assignment of Rents, dated as of August 13, 2013, executed by the
Partnership, securing Loan No. 2 [Instrument No.2013051251]
Promissory Note Secured by Deed of Trust, dated as of August 13, 2013, executed by the
Partnership, evidencing Loan No. 2