Loading...
HomeMy WebLinkAboutContract 45031 (2)STATE OF TEXAS COUNTY OF TARRANT CITY SECRETARY coN'rRAcT NO. This contract ("Contract") is made and entered into by and between the City of Fort Worth (hereafter "City") and Western Center Reserve , LLC (hereafter "Developer"), a Texas limited liability company. City and Developer may be referred to individually as a "Party" and jointly as "the Parties". The Parties state as follows: WHEREAS, City has received a grant from the United States Department of Housing and Urban Development through the HOME Investment Partnerships Program, Catalog of Federal Domestic Assistance No. 14.239, with which City desires to promote activities that expand the supply of affordable housing and the development of partnerships among City, local governments, local lenders, private industry and neighborhood -based nonprofit housing organizations; WHEREAS, the primary purpose of the HOME program pursuant to the HOME Investment Partnerships Act at Title II of the Cranston Gonzales National Affordable Housing Act of 1990, as amended, 42 U.S.C. 12701 et seq. and the HOME Investment Partnerships Program Final Rule, as amended, 24 CFR Part 92 et seq. is to benefit low income citizens by providing them with affordable housing; WHEREAS, Developer is a Texas limited liability company consisting of MV Western Center Reserve, LLC, an Ohio limited liability company, as Managing Member; MV Special Member, LLC, an Ohio limited liability company as Class "B" Managing Member; Albatross Development, LLC, a Texas limited liability company and Historically Underutilized Business as Project Member; Bank of America, N.A. as Investor Member; and Banc of America CDC Special Holding Company, Inc., a North Carolina corporation, as Special Member. The Managing Member is a single purpose entity 100% owned by MV Affordable Housing LLC, an Ohio limited liability company, which is controlled by Miller -Valentine Operations, Inc., an Ohio corporation. WHEREAS, Developer proposes to use HOME funds for an eligible project under the HOME Regulations whereby Developer will construct, develop, own and operate a new 120-unit multifamily rental complex in the City of Fort Worth; WHEREAS, Developer has received an award of Housing Tax Credits from the Texas Department of Housing and Community Affairs to finance the development of the project to be commonly known as the Reserve at Western Center; and WHEREAS, City citizens and the City Council have determined that the development of quality, accessible, and affordable housing is needed for moderate, low, and very low-income City citizens. oP$It1AL RECORD II CITY 3ECRIIARY ft WORM TX RECEIVE RECEIVED NOW, THEREFORE, in consideration of the mutual covenants and obligations and responsibilities contained herein, including all Exhibits and Attachments, and subject to the terms and conditions hereinafter stated, the Parties understand and agree as follows: 1. INCORPORATION OF RECITALS. City and Developer hereby agree that the recitals set forth above are true and correct and foiin the basis upon which the Parties have entered into this Contract. 2. DEFINITIONS. In addition to terms defined in the body of this Contract, the following terms shall have the definitions ascribed to them as follows: Accessible Units means units accessible to handicapped tenants. Developer must comply with Section 504 requirements and all other applicable Federal accessibility requirements. The Required Improvements must contain _ Accessible Units. Of these 9 units, 6 must be accessible to individuals with mobility impairments, and the other 3 must be accessible to individuals with visual or hearing impairments. Act means the HOME Investment Partnerships Act at Title II of the Cranston Gonzales National Affordable Housing Act of 1990, as amended, 42 U.S.C. 12701 et seq. Affordable Rent means a rent amount that does not exceed the High HOME Rent Limit published annually by HUD, with applicable adjustment for the bedroom size of the relevant housing unit as more particularly described on Exhibit "A" - Project Summary. Affordability Period means the period of time that HOME Units must be leased to HOME Eligible Households for Affordable Rent. The Affordability Period for this project is 20 years. The Affordability Period begins on the date that the project status is changed to ` complete' in IDIS, HUD's project tracking system. Affordability Requirements means the HOME Units remain occupied by HOME Eligible Households paying Affordable Rent throughout the Affordability Period in accordance with the terms of this Contract and the HOME Regulations. Area Median Income or AMI means the median family income for the Fort Worth -Arlington metropolitan statistical area as set annually by HUD. Business Diversity Enterprise Ordinance or BDE means the City's Business Diversity Ordinance, Ordinance No. 20020-12-2011. Complete Documentation means the following documentation as applicable: HOME DEVELOPER RENTAL CONTRACT Rev 10-17-13 Western Center Reserve, LLC Page 2 • Attachments I and II, with supporting documentation as follows: o Proof of expense* invoices leases service contracts or other documentation showing that payment is due by Developer. o Proof of payments cancelled checks, bank statements, or wire transfers necessary to demonstrate that amounts were actually paid by Developer. • Other documentation: (i) final lien releases signed by the general contractor or subcontractors, if applicable; (ii) copies of all City permits and City -issued "pass" inspections for such work (iii) documentation to show compliance with BDE or DBE bidding process for procurement or Contract activities, if applicable; (iv) proof of contractor, subcontractor and vendor eligibility as described in Section 6.6; and (v) any other documents or records reasonably necessary to verify costs spent for the project. • Complete Documentation shall meet the standards described in the attached Exhibit "J" - Standards for Complete Documentation. • Final reimbursement shall not be made until all liens are released to City's satisfaction. Completion means the substantial completion of the Required Improvements, as evidenced by a HED Department Minimal Acceptable Standard Inspection report HUD Compliance Inspection Report and any other applicable final inspection approval from the City showing that the Required Improvements have met City and HOME standards. Completion Deadline means December 31, 2014. DBE means disadvantaged business enterprise as defined at 49 CFR Part 26.5. Deed of Trust means any deed of trust from Developer in favor of City covering the Property and securing the indebtedness evidenced therein and Developer's performance of the requirements of this Contract and the of the HOME Regulations, as the same may be extended, amended, restated, supplemented or otherwise modified. The form of the Deed of Trust is attached as Exhibit "E" - Loan Documents. Director means the Director of the City's HED Department Effective Date means the date of this Contract is fully executed by the Parties as shown by the date written under their respective signatures. Fort Worth Housing Authority means the Housing Authority of the City of Fort Worth, a Texas municipal housing authority. HED Department means the City's Housing and Economic Development Department. HOME means the HOME Investment Partnerships Program. HOME DEVELOPER RENTAL CONTRACT Rev 10-17-13 Western Center Reserve, LLC Page 3 HOME Eligible Household means a household whose annual income adjusted for family size does not exceed 80% of AMI using the most current HUD Income Guidelines and Technical Guidance for Determining Income and Allowances. The definition of annual income to determine tenant income eligibility shall be the definition contained in 24 CFR Part 5.609, as amended from time to time. HOME Funds means the HOME Program grant funds supplied by City to Developer under the terms of this Contract. HOME Regulations means the HOME Investment Partnerships Program Final Rule found at 24 CFR Part 92 et seq. HOME Unit means a housing unit subject to the HOME Regulations leased to a HOME Eligible Household at Affordable Rent for the duration of the Affordability Period as further described in Exhibit "A" - Project Summary. The HOME Units can be designated as either High and/or Low HOME units. The HOME Units are floating. This project contains 4 Home Units. Of these HOME Units, 1 is a one -bedroom unit, 2 are two -bedroom units, and 1 is a three -bedroom unit. High HOME Unit means a unit that must be leased to High HOME Eligible Tenant for High HOME Rent. High HOME Units can float among units that are materially similar in number of bedrooms, square footage, and amenities; however, if the units are not materially similar, then the High HOME units must be fixed. This project contains 4 High HOME Units High HOME Eligible Tenant means (i) for a tenant who is the first to occupy a High HOME Unit, a tenant whose annual income adjusted for family size does not exceed 60% of AMI, and (ii) for a tenant who is not the first to occupy a High HOME Unit, a tenant whose annual income adjusted for family size does not exceed 80% of AMI. Tenant income must be verified using the most current HUD Income Guidelines and Technical Guidance for Determining Income and Allowances subject to the income verification requirements of Section 7 2 of this Contract. High HOME Rent means a rent amount that is the lesser of (i) the HUD -established Fair Market Rent for existing comparable housing units in the area or (ii) 30% of the adjusted income of a family whose annual income equals 65% of AMI with applicable adjustment for the bedroom size of the relevant housing unit. High Home Rent may not exceed the maximum rent limitations established by HUD minus utility allowances. For the purposes of this Contract, `utility allowances ' are those monthly allowances for utilities (excluding telephone) published annually by the Fort Worth Housing Authority. Housing Tax Credits means the federal low income housing tax credits allocated by the Texas Department of Housing and Community Affairs acting under Section 42(h) of the Internal Revenue Code of 1986, as amended. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 4 HUD means the United States Department of Housing and Urban Development. IDIS means HUD's Integrated Disbursement Information System. Investor Member means Bank of America, N.A., and any successors and assigns. Loan Documents means security instruments which Developer or any other party has executed and delivered to City including without limitation, the City's Promissory Note and Deed of Trust, or any other similar security instruments evidencing, securing or guaranteeing City's interest in the Required Improvements constructed under this Contract and further evidencing, securing, or guaranteeing Developer's performance of the Affordability Requirements during the Affordability Period, as the same may from time to time be extended amended, restated, supplemented or otherwise modified. Low HOME Eligible Tenant means a tenant whose annual income adjusted for family size does not exceed 50% of AMI. Tenant income must be verified using the most current HUD Income Guidelines and Technical Guidance for Determining Income and Allowances subject to Section 7.2 of this Contract. Low HOME Rent means a rent amount that is no more than 30% of the annual income of a family at 50% of AMI adjusted for family size Low Home Rent may not exceed the maximum rent limitations established by HUD minus utility allowances. For the purposes of this Contract, "utility allowances' are those monthly allowances for utilities (excluding telephone) published annually by the Fort Worth Housing Authority. Low HOME Unit means a unit that must be leased to Low HOME Eligible Tenant for Low HOME Rent. Low HOME Units can float among units that are materially similar in number of bedrooms, square footage, and amenities; however, if the units are not materially similar, then the Low HOME units must be fixed. If there are more than 5 HOME Units, then 20% of the total HOME units must be designated as Low. This project contains 0 Low HOME Units. Plans means the plans and specifications related to the Required Improvements prepared by the Developer s architect which have been delivered to and then reviewed and approved by City on or before the Effective Date, and any and all amendments thereto approved by City. Promissory Note means any note in the amount of the HOME Funds executed by Developer payable to the order of City, as the same may be extended, amended restated, supplemented or otherwise modified. The foiin of the Promissory Note is attached as Exhibit ‘E" - Loan Documents. Property means the land on which the Required Improvements shall be constructed as more particularly described in and encumbered by the Deed of Trust. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 5 Required Improvements or the project means all the improvements for a 120-unit affordable rental housing project to be constructed on the Property, together with all fixtures, tenant improvements and appurtenances now or later to be located on the Property and/or in such improvements. The Required Improvements are commonly known as the Reserve at Western Center. The project is located at the southwest corner of Western Center Blvd. and Watauga - Smithfield Road, Fort Worth, TX 76131. Reimbursement Request means all reports and other documentation described in Section 10. Section 504 requirements means the requirements of Section 504 of the Rehabilitation Act of 1973 to provide accessible housing to persons with disabilities. Section 504 requires that 5% of the units (but not less than 1 unit) in a newly constructed multifamily project must be accessible to individuals with mobility impairments, and an additional 2% of the units (but not less than 1 unit) must be accessible to individuals with sensory impairments. Subordination Agreement means the Subordination Agreement among Bank of America, N.A., Developer and City outlining the relative priorities of Bank of America s construction and permanent loan and the City's Loan for the project. TDHCA means the Texas Department of Housing and Community Affairs. Tenant Documentation means any documentation allowed under the definition of annual income in 24 CFR Part 5.609 sufficient to show that a tenant is a HOME Eligible Household. Documentation may include but is not limited to pay check stubs, Social Security statements, W- 2 foinis, and/or payments in lieu of earnings (unemployment) for initial tenant income eligibility verifications, and the tenant income verification required every 6th year of the Affordability Period. Documentation for tenant income eligibility verifications for other than the initial lease and the 6th year of the Affordability Period shall be a City approved income self -certification form. 3. TERM AND EXTENSION. 3.1 Term of Contract. The term of this Contract begins on the Effective Date and terminates in 3 years unless otherwise terminated as provided in this Contract. 3.2 Extension of Contract. This Contract may be extended for 1 year upon Developer submitting a request for an extension in writing at least 60 days prior to the end of the Contract term. The request for extension shall include the reasons for the extension and Developer's anticipated budget, construction schedule and goals and objectives for the extended term. It is specifically understood that it is within City s sole discretion whether to approve or deny Developer's request for an additional term. Any such extension must be in writing as an amendment to this Contract. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 6 3.3 Term of Loan. The term of the Loan shall commence on the date of the Promissory Note and terminate (i) for the repayment of the HOME funds, 3 years later unless extended as provided in Section 5.6.1, and (ii) for Developer's performance of the Affordability Requirements the expiration of the Affordability Period. The Loan, both as to payment and perfoiivance shall terminate at the expiration of the Affordability Period, so long as the terms and conditions of this Contract and the Loan Documents have been met. 4. DUTIES AND RESPONSIBILITIES OF CITY. 4.1 Provide HOME Funds. City shall provide up to Two Hundred Forty Thousand and No/100 Dollars ($240,000.00) of HOME Funds in the form of a subordinate loan to complete the construction of the Required Improvements, under the terms and conditions described herein (the "Loan"). 4.2 City Will Monitor. City will monitor the activities and performance of Developer and any of its contractors, subcontractors or vendors throughout the Affordability Period, but no less than annually as required by 24 CFR Part 92.504. 5. DUTIES AND RESPONSIBILITIES OF DEVELOPER. 5.1 Required Improvements Developer shall construct the Required Improvements as described in Exhibit "A" — Project Summary in accordance with the Plans the schedule set forth in Exhibit "C" - Construction and Reimbursement Schedule and the terms and conditions of this Contract. 5.2 Use of HOME Funds. 5.2.1 Compliance with HOME Regulations and Contract. Developer shall be reimbursed for eligible project costs with HOME Funds only if City determines in its sole discretion that: 5.2.1.1 Costs are eligible expenditures in accordance with HOME Regulations 5.2.1.2 Costs are in compliance with this Contract and are reasonable and consistent with industry norms. 5.2.1.3 Complete Documentation, as applicable, is submitted by Developer. 5.2.2 Budget. Developer agrees that the HOME Funds will be paid on a reimbursement basis in accordance with Exhibit "B" - Budget and Exhibit "C" - Construction and Reimbursement Schedule. Developer may increase or decrease line item amounts in the HOME Funds Budget with the Director s prior written approval, which approval shall be in the Director's sole HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 7 discretion, so long as the expenses are in compliance with Section 5.2.1 and Exhibit "A — Project Summary, and the total amount of HOME Funds is not increased. 5.2.3 Change in Project Budget. 5.2.3.1 Developer will notify City promptly of any additional funds it receives for construction of the project, and City reserves the right to amend this Contract in such instances to ensure compliance with HUD regulations governing cost allocation. 5.2.3.2 Developer agrees to utilize the HOME Funds to supplement rather than supplant funds otherwise available for the project. 5.3 Pavment of HOME Funds to Developer. HOME Funds will be disbursed to Developer upon City's approval of Developer's written and signed Reimbursement Requests, including submission of Complete Documentation to City in compliance with Section 10 As more particularly described in the HOME Funds Budget, City will hold back $10,000.00 of the HOME Funds until City verifies that a HOME Unit has been leased to a HOME Eligible Household. It is expressly agreed by the Parties that any HOME Funds not reimbursed to Developer in accordance with the terms of this Contract shall remain with City. 5.4 Identify Project Expenses Paid with HOME Funds. Developer will keep accounts and records in such a manner that City may readily identify and account for project expenses reimbursed with HOME Funds. These records shall be made available to City for audit purposes and shall be retained as required hereunder. 5.5 Acknowledgement of City Payment of HOME Funds. Within 90 days of Completion, Developer shall sign an acknowledgement that City has paid all HOME Funds due under this Contract, or shall deliver a document executed by an officer of Developer identifying all or any portion of the HOME Funds that City has not paid to Developer. Once City has met all of its obligations for payment of HOME Funds hereunder, an officer of Developer shall sign an acknowledgement of same. 5.6. Security for City's Interest. To secure City's interest in the Required Improvements and the performance of Developer's obligations hereunder, Developer shall execute the Loan Documents and record the Deed of Trust encumbering the Property at the closing of Developer's construction loan. No HOME Funds will be paid or reimbursed until the Deed of Trust is recorded. The City s interest in preserving the affordability of the HOME Units will be additionally secured by the Declaration of Land Use Restrictive Covenants ("LURA") established and enforced by TDHCA for the Housing Tax Credits. The TDHCA's LURA shall restrict the project and Property to certain occupancy and rent requirements for a period of 40 years. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 8 5.6.1 Loan Terms and Conditions. Developer will be required to: 5.6.1.1 Execute and deliver the Promissory Note and Deed of Trust along with any other Loan Documents required by City. 5.6.1.2 Provide City with a Mortgagee's Policy of title insurance in the amount of the Loan. 5.6.1.3 Pay all costs associated with closing the Loan. 5.6.1.4 Provide City with an estimated settlement statement from the title company at least 1 business day before closing 5.6.1.5 Ensure City's lien is subordinate only to the senior indebtedness described in the Subordination Agreement. City must approve in writing any secured financing for the project that is to be subordinate to the Loan. 5.6.1.6 The terra of the Loan shall be as specified in Section 3.3. If the project has not been placed in service within 3 years of the date of the Promissory Note, the time for repayment of the HOME Funds shall be extended for an additional year. 5.6.1.7 Interest shall accrue at the lesser of the Applicable Federal Rate in effect on the date of the Promissory Note, or 1 % per annum. The principal amount and any accrued unpaid interest will be payable in full on the maturity date set forth in the Promissory Note. Any payments will be applied first to accrued interest and the remainder to reduction of the principal amount. 5.6.1.8 Early repayment of the Loan shall not relieve Developer of its obligations under this Contract or the HOME Regulations including but not limited to the Affordability Requirements and other HOME requirements. The Deed of Trust shall secure both repayment of the HOME Funds and perfoinuance by Developer of its obligations under this Contract during the Affordability Period. 5.6.1.9 Except for permanent loan conversion with Developer's permanent lender, refinancing by Developer shall require the review and prior written approval of City for the purpose of ensuring compliance with the Affordability Requirements, which approval shall not be unreasonably withheld, conditioned or delayed 5.6.1.10 Any failure by Developer to comply with this Section 5 6 1 will be an event of default under this Contract and the Loan Documents HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 9 5.7 Maintain Affordability Requirements. Developer shall ensure that the HOME Units shall be occupied by HOME Eligible Households throughout the Affordability Period as required by the HOME Regulations. Developer must notify the City in writing within 30 days of either of the following occurrences* (i) a HOME Unit is occupied by a tenant who is not a HOME Eligible Household, or (ii) a HOME Unit remains vacant for more than 90 days In the event that a HOME Unit is occupied by a tenant who is not a HOME Ehgible Household, Developer shall have 30 days to determine if a market rate tenant qualifies as a HOME Eligible Household or fill an empty market rate unit with a HOME Eligible Household. If either (i) or (ii) takes place and is not cured within the time limits described in this Section, then Developer shall pay to City 10% of the Loan amount as liquidated damages. The Parties agree that City's actual damages in the event of either (i) or (ii) happening and remaining uncured are uncertain and would be difficult to ascertain and may include a finding by HUD, a repayment of funds to HUD by City or otherwise impact the City's HOME grant or other federal grant funds. Therefore, the Parties agree that payment under this Section of 10% of the Loan amount by Developer to City is liquidated damages and not a penalty. 5.8 Affordability Requirements Survive Transfer. The HOME Units must remain affordable without regard to the term of any mortgage or transfer of ownership, pursuant to the terms of the Loan Documents, any deed restrictions or other mechanism provided by HUD. Any sale or transfer of the project during the Affordability Period, excluding a transfer due to condemnation or to obtain utility services, may at City's sole discretion require the repayment of the HOME Funds unless the new owner or transferee affirmatively assumes in writing the obligations established hereunder for the HOME Units for whatever time remains of the Affordability Period. Failure of the transferee to assume the Developer's obligations under this Contract and the Loan Documents will result in termination of the Contract In addition, City may pursue any of its remedies under the Loan documents if the transferee fails to assume the Developer's obligations to maintain the Affordability Requirements throughout the Affordability Period. 6. CONSTRUCTION. 6.1. Construction Schedule. Developer will construct the Required Improvements in accordance with the schedule set forth in the attached Exhibit "C' — Construction and Reimbursement Schedule. Developer shall not begin construction until City sends a Notice to Proceed. Developer's failure to meet the Construction Schedule (as it may be modified in accordance with Section 14.19) shall be an event of default. Subject to Section 14.19, Developer may not change the Construction Schedule without the Director's prior written approval, which approval shall be in the Director's sole discretion 6.1.1 Construction Inspections. The construction of the project must pass a HED Department Minimal Acceptable Standard Inspection report, a HUD Compliance Inspection Report and any other applicable HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 10 HUD -required inspections during the construction period, along with any applicable final inspection approval from the City at the completion of the construction of the project. 6.2 Applicable Laws, Building Codes and Ordinances. All plans, specifications and construction for the Required Improvements shall (i) conform to all applicable Federal, state, City and other local laws, ordinances codes, rules and regulations, including the HOME Regulations; (ii) meet all City building codes, (iii) meet the Energy Conservation requirements as required by the State of Texas in Chapter 11 of the International Residential Code; (iv) if new construction, must conform to the Model Energy Code published by the Council of American Building Officials; and (v) must pass a HUD Compliance Inspection Report and inspection by City's HED Department inspectors. 6.3 Property Standards During Construction Developer shall comply with the following as applicable during the construction of the Required Improvements: (i) the Property Standards and Housing Quality Standards (HQS) contained in 24 CFR Part 92.251, (ii) Accessibility Standards under 24 CFR Part 92 251(a)(2)(i) (iii) any City property standards, and (iv) all other accessibility standards for the project. 6.4 Lead -Based Paint Requirements. Developer will comply with any applicable Federal lead -based paint requirements including lead screening in buildings built prior to 1978 in accordance with 24 CFR Part 92.355 and 24 CFR Part 35, subparts A, B, J, K, M, and R, and the Lead: Renovation, Repair and Painting Program Final Rule, 40 CFR Part 745, in the construction and/or rehabilitation of the Required Improvements. 6.5 Approval of Plans and Specifications by City Not Release of Responsibility. Approval of the Plans by City shall not constitute or be deemed (i) to be a release of the responsibility or liability of Developer or any of its contractors or subcontractors, or their respective officers, agents, employees and lower tier subcontractors, for the accuracy or the competency of the Plans, including, but not limited to, any related investigations, surveys, designs, working drawings and specifications or other documents; or (ii) an assumption of any responsibility or liability by City for any negligent act, error or omission in the conduct or preparation of any investigation, surveys, designs, working drawings and specifications or other documents by Developer or any of its contractors or subcontractors, and their respective officers, agents, employees and lower tier subcontractors. 6 6 Contractor, Subcontractor and Vendor Requirements. Developer will use commercially reasonable efforts to ensure that all contractors or vendors utilized by Developer or subcontractors utilized by Developer's general contractor are appropriately licensed and such licenses are maintained throughout the construction of the Required Improvements and the operation of the project when applicable. Developer shall ensure that all contractors utilized by Developer or subcontractors utilized by Developer's general contractor in the construction of the Required Improvements or vendors utilized by Developer in the operation of the project are not debarred or suspended from performing the contractor's, subcontractor's or vendor's work by the City, the State of Texas, or the Federal government Developer must confirm that all contractors, subcontractors or vendors are not HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 11 listed on the Federal System for Award Management, www.sam.gov, and must submit printed verification of such searches (i) with the first Reimbursement Request which include invoices from any contractor or subcontractor, or (ii) prior to hiring any vendor during the operation of the project during the Affordability Period. Failure to submit such proof of search shall be an event of default. In the event that City determines that any contractor, subcontractor or vendor has been debarred, suspended, or is not properly licensed, Developer or Developer's general contractor shall immediately cause the contractor, subcontractor or vendor to stop work on the project. In the event that any contractor, vendor or subcontractor has been debarred, suspended, or is not properly licensed, Developer shall not be reimbursed for any work performed by such contractor, vendor or subcontractor. However, this Section should not be construed to be an assumption of any responsibility or liability by City for the determination of the legitimacy, quality, ability, or good standing of any contractor, subcontractor or vendor. Developer acknowledges that the provisions of this Section pertaining to the Federal System for Award Management shall survive the termination of this Contract and be applicable for the length of the Affordability Period. 6.7. Furnish Complete Set of "As Built" Plans. Developer shall furnish City a complete set of "as built" or marked -up plans for the project at completion of construction after all final approvals have been obtained. 7. TENANT AND LEASE REOUIRMENTS: PROPERTY STANDARDS DURING AFFORDABILITY PERIOD 7.1 Income Eligibility. Developer must use the definition of annual income used by 24 CFR 5.609 to establish tenant income eligibility. Developer shall use the most current HUD Income Guidelines. Developer shall maintain Tenant Documentation sufficient to show that the HOME Units are occupied by HOME Eligible Households. 7.2 Income Verification. 7.2.1 Developer must verify that all tenants of HOME Units are HOME Eligible Households with full Tenant Documentation at the time the initial lease for a HOME Unit is executed. Tenants must certify the number of people in tenant's household along with such person's names and ages. Developer shall obtain financial information on all members of a tenant's household. 7.2.2 Developer must verify the income of the tenants of the HOME Units annually after the initial lease is executed, but may use a City -approved tenant self -certification form as Tenant Documentation. Notwithstanding the foregoing, Developer must verify the income eligibility of all HOME Eligible Households with full Tenant Documentation every 6th year of the Affordability Period. 7.2.3 Developer must maintain copies of Tenant Documentation as required under this Contract. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 12 7.2.4 As part of its monitoring, City will review Tenant Documentation during the Affordability Period. 7.3 Tenant Lease. 7.3.1 Developer shall submit to City the foiin of its tenant lease prior to leasing any HOME Unit. Such lease shall comply with the provisions of 24 CFR Part 92.253 regarding the following issues: 7.3.1.1 Length of lease term shall not exceed 2 years and may not be shorter than 1 year. 7.3.1.2 Lease may not include agreement by tenant to allow landlord to take, hold or sell tenant's property without notice. 7.3.1.3 Lease may not include agreement by the tenant to excuse owner from responsibility for intentional or negligent acts. 7.3.1.4 Lease may not authorize landlord to institute a lawsuit without notice to the tenant 7.3.1.5 Lease may not include agreement by tenant to waive a jury trial or right of appeal. 7.3.1.6 Lease may not include an agreement by tenant to pay legal costs of court proceeding even if the tenant prevails in those proceedings regardless of outcome. 7.3.2 Developer shall provide City copies of revised lease forms within 30 days of any change to its lease form. All changes to Developer's lease form shall comply with the requirement of Section 7.3.1. 7.4 Tenant Household Characteristics. 7.4.1 Developer shall provide City with the information about the household characteristics of the first tenant renting a HOME Unit on Exhibit "G" - Project Compliance Report: Rental Housing. 7.4.2 At City's request, Developer shall provide demographic information on all tenants in the project in order to show compliance with Section 7 7 during the Affordability Period. 7.5 Tenant Rent. Rents charged to tenants of the HOME Units are subject to 24 CFR 92.252 (a) and (b) and are subject to review and approval by City at initial lease up and prior to any rent increases Under no circumstances may the maximum rent charged to tenants of HOME Units exceed the High Home Rent minus utility allowances (excluding telephone). Developer agrees to abide by HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 13 HUD -approved schedules of HOME rent levels and the locally adopted utility allowances published annually by the Fort Worth Housing Authority. 7.6 Tenant Selection Within 90 days of the Effective Date, Developer must submit to City for City's approval Developer's tenant selection policy and criteria that address the following: 7.6.1 The tenant selection policy must be consistent with the purpose of providing housing for very low and low income persons. 7.6.2 The tenant selection policy must provide for: 7.6.2.1 Selection of tenants from a written waiting list in the chronological order of their application, insofar as is practicable; 7.6.2.2 Prompt written notification to any rejected applicant of the grounds for such rejection; and 7.6.2.3 Bi-lingual leasing and management assistance. 7.6.3 Holders of rental assistance subsidies (such as HUD's Housing Choice Voucher or similar subsidy) must not be excluded from renting a unit in the project. 7.6.4 The tenant selection policy must address non-discrimination and affirmative marketing as discussed in Section 7.7. 7.6.5 Developer must market Accessible Units in the following order: 7.6.5.1 Within the project to persons requiring an accessible unit. 7.6.5.2 To persons on the waiting list requiring an accessible unit. 7.6.5.3 To the general community for persons requiring accessible unit. 7.6.5.4 To persons that do not require an accessible unit. 7.6.6 The tenant selection policy must address the lease requirements described in Section 7 3 7.6.7 The tenant selection policy must address managing HOME Unit requirements. 7.6.8 The tenant selection policy must comply with state and local tenant/landlord laws. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 14 7.7 Affirmative Marketing. Developer must adopt and implement affirmative marketing procedures as required by 24 CFR 92.351 if the project involves the construction of 5 or more HOME Units. The procedures and requirements must include methods for informing the public, owners and potential tenants about fair housing laws and policies so as to ensure that all individuals are given an equal opportunity to participate in the project without regard to sex, age, race, color, creed, nationality, national origin religion, handicap status, disability, familial status, sexual orientation, gender identity, gender expression or transgender. The procedures and requirements must designate an individual who will be responsible for marketing the project and must establish a clear application screening plan. They must also provide for the maintenance of documentation and records to evidence that affilinative marketing procedures have been implemented. Developer's affirmative marketing procedures must be submitted to City for approval prior to implementation; provided however, City shall have no responsibility for affirmative marketing of the project. 7.8 Property Inspections During Initial Lease -Up of HOME Units. City shall inspect all units in the project before they are placed into service. City shall inspect the HOME Units prior to a HOME Eligible Household occupying such unit to ensure that each HOME Unit meets the appropriate HOME standards. Thereafter, City will inspect the HOME Units annually. 7.9 Property Maintenance and Inspections During Affordability Period. Developer shall ensure that the project is maintained in accordance with all applicable HUD property standards for the duration of the Affordability Period, which at a minimum shall be those property standards required in 24 CFR Part 92. City will verify maintenance of the project to these standards through on -site inspections every year. 8. ADDITIONAL HOME REQUIREMENTS. Developer agrees to comply with all requirements of the HOME Program as stated in the HOME Regulations, including, but not limited to the following: 8.1 Environmental Review. HOME Funds will not be paid and costs cannot be incurred until City has conducted and completed an environmental review as required by 24 CFR Part 58. The environmental review may result in a decision to proceed with, modify, or cancel the project. Further, Developer will not undertake or commit any funds to physical or choice limiting actions, including if applicable, property acquisition, demolition, movement, rehabilitation, conversion, repair or construction prior to the environmental clearance. Any violation of this Section will (i) cause this Contract to terminate immediately; (ii) require Developer to repay any HOME Funds received to City and forfeit any future payments of HOME Funds; and (iii) Developer must pay 10% of the HOME Funds to City as liquidated damages. The Parties agree that City's actual damages in the event of Developer violating this Section are uncertain and would be difficult to ascertain and may include a finding by HUD, a repayment of funds to HUD by City or otherwise impact the City's HOME grant or other federal grant funds. Therefore, the Parties agree that payment under this HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 15 Section of 10% of the Loan amount by Developer to City is liquidated damages and not a penalty. 8.1.2 Mitigation. Developer must take the mitigation actions outlined in Exhibit "A-2" — Environmental Mitigation Actions. Failure to complete the required mitigation action is an event of default under this Contract. 8.2 Intentionally Omitted. 8.3. Monitoring. 8.3.1 Developer understands and agrees that during the Affordability Period and for 5 years after the Affordability Period terminates, it will be subject to monitoring by City for compliance with the HOME Regulations during the Affordability Period. Developer will provide reports and access to project files as requested by City during the Affordability Period and for 5 years after it ends. 8.3.2 Representatives of City, HUD and the United States Comptroller General shall have access during regular business hours upon at least 48 hours prior notice to Developer's offices and records that are related to the use of the HOME Funds that are the basis of this Contract, and to its officers directors, agents, employees, contractors, subcontractors and vendors for the purpose of such monitoring 8.3.3 In addition to other provisions of this Contract regarding frequency of monitoring, City reserves the right to perform desk reviews or on -site monitoring of Developer's compliance with the terms and conditions of this Contract and the Loan. After each monitoring visit, City shall provide Developer with a written report of the monitor's findings. If the monitoring report notes deficiencies in Developer's performance the report shall include requirements for the timely correction of said deficiencies by Developer. Failure by Developer to take the action specified in the monitoring report may be cause for suspension or termination of this Contract as provided herein or City may take all actions allowed in the Loan Documents. 8.3.4 This Section 8.3 shall survive the earlier termination or expiration of this Contract and be applicable for the duration of the Affordability Period and for 5 years thereafter. . 8.4 Compliance with the Uniform Relocation Act. If applicable, Developer shall comply with the relocation requirements of 24 CFR Part 92.353 and all other applicable Federal and state laws and City ordinances and requirements pertaining to relocation 8.5 Compliance with Davis -Bacon. If applicable, Developer and its general contractor and all lower tier subcontractors will comply with the Davis -Bacon Act as described in Section 14.14 and Exhibit "H" — Davis - Bacon Requirements — Federal Labor Standards Provisions. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 16 8.6 Developer Procurement Standards. Developer shall ensure that procurement of materials and services is done in a cost effective manner. Developer shall comply with all applicable federal, state and local laws, regulations, and ordinances for making procurements under this Contract. 8.7 Copyright and Patent Rights. No reports, maps, or other documents produced in whole or in part under this Contract shall be the subject of an application for copyright by or on behalf of Developer. HUD and City shall possess all rights to invention or discovery, as well as rights in data which may arise as a result of Developer's performance under this Contract. 8.8 Terms Applicable to Contractors. Subcontractors and Vendors. Developer understands and agrees that all terms of this Contract, whether regulatory or otherwise, shall apply to any and all contractors, subcontractors and vendors of Developer which are in any way paid with HOME Funds or who perform any work in connection with the project. Developer shall cause all applicable provisions of this Contract to be included in and made a part of any contract or subcontract executed in the performance of its obligations hereunder, including its obligations regarding the Affordability Requirements and the HOME Regulations during the Affordability Period. Developer shall monitor the services and work performed by its contractors, subcontractors and vendors on a regular basis for compliance with the Affordability Requirements, the HOME Regulations and Contract provisions. Developer is responsible to cure all violations of the HOME Regulations committed by its contractors subcontractors or vendors. City maintains the right to insist on Developer's full compliance with the terms of this Contract and the HOME Regulations and Developer is responsible for such compliance regardless of whether actions to fulfill the requirements of this Contract or the HOME Regulations are taken by Developer or by Developer's contractors, subcontractors or vendors. Developer acknowledges that the provisions of this Section shall survive the earlier termination or expiration of this Contract and be applicable for the length of the Affordability Period. 8.9 Payment and Performance Bonds. Subject to the requirements of 24 CFR Part 85.36 Developer shall furnish City with payment and performance bonds in a form acceptable to City in the amount of the construction cost for the Development but not less than $240,000.00. 9. RECORD KEEPING. REPORTING AND DOCUMENTATION REOUIREMENTS RIGHT TO AUDIT. 9.1 Record Keeping Developer shall maintain a record -keeping system as part of its performance of this Contract and shall promptly provide City with copies of any document City deems necessary for the effective fulfillment of City s monitoring and evaluation responsibilities. Specifically, Developer will keep or cause to be kept an accurate record of all actions taken and all funds spent, with supporting and back-up documentation as well as all Tenant Documentation. Developer will maintain all records and documentation related to this Contract for 5 years after the end of the Affordability Period. If any claim litigation, or audit is initiated before the expiration of the 5 year period, the relevant records and documentation must be retained until all such claims, litigation or audits have been resolved. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 17 9.1.2 Access to Records. City representatives and HUD or other federal agency representatives will have full access to, and the right to examine, audit, excerpt and/or transcribe any of Developer's records pertaining to all matters covered by this Contract throughout the Affordability Period and for 5 years thereafter. Such access shall be during regular business hours upon 48 hours prior notice. 9.2 Reports. Developer will submit to City all reports and documentation described in this Contract in such form as City may prescribe. Developer may also be required to submit a final performance and/or final financial report if required by City at the termination of this Contract and/or the termination of the Loan in such form and within such times as City may prescribe. Failure to submit any report or documentation described in this Contract to City shall be an event of default of this Contract and City may exercise all of it remedies for default under this Contract and Loan Documents. 9.3 Change in Reporting Requirements and Forms. City retains the right to change reporting requirements and forms at its discretion. City will notify Developer in writing at least 30 days prior to the effective date of such change, and the Parties shall execute an amendment to the Contract reflecting such change if necessary. 9.4 City Reserves the Right to Audit. City reserves the right to perform an audit of Developer's project operations and finances at any time during the term of this Contract or the Affordability Period and for 5 years thereafter, if City determines that such audit is necessary for City's compliance with the HOME Regulations or other City policies, and Developer agrees to allow access to all pertinent materials as described herein. If such audit reveals a questioned practice or expenditure, such questions must be resolved within 15 business days after notice to Developer of such questioned practice or expenditure. If questions are not resolved within this period, City reserves the right to withhold further funding under this and/or future contract(s) with Developer. IF AS A RESULT OF ANY AUDIT IT IS DETERMINED THAT DEVELOPER HAS FALSIFIED ANY DOCUMENTATION OR MISUSED, MISAPPLIED OR MISAPPROPRIATED HOME FUNDS OR SPENT HOME FUNDS ON ANY INELIGIBLE ACTIVITIES, DEVELOPER AGREES TO REIMBURSE CITY THE AMOUNT OF SUCH MONIES PLUS THE AMOUNT OF ANY SANCTIONS, PENALTY OR OTHER CHARGE LEVIED AGAINST CITY BY HUD BECAUSE OF SUCH ACTIONS. 10. REIMBURSEMENT REQUIREMENTS. Developer shall provide City with Complete Documentation as applicable and the following reports as shown in Exhibit "F" - Reimbursement Forms with each Reimbursement Request: HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 18 10.1 Attachment I — Invoice. This report shall contain the amount requested for reimbursement in the submitted request, and the cumulative reimbursement requested to date (inclusive of the current request). This report must be signed by an authorized signatory of Developer. By signing Attachment I, Developer is certifying that the costs are valid, eligible, and consistent with the terms and conditions of this Contract, and the data contained in the report is true and correct. 10.2 Attachment II — Expenditure Worksheet. This report shall itemize each expense requested for reimbursement by Developer. In order for this report to be complete the following must be submitted: 10.2.1 Invoices for each expense with an explanation as to how the expense pertains to the project, if necessary; and 10.2.2 Proof that each expense was paid by Developer, which proof can be satisfied by cancelled checks, wire transfer documentation, paid receipts or other appropriate banking documentation. 10 3. Deadline for Submitting Reimbursement Requests. All Reimbursement Requests along with Complete Documentation shall be submitted by Developer to City within 60 days from each of the deadlines as shown in Exhibit "C" — Construction and Reimbursement Schedule. 10.4 Withholding Payment. CITY SHALL HAVE NO OBLIGATION TO MAKE PAYMENT ON ANY REIMBURSEMENT REQUEST THAT IS NOT RECEIVED WITHIN 60 DAYS OF THE DEADLINES SHOWN IN Exhibit "C" — Construction and Reimbursement Schedule. In addition, Developer's failure to timely submit Reimbursement Requests and Complete Documentation along with any required reports shall be an event of default. 11. DEFAULT AND TERMINATION. 11.1 Failure to Begin or Complete the Required Improvements 11.1.1 If Developer fails to begin construction, which for purposes of this Contract shall mean pouring foundations on the Required Improvements, within 12 months of the execution of this Contract, this Contract shall automatically terminate without further warning or opportunity to cure, and with no penalty or liability to City. 11.1.2 If City determines that the Required Improvements were not completed by the Completion Deadline (as may be modified in accordance with Section 14.19) or have failed to pass any of the inspections described in Section 6 1 1, City shall have the right to terminate this Contract with no penalty or liability to City, with such termination to be effective immediately upon written notice. City shall also be entitled to demand repayment of the HOME Funds and enforce any of the provisions of Loan documents for default. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 19 11.2 Failure to Submit Complete Documentation During Construction. 11.2.1 If Developer fails to submit all applicable Complete Documentation during construction of the Required Improvements in accordance with Exhibit "C" - Construction and Reimbursement Schedule, or if any report or documentation submitted as part of Complete Documentation is not in compliance with this Contract or the HOME Regulations as determined by City, City will notify Developer in writing and the Developer will have 15 calendar days from the date of the written notice to submit or resubmit any such report or documentation. If Developer fails to submit or resubmit any such report or documentation within such time, City shall have the right to withhold payments If such failure continues for an additional 15 days (a total of 30 days) City shall have the right to terminate this Contract effective immediately upon written notice of such intent with no penalty or liability to City. Notwithstanding anything to the contrary herein, City will not be required to pay any HOME Funds to Developer during the period that any such report or documentation is not in compliance with this Contract or the HOME Regulations. 11.2.2 If any of Developer's Reimbursement Requests are incomplete or otherwise not in compliance with this Contract or the HOME Regulations as determined by City, City will notify Developer in writing of such default and the Developer will have 15 calendar days from the date of the written notice to resubmit any such Reimbursement Request to cure the default. If the Developer fails to cure the default within such time, Developer shall forfeit any payments otherwise due under such Reimbursement Request If such failure to resubmit such Reimbursement Request continues for an additional 15 days (a total of 30 days) the City shall have the right to terminate this Contract effective immediately upon written notice of such intent with no penalty or liability to City. Notwithstanding anything to the contrary herein, City will not be required to pay any HOME Funds to Developer during the period that any such Reimbursement Request is not in compliance with this Contract or the HOME Regulations. 11.2.3 In the event of more than 2 instances of default, cured or uncured, under Sections 11.2.1 or 11.2.2, City reserves the right at its sole option to terminate this Contract effective immediately upon written notice of such intent with no penalty or liability to City. 11.2.4 Notwithstanding anything to the contrary herein, City will not be required to pay any HOME Funds to Developer during the period that any Reimbursement Requests, reports or documentation are past due or are not in compliance with this Contract or the HOME Regulations, or during any period during which Developer is in default of this Contract. 11.2.5 In the event of termination under this Section 11.2, all HOME Funds awarded but unpaid to Developer pursuant to this Contract shall be immediately forfeited and Developer shall have no further right to such funds. Any HOME Funds already paid to Developer must be repaid to City within 30 days of termination under this Section. Failure to repay such HOME Funds will result in City exercising all legal remedies available to City under this Contract and the Loan Documents. For clarification, the defaults and related remedies set out in this Section 11.2 are not intended to arise from mathematical errors or other minor defects in a Reimbursement Request. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 20 11.3 Failure to Submit Required Reports and Documentation During Affordability Period. If Developer fails to maintain all records and documentation as required in Section 9, or fails to submit any report or documentation required by this Contract after the Required Improvements are completed, or if the submitted report or documentation is not in compliance with this Contract or the HOME Regulations as determined by City, City will notify Developer in writing and the Developer will have 30 calendar days from the date of the written notice to obtain or recreate the missing records or documentation, or submit or resubmit any such report or documentation to City. If Developer fails to maintain the required reports or documentation, or submit or resubmit any such report or documentation within such time, City shall have the right to terminate this Contract effective immediately upon written notice of such intent with no penalty or liability to City In the event of termination under this Section 11.3, any HOME Funds paid to Developer must be repaid to City within 30 days of termination Failure to repay such HOME Funds will result in City exercising all legal remedies available to City under this Contract and the Loan Documents. 11.4 In General. 11.4.1 Subject to Sections 11.1, 11.2 and 11.3, and unless specifically provided otherwise in this Contract, Developer shall be in default under this Contract if Developer breaches any term or condition of this Contract. In the event that such a breach remains uncured after 30 calendar days following written notice by City (or such other notice period as may be specified herein), or if Developer has diligently and continuously attempted to cure following receipt of such written notice but reasonably required more than 30 calendar days to cure as determined by both Parties mutually and in good faith, City shall have the right to elect, in City's sole discretion, to (i) extend Developer's time to cure, (ii) terminate this Contract effective immediately upon written notice of such intent to Developer, or (iii) pursue any other legal remedies available to City. 11 4.2 In the event of termination under this Section 11 4, all HOME Funds awarded but unpaid to Developer pursuant to this Contract shall be immediately rescinded and Developer shall have no further right to such funds and any HOME Funds already paid to Developer must be repaid to City within 30 days of termination Failure to repay such HOME Funds will result in City exercising all legal remedies available to City under this Contract or the Loan Documents 11.5 No Funds Disbursed while in Breach. Developer understands and agrees that no HOME Funds will be paid to Developer until all defaults are cured to the satisfaction of City. 11.6 No Compensation After Date of Termination. In the event of termination, Developer shall not receive any HOME Funds in compensation for work undertaken after the date of termination. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 21 11.7 Rights of City Not Affected. Termination shall not affect or terminate any of the existing rights of City against Developer, or which may thereafter accrue because of such default, and this provision shall be in addition to any and all other rights and remedies available to City under the law and Loan Documents including, but not limited to, compelling Developer to complete the Required Improvements in accordance with the terms of the Contract Such termination does not terminate any applicable provisions of this Contract that have been expressly noted as surviving the tem ! or termination of this Contract. 11.8 Waiver of Breach Not Waiver of Subsequent Breach. The waiver of a breach of any term, covenant, or condition of this Contract shall not operate as a waiver of any subsequent breach of the same or any other term, covenant or condition hereof. 11.9 Civil, Criminal and Administrative Penalties. Failure to perform all the Contract terms may result in civil, criminal or administrative penalties, including, but not limited to those set out in this Contract. 11.10 Termination for Cause. 11.10.1 City may tetiuinate this Contract in the event of Developer's default, inability, or failure to perform subject to notice, grace and cure periods. In the event City terminates this Contract for cause, all HOME Funds awarded but unpaid to Developer pursuant to this Contract shall be immediately rescinded and Developer shall have no further right to such funds and any HOME Funds already paid to Developer must be repaid to City within 30 days of termination. Failure to repay such HOME Funds will result in City exercising all legal remedies available to City under this Contract or the Loan Documents. DEVELOPER ACKNOWLEDGES AND AGREES THAT IF CITY TERMINATES THIS CONTRACT FOR CAUSE, DEVELOPER OR ANY AFFILIATES OF DEVELOPER SHALL NOT BE CONSIDERED FOR ANY OTHER CITY CONTRACT FOR HOME FUNDS FOR A MINIMUM OF 5 YEARS FROM THE DATE OF TERMINATION. In such event, and upon full repayment of any HOME funds previously advanced, the termination of the Contract shall have the effect of returning the Parties to their respective circumstances as existed prior to the execution of this Contract, and no terms or obligations shall survive the date of termination, including, but not limited to, reporting, inspections or the Affordability Period. 11.10.2 Developer may terminate this Contract if City does not provide the HOME Funds substantially in accordance with this Contract. In such event, the termination of the Contract shall have the effect of returning the Parties to their respective circumstances as existed prior to the execution of this Contract, and no tetras or obligations shall survive the date of termination, including, but not limited to, reporting, inspections or the Affordability Period. 11.11 Termination for Convenience. In terminating in accordance with 24 C.F.R. 85.44, this Contract may be terminated in whole or in part only as follows: HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 22 11.11.1 By City with the consent of Developer in which case the Parties shall agree upon the termination conditions, including the effective date and in the case of partial termination, the portion to be terminated, or 11.11.2 By Developer upon written notification to City setting forth the reasons for such termination, the effective date, and in the case of partial termination, the portion to be terminated. In the case of a partial termination, if City determines that the remaining portion of the Contract to be performed or HOME Funds to be spent will not accomplish the purposes for which the Contract was made, City may terminate the Contract in its entirety. 11.11.13 In the event of termination of the entire Contract under this Section 11.11, the termination shall have the effect of returning the Parties to their respective circumstances as existed prior to the execution of this Contract, and no terms or obligations shall survive the date of termination, including, but not limited to, reporting, inspections or the Affordability Period. 11.12 Dissolution of Developer Terminates Contract. In the event Developer is dissolved or ceases to exist, this Contract shall terminate. In the event of termination under this Section, all HOME Funds are subject to repayment and/or City may exercise all of its remedies under this Contract and the Loan Documents 11 13 Notice of Termination under Subordination Agreement. City shall not terminate this Contract without first giving notice and opportunity to cure to the Senior Lender as required in the Subordination Agreement 12. REPAYMENT OF HOME FUNDS. All HOME Funds are subject to repayment in the event the project does not meet the requirements as set out in this Contract or in the HOME Regulations. If Developer takes any action that results in City being required to repay all or any portion of the HOME Funds to HUD, Developer agrees it will reimburse City for such repayment. If Developer takes any action that results in City receiving a finding from HUD about the project, whether or not repayment to HUD is required of City, Developer agrees it will pay City 10% of the HOME Funds as liquidated damages. The Parties agree that City's damages in the event of either repayment to HUD being required or receiving a finding from HUD are uncertain and would be difficult to ascertain and may include an impact on City's HOME grant or other federal grant funds, in addition to a finding by HUD or a repayment of funds to HUD by City. Therefore, the Parties agree that payment under this Section of 10% of the Loan amount by Developer to City is liquidated damages and not a penalty. 13. MATERIAL OWNERSHIP CHANGE. Subject to Investor Member transfers in accordance with Developer s Operating Agreement or otherwise with City consent, and subject to the terms of the Deed of Trust, if ownership of the Developer materially changes after the date of this Contract, City may but is not obligated to, terminate this Contract. City has 30 days to make such determination after receipt of notice from Developer and failure to make such determination in that time period will HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 23 constitute a waiver. In the event of termination under this Section 13, all HOME Funds awarded but not yet paid to Developer pursuant to this Contract shall be immediately rescinded and Developer shall have no further right to such funds. Any HOME Funds already paid to Developer must be repaid to City within 30 days of termination under this Section In such event, and upon full repayment of any HOME funds previously advanced, the termination of the Contract shall have the effect of returning the Parties to their respective circumstances as existed prior to the execution of this Contract, and no terms or obligations shall survive the date of termination, including, but not limited to, reporting, inspections or the Affordability Period. 14. GENERAL PROVISIONS 14.1 Developer an Independent Contractor. Developer shall operate hereunder as an independent contractor and not as an officer, agent, servant or employee of City. Developer shall have exclusive control of, and the exclusive right to control, the details of the work and services performed hereunder, and all persons performing same, and shall be solely responsible for the acts and omissions of its officers, members, agents, servants, employees, contractors, subcontractors, vendors, tenants, licensees or invitees. 14.2 Doctrine of Respondeat Superior. The doctrine of respondeat superior shall not apply as between City and Developer, its officers, members, agents, servants, employees contractors, subcontractors, vendors, tenants, licensees or invitees, and nothing herein shall be construed as creating a partnership or joint enterprise between City and Developer. City does not have the legal right to control the details of the tasks performed hereunder by Developer, its officers, members, agents, employees, contractors, subcontractors, vendors, licensees or invitees 14.3 Developer Property. City shall under no circumstances be responsible for any property belonging to Developer, its officers, members, agents, employees, contractors, subcontractors, vendors, tenants licensees or invitees that may be lost, stolen or destroyed or in any way damaged and DEVELOPER HEREBY INDEMNIFIES AND HOLDS HARMLESS CITY AND ITS OFFICERS, AGENTS, AND EMPLOYEES FROM ANY AND ALL CLAIMS OR SUITS PERTAINING TO OR CONNECTED WITH SUCH PROPERTY. 14.4 Religious Organization. No portion of the HOME Funds shall be used in support of any sectarian or religious activity In addition, there must be no religious or membership criteria for tenants of a HOME - funded property. 14.5 Venue. Venue for any action, whether real or asserted at law or in equity, arising out of the execution, performance, attempted performance or non-performance of this Contract, shall he in Tarrant County, Texas. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 24 14.6 Governing Law. This Contract shall be governed by and construed in accordance with the laws of the State of Texas If any action, whether real or asserted, at law or in equity, arises out of the execution, performance or non-perfoiluance of this Contract or on the basis of any provision herein, for any issue not governed by Federal law, the choice of law shall be the laws of the State of Texas. 14.7 Severability. The provisions of this Contract are severable, and if for any reason a clause, sentence, paragraph or other part of this Contract shall be determined to be invalid by a court or Federal or state agency, board or commission having jurisdiction over the subject matter thereof, such invalidity shall not affect other provisions which can be given effect without the invalid provision. 14.8 Written Agreement Entire Agreement. This written instrument and the Exhibits, Addendums and Attachments attached hereto, which are incorporated by reference and made a part of this Contract for all purposes, constitute the entire agreement by the Parties hereto concerning the work and services to be performed under this Contract. Any prior or contemporaneous oral or written agreement which purports to vary the terms of this Contract shall be void. Any amendments to the terms of this Contract must be in writing and must be executed by the Parties. 14.9 Paragraph Headings for Reference Only, No Legal Significance: Number. The paragraph headings contained herein are for convenience in reference to this Contract and are not intended to define or to limit the scope of any provision of this Contract. When context requires, singular nouns and pronouns include the plural and the masculine gender shall be deemed to include the feminine or neuter and the neuter gender to include the masculine and feminine. The words "include" and "including" whenever used herein shall be deemed to be followed by the words "without limitation".. 14.10 Compliance With All Applicable Laws and Regulations. Developer agrees to comply fully with all applicable laws and regulations that are currently in effect or that are hereafter amended during the performance of this Contract. These laws include, but are not limited to: ➢ HOME Investment Partnerships Act as set out above ➢ Title VI of the Civil Rights Act of 1964 (42 U.S.C. Sections 2000d et seq.) including provisions requiring recipients of federal assistance to ensure meaningful access by person of limited English proficiency ➢ The Fair Housing Act, Title VIII of the Civil Rights Act of 1968 (42 U.S.C. Sections 3601 et seq.) ➢ Executive Orders 11063, 11246 as amended by 11375 and 12086 and as supplemented by Department of Labor regulations 41 CFR, Part 60 ➢ The Age Discrimination in Employment of 1967 ➢ The Age Discrimination Act of 1975 (42 U.S.C. Sections 6101 et seq.) ➢ The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (42 U.S.C. Sections 4601 et seq. and 49 CFR Part 24) (` URA") HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 25 ➢ Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. Sections 794 et seq.) and 24 CFR Part 8 where applicable ➢ National Environmental Policy Act of 1969, as amended, 42 U.S.C. sections 4321 et seq. ("NEPA") and the related authorities listed in 24 CFR Part 58. ➢ The Clean Air Act, as amended, (42 U.S.C. Sections 1251 et seq.) and the Clean Water Act of 1977, as amended (33 U.S.C. Sections 1251 et seq.), related Executive Order 11738 and Environmental Protection Agency Regulations at 40 CFR Part 15. In no event shall any amount of the assistance provided under this Contract be utilized with respect to a facility that has given rise to a conviction under the Clean Air Act or the Clean Water Act. ➢ Immigration Reform and Control Act of 1986 (8 U.S.C. Sections 1101 et seq.) specifically including the provisions requiring employer verifications of legal status of its employees ➢ The Americans with Disabilities Act of 1990 (42 U S.C. Sections 12101 et seq.), the Architectural Barriers Act of 1968 as amended (42 U S.C. sections 4151 et seq.) and the Unifoim Federal Accessibility Standards, 24 CFR Part 40, Appendix A ➢ Regulations at 24 CFR Part 87 related to lobbying, including the requirement that certifications and disclosures be obtained from all covered persons ➢ Drug Free Workplace Act of 1988 (41 U.S.C. Sections 701 et seq.) and 24 CFR Part 23, Subpart F ➢ Executive Order 12549 and 24 CFR Part 5.105(c) pertaining to restrictions on participation by ineligible, debarred or suspended persons or entities ➢ Regulations at 24 CFR Part 882.708(c) pertaining to site and neighborhood standards for new construction projects ➢ Regulations at 24 CFR Part 983.6 for Site and Neighborhood Standards Review ➢ Section 6002 of the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act ➢ Guidelines of the Environmental Protection Agency at 40 CFR Part 247 ➢ For contracts and subgrants for construction or repair, Copeland "Anti -Kickback" Act (18 U.S.C. 874) as supplemented in 29 CFR Part 5 ➢ For construction contracts in excess of $2,000, and in excess of $2,500 for other contracts which involve the employment of mechanics or laborers, Sections 103 and 107 of the Contract Work Hours and Safety Standards Act (40 U.S.C. 327A 300) as supplemented by 29 CFR Part 5 ➢ Lead -Based Paint Poisoning Prevention Act (42 U.S.C. 4801 et seq), as amended by the Residential Lead -Based Paint Hazard Reduction Act of 1992 (42 U.S.C. 4851 et seq.) and implementing regulations at 24 CFR Part 35, subparts A, B, M, and R ➢ Regulations at 24 CFR Part 92, Home Investment Partnerships Program Final Rule 14.11 HUD -Assisted Projects and Employment and other Economic Opportunities; Section 3 Requirements. 14.11.1 Requirement that Law Be Quoted in Covered Contracts. — Certain Requirements Pertainmg to Section 3 of the Housing and Urban Development Act of 1968 as Amended (12 U.S.C. Sections 1701 et seq.) and its Related Regulations at 24 CFR Part 135 HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 26 If the construction of the Required Improvements will cause the creation of new employment, training, or contracting opportunities on a contractor or subcontractor level resulting from the expenditure of the HOME Funds, Developer shall comply with the following and will ensure that its contractors also comply. If the work perfollned under this Contract is on a project assisted under a program providing direct Federal financial assistance from HUD, Section 3 of 24 CFR 135.38 ( `Section 3") requires that the following clause, shown in italics, be inserted in all covered contracts ("Section 3 Clause"): Section to be quoted in covered contracts begins: "A. The work to be performed under this contract is subject to the requirements of Section 3 of Housing and Urban Development Act of 1968, as amended, 12 U.S.C. section 1701u (Section 3). The purpose of Section 3 is to ensure that employment and other economic opportunities generated by HUD assisted or HUD -assisted projects covered by Section 3, shall to the greatest extent feasible, be directed to low- and very -low income persons, particularly persons who are recipients of HUD assistance for housing. B. The parties to this contract agree to comply with HUD's regulations in 24 CFR Part 135, which implement Section 3. As evidenced by their execution of this contract, the parties to this contract certify that they are under no contractual or other impediment that would prevent them from complying with the Part 135 regulations. C. The contractor agrees to send to each labor organization or representative of workers with which it has a collective bargaining agreement or other understanding, if any, a notice advising the labor organization or workers' representatives of the contractor's commitments under this Section 3 clause and will post copies of the notice in conspicuous places at the work site where both employees and applicants for training and employment positions can see the notice. The notice shall describe the Section 3 preference, shall set forth minimum number and job titles subject to hire, availability of apprentice and training positions, the qualifications for each; and the name and location of the person(s) taking applications for each of the positions; and the anticipated date the work shall begin. D. The contractor agrees that it will include this Section 3 clause in every subcontract to comply with regulation in 24 CFR Part 135, and agrees to take appropriate action, as provided in an applicable provision of the subcontract or in this Section 3 clause, upon finding that the subcontractor is in violation of the regulations in 24 CFR Part 135. The contractor will not subcontract with any subcontractor where it has notice or knowledge that the subcontractor has been found in violation of regulations in 24 CFR 135. E. The contractor will certify that any vacant employment positions, including training positions that are filed: (1) after the contractor is selected but before the contract is executed, and (2) with persons other than those to whom the regulations of 24 CFR Part 135. The contractor will not subcontract with any subcontractor where it has notice or knowledge that the subcontractor has been found in violation of regulations in 24 CFR 135. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 27 F. Noncompliance with HUD's regulation in 24 CFR Part 135 may result in sanctions, termination of this contract for default, and debarment or suspension from future HUD assisted contracts. G. With respect to work performed in connection with Section 3 covered Indian housing assistance, section 7(b) of the Indian Self -Determination and Education Assistance Act (25 U.S.C. section 450e) also applies to the work to be performed under this Contract. Section 7(b) requires that to the greatest extent feasible (i) preference and opportunities for training and employment shall be given to Indians, and (ii) preference in the award of contracts and subcontracts shall be given to Indian organizations and Indian -owned Economic Enterprises. Parties to this contract that are subject to the provisions of Section 3 and Section 79b) agree to comply with Section 3 to the maximum extent feasible, but not in derogation of compliance with Section 7(b). " Section to be quoted in covered contracts ends. 14.11.2 Developer Responsibilities for Section 3 Requirements. City and Developer understand and agree that compliance with the provisions of Section 3, the regulations set forth in 24 CFR Part 135, and all applicable rules and orders of HUD shall be a condition of the Federal financial assistance provided to the project binding upon City and Developer, and their respective successors, assigns, contractors and subcontractors. Failure to fulfill these requirements shall subject Developer and its contractors and subcontractors and their respective successors and assigns to those sanctions specified by the grant agreement through which Federal assistance is provided and to such sanctions as are specified by 24 CFR Part 135. Developer's responsibilities include: 14.11.2.1 Implementing procedures to notify Section 3 residents and business concerns about training, employment, and contracting opportunities generated by Section 3 covered assistance; 14.11.2.2 Notifying potential contractors working on Section 3 covered projects of their responsibilities; 14.11.2.3 Facilitating the training and employment of Section 3 residents and the award of contracts to Section 3 business concerns; 14.11.2.4 Assisting and actively cooperating with the HED Department in making contractors and subcontractors comply; 14.11.2.5 Refraining from entering into contracts with contractors that are in violation of Section 3 regulations; 14.11.2.6 Documenting actions taken to comply with Section 3; and HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 28 14.11.2.7 Submitting Section 3 Annual Summary Reports (form HUD- 60002) in accordance with 24 CFR Part 135.90. 14.11 3 Section 3 Reporting Requirements. In order to comply with the Section 3 requirements, Developer must submit the forms attached hereto as Exhibit "I" - Section 3 Reporting Forms. 14.11.3.1 Report to the City on a quarterly basis, all applicants for employment, and all applicants for employment by contractors and any subcontractors. This shall include name, address, zip code, date of application, and status (hired/not- hired) as of the date of the report. 14.11.3.2 Advertise available positions to the public for open competition and provide documentation to City with the quarterly report that demonstrates such open advertisement, in the form of printout of Texas Workforce Commission posting, copy of newspaper advertisement, copy of flyers and listing of locations where flyers were distributed, and the like. 14.11.3.3 Report to the City on a quarterly basis, all contracts awarded by contractors and any subcontractors. This shall include name of contractor and/or subcontractor, address, zip code, and amount of award as of the date of the report. 14.12 Prohibition Against Discrimination. 14.12.1 General Statement. Developer, in the execution, performance or attempted performance of this Contract, shall comply with all non-discrimination requirements of 24 CFR 92.350 and the ordinances codified at Chapter 17, Article III, Division 4 — Fair Housing of the City Code. Developer may not discriminate against any person because of race, color, sex, gender, religion, national origin, familial status, disability or perceived disability, sexual orientation, gender identity, gender expression, or transgender, nor will Developer permit its officers, members, agents, employees, or project participants to engage in such discrimination. This Contract is made and entered into with reference specifically to the ordinances codified at Chapter 17, Article III, Division 3 - Employment Practices of the City Code, and Developer hereby covenants and agrees that Developer, its officers, members, agents, employees and contractors, have fully complied with all provisions of same and that no employee, or applicant for employment has been discriminated against under the terms of such ordinances by either or its officers, members, agents, employees or contractors. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 29 14.12.2 No Discrimination in Employment durin! the Performance of this Contract. During the performance of this Contract Developer agrees to the following provision, and will require that its contractors and subcontractors also comply with such provision by including it in all contracts with its contractors: [Contractor's or Subcontractor's Name] will not unlawfully discriminate against any employee or applicants for employment because of race, color, sex, gender, religion, national origin, familial status disability or perceived disability, sexual orientation, gender identity, gender expression or transgender. (Contractor's or Subcontractor's Namel will take affirmative action to ensure that applicants are hired without regard to race, color, sex, gender, religion, national origin, familial status, disability or perceived disability, sexual orientation, gender identity, gender expression or transgender and that employees are treated fairly during employment without regard to their race, color, sex, gender, religion, national origin, familial status, disability or perceived disability, sexual orientation, gender identity, gender expression or transgender. Such action shall include, but not be limited to, the following: employment, upgrading, demotion or transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. (Contractor's or Subcontractor's Namel, agrees to post in conspicuous places, available to employees and applicants for employment, notices setting forth the provisions of this nondiscrimination clause. [Contractor's or Subcontractor's Name]will, in all solicitations or advertisements for employees placed by or on behalf of (Contractor's or Subcontractor's Name], , state that all qualified applicants will receive consideration for employment without regard to race, color, sex, gender, religion, national origin, familial status, disability or perceived disability, sexual orientation, gender identity, gender expression or transgender. [Contractor's or Subcontractor's Name], covenants that neither it nor any of its officers, members, agents, employees, or contractors, while engaged in performing this Contract, shall, in connection with the employment, advancement or discharge of employees or in connection with the terms, conditions or privileges of their employment, discriminate against persons because of their age or because of any disability or perceived disability, except on the basis of a bona fide occupational qualification, retirement plan or statutory requirement. (Contractor's or Subcontractor's Namel further covenants that neither it nor its officers, members, agents, employees, contractors, or persons acting on their behalf, shall specify, in solicitations or advertisements for employees to work on this Contract, a maximum age limit for such employment unless the specified maximum age limit is based upon a bona fide occupational qualification, retirement plan or statutory requirement HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 30 14.12.3 Developer s Contractors and ADA. In accordance with the provisions of the Americans With Disabilities Act of 1990 ("ADA"), Developer warrants that it will not unlawfully discriminate on the basis of disability in the provision of services to the general public, nor in the availability, terms and/or conditions of employment for applicants for employment with, or employees of Developer. DEVELOPER WARRANTS IT WILL FULLY COMPLY WITH ADA'S PROVISIONS AND ANY OTHER APPLICABLE FEDERAL, STATE AND LOCAL LAWS CONCERNING DISABILITY AND WILL DEFEND, INDEMNIFY AND HOLD CITY HARMLESS AGAINST ANY CLAIMS OR ALLEGATIONS ASSERTED BY THIRD PARTIES, CONTRACTORS OR SUBCONTRACTORS AGAINST CITY ARISING OUT OF DEVELOPER'S AND/OR ITS CONTRACTORS', SUBCONTRACTORS', AGENTS' OR EMPLOYEES' ALLEGED FAILURE TO COMPLY WITH THE ABOVE - REFERENCED LAWS CONCERNING DISABILITY DISCRIMINATION IN THE PERFORMANCE OF THIS CONTRACT. 14.13. Prohibition Against Interest / Conflict of Interest. 14.13.1 Developer shall establish safeguards to prohibit its employees, board members, advisors and agents from using positions for a purpose that is or gives the appearance of being motivated by a desire for private gain for themselves or others, particularly those with whom they have family, business or other ties. Developer shall disclose to City any conflict of interest or potential conflict of interest described above, immediately upon discovery of such 14.13.2 No persons who are employees, agents, consultants, officers or elected officials or appointed officials of City or of Developer who exercise or have exercised any functions or responsibilities with respect to activities assisted with HOME funds or who are in a position to participate in a decision -making process or gain inside information with regard to these activities may occupy a HOME Unit, may obtain a financial interest or benefit from a HOME -assisted activity, or have an interest in any contract, subcontract or agreement with respect thereto, or the proceeds thereunder, either for themselves or those with whom they have family or business ties during their tenure or for 1 year thereafter, unless they are accepted in accordance with the procedures set forth at 24 C.F.R. Part 92.356. 14.13.3 Developer affirms that it will adhere to the provisions of the Texas Penal Code which prohibits bribery and gifts to public servants. 14.13.4 If applicable, the conflict of interest provisions of 24 CFR Part 85.36 and 24 CFR Part 84.42 respectively, shall apply in the procurement of property and services by Developer. In all cases not governed by those sections, the provisions of 24 CFR Part 92.356 of the HOME Regulations shall apply. 14.14 Labor Standards. 14.14 1 As applicable, Developer agrees to comply with the requirements of the Secretary of Labor in accordance with the Davis -Bacon Act (40 U S.C. 276a-7) as amended, the provisions of Contract Work Hours and Safety Standards Act (40 U.S.C. 327 et seq.) and all HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 31 other applicable Federal, state and local laws and regulations pertaining to labor standards insofar as those acts apply to the performance of this Contract. Developer agrees to comply with the Copeland Anti -Kick Back Act (18 U.S.C. 874 et seq.) and its implementing regulations of the United States Department of Labor at 29 CFR Part 5. Developer shall maintain documentation that demonstrates compliance with hour and wage requirements of this Contract and HOME Regulations. Such documentation shall be made available promptly to City for review upon request. 14.14.2 Developer agrees that, except with respect to the rehabilitation or construction of residential property containing less than 12 units assisted with HOME funds, all contractors engaged under contract for construction, renovation or repair work financed in whole or in part with assistance provided under this Contract, shall comply with Federal requirements adopted by City pertaining to such contracts and with the applicable requirements of the regulations of the Department of Labor under 29 CFR Parts 1, 3, 5 and 7 governing the payment of wages and ratio of apprentices and trainees to journey workers; provided that, if wage rates higher than those required under these regulations are imposed by state or local law, nothing hereunder is intended to relieve Developer of its obligation, if any, to require payment of the higher wage. Developer shall cause or require to be inserted in full, in all such contracts subject to such regulations, provisions meeting the requirements of this paragraph. 14.14.3 If Davis -Bacon is applicable, Developer shall provide City access to employee payrolls, contractor and subcontractor payrolls and other wage infon nation for persons performing construction of the Required Improvements. Payrolls must be submitted to the HED Department with each Reimbursement Request, and must be available to HED Department staff upon request. In addition, Developer shall ensure that City will have access to employees, contractors and subcontractors and their respective employees in order to conduct onsite interviews with laborers and mechanics. Developer shall inform its contractors and subcontractors that City staff or Federal agencies may conduct periodic employee wage interview visits during construction of the project to ensure compliance 14.15 Subcontracting with Small and Minority Firms. Women's Business Enterprises and Labor Surplus Areas. 14.15.1 For procurement contracts $50,000.00 or larger Developer agrees to abide by City's policy to involve Minority Business Enterprises and Small Business Enterprises and to provide them equal opportunity to compete for contracts for construction, provision of professional services, purchase of equipment and supplies and provision of other services required by City. Developer agrees to incorporate the City's BDE Ordinance, and all amendments or successor policies or ordinances thereto, into all contracts and subcontracts for procurement $50,000.00 or larger, and will further require all persons or entities with which it so contracts to comply with said ordinance. 14.15.2 It is national policy to award a fair share of contracts to disadvantaged business enterprises ("DBEs"), small business enterprises ("SBEs"), minority business enterprises ("MBEs"), and women's business enterprises ("WBEs"). Accordingly, affirmative HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 32 steps must be taken to assure that DBEs, SBEs, MBEs, and WBEs are utilized when possible as sources of supplies, equipment, construction and services 14.16 Other Laws. The failure to list any federal, state or City ordinance, law or regulation that is applicable to Developer does not excuse or relieve Developer from the requirements or responsibilities in regard to following the law, nor from the consequences or penalties for Developer's failure to follow the law, if applicable. 14.17 Assignment Developer shall not assign all or any part of its rights, privileges, or duties under this Contract without the prior written approval of City. Any attempted assignment of same without approval shall be void, and shall constitute a breach of this Contract. 14.18. Right to Inspect Developer Contracts. It is agreed that City has the right to inspect and approve in writing any proposed contracts between Developer, its general contractor and subcontractors, including any lower tier subcontractors engaged in any activity that is funded as part of the construction of the Required Improvements prior to any charges being incurred. 14.19 Force Majeure If Developer becomes unable, either in whole or part, to fulfill its obligations under this Contract due to acts of God, strikes, lockouts, or other industrial disturbances, acts of public enemies, wars, blockades, insurrections, riots, epidemics, earthquakes, fires, floods restraints or prohibitions by any court, board, department, commission or agency of the United States or of any States civil disturbances, or explosions or some other reason beyond Developer's control (collectively, "Force Majeure Event"), the obligations so affected by such Force Majeure Event will be suspended only during the continuance of such event and the completion date for such obligations shall be extended for a like period. Developer will give City written notice of the existence, extent and nature of the Force Majeure Event as soon as reasonably possible after the occurrence of the event Failure to give notice will result in the continuance of the Developer's obligation regardless of the extent of any existing Force Majeure Event. Developer will use commercially reasonable efforts to remedy its inability to perfonu as soon as possible. 14.20 Survival. Any provision of this Contract that pertains to Affordability Requirements, auditing, monitoring, tenant income eligibility, record keeping and reports City ordinances, the provisions of Section 6.6 pertaining to the Federal System Award Management, or any HOME requirements, and any default and enforcement provisions necessary to enforce such provisions, shall survive the termination of this Contract for the longer of (i) 5 years after the termination date of this Contract, or (ii) 1 year after the termination of the Affordability Period unless a different survival period is specifically set forth herein, and shall be enforceable by City against Developer. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 33 15. INDEMNIFICATION AND RELEASE. DEVELOPER COVENANTS AND AGREES TO INDEMNIFY, HOLD HARMLESS AND DEFEND, AT ITS OWN EXPENSE, CITY AND ITS OFFICERS, AGENTS, SERVANTS AND EMPLOYEES FROM AND AGAINST ANY AND ALL CLAIMS OR SUITS FOR PROPERTY LOSS OR DAMAGE AND/OR PERSONAL INJURY, INCLUDING DEATH, TO ANY AND ALL PERSONS, OF WHATSOEVER KIND OR CHARACTER, WHETHER REAL OR ASSERTED, ARISING OUT OF OR IN CONNECTION WITH THE EXECUTION, PERFORMANCE, ATTEMPTED PERFORMANCE OR NONPERFORMANCE OF THIS CONTRACT AND/OR THE OPERATIONS, ACTIVITIES AND SERVICES OF THE PROJECT DESCRIBED HEREIN, WHETHER OR NOT CAUSED IN WHOLE OR IN PART, BY ALLEGED NEGLIGENCE OF OFFICERS, AGENTS, SERVANTS, EMPLOYEES, CONTRACTORS OR SUBCONTRACTORS OF CITY, AND DEVELOPER HEREBY ASSUMES ALL LIABILITY AND RESPONSIBILITY OF CITY AND ITS OFFICERS, AGENTS, SERVANTS, AND EMPLOYEES FOR ANY AND ALL CLAIMS OR SUITS FOR PROPERTY LOSS OR DAMAGE AND/OR PERSONAL INJURY, INCLUDING DEATH, TO ANY AND ALL PERSONS, OF WHATSOEVER KINDS OR CHARACTER, WHETHER REAL OR ASSERTED, ARISING OUT OF OR IN CONNECTION WITH THE EXECUTION, PERFORMANCE, ATTEMPTED PERFORMANCE OR NONPERFORMANCE OF THIS CONTRACT AND AGREEMENT AND/OR THE OPERATIONS, ACTIVITIES AND SERVICES OF THE PROJECT DESCRIBED HEREIN, WHETHER OR NOT CAUSED IN WHOLE OR IN PART BY ALLEGED NEGLIGENCE OF OFFICERS, AGENTS, SERVANTS, EMPLOYEES, CONTRACTORS OR SUBCONTRACTORS OF CITY. DEVELOPER LIKEWISE COVENANTS AND AGREES TO AND DOES HEREBY INDEMNIFY AND HOLD HARMLESS CITY FROM AND AGAINST ANY AND ALL INJURY, DAMAGE OR DESTRUCTION OF PROPERTY OF CITY, ARISING OUT OF OR IN CONNECTION WITH ALL ACTS OR OMISSIONS OF DEVELOPER, ITS OFFICERS, MEMBERS, AGENTS, EMPLOYEES, CONTRACTORS, SUBCONTRACTORS, INVITEES, LICENSEES, OR PROJECT PARTICIPANTS, OR CAUSED, IN WHOLE OR IN PART, BY ALLEGED NEGLIGENCE OF OFFICERS, AGENTS, SERVANTS, EMPLOYEES, CONTRACTORS OR SUBCONTRACTORS OF CITY. IT IS THE EXPRESS INTENTION OF THE PARTIES, BOTH DEVELOPER AND CITY, THAT THE INDEMNITY PROVIDED FOR THIS SECTION INCLUDES INDEMNITY BY DEVELOPER TO INDEMNIFY AND PROTECT CITY FROM THE CONSEQUENCES OF CITY'S OWN NEGLIGENCE, WHETHER THAT NEGLIGENCE IS ALLEGED TO BE THE SOLE OR CONCURRING CAUSE OF THE INJURY, DAMAGE OR DEATH. DEVELOPER AGREES TO AND SHALL RELEASE CITY, ITS AGENTS, EMPLOYEES, OFFICERS AND LEGAL REPRESENTATIVES FROM ALL LIABILITY FOR INJURY, DEATH, DAMAGE OR LOSS TO PERSONS OR PROPERTY SUSTAINED IN CONNECTION WITH OR INCIDENTAL TO PERFORMANCE UNDER THIS CONTRACT, EVEN IF THE INJURY, DEATH, HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 34 DAMAGE OR LOSS IS CAUSED BY CITY'S SOLE OR CONCURRENT NEGLIGENCE. DEVELOPER SHALL REQUIRE ALL OF ITS CONTRACTORS AND SUBCONTRACTORS TO INCLUDE IN THEIR CONTRACTS AND SUBCONTRACTS A RELEASE AND INDEMNITY IN FAVOR OF CITY IN SUBSTANTIALLY THE SAME FORM AS ABOVE. 16. WAIVER OF IMMUNITY BY DEVELOPER If Developer is a charitable or nonprofit organization and has or claims an immunity or exemption (statutory or otherwise) from and against liability for damages or injury including death to persons or property, Developer hereby expressly waives its rights to plead defensively such immunity or exemption as against City. This section shall not be construed to affect a governmental entity's immunities under constitutional, statutory or common law. 17. INSURANCE AND BONDING. Developer will maintain coverage in the form of insurance or bond in the amount of $240,000.00 to insure against loss from the fraud, theft or dishonesty of any of Developer's officers, agents trustees, directors or employees. The proceeds of such insurance or bond shall be used to reimburse City for any and all loss of HOME Funds occasioned by such misconduct. To effectuate such reimbursement, such fidelity coverage shall include a rider stating that reimbursement for any loss or losses shall name the City as a Loss Payee. Developer shall furnish to City, in a timely manner, but not later than 10 days after the Effective Date, certificates of insurance as proof that it has secured and paid for policies of commercial insurance as specified herein. If City has not received such certificates as set forth herein, Developer shall be in default of the Contract and City may at its option, terminate the Contract. Such insurance shall cover all insurable risks incident to or in connection with the execution, performance, attempted performance or nonperfoiuiance of this Contract. Developer shall maintain, or require its general contractor to maintain, the following coverages and limits thereof: Commercial General Liability (CGL) Insurance $1,000,000 each occurrence $2,000,000 aggregate limit Business Automobile Liability Insurance $1,000,000 each accident on a combined single -limit basis, or $ 250,000 Property Damage $ 500,000 Bodily Injury per person per occurrence $2,000,000 Aggregate HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 35 Insurance policy shall be endorsed to cover "Any Auto" defined as autos owned, hired and non -owned Pending availability of the above coverage and at the discretion of City the policy shall be the primary responding insurance policy versus a personal auto insurance policy if or when in the course of Developer's business as contracted herein Workers' Compensation Insurance Part A: Statutory Limits Part B: Employer's Liability $100,000 each accident $100,000 disease -each employee $500,000 disease -policy limit Note: Such insurance shall cover employees performing work on any and all projects including but not limited to construction, demolition, and rehabilitation. Developer or its contractors shall maintain coverages, if applicable. In the event the respective contractors do not maintain coverage, Developer shall maintain the coverage on such contractor, if applicable, for each applicable contract. Additional Requirements Such insurance amounts shall be revised upward at City's reasonable option and no more frequently than once every 12 months, and Developer shall revise such amounts within 30 days following notice to Developer of such requirements Developer will submit to City documentation that it, and its general contractor, have obtained insurance coverage and have executed bonds as required in this Contract prior to payment of any monies provided hereunder. Where applicable, insurance policies required herein shall be endorsed to include City as an additional insured as its interest may appear. Additional insured parties shall include employees, officers, agents, and volunteers of City. The Workers Compensation Insurance policy shall be endorsed to include a waiver of subrogation, also referred to as a waiver of rights of recovery, in favor of City. Any failure on part of City to request certificate(s) of insurance shall not be construed as a waiver of such requirement or as a waiver of the insurance requirements themselves. Insurers of Developer's insurance policies shall be licensed to do business in the state of Texas by the Department of Insurance or be otherwise eligible and authorized to do business in the state of Texas. Insurers shall be acceptable to City insofar as their financial strength and solvency and each such company shall have a current minimum A.M Best Key Rating Guide rating of A: VII or other equivalent insurance industry standard rating otherwise approved by City. Deductible limits on insurance policies shall not exceed $5,000 per occurrence unless otherwise approved by City. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 36 In the event there are any local, federal or other regulatory insurance or bonding requirements for the project, and such requirements exceed those specified herein, the former shall prevail. Developer shall require its contractors to maintain applicable insurance coverages, limits, and other requirements as those specified herein; and, Developer shall require its contractors to provide Developer with certificate(s) of insurance documenting such coverage. Also, Developer shall require its contractors to have City and Developer endorsed as additional insureds (as their interest may appear) on their respective insurance policies. Professional Liability coverage shall be in force and may be provided on a claim's made basis. This coverage may also be referred to as Management Liability, and shall protect the insured against claims arising out of alleged errors in judgment, breaches of duty and wrongful acts arising out of their management duties. Developer shall require its builder to maintain builders risk insurance at the value of the construction. 18. CERTIFICATION REGARDING LOBBYING. The undersigned Developer hereby certifies, to the best of its knowledge and belief, that: No Federal appropriated funds have been paid or will be paid by or on behalf of Developer, to any person for influencing or attempting to influence an officer or employee of any agency, a member of Congress, an officer or employee of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan or cooperative agreement. If any funds other than federally appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, member of Congress in connection with this Federal contract, grant, loan or cooperative agreement, Developer shall complete and submit Standard Form-LLL, "Disclosure Form to Report Lobbying, ' in accordance with its instructions. This certification is a matenal representation of fact upon which reliance was placed when this Contract was made or entered into. Submission of this certificate is a prerequisite for making or entering into this Contract imposed by 31 U.S.C. Section 1352. Any person who fails to file the required certification shall be subject to a civil penalty of not less than $10,000.00 and not more than $100,000.00 for each such failure. Developer shall require that the language of this certification be included in all subcontracts or agreements involving the expenditure of Federal funds. HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 37 19. LITIGATION AND CLAIMS. Developer shall give City immediate notice in writing of any action, including any proceeding before an administrative agency, filed against Developer in conjunction with this Contract or the project. Developer shall furnish immediately to City copies of all pertinent papers received by Developer with respect to such action or claim. Developer shall provide a notice to City within 10 days upon filing under any bankruptcy or financial insolvency provision of law. 20. NOTICE. All notices required or permitted by this Contract must be in writing and shall be effective upon receipt when (i) sent by U.S. Mail, with proper postage, certified mail return receipt requested or by a nationally recognized overnight delivery service; and (iii) addressed to the other Party at the address set out below or at such other address as the receiving Party designates by proper notice to the sending Party. City: City Attorney's Office 1000 Throckmorton Street Fort Worth, TX 76102 Attention: Vicki Ganske Telephones 817-392-7765 Copies to: Director of Housing and Economic Development Department 1000 Throckmorton Street Fort Worth, TX 76102 Attentions Assistant Director Telephone: 817-392-7540 Housing and Economic Development Department 1000 Throckmorton Street Fort Worth, TX 76102 Attention: Avis Chaisson, Project Coordinator Telephone: 817-392-6342 Developer: Western Center Reserve, LLC c/o Miller Valentine Group 9349 Waterstone Blvd. Cincinnati OH 45249 Attention: David Liette HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 38 Copies to: Locke Lord LLP 600 Congress Ave, Ste 2200 Austin, TX 78701 Attention: Cynthia Bast, Esq. Investor Member: Bank of America, N.A. c/o Bank of America Merrill Lynch Tax Credit Equity Investment Asset Management NC 1-007-11-25 100 North Tryon Street Charlotte, NC 28202 Attention: Nicole Baldon, Vice President Copies to: Sidley and Austin, LLP One South Dearborn Street, Chicago IL 60603 Attention. David R. Hill 21. DEVELOPER HAS LEGAL AUTHORITY TO ENTER INTO CONTRACT., Developer represents that it possesses the legal authority, pursuant to any proper appropriate and official motion, resolution or action passed or taken, to enter into this Contract and to perform the responsibilities herein required. 22. INVESTOR MEMBER'S RIGHT TO CURE. The Parties agree that the Investor Member shall have the right, but not the obligation, to cure any default by or complete any obligation of the Developer under the Loan Documents during the cure period or completion period provided therein, and the Parties hereto agree to accept any such cure or completion tendered by the Investor Member. 23. COUNTERPARTS. This Contract may be executed in multiple counterparts, each of which shall be considered an original, but all of which shall constitute one instrument which may be sufficiently evidenced by one counterpart. [SIGNATURES APPEAR ON NEXT PAGE] HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 39 c jf . c T !7 c. ‘-us 0 a":` .tt irict;`f��#a%le on the last date indicated below the Parties' signatures. SIGNATURE PAGE TO HOME CONTRACT EST: kit �itySecretary M&C: C-25489 Dated March 20, 2012 ITNESS WHEREOF, the Parties have executed 4copies of this Contract to be • It- • CITY OF FORT WORTH By: 5;;;:2Q Fernando Costa, Assistant City Manager Date: /0/2l43 APPROVED AS TFO ' ,u,AND LEGALITY: Vicki S. Ganske, Senior Assistant City Attorney WESTERN CENTER RESERVE, LLC f a Texas limited liability company By: MV Western Center Reserve LLC an Ohio limited liability company Its: Managing Member By: MV Affordable Housing LLC an Ohio li ' - d liability company Its. Sole Me OFFICIAL RECORD CITY SECRETARY FtWORTH,TX STATE OF TEXAS COUNTY OF TARRANT This instrument was acknowledged before Fernando Costa, Assistant City Manager of the Worth. a • . rl • aY PiEVONIA DANIELS .• vi Notary Public, State of Texas t �� lei My Commission Expires �"�-Pof :r' July 10,2017 00/111/0 IIj/111i . •. .a •- 1•-iir •• HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC By: Name: Elizabeth A. Its: Authorized Signer may: Name: gan Jack H. Goodwin Its: Authorized Signer Date: /15113 l me on . 2013 by ity of Fort Wort on behalf the City of Fort 41-ted tary Public, State of Texas Page 40 STATE OF OHIO § COUNTY OF WARREN § Before me, the undersigned authority, on this day personally appeared Elizabeth A. Mangan known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he/she executed the same for the purposes and consideration therein expressed. Giv n er,,my hand and seal this (r ? day of Octobers 2013 . A R 1, (�,,,,,/ Public r 49(44.4 1./}(CetC's A {� MARILEE F. BROWN, �Y - 1..7 ` =. in and for the State .= - = • • Ecpirs 1 ` ,.."{ ;,r = My Commission s ice"' . 1• ' an No4a rrrri it rice(Printed): �r My commission expires: 1 Ohio Notary Public nvii‘ STATE OF OHIO § COUNTY OF WARREN § Before me, the undersigned authority,on this daypersonally appeared Jack H. Goo wvn• g p Y pp known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he/she executed the same for the purposes and consideration therein expressed. 'rrt der myhand and seal this �� dayof Octob r, ,, ( t2013 b•••••• is•DICI,"..44%.* /.//1„...-Coiltect A, V) -1E14 • St. _ .-Itiz .- ...tLL�: ARtIFE F BROWN, Notary Public Notary Public bk- . � _ :.�." In and for theMate f Q io .. = �►'.� y.i♦- .ten •l My Commission Expires I rse • :` •%• . • • • ♦ ''Name (Printed): My commission expires: HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Page 41 EXHIBITS: Exhibit Exhibit Exhibit Exhibit Exhibit Exhibit Exhibit Exhibit Exhibit Exhibit Exhibit Exhibit "A" — Project Summary "A-1" — HUD Rent Limits "A-2" — Environmental Mitigation Action (Not Applicable) "B" — Budget "C" — Construction and Reimbursement Schedule "D" — Audit Requirements "E" — Loan Documents "F" — Reimbursement Forms "G" —Project Compliance Report: Rental Housing "H" — Davis -Bacon (Not Applicable) "I" — Section 3 Reporting Forms "J" — Standards for Complete Documentation HOME DEVELOPER RENTAL CONTRACT Western Center Reserve, LLC Rev 10-17-13 Page 42 EXHIBIT "A" PROJECT SUMMARY WESTERN CENTER RESERVE, LLC DESCRIPTION: Capitalized terms not defined herein shall have meanings assigned to them in the Contract. Western Center Reserve, LLC ( Developer") will use Home Funds for a portion of the costs to develop the Reserve at Western Center a multifamily rental development to be located on an approximately 10 660 acre site at the southwest corner of Western Center Blvd. and Watauga - Smithfield Road, Fort Worth, TX 76131. The project will have 6 residential buildings with up to 120 units including 12 one-bedroom/one bath units, 60 two-bedroom/one and two bath units, and 48 three-bedroom/two bath units. There will also be a non-residential building which will serve as the project's clubhouse. The complex will include amenities such as exercise room, activity room, mailroom, laundry room and a pool. Developer will be entitled to make Reimbursement Requests until 30 days after the Completion Deadline. In consideration for HOME Funds provided through this Contract, Developer agrees to provide the following information and meet the following requirements: • Designate 9 Accessible Units in accordance with Section 504 requirements. Of these 9 units, 6 must be accessible to individuals with mobility impairments, and the other 3 must be accessible to individuals with visual or hearing impairments. Accessible Units shall be marketed in accordance with Section 7.6.5 of the Contract. • Designate 4 floating HOME Units. All of the HOME Units will be affordable to low and moderate income tenants whose incomes are 80% or less of AMI. • HOME Rents will be charged in accordance with the rents set forth in Exhibit ' A-1" — HUD Rent Limits set annually by HUD, and shall not exceed the High HOME Rent limit. • Submit Exhibit "G" - Project Compliance Report: Rental Housing regarding the household income, size, race, ethnicity, gender of head of household, disability status, and rental assistance type for the initial tenant of the first HOME Unit to be leased. CITY WILL WITHHOLD $10,000.00 OF THE HOME FUNDS UNTIL CITY VERIFIES THAT AT LEAST 1 HOME UNIT IS LEASED TO A HOME ELIGIBLE HOUSEHOLD. • If the HOME Units do not qualify as affordable rental housing immediately upon lease -up or at any time during the Affordability Period, the City may invoke any remedies provided in the Contract or the Loan Documents • Submit to City a copy of its annual audit and reports to TDHCA during the Affordability Period SPECIFIC PURPOSE• The specific purpose of this project is to increase the availability of quality, accessible, affordable housing for low and moderate income City residents in north Fort Worth. PROJECT OBJECTIVES • The project will provide 120 housing units affordable to households earning at or below 60% of AMI. Four units will be designated as HOME -assisted units. HOME DEVELOPER RENTAL CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 EXHIBIT "A-1" HUD RENT LIMITS WESTERN CENTER RESERVE LLC U.S. DEPARTMENT OF HUD 04/2013 STATE: TEXAS 2013 HOME PROGRAM RENTS PROGRAM EFFICIENCY 1 BR 2 BR 3 BR 4 BR 5 BR 6 BR *Fort Worth -Arlington, TX HUD Metro MR Area LOW HOME RENT LIMIT 606 649 778 900 1003 1108 1211 HIGH HOME RENT LIMIT 639* 700* 865 1136 1248 1358 1469 For Information Only: FAIR MARKET RENT 571 668 865 1160 1381 1588 1795 50% RENT LIMIT 606 649 778 900 1003 1108 1211 65% RENT LIMIT 768 824 991 1136 1248 1358 1469 *Rent limits are published at least annually by HUD. Developer must use the most current HUD rent limits in setting rents for the project. HOME DEVELOPER RENTAL CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 EXHIBIT "A-2" ENVIRONMENTAL MITIGATION ACTION WESTERN CENTER RESERVE, LLC NOT APPLICABLE HOME DEVELOPER RENTAL CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 Source # 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 TOTAL SOURCES OF FUNDS TOTAL USES OF FUNDS EXHIBIT "B" BUDGET WESTERN CENTER RESERVE, LLC SOURCES AND USES Development Name: I Reserve at Western Center Funding Description Conventional Loan Conventional Loan/FHA HTC Syndication Proceeds HOME Housing Trust Fund CDBG Mortgage Revenue Bonds Historic Tax Credit Syndication Proceeds USDA/ TXRD Loan(s) Other Federal Loan or Grant Other State Loan or Grant Local Government Loan or Grant (HOME) Private Loan or Grant Cash Equity In -Kind Equity/Deferred Developer Fee Operating Reserves Priority of Lien 1st 2nd Construction or Rehab Loan Stage Amt. $13,171,967 $2,676,232 $240,000 $16,088,199 Permanent Loan Stage Amount $3,405,000 $10,704,930 $863,063 HOME Funds Budget Acquisition, Lot Prep/Plumbing/Foundation Framing/Siding/Mechani cals Inspections/Insulation/Sheet Rock/Brick/Interior Trim/Paint Flooring/Mechanical Trim/Appliances & Fixtures/Final Punch List Holdback* TOTAL I * City will hold back $10,000 of the HOME Funds until City verifies that a HOME Unit is leased to a HOME Eligible Household. $14,972,993 $14,972,993 Financing Participants Bank of America, N.A. City of Fort Worth 1 i 1 $20,000 $50,000 $60,000 $100,000 $10,000 $240,000 HOME DEVELOPER RENTAL CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 PHASE I ACTIVITIES: PHASE I COMPLETE by: December 31, 2013 EXHIBIT "C" CONSTRUCTION AND REIMBURSEMENT SCHEDULE WESTERN CENTER RESERVE, LLC Activity Acquisition HOME Contract signed Soft Costs Lot Preparation (Grading) Plumbing Foundation Contractor/subcontractor/vendor searches under the Federal System for Award Management (www.sam.aov) must be submitted prior to any reimbursement under Phase I. First Payment PHASE II ACTIVIITES: Framing / TPW PHASE II COMPLETE by: March 15, 2014 PHASE III ACTIVIITES: Mechanicals / Siding / Paint Contractor/subcontractor/vendor searches under the Federal System for Award Management (www.sam.2ov) must be submitted prior to any reimbursement under Phase II. Second Payment** Inspections / Insulation Sheetrock / Brick Interior Trim / Paint HOME Funds $1,000.00 $1,500.00 $8,750.00 $8,750.00 $20,000.00* $25,000.00 $25,000.00 $50,000.00* $5,000.00 $30,000.00 $25,000.00 HOME DEVELOPER RENTAL CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 Contractor/subcontractor/vendor searches under the Federal PHASE III COMPLETED System for Award Management (www.sam.gov) must be by: July 31.2014 submitted prior to any reimbursement under Phase III. Third Payment** PHASE IV ACTIVIITES: Flooring Mechanical Trim / Grading / Landscaping Final Trim / Appliances and Fixtures / Fencing Final Inspections Punch List PHASE IV COMPLETED Initial Lease -up of HOME Units by: December 31.2014 Contractor/subcontractor/vendor searches under the Federal System for Award Management (www.sam.2ov) must be submitted prior to any reimbursement under Phase IV. In addition, the following items must be submitted prior to reimbursement in Phase IV: 1. Rent Schedule for HOME Units. 2. Tenant Selection Policy. 3. Affirmative Marketing Plan. $60,000.00* $10,000.00 $10,000.00 $20,000.00 $60,000.00 Third Payment** $100,000.00* Prior to Reimbursement for Final Payment, Exhibit "G" - Project Compliance Report: Rental Housing must be submitted to City. Final Payment/Holdback** TOTAL $10,000* $240,000.00* HOME DEVELOPER RENTAL CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 *Developer will only be reimbursed for eligible expenses. The amounts are estimates and are subject to change. **Developer must submit Reimbursement Requests and Complete Documentation to City within 60 days from each of the abovementioned deadlines in order to be reimbursed. Failure to timely submit Reimbursement Requests and Complete Documentation along with any required reports shall be an event of default. HOME DEVELOPER RENTAL CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 EXHIBIT "D" AUDIT REQUIREMENTS WESTERN CENTER RESERVE, LLC CITY OF FORT WORTH HOUSING AND ECONOMIC DEVELOPMENT DEPARTMENT AUDIT REQUIREMENTS Organizations expending $500,000 or more in federal awards (from City of Fort Worth and other funding sources) during their fiscal years shall obtain either an annual single audit or a program specific audit. Organizations may have a program specific audit in accordance with OMB Circular A-133, or other standard set forth in the Contract if applicable, if they expended funds for only one federal program as listed in the Catalog of Federal Domestic Assistance (CFDA). If funds are spent for more than one federal program, a single audit is required. The audited time period is the organization's fiscal year, and not the City of Fort Worth's funding period. The audit shall be conducted by a certified public accountant (CPA) that is licensed at the time of the audit by the appropriate regulatory body. The CPA shall meet all of the general standards concerning qualifications, independence, due professional care and quality control as required by Government Auditing Standards, including the requirements for continuing professional education and external peer reviews. Auditor selection must adhere to federal procurement requirements. A separate supplementary schedule of revenues, expenditures and changes in fund balance for each City of Fort Worth contract is no longer required. The Schedule of Expenditures of Federal Awards should list City of Fort Worth 's contract numbers, the total expended for each individual federal program, and the CFDA number (OMB A-133 § .310). The independent auditor s report should include all of the relevant items listed on the 'Audit Report Checklist." Additional guidance on the conduct and reporting of these audits is contained in the latest issuance of the following publications: Government Auditing Standards issued by the Comptroller General of the United States, 2003 OMB Circular A-133 as revised 6/30/97 and amended June 2003 OMB Circular A-133 Compliance Supplement AICPA's Statement of Position 98-3, "Audits of States, Local Governments, and Not -for -Profit Organizations Receiving Federal Awards" Various AICPA audit guides for nonprofits, colleges and universities and health and welfare organizations AICPA's Audit Risk Alert "State and Local Governmental Developments" Government Auditing Standards by the Texas Department of Houstng and Community Affairs for Properties Receiving Low Income Housing Tax Credits All organizations that receive a City of Fort Worth award must submit the provided Audit Certification Form which certifies whether you are subject to a single/program audit. Organizations receiving federal awards from the City of Fort Worth who are not required to have an audit shall certify in writing to the agency. The organization s Chief Executive Officer or Chief Financial Officer shall make the certification within 60 days of the end of the organization's fiscal year in the year that the project was completed. The following items should be submitted to the City of Fort Worth Housing and Economic Development Department within the required timeframe• HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 Due 60 days after organization's fiscal year end in the year that the protect was completed: (required for all subrecipients) Completed Audit Certification Form Due within the earlier of 30 days after receipt of the auditor's report or nine months after the end of the audit period. Two copies of the entire audit report issued by the CPA Two copies of any management letter issued by the CPA in conjunction with the audit report Two copies of management's comments on all findings, recommendations, & questioned costs contained in the audit report and management letter, including a detailed corrective action plan Failure to submit any of these items by the required due date may result in holds on current draw requests, suspension of the organization's contract(s) and eligibility for future funding. If the organization does not meet the requirements of having a single/program audit conducted, records must still be kept available for review or audit by City of Fort Worth staff (OMB A-133 Subpart B Sec 200(d). If additional information is needed concerning the audit requirements, please call (817) 392-6141. HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 CITY OF FORT WORTH HOUSING AND ECONOMIC DEVELOPMENT DEPARTMENT SINGLE AUDIT REPORT CHECKLIST The Department developed this checklist to help organizations improve the quality and completeness of audit reports. General Purpose or Basic Financial Statements of the Organization Opinion/Report on Organization's Financial Statements in accordance with Government Auditing Standards Notes to the General Purpose or Basic Financial Statements of the Organization A Schedule of Expenditures of Federal Awards, including the Department's contract numbers, the total expended for the federal program, and the CFDA number (OMB A-133 Subpart C Sec 310). Opinion/Report on Schedule of Expenditures of Federal and State Awards Report on Compliance and on Internals Control Over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance With Government Auditing Standards. (OMB A-133 § 505 (b)) Report on Compliance with Requirements Applicable to Each Major Program and Internal Control over Compliance in Accordance with OMB Circular A-133. (OMB A-133 § 505 (c)) Schedule of Findings and Questioned Costs (OMB A-133 §. 505d), including: Summary Schedule of Prior Audit Findings reporting the status of all findings included in the prior audit's schedule of findings and questioned costs. (OMB A-133 Sec. 315 (a) and (b)) Corrective Action Plan including (OMB A-133 Sec. 315 (c)) name of person responsible for the corrective action, corrective action planned, anticipated completion date, and explanation and reason if auditee does not agree with findings or believes correction is not required. All reports are signed and dated by the auditor Two copies of the audit reports are submitted Two copies of the management letter, if issued in conjunction with the audit report. Two copies of comments by management concerning all findings and recommendations included in management letter, including a corrective action plan. HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 CITY OF FORT WORTH HOUSING AND ECONOMIC DEVELOPMENT DEPARTMENT Audit Certification Form Subrecipient• Western Center Reserve, LLC. Fiscal Year Ending* / / Month / Day /Year We have exceeded the federal expenditure threshold of $500,000. We will have our Single Audit or Program Specific Audit completed and will submit the audit report within nine (9) months after the end of the audited fiscal year. U We did not exceed the $500,000 federal expenditure threshold required for a Single Audit or a Program Specific Audit to be performed this fiscal year. (Fill out schedule below) Must be filled out if Single Audit or Program Audit is not required: Federal Grantor Federal Expenditure Disclosure Federal Funds Pass Through Grantor Program Name & CFDA Number Total Federal Expenditures for this Fiscal Year $ Contract Number Printed Name Title (Must be CFO, CEO or equivalent) Authorized Signature (Must be CFO, CEO or equivalent) Phone Number Date Exnenditures Failure to submit this or a similar statement or failure to submit a completed single audit package as described in the audit requirements by the required due date will result in suspension of funding and will affect eligibility for future funding. Submit this form to the City of Fort Worth Housing and Economic Development Department within 60 days after the end of your Fiscal year HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 EXHIBIT "E" LOAN DOCUMENTS WESTERN CENTER RESERVE, LLC HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 i Promissory Note HOME Funds Date: October 18, 2013 Borrower: Western Center Reserve, LLC Borrower's Mailing Address: Western Center Reserve, LLC 9349 Waterstone Blvd Cincinnati, OH 45249 With a copy to: Locke Lord LLP 600 Congress Ave, Suite 2200 Austin, TX 78701 Attention: Cynthia Bast Lender: City of Fort Worth, a Texas municipal corporation Place for Payment: City of Fort Worth Housing and Economic Development Department Attention: Assistant Director 1000 Throckmorton Street Fort Worth, Tarrant County, Texas 76102, or any other place that Lender may designate in writing. Principal Amount: $240,000.00 Loan Authority: The loan evidenced by this Note (the "Loan") is being made pursuant to the HOME Investment Partnerships Program authorized under Title II of the Cranston -Gonzalez National Affordable Housing Act of 1990, as amended 42 USC 12701 et seq. (` HOME Program') and the HOME Investment Partneiships Program Final Rule, as amended, 24 CFR Part 92 et seq. (the "HOME Regulations") with HOME funds. Annual Interest Rate: The lesser of 1% or the Short Term Applicable Federal Rate ("AFR") on the date hereof, which is 0.32% Maturity Date: October 17, 2016 Annual Interest Rate on Matured, Unpaid Amounts: 12% PROMISSORY NOTE — HOME FUNDS Western Center Reserve, LLC Page 1 rev10-17-13 Terms of Payment: Interest will accrue on any advance of Loan proceeds under this Note at the Annual Interest Rate. Interest will be calculated based on a 360 day per year factor applied to the actual days on which there exists an unpaid principal balance. The Principal Amount and any accrued, unpaid interest will be payable in full on the Maturity Date. Any payments will be applied first to accrued interest and the remainder to reduction of the Principal Amount. This Note is the Note required in City Secretary Contract No. 43273 between Borrower and Lender (the "Contract") and has been executed and delivered in accordance with it. The funds advanced by Lender are HOME funds and the Contract requires that the 4 residential rental units assisted with HOME funds located on the Property (the HOME Units") must qualify and remain affordable rental housing in accordance with the HOME Program and the HOME Regulations for the 20 year Affordability Period more particularly defined in the Contract. The obligations described in the Contract pertaining to the HOME Program and the HOME Regulations including the Affordability Period as well as the Loan evidenced by this Note will be in default if the HOME Units more particularly described in the Contract do not remain affordable rental housing for the duration of the Affordability Period, subject to the "next available unit rule" under the Internal Revenue Code Section 42 (g) (2) (D). In the event of such default, Lender may invoke any remedies provided in the Contract or the Deed of Trust Security Agreement — Financing Statement for default. Security for Payment: This Note is secured by a Deed of Trust Security Agreement - Financing Statement dated October 18, 2013 from Borrower to Vicki S. Ganske Trustee or Leann D. Guzman Trustee (the "Deed of Trust') which covers the personal property described therein and the followmg real property: Lot 1, Block 1, Reserve at Western Center, an Addition to the City of Fort Worth, Tarrant County, Texas, according to the plat thereof recorded under Clerk's File No. D213268904, Official Public Records, Tarrant County, Texas (the `Property") Other Security for Payment: As set forth in the Contract Borrower promises to pay to the order of Lender the Principal Amount plus interest. This Note is payable at the Place for Payment and according to the Terms of Payment. All unpaid amounts are due by the Maturity Date. After the Maturity Date, Borrower promises to pay any unpaid principal balance plus interest at the Annual Interest Rate on Matured, Unpaid Amounts. If Borrower defaults in the payment of this Note or in the performance of its obligations under the Contract or the HOME Program or the HOME Regulations or in the PROMISSORY NOTE — HOME FUNDS Western Center Reserve, LLC Page 2 rev10-17-13 performance of any obligation in any instrument securing or collateral to this Note, Lender may declare the unpaid principal balance, earned interest, and any other amounts owed on the Note immediately due and payable. Borrower and each surety, endorser, and guarantor waive all demand for payment, presentation for payment, notice of intention to accelerate maturity, notice of acceleration of maturity, protest, and notice of protest, to the extent permitted by law. Notwithstanding anything to the contrary, if a monetary event of default occurs under the terms of any of the Loan documents, prior to exercising any remedies Lender shall give Borrower and each of the Members of the Borrower, as identified in the Amended and Restated Operating Agreement dated October 18, 2013, as may be amended from time to time (the "Operating Agreement") simultaneous written notice of such default. Borrower and each of the Members on behalf of Borrower shall have a period of 10 days after such notice is given within which to cure the default prior to exercise of remedies by Lender under the Loan documents Notwithstandmg anything to the contrary, if a non -monetary event of default occurs under the terms of any of the Loan documents, prior to exercising any remedies Lender shall give Borrower and each of the Members of the Borrower as identified in the Operating Agreement, simultaneous written notice of such default If the default is reasonably capable of being cured within 30 days, Borrower and each of the Members on behalf of Borrower shall have such period to effect a cure prior to exercise of remedies by Lender under the Loan documents. If the default is such that it is not reasonably capable of being cured within 30 days, and if Borrower or its Members on behalf of Borrower (a) initiates corrective action within said period, and (b) diligently, continually, and in good faith works to effect a cure as soon as possible, then Borrower or its Member as the case may be, shall have such additional time as is reasonably necessary to cuie the default prior to exercise of any remedies by Lender. In no event shall Lender be precluded from exercising remedies if its security becomes or is about to become materially jeopardized by any failure to cure a default or the default is not cured within 180 days after the first notice of default is given. Notices provided by Lender to Grantor's Members shall be provided to the following: Managing Member MV Western Center Reserve, LLC 9349 Waterstone Blvd Cincinnati, OH 45249 Attention: David R. Liette With copy to: Locke Lord LLP 600 Congress Ave, Ste 2200 Austin, TX 78701 Attention: Cynthia Bast, Esq. PROMISSORY NOTE — HOME FUNDS Western Center Reserve, LLC Page 3 rev10-17-13 1 PROMISSORY NOTE — HOME FUNDS Western Center Reserve, LLC Page 4 rev10-17-13 i Investor Member Bank of America, N.A c/o Bank of America Merrill Lynch Tax Credit Equity Investment Asset Management NC1-007-11-25 100 North Tryon Street Charlotte, NC 28202 Attention: Nicole Baldon, Vice President With copy to: Banc of America CDC Special Holding Company, Inc. c/o Bank of America Merrill Lynch Tax Credit Equity Investment Asset Management NC1-007-11-25 100 North Tryon Street Charlotte, NC 28202 Attention: Nicole Baldon, Vice President With copy to: Sidley and Austin, LLP One South Dearborn Street, Chicago IL 60603 Attention: David R. Hill, Esq. Notices given to Grantor's Members shall be in writing and delivered to the addresses listed above, or to such other address as they designate by written notice to Lender. Each such notice or other communication shall be effective upon receipt when sent by U. S. Mail, postage prepaid and by certified mail, return receipt requested or by a nationally recognized overnight delivery service. Borrower also promises to pay reasonable attorney's fees and court and other costs if this Note is placed in the hands of an attorney to collect or enforce the Note. These expenses will bear interest from the date of default at the Annual Interest Rate on Matured, Unpaid Amounts. Borrower will pay Lender these expenses and interest on demand at the Place for Payment. These expenses and interest will become part of the debt evidenced by the Note and will be secured by any security for payment. Interest on the debt evidenced by this Note will not exceed the maximum rate or amount of non -usurious interest that may be contracted for, taken, reserved, charged, or received under law. Any interest in excess of that maximum amount will be credited on the Principal Amount or, if the Principal Amount has been paid, refunded. On any acceleration or required or permitted prepayment, any excess interest will be canceled automatically as of the acceleration or prepayment or, if the excess interest has already been paid, credited on the Principal Amount or, if the Principal Amount has been paid, refunded. This provision overrides any conflicting provisions in this Note and all other instruments concerning the debt. PROMISSORY NOTE — HOME FUNDS Western Center Reserve, LLC Page 5 rev10-17-13 i Note. Each Borrower, as applicable, is responsible for all obligations represented by this When the context requires, singular nouns and pronouns include the plural. The indebtedness evidenced by this Note is and shall be subordinate in right of payment to the prior payment in full of the indebtedness evidenced by a promissory note of even date herewith m the original principal sum of $13,171,967.00 made by Borrower payable to Bank of America, N.A ( the "Senior Indebtedness") as more particularly described in an Subordination Agreement between Lender, Borrower and Bank of America, N A (the "Subordination Agreement"), to the extent and in the manner provided in the Subordination Agreement. The Deed of Trust securing this Note is and shall be subject and subordinate in all respects to the liens, teuus, covenants and conditions of the mortgage securing the Senior Indebtedness as more fully set forth in the Subordination Agreement. The rights and remedies of the payee and each subsequent holder of this Note under the Deed of Trust securing this Note are subject to the restrictions and limitations set forth in the Subordination Agreement. Each subsequent holder of this Note shall be deemed, by virtue of such holder's acquisition of the Note, to have agreed to perform and observe all of the terms, covenants and conditions to be perfouured or observed by the Subordmate Lender under the Subordination Agreement. Subject to the terms of the Subordination Agreement and any cure periods provided in the documents evidencing the Senior Indebtedness, if there is a default in payment of any part of principal or interest of the Senior Indebtedness or a breach of any covenants contained in any instruments securing it, the debt evidenced by this Note will immediately become payable at the option of Lender If Borrower fails to perform any of Borrower's obligations in the promissory note evidencing the Senior Indebtedness or in any instruments securing same, and to the extent allowed by the Subordination Agreement, Lender may perform those obligations and be reimbursed by Borrower, on demand, at the Place for Payment for any amounts advanced, including attorney's fees, plus interest on those amounts from the date of payment at the Annual Interest Rate on Matured, Unpaid Amounts. The amount to be reimbursed will be secured by all instruments securing this Note. A default exists under this Note if (1) (a) Borrower or (b) any other person liable on any part of this Note (an "Other Obligated Party') fails to timely pay or perform any obligation or covenant in any written agreement between Lender and Borrower or such Other Obligated Party; (2) any warranty, covenant, or representation in this Note or in any other written agreement between Lender and Borrower or any Other Obligated Party is materially false when made; (3) a receiver is appointed for Borrower, any Other Obligated Party, or any property on which a lien or security interest is created as security (the "Collateral Security") for any part of this Note (4) any Collateral Security is assigned for the benefit of creditors other than the holder(s) of the Senior Note* (5) a bankruptcy or insolvency proceeding is commenced by Borrower or an Other Obligated Party; (6) (a) a bankruptcy or insolvency proceeding is commenced against Borrower or PROMISSORY NOTE — HOME FUNDS Western Center Reserve, LLC Page 6 rev10-17-13 i an Other Obligated Party and (b) the proceeding continues without dismissal for 90 days, the party against whom the proceeding is commenced admits the material allegations of the petition against it, or an order for relief is entered (7) any of the following parties is dissolved, begins to wind up its affairs, is authorized to dissolve or wind up its affairs by its governing body or persons, or any event occurs or condition exists that permits the dissolution or winding up of the affairs of any of the following parties: (i) Borrower, or (ii) an Other Obligated Party; and (8) any Collateral Security is materially impaired by loss, theft, damage, levy and execution, issuance of an official writ or order of seizure, or destruction, unless it is promptly replaced with insurance proceeds, collateral security of like kind and quality or restored to its former condition. The execution and delivery of this Note are required under the Contract. If any provision of this Note conflicts with any provision of the Contract, the Deed of Trust or any other document evidencing the same transaction between Lender and Borrower, the provisions of the Contract will govern to the extent of the conflict. This Note will be construed under the laws of the state of Texas without regard to choice -of -law rules of any jurisdiction. This Note is a nonrecourse obligation of Borrower. Neither Borrower not any of its Members nor any other party shall have any personal liability for repayment of the Loan described in the Contract. The sole recourse of Lender under the Loan documents for repayment of the Loan shall be the exercise of its rights against the Security for Payment. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] PROMISSORY NOTE — HOME FUNDS Western Center Reserve, LLC Page 7 rev10-17-13 THE CONTRACT, THE NOTE AND THE DEED OF TRUST CONSTITUTE THE FINAL AGREEMENT OF THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. WESTERN CENTER RESERVE, LLC, a Texas limited liability company By: MV Western Center Reserve, LLC, an Ohio limited liability company Its: Managing Member B y: Name: Its: By: Name: Its: PROMISSORY NOTE — HOME FUNDS Western Center Reserve, LLC By: MV Affordable Housing LLC, an Ohio limited liability company, Its: Sole Member Authorized Signer Authorized Signer Page 8 rev10-17-13 i NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER. Date: Grantor: Deed of Trust Security Agreement - Financing Statement HOME Funds Terms October18, 2013 Western Center Reserve, LLC, a Texas limited liability company Grantor's Mailing Address: Western Center Reserve, LLC 9349 Waterstone Blvd. Cincinnati, OH 45249 With a copy to: Locke Lord 600 Congress Ave, Suite 2200 Austin, TX 78701 Attention: Cynthia Bast Trustee: Vicki S. Ganske or Leann D. Guzman Trustee's Mailing Address: City Attorney's Office City of Fort Worth 1000 Throckmorton St. Fort Worth TX 76102 Tarrant County Lender: City of Fort Worth, a Texas municipal corporation DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 1 Rev. 10-17-13 Lender's Mailing Address: City of Fort Worth Housing and Economic Development Department Attention: Assistant Director 1000 Throckmorton Street Fort Worth, Texas 76102 Tarrant County Loan Authority: The loan evidenced by the Note (the "Loan") and secured by this Deed of Trust Security Agreement — Financing Statement (` Deed of Trust") is being made pursuant to the HOME Investment Partnerships Program authorized under Title II of the Cranston -Gonzales National Affordable Housing Act of 1990, as amended, 42 USC 12701 et seq. (the "HOME Program") and the HOME Investment Partnership Program Final Rule, as amended, 24 CFR Part 92 et seq. (the "HOME Regulations") with HOME funds. Obligations Note Date: October 18 2013 Original Principal Amount $240,000.00 Borrower: Western Center Reserve, LLC Lender: City of Fort Worth Terms of Payment: As provided in the Note Maturity Date: As described therein and in the Contract (as defined below) In addition, Obligations shall include compliance by Grantor with the requirements of the HOME Program for the 20 year Affordability Period more particularly described in Section F below. Property (including any improvements): Being a 10.340 tract of land situated in the Josiah Walker Survey, Abstract No. 1602, and the James A. Bradford Survey, Abstract Number 183, City Of Fort Worth, Tarrant County, Texas, and being more particularly described in the attached Exhibit "A" incorporated herein by reference for all purposes. Together with the following personal property: All fixtures, supplies, building materials, and other goods of every nature now or hereafter located, used, or intended to be located or used on the Property; All plans and specifications for development of or construction of improvements on the Property; All contracts and subcontracts relating to the construction of improvements on the Property; DEED OF TRUST — HOME FUNDS W astern Center Reserve, LLC Page 2 Rev. 10-17-13 i All accounts, contract rights, instruments, documents, general intangibles and chattel paper arising from or by virtue of any transactions relating to the Property; All permits, licenses, franchises, certificates, and other rights and privileges obtained in connection with the Property; All proceeds payable or to be payable under each policy of insurance relating to the Property; and All products and proceeds of the foregoing. Notwithstanding any other provision in this Deed of Trust, the term "Property" does not include personal effects used primarily for personal, family, or household purposes. In addition to creating a deed -of -trust lien on the Property described, Grantor also grants to Lender a security interest in all of the above -described personal property pursuant to and to the extent permitted by the Texas Uniform Commercial Code. Prior Liens* The lien created by this Deed of Trust is and shall be subject and subordinate in all respects to the liens, terms, covenants and conditions of the mortgage securing , a Promissory of even date hereof in the original pnncipal sum of $13,171,967.00 made by Giantor and payable to Bank of America, N.A. (the "Senior Indebtedness"), to the extent and in the manner provided in that certain Subordination Agreement of even date hereof between Bank of America, N.A., Grantor and Lender (the ` Subordination Agreement") The rights and remedies of Lender and each subsequent assignee of the lien under this Deed of Trust are subject to the restrictions and limitations set forth in the Subordination Agreement. Subject to waiver, notice, grace and cure period, if any, if default occurs in payment of any part of principal or interest of the Senior Indebtedness more particularly described in the Subordination Agreement or in observance of any covenants of the deeds of trust or other loan documents securing the Senior Indebtedness, the entire debt secured by this Deed of Trust will immediately become payable at the option of Lender to the extent permitted by the Subordination Agreement. Other Exceptions to Conveyance and Warranty: The Permitted Exceptions set forth on Exhibit "B" attached hereto and incorporated herein for all purposes For value received and to secure performance of the Obligations, Grantor conveys the Property to Trustee in trust. Grantor warrants and agrees to defend the title to the Property subject to the Other Exceptions to Conveyance and Warranty. On performance of the Obligations including payment of the Loan and all other amounts secured by this DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 3 Rev. 10-17-13 Deed of Trust and performance of the requirements of the HOME Program, this Deed of Trust will have no further effect, and Lender will release it at Grantor's expense. Clauses and Covenants A. Grantor's Obligations Grantor agrees to- 1. pay all taxes and assessments on the Property before delinquency; 2. defend title to the Property subject to the Other Exceptions to Conveyance and Warranty and preserve the lien's priority as it is established in this Deed of Trust; 3. obey all laws, ordinances, and restrictive covenants applicable to the Property; 4. maintain all insurance coverages with respect to the Property revenues generated by the Property, and operations on the Property that Lender reasonably requires ("Required Insurance Coverages"), issued by insurers and written on policy forms acceptable to Lender and deliver evidence of the Required Insurance Coverages in a form acceptable to Lender at least 10 days before the expiration of the Required Insurance Coverages. 5. obey all laws, ordinances, and restrictive covenants applicable to the Property; 6. if the lien of this Deed of Trust is not a first lien pay or cause to be paid all prior lien notes pursuant to their respective terms and abide by or cause to be abided by all prior lien instruments; and 7. notify Lender in writing of any change of address. Grantor agrees not to- 1. do or permit anything to be done that will impair the security of this Deed of Trust. B. Lender's Rights 1. Lender or Lender's mortgage servicer may appoint in writing a substitute trustee, succeeding to all rights and responsibilities of Trustee. 2. If the proceeds of the Loan are used to pay any debt secured by prior liens, Lender is subrogated to all the rights and liens of the holders of any debt so paid. DEED OF TRUST - HOME FUNDS Western Center Reserve, LLC Page 4 Rev. 10-17-13 3. Notwithstanding the terms of the Note to the contrary, and unless applicable law prohibits, all payments received by Lender from Grantor with respect to the Obligations or this Deed of Trust may, at Lender's discretion, be applied first to amounts payable under this Deed of Trust and then to amounts due and payable to Lender with respect to the Obligations, to be applied to late charges, principal or interest in the order Lender in its discretion determines. 4. If Grantor fails to perform any of Grantor's Obligations under this Deed of Trust, subject to prior written notice and cure period, Lender may perform those obligations and be reimbursed by Grantor on demand for any amounts so paid, including reasonable attorney's fees, plus interest on those amounts from the dates of payment at the rate stated in the Note for matured, unpaid amounts. The amount to be reimbursed will be secured by this Deed of Trust. 5. If there is a default on the Obligations or if Grantor fails to perform any of Grantor s Obligations under this Deed of Trust and the default continues after any required notice of the default and the time allowed to cure, Lender may - a. declare any unpaid principal balance and earned interest on the Obligations immediately due; b. direct Trustee to foreclose this lien, in which case Lender or Lender's agent will cause notice of the foreclosure sale to be given as provided by the Texas Property Code as then in effect; and c. purchase the Property at any foreclosure sale by offering the highest bid and then have the bid credited on the Obligations. Notwithstanding anything to the contrary, if a monetary event of default occurs under the terms of any of the Loan documents, prior to exercising any remedies Lender shall give Grantor and each of the members of Grantor, as identified in the Amended and Restated Operating Agreement dated October 18, 2013, as it may be amended from time to time (the "Operating Agreement '), simultaneous written notice of such default. Grantor and each of the Members on behalf of Grantor shall have a period of 10 days after such notice is given within which to cure the default prior to exercise of remedies by Lender under the Loan documents. Notwithstanding anything to the contrary, if a non -monetary event of default occurs under the terms of any of the Loan documents, prior to exercising any remedies, Lender shall give Grantor and each of the Members of the Grantor, as identified in the Operating Agreement, simultaneous written notice of such default If the default is reasonably capable of being cured within 30 days, Grantor and each of the Members on behalf of Grantor shall have such period to effect a cure prior to exercise of remedies by Lender under the Loan documents. If the default is such that it is not reasonably capable of being cured within 30 days and if Grantor or a Member on behalf of Grantor (a) initiates corrective action withm said period, and (b) diligently, continually, and in good faith woiks DEED OF TRUST - HOME FUNDS Western Center Reserve, LLC Page 5 Rev. 10-17-13 to effect a cure as soon as possible, then Grantor shall have such additional time as is reasonably necessary to cure the default prior to exercise of any remedies by Lender. In no event shall Lender be precluded from exercising remedies if its security becomes or is about to become materially jeopardized by any failure to cure a default or the default is not cured within 180 days after the first notice of default is given. Notices provided by Lender under this Deed of Trust to Grantor's members shall be provided to the followings Managing Member MV Western Center Reserve, LLC 9349 Waterstone Blvd. Cincinnati, OH 45249 Attention: David R. Liette With copy to: Locke Lord LLP 600 Congress Ave, Ste 2200 Austin, TX 78701 Attention: Cynthia Bast, Esq. Investor Member Bank of America, N.A c/o Bank of America Merrill Lynch Tax Ciedit Equity Investment Asset Management NC1-007-11-25 100 North Tryon Street Charlotte, NC 28202 Attention: Nicole Baldon, Vice President With copy to: Banc of America CDC Special Holding Company, Inc. c/o Bank of America Merrill Lynch Tax Credit Equity Investment Asset Management NC 1-007-11-25 100 North Tryon Street Charlotte, NC 28202 Attention: Nicole Baldon, Vice President With copy to: Sidley and Austin, LLP One South Dearborn Street, Chicago IL 60603 Attention:m David R. Hill, Esq. Notices given to Grantor's Members shall be in writing and delivered to the addresses listed above, or to such other address as they designate by written notice to DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 6 Rev. 10-17-13 i Lender Each such notice or other communication shall be effective on the date of receipt when sent by U. S. Mail, postage prepaid, by certified mail, return receipt requested or by a nationally recognized overnight delivery service. 6. Lender may remedy any default without waiving it and may waive any default without waiving any prior or subsequent default. C. Trustee's Rights and Duties If directed by Lender to foreclose this lien, Trustee will- 1. either personally or by agent give notice of the foreclosure sale as required by the Texas Property Code as then in effect; 2. sell and convey all or part of the Property "AS IS" to the highest bidder for cash with a general warranty binding Grantor, subject to the Prior Lien and to the Other Exceptions to Conveyance and Warranty and without representation or warranty, express or implied, by Trustee; 3. from the proceeds of the sale, pay, in this order - a. expenses of foreclosure, including a reasonable commission to Trustee; b. to Lender, the full amount of principal interest, reasonable attorney s fees, and other charges due and unpaid c. any amounts required by law to be paid before payment to Grantor; and d. to Grantor, any balance; and 4. be indemnified, held harmless, and defended by Lender against all costs, expenses, and liabilities incurred by Trustee for acting in the execution or enforcement of the trust created by this Deed of Trust, which includes all court and other costs, including reasonable attorney's fees, incurred by Trustee in defense of any action or proceeding taken against Trustee in that capacity. D. General Provisions 1. If any of the Property is sold under this Deed of Trust, Grantor must immediately surrender possession to the purchaser. If Grantor fails to do so, Grantor will become a tenant at sufferance of the purchaser, subject to an action for forcible detainer. 2. Recitals in any trustee's deed conveying the Property will be presumed to be true, absent evidence to the contrary. DEED OF TRUST - HOME FUNDS Western Center Reserve, LLC Page 7 Rev. 10-17-13 3. Proceeding under this Deed of Trust, filing suit for foreclosure, or pursuing any other remedy will not constitute an election of remedies. 4. This lien will remain superior to liens later created even if the time of payment of all or part of the Obligations is extended or part of the Property is released, unless a subordination agreement is executed by the Lender. 5. If any portion of the Obligations cannot be lawfully secured by this Deed of Trust, payments will be applied first to discharge that portion. 6. Subject to the rights of senior lien holders, Grantor assigns to Lender all amounts payable to or received by Grantor from condemnation of all or part of the Property, from private sale in lieu of condemnation and from damages caused by public works or construction on or near the Property After deducting any expenses incurred, including reasonable attorney's fees and court and other costs, Lender will either release any remaining amounts to Grantor or apply such amounts to reduce the Obligations and any excess proceeds shall be paid to Grantor. Lender will not be liable for failure to collect or to exercise diligence in collecting any such amounts. Grantor will immediately give Lender notice of any actual or known threatened proceedings for condemnation of all or part of the Property. Notwithstanding the above, in the event of any fire or other casualty to the Property or eminent domain proceedings resulting in condemnation of the Property or any part thereof, Grantor shall have the right to rebuild the Property, and to use all available insurance or condemnation proceeds therefore, provided that (a) such proceeds are sufficient to keep the Obligations in balance and rebuild the Property in a manner that provides adequate security to Lender for repayment or performance of the Obligations or if such proceeds are insufficient then Grantor shall have funded any deficiency, (b) subject to the rights of senior lien holders, Lender shall have the right to approve plans and specifications for any major rebuilding and the right to approve disbursements of insurance or condemnation proceeds for iebuildmg under a construction escrow or similar arrangement, and (c) no material default then exists under the Loan documents other than attributable to casualty or condemnation If the casualty or condemnation affects only part of the Property and total rebuilding is infeasible, then proceeds may be used for partial rebuilding and partial repayment of the Obligations in a manner that provides adequate security to Lender for repayment of the remaining balance of the Obligations, and any excess proceeds shall be paid to Grantor. 7. Subject to the rights of senior lien holders, Grantor assigns to Lender absolutely, not only as collateral, all present and future rent and other income and receipts fiom the Property. Grantor may as Lender's licensee collect rent and other income and receipts as long as Grantor is not in default with respect to the Obligation or this Deed of Trust. Subject to the terms of the Loan documents, Grantor will apply all rent and other income and receipts to payment of the Obligations and performance of this Deed of Trust, but if the rent and other income and receipts exceed the amount due with respect to DEED OF TRUST - HOME FUNDS Western Center Reserve, LLC Page 8 Rev. 10-17-13 the Obligations and the Deed of Trust, Grantor may retain the excess If Grantor defaults in payment or performance of the Obligations or performance of this Deed of Trust, subject to the rights of senior hen holders, Lender may terminate Grantor's license to collect rent and other income and then as Grantor's agent may rent the Property and collect all rent and other income and receipts Lender neither has nor assumes any obligations as lessor or landlord with respect to any occupant of the Property Lender may exercise Lender's rights and remedies under this paragraph without taking possession of the Property. Lender will apply all rent and other income and receipts collected under this paragraph first to expenses incurred in exercising Lender's rights and remedies and then to Grantor's obligations with respect to the Obligations and this Deed of Trust in the order determined by Lender Lender is not required to act under this paragraph, and acting under this paragraph does not waive any of Lender's other rights or remedies. 8. Interest on the debt secured by this Deed of Trust will not exceed the maximum amount of non -usurious interest that may be contracted for, taken, reserved, charged, or received under law. Any interest in excess of that maximum amount will be credited on the principal of the debt or, if that has been paid, refunded. On any acceleration or required or permitted prepayment, any excess interest will be canceled automatically as of the acceleration or prepayment or, if already paid, credited on the principal of the debt or, if the principal of the debt has been paid, refunded. This provision overrides any conflicting provisions in this and all other instruments concerning the debt. 9. In no event may this Deed of Trust secure payment of any debt that may not lawfully be secured by a lien on real estate or create a lien otherwise prohibited by law. 10. When the context requires, singular nouns and pronouns include the plural. 11. The term Note includes all extensions, modifications, and renewals of the Note and all amounts secured by this Deed of Trust. 12. Grantor agrees to (a) keep at Grantor's address, or such other place as Lender may approve, accounts and records reflecting the operation of the Property and copies of all written contracts, leases, and other instruments that affect the Property; (b) prepare financial accounting records in compliance with generally accepted accounting principles consistently applied; and (c), at Lender's request on reasonable notice from time to time, permit Lender to examine and make copies of such books, records, contracts, leases, and other instruments at any reasonable time. 13. Grantor agrees to deliver to Lender, at Lender's request from time to time, internally prepared financial statements of Grantor and any guarantor of the Note prepared in accordance with generally accepted accounting principles consistently DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 9 Rev. 10-17-13 applied, in detail reasonably satisfactory to Lender and certified to be materially true and correct by the chief financial officer of Grantor or its certified public accountant, as applicable. 14. If Lender orders an appraisal of the Property while a default exists or to comply with legal requirements affecting Lender, Grantor, at Lender's request, agrees to reimburse Lender for the reasonable cost of any such appraisal. If Grantor fails to reimburse Lender for any such appraisal within 20 days of Lender's written request, that failure is a default under this Deed of Trust. 15. Grantor agrees to allow Lender or Lender's agents to enter the Property during regular business hours upon at least 48 hours prior notice and inspect it and any personal property in which Lender is granted a security interest by this Deed of Trust. 16. Grantor may not sell, transfer, or otherwise dispose of any Property, whether voluntarily or by operation of law, except for condemnation or to obtain utility easements, without the prior written consent of Lender. If granted, consent may be conditioned upon (a) the grantee's integrity, reputation character, creditworthiness, and management ability being satisfactory to Lender; and (b) the grantee's executing, before such sale, transfer, or other disposition, a written assumption agreement containing any terms Lender may reasonably require, such as a principal pay down on the Obligations, an increase in the rate of interest payable with respect to the Obligations, a transfer fee, or any other modification of the Note, this Deed of Trust , or any other instruments evidencing or securing the Obligations. Grantor may not cause or permit any Property to be encumbered by any liens, security interests, or encumbrances other than the hens securing the Obligation and the liens securing ad valorem taxes not yet due and payable and the Permitted Exceptions without the prior written consent of Lender If granted, consent may be conditioned upon Grantor's executing, before granting such lien, a written modification agreement containing any terms Lender may require, such as a principal pay down on the Obligations, an increase in the rate of interest payable with respect to the Obligations, an approval fee, or any other modification of the Note, this Deed of Trust, or any other instruments evidencing or securing the Obligations. Grantor may not grant any lien, security interest, or other encumbrance (a 'Subordinate Instrument') covering the Property that is subordinate to the liens created by this Deed of Trust without the prior written consent of Lender other than the Declaration of Land Use Restrictive Covenants ("LURA") which will be executed by Grantor on the form required by the Texas Department of Housing and Community Affairs ("TDHCA"), which is hereby approved, and such approval of the LURA shall be reflected by Lender's execution of the form of Consent and Subordination of Lienholder which is required by the TDHCA Lender acknowledges and agrees that, in the event of a foreclosure of its interest under this Deed of Trust, the following rule contained DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 10 Rev. 10-17-13 i in Section 42(h)(6)(E)(ii) of the Internal Revenue Code of 1986 (the "Code") shall apply: For a period of 3 years from the date of foreclosure, with respect to any unit that had been regulated by the LURA, (i) none of the eligible tenants occupying those units at the time of foreclosure may be evicted or their tenancy terminated (other than for good cause), (ii) nor may any rent be increased except as otherwise permitted under Section 42 of the Code. If granted, consent for loans and documents other than the LURA may be conditioned upon the Subordinate Instrument s containing express covenants to the effect that - a. the Subordinate Instrument is unconditionally subordinate to this Deed of Trust; b. if any action is instituted to foreclose or otherwise enforce the Subordinate Instrument, no action may be taken that would terminate any occupancy or tenancy without the prior written consent of Lender, and that consent, if granted, may be conditioned in any manner Lender deteiniines; c. rents, if collected by or for the holder of the Subordinate Instrument, will be applied first to the payment of the Obligations then due and to expenses incurred in the ownership, operation, and maintenance of the Property in any order Lender may determine, before being applied to any indebtedness secured by the Subordinate Instrument; d. written notice of default under the Subordinate Instrument and written notice of the commencement of any action to foreclose or otherwise enforce the Subordinate Instrument must be given to Lender concurrently with or immediately after the occurrence of any such default or commencement; and e. in the event of the bankruptcy of Grantor, all amounts due on or with respect to the Obligations and this Deed of Trust will be payable in full before any payments on the indebtedness secured by the Subordinate Instrument. Grantor may not cause or permit any of the following events to occur without the prior written consent of Lender: if Grantor is (a) a corporation, the dissolution of the corporation or the sale, pledge, encumbrance, or assignment of any shares of its stock; (b) a limited liability company, the dissolution of the company or the sale, pledge, encumbrance, or assignment of any of its membership interests, other than an assignment to a senior lien holder or to the Investor Member, (c) a general partnership or joint venture, the dissolution of the partnership or venture or the sale, pledge, encumbrance, or DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 11 Rev. 10-17-13 i assignment of any of its partnership or joint venture interests, or the withdrawal from or admission into it of any general partner or joint venturer; or (d) a limited partnership, (1) the dissolution of the partnership (2) the sale, pledge, encumbrance, or assignment of any of its general partnership interests, or the withdrawal from or admission into it of any general partner, or (3) except for a limited partnership interest in a low income housing project, the withdrawal from or admission into it of any controlling limited partner or partners. If granted, consent may be conditioned upon (a) the integrity, reputation, character creditworthiness and management ability of the person succeeding to the ownership interest in Grantor (or security interest in such ownership) being reasonably satisfactory to Lender; and (b) the execution, before such event, by the person succeeding to the interest of Grantor in the Property or ownership interest in Giantor (or security interest in such ownership) of a written modification or assumption agreement containing such terms as Lender may reasonably require, such as a principal pay down on the Obligations, an increase in the rate of interest payable with respect to the Obligations, a transfer fee, or any other modification of the Note, this Deed of Trust, or any other instruments evidencing or securing the Obligations. Notwithstanding anything to the contrary herein, neither the withdrawal, removal, replacement, and/or addition of a Member of the Grantor pursuant to the terms of the Operating Agreement, or the assignment of membership interests securing the Senior Indebtedness nor the withdrawal, replacement, and/or addition of any of Grantor's Investor Membei or its Investor Member's general partners or members, shall constitute a default under any of the Loan documents, and any such actions shall not accelerate the maturity of the Loan, provided that any required substitute Grantor's Member is reasonably acceptable to Lender and is selected with reasonable promptness. Any substitute Member that is an affiliate of Grantor's Investor Member or the holder of the Senior Indebtedness is hereby deemed acceptable to Lender. Further none of the actions described in this paragraph will constitute a material change in ownership which would trigger termination of the Contract as hereinafter defined. 17. Grantor agrees not to grant any future lien or security interest in the Property or to permit any future junior encumbrance to be recorded or any existing or future claim to otherwise become an encumbrance against the Property other than the proposed LURA which will be executed by Grantor on the form required by the TDHCA, which is hereby approved If an involuntary encumbrance is filed against the Property, Grantor agrees, within 30 days of actual notice, to either remove the involuntary encumbrance or insure against it or provide a bond acceptable to Lender against the involuntary encumbrance. 18. This Deed of Trust binds, benefits, and may be enforced by the successors in interest of all parties. 19. If Grantor and Borrower are not the same person, the term Grantor includes Borrower. DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 12 Rev. 10-17-13 20. Except as may be specifically stated in this Deed of Trust or the Note, Grantor and each surety, endorser, and guarantor of the Obligations waive all demand for payment, presentation for payment, notice of intention to accelerate maturity, notice of acceleration of maturity, protest, and notice of protest, to the extent permitted by law. 21. Grantor agrees to pay reasonable attorney's fees, trustee s fees, and court and other costs of enforcing Lender's rights under this Deed of Trust if this Deed of Trust is placed in the hands of an attorney for enforcement. 22. If any provision of this Deed of Trust is determined to be invalid or unenforceable, the validity or enforceability of any other provision will not be affected. 23. The term Lender includes any mortgage servicer for Lender. 24. The debt and the performance secured by this Deed of Trust is a nonrecourse obligation of Borrower. Neither Borrower nor any of its Members nor any other party shall have any personal liability for repayment of the Loan described in the Contract. The sole recourse of Lender under the Loan documents for repayment of the Loan or performance of any of the Obligations shall be the exercise of its right against the security for payment as defined in the Note. E. Construction Loan Mortgage 1. This Deed of Trust is a "construction mortgage" within the meaning of Section 9.334 of the Texas Business and Commerce Code. The liens and security interests created and granted by this Deed of Trust secure an obligation incurred for the construction or rehabilitation of improvements on land. 2. Grantor agrees to comply with the terms, covenants and conditions of City Secretary Contract No. 43273 between Grantor and Lender (the "Contract") which requires the Note and this Deed of Trust. All advances made by Lender under the Contract will be indebtedness of Grantor secured by the liens created by this Deed of Trust, and such advances are conditioned as provided in the Contract. 3. All amounts disbursed by Lender before completion of the improvements to protect the security of this Deed of Trust up to the principal amount of the Note will be treated as disbursements under the Contract All such amounts will bear interest from the date of disbursement at the rate stated in the Note, unless collections from Grantor of interest at that rate would be contrary to applicable law, in which event such amounts will bear interest at the rate stated in the Note for matured, unpaid amounts and will be payable on notice from Lender to Grantor requesting payment. 4. From time to time as Lender deems reasonably necessary to protect Lender's interests, Grantor will, on request of Lender, execute and deliver to Lender, in such form as Lender directs but subject to the rights of any senior lien holders, DEED OF TRUST - HOME FUNDS Western Center Reserve, LLC Page 13 Rev. 10-17-13 i assignments of any and all rights or claims that relate to the construction of improvements on the Property. 5. In case of breach by Grantor of the terms, covenants and conditions of the Contract, Lender, at its option, subject to applicable notice, grace and cure periods with or without entry on the Property, may (a) invoke any of the rights or remedies provided in the Contract, (b) accelerate the amounts secured by this Deed of Trust and invoke the remedies provided in this Deed of Trust, or (c) do both. F THIS CONVEYANCE IS MADE AND ACCEPTED SUBJECT TO THE FOLLOWING CONDITIONS AND RESTRICTIONS: The Note secured by this Deed of Trust is the Note required in the Contract between Grantor and Lender and has been executed and delivered in accordance with its terms. The funds advanced by Lender are HOME funds and the Contract requires that the 4 residential rental units located on the Property assisted with HOME Funds (the "HOME Units") must qualify and remain affordable rental housing in accordance with the HOME Program and the HOME Regulations for the 20 year Affordability Period more particularly defined in the Contract. The Obligations described in the Contract evidenced by the Note and secured by this Deed of Trust will be in default if the HOME Units more particularly described in the Contract do not remain affordable rental housing for the duration of the Affordability Period, subject to the next available unit rule. This Deed of Trust has also been executed and delivered pursuant to the terms of the Contract. Grantor agrees to perform each and every obligation set forth therein and will not permit a default to occur thereunder. Any default in the performance of Grantor's obligations under the terms of the Contract or the HOME Program or HOME Regulations shall be deemed a default in the terms of the Note and Lender may invoke any remedies provided herein for default. DEED OF TRUST - HOME FUNDS Western Center Reserve, LLC Page 14 Rev. 10-17-13 THE CONTRACT, THE NOTE AND THE DEED OF TRUST CONSTITUTE THE FINAL AGREEMENT OF THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. WESTERN CENTER RESERVE, LLC, a Texas limited liability company By: MV Western Center Reserve, LLC, an Ohio limited liability company Its: Managing Member B y: Name: Its: B y: Name: Its: AFTER RECORDING RETURN TO: City of Fort Worth City Attorney's Office Attention: Vicki S. Ganske 1000 Throckmorton Street Fort Worth, Texas 76102 DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC By: MV Affordable Housing LLC, an Ohio limited liability company, Its: Sole Member Authorized Signer Authorized Signer Page 15 Rev. 10-17-13 STATE OF OHIO COUNTY OF WARREN § Before me, the undersigned authority, on this day personally appeared , known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he/she executed the same for the purposes and consideration therein expressed. Given under my hand and seal this day of . 20 [Seal] Notary Public Notary's Name (Printed): My commission expires• STATE OF OHIO COUNTY OF WARREN § § Before me, the undersigned authority on this day personally appeared , known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he/she executed the same for the purposes and consideration therein expressed. Given under my hand and seal this day of [Seal] Notary Public Notary's Name (Printed): My commission expires: DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC , 20_ Page 16 Rev. 10-17-13 1 DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 17 Rev. 10-17-13 Exhibit "A" Legal Description Lot 1 Block 1, Reserve at Western Center, an Addition to the City of Fort Worth, Tarrant County, Texas, according to the plat thereof recorded under Clerk's File No. D213268904, Official Public Records, Tarrant County, Texas DEED OF TRUST - HOME FUNDS Western Center Reserve, LLC Page 18 Rev. 10-17-13 Exhibit "B" Permitted Encumbrances 1. Declaration of Land Use Restrictive Covenants by and between Western Center Reserve, LLC, a Texas limited liability company, Texas Department of Housing and Community Affairs, a public and official agency of the State of Texas, and Bank of America, N.A. to be recorded in the Real Property Records of Tarrant County, Texas. 2. All deeds of trust, mortgages and other loan documents securing the Promissory Note to Bank of America, N.A. 3. The Subordination Agreement. 4. Rights of tenants in possession, as tenants only, under any unrecorded leases or rental agreements. 5. The following restrictive covenants of record: Clerk's File No. D213268904, Official Public Records, Tarrant County, Texas. 6. Any discrepancies, conflicts, or shortages in area or boundary lines, or any encroachments or protrusions, or any overlapping of improvements. 7 Any titles or rights asserted by anyone including, but not limited to, persons, the public, corporations, governments or other entities. 8. Standby fees, taxes and assessments by any taxing authority for the year 2014, and subsequentyears; and subsequent taxes and assessments by any taxing authority for prior years due to change in land usage or ownership, but not those taxes or assessments for prior years because of an exemption granted to a previous owner of the property under Section 11.13, Texas Tax Code, or because of improvements not assessed for a previous tax year. 9. Liens and leases that affect the title to the land, but that are subordinate to the lien of the insured mortgage. 10. Any portion of the property described herein within the limits or boundaries of any public or private roadway and/or highway, including, but not limited to, that portion of the subject property lying within the boundary of . 11. All, leases, grants, exceptions or reservations of coal, lignite, oil, gas and other minerals, together with all rights, privileges, and immunities relating thereto, appearing in the Public Records of Tarrant County. DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 19 Rev. 10-17-13 12. The following matters and all terms of documents creating or offering evidence of the matters: a. Interest in and to oil, gas and other minerals and/or royalties, bonuses, rentals and all other rights relating thereto as set forth in the document: Recording No.: Volume 1456, Page 182, Deed Records, Tarrant County, Texas b. Interest in and to oil, gas and other minerals and/or royalties, bonuses, rentals and all other rights relating thereto as set forth in the document: Recording No.: Volume 3469, Page 540, Deed Records, Tarrant County, Texas c Easement(s) for the purpose(s) shown below and rights incidental thereto as set forth in a document In favor of: Greenway-Western Center, L P Recording Date: June 8, 2004 Recording No: Clerk's File No. D204175425, Deed Records, Tarrant County, Texas, as shown on survey prepared by Brian E. Wilson, Registered Professional Land Surveyor No. 5745, dated October 7, 2013, last revised October 16, 2013. d. Oil, Gas and Mineral Lease, together with all rights incident thereto. Lessee: Four Sevens Oil Co., Ltd Dated: May 26, 2004 Recording No.: Clerk's File No. D204245241, Deed Records, Tarrant County, Texas e. Oil, Gas and Mineral Lease, together with all rights incident thereto. Lessee: Chesapeake Exploration, L.L.C. Dated: March 15, 2010 Recording No.: Clerk's File No. D210074598, Deed Records, Tarrant County, Texas g. Rights of any and all parties to ditches, as shown on survey prepared by Brian E Wilson, Registered Professional Land Surveyor No. 5745, dated October 7, 2013, last revised October 16, 2013. h. Encroachment/Protrusion of fence, as shown on survey prepared by Brian E DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 20 Rev. 10-17-13 Wilson, Registered Professional Land Surveyor No. 5745, dated October 7, 2013, last revised October 16, 2013. i. The following matters set forth on plat recorded under Clerk's File No. D213268904, Official Public Records, Tarrant County, Texas: 1. 10' x 35' water easement; 2. Variable width emergency access easements; 3. 15' sanitary sewer easement; 4. 15' private storm sewer easement 5. 5 utility easement; 6. Flood plain easement; 7. 25' building lines* and 8. 10' x 10 public open space easements. DEED OF TRUST — HOME FUNDS Western Center Reserve, LLC Page 21 Rev. 10-17-13 EXHIBIT "F" REIMBURSEMENT FORMS WESTERN CENTER RESERVE, LLC HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 INVOICE Agency: Western Center Reserve, LLC Address: City, State, Zip: Project: Reserve at Western Center Period of Service: Program Amount This Invoice Cumulative to Date Attachment I Contractor's Certification: I certify that the costs incurred are valid and consistent with the terms and conditions of the contract between City and Agency. By signing this invoice, I certify that to the best of my knowledge and belief the data included in this report is true and accurate. It is acknowledged that the provision of false information could leave the certifying official subject to the penalties of federal, state and local law. Signature and Date: Name: Title: HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 Attachment II Line No. Date 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Total City of Fort Worth Housing and Economic Development Department Expenditure Worksheet Developer: Project: Western Center Reserve LLC Reserve at Western Center Check No. Payee or Beneficiary* Description* Amount *Payroll must identify employee. Rent must identify tenant. Other payments should identify individuals, if applicable. HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 EXHIBIT "G" PROJECT COMPLIANCE REPORT: RENTAL HOUSING WESTERN CENTER RESERVE, LLC HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 PROJECT COMPLIANCE REPORT: RENTAL HOUSING EXHIBIT "G" Project Name: Contract #: Owner Name: Reporting Period: From To # of HOME -Assisted Units: # of High HOME Units Required: # of Low HOME Units Required: *All data reported should be consistent with requirements described in contract and any amendments Lease date Unit Number Low or High HOME Rent Unit? Tenant Name # of Date of Last Unit Tenant's % of Persons Income Utility Monthly Annual Median in HH # of BRs Certification Max Rent Allowance Rent Gross Income Type of Househo d Other Assistance Type Race Select: Select: Select: 1 Single, noneldedy 1 Section 8 1 White 2 Elderly 2 HOME TBRA 2 Black/ African American 3 single 3 Other federal, state, 3 Asian 4 Two parents or local assistance 4 American Indian/Alaskan Native 5 Other 4 No assistance 5 Native Hawaiian/Other Pacific Islander Low HOME rents may not exceed 30% of the adjusted income of households at 50% of area median income, adjusted for household size and adjusted for tenant -paid utilities. Additionally, low HOME rents may not exceed the High HOME standard (which may be capped by the FMR). At lease 20% of HOME units in projects with 5 or more HOME -assisted units must have low HOME rents. High HOME rents apply to all other HOME-assited units and are calculated as the lesser of the Section 8 (Choice Voucher) Fair Market Rent or 30% of adjusted monthly income for households at 65% are median income, adjusted for household size, and adjusted for tenant -paid utilities. Both sets of rents are published by HUD, and both limit the local contract rent, including rental assistance, except for project -based assistance for the Low HOME rent units. 6 American Indian/Alaskan Native & White 7 Asian & White 8 Black & White 9 American Indian/Alaskan Native & Black 10 Other Certification: The undersigned, hereby, gives assurance that to the best of my knowledge and belief, the data included in this report is true and accurate, and if is a non-profit agency, has been approved by the governing body of the organization prior to submission. This completed and signed document should be submitted to the City annually per your contract. A copy should be retained in your files. Title: Print Name: Signature: Date: Phone No.: Hispanic? Race Other Assistance Type of Type household EXHIBIT "H" FEDERAL LABOR STANDARD PROVISIONS - DAVIS-BACON REQUIREMENTS WESTERN CENTER RESERVE, LLC NOT APPLICABLE HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC -- Reserve at Western Center Rev. 10-17-13 Exhibit "H" Federal Labor Standards Provisions Applicability The Project or Program to which the construction work covered by this contract pertains is being assisted by the United States of America and the following Federal Labor Standards Provisions are included in this Contract pursuant to the provisions applicable to such Federal assistance. A. 1. (I) Minimum Wages. All laborers and mechanics e mployed or working upon the site of the work, will be paid u nconditionally and not less often than once a week, and without subsequent deduction or rebate on any account (except such payroll deductions as are permitted by regulations issued by the Secretary of Labor under the Copeland Act (29 CFR Part 3), the full amount of wages and bona fide fringe benefits (or cash equivalents thereof) due at time of payment computed at rates not less than those contained in the wage determination of the Secretary of Labor which is attached hereto and made a part hereof, regardless of any contractual relationship which may be alleged to exist between the contractor and such laborers and mechanics. Contributions made or costs reasonably anticipated for bona fide fringe benefits u nder Section 1(b)(2) of the Davis -Bacon Act on behalf of laborers or mechanics are considered wages paid to such laborers or mechanics, subject to the provisions of 29 CFR 5.5(a)(1)(iv); also, regular contributions made or costs incurred for more than a weekly period (but not less often than quarterly) under plans, funds, or programs, which cover the particular weekly period, are deemed to be constructively made or incurred during such weekly period. Such laborers and mechanics shall be paid the appropriate wage rate and fringe benefits on the wage determination for the classification of work actually performed, without regard to skill, except as provided in 29 CFR 5.5(a)(4). Laborers or mechanics performing work in more than one classification may be compensated at the rate specified for e ach classification for the time actually worked therein: Provided, That the employer's payroll records accurately set forth the time spent in each classification in which work is performed. The wage determination (including any additional classification and wage rates conformed under 29 CFR 5.5(a)(1)(ii) and the Davis -Bacon poster (WH- 1321) shall be posted at all times by the contractor and its subcontractors at the site of the work in a prominent and accessible, place where it can be easily seen by the workers. (II) (a) Any class of laborers or mechanics which is not listed in the wage determination and which is to be e mployed under the contract shall be classified in conformance with the wage determination. HUD shall approve an additional classification and wage rate and fringe benefits therefor only when the following criteria have been met: Previous editions are obsolete U.S. Department of Housing and Urban Development Office of Labor Relations (1) The work to be performed by the classification requested is not performed by a classification In the wage determination; and (2) The classification is utilized in the area by the construction industry; and (3) The proposed wage rate, including any bona fide fringe benefits, bears a reasonable relationship to the wage rates contained in the wage determination. (b) If the contractor and the laborers and mechanics to be e mployed in the classification (if known), or their representatives, and HUD or its designee agree on the classification and wage rate (including the amount designated for fringe benefits where appropriate), a report o f the action taken shall be sent by HUD or its designee to the Administrator of the Wage and Hour Division, Employment Standards Administration, U.S. Department of Labor, Washington, D.C. 20210. The Administrator, or an authorized representative, will approve, modify, or disapprove every additional classification action within 30 days of receipt and so advise HUD or its designee or will n otify HUD or its designee within the 30-day period that additional time is necessary. (Approved by the Office of Management and Budget under OMB control number 1215- 0140.) (c) In the event the contractor, the laborers or mechanics to be employed in the classification or their representatives, and HUD or its designee do not agree on the proposed classification and wage rate (including the amount designated for fringe benefits, where appropriate), HUD or its designee shall refer the questions, including the views of all interested parties and the recommendation of HUD or its designee, to the Administrator for determination. The Administrator, or an authorized representative, will issue a determination within 30 days of receipt and so advise HUD or its designee or will notify HUD or its designee within the 30-day period that additional time is necessary. (Approved by the Office of Management and Budget under OMB Control Number 1215-0140.) (d) The wage rate (including fringe benefits where appropriate) determined pursuant to subparagraphs (1)(ii)(b) or (c) of this paragraph, shall be paid to all workers performing work in the classification under this contract from the first day on which work is performed in the classification. (ill) Whenever the minimum wage rate prescribed in the contract for a class of laborers or mechanics includes a fringe benefit which is not expressed as an hourly rate, the contractor shall either pay the benefit as stated in the wage determination or shall pay another bona fide fringe benefit or an hourly cash equivalent thereof. (Iv) If the contractor does not make payments to a trustee or other third person, the contractor may consider as part form HUD-4010 (06/2009) Page 1 of 5 ref. Handbook 1344.1 o f the wages of any taborer or mechanic the amount of any costs reasonably anticipated in providing bona fide fringe benefits under a plan or program, Provided, That the Secretary of Labor has found, upon the written request of the contractor, that the applicable standards of the Davis - Bacon Act have been met. The Secretary of Labor may require the contractor to set aside in a separate account assets for the meeting of obligations under the plan or program. (Approved by the Office of Management and Budget under OMB Control Number 1215-0140.) 2. Withholding. HUD or its designee shall upon its own action or upon written request of an authorized representative of the Department of Labor withhold or cause to be withheld from the contractor under this contract or any other Federal contract with the same prime contractor, or any other Federally -assisted contract subject to Davis -Bacon prevailing wage requirements, w hich is held by the same prime contractor so much of the accrued payments or advances as may be considered n ecessary to pay laborers and mechanics, including apprentices, trainees and helpers, employed by the contractor or any subcontractor the full amount of wages required by the contract In the event of failure to pay any laborer or mechanic, including any apprentice, trainee or helper, employed or working on the site of the work, all or part of the wages required by the contract, HUD or its designee may, after written notice to the contractor, sponsor, applicant, or owner, take such action as may be n ecessary to cause the suspension of any further payment, advance, or guarantee of funds until such violations have ceased. HUD or its designee may, after written notice to the contractor, disburse such amounts withheld for and on account of the contractor or subcontractor to the respective employees to whom they are due. The Comptroller General shall make such disbursements in the case of direct Davis -Bacon Act contracts. 3. (I) Payrolls and basic records. Payrolls and basic records relating thereto shall be maintained by the contractor during the course of the work preserved for a period of three years thereafter for all laborers and mechanics working at the site of the work. Such records shall contain the name, address, and social security n umber of each such worker, his or her correct classification, hourly rates of wages paid (including rates o f contributions or costs anticipated for bona fide fringe benefits or cash equivalents thereof of the types described in Section 1(b)(2)(B) of the Davis -bacon Act), daily and weekly number of hours worked, deductions made and actual wages paid. Whenever the Secretary of Labor has found under 29 CFR 5.5 (a)(1)(iv) that the wages of any laborer or mechanic include the amount of any costs reasonably anticipated in providing benefits under a plan o r program described in Section I(b)(2)(B) of the Davis - Bacon Act, the contractor shall maintain records which show that the commitment to provide such benefits is e nforceable, that the plan or program is financially responsible, and that the plan or program has been Previous editions are obsolete communicated in writing to the laborers or mechanics affected, and records which show the costs anticipated or the actual cost incurred in providing such benefits. Contractors employing apprentices or trainees under approved programs shall maintain written evidence of the registration of apprenticeship programs and certification of trainee programs, the registration of the apprentices and trainees, and the ratios and wage rates prescribed in the applicable programs. (Approved by the Office of Management and Budget under OMB Control Numbers 1215-0140 and 1215-0017) (II) (a} The contractor shall submit weekly for each week in which any contract work is performed a copy of all payrolls to HUD or its designee if the agency is a party to the contract, but if the agency is not such a party, the contractor will submit the payrolls to the applicant sponsor, or owner, as the case may be, for transmission to HUD or its designee. The payrolls submitted shall set out accurately and completely all of the information required to be maintained under 29 CFR 5.5(a)(3)(i) except that full social security numbers and home addresses shall not be included on weekly transmittals. Instead the payrolls shall o nly need to include an Individually identifying number for e ach employee (e.g., the last four digits of the employee's social security number). The required weekly payroll information may be submitted in any form desired. Optional Form WH-347 is available for this purpose from the Wage and Hour Division Web site at htto://www.dal.ctov/esalwhd/forms/wh3471nstr.htm or its successor site. The prime contractor is responsible for the submission of copies of payrolls by all subcontractors. Contractors and subcontractors shall maintain the full social security number and current address of each covered worker, and shall provide them upon request to HUD or its designee if the agency is a party to the contract, but if the agency is not such a party, the contractor will submit the payrolls to the applicant sponsor, or owner, as the case may be, for transmission to HUD or its designee, the contractor, or the Wage and Hour Division of the Department of Labor for purposes of an investigation or audit of compliance with prevailing wage requirements. It is not a violation of this subparagraph for a prime contractor to require a subcontractor to provide addresses and social security numbers to the prime contractor for its own records, without weekly submission to HUD or its designee. (Approved by the Office of Management and Budget under OMB Control Number 1215-0149.) (b) Each payroll submitted shall be accompanied by a "Statement of Compliance," signed by the contractor or subcontractor or his or her agent who pays or supervises the payment of the persons employed under the contract and shall certify the following: (1) That the payroll for the payroll period contains the information required to be provided under 29 CFR 5.5 (a)(3)(ii), the appropriate information is being maintained under 29 CFR 5.5(a)(3)(i), and that such information is correct and complete; form HUD-4010 (06/2009) Page 2 of 5 ref. Handbook 1344.1 (2) That each laborer or mechanic (including each helper, apprentice, and trainee) employed on the contract during the payroll period has been paid the full weekly wages earned, without rebate, either directly or indirectly, and that no deductions have been made either directly or indirectly from the full wages earned, other than permissible deductions as set forth in 29 CFR Part 3; (3) That each laborer or mechanic has been paid not less than the applicable wage rates and fringe benefits or cash equivalents for the classification of work performed, as specified in the applicable wage determination incorporated into the contract. (c) The weekly submission of a properly executed certification set forth on the reverse side of Optional Form WH-347 shall satisfy the requirement for submission of the "Statement of Compliance" required by subparagraph A.3.(ii)(b). (d) The falsification of any of the above certifications may subject the contractor or subcontractor to civil or criminal prosecution under Section 1001 of Title 18 and Section 231 of Title 31 of the United States Code. (ID) The contractor or subcontractor shall make the records required under subparagraph A.3.(i) available for inspection, copying, or transcription by authorized representatives of HUD or its designee or the Department o f Labor, and shall permit such representatives to interview employees during working hours on the job. if the contractor or subcontractor fails to submit the required records or to make them available, HUD or its designee may, after written notice to the contractor, sponsor, applicant or owner, take such action as may be necessary to cause the suspension of any further payment, advance, o r guarantee of funds. Furthermore, failure to submit the required records upon request or to make such records available may be grounds for debarment action pursuant to 29 CFR 5.12. 4. Apprentices and Trainees. (1) Apprentices. Apprentices will be permitted to work at less than the predetermined rate for the work they performed when they are employed pursuant to and individually registered in a bona fide apprenticeship program registered with the U.S. Department of Labor, Employment and Training Administration, Office of Apprenticeship Training, Employer and Labor Services, or with a State Apprenticeship Agency recognized by the Office, or if a person is employed in his or her first 90 days of probationary employment as an apprentice in such an apprenticeship program, who is not individually registered in the program, but who has been certified by the Office of Apprenticeship Training, Employer and Labor Services or a State Apprenticeship Agency (where appropriate) to be eligible for probationary employment as an apprentice. The allowable ratio of apprentices to journeymen on the job site in any craft classification shall not be greater than the ratio permitted to the contractor as to the entire work force under the registered program. Any worker listed on a payroll at an apprentice wage rate, who Previous editions are obsolete is not registered or otherwise employed as stated above, shall be paid not less than the applicable wage rate on the wage determination for the classification of work actually performed. In addition, any apprentice performing work on the job site in excess of the ratio permitted under the registered program shall be paid not less than the applicable wage rate on the wage determination for the work actually performed. Where a contractor is performing construction on a project in a locality other than that in which its program is registered, the ratios and wage rates (expressed in percentages of the journeyman's hourly rate) specified in the contractor's or subcontractor's registered program shall be observed. Every apprentice must be paid at not less than the rate specified in the registered program for the apprentice's level of progress, expressed as a percentage of the journeymen hourly rate specified in the applicable wage determination. Apprentices shall be paid fringe benefits in accordance with the provisions of the apprenticeship program. If the apprenticeship program does not specify fringe benefits, apprentices must be paid the full amount of fringe benefits listed on the wage determination for the applicable classification. If the Administrator determines that a different practice prevails for the applicable apprentice classification, fringes shall be paid in accordance with that determination. In the event the Office of Apprenticeship Training, Employer and Labor Services, or a State Apprenticeship Agency recognized by the Office, withdraws approval of an apprenticeship program, the contractor will no longer be permitted to utilize apprentices at less than the applicable predetermined rate for the work performed until an acceptable program is approved. (II) Trainees. Except as provided in 29 CFR 5.16, trainees will not be permitted to work at less than the predetermined rate for the work performed unless they are e mployed pursuant ',to and individually registered in a program which has received prior approval, evidenced by formal certification by the U.S. Department of Labor, Employment and Training Administration. The ratio of trainees to journeymen on the job site shall not be greater than permitted under the plan approved by the Employment and Training Administration. Every trainee must be paid at not less than the rate specified in the approved program for the trainee's level of progress, e xpressed as a percentage of the journeyman hourly rate specified in the applicable wage determination. Trainees shalt be paid fringe benefits in accordance with the provisions of the trainee program. If the trainee program does not mention fringe benefits, trainees shall be paid the full amount of fringe benefits listed on the wage determination unless the Administrator of the Wage and Hour Division determines that there is an apprenticeship program associated with the corresponding journeyman wage rate on the wage determination which provides for less than full fringe benefits for apprentices. Any e mployee listed on the payroll at a trainee rate who is not registered and participating in a training plan approved by Page 3 of 5 form HUD-4010 (06/2009) ref. Handbook 1344.1 the Employment and Training Administration shall be paid n ot less than the applicable wage rate on the wage determination for the work actually performed. In addition, any trainee performing work on the job site in excess of the ratio permitted under the registered program shall be paid not less than the applicable wage rate on the wage determination for the work actually performed. In the e vent the Employment and Training Administration withdraws approval of a training program, the contractor will no longer be permitted to utilize trainees at less than the applicable predetermined rate for the work performed u ntil an acceptable program is approved. (III) Equal employment opportunity. The utilization of apprentices, trainees and journeymen under 29 CFR Part 5 shall be in conformity with the equal employment o pportunity requirements of Executive Order 11246, as amended, and 29 CFR Part 30. 5. Compliance with Copeland Act requirements. The contractor shall comply with the requirements of 29 CFR P art 3 which are incorporated by reference in this contract 6. Subcontracts. The contractor or subcontractor will insert in any subcontracts the clauses contained in subparagraphs 1 through 11 in this paragraph A and such o ther clauses as HUD or its designee may by appropriate instructions require, and a copy of the applicable prevailing wage decision, and also a clause requiring the subcontractors to include these clauses in any lower tier subcontracts. The prime contractor shall be responsible for the compliance by any subcontractor or lower tier subcontractor with all the contract clauses in this paragraph. 7. Contract termination; debarment. A breach of the contract clauses in 29 CFR 5.5 may be grounds for termination of the contract and for debarment as a contractor and a subcontractor as provided in 29 CFR 5.12. 8. Compliance with Davis -Bacon and Related Act Requirements. Ail rulings and interpretations of the Davis -Bacon and Related Acts contained in 29 CFR Parts 1, 3, and 5 are herein incorporated by reference in this contract 9. Disputes concerning labor standards. Disputes arising out of the labor standards provisions of this contract shall not be subject to the general disputes clause of this contract. Such disputes shall be resolved in accordance with the procedures of the Department of Labor set forth in 29 CFR Parts 5, 6, and 7. Disputes within the meaning of this clause include disputes between the contractor (or any of its subcontractors) and HUD or its designee, the U.S. Department of Labor, or the employees or their representatives. 10. (1) Certification of Eligibility. By entering into this contract the contractor certifies that neither it (nor he or she) nor any person or firm who has an interest in the contractor's firm is a person or firm ineligible to be awarded Government contracts by virtue of Section 3(a) of the Davis -Bacon Act or 29 CFR 5.12(a)(1) or to be Previous editions are obsolete awarded HUD contracts or participate in HUD programs pursuant to 24 CFR Part 24. (II) No part of this contract shall be subcontracted to any person or firm ineligible for award of a Government contract by virtue of Section 3(a) of the Davis -Bacon Act or 29 CFR 5.12(a)(1) or to be awarded HUD contracts or participate in HUD programs pursuant to 24 CFR Part 24. (Ili) The penalty for making false statements is prescribed in the U.S. Criminal Code, 18 U.S.C. 1001. Additionally, U.S. Criminal Code, Section 1 01 0, Title 18, U.S.C., "Federal Housing Administration transactions", provides in part: "Whoever, for the purpose of .. influencing in any way the action of such Administration makes, utters or publishes any statement knowing the same to be false shall be fined not more than $5,000 or imprisoned not more than two years, or both." 11. Complaints, Proceedings, or Testimony by Employees. No laborer or mechanic to whom the wage, salary, or other labor standards provisions of this Contract are applicable shall be discharged or in any other manner discriminated against by the Contractor or any subcontractor because such employee has filed any complaint or instituted or caused to be instituted any proceeding or has testified or is about to testify in any proceeding under or relating to the labor standards applicable under this Contract to his employer. B. Contract Work Hours and Safety Standards Act. The provisions of this paragraph B are applicable where the amount of the prime contract exceeds $100,000. As used in this paragraph, the terms "laborers" and "mechanics" include watchmen and guards. (1) Overtime requirements. No contractor or subcontractor contracting for any part of the contract work which may require or involve the employment of laborers or mechanics shall require or permit any such laborer or mechanic in any workweek in which the individual is employed on such work to work in excess of 40 hours in such workweek unless such laborer or mechanic receives compensation at a rate not less than one and one-half times the basic rate of pay for all hours worked in excess of 40 hours in such workweek. (2) Violation; liability for unpaid wages; liquidated damages. In the event of any violation of the clause set forth in subparagraph (1) of this paragraph, the contractor and any subcontractor responsible therefor shall be liable for the unpaid wages. In addition, such contractor and subcontractor shall be liable to the United States (in the case of work done under contract for the District of Columbia or a territory, to such District or to such territory), for liquidated damages. Such liquidated damages shall be computed with respect to each individual laborer or mechanic, including watchmen and guards, employed in violation of the clause set forth in subparagraph (1) of this paragraph, in the sum of $10 for each calendar day on which such individual was required or permitted to work in excess of the standard workweek of 40 hours without payment of the overtime wages required by the clause set forth in sub paragraph (1) of this paragraph. form HUD-4010 (06/2009) Page 4 of 5 ref. Handbook 1344.1 (3) Withholding for unpaid wages and liquidated damages. HUD or its designee shall upon its own action or upon written request of an authorized representative of the Department of Labor withhold or cause to be withheld, from any moneys payable on account of work performed by the contractor or subcontractor under any such contract or any other Federal contract with the same prime contract, or any other Federally -assisted contract subject to the Contract Work Hours and Safety Standards Act which Is held by the same prime contractor such sums as may be determined to be necessary to satisfy any liabilities of such contractor or subcontractor for unpaid wages and liquidated damages as provided in the clause set forth In subparagraph (2) of this paragraph. (4) Subcontracts. The contractor or subcontractor shall insert in any subcontracts the clauses set forth in subparagraph (1) through (4) of this paragraph and also a clause requiring the subcontractors to include these clauses in any lower tier subcontracts. The prime contractor shall be responsible tor compliance by any subcontractor or lower tier subcontractor with the clauses set forth in subparagraphs (1) through (4) of this paragraph. C. Health and Safety. The provisions of this paragraph C are applicable where the amount of the prime contract exceeds $100,000. (1) No laborer or mechanic shall be required to work In surroundings or under working conditions which are unsanitary, hazardous, or dangerous to his health and safety as determined under construction safety and health standards promulgated by the Secretary of Labor by regulation. (2) The Contractor shall comply with all regulations issued by the Secretary of Labor pursuant to Title 29 Part 1928 and failure to comply may result in imposition of sanctions pursuant to the Contract Work Hours and Safety S tandards Act, (Public Law 91-54, 83 Stat 96). 40 USC 1701 et sea. (3) The contractor shall include the provisions of this paragraph In every subcontract so that such provisions will be binding on each subcontractor. The contractor shall take such action with respect to any subcontractor as the S ecretary of Housing and Urban Development or the S ecretary of Labor shall direct as a means of enforcing such provisions. Previous editions are obsolete form HUD-4010 (06/2009) Page 5 of 5 ref Handbook 1344.1 EXHIBIT "I" SECTION 3 REPORTING FORMS WESTERN CENTER RESERVE, LLC HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 Section 3 Summary Report Economic Opportunities for Low — and Very Low -Income Persons Section back of page for Public Reporting Burden statement 1. Recipient Name & Address: (street, city, state, zip) 8. Date Report Submitted: U.S. Department of Housing and Urban Development Office of Fair Housing And Equal Opportunity 2. Federal Identification: (grant no.) 4. Contact Person 6. Length of Grant: 9. Program Code: (Use separate sheet for each program code) Part 1. Employment and Training (** Columns B, A B Number of Job Category New Hires Professionals Technicians Office/Clerical Construction by Trade (List) Trade Trade Trade Trade Trade Other (List) Total Program Codes 1 = Flexible Subsidy 2 = Section 202i811 C and F are mandatory fields. Include New C D Number of New % of Aggregate Number Hires that are of Staff Hours of New Hires Sec. 3 Residents that are Sec. 3 Residents 3 = Public/Indian Housing A = Development, B = Operation C = Modemization Page 1 of 2 Exhibit "I" OMB Approval No: 2529-0043 (exp. 11/30/2010) HUD Field Office: 3. Total Amount of Award: 5. Phone: (Include area code) 7. Reporting Period: 10. Program Name: Hires in E &F) E of Total Staff Hours for Section 3 Employees and Trainees 4 = Homeless Assistance 5=HOME 6 = HOME State Administered 7 = CDBG Entitlement F Number of Section 3 Trainees 8 = CDBG State Administered 9 = Other CD Programs 10 = Other Housing Programs form HUD 60002 (6/2001) Ref 24 CFR 135 I Part II: Contracts Awarded 1. Construction Contracts: A. Total dollar amount of all contracts awarded on the project B. Total dollar amount of contracts awarded to Section 3 businesses C. Percentage of the total dollar amount that was awarded to Section 3 businesses D. Total number of Section 3 businesses receiving contracts 2. Non -Construction Contracts: A. Total dollar amount all non -construction contracts awarded on the project/activity $ B. Total dollar amount of non -construction contracts awarded to Section 3 businesses $ C. Percentage of the total dollar amount that was awarded to Section 3 businesses D. Total number of Section 3 businesses receiving non -construction contracts Part III: Summary Indicate the efforts made to direct the employment and other economic opportunities generated by HUD financial assistance for housing and community development programs, to the greatest extent feasible, toward low -and very low-income persons, particularly those who are recipients of government assistance for housing. (Check all that apply.) Attempted to recruit low-income residents through: local advertising media, signs prominently displayed at the project site, contracts with the community organizations and public or private agencies operating within the metropolitan area (or nonmetropolitan county) in which the Section 3 covered program or project is located, or similar methods. Participated in a HUD program or other program which promotes the training or employment of Section 3 residents. Participated in a HUD program or other program which promotes the award of contracts to business concerns which meet the definition of Section 3 business concerns. Coordinated with Youthbuild Programs administered in the metropolitan area in which the Section 3 covered project is located. Other; describe below. Public reporting for this collection of information is estimated to average 2 hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. This agency may not collect this information, and you are not required to complete this form, unless it displays a currently valid OMB number. Section 3 of the Housing and Urban Development Act of 1968, as amended, 12 U.S.C. 1701u, mandates that the Department ensures that employment and other economic opportunities generated by its housing and community development assistance programs are directed toward low- and very -low income persons, particularly those who are recipients of government assistance housing. The regulations are found at 24 CFR Part 135. The information will be used by the Department to monitor program recipients' compliance with Section 3, to assess the results of the Department's efforts to meet the statutory objectives of Section 3, to prepare reports to Congress, and by recipients as self -monitoring tool. The data is entered into a database and will be analyzed and distributed. The collection of information involves recipients receiving Federal financial assistance for housing and community development programs covered by Section 3. The information will be collected annually to assist HUD in meeting its reporting requirements under Section 808(e)(6) of the Fair Housing Act and Section 916 of the HCDA of 1992. An assurance of confidentiality is not applicable to this form. The Privacy Act of 1974 and OMB Circular A-108 are riot applicable. The reporting requirements do not contain sensitive questions. Data is cumulative; personal identifying information is not included. Page 2 of 2 form HUD 60002 (11/2010) Ref 24 CFR 135 Form HUD-60002, Section 3 Summary Report, Economic Opportunities for Low- and Very Low -Income Persons. Instructions: This form is to be used to report annual accomplishments regarding employment and other economic opportunities provided to low- and very low-income persons under Section 3 of the Housing and Urban Development Act of 1968. The Section 3 regulations apply to any public and Indian housing programs that receive: (1) development assistance pursuant to Section 5 of the U.S. Housing Act of 1937; (2) operating assistance pursuant to Section 9 of the U.S. Housing Act of 1937; or (3) modernization grants pursuant to Section 14 of the U.S. Housing Act of 1937 and to recipients of housing and community development assistance in excess of $200,000 expended for: (1) housing rehabilitation (including reduction and abatement of lead -based paint hazards); (2) housing construction; or (3) other public construction projects; and to contracts and subcontracts in excess of $100,000 awarded in connection with the Section-3-covered activity. Form HUD-60002 has three parts, which are to be completed for all programs covered by Section 3. Part I relates to employment and training. The recipient has the option to determine numerical employment/training goals either on the basis of the number of hours worked by new hires (columns B, D, E and F). Part II of the form relates to contracting, and Part III summarizes recipients' efforts to comply with Section 3. Recipients or contractors subject to Section 3 requirements must maintain appropriate documentation to establish that HUD financial assistance for housing and community development programs were directed toward low- and very low-income persons.* A recipient of Section 3 covered assistance shall submit one copy of this report to HUD Headquarters, Office of Fair Housing and Equal Opportunity. Where the program providing assistance requires an annual performance report, this Section 3 report is to be submitted at the same time the program performance report is submitted. Where an annual performance report is not required, this Section 3 report is to be submitted by January 10 and, if the project ends before December 31, within 10 days of project completion. Only Prime Recipients are required to report to HUD. The report must include accomplishments of all recipients and their Section 3 covered contractors and subcontractors. HUD Field Office: Enter the Field Office name . 1. Recipient: Enter the name and address of the recipient submitting this report. 2. Federal Identification: Enter the number that appears on the award form (with dashes). The award may be a grant, cooperative agreement or contract. 3. Dollar Amount of Award: Enter the dollar amount, rounded to the nearest dollar, received by the recipient. 4 & 5. Contact Person/Phone: Enter the name and telephone number of the person with knowledge of the award and the recipient's implementation of Section 3. 6. Reporting Period: Indicate the time period (months and year) this report covers. 7. Date Report Submitted: Enter the appropriate date. Submit one (1) copy of this report to the HUD Headquarters Office of Fair Housing and Equal Opportunity, at the same time the performance report is submitted to the program office. The Section 3 report is submitted by January 10. Include only contracts executed during the period specified in item 8. PHAs/IHAs are to report all contracts/subcontracts. * The terms "low-income persons" and very low-income persons" have the same meanings given the terms in section 3 (b) (2) of the United States Housing Act of 1937. Low-income persons mean families (including single persons) whose incomes do not exceed 80 percent of the median income for the area, as determined by the Secretary, with adjustments for smaller and larger families, except that Pagel 8. Program Code: Enter the appropriate program code as listed at the bottom of the page. 9. Program Name: Enter the name of HUD Program corresponding with the "Program Code" in number 8. Part I: Employment and Training Opportunities Column A: Contains various job categories. Professionals are defined as people who have special knowledge of an occupation (i.e. supervisors, architects, surveyors, planners, and computer programmers). For construction positions, list each trade and provide data in columns B through F for each trade where persons were employed. The category of "Other" includes occupations such as service workers. Column B: (Mandatory Field) Enter the number of new hires for each category of workers identified in Column A in connection with this award. New hire refers to a person who is not on the contractor's or recipients payroll for employment at the time of selection for the Section 3 covered award or at the time of receipt of Section 3 covered assistance. Column C: (Mandatory Field) Enter the number of Section 3 new hires for each category of workers identified in Column A in connection with this award. Section 3 new hire refers to a Section 3 resident who is not on the contractor's or recipient's payroll for employment at the time of selection for the Section 3 covered award or at the time of receipt of Section 3 covered assistance. Column D: Enter the percentage of all the staff hours of new hires (Section 3 residents) in connection with this award. Column E: Enter the percentage of the total staff hours worked for Section 3 employees and trainees (including new hires) connected with this award. Include staff hours for part-time and full-time positions. Column F: (Mandatory Field) Enter the number of Section 3 residents that were trained in connection with this award. Part 11: Contract Opportunities Block 1: Construction Contracts Item A: Enter the total dollar amount of all contracts awarded on the project/program. Item B: Enter the total dollar amount of contracts connected with this project/program that were awarded to Section 3 businesses. Item C: Enter the percentage of the total dollar amount of contracts connected with this project/program awarded to Section 3 businesses. Item D: Enter the number of Section 3 businesses receiving awards. Block 2: Non -Construction Contracts Item A: Enter the total dollar amount of all contracts awarded on the project/program. Item B: Enter the total dollar amount of contracts connected with this project awarded to Section 3 businesses. Item C: Enter the percentage of the total dollar amount of contracts connected with this project/program awarded to Section 3 businesses. Item D: Enter the number of Section 3 businesses receiving awards. Part III: Summary of Efforts — Self -explanatory The Secretary may establish income ceilings higher or lower than 80 percent of the median for the area on the basis of the Secretary's findings such that variations are necessary because of prevailing levels of construction costs or unusually high- or low-income families. Very low-income persons mean low-income families (including single persons) whose incomes do not exceed 50 percent of the median family income area, as determined by the Secretary with adjustments or smaller and larger families, except that the Secretary may establish income ceilings higher or lower than 50 percent of the median for the area on the basis of the Secretary's findings that such variations are necessary because of unusually high or low family incomes. forrn HUD 60002 (11/2010) Ref 24 CFR 135 EXHIBIT "J" STANDARDS FOR COMPLETE DOCUMENTATION WESTERN CENTER RESERVE, LLC HOME CONSTRUCTION CONTRACT — EXHIBITS Western Center Reserve, LLC — Reserve at Western Center Rev. 10-17-13 FORT WORTH. ,............r Exhibit "J" Standard of Documentation for Reimbursement of Development Costs Cost Type Documentation Standard Acquisition of Vacant Lots • Notice to Seller (date must be on or before the date of options agreement or sales contract and signed by the buyer and seller) • Recorded Deed of Trust • Purchase Agreement w/ Required HUD language • Master Settlement Statement • Appraisal or other document used to determine purchase price • Proof of Payment (bank statement/cancelled check) Soft Costs (Architect, Engineer, Landscaping, Surveys, Appraisals, Environmental, Legal Fees, Other Consultants, Etc.) CHDO Operating/Project Delivery Expenses • Invoice - Invoice should include: date; company's letterhead; address for which service is provided; description of service(s) and item(s); amount for itemized services; and total amount • Proof of Payment (ie. bank statement or cancelled check) • If applicable, fully executed contract/service agreements and applicable amendments - Provide printout from www.sam.gov verifying contractor/subcontractor is not listed on the debarred and suspension list • If only a portion is being paid with City funds, then show calculation and documentation of how costs are allocated. • Invoice - Invoice should include: date; company's letterhead; address for which service is provided; description of service(s) and item(s); amount for itemized services; and total amount • Proof of Payment (i.e. bank statement or cancelled check) • Timesheet(s) Signed by Employee and Supervisor • Activity Log(s) Signed by Employee and Supervisor • Pay Period Dates Should be Reflected • If paying for rent or contract services, copy of executed agreements • If only a portion is being paid with City funds, then show calculation and documentation of how costs are allocated. Housing and Economic Development FINAL as of 4/24/2013 Page 1 FORT WORTH® Standard of Documentation for Reimbursement of Development Costs Construction Costs (Contractors & Subcontractors) Materials Purchased by Developer Developer Fee • Invoice - Invoice should include: date; company's letterhead; address for which service is provided; description of service(s) and item(s); amount for itemized services; and total amount • Proof of Payment (i.e. bank statement or cancelled check) • Timesheet(s) Signed by Employee and Supervisor - Activity Sheet(s) Signed by Employee and Supervisor - Pay Period Dates Should be Reflected • Copy of applicable inspection report(s) conducted by HED Inspector • Copy of executed agreements - Provide printout from www.sam.gov verifying contractor/subcontractor is not listed on the debarred and suspension list • If only a portion is being paid with City funds, then show calculation and documentation of how costs are allocated. • For retainage for the prime contractor, lien waivers for the prime and all subcontractors. • Invoice - Invoice should include: date; company's letterhead; address where materials will be used; description of service(s) and item(s); cost by quantity; and total amount • Proof of Payment (i.e. bank statement or cancelled check) • Final Invoice Reflecting Total Development Cost • Proof of payment for any other entity contributing to development costs. • Show calculation of agreed upon developer fee percentage • Copies of final lien releases from contractor/subcontractor • Complete Documentation required in contract for home/unit produced (i.e. income docs for eligible homebuyer, sales contract between developer/homebuyer, HAP Deed of Trust w/ required affordability period language, etc) Housing and Economic Development FINAL as of 4/24/2013 Page 2 M&C Review CIL AGENDA Page 1 of 3 Official site of the City of Fort Worth, Texas FORT WORTII COUNCIL ACTION: Approved on 3/20/2012 - Resolution No. 4069-03-2012 DATE: CODE: SUBJECT: C 3/20/2012 REFERENCE **C-25489 LOG NO.: NAME: TYPE: CONSENT PUBLIC NO HEARING: Authorize Change of Use and Expenditure in the Amount of $368,000.00 of HOME Investment Partnerships Program Grant Funds to Miller Valentine Group or its Designated Affiliate, in the Form of an Interim Loan for the Reserve at Western Center, a Multifamily Housing Development to Be Located at Western Center Boulevard and Blue Mound Road, Authorize Execution of a Conditional Commitment and Contract, Authorize Substantial Amendment to the City of Fort Worth's 2009-2010 and 2010-2011 Action Plans and Substitution of Funding Years and Adopt Resolution Supporting the 2012 Low Income Housing Tax Credit Application for the Development (COUNCIL DISTRICT 2) 17RESERVEATWESTERNCENTER RECOMMENDATION: It is recommended that the City Council: 1. Authorize a substantial amendment to the City of Fort Worth's 2009-2010 and 2010-2011 Action Plans; 2. Authorize substitution of current and prior funding years in order to meet commitment, disbursement and expenditure deadlines for grant funds from the United States Department of Housing and Urban Development; 3. Authorize Change in Use and Expenditure in the amount of $368,000.00 in prior years HOME Investment Partnerships Program Grant funds to the Miller Valentine Group or its designated affiliate, in the form of a interim repayment loan for the development of the Reserve at Western Center; 4. Authorize the City Manager or his designee to execute a Conditional Commitment with the Miller Valentine Group or its designated affiliate, for a interim repayment loan that conditions funding on completion of the Environmental Review, satisfactory completion of HOME requirements, and among other things, receipt of Low Income Housing Tax Credits from the Texas Department of Housing and Community Affairs; 5. Authorize the City Manager or his designee to execute a HOME Investment Partnerships Program Contract with the Miller Valentine Group or its designated affiliate, for the Development of a term beginning on the date of execution of the contract and ending on the date the 20 year affordability period expires; 6. Authorize the City Manager or his designee to extend or renew the Conditional Commitment or the Contract for up to one year if Miller Valentine Group requests an extension and such extension is necessary for completion of the Development; 7. Authorize the City Manager or his designee to amend the Conditional Commitment or the Contract if necessary to achieve project goals provided that the amendment is within the scope of the Development and in compliance with City of Fort Worth policies and applicable laws and regulations governing the use of Federal Grant Funds; and 8. Adopt attached Resolution supporting the 2012 Low Income Housing Tax Credit application. DISCUSSION: The Housing and Economic Development Department issued a Request For Proposals (RFP) in http://wwvv.fortworthgov.org/council_packet/mc review.asp?ID=16613 &counci ldate 3/... 03/21/2012 M&C Review Page 3 of 3 ATTACHMENTS LIHTC Miller Valentine Resolution 3-20-1 (21VG.doc ReserveaWesternCenterCounci lM ap. pdf http://www.fortworthgov.org/council packet/mc_review.asp?ID=16613&councildate=3/... 03/21/2012