HomeMy WebLinkAboutRegulatory Agreement & Deed Rider 2004.12 - Legal Document - 0000 Meetinghouse Road 12/1/2004 F
E
i REGULATORY AGREEMENT
[FHLBB-NEW ENGLAND FUND]
For Ownership Projects
This Regulatory Agreement(this"Agreement") is made this day of December,
2004 by and among Meetinghouse Commons, LLC, a Massachusetts limited liability company
having an address at 121. Carter Field Road North Andover Massachusetts 01845
("Developer"), Salem Five Cents Savings Bank,of 21.0 Essen Street,Salem,Massachusetts
01970 Attn: Mark H. Leff Senior Vice President(the"Bank"), a member institution of the
Federal Home Loan Bank of Boston, and the Town of North Andover, by and through its Board
of Selectmen, having an address at 120 Main Street, North Andover,Massachusetts 01845 (the
"Municipality").
BACKGROUND:
A. The Developer intends to construct an 88-unit homeownership development on a
32,02-acre site off South Bradford and Dale Streets in North Andover, Massachusetts, more
particularly described in Exhibit A attached to and made a pant of this Agreement(the "Project"),
B. The Developer has received a comprehensive permit(the"Comprehensive
Perniit")from the Zoning Board of Appeals for the Town of North Andover (the "Municipality")
under Chapter 40B of the Massachusetts General Laws,which permit is recorded at the Essex
North District Registry of.Deeds in Boob 8941, Page 289 (the "Registry").
C. The Comprehensive Kermit has specified that 22 units,or 25 %of the total units
in the.Project will be affordable units (the"Affordable Units'')which will be subject to this
Regulatory Agreement to restrict the sale of the Affordable Units to qualifying low or moderate
income income buyers pursuant to the Federal Home Loan Bank of Boston's New England Fund
("NEF") Program and Chapter 40B.
D. Pursuant to the terms of this Regulatory Agreement, the Affordable Units will be
sold to households earning no more than eighty percent(80%)of the median income, by
household size,for the Lawrence. MA-NH PMSA Area (the"Base Income") as published from
time to time by the Department of Housing and Community Development of the Commonwealth
of Massachusetts or successor agency("DHCD").
E. The Project is being financed under the Federal Home Loan Bank of Boston's
New England Fund("NEF")and the NEF requires that the Developer provide the number of
Affordable Units described above;
R Pursuant to the requirements of the Comprehensive Permit and this Regulatory
Agreement, the Developer has agreed to retain Citizens' Housing and-Planning Association, Inc.
(the"Monitoring Agent")to perform monitoring and enforcement services regarding compliance
of the Project with the Affordability Requirement and compliance of the Developer with the
Limited Dividend Requirement.
1
j
G. The Affordable Units shall be specifically designated in the Master Deed
establishing the Meetinghouse Commons Condominium,which Master Deed shall be recorded at
the Registry prior to occupancy of the Units. The Affordable Units are shall be referred to as the
Affordable Units in the Master Deed.
11, The Municipality has agreed, and by execution of this Regulatory Agreement,
becomes the holder of the affordable housing restriction, as defined in M.G.L. c. 184,secs. 26,
31,32 and 33, as approved by the Department of 1-lousing and Community Development as
evidenced herein.
NOW,THEREFORE, in consideration of the agreements and covenants set forth in this
Agreement, and other good and valuable consideration, the receipt and sufficiency of which are
acknowledged, the Developer and the Bank agree and covenant as follows:
1. Unit Designation,. The distribution of the Affordable Units by unit size shall be as
set forth below-
2BR
Number of Units 22
Units/Lots Nos.
Initial Market Appraised Value $ $495,000
Initial Affordable Price(the initial $ $162,900
Certified Sale price)
The Certified Sale Price of an Affordable Unit shall be the price such that a household earning
the Base Income for a family of three would pay no more than 33% of gross income for the sum
of annual debt service on a mortgage of 95% of the Certified Sales Price (including principal and
interest at current interest rates) plus property taxes, insurance and any condominium/
homeowner association fees. The Affordable Units shall be specifically designated in the Master
Deed establishing the Meetinghouse Commons Condominium, which Master Deed shall be
recorded at the Registry prior to occupancy of the Units. The Affordable Units are shall be
referred to as the Affordable Units in the Master Deed.
2, Affordability. Except as specifically provided in the Deed Rider attached as
Exhibit B, the Affordable Units shall be sold to households which have an annual income equal
to or less than the Base Income as adjusted from time to time according to DHCD guidelines.
The first sale of an Affordable Unit by the Developer shall be at a price not in
excess of the Initial Affordable Price set forth in Section 1 of this Agreement for that Affordable
Unit, as the same may be adjusted by the Monitoring Agent consistent with the affordability
provisions set forth in this section and in Section 1 above. Subsequent sales of Affordable Units
1
f
2
i
i shall be for sale prices as determined by the Monitoring Agent under the definitions set forth in
this section and in section 1 above(the"Maximum Sale Price").
3. Deed Riders. At the time of sale of the Affordable Units by the Developer, the
Developer shall execute and shall as a condition of sale cause the purchasers of the Affordable
Units to execute a deed rider substantially in the form of Exhibit B attached to and made a part of
this Agreement(each a"Deed Rider"). Each Deed Rider shall require the unit owner at the time
he/she desires to sell the Affordable Unit to notify the Monitoring Agent so that the Monitoring
Agent can make a determination of the Maximum Resale Price. The owner of the Affordable
Unit must thereafter offer the unit to the Municipality at the Maximum Resale Price. The
Municipality may or may not exercise its right-of-first refusal at its sole discretion,and if not, the
seller must find a purchaser who meets the income guidelines.
If the Affordable Unit owner is unable to find an eligible purchaser within a 120
day period from the date the Affordable Unit was put on the market, as determined by the date of
the first advertisement.for sale, or the date an agreement was signed with a listing broker to
market the Affordable Unit, the seller can sell the Affordable Unit to any person, regardless of
his/her income and at the Maximum Resale Price, provided that the affordability of each
Affordable Unit will be preserved each time that subsequent resale of the Affordable Unit occurs
during the period of affordability specified in this Agreement and as more clearly specified in the
Deed Rider.
The Deed Rider requires the Affordable Unit owner and any purchaser to execute
at the time of resale a similar Deed Rider which shall be attached to and made a part of the deed
from the owner to the purchaser, so that the affordability of each Affordable Unit will be
preserved each time that subsequent resale of the Affordable Unit occurs during the period of
affordability specified in this Agreement.
i
4. Dividend Limitation. Developer agrees that the profit to the Developer or to the
partners, shareholders, or other owners of Developer or of the Project shall not exceed twenty
percent(20%)of total development costs of the Project, exclusive of development fees(the
"Allowable Profit"), Upon issuance of a final Certificate of Occupancy for all of the units in the
Project, the Developer shall deliver to the Monitoring.Agent an itemized statement of total
development costs together with a statement of gross sales revenues from the Project received by
the Developer to date certified by the Developer("Certified Costs and Income Statement"). If all
units in the Project which are offered for sale have not been sold as of the date the Certified Cost
and Income Statement is delivered to the Monitoring Agent, the Developer shall at least once
every ninety(90)days thereafter, until such time as all of the units which are offered for sale are
sold, deliver to the Monitoring Agent an updated Certified Cost and Income Statement. After all
units in the project which are offered for sale have been sold, the Developer shall deliver to the
Monitoring Agent a final Certified Cost and Income Statement. All profits from the Project in
excess of the Allowable Profit shall be paid by the Developer to the Municipality for deposit in
an affordable housing fund to be used by the Municipality for the purposes of encouraging,
creating or subsidizing the construction or rehabilitation of affordable housing elsewhere in the
Municipality. The Allowable.Profit shall be, measured as the excess of certified income, less any
brokerage fees and commissions and selling expenses over certified costs and less all
3
1 development costs related to the Project including costs incurred by the developer as
administrative and overhead expenses which do not exceed four percent(4%)of total
development costs,excluding such administrative and overhead costs. Acceptable development
costs include, but are not limited to, the cost of site acquisition, defined as that land value which
can be underwritten by the Project and which can be supported by the subsidizing entity's
appraisal upon which its construction loan is based,
5. Affirmative Marketing. The Developer shall not discriminate on the basis of race,
creed, color, sex, age, handicap, marital status, national origin or any other basis prohibited by
law in the selection of the buyers for the Affordable Units. The Developer shall affirmatively
market the Affordable Units to minority households through direct outreach efforts to local
churches, social service and civic organizations as well as local and area-wide Newsprint media
where minority households are most likely to be contacted. This outreach effort must continue
for a period of at least GO days prior to the selection of buyers for the Affordable Units. The
Developer agrees to maintain for at least five(5)years following the sale of the Affordable
Units, a record of all newspaper ads, outreach letters translations, leaflets and any other outreach
efforts which may be inspected by the Monitoring Agent or the Municipality.
b. Recording. Upon execution of this Agreement, the Developer shall immediately
cause this Agreement to be recorded or filed with the Registry. Upon recording and/or filing as
applicable, the Developer shall immediately transmit to the Bank, the Municipality, and the
Monitoring Agent evidence of such recording and/or filing.
7. Representations. The Developer represents, covenants and warrants as follows:
(a) The Developer(i) is a limited liability company duly organized under the laws
of the Commonwealth of Massachusetts,and is qualified to transact business
under the laws of this state, (ii)has the power and authority to own properties and
assets and to carry on its business as now being conducted, and (iii) has full legal
right,power and authority to execute and deliver this Agreement.
(b) The execution and performance of this Agreement by the Developer(i)will not
violate or, as applicable, has not violated any provision of law, rule or regulation,
or any order of any court or other agency or governmental body, and (ii)will not
violate or,as applicable, has not violated any provision of any indenture,
agreement, mortgage, mortgage note or other instrument to which the Developer
is a party or by which it or the.Project is bound, and(iii)will not result in the
creation or imposition of any prohibited encumbrance of any nature.
(c) The Developer will, at the time of execution and delivery of this Agreement, have
good and marketable title to the Project free and clear of any lien or encumbrance,
subject to the encumbrances created pursuant to this Agreement, any loan
documents relating to the Project, or other permitted encumbrances.
8, Governing Law Amendments Severabilit . This Agreement shall be governed by
the laws of the Commonwealth of Massachusetts. Any amendments to this Agreement must be
I
4
i
i
in writingand executed by all of the parties to this Agreement. The invalidity of any clause,
part, or provision of this Agreement shall not affect the validity of the remaining portions of this
Agreement. In the event of any ambiguity or dispute as to the interpretation of any provisions in
this Agreement, then this Agreement shall be interpreted in accordance with the generally
accepted practices at the time of issuance of the project eligibility letter.
9. Monitoring Agent. The Developer shall retain the Monitoring Agent for purposes
of monitoring Developer's performance under this Agreement pursuant to an agreement
acceptable to the Monitoring Agent and the bank. All notices and reports required to be
submitted under this Agreement shall be submitted directly to the Monitoring Agent. The
Monitoring Agent shall have authority to act in all matters relating to this Agreement.
3
10, Notices. All notices to be given pursuant to this Agreement shall be in writing
and shall be deemed given when delivered by hand or when mailed by certified or registered
mail,postage prepaid, return receipt requested,to the parties to this Agreement at the addresses
forth law or to such other lace as a art may from time to time designate b written
setbe
p party Y 1� Y
notice with a copy to the Monitoring Agent:
Developer:
Meetinghouse Commons, LLC
121 Carter Field Road
North Andover,Massachusetts 01845
Attn: Thomas D. Zahoruiko, Manager
1 Bank:
Salem Five Cents Savings Bank
210 Essex Street
Salem,Massachusetts 01970
Attn: Mark H. Leff, Senior Vice President
Municipality:
Board of Selectmen
Town of North Andover
120 Main Street
North Andover, Massachusetts 01845
Attn: Chairperson
Monitoring Agent:
Citizens Housing and Planning Association, Inc.
18 Tremont Street
'Boston, Massachusetts 02108
Attention: Executive Director
11. Term. The term of this Agreement shall be that which is identified in the
Comprehensive Permit Decision,dated May 24,2002, as the same may be amended from time to
5
1
time(the"Comprehensive Permit Decision") and shall terminate with respect to each of the
Affordable Units on the date on which the Deed Rider attached as Exhibit B is no longer
applicable to such Affordable Unit.
Upon the expiration of the term of this Agreement,each of the then owners of
Affordable Units shall be bound to pay to the Municipality (a) all proceeds of sale at the time of
sale in excess of the Maximum Sale Price of such unit at the time of sale as if such unit were still
subject to the provisions of this Agreement,which sale shall be at arms length and for the fair
market value of such unit,or(b)a payment by refinancing or from other sources to the
Municipality in the same amount as the Municipality would receive if such unit were still subject
to the provisions of this Agreement in the event of a sale at fair market value on the date of
payment the expiration of the term of this Agreement. The provisions of this section of this
Agreement shall survive the expiration of the term of this Agreement.
12. Successors and Assigns. The Developer intends, declares and covenants on
behalf of itself and its successors and assigns (i)that this Agreement and the covenants,
agreements and restrictions contained in this Agreement shall be and are covenants running with
the land, encumbering the Project for the term of this Agreement, and are binding upon the
Developer's successors in title, (ii)are not merely personal covenants of the Developer, and (iii)
shall bind the Developer, its successors and assigns for the term of this Agreement. Developer
agrees that any and all requirements of the laws of the Commonwealth of Massachusetts to be
satisfied in order for the provisions of this Agreement to constitute restrictions and covenants
running with the land shall be deemed to be satisfied in fall and that any requirements of privity
of estate are also deemed to be satisfied in full.
13. Default. If any default,violation or breach by the Developer under this
Agreement is not cured to the satisfaction of the Monitoring Agent within thirty(30)days after
notice to the Developer thereof,then the Monitoring Agent may send notification to the Bank
and the FHLBB that the Developer is in violation of the terms and conditions of this Agreement.
The Bank and/or the FHLBB may exercise any remedy available to them, including calling its
advance under the NEF or increasing the interest rate on such advance. The Municipality or the
Monitoring Agent may also exercise any legal remedy available to them. The Developer shall
pay all costs and expenses, including legal fees,incurred by Monitoring Agent in enforcing this
Agreement, and,in the event of any action by the Monitoring Agent against the Developer, the
Monitoring Agent shall be entitled to seek an attachment against the Developer's property
including,without limitation, its interest in the Project. The Monitoring Agent"lay perfect a lien
on the Project by recording/filing one of more certificates setting forth the amount of the costs
and expenses due and owing in the Registry. A purchaser of the Project of any portion of it shall
be liable for the payment of any unpaid costs and expenses which were the subject of a
recordedlfited certificate prior to the purchaser's Acquisition of the Project or portion thereof.
14. Mortgagee Consent. The Developer represents and warrants that it has obtained
the consent or subordination of all existing mortgagees of the Project to the execution and
recording of this Agreement and to the terms and conditions of this Agreement and that all such
mortgagees have executed a consent or subordination to this Agreement which shall be
recorded/filed herewift
l
6
15. Affordable Housing Restriction. This Agreement and all of the covenants,
agreements and restrictions contained herein shall be deemed to be an affordable housing
restriction as that term is defined in G.L. c. 184, § 31 and as that term is used in G.L. c.184, § 26,
31,32 and 33. This Agreement is made for the benefit of the Municipality, and the Municipality
shall be deemed to be the holder of the affordable housing restriction created by this Agreement.
The Municipality has determined that the acquiring of such affordable housing restriction is in
the public interest. The term of this Agreement shall be the term of years required under the
Comprehensive Permit Decision, dated May 24,2002, as the same may be amended from time to
time (the"Comprehensive Permit Decision"), except as otherwise provided in the Deed. Further,
the Resale Restrictions contained in each of the Deed Riders which are to encumber each of the
Affordable Units at the Project pursuant to the requirements of this Agreement shall also
constitute an affordable housing restriction as that term is defined in G.L. c. 184, § 31 and as that
term is used in G.L. c. 184, §§ 26, 31.,32, and 33. Such Resale Restrictions shall be for the
benefit of the Municipality and the Municipality shall be deemed to be the holder of the
affordable housing restriction created by the Resale Restrictions in each of the Deed Riders, The
Municipality has determined that the acquiring of such affordable housing restriction is in the '
public interest. To the extent that the Municipality is the holder of the Resale Restrictions to be
contained in each of the Deed Riders, the Director of DHCD by the execution of the Certificate
of Approval attached to and made a part of this Agreement hereby approves such Resale
Restrictions in each of the Deed Riders for the Low and Moderate Income Units of the Project as
required by the provisions of G.L. c. 184, § 32.
16, Responsibility of Monitoring Agent. The Monitoring Agent shall not be held
liable for any action taken or omitted under this Agreement so long as it shall have acted in good
faith and without gross negligence.
17. Indemnification, The Developer,:for itself and its successors and assigns, agrees
to indemnify and hold harmless the Monitoring Agent against all damages, costs and liabilities,
including;reasonable attorney's fees,asserted against the Monitoring Agent by reason of its
relationship to the Project and under this Agreement and not involving the Monitoring Agent
acting in bad faith and with gross negligence.
18. Amendments. This Agreement shall not be amended without written consent of
the Monitoring Agent.
IN WITNESS WHEREOF, the parties to this Agreement have caused this Agreement to
be,executed as a sealed instrument as of the date first above written.
DEVELOPER: BANK:
7
i
MEETINGHOUSE COMMONS, LLC SALEM FIVE CENTS SAVINGS BANK
By: By:.
Thomas D. Zahoruiko Mark H. Leff
Its: Manager Its: Senior Vice President
COMMONWEALTH OF MASSACHUSETTS
ss
On this day of , 2004, before me, the undersigned notary public,
personally appeared Thomas D. Zahoruiko, proved to me through satisfactory evidence of
identification,which was❑driver's license,EJ personally known to me, or❑ personally known to
3rd party witness personally known to me, to be the person whose name is signed on the
preceding or attached document, and acknowledged to me that he signed it voluntarily for its
stated purpose as Manager,for Meetinghouse Commons, LLC, a limited liability company.
Notary Public
COMMONWEALTH OF MASSACHUSETTS
,ss
On this_day of , 2004, before me, the undersigned notary public,
personally appeared , proved to me through satisfactory evidence of
identification,which was❑driver's license, ❑personally known to me, or ❑personalty known to
3`d party witness personally known to me, to be the person whose name is signed on the
preceding or attached document, and acknowledged to ine that he signed it voluntarily for its
stated purpose as , for Salem Five Cents Savj!Ms Bank.
Notary Public
8
MUNICIPALITY:
TOWN OF NORTH ANDOVER BOARD OF SELECTMEN
We,the undersigned, being the majority of the Board of Selectmen of the Town of North
Andover,hereby certify that at a meeting held on December_, 2004, the Board of Selectmen
voted to agree to become the holder of the forgoing affordable housing preservation restriction
for the Meetinghouse Commons Comprehensive Permit Project pursuant to M.G.L. c.184, sec.
32.
Town of North Andover,
By and through its Board of
Selectmen
By:
By:
By:
By:
By:
COMMONWEALTH OF MASSACHUSETTS
, ss
On this_day of 2004, before me, the undersigned notary public,
personally appeared
, and , as members of the North Andover Board of Selectmen,
proved to me through satisfactory evidence of identification, which was ❑ driver's license, ❑
personally known to me, or ❑ personally known to 34 party witness personally known to me, to
be the persons whose names are signed on the preceding or attached document, and
acknowledged to me that they signed it voluntarily for its stated purpose as members of the
Town of North Andover Board of Selectmen..
Notary Public
9
ii
EXHIBIT A
LEGAL DESCRIPTION
i
i
10
' EXHIBIT B
DEED RIDER
For
FHLBB New England Fund
Ownership Project
(annexed to and made part of that certain deed(the"Deed")
From Meetinghouse Commons, LLC ("Grantor")
To ("Grantee")
Dated 7200�
WITNESSETH;
WHEREAS, a comprehensive permit for land in the City[Cown of North Andover,
Massachusetts(the"Municipality")has been granted under Chapter 40B of M.G.L. for the
purpose for constructing S$ residential units(the"Project")comprised of 66 units to be sold by
the Grantor at market rates,22 units to be sold to households with low and moderate incomes in
accordance with the terms and provision of the Regulatory Agreement by and between
Meetinghouse Commons, LLC (the "Developer")and Salem Five Cents Savings n(the
"Bank"),as part of the New England Fund Program (the"Regulatory Agreement")which
Regulatory Agreement is dated November ,2004 and is recorded/filed with the Essex North
District Registry of Deeds(the"Registry")in Book ,at Page ;
WHEREAS, the rights and restrictions granted in this Rider to the Municipality serve the
public's interest in the creation and retention of affordable housing for persons and families of
low and moderate income and in the restricting the resale price of property in order to assure its
affordability by future low and moderate income purchasers;
WHEREAS,pursuant to the Regulatory Agreement,eligible purchasers such as the
Grantee are given the opportunity to purchase certain property at an affordable price if the
purchaser agrees to convey the property on resale to an eligible purchaser located by the
Municipality or,to the Municipality, for a"Maximrun Resale Price"as specified in this Rider
and in the Regulatory Agreement;
WHEREAS,the Grantor and the Grantee are participating in the NEF Program, and in
accordance with the NEF Program the Grantor is conveying that certain real property more
particularly described in the Deed to which this Deed Rider is attached ("Property")to the
Grantee at a consideration which is less than the appraised value of the Property; and
1
:i 1.
} WHEREAS, the Maximum Resale Price shall be determined as that price which is
affordable to an eligible purchaser whose income does not exceed the Base income as described
in the Regulatory Agreement.
NOW THEREFORE, as further consideration from the Grantee to the Grantor and the
Municipality for.the conveyance of the Property at a n affordable price in accordance with the
Regulatory Agreement, the Grantee,his/her heirs, successors and assigns, agrees that the
Property shall be subject to the following rights and restrictions which are imposed for the
benefit of and shall be enforceable by,the Grantor's assignees and designees,or the Monitoring
Agent,or the Municipality, acting by and through its chief elected official.
1. Right of First Refusal. (a) When the Grantee or any successor in title to the
Grantee shall desire to sell, dispose of or otherwise convey the Property,or any portion thereof,
the Grantee shall first notify the Monitoring Agent and subsequently the Municipality in writing
of the Grantee's intention to so convey the Property(the "Notice"). The Notice shall set forth
the Maximum Resale Price of the Property and shall advise the Municipality of a thirty (30)day
right of first refusal in favor of the Municipality. The Maximum Resale Price is equal to the
amount which is affordable to an eligible purchaser whose income does not exceed the Base
Income as defined in the Regulatory Agreement. Within thirty(30) days of the giving of the
Notice by the Grantee, the Municipality shall notify the Grantee in writing as to whether the
Municipality is proceeding to locate an eligible purchaser of the Property or the Municipality
shalt exercise its right of first refusal to purchase the Property (the"Municipality's Notice"). For
the purpose of the Deed Rider, and "eligible purchaser"shall mean a purchaser whose household
income does not exceed the Base Income as defined in the Regulatory Agreement, and who, if
located by the Municipality, is ready and willing to purchase the Property within ninety (90) days
after the Grantee gives the Notice.
(b) In the event that(i)the Municipality's Notice states that the Municipality
does not intend to proceed to locate an eligible purchaser and that the Municipality does not
intend to exercise its right of first refusal to purchase the Property,or the Municipality fails to
give the Municipality's Notice within thirty(30) days,the Grantee must use diligent efforts to
find an eligible purchaser within a one hundred twenty(120)day period from the date the
Property is put on the market, as determined by the date of the first advertisement for sale,as set
forth below. The term"diligent efforts"shall mean(A) the placement of an advertisement in the
real estate section of at least one(1)newspaper of general circulation for a period of three (3)
consecutive weeks which sets forth a customary description of the unit for sale, a single price
which in not in excess of the Maximum Resale Price, Grantee's telephone number, and the
phrase: "Sale of-unit subject to certain guidelines and restrictions with respect to the
maintenance and retention of affordable housing for households of low and moderate income, "
and (B) the receipt of satisfactory evidence that the new purchaser qualifies as an eligible
purchaser, If the Grantee is unable to locate an eligible purchaser within one hundred twenty
(120)days from the date the Property is put on the market, the Grantee may convey the Property
to any third party, regardless of income,who may or may not qualify as an eligible purchaser
("Ineligible Purchaser"), at an amount that does not exceed the Maximum Resale Price. Upon
request of the unit owner or grantee, the Municipality, acting by and through its Chief Elected
Official, shall issue to the unit owner or a third party a certificate in recordable form(the
"Compliance Certificate") stating that the Municipality has elected not to exercise its right of
12
first refusal hereunder. This Compliance Certificate may be recorded in the appropriate.Registry
of Deeds or registered with the appropriate Registry District of the Land Court and such
Compliance Certificate may be relied upon by the then owner of the Property and by third
parties, The Property sold to an Ineligible Purchaser shall be subject to the continuing
obligations and restrictions contained in this deed rider, so that when the Property is resold by
the Ineligible Purchaser, the sale procedure outlined above must be followed by the selling
Ineligible Purchaser,with the right of first refusal stated above still existing and the restriction of
the sale being to an eligible purchaser. The deed to the Ineligible Purchaser shall clearly state
that the Property is being conveyed subject to this deed rider,
(c) In the event the Municipality,within said thirty(30)day period,notifies
the Grantee that the Municipality is proceeding to locate an eligible purchaser or that the
Municipality shall exercise the Municipality's right of first refusal to purchase the Property,the
Municipality may locate an eligible purchaser,who shall purchase the Property at a price not in
excess of the Maximum Resale Price subject to a Deed Rider,within sixty(60) days of the date
that the Municipality's Notice is given, or the Municipality may purchase the Property itself at a
price not in excess of the Maximum Resale Price within sixty(60)days of the date that the
Municipality's Notice is given. If more than one (1) eligible purchaser is located by the
Municipality, the Municipality shall conduct a lottery or other like procedure to determine which
eligible purchaser shall be entitled to the conveyance of the Property,
(d) If an eligible purchaser is selected to purchase the Property, or if the
Municipality elects to purchase the Property, the Property shall be conveyed by the Grantee to
such eligible purchaser or to the Municipality as the case may be,by a good and sufficient
quitclaim deed conveying a good and clear record and marketable title to the Property free from
all encumbrances except(i)such taxes for the then current year as are not due and payable on the
date of delivery of the deed, (ii) any lien for municipal betterments assessed after the date of the
Notice, (iii)provisions of local building and zoning laws, (iv) all easements, restrictions,
covenants and agreements of record specified in the Deed from the Grantor to Grantee, (v) the
Regulatory Agreement which cannot be amended without the consent of the Monitoring Agent,
(vi) such additional easements,restrictions,covenants and agreements of record as the
Municipality and the Monitoring Agent consent to, such consent not to be unreasonably withheld
or delayed, and (vii) in the event that the Property is conveyed to an eligible purchaser, a Deed
Rider satisfactory in form and substance to the Monitoring Agent which the Grantee agrees to
annex to said deed.
(e) Said deed shall be delivered and the purchase price paid(the"Closing") at
the Registry, or at the option of tire eligible purchaser(or the Municipality, as the case may be, if
the Municipality is purchasing the Property), exercised by written notice to the Grantee at least
five(S) days prior to the delivery of the deed, at such other place as the eligible purchaser(or the
Municipality,as the case may be, if the Municipality is purchasing the Property),may designate
in said notice. Tile,Closing shall occur at such time and on such date as shall be specified in a
written notice from the eligible purchaser(or the Municipality, as the case may be, if the
Municipality is purchasing the Property)to the Grantee,which date shall be at least five(s) days
after the date on which such notice is given, and if the eligible purchaser is a purchaser located
by the Municipality,or if the Municipality is purchasing the Property no later than sixty(60)
days after the Municipality's Notice is given to the Grantee,
13
r (f) To enable Grantee to make conveyance as provided in this Deed Rider,
Grantee may if he/she so desires at the time of delivery of the deed,use the purchase money or
any portion thereof to clear the title of any or all encumbrances or interests; all instruments so
procured to be recorded simultaneously with the delivery of said deed.
(g) Water and sewer charges and taxes for the then current tax period shall be
apportioned and fuel value and any common areas charges or association fees, if any, shall be
adjusted as of the date of Closing and the net amount thereof shall be added to or deducted from,
as the case may be, the purchase price payable by the eligible purchaser or by the Municipality.
(h) Full possession of the Property free from all occupants is to be delivered at
the time of the Closing, the Property to be then in the same condition as it is in on the date of the
Grantee's Notice,reasonable wear and tear only excepted.
(i) If Grantee shall be unable to give title or to make conveyance as above
stipulated,or if any change of condition in the Property not included in the above exception shall
occur, then the Closing shall be extended for up to thirty(30) days and Grantee shall remove any
defect in title or restore the Property to the condition required by this Deed Rider, The Grantee
shall use best efforts to remove any such defects in the title whether voluntary or involuntary and
to restore the Property to the extent permitted by insurance proceeds or condemnation award.
The eligible purchaser(or the Municipality, as the case may be, if the Municipality is purchasing
the Property) shall have the election, at either the original or any extended time for performance,
to accept such title as the Grantee can deliver to the Property in its then condition and to pay
therefore the purchase price without deduction, in which case the Grantee shall convey such title,
except that in the event of such conveyance in accordance with the provisions of this clause, if
the Property shall have been taken by a public authority, then the Grantee shall,unless the
Grantee has previously restored the Property to its former condition, either:
(i) pay over or assign to the eligible purchaser or the Municipality, as
the case may be, on delivery of the deed,all amounts recovered or
recoverable on account of such insurance or condemnation award
less any amounts reasonably expended by the Grantee for the
partial restoration, or
(ii) if a holder of a mortgage on the Property shall not permit the
insurance proceeds or the condemnation award or part thereof to be
used to restore the Property to its former condition or to be so paid
over or assigned, give to the eligible purchaser or to the
Municipality, as the case may be, a credit against the purchase
price, on delivery of the deed, equal to said amounts so retained by
the holder of the said mortgage less any amounts reasonably
expended by the Grantee for any partial restoration.
(j) if the Municipality fails to locate an eligible purchaser who purchases the
Property within sixty (60)days after the Notice is given, and the Municipality does not purchase
the Property during said period, the Grantee may convey the Property to any third party,
regardless of income,who may or may not qualify as an eligible purchaser("Ineligible
'14
1 Purchaser"), at an amount that does not exceed the Maximum Resale Price. Upon request of the
unit owner or grantee, the Municipality, acting by and through its Chief Elected Official,shall
issue to the unit owner or a third party a certificate in recordable form(the"Compliance
Certificate")stating that the Municipality has elected not to exercise its right of first refusal
hereunder, This Compliance Certificate may be recorded in the appropriate Registry of Deeds or
registered with the appropriate Registry District of the Land Court and such Compliance
Certificate may be relied upon by the then owner of the Property and by third parties. The
Property sold to an Ineligible Purchaser shall be subject to the continuing obligations and
restrictions contained in this deed rider, so that when the Property is resold by the Ineligible
Purchaser, the sale procedure outlined above must be followed by the selling Ineligible
Purchaser, with the right of first refusal stated above still existing and the restriction of the sale
being to an eligible purchaser. The deed to the Ineligible Purchaser shall clearly state that the
Property is being conveyed subject to this deed rider.
2. Resale and Transfer Restrictions. Except as otherwise stated in this Agreement,
the Property or any interest therein, shall not at any time be sold by the Grantee,the Grantee's
successors and assigns, and no attempted sale shall be valid, unless such sale or conveyance
complies with the following requirements;
(a) the aggregate value of all consideration and payments of every kind given
or paid by the eligible purchaser(as located and defined in accordance with Section 1 above)or
the Municipality, as the case may be, to the then owner of the Property for and in connection
1 with the transfer of such Property, prior to customary closing adjustments for fuel, taxes,or
similar items,shall not be in excess of the Maximum Resale Price for the Property. If the
Property is conveyed to an eligible purchaser, a certificate(the"Eligible Purchaser Certificate")
sliall be obtained and recorded, signed and acknowledged by the Monitoring Agent which
Eligible Purchaser Certificate shall refer to the Property, the Grantee, the eligible purchaser
thereof and the Maximum Resale Price therefore, and state that the proposed conveyance, sale or
transfer of the Property to the eligible purchaser is in compliance with the Deed Rider and the
Regulatory Agreement. There also shall be recorded a new Deed Rider executed by the eligible
purchaser.The Eligible Purchaser Certificate shall certify that the new Deed Rider is satisfactory
in form and substance to the Monitoring Agent. If the.Property is conveyed to the Municipality,
a Certificate (the"Municipality Purchaser Certificate")shall be obtained from the Monitoring
Agent and signed and acknowledged by the Municipality and the Monitoring Agent and recorded
with the Registry of Deeds,which Municipal Purchaser Certificate shall refer to the Property, the
Grantee, the Municipality, the Maximum Resale Price and state that the proposed conveyance,
sale or transfer of the Property to the Municipality is in compliance with the rights, restrictions,
covenants and agreements contained in this.Deed Rider, There also shall be recorded a new
Deed Rider which Deed Rider shall be satisfactory in form and substance to the Monitoring
Agent, If the Property is conveyed to a third party in accordance with Section 1, the Monitoring
Agent shall execute and deliver an acceptance of the Compliance Certificate in accordance with
Section 1; or,
(b) pursuant to Sections 1(b) or 10), the Municipality, acting by and through
its Chief Elected Official,executes and delivers a Compliance Certificate as described in Section
} 1(b)or Section 10).for recording with the appropriate registry of deeds or registry district.
15
i
i
(c) Any good faith purchaser of the Property, any lender or other party taking
a security interest in such Property and any other third party may rely upon a Compliance
Certificate or an Eligible Purchaser Certificate or a Municipal Purchaser Certificate referring to
the Property as conclusive evidence of the matters stated therein and may record such Certificate
in connection with conveyance of the Property, provided, in the case of an Eligible Purchaser
Certificate and a Municipal Purchaser Certificate the consideration recited in the deed or other
instrument conveying the Property upon such resale shall not be greater than the maximum j
permitted price stated in the Eligible Purchaser Certificate or the Municipal Purchaser Certificate
as the case may be. If the Property is conveyed to the Municipality, any future sale of the
Property by the Municipality shall be subject to the Regulatory Agreement and the Deed from
the Municipality shall contain a Deed Rider in form and substance satisfactory to the Monitoring 1
Agent together with an Eligible Purchaser Certificate from the Monitoring Agent.
(d) Within ten (10)days of the closing of the conveyance of the Property from
Grantor to Grantee, the Grantee shall deliver to the Monitoring Agent and to the Municipality a
true and certified copy of the deed of the Property, together with information as to the place of
recording thereof in the public records. 1 ailLlre of the Grantee,or Gwntee's successors or
assigns to comply with the preceding sentence shall not affect the validity of such conveyance.
(e) Notwithstanding anything to the contrary contained in this Deed Rider, the
Maximum Resale Price shall not be less than the purchase price paid by the Grantee which at the
time of purchase complied with the requirements of the preceding deed rider and of the
Regulatory Agreement and which is recited in an Eligible Purchaser Certificate or a Municipal
Purchaser Certificate or recorded/filed with the Registry plus the costs of approved capital
improvements and marketing expenses, as determined by the Monitoring Agent,
(f) The Grantee understands and agrees that nothing in this Deed Rider or the
Regulatory Agreement in any way constitutes a promise or guarantee by the Municipality, the
Monitoring Agent or any other person or entity that the Grantee shall actually receive the
Maximum Resale Price for the Property or any other price for the Property.
3. Restrictions Against Leasing and Junior Encumbrances. The Property shall not be
leased, refinanced,encumbered (voluntarily or otherwise)or mortgaged without the prior written
consent of the Monitoring Agent,provided, however, that this provision shall not apply to a first
mortgage granted in connection with this conveyance for a principal amount less than the price
approved by the Monitoring Agent in the Eligible Purchaser Certificate,or the Municipal
Purchase Certificate. Any rents, profits,or proceeds from any transaction which has not received
the prior written consent of the Monitoring Agent shall be paid to and be the property of the
Municipality for deposit into a fund for affordable housing. In the event that the Monitoring
Agent, in the exercise of its absolute discretion, consents to any such lease, refinancing,
encumbrance or mortgage, it shall be a condition to such consent that all rents,profits or
proceeds from such transaction which exceed the carrying costs of the Property as determined by
the Monitoring Agent in its sole discretion shall be paid to and be the property of the
Municipality for deposit into a fund for affordable housing. Notwithstanding the restrictions
outlined in this paragraph, any Property purchased by the Municipality, under its Right of First
Refusal,may be rented by the Municipality, at its discretion, so long as the income limits for the
lessee household do not exceed the Base Income as defined in the Regulatory Agreement. Funds
16
1
1
received b a Municipality under thisparagraph shall be deposited in an affordable housing fund
Y p Y
to be used by the Municipality to support other affordable housing within, the municipality.
4. Rights of Mortgagees. (a) Notwithstanding anything in this Agreement to the
contrary,but subject to paragraph 4(b)of this Agreement, if the holder of record(other than the
Grantor or any person related to the Grantor by blood, adoption,or marriage, or any entity in
which the Grantor or any related person has a financial interest(an"Interested Party")) of an
eligible mortgage granted to a state or national bank,state or federal savings and loan
association, cooperative bank, mortgage company, trust company, insurance company or other
institutional lender or its successors or assigns (other than an Interested Party)shall acquire the
Property by reason of foreclosure or similar remedial action under the provisions of such
mortgage or upon conveyance of the Property in lieu of foreclosure, and provided that such
holder has given the Monitoring Agent and the Municipality not less than sixty(60)days prior
written notice of its intention to foreclose upon its mortgage or to accept a conveyance of the
Property in lieu of foreclosure, the rights and restrictions contained in this Agreement shall not
apply to such holder upon such acquisition of the Property, any purchaser(other than an
Interested Party)of the.Property at a foreclosure sale conducted by such holder,or any purchaser
(other than an Interested Party)of the Property from such holder, and subject to the disposition
of proceeds established in Paragraph 4(b)of this Agreement such Property shall thereupon and
thereafter be free from all such rights and restrictions. For purposes of this Deed Rider all
eligible mortgage shall be a first mortgage encumbering only the Property and in all original
principal amount not to exceed ninety-five (95%) percent of the sale price stated in the Eligible
Purchaser Certificate, or the Municipal Purchase Certificate recorded with the mortgagor's deed.
Any foreclosing,mortgagee holding a mortgage which is not an eligible mortgage,shall not be
entitled to the protections of this section and shall be deemed to be an owner subject to all the
restrictions and obligations of an owner under this Deed Rider.
(b) In the event such holder of an eligible mortgage conducts a foreclosure or other
proceeding enforcing its rights under such mortgage or if the Property is conveyed to such holder
in lieu of foreclosure and the Property is sold for a price in excess of the greater of(i) the sum of
the outstanding principal balance of the note secured by such mortgage plus all accrued interest
and all reasonable costs and expenses which the holder is entitled to recover pursuant to the
terms of the mortgage and(ii)the Maximum Resale Price applicable on the dale of the sale,such
excess shall be paid to the Municipality in consideration of the loss of the value and benefit of
the rights and restrictions contained in this Deed Rider and held by the Municipality and released
by the Municipality pursuant to this section in connection with such proceeding(provided, that
in the event that such excess shall be so paid to the Municipality by such holder, the Municipality
shall thereafter indemnify such holder against loss or damage to such older resulting from any
claim made by the mortgagor of such mortgage to the extent that such claim is based upon
payment of such excess by such holder to the Municipality in accordance herewith, provided that
such holder shall give the Monitoring Agent and the Municipality prompt notice of any such
claim and shall not object to the intervention by the municipality in any proceeding relating
thereto). In order to determine the Maximum Resale Price of the Property at the time of
foreclosure or other proceeding,the Municipality shall consult with the Monitoring Agent, and
the Maximum Resale Price shall be equal to the price as determined by the Monitoring Agent
under the definitions set forth in Section 1. of this Rider. To the extent the Grantee possesses any
interest in any amount which would otherwise be payable to the Municipality under this
17
paragraph, to the fullest extent permissible by law, the Grantee assigns all its interest in such
amount to said holder for payment to the Municipality. Funds received by a Municipality under
this paragraph shall be deposited in an affordable housing fiend to be used by the Municipality to
support other affordable housing within the municipality.
S. Covenants to Run With the Property,. (a) The Grantor and the Grantee,for good
and valuable consideration, the receipt and sufficiency of which is acknowledged, grant and
assign to the Municipality,the Municipality's agents, successors, designees and assigns the right
of first refusal to purchase the Property as set forth in this Deed Rider,and to the Monitoring
Agent and the Municipality the right to enforce the rights and.restrictions,covenants and
agreements set forth in this Deed Rider. The Grantor and the Grantee grant to the Monitoring
Agent and the Municipality the right to enter upon the Property for the purpose of enforcing any
and all restrictions,covenants and agreements contained in this Deed Rider, and of taking all
actions with respect to the Property which the Monitoring Agent and/or Municipality may
determine to be necessary or appropriate,with our without court order, to prevent, remedy or
abate any violation of the restrictions,covenants and agreements set forth in this Deed Rider.
The rights granted to the Monitoring Agent and the Municipality shall be in addition to and not
in limitation of any other rights and remedies available to the Grantor or the Monitoring Agent or
to the Municipality for enforcement of the restrictions, rights, covenants and agreements set forth
in this Deed Rider. It is intended and agreed that all of the agreements, covenants, rights and
restrictions set forth in this Deed Rider shall be deemed to be covenants running with the
Property and shall be binding upon and enforceable against the Grantee, the Grantee's successors
and assigns and any party holding title to the Property for the benefit of and enforceable by the
Monitoring Agent and/or the Municipality,the Monitoring Agent's and/or Municipality's agents,
successors, designees and assigns for a period equal to the term of years required under the
Comprehensive Permit Decision, dated May 24, 2002, as the same may be amended from time to
time(the"Comprehensive Permit Decision'),unless one of the following events occur: (i)the
recording of an Eligible Purchaser Certificate, which includes a new deed rider both in a form
and substance satisfactory to the Municipality; (ii)upon the conveyance of the Property to the
Municipality and the recording of a Municipal Purchaser Certificate in a form and substance
satisfactory or as otherwise permitted by this deed rider or as otherwise permitted by law; or, (iii)
upon the acquisition of the Property by reason of foreclosure or similar remedial action under the
provisions of such mortgage or upon conveyance of the Property in lieu of foreclosure in
accordance with Paragraph 4 above(collectively, the "Term"). The Monitoring Agent shall be
entitled to a fee of three-fourths of one percent of the Maximum Resale Price of the Property to
the Municipality or an eligible purchaser or an ineligible purchaser in accordance with tire
provisions of this Deed Rider and the Regulatory Agreement for the services performed
according to the Monitoring Services Agreement(and referenced in the Regulatory Agreement),
This fee shall be paid by the Grantee as a closing cost at the time of closing, and payment of the
fee of the Monitoring Agent shall be a condition to delivery and recording of its certificate,
failing which the Monitoring Agent shall have a claim against the Grantee and persons claiming
under the grantee for which the Monitoring Agency may seek an attachment against the
Property.
(b) This Deed Rider and all of the covenants, agreements and restrictions
contained herein shall be deemed to be an affordable housing restriction as that term is defined in
G.L. c. 184, § 31 and as that term is used in G.L. c.184, § 26, 31, 32 and 33,subject to the
18
5
conditions contained herein, This Deed Rider is made for the benefit of the Municipality, and
the Municipality shall be deemed to be the holder of the affordable housing restriction created by
this Deed Rider, The Municipality has determined that the acquiring of such affordable housing
restriction is in the public interest. Further, the Resale Restrictions contained in this Deed
Riders which are to encumber each of the Affordable Units at the Project shall also constitute an
affordable housing restriction as that term is defined in G.L. c. 184, § 31 and as that term is used
in G.L. c. 184, §§ 26, 31, 32, and 33, subject to the conditions herein. Such Resale Restrictions
shall be for the benefit of the Municipality and the Municipality shall be deemed to be the holder
of the affordable housing restriction created by the Resale Restrictions in each of the Deed
Riders. The Municipality has determined that the acquiring of such affordable housing
restriction is in the public interest. To the extent that the Municipality is the holder of the Resale
Restrictions to be contained in each of the Deed Riders, the Director of DHCD by the execution
of the Certificate of Approval attached to and made a part of the Regulatory Agreement hereby
approves such Resale Restrictions in each of the Deed Riders for the Low and Moderate Income
Units of the Project as required by the provisions of G.L. c, 184, § 32.
(c) The Grantee intends, declares and covenants on behalf of itself and its
successors and assigns (i) that this Deed Rider and the covenants, agreements, rights and
restrictions contained in this Deed Rider shall be and are covenants running with the land,
encumbering the property for the term of this Deed Rider, and are binding upon the Grantee's
successors in title, (ii)are not merely personal covenants of the Grantee,and (iii) shall bind the
Grantee, its successors and assigns and enure to the benefit of the Municipality and their
successors and assigns for the term of the Deed Rider. Grantee agrees that any and all
requirements of the laws of the Commonwealth of Massachusetts to be satisfied in order for the
provisions of this Deed Rider to constitute restrictions and covenants running with the land shall
be deemed to be satisfied in full and that any requirements of privity of estate are also deemed to
be satisfied in full.
(d) Without limitation on any other rights or remedies of the Grantor, the
Monitoring Agent, the Municipality, their agents, successors, designees and assigns, any sale or
other transfer or conveyance of the Property in violation of the provisions of this Deed Rider,
shall, to the maximum extent permitted by law,be voidable by the Municipality or the
Monitoring Agent, or their agents, successors, designees and assigns by suit in equity to enforce
such rights, restrictions, covenants,and agreements,
(e) Notwithstanding any other provision in this Deed Rider, after the end of
the Term(the "Termination Date"), the then owner of the Property then subject to this Deed.
Rider may sell the Property at a price equal to the fair market value of the Property as of the date
of sale and not subject to this Deed Rider,provided, however that the owner, at the time of such
sale must pay to the Municipality the difference between the fair market value as so determined
and the Maximum Resale Price which the owner could realize in a sale to an Eligible Purchaser
were this Deed Rider to have remained in effect, and upon such payment the Property will be
deeded free and clear of this Deed Rider, In the event of any failure of any owner to make a
payment under this Deed Rider the Municipality shall have the right to seek payment from the
Purchaser of the Property,and his/her successors and assigns, which right shall be prior to the
encumbrance of any mortgage upon the Property. The owner of the Property after the
19
i
ss
On this day of 2004, before me, the undersigned notary public,
personally appeared proved to me through satisfactory evidence of
identification, which was 0 driver's license, 0 personally known to me, or❑personally known to
3`d party witness personally known to me, to be the person whose name is signed on the
preceding or attached document, and acknowledged to me that he signed it voluntarily for its
stated purpose as Manager, for , LLC, a limited liability company.
Notary Public
COMMONWEALTH OF MASSACHUSETTS
ss
On this day of_ , 2004, before me, the undersigned notary public,
personally appeared proved to me through satisfactory evidence of
identification,which was 0 driver's license, 0 personally known to me, or 0 personally known to
3`d party witness personally known to me, to be the person whose name is signed on the
preceding or attached document, and acknowledged to me that he signed it voluntarily for its
stated purpose as Manager, for ,LLC, a limited liability company,
Notary Public
22