HomeMy WebLinkAboutC09-478 Riverview and Dougherty Mort LLPA(;RE;E?~Ih;N"i' I3I?'t'~~%F:h~N I~l~'Es;liVlt~;W APAR'('ME;~'>fS PItESh:1~VA'I'CON L,P AND
Ut?t~Gili?It-I'1" ;~1t:)ll"1'GA(;I++'. [,I,(:`
"t'IIIS A(;REEMENI' ("agreement"), s:1:~lcctivc t11~ 8th ~11y cif l.~ecemher ?009, is between
Riverview Apasvnents Preservation LI', a limited partnership orgsu~ired under the laws of the
State of Colorado or its assigns (the "C't:arl~~oration") and Daugherty Mortgage t_L,C', a limited
liability compasiv organi~.ed under the taws i~f the. Slate of 1:)elaware with its principal place of
l~~u;~~s~ess sot hlinneapo-is. Ivlim~ue~ota ("`('attsultsunt••}.
~~' 1'I''ti F~;SS!?`1'I I
~~l[I~.I2I±;AS, C'orporatiou desires to obtain aunstructiort and permanent financing for the
substantial rehabilitation of the F~agle Riverview Apartments (tlae "Project"'), located in (:agle
~: aunty. Colorado, w°ith mort~,age insurance issued by the I~edcral I iousirs~; Administration
("[~ I IA•`) pursuant to Section 2? 1(d){~} cif the rational I lousing Act ("`section ?? 1 "); and
WtIF,t~EAS, Consultant is authorized to do business in tl~tc State af•C'olorsuio tu~ul ltas exl~~eriencc
and exl~ertitir in under~vu-itisig .ua~i fundin~~ Sec•tiasu :'_? 1 isist,ircel lostns: and
VVllt~;tt.l~:AS, Corporation seeks cons'truactian asul pe*.rmas7c.nt fint~ssicirs~? k~ar the Project in the
sun+~unt of•al~~pro~imatel} $8.'00.000 ('the "Loan"): surd
~b'}il;Rh:AS, C'arporation and Consultant intend by this Agreement to set ti~rth the sec?pe of
responsibilities of (''onsultant in connection wish the Prajcct and related terms and conditions to
govern t}~ue relationship beaween <:'osusultant and (_'orporation in connection with this Agreerncnl.
N01~', `I`t-Ik:REh,C}RI:~- irs consideration of-the foregoing pres~~tises sand The fu7lloti4~ing ps•s'~mises,
C'i~s°psn-ation sart~l Cortsultatut a{~rce as 4:~>Ilows:
SC'QI'1~: C)~' ~~~O(th: The follawint~ ~~~ill collectively be relerrcd to as the "Vdi~rk'", which is
tiurther defined in I~:rhibit A, the Project Processing Sumurury, :attached hereto:
1. ~'~'{)RK: APt'I,ICATIOV PRO('I~.tiS
r'~. Complete an initial underwriting and sunalysis of•the Project and provide
recommendations regarding the Section ?? I supplication ts~~ be submitted to I'1-iA.
l3, i'rclrus-e liar, schedatle, sutaii conduct apse-sspplicsttitun conf~,rence, if required.
C'. Prcparu~~ a~aplicsttians ii~r pre-application and!t~r lirs~n con7mitmcnt ota applicable
forms and asscmbic s-elated exhibits for Corparatioru's review.
1). [ -pan receipt of the Corporation's approval, submit. the Section '?Z 1 application to
FI ia.
l?. Maniti~r application duritag its processing and underwriting period.
f~. F'ro~~ide folliwv-up with the. C'orporatiun during the processing, period.
Chi. Seek t<:> assist arcl~iteet, contractor, stttorncys, surveyor and title; a~~rnt as
necessary.
~q" , ~~~'
2. W'Ol2K: I~SU:~NCl~: Ol~~ hlltil C'OVIi<91'l`itiIF,N"T, IZA"I'h: LOCK,
Upon complcti<uz ol~ Ioan procc:;sing. it is anticipated tl~utt !~"I~IA will issue a firm conuuitment
(`l~irttt C.'otnntitt~~ent°") t« C~~nsttltant tt> inst.tre t}1e m~~~rtgage loan on the Project. Following
issuattc~ c>i zt } irrn C'ontrttitrt~c~crt, the Coztsultant will l~ro~idt:: the following set vices:
A. °~nalvr.c the Firm C.`rtmmitmcnt.
I3, Pr<>vidc advice. guidance and assistance regarding the terms atui cotiditio-ls of~the
firm Connnitmc.tit., including appropriate strategy to seek to appeal or modify any
unacceptable underwriting or closing reyuircments.
C. Obtain avai(ahle financing terms, based upon the processed interest rate. the then-
prc~~ailing market interest rate and the prepayment ~~tption the (~'orpuratiun selects.
D. Prepare req>,tircd clc>sing documents and expedite closing.
1. deck to close at~d fond tl~e l.~an.
1~. `~crvicc the l.ottrt.
L.il~tot~ issu~u~ce of the firm Commitment, Consultant will rrlake a good-faith effort to obtain
financing terms for the construction and permanent loan w°ithin b0 days. All financin;, terms are
subject to Corporation`s rep iew and consent. Immediz-tcly° prior to "lucking the rate" on t}~e
financing, Corporation ~'`°ill be roduired to post agood-taith doposil (as des~ribod in k~,~hibit A),
which ~~-ill be returned to the Corporation after closing and delivery of the C:rinnic Mac mortgage
hacked security ("t;NR~~tA ~~1E3S") to the investor.
C'i~rporatic~n tuulerstarzds and agrees that interest ratis flucttaate periodically b4tsed upon zrtarket
conditic~r~;~ and that the processed interest rate cont;tirte.d in the firm Commitment may or rtaay
riot be <:t n~~zarhei rate at the. titz~~+: the Cortst~tPtaztt locks the rate ol~the ltttzn. If tlic procctss4d interest
ratck is It wee than the then-prc~-wiling market rate, ('urporation may either instruct Cor-stiltant to
re.-process the Firm Commitrncnt at the then-prevailing -7larkct rate or pay any necessary
discount redizired fur the lo4ver processed rate, which discount ~ti-ill he payable at the time of
closing.
Cunsultatit shall have the exclusive right to fund the firm Commitment once issued fir f~U days
after said issuance.. unless the Firm Commitment is extended by the ti.S. Departrncnt o(`ffousing
and t.lrban L)evelo}?mcnt ("IIL I)"}.
"['°hc C:'onsultattt sltt~~ll tae entitled t.o Iee for the Work only as expressly provided herein ztnd
subject tt'~ this followin<~.:
(1) A $2,~O1) processing fee (.`Processing Fee"). which is a non-rc:I'~undablc retainer
tee for staff time and out-ot=pocket expenses incurred in connection with the;
processing of the C'orpvra[ion's loan application for the Project, and it is pay~~tble
upon nu~ttual execution of the Agreement.
(2} Financing and placement lees ("financing and Placement fees"), in the: amount o1~
one percent t 1.00"ro) and testy one-hundrrdths percent (.q0°io), respectively, of the
amount of the I~ isle Calllmli.inc;tll, in cr-mpc nsatian for consulting services in
obtaining tile- Firth (_~111rilnltmenl and for cli~sing the lawn. "hhe Financing and
Placement Fees shall be payable whoa the Loan closes.
(;} :~ "I"crnunation l,ee t.~f $25.000 shall be due and payable within 90 days o#~
termination of the lawn Iari.~c:essing in the Lveatt the (~,orporation elects to terminate:
the transaction alter the (ism canunihnent application has been submitted to I It.:I~.
~. L.IMI"TATIOi`~' OF" tih;I2Vl('I?S TO RG: PIZO~'IDF,U I3Y CONSItL"fAN'I'
the scope olservices tc? be provided by ('onsultant hereunder is limited to the matters covered
by the Agreement. It is agreed that neither the C"arporation nor the Consultant shztl] engage in
at~y lobbying activities, directly or indirectly, to iniluencc I Il_Ii) or hHA in ally manner
concerning the Project.
5. E:lCI.LSI~'11'ti'
The Corporation agrees that Consultant shall have the caclusive right to provide mortgage
insurance. processing services with rcg~trd to the Application for mortga~~e insurance to be
sLIbIllUted te) Ht)D In C:OIll7eCtlOt1 wltll the Pl'atCCl ~U1CI la clasC and (Ulld the Laan pIIrSUa11[ l0 lht
terms set Earth herein. "I'he term of this Agreement will expire on the earlier of (i) the date of
initia} endorsement of mortgage it~surancc or (ii) November 1 1, 2010.
G. CONFIUI:N"hIA1,1"1~1'
1"he Cot-horation hereby approves and authorises Consultant to obtain financial statements, credit
reports, and background checks an Corporation and affiliated entities and to provide copies oI~
the same to H[JD or FI IA in connectiim with its processing of the Section 22 I application, as
required. Except to the extent required by IltJl) or FHA for processitlp,. all nun-public
information given to Consultant by Corporation or given to Consultant through third parties in
response to requests about ('e~rporGttion shall be treated as can(idetltial ~tnd will nc'rt be used for
any purposes other than the, perlortnance of the Work provided herein. The Consultant and
Corporation ~tcknowledgc that, during the term olthis Ag,reemcnt and in the course oCthe
Consultant rendering the Consulting Services, the C'e'msultattt tnay acquire kncawledge of the
business operations oCCttrporation to the paint t}~utt the general method o:ldoing business, the
pricins; of• products.. the lists of customers and other aspects e}f the business affairs of Corporation
("Can(idential Information"') tnay become generally known to Consultant and the Consultant.
shall not disclose, use, publish, cu otllerw•ise rcvetil (except in the course of properly satisfying
Consultant"s duties here;under), either directly or through another, to any person, firm or
corporation, any Confidential Information and Shall keep such Citnl3dential Infix•mation
confidential for a period o'f tllrcc (3) years following termination oi~this Agreement.
Notwithstanding the foregoing, the term Confidential lnformalion shall not include. information
that (i) is novv in the public domain, ur that later enters thr public domain, through na action by
Consultant in violation oCthis Agreement; or (ii) Consultant can dcmonstratc was already in its
possession on anon-confidential basis at the time outs disclosure hereunciet; or (iii) becomes
available to Consultant on a nun-confidential basis trom a source other than Corporation,
provided that, such source was not. bound by an obligation of confidentiality to Corporation; or
(iv} is approved fur disclosure; or release by written authoriz~:-ti~~~n~ from Corporation.
7. CUh~1~~1H;NCh;MN;N"I' AND (~`UMPI<E"I'IC)N Oh THE WORK:
C:'ansultant shall commence the Work prior to or promptly after esecutie--~ oC this Agreement by
beach parties, "fhe C'onsultant's and C'orporation's intent is that the Work sl~l~-ll be completed and
a 1~~ir-a~ C`onullitment with terms acceptable to Ciarporati-an, as further set Ii,a--th in I~;xhibit r~, shall
be issued by NUD on ar be Core April 15, 2010 (the "(.~carnpletion Date"), iCpassiblc, while
recognizing that -1~any events arc outside thr Consultant's control. Consult~u~t agrees to notify
Corporation if aehicvernetat of the Completiian Date or terms as set t~'arth in Exhibit A appear
unlikely as soon as it so appears to the Consultant. ~1'hcreupon, Corporation and Consultant will
meet to discuss the reasons Cor del<~-y and means of achieving timely' completion. C~'o-asultant will
use its best efforts to ~-chieve timely am~pletion.
191SC'h,I,LANI';OL`ti:
A. No Commitment to Lend. 'I~his Agreement is not and shall not be
construed as ~- commitment to (end. Anv such commitment to lend shall
he the subject oCu separate cex~unitment Iolluwiug isst-ancc of the Firm
Cnmmitment, and shall reflect the requirements of I-IUD i-r h'I fA and the
Consultant fur closing and funding of the Loan, including the rate-lock
arrange-nents which have been agreed to by the Corporation.
I3. Governing [,aw xnd Venue. "[his Agreement shall be ~.;overned and
construed in accordance with the laws of Cole+rado. 'l~he parties agree to
tl~-c exclusive jurisdiction and venue oCruurts located in f;agle Count},
Coli~rado toe any action arising out or related to this Agreement.
C. Limited Representations rc Loan Closing. "The Corporation
unde-stands, acknowledges, and agrees that_ (i) Consultant has not made
any representations or wan~~uaties regarding the results of I IUD or I~~I [A
nuartgage insurance processing and (ii) the `I~urget Interest Itatr and "I"argot
Loan Amount set forth in 1',xhibit A rcileet the Loa-- amount Consultant
reasonably believes }-IUD or hIIA will be swilling to insure given the
intornu-tiean C'orporataon has provided to us, market area data currently
available. to Consultant, tl~ae criteria ger-erally applied by 1ilJD or [~HA in
determining an insurable mortgage ue-dcr Section 221, and the interest rate
environment prevaili-~g as oi'this data. While Consultant will t-sc its
skills, expertise a.nd hest cl~forts to ubtuirt a firm Cornn~-itmcnt satisf<-ctory
to Corporation, Consultant cannot promise, or otherwise assure
Corporation the-t Consultant will be successful.
l). (.'orporation to Provide InTormatic-n. 'l~hc Corporation understands that
Consultant will rcl}~ ul~aon the fG-ctual stG-tcments and other information
provided by C'orpearatiora in the processing of the Application ~~rnd hereby
al~f'irms that all na~ate--ial inlorrnation .~-nil sty-ternents heretofore given. (aaui
tv be provider{ heee.~-ttcr) ~~-re (or will hc) true, cvmplcte and accurate as <aI~
the date of the submittal oC sarlle tct the best of the Corporation's
kno«•ledge. The Corporation further agrees to notily Corpi~ration in
writing itrnnediatcly of any material change. in the information provided to
Consultant.
C'onsultant's Right to Retain and Pay Otherti. Corporation
acknitwlcd~c~s and agrees that C'onsultatlt reserves the right. in its scale
fhsct•ettc~n, t« pro~'tde addllional CclmpenSafloll tU any n1aCkCterS,
originators, ctr broker, ~~~ith regard to financing the Projeca ttt Consultant's
e~;pense.
a?31ndln~; oft f1tICC4'ti!it)l's aMi<3 Asslglls, ~ IIIS 1'~~,reetll:ilt, atld the 1'tt;llts at1d
ol)Il~atlt>nS Create,Cl 1'1CrebY', shilll be oln(h11~ Upo11 aI1Cf Inut'e tl.) the benefit
of t'o1•poration atld Consultant arxi their resprcti~•e suecessors and assiLrls.
Nothing herein cxl~tressed or implied is intcndeci or should be a}nstrued to
confer or give to any person or entity other than Corpcn-anon or Consultant
a11c1 their respective successors and assigns, any right, remedy or claim
and<.r or by reason ht:ri:of or by reason of arly cove Want or condition herein
ccyntaincd.
Ci. 4c~~~erability. lf•any portion of this Agrcentent is held im~alid ctr
unenforceable for any reason by a court of•competent jurisdiction. such
portion shall be deemed severable and its invalidity ur its unen(orceatlility
shall not affect the remaining provisions; such renlaiuing provision sha11
he fully severable and this Agreement shall be construed and enforced as
if such invalid provisicln had never been inserted into this Agreement.
f 1. ~~mendment and Integration. ~l•his Agrc;enlent tllay be all~lcnded.
IIIC~CIItteCl, e11t1Tl~td, OX' Il'CClllilated 111 \vhOle ~k[' lll pact only bS~ ~~'rltletl
a~~:reetlle-nt dul}` authoriecl and executed by both f.'orporatian and
('culsultant. "1•hi~; Agr~eernent represents tltc full allcf co111plete
undi~rstandin~; ~~f <'tlrpor<:Ition and C'onst.-Itant. ~~uld s11pe1scdcs any prier
agrcetltents, discussions, negotiations, rcpt-c:sentations or understandinfTs
t}f•C'orporationrmld Ce~tnsultatlt with respect tct fhe subject [natter' cc>nt< ittcd
herein.
"I~•errr~ination. C•orporatian or Consultant. nlay° terminate this Agreement.
itl ti~°hol~: or in part, liar ~Iny reason, at ,xny time, with or r~ ithout cause.
up~~~n providing ten (1Oj clays ru>tice to Consultant. If Corporation
terminates this Agreement, Corporation shall be liable for Services
satisfactorily completed by Consultant prior tv the notice. If~C'onsulttult
terminates this Agreement prior to coutpletion of the ~~~ork, Consultant
shall return the $?,SUO Yrocessin~; Fee.
;fit ail tines during the team i>f t}ris Af!,reement. (';onsLlltant shah maintain cou~tnercial genera}
liability insurance in the mirtimunt anlt:IUnt iIl'one millic~~rl doiiars (`~+1,OC}O,(')O(?} her oceurr~nce.
and the. t~~xinimiltt~i aggregate tat~ic~ttnt of• ttivo miliion dl~~llats ($2,f)t)O,Ot)0).
}O. CVO"['}<`E A\C) :~.~~`1'EIOItiL1~;1) tilt:9'Kl~,`i1~;N'I'r1"f'IV1~:~;
-any notice and tall cc~I~~nttnicatiol~s rcciuircd under this .Agrc4tner-t shall be given in ~~riting by
per~~>nai tieCivery, ia.~, or mail to the appropriate party at the ii>lluuinti~ addresses.
li~:l i'otentc. I:.sq.
Consultr-nt:
~+amucl .I. }3utler
E~~.agle County C~rovernrnent })oug;hcrty Iy~lortgage LL,C
i~epartlrlent of• }lousing and I)eveloprnent 161 ~ StJm[Illt r\ti•enue
>t)() }3roadi~•av
~ Suite ? 1 1
}'.t.}. I3ox 8~+t) Dort Worth, fX 7(1102
}~-ag}e, C'c~>loraciq 8l fi> l (817) >32-360O (phut~e)
(i~)7O) .i~?8-868 (phone) 1817) 332-361 1 (tax)
{~?701 328-$787 {tax}
tiotice.s shall be deemed given on the date ofde(ivery or three days after the postmarked date of
deposit, first class postage hre~.-id, in an ~~(~ticial depositary of•the l ~.5. Postal Service.
7'flf~: 1~l„t-1~21;'4'L11:h O1~~ I'.~IG~ Ih'TI~;N77Or'~,4L1.}" 1.1;'l~°L' U1.,-1.Nla~
IN ~w'[`I"NI~SS ~'I IL:IZI:~.OI~. C'C71ZI'C)IZ11~1'ION and C'(:)N~l lL"I~~'~N1~ have executed this
r'~~reemcnt as of the d~it~ first ~~ritten above.
RIVIRVIIVt' IaPAR'1~~-1ENTS L.P. I?v and
through its General Aartner
IZ1VIiRVI1~.V1' :~P:~R'1~~9ENI'S
PRI~,SF.hV~'1"C~[~)N L1,C. by and though its
sole member
1=~f~t;t,l; COtiN"I~Y I t)I~SItiC; ANI)
I)F,b'h,I.t)P11~1I;NC :~l'.I~IIURI~I~Y
.~-
i i Y : M~_ ~ / _CtUC~.~
Sar<~ ,I. I isl~er
I~)<,)I~~GIR`l'Y ~9C)I~`ht:;AC~FI? I.I.t
`~. _~W
1:3y: l ~: f _ --..-_.
Paul ~'cissrtlan
Senior uiCC. President
EXHIBIT A
PROJECT PROCESSING SUMMARY - 2Z1(d)4 SUBSTANTIAL REHABILITATION
Client:
P_r~ect Characteristics:
Narne:
t:ity/state/zip:
No. of Units:
Estimated "As-Is" Value
Estimated Laan Amount
Targe4 Interest Rate
Est. Construction Loan Term:
Permanent loan
Amortization and Term:
FHA Insurance Program:
Assumed Prepayment
t7ptior~:
Security
Non-Recourse Loan:
Assumption:
FHA Appticatian.Fee:
FHA Inspection Fee.
FHA Insurance Premium
Eaf;le Riverview Affordable Housing Corporation
Riverview Apartments
Eaf,le, Ct)
72 units
$6,500,000 -subject to appraisal confirmation
$8, 500, 000
5.85ib construction and permanent loan rate includes loan servicing but
exciudet; the annual FHA Mortgage Insurance Premium of 0.45%.
18 months
40 years
Section 222(d)(4) Substantial Rehabilitation of the National Housing Act.
Three-year prepayment lock-out from the comrrrencement of amortization.
Thereafter the Loan can be repaid with a prepayment penalty of 7°l. in the 4'"
year, declining 1%, each yt:'ar" khereaft.er <~,nd reaching 0% after the 10`'' year,
They Target Interest Rate assumes this prepayment option. Final prepayment
option will be determined at time of rate lock.
The Loan shall be secured by a first mortgage lien encumbering all land and
improvements constituting the Project, and a security agreement and financing
statements encumbering all personalty.
The Loan will be non-recourse.
The Loan is fully assumable subject to FHA's and Consultant's approval.
$3.00 per thousand at Firm Commitment Stag<~. Thar Application Fee must be
advanced by the Corporation, but is included in Loan proceeds and
rcimbursablc at Closing.
A fee equal to one half of one percent (Q50`%) of the Loan amount, payable at
Closing and is included in Loan proceeds.
Construction Loan: 0.90%, of the. average outstanding principal balance of
which 0.45~h of the loan amount is payable at Closing and included in Loan
proceeds.
~i
Permanent Loan: 0.45% of the average outstanding principal balance payable
annually in advance via monthly escrow payments which commence. at
construction completion.
Technical Report fees: If the Loan is processed under FHA's "MAP Program" the Corporation will be
required to pay for an income/expense analysis, market study, Phasc I
Environmental Site Assessment, architectural plan review, construction cost
review, firm application appraisal, ALTA survey and credit reports before
submitting the application (Pre-Application and Firm Application! to FHA. Third
party costs are estimated at $19,500 for Pre-Application and $16,500 for Firm
Application. The Consultant recognizes that the Corporation has already paid
consultant $19,600 to engage an appraiser to prepare an income/expense
analysis and market study and appraisal and $7,700 for Phase I, HUD 412$
Report, and Lead i3ased Paint Testing.
Processink Retainer- Anon refundable retainer fee in the amount of $2,500 payable to Consultant at
the time of execution of the Agreen~rent.
Financing and Placement Fee: A fee estimated at one hundred forty one hundredths percent (1.40'%) of the
loan amount set forth in the FHA Firm Commitment, due to Consultant as
compensation for arranging the construction and permanent financing and
making the Loan. This fee is separate from any Discount, is payable at Closing
and is included in Loan proceeds.
Discount: The amount required either to buy down the interest rate or to place the loan
at the then prevailing market interest rate and the Prepayment Option
selected by the Corporation.
lender's Counsel Fee
And GNMA Costs of
Issuance: An estimated fee in the amount of $30,000, payable to Consultant for
Consultant's legal expenses associated with closing the loan and an estimated
fee in the amount of $1,900 payable to Consultant for GNMA costs of issuance.
These fees will be payable out of the Financing and Placement Fee at Loan
Closing.
Termination Fee: A fee in the amount of $25,000, payable to Consultant for Consultant's services
in the event that the Corporation chooses to terminate the processing of the
loan after the Firm Commitment Application is submitted to HUD.
Good Faith Deposit: An amount equal [0 0.50% of the Loan amount set forth in the FHA Firrn
Commitment, required to secure the permanent financing at time of rate-lock.
The Good Faith Deposit will be held by Consultant and will be returned to
Corporation after Closing of the loan and delivery of the GNMA MBS to the
investor.
Patriot Act Verification Notice
Important Information About Opening Flew Account And/Or Entering into a Business Relationship with
Consultant: To help fight the funding of terrorism and money laundE~ring activities, Fc=_dera! law requires all
financial institutions to obtain, verify and record information that identifies each person or corporation who opens
an account andJor enters into a business relationship.
