Upper Langley HOA Deed Restriction on Transfer or Sale of Lot including Capital Improvements for Non Income-Qualifying Lots
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1 Attn: Jerene Upper Langley, LLC 833 Suzanne Court Langley, WA Upper Langley HOA Deed Restriction on Transfer or Sale of Lot including Capital Improvements for Non Income-Qualifying Lots 1 INTENT: It is the understanding of the parties that the terms of this agreement, and in particular of this Article, are intended to preserve the affordability of the Lot, to be defined as specifically the plot of land shown as a building lot on the Upper Langley final Plat as recorded in the records of Island County, and any buildings and dwellings built thereon, as deed-restricted for the purpose of expanding and maintaining access to affordable homeownership opportunities. 2 TRANSFER TO OWNER S HEIRS: Upon (i) receipt of notice from Owner, or (ii) receipt of notice from the executor of the decedent s estate given within ninety (90) days of the death of Owner (or the last surviving co-owner of the Lot), UPPER LANGLEY HOA shall, unless for good cause shown, consent to a transfer of the Lot and an assumption of this Deed to and by one or more of the possible heirs of Owner, subject to disposition by will or by state law. Accompanying the transfer must be a Letter of Stipulation and a Letter of Acknowledgment of legal counsel setting forth the heirs review, understanding and acceptance of the terms of the Deed, which must be submitted to UPPER LANGLEY HOA to be attached to the Deed when it is transferred to the heirs. If the gift or devise contemplated by this paragraph shall fail for any reason, then the UPPER LANGLEY HOA s Purchase Option of this Paragraph 5 shall govern the sale of the Lot. 1 Dec 29, 2016
2 3 OWNER S NOTICE OF INTENT TO SELL: In the event that Owner wishes to sell its Lot, Owner shall notify UPPER LANGLEY HOA, in writing, of such wish in form and substance similar to that of Exhibit A, Notice of Intent to Sell. Such Notice shall include a statement as to whether Owner has identified a prospective, qualified Buyer as of the date of the Notice. 4 UPPER LANGLEY HOA RIGHT OF FIRST REFUSAL OPTION AND AGREEMENT TO COOPERATE: Upon receipt of an Intent to Sell Notice from Owner (Exhibit A), UPPER LANGLEY HOA shall have SIXTY (60) DAYS after postmark or personal delivery of the notice in which to exercise the Right of First Refusal by purchasing the Deeded Premise directly, or by bringing a Income-Qualified Person with an offer acceptable to the Seller, or with an offer whose terms are identical to those stated in the Notice, and who furthermore then complete the purchase of the Lot within the required period. Closing of the sale will follow within SIXTY (60) days after this Notice. The time permitted for the exercise of the Right of First Refusal Option may be extended by mutual agreement of UPPER LANGLEY HOA and Owner. 4.1 UPPER LANGLEY HOA shall notify Owner in writing within TEN (10) DAYS of receipt of the Notice of Intent to Sell of its election to exercise the Right of First Refusal within the applicable SIXTY (60) DAY period. If UPPER LANGLEY HOA either fails to give such notice within the time permitted or fails to complete the purchase within the time permitted, the Right of First Refusal Option shall expire. 4.2 IF RIGHT OF FIRST REFUSAL OPTION EXPIRES: If the Right of Refusal Option has expired, Owner may sell the Lot and assign the Deed for not more than the then applicable Purchase Option Price. Owner will ensure that the Buyer is willing, upon resale, to accept restrictions in this deed regarding the Calculation of Formula Price as stated in Article 7 of this agreement, for the purposes of the continuation of the expansion of affordable homeownership opportunities, and in the Upper Langley HOA Declarations. 6 Dec 29, 2016
3 4.3 In the case of a foreclosure sale, all restrictions set forth in the Upper Langley HOA Declarations and in this Deed Restriction on Transfer or Sale of Lot including Capital Improvements apply. UPPER LANGLEY HOA has the right to bid at any foreclosure sale of any Lot. 5 OWNER S RIGHT TO DESIGNATE A BUYER: Once Owner has identified a prospective Buyer then prospective Buyer shall, within no less than sixty (60) days prior to the anticipated closing date: a) furnish to the UPPER LANGLEY HOA Financial Review Committee (1) A Letter of Stipulation from the prospective Buyer in form and substance similar to that of Exhibit B hereto; and (2) a statement of the price and other proposed terms of sale; b) furnish to the UPPER LANGLEY HOA written verification that Owner has fully disclosed to Buyer all Covenants and Restrictions associated with membership and community life within UPPER LANGLEY HOA; c) attend an orientation, tour of the community, and an HOA meeting. No sale or other disposition shall be effective unless and until UPPER LANGLEY HOA, receives, within no less than sixty (60) days prior to the anticipated closing date, all of the documents and verifies that required meetings listed in the paragraph above have been completed. Upon which time, UPPER LANGLEY HOA confirms in writing that the prospective Buyer accepts the terms of the Deed and that the price and other terms of sale are consistent with the terms of the Deed. If UPPER LANGLEY HOA determines that the proposed Buyer or proposed sale are not permitted under the terms of the Deed, then UPPER LANGLEY HOA shall respond with written notice to Owner of this determination. If UPPER LANGLEY HOA fails to respond in writing within thirty (30) days of its receipt of the required documents, such failure shall be deemed to constitute approval of the sale. Upon receipt of UPPER LANGLEY HOA's approval as described above, Owner may proceed to sell the Lot to the prospective Buyer. 3 Dec 29, 2016
4 6 PURCHASE OPTION PRICE: The Purchase Option Price shall be the value of the Lot plus Capital Improvements in accordance with the formula described below (the Formula Price). 7 CALCULATION OF THE FORMULA PRICE: For only the first sale after initial home construction, Owner s Purchase Price shall be defined as: 1) The actual dollar amount that the owner paid for the land. 2) $15,000 Community Amenities fee. ($1000 for Water Reserve Fund is included in this fee.) 3) The appraised value of the home (excluding the land) at the time of completion. Appraisal costs to be borne by the Owner. For all future and subsequent sales, Owner s Purchase Price shall be defined as: 1) The purchase price paid by the current owner/seller. The Formula Price shall be equal to Owner s Purchase Price, as stated above, plus an escalating appreciation factor of one and a half percent (1.5 %) simple annum during each of the first ten (10) years, then two percent (2%) simple annum during each of the eleventh (11th) through twentieth (20th) years, then two and a half percent (2.5%) simple annum each year thereafter plus Eligible Capital Additions Value, as stated below (with the above-mentioned escalating appreciation factor applied upon the completion and UPPER LANGLEY HOA s final approval of the Eligible Capital Addition Construction). Owner's Purchase Price: Owner begins to earn interest beginning on the date of purchase. On intial sale, the parties agree that the actual dollar amount that the owner paid for the land plus $15,000 Community Amenities fee totals $. It is understood that the appraised value of the home (excluding the land) at the time of completion will be added to the total dollar amount listed above and filed as an exhibit as confirmation of the Owner s Purchase Price for the Lot as of the commencement of the term of this Deed. A new term will begin each time this deed is transferred. 6 Dec 29, 2016
5 [FOR SUBSEQUENT SALES, AN ADDENDUM TO THIS DEED SHALL BE ADDED AND SHALL READ: Owner's Purchase Price: The parties agree that the Owner s Purchase Price for the Lot as of the commencement of the term of this Deed is $. A new term will begin each time this deed is transferred.] Eligible Capital Additions Value: The Formula Price may be adjusted by the UPPER LANGLEY HOA at the request of the Owner to reflect the value of Eligible Capital Additions subject to the following conditions: 7.1 Eligible Capital Additions shall be limited to the addition or alteration of livable space that results in a permanent capital improvement, the construction of which requires a building permit, but not including any maintenance or routine repair of the dwelling; any painting, decorating, or similar cosmetic work on or to the dwelling; any costs which was associated with willful or negligent actions; or any costs for which reimbursement was or could have been obtained from any insurer or other persons or entity. All other construction on the Lot shall be considered maintenance or luxury additions and alterations rather than capital additions. a.) To receive consent for Eligible Capital Additions and claim the expenses, the Owner shall request a determination using the Application for Eligible Capital Additions to Premises (Exhibit C) from Upper Langley HOA regarding whether such work is an Eligible Capital Addition. Upper Langley HOA shall make such determination in writing in its reasonable discretion. The Owner must keep receipts and actual accurate time records to document the costs which the Owner wishes to claim as an eligible capital addition. For labor performed by the Owner on an allowed capital project, Upper Langley HOA shall determine the value thereof, Owner shall submit two estimates of the value of the improvement from licensed contractors who work in Island County, the Upper Langley HOA shall accept the average, of the greater and the lesser estimate. Upper Langley HOA shall also determine in writing once said Eligible Capital Addition has been completed and after presentation to Upper Langley HOA of such receipts and other documentation as Upper Langley HOA may require, the value of the allowed capital project to be 5 Dec 29, 2016
6 used herein. The value, determined by the UPPER LANGLEY HOA, will be added to the value of the Lot on the date of completion. b.) all construction shall be performed in a professional manner and shall comply with all applicable laws, ordinances and regulations, including the requirements of local and state public health authorities; c.) all construction must be consistent with the permitted uses set forth in UPPER LANGLEY HOA Bylaws and CCRs; d.) Owner shall furnish to UPPER LANGLEY HOA a copy of any plans and all building permits for such construction prior to commencing construction, and e.) any addition or alteration must not impair the UPPER LANGLEY HOA s mission to market affordable housing to the citizens of Island County, Washington. 8 DEFERRED MAINTENANCE AND EXCESSIVE DAMAGE: It is expected and understood that the Owner maintain the Lot in good, safe and habitable condition as outlined in herein throughout the term of Ownership. At the time of sale, Owner agrees to sell the Lot in good, safe and habitable condition. 9 Owner is subject to all existing Declaration of Covenants, Restrictions and Reservations and Dedication of Easements, which were recorded with this Deed in the records of Island County, and all amendments thereto, and as a result of which this PRD Community was created. 10 The covenants, agreements, and restrictions contained herein shall be binding upon and shall inure to the benefit of the respective heirs, personal representatives, successors, assigns and transferees of the parties, and the benefits and burdens thereof shall attach to and run with the land or any portion thereof. The failure of Owner to adhere to the terms and conditions of this agreement, or the waiver of or any breach of any of the terms and conditions of this agreement, 6 Dec 29, 2016
7 shall not be construed as thereafter waiving any such terms and conditions, but these shall continue and remain in full force and effect, as if no such forbearance or waiver has occurred. Signed this day of, 2016 By: STATE OF WASHINGTON ) ) ss. COUNTY OF ISLAND ) I certify that I know or have satisfactory evidence that is the person who appeared before me and said person acknowledged that s/he signed this instrument and acknowledged it to be his/her free and voluntary act for the uses and purposes mentioned in the instrument. Dated: NOTARY PUBLIC in and for the State of Washington. My Commission expires. 7 Dec 29, 2016
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