HomeMy WebLinkAboutAgenda Bill 5.D-Attch2 10/18/2004LOAN"AGREEIVILNT
This Loan Agreement (this "Agireernent") i`sl.einte red', 1 effective ras of
2004
("EffeLctive Date.") by and among I Stephen A. Lind as
Trustee of th p us i Stephen A. L'ind, "1 994 Trust U/T/D Aug ''t 29„ - and Elizabeth Dick,
an,incliVidua[ (cdllectiv'el"yL r, the "Borrower:"')'' and. th e Petaluma Community
Dev6l6i - 'rn Commission ( "A ' i,Icy��'). Agency' are hereinafter
0 en
collectively referred to aSfhe'" - Parties:''
RECITALS
A. Borrower i.s 1he owner ''of feetitle to the prbperty.l.bbated at 119 Petaluma
B:lvd. North in the City of Petaluma, County , of , Sonoma,; and . more particularly described
in "Exhibit A attached hereto (the "Property").
B. The Property- 1bcatod within the.Peta'aluma Central Business District
redevelopment project area ("Piroject Area").
C. Program (the The. Agency operates -.8 Storefront Improvement Loan'
Program") pursuahf1o, which� th'e"Agency provide ',"'loan �1' ""first-time
s s f6 he
reconstruction, rehabilitation or restoration . of buildings which are located in the Project
Area and which were constructed prior to 19,04.
D. Borrower ihas , req nested; , , and Agency has agreed t6'p provide a loan �(the
"Loan") pursuant to the terms and c6nditions h.le'reof for the,, purpose of financing the
historic restoration of the building owned by B.o.rrbwer and ',16caled on the Property in
accordance with Exhibit B attached hereto (the Project"').
E. The Agency has determined that,(i) the Property and Borrower meet the
Program eligibility' req'uiremen"t I S (ii) provision a,Jb for the Project pursuant10 the
terms t of this Agreement is co,risi-slent, With the re,d6v,e,lo,pme r nt plan ' for the Project Area
and is in the inte sts of the health,' y afety , of thereside 1 nts of the Project
Area and the City,of Petalum . p,("Cit), and ii� the Loan Js necessary to make the
Project economically feasib'Ib."
F. C * o ' wurrenfly*elrewith , "( execute a promissory note
("Note") in the-amount,of.the Loan
Agreemen anda aed'of Trust, Ament of Reht Security
DP
Which, s a 11 pro Agency With a
t and�'Fixture''Filing ("D.eed� of T'ru'st` h ssign
'
security interest in the Property, and the improvements located` thereon (the,
"Imp rovements" ). ° This,Agree'ment; the Notia,'afid the Deed of collectively
v
hereinafter referred to as the "Loan �Documents." i
-N
MITHEREFORE for good and,,valuable,considorat the receipt and
sufficiency 'o'Awhich ar hereby, acknowledged; the Parties hereby�a"'gr ee A follows.
7i 21663-5
ARTICLE I •
LOAN TERMS
1.1 LOAN AND 'NOTE Agency agrees to ,loan to Borrower, and Borrower
agrees - to borrow from and :repay to Agency:, a sum of up.to Two Hundred 'Th'ousand
Dollars ($200,0,0,0) subject to this Section 1.1..1, upon the terms and conditions and for
the purposes set forth in, this Agreement. The Loan shall :be evidenced by the Note
which shall b.e dated as of the Effective Date and executed by Borrower substantially in
the form attached hereto -as Exhibit D . Provided'thatBorrower has complied with all
conditions precedent to disbursement of the Loan =set forth in Section 2.3 the Loan
Proceed &,s hal I be.disbursed in accordance with'. S;ection 2.2 hereof.
Agency shall have the option to terminate this. Agreement, land ;shall have no
obligation to fund the 'Loan if prior to the .closing of the Loan Borrower does not
demonstrate to the satisfaction of Age t hat Bo rrower ha available for the
Project in an.amount sufficient to fully finance completion of the Project,
The Parties agree that: (i) the Loan ammountahall be limited to One Hundred
Th'ousan'd Dollars ($100 ( "Initial 'Loan Amount "),,, unless Borrowe,r demonstrates
to the satisfaction of Agency` that the cost of the: Project will exceed One .H:undred Fifty
Thousand ;Dollars (,$150,000.); (ii Agency shall disburse Loan Proceed's in, excess of
One Hundred Thousand Dollars only after Borrower °provides evidence reasonably:
satisfactory to Agency that Borrower has expended, on.the Project the Initial „Loan
Amount together with : an additional Fifty Thousand: Dollars ($50;000) from 'othe'r
sources, and (iii) Agency shall disburse Loan Proceeds only for and to, the extent
necessary for the purposes set forth in Section 2.1_. .
11 INTEREST RATE;, PAYMENT DATES.; MATURITY DATE ,Nb)hterest,
.shall be payable ion the principal balance of'the. Loan except upon the occurrence of "an
Event of Default as specified_ in Sectibn 2� of the Note. The. entire outstanding principal
balance of the, Loan togef,ber with any other sums dueAinder the Loan Documents shall
be payable in full on the twentieth (20t anniversary, of the Effective Date (the" Maturity
Date "),
1:3 SECURITY As security'for repayrnent°of the Note, B:orrower"shall
execute the Deed of Trust in'favor of:Agency as beneficiary pursuant to which Agency
shall be provided a lien against the Property and.the I;rr provernents The Deed of Trust,
shall be dated as of th'e Effective Date, shall be substantially in the form attached hereto
as Exhibit E , and shall be recorded in the official. records of Sonoma County', The,Deed =
of shall be a first lien - on the ,Property, and absent the written consent of Agency,,
may be subordinated onlyto thetitle exceptions'identif,ied in Exh'ibit:F or as Agency
shall approve in `writin : "`Permitted E-xce tions Borrower a rees that "the Deed of
PP g ( P ") g
Trust shall remain a first,lien.on the Property throughout the term of the. Loan.,,
1.4 PRE'PAYME'NT; ACCELERATION
712063-5
- on idn the outs (a) Prepaym 't" The Ndt(�,'b',r any poft ' principal balance
due_uader the Note may be prepaid at any timeyand from t to t I im'e,, without penalty or
prem ium. Any prepay ent of! - 'usf'b6. , a' by interest accrued (if
.0fincipal', rn accompanied
, any) but unpaid to the date' of prepayment Prepayments shall be applied first
to accrued but unpaid interest (if any) and then'. t`6 princi`p8I'-.`
(b) Due On Sae., U'ril'ess'Agency agro61s'.othe,fwi,se in writing, the entire
un principal bal8rite . l and all interest land other sums :accrued under the N ote shall
en consent of Agency, of all
bedue and payable upon't fhepri-T4Htt
or any part of nor interest in the Propert or th' e Improvements,, otherthan a lease of the
r
Improvements or pcirt entered into o
in the "i of business.
s5ignmnt cat'O M
"Transfer" shall include any "a -i ' e, hy'ot 1. he
. ortgagd, pledge,
encumbrance or conveyance �of this Agreement', the "Property, or the Improvements.
1.5 NONRECOUR"8E
Except as express ly'provid Od Jn'' on't5,"136 rrower shall have no
personal liability for payment of the principal ,of; , or interest (if any) on the `Note; and the
sole recourse of Agency with respect to the p ayment - . , of ,, the . principal of, and interest on
the Note shall b tthe,Propert, d ' an Y oth'r collater al""'held'by,
y aIm d Agenc as securit o y for the Note y ; provided however, cohain the fore
lim'itation of liability shall:
(A) impair the enforcement against all such security for the Loan of all the rights
and remedies of the Agency under the D eed of and an ,y financing -statements
Agency files in connection with the Loan, a's.each of thojore"go
I I " '� ' - I I ling May be amended,
modified, or restated from time to time;
(B) impair the right .of Agenqto bring a foreclosure anti " on, action for,specific
performance or other appropriate action or'proceedln'g,, enab.le,Ag,bricy to enforce and
realize upon the Deed of 'Trust, the interest in the Property and the Improvements
created thereby and any oth collateral giv66to Agency in connection with the
indebtedr),pss evidenced by the Note, and ''to.name the: Borrower as party defendant in
any such action,
(C) be dee',m any way to'impaii'r'the right of'theAgenc tbassert,fheunpaid
principal a m.,'ou'nt, of the Loan :as ,a demand for money within the meaning of Section
431.70 of tho'Cal Code of I Civil Procedure or
any-successor provision thereto;
(D) con,stiti)jea , waiver of any right, which Agency may-have under any
bankruptcy,law to file aclaim for the full amoorrlf of the indebtedness o wed tqA
gency
under the recluke that ther Property' and"' to
-, � - .1 . theImprovements ,all'conti'n
secure all of' owed to Agency in accordance with the Note and the
Deed of Trust;. or
(E) I.i,mitr or the ability of Agency to seek'or obtain` a, judg ment in st
Borrower to enforce against Borrower to:
.12663_ .3
, 4V
(a) Z recover under Section8A.!&, 4.13.2.8nd'4.15,her,*eo.f,( to �.
Borrower's indemnification obligations), or
(b), recover from Borrower compensatory da,mages, a_$ as other costs
and expenses incurred by Ag'6n_qy (including 'wit hout limitation attorney's fees
and 'expenses) arising as a result*o f the occurrence of any of1he following:
i )'any fraud or. material.ftsr6presentation on the: , p 'art of the
Borrower, any authorized reprbsentati've of the Borrower - i , n,conn.,e.ct i on
wi th the: fequest,for or creation OfAhO Loan or in any Loan Document, or
g,pp
in connection with any request for any �action or consen by A _y in
yp
-connection with the Loan.;
(ii.) any failure, to maintain insurance on the Property and
Impro as required -pursuant to the Loan Documents;
'(jJi), to pay-taxes, -assessments or other charges due on the
Property and Improvements;
(iA'the 0Tes6,nbe.o.f hazardous or toxic.material or waste ,o0the'
hereo pelfty, or other violation of,th.6 Borrower.s obligations 4, 13
or Section TA 1 of the Deed of Trust (pertaining to ,environmental
matters
(v) the occurrence, of any actor omission of Borrower that results ih_
waste to ,Orlofjhe Property or the Improvements and which has a material
ac!Verse effect on the Value 'of the Property or the Improvements'.
(vi), removal or disposal of any personal property or fixtures: I in,
Violation bf'the Deed of Trusf,
(vii) the material misapplication ofthe Loan .Proceed I s'; or
(viii) the Material mmi - `
sa Olication of:the proceeds of any insurance
..policy or award resulting from coIndern-flation. or the ex.erci's of the power
of eminent domain or by reason 'of damag&.9, loss or destruction to any
portion of I the PropOrtyortthe Improvements,
ARTICLE 11
USE' AND .DISBURSEMENT - OF PROCEEDS
.1
Z 1 USE. OF'PROC�EE Borrqwer shall. use
C the, proceeds of the Loan.
'L 6an � �r6c , sole) - rower by third,_
ee&e) so. e and exclusively to pay for costs� billed to Borrower
712663-'5 4
�' p arfie 8IM:connection wifh'the' and construction of lhe Project and such other
costs related to the Project a& Agenc y 'may approye in writing.
2.2 DISBU4SEMENTOF PROCEEDS, Upon satisfaction' the conditions
!'set forth in Section 23,::.at chose bf for"the: L'ban'p' d
rov!_ e that Borrower has
provicled'Agency with-A written requisit specifying the ' punt, and -use of `the
am
requestad Loan� Procee�d,s,padcornpahie�d by copie of bills and .'invoices from third
P and such other docuin entalion - as A cy may
p reasonably require including
gen
without limitation, eviden'do of with "ap r
"plitable 'dqbirements bf:'�the Site Plan
0 1
and Architecture Review ) th
w �Committee ("SPARC , e,initial disbursement ofLoan
: ,,Proceeds sha'll.be disbu'rsed,,ihtb escrow for w
distribution to lBbrr O "' or. Subsequent
disbursements shall be Tnad'e to Borrower no more than _b . hze per calendar month, upon
Agpnc�'8, receipt of written (equisitions`an d ocumentation, j ocumentati6n. as'descri.bed in
this Section.
2.3 CO N DIT VO NS PR E.'CE D ENT TO, D IS BUIR8 E' M t'NT OF!PROC
Agency's obligation fund the Loan a'nd disbUrse the proceeds thereof is
conditioned upont e: l - he satisfaction, of all . - Of th foi ow - ing niriclitions''
(a) Borrower's delivery to Agency of each of the following documents,
fUllY7executed'and acknowledged ;as appropriate:: (Q�' I 'the No te ; Ote,'(ii) the Deed of Trust,
and (iii) this Agreement
(b) The rec'ordatibn of the Deed Of Trust in the Official Records of Sonoma
County, subject only to Per m, itted Exceptions (ps defined' Jn Section 1.3)7'
(5) Borrower' deliveryjo Agency of evidence reasonably satisfactory to
Agency that Borrowe(',has obtained all necessary , 'p6 i 'r mit s in without limitation,
building � permits),,. licenses:, and approvals required . 10 undertake the Project, -or.that the
.,
receipt of such.peem'itg is subject only to such dond it a's-Ageh c shall reasonably
approve;
(,d) Agency and SPA shall have. approyed final plans and
specifications P'r'
,(16) Bor rowe Agency ofevildence, reasonably satisfactory Agencyth.at 8orro`.we red �pding' c�omm'itme,nts, subject only to commercially
a
reasona'b�lp 811 financing nece's'sa'ry for'the�!tbcte8sful completion of-the
'Project;
e
(f) Th�' is:50aride by an ins6r"'e''r's"8't'isf to'Agency of a leride'
r's
policy ("Title P0licy`) for `the benefit of Agency in the ,amount 'Of the Loan*, insuring that
the lien f tD 4 'b* t hl s�su Jec � o � to Per, ittbd Exceptions and such other
OefeQts;Jehs cQndJtons lu"Mbrances, restrictions,. ease�ments and I except . i I on's as
0
_g, and c6ntafining such` "b§ Agency May
oe iqwrit, , dorsemOnt&
p i rea son8 bly ,, I , he: cost 'of su ch , Title PolJqy to be,pa id by Borrower;
7,12
Borrower's deliver to the Agency of evidence of insuran.ce.co�e`r •
{g)� � Y age in
accordance with the requirements set forth in Exhibit, C attached hereto;
(h) Reserved
Borrower's delivery to Agency of ,all of the following. (a) Project
budget, (b�).construction contract; (c) performance bonds or other:assu;rance`,of
completion reasonably °acceptable to,Agency; and (d). copies of �sueh other documents
related to.the development and financing'pUthe Project as Agen.cy,mayreasonably
request; and -
(j') No material; adverse change .as: determined by Agency in its
reasonabl`'e,j'udgment.;shall have occurred in the condition of the Propertyor the
Improvements or in the financial orz other condition of Borrower since the date'of °th'is.
Agreement.
2:4 NO OBLIGATION.TO_ DISBURSE 'P'RO.C.EED:S UPQ:N D:EF
Notwithstanding .any other provision of this Agreement; the Agencyshall'have no
ob'ligatio.n to disburse or authorize the. disbursementof.any portion of the Loan'
"Proceeds following:
(i) the failure of any of Borrower's representation's iand warranties to
be true and correct in all material respects;
(ii). the termination of`this Agreement by mutual agreement Of 'the
Parties; or
(iii) the: conditions to. disbursement of the Loan set forth :i'n , Section 2.3
have not been satisfied within 180 days following the Effective
Date, , unless an extension of such date is approved b_y Agency in
writing�; , .
ARTICLE III '
REPRESENTATIONS, WARRANTIES AND COVENANTS
3.1 Borrower makes,the,following representations, warranties and covenants:
(a) LEGAL STATUS; AUTHORITY; OWNERSHIP Borrower hag all requisite
power and authority to undertake the Project and to execute, deliver and perform its ,
obligations under the Loan Documents. Borrower is the:owner in fee of the Property
and the Improv,ernents, subject only to liens, encumbrances,�easements, restrictions,
conditions, and other matters of'record or disclosed in writing to Agency.
(b)
" VIOLATION The, execution of the Loan Documents and Borrower`s
performance thereunder.do .not not result in a, breach of or constitute a default
7) 2 03 -5 6
Borra ma 'b h which. Borrower is a party or by
:under an agreement indenture or,ot er instrurnent,to .
which y e
c A O AUTHOR''. � " . The Loan Documents to which Borrower is a party
and the transactions contemplated y have each, been duly fiorized by
thereb . ul aut
Borrower, and when . executed and delivered will each constitute a valid and .binding
obligation of Borrower, enforceable in accordance,•with the respective terms thereof.
(d) LITIGATLON There; are.no pending, or to Borrower's knowledge,
threatened actions ior'procee�dings� before any ;court o.r a'd;ministrative agency which may
adversely affect the financial ,condition or operation of Borrower `or Borrower's
development of the Pro'ect and ownership of the Property and the. Improvements.
(e) Reserved.
O E WITH LAWS ' B'brrower is in in all material
respects with all local, state f COMP�LIANC
p e and federal laws ru!'es regulations, orders and decrees
which are applicable to.the Property o�`to Borrower i'n relation'theretb ( "Applicable
Law ") including without limitation, ,all environmenta health and safety and employment'
laws. Borrower has no notice from - any govern mentai'authority regarding any'
threatened or pendingl zoning, building, fire, 'or health code violation or violation of other
governmental regulations concernirig,the Property that hat not been,corrected, and no
condition on the Property violates. any'Applicable Law.
(g) ENVIRONMENTAL CONDITION'. Except as disclosed in writing to City,
as of led e of Borrower () p ert i the Pro is free and
has always been free t
eofHaza d'o ska Materials (as defined below) and �is not and has Y
s'
never been in violation of any Environmental Law (as defined below); (ii,) there are no
buried or partially buried storage tanks locatedon the Property; (iii) 'no notice, warning,
notice of violation„ administrative complaint, judicial ;complaint; or other formal or
informal notice has been issu °ed alleging that, conditions on the °Property are or have
ever been in violation of any Environmental Law.-6r-that. the Property is subject to
investigation, or inquiry regarding Hazardous Materials thereon or'the potential violation
E'nvironrnental Protection A` enc or an other governrne'ntal agencyed by. the
g Y Y .
of any Environmental Law; iv t ere is, no monitoring program required
the' .
Property„ v no toxic or, , hazardous chemicals,, waste or substances of any„kind have
ever -been spiiI' di Sr posed o'f, or stored on, under o;r at the .Property, whether by
accident, buryin,gj, drainage, or'storage in containers tanks„ holding areas or any other
means; (vi:) °the Property has never been, used.as a dump'& Landfill; ands'(,vii) Borrower
has disclosed to City all;, information, records,.andstudies�;in possession of;Borrower'or:
Borrower 'relating to ;the Property concerning 'Haza'rdous
reasonably °available to' '
Materials.
S:URE' 'No re res'entation o,
, n' Do p r warranty made by Borrower in this
(g) DISCL0
A currents contains'-- ° any,untruestatement.of�a' material fact
or omits to,state an ma;teri.al fact to make; the statements therein no t
Y . rY
712663-5 7
mis[eading."There is no fact known to l3orrowerwhich, has or migM reasph8(b[y I be
anticioated to have a material adverse effect on the business,assets, fin anci'al condition
of Borrower, or 'Borrower's ability to undertake the l'Pr Project Which has not: beery disclosed.
0 .1 -
to Agency in writing..
AIRTUCLEIV
AFFIRMATIVE COVENANTS
4.1 USE .OF FUNDS... Borrower covenants that it shall use the, Loan
Prcteeds sololyfdr purpose of financing the Pripfect . in accordance , i th,"Secti6n. 2.
4.2 PUNCTUALPAY'VENT. Borrower covenants to punctually pay the
,oTi'nc.i thereon, at the times and
,,01 bala-h of,tho Note and interest (if accrued thereo
place and I in "the:ma nner -specified . in the Note.
4 3. ...,PAYMENT OF bTHE'RINDEBTEDNESS. Borrower covenants to
punctually pay all , ar es- assessments - ta . xes and - fees related- to the Property or the
f
morov6m, entsi and.to pay the and -interest due on �any I �other
indebtedness. related ,tothe Property or the lrriptoyerhents now or hereafter at any time
owed by the Bdrrow& to the Agency brany other lender.
4.4 ACCOUNTING RECORDS; PROPERTY INSPECTION. Bo rrower
covenants to maintain accurate books rand records, in accordance with standard
accounting] prindiple5, consistently applied,and ta,permitthe Agency, during business
.hours nd upon notice b , tice to inspect, audit and examine such books and.
' records- with , rbspe,ct,to ffieLProied tho-Property the Loan. and to inspect the
Prbperty,;,during normal business hours upon reasonable, notice.
4.5 COMPLIANC LAWS. Borrower covenants W all
comply N .:,
y with
federal.,,state local layvs,, ofdinancos and rules applicable 'to, the
'Property and the, Project. Without limiting the generality of the-foregoing, Borrower'shall
comply with 811 applicable requirements of state'and Ibcal building codes and
regulations, and all aiDblicable, statutes 8rid,regGlations rialeitiriCj to accessibility for the
disal5led.
4.6., IN
Borrower shall.maiijtain and keep i.h, force at, Borrowers
expense ins.urance 'coverbge with respect to the Project 'and- the Property; in
accordance With the requirements .set forth in Exhibit attached hereto.an'd
incorporated,,herlein'.
.4.7 , FACILITIES. Borrower shall keep the Prope'rfy and the Im'provements,
and the personal' property used in Borrower'&:o in good repair and condition,
and from„ to time make nO,c e s.sa ry repairs, renewals and r'e'pl,ac.eme,nt so
thatAhe Property and' Improvements shall be preserved sand maintained'.
712663-5
4.8 I;NDEM'N'lFICATIO'N I Bor
ro'wer'shall indem`nify, defend (with counsel
reasonably accePtable°to Agency), and hold harmless the,Age "ncy, the City -, and their
respective elected and' appointed officials„ officers, agenfs., 'and employees (collectively
the Inden nitees "), from and ,again'st, and shall pay on demand, ; any and, all Fosses,
liabilities, 'damages, costs, :,,claims demands, penalfies, fines!, orders, judgments,
injunctive or other relief, expenses and charges (including attorneys' fees and expenses
of attorneys) (coll'ective'ly "Liabilities ") arising di'r'ectly or°indire'ctly in any manner in
connection with or'as a result of (a) any breach of B:orrower's covenants under the Loan
Documents (b )',a'ny failure of Bo'rrower's representations and warranties to be true and
correct in all material respects when made, (e) nlury or deatF to persons or damage to
property or other loss occurring „ porn the whether'caused' -by the negligence or
Y � J r,con truction o�mainby negligent, faulty,
na.deq ate or defecltive desig Borrower b
Id g' enance or any other
condition or otherwise or (d) any claim dernand�or cause of „action, or any action or
other proceed ing';° whe'ther,n eriforious or not, brought ' asserted. against any
, . _.
I.rndemnitee which relates to or arises out of the, Property the Project, the Loan, the
Loan Documents, or any transaction contemplated thereby, or'any °failure of Borrower to
ap p comply with all a licable state, federal and Iocal'laws and regulations; including without
P
limitation, applicable provisions of the California Building, „Standards Code, the
Prevailing Wage Laws,,;and the Americans with Disabilities Actin connection with the
indemnification under this Section for matter's,, alndemnitee'shall be ,entitled to
construction or o eration o,, the. Pro�ect,, provided that no.,.
bli ations of Borrow,ehu der,this Section negligence �or wllfu,l misconduct The o� g
on shall
survive the expiration or termination of this Agreement, th`e..making and repayment of
the Loan, any release or reconveyance'of the ,Deed'of Trust, and ,any. foreclosure
proceeding, foreclosure, sale, or delivery of a d`e'ed in lieu of foreclosure.
4.9 NOTICE TO AGENCY 1Ni thin” three busness'days after any of the
g nt of D'efault de oftwh'ichtBo;rroweof to Agency: (1 )'the
occurrence of any Ev Bo, ,
y er acquires knowledge;
change any i y, :
Bor rower; (3) -any un nsured or part all uninsue, bu ss aft”
le leg structure, iness�'loca tion, or address of
y red to ' ectin'g the Property or the
Improvernents through fire, theft, Liability; or property' dam ge ex
a in cess of.an aggregate
of Fifty Thousand Dollars ($5'0,000.), and (_4)'Borrower's receipt of a notice of default'
improvements. B� rrower " hall use I best d efforts to ensutre.that Property a the
under any mortgage or,other�financ g g
'.Agency shall' receive
y ri ght pM
timely notice of „'and shall have a ri ht to cure any Borrower default under any financing
,
such notice and j wm o e`rt ` or'tFie Im' roements and that provisions mandating
e P
P.
g h right to cure shall be included in all such documents:.
Agency shall r'eco'rd a Request for No. tice of De"fauWand Sale: Borrower shall provide to
Agency a copy of -all notiees�of default that Borrower receives from the holder of any
mortgage or otherfinancing' d'ocum " "ehtaff ecting the " or the Pr
operty.
4 fO i shall, a and discharge
TAXES AND OTHER LIABILITIE Borrower pay
d.all indebtedness obligations, ,assessments taxes includin g federal
Y ,. ,
w en due an ,an g
and state payroll and income. taxes which are the ob'ligatio'ns of Borrower in relation to
712663 -s
f ,
4.8 I;NDEM'N'lFICATIO'N I Bor
ro'wer'shall indem`nify, defend (with counsel
reasonably accePtable°to Agency), and hold harmless the,Age "ncy, the City -, and their
respective elected and' appointed officials„ officers, agenfs., 'and employees (collectively
the Inden nitees "), from and ,again'st, and shall pay on demand, ; any and, all Fosses,
liabilities, 'damages, costs, :,,claims demands, penalfies, fines!, orders, judgments,
injunctive or other relief, expenses and charges (including attorneys' fees and expenses
of attorneys) (coll'ective'ly "Liabilities ") arising di'r'ectly or°indire'ctly in any manner in
connection with or'as a result of (a) any breach of B:orrower's covenants under the Loan
Documents (b )',a'ny failure of Bo'rrower's representations and warranties to be true and
correct in all material respects when made, (e) nlury or deatF to persons or damage to
property or other loss occurring „ porn the whether'caused' -by the negligence or
Y � J r,con truction o�mainby negligent, faulty,
na.deq ate or defecltive desig Borrower b
Id g' enance or any other
condition or otherwise or (d) any claim dernand�or cause of „action, or any action or
other proceed ing';° whe'ther,n eriforious or not, brought ' asserted. against any
, . _.
I.rndemnitee which relates to or arises out of the, Property the Project, the Loan, the
Loan Documents, or any transaction contemplated thereby, or'any °failure of Borrower to
ap p comply with all a licable state, federal and Iocal'laws and regulations; including without
P
limitation, applicable provisions of the California Building, „Standards Code, the
Prevailing Wage Laws,,;and the Americans with Disabilities Actin connection with the
indemnification under this Section for matter's,, alndemnitee'shall be ,entitled to
construction or o eration o,, the. Pro�ect,, provided that no.,.
bli ations of Borrow,ehu der,this Section negligence �or wllfu,l misconduct The o� g
on shall
survive the expiration or termination of this Agreement, th`e..making and repayment of
the Loan, any release or reconveyance'of the ,Deed'of Trust, and ,any. foreclosure
proceeding, foreclosure, sale, or delivery of a d`e'ed in lieu of foreclosure.
4.9 NOTICE TO AGENCY 1Ni thin” three busness'days after any of the
g nt of D'efault de oftwh'ichtBo;rroweof to Agency: (1 )'the
occurrence of any Ev Bo, ,
y er acquires knowledge;
change any i y, :
Bor rower; (3) -any un nsured or part all uninsue, bu ss aft”
le leg structure, iness�'loca tion, or address of
y red to ' ectin'g the Property or the
Improvernents through fire, theft, Liability; or property' dam ge ex
a in cess of.an aggregate
of Fifty Thousand Dollars ($5'0,000.), and (_4)'Borrower's receipt of a notice of default'
improvements. B� rrower " hall use I best d efforts to ensutre.that Property a the
under any mortgage or,other�financ g g
'.Agency shall' receive
y ri ght pM
timely notice of „'and shall have a ri ht to cure any Borrower default under any financing
,
such notice and j wm o e`rt ` or'tFie Im' roements and that provisions mandating
e P
P.
g h right to cure shall be included in all such documents:.
Agency shall r'eco'rd a Request for No. tice of De"fauWand Sale: Borrower shall provide to
Agency a copy of -all notiees�of default that Borrower receives from the holder of any
mortgage or otherfinancing' d'ocum " "ehtaff ecting the " or the Pr
operty.
4 fO i shall, a and discharge
TAXES AND OTHER LIABILITIE Borrower pay
d.all indebtedness obligations, ,assessments taxes includin g federal
Y ,. ,
w en due an ,an g
and state payroll and income. taxes which are the ob'ligatio'ns of Borrower in relation to
712663 -s
the Project, the Property, or thejrriproverrients except those that Borrower may in good
faith contest or as to which a bona fide dispute may arise, provided Provisfon, is make to
the satisfaction - of Agency for everilu al.paymenVth;ereof in the event th6tit'is found that
the same, is an obligation of Borrower.
4.1 LITIGATION, written ef s,hall,,provi ew i _t notice to AgencylWith in three
business d 'Borrower acquires knowledge of any litigation ,penclin or
threatened against 0offower invojving a claim exceeding Fifty Thousand Dollars
($ 50 ; 00"0).
.4.12, EXPENSES OF cOLLECT10N 0R.'E_NF0RC If at anytime
Borrower defaults under-any provision -ofjhe.Loan Documents,'Borrowe'r sheill pay to
the .Agency in .a,dd'ti.,o..h any other 'sums .that May b& due AoAgency, an:1arriount
to the costs and expenses .(including without Iimitation,,attorneys' fees and expenses,)
Ageric y incurs in.c n ori ection with the cbllection, enforcement or correction of the
default, and such be a parLof the'i' d
amounts fl-.1ebteldriess secured by the Deed of
Trust.
4.13 HAZARDOUS MATERIALS.
418A Covenants. Borrower shall not :cause or permit any, Hazardous
Materi8lsfas defined below) to. be brought,upon, stored or used in, on, or
y�
the Property by , or th�e agents., contractors or invitees of Borrower
except for.materials commonly used in construction on aptiv : iti els= similar to those r related to
the Project,, or in the operation and maintericanc of the Proper ts,
ty and th'e Imp_ rovemeb
in-each case in,.compliance. with all laws,, and shall not cause any relea,se,of
Hazardous Materia'Is into, onto, under orthrough the Property. If any Hazardous.
Material is disbhar - released,, dumped, or spilled on, under, 6-r about the Property
and results in any contamination of the Property or adjacent property, or otherwise
results in the relea,se,ordisdharg'e of iHazardous Materials in., on, underorfrom', the,
Property, Borrower'shbll' promptly take all actions at Borr sold 65(petrise'. as are
nece� sar 'to e
s y domply!with all Environmental Laws (as cl below).
Hazardous Materials!' means any substance, material' or waste which is or'b6cornes
regulated by any f6dercal',, state or local govOrnmentall authority, ,and includes without
limitation. (i) petroleum or oil or gas or any direct or indirect product or, by-product
thereof; (ii),asbestos'and; Y a'ny'mat6ri'al.:containing (iii) any substa nc6. mate�rial
ri
or Waste �eulated b or listed (directly or by reference),as a "hazarclous*: substance'
'
"hazardous: material ", rial", hazardous, waste", "toxic waste'', "toxic pollutant", "toxic
substance ... . .. solid waste" 'or "Pollutant or contaminant" in or pursu" ant-la, or similarly
identified as hazardous to human health orthe environment in or pursuant to, the Toxic
Substances Control ActJ15 U.S:C. 2601., et seqj!,''the Gomprehensive� Environmental Response, - Compensation and Liability lity Adt. [42 U, S,.G. Section 9601,, et se.q.],. the
Hazardous Materials Trans
portation Act [4 Section.5101, ei seqj,
the Resource Conservation and Recovery Act [42'U., , &C. 6901, et �seq;],t . Federal
Water Pollution Control Act, [33 U.S.C. Settibn' 1251], the Clean Air Act [42 U.,S.rC
7 12663-5 10
Se.ction 7401, et.�seq.]` the e CalifOrnia Underground Storage'df Hazardous 'Substances
Act [California Health and Safety Code Section 252,8p, et seq], the California
H'azard'ous Sub,steinc Act [California Health ',and "" Code Section 25300,
et seq.], the California'Hazard6us Waste, Act [California. Health and- Safety Code,.Section
25100_ et seq.], the, California 'Safe Drinking ;'Water and'' Toxic Enforcement Act
[California 'Health and Safety Code Section , 2 , 5249,,�15 1 et seq], and the., Porter-Cologne
Mater Quality Control A ;[C alifornia Water
q a.. i Code Section 1 et " as they now
Pxlst,or�are h ereafter mended, 'togeth er with any promulgated thereunder;
fT
(iv) any substance,', material or waste Which. is', �'e` ine'd as' such or regulated by any
S,Pperfund" or "Superlien" 1, orapy Environmental Law;,Iqr''(�) an other- subst ance,
material, chemical, waste' or pollrUlant identified as hazardous �� tox ' an d regulated'
s�,or - oxic
Lin_d any other, federal- state or:loc-a[ environmental law,,includingi without limitation,
asbestos, polychlorinat6d,"biphe"n' n'atU,tai[�a d synthetic fuel products
gas,an
and by-products..
"!Environmental Law" means -all federal, state or local statutes rules.,
regUlatiQns, ordee, decrees; I' or common law doctrines, and pro s
Vi 'iOns and
conditions of permits, licenses and other opera,tihg,qu horization , regulating, or relating
to, or impo-sing liability or-standatdsilof conduct coni''cerning pollution or of
f
_
the environment, including natural resources; .(ii) exposure; o, persons, including
employees and agents; ',to ' Hazardous _ ,a erials (as; defined, abov"e) or other products,
raw materials, chemicals or other substances; (iii) protection ,, Q o the health or
p
w e 'Ifare from the effects of by- e emissions,
s,'.!..id'i,sch8 or releases of
chemical substances from 'industria , or commercial activities I - *(iv) the manufacture, use
or introduction into commerce of chemical substances, ihcVdJ limitation, their
manufacture,, formulation, labeling, di8lribUti
pq, transportation, handling, storage and
disposal; or (iv) the use, rel6aseb'r disposal 6ftoxi or ] �c , substances or
Hazardous Materials or the re mediation of air, surface waters., gro.undwaters or *soil, as
now or may at any jatec time bo,Jh,effect; including but not limited to the Toxic
Substances Control Act [15U.S..C. 2601, et seq.] the Comore hen 8 iv6 Environmental
U n'01'' seq],the Rbilct Hazardous Materials TrqnsportatI on Authorization Act [49'&C. Section 5101, ot >seqj,
the. Resource Conservation an ry
ecove�Act [42 U &
C... °6901, et seq ]'the Federal'
al'
Water 06flutioh" Control Act ,,33 U.S.C. Section 1.251]�,Ihe'C'lean Air Act [42 U.S.c",
Section 7401, et seq], the Un,dorprbu.nd of H,`azardoi_iSrS
Act [Califcirnia" Safety Code. Section. 25280- et'seq],'the California
Ha2atdous Substances, Account Act [California Health and Safety Code Section 2.5,300,
et seq.], th6-Califo`rnia Hbiardbus Waste , ActjCalifb,�,nia He,�Ifh� and Safety Code.S"ectibn
25100, et seq.], the C alifornia Safe Drinking I Water'ran,d Toxic,Enforcemen't. Act
[California Health! and Safoty Code Section 25249.5,'et seq. and Romer- Cologne` Water Obality-Control Acct [,Calif ,; - orniO Water Cod ,SOction 1300G, et s,eq.], as they now
exist oriare,hereafterami'prid'ed together with any iregu I lbtiohs promulgated thereunder.
4.13.2 INOUMNIF i CAT 1,0 N., B.Oupwer,shall indemnify, defend' (with
counsel reasonably acceptable to Agency), and hold Jh harmless from
d i 1 4
1 71266' , -5
and avid'st Liabilities arising directly or "indirectly in any m anner with or as a
result Qf the ,breach of Rwrow&.s covenants set forth in Section 4.. 1 3.1 or fto actual, or
alleged release or presence any Hazardous Mate'rizils'on, under,"in'or abdutthe
P(ope ff?,, - ethei ,a"(0 I less. �of the
w.h r known or:uh,knbwh,, foreseeable orb reg,
source of such release or when such release occurred or such presence, is discovered.
The fofQgOing ihdeffi n y i ncludes, Without lirpitation, all costs ofi investigation
_ i ".
assessment, containment, removal,, remediation of I kind, and cl,isposal , qof such
Haz_ardOu.8 :Mateti8Is,, . all cost$ of determining Whether Ahe Ptopbrty is' in com with
Environmental Laws, all costs associated with b in gin'gjh e d
Property ihto
with,'all �app'licable. Environmental "Laws,, and all"costs lassociated with clairns for
damag Or injury t0per5b"ns, proporty; or natural resources. The iridOrn
n.ityclescribed
in this SeGtibn shall survive the expiration or termination of this Ag reement, redment the making
and, repd me6t of the the,rel'6a86, or reconvoyance of ;the, Deed of; Trust, 8hdahy
,foreclosure proceeding, foreclosure : sale ord I e . I ivery of deed in lieu of foreclosure,,
4.14 NON-DtStRIMINATIM. Borrower r ..by and 'for it8e!f,'and for i�ts-
successors and,'asgigns that there shall be no discrim'ination against or segregation of a
person or;,bf 8 - group of persons on ac coui! Ofrc)ce. color, religion, cteed,,,aex, sex. ual
orientation,. -marital: status, familial status, ancestry dr national. origin in the sale lease,
sublease, `transfer, use,, occupancy, tenure Or enjoyment of the ;nqr. shall
Borrower o,r a n y persona cla 'ru i ng under o r through Borrower establish or pe rmit any
such practice or practices,of discrimin*ation or,s'egre,gatibn, with reference to the,
selection, .Ioc'a'fi'cin use or occupancy oftb nants,Iessees, subtenants,,
sublessee.s�`or vendees in the Property.
4,14.1 MANDATORY INALLISUBS DEEDS; LEASES
AND CONTRAC Al d eed s�,- lea'ses �,or -contracts, made or entered ; into by Borrower,
its successomorassigns, as to any portibn of the Property, the -Improvements, or the:
Profect, shall'Contefin'thereiri the following language:
(a) In Deeds�:
"Gr'antee herein covenants b.y . and for itself, its successors and assigns that there
9
shalt beno discrimination against or segregation :of'. a, person. or group,of
persons on account 'race, color,.creed,, religion,,.,sex, marital status, national
origin or ancestry - in, the sale, lease; sublease, transfet-,.�Ose, occupancy,,
or-enjoyment of ,the property herein conveyed nor shall the grantee or any'person
claimj" ng u - d - - r through the ,gran'tee or permit any'such or
un der 0
pra,ctices of 'discri'mination or segregation with reference to the selection,
location, number, use or occupancy of tenant&, lessees, subteriants, su.blessees
or vendees in the property herein conveyed. The foregoing covenant shall run
with the land."
(b) In Leases:,
L]
71 2_663-5 I -)
a 'a n
"The lessee herein �.covenants .by and for the lessee o personal
e: resentatives and assi ns and all ersons cea min a'der the l he
r irs, p
P - � 9 P � g � � r,thro'ugh
the lessee that this. ea se. is made subject 1o.`th6 .condition that there shall' be no
discirimin ` id' a ainst or'se re ation o ,
g g g f any person or' of a group of persons on
account of ra "ce, color, creed, religion, sex; rnarita .status; national origin or
ancestry i "n'the leasing,. subleasing;'transfe'rring", :use,.;occupa
j 'cy; 'tenure or
enjoyment. herein leased nor shall the lessee or any person claiming
under or th the lo
rough thessee establish "or ermit an such ractic& ractices of
p Y P P
discrimination or segregation with reference to the selection, Location„ number,
use occupancy of' ;tenants lessees, subl'essees or vendees in the
land herein leased."
(c) In Contracts;
u
There shall be no discrimination against or segregation �ation of an. person or
g 9 Y P group
of persons .on account of race, ,color:. creed,, religion, sex, marital status, national
origin or ancestry, ill sale, lease, sublease, transfer, use, occupancy, tenure
or uunder�or through h the t a es abltsh or ermit'a r such practice or prg actices
p y p e or practices
of discrimination or segregation with reference to the selection, location, number,
use or occupancy of tenants, lessees, subtenants; 'sub'lessees or vendees of the
land."
4.15 PREVAILING'1NAGES Borrower�shall pay or shall cause Borrower's
contractor and subcontractors to, prevailing wages in the,,constru of the Project
as those wages are determir ed pursuant to Labor Code Section 1720 et seq. and the
regulations adopted pursuant thereto ("Prevailing Wage taws ") and shall comply or
shall cause the contractor and.,sub,contractors to comply:with the all other applicable
provisions of the Prevailing Wage Laws. Borrower shall maintain or shall cause the
contractor and subcontractors to maintain such records as are necessary to determine if
prevailing wages, have been paid as required pursuantto'the Prevailing Wage Laws:
During th nstruction of the Project Borrower shall
p at the
appiicable
'p e,' ates of er diem .'
: Pro ert ' � r vailin r p Borrower shall, a d
wages contractor � hei -eby
p Y a'll Indemni
9
agrees to u,ncon` itio emnifees from.�and again any a s acceptable to Agency); and
f
hold harmless the' Ind all Liabilities, which directly or
indirectly,, in whole or'in part, are; caused by, arise from, or relate to, or are alleged to be
caused by, -`ar 9&from`,,or�re'I'atd to the:p or requirement of payment of prevailing
wages or the requirement.of competitive .bidding in the cornstruction of the Project, the
failure to comply with any state or fed"eral labor laws,, .or standards iih
connection with this Agreell including but not limited to the Prevailing, Wage Laws,
or any act or omission of Agency or Borrower related f this Agreement with respect to
e ay ethe Y suuranailing wages or the requirement of
co pe i ive prrienb o reg; ire dy din whtithe r o or payment o ce policies „shall hav been determined
to be applicable, pp ble to an y such claims, demand's,,.suits, actions, losses, liabilities,
expenses, . penalties fin„ es ltorders, judgments, inlun`ctM4,or other relief, costs, damages,
71112663 -5 �� �. 13
or administrative, enforcement orlud •
icial proceedings.. f `is further agreed, thatAgency
does not and shall not waive any rights against :Borrower which it may,have by reason
of this indemnity and hold harmless agreement because tof the acceptance by'Agency,
or the A eposit ,with Agency„ of any of the insurance policies described in this Agreement.
The; representations, warranties and covenants contained in this Section shall survive
th;e.expiration, ortermnation of this Agreement, the making and ,repayment of the Loan,
any release or reconveyance of th -;Deed of Trust, and any foreclosure proceeding
foreclosure .sale, or delivery of a deed in lieu offoreclosurec.
ARTICLE V
EVENTS OF DEFAULT
'The occurrence of'any o'ne or more of the following events shall constitute an
event of'default hereunder ( "Event of .Default "):
( . If Borrower fails to pay when due th principal, and interest {if an
payable under the Note and such failure continues for tem(10) days after`Ageney
notifies Borrower'thereof in writing.
(b) If, pursuant to or within the meaning of the United States
Bankruptcy Code. any other federal or state law relating to insolvency or relief of
debtors (''Bankruptcy Law "), Borrower (i) commences a, voluntary case or proceeding;
n, consents, to the entry '
(ii) consents to the a " of t'me t of o trustee, receiver, assignee
liquidator I
n la r o as ry m. re�
(iii) PP g q
official ;for Borrower; (iv)' makes an assignment for the benefit of its creditors; or, (v)
admifs in writing its inability to pay its debts as they become'due..
,(c) If a court of competent jurisdiction enters an..orderor decree_ under
;any Bankruptcy. Law that (i) i's' for relief against Borrower in a_n involuntary case,, (ii)..
appoints a trustee,, receiver, assignee, liquidator.orsimilar official for Borrower or
substantially all of Borrower's assets, (iii) orders th:e liquidation of Borrower, or (iv)
issues levies a judgment, writ, warrant of attachment or similar;process against,the
Property or the Project,, and in each case'the order or .decree is not released, vacated,
dismissed,or fully bonded within 60 days after its issuance.
(d) If an event. of.default has been declared by the;,holder.of any debt
instrument secured by a mortgage or deed of trust on the Project or Borrower's interest-
in the Property.and'such holder exercises a right #o declare gall amounts due'und:er that
debt instrument immediately due and payable, subject: to the expiration of any
applicable, cure period -set forth in such holder's docunerits.
(e), If the Borrower fails to maintain insurance on the Property.and the
.Project as required pursuant to the :Documents, and" Borrowerfails to cure such
default within 15 days.
7r12(i3 -�
14
® f Sub•ect to Borrower's right, to c ntest the following charges
O _) . g„
o
pursuant ",to the Loan Documents, ifithe Borrower fails to .pay taxes or assessments due
on th'e Property or the P c
roje k t or fails to pay any other e,harge that l may result in a lien
on the Property or the Project, and Borrower fa'ils to cure such, default within 15-days.
(g) If any representation or warranty contained in the Loan. Documents
Y with
p regoing or with any
request for sbursem'ent of Loan Proceeds roves�to have been false or misleading in
;any material adverse respect when made.
(h) If the: , Borrower defaults in the performance of any term, provision,
covenant or agreement (other than an obligation enumerated in this Article V ) contained
in this Agreement or in any other Loan Document, and unless such document specifies
a shorter cure event of a moneta period default orah rt days in thee o "foa ten (10) d'ays,,in ahe
ry y ( ) y nonmoneta y default
( g he ,default to
after 9 Y Y even � n rn .' a of t
agrewnttpen notic
B we d or e such lon me as A e u. o'
P 9 Y p, ,
writing)`; provided that in
each, case Borrower c the cur n dult efault withi;n' thirty (30) days and
there p
after rosecutes ° g f such defa with due,:dili'gence and in good faith.
(i) If an Event of Default.sha have been declared under'anyother
Loan Document, subject to the expiration of any applicable cure period set forth in such
documents.
ARTICLE VI
REMEDIES
6.1 REMEDIES. AND Rf,GHTS , UPON DEFAULT Upon the occurrence of an
Event of Default and the expiration: of a_ny applicable cure period, Agency shall have all
remedies availabl "e to it' under ;law o.r equity, 'including, but not limited to the following,
and Agency ma at- its.electi b , lawh notice o OrAe �:nd u Borrower, except for
notices: or demands: re.gwred:
y or expressly y q pursuant fo the" ""Loan
Documents, exercise one, or more of the following remedies;:
a) Accelerate and declare th'e balance of the Note and interest accr
ued
thereon i`rinrnedliately due and payable; '
'p , pe
b Seeks ecific p rforma'nce to enforce terms ofthe Loan Documents;
c) Foreclose on the Property pursuant to the Deed of Trust;
Pursue any and all other remedies available under law to enforce the
term's of the Loan Documents and A °ge'ncy's rights thereunder:
71?663-5 15, ��
6.2 REMEDIES'CU.M'.ULATIVE ;Each ofthe remedies provided herein:is
cumulative and not exclusive of and shall not prejudice any other remedy provided in
an y .OtherLoan Document. The Agency may exercise from time to time any rights and
remedies available to, it unde,r:applicable la,w, in addition - to,'and not.in lied of, any rights
and remedies expressly granted_ in this; Agreement or in any other 'iristrumenf or notice
demand or legal process of any kind
ARTICLE VII
MISCELLANEOUS
7.1 NOTICSS Except as otherwise specified in this Agreement', all notices to
be-sent pursuan t to this_Agreemenfishall be made'in writing,. and sent'to the-'Parties at
their respective addresses specified below.& to such other address. as a ;Party may
designate by written notice delivered to tho� other,Party' in' accordan_'ce with this Section.
All such notices shall be, sent by`
(a)' personal delivery, In which case notice shall be deemed delivered'
u_ pon receipt;
(b) certified or;registered marl, return receipt requested, in which; case
notice' shall be deemed delivered two (2) business days after deposit, postage prepaid
in the United States niail
(c) nationally.recognized over..night in which case notice shall' be.
deemed :delivered one (1) day after deposit with such courier-; or
(d) #acSimile transmission in which case notice shall be deemed delivered
on transmittal, provided that a transmission report is generated reflecting the- accurate
transmission thereof.
Agency: Petaluma Community Development Commission
11 English. Street
Petaluma, CA 94952
Attn:
Borrower:
•
7 12 663 -.5
7.2, COUNTERPARTS. This Agreementmay; be executed'in multiple
counterparts each of which ich shall, be an original and all of."whic h taken together shall
constitute one and the same instrument.
_,73 1 SEVERABILITY.' any term,, provision, coven . a .. nt or condition of this
.Agreement is held by ?. court of competent juri to be invalid,; void or
:unenforceable, the re m'a'ind e'r: bfthe provision , shall continue in full force and effect
briless the rights and obligatio of Parties are materially,,altered,or abridged by
such, invalidation, voidin'.g or un
7-4 LEGAL ACT A TTORNEYS' FEES; , In , . the, legal action is
commenced to interpret or to enforce the terms of thi'8 to collect .damages
as a result of an y brea 'h the rei 0 c , f the. P8ftv pnbvailing� i " 'sluch"action shall be entitled
' n a ny
to recover against the other Party all d 1
: reasonable attorneys' fees and costs incurred in
such action.
7.5 CAPTIONS, ]WERPRETATION. The of the LSections and
Articles of, this Agreement are fo r ,convenience I 'only and t are _n.ot•ihtended to affect the
interp'retat'ion or construction ,of ' i:the provisions herein contained. The language of his
Agreement shall.be, construed as, la Who! e accordin g tojt' ir meaning and not strictly
for or against any Party. Time is of the. essence in they perform ance of this Agreement,
• 7.6 FURTHER ASSURANCES. The Parties ies agree -to execute, ack.nowledge
and deliver to the.other s.uch and instruments., and take'such other
actions, as either shall reasonably request as may be necessary 'to carryout the intent
of this Agreement.
7.7 PARTIES NOT TCO- VENTU RERS. 'Nothing in'this Agreement is intended
to or shall establish the Parti3Os as co-venturers,'orprincipal and agent with
one another.
7.8 GOVERMNG! LAW, VENUE. This Agredni, e""nt shall in all respects.be
construed and enforced in,accordance 'with laws of the State of California without. regard
to principles of conflicts of IaWs. 'The consent. tQ�'tli ejurisdictioh of anyfederal or
e
statcourt in the jurisdiction , on in which the Property is located ed (the "Property
Jurisdiction'"),., Borrower'!agrees: that -any , controVersy, arising under or. in,,relati.on,to, this
Agreement or an I y other Loan Document shall be Ii.tigated exclusively in courts having
jurisdiction. nJt&,
D I b Property Jurisdiction. Borrower irrevoca bly consents to se i
jurisdiction,, and venue "of such courts for any such lit(gation a`ncl waives any other venue
to which A might be entitlqd .by virtue of domicile,, habitual residence or otherwise
7. ' . 9 ' , . WAIVER; - M . OR , IFICATION AND o failure or delay on the
part, ofjhO.Agenoy in exercising any right, �erni power, or 64 he power, shall operate as
- any,su,qh right, power, or
a, waiver thereof nor single or partial, exercise of
, 1. 11, y . I i
rem_edVprb61ude,any otheaor further exercise thereofor the exercise of any other right,
powerl,•,ol remedy' hereunder. No modification, OT wdi,'�pr. of any provision of his
712663-.5 17
Agreement nor any consent to any departure by Borrower therefrom, 'shall in any event
be:effecti.ve unless th&sa'meshall.be in writing and then such Waiver or�consvent shall
be only in tte specific instance and for the specific purpose for which given.
No notice to or demand on °the Borrower in any case shall entitle the'Borrower to any
other or f. u_rther notice ordemand in-similaror other, circumstances. No amendment to
or modification oft Hs -Agreement shall be 'effecti`ve unless and until �8uch, amendment or
modification is' in writing, properly approved in accordance with applicable procedures :,
and executed by the IRarties.
7.10 ASSIGNMENT This Agreement shall be binding upon and inure 'to the
benefit of the Parties and their respective successors and :assigns. Notwithstanding, the
foregoing, Agency's, obligation to Inake the Loan is, personal to Bor-rower, and shall not
be assignable;_by Borrower by operation of law or othe.rwise:'absent express written
consent of Agency,- any assignment by operation of law or otherwise shall,be
void.
7.1:1 - NO'THIRD_PARTY RENEFIGIARIES There shall be; no third party'
beneficiaries to, this Agreement
7.12 ' ENTiRE.AGREEMENT; EXHIBITS This. Agreement; °togetherwithjtf e
other Loan Documents, constitutesthe, ent'ire'agreement between the Parties with
respt
contemporaneous matter hereof and supersedes any and all prior or
l? m J
ora I. or agreements and negotiations between the .Parties with
respect thereto... Exhibits A.through F .attached hereto are incorporated here.inby
reference as though fullyset forth herein.
7..1.3_ SURVIVAL All representations made by Borrower herein and the
provisions of Sections 4.8, 4.13.2, 4.14 41 and-4.1 5 hereof shall survive the
expiration or termination of this Agreement; the making and repayment of the Loan any
release or re con; veyance of.th'e Dee.d and an :yforecIosure proceeding,
foreclosure sale, or delivery of .a d eed In lieu_ of`foreclo'sure. The representations of
;Borrower made herein have been or will be relied upon-by the Agency, notwithstanding
any =investigation made by the Agency or do its behalf'.
7.14 AGENCY STATUS Borrower;recogni2es and agrees :that Agency is not a.
commercial lending 'institution; but a public agency exer:.cisingjts authority to protectthe°
public health, safety and welfare. Any duties or obligations which a commercial lending
institution may have to Borrower shall not apply to this transaction except>as :s..et forth
herein and in the Loan' Documents.
7.15 ACTION BY 'THE AGENCY Except as may be , otherwise specifically
provided, whenever any approval, notice,, direction, or consent by the Agen,c.y is
required or permitted under this Agreement such action sh:ali be in writing, and such
action may be �gi,Ven, made or taken by the Agency Executwe Director or'by any person
who shall have been designated by the Agency Executive Director..-,-"- ithout urther -
approval by the Agency go,Vern'ing board. Agency'sh'all use. reasonable :best efforts: fo
7 12663-5 is
respond to requests for any such. approval, notice, or consent in a timely
manner.
7.16 ICON-LIAB"l�LITYOFAGENCY.,ANDAGENCY-'OFFICIALS.EMPLOYEE'.
AND AGE No member,, official, employee or age n't'bf the Agency . s'ha I I - I " be
personally liable to Borrower or bny successor in' interest toy ahyI of the foregoing in the
event of any default,or breach by-theiAgen Cy
or f6r any -aMoun of money which may
become due to BorroWer,_br BorrOwer's successor in interest or for obligation of
Agency under thisAgreement.
7.17 RIGHT OEACCES& Borrower horeby,graints"to Agency a,nd Agency's
agents and employees the rjg_h,t, upon reasonable notice to. Borrower of not less than
two business days, to 6ent'er,u" 6n?'thI6 Property and. the lmp�oveirnents for" the se of
p 0purpo
inspecting, examining, surveying and reviewing the 'same forthe purpose of ensuring
compliance with the Loan Documents.
7.18 PRORATION'OF.CLOSINIG COSTS., Age"h'c'y.and Borrower shall each
pay one -half of the costs of escrow and any.recording fees applicable to the Loan
Documents.
7.19 WAIVER OF TRIAL BY JURY: BORROWER AND AGENCY EAGH (A)
AGREE NOT TO ELECT ATRIALBY RESPECT TO ANY ISSUE
ARISING OUT OF I TH IS NOTE OR THE'RELATIONSH I IP BETW .1 THE PARTIES
AS LENDER AND BORROWER THAT IS TRIABLE OF RIGHT BY JURY, AND (B)
WAIVE ANY RIGHTTO"TRAIAL BY JURY*WITH:RESPECT TO SUCH ISSUE TO THE
EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE. THIS
WAIVER OF RIGHT TO TRIAL, BY JURY LS: SEPARATELY GIVE BY EACH PARTY,
KNOWINGLY AND VOLUNTARILY WITH'THE. BENEFIT OF COMPETENT LEGAL
COUNSEL.
IN WITNESS WHEREOF,., the Parties ' have each caused this Agreement to be
duly executed as of the date first written above.
BORROWER
STEPHERA. LIND 1994 TRUST
UMD Au'g'ust 2 , 9, 199 4
By:
St6pheh A. Lin Trus,fee
E'lizabeffi' Dibk'
712063-,5,
AGENCY:
PETALUMA.COMMU'NIT.Y OEVELOPMENT
By
Its: Executive-Director,
II. .
•
•
Exhibit A
PROPERTY
(Attach'legal description.)
III
i
Exhibit: B
PROJECT
(Attach description of rehabilitation /restoration work to be undertaken.)
Exhibit G
INS.URAMCE REQUIREMENTS
'Unless Agency agrees othierwise'in writing, Borrower shall, at Borrower's sole cost and
expense during, the,term of,;the Note dated' as of`t'he date hereof,and executed by
Borrower for.th'e benefit of Agency (the "Note ") shall keep and. maintain the following
policies of insurance. 'Capitalized terms: used without definition in this Exhibit C shall
have' the meaning ascribed to such terms in the Loan Agreement of which this Exhibit is
a part.
A..,, Property Insurance Insurance for the ; risks of direct physical loss, naming
Agency as loss payee wifh minimum: coverage being the peril insured under the
standard Causes of Loss - Special form (ISO Form CP 1030) its equivalent, covering
all Irnprovements; all fixtures and equiPment locat on or in, or constituting a part-of,
the'Property, in an amount equal to one hundred percent (100 %,) of full replacement
cost of all such property. The insurance shall (a.) cover explosion of steam. and
pressure boilers `and similar apparatus,, if any, located, 'on;, the Property, and (b) ,cover
floods if the Property is in a Special Hazard Area,' ,as determined by the rederal'
Emergency Management Agency or as shown on a NationeiV'Flood I'nsuran. ce Program
flood map. The insurance required hereunder shall be in amounts sufficient to "prevent
a co= insurer under the terms of the applicable policies with not
Borrower becoming
ore than a TenThousand Dollars'($10,000') ded'u l (o,r such higher deductible
approved by the Agency) „ifrorn the loss payable for any casualty: The policies of
insurance carried in accordance with this . Para'grd h A , shall' contain a "replacement cost
endorsement,” an. "i,ncreased cost of construction endorsement ".and an endorsement
covering unde'rground.work, if applica'b'le to the Project:
B:. Liability Insurance .Cbmmercia
1 general liability insurance on an "occurrence
basis" covering all claims with respect to injuy or damage' to person's or property,
occurring on in or, about th
g e Property or °'the Improvernen'ts: Commencing upon the `
date of initial disbursement of Loan Proceeds and:,at all times,.prior -to repayment of all
sums a ab'le;u'nder the - ' , N" ote,'the.: in its of liability' p y 1`his. Paragraph B_ ° shall he not
less than Million Dollars ($2,0'00,000) combined , smg;l:e limit per:occurrence, with a
deductible no gfeater than Ten Thousand Dollars ($10,000) or'auch, higherl deductible
as, may be approved by Agency.. Upon receipt of written demand from Agency,
Borrower s'ha,111 increase the limits of Liability insurance required hereunder to the`amount
commensurate with, that generally carried by a majprity of owners of other comparable
projects in'Sonoma County.;. The 'insurance shall also include:
O coverage° against liability for bodily, injury or property .damage arising. -out of
the use, by or onibehalf of Borrower, of any owned, non- owned leased or hired
-autornofive, equipment in the conduct of any and all' operations conducted. in
connection wiih Project or the Property;, .
-712663-5 7
if) premises and operations includin
without, lirftita(fi,on, bodily inJUTy,
personal injury,. death or property damage occurring upon, in or ab.o.uIt the
Property or the IMprovement's on any elevators. or any escalators ':therein and on,
'in or about ,the adjoining sidewalks, streets ,and passageways;
(iii) broad form property damage, liability,,.
(iv), 'additional insured and primary insured.endorsements, protecting Agency.
and' City and.1thoir respective.elected and appointed officials, officers, employees
and 8ge.nis, and
(v) - personal injury endors6ment.
C. 'Worker's Compensation Insurance. Worker's 'compensation insurance, in the
OmQunfre.q under then 6,pplica!510,atate law, covering Borrower's l employees, if
.any., at.wo,rk in or upon the Prroperty in services -or opera tien I s in co
frinection,
with the Proj0'qt,,:tho,]mprovements or - the'P rope rty. Borrower shall require 1hat any
general construction contract entered into by,Borrowgr with regard to they Project include
a contractual Ondertaking -bythegenaral.c on tracforto,provid'ew.orker's,comi)enseition
insurance for its employees engaged in construction of the Project in an amount in
compliance with ,6pplicablb: state law.
D. Cou rse of Construction Insurance. Course Of construction i'nsukance', namin
Agency a§']oss payee in the same amount as required 'in Paragraph A'aboveJbir
property insurance, covering all construction 'activitie's on the Property.
E. General Insurance Provisions. All ,policieaof insurance' provide.dl.for-,'in'this
Exhibit shall be proVidibd updorvalid'and enforceable, policies, in,$,udh forms, and
m
amounts a-s.h'.ereinbefore specified, issued by insurers, licensed to do business in the
State of California "(or a,pp roved to do ' in California and listed, din.the'C'eflifornia
Department of Insurance, list of Eligible Surplus Lines, Insurers or successor 'listing)
having a rating of,ANII, or better' n Best Ihsu'rahce GUide or, if Best Insu'rance,Guide is
no longer in existence, :a.comparable rating from a'cbmparablemfing service. Prior to
the closing of the Loan, and thereafter, not" less 4than thirty (30 days prior to the.
expiration date of each policy furffished this' . Exhibit ,6 . Borrower-shall deliver
to Agency Certificates evidencing the insurance -re.qu , i r ad to be tarried by Borrower
,under this Exhibit C. * If requested by Age dreliver wit fifteen., (15)
days*follbwing such request, certified, es
ed, com'olet,e cop�i.e,s.of the,insuran e poli Ci
required hereunder. Insurance policies to be provided herein shall meet the follow
(a) Each policy of insurance obtained pursuant to this Agreement*, other�
than,workef's compensation insurance, shall contain endorsements Wh-ichprovide (i) a'
waiver by the`lnsurer of the Agency, Borrower or any
subtenant for negligence of,any such person, (ii) a-statemen tfhat the in'surairicb shall
not be invalidal6d should, any insured waive in Writing prior to the loss anybr all right of
recovery against any party for l oss accru'in 9 'to the property described in the insurance
712663 5 24
•
policy, and (i_ii) a provision that no a:ct, omission „of Borrower which would, otherwise result in forfeiture or reduction.�of the in5uran "ce th`erein:!p:rovid'ed shall affect or lirnit.the
obligation of the insurance company to pay'the amount of any loss sustained.
(b) By.endorsements,. Agency and Its elected and appointed officials,
Officer, employees and agents'shall be';named'as additional" insured under the policies
of liability insurance and as loss payee -underthe property damage and course of
'construction insurance required to b 6 maintained by Borrower hereunder.
f
(c) Each policy required hereunder shall in,06 del a Notice of Cancellation
'or Change in Coverage Endorsernent.which shall” provide that such policy shall not be
caocelleftr materiallychan'ged_ without at.least thirty (30:) days' prior written notice by
registered or certified mail to Agency.
(d) All insurance policies. shall provide that there shall be no exclusion
from coverage for cross liability among the listed'Jnsureds
(e) Any certificate of insurance applicable to co.urse'of .construction
insurance to be maintained shall be deposited with Agency prior to commencement of
construction.
insurance applies separately to each insured ��hat is seek i that proves that the
(f) Each policysh`all contain an endorsenie
' t ing coverage or against whom
a claim is made, "except w ith respect to the ,limits of liability.
(g) -Each policyshaR b& written. a primary policy not contributing with
and not in excess of coverage that Agency or City'may carry.
(h) Each policy shall expressly provide that neither Agency nor City shall'
not be required to give notice of :acc'idents or claims and that neither Agency nor City
shall have liability for prerni;ums.
F. Blanket Policies Any insurance provided fo,' - lin this Exhibit C may be placed by
a policy.or - policies of blanket insurance; provided, however, that such policy or policies
provide that.the, amount of the total insurance al'located,to the Property and ,the
Improvements shall b:e'such as to furnish protection the equivalent of separate policies
in the amounts herein required, and provided further that in all other respects any such
policy or poaicies shall comply with the. other provisions of Exhibit.
G. Weiver�of 'Subro aq tion To the extent,permitted by law and the policies J ies of
insurance required to be.,maintained hereunder, and without affecting such insurance
covera "9 e, Agency and Borrower each waive any right to recover against the other (a)
damages for injury or death. of persons, (b) damage; to property, '(c) damage to the
ents or an art thereof,, or �d claims by reason of any
the h he Improvem y p . ( ) arising
roe foregoing, `to the extent that.such damages and %or.claims are covered (and only
to the extent of such" coverage) by insurance ,actually carried by either Agency ,or
Borrower. This provision is intended to restrict each ,party (as permitted by law) to
,recover a 9 ainst insurance - carriers to the extent of such 'couerage and.waive„fully, and •
for the benefit of each any ri,ghts.,and %or claims night give rise to,.a right of
subrogation in. any insurance carrier.
H. Compliance- with Po'Iicy Requirements Borrower shall observe and comply
the'requ rement&of;all.poli'cies of public liability, -fire and _other policies of,insurance at
any time in .force with. 'respect,to the Property, and :Borrower shall so perform and satisfy, .
the requirements of the companies writing such policies #hat- �at.all times companies of
good standing shall'.be willing to write or to continue such insurance.
L. Additional Insurance Borrower, shall have, the right to carry such additional
insurance as'Borrowe'r may 'desire from time to time or as may be required by any
mortgagee with a security interest in the Property.
H
•
W
71'661 -5 76,
.$200,000
Petaluma, C alifornia
2004
FOR VALUE RECEIVED, Stephen A. Lind, a'sTru8tee of -the Stephen A. Lind
94.Trust UD August 29, 19.94, andElizabeth Dick ,.anJndividual (collectively
hereinafter, "Borrower") jointly,and severally promIse to pay to the"Petai'luma
Community Development ("Agenqy"),"in lawful money of the UnitedStates
of America, the principal sum bf Hundred'Thous'and Dollars ($20,0,000) or so much
thereof as may be advAnc'6d, by Agency purs,uant:16 the Loan Agreerhentfi,ref I erred'to
below, in accordance with the terms and conditions described 'herein.
'This Secured Promissory Note (th'i's Notd")'has 0een executed and delivered' •
the terms'a ditions,o , f a 11 � Lb . a , n '
p ursu ant . to an i n accordance ' 'With� greemen t
,dated as of the date hereof by and between Rorrowor ,
a'dAgen'
n -p.y (th e- " L,o.a n
Agreement "), and is subject to the'terms".and co.nditi6hs of" the 'Loan rAgreemerft,which
W are by this reference incorporated herein and hereof. 'Cap - italized terms
used but not defined herein shall have the meaning ascribed .6 su ch in the Loan
A
greeme.nt.
This Note, is secured by a Deed of Trust, i�
As8' n
.,g m t,,o 'Ikents, Security
Agreement and Fixture'Fi[ing (."Deedlof Trust'') dated as of the he f exe cuted
reo , execut
by Borrower for the benefit of Agency and encumbering the.property d . e8cribed therein.
Agency shall be entitled to the benefits of ,he security .provi , ded,by th of'Trust
and shall have th e,, ht� to,, 6nforce,ihe covenants and agreements Contained herein in
the Deed of T'rust,and the Loan Agreement.
1._ PAYMENTS
1.1 PAYMENT DATES-; MATURITY DATE
The; entire outstanding principal
.'bal'ahce'of this:1, No"�t0gether'With 811 Interest ethn 20and 'all other sums accrue �, d! hereunder'shbll be t&; aya bl Win ful I.on the I twenti�.t) annivprsary of the date hereof
("Ma.WO ent§`� - made Under this Note fi'�.st t
. ty 1� i I I I � . o any
unpaid late Othe,r fees then due, then to ed',but un
paid.
interest if any), jhdjhen.Jo�principal.
1..2 D_IUE ON ' _ SALE.'. The,enfire unpaid principal balance : and all sums. accrued
.hore-un'd'eri �a (as defi ned in
due and q ble upon,the,Tr S-ectighTA s of fh e1oan 'i Agreemen genc t) absent y co'.0sent, of - all or any part of th
, Property o. - r the Improvempnts, or any interest there in
WV 712603,5
1.3 PREP AYMENT. Borrower may,,Without premium or pon al tY_,,at anytime
and- froMAime to time, - prepay all or portibri, of the outstanding pTjnci - P al balance due'
_
underthis Note. FrepayMents shall be,applied`fjrst to any unpaid , late , charges and
other costs and fees: -then due., then to "accrued but unpaid interest, if a'r1y,;;Efncl then to
p . jr-incipal,.. ln:po event shall any amount due,under this Note become, subject to. any
rights , of offset, deduction or counterclaim on the,'part of' Borrower.
1.4 MANNER OF PAYMENT., All payments on this Not&shall bel made lto
Agency at 11, Englisft Street, Petal'uma,'CA -9402, or such other place as Agency shall
desiahate� t o Borrower"in writing, or by wire transfer.of immediately available fundsi to.. an
account designated by Agency in writing.
9
2. DEFAULTS
,2.1 EVENTS! OF ithey one or more, Ofthe,
following ovenf� shall'cbhstuie an' eveilf"Of default hereunder ("Event of Default"):
If Borrowe'r fails to pay when due any sum payable, hereunclerancl
such failure continues for1e.n 0) days afte "r Agency notifies Borrower thereof in wrifing
'i irn6ciningof'theUriitiedStati��s
-(b.) [,f`Our�.ua'ntt orwithi n,the,
Bankruptc Code ora ny other federa or'state law relating to'in solvency% or relief of
dobfors'0'9, L
W
A
t rrinn
BorroWor (i) a' voluntary case orprdc66&hg
P Cy. -
(ii) corisentslothe entry :of'ah order f6r'relief a
' ainst Borrower in. an involuntary case;
- (iii) consents to ent of a trustee,, receiver, 'assignee, liquidator or sir
official for Borrower; (iv) makes an assignment for the benefit of its creditors;
or Y
dmitsinwritihglitSr.
a 'inability to.pay'its debts as they -become clue.
jui r e
I ' f a ' court of compeite-Qt, ' I -risdiPtion enters an otder;b - r dec under
any, Bankruptcy Law that, (i) is f6r Borrower in an involunta ,:c
c (ii)
appoints 8 trustee, receiver, assignee, liquidator or similar' official for Boreower'dr
substantially all bf"Borrowff's assets, (iii); orders the liquidation of Borrower, or (iV),
,issues or. levies ajudgment, Writ, Warrant of attachment or
similar process-against the
Property ;or the Project, andJn each case the order .or;qlec not - released, vacated,
dismissed or fully bonded- within 60 days after"its issuance.
(d) If pan event of'default has been declared 'by the. holder ,ot any , debt
instrumont: secured by a mo rtgage or -d'of trust on'the Project or-8orrower's interest
1 ,,.., �cir oL_
in the Property and'such : holder exercises a right I ht to declare alf due under that
9 ou:
debt instrument immediately due and payable, subject t&.the expiration , any
I . . . . . I I 1 - I . _ I
of
- applicable cur& period. set 1orth in such holder's documents.
(e) if the Borrower fails to maintain insurance on the Property and the
Project as `rOq
pired pursuant io-the Loan Documents and Bbrrower,fails to cure such
default within 1'5 days.
712603-5 -)q
•
(f) Subject to Borrowe-F,s right to contest the`following charges -
P o �, p y essments due
on the Property or theDmpro Verne is located therebr�,'o fa Istto pay any other charge
that may result in a Lien on; the Property, and Borrower fails to cure such default within
15 days.
(g) If any re p rese ntation or Warr anty�contaifled in the .Lo a'n' Documents
or any certificate furnished in connection with the Loan Documents or in connection with
any request for.disbursemerit of Loan Proceeds proves to' h'ave,.been false or
misleading in any material adverse respect when made.
(h) If'the Borrower defaults in�the performance of any term, provision,
�covenant or g (thdrthc�n an o l
g n�this Section 2.1
contained.iin any Loan Document, and unnlesssu h d cum . n d tlspec.ifies a shorter cure
period for such default, the default continues for:ten (10,) days imthe event of a
monetary default or thirty (30) days in the event of a nonrnonetary default after the date
upon which Agency shall ,have given written notice of the, default to. Borrower ('or such
longer.time as Agency mayiagr6e upon in writing); provided .that ' in each case Borrower
commences to ,cure fhe,default within Thirty (30) daYsT and thereafter prosecutes the
curing of such default- with'due diligence and in good faith.
If an Event he exP; any applicable d cure period any other
() o u
• Loan Document su.b'ecUb.t� irat d set forth in such
documents. m .
2.
Agency atEts the occurrence& an E
option'(i)° y ''' fCDefault hereunder,
Upon vent o
g y y, b written notice to Borrower, declare the entire unpaid
principal balance of this Note, together with all accr,,ued interest thereon and a'll sums
due hereunder, immedately:due and payable regardless of any prior forbearance, (ii)
exercise any and all rig,htsrand remedies availableto it under applicable law, and (iii)
exercise an,y,ar d all rights ;and remedies avail'ablaio Agency under this Note and the
ding without liniitationthe,right to pursue foreclosure under
the Deed. of�`Trust. Borrower
othe Loan
D ocuments,, including
_ p . y p . 1 es,. inc urred shall a all `reasonable costs and' ex erases incurred b y or
g y' 9 Note l of tri,� .d in
oo b ectio�w with A enccludin , without limitation, reasonable attorneys
s enf orcement of this' Note the exercise' y or all of its
and all such' sums shall part of the indebtedness
rights and remedies hereunder be a
secured by °the Deed of Trust.
2.3 ' DEFAULT RATE Up.onthe occurrence'of'an Event of Default, interest
shall automatically be increased without notice to th:e rate ; of ten percent (10 %) per
annum (the Default Rate ),:provided, however, if an "pay Merit due he reunder. is not
paid when due, the Default Rate, shall apply commencing upon the due date for such
payment INheri Borrower is',no,'�1onger in. default, the Default Rate shall no longer apply,
and the interest rate shall once again be the rate specified in the first paragraph of this
Note. 'Notw, "ithstai di ' the foregoing provisions, .if th;e. interest rate charged exceeds the
maxi : mum legal rate.,of interest, the rate shall be th`e maximum .rate permitted by law.
7126613 -5 0
The °im osition or acceptance of the,Default Rate shall in no. event constitute .a waiver of
P P ,
a-d efault under'this'Note or prevent: Agency from exercising any of its other rights or
remedies.
3. MISCELLANEOUS
3..1 - WAIVER . The rights and remedies of Agency unde,r Note shall! be
cumulative and not alternative: No waiver by Agency of any right or remedy v uriderth'is
Note shall beeffective .unless in =a writing, signed by Agency, Neither the failure nor any,
delay in exercising 'any right, power or privilege ,under this ,Note will o.perate,as a waiver..
of such" right, power or privilege, and no single or'pa.rtial exercise of any such right,
power or:privilege by Agency will preclude any , other or, further exercise of such right,
power or Privile °ge or the exercise ofany "other right, power or'privilege. °To the
rnazimum extent permitted _b.y applica;ble faw (a) no 'claim or right of Agency arising out
ofthis Note can be discharged by Agency,, in whole`or in part, by:a, waiver or
renunciation of the claim or right, unless in a writing, signed by Agency; (b.) no waiver
that may be given by Agency will' be the specific'instance, for which
it is gi.ven;-and. (c) , no "notice to or demand on Borrower will be deemed to be waiver of
any obli_gatiomof Borrower or cf the right of Agency to take further action wifhout
or demand as provided in this Note..., 'Borrower herebywaives presentment, demand,
protest, ngtices: of dishonor and of protest and' all defenses and pleas the grounds of
in-whole or lon art, whether b fore -.o after maturity and withy due date. underthis -Note
or without notice." •
y p y. _ t or of an ,
part", Y
3;'2. NOTICES. notice required or permitted to be given hereunder shall
be given in accordance with Section 7..1 of the Loan Agreement.
3'3. S;EVERABJILITY If any provision in'his,Note', is held invalid or
unenforceable by any: court of ;competent jurisdiction, 'the other provisions of "th's Note'
will remain in full force and effect: Any-provision of this Nbte held or
unenforceable only in'part or degree will remain 'in full force and effect to the ex_ tent not
held hvalid or unenforceable.
3, GOVERNING LAW VENUE Th`i.s, Note shall Ibe governed by the laws of
the State of California without reg"ard'to principles" of conflicts of laws. All persons and
entities in any: manner obligated under tti's Note - consent to the jurisdiction of any,
federal or state court,in the jurisdiction in which the Property is located (the "Property
Jurisdiction "). Borrower. agrees that' °anycontroversyarising underor in relation to the
Note orany 0 - ther Loan Document shall be litigated exclusively in.the. Property
Jurisdiction.: The state and federal courts and authorities with jurisdiction;in thePro'perty
Jurisdiction s:ha,ll, have exelusiye jurisdiction over a`LI controversies which shall arise
under: or in relation to the. Note and an.y ;other Loan`Docurnent. Borrowerirrevocably
consents, to iservice, jurisdiction and venue of , such courts for any such litigation and,
waives any other venue to which it might be entitled by virtue of domicile, habitual
residence or otherwise. .
7,1;2660 -5 .31
15. PARTIES IN I . NTEREST. Thi s -Note shall 'bind Borrower and its
successorsi and,, assigns 'and shall-accruej.p the � Agency and its successors
and assigns.
3_6 .. SEGTIONHEADJNGS, CONSTRUCTION.,, Thee,headings. of 'Sections in
this Note: are provided for convenience only and will not affectJ.ts,construction or
'inte'rpretation.
3.7 RELATIONSHIP THE PARTlES-.The
.IatibJ_ Ro
ship of'rrower and
,Agqncy under this: Note� is, solely that,of borrower and-Jender, and the loan evidenced by
'r Agency the Note and secured by tho T ill in no manner Make a
�usfw
p
or joint venturer of Borrower.
3.8 TIME IS .OF THE Time is of the essence with respect to every
provision of this-Note.
3.9 NONRECOURSE. Except as exprq,$§ly in th'i's Section 3.9,
Borrower shall have no personal liability for repayment ofth is and the sole
recourse of Agency ith're,s"peibt. to "the re'payrnen' o and interest (if
y w ith to the
any) on, the Note shall be to the Property and tha Improvements and any other
collateral held by'Agency as,s fpr,this,Noib; pro",Vided.hbwever, nothing contained
in the foregoing limitation .of liability shall:
(A) impair the enforcement against all such security for the Loan of all t . he rights
and reme.dies of the Agen.cyo.nder the Deed of Trust and any financing statements
Agency files in connection. on. with the Loan as each of the foregoing may be amended,
modified, or restated fromIti'm. e to time;
(B) impair the right of,Agency to bring,,a foredloso action for specific
performance; or other appropriaite action or proceeding to, enable Agency to enforce and
realize upon the Deed of rust th6 interest in the Property thereby and any
other collateral given to Agency in connection with ,the indebtedness evidenced by this
Note, and to name the; BorroWier as party defend a i n in 'any' such action';
(C) bbil,Oeem,e in an t the right bf,the,A
y Way o impair gOridy to assert the unpaid
principal arnou nt of the,.Lba'6`;a'8 a derhand fdr money within the meaning of Section
431.70 of the California,,: Code of Civil Procedurer!"d(r anytuccessor provision, thereto;
(D) constitute f th y right which Agencyrmay have, under any a qy , ' bankruptcy law to fileia, cla im for e full amount of th&Jridebtedness owed tb,.Agen Agen
under this Note orfo ir I ethbt the Property,and the ,Improvements , �shall continue to
secure all .of thefi owed to Agency in' 'accordance with thi's Note and'th,e
Deed of Trust;: or
• ( f Agency seek. 8 judgment against
E) li mit l � or restric t the,
Bbrrower to enforce against B6rroWer'to'.
32
recover brider'S of the Loa.n.Agreement
j
(pertaining to,Borrower's inderrin'ification obligations), or
(b) recover from% Borrowpr cbmpehsatory d amages :as wel las other costs
and expenses incurred by Agency (including, without limitation attOrney"s fees
and expenses) .,,ari$i . n,g as a result offhe -occurrence of any of the fo llowing:
.
a'&J'al rn '
(,i,.)'an,y fraud, or,.m.. _'i on -the part .of the
r, a uthorized. representative entative � 'of Borrower in' connection with
Borrower, any a s
the request for or creation of the Lo'an, or in any Loan Dbcu.*M6ht or in
connection with any request for ahy action or consent by Agency in
connection with the Loan,;
l(ii') any failure to maintain, insurance on - the Properly,a's- required
-pursuant to the rLoan Documents;
(iii) failure to pay assessments or other charges dU I b, oh.j. . he,
Property and Improvements;
(iv) the presence�of hazardous .or toxic rriateria(i or waste On the
Property of f other vjoIatib,n,,ofthe Borrower's o,blig6tions 4.13
, of the'Loan Agreement or Section 7.11 of the Deed of Trust (pertaini . ,to
en viron m en tal ma1ters);
.
(:v) the.occurrerice of any act or omission of Borrower that results s in
waste to or of the Property or the Improvements and which has a material
adverse effect on the value of 111e, Propefty or the I mprovements;
_i) oval 'or disposa'! of any personal propertyo r fixtures in
Q
violatiop of the Deed of Trust;
(vii) the material [ ion of the Loan Proc
(viii) the material, misapplication of the'praceed's of any insurance
policy or 8Watd're'8ulting from corider.fth or the exercise I , of the power -
of eminentdQmain reason of damage, Iciss or destruction'to any
portion of the Property orthe Improvements.
4'. 'WAIVER OF TRIAL BY'JU BORROWER AND AGENCYEACH (A) AGREE NOT
TO ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS
.NOTE OR THE RELA TIONSHIP BETWEE THE PARTIES AS' LENDERAND BORROWER
THAT IS TRIABLE.01F'RIGHT BY &JURY, AND (B) WAIVE ANY RIGHT TO TRIAL BY JURY
WITH RESPEQTTO'SUCH ISSUE. TO THE 7 THAT ANY
WRIGHT EXISTS*
NOW OR IN THE FUTURE., THIS 'WAIVER OF RIGHT TO TRIAL BY.JURY IS SEPARATELY
712663 33
S _ GIVEN BY EACH PARTY, KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF
COMPETENTIEGAL COUNSEL,
IN WITNESS WHEREOF, Borrower has executed and delivered this Note as of
the date first written above.
BORROWER
SPECIMEN FORM
STEPHEN A. LIND 1`994 TRUST'
U/T /D August 29, 1994
By:
Stephen A. Lind, Trustee
Exhibit E
FORM OF DEED OF'TRUST
•
E xhibit F
PERMITTED EXCEPTIONS