HomeMy WebLinkAbout0014_10_DDL Affordable Housing - Exhibit I Deed of Trust1603\27\1893314.3
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EXHIBIT G
FORM OF CITY DEED OF TRUST
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
City of Lake Elsinore
130 South Main Street
Lake Elsinore, CA 92530
Attention: City Manager
No fee for recording pursuant to
Government Code Section 27383
APN:365-030-001 (Space above for Recorder's Use)
DEED OF TRUST WITH ASSIGNMENT OF RENTS,
SECURITY AGREEMENT, AND FIXTURE FILING
(Mission Trail - City Land Loan)
THIS DEED OF TRUST WITH ASSIGNMENT OF RENTS, SECURITY
AGREEMENT, AND FIXTURE FILING ("Deed of Trust") is made as of this ___day of
____________, 20___, by and among ______________________________________________,
a California limited partnership ("Trustor"), Ticor Title Company of California, a California
corporation ("Trustee"), and the City of Lake Elsinore, a municipal corporation ("Beneficiary").
FOR GOOD AND VALUABLE CONSIDERATION, including the indebtedness herein
recited and the trust herein created, the receipt of which is hereby acknowledged, Trustor hereby
irrevocably grants, transfers, conveys and assigns to Trustee, IN TRUST, WITH POWER OF
SALE, for the benefit and security of Beneficiary, under and subject to the terms and conditions
hereinafter set forth, Trustor's fee interest in the property located in the City of Lake Elsinore,
County of Riverside, State of California, that is described in the attached Exhibit A, incorporated
herein by this reference (the "Property").
TOGETHER WITH all interest, estates or other claims, both in law and in equity which
Trustor now has or may hereafter acquire in the Property and the rents;
TOGETHER WITH all easements, rights-of-way and rights used in connection therewith
or as a means of access thereto, including (without limiting the generality of the foregoing) all
tenements, hereditaments and appurtenances thereof and thereto;
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TOGETHER WITH any and all buildings and improvements of every kind and
description now or hereafter erected thereon, and all property of the Trustor now or hereafter
affixed to or placed upon the Property;
TOGETHER WITH all building materials and equipment now or hereafter delivered to
said property and intended to be installed therein;
TOGETHER WITH all right, title and interest of Trustor, now owned or hereafter
acquired, in and to any land lying within the right-of-way of any street, open or proposed,
adjoining the Property, and any and all sidewalks, alleys and strips and areas of land adjacent to
or used in connection with the Property;
TOGETHER WITH all estate, interest, right, title, other claim or demand, of every
nature, in and to such property, including the Property, both in law and in equity, including, but
not limited to, all deposits made with or other security given by Trustor to utility companies, the
proceeds from any or all of such property, including the Property, claims or demands with
respect to the proceeds of insurance in effect with respect thereto, which Trustor now has or may
hereafter acquire, any and all awards made for the taking by eminent domain or by any
proceeding or purchase in lieu thereof of the whole or any part of such property, including
without limitation, any awards resulting from a change of grade of streets and awards for
severance damages to the extent Beneficiary has an interest in such awards for taking as
provided in Paragraph 4.1 herein;
TOGETHER WITH all of Trustor's interest in all articles of personal property or fixtures
now or hereafter attached to or used in and about the building or buildings now erected or
hereafter to be erected on the Property which are necessary to the complete and comfortable use
and occupancy of such building or buildings for the purposes for which they were or are to be
erected, including all other goods and chattels and personal property as are ever used or
furnished in operating a building, or the activities conducted therein, similar to the one herein
described and referred to, and all renewals or replacements thereof or articles in substitution
therefor, whether or not the same are, or shall be attached to said building or buildings in any
manner; and
TOGETHER WITH all of Trustor's interest in all building materials, fixtures, equipment,
work in process and other personal property to be incorporated into the Property; all goods,
materials, supplies, fixtures, equipment, machinery, furniture and furnishings, signs and other
personal property now or hereafter appropriated for use on the Property, whether stored on the
Property or elsewhere, and used or to be used in connection with the Property; all rents, issues
and profits, and all inventory, accounts, accounts receivable, contract rights, general intangibles,
chattel paper, instruments, documents, notes drafts, letters of credit, insurance policies, insurance
and condemnation awards and proceeds, trade names, trademarks and service marks arising from
or related to the Property and any business conducted thereon by Trustor; all replacements,
additions, accessions and proceeds; and all books, records and files relating to any of the
foregoing.
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All of the foregoing, together with the Property, is herein referred to as the "Security."
To have and to hold the Security together with acquittances to the Trustee, its successors and
assigns forever.
FOR THE PURPOSE OF SECURING:
(a)Payment of just indebtedness of Trustor to Beneficiary as set forth in the Note
(defined in Article 1 below) until paid or cancelled. Principal and Interest (defined in Article 1
below) and other payments shall be due and payable as provided in the Note. Said Note and all
their terms are incorporated herein by reference, and this conveyance shall secure any and all
extensions thereof, however evidenced; and
(b)Payment of any sums advanced by Beneficiary to protect the Security pursuant to
the terms and provisions of this Deed of Trust following a breach of Trustor's obligation to
advance said sums and the expiration of any applicable cure period, with interest thereon as
provided herein; and
(c)Performance of every obligation, covenant or agreement of Trustor contained
herein and in the Loan Documents (defined in Article 1 below).
(d) Payment and performance of all future advances and other obligations that Trustor, or
any successor in interest to Trustor, and/or any other obligor (if different than Trustor), or any
successor in ownership of all or part of the Property, may agree to pay and/or perform (whether
as principal, surety, or guarantor) for the benefit of Beneficiary, when a writing evidences the
parties’ agreement that the advance or obligation be secured by this Deed of Trust; and
(e) Payment and performance of all modifications, amendments, extensions, and
renewals, however evidenced, of any of the secured obligations, including any successor
agreements or instruments which restate and supersede any agreements or instruments
evidencing the Secured Obligations; and
(f) Payment of all sums advanced by Beneficiary to protect the security of this Deed of
Trust or the Property, with interest at the Default Rate as defined in the Note.
AND TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR
COVENANTS AND AGREES:
ARTICLE 1
DEFINITIONS
In addition to the terms defined elsewhere in this Deed of Trust, the following terms shall
have the following meanings in this Deed of Trust:
Section 1.1 The term "DDLA" means the Disposition, Development and Loan
Agreement dated as of ___________ ___, 2016, as amended from time to time, providing for the
Beneficiary to make three loans to the Trustor for the acquisition and development of the
Property. This Deed of Trust is referred to as the "City Deed of Trust" in the DDLA.
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Section 1.2 The term "Loan Documents" means this Deed of Trust, the Note, the
DDLA, the Regulatory Agreement, and any other regulatory agreement, use restrictions
agreement, debt, loan or security instruments between Trustor and the Beneficiary relating to the
Property.
Section 1.3 The term "Note" means the promissory note dated of even date herewith
executed by the Trustor in favor of the Beneficiary, the payment of which is secured by this
Deed of Trust. (Copies of the Note are on file with the Beneficiary and terms and provisions of
the Note are incorporated herein by reference.). The Note is referred to as the "City Note",
consisting of the "City Land Note" in the original principal amount of amount of Two Million
Dollars ($2,000,000), as referred to in the DDLA.
Section 1.4 The term "Principal and Interest" means the aggregate of the amounts
required to be paid under the Note.
Section 1.5 The term "Regulatory Agreement" means the regulatory agreement and
declaration of restrictive covenants, of even date herewith, by and between the Trustor and the
Beneficiary, recorded against the Property.
ARTICLE 2
MAINTENANCE AND MODIFICATION OF THE PROPERTY
AND SECURITY
Section 2.1 Maintenance and Modification of the Property by Trustor.
The Trustor agrees that at all times prior to full payment of the sums owed under the
Note, the Trustor will, at the Trustor's own expense, maintain, preserve and keep the Security or
cause the Security to be maintained and preserved in good condition. The Trustor will from time
to time make or cause to be made all repairs, replacements and renewals deemed proper and
necessary by it. The Beneficiary shall have no responsibility in any of these matters or for the
making of improvements or additions to the Security.
Trustor agrees to pay fully and discharge (or cause to be paid fully and discharged) all
claims for labor done and for material and services furnished in connection with the Security,
diligently to file or procure the filing of a valid notice of cessation upon the event of a cessation
of labor on the work or construction on the Security for a continuous period of thirty (30) days or
more, and to take all other reasonable steps to forestall the assertion of claims of lien against the
Security of any part thereof. Trustor irrevocably appoints, designates and authorizes Beneficiary
as its agent (said agency being coupled with an interest) with the authority, but without any
obligation, to file for record any notices of completion or cessation of labor or any other notice
that Beneficiary deems necessary or desirable to protect its interest in and to the Security or the
Loan Documents; provided, however, that Beneficiary shall exercise its rights as agent of Trustor
only in the event that Trustor shall fail to take, or shall fail to diligently continue to take, those
actions as hereinbefore provided.
Upon demand by Beneficiary, Trustor shall make or cause to be made such demands or
claims as Beneficiary shall specify upon laborers, materialmen, subcontractors or other persons
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who have furnished or claim to have furnished labor, services or materials in connection with the
Security. Nothing herein contained shall require Trustor to pay any claims for labor, materials or
services which Trustor in good faith disputes and is diligently contesting provided that Trustor
shall, within thirty (30) days after the filing of any claim of lien, record in the Office of the
Recorder of Riverside County, a surety bond in an amount 1 and 1/2 times the amount of such
claim item to protect against a claim of lien.
Section 2.2 Granting of Easements.
Trustor may not grant easements, licenses, rights-of-way or other rights or privileges in
the nature of easements with respect to any property or rights included in the Security except
those required or desirable for installation and maintenance of public utilities including, without
limitation, water, gas, electricity, sewer, telephone and telegraph, or those required by law and as
approved, in writing, by Beneficiary.
Section 2.3 Assignment of Rents.
As part of the consideration for the indebtedness evidenced by the Note, Trustor hereby
absolutely and unconditionally assigns and transfers to Beneficiary all the rents and revenues of
the Property including those now due, past due, or to become due by virtue of any lease or other
agreement for the occupancy or use of all or any part of the Property, regardless of to whom the
rents and revenues of the Property are payable. Trustor hereby authorizes Beneficiary or
Beneficiary's agents to collect the aforesaid rents and revenues and hereby directs each tenant of
the Property to pay such rents to Beneficiary or Beneficiary's agents; provided, however, that
prior to written notice given by Beneficiary to Trustor of the breach by Trustor of any covenant
or agreement of Trustor in the Loan Documents, Trustor shall collect and receive all rents and
revenues of the Property as trustee for the benefit of Beneficiary and Trustor shall apply the rents
and revenues so collected to the sums secured by this Deed of Trust with the balance, so long as
no such breach has occurred, to the account of Trustor, it being intended by Trustor and
Beneficiary that this assignment of rents constitutes an absolute assignment and not an
assignment for additional security only. Upon delivery of written notice by Beneficiary to
Trustor of the breach by Trustor of any covenant or agreement of Trustor in the Loan
Documents, and without the necessity of Beneficiary entering upon and taking and maintaining
full control of the Property in person, by agent or by a court-appointed receiver, Beneficiary shall
immediately be entitled to possession of all rents and revenues of the Property as specified in this
Section 2.3 as the same becomes due and payable, including but not limited to rents then due and
unpaid, and all such rents shall immediately upon delivery of such notice be held by Trustor as
trustee for the benefit of Beneficiary only; provided, however, that the written notice by
Beneficiary to Trustor of the breach by Trustor shall contain a statement that Beneficiary
exercises its rights to such rents. Trustor agrees that commencing upon delivery of such written
notice of Trustor's breach by Beneficiary to Trustor, each tenant of the Property shall make such
rents payable to and pay such rents to Beneficiary or Beneficiary's agents on Beneficiary's
written demand to each tenant therefor, delivered to each tenant personally, by mail or by
delivering such demand to each rental unit, without any liability on the part of said tenant to
inquire further as to the existence of a default by Trustor.
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Except for the financing previously approved by the Beneficiary, Trustor hereby
covenants that Trustor has not executed any prior assignment of said rents, that Trustor has not
performed, and will not perform, any acts or has not executed and will not execute, any
instrument which would prevent Beneficiary from exercising its rights under this Section 2.3,
and that at the time of execution of this Deed of Trust, there has been no anticipation or
prepayment of any of the rents of the Property for more than two (2) months prior to the due
dates of such rents. Trustor covenants that Trustor will not hereafter collect or accept payment
of any rents of the Property more than two (2) months prior to the due dates of such rents.
Trustor further covenants that Trustor will execute and deliver to Beneficiary such further
assignments of rents and revenues of the Property as Beneficiary may from time to time request.
Upon Trustor's breach of any covenant or agreement of Trustor in the Loan Documents,
Beneficiary may in person, by agent or by a court-appointed receiver, regardless of the adequacy
of Beneficiary's security, enter upon and take and maintain full control of the Property in order to
perform all acts necessary and appropriate for the operation and maintenance thereof including,
but not limited to, the execution, cancellation or modification of leases, the collection of all rents
and revenues of the Property, the making of repairs to the Property and the execution or
termination of contracts providing for the management or maintenance of the Property, all on
such terms as are deemed best to protect the security of this Deed of Trust. In the event
Beneficiary elects to seek the appointment of a receiver for the Property upon Trustor's breach of
any covenant or agreement of Trustor in this Deed of Trust, Trustor hereby expressly consents to
the appointment of such receiver. Beneficiary or the receiver shall be entitled to receive a
reasonable fee for so managing the Property.
All rents and revenues collected subsequent to delivery of written notice by Beneficiary
to Trustor of the breach by Trustor of any covenant or agreement of Trustor in the Loan
Documents shall be applied first to the costs, if any, of taking control of and managing the
Property and collecting the rents, including, but not limited to, attorney's fees, receiver's fees,
premiums on receiver's bonds, costs of repairs to the Property, premiums on insurance policies,
taxes, assessments and other charges on the Property, and the costs of discharging any obligation
or liability of Trustor as lessor or landlord of the Property and then to the sums secured by this
Deed of Trust, and thereafter, to subordinate deeds of trust, if any. Beneficiary or the receiver
shall have access to the books and records used in the operation and maintenance of the Property
and shall be liable to account only for those rents actually received. Beneficiary shall not be
liable to Trustor, anyone claiming under or through Trustor or anyone having an interest in the
Property by reason of anything done or left undone by Beneficiary under this Section 2.3.
If the rents of the Property are not sufficient to meet the costs, if any, of taking control of
and managing the Property and collecting the rents, any funds expended by Beneficiary for such
purposes shall become indebtedness of Trustor to Beneficiary secured by this Deed of Trust
pursuant to Section 3.3 hereof. Unless Beneficiary and Trustor agree in writing to other terms of
payment, such amounts shall be payable upon notice from Beneficiary to Trustor requesting
payment thereof and shall bear interest from the date of disbursement at the rate stated in
Section 3.3.
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Any entering upon and taking and maintaining of control of the Property by Beneficiary
or the receiver and any application of rents as provided herein shall not cure or waive any default
hereunder or invalidate any other right or remedy of Beneficiary under applicable law or
provided herein. This assignment of rents of the Property shall terminate at such time as this
Deed of Trust ceases to secure indebtedness held by Beneficiary. The rights of the Beneficiary
under this Section 2.3 are subject to the rights of any senior mortgage lender.
ARTICLE 3
TAXES AND INSURANCE; ADVANCES
Section 3.1 Taxes, Other Governmental Charges and Utility Charges.
Trustor shall pay, or cause to be paid, at least five (5) days prior to the date of
delinquency, all taxes, assessments, charges and levies imposed by any public authority or utility
company which are or may become a lien affecting the Security or any part thereof; provided,
however, that Trustor shall not be required to pay and discharge any such tax, assessment, charge
or levy so long as (a) the legality thereof shall be promptly and actively contested in good faith
and by appropriate proceedings, and (b) Trustor maintains reserves adequate to pay any liabilities
contested pursuant to this Section 3.1. With respect to taxes, special assessments or other similar
governmental charges, Trustor shall pay such amount in full prior to the attachment of any lien
therefor on any part of the Security; provided, however, if such taxes, assessments or charges
may be paid in installments, Trustor may pay in such installments. Except as provided in clause
(b) of the first sentence of this paragraph, the provisions of this Section 3.1 shall not be construed
to require that Trustor maintain a reserve account, escrow account, impound account or other
similar account for the payment of future taxes, assessments, charges and levies.
In the event that Trustor shall fail to pay any of the foregoing items required by this
Section to be paid by Trustor, Beneficiary may (but shall be under no obligation to) pay the
same, after the Beneficiary has notified the Trustor of such failure to pay and the Trustor fails to
fully pay such items within seven (7) business days after receipt of such notice. Any amount so
advanced therefor by Beneficiary, together with interest thereon from the date of such advance at
the maximum rate permitted by law, shall become an additional obligation of Trustor to the
Beneficiary and shall be secured hereby, and Trustor agrees to pay all such amounts.
Section 3.2 Provisions Respecting Insurance.
Trustor agrees to provide insurance conforming in all respects to that required under the
Loan Documents during the course of construction and following completion, and at all times
until all amounts secured by this Deed of Trust have been paid and all other obligations secured
hereunder fulfilled, and this Deed of Trust reconveyed.
All such insurance policies and coverages shall be maintained at Trustor's sole cost and
expense. Certificates of insurance for all of the above insurance policies, showing the same to be
in full force and effect, shall be delivered to the Beneficiary upon demand therefor at any time
prior to the Beneficiary's receipt of the entire Principal and Interest and all amounts secured by
this Deed of Trust.
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Section 3.3 Advances.
In the event the Trustor shall fail to maintain the full insurance coverage required by this
Deed of Trust or shall fail to keep the Security in accordance with the Loan Documents, the
Beneficiary, after at least seven (7) days prior notice to Beneficiary, may (but shall be under no
obligation to) take out the required policies of insurance and pay the premiums on the same or
may make such repairs or replacements as are necessary and provide for payment thereof; and all
amounts so advanced therefor by the Beneficiary shall become an additional obligation of the
Trustor to the Beneficiary (together with interest as set forth below) and shall be secured hereby,
which amounts the Trustor agrees to pay on the demand of the Beneficiary, and if not so paid,
shall bear interest from the date of the advance at the lesser of ten percent (10%) per annum or
the maximum rate permitted by law.
ARTICLE 4
DAMAGE, DESTRUCTION OR CONDEMNATION
Section 4.1 Awards and Damages.
All judgments, awards of damages, settlements and compensation made in connection
with or in lieu of (1) taking of all or any part of or any interest in the Property by or under
assertion of the power of eminent domain, (2) any damage to or destruction of the Property or in
any part thereof by insured casualty, and (3) any other injury or damage to all or any part of the
Property ("Funds") are hereby assigned to and shall be paid to the Beneficiary by a check made
payable to the Beneficiary. Subject to the rights of any senior lenders, such Funds (if any) shall
be applied to restoration or repair of the Property damaged, provided such restoration or repair is
economically feasible and the security of this Deed of Trust is not thereby impaired, as
determined in the Beneficiary's reasonable discretion. If such restoration or repair is not
economically feasible or if the security of this Deed of Trust would be impaired, the insurance
proceeds will be used to repay any amounts due under this Deed of Trust with the excess, if any,
paid to Trustor. The Beneficiary shall be entitled to settle and adjust all claims under insurance
policies provided under this Deed of Trust and may deduct and retain from the proceeds of such
insurance the amount of all expenses incurred by it in connection with any such settlement or
adjustment. All or any part of the amounts so collected and recovered by the Beneficiary may be
released to Trustor upon such conditions as the Beneficiary may impose for its disposition.
Application of all or any part of the Funds collected and received by the Beneficiary or the
release thereof shall not cure or waive any default under this Deed of Trust. The rights of the
Beneficiary under this Section 4.1 are subject to the rights of any senior mortgage lender.
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ARTICLE 5
AGREEMENTS AFFECTING THE PROPERTY; FURTHER
ASSURANCES; PAYMENT OF PRINCIPAL AND INTEREST
Section 5.1 Other Agreements Affecting Property.
The Trustor shall duly and punctually perform all terms, covenants, conditions and
agreements binding upon it under the Loan Documents and any other agreement of any nature
whatsoever now or hereafter involving or affecting the Security or any part thereof.
Section 5.2 Agreement to Pay Attorneys' Fees and Expenses.
In the event of any Event of Default (as defined below) hereunder, and if the Beneficiary
should employ attorneys or incur other expenses for the collection of amounts due or the
enforcement of performance or observance of an obligation or agreement on the part of the
Trustor in this Deed of Trust, the Trustor agrees that it will, on demand therefor, pay to the
Beneficiary the reasonable fees of such attorneys and such other reasonable expenses so incurred
by the Beneficiary; and any such amounts paid by the Beneficiary shall be added to the
indebtedness secured by the lien of this Deed of Trust, and shall bear interest from the date such
expenses are incurred at the lesser of ten percent (10%) per annum or the maximum rate
permitted by law.
Section 5.3 Payment of the Principal and Interest.
The Trustor shall pay to the Beneficiary the Principal and Interest and any other
payments as set forth in the Note in the amounts and by the times set out therein.
Section 5.4 Personal Property.
To the maximum extent permitted by law, the personal property subject to this Deed of
Trust shall be deemed to be fixtures and part of the real property and this Deed of Trust shall
constitute a fixtures filing under the California Commercial Code. As to any personal property
not deemed or permitted to be fixtures, this Deed of Trust shall constitute a security agreement
under the California Commercial Code. The Trustor hereby grants the Beneficiary a security
interest in such items.
Section 5.5 Financing Statement.
The Trustor shall execute and deliver to the Beneficiary such financing statements
pursuant to the appropriate statutes, and any other documents or instruments as are required to
convey to the Beneficiary a valid perfected security interest in the Security. The Trustor agrees
to perform all acts which the Beneficiary may reasonably request so as to enable the Beneficiary
to maintain such valid perfected security interest in the Security to secure the payment of the
Note in accordance with their terms. The Beneficiary is authorized to file a copy of any such
financing statement in any jurisdiction(s) as it shall deem appropriate from time to time in order
to protect the security interest established pursuant to this instrument. Trustor shall pay all costs
of filing such financing statements and any extensions, renewals, amendments, and releases
thereof, and shall pay all reasonable costs and expenses of any record searches for financing
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statements, and releases thereof, as the Beneficiary may reasonably require. Without the prior
written consent of the Beneficiary, Trustor shall not create or suffer to be created pursuant to the
California Commercial Code any other security interest in the Security, including replacements
and additions thereto.
Section 5.6 Operation of the Security.
The Trustor shall operate the Security (and, in case of a transfer of a portion of the
Security subject to this Deed of Trust, the transferee shall operate such portion of the Security) in
full compliance with the Loan Documents.
Section 5.7 Inspection of the Security.
At any and all reasonable times upon seventy-two (72) hours' written notice, the
Beneficiary and its duly authorized agents, attorneys, experts, engineers, accountants and
representatives, shall have the right, without payment of charges or fees, to inspect the Security.
Such right shall be in addition to any inspection right granted to the Beneficiary pursuant to the
DDLA.
Section 5.8 Nondiscrimination.
Trustor herein covenants by and for itself, its heirs, executors, administrators, and
assigns, and all persons claiming under or through them, that there shall be no discrimination
against or segregation of, any person or group of persons on account any basis listed in
subdivision (a) or (d) of Section 12955 of the California Government Code, as those bases are
defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of
Section 12955, Section 12955.2 and Section 12955.3 of the California Government Code, nor
shall the Trustor or any person claiming under or through the Trustor establish or permit any
such practice or practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the
Property. With respect to familial status, this Section 5.8 shall not be construed to apply to
housing for older persons, as defined in Section 12955.9 of the California Government Code.
With respect to familial status, nothing in this Section shall be construed to affect Sections 51.2,
51.3, 51.4, 51.10, 51.11, and 799.5 of the California Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51, and subdivisions (n), (o), and (p) of Section 12955 of the
California Government Code shall apply to this Section 5.8. The foregoing covenants shall run
with the land.
ARTICLE 6
HAZARDOUS WASTE
Trustor shall keep and maintain the Property in compliance with, and shall not cause or
permit the Property to be in violation of any federal, state or local laws, ordinances or regulations
relating to industrial hygiene or to the environmental conditions on, under or about the Property
including, but not limited to, soil and ground water conditions. Trustor shall not use, generate,
manufacture, store or dispose of on, under, or about the Property or transport to or from the
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Property any flammable explosives, radioactive materials, hazardous wastes, toxic substances or
related materials, including without limitation, any substances defined as or included in the
definition of "hazardous substances," hazardous wastes," "hazardous materials," or "toxic
substances" under any applicable federal or state laws or regulations (collectively referred to
hereinafter as "Hazardous Materials") except such of the foregoing as may be customarily kept
and used in and about multi-family residential property.
Trustor shall immediately advise Beneficiary in writing if at any time it receives written
notice of (i) any and all enforcement, cleanup, removal or other governmental or regulatory
actions instituted, completed or threatened against Trustor or the Property pursuant to any
applicable federal, state or local laws, ordinances, or regulations relating to any Hazardous
Materials, ("Hazardous Materials Law"); (ii) all claims made or threatened by any third party
against Trustor or the Property relating to damage, contribution, cost recovery compensation,
loss or injury resulting from any Hazardous Materials (the matters set forth in clauses (i) and (ii)
above are hereinafter referred to a "Hazardous Materials Claims"); and (iii) Trustor's discovery
of any occurrence or condition that could cause the Property or any part thereof to be subject to a
land use restriction pursuant to California Health and Safety Code, Sections 25220 et seq. or any
regulation adopted in accordance therewith, or to be otherwise subject to any restrictions on the
ownership, occupancy, transferability or use of the Property under any Hazardous Materials
Law.
Beneficiary shall have the right to join and participate in, as a party if it so elects, any
legal proceedings or actions initiated in connection with any Hazardous Materials Claims and to
have its reasonable attorneys' fees in connection therewith paid by Trustor. Trustor shall
indemnify and hold harmless Beneficiary and its council members, supervisors, directors,
officers, employees, agents, successors and assigns from and against any loss, damage, cost,
expense or liability directly or indirectly arising out of or attributable to the use, generation,
storage, release, threatened release, discharge, disposal, or presence of Hazardous Materials on,
under, or about the Property including without limitation: (a) all foreseeable consequential
damages; (b) the costs of any required or necessary repair, cleanup or detoxification of the
Property and the preparation and implementation of any closure, remedial or other required
plans; and (c) all reasonable costs and expenses incurred by Beneficiary in connection with
clauses (a) and (b), including but not limited to reasonable attorneys' fees.
Without Beneficiary's prior written consent, which shall not be unreasonably withheld,
Trustor shall not take any remedial action in response to the presence of any Hazardous
Materials on, under or about the Property, nor enter into any settlement agreement, consent
decree, or other compromise in respect to any Hazardous Material Claims, which remedial
action, settlement, consent decree or compromise might, in Beneficiary's reasonable judgment,
impair the value of the Beneficiary's security hereunder; provided, however, that Beneficiary's
prior consent shall not be necessary in the event that the presence of Hazardous Materials on,
under, or about the Property either poses an immediate threat to the health, safety or welfare of
any individual or is of such a nature that an immediate remedial response is necessary and it is
not reasonably possible to obtain Beneficiary's consent before taking such action, provided that
in such event Trustor shall notify Beneficiary as soon as practicable of any action so taken.
Beneficiary agrees not to withhold its consent, where such consent is required hereunder, if
either (i) a particular remedial action is ordered by a court of competent jurisdiction, (ii) Trustor
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will or may be subjected to civil or criminal sanctions or penalties if it fails to take a required
action; (iii) Trustor establishes to the reasonable satisfaction of Beneficiary that there is no
reasonable alternative to such remedial action which would result in less impairment of
Beneficiary's security hereunder; or (iv) the action has been agreed to by Beneficiary.
The Trustor hereby acknowledges and agrees that (i) this Article is intended as the
Beneficiary's written request for information (and the Trustor's response) concerning the
environmental condition of the Property as required by California Code of Civil Procedure
Section 726.5, and (ii) each representation and warranty in this Deed of Trust or any of the other
Loan Documents (together with any indemnity applicable to a breach of any such representation
and warranty) with respect to the environmental condition of the property is intended by the
Beneficiary and the Trustor to be an "environmental provision" for purposes of California Code
of Civil Procedure Section 736.
In the event that any portion of the Property is determined to be "environmentally
impaired" (as that term is defined in California Code of Civil Procedure Section 726.5(e)(3)) or
to be an "affected parcel" (as that term is defined in California Code of Civil Procedure Section
726.5(e)(1)), then, without otherwise limiting or in any way affecting the Beneficiary's or the
Trustee's rights and remedies under this Deed of Trust, the Beneficiary may elect to exercise its
rights under California Code of Civil Procedure Section 726.5(a) to (1) waive its lien on such
environmentally impaired or affected portion of the Property and (2) exercise (a) the rights and
remedies of an unsecured creditor, including reduction of its claim against the Trustor to
judgment, and (b) any other rights and remedies permitted by law. For purposes of determining
the Beneficiary's right to proceed as an unsecured creditor under California Code of Civil
Procedure Section 726.5(a), the Trustor shall be deemed to have willfully permitted or
acquiesced in a release or threatened release of hazardous materials, within the meaning of
California Code of Civil Procedure Section 726.5(d)(1), if the release or threatened release of
hazardous materials was knowingly or negligently caused or contributed to by any lessee,
occupant, or user of any portion of the Property and the Trustor knew or should have known of
the activity by such lessee, occupant, or user which caused or contributed to the release or
threatened release. All costs and expenses, including (but not limited to) attorneys' fees, incurred
by the Beneficiary in connection with any action commenced under this paragraph, including any
action required by California Code of Civil Procedure Section 726.5(b) to determine the degree
to which the Property is environmentally impaired, plus interest thereon at the rate specified in
the Note until paid, shall be added to the indebtedness secured by this Deed of Trust and shall be
due and payable to the Beneficiary upon its demand made at any time following the conclusion
of such action.
The Trustor is aware that California Civil Code Section 2955.5(a) provides as follows:
"No lender shall require a borrower, as a condition of receiving or maintaining a loan secured by
real property, to provide hazard insurance coverage against risks to the improvements on that
real property in an amount exceeding the replacement value of the improvements on the
property."
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ARTICLE 7
EVENTS OF DEFAULT AND REMEDIES
Section 7.1 Events of Default.
The following shall constitute Events of Default following the expiration of any
applicable notice and cure periods: (1) failure to make any payment to be paid by Trustor under
the Loan Documents; (2) failure to observe or perform any of Trustor's other covenants,
agreements or obligations under the Loan Documents; or (3) failure to make any payment or
perform any of Trustor's other covenants, agreements, or obligations under any other debt
instruments or regulatory agreement secured by the Property, which default shall not be cured
within the times and in the manner provided therein.
Section 7.2 Acceleration of Maturity.
If an Event of Default shall have occurred and be continuing, then at the option of the
Beneficiary, the amount of any payment related to the Event of Default and the unpaid Principal
and Interest of the Note shall immediately become due and payable, upon written notice by the
Beneficiary to the Trustor (or automatically where so specified in the Loan Documents), and no
omission on the part of the Beneficiary to exercise such option when entitled to do so shall be
construed as a waiver of such right.
Section 7.3 The Beneficiary's Right to Enter and Take Possession.
If an Event of Default shall have occurred and be continuing, the Beneficiary may:
(a)Either in person or by agent, with or without bringing any action or
proceeding, or by a receiver appointed by a court, and without regard to the adequacy of its
security, enter upon the Security and take possession thereof (or any part thereof) and of any of
the Security, in its own name or in the name of Trustee, and do any acts which it deems
necessary or desirable to preserve the value or marketability of the Property, or part thereof or
interest therein, increase the income therefrom or protect the security thereof. The entering upon
and taking possession of the Security shall not cure or waive any Event of Default or Notice of
Default and Election to Sell (as defined below) hereunder or invalidate any act done in response
to such Default or pursuant to such Notice of Default and Election to Sell and, notwithstanding
the continuance in possession of the Security, Beneficiary shall be entitled to exercise every right
provided for in this Deed of Trust, or by law upon occurrence of any Event of Default, including
the right to exercise the power of sale;
(b)Commence an action to foreclose this Deed of Trust as a mortgage,
appoint a receiver, or specifically enforce any of the covenants hereof;
(c)Deliver to Trustee a written declaration of default and demand for sale,
and a written notice of default and election to cause Trustor's interest in the Security to be sold
("Notice of Default and Election to Sell"), which notice Trustee or Beneficiary shall cause to be
duly filed for record in the Official Records of Riverside County; or
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(d)Exercise all other rights and remedies provided herein, in the instruments
by which the Trustor acquires title to any Security, or in any other document or agreement now
or hereafter evidencing, creating or securing all or any portion of the obligations secured hereby,
or provided by law.
Section 7.4 Foreclosure By Power of Sale.
Should the Beneficiary elect to foreclose by exercise of the power of sale herein
contained, the Beneficiary shall give to the Trustee the Notice of Default and Election to Sell and
shall deposit with Trustee this Deed of Trust which is secured hereby (and the deposit of which
shall be deemed to constitute evidence that the unpaid Principal and Interest amount of the Note
is immediately due and payable), and such receipts and evidence of any expenditures made that
are additionally secured hereby as Trustee may require.
(a)Upon receipt of such notice from the Beneficiary, Trustee shall cause to be
recorded, published and delivered to Trustor such Notice of Default and Election to Sell, as then
required by law and by this Deed of Trust. Trustee shall, without demand on Trustor, after lapse
of such time as may then be required by law and after recordation of such Notice of Default and
Election to Sell and after such notice having been given as required by law, sell the Security, at
the time and place of sale fixed by it in said Notice of Default and Election to Sell, whether as a
whole or in separate lots or parcels or items as Trustee shall deem expedient and in such order as
it may determine unless specified otherwise by the Trustor according to California Civil Code
Section 2924g(b), at public auction to the highest bidder, for cash in lawful money of the United
States payable at the time of sale. Trustee shall deliver to such purchaser or purchasers thereof
its good and sufficient deed or deeds conveying the property so sold, but without any covenant or
warranty, express or implied. The recitals in such deed or any matters of facts shall be
conclusive proof of the truthfulness thereof. Any person, including, without limitation, Trustor,
Trustee or Beneficiary, may purchase at such sale.
(b)After deducting all reasonable costs, fees and expenses of Trustee,
including costs of evidence of title in connection with such sale, Trustee shall apply the proceeds
of sale to payment of: (i) the unpaid principal amount of the Note; (ii) the unpaid interest
amount of the Note; (iii) all other amounts owed to Beneficiary under the Loan Documents; (iv)
all other sums then secured hereby; and (v) the remainder, if any, to Trustor.
(c)Trustee may postpone sale of all or any portion of the Property by public
announcement at such time and place of sale, and from time to time thereafter, and without
further notice make such sale at the time fixed by the last postponement, or may, in its discretion,
give a new Notice of Default and Election to Sell.
Section 7.5 Receiver.
If an Event of Default shall have occurred and be continuing, Beneficiary, as a matter of
right and without further notice to Trustor or anyone claiming under the Security, and without
regard to the then value of the Security or the interest of Trustor therein, shall have the right to
apply to any court having jurisdiction to appoint a receiver or receivers of the Security (or a part
thereof), and Trustor hereby irrevocably consents to such appointment and waives further notice
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of any application therefor. Any such receiver or receivers shall have all the usual powers and
duties of receivers in like or similar cases, and all the powers and duties of Beneficiary in case of
entry as provided herein, and shall continue as such and exercise all such powers until the date of
confirmation of sale of the Security, unless such receivership is sooner terminated.
Section 7.6 Remedies Cumulative.
No right, power or remedy conferred upon or reserved to the Beneficiary by this Deed of
Trust is intended to be exclusive of any other right, power or remedy, but each and every such
right, power and remedy shall be cumulative and concurrent and shall be in addition to any other
right, power and remedy given hereunder or now or hereafter existing at law or in equity.
Section 7.7 No Waiver.
(a)No delay or omission of the Beneficiary to exercise any right, power or
remedy accruing upon any Event of Default shall exhaust or impair any such right, power or
remedy, or shall be construed to be a waiver of any such Event of Default or acquiescence
therein; and every right, power and remedy given by this Deed of Trust to the Beneficiary may
be exercised from time to time and as often as may be deemed expeditious by the Beneficiary.
Beneficiary 's expressed or implied consent to a breach by Trustor, or a waiver of any obligation
of Trustor hereunder shall not be deemed or construed to be a consent to any subsequent breach,
or further waiver, of such obligation or of any other obligations of the Trustor hereunder. Failure
on the part of the Beneficiary to complain of any act or failure to act or to declare an Event of
Default, irrespective of how long such failure continues, shall not constitute a waiver by the
Beneficiary of its right hereunder or impair any rights, power or remedies consequent on any
Event of Default by the Trustor.
(b)If the Beneficiary (i) grants forbearance or an extension of time for the
payment of any sums secured hereby, (ii) takes other or additional security or the payment of any
sums secured hereby, (iii) waives or does not exercise any right granted in the Loan Documents,
(iv) releases any part of the Security from the lien of this Deed of Trust, or otherwise changes
any of the terms, covenants, conditions or agreements in the Loan Documents, (v) consents to the
granting of any easement or other right affecting the Security, or (vi) makes or consents to any
agreement subordinating the lien hereof, any such act or omission shall not release, discharge,
modify, change or affect the original liability under this Deed of Trust, or any other obligation of
the Trustor or any subsequent purchaser of the Security or any part thereof, or any maker, co-
signer, endorser, surety or guarantor (unless expressly released); nor shall any such act or
omission preclude the Beneficiary from exercising any right, power or privilege herein granted
or intended to be granted in any Event of Default then made or of any subsequent Event of
Default, nor, except as otherwise expressly provided in an instrument or instruments executed by
the Beneficiary shall the lien of this Deed of Trust be altered thereby.
Section 7.8 Suits to Protect the Security.
The Beneficiary shall have power to (a) institute and maintain such suits and proceedings
as it may deem expedient to prevent any impairment of the Security and the rights of the
Beneficiary as may be unlawful or any violation of this Deed of Trust, (b) preserve or protect its
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interest (as described in this Deed of Trust) in the Security, and (c) restrain the enforcement of or
compliance with any legislation or other governmental enactment, rule or order that may be
unconstitutional or otherwise invalid, if the enforcement for compliance with such enactment,
rule or order would impair the Security thereunder or be prejudicial to the interest of the
Beneficiary.
Section 7.9 Beneficiary May File Proofs of Claim.
In the case of any receivership, insolvency, bankruptcy, reorganization, arrangement,
adjustment, composition or other proceedings affecting the Trustor, its creditors or its property,
the Beneficiary, to the extent permitted by law, shall be entitled to file such proofs of claim and
other documents as may be necessary or advisable in order to have the claims of the Beneficiary
allowed in such proceedings and for any additional amount which may become due and payable
by the Trustor hereunder after such date.
Section 7.10 Waiver.
The Trustor waives presentment, demand for payment, notice of dishonor, notice of
protest and nonpayment, protest, notice of interest on interest and late charges, and diligence in
taking any action to collect any sums owing under the Note or in proceedings against the
Security, in connection with the delivery, acceptance, performance, default, endorsement or
guaranty of this Deed of Trust.
Section 7.11 Compensation, Exculpation, Indemnification.
Trustor agrees to pay fees in the maximum amounts legally permitted, or
reasonable fees as may be charged by Beneficiary and Trustee when the law provides no
maximum limit, for any services that Beneficiary or Trustee may render in connection with this
Deed of Trust, including Beneficiary’s providing a statement of the secured obligations or
Trustee’s rendering of services in connection with a release or reconveyance (full or partial).
Trustor shall also pay or reimburse all of Beneficiary’s and Trustee’s costs and expenses which
may be incurred in rendering any such services. Trustor further agrees to pay or reimburse
Beneficiary for all costs, expenses, and other advances which may be incurred or made by
Beneficiary or Trustee in any efforts to enforce any terms of this Deed of Trust, including the
exercise of any rights or remedies afforded to Beneficiary or Trustee or both of them under the
remedies section below, whether any lawsuit is filed or not, or in defending any action or
proceeding arising under or relating to this Deed of Trust, including reasonable attorneys’ fees
and other legal costs (which shall include reimbursement for the allocated costs of in-house
counsel used by Beneficiary and/or Trustee to the extent not prohibited by law), costs of any
Trustee’s Sale (as described below), any judicial foreclosure of this Deed of Trust, and any cost
of evidence of title. If Beneficiary chooses to dispose of Property through more than one
Trustee’s Sale or judicial foreclosure, Trustor shall pay all costs, expenses, or other advances that
may be incurred or made by Trustee or Beneficiary in each of such Trustee’s Sales or judicial
foreclosure actions.
Beneficiary shall not be directly or indirectly liable to Trustor or any other person
as a consequence of any of the following:
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a. Beneficiary’s exercise of or failure to exercise any rights, remedies
or powers granted to Beneficiary in this Deed of Trust;
b. Beneficiary’s failure or refusal to perform or discharge any
obligation or liability of Trustor under any agreement related to the Property or under this Deed
of Trust;
c. Any waste committed by lessees of the Property or any other
parties, or any dangerous or defective condition of the Property; or
d. Any loss sustained by Trustor or any third party resulting from
Beneficiary’s failure to lease the Property, or from any other act or omission of Beneficiary in
operating or managing the Property, after an Event of Default, unless the loss is caused solely by
the gross negligence or willful misconduct of Beneficiary.
Trustor hereby expressly waives and releases all liability of the types described above,
and agrees that no such liability shall be asserted against or imposed upon Beneficiary.
Trustor agrees to indemnify, defend, and hold Trustee and Beneficiary harmless,
for, from, and against, and reimburse them for, all losses, damages, liabilities, claims, causes of
action, judgments, penalties, court costs, reasonable attorneys’ fees and other legal expenses and
expenses of professional consultants and experts, cost of evidence of title, cost of evidence of
value, and other costs and expenses, including the settlement of any such matter, excepting those
arising out of, or resulting, solely from Beneficiary’s or Trustee’s, as the case may be, gross
negligence or willful misconduct, which either may suffer or incur:
i.In performing any act required or permitted by this Deed of Trust
or any of the other Loan Documents or by law;
ii. Because of any failure of Trustor to perform any of Trustor’s
obligations; or
iii. Because of any alleged obligation of or undertaking by Beneficiary
to perform or discharge any of the representations, warranties, conditions, covenants, or other
obligations in any document relating to the Property other than the Loan Documents.
This agreement by Trustor to indemnify Trustee and Beneficiary shall survive payoff,
termination, or the release and cancellation of any or all of the secured obligations, and the full
or partial release and/or reconveyance of this Deed of Trust.
Trustor shall pay all obligations to pay money arising under this Section immediately
upon written demand by Trustee or Beneficiary. Each such obligation shall be added to, and
considered to be part of, the principal of the Note, and shall bear interest from the date the
obligation arises at the Default Rate (as such term may be defined in the Note), or if no Default
Rate is specified, at ten percent (10%) or such lower rate as may be permitted by law; provided
that if more than one rate of interest is in effect, the highest permissible rate shall be used.
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ARTICLE 8
MISCELLANEOUS
Section 8.1 Amendments.
This instrument cannot be waived, changed, discharged or terminated orally, but only by
an instrument in writing signed by Beneficiary and Trustor.
Section 8.2 Reconveyance by Trustee.
Prepayment or payment of the City Loan shall not relieve Trustor of its obligations under
the Regulatory Agreement. Trustor’s performance under the Regulatory Agreement is secured
by this Deed of Trust. Even if all amounts payable under the City Land Note are paid in full,
Beneficiary shall only reconvey this Deed of Trust upon satisfaction of all of Trustor’s
obligations under the Regulatory Agreement. Upon written request of Beneficiary stating that (i)
all sums secured hereby have been paid or forgiven, and (ii) that all obligations of the Trustor
under the Loan Documents have been satisfied, and upon surrender of this Deed of Trust to
Trustee for cancellation and retention, and upon payment by Trustor of Trustee's reasonable fees,
Trustee shall reconvey the Security to Trustor, or to the person or persons legally entitled thereto.
Section 8.3 Notices.
If at any time after the execution of this Deed of Trust it shall become necessary or
convenient for one of the parties hereto to serve any notice, demand or communication upon the
other party, such notice, demand or communication shall be in writing and shall be served
personally or by depositing the same in the registered United States mail, return receipt
requested, postage prepaid and (1) if intended for Beneficiary shall be addressed to:
City of Lake Elsinore
130 South Main Street
Lake Elsinore, CA 92530
Attention: City Manager
and (2) if intended for Trustor shall be addressed to:
_______________________________________
c/o C & C Development Co., LLC
14211 Yorba Street, Suite 200
Tustin, CA 92780
Attn: Todd R. Cottle
with a copy to the Trustor's investor limited partner:
____________________________
____________________________
____________________________
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Any notice, demand or communication shall be deemed given, received, made or communicated
on the date personal delivery is effected or, if mailed in the manner herein specified, on the
delivery date or date delivery is refused by the addressee, as shown on the return receipt. Either
party may change its address at any time by giving written notice of such change to Beneficiary
or Trustor as the case may be, in the manner provided herein, at least ten (10) days prior to the
date such change is desired to be effective.
Section 8.4 Successors and Joint Trustors.
Trustor will not cause or permit any change to be made in (a) its name, identity, or
corporate, partnership, limited liability company, or other entity structure, (b) its jurisdiction of
organization (c) its organizational identification number, (d) its place of business or, if more than
one, its chief executive office, (e) its mailing address, or (f) any change in the location of any
Property, unless Trustor shall have notified Beneficiary in writing of such change at least thirty
(30) days prior to the effective date of such change, and shall have first taken all action required
by Beneficiary for the purpose of further perfecting or protecting the lien and security interest of
Beneficiary in the Property. Unless otherwise approved by Beneficiary in writing, all Property
that consists of personal property (other than books and records) will be located on the Land and
all books and records will be located at Trustor’s place of business or chief executive office if
Trustor has more than one place of business. Where an obligation is created herein binding upon
Trustor, the obligation shall also apply to and bind any permitted transferee or successors in
interest. Where the terms of the Deed of Trust have the effect of creating an obligation of the
Trustor and a transferee, such obligation shall be deemed to be a joint and several obligation of
the Trustor and such transferee. Where Trustor is more than one entity or person, all obligations
of Trustor shall be deemed to be a joint and several obligation of each and every entity and
person comprising Trustor.
Section 8.5 Captions.
The captions or headings at the beginning of each Section hereof are for the convenience
of the parties and are not a part of this Deed of Trust.
Section 8.6 Invalidity of Certain Provisions.
Every provision of this Deed of Trust is intended to be severable. In the event any term
or provision hereof is declared to be illegal or invalid for any reason whatsoever by a court or
other body of competent jurisdiction, such illegality or invalidity shall not affect the balance of
the terms and provisions hereof, which terms and provisions shall remain binding and
enforceable. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the
debt, or if the lien is invalid or unenforceable as to any part of the Security, the unsecured or
partially secured portion of the debt, and all payments made on the debt, whether voluntary or
under foreclosure or other enforcement action or procedure, shall be considered to have been
first paid or applied to the full payment of that portion of the debt which is not secured or
partially secured by the lien of this Deed of Trust.
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Section 8.7 Governing Law.
This Deed of Trust shall be governed by and construed in accordance with the laws of the
State of California.
Section 8.8 Gender and Number.
In this Deed of Trust the singular shall include the plural and the masculine shall include
the feminine and neuter and vice versa, if the context so requires.
Section 8.9 Deed of Trust, Mortgage.
Any reference in this Deed of Trust to a mortgage shall also refer to a deed of trust and
any reference to a deed of trust shall also refer to a mortgage.
Section 8.10 Actions.
Trustor agrees to appear in and defend any action or proceeding purporting to affect the
Security.
Section 8.11 Substitution of Trustee.
Beneficiary may from time to time substitute a successor or successors to any Trustee
named herein or acting hereunder to execute this Trust. Upon such appointment, and without
conveyance to the successor trustee, the latter shall be vested with all title, powers, and duties
conferred upon any Trustee herein named or acting hereunder. Each such appointment and
substitution shall be made by written instrument executed by Beneficiary, containing reference to
this Deed of Trust and its place of record, which, when duly recorded in the proper office of the
county or counties in which the Property is situated, shall be conclusive proof of proper
appointment of the successor trustee.
Section 8.12 Statute of Limitations.
The pleading of any statute of limitations as a defense to any and all obligations secured
by this Deed of Trust is hereby waived to the full extent permissible by law.
Section 8.13 Acceptance by Trustee.
Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is
made public record as provided by law. Except as otherwise provided by law the Trustee is not
obligated to notify any party hereto of pending sale under this Deed of Trust or of any action of
proceeding in which Trustor, Beneficiary, or Trustee shall be a party unless brought by Trustee.
Section 8.14 Attorneys’ Fees.
In the event that either party hereto brings any action or files any proceeding in
connection with the enforcement of its respective rights under this Deed of Trust or the City
Land Note, as a consequence of any breach by the other party of its obligations thereunder, the
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prevailing party in such action or proceeding shall be entitled to have its reasonable attorneys’
fees and out-of-pocket expenditures paid by the losing party. The attorneys’ fees so recovered
shall include fees for prosecuting or defending any appeal and shall be awarded for any
supplemental proceedings until the final judgment is satisfied in full. In addition to the foregoing
award of attorneys’ fees, the prevailing party in any lawsuit with respect to the City Land Note or
this Deed of Trust shall also be entitled to its attorneys’ fees incurred in any post-judgment
proceedings to collect or enforce the judgment. In addition to the foregoing, Trustor agrees to
pay or reimburse Beneficiary, upon demand by Beneficiary, for all costs incurred by Beneficiary
in connection with enforcement of this Deed of Trust or the City Land Note, including without
limitation, reasonable attorneys’ fees and costs, if there shall be filed by or against Trustor any
proceedings under any federal or state bankruptcy or insolvency laws, whether Beneficiary is a
creditor in such proceedings or otherwise.
As used herein, the terms “attorneys’ fees” or “attorneys’ fees and costs” means the fees and
expenses of counsel to the parties hereto (including, without limitation, in-house counsel
employed by Beneficiary) which may include printing, duplicating and other expenses, air
freight charges, and fees billed for law clerks, paralegals and others not admitted to the bar but
performing services under the supervision of an attorney. The terms “attorneys’ fees” or
“attorneys’ fees and costs” shall also include, without limitation, all such fees and expenses
incurred with respect to appeals, arbitrations and bankruptcy proceedings, and whether or not
any action or proceeding is brought with respect to the matter for which said fees and expenses
were incurred.
Section 8.15 Waiver of Special or Consequential Damages
Trustor shall in no event be entitled to, and hereby waives, any right to seek consequential or
special damages of any kind or nature from Beneficiary arising out of or in connection with this
Deed of Trust , and in connection with such waiver Trustor is familiar with and hereby waives
the provision of Section 1542 of the California Civil Code which provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE WHICH IF KNOWN BY HIM OR HER MUST HAVE
MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”
Section 8.16 Request For Notice.
Pursuant to Government Code Section 27321.4(b) Trustor hereby requests that a copy of
any notice of default or notice of sale given under this Deed of Trust be mailed to Trustor at the
address for Trustor set forth herein.
Section 8.17 Compliance with Internal Revenue Code Section 42.
Beneficiary acknowledges that Trustor intends to enter into an extended use agreement,
which constitutes the extended low-income housing commitment described in Section
42(h)(6)(B) of the Internal Revenue Code, as amended (the "Code"). As of the date hereof, Code
Section 42(h)(6)(E)(ii) does not permit the eviction or termination of tenancy (other than for
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good cause) of an existing tenant of any low-income unit or any increase in the gross rent with
respect to such unit not otherwise permitted under Code Section 42 for a period of three (3) years
after the date the building is acquired by foreclosure or by instrument in lieu of foreclosure. In
the event the extended use agreement is recorded against the Property, the Beneficiary agrees to
comply with the provisions set forth in Code Section 42(h)(6)(E)(ii).
IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the day and
year first above written.
TRUSTOR:
________________________________, a
California limited partnership
By:______________________, a California
limited liability company, its managing
general partner
By:____________________________
Name: ____________________________
Its:____________________________
By:______________________, a California
limited liability company, its administrative
general partner
By:____________________________
Name: ____________________________
Its:____________________________
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STATE OF CALIFORNIA )
)
COUNTY OF __________________)
On ____________________, before me, ___________________________, Notary
Public, personally appeared ______________________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
______________________________________
Name: ______________________________
Notary Public
A notary public or other officer completing this certificate
verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the
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STATE OF CALIFORNIA )
)
COUNTY OF __________________)
On ____________________, before me, ___________________________, Notary
Public, personally appeared ______________________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
______________________________________
Name: ______________________________
Notary Public
A notary public or other officer completing this certificate
verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the
1603\27\1893314.3
8/18/2016 G-25
EXHIBIT A
Property Legal Description
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE COUNTY OF RIVERSIDE, STATE OF
CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:
THAT PORTION OF THE SOUTHEAST 1/4 OF SECTION 16, TOWNSHIP 6 SOUTH, RANGE 4 WEST, SAN
BERNARDINO BASE AND MERIDIAN, DESCRIBED AS FOLLOWS:
COMMENCING AT THE MOST NORTHERLY CORNER OF LOT 12 IN BLOCK "G" OF RANCHO LA
LAGUNA,AS SHOWN BY MAP ON FILE IN BOOK 4, PAGE 174 OF MAPS, RECORDS OF SAN DIEGO
COUNTY,CALIFORNIA;
THENCE NORTH 74° 45' EAST, 220 FEET;
THENCE NORTH 15° 15 WEST, 110 FEET;
THENCE NORTH 74° 45' EAST, 440 FEET;
THENCE NORTH 15° 15' WEST, 110 FEET TO THE TRUE POINT OF BEGINNING;
THENCE SOUTH 74° 45' WEST, TO A POINT ON THE NORTHEASTERLY PROLONGATION OF THE
NORTHWESTERLY LINE OF LOT 12 IN BLOCK "G" OF RANCHO LA LAGUNA, AS SHOWN BY MAP
ON FILE IN BOOK 4 PAGE 17 OF MAPS, RECORDS OF SAN DIEGO COUNTY,CALIFORNIA;
THENCE NORTHEASTERLY ON SAID NORTHEASTERLY PROLONGATION OF NORTHWESTERLY LINE
OF SAID LOT 12 IN BLOCK "G" TO THE WESTERLY LINE OF MISSION TRAIL HIGHWAY;
THENCE FOLLOWING ALONG THE WESTERLY LINE OF SAID MISSION TRAIL HIGHWAY IN A
SOUTHEASTERLY DIRECTION, TO A POINT WHICH BEARS NORTH 74° 45' EAST FROM THE POINT OF
BEGINNING;
THENCE SOUTH 74° 45' WEST, TO THE TRUE POINT OF BEGINNING.
SAID LAND BEING ALSO DESCRIBED AS ALL OF LOTS 1110, 1111, 1175, 1176, 1177, 1178,
1179, 1238, 1239, 1240, 1241, 1242 AND THE NORTHWESTERLY 1/2 OF LOT 1243, AS SHOWN ON
ASSESSOR'S MAP NO. 48,RECORDS OF RIVERSIDE COUNTY, CALIFORNIA, AND THAT PORTION OF
THE ABANDONED RIGHTS OF WAY OF ATCHISON, TOPEKA AND SANTA FE RAILROAD COMPANY,
ADJACENT THERETO.
APN: 365-030-001