HomeMy WebLinkAboutR21-Economic Development Agency
ECONOMIC DEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
FROM:
Gary Van Osdel
Executive Director
SUBJECT:
2003 DISPOSITION AND
DEVELOPMENT AGREEMENT WITH
STAN ROBBINS FOR EXCHANGE OF
PROPERTY LOCATED AT 450 NORTH
"F" STREET AND PURCHASE OF
AGENCY PROPERTY LOCATED AT 532
NORTH "D" STREET
DATE:
October 10, 2003
ORiGiNAL
..__________u_______________________________~_________-----------_.----------------------.-------------------~------------------------------------------------------------
Svnonsis of Previons Commission/Conncil/Committee Actionls):
In August 2003, the Community Development Commission approved the negotiations for the exchange of APN 0134-
101-09 and 10 located at 450 North F" Street, and the disposition of Agency-owned property, APN 0134-081-10-22 and
23, located at 532 North "D" Street.
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Recommended Motionls):
OPEN/CLOSE PUBLIC HEARING
ICommunitv Develonment Commission)
MOTION A: A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF
SAN BERNARDINO (I) APPROVING THE EXCHANGE PURCHASE OF CERTAIN REAL
PROPERTY BY THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
("AGENCY") FROM STAN ROBBINS, AN INDIVIDUAL, (2) APPROVING THE EXCHANGE
SALE OF CERTAIN REAL PROPERTY BY THE AGENCY TO STAN ROBBINS, AND (3)
AUTHORIZING THE AGENCY EXECUTIVE DIRECTOR TO EXECUTE THE 2003
DISPOSITION AND DEVELOPMENT AGREEMENT BETWEEN THE AGENCY AND STAN
ROBBINS
lMavor and Commou Council)
MOTIONB: A RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN
BERNARDINO (I) APPROVING THE EXCHANGE PURCHASE OF CERTAIN REAL
PROPERTY BY THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
("AGENCY") FROM STAN ROBBINS, AN INDIVIDUAL AND (2) APPROVING THE
EXCHANGE SALE OF CERTAIN REAL PROPERTY BY THE AGENCY TO STAN ROBBINS
_________________________________________________________..n_____________________________________n____________________.____________________________________________
Contact Person(s):
Gary Van Osdel
Central City North
Phone:
(909) 663-1044
Project Area(s)
Ward(s):
1st
Supporting Data Attached: I!'l Staff Report I!'l Resolution(s) I!'l Agreement(s)/Contract(s) 0 Map(s) 0 Letters
See Fiscal
FUNDING REQUIREMENTS Amount: $ Impact Source:
Budget Authority:
SIGNATURE:
tr..... ) Gary Van, ' Executive Director
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Commission/Council Notes:
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P:\Agendas\Comrn Dev Commission\CDC 2003\03-10-20 532 N D 51 CDC SR,doc
COMMISSION MEETING AGENDA
Meeting Date: 10/2012003
Agenda Item Number: R..:J.-/
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
2003 Disposition and Development Al!reement with Stan Robbins
for Exchanl!e of Property Located at 450 North "F" Street and
Purchase of Al!encv Property Located at 532 North "D" Street
BACKGROUND/CURRENT ISSUE:
In July of 1990, the Agency purchased the property located at 532 North "D" Street (APN 0134-081-
10, 22 and 23) consisting of 46,500 square feet of land and a 4,680 square foot building ("Agency
Property"). The Mexican Consulate leased the Agency Property from 1991 to 1999. Since the
Mexican Consulate moved, there have been several tenants in and out of the Agency Property and
several non-performing offers to purchase. Presently the Agency Property is vacant.
The Agency is making every effort to improve the downtown area and attract new development to the
site next to the Cinema Star and California Theater. It is Staffs opinion that the vacant, undeveloped
commercial 23,274 square foot parcel of land (APN 0134-101-09 and 10) located at 450 North "F"
Street ("Robbins Site") would be an asset and enhance the Agency's goal of improving downtown.
Furthermore, the Robbins Site could be used to supplement the parking for both theaters. In July
2003, Agency Staff approached the property owner of the Robbins Site, Stan Robbins ("Robbins"), to
see if he would be interested in selling the Robbins Site to the Agency. Robbins indicated that he
would like to do an exchange of properties. Robbins' offer consisted of conveying to the Agency the
Robbins Site in exchange for the purchase of the Agency Property.
Following the Community Development Commission's authorization to negotiate with Robbins for
the exchange of the Robbins Site and the disposition of the Agency Property, Staff has had both
properties appraised and a phase one environmental analysis completed for the Robbins Site. In
August 2003, the Robbins Site was appraised at $150,000 and in March 2003, the Agency Property
was appraised at $480,000.
Consequently, the attached 2003 Disposition and Development Agreement by and between Agency
and Stan Robbins, an Individual ("DDA") has been prepared for Agency and Commission
consideration. The DDA provides for the Agency to simultaneously acquire the Robbins Site for the
value of $150,000 and transfer and exchange the Agency Property to Robbins for the exchange value
of $480,000. The DDA further provides that the exchange value of the Robbins Property ($150,000)
will be applied against the exchange value of the Agency Property ($480,000) and for the payment by
Robbins to the Agency for the exchange and transfer of the Agency Property to Robbins in the
amount of $330,000. Robbins has paid to the Agency a $5,000 deposit which will be applied towards
the Agency Property remaining balance of $330,000. The Agency will secure the remaining purchase
price ("debt") by a holding a first trust deed and a note in the amount of $325,000 on the Agency
Property. The promissory note will bear an interest rate of 6% per annum, based on a 25 year
amortization schedule with the balance of principal and interest due five (5) years from the close of
escrow ("maturity date"). Therefore, Robbins will make a monthly payment to the Agency in the
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P:\Agendas\Comm Dev Commission\CDC 2003\03-10-20 532 N D 51 CDC SR.doc
COMMISSION MEETING AGENDA
Meeting Date: 10/2012003
Agenda Item Number: /?..J-I
Economic Development Agency Staff Report
Stan Robbins DDA
Page 2
amount of $2,093.98 until the maturity date, at which time the remaining principle and interest
payment will be due in full to the Agency ("balloon payment").
Robbins intends to occupy and maintain the Agency Property and to possibly lease offices to various
businesses within the Community. With regard to the Robbins Site, Agency Staff intends to continue
to leave the Robbins Site vacant until such time as the Agency has determined the final reuse of the
Robbins Site, which could include using it for supplemental parking to accommodate both theaters.
In conclusion, Agency Staff has prepared the required 33433 Summary Report (which is on file with
the Agency Secretary) concluding that the transfer and exchange of the Agency Property and the
concurrent purchase of the Robbins Site will assist in the elimination of blight, encourage
reinvestment and redevelopment of the Central City North Project Area; will place the Agency
Property back on the tax roles; eliminate maintenance costs for the present Agency Property; and
create additional employment opportunities for community residents. The Summary Report further
outlines the costs of the proposed DDA, the value of the interest being conveyed, determined at the
highest and best uses permitted under the Redevelopment Plan, and how the transaction will assist in
the elimination of blight within the project area.
ENVIRONMENTAL IMPACT:
None.
FISCAL IMPACT:
Based on the provisions ofthe DDA, the Agency will receive the Robbins Site valued at $150,000, a
$5,000 cash deposit and a $325,000 note at the interest rate of 6% for the sale of the Agency
Property. This is equal or greater than the fair market value of the Agency Property of $480,000.
RECOMMENDATION:
That the Community Development Commission and Mayor and Common Council adopt the attached
Resolutions.
__________~___________.________________________________d_____________________________________________________------------------------------------
P:\Agendas\Comm Dev CommissioR\COC 2003\03-10-20 532 N D St COC SR.doc
COMMISSION MEETING AGENDA
Meeting Date: 10/20/2003
Agenda Item Number: /f..J.. J
ECONOMIC DEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARD1tfOf/V...."'..i?/T.,
C:J u er f!P!<
INTER-OFFICE MEMORANDU~ OCT 22
P3 :08
FROM:
Michelle Taylor, Senior Secretary, City Clerk's Office
-nJfM:argaret Parker, Secretary
TO:
SUBJECT:
Executed Document
DATE:
October 21, 2003
Enclosed is the fully executed 2003 Disposition and Development Agreement by and between
Redevelopment Agency of the City of San Bernardino and Stan Robbins, An Individual.
Please let me know if you have any questions.
Thank you,
Margaret
Enclosure
cc: Barbara Lindseth (with Original Executed Agreement)
Barbara Sharp (with Copy of Agreement)
Ann Harris (with Copy of Agreement)
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RESOLUTION NO.
A RESOLUTION OF THE COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BER."IARDINO (1) APPROVING
THE EXCHANGE PURCHASE OF CERTAIN REAL PROPERTY BY
THE REDEVELOPMENT AGENCY OF THE CITY OF SAN
BERNARDINO ("AGENCY") FROM STAN ROBBINS, AN
INDIVIDUAL, (2) APPROVING THE EXCHANGE SALE OF CERTAIN
REAL PROPERTY BY THE AGENCY TO STAN ROBBINS, AND (3)
AUTHORIZING THE AGENCY EXECUTIVE DIRECTOR TO
EXECUTE THE 2003 DISPOSITION AND DEVELOPMENT
AGREEMENT BETWEEN THE AGENCY AND STAN ROBBINS
4
5
6
7
8
WHEREAS, the Community Development Commission of the City of San Bernardino
9
(the "Community Development Commission") is the governing board of the Redevelopment
10
Agency of the City of San Bernardino (the "Agency"); and
II
WHEREAS, the Agency desires to acquire certain real property (the "Robbins
12
Property") owned by Stan Robbins, and his assigns ("Robbins") in exchange for certain real
property (the "Agency Property") owned by the Agency, plus cash payable to the Agency in an
amount equal to the difference between the appraisal value of the Robbins Property and the
15
Agency Property as set forth in that certain agreement by and between Robbins and the
16
Agency entitled "Disposition and Development Agreement" (the "DDA"); and
17
WHEREAS, the Agency Property is located at 532 North D Street within the Central
18
City North Redevelopment Project Area and is improved with an approximately 4680 square
19
foot office commercial building; and
20
WHEREAS, an appraisal of the Agency Property was performed in March 2003 by
Inland Empire Consultant, Inc. (the "Appraiser"); and
21
22
WHEREAS, according to the report dated March 19, 2003 (the "Agency Appraisal
23
Report"), prepared by the Appraiser, the fair market value of the Agency Property is
24
$480,000,00; and
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WHEREAS, the Robbins Property is located at 450 North F Street within the Central
City North Redevelopment Project Area and is vacant land; and
3
WHEREAS, an appraisal of the Robbins Property was performed in August 2003 by
4
the Appraiser; and
5
WHEREAS, according to the report dated August 6, 2003 (the "Robbins Appraisal
6
Report"), prepared by the Appraiser, the fair market value of the Robbins Property is
7
$150,000.00; and
8
WHEREAS, the Agency intends to enter into the DDA pursuant to which the Agency
9
wilI, simultaneously with its acquisition and exchange of the Robbins Property from Robbins
10
for the value of $150,000.00, transfer and exchange the Agency Property to Robbins for the
11
exchange value of $480,000.00; and
12
WHEREAS, the DDA further provides that the exchange value of the Robbins Property
will be applied against the exchange value of the Agency Property and for the payment by
Robbins to the Agency in cash of the balance due for the exchange and transfer of the Agency
15
Property to Robbins in the amount of $330,000 after such exchange value credit is recognized;
16
and
17
WHEREAS, an evaluation of the potential environmental effects of the simultaneous
18
exchange of the Agency Property and the Robbins Property is exempt from the California
Environmental Quality Act ("CEQA") and the CEQA Guidelines developed thereunder (the
19
20
"CEQA Guidelines"); and
21
WHEREAS, pursuant to Section 1530 I of the CEQA Guidelines the exchange of the
22
Robbins Property and the Agency Property, respectively under the DDA, is a Class I
23
categorical exemption under the CEQA Guidelines as there will be no expansion of use of the
24
Agency Property by Robbins because the office building is already in existence and no further
development is needed or contemplated upon acquisition, and the Agency plans to hold the
2
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Robbins Property upon acquisition as an unimproved property asset of the Agency until such a
time as the Agency has determined the final re-use of the Agency Property; and
3
WHEREAS, the exchange of the Robbins Property and the Agency Property under the
4
DDA will not expand the existing use of either property and no requirement of an additional
5
environmental review or further environmental review of the exchange of the real property is
6
necessary; and
7
WHEREAS, the exchange and acquisition of the Agency Property by Robbins and the
8
exchange and acquisition of the Robbins Property by the Agency is consistent with the Central
9
City North Redevelopment Plan; and
]0
WHEREAS, it is appropriate for the Community Development Commission to approve
11
the acquisition of the Robbins Property from Robbins and the disposition of the Agency
]2
Property to Robbins as set forth in the DDA and this Resolution.
IS
NOW, THEREFORE, THE COMMU1\TIY DEVELOPMENT COMMISSION OF THE
CITY OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE Al\TD ORDER, AS
FOLLOWS:
16
Section I.
This Resolution is adopted in furtherance of the provisions of Health &
17 Safety Code Section 33433 ("Summary Report"). Said Summary Report is on file with the
18 Agency Secretary.
19
Section 2.
The Community Development Commission has conducted a full and fai
public hearing regarding the disposition and exchange of the Agency Property for the Robbin
Property pursuant to the terms and conditions of the DDA. The total value and consideratio
realized by the Agency under the DDA for the exchange and disposition of the Agency Propert
and the Robbins Property is not less than the fair market value of the Agency Property at it
highest and best use in accordance with the Redevelopment Plan. The Community Developmen
Commission hereby approves the simultaneous exchange of the Agency Property and th
3
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Robbins Property on the terms set forth in the DDA. The Community Development Commissio
7
Section 3.
The Community Development Commission finds that the exchange of th
hereby approves the DDA in the form as presented at the meeting at which this Resolution i
3
adopted. The Executive Director of the Agency is hereby authorized and directed to execute th
4
DDA on behalf of the Agency, together with such technical and non-material conformin
5
changes as may be recommended by Agency Counsel. The DDA as hereby approved shall hav
6
no force or effect until it has been executed by the Executive Director of the Agency.
8 real property as contemplated under the DDA will not expand the existing use of either propert
9 and no requirement of an additional environmental review or further environmental review of th
10 exchange of the real property is necessary as provided for in CEQA Guidelines Section 15301.
II The Executive Director of the Agency hereby authorized and directed to prepare and file wit
12 County Clerk, the appropriate form of a Notice of Exemption in connection with the adoption 0
r13 this Resolution.
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The Resolution shall become effective immediately upon its adoption.
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A RESOLUTION OF THE COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BERNARDINO (1) APPROVING
THE EXCHANGE PURCHASE OF CERTAIN REAL PROPERTY BY
THE REDEVELOPMENT AGENCY OF THE CITY OF SAN
BERNARDINO ("AGENCY") FROM STAN ROBBINS, AN INDIVIDUAL,
(2) APPROVING THE EXCHANGE SALE OF CERTAIN REAL
PROPERTY BY THE AGENCY TO STAN ROBBINS, AND (3)
AUTHORIZING THE AGENCY EXECUTIVE DIRECTOR TO EXECUTE
THE 2003 DISPOSITION AND DEVELOPMENT AGREEMENT
BETWEEN THE AGENCY AND STAN ROBBINS
4
5
6
7
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the
8 Community Development Commission of the City of San Bernardino at a
meeting
9 thereof, held on the
day of
,2003, by the following vote to wit:
10 Commission Members:
Nays
Abstain
Absent
Ayes
I]
ESTRADA
LONGVILLE
MCGINNIS
12
C1.3
DERRY
14
"..-" 25
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]5
SUAREZ
ANDERSON
MC CAMMACK
16
17
18
Secretary
19
The foregoing resolution is hereby approved this
day of
,2003.
20
21
Judith Valles, Chairperson
Community Development Commission
of the City of San Bernardino
22
23
I Content:
24
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RESOLUTION NO.
A RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE
CITY OF SAN BERNARDINO (I) APPROVING THE EXCHANGE
PURCHASE OF CERTAIN REAL PROPERTY BY THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BE~"'ARDINO
("AGENCY") FROM STAN ROBBINS, AN INDIVIDUAL AND (2)
APPROVING THE EXCHANGE SALE OF CERTAIN REAL PROPERTY
BY THE AGENCY TO STAN ROBBINS
4
5
6
7
WHEREAS, the City of San Bernardino, California (the "City") is a municipal
8
corporation and charter city, duly organized and existing pursuant to the provisions of the
9
constitution of the State of California; and
10
WHEREAS, the Redevelopment Agency of the City of San Bernardino (the "Agency")
II
desires to acquire certain real property (the "Robbins Property") owned by Stan Robbins, and
12
his assigns ("Robbins") in exchange for certain real property (the "Agency Property") owned
by the Agency, plus cash payable to the Agency in an amount equal to the difference between
the appraisal value of the Robbins Property and the Agency Property as set forth in that certain
15
agreement by and between Robbins and the Agency entitled "Disposition and Development
16
Agreement" (the "DDA"); and
17
WHEREAS, the Agency Property is located at 532 North D Street within the Central
18
City North Redevelopment Project Area and is improved with an approximately 4680 square
19
foot office commercial building; and
20
WHEREAS, an appraisal of the Agency Property was performed in March 2003 by
21
Inland Empire Consultant, Inc. (the "Appraiser"); and
22
WHEREAS, according to the report dated March 19, 2003 (the "Agency Appraisal
23
Report"), prepared by the Appraiser, the fair market value of the Agency Property is
24
$480,000.00; and
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WHEREAS, the Robbins Property is located at 450 North F Street within the Central
City North Redevelopment Project Area and is vacant land; and
3
WHEREAS, an appraisal of the Robbins Property was performed in August 2003 by
4
the Appraiser; and
5
WHEREAS, according to the report dated August 6, 2003 (the "Robbins Appraisal
6
Report"), prepared by the Appraiser, the fair market value of the Robbins Property is
7
$150,000.00; and
8
WHEREAS, the Agency intends to enter into the DDA pursuant to which the Agency
9
will, simultaneously with its acquisition and exchange of the Robbins Property from Robbins
10
for the value of $150,000.00, transfer and exchange the Agency Property to Robbins for the
11
exchange value of $480,000.00; and
12
WHEREAS, the DDA further provides that the exchange value of the Robbins Property
will be applied against the exchange value of the Agency Property and for the payment by
Robbins to the Agency in cash of the balance due for the exchange and transfer of the Agency
15
Property by Robbins in the amount of $330,000 after such exchange value credit is recognized;
16
and
17
WHEREAS, an evaluation of the potential environmental effects of the simultaneous
18
exchange of the Agency Property and the Robbins Property is exempt from the California
19
Environmental Quality Act ("CEQA") and the CEQA Guidelines developed thereunder (the
20
"CEQA Guidelines"); and
21
WHEREAS, pursuant to Section 15301 of the CEQA Guidelines the exchange of the
22
Robbins Property and the Agency Property, respectively under the DDA, is a Class I
23
categorized exemption under the CEQA Guidelines as there will be no expansion of use of the
24
Agency Property by Robbins because the office building is already in existence and no further
2
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development is needed or contemplated upon acquisition, and the Agency plans to hold the
Robbins Property upon acquisition as an unimproved property asset of the Agency; and
3
WHEREAS, the exchange of the Robbins Property and the Agency Property under the
(' ,5 Property at its highest and best use in accordance with the Redevelopment Plan. Subject to th
'--
4
DDA will not expand the existing use of either property and no requirement of an additional
5
environmental review or further environmental review of the exchange of the real property is
6
necessary; and
7
WHEREAS, the exchange and acquisition of the Agency Property by Robbins and the
8
exchange and acquisition of the Robbins Property by the Agency is consistent with the Central
9
City North Redevelopment Plan; and
10
WHEREAS, it is appropriate for the Mayor and Common Council to approve the
II
acquisition of the Robbins Property from Robbins and the disposition of the Agency Property
12
to Robbins as set forth in the DDA and this Resolution.
15
NOW, THEREFORE, IT IS HEREBY RESOLVED, DETERMINED AND
ORDERED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN
BERNARDINO, AS FOLLOWS:
16
Section I.
This Resolution is adopted in furtherance of the provisions of Health and
17 Safety Code Section 33433 ("Summary Report"). Said Summary Report is on file with the
18 Agency Secretary.
19
The Mayor and Common Council has conducted a full and fair publi
Section 2.
20 hearing regarding the disposition and exchange of the Agency Property for the Robbins Propert
21 pursuant to the terms and conditions of the DDA. The disposition of the Agency Property i
22 consistent with the adopted Implementation Plan of the Agency and the total value an
23 consideration realized by the Agency under the DDA for the exchange and disposition of th
24 Agency Property and the Robbins Property is not less than the fair market value of the Agenc
3
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approval of the DDA by the Community Development Commission of the City of Sa
Bernardino, the Mayor and Common Council, hereby approve the simultaneous exchange of th
Agency Property and the Robbins Property on the terms set forth in the DDA.
Section 3.
The Mayor and Common Council find that the exchange of the rea
property and the DDA will not expand the existing use of either property and no requirement 0
an additional environmental review or further environmental review of the exchange of the rea
property is necessary as provided for in CEQA Guidelines Section 1530 I.
Section 4.
This Resolution shall take effect upon its adoption and execution in the
manner as required by the City Charter.
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A RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE
CITY OF SAN BERNARDINO (1) APPROVING THE EXCHANGE
PURCHASE OF CERTAIN REAL PROPERTY BY THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
("AGENCY") FROM STAN ROBBINS, AN INDIVIDUAL AND (2)
APPROVING THE EXCHANGE SALE OF CERTAIN REAL PROPERTY
BY THE AGENCY TO STAN ROBBINS
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2
4
5
6
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and
7
Common Council of the City of San Bernardino at a
meeting thereof, held
8 on the day of
9 Council Members: Ayes
ESTRADA
10
LONGVILLE
II
MCGINNIS
12
DERRY
C3 SUAREZ
14 ANDERSON
15 MC CAMMACK
16
17
,2003, by the following vote to wit:
Nays
Abstain
Absent
Rachel G. Clark, City Clerk
18
The foregoing resolution is hereby approved this
day of
,2003.
19
20
21
Judith Valles, Mayor
of the City of San Bernardino
22
Approved as to form and legal content:
23
24 By:
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2003
DISPOSITION AND DEVELOPMENT AGREEMENT
BY AND BETWEEN
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
AND
STAN ROBBINS, AN INDIVIDUAL
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2003
DISPOSITION AND DEVELOPMENT
AGREEMENT
This 2003 DISPOSITION AND DEVELOPMENT AGREEMENT (this "Agreement") is
entered into as of , 2003, by and between the REDEVELOPMENT
AGENCY OF THE CITY OF SAN BERNARDINO, a public body corporate and politic (the
"Agency") and STAN ROBBINS, an individual ("Robbins"). The Agency and Robbins hereby
agree as follows:
RECITALS
A. Robbins is the owner of that certain real property commonly known as 450 North "F"
Street, San Bernardino, California and more particularly described in the legal description
attached as Exhibit "A" (the "Exchange Property"). The Exchange Property is located in the
Central City North Redevelopment Project area (the "Project Area").
B. Agency is the owner of that certain real property commonly known as 532 North "0"
Street, San Bernardino, California and more particularly described in the legal description
attached as Exhibit "B" (the "Agency Property"). The Agency Property is located in the Project
Area.
c
C. The Exchange Property and the Agency Property may sometimes be collectively referred
to as the "Property" in this Agreement.
ARTICLE I
Section 1.01. Purpose of Agreement. The purpose of this Agreement is to implement
the Redevelopment Plan for the Central City North Project Area (the "Redevelopment Plan") by
providing for the purchase, use and maintenance by Robbins of the Agency Property, improved
by an office building and providing for the purchase, use and maintenance by the Agency of the
Exchange Property, which is vacant land. The purchase, use and maintenance of the Property
pursuant to this Agreement is in the vital and best interests of the City of San Bernardino (the
"City") and the health, safety and welfare of its residents, and is in accord with the public
purposes and provisions of applicable state and local laws. The Agency has determined that the
purchase, use and maintenance of the Property contemplated by this Agreement are consistent
with the Redevelopment Plan for the Project Area.
Section 1.02. The Agencv Propertv. The Agency Property consists of an approximately
4680 square foot office building situated one acre of land, more or less. Robbins intends to
occupy and maintain the building and possibly lease offices to various businesses within the
community.
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",.... Section 1.03. The Exchange Property. The Exchange Property is vacant land consisting
\""... of approximately .53 acre. The Agency intends to hold the property for further use consistent
with the Redevelopment Plan.
Section 1.04. Benefit to Proiect Area. The Agency has determined that the purchase,
use and maintenance of the Agency Property by Robbins and the purchase, use and maintenance
of the Exchange Property by the Agency, in accordance with this Agreement, will materially
assist in the elimination of blight and the implementation of the Redevelopment Plan for the
Project Area.
Section 1.05. Defined Terms.
"Azencv Guitclaim Deed" means and refers to the deed substantially in the form of the
attached Exhibit "c" to this Agreement together with such additional provisions, limitations,
covenants and restrictions applicable to any portion ofthe Agency Property that may hereafter be
required by either the Agency, the City, or any federal or State environmental regulatory agency.
"Citv" means the City of San Bernardino.
"Close or Escrow" means and refers to the date on which the conditions set forth in this
Agreement for the transfer of the Property have been satisfied, and the appropriate forms of the
Agency Quitclaim Deed and the Robbins Quitclaim Deed are recorded by the Escrow Holder but
shall in no event exceed sixty (60) day from the Opening of Escrow (as defined below).
c
"Escrow Azent" means and refers to Lawyers Escrow and Title, Carolyn Krupt.
"Person" means and refers to any individual, corporation, partnership, limited liability
company, trust, governmental instrumentality or agency or other entity.
"Robbins Guitclaim Deed" means and refers to the deed substantially in the form of the
attached Exhibit "0" together with such additional provisions, limitations, covenants and
restrictions applicable to any portion of the Exchange Property that may hereafter be required by
either the Agency, the City, or any federal or State environmental regulatory agency.
Section 1.06. Parties to the Agreement.
(a) The parties to this Agreement are the Agency and Robbins. The City is not a
party to this Agreement.
(b) Robbins is an individual. The principal office of Robbins for purposes of this
Agreement is
(c) The Agency is a public body, corporate and politic, exercising governmental
functions and power, and organized and existing under the Community Redevelopment Law of
,... the State of California, Health and Safety Code Section 33000, et seq. The principal office of the
,
'I...-
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Agency for purposes of this Agreement is 201 North E Street, Suite 301, San Bernardino,
California, 9240 I, Attention: Executive Director.
Section 1.07. Change in Ownership Management and Control of Robbins - Assignment
and Transfer.
(a) 'Transfer" as used in this Section 1.07, means:
(I) Any total or partial sale, assignment or conveyance, or any trust or power,
or any transfer in any other mode or form by Robbins of more than 49% interest (or series of
such sales, assignments and the like which in the aggregate exceed a disposition of more than a
49% interest) with respect to its interest in this Agreement, the Agency Property, the Exchange
Property or any part thereof or any interest therein or of the improvements constructed thereon,
or any contract or agreement to do any of the same; or
(2) Any total or partial sale, assignment, conveyance, or transfer in any other
mode or form, or with respect to any ownership interest in Robbins (or series of such sales,
assignments and the like which in the aggregate exceed a disposition of more than (49%)
interest; or
(3) Any merger, consolidation, sale or lease of all or substantially all of the
assets of Robbins in the Agreement, the Agency Property, the Exchange Property (prior to the
Close of Escrow) or any part thereof or any interest therein or the improvements constructed
thereon (or series of such sales, assignments and the like which in the aggregate exceeded a
disposition of more than a 49%) interest); or
(4) The leasing of part or all of the Property, except for the leasing of office
space in the normal course of business on the Agency Property.
Section 1.08. List of Attachments to Agreement. Each of the following items or
documents are hereby deemed to be approved by the parties as of the date of approval of this
Agreement by the governing board of the Agency and each such item or document is
incorporated into the text of this Agreement by this reference:
Exhibit "A" Legal description of the Exchange Property
Exhibit "B" Legal description of the Agency Property
Exhibit "c" Form of Agency Quitclaim Deed
Exhibit "D" Form of Robbins Quitclaim Deed
Exhibit "E" Form of Promissory Note
Exhibit "F" Form of Deed of Trust
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Section 1.09. No Recordation of Agreement Survival. This Agreement shall not be
recorded as an encumbrance against title to any portion of the Property. This Agreement shall
survive the Close of Escrow, but these surviving covenants shall be only personal covenants of
the Agency and Robbins that do not run with the any portion of the Property, except that
covenants that are contained in the Agency Quit Claim Deed, the Robbins Quitclaim Deed or
other documents recorded at the Close of Escrow shall run with the Property as provided in such
Agency Quitclaim Deed, Robbins Quitclaim Deed or other documents.
ARTICLE II
Section 2.01. Acquisition and Disoosition of the Prooertv.
(a) Subject to all of the terms, conditions and provisions of this Agreement, and for
the consideration set forth below, Robbins hereby agrees to convey and transfer to the Agency
and the Agency hereby agrees to acquire the following:
all of the right, title and interest of Robbins in and to the Exchange
Property, including all right, title and interest of Robbins in all
improvements thereon and in and to any land lying in the right-of-
way of any existing or proposed highway, street, road, avenue or
alley abutting or adjoining the Exchange Property.
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(b) Subject to all of the terms, conditions and provisions of this Agreement, and for
the consideration set forth below, the Agency hereby agrees to convey and transfer to Robbins
and Robbins hereby agrees to acquire the following:
all of the right, title and interest of the Agency in and to the
Agency Property, including all right, title and interest of the
Agency in all improvements thereon and in and to any land lying
in the right-of-way of any existing or proposed highway, street,
road, avenue or alley abutting or adjoining the Agency Property.
Section 2.02. Conditions for Transfer of the Propertv.
(a) The Agency Property shall be transferred to Robbins and the Exchange Property
shall be transferred to the Agency at the Close of Escrow provided that within the periods of time
set forth in this Agreement (i) neither party has terminated this Agreement; (ii) Robbins and the
Agency have each timely delivered the Due Diligence Approval Certificate for their respective
property as required pursuant to Section 2.11 hereof; (iii) Robbins has accepted the Agency
Quitclaim Deed; (iv) the Agency has accepted the Robbins Quitclaim Deed; and, (v) all other
conditions of the Close of Escrow set forth in this Agreement have been met and the escrow
costs relating to the Close of Escrow have been paid by the appropriate party.
(b) The parties shall deliver jointly approved written escrow instructions (consistent
.r with the terms of this Agreement) to the Escrow Holder for the transfer of the Property as soon
"-- as reasonably possible.
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Section 2.03 Purchase Price.
(a) The purchase price of the Exchange Property is One Hundred Fifty Thousand
Dollars ($150,000.00), (the "Exchange Property Purchase Price").
(b) The purchase price of the Agency Property is Four Hundred Eighty Thousand
Dollars ($480,000.00), (the "Agency Property Purchase Price").
(c) Payment of Agencv Propertv Purchase Price. Upon the Opening of Escrow (as
defined below) Robbins shall deliver to Escrow a non-refundable deposit in the amount of Five
Thousand Dollars ($5,000.00), (the "Deposit"). The Deposit shall be applied to the Agency
Property Purchase Price at the Close of Escrow. The Exchange Property Purchase Price shall be
credited towards the balance of the Agency Property Purchase Price at the Close of Escrow.
Robbins shall execute a promissory note in the form attached as Exhibit "E" for the balance of
the Agency Property Purchase Price (the "Note") due after application of the Deposit and the
Exchange Property Purchase Price. The Note shall bear interest at a rate of six percent (6%) per
annum based on a 25 year amortization with the balance of principal and interest due five years
from the Close of Escrow. The Note shall be secured by a Deed of Trust in the form attached as
Exhibit "F" and recorded in the San Bernardino County Recorder's Office against the Agency
Property (the "Deed of Trust").
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Section 2.04. Opening of Escrow.
(a) The transfer and sale of the Property shall take place through escrow (the
"Escrow") to be administered by Escrow Holder. The Escrow for the Property shall be deemed
open ("Opening of Escrow") upon the receipt by the Escrow Holder of a fully executed copy of
this Agreement. The Escrow Holder shall promptly confirm to the parties the escrow number
and the title insurance order number assigned to the Escrow.
(b) In the event that either Robbins has not delivered its Due Diligence Approval
Certificate (as provided in Section 2.11) to the Agency and the Escrow Holder or the Agency has
not delivered its Due Diligence Approval Certificate (as provided in Section 2.11) to Robbins
and the Escrow Holder for the Property within IS days of the Opening of Escrow, the provisions
of Section 4.01 regarding termination of this Agreement shall apply. If this Agreement is
terminated as provided in Section 4.01, notwithstanding Section 2.05, Robbins shall be solely
responsible to the Escrow Holder for all customary and reasonable escrow cancellation charges
payable to the Escrow Holder without further or separate instruction to the Escrow Holder, and
the parties shall each be relieved and discharged from all further responsibility or liability under
this Agreement.
Section 2.05. Supplemental Escrow Instructions. In addition to the jointly approved
escrow instructions referred to in Section 2.02(b), Robbins and the Agency each agree to execute
the customary supplemental escrow instructions of the Escrow Holder in the form provided by
/~. the Escrow Holder to its clients in real property escrow transactions administered by it, subject to
'-- the same being reasonably acceptable to Robbins and the Agency. In the event of a conflict
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between the additional terms of such customary supplemental escrow instructions of the Escrow
Holder and the provisions of this Agreement, this Agreement shall supersede and be controlling.
Upon any termination of this Agreement or cancellation of the Escrow except as results from the
default of the Agency, Robbins shall be solely responsible for the payment of the escrow
cancellation costs of the Escrow Holder, except that the Agency shall be responsible if such
termination is the result of the default of the Agency.
Section 2.06. Convevance of Title.
(a) On or before the day designated as the date for the Close of Escrow (the "Closing
Date"), the Agency shall deliver to the Escrow Holder the Agency Quitclaim Deed duly executed
and acknowledged by the Agency, which Agency Quitclaim Deed shall relinquish all of its right,
title and interest of the Agency in the Agency Property to Robbins. The Escrow Holder shall be
instructed to record the Agency Quitclaim Deed in the Official Records of San Bernardino
County, California, if and when the Escrow Holder holds the various instruments and funds for
the accounts of the parties as set forth herein and can obtain for either party if requested, a CL T A
owner's extended coverage policy of title insurance ("Title Policy") issued by the Title Company
or such other title insurance company mutually agreed upon by the parties with liability in an
amount equal to such amount as determined by and between Robbins and the Title Company
together with such endorsements to the policy as may be reasonably requested by Robbins,
insuring that fee title to the Agency Property is vested in Robbins, free and clear of options,
rights of first refusal or other purchase rights, leases or other possessory interests, lis pendens
and monetary liens and/or encumbrances and subject only to:
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(I) non-delinquent real property taxes;
(2) non-monetary title exceptions approved by the Purchaser pursuant to Section 2.14
below;
(3) the Redevelopment Plan and the City adopted Specific Plan;
(4) such other title exceptions, if any, resulting from documents being recorded or
delivered through Escrow.
(b) On or before the Closing Date, Robbins shall deliver to the Escrow Holder the
Robbins Quitclaim Deed duly executed and acknowledged by Robbins, which Robbins
Quitclaim Deed shall relinquish all of its right, title and interest of Robbins in the Exchange
Property to the Agency. The Escrow Holder shall be instructed to record the Robbins Quitclaim
Deed in the Official Records of San Bernardino County, California, if and when the Escrow
Holder holds the various instruments and funds for the accounts of the parties as set forth herein
and can obtain for either party if requested, a CLTA owner's extended coverage policy of title
insurance ("Title Policy") issued by the Title Company or such other title insurance company
mutually agreed upon by the parties with liability in an amount equal to such amount as
determined by and between the Agency and the Title Company together with such endorsements
r to the policy as may be reasonably requested by the Agency, insuring that fee title to the
'- Exchange Property is vested in the Agency, free and clear of options, rights of first refusal or
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other purchase rights, leases or other possessory interests, lis pendens and monetary liens and/or
encumbrances and subject only to:
(I) non-delinquent real property taxes;
(2) non-monetary title exceptions approved by the Agency pursuant to Section 2.14;
(3) such other title exceptions, if any, resulting from documents being recorded or
delivered through Escrow
Section 2.07. Additional Closing Obligations of Agencv. Before the Close of Escrow,
the Agency shall deliver to the Escrow Holder copies of the following documents and other
items:
(I) a certificate of non-foreign status (the "Non-Foreign Affidavit") executed by the
Agency, in the customary form provided by the Escrow Holder, and a California
Franchise Tax Board Form 590-RE executed by the Agency;
(2) two duplicate original copies of the Closing Statement, duly approved by the
Agency;
(3)
evidence of the existence, organization and authority of the Agency and of the
authority of persons executing documents on behalf of the Agency reasonably
satisfactory to the Escrow Holder, Robbins and the Title Company;
(4) an acknowledgment and acceptance of the Robbins Quitclaim Deed, duly
executed and acknowledged by the Agency; and
(5) any other documents, instruments and records required to be delivered to Robbins
under the terms of this Agreement or as otherwise required by the Escrow Holder
or the Title Company under the terms of this Agreement in order to Close Escrow
which have not been previously delivered.
Section 2.08. Closing Obligations of Robbins. Before the Close of Escrow, Robbins
shall deliver to the Escrow Holder copies of the following documents and other items:
(I) an acknowledgment and acceptance of the Agency Quitclaim Deed, duly executed
and acknowledged by Robbins;
(2) two duplicate original copies of the Closing Statement, duly approved by
Robbins;
(3) deposit of the original duly executed Note and original duly executed and
acknowledged Deed of Trust; and
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(4)
any other documents, instruments or funds required to be delivered by Robbins
under the terms of this Agreement or as othelWise required by the Escrow Holder
or the Title Company in order to close Escrow which have not previously been
delivered.
Section 2.09. Inspections and Review.
(a) Agencv Due Diligence Items. Within five days after the execution of this
Agreement by the authorized officers of the Agency, the Agency shall deliver true, correct and
complete copies or originals of the following documents and items (collectively, "Agency Due
Diligence Items") to Robbins to the extent such Agency Due Diligence Items have not
previously been (i) delivered to Robbins, or (ii) reviewed by Robbins, or (iii) othelWise in the
possession of Robbins prior to the execution of this Agreement:
(I) copies of all soils, seismic, geologic, drainage, engineering, environmental and
similar type reports and surveys (including, but not limited to, any Property
Environmental Site Assessments) relating to the Agency Property if any, in the
possession or control of the Agency.
(2) notices of violations, including, but not limited to, zoning ordinances,
development or building codes affecting the Agency Property within the
Agency's possession or control.
(3)
a copy of the Redevelopment Plan for the Central City North Redevelopment
Project.
(4) disclosure of any legal matters affecting the use or condition of the Agency
Property to the knowledge of the Agency.
The Agency shall deliver to Robbins, promptly after receipt thereof, any other items described
above received by the Agency after the initial delivery to Robbins as provided above. In
addition, promptly following request by Robbins during the Due Diligence Period, the Agency
shall deliver such other matters in its possession or control as reasonably requested by Robbins
from time to time.
(b) Robbins Due Diligence Items. Within five days after the execution of this
Agreement by Robbins, Robbins shall deliver true, correct and complete copies or originals of
the following documents and items (collectively, "Robbins Due Diligence Items") to the Agency
to the extent such Robbins Due Diligence Items have not previously been (i) delivered to the
Agency, or (ii) reviewed by the Agency, or (iii) othelWise in the possession of the Agency prior
to the execution of this Agreement:
(I)
copies of all soils, seismic, geologic, drainage, engineering, environmental and
similar type reports and surveys (including, but not limited to, any Property
Environmental Site Assessments) relating to the Exchange Property if any, in the
possession or control of Robbins.
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(2)
notices of violations, including, but not limited to, zoning ordinances,
development or building codes affecting the Exchange Property within the
Robbins' possession or control.
(3) disclosure of any legal matters affecting the use or condition of the Exchange
Property to the knowledge of Robbins.
Robbins shall deliver to the Agency, promptly after receipt thereof, any other items described
above received by Robbins after the initial delivery to the Agency as provided above. In
addition, promptly following request by the Agency during the Due Diligence Period, Robbins
shall deliver such other matters in its possession or control as reasonably requested by the
Agency from time to time.
(c) Certain Definitions. For the purpose of this Agreement, the terms set forth below
shall have the following meaning:
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(i) "environmental laws" means all federal, state, local, or municipal laws,
rules, orders, regulations, statutes, ordinances, codes, or decrees, regulating, relating to,
or imposing liability of standards of conduct concerning any hazardous substance (as
later defined), or pertaining to occupational health or industrial hygiene (and only to the
extent that the occupational health or industrial hygiene laws, ordinances, or regulations
relate to hazardous substances on, under, or about the Property), occupational or
environmental conditions on, under, or about the Property, as now or may at any later
time be in effect, including without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 ("CERCLA") [42 USC Section 9601
et seq.]; the Resource Conservation and Recovery Act of 1976 ("RCRA") [42 USC
Section 6901 et seq.]; the Clean Water Act, also known as the Federal Water Pollution
Control Act ("FWPCA") [33 USC Section 1251 et seq.]; the Toxic Substances Control
Act ("TSCA") [15 USC Section 2601 et seq.]; the Hazardous Materials Transportation
Act ("HMTA") [49 USC Section 1801 et seq.]; the Insecticide, Fungicide, Rodenticide
Act [7 USC Section 6901 et seq.] the Clean Air Act [42 USC Section 7401 et seq.]; the
Safe Drinking Water Act [42 USC Section 300f et seq.]; the Solid Waste Disposal Act
[42 USC Section 6901 et seq.]; the Surface Mining Control and Reclamation Act [30
USC Section 101 et seq.] the Emergency Planning and Community Right to Know Act
[42 USC Section 11001 et seq.]; the Occupational Safety and Health Act [29 USC
Section 655 and 657]; the California Underground Storage of Hazardous Substances Act
[H & S C Section 25288 et seq.]; the California Hazardous Substances Account Act [H &
S C Section 25300 et seq.]; the California Safe Drinking Water and Toxic Enforcement
Act [H & S C Section 24249.5 et seq.] and the Porter-Cologne Water Quality Act [Water
Code Section 13000 et seq.] together with any amendments of or regulations promulgated
under the statutes cited above and any other federal, state, or local law, statute, ordinance,
or regulation now in effect or later enacted that pertains to occupational health or
industrial hygiene, and only to the extent the occupational health or industrial hygiene
laws, statutes, ordinances, or regulations relate to hazardous substances on, under, or
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about the Property, or the regulation or protection of the environment, including ambient
air, soil, soil vapor, groundwater, surface water, or land use.
(ii) "hazardous substances" includes without limitation:
those substances included within the definitions of "hazardous substance," "hazardous waste,"
"hazardous material," "toxic substance," "solid waste," or "pollutant or contaminate" in
CERCLA, RCRA, TSCA, HMT A, or under any other environmental law; and
those substances listed in the United States Department of Transportation (DOT)Table [49 CFR
172.101], or by the EPA, or any successor agency, as hazardous substances [40 CFR Part 302];
and
other substances, materials, and wastes that are or become regulated or classified as hazardous or
toxic under federal, state, or local laws or regulations; and
any material, waste, or substance that is:
(I) a petroleum or refined petroleum product,
(2) asbestos,
(3)
polychlorinated biphenyl,
(4) designated as a hazardous substance pursuant to 33 USC Section 1321 or listed
pursuant to 33 USC Section 1317,
(5) a flammable explosive, or
(6) a radioactive material.
Section 2.10. Due Diligence Investigation of the Property.
(a) Within fifteen (15) days from and after the Opening of Escrow, and subject to the
extensions of time set forth below in Section 2.14, the parties shall have the right to examine,
inspect and investigate the respective portion of the Property (the "Due Diligence Period") to
determine whether the condition of that portion of the Property is acceptable to the respective
party.
(b) During the Due Diligence Period, each respective party shall permit the other
party, its engineers, analysts, contractors and agents to conduct such physical inspections and
testing of the respective portion of the Property as that party deems prudent with respect to the
physical condition of such portion of the Property, including the inspection or investigation of
soil and subsurface soil geotechnical condition, drainage, seismic and other geological and
topographical matters, surveys the potential presence of any hazardous substances, if any.
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(c) Any such investigation work on the Property may be conducted by the either
party and/or their agents during any normal business hours upon seventy-two (72) hours prior
notice to the other party, which notice will include a description of any investigation work or
tests to be conducted by the such party on the particular portion of the Property. Upon request,
the testing party will provide the non-testing party with copies of any test results.
(d) During the Due Diligence Period, the parties shall also have the right to
investigate all matters relating to the zoning, use and compliance with other applicable laws,
which relate to the use and development and improvement of the Property.
(e) Each respective party shall cooperate fully to assist the other party in completing
such inspections and investigations of the condition of the Property. Both parties shall have the
right, but not the obligation, to attend any such investigations and/or inspections. Robbins shall
pay for all costs and expenses associated with the conduct of his Due Diligence investigation and
the Agency shall pay for all costs and expenses associated with the conduit of its Due Diligence
investigation.
Section 2.11. Due Diligence Certificate. Within fifteen (15) days following the Opening
of Escrow, each party shall complete its own investigation of the respective portion of the
Property (subject to the extensions of time set forth in Section 2.14) and deliver an executed due
diligence certificate (the "Due Diligence Certificate") to the Escrow Holder which either:
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(a) indicates that the party accepts the condition of the respective portion of the
Property or;
(b) contains a description of the matters or exceptions relating to the condition of the
respective portion of the Property which the that party was not able to accept or resolve to its
satisfaction during the Due Diligence Period.
Section 2.12. Books and Records. As part of the due investigations during the Due
Diligence Period, each party shall be afforded full opportUnity by the other party to examine all
books and records which relate to the respective portion of the Property in the possession of the
other party and/or the party's agents or employees, including the reasonable right to make copies
of such books and records. During the Due Diligence Period, the Agency will make sufficient
staff available to assist Robbins with obtaining access to information relating to the Agency
Property, which is in the possession or control of Agency.
Section 2.13. Condition of the Propertv. Each party acknowledges and agrees that it
shall be given a full opportUnity under this Agreement to inspect and investigate every aspect of
the Property during the Due Diligence Period. Each party shall accept the delivery of possession
the particular portion of the Property that party, and each of them is purchasing on the Close of
Escrow in an "AS IS", "WHERE IS" and "SUBJECT TO ALL FAULTS" condition. The each
party further agrees and represents to the other respective party that by a date no later than the
end of the Due Diligence Period, that party shall have conducted and completed (or waived the
,r-' completion) of all of its independent investigation of the condition of the Property. Each party
'- hereby acknowledges that it shall rely solely upon its own investigation of the Property and its
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own review of such information and documentation as it deems appropriate for the purpose of
accepting the condition and possession of its portion of the Property. Neither party is relying on
any statement or representation by the other respective party relating to the condition of the
Property unless such statement or representation is specifically contained in this Agreement.
Without limiting the foregoing, neither party makes any representations or warranties as to
whether any portion of the Property presently complies with environmental laws or whether any
portion of the Property contains any hazardous substance, as these terms are defined in Section
2.09(c) hereof. Furthermore, to the extent that a party has provided the other respective party
with information relating to the condition of any portion of the Property, including information
and reports prepared by or on behalf of the City of San Bernardino, neither party makes any
representation or warranty with respect to the accuracy, completeness or methodology or content
of such reports or information.
Without limiting the above, except to the extent covered by an express representation or
warranty of either party set forth in this Agreement, each respective party, on behalf of itself and
its successors and assigns, waives and release the other respective party and its successors and
assigns from any and all costs or expenses whatsoever (including, without limitation, attorneys'
fees and costs), whether direct or indirect, known or unknown, foreseen or unforeseen, arising
from or relating to the physical condition of the portion of the Property be transferred by such
party, the condition of the soils, the suitability of the soils for improvement, or any law or
regulation applicable thereto, including the presence or alleged presence of harmful or hazardous
substances in, under or about that portion of the Property including, without limitation, any
claims under or on account of (i) CERCLA and similar statutes and any regulations promulgated
thereunder or (ii) any other environmental laws.
With respective to the portion of the Property being transferred to each respective party,
each party expressly waives any rights or benefits available to it with respect to the foregoing
release under any provision of applicable law which generally provides that 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 the release is agreed to, which, if known to such creditor, would materially affect a
settlement. By execution of this Agreement, the parties acknowledge that they fully understand
the foregoing, and with this understanding, nonetheless elects to and does assume all risk for
claims known or unknown, described in this Section 2.13 without limiting the generality of the
foregoing:
The undersigned acknowledges that it has been advised by legal counsel and is
familiar with the provisions of California Civil Code Section ] 542, which
provides as follows:
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"A GENERAL RELEASE DOES NOT EXTEND
TO CLAIMS WHICH THE CREDITOR DOES
NOT KNO\VN OR SUSPECT TO EXIST IN HIS
FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM, MUST
HA VE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR."
The undersigned, being aware of this code section, hereby expressly waives any rights it
may have thereunder, as well as under any other statutes or common law principles of similar
effect
Initials of Robbins:
Initials of Agency:
The provisions of this Section 20 I 3 shall survive the Close of Escrow.
Section 2.14. Review and Approval of Condition of Title.
(a) Within fifteen (15) days following the Opening of Escrow, each party shall cause
to be delivered to the other respective party a preliminary title report or title commitment for an
AL T A extended coverage policy of title insurance issued by the Title Company, describing the
state of title of the particular portion of the Property to be transferred by that party, together with
copies of all exceptions specified therein and with all easements plotted, (the "Preliminary Title
Report"). A party shall notify the other party in writing of any objections it may have to the title
exceptions contained in the Preliminary Title Report ("Title Objection Notice") prior to the
expiration of the Due Diligence Period. The party upon which notice was sent shall have a
period of five (5) days after receipt of such Title Objection Notice in which to deliver written
notice to the party sending notice ("Title Notice") of such party's election to either (i) agree to
remove the objectionable items prior to the Close of Escrow, or (ii) decline to remove any such
title exceptions; provided, however, that such party shall be required to remove all monetary
liens and encumbrances created by or as a result of such party's activities. If a party receiving
the Title Objection Notice notifies the objecting party of its election to terminate Escrow rather
than remove the objectionable items, the objecting party shall have the right, by written notice
delivered to the other party within five (5) days after the its receipt of the Title Notice, to agree to
accept the portion of the Property subject to the objectionable items, in which event the election
to terminate the Escrow shall be of no effect, and the party shall take title at the Close of Escrow
subject to such objectionable title items.
(b) The parties covenant not to further encumber and not to place any further liens or
encumbrances on any portion of the Property, including, but not limited to, covenants,
conditions, restrictions, easements, liens, options to purchase, options to lease, leases, tenancies,
or other possessory interests without the prior written consent of the other party. Upon the
issuance of any amendment or supplement to the Preliminary Title Report which adds additional
exceptions, the foregoing right of review and approval shall also apply to said amendment or
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supplement (provided that the period for the respective party to review such amendment or
supplement shall be the later of the expiration of the Due Diligence Period or ten (10) days from
receipt of the amendment or supplement) and Escrow shall be deemed extended by the amount
of time necessary to allow such review and approval in the time and manner set forth above.
ARTICLE III
Section 3.01. Uses.
(a) Acknowledgements of Robbins.
Robbins acknowledges and agrees for itself, its successors and assigns that the Agency
Property may be used for any lawful purpose so long as such use is in compliance with the
General Plan, the Redevelopment Plan and the Zoning Plan, in existence and as each may be
amended from time to time by the City, the Agency or other authorized governmental agency.
The provisions of this Section 3.01(a) shall run with the land as set forth in the Agency
Quitclaim Deed.
(b) Robbins covenants for itself, its successors and assigns that, unless otherwise
consented to in writing by the Agency, in the event the Agency Property, or any portion thereof
is used by an owner that is partially or wholly exempt from the payment of ad valorem property
taxes pertinent to the Agency Property, or portion thereof, and does not make the tax payment for
any year based on that exemption, then in such event the owner of the Agency Property, shall
pay the Agency a fee in lieu of payment of property taxes each year thereafter in an amount
equal to the applicable percentage of the full cash value as determined in accordance with the
State Construction Article XIIIA and other state law for the property, or portion thereof which is
subject to the exemption, unless the Agency consents otherwise in writing. In the event that the
in-lieu payment referenced above is due by the owner for any year, then such amount shall be
paid to the Agency for the tax year within 90 calendar days following transmittal of notice of
invoice by the Agency for payment of the in-lieu amount addressed to the owner of the Agency
Property as disclosed in the property tax records of the County of San Bernardino.
(c) The provisions of Section 3.01(b) shall run with the land as set forth In the
Agency Quitclaim Deed.
Section 3.02. Modification of Covenants. The provisIOns of this Article III may be
amended, modified or waived following the Close of Escrow as provided in the Agency Quit
Claim Deed.
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C Section 3.03. Obligation to Refrain from Discrimination. In accordance with California
Health and Safety Code Sections 33435 and 33436, Robbins covenants and agrees for itself, its
successors, its assigns and every successor in interest to the Agency Property or any part thereof,
tbat there shall be no discrimination against or segregation of any person, or group of persons, on
account of sex, marital status, race, color, religion, creed, national origin or ancestry in the sale,
lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Agency Property; nor shall
Robbins, himself, or any person claiming under or through it, 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, sublessee or vendees of the Agency
Property.
Section 3.04. Form of Nondiscrimination and Nonsegregation Clauses.
acknowledges that the Agency Quit Claim Deed contains the following provision:
Robbins
"The grantee herein covenants by and for itself, its successors 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 of race, color, creed, religion, sex, marital status,
national origin, or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or
enjoyment of the premises herein conveyed, nor shall the grantee or any person claiming under
or through it, 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, sublessee, or vendees in the premises herein conveyed. The foregoing covenants
shall run with the land."
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Section 3.05. No Liability for Breach to a Predecessor in Interest. A breach or a
violation by an owner of the Agency Property, or a portion thereof, of a covenant set forth in this
Article III shall not subject such owner's predecessor in interest in the Agency Property to any
liability for such breach or violation. A breach by a tenant on the Agency Property of Section
3.03 or Section 3.04 shall not subject such tenant's landlord to liability for the breach by such
tenant.
Section 3.06. Agencv Ouit Claim Deed. All of the provisions in Sections 3.01 to 3.05,
inclusive, shall be included in the Agency Quit Claim Deed. Accordingly, Sections 3.01 to 3.05,
inclusive, shall not survive the Close of Escrow except as personal covenants of Robbins.
ARTICLE IV
Section 4.01. Defaults and Remedies.
(a) In the event all of Robbins conditions precedent to the Close of Escrow are
satisfied or waived by Robbins, and Robbins defaults in the performance of its obligations under
this Agreement, and such default continues for five days after the Agency gives Robbins written
notice thereof, then the Agency may exercise all available remedies at law or in equity,
including, without limitation, specific performance.
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(b) In the event all of the Agency's conditions precedent to the Close of Escrow have
been satisfied or waived, and the Agency defaults in the performance of its obligations hereunder
and has not cured such default within ten (10) calendar days after Robbins gives the Agency
written notice thereof, or has not commenced to cure within ten (10) calendar days of such notice
if such default cannot be cured within ten (10) calendar days and thereafter diligently pursued
such cure, then Robbins may exercise all available remedies at law or in equity, including,
without limitation, specific performance.
(c) Notwithstanding the above, a breach of any obligation of either of the parties
under this Agreement that by its terms survives the termination of this Agreement or the Close of
Escrow, shall entitle the other party to exercise all available remedies, at law or in equity, with
respect to such breach subject to the limitations set forth in this Agreement regarding limitations
of the liability of the Agency.
(d) The laws of the State of California shall govern the interpretation and
enforcement of this Agreement.
(e) In the event that any legal action is commenced by Robbins against the Agency,
service of process on the Agency shall be made by personal service upon the Executive Director
of the Agency, or in such other manner as may be provided by law.
(I) In the event that any legal action is commenced by the Agency against Robbins,
service of process on Robbins shall be made by personal service on Robbins (or such other
Agent for service of process and at such address as may be specified in written notice to the
Agency), or in such other manner as may be provided by law, and shall be valid whether made
within or without the State of California.
Section 4.02. Rights and Remedies are Cumulative. Except as otherwise expressly
provided in this Agreement, the rights and remedies of the parties as set forth in this Article IV
are cumulative and the exercise by either party of one or more of such rights or remedies shall
not preclude the exercise by it, at the same or different times, of any other rights or remedies for
the same default or any other default by the other party.
ARTICLE V
Section 5.01. Notices, Demands and Communications Between the Parties.
(a) Any and all notices, demands or communications submitted by any party to
another party pursuant to or as required by this Agreement shall be proper if in writing and
dispatched by messenger for immediate personal delivery, or by registered or certified United
States mail, postage prepaid, return receipt requested, or transmitted by fax and confirmed by the
sender by First Class United States Mail postage prepaid or by personal delivery and in each
case, addressed to the principal office of the Agency and Robbins, as applicable, as designated in
Section 1.03(a) and Section 1.03(b) hereof. Courtesy copies of notices, demands or
communications submitted by Robbins to the Agency shall be submitted to:
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James F. Penman
City Attorney
300 North "D" Street
San Bernardino, California 92418
Timothy J. Sabo
Lewis Brisbois Bisgaard Smith LLP
650 E. Hospitality Lane, Suite 600
San Bernardino, California 92408
Such written notices, demands and communications may be sent in the same manner to such
other addresses as either party may from time to time designate as provided in this Section. Any
such notice, demand or communication shall be deemed to be received by the addressee,
regardless of whether or when any return receipt is received by the sender on the date set forth on
such return receipt, on the day that it is dispatched by messenger for immediate personal
delivery, the date sent by FAX and confirmed by First Class United States Mail or two (2)
calendar days after it is placed in the United States Mail or personal delivery as heretofore
provided.
Section 5.02. Conflict of Interest. No member, official or employee of the Agency
having any conflict of interest, direct or indirect, related to this Agreement and the transfer of the
Property shall participate in any decision relating to the Agreement. The parties represent and
warrant that they do not have knowledge of any such conflict of interest.
Section 5.03. Warrantv Against Payment of Consideration for Agreement. Robbins
warrants that it has not paid or given, and will not payor give, any third party any money or
other consideration for obtaining this Agreement. Third parties, for the purposes of this Section,
shall not include persons to whom fees are paid for professional services if rendered by
attorneys, financial consultants, accountants, engineers, architects and the like when such fees
are considered necessary by Robbins.
Section 5.04. Nonliability of Agency Officials and Employees. No officer, official or
employee of the Agency (or member unit of local government of the Agency or any officer,
official or employee of any of them) shall be personally liable to Robbins, or any successor in
interest of Robbins, in the event of any default or breach by the Agency or for any amount which
may become due to Robbins or to its successor, or on any obligations under the terms of this
Agreement, except for gross negligence or willful acts of such member, officer or employee
Section 5.05. Enforced Delav: Extension of Time of Performance.
(a) Performance by either party hereunder shall not be deemed to be in default, or
considered to be a default, where delays or defaults are due to the force majeure events of war,
insurrection, strikes, lockouts, riots, floods, earthquakes, fires, casualties, acts of God, acts of the
public enemy, epidemics, quarantine restrictions, freight embargoes or weather-caused delays
(that are not attributable to the fault of the party claiming an extension of time) or acts or failure
to act of any public or governmental agency or entity (provided that acts or failure to act of the
Agency shall not extend the time for the Agency to act hereunder except as provided in Section
5.05(b)). An extension of time for any such force majeure cause shall be for the period of the
enforced delay and shall commence to run from the date of occurrence of the delay; provided,
however, that the party claiming the existence of the delay first provide the other party with
written notice of the occurrence of the delay within ten (10) calendar days of the occurrence of
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the event giving rise to delay, The parties hereto expressly acknowledge and agree that changes
in either general economic conditions or changes in the economic assumptions of any of them
which may have provided a basis for entering into this Agreement and which occur at any time
after the execution of this Agreement, are not force majeure events and do not provide any party
with grounds for asserting the existence of a delay in the performance of any covenant or
undertaking which may arise under this Agreement. Each party expressly assumes the risk that
changes in general economic conditions or changes in such economic assumptions relating to the
terms and covenants of this Agreement could impose an inconvenience or hardship on the
continued performance of such party under this Agreement, but that such inconvenience or
hardship is not a force majeure event and does not excuse the performance by such party of its
obligations under this Agreement.
(b) Robbins acknowledges that the Agency is a "public entity" and/or a "public
agency" as defined under applicable California law. Therefore, the Agency must satisfy the
requirements of certain California statutes relating to the actions of public entities, including,
without limitation, the California Environmental Quality Act ("CEQA"). Also, as a public body,
the Agency's action in approving this Agreement may be subject to proceedings to invalidate the
Agreement. Robbins hereby assumes the risk of delays and damages that may result to Robbins
from any such third-party legal actions related to the Agency's approval of this Agreement or
contemplated by this Agreement, even in the event that an error, omission or abuse of discretion
by the Agency is determined to have occurred. If a third-party files a legal action regarding the
Agency's approval of this Agreement or the transfer of the Property as contemplated by this
Agreement, the Agency may terminate this Agreement on 60 calendar days' written notice to
Robbins of the Agency's intent to terminate this Agreement, referencing this Section 5.05(b),
without any further obligation to perform the terms of this Agreement or any liability to Robbins
resulting from such termination unless Robbins agrees to defend the Agency against such third-
party legal action as provided below. Within 30 calendar days after receipt of the Agency's
notice of intent to terminate this Agreement as provided in the preceding sentence, Robbins may
offer to defend the Agency in the third-party legal action and pay all of the court costs, attorney
fees, monetary awards, sanctions, attorney fee awards and the expenses of any and all financial
or performance obligations that may result from the disposition of the legal action. Any such
offer from Robbins must be in writing and in a form reasonably acceptable to the Agency.
(c) Robbins acknowledges that the Agency is a redevelopment agency under the
California Community Redevelopment Law. Therefore, the Agency must satisfy the
requirements of the California Community Redevelopment Law. The Agency's action in
approving this Agreement may be subject to proceedings to invalidate the Agreement. Robbins
hereby assumes the risk of delays and damages that may result to Robbins from any such third-
party legal actions claiming noncompliance with the Community Redevelopment Law related to
the Agency's approval of this Agreement, even in the event that an error, omission or abuse of
discretion by the Agency is determined to have occurred. If a third-party files a legal action
regarding the Agency's approval of this Agreement or the transfer of the Property as
contemplated by this Agreement, the Agency may terminate this Agreement pursuant to the same
notices, options and procedures set forth in Section 5.05(b) of this Agreement.
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_ Section 5.06. Inspection of Books and Records. The Agency shall have the right at all
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~ reasonable times at the Agency's cost and expense to inspect the books and records of Robbins
pertaining to the Property and/or the development thereof as necessary for the Agency, in its
reasonable discretion, to enforce its rights under this Agreement. Matters discovered by the
Agency shall not be disclosed to third parties unless required by law or unless otherwise
resulting from or related to the pursuit of any remedies or the assertion of any rights of the
Agency hereunder. Robbins shall also have the right at all reasonable times to inspect the books
and records of the Agency pertaining to the Property and/or the development thereof as pertinent
to the purposes of this Agreement. Notwithstanding the foregoing, neither party shall have any
right to inspect books and/or records that contain attorney/client communications or other
attorney work product.
Section 5.07. Approvals.
(a) Approvals required of the Agency or Robbins, or any officers, agents or
employees of either the Agency or Robbins, shall not be unreasonably withheld and approval or
disapproval shall be given within the time set forth in this Agreement or, if no time is given,
within a reasonable time.
(b) All material amendments to this Agreement must be approved by the Agency
pursuant to official action of its Board at a duly noticed and held public meeting.
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Section 5.08. Real Estate Commissions. The Agency shall not be liable for any real
estate commissions, brokerage fees or finder fees which may arise from or be related to this
Agreement unless such liability arises from the act or contract of the Agency. Robbins shall not
be liable for any real estate commissions, brokerage fees or finder fees which may arise from or
be related to this Agreement unless such liability arises from the act or contract of Robbins.
Section 5.09. Attornevs' Fees. If either party hereto files any action or brings any action
or proceeding against the other arising out of this Agreement, or is made a party to any action or
proceeding brought by the Escrow Agent, then as between Robbins and the Agency, the
prevailing party shall be entitled to recover as an element of its costs of suit, and not as damages,
its reasonable attorneys' fees as fixed by the Court, in such action or proceeding or in a separate
action or proceeding brought to recover such attorneys' fees. The costs, salary and expenses of
the City Attorney and members of his office in enforcing this Agreement shall be considered as
"attorneys' fees" for purposes of this Section.
Section 5.10. Effect. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective heirs, executors, administrators, legal representatives,
successors and assigns.
Section 5. 11. Tax Deferred Exchange. Robbins intends to use the proceeds of the
Exchange Property to affect a tax deferred exchange under Internal Revenue Code Section 1031.
The Agency agrees to accommodate Robbins in effecting such tax deferred exchange. The
,.- Agency agrees to execute such additional escrow instructions, deeds, documents, agreements or
'- instruments to effect this exchange, provided that the Agency does not incur any additional costs,
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expenses or liabilities in this transaction as a result of or in connection with this exchange. By
agreeing to the foregoing the Agency is merely making an accommodation on behalf of Robbins
and is in no way endorsing, approving, recommending or advising Robbins as to the validity or
personal beneficial outcome of such tax deferred exchange. Robbins agrees to hold the Agency
harmless of any liability, damages or costs, including reasonable attorney's fees that may arise
from the Agency's participation in such exchange and further acknowledges that he did not
obtain nor is relying on the advice of the Agency or any of its officers, agents and employees as
to the validity and/or personal benefit of such exchange.
Section 5.12. Miscellaneous.
(a) This Agreement may be executed in multiple counterparts, each of which shall be
deemed an original and together shall constitute one and the same agreement, with one
counterpart being delivered to each party hereto.
(b) All periods of time referred to in this Agreement shall include all Saturdays,
Sundays and state or national holidays, unless the period of time specifies business days,
provided that if the date or last date to perform any act or give any notice with respect to this
Agreement shall fall on a Saturday, Sunday or state or national holiday, such act or notice may
be timely performed or given on the next succeeding day which is not a Saturday, Sunday or
state or national holiday.
(c) The unenforceability, invalidity, or illegality of any provision of this Agreement
shall not render the other provisions hereof unenforceable, invalid or illegal.
Section 5.13. Release and Waiver.
(a) In consideration of the Agency approving and entering into this Agreement,
Robbins hereby releases and forever discharges the Agency, and each and all of its member
entities, their representatives, associates, predecessors, successors, heirs, assigns, agents,
representatives, attorneys, and all persons acting by, through, under or in concert with the
Agency of and from any and all manner of action or actions, cause or causes of action, at law or
in equity, suits, debts, liens, contracts, agreements, promises, liabilities, claims, rights,
obligations, demands, damages, losses, costs or expenses, of any nature whatsoever, known or
unknown, fixed or contingent (collectively referred to herein as "Claims"), which Robbins now
has or may hereafter have against the Agency, or any of the above persons or entities by reason
of or related to punitive damages allegedly arising from or in connection with a breach of this
Agreement or any action or omission to act by the Agency.
(b) By releasing and forever discharging Claims both known and unknown, as above
provided, Robbins expressly waives any rights under California Civil Code Section 1542 which
provides:
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"A general release does not extend to claims which the creditor does not know of or suspect to
exist in his favor at the time of executing the release, which if known by him must have
materially affected his settlement with the debtor," as well as under any other statutes and/or
common law principles of similar effect arising in any jurisdiction.
Initials of Robbins:
Section 5.14. Entire Agreement. This Agreement includes _ pages and _ exhibits,
which constitute the entire understanding and Agreement of the parties.
Section 5.15. Integration. This Agreement integrates all of the terms and conditions
mentioned herein or incidental hereto with respect to the Property, and supersedes all
negotiations or previous agreements between the parties with respect to all or any portion of the
Property.
Section 5.16. Waiver/Amendment. All waivers of the provisions of this Agreement and
all amendments hereto must be in writing and signed by the appropriate authority of the Agency
and Robbins.
Section 5.17. Headings. The headings to the paragraphs of this Agreement are for
convenience of reference only, do not form a part of this Agreement and shall not in any way
affect its interpretation.
C Section 5.18. Time of Essence. Time is expressly declared to be of the essence of this
Agreement.
Section 5.19. Assignment. Robbins shall not assign his interests in this Agreement.
Section 5.20. Binding on Heirs and Successors. This Agreement shall be binding on
and shall inure to the benefit of the heirs, executors, administrators, successor, and assigns ofthe
parties hereto, but nothing in this Section 5.20 shall be construed as a consent by the Agency to
any assignment of this Agreement by Robbins.
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IN WITNESS WHEREOF, the parties have signed this Agreement as of the date first set
forth above.
REDEVELOPMENT AGENCY OF THE CITY
OF SAN BERNARDINO
By:
Gary Van Osdel
Executive Director
ROBBINS
By:
Stan Robbins
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EXHIBIT "A"
LEGAL DESCRIPTION OF EXCHANGE PROPERTY
PARCEL 1: APN: 0134-101-09
THAT PORTION OF LOTS 7 AND 8, BLOCK 27, IN THE CITY OF SAN BERNARDINO,
COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT RECORDED
IN BOOK 7 OF MAPS, PAGE I, RECORDS OF SAID COUNTY DESCRIBED AS
FOLLOWS:
COMMENCING AT A POINT 148 FEET, 6 INCHES SOUTH OF THE NORTHEAST
CORNER OF LOT 8; RUNNING THENCE WEST 180 FEET; THENCE SOUTH 50 FEET;
THENCE EAST 35 FEET; THENCE SOUTH 2 FEET; THENCE EAST 145 FEET TO WEST
LINE OF "F" STREET; THENCE NORTH ALONG WEST LINE OF "F" STREET TO THE
POINT OF BEGINNING.
PARCEL 2: APN: 0134-101-10
ALL THAT PORTION OF LOTS 7 AND 8, BLOCK 27, IN THE CITY OF SAN
BERNARDINO, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS
PER PLAT RECORDED IN BOOK 7 OF MAPS, PAGE I, RECORDS OF SAID COUNTY,
DESCRIBED AS FOLLOWS:
COMMENCING 200 FEET 6 INCHES SOUTH OF THE NORTHEAST CORNER OF SAID
LOT 8; THENCE WEST 157 FEET 9 INCHES; THENCE SOUTH 86-1/2 FEET, MORE OR
LESS, TO THE NORTH LINE OF AN ALLEY; THENCE EAST 157 FEET 9 INCHES TO
THE EAST LINE OF SAID LOT 8; THENCE NORTH 86-1/2 FEET, MORE OR LESS, TO
THE POINT OF BEGINNING.
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EXHIBIT "8"
LEGAL DESCRIPTION OF AGENCY PROPERTY
PARCEL I: APN: 0134-081-10
All that portion of Lot I, Block 36, City of San Bernardino, in the City of San Bernardino, County of San
Bernardino, State of California, as per map recorded in Book 7, of maps, records of said County,
described as follows:
Commencing 50 Feet South of the Northeast comer of said Lot I; thence South along the East line of said
Lot 1 to the Southeast comer thereof; thence West along the South line of said Lot I; 140 Feet to a point
159 Feet East of the Southwest Comer of said Lot I; Thence North and parallel with the East line of said
Lot I to a point which is 50 Feet South of the North line of said Lot I, thence East and parallel with the
North line of Lot I, 140 Feet to the point of beginning.
PARCEL 2: APN: 0134-081-23
All that portion of Lot I, Block 36, City of San Bernardino, in the City of San Bernardino, County of San
Bernardino, State of California, as per map recorded in Book 7, of maps, Page 1, records of said County,
described as follows:
Beginning at the Southwest comer of the East 33.5 feet of the West 83.5 feet of said Lot I; thence East
109 feet along the South line of said lot to a point which is 159 feet East of the Southwest comer of said
lot; thence North 150 feet to the North line of said lot; thence West 109 feet to the Northwest comer of
said East 33.5 feet; thence South to the point of beginning.
Except any portion thereof lying within the following described land:
Beginning at the Northeast comer of said Lot I; thence South 50 feet along "0" Street; thence West 140
feet; thence North to the North line of said lot; thence east to the point of beginning.
PARCEL 3: APN: 0134-081-22
A. That portion of Lot I, Block 36, City of San Bernardino, in the City of San Bernardino, County of
San Bernardino, State of California, as per map recorded in Book 7 of maps, Page I, records of said
County, described as follows:
Commencing at the Northeast comer of said Lot I; thence South on the West line of "0" Street, 50 feet;
thence West 140 feet; thence North 50 feet to the North line of said Lot I; thence East 140 feet to the
point of beginning.
B. That portion of Lot 8, Block 36, City of San Bernardino, in the City of San Bernardino, County of
San Bernardino, State of California, as per map recorded in Book 7, of maps, Page I, records of said
County, described as follows:
Commencing at the intersection of the South line of Church Street and the West line of"O" Street; thence
South 61 feet, more or less, along the West line of"O" Street to the Northeast corner of Lot I, in said
Block 36; thence West 150 feet; Thence North 61 feet, more or less, parallel to the West line of"O"
Street to the South line of Church Street; Thence East along the South line of Church Street, to the point
of beginning.
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EXHIBIT "C"
FORM OF AGENCY QUITCLAIM DEED
RECORDING REQUESTED BY:
When Recorded Mail Document
and Tax Statement To:
SPACE ABOVE THIS LINE FOR RECORDER'S USE
QUITCLAIM DEED
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, the
Redevelopment Agency of the City of San Bernardino, a public body corporate and politic (the
"Grantor") hereby remises, releases and quitclaims to Stan Robbins
(collectively, "Robbins") the following described real property
in the City of San Bernardino, County of San Bernardino, State of California:
See attached Exhibit "A"
This conveyance is further subject to the following community redevelopment covenants:
I. Robbins covenants by and for itself, its heirs, executors, administrators and
assigns, and all persons claiming under or through them, that there will be no
discrimination against or segregation of any person or group of persons on account of
race, color, creed, religion, sex, age, marital status, national origin or ancestry in the sale,
lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, nor will
Robbins or any person claiming under or through it, 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 or on
the Property.
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2. All deeds, leases or contracts made relative to the Property must contain the
following nondiscrimination clauses:
(a) In deeds: "The grantee 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 of race, color, creed, religion, sex, age, marital status,
national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy,
tenure or enjoyment of the land herein conveyed, nor shall the grantee, or any
person claiming under or through the grantee, establish or permit any such
practice or practices of discrimination or segregation with reference to the
selection, locations, number, use or occupancy of tenants, lessees, subtenants,
sub lessees or vendees in or on the land herein conveyed. The foregoing covenants
shall run with the land."
(b) In leases: "The lessee herein covenants by and for itself, its heirs,
executors, administrators and assigns, and all persons claiming under or through
them, and this lease is made and accepted upon and subject to the following
conditions:
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That there shall be no discrimination against or segregation of any person
or group of persons on account of race, color, creed, religion, sex, age, marital
status, national origin or ancestry in the leasing, subleasing, transferring, use,
occupancy, tenure or enjoyment of the land herein leased, nor shall the lessee
itself, or any person claiming under or through it, 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,
sub lessees or vendees in the land herein leased."
(c) In contracts: "There shall be no discrimination against or segregation of
any person or group of persons on account of race, color, creed, religion, sex, age,
marital status, national origin or ancestry in the sale, lease, sublease, transfer, use,
occupancy, tenure or enjoyment of the land, nor shall the transferee itself, or any
person claiming under or through it, 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, sub lessees or vendees of
the land.
3. A breach of any of the covenants, conditions or restrictions herein shall not defeat
nor render invalid the lien or charge of any mortgage or deed of trust made in good faith and for
value covering the Property or any part thereof; however, such covenants, conditions and
restrictions shall be binding upon and effective against any new owner of the Property, or any
portion thereof, whose title thereto is acquired by foreclosure, trustee's sale or otherwise. No
mortgagee shall be subject to any reimbursement obligation which accrues prior to the date such
,- mortgagee takes title to the property.
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4. Robbins covenants for itself, its successors and assigns that, unless otherwise
consented to in writing by the Grantor, in the event the Property, or any portion thereof is used
by an owner that is partially or wholly exempt from the payment of ad valorem property taxes
pertinent to the Property, or portion thereof, and does not make the tax payment for any year
based on that exemption, then in such event the owner of the Property, shall pay the Grantor a
fee in lieu of payment of property taxes each year thereafter in an amount equal to the applicable
percentage of the full cash value as determined in accordance with the State Construction Article
XIIIA and other state law for the Property, or portion thereof which is subject to the exemption,
unless the Grantor consents otherwise in writing. In the event that the in-lieu payment
referenced above is due by the owner for any year, then such amount shall be paid to the Grantor
for the tax year within 90 calendar days following transmittal of notice of invoice by the Grantor
for payment of the in-lieu amount addressed to the owner of the Property as disclosed in the
property tax records of the County of San Bernardino.
5. Robbins acknowledges and agrees for itself, its successors and assigns that the
Property may be used for any lawful purpose so long as such use is in compliance with the
General Plan, the Redevelopment Plan and the Zoning Plan, in existence and as each may be
amended from time to time by the Grantor, the City or other authorized governmental agency.
6. Invalidation of any provision contained herein by judgment of court or otherwise
shall in no way affect any of the other provisions, which shall remain in full force and effect.
7. A breach or a violation by an owner of the Property, or a portion thereof, of a
covenant set forth in this Quitclaim Deed shall not subject such owner's predecessor in interest
in the Property to any liability for such breach or violation. A breach by a tenant on the Property
of Section 1 or Section 2 shall not subject such tenant's landlord to liability for the breach by
such tenant.
Grantor shall have the right to enforce the covenants, conditions and restrictions contained in this
Quitclaim Deed notwithstanding any transfer of the Property or any portion thereof.
IN WITNESS WHEREOF, the Grantor has caused this Quitclaim Deed to be
executed by its authorized officer as of the date indicated next to the signature, below.
Redevelopment Agency of the City of San
Bernardino
Date:
By:
Gary Van Osdel, Executive Director
[NOTARY ACKNOWLEDGMENT
ATTACHED]
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ACCEPTANCE OF QUITCLAIM DEED BY
ROBBIJ\'S
The undersigned hereby acknowledges of the delivery of the subject property from the
Redevelopment Agency of the City of San Bernardino.
ROBBINS
Date:
By:
[NOTARY ACKNOWLEDGMENT
ATTACHED]
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EXHIBIT "D"
FORM OF ROBBINS QUITCLAIM DEED
RECORDING REQUESTED BY:
When Recorded Mail Document
and Tax Statement To:
SPACE ABOVE THIS LINE FOR RECORDER'S USE
QUITCLAIM DEED
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, Stan
Robbins, an individual (the "Grantor") hereby remises, releases and quitclaims to the
Redevelopment Agency of the City of San Bernardino, a body corporate and politic (the
"Agency") the following described real property in the City of San Bernardino, County of San
Bernardino, State of California:
See attached Exhibit "A"
IN WITNESS WHEREOF, the Grantor has caused this Quitclaim Deed to be
executed by its authorized officer as of the date indicated next to the signature, below.
Stan Robbins, an individual
Date:
[NOTARY ACKNOWLEDGMENT
A TT ACHED]
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EXHIBIT "E"
FORM OF PROMISSORY NOTE
SECURED PROMISSORY NOTE
PAYABLE TO A PUBLIC AGENCY
Borrower:
Lender:
Stan Robbins
Redevelopment Agency of the City
of San Bernardino
201 North "E" Street, Suite 301
San Bernardino, California 92401
Principal Amount:
$325,000.00
Date of Promissory Note:
, 2003
Interest Rate: 6%
Maturity Date of Promissory Note:
, 2008
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I. PROMISE TO PAY. Stan Robbins, an individual, or his assigns (collectively, the
"Borrower"), promises to. pay to the Redevelopment Agency of the City of San Bernardino (the
"Agency" or "Holder"), or order, in lawful money of the United States of America, the principal
sum of Three Hundred Twenty-Five Thousand and 00/100 Dollars ($325,000.00), together with
interest on the unpaid outstanding principal balance from time to time as set forth below.
2. INDEBTEDNESS. This Promissory Note evidences the indebtedness of the Borrower to the
Agency under the terms and conditions of that certain Disposition and Development Agreement
dated , 2003 by and between Borrower and the Agency (the "DDA"). This
Promissory Note is referred to in the DDA as the "Note". A copy of the DDA is on file with the
Agency Secretary as a public record of the Agency.
3. INTEREST RATE. Interest shall accrue on the outstanding principal balance of this
Promissory Note commencing on the date of Promissory Note set forth above, at the rate of six
percent (6%) and calculated upon a twenty-five (25) year amortization schedule.
4. PAYMENT. Borrower shall make monthly payments in the amount of Two Thousand Ninety-
Three and 98/1 00 Dollars ($2,093.98) beginning on the first day of the first month after the date
of this Note, a set forth above, to the Agency at its address set forth above or such other address
as later communicated in writing to Borrower by the Agency, in immediately available U.S.
currency. Payments shall be applied first to unpaid fees, costs, and expenses which are
reimbursable under the terms of this Promissory Note or the DDA, then to any late charges, then
to accrued unpaid interest, then to outstanding principal. If any payment due date is a Saturday,
t'~- Sunday, or United States or State of California official holiday, the due date of the payment shall
\..... automatically be extended to the next following business day of the Agency.
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5. FINAL PAYMENT. All accrued and unpaid interest, late payment charges,
outstanding principal, and all other amounts chargeable under this Promissory Note or the
DDA shall be due and payable in full on the Maturity Date.
6. PREP A YMENT. Borrower may pay without penalty all or a portion of the amount owed
under this Promissory Note earlier than it is due.
7. DEFAULT. Borrower will be in default if any of the following happens:
A. Failure of the Borrower to make any payment to the Agency when due under this Promissory
Note.
B. Failure of the Borrower to make a required payment, ifany, to the Agency when due under
the DDA and/or failure of the Borrower to comply with or to perform when due any term,
obligation, covenant or conditions of the DDA after notice from the Agency under any
applicable notice and cure terms of the DDA, if the failure is not cured in accordance with the
cure provisions of the DDA.
C. Failure of the borrower to comply with or to perform when due any other tenn obligation,
covenant or condition contained in this Promissory Note or any other agreement which secures
this Promissory Note, after notice from the Agency, under the applicable notice and cure terms.
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D. Any warranty, representation or statement made or furnished to the Agency by or on behalf of
the Borrower pursuant to the DDA is false or misleading in any material respect at the time made
or furnished.
E. The DDA, this Promissory Note, the Deed of Trust or any other document associated
therewith ceases to be in full force and effect at any time and for any reason (including failure of
any collateral document to create a valid and perfected security interest or lien) due to a default
by the Borrower and failure to cure such default during any applicable cure period and other than
by virtue of the repayment satisfaction and/or mutual release of any such obligation.
F. The dissolution or the termination of the Borrower's existence as a going business of the
insolvency of the borrower, or the appointment of a receiver for any part of the Borrower's
property, any assignment for the benefit of creditors under any type of creditor workout, or the
commencement of any proceeding under any bankruptcy or insolvency laws, unless such
proceedings are discharged or dismissed within ninety (90) days following commencement by or
against the Borrower.
G. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding,
non-judicial foreclosure, self-help, repossession or any other method, by any creditor of the
Borrower or by any governmental agency, against any collateral securing this Promissory Note,
or by any governmental agency, unless such proceedings are discharged or dismissed within
ninety (90) days following commencement. However, this event of default shall not be deemed
r to have occurred if there is a good faith dispute by the Borrower as to the validity or
\..... reasonableness of the claim which is the basis of the creditor or forfeiture proceeding, and if the
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Borrower gives the Agency written notice of the creditor or forfeiture proceeding and furnishes
reserves or a surety bond for the creditor or forfeiture proceeding satisfactory to the Agency and
proceeds to vigorously defend against such a claim.
H. Sale, transfer, hypothecation, assignment, or conveyance of the Agency Property (as defined
in the DDA) or any portion or interest in the Agency Property by the Borrower without the
Agency's prior written consent.
If any default (other than a default described in (A), or (B), above) is curable, and if Borrower
has not been given a notice of a default of the same provision of this Promissory Note within the
preceding twelve (12) months, such a default may be cured (and in such event no default will be
deemed to have occurred) if Borrower, after receiving written notice from the Agency
demanding cure of such default:
(i) cures the default within ten (10) calendar days; or
(ii) if the cure requires more than ten (10) calendar days, immediately
initiates steps which the Agency deems in its sole discretion to be
sufficient to cure the default, and thereafter Borrower continuously
pursues such cure to completion.
8. RIGHTS OF THE HOLDER. Upon default by the Borrower, the Agency may exercise any of
its rights provided under the DDA, including, without limitation, the declaration by the Agency
or the holder in due course of this Promissory Note (individually or collectively the "Holder")
that the entire unpaid principal balance of this Promissory Note and all accrued and unpaid
interest is immediately due and payable, without notice or presentment. Upon the failure of the
Borrower to pay all amounts declared due pursuant to this paragraph entitled "RIGHTS OF THE
HOLDER," including failure to pay at the Maturity Date, the Holder, at its option, may also, if
permitted under applicable law, increase the interest rate on this Promissory Note for interest
which accrues after the date such amount is declared due, to the rate often percent (10%) per
annum. The Holder may hire or pay someone else to help collect this Promissory Note, if the
Borrower does not pay. The Borrower will pay the Holder the amount of any and all such
collection related expenses, including without limitation, subject to any limits under applicable
law, the Holder's reasonable attorneys' fees, whether or not there is a lawsuit, including, without
limitation, reasonable attorneys' fees and legal expenses for bankruptcy proceedings (including
efforts to modify or vacate any automatic stay or injunction), appeals, and any post-judgment
collection services. The Borrower also will pay any court costs, in addition to all other sums
provided by law. This Promissory Note has been delivered to the Holder and accepted by the
Holder in the State of California. If there is a lawsuit arising under this Promissory Note, the
Superior Court of the State of California and for the County of San Bernardino shall have
jurisdiction of such lawsuit. This Promissory Note shall be governed by and construed in
accordance with the laws of the State of California.
9. COLLATERAL. The Borrower acknowledges this Promissory Note is secured by a Deed of
Trust encumbering the Agency Property (as defined in the DDA).
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10. GENERAL PROVISIONS. The Holder may delay or forego enforcing any of its rights or
remedies under this Promissory Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Promissory J\:ote, to the extent allowed by law, each waive any
applicable statute of limitations, presentment, demand for payment, protest and notice of
dishonor. Upon any change in the terms of this Promissory Note, and unless otherwise expressly
stated in writing, no party who signs this Promissory Note, shall be released from liability. All
such parties agree that the Holder may renew or extend (repeatedly and for any length of time)
this Promissory Note, or release any party, or collateral; or impair, fail to realize upon or perfect
the Holder's security interest in any collateral; and take any other action deemed necessary by the
Holder in its sole discretion without the consent of or notice to anyone. All such parties also
agree that the Holder may modify this Promissory Note and/or the DDA without the consent of
or notice to anyone other than the party with whom the modification is made.
All defined words, terms or phrases indicated by initial capital letters used in this Promissory
Kote and not specifically defined in this Promissory Note shall have the meanings ascribed to
such word, term or phrase in the DDA.
PRIOR TO SIGNING THIS PROMISSORY NOTE, BORROWER HAS READ AND
UNDERST ANDS ALL OF ITS PROVISIONS. BORROWER AGREES TO THE TERMS OF
THIS PROMISSORY NOTE AJ\:D ACKNOWLEDGES RECEIPT OF A COPY HEREOF.
BORROWER:
STAN ROBBINS, an individual
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EXHIBIT "F"
FORM OF DEED OF TRUST
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RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Redevelopment Agency for the
City San Bernardino
Attention: Executive Director
201 North "E" Street, Suite 301
San Bernardino, California 92401
DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS,
FIXTURE FILING AND SECURITY AGREEMENT
THE DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, FIXTURE
FILING AND SECURITY AGREEMENT ("Deed ofTrust") is made as of , 2003,
by the Stan Robbins (collectively, the "Trustor"), whose
address is , to Lawyers Title Company ("Trustee"),
whose address is , San Bernardino, California 92408, for the benefit
of the Redevelopment Agency for the City of San Bernardino, a public body corporate and
politic, its successors and assigns ("Beneficiary"), whose address is 201 North "E" Street, Suite
301, San Bernardino, California 92401.
WITNESSETH
That Trustor, for valuable consideration, grants, bargains, sells, conveys and warrants to
Trustee, in trust with power of sale, that property in the City of San Bernardino, County of San
Bernardino, State of California, more particularly described in Exhibit :'A" attached hereto and
made a part hereof (the "Land"), together with the following described estate, property and rights
of Trustor in the Land and/or in any improvements now or hereafter constructed thereon
(severally and collectively, the "Property") as security for the performance of each covenant and
agreement of Trustor contained herein and in all other instruments executed in connection
herewith, and for the payment of all sums of money secured hereby.
A. All the fee and leasehold estates and rights of Trustor now held and hereafter
acquired in and to the Property and in and to land lying in streets and roads adjoining the
Property, and all access rights and easements appertaining thereto; and
B. All buildings, structures, improvements, furnishings, fixtures and equipment, real,
personal and mixed, now or hereafter attached to, or used or adapted for use in the operation of
the Property and any and all replacements and additions thereto, including without limitation, all
heating apparatus and equipment whatsoever, all boilers, engines, motors, dynamos, generating
equipment, pumps, piping and plumbing fixtures, cooling, ventilating, sprinkling, fire-
extinguishing apparatus, gas and electric fixtures, elevators, escalators, partitions, and shrubbery
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and plants; and including also all interest of any owner of the Property in any of such items
hereafter at any time acquired under conditional sales contract, chattel mortgage or other title-
retaining or security instrument, all of which property mentioned in this paragraph shall be
deemed part of the realty and not severable wholly or in part without material injury to the
freehold; and
C. All and singular the lands, tenements, privileges, water, water rights, water stock,
mineral, oil and gas rights, hereditaments and appurtenances thereto belonging or in anywise
appertaining, and the reversion and reversions, remainder and remainders, rents, royalties, issues
and profits thereof, and all the estate, rights, title, claim, interest and demand whatsoever of the
Trustor either in law or equity, of, in and to the Property, whether now held or hereafter
acquired;
D. All of the right, title and interest of Trustor now or hereafter existing in and to the
following now or hereafter located in, upon, within or about or used in connection with the
construction, use, operation or occupancy of the Property and/or the improvements thereon and
any business or activity conducted thereon or therein, together with all accessories, additions,
accessions, renewals, replacements and substitutions thereto or therefor and the proceeds and
products thereof: (i) all materials, supplies, furniture, furnishings, appliances, office supplies,
equipment, construction materials, vehicles, machinery, computer hardware and software,
maintenance equipment, window washing equipment, repair equipment and other equipment and
tools, telephone and other communications equipment; (ii) all books, ledgers, records,
accounting records, files, tax records and returns, policy manuals, papers, correspondence, and
electronically recorded data; (iii) all "General Intangibles" (as such term is defined in the
California Commercial Code), instruments, money, "Accounts," (as such term is defined in the
California Commercial Code), accounts receivable, notes, certificates of deposit, chattel paper,
letters of credit, choses in action, good will, rights to payment of money, rents, rental fees,
equipment fees and other amounts payable by persons who utilize the Property or any of the
improvements or paid by persons in order to obtain the right to use the Property and any of the
improvements, whether or not so used; trademarks, service marks, trade dress, tradenames,
licenses, sales contracts, deposits, plans and specifications, drawings, working drawings, studies,
maps, surveys; soils, environmental, engineering or other reports, architectural and engineering
contracts, construction contracts, construction management contracts, surety bonds, feasibility
and market studies, management and operating agreements, service agreements and contracts,
landscape maintenance agreements, security service and other services agreements and vendors
agreements; (iv) all compensation, awards and other payments or relief (and claims therefor)
made for a taking by eminent domain, or by any event in lieu thereof (including, without
limitation, property and rights and interests in property received in lieu of any such taking), of all
or any part of the Property (including without limitation, awards for severance damages),
together with interest thereon, and any and all proceeds (or claims for proceeds) of casualty,
liability or other insurance pertaining to the Property, together with interest thereon; (v) any and
.all claims or demands against any person with respect to damage or diminution in value to the
Property or damage or diminution in value to any business or other activity conducted on the
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Property; (vi) any and all security deposits, deposits of security or advance payments made to
others with respect to: (I) insurance policies relating to the Property; (2) taxes or assessments of
any kind or nature affecting the Property; (3) utility services for the Property and/or the
improvements; (4) maintenance, repair or similar services for the Property or any other services
or goods to be used in any business or other activity conducted on the Property; (vii) any and all
authorizations, consents, licenses, permits and approvals of and from all persons required from
time to time in connection with the construction, use, occupancy or operation of the Property, the
improvements, or any business or activity conducted thereon or therein or in connection with the
operation, occupancy or use thereof, (viii) all warranties, guaranties, utility or street
improvement bonds, utility contracts, telephone exchange numbers, yellow page or other
directory advertising and the like; (ix) all goods, contract rights, and inventory; (x) all leases and
use agreements of machinery, equipment and other personal property; (xi) all insurance policies
covering all or any portion of the Property; (xii) all reserves (including those provided for in
Section 17 hereof) and funds held in escrow by Beneficiary or other person for Beneficiary*s
benefit and any funds deposited with Beneficiary, all accounts into which such funds are
deposited and all accounts, contract rights and general intangibles or other rights relating thereto;
(xiii) all names by which the Property is now or hereafter known; (xiv) all interests in the
security deposits of tenants; (xv) all management agreements, blueprints, plans, maps,
documents, books and records relating to the Property; (xvi) the proceeds from sale, assignment,
conveyance or transfer of all or, any portion of the Property or any interest therein, or from the
sale of any goods, inventory or services from, upon or within the Property and/or the
improvements (but nothing contained herein shall be deemed a consent by Beneficiary to such
sale, assignment, conveyance or transfer, except as expressly provided in this Deed of Trust);
(xvii) any property described in paragraph B, above, which are not fixtures under California law;
(xviii) all other property (other than fixtures) of any kind or character as defined in or subject to
the provisions of the California Uniform Commercial Code, Secured Transactions, as amended
and; (xix) all proceeds of the conversions, voluntarily or involuntarily, of any of the foregoing
into cash or liquidated claims.
TO HAVE AND TO HOLD the Property, together with all and singular the lands,
tenements, privileges, water, water rights, water stock, mineral, oil and gas rights, hereditaments
and appurtenances thereto belonging or in any wise appertaining, and the reversion and
reversions, remainder and remainders, rents, royalties, issues and profits thereof, and all of the
estate, right, title, claims and demands whatsoever of the Trustor, either in law or in equity, of, in
and to the Property, forever as security for the faithful performance of the Obligations (as
defined below) secured hereby and as security for the faithful performance of each and all of the
covenants, agreements, terms and conditions of this Deed of Trust, and in all other instruments
executed in connection herewith, SUBJECT, HOWEVER, to the right, power and authority
given to and conferred upon Beneficiary to collect and apply such rents, issues and profits. This
Deed of Trust also constitutes a security agreement in all of the property above described or
referenced in which such interest may be created under the California Commercial Code and for
such purposes Trustor hereby grants to Beneficiary a security interest therein.
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1. Agency Loan Secured. This Deed of Trust is made for the purpose of securing (i)
the prompt payment of the Note (as defined below), together with all interest, premiums and
other amounts, if any, due in accordance with the terms of the Note and that certain Disposition
and Development Agreement by and between the Redevelopment Agency for the City of San
Bernardino and Stan Robbins, dated as of (the "Disposition and Development
Agreement"), and all references therein, regarding the purchase, lease, sale, or financing of the
Property and the payment of the principal sum of THREE HUNDRED TWENTY FIVE
THOUSAND 001100 DOLLARS ($325,000.00) (the "Loan") as evidenced by that certain
Secured Promissory Note of even date herewith (which note, together with all notes issued in
substitution or exchange therefore and all amendments thereto, is referred to as the "Note") for
Trustor's acquisition of the Property and all other instruments or agreements executed in
connection therewith, and all interest thereon and other amounts evidenced thereby; all future
advances made to Trustor by Beneficiary, its successors and assigns, under the Disposition and
Development Agreement or pursuant to the terms of this Deed of Trust or any other instruments
or agreements executed in connection with or to secure the covenants of the Trustor set forth in
the Disposition and Development Agreement (collectively, the "Transaction Documents"); (ii)
the prompt performance of each and every covenant, condition, and agreement contained in the
Transaction Documents; (iii) the payment of any and all other debts, claims, obligations,
demands, monies, liabilities and indebtedness of any kind or nature now or hereafter owing,
arising, due or payable from Trustor to Beneficiary, when the document evidencing the same
specifically refers to this Deed of Trust and that it is intended to be secured hereby; and (iv) the
obligations evidenced by all renewals, extensions, modifications, substitutions and conditions of
any of the Transaction Documents; and any and all other obligations of Trustor to Beneficiary,
its successors and assigns, now existing and hereafter arising and which are at any time
specifically declared by Beneficiary in writing to be secured by this Deed of Trust or which
specifically indicate in the instruments which evidence the same that they are intended to be so
secured. All obligations of Trustor to Beneficiary pursuant to the Transaction Documents are
sometimes collectively referred to as the "Obligations".
2. Trustor's Covenant of Payment. Trustor shall perform all of its obligations under
the Transaction Documents and under this Deed of Trust when due, without excuse or delay of
any kind whatsoever, except as expressly provided herein or therein, and Trustor shall pay the
Loan, and all other debts and monies secured by this Deed of Trust when due without set off or
deduction of any kind.
3. Trustor's Warranties of Title. Trustor warrants to Beneficiary that it is the sole
holder of fee simple absolute title to all of the Property and that said title is marketable and free
from any lien or encumbrance, except as otherwise provided in this section, or approved in
writing by Beneficiary, and the liens imposed by law for nondelinquent real property taxes and
assessments. Trustor further covenants and agrees as follows: that Trustor will keep the Property
free from all liens of any kind, including, without limitation, statutory and governmental liens;
that no lien superior or junior to this Deed of Trust will be created or suffered to be created by
Trustor during the life of this Deed of Trust without Beneficiary's prior written consent; that
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Trustor has good right to make this Deed of Trust and the person or persons executing this Deed
of Trust on behalf of Trustor has or have the authority to do so; and that Trustor will forever
warrant and defend Beneficiary's interest in the Property against every person, whomsoever,
claiming any right or interest in the Property or any part thereof.
4. Trustor's Right to Contest Statutory Liens. As used herein the words "mechanic's
lien" and "materialmen's lien" mean and include a "stop notice" as this term is defined in
California Civil Code Sections 3179, et seq. The filing ofa mechanic's or materialmen's lien
against the Property or a stop notice against the Trustor or the Beneficiary and/or funds held by
or owed to the Trustor for an improvement of the Property shall not constitute a default
hereunder, if and so long as (a) no defaults exist under the Disposition and Development
Agreement, this Deed of Trust, or any of the other Transaction Documents; (b) within fifteen
(15) days after filing of such lien, Trustor obtains and maintains in effect a bond issued by a
California admitted surety acceptable to Beneficiary in an amount not less than 125% of the
entire sum alleged to be owed to the lien claimant or such other amount as is required to obtain a
court order to release said lien of record; (c) Trustor provides to Beneficiary and pays for an
endorsement to Beneficiary's title insurance policy, in a form satisfactory to Beneficiary, which
insures the priority of this Deed of Trust over the lien being contested; (d) Trustor immediately
commences its contest of such lien and continuously pursues the same in good faith and with due
diligence; (e) such bond or contest stays the foreclosure of the lien; and (f) Trustor pays in full
any judgment rendered for the lien claimant within ten (10) days following entry of any such
judgment.
5. Maintenance and Inspection of Improvements. Trustor shall maintain the
buildings and other improvements now or hereafter located on the Property in good condition
and state of repair. Trustor shall not commit or suffer any waste on the Property, shall promptly
comply with all requirements of federal, state and municipal authorities and all other laws,
ordinances, regulations, covenants, conditions and restrictions respecting the Property or the use
thereof, and shall pay all fees or charges of any kind in connection therewith.
6. Construction and Repairs. This Deed of Trust is given to secure an obligation
for the repayment of the Loan for the purchase of the Property and, without limiting the
application of any provision of the Disposition and Development Agreement or any other
Transaction Document, Trustor therefore further agrees:
To allow Beneficiary to inspect said Property at all reasonable times.
Trustor shall complete or restore promptly and in a good and workmanlike manner any
building or improvement that may be constructed, damaged or destroyed on the Property, and
pay when due all costs incurred therefor.
7. Alterations. No building or other improvement on the Property shall be
structurally altered, removed or demolished without the Beneficiary's prior written consent, nor
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shall any fixture or chattel covered by this Deed of Trust and adapted to the proper use and
enjoyment of the Property be removed at any time without Beneficiary's prior written consent,
unless actually replaced by an article of equal suitability and value, owned by the Trustor, free
and clear of any lien or security interest, except such as may be approved in writing by the
Beneficiary.
8. Compliance With Laws. Trustor shall comply with all statutes, laws, ordinances
and regulations which now or hereafter pertain to the construction, repair, condition, use and
occupancy of the Property, including, without limitation, all environmental, subdivision, zoning,
building code, fire, occupational, health, safety, occupancy and other similar or dissimilar
statutes, and shall not permit any tenant or other occupant of any portion of the Property to
violate the same. If any statute or order of any court of competent jurisdiction requires any
correction, alteration or retrofitting of any improvements on or related to the Property, Trustor
shall promptly undertake the required repairs and restoration and complete the same with due
diligence at its sole cost and expense.
9. Environmental Covenants, Representations, Warranties and Indemnitv.
(a) Trustor will not use any Hazardous Materials (as defined herein below) in
the construction of the Project or other improvements on or about the Property.
(b) Trustor shall, at its sole expense, comply and cause each tenant occupying
or leasing space within the Property to comply with all applicable laws, regulations, codes and
ordinances relating to any Hazardous Materials or to any Environmental Activities (as defined
herein below), including, without limitation, obtaining, filing, serving or posting all applicable
notices, permits, licenses and similar authorizations. Trustor shall establish and maintain a
management and operating policy for the Property to assure and monitor continued compliance
by Trustor and each tenant occupying or leasing space in the Property with all such laws,
regulations, codes and ordinances.
(c) Trustor agrees to submit from time to time, if requested by Beneficiary, a
report, satisfactory to Beneficiary, certifying that the Property is not now being used nor has it
ever been used for any Environmental Activities. Beneficiary reserves the right, in its reasonable
discretion, to retain, at Trustor's expense, an independent professional consultant to review any
report prepared by Trustor and/or to conduct its own investigation of the Property for Hazardous
Materials. Trustor hereby grants to Beneficiary, its agents, employees, consultants and
contractors the right to enter upon the Property to perform such tests as are reasonably necessary
to conduct such a review and/or investigation.
(d) Upon the discovery by Trustor of any event or situation which would
render any of the representations or warranties contained in subparagraph 9(h) hereof inaccurate
in any respect, if made at the time of such discovery, Trustor shall promptly notify Beneficiary of
such event or situation and, within thirty (30) days after such discovery, submit to Beneficiary a
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preliminary written environmental plan setting forth a general description of such event or
situation and the action that Trustor proposes to take with respect thereto. Within sixty (60) days
after such discovery, Trustor shall submit to Beneficiary a final written environmental report,
setting forth a detailed description of such event or situation and the action that Trustor proposes
to take with respect thereto, including, without limitation, any proposed corrective work, the
estimated cost and time of completion, the name of the contractor and a copy of the construction
contract, if any, and such additional data, instruments, documents, agreements or other materials
or information as Beneficiary may reasonably request. The plan shall be subject to Beneficiary's
prior written approval, which approval may be granted or withheld in Beneficiary's sole but
reasonable discretion. Beneficiary shall notify Trustor in writing of its approval or disapproval of
the final plan within fifteen (IS) days after receipt thereof by Beneficiary. If Beneficiary
disapproves the plan, Beneficiary's notice to Trustor of such disapproval shall include a brief
explanation of the reasons therefor. Trustor shall submit to Beneficiary a revised final written
environmental plan that remedies the defects identified by Beneficiary as reasons for
Beneficiary's disapproval of the previous plan. If Trustor fails to submit a revised plan to
Beneficiary within said thirty (30) day period, or if such revised plan is submitted to Beneficiary
and Beneficiary disapproves said plan, such failure or disapproval shall, at Beneficiary's option
and upon notice to Trustor, constitute an "Event of Default" hereunder. If Beneficiary does not
notify Trustor of its approval or disapproval of the final plan or any revisions thereof within the
fifteen (15) day period described above, Trustor shall provide written notice to Beneficiary of
Beneficiary's failure to respond, at which time Beneficiary shall have an additional forty-five
(45) days after receipt of such notice from Trustor to notify Trustor of its approval or disapproval
of the final plan within said additional forty-five (45) day period. If Beneficiary fails to notify
Trustor of its disapproval or approval of said plan within said forty-five (45) day period the plan
shall be deemed approved. Once any such plan is approved in writing or deemed approved by
Beneficiary, Trustor shall promptly commence all action necessary to implement such plan and
to comply with any requirements or conditions imposed by Beneficiary, and shall diligently and
continuously pursue such action to completion in strict accordance with the terms of said plan.
The rights of Beneficiary with respect to the approval or disapproval of the environmental plan
set forth herein and the actions of Beneficiary pursuant to such rights are not intended to, and
shall not, in and of themselves, confer on Beneficiary a right to manage, operate or control the
Property on a continuing basis following the discovery of the event(s) or occurrence(s) described
in this subparagraph 9( d).
(e) Trustor agrees to submit from time to time, if requested by Beneficiary, a
report, satisfactory to Beneficiary, specifying any activities involving, directly or indirectly, the
use, generation, treatment, storage or disposal of any Hazardous Materials on the Property.
Beneficiary reserves the right, in its sole and reasonable discretion, to retain, at Trustor's
expense, an independent professional consultant to review any report prepared by Trustor and/or
to conduct its own investigation of the Property. Trustor hereby grants to Beneficiary, its agent,
employees, consultants and contractors the right to enter upon the Property and to perform such
tests as Beneficiary deems are necessary to conduct such a review and/or investigation.
Beneficiary shall hold in confidence any report delivered by Trustor to Beneficiary pursuant to
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this Section 9, except for disclosure to (a) any consultant(s) hired by Beneficiary to review said
report, (b) legal counsel, accountants and other professional advisors to Beneficiary, (c)
regulatory officials having jurisdiction over Beneficiary who may request said report, (d) as
required by any federal, state, county, regional or local authority or law, rule, regulation or
ordinance, (e) as required in connection with any legal proceeding, and (I) any financial
institution in connection with a disposition or proposed disposition of all or part of Beneficiary's
or any participant's interests hereunder.
"Hazardous Materials" as used in this Deed of Trust shall mean any hazardous or
toxic materials, pollutants, effluents, contaminants, radioactive materials, flammable explosives,
chemicals known to cause cancer or reproductive toxicity, emissions or wastes and any other
chemical, material or substance, the handling, storage, release, transportation, or disposal of
which is or becomes prohibited, limited or regulated by any federal, state, county, regional or
local authority or which, even if not so regulated, is or becomes known to pose a hazard to the
health and safety of the occupants of the Property including, without limitation, (i) asbestos, (ii)
petroleum and petroleum by-products, (iii) urea formaldehyde foam insulation, (iv)
polychlorinated biphenyls, (v) all substances now or hereafter designated as "hazardous
substances," "hazardous materials" or "toxic substances" pursuant to the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), 42 U.S.c.
Section 9601 et seq., as amended by the Superfund Amendments and Reauthorization Act of
1986 ("SARA"), the Federal Water Pollution Control Act, 33 U.S.c. Section 1251 et seq. the
Clean Air Act, 42 U.S.c. Section 7401 et seq., the Hazardous Materials Transportation Act, 49
U.S.c. Section 1801 et seq., or the Resource, Conservation and Recovery Act, 42 U.S.C. Section
6901 et seq.; (vi) all substances now or hereafter designated as "hazardous wastes" in Section
25117 of the California Health & Safety Code or as "hazardous substances" in Section 253 16 of
the California Health & Safety Code; (vii) all substances now or hereafter designated by the
Governor of the State of California pursuant to the Safe Drinking Water and Toxic Enforcement
Act of 1986 as being known to cause cancer or reproductive toxicity, or (viii) all substances now
or hereafter designated as "hazardous substances," "hazardous materials" or "toxic substances"
under any other federal, state or local laws or in any regulations adopted and publications
promulgated pursuant to said laws.
"Environmental Laws" as used herein shall mean all laws, rules, regulations and
ordinances relating to Hazardous Materials, including, but not limited to, those relating to soil
and groundwater conditions and those statutes referred to in the definition of Hazardous
Materials set forth hereinabove.
"Environmental Activities" as used herein shall mean the use, generation,
transportation, treatment, storage or disposal of any Hazardous Materials at any time located on
or present on, under or about the Property.
(I) Trustor hereby agrees, at its sole cost and expense, to indemnify, protect,
hold harmless and defend (with counsel of Beneficiary*s choice), Beneficiary, its successors and
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assignees, and the officials, officers, agents, attorneys and employees of each of them
(individually, each an "Indemnitee", and collectively, the "Indemnitees") from and against any
and all claims, demands, damages, losses, liabilities, obligations, penalties, fines, actions, causes
of action, judgments, suits, proceedings, costs, disbursements and expenses (including, without
limitation, attorneys' and experts' reasonable fees, disbursements and costs) of any kind or of
any nature whatsoever (collectively, "Claims") which may at any time be imposed upon,
incurred or suffered by, or asserted or awarded against, any Indemnitee directly or indirectly
relating to or arising from any of the following "Environmental Matters," but excluding any
Claims arising solely from the gross negligence or willful misconduct of Beneficiary:
(i) Any past, present or future presence of any Hazardous Materials
on, in, under or affecting all or any portion of the Property or on, in, under or affecting all
or any portion of any property adjacent or proximate to the Property, if such Hazardous
Materials originated or allegedly originated on or from the Property;
(ii) Any past, present or future storage, holding, handling, release,
threatened release, discharge, generation, leak, abatement, removal or transportation of
any Hazardous Materials on, in, under or from the Property or any portion thereof,
(iii) The failure of Trustor to comply with any and all laws, rules,
regulations, judgments, orders, permits, licenses, agreements, covenants, restrictions,
requirements or the like now or hereafter relating to or governing in any way the
environmental condition of the Property or the presence of Hazardous Materials on, in,
under or affecting all or any portion of the Property including, without limitation, all
Environmental Laws;
(iv) The failure of Trustor to properly complete, obtain, submit and/or
file any and all notices, permits, licenses, authorizations, covenants, and the like relative
to any of the Environmental Matters described herein in connection with the Property or
the ownership, use, operation or enjoyment thereof,
(v) The extraction, removal, containment, transportation or disposal
of any and all Hazardous Materials from any portion of the Property or any other
property adjacent or proximate to the Property, if such Hazardous Materials originated or
allegedly originated on or from the Property;
(vi) Any past, present or future presence, permitting, operation,
closure, abandonment or removal from the Property of any storage tank that at any time
contains or contained any Hazardous Materials and is or was located on, in or under the
Property or any portion thereof;
(vii) The implementation and enforcement of any monitoring,
notification or other precautionary measures that may at any time become necessary to
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protect against the release or discharge of Hazardous Materials on, in, under or affecting
the Property or into the air, any body of water, any other public domain or any property
adjacent or proximate to the Property;
(viii) Any failure of any Hazardous Materials generated or moved from
the Property to be removed, contained, transported or disposed of in compliance with all
applicable Environmental Laws; or
(ix) Any breach by Trustor of any of its covenants, representations or
warranties regarding Environmental Matters contained in this Deed of Trust or any of the
other Transaction Documents.
(g) Trustor hereby represents and warrants as follows:
(i) The Property is not and has not been a si te for the use, generation,
manufacture, storage, treatment, release, threatened release, discharge, disposal, or
transportation of any Hazardous Materials;
(ii) The Property is in compliance with all Environmental Laws;
(iii) Trustor has not received any written notice of claims or actions
(collectively, "Hazardous Materials Claims") pending or threatened against Trustor or
any previous owner or user of the Property (and relating to Trustor's and/or such previous
owner's or user's ownership of the Property), by any governmental entity or agency or
any other person or entity and relating to Hazardous Materials or pursuant to
Environmental Laws; and
(iv) Trustor has not received any written notice (i) pursuant to which the
Property has been designated as "border zone property" under the provisions of
California Health and Safety Code Sections 25220 et seq., or any regulation adopted in
accordance therewith, (ii) of a hearing at which the Property will be considered for
designation as "border zone property," or (iii) of an occurrence or condition on any real
property adjoining or in the vicinity of the Property that could cause the Property or any
part thereof to be designated as "border zone property."
The foregoing shall constitute environmental prOVISIons for purposes of
California Code of Civil Procedure Section 736.
10. Insurance
10.1. Casualtv Insurance. Trustor shall at all times keep the Property insured
for the benefit of Trustee and Beneficiary as follows, despite governmental requirements that
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may detrimentally affect Trustor's ability to obtain or may materially increase the cost of such
insurance coverage:
10.1.1. Against damage or loss by fire and such other hazards (including
lightning, windstonn, hail, explosion, riot, acts of striking employees, civil commotion,
vandalism, malicious mischief, aircraft, vehicle, and smoke) as are covered by the broadest fonn
of extended coverage endorsement available from time to time, in an amount not less than the
full insurable value (as defined in section 10.9) of the Property, with a deductible amount not to
exceed an amount satisfactory to Beneficiary;
10.1.2. Against rent, business, use or occupancy interruption on such basis
and in such amounts and with such deductibles as are satisfactory to Beneficiary;
10.1.3. Against damage or loss by flood, if the Property is located in an
area identified by the Secretary of Housing and Urban Development or any successor or other
appropriate authority (governmental or private) as an area having special flood hazards and in
which flood insurance is available under the National Flood Insurance Act of 1968 or the Flood
Disaster Protection Act of 1973, as amended, modified, supplemented, or replaced from time to
time, on such basis and in such amounts as Beneficiary may require;
10.1.4. Against damage or loss from (a) sprinkler system leakage and (b)
boilers, boiler tanks, heating and air conditioning equipment, pressure vessels, auxiliary piping,
and similar apparatus, on such basis and in such amounts as Beneficiary may require;
10.1.5. During any alteration, construction, or replacement of
improvements on the Property, or any substantial portion thereof, a Builder's All Risk policy
with extended coverage with course of construction and completed value endorsements, for an
amount at least equal to the full insurable value of the improvements on the Property, and
workers' compensation, in statutory amounts, with provision for replacement with the coverage
described in Section 10.1, without gaps or lapsed coverage, for any completed portion of
improvements on the Property; and
10.1.6. Against damage or loss by earthquake, in an amount and with a
deductible satisfactory to Beneficiary, if such insurance is required by Beneficiary in the exercise
of its business judgment in light of the commercial real estate practices existing at the time the
insurance is issued and in the County where the Property is located.
10.2. Liabilitv Insurance. Trustor shall procure and maintain workers'
compensation insurance for Trustor's employees and comprehensive general liability insurance
covering Trustor, Trustee, and Beneficiary against claims for bodily injury or death or for
damage occurring in, on, about, or resulting from the Property, or any street, drive, sidewalk,
curb, or passageway adjacent to it, in standard fonn and with such insurance company or
companies and in an amount of at least $3,000,000 combined single limit, or such greater
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amount, as Beneficiary may require, which insurance shall include completed operations,
product liability, and blanket contractual liability coverage that insures contractual liability under
the indemnifications set forth in this Deed of Trust and the Transaction Documents (but such
coverage or its amount shall in no way limit such indemnification).
10.3. Other Insurance. Trustor shall procure and maintain such other insurance
or such additional amounts of insurance, covering Trustor and the Property, as (a) may be
required by the terms of any construction contract for any improvements on the Property or by
any governmental authority, other than Beneficiary, (b) may be specified in any other
Transaction Documents, or (c) may be reasonably required by Beneficiary from time to time.
10.4. Form of Policies. All insurance required under this Section 10 shall be
fully paid for and nonassessable. The policies shall contain such provisions, endorsements, and
expiration dates as Beneficiary from time to time reasonably requests and shall be in such form
and amounts, and be issued by such insurance companies doing business in the State of
California, as Beneficiary shall approve in Beneficiary's sole and absolute discretion. Unless
otherwise expressly approved in writing by Beneficiary, each insurer shall have a Best Rating of
Class A, Category VIII, or better. All policies shall (a) contain a waiver of subrogation
endorsement; (b) provide that the policy will not lapse or be canceled, amended, or materially
altered (including by reduction in the scope or limits of coverage) without at least 30 days' prior
written notice to Beneficiary; (c) with the exception of the comprehensive general liability
policy, contain a mortgagee's endorsement (438 BFU Endorsement or equivalent), and name
Beneficiary and Trustee as insureds; and (d) include such deductibles as Beneficiary may
approve. If a policy required under this paragraph contains a co-insurance or overage clause, the
policy shall include a stipulated value or agreed amount endorsement acceptable to Beneficiary.
10.5. Duplicate Originals or Certificates. Duplicate original policies evidencing
the insurance required under this Section 10 and any additional insurance that may be purchased
on the Property by or on behalf of Trustor shall be deposited with and held by Beneficiary and,
in addition, Trustor shall deliver to Beneficiary (a) receipts evidencing payment of all premiums
on the policies and (b) duplicate original renewal policies or a binder with evidence satisfactory
to Beneficiary of payment of all premiums at least 30 days before the policy expires. In lieu of
the duplicate original policies to be delivered to Beneficiary under this Section 10.5, Trustor may
deliver an underlier of any blanket policy, and Trustor may also deliver original certificates from
the issuing insurance company, evidencing that such policies are in full force and effect and
containing information that, in Beneficiary's reasonable judgment, is sufficient to allow
Beneficiary to ascertain whether such policies comply with the requirements of this Section 10.
10.6. Increased Coverage. If Beneficiary determines that the limits of any
insurance carried by Trustor are inadequate or that additional coverage is required, Trustor shall,
within 10 days after written notice from Beneficiary, procure such additional coverage as
Beneficiary may require in Beneficiary's sole and absolute discretion.
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10.7. No Separate Insurance. Trustor shall not carry separate or additional
insurance concurrent in form or contributing in the event of loss with that required under this
Section 10, unless endorsed in favor of Trustee and Beneficiary, as required by this Section 10
and otherwise approved by Beneficiary in all respects.
10.8. Transfer of Title. In the event of foreclosure of this Deed of Trust or other
transfer of title or assignment of the Property in extinguishment, in whole or in part, of the Loan,
all right, title, and interest of Trustor in and to all insurance policies required under this Section
10 or otherwise then in force with respect to the Property and all proceeds payable under, and
unearned premiums on, such policies shall immediately vest in the purchaser or other transferee
of the Property.
10.9. Replacement Cost. For purposes of this Section 10, the term "full
insurable value" means the actual cost of replacing the Property in question, without allowing for
depreciation, as calculated from time to time (but not more often than once every calendar year)
by the insurance company or companies holding such insurance or, at Beneficiary's request, by
appraisal made by an appraiser, engineer, architect, or contractor proposed by Trustor and
approved by said insurance company or companies and Beneficiary. Trustor shall pay the cost of
such appraisal.
10.10. Approval Not Warrantv. No approval by Beneficiary of any insurer may
be construed to be a representation, certification, or warranty of its solvency and no approval by
Beneficiary as to the amount, type, or form of any insurance may be construed to be a
representation, certification, or warranty of its sufficiency.
10.11. Beneficiary's Right To Obtain. Trustor shall deliver to Beneficiary
original policies or certificates evidencing such insurance at least 30 days before the existing
policies expire. If any such policy is not so delivered to Beneficiary or if any such policy is
canceled, whether or not Beneficiary has the policy in its possession, and no reinstatement or
replacement policy is received before termination of insurance, Beneficiary, without notice to or
demand on Trustor, may (but is not obligated to) obtain such insurance insuring only Beneficiary
and Trustee with such company as Beneficiary may deem satisfactory, and pay the premium for
such policies, and the amount of any premium so paid shall be charged to and promptly paid by
Trustor or, at Beneficiary's option, may be added to the Loan. Trustor acknowledges that, if
Beneficiary obtains insurance, it is for the sole benefit of Beneficiary and Trustee, and Trustor
shall not rely on any insurance obtained by Beneficiary to protect Trustor in any way.
10.12. Dutv To Restore After Casual tv. If any act or occurrence of any kind or
nature (including any casualty for which insurance was not obtained or obtainable) results in
damage to or loss or destruction of the Property, Trustor shall immediately give notice of such
loss or damage to Beneficiary and, if Beneficiary so instructs, shall promptly, at Trustor's sole
cost and expense, regardless of whether any insurance proceeds will be sufficient for the
purpose, commence and continue diligently to completion to restore, repair, replace, and rebuild
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the Property as nearly as possible to its value, condition, and character immediately before the
damage, loss or destruction.
II. Assignment of Insurance and Condemnation Proceeds. Should the Property or
any part or appurtenance thereof or right or interest therein be taken or damaged by reason of any
public or private improvement, condemnation proceeding (including change of grade), fire,
earthquake or other casualty, or in any other manner, Beneficiary or Trustee may, at its option,
commence, appear in and prosecute, in its own name, any action or proceeding, or make any
reasonable compromise or settlement in connection with such taking or damage, and obtain all
compensation, awards or other relief therefor. All compensation, awards, damages, rights of
action and proceeds, including the policies and the proceeds of any policies of insurance
affecting the Property, are hereby assigned to Beneficiary, but no such assignments shall be
effective to invalidate or impair any insurance policy. Trustor further assigns to Beneficiary any
return premiums or other repayments upon any insurance at any time provided for the benefit of
the Beneficiary and all refunds or rebates made of taxes or assessments on the Property, and
Beneficiary may at any time collect said return premiums, repayments, refunds and rebates in the
event of any default by Trustor under the Disposition and Development Agreement, the Note or,
this Deed of Trust or any other Transaction Documents. No insurance proceeds or condemnation
awards at any time assigned to or held by Beneficiary shall be deemed to be held in trust and
Beneficiary may commingle such proceeds with its general assets and shall not be liable for the
payment of any interest thereon. Trustor also agrees to execute such further assignments of any
such policies, compensation, award, damages, rebates, return of premiums, repayments, rights of
action and proceeds as Beneficiary or Trustee may require.
12. Use of Insurance Proceeds. After any damage by casualty to the Property, whether
or not required to be insured against under the policies to be provided by Trustor, Trustor shall
give prompt written notice thereof to Beneficiary generally describing the nature and cause of
such casualty and the extent of the damage to or destruction of the Property. Trustor shall have
the obligation to promptly repair the damage, regardless of whether and to the extent the casualty
was covered by an insurance policy. For these purposes, Beneficiary shall make available to
Trustor proceeds of any insurance policy covering the casualty and maintained by Trustor under
and subject to each of the following terms and conditions:
(a)
the "Proceeds") shall
following conditions:
Insurance proceeds which are directly attributable to the damage (herein
be released to Trustor upon and subject to satisfaction of each of the
(i) There exists no default under the Disposition and Development
Agreement, this Deed of Trust or any other Transaction Documents at any time
prior to or during the course of reconstruction;
(ii) Receipt by Beneficiary of satisfactory written evidence that any
proposed restorations by Trustor will comply with all statutes, ordinances,
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regulations, rules, rulings, restrictive covenants, reciprocal easements, leases and
contracts; that all proposed plans and specifications are approved by all required
governmental agencies; and that Trustor has obtained all necessary building and
other permits and approvals for such reconstruction;
(iii) Receipt by Beneficiary of proof reasonably satisfactory to
Beneficiary that there exists and will continue to exist, until the Property is
reasonably expected to be restored and fully occupied, a source of funds sufficient
to pay the Loan as and when due. Such computation shall include Beneficiary's
estimate of the amount necessary to pay all of the sums due on the Note over the
projected period of reconstruction, and Beneficiary may require Trustor to
establish and fund a holdback account up to the amount of the difference between
the anticipated debt service and operating expenses of Trustor. In the event of any
default under the Note, this Deed of Trust, any other Transaction Documents or
any reconstruction requirements, Beneficiary may, at its option, apply any portion
or all of such amounts against accrued interest and the outstanding amounts due
under the Note;
(iv) Receipt by Beneficiary from Trustor of sufficient cash funds to
cover one hundred percent (I 00%) of any difference between the estimated costs
of completion, as certified by an architect or engineer approved by Beneficiary in
writing, and the Proceeds, the amount of such difference shall be paid in cash to
Beneficiary with said amount and any interest earned thereon shall be released to
Beneficiary, as necessary, following the exhaustion of available insurance
proceeds, or at such earlier time deemed appropriate by Beneficiary. In the event
of any default under the Note, this Deed of Trust, or any reconstruction
requirements, Beneficiary may, at its option, apply any portion or all of such
amounts and interest against the accrued interest and principal sums outstanding
under the Note;
(v) Receipt by Beneficiary of a certificate executed by Trustor
describing the work to be performed in connection with such restoration and a
certificate by an independent architect or engineer selected or approved by
Beneficiary in writing stating that the work described in the Trusto(s certificate is
adequate to restore the Property to substantially the same size, design, quality and
condition as existed prior to the damage. The architect's or engineer's certificate
shall include its estimate of all costs and expenses which will be required to
complete such restorations; and
(vi) Such additional conditions as may reasonably be imposed by
Beneficiary to provide assurance that the Proceeds will be used to restore the
Property to substantially the same condition, to the extent possible, as existed
prior to the damage or taking, including, without limitation, Beneficiary's prior
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written approval of all permits, plans, specifications and construction contracts for
such restoration.
(c) Beneficiary shall disburse the Proceeds in increments corresponding to
the percentage of completion costs then incurred for labor performed and materials furnished
(which may, at Beneficiary's discretion, be subject to reasonable holdbacks required by
Beneficiary, not exceeding ten percent (10%) of the total estimated cost of completion and which
will be released upon lien-free completion of the restorations in accordance with the
requirements of this Deed of Trust and the expiration of the periods within which any
mechanic's or materialman's lien may be filed, without the filing of any such lien).
Disbursements shall be conditioned upon Beneficiary's written confirmation that all of its
requirements therefor have been satisfied, including its receipt of periodic inspection and
completion percentage certificates executed by the project architect approved by Beneficiary in
writing, payment acknowledgments and unconditional lien releases, and such other conditions to
periodic disbursements as are customarily imposed by institutional commercial lenders in
connection with construction loans, no defaults or misrepresentations of Trustor and Trustor's
obtaining all title insurance endorsements, payment and performance bonds, and builder's risk
policies required by Beneficiary. Trustor shall, during the progress of the work, also submit to
the Beneficiary, at periodic intervals not less frequently than monthly, a certificate satisfactory to
Beneficiary furnished by an architect or engineer approved by Beneficiary in writing showing
the cost of labor and materials incorporated into the work during the period specified in the
certificate, which period shall not include any part of the period covered by any other such
certificate; and
(d) After completion of the restoration and subject to the conditions herein
stated, and, if Trustor is not then in default under the Note, this Deed of Trust or any other
Transaction Documents, Beneficiary shall pay to Trustor (or such other persons or entities that
may have an interest therein) the undisbursed Proceeds and Trustor's deposit for any estimated
restoration expense held by Beneficiary upon delivery to Beneficiary of (i) a certificate executed
by Trustor showing that the work has been completed and that all bills for labor performed and
materials furnished in connection therewith have been paid, (ii) unconditional lien releases and
other appropriate written acknowledgments of payment in full executed by all contractors and
subcontractors performing labor on or furnishing materials to the Property; (iii) a certificate
executed by an architect or engineer approved by Beneficiary confirming that the Property has
been restored to substantially the same size, design, quality and condition as existed immediately
prior to the damage and in accordance with all applicable federal, state, local and other
governmental laws and regulations; and (iv) a certificate of occupancy and other permits issued
by the appropriate governmental authorities authorizing the occupancy of the Property for its
intended purposes and use.
If (i) any of the conditions in subparagraph 12(b), above, are not fulfilled within
sixty (60) days after the date of the casualty, or if the reconstruction cannot be completed within
such 60 day period, within such additional time as may be reasonably necessary to complete the
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reconstruction, not to exceed one hundred eighty (180) days, and provided such additional time
does not result in a breach by the Trustor under the Note, this Deed of Trust or any other
Transaction Documents; or (ii) if Trustor fails to exercise diligence in promptly commencing or
continuously prosecuting the work; or (iii) if Trustor is otherwise in default under the Note, this
Deed of Trust, other Transaction Documents or any reconstruction requirements set forth therein
or herein, Beneficiary may, at its option, apply the Proceeds and any deposits made by Trustor
hereunder to the indebtedness secured hereby, or to complete the necessary repairs and use the
Proceeds for the payment thereof. If the Proceeds are so applied to the indebtedness and,
together with any other payments due to Beneficiary under the Note and all other debts of
Trustor to Beneficiary are discharged, Beneficiary shall not have the right to require the Property
to be repaired under the terms of this Deed of Trust, but Beneficiary's rights under any other lien
that it holds against the Property and which is not also required to be released shall not be
thereby impaired or affected.
Trustor shall not commence any repairs or reconstruction of any casualty until
Beneficiary consents in writing thereto, which consent may be withheld by Beneficiary in its sole
discretion, until all of the conditions contained in this paragraph are satisfied. All work of
repairing or restoring damage shall be done in a good and workmanlike manner with materials of
good quality and in conformity with all applicable laws, ordinances, rules and regulations.
Nothing herein contained shall be construed as authorizing the Trustor to subject the Property to
any mechanic's, materialman's or other lien for the payment of bills for material furnished or
labor performed in connection with any work contemplated by this paragraph.
In any event in which the Beneficiary is not otherwise obligated to permit the
insurance proceeds to be applied to the restoration of the Property as hereinabove described and,
at the option of Beneficiary, the proceeds of a loss under any policy, whether or not endorsed
payable to Beneficiary, may be applied in payment of the principal, interest or any other sums
secured by this Deed of Trust, whether or not then due, or to the restoration or replacement of
any building on the Property, without in any way affecting the enforceability or priority of the
lien of this Deed of Trust or the obligation of the Trustor or any other person for payment of the
indebtedness hereby secured or the reconstruction of the damaged improvements, whether such
Trustor be the then owner of said building or improvements or not.
13. Use of Condemnation Awards. Should the Property or any portion thereof or any
improvements thereon be taken or damaged by reason of any public improvement or
condemnation proceeding, or by any other form of eminent domain, Trustor agrees that
Beneficiary shall be entitled to all compensation, awards and other payments or relief therefor
and may, at its option, commence, appear in or prosecute in its own name any action or
proceeding or make any reasonable compromise or settlement in connection with such taking or
damage, and Trustor agrees to pay Beneficiary's costs and reasonable attorneys' fees incurred in
connection therewith. All such compensation, awards, damages, rights of actions and proceeds
may be applied by Beneficiary toward the repair of any damage to the improvements on any
portion of the Property not subject to the taking as and subject to the same conditions herein
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provided with respect to the disposition of insurance proceeds; provided, however, that if the
taking results in a loss of the Property to an extent which, in the reasonable opinion of
Beneficiary, renders or will render the Property not economically viable or which substantially
impairs Beneficiary's security or lessens to any extent the value, marketability or intended use of
the Property, Beneficiary may apply the condemnation proceeds to reduce the unpaid
indebtedness secured hereby in such order as Beneficiary may determine. Trustor agrees to
execute such further assignments of condemnation proceeds as Beneficiary or Trustee may from
time to time require. If so applied, any proceeds in excess of the unpaid principal and accrued
interest due under the Note plus all other sums due to Beneficiary from Trustor shall be paid to
Trustor or Trustor's assignee.
14. Propertv Taxes and Assessments. Trustor shall pay in full on or before the due
date thereof all rents, taxes, assessments and encumbrances, with interest, that may now or
hereafter be levied, assessed or claimed upon the Trustor's ownership or use of the Property that
is the subject of this Deed of Trust or any part thereof, and upon request, provide the Beneficiary
with copies of official receipts for payment therefor, and shall pay all taxes imposed upon, and
reasonable costs, fees and expenses of, this Deed of Trust.
15. Assessment Districts. Trustor agrees not to consent to inclusion of the Land in any
local improvement or special assessment district or to the imposition of any special or local
improvement assessment against the Property, without Beneficiary's prior written consent.
16. Mortgage Taxes. In the event of the passage after the date of this Deed of Trust of
any federal, state or municipal law, ordinance or regulation relating to the taxation of mortgages,
deeds of trust or debts secured thereby so as to tax or assess any interest of Beneficiary or any
payments secured hereby. Trustor shall bear and pay the full amount of such taxes.
17. Special Assessment and Insurance Reserves. Trustor shall, at the request of the
Beneficiary, pay to Beneficiary equal monthly installments of the special assessments and
insurance premiums estimated by the Beneficiary next to become due, in addition to any other
periodic payment or performances owed by Trustor under the Note or any other Transaction
Documents or this Deed of Trust, so that thirty (30) days before the due date thereof, or of the
first installment thereof, Beneficiary will have on hand an amount sufficient to pay the next
maturing assessments and insurance premiums. The amount of the additional payment to be
made on account of assessments and insurance premiums shall be adjusted annually or more
frequently as Beneficiary deems necessary and any deficit shall be immediately paid by Trustor
upon request and any surplus shall be credited on the mortgage account. Subsequent payments
on account of assessments and insurance premiums shall be made in accordance with the next
estimate by the Beneficiary of annual requirements. To the extent permitted by applicable law,
all monies paid to Beneficiary on account of assessments or insurance premiums may be
commingled and invested with Beneficiary's own funds and, unless and to the extent required by
law, shall not bear interest for Trustor. Beneficiary shall not exercise the rights granted in this
paragraph so long as all of the following conditions are met:
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(a) There is no default under the Note, this Deed of Trust or any other
Transaction Documents; and
(b) Trustor pays all assessments and insurance premiums prior to delinquency.
Upon Trustor's failure to comply with either of conditions (a) or (b), above,
Beneficiary may, at its option, then or thereafter exercised, require Trustor to pay the additional
sums described in this paragraph.
18. Trustor's Right to Contest Taxes. Trustor shall have the right to contest any real
property tax or special assessment so long as (a) no defaults exist under the Note, this Deed of
Trust or any other Transaction Documents; (b) Trustor makes any payment or deposit or posts
any bond as and when required as a condition to pursuing such contest; (c) Trustor commences
such contest prior to such tax or assessment becoming delinquent and continuously pursues the
same in good faith and with due diligence; (d) such contest or any bond furnished by Trustor
stays the foreclosure of any lien securing the payment of any such tax or assessment; and (e)
Trustor pays any tax or assessment within ten (IO) days following the date ofresolution of such
contest.
19. Report of Real Estate Transaction. Trustor has made or provided for making, or
will make or provide for making, on a timely basis, any reports or returns required by state or
local law relating to the Property, or the development of the Property, notwithstanding the fact
that the primary reporting responsibility may fall on the Beneficiary, or other party. Trustor's
obligations under this paragraph will be deemed to be satisfied, if proper and timely reports and
returns required under this paragraph are filed by a title company involved in each real estate
transaction relating to the Property, but nothing contained herein shall be construed to require
such returns or reports to be filed by Beneficiary.
20. Leases. With respect to any leases currently or hereafter relating to any portion of
the Property, Trustor agrees that:
(a) Prior to the execution of any such lease or rental agreement by the Trustor,
the Trustor shall give the Beneficiary thirty (30) days written notice setting forth the identity of
the tenant and the relevant terms of the proposed lease;
(b) Each such lease shall comply with the covenants of the Trustor under the
Note, the Agency Quitclaim Deed, this Deed of Trust and the other Transaction Documents;
(c) Trustor shall fully comply with all of its obligations under all leases on the
Property, so that the same shall not become in default and shall do all that is necessary to
preserve the same in force;
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(d)
thereunder; and
Trustor shall not permit an assignment of any leases, or any subletting
(e) Beneficiary and its successors and assigns (including any purchaser at a
foreclosure or trustee's sale) shall have the right, at its option, to recognize and continue in effect
any such leasehold interests following any foreclosure or trustee's sale hereunder.
21. Assignment of Leases. Trustor hereby unconditionally and absolutely assigns,
transfers and sets over unto Beneficiary, all leases, subleases, rental agreements, occupancy
agreements, licenses, concessions, entry fees and other agreements that grant a possessory.
interest or right of entry in all or any part of the Property, together with all rents, issues, deposits
and profits of the Property, together with the immediate and continuing right to collect and
receive the same, for the purpose and upon the terms and conditions hereinafter set forth. Trustor
further unconditionally and absolutely assigns, transfers and sets over unto Beneficiary all of its
right, title and interest in and to any plans, drawings, specifications, permits, engineering reports
and land planning maps, which it now has or may hereafter acquire regarding any improvements
now on or to be constructed upon the Property. Beneficiary confers upon Trustor a license to
collect and retain the rents, issues, deposits and profits of the Property, as they become due and
payable, subject, however, to the right of Beneficiary upon a default hereunder to revoke said
license, at any time, in its sole discretion and without notice to Trustor. Beneficiary may revoke
said license and collect and retain the rents, issues, deposits and profits of the Property assigned
herein to Beneficiary upon the occurrence of an Event of Default hereunder or Trustor's default
under any of the obligations secured hereby, and without taking possession of all or any part of
the Property, and without prejudice to or limitation upon any of its additional rights and remedies
granted pursuant hereto or pursuant to the Note or any other Transaction Documents, and
Beneficiary shall, in its sole and absolute discretion, have the right to apply such income for the
payment of all expenses or credit the net amount of income that it receives from the Property, to
the indebtedness in the manner, order and amounts as Beneficiary shall determine. In the event
the Beneficiary exercises or is entitled to exercise any of its rights or remedies under this Deed of
Trust as a result of the default of the Trustor under the Note, and if any lessee, sublessee or
assignee under any lease assigned under this paragraph files or has filed against it any petition in
bankruptcy or for reorganization or undertakes or is subject to similar action, Beneficiary shall
have, and is hereby assigned by Trustor, all of the rights that would otherwise inure to the benefit
of Trustor in such proceedings, including, without limitation, the right to seek "adequate
protection" of its interests, to compel assumption or rejection of any such lease and to seek such
claims and awards as may be sought or granted in connection with the rejection of any such
lease. Unless otherwise agreed to by Beneficiary in writing, Beneficiary's exercise of any of the
rights provided in this paragraph shall preclude Trustor from the pursuit and benefit thereof,
without any further action or proceeding of any nature. The foregoing assignment shall not
impose upon Beneficiary any duty to produce rents from the Property, and such assignment shall
not cause Beneficiary to be a "mortgagee in possession" for any purpose. The rights granted in
this paragraph shall be in addition to and not in derogation of any similar or related rights
granted to Beneficiary in any separate assignment of leases and rents.
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22. Impairment of Securitv. Trustor shall not, without first obtaining Beneficiary's
written consent, assign any of the rents or profits of the Property or change the general nature or
use of the Property or initiate or acquiesce in any zoning reclassification, or do, or suffer to be
done, any act or thing that would impair the security of Beneficiary's lien upon the Property or
the rents thereof. Trustor shall not, without the written consent of Beneficiary, (i) initiate or
support any zoning reclassification of the Property, seek any variance under existing zoning
ordinances applicable to the Property or use or permit the use of the Property in a manner that
would result in such use becoming a non-conforming use under applicable zoning ordinances;
(ii) modify, amend or supplement any easement, reservation, restriction, covenant, condition or
encumbrance pertaining to the Property; (iii) impose or consent to any restrictive covenant or
encumbrance upon the Property, execute or file any subdivision or parcel map affecting the
Property or consent to the annexation of the Property to any municipality; or (iv) permit or suffer
the Property to be used by the public or any person in such manner as might make possible a
claim of any implied dedication or easement.
23. Defense of Suits. Trustor shall appear in and defend any suit, action or proceeding
that might affect the value, priority or enforceability of this Deed of Trust or the Property itself
or the rights or powers of Beneficiary or Trustee, including any suits relating to damage to
property or dcath or personal injuries, whether or not Trustor is ultimately found liable for any
negligence or other wrongful conduct or inaction. Trustor, following mutual negotiations with
Beneficiary, has waived and does hereby waive any immunity to such liability to Beneficiary
under any industrial insurance or similar statute, to the extent such immunity would impair
Beneficiary's rights against Trustor. Should Beneficiary elect to appear in or defend any such
action or proceeding or be made a party to any such action or proceeding by reason of this Deed
of Trust, or elect to prosecute such action as appears necessary to preserve the value, priority or
enforceability of this Deed of Trust or the Property itself, Trustor will at all times indemnify
Beneficiary and Trustee from and, on demand, reimburse Beneficiary and Trustee for, any and
all loss, damage, expense or cost, including cost of evidence of title, expert witness fees and
attorneys' fees, arising out of or incurred in connection with any such suit, action or proceeding,
and any appeal or petition for review thereof, and the sum of such expenditures shall be secured
by this Deed of Trust with interest at the rate of 10% per annum and shall be due and payable on
demand. Trustor shall pay costs of suit, cost of evidence of title, expert witness fees and
reasonable attorneys' fees in any proceeding or suit brought by Beneficiary to foreclose this
Deed of Trust and in any appeal therefrom or petition for review thereof.
24. Assignments and Transfers. Trustor acknowledges that Beneficiary relied upon
Trustor's financial statements, credit history, business and real property managerial expertise and
other factors personal to Trustor in making the Loan, and Trustor covenants not to transfer any of
the interest in the Property or to permit the transfer of any interest in Trustor without first
receiving Beneficiary's express written consent in each instance. A breach of this covenant shall
constitute a default under the Note and this Deed of Trust. All sums then due to Beneficiary by
Trustor hereunder, under the Note may, at Beneficiary's option, be declared immediately due and
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payable if any of Trustor's interests in the Property, or any part thereof, are sold or transferred,
voluntarily or involuntarily, without Beneficiary's prior written consent.
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25. Matters Requiring Beneficiarv's Prior Consent. So long as any part of the Loan
remains unpaid, Trustor shall not do or suffer any of the following without Beneficiary's prior
written consent, which Beneficiary may grant or withhold in each instance in Beneficiary's sole
and absolute discretion: (i) change its form of organization; (ii) modify its organizational
documents; (iii) cause itself to become organized as the same or any other type of legal entity in
a jurisdiction other than that under the laws of which it is organized on the date of this Deed of
Trust; (iv) merge with or into, consolidate with, or become subject to control by any other legal
entity; (v) except as permitted pursuant to Section 24, make or suffer any change in its ownership
or management, or become subject to control by persons other than its owners on the date of this
Deed of Trust, voluntarily or by operation of law; (vi) sell, convey, assign, or transfer any
Property or any interest therein, whether legal or equitable, directly or indirectly; (vii) create,
incur, assume,suffer to exist, or otherwise become liable on any indebtedness relating to the
Property other than (1) the Loan; and (2) ordinary course trade payables incurred in connection
with the ownership and operation of the Property, none of which shall exceed an amount
reasonable and customary for such an expenditure for properties similar in type, size, and
character to the Property located in the area of the Property; or (viii) grant or suffer the
imposition of any lien upon, security interest in, or other encumbrance of any of the Property.
Any violation of the provisions of this Section 25 shall constitute an Event of Default under this
Deed of Trust and each other Transaction Document, with respect to which Beneficiary shall
have the right to accelerate the maturity of the Loan and pursue all other remedies available to
Beneficiary under this Deed of Trust, any other Transaction Document, and/or applicable law.
26. Further Encumbrances. Trustor acknowledges that Beneficiary relied upon the
Property not being subject to additional liens or encumbrances for reasons including, but not
limited to, the possibility of competing claims or the promotion of plans disadvantageous to
Beneficiary in bankruptcy; the risks to Beneficiary in a junior lienholder's bankruptcy; questions
involving the priority of future advances, the priority of future leases of the Property, the
marshaling of Trustor's assets, and the Beneficiary's rights to determine the application of
condemnation awards and insurance proceeds; the impairment of the Beneficiary's option to
accept a deed in lieu of foreclosure; the increased difficulty of reaching agreements for workouts
or to the actions to be taken by trustees, receivers, liquidators and fiduciaries; and Beneficiary's
requirements of Trustor's preservation of its equity in the Property and the absence of debt that
could increase the likelihood of Trustor being unable to perform its obligations when due.
Therefore, as a principal inducement to Beneficiary to make the Loan secured by this Deed of
Trust, and with the knowledge that Beneficiary will material1y rely upon this paragraph in so
doing, Trustor covenants not to encumber the Property, without first receiving Beneficiary's
express written consent in each instance, which consent may be withheld by Beneficiary in its
sole discretion. A breach of this covenant shall constitute a default under the Note and this Deed
of Trust, and Beneficiary may exercise all remedies available to Beneficiary under the Note or
this Deed of Trust. Without limiting the generality of the foregoing, no mortgages, deeds of trust
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or other forms of security interests prior or subordinate to the security interests of Beneficiary
shall encumber any real or personal property that is the subject of any lien or security interest
granted to Beneficiary, without Beneficiary's prior written consent.
27. Event of Default. An "Event of Default" shall be deemed to have occurred in any
of the following circumstances:
(a) Failure of Trustor to satisfy any perfonnance or payment obligation
required under this Deed of Trust, the Note, the Agency Quitclaim Deed or any other
Transaction Document when due;
(b) Failure of Trustor to properly perform its obligations under this Deed of
Trust, the Note, the Agency Quitclaim Deed or any other Transaction Document, by a date
specified herein or therein or in a written notice to Trustor, if applicable;
(c) The condemnation, seizure or appropriation of, or the occurrence of an
uninsured casualty with respect to, any material (as determined by Beneficiary) portion of the
Property;
(d) Trustor becomes insolvent or generally is not paying its debts as they
become due, as defined in the United States Bankruptcy Reform Act, as amended from time to
time (which Act, as amended, is herein called the "Bankruptcy Code"), or shall file a voluntary
petition in bankruptcy seeking to effect a reorganization plan or other arrangement with creditors
or any other relief under the Bankruptcy Code or under any other state or federal law relating to
bankruptcy or other relief for debtors, whether now or hereafter in effect, or shall consent to or
suffer the entry of any order for relief in any involuntary case under the Bankruptcy Code, or
shall be the defendant or subject of any involuntary petition filed under the Bankruptcy Code that
is not dismissed within ninety (90) days of the filing thereof, or shall make an assignment for the
benefit of creditors;
(e) Any court (or similar tribunal) having jurisdiction over Trustor or any of
the Property or other property of Trustor shall enter a decree or order appointing a receiver,
trustee, guardian, conservator, assignee in bankruptcy or insolvency of Trustor, of any of the
Property, of any other real property of Trustor, of any other significant asset of Trustor, or shall
enter a decree or order for relief in any involuntary case under the Bankruptcy Code;
(I) The entry of any final judgment or arbitration award against Trustor that is
not paid or stayed pending appeal, or the sequestration or attachment of, or any levy or execution
upon (i) any of the Property, (ii) any other collateral provided by Trustor or any other person
under this Deed of Trust or as security for performance or payment of the Loan, or (iii) any
significant portion of the other assets of Trustor, which is not released, expunged or dismissed
prior to the earlier of (I 0) days after such sequestration, attachment or execution or five (5) days
before the sale of any such assets;
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(g) Trustor shall dissolve, liquidate or wind up its affairs or shall bring any
legal action or take any other action contemplating such dissolution, liquidation or winding up;
(h) The determination by Beneficiary that any representation, warranty or
statement contained in this Deed of Trust, the Disposition and Development Agreement, the
Note or in any other writing delivered to Beneficiary in connection with the Disposition and
Development Agreement or any other Transaction Documents was incomplete, untrue or
misleading in any material respect as of the date made;
(i) The enactment of any law that deducts from the value of the Property for
the purpose of taxation of any lien thereon or imposing upon Beneficiary the payment of the
whole or any part of the taxes, assessments, charges or liens herein required to be paid by Trustor
or changing in any way the laws relating to the taxation of deeds of trust or debts secured by
deeds of trust or Beneficiary's interest in the Property or the manner of collection of taxes so as
to affect this Deed of Trust or the Note or any other Transaction Documents or the holder thereof
or imposing a tax, other than a Federal or state income tax, on or payable by Trustee or
Beneficiary by reason of their ownership of this Deed of Trust or the Note or any other
Transaction Documents and, in such event, Trustor, after demand by Beneficiary, does not pay
such taxes or assessments or reimburse Beneficiary therefor or, in the opinion of counsel for
Beneficiary, it might be unlawful to require Trustor to make such payment or the making of such
payment might result in the imposition of interest costs beyond the maximum amount permitted
by applicable law;
(j) The occurrence of a default by Trustor under any of the contracts or
agreements assigned to Beneficiary under this Deed of Trust, where such default is not cured
within the applicable cure period, if any, or the failure of Trustor to diligently enforce its rights
and remedies under such contracts and agreements upon the default of any other party thereto;
and
(k) Trustor acknowledges and agrees that all material non-monetary defaults
are conclusively deemed to be and are defaults impairing the security of this Deed of Trust, and
that Beneficiary shall be entitled to exercise any appropriate remedy, including, without
limitation, foreclosure of this Deed of Trust, upon the occurrence of any such material non-
monetary default.
29. Rights and Remedies on Default. Upon the occurrence of any Default or Event of
Default under this Deed of Trust and at any time thereafter, Trustee or Beneficiary may exercise
anyone or more of the following rights and remedies:
(a) Note Remedies. Beneficiary may exercise any right or remedy provided
for in the Note, or any other Transaction Documents;
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(b) Acceleration. Beneficiary may declare the Loan and all other
performances or sums secured by this Deed of Trust immediately due and payable;
(c) Foreclosure Rights. Beneficiary may declare all performances or sums
secured by this Deed of Trust immediately due and payable either by commencing an action to
foreclose this Deed of Trust as a mortgage, or by the delivery to Trustee of a written declaration
of default and demand for sale and of written notice of default and of election to cause the
Property to be sold, which notice Trustee shall cause to be duly filed for record in case of
foreclosure by exercise of the power of sale herein. Should Beneficiary elect to foreclose by
exercise of the power of sale herein, Beneficiary shall also deposit with Trustee this Deed of
Trust, the documents evidencing the Loan and any receipts and evidence of expenditures made
and secured hereby as Trustee may require, and notice of sale having been given as then required
by law and after lapse of such time as may then be required by law after recordation of such
notice of default, Trustee, without demand on Trustor, shall sell the Property at the time and
place of sale fixed by it in said notice of sale, either as a whole or in separate parcels, and in such
order as it may determine, at public auction to the highest bidder upon any terms and conditions
specified by Beneficiary and permitted by applicable law. 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 may postpone such sale by public announcement at the time fixed by the
preceding postponement. Trustee shall deliver to any purchaser its deed or deeds conveying the
Property, or any portion thereof, so sold, but without any covenant or warranty, express or
implied. The recitals in such deed or deeds of any matters or facts, shall be conclusive proof of
the truthfulness thereof. Any person, including Trustor, Trustee or Beneficiary, may purchase all
or any portion of the Property, as applicable, at sale.
(d) Right to Rescind. Beneficiary, from time to time before Trustee's sale,
may rescind any such notice of breach or default and of election to cause the Property to be sold
by executing and delivering to Trustee a written notice of such rescission, which notice, when
recorded, shall also constitute a cancellation of any prior declaration of default and demand for
sale. The exercise by Beneficiary of such right of rescission shall not constitute a waiver of any
breach or default then existing or subsequently occurring, or impair the right of Beneficiary to
execute and deliver to Trustee, as above provided, other declarations of default and demand for
sale, and notices of breach or default, and of election to cause the Property to be sold to satisfy
the obligations hereof, nor otherwise affect any provision, agreement, covenant or condition of
the Note, the Agency Quitclaim Deed and/or of this Deed of Trust or any of the rights,
obligations or remedies of the parties hereunder.
(e) UCC Remedies. Beneficiary shall have all the rights and remedies of a
secured party under the California Commercial Code, including, without limitation, Section
9501(4) thereof. Upon request, Trustor shall assemble and make such collateral available to
Beneficiary at a place to be designated by Beneficiary that is reasonably convenient to both
parties. Upon repossession, Beneficiary may propose to retain the collateral in partial satisfaction
of the Loan or sell the collateral at public or private sale in accordance with the California
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Commercial Code or any other applicable statute. Such sale may be held as a part of, distinctive
from or without a trustee's sale or foreclosure of the real property secured by this Deed of Trust.
If any notification of disposition of all or any portion of the collateral is required by law, such
notification shall be deemed reasonably and properly given, if mailed at least ten (10) days prior
to such disposition. If Beneficiary disposes of all or any part of the collateral after default, the
proceeds of disposition shall be applied in the following order:
(i) to the reasonable expenses of retaking, holding, preparing
for sale, selling the collateral, and the like;
(ii) to the reasonable attorneys' fees and legal expenses
incurred by Beneficiary; and
(iii) to the satisfaction of the indebtedness secured by this Deed
of Trust.
(f) Remedial Advances. Should Trustor fail to make any payment or to do
any act as herein provided, then Beneficiary or Trustee, without obligation so to do and without
demand upon Trustor and without releasing Trustor from any obligation hereof, may (i) make or
do the same in such manner and to such extent as either may deem necessary to protect the
security hereof, Beneficiary or Trustee being authorized to enter upon the Property for such
purposes; (ii) commence, appear in and defend any action or proceeding purporting to affect the
security hereof or the rights or powers of Beneficiary or Trustee, (iii) pay, purchase, contest or
compromise any encumbrance, charge, lien, tax or assessment, or the premium for any policy of
insurance required herein; and in exercising any such power, incur any liability, expend whatever
amounts in its absolute discretion it may deem necessary therefor, including cost of evidence of
title, employ counsel and pay such counsel's fees. Beneficiary shall be subrogated to the rights
and lien interests of any person who is paid by Beneficiary pursuant to the terms of this
paragraph. Trustor shall repay immediately on written notice to Trustor all sums expended or
advanced hereunder by or on behalf of Beneficiary, with interest from the date of such advance
or expenditure at the rate of 10% per annum, and the repayment thereof shall be secured hereby.
(g) Summary Possession. Beneficiary may, at its option, either in person or by
agent, employee or court-appointed receiver, enter upon and take possession of the Property and
continue any work of improvement, repair or renovation thereof at Trustor's expense and lease
the same or any part thereof, making such alterations as it finds necessary, and may terminate in
any lawful manner any lease(s) of the Property, exercising with respect thereto any right or
option available to the Trustor. The entering upon and taking possession of the Property, the
collection of rents, issues and profits, or the proceeds of fire and other insurance policies or
compensation or awards for any taking or damage to the Property, and the application or release
thereof shall not cure or waive any default or notice of default hereunder or invalidate any act
done pursuant to such notice.
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(h) Collection of Rents. Beneficiary may require any tenant or other user of
the Property to make payments of rent or use fees directly to Beneficiary, regardless of whether
Beneficiary has taken possession of the Property. If any rents are collected by Beneficiary, then
Trustor hereby irrevocably designates Beneficiary as Trustor's attorney-in-fact to endorse
instruments received in payment thereof in the name of Trustor and to negotiate the same and
collect the proceeds. Payments by tenants or other users to Beneficiary in response to
Beneficiary's demand shall satisfy the obligation for which the payments are made, whether or
not any proper grounds for the demand existed. Beneficiary may exercise its rights under this
paragraph either in person, by agent or through a receiver.
(i) Beneficiary's Enforcement of Leases. Beneficiary is hereby vested with
full power to use all measures, legal and equitable, deemed by it necessary or proper to collect
the rents assigned in this Deed of Trust, including the right, in person or by agent, employee or
court-appointed receiver, to enter upon the Property, or any part thereof, and take possession
thereof forthwith to the extent necessary to effect the cure of any default on the part of Trustor as
lessor in any leases or upon Trustor's default under the Note. Trustor hereby grants to
Beneficiary full power and authority to exercise all rights, privileges and powers herein granted
at any and all times hereafter, without notice to Trustor, including the right to operate and
manage the Property, make and amend leases and perform any other acts reasonably necessary to
protect the value, priority or enforceability of any security for the obligations of the Trustor
under the Note or this Deed of Trust and use and apply all of the rents and other income herein
assigned to the payment of the costs of exercising such remedies, of managing and operating the
Property, and of any indebtedness or liability of Trustor to Beneficiary, including but not limited
to the payment of taxes, special assessments, insurance premiums, damage claims, the costs of
maintaining, repairing, rebuilding and restoring any improvements on the Property or of making
the same rentable, attorneys' fees incurred in connection with the enforcement of this Deed of
Trust, and any principal and interest payments due from Trustor to Beneficiary under the Note
and this Deed of Trust, all in such order as Beneficiary may determine. Beneficiary shall be
under no obligation to enforce any of the rights or claims assigned to it hereunder or to perform
or carry out any of the obligations of the lessor under any leases and does not assume any of the
liabilities in connection with or arising or growing out of the covenants and agreements of
Trustor in any leases. It is further understood that this Deed of Trust shall not operate to place
responsibility for the control, care, management or repair of the Property, or parts thereof, upon
Beneficiary nor shall it operate to make Beneficiary liable for the carrying out of any of the
terms and conditions of any leases, or for any waste of the Property by the lessee under any
leases or by any other party, or for any dangerous or defective condition of the Property or for
any negligence in the management, upkeep, repair or control of the Property resulting in loss or
injury or death to any lessee, invitee, licensee, employee or stranger, except as may result from
the gross negligence or willful misconduct of Beneficiary after taking possession of the Property
hereunder.
(j) Beneficiary's Enforcement of Contracts. Beneficiary shall have the right
to enforce Trustors rights under all architect, engineering, construction and related contracts and
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to bring an action for the breach thereof in the name of Beneficiary or, at Beneficiary's option, in
the name of Trustor, in the event any architect, engineer, contractor or other party breaches their
respective contract or contracts, regardless of whether Beneficiary acquires or retains any interest
in the Property. Trustor hereby irrevocably appoints Beneficiary as its attorney-in-fact for the
purposes of the foregoing, which power shall be durable and coupled with an interest.
Beneficiary does not assume and shall not be obligated to perform any of Trustor's obligations
under said contracts nor shall Beneficiary be required to enforce such contracts or bring action
for the breach thereof; provided however, any performance of the respective contracts
specifically required by the Beneficiary in writing, following any default by Trustor under the
Note, this Deed of Trust, any other Transaction Documents or the contracts, and which is
properly and timely undertaken by the contractor, engineer or architect, shall be paid for by the
Beneficiary in accordance with the terms and conditions of the contracts. Such payments shall be
deemed additions to the amounts owed by Trustor to the Beneficiary under the Note and secured
by this Deed of Trust and shall bear interest at the rate of 10% per annum from the date of
advance to and including the date of full payment, and shall be secured by any deed of trust,
collateral assignment of leases and rents, security agreement and other documents granted to
secure the Loan.
(k) Appointment of Receiver. Beneficiary has the right to have a receiver
appointed to take possession of any or all of the Property, with the power to protect and preserve
the Property, to operate the Property preceding foreclosure or sale, to collect the income from the
Property and apply the proceeds, over and above the cost of the receivership, against the Loan.
The receiver may serve without bond, if permitted by law. Beneficiary's right to the
appointment of a receiver shall exist whether or not the apparent value of the Property exceeds
the indebtedness secured hereby by a substantial amount. Employment by Beneficiary shall not
disqualify a person from serving as a receiver. Upon taking possession of all or any part of the
Property, the receiver or Beneficiary may: (i) use, operate, manage, control and conduct business
on the Property and make expenditures for all maintenance and improvements as in its judgment
are necessary and proper; (ii) collect the income from the Property and apply such sums to the
expenses of use, operation and management; and (iii) at Beneficiary's option, complete any
construction in progress on the Property, and in that connection pay bills, borrow funds, employ
contractors and make any changes in plans or specifications as Beneficiary deems reasonably
necessary or appropriate. If the revenues produced by the Property are insufficient to pay
expenses, the receiver may borrow, from Beneficiary or otherwise, as Beneficiary may deem
reasonably necessary for the purposes stated in this paragraph. The amounts borrowed or
advanced shall be payable on demand and bear interest from the date of expenditure until repaid
at the rate of 10% per annum. Such sums shall become a part of the debt secured by this Deed of
Trust.
(I) Specific Enforcement. Beneficiary may specifically enforce any covenant
in this Deed of Trust or the Trustor's compliance with its warranties herein and may restrain and
enjoin the breach or prospective breach of any such covenant or the noncompliance with any
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condition and Trustor waives any requirement of the posting of any bond In connection
therewith.
(m) General Creditors' Remedies. Beneficiary shaJl have such other rights and
remedies as are available under any statute or at law or in equity, generaJly, and the delineation
of certain remedies in this Deed of Trust shall not be deemed in limitation thereof
30. Application of Sale Proceeds. After deducting aJl costs and expenses of Trustee
and of this Deed of Trust, including cost of evidence of title and reasonable attorneys' fees in
connection with sale, as above set forth, Trustee shall apply the proceeds of sale to payment of
all sums expended under the terms hereof, not then repaid, with accrued interest at the rate of
10% per annum; all other sums then secured hereby; and the remainder, if any, to the Beneficiary
and any other person or persons legaJly entitled thereto.
31. Remedies Cumulative. No remedy herein conferred upon or reserved to Trustee or
Beneficiary is intended to be exclusive of any other remedy provided herein or under the
Disposition and Development Agreement or any other Transaction Documents, or otherwise by
law provided or permitted, or provided in any guaranty given in connection with the Loan, but
each shall be cumulative and shall be in addition to every other remedy. Every power or remedy
given by this instrument to Trustee or Beneficiary or to which either of them may be otherwise
entitled, may be exercised concurrently or independently, from time to time and as often as may
be deemed expedient by Trustee or Beneficiary and either of them may pursue inconsistent
remedies.
32. No Waiver. No waiver of any default or failure or delay to exercise any right or
remedy by Beneficiary shall operate as a waiver of any other default or of the same default in the
future or a preclusion of any right or remedy with respect to the same or any other occurrence.
33. Marshaling. In case of a sale under this Deed of Trust, the Property, real, personal
and mixed, may be sold in one or more parcels. Neither Trustee nor Beneficiary shall be required
to marshal Trustor's assets.
34. SUBMISSION TO JURISDICTION.
(A) TRUSTOR, TO THE FULLEST EXTENT PERMITTED BY LAW,
HEREBY K."IOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND
UPON THE ADVICE OF COMPETENT COUNSEL, (A) SUBMITS TO PERSONAL
JURISDICTION IN THE STATE OF CALIFORNIA OVER ANY SUIT, ACTION OR
PROCEEDING BY ANY PERSON ARISING FROM OR RELATING TO THIS DEED
OF TRUST, (B) AGREES THAT ANY SUCH ACTION, SUIT OR PROCEEDING MAY
BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION SITTING IN SAN BERNARDINO COUNTY, CALIFORNIA, (C)
SUBMITS TO THE JURISDICTION OF SUCH COURTS, AND, (D) TO THE FULLEST
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EXTENT PERMITTED BY LAW, AGREES THAT IT WILL NOT BRING ANY
ACTION, SUIT OR PROCEEDING IN ANY FORUM OTHER THAN SAN
BEIUI/ARDINO COUNTY, CALIFORNIA (BUT NOTHING HEREIN SHALL AFFECT
THE RIGHT OF BENEFICIARY TO BRING ANY ACTION, SUIT OR PROCEEDING
IN ANY OTHER FORUM). TRUSTOR FURTHER CONSENTS AND AGREES TO
SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER LEGAL PROCESS IN ANY
SUCH SUIT, ACTION OR PROCEEDING BY REGISTERED OR CERTIFIED U.S.
MAIL, POSTAGE PREPAID, TO THE TRUSTOR AT THE ADDRESS FOR NOTICES
DESCRIBED HEREIN, AND CONSENTS AND AGREES THAT SUCH SERVICE
SHALL CONSTITUTE IN EVERY RESPECT VALID AND EFFECTIVE SERVICE
(BUT NOTHING HEREIN SHALL AFFECT THE VALIDITY OR EFFECTIVENESS
OF PROCESS SERVED IN ANY OTHER MANNER PERMITTED BY LAW).
(B) TRUSTOR, TO THE FULLEST EXTENT PERMITTED BY LAW,
HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND
UPON THE ADVICE OF COMPETENT COUNSEL, WAIVES, RELINQUISHES AND
FOREVER FORGOES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATING TO
THIS DEED OF TRUST OR ANY CONDUCT, ACT OR OMISSION OF BENEFICIARY
OR TRUSTOR, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE.
35. Trustor's Indemnification. Trustor agrees to indemnify and hold harmless Trustee
and Beneficiary from and against any and all losses, liabilities, penalties, claims, charges, costs
and expenses (including attorneys' fees and disbursements) (the "Losses") that may be imposed
on, incurred or paid by or asserted against Trustee and/or Beneficiary by reason or on account of,
or in connection with: (a) any default by Trustor hereunder or under the Note or other
Transaction Documents; (b) Trustee's and/or Beneficiary's good faith and commercially
reasonable exercise of any of their rights and remedies or the performance of any of their duties
hereunder or under any other documents to which Trustor is a party; (c) the construction,
reconstruction or alteration of the Property; (d) any negligence, willful misconduct or failure to
act of Trustor, or any negligence, willful misconduct or failure to act of any lessee of the
Property, or any of their respective agents, contractors, subcontractors, servants, employees,
licensees or invitees; or (e) any accident, injury, death or damage to any person or property
occurring in, on or about the Property or any street, drive, sidewalk, curb or passageway adjacent
thereto, except for the willful misconduct or gross negligence of the indemnified person; or (f)
any failure of Trustor to file any tax reports or returns referred to in this Deed of Trust. The
indemnity provided under subsection (f) of this paragraph shall also extend to counsel for the
Beneficiary. Any amount payable to Trustee, Beneficiary or counsel for Beneficiary under this
paragraph shall be due and payable within ten (10) days after demand therefor and receipt by
Trustor of a statement from Trustee, Beneficiary and/or counsel for Beneficiary setting forth in
reasonable detail the amount claimed and the basis therefor, and such amounts shall bear interest
at the rate of 10% per annum from and after the date such amounts are paid by Beneficiary,
Trustee or counsel for Beneficiary, until paid in full by Trustor. Trustor's obligations under this
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paragraph shall not be affected by the absence or unavailability of insurance covering the same
or by the failure or refusal by any insurance carrier to perform any obligation on its part under
any such policy of insurance. If any claim, action or proceeding is made or brought against
Trustor and/or Beneficiary that is subject to the indemnity set forth in this paragraph, Trustor
shall resist or defend against the same, if necessary, in the name of Trustee and/or Beneficiary,
with attorneys for Trustor's insurance carrier (if the same is covered by insurance) or otherwise
by attorneys approved by Beneficiary. Notwithstanding the foregoing, Trustee and Beneficiary,
in their reasonable discretion, may engage their own attorneys to resist or defend, or assist
therein, and Trustor shall pay, or, on demand, shall reimburse Trustee and Beneficiary for the
payment of the reasonable fees and disbursements of said attorneys. The indemnity provided for
herein shall survive Trustor's performance under the Disposition and Development Agreement
and the Note secured by this Deed of Trust and foreclosure, whether by judicial foreclosure,
power of sale pursuant to this Deed of Trust or by deed in lieu of foreclosure.
36. Attornevs' Fees; Costs. Trustor agrees to reimburse Beneficiary for all costs,
expenses expert witness and consulting fees and reasonable attorneys' fees that Beneficiary
incurs in connection with the realization or enforcement of any obligation or remedy contained in
this Deed of Trust, the Note or any other Transaction Documents, with or without litigation,
including without limitation any costs, expenses and fees incurred: (a) on appeal; (b) in any
arbitration or mediation; (c) in any action contesting or seeking to restrain, enjoin, stay, or
postpone the exercise of any remedy in which Beneficiary prevails; (d) in any bankruptcy,
probate, receivership or other proceeding involving Trustor; and (e) in connection with all
negotiations, documentation, and other actions relating to any work-out, compromise, settlement
or satisfaction of the debt secured hereby or settlement of any covenants and obligations secured
by this Deed of Trust or set forth in the Note, the Agency Quitclaim Deed or any other
Transaction Documents. For the purposes hereof, the words "reasonable attorneys' fees" shall
mean and include the salaries and fringe benefits of the City Attorney and lawyers employed by
the City Attorney of the City of San Bernardino, computed on a hourly basis, who may provide
legal services to the Beneficiary in connection with the exercise by the Beneficiary of any of its
remedies hereunder. All such costs, expenses and fees shall be due and payable upon demand,
shall bear interest from the date incurred through the date of collection at the rate of 10% per
annum, and shall be secured by this Deed of Trust.
37. Acceotance bv Trustee. Trustee accepts this Trust when this Deed of Trust, duly
executed and acknowledged, is made a public record, as provided by law.
38. Successor Trustee. Trustee may resign by an instrument in writing addressed to
Beneficiary, or Trustee may be removed at any time with or without cause by an instrument in
writing executed by Beneficiary and duly recorded. In case of the death, resignation, removal or
disqualification of Trustee or if for any reason Beneficiary shall deem it desirable to appoint a
substitute or successor trustee to act instead of Trustee herein named or any substitute or
successor trustee, then Beneficiary shall have the right and is hereby authorized and empowered
to appoint a successor trustee, or a substitute trustee, without other formality than appointment
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and designation in writing executed and acknowledged by Beneficiary and the recordation of
such writing in the office where this Deed of Trust is recorded, and the authority hereby
conferred shall extend to the appointment of other successor and substitute trustees successively.
Such appointment and designation by Beneficiary shall be full evidence of the right and authority
to make the same and of all facts therein recited. If such appointment is executed on behalf of
Beneficiary by an officer of Beneficiary, such appointments shall be conclusively presumed to be
executed with authority and shall be valid and sufficient without proof of any action by the
Trustee or any officer of Beneficiary. Upon the making of such appointment and designation, all
of the estate and title of Trustee in the Property shall vest in the named successor or substitute
trustee and it shall thereupon succeed to and shall hold, possess and execute all the rights,
powers, privileges, immunities and duties herein conferred upon Trustee; but, nevertheless, upon
the written request of Beneficiary or of the successor substitute trustee, the Trustee shall execute
and deliver an instrument transferring to such successor or substitute trustee all of the estate and
title in the Property of the trustee so ceasing to act, together with all the rights, powers,
privileges, immunities and duties herein conferred upon Trustee, and shall duly assign, transfer
and deliver any of the properties and moneys held by the Trustee hereunder to said successor or
substitute trustee. All references herein to Trustee shall be deemed to refer to any trustee
(including any successor or substitute, appointed and designated, as herein provided) from time
to time acting hereunder. Trustor hereby ratifies and confirms any and all acts that Trustee herein
named or its successor or successors, substitute or substitutes, in this Deed of Trust, shall do
lawfully by virtue hereof.
39. Reconvevance. Upon written request of Beneficiary, stating that all performances
and sums secured hereby have been satisfied and paid, and upon surrender of the Note and this
Deed of Trust to Trustee for cancellation and retention, and upon payment of its fees, Trustee
shall reconvey, without warranty, the Property then held hereunder. The recitals in any
reconveyance executed under this Deed of Trust of any matters or facts shall be conclusive proof
of the truthfulness thereof. The grantee in such reconveyance may be described as "the person or
persons legally entitled thereto."
40. No Releases. The Property shall not be released from the lien of this Deed of
Trust and no person shall be released from liability under the Loan or any other obligation
secured hereby, except in the manner herein specified. Without affecting the liability of any other
person for the payment and performance of any obligation herein mentioned (including Trustor
should it convey said Property) and without affecting the lien or priority hereof upon any
Property not released, Beneficiary may, without notice, release any person so liable, extend the
maturity or modify the terms of any such obligation, grant other indulgences, make future or
other advances to Trustor or anyone or more parties comprising Trustor, assign or in any manner
transfer this Deed of Trust, release or reconvey or cause to be released or reconveyed at any time
all or part of the said Property described herein, take or release any other security or make
compositions or other arrangements with debtors. Beneficiary may also accept additional
security, either concurrently herewith or thereafter, and sell same or otherwise realize thereon,
either before, concurrently with, or after sale hereunder.
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41. Beneficiarv's Consents. At any time, upon written request of Trustor, Trustor's
payment of Beneficiary's fees and presentation of this Deed of Trust (in case of full
reconveyance, for cancellation and retention), without affecting the liability of any person for the
payment of the indebtedness, Beneficiary may: (a) consent to the making of any map or plat of
said Property; (b) join in granting any easement or creating any restriction thereon, (c) join in
any other agreement affecting this Deed of Trust or the lien or charge thereof, and (d) reconvey,
without warranty, all or any part of the Property.
42. Further Assurances. Trustor, from time to time, within fifteen (15) days after
request by Beneficiary, shall execute, acknowledge and deliver to Beneficiary, such chattel
mortgages, security agreements or other similar security instruments, in form and substance
reasonably satisfactory to Beneficiary, covering all property of any kind whatsoever owned by
Trustor or in which Trustor has any interest which, in the reasonable opinion of Beneficiary, is
essential to the operation of the Property covered by this Deed of Trust. Trustor shall further,
from time to time, within fifteen (15) days after request by Beneficiary, execute, acknowledge
and deliver any financing statement, renewal, affidavit, certificate, continuation statement or
other document as Beneficiary may reasonably request in order to perfect, preserve, continue,
extend or maintain the security interest under, and the priority of, this Deed of Trust and the
priority of each such chattel mortgage or other security instrument. Trustor further agrees to pay
to Beneficiary on demand all reasonable costs and expenses incurred by Beneficiary in
connection with the preparation, execution, recording, filing and refiling of any such instrument
or document, including the charges for examining title and the attorneys' fees for rendering an
opinion as to priority of this Deed of Trust and of such chattel mortgage or other security
instrument as a valid and subsisting lien. However, neither a request so made by Beneficiary, nor
the failure of Beneficiary to make such request shall be construed as a release of such Property,
or any part thereof, from the conveyance of title under this Deed of Trust, it being understood
and agreed that this covenant and any such chattel mortgage, security agreement or other similar
security instrument delivered to Beneficiary are cumulative and given as additional security.
43. Time of Performance. Time is of the essence hereof in connection with all
obligations of the Trustor herein and under the Note.
44. Notices. The undersigned Trustor requests that a copy of any Notice of Default or
Notice of Sale hereunder be mailed to it at its address as hereinbefore set forth. Any notices to be
given to Trustor by Beneficiary or Trustee hereunder shall be sufficient, if personally delivered
or mailed, postage prepaid, to the address of the Trustor stated hereinabove, or to such other
address that Trustor has requested in writing to Beneficiary. Any time period provided in the
giving of any notice hereunder shall commence upon the date such notice is delivered or
deposited with the United States Postal Service for delivery by regular first-class postage pre-
paid mail, as officially recorded on the certified mail receipt.
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45. Beneficiary's Right to Inspect. Beneficiary and its agents and representatives may
enter upon the Property at all reasonable times to attend to Beneficiary's interest and to inspect
the Property.
46. Reports and Statements. Trustor shall deliver to Beneficiary, within ninety (90)
days after the end of each of Trustor's fiscal years, and within twenty (20) days after
Beneficiary's request, following an Event of Default, reasonably detailed operating statements
and occupancy reports in a form satisfactory to Beneficiary covering the Property, both certified
as correct by Trustor. At Beneficiary's option, after an Event of Default, such operating
statements shall be prepared by an independent certified public accountant at Trustor's expense.
If Beneficiary so requests, such statements shall specify, in addition to other information
requested by Beneficiary, the rents and profits received from the Property, the disbursements
made for such period, the names of the tenants of the Property and a summary of the terms of the
respective leases or the rental arrangements. Trustor shall permit Beneficiary or its representative
to examine all books and records pertaining to the Property, and shall deliver to Beneficiary all
financial statements, credit reports, and other documents pertaining to the financial condition and
obligations of Trustor and any tenants of the Property, and rental, income, and expense
statements, audits, and tax returns relating to the Property.
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47. Assignment by Beneficiary: Participation. Beneficiary may assign this Deed of
Trust in whole or in part to any person and may grant participations in any of its rights under this
Deed of Trust, without notice and without affecting Trustor's liability under this Deed of Trust.
In connection with any proposed assignment, participation or similar arrangement, Beneficiary
may make available to any person all credit and financial data furnished or to be furnished to
Beneficiary by Trustor. Trustor agrees to provide to the person designated by Beneficiary any
information as such person may reasonably require to form a decision regarding the proposed
assignment, participation or other arrangement. Trustor may not assign this Deed of Trust to any
person at any time, except in connection with a transaction approved in writing by Beneficiary,
under the terms of this Deed of Trust.
48. Modification. This Deed of Trust may be amended, modified, changed or varied
only by a written agreement signed by all of the parties hereto. No requirement of this Deed of
Trust may be waived, at any time, except in a writing signed by Beneficiary and any such waiver
shall be effective only as to its terms and on a single occasion. Neither, Beneficiary's delay or
omission in exercising any right, power or remedy under this Deed of Trust upon default of
Trustor nor Beneficiary's failure to insist upon strict performance of any of the covenants or
agreements contained in this Deed of Trust shall be construed as a waiver of any such right,
power, remedy, covenant or agreement or as an acquiescence in Trustor's breach or default.
49. Successors. Subject to the prohibitions against Trustor's assignments herein, this
Deed of Trust shall inure to the benefit of and bind all of the parties, their successors, estates,
heirs, personal representatives and assigns.
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50. Partial Invaliditv. If a court of competent jurisdiction finally determines that any
provision of this Deed of Trust is invalid or unenforceable, the court's determination shall not
affect the validity or enforceability of the remaining provisions of this Deed of Trust. In such
event, this Deed of Trust shall be construed as if it did not contain the particular provision that
was determined to be invalid or unenforceable. No such determination shall affect any provision
of this Deed of Trust to the extent that it is otheIWise enforceable under the laws of any other
applicable jurisdiction.
5 I. Mutual Negotiation. Beneficiary and Trustor confirm that they have mutually
negotiated this Deed of Trust and that none of the terms or provisions of this Deed of Trust shall
be construed against either party.
52. Paragraph Headings. The paragraph headings in this Deed of Trust are for
convenience only and in no way define, limit, extend, or describe the scope or intent of this Deed
of Trust or any of its provisions.
53. Applicable Law. This Deed of Trust and the rights of the parties hereunder shall
be governed by, construed and enforced in accordance with the laws ofthe State of California.
54. Entire Agreement. This Deed of Trust, the Disposition and Development
Agreement, the Note and the other Transaction Documents, including any exhibits or addenda,
contains the entire agreement of the parties with respect to the subject matter hereof
55. Counterparts. This Deed of Trust may be executed in two or more counterparts,
all of which together shall constitute one and the same instrument and lien. The signature pages
of exact copies of this Deed of Trust may be attached to one copy to form one complete
document. Additional copies of this Deed of Trust may be executed in counterparts and recorded
in two or more counties, all of which shall constitute one and the same instrument and lien.
56. Fixture Filing and Recording. This Deed of Trust constitutes a financing
statement filed as a fixture filing under California Commercial Code Section 9502( c), as
amended or recodified from time to time. This Deed of Trust is to be recorded in the real estate
records of San Bernardino County, California, and covers goods that are, or are to become,
fixtures.
57. Survival of Representations and Warranties. All of Trustor's representations and
warranties contained in this Deed of Trust shall be true and correct at all times during the term of
the Loan secured hereby, until full repayment of the Loan and release and reconveyance of this
Deed of Trust.
(signature page to follow)
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"-- IN WITNESS WHEREOF, Trustor hereby duly executes this Deed of Trust as of the day
and year first above written.
TRUSTOR
[NOTARY JURAT ATTACHED]
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EXHIBIT "A"
LEGAL DESCRIPTION OF PROPERTY
PARCEL I: APN: 0134-081-10
All that portion of Lot I, Block 36, City of San Bernardino, in the City of San Bernardino, County of San
Bernardino, State of California, as per map recorded in Book 7, of maps, records of said County,
described as follows:
Commencing 50 Feet South of the Northeast corner of said Loti; thence South along the East line of said
Lot Ito the Southeast corner thereof; thence West along the South line of said Loti; 140 Feet to a point
159 Feet East of the Southwest Corner of said Loti; Thence North and parallel with the East line of said
LotIto a point which is 50 Feet South of the North line of said Loti, thence East and parallel with the
North line of Lot I, 140 Feet to the point of beginning"
PARCEL 2: APN: 0134-081-23
All that portion of Lot 1, Block 36, City of San Bernardino, in the City of San Bernardino, County of San
Bernardino, State of California, as per map recorded in Book 7, of maps, Page I, records of said County,
described as follows:
Beginning at the Southwest corner of the East 33"5 feet of the West 83"5 feet of said Lot I; thence East
109 feet along the South line of said lotto a point which is 159 feet East of the Southwest corner of said
lot; thence North 150 feet to the North line of said lot; thence West 109 feet to the Northwest corner of
said East 33"5 feet; thence South to the point of beginning"
Except any portion thereof lying within the following described land:
Beginning at the Northeast corner of said Lot I; thence South 50 feet along "0" Street; thence West 140
feet; thence North to the North line of said lot; thence east to the point of beginning"
PARCEL 3: APN: 0134-081-22
A That portion of Lot 1, Block 36, City of San Bernardino, in the City of San Bernardino, County of
San Bernardino, State of California, as per map recorded in Book 7 of maps, Page I, records of said
County, described as follows:
Commencing at the Northeast corner of said Lot I; thence South on the West line of"O" Street, 50 feet;
thence West 140 feet; thence North 50 feet to the North line of said Loti; thence East 140 feet to the
point of beginning"
B" That portion of Lot 8, Block 36, City of San Bernardino, in the City of San Bernardino, County of
San Bernardino, State of California, as per map recorded in Book 7, of maps, Page I, records of said
County, described as follows:
Commencing at the intersection of the South line of Church Street and the West line of"O" Street; thence
South 61 feet, more or less, along the West line of"O" Street to the Northeast corner of Lot I, in said
Block 36; thence West 150 feet; Thpence North 61 feet, more or less, parallel to the West line of"O"
Street to the South line of Church Street; Thence East along the South line of Church Street, to the point
of beginning"
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** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT **
RESOLUTION AGENDA ITEM TRACKING FORM
Meeting Date (Date Adopted): 10 -- ZO~
Vote: Ayes \-'~IS-'l Nays
Change to motion to amend original documents: -
Item# ~\f\
B
Abstain
Resolution #
l' DC- } UlG.3- 33
Absent t.j
e
Reso. # On Attachments:
~
Contract term:
Note on Resolution of Attachment stored separately: --=-
Direct City Clerk to (circle I): PUBLISH, POST, RECORD W/COUNTY
Date Sent to Mayor:
10' 'Z-\-Q'2,
Date of Mayor's Signature: Ii)- Z.~-6:>,
Date of Clerk/CDC Signature: IC)- ?3> ()3,
Dat~~~~r Signature:
60 Day Reminder Letter Sent on 3Uth day:
90 Day Reminder Letter Sent on 45th day:
See Attached:
See Attached:
See Attached:
Request for Council Action & Staff Report Attached:
Updated Prior Resolutions (Other Than Below):
Updated CITY Personnel Folders (6413, 6429, 6433, 10584, 10585, 12634):
Updated CDC Personnel Folders (5557):
Updated Traffic Folders (3985, 8234, 655, 92-389):
Copies Distributed to:
City Attorney
Parks & Rec.
Code Compliance
Dev. Services
Police
Public Services
Water
Notes:
NullNoid After:
By: -
Reso. Log Updated: /
Seal Impressed: .-/'
Date Returned: -
Yes /' No By
Yes NoL- By
Yes No ,/ By
Yes No / By
Yes NOZ B
EDA
/'
MIS
Finance
Others:
BEFORE FILING. REVIEW FORM TO ENSURE ANY NOTATIONS MADE HERE ARE TRANSFERRED TO THE
YEARLY RESOLUTION CHRONOLOGICAL LOG FOR FUTURE REFERENCE IContract Term, etc.)
Ready to File: _
Date:
Revised 01/12/01
** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT **
RESOLUTION AGENDA ITEM TRACKING FORM
Meeting Date (Date Adopted): 10 . 'ZC:>-<:B Item # 1-'2-\ 2, Resolution #
Vote: Ayes \-3 5-'} Nays -8- Abstain .ta-
.
Change to motion to amend original documents:
2D0'3-220
Absent 4
Reso. # On Attachments: - Contract term: -
Note on Resolution of Attachment stored separately: -=-
Direct City Clerk to (circle I): PUBLISH, POST, RECORD W/COUNTY
Date Sent to Mayor: 10-2.\-03
Date of Mayor's Signature: )0-22-0'<,
Date ofClerk/CDC Signature:\O-7':<:-(Y3
Date Me a/Letter Sent for Signature:
60 Day Reminder Letter en
90 Day Reminder Letter Sent on 45th day:
See Attached:
See Attached:
ached:
Request for Council Action & Staff Report Attached:
Updated Prior Resolutions (Other Than Below):
Updated CITY Personnel Folders (6413, 6429, 6433, 10584, 10585, 12634):
Updated CDC Personnel Folders (5557):
Updated Traffic Folders (3985, 8234, 655, 92-389):
Copies Distributed to:
City Attorney /'
Parks & Rec.
Code Compliance
Dev. Services
Police
Public Services
Water
Notes:
NulVVoid After: -
By: ~
Reso. Log Updated: v""
Seal Impressed: v/"
Date Returned: ~.
Yes / No By
Yes No --,..L- By
Yes No -...L By
Yes No~ By
Yes N01 By
EDA
v
Finance
MIS
Others:
BEFORE FILING, REVIEW FORM TO ENSURE ANY NOTATIONS MADE HERE ARE TRANSFERRED TO THE
YEARLY RESOLUTION CHRONOLOGICAL LOG FOR FUTURE REFERENCE (Contract Term. etc.)
Ready to File:_
Date:
Revised 01/12/01