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HomeMy WebLinkAboutJames Eugene Veronin and Dionne Veronin - husband and wife - Trustor - 2011-07-14LSI TITLE COMPANY This Document was electronically recorded by LSI Title Company OFFICIAL BUSINESS Document entitled to free recording per Government Code Sections 6103 and 27383 Recording Requested By: Redevelopment Agency of the City of Huntington Beach 2000 Main Street Recorded in Official Records, Orange County Tom Daly, Clerk -Recorder II�III111111111111I111111111111111111Jill lll11111111111 NO FEE 2011000347025 10:27am 07/18/11 66 406 DI A36 S02 19 0.00 0.00 0.00 0.00 54.00 0.00.0.00 0.00 Huntington Beach, California 92648 Attention: Economic Development Dept./Housing Div. SPACE ABOVE THIS LINE FOR RECORDER'S USE DEED OF TRUST WITH ASSIGNMENTS OF RENTS TO SECURE RESALE RESTRICTIONS ON TRANSFER OF PROPERTY AND TO AMEND RESALE RESTRICTIONS (Cape ) THIS DEED OF TRUST is made this d day o `�` , 20_L�__, by and among James Eugene Veronin and Dionne Veronin, husband Ad xf , whose address is 18916 Coolwater Lane, Huntington Beach, California 92648 (the "Trustor") and the CITY OF HUNTINGTON BEACH, a municipal corporation (the "Trustee") and the REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a public body corporate and politic (the "Beneficiary"), whose address is 2000 Main Street, Huntington Beach, California 92648, with reference to the following facts: A. This Deed of Trust is made in reference to that property in the City of Huntington Beach, County of Orange, State of California, described legally in the Legal Description attached hereto as Exhibit "A" and incorporated herein with the street address 18916 Coolwater Lane, Huntington Beach, California 92648, and the Assessor's Parcel Map No. 933-87-407 (the "Property"). B. The City has adopted an Inclusionary Housing Ordinance (the "Inclusionary Ordinance," currently Section 230.26 of the City Zoning Code). The City has also adopted the Holly- Seacliff Specific Plan, which modifies the Inclusionary Ordinance within Holly-Seacliff. The Property is located within Holly-Seacliff. C. The City has adopted an administrative manual, known as the Affordable Housing Regulations ("Affordable Housing Regulations") to implement the Inclusionary Ordinance and the Holly-Seacliff Specific Plan. D. A "Declaration of Conditions, Covenants and Restrictions for Property" was recorded on March 23, 1999 as Instrument Number 99-214033, in the Office of the County Recorder of the County of Orange, California (the "Resale Restrictions"). Among other things, the Resale Restrictions limit the price that the Property may be sold to an "Affordable Housing Cost" to "Moderate Income Households," as those terms are defined in the Resale Restrictions, and further defined in the Affordable Housing Regulations. The Affordable Housing Regulations, as they may be amended from time to time, are utilized to implement the provisions of the Resale Restrictions. 11-2913/64825 E. Pursuant to this Deed of Trust, the Resale Restrictions are extended to expire thirty (30) years from the date this Deed of Trust is recorded (the "Expiration Date"), which date is approximately June 1, 2041. NOW, THEREFORE, TRUSTOR HEREBY irrevocably grants, transfers and assigns, to Trustee, in trust, with power of sale of the Property, together with (a) all buildings, improvements and fixtures, now or hereafter placed thereon, it being understood and agreed that all classes of property attached or unattached used in connection herewith shall be deemed fixtures, (b) rents, issues and profits thereof, (c) any water rights and/or stock are appurtenant or pertain to said land, and (d) all sums of money payable on the purchase price of the Property secured by a lien thereon or payable under any agreement for the sale thereof, SUBJECT, HOWEVER, to the right, power and authority hereinafter given to and conferred upon Beneficiary to collect and apply such rents, issues and profits, and all sums of money payable on the purchase price of the Property secured by a lien thereon or payable under any agreement. A. FOR THE PURPOSE OF SECURING: 1. Payment of the indebtedness evidenced by a promissory note executed by Trustor on 14 (,(, , 2011_ (the "City Note"). The Amount of the City Note is the "Transfer Prig" of to Property, less the "Affordable Housing Cost." The calculation of the Amount is set forth with specificity in the Note, which is on file with the Economic Development Department of the City of Huntington Beach. 2. Performance of each and every obligation, covenant, promise and agreement of the Resale Restrictions. B. TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR AGREES: 1. Restriction on Resale or Transfer of Property. Trustor agrees for itself, and its successors and assigns, and every successor to Trustor's interest in the Property, or any part thereof that for thirty (30) years from the date this Deed of Trust is recorded (the "Expiration Date"), to perform all obligations due under the Resale Restrictions, as those obligations are amended as set forth in Sections 1 through 13 of this Deed of Trust. The term, "Resale Restrictions," as used hereinafter, shall mean the Resale Restrictions as amended by Sections 1 through 13 of this Deed of Trust. (a) The Property shall only be owned and occupied by persons or families of "Moderate Income." "Moderate Income" shall mean persons or families earning one hundred twenty percent (120%) or less of Orange County median income, adjusted for appropriate family size. (b) The Property may only be sold to "Moderate Income" households at an "Affordable Housing Cost," as those terms are further defined in Affordable Housing Regulations. Generally, those Regulations define Affordable Housing Cost to mean that purchase price which would result in monthly housing payments which do not exceed Thirty -Five Percent (35%) of One Hundred Twenty Percent (120%) of the current Orange County monthly median income for a 2 11-2913/64825 household equal to the number of bedrooms in the unit plus one (1) person. In determining monthly housing payments, the City will assume principal and interest payments on a conventional home mortgage after paying a ten percent (10%) downpayment. The mortgage interest rate will be the prevailing Fannie Mae thirty (30) year mortgage rate, or a City -selected equivalent. Monthly housing costs will also include homeowner's association dues, utilities, homeowner's insurance, maintenance costs and property taxes. The effect of relying on prevailing interest rates to determine the Affordable Housing Cost is to make the resale price of the Property sensitive to interest rates. For example, if interest rates rise, the resale price will fall, and if interest rates fall, the resale price will rise. This could result in the Affordable Housing Cost decreasing below the original purchase price of the Property. (c) The Trustor shall further comply with the Affordable Housing Regulations. (d) No transfer of the Property shall occur until the City of Huntington Beach determines (a) that the proposed purchaser intends to occupy the Property as the proposed purchaser's principal residence, (b) that the proposed purchaser is a person or family of Moderate Income, (c) that the proposed transfer occurs at an Affordable Housing Cost. The City of Huntington Beach shall not be obligated to approve a transfer until and unless the proposed purchaser has submitted to the City of Huntington Beach such information and completed such forms as the City of Huntington Beach shall request to certify the proposed purchaser's intent with respect to its residency of the Property and its gross income, and the proposed purchaser has submitted an affidavit disclosing and certifying the amount of the proposed purchase price. Prior to conveyance of the Property, each approved purchaser shall submit to the City of Huntington Beach an executed disclosure statement which certifies that the purchaser is aware that the purchaser may only sell the unit at an Affordable Housing Cost to a Moderate Income person or family, that the maximum permitted sales price may be less than fair market value and that the unit must be owner -occupied at all times and cannot be rented or leased. TRUSTOR AND EACH SUCCESSOR, HEIR OR ASSIGN OF TRUSTOR UNDERSTANDS THAT THE DETERMINATION OF THE AFFORDABLE HOUSING COST CAN BE MADE ONLY AT THE TIME OF THE PROPOSED TRANSFER, TAKING INTO CONSIDERATION INTEREST RATES, THE TERMS OF SALE OFFERED TO AND THE ECONOMIC CIRCUMSTANCES OF THE PROPOSED PURCHASER AND OTHER FACTORS THAT CANNOT BE ACCURATELY PREDICTED, AND THAT THE TRANSFER PRICE PERMITTED HEREUNDER MAY BE LESS THAN THE FAIR MARKET VALUE OF THE PROPERTY AND MAY NOT INCREASE OR DECREASE IN THE SAME MANNER AS OTHER SIMILAR REAL PROPERTY WHICH IS NOT ENCUMBERED BY THIS RESTRICTION. TRUSTOR AND EACH SUCCESSOR, HEIR OR ASSIGN OF TRUSTOR FURTHER ACKNOWLEDGES THAT AT ALL TIMES IN SETTING THE TRANSFER PRICE THE PRIMARY OBJECTIVE OF THE BENEFICIARY AND THIS DEED OF TRUST IS TO PROVIDE HOUSING TO ELIGIBLE PERSONS OR FAMILIES AT AN AFFORDABLE HOUSING COST. TTrustor Initials rustor Initials 3 11-2913/64825 (e) The City of Huntington Beach may impose any conditions on the approval of any transfer of the Property as it determines are reasonably necessary for the effective administration of its Affordable Housing Program. Such conditions may include, but are not limited to, requiring the prospective purchaser to sign: (i) a promissory note in favor of the City by which he or she agrees to pay any excess proceeds of sale or in excess rental proceeds to the City, (ii) a deed of trust on the Property securing both the Resale Restrictions and the promissory note, and (iii) signing an extension of the Resale Restrictions to no less than thirty (30) years after the close of the transfer to the prospective purchaser. (f) The Trustor shall occupy the Property as the Trustor's principal place of residence. The Owner shall provide an annual written certification to the City that the Trustor is occupying the Property as his or her principal place of residence, and that the Trustor is not renting the Property to another party. (g) The Resale Restrictions shall run with the land and shall automatically terminate and be of no further force or effect thirty (30) years from the date this Deed of Trust is recorded, which date is approximately June 1, 2041, unless further extended as a condition of transfer of the Property. By executing this Deed of Trust the Trustor is extending the term of the Resale Restrictions. 2. Defaults. (a) The following events shall constitute a Default by the Trustor under the Resale Restrictions: (1) The City determines that the Trustor has made a misrepresentation to obtain the benefits of purchase of the Property or in connection with its obligations under the Resale Restrictions; (2) The Trustor fails to owner occupy the Property as required pursuant to Section 1(f) above, and such failure continues following written notice by the City and sixty (60) days opportunity to cure following the date of such notice; (3) The Trustor rents the Property in violation of Section 1(f) above, and such failure continues following written notice by the City and sixty (60) days opportunity to cure; (4) The Trustor fails to provide information to the City necessary to determine Trustor's compliance with the requirements of the Resale Restrictions; (5) The Trustor makes a transfer in violation of the Resale Restrictions; (6) The Trustor otherwise fails to comply with the requirements of the Resale Restrictions, and such violation is not corrected to the satisfaction of the City within thirty (30) days after the date of written notice by the City to the Trustor of such violation; (7) A notice of default is issued under the First Mortgage Loan or other financing secured by the Property; 4 11-2913/64825 (8) A lien is recorded against the Property other than the lien of a bona fide mortgage loan. (9) Trustor places a mortgage on the Property in violation of Section 9 below; or (10) Trustor declares bankruptcy or makes an assignment of assets for the benefit of creditors. (b) Upon a declaration of Default by the City under the Resale Restrictions, the City may exercise any remedies at law or in equity, including without limitation, any or all of the following, none of which shall be an exclusive remedy: (1) Declare the City Note due and payable without further demand and accelerate payments due under the City Note; (2) Invoke the power of sale under this Deed of Trust; (3) Apply to a court of competent jurisdiction for such relief at law or in equity as may be appropriate; (4) Take such enforcement action as is authorized under the Huntington Beach Municipal Code; and (5) Declare a Default under the City Note and this Deed of Trust and pursue all City remedies under the City Note and the City Deed of Trust. Notice of Default and Foreclosure. A request for notice of default and any notice of sale under any deed of trust or mortgage with power of sale encumbering the Property shall be recorded by the City in the Office of the Recorder of the County of Orange. The City may declare a Default under this Resale Agreement upon receipt of any notice given to the City pursuant to Civil Code section 2924b, and may exercise its rights as provided in Sections 2 and 4. In the event of default and foreclosure, the City shall have the same right as the Trustor to cure defaults and redeem the Property prior to the foreclosure sale. Nothing herein shall be construed as creating any obligation of the City to cure any such default, nor shall this right to cure and redeem operate to extend any time limitations in the default provisions of the underlying deed of trust or mortgage. If the City failed to file the request for notice of default, the City's right to purchase the Property shall commence from the date a notice of default is given by the City to the Trustor. 4. Purchase Option Upon Default. Notwithstanding, and in addition to, the remedies provided the City in Section 2, the Trustor hereby grants to the City the option to purchase the Property following written notice by the City to the Trustor of the declaration of a Default by the City under the Resale Restrictions. This 11-2913/64825 option to purchase is given in consideration of the economic benefits received by the Trustor resulting from ownership of the Property made possible by the City's Affordable Housing Program. The City shall have thirty (30) days after a Default is declared to notify the Trustor and the First Lender of its decision to exercise its option to purchase under this Section 4. Not later than ninety (90) days after the notice is given by the City to the Trustor of the City's intent to exercise its option under this Section 4, the City shall purchase the Property for the Affordable Housing Cost calculated in the manner set forth in Section 1. 5. Restrictions on Foreclosure Proceeds. If a creditor acquires title to the Property through a deed in lieu of foreclosure, a trustee's deed upon sale, or otherwise, the Trustor shall not be entitled to the proceeds of sale to the extent that such proceeds otherwise payable to the Trustor when added to the proceeds paid or credited to the creditor exceed the Affordable Housing Cost. The Trustor shall instruct the holder of such excess proceeds .to pay such proceeds to the City in consideration of the benefits received by the City through purchase of the Property under the City's Inclusionary Housing Program. 6. Restrictions on Insurance Proceeds. If the Property is damaged or destroyed and the Trustor elects not to rebuild the Property, the Trustor shall pay the City the portion of any insurance proceeds received by the Trustor for such destruction or damage which is in excess of the Affordable Housing Cost calculated pursuant to Section 2 above. 7. Superiority of Resale Restrictions. The Trustor covenants that he or she shall has not, and will not, execute any other agreement with provisions contradictory to or in opposition to the provisions hereon, and that, in any event, the Resale Restrictions are controlling as to the rights and obligations between and among the Trustor, the City and their respective successors. 8. Subordination. (a) Notwithstanding any provision herein, the Resale Restrictions shall not diminish or affect the rights of the First Lender under the First Lender Deed of Trust or any subsequent First Lender Deeds of trust hereafter recorded against the Property in compliance with the Resale Restrictions. (b) The City may subordinate the Resale Restrictions and this Deed of Trust to the lien of a First Lender Deed of Trust, in which case the Resale Restrictions and this Deed of Trust shall not impair the rights of the First Lender, or such lender's assignee or successor in interest, to exercise its remedies under the First Lender Deed of Trust by the Trustor. Such remedies under the First Lender Deed of Trust include the right of foreclosure or acceptance of a deed or assignment in lieu of foreclosure. After such foreclosure or acceptance of a deed in lieu of foreclosure, the Resale Restrictions and this Deed of Trust shall be forever terminated and shall have no further effect as to the Property or any transferee thereafter; provided, however, if the holder of such First Lender Deed of Trust acquires title to the Property pursuant to a deed or assignment in lieu of foreclosure, the Resale Restrictions and this Deed of Trust shall automatically terminate upon such acquisition of 6 11-2913/64825 title, only if (i) the City has been given written notice of default under such First Lender Deed of Trust with a sixty (60) day cure period, (ii) the City shall not have cured the default within such sixty (60) day period or commenced to cure and given its firm commitment to complete the cure in form and substance acceptable to the first lender, or (iii) the City shall not have exercised its option to purchase the Property pursuant to Section 4 above within such sixty (60) day period and then proceeded diligently to cure the default within sixty (60) days of acquiring title to the Property. 9. Refinance of First Mortgage Loan, Further Encumbrance of Property. Trustor may not refinance of the first mortgage on the Property and/or add a second mortgage on the Property without approval of the City. The City shall only approve refinancing in compliance with the Affordable Housing Regulations. 10. Interpretation of Resale Restrictions. The terms of the Resale Restrictions shall be interpreted so as to avoid speculation on the Property and to ensure to the extent possible that its sales price and mortgage payments remain affordable to Moderate Income Households. 11. Covenants Running; with the Land. (a) Trustor hereby subjects the Property to the covenants and restrictions set forth in the Resale Restrictions. Trustor hereby declares its express intent that the covenants and restrictions set forth in the Resale Restrictions shall be deemed covenants running with the land in perpetuity and shall pass to and be binding upon all parties having any interest in the Property throughout the term of the Resale Restrictions. Each and every contract, deed, lease or other instrument covering, conveying or otherwise transferring the Property or any interest therein, as the case may be, shall conclusively be held to have been executed, delivered and accepted subject to the Resale Restrictions regardless of whether .the other party or parties to such contract have actual knowledge of such Resale Restrictions. (b) The Trustor and the City hereby declare their understanding and intent that: (i) the covenants and restrictions contained in the Resale Restrictions shall be construed as covenants running with the land pursuant to California Civil Code section 1468 and not as conditions which might result in forfeiture of title by Trustor; (ii) the burden of the covenants and restrictions set forth in the Resale Restrictions touch and concern the Property in that the Trustor's legal interest in the Property may be rendered less valuable thereby; and (iii) the benefit of the covenants and restrictions set forth in the Resale Restrictions touch and concern the land by enhancing and increasing the enjoyment and use of the Property by eligible purchasers, the intended beneficiaries of such covenants and restrictions. (c) All covenants and restrictions contained herein in the Resale Restrictions without regard to technical classification or designation shall be binding upon Trustor for the benefit of the City and eligible purchasers and such covenants and restrictions shall run in favor of such parties for the entire period during which such covenants and restrictions shall be in force and effect, without regard to whether the City is the owner of any land or interest therein to which such covenants and restrictions relate. 12. Trustor's Acknowledgement of Resale Restrictions. Trustor hereby acknowledges and agrees that: 7 11-2913/64825 (1) Trustor hereby subjects the Property to certain restrictions and limits the price for which Trustor may sell the Property and the persons to whom Trustor may sell the Property. The Affordable Housing Cost and other provisions contained in the Resale Restrictions restrict the full benefits of owning the Property. Trustor may not enjoy the same economic or other benefits from owning the Property that Trustor would enjoy if the Resale Restrictions did not exist. (2) Absent the provisions of the Inclusionary Housing Ordinance, the Holly- Seacliff Specific Plan, and the provisions of the Resale Restrictions, the Property could not be made available to Moderate Income Households at the Affordable Housing Cost, including Trustor. (3) Trustor understands all of the provisions of the Resale Restrictions. In recognition of the acknowledgments and agreements stated in this Section 12, Trustor accepts and agrees to the provisions of the Resale Restrictions with the understanding that upon the transfer of the Property, the will Resale Restrictions be extended for an additional thirty (30) year term from the date of the transfer, and will remain in full force and effect as to the Property following any transfer of the Property throughout then extended term of the Resale Restrictions. Trustor Initials 13. Non -Discrimination. Trustor 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, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the said property, nor shall Trustor 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, sublessees, or vendees in said property. Trustor and its successors and assigns, shall refrain from restricting the rental or lease (if permitted by Trustor) or sale of said property on the basis of race, color, religion, sex, marital status, national origin or ancestry of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: (a) In deeds: "The grantee herein covenants by and for himself or herself, his or her 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, religion, sex, 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 himself or herself or any person claiming under or through him or her, 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 land herein conveyed. The foregoing covenants shall run with the land." (b) In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: 8 11-2913/64825 "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, religion, sex, marital status, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under to through him or her, 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, sublessees, subtenants or vendees in the premises 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, religion, sex, marital status, ancestry or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, 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 premises." Nothing in this Section 13 shall be construed to authorize the rental or lease of the Property if such rental or lease is not otherwise permitted. The covenants in this paragraph shall run with the land in perpetuity. 14. No violation or breach of the covenants, conditions, restrictions, provisions or limitations contained in this Deed of Trust shall defeat or render invalid or in any way impair the lien or charge of any mortgage or deed of trust or security interest. 15. Upon default by Trustor in the obligations of the City Note, in the performance of any obligation under this Deed of Trust, the Resale Restrictions, or under the terms of any First Lender's Deed of Trust which is or appears to be prior or superior to this Deed of Trust, Beneficiary may declare all sums secured by this Deed of Trust immediately due and payable by delivering to Trustee of a written declaration of default and demand for sale and a written notice of default and election to sell the Property. Default in the payment of any indebtedness secured by this Deed of Trust, in the obligation of the Note, or in the performance of any agreement under this Deed of Trust constitutes a default only under this Deed of Trust and the Note and does not constitute a default under the First Deed of Trust. Trustee shall cause the notice of default to be recorded. Beneficiary also shall deposit with Trustee this Deed of Trust, the Note, and all documents evidencing any additional expenditures secured by this Deed of Trust. After the lapse of such time as then may be required by law following recordation of such notice of default, and notice of sale having been given as then required by law, Trustee, without demand on Trustor, shall sell the Property at the time and place fixed by it in such notice of sale, whether as a whole or in separate parcels, and in such order as it may determine, at public auction to the highest bidder qualified under said Resale Restrictions and this Deed of Trust in lawful money of the United States, payable at time of sale. 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 such purchaser its Deed conveying the Property so sold, but without any covenant or warranty, express or implied. The recital in such Deed of any matters of fact shall be conclusive of the truthfulness thereof. Any person, including Trustor, Trustee, or Beneficiary as hereinafter defined, may purchase at such sale. Trustee may also sell at any such 9 11-2913/64825 sale and as part thereof any shares of corporate stock securing the obligations secured hereby, and Trustor waives demand and notice of such sale. (Beneficiary at its option may also foreclose on such shares by independent pledge sale, and Trustor waives demand and notice of such sale.) After deducting all costs, fees and expenses of Trustee, and of this Trust, including cost of evidence of title in connection with this sale, Trustee shall apply the proceeds of sale to payment, first; all sums expended under the terms hereof, not then repaid, with accrued interest at the rate then payable under the First Lender Deed of Trust secured hereby, and then of all other sums secured hereby, and, if there are any proceeds remaining, shall distribute them to the person or persons legally entitled thereto. 16. Trustor shall keep the Property in good condition and repair; to allow Beneficiary or its representatives to enter and inspect the Property at all reasonable times and access thereto, shall be permitted for that purpose; not to remove or demolish any building thereon; not to make alterations thereto without the consent of the Beneficiary; to suffer or permit no change in the general nature of the occupancy of the Property without Beneficiary's written consent; to complete or restore promptly and in good workmanlike manner any building which may be constructed, damaged or destroyed thereon, including, without restricting the generality of the foregoing, damage from termites and dry - rot; to pay when due all claims for labor performed and materials furnished in connection with the Property and not to permit any mechanic's lien against the Property; to comply with all laws affecting the Property or requiring any alterations or improvements to be made thereon; not to initiate or acquiesce in any zoning reclassification without Beneficiary's written consent; not to commit or permit waste thereon; not to commit, suffer or permit any act upon the Property in violation of the law; to paint, cultivate, irrigate, fertilize, fumigate, prune, and do all other acts that from the character or use of the Property may be reasonably necessary; and to promptly pay all amounts due others upon agreements of lease or conditional sale of all fixtures, furnishings and equipment located thereon. 17. Trustor shall provide, and maintain in force at all times with respect to the Property, fire and other types of insurance as may be required by Beneficiary. All of such insurance shall have a loss payable endorsement in favor of Beneficiary, shall be for a term and in form, content, amount and in such companies as may be satisfactory to Beneficiary, and the policies therefore shall be delivered to and remain in possession of Beneficiary as further security for the faithful performance of these trusts. At least thirty (30) days prior to the expiration of any such insurance policy, a policy or policies renewing or extending such expiring insurance shall be delivered to Beneficiary together with written evidence showing payment of the premium therefore and, in the event any such insurance policy and evidence of the payment of the premium therefore are not so delivered by Trustor to Beneficiary, Trustor by executing this Deed of Trust specifically requests Beneficiary to obtain such insurance and Beneficiary, without obligation to do so, without notice to or demand upon Trustor and without releasing Trustor from any obligation hereof, may obtain such insurance through or from any insurance agency or company acceptable to it, pay the premium thereof, and may add the amount thereof to the indebtedness secured hereby, which amount shall bear a like rate of interest. Beneficiary may furnish to any insurance agency or company, or any other person, any information contained in or extracted from any insurance policy delivered to Beneficiary pursuant hereto and any information concerning the loan secured hereby. Neither Trustee nor Beneficiary shall be responsible for such insurance or for the collection of any insurance monies, or for any insolvency of any insurer or insurance underwriter. In case of insurance loss, Beneficiary is hereby authorized either (a) to settle and adjust any claim under the insurance policies provided for in this document without the consent of the Trustor, or (b) to allow Trustor to agree with the insurance company or companies on the amount to be paid upon the loss. In either case, the Beneficiary is authorized to collect and make receipt of any such insurance money. If Trustor is obligated to restore or replace the damaged or destroyed 10 11-2913/64825 buildings or improvements under the terms of any lease or leases which are or may be prior to the lien of this Deed of Trust and such damage or destruction does not result in cancellation or termination of such lease, such proceeds, after deducting therefrom any expenses incurred in the collection thereof, shall be used to reimburse the Trustor for the cost of rebuilding or restoring the buildings or improvements on said premises. In all other cases, such insurance proceeds shall either be applied for the cost of the rebuilding or restoring the buildings or improvements on said premises. Such buildings and improvements shall be so restored or rebuilt as to be of at least equal value and substantially the same character as prior to the damage or destruction, and shall be in a condition satisfactory to Beneficiary. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. Any and all unexpired insurance shall inure to the benefit of, and pass to the purchaser of, the property conveyed at any Trustee sale held hereunder. 18. Trustor shall pay: (a) at least ten (10) days before delinquency, all general and special City and County taxes, and all assessments on appurtenant water stock, affecting the Property, (b) when done, all special assessments for public improvements, without permitting any improvement bond to issue for any special assessment, (c) when done, all encumbrances, charges and lines, with interest, on the Property, or any part thereof, which are or appears to be prior to superior hereto, (d) if the security of this Deed of Trust is leasehold estate, to make any payment or do any act required of the Lessee or its successor in interest under the terms of the instrument or instruments creating said leasehold, (e) all costs, fees and expenses of this trust, (f) for any statement regarding the obligation secured hereby any amount demanded by Beneficiary not to exceed the maximum allowed by law thereof at the time when such request is made, (g) such other charges for services rendered by Beneficiary and furnished at Trustor's request or that of any successor in interest to Trustor as the Beneficiary may deem reasonable. 19. Should Trustor fail to make any payment or do any act as provided in this Deed of Trust, the Beneficiary or Trustee, but without obligation to do so and without notice to or demand upon Trustor and without releasing Trustor from any obligation hereof, may (a) 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, (b) commence, appear in, or defend any action or proceeding purporting to affect the security hereof or the property covered by this Deed of Trust, or the rights or powers of Beneficiary or Trustee, (c) pay, purchase, contest or compromise any encumbrance, charge or lien, which in the judgment of either is or appears to be prior or superior hereto, and (d) in exercising any such powers, pay necessary expenses, employ counsel and pay his reasonable fees. Trustor agrees to repay any amount so expended on demand of Beneficiary, and any amount so expended may be added by Beneficiary to the indebtedness secured hereby and shall bear a like rate of interest. 20. Trustor shall appear in and defend any action or proceeding purporting to affect the security hereof or the Property which is covered by this Deed of Trust, or the rights or powers of Beneficiary or Trustee, and whether or not Trustor so appears or defends, to pay all costs and expenses, including cost of evidence of title and attorney's fees in a reasonable sum, in any such action or proceeding in which Beneficiary or Trustee may appear by virtue of being made a party defendant or otherwise irrespective of whether the interest of Beneficiary or Trustee in the Property is directly questioned by such action, including any action for the condemnation or partition of said premises, and in any suit brought by Beneficiary to foreclose this Deed of Trust. 11 11-2913/64825 21. Trustor shall pay immediately and without demand, all sums expended under the terms of this Deed of Trust by Beneficiary or Trustee, with interest from the date of expenditure at the rate which the principal obligation secured hereby bears at the time such payment is made, and the repayment of such sums shall be secured hereby. 22. Should Trustor or any successor in interest to Trustor in the Property drill or extract, or enter into a lease for drilling or extraction of oil, gas or other hydrocarbon substances or any mineral of any kind or character, or sell, convey, further encumber, or alienate the Property, or any party thereof, or any interest therein, or be divested of his title or any interest therein in any manner or way, whether voluntarily or involuntarily, Beneficiary shall have the right, at its option, to declare any obligations secured hereby irrespective of the maturity date specified in any Note evidencing the same, immediately due and payable, and no waiver of this right shall be effective unless in writing. 23. Any award, settlement or damages for injury or damages to the Property, or in construction with the transaction financed by such loan, and any award of damages in connection with any condemnation for public use of or injury to the Property, or any part thereof, is hereby assigned and shall be paid to Beneficiary, who may apply or release such monies received by it in such manner and with the same effect as above provided for the disposition of proceeds of fire or other insurance. 24. By accepting payment of any sums secured by this Deed of Trust after its due date, or by making any payment, performing any act on behalf of Trustor, that Trustor was obligated hereunder, but failed, to make, or perform, or by adding any payment so made by Beneficiary to the indebtedness secured hereby, Beneficiary does not waive its right either to require prompt payment when due of all other sums so secured or to declare a default for failure so to pay. 25. At any time, or from time to time, without liability of the Beneficiary or Trustee thereof, and without notice, upon written request of Beneficiary and presentation of this Deed of Trust and the Note secured hereby for endorsement, and without affecting the personal liability of any person for payment of the indebtedness secured hereby, or the lien of the Deed of Trust upon the remainder of the Property for the full amount of the indebtedness then or thereafter secured hereby, or the rights or powers of Beneficiary or the Trustee with respect to the remainder of the Property, Trustee may: (a) reconvey any part of the Property, (b) consent to the making of any map or plat thereof, (c) join in granting any easement thereon, (d) join in any agreement subordinating the lien or charge hereof. 26. The lien hereof shall remain in full force and effect during any postponement or extension of time of payment of the indebtedness secured hereby, or any part thereof. 27. As additional security, Trustor irrevocably assigns to Beneficiary the rents, issues, and profits of the Property for the purposes and upon the terms and conditions set forth below. This assignment shall not impose upon Beneficiary any duty to produce rents from the property affected by this Deed of Trust, or cause Agency to be (a) "mortgages in possession" for any purpose; (b) responsible for performing any of the obligations of the lessor under any lease; or (c) responsible for any waste committed by lessees or any other parties, for any dangerous or defective condition of the property affected by this Deed of Trust, or for any negligence in the management, upkeep, or control of such rights to rents, issues and profits is not contingent upon, and may be exercised without possession of, the property affected by this Deed of Trust. 12 11-2913/64825 Beneficiary confers upon Trustor a license ("License") to collect and retain the rents, issues and profits of the property affected by this Deed of Trust as they become due and payable, until the occurrence of a default hereunder. Upon such default, the License shall be automatically revoked and Beneficiary may collect and retain the rents, issues and profits without notice and without taking possessions of the property affected by this Deed of Trust. 'This right to collect rents, issues and profits shall not grant to Beneficiary or Trustee the right to possession, except as otherwise provided herein; and neither said right, nor termination of the License, shall impose upon Beneficiary or Trustee the duty to produce rents, issues or profits or maintain all or any part of the Property affected by this Trust Deed. If Trustor shall default as aforesaid, Trustor's right to collect any such money shall cease and Beneficiary shall have the right, with or without taking possession of the property affected hereby, to collect all rents, issues, royalties and profits and shall be authorized to, and may, without notice and irrespective of whether declaration of default has been delivered to Trustee and without regard to the adequacy of the security for the indebtedness secured hereby, either personally or by attorney or agent without bringing any action or proceeding, or by receiver to be appointed by the Court, enter into possession and hold, occupy, possess and enjoy the Property, make, cancel, enforce and modify leases, obtain and eject tenants, and set and modify rents and terms of rents, and to sue, and to take, receive and collect all or any part of the said rents, issues, and profits of the property affected hereby, and after paying such costs of maintenance, operation of the Property, and of collection including reasonable attorneys' fees, as in its judgment it may deem proper, to apply the balance upon any indebtedness then secured hereby, the rents, issues, royalties and profits of the Property being hereby assigned to Beneficiary for said purposes. The acceptance of such rents, issues, royalties and profits shall not constitute a waiver of any other right which Trustee or Beneficiary may enjoy under this Deed of Trust or under the laws of California. Failure of or discontinuance by Beneficiary at any time, or from time to time, to collect any such rents, issues, royalties or profits shall not in any manner affect the subsequent enforcement by Beneficiary of the right, power and authority to collect the same. The receipt and application by said Beneficiary of all such rents, issues, royalties and profits pursuant hereto, after execution and delivery of declaration of default and demand for sale as hereinafter provided, or during the pendency of Trustee's sale proceedings hereunder, shall not cure such breach or default nor affect sale proceedings, or any sale made pursuant thereto, but such rents, issues, royalties and profits, less all costs of operation, maintenance, collection and reasonable attorneys' fees, when received by Beneficiary, shall be applied in reduction of the indebtedness secured hereby, from time to time, in such order as Beneficiary may determine. Nothing contained herein, nor the exercise of the right by Beneficiary to collect, shall be, or be construed to be, an affirmation by Beneficiary of any tenancy, lease or option, nor an assumption of liability under, nor subordination of the lien or charge of this Deed of Trust to, any such tenancy, lease or option. 28. If the security of this Deed of Trust is a leasehold estate, the Trustor agrees that: (a) the term "Lease" as used herein shall mean the lease creating the "leasehold estate"' (b) Trustor shall not amend, change or modify his leasehold interest, or the Lease, or agree to do so, without the written consent of the Beneficiary; (c) Trustor will promptly advise Beneficiary regarding any notice, request or demand received by him from the lessor under the Lease and promptly furnish Beneficiary with a copy of any such notice, request or demand; (d) as long as any of the indebtedness secured hereby shall remain unpaid, unless the Beneficiary shall otherwise consent thereto in writing, the leasehold estate shall not merge with the fee title but shall always be kept separate and distinct, notwithstanding the union of said estates in any party; (e) Trustor agrees that it will promptly, strictly, and faithfully perform, fulfill, and comply with all covenants, agreements, terms, conditions and provisions under any lease affecting the premises and to neither do anything, nor to permit anything to be done which may cause modification or termination of any such lease or of the obligations of any lessee or person 13 11-2913/64825 claiming through such lease or the rents provided for therein or the interest of the lessor or the Beneficiary therein or thereunder. Trustor further agrees he will not execute a Deed of Trust or mortgage which may be or become superior to any leasehold estate that is security for this Deed of Trust. In the event of a violation of any of the covenants set forth in this paragraph, Beneficiary shall have the right, at its option, to declare all sums secured hereby immediately due and payable. Consent to or waiver of one of said violations shall not be deemed to be a consent to or waiver of any other violation. If the security for this Deed of Trust is a leasehold estate, the term "property" as used in this Deed of Trust shall be deemed to mean the leasehold estate whenever the context so requires for the protection of the Beneficiary. 29. Trustor waives, to the fullest extent permissible by law, the right to plead any statute of limitations as a defense to any demand secured hereby. 30. Beneficiary may, from time to time, by instrument in writing, substitute a successor or successors to any Trustee named herein or acting hereunder, which instrument, executed and acknowledged by Beneficiary and recorded in the office of the recorder of the county or counties where the Property is situated, shall be conclusive proof of property substitution of such successor Trustee or Trustees, who shall, without conveyances from the Trustee predecessor, succeed to all its title, estate, rights, powers and duties, including but not limited to the power to reconvey the whole or any part of the property covered by this Deed of Trust. Such instrument must contain the name of the original Trustor, Trustee and Beneficiary hereunder, the book and page where this Deed of Trust is recorded. If notice of default shall have been recorded, this power of substitution cannot be exercised until after the costs, fees and expenses of the then acting Trustee shall have been paid to such Trustee, who shall endorse receipt thereof upon such instrument. The procedures herein provided for substitution of Trustee shall not be exclusive of other provisions for substitution provided by law. 31. This Deed of Trust applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns. The term "Beneficiary" shall mean the owner and holder, including pledgee, of the Note secured hereby, whether or not names as Beneficiary herein. In this Deed of Trust, whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular number includes the plural. 32. That in the event of a demand for, and the preparation and delivery of a written statement regarding the obligations secured by this Deed of Trust pursuant to Sections 2943 and 2954 of the Civil Code of California, Beneficiary shall be entitled to make a reasonable charge, not exceeding the maximum amount which is permitted by law at the time the statement is furnished. Beneficiary may also charge Trustor a reasonable fee for any other services rendered to Trustor or rendered in Trustor's behalf in connection with the Property of this Deed of Trust, including changing Beneficiary's records, pertaining to this Deed of Trust in connection with the transfer of the Property, or releasing an existing policy of fire insurance or other casualty insurance held by Beneficiary and replacing the same with another such policy. 33. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. Trustee is not obligated to notify any party hereto of pending sale under any other Deed of Trust or of any action or proceeding in which Trustor, Beneficiary, or Trustee shall be a party unless brought by Trustee. 14 11-2913/64825 34. Any notice which any party hereto may desire or be required to give to the other party shall be in writing. The mailing thereof must be certified mail addressed to the Trustor at his address hereinaeove set forth or to the Beneficiary at his office or at such other place as such parties hereto may designate in writing. THE UNDERSIGNED TRUSTOR REQUESTS that a copy of any notice of default and of any notice of sale hereunder be mailed to him at his address hereinbefore set forth. Dated: 1-?- 1 4 1 / Dated: 17- 14- 11 By: James EuaeneVeronin Dionne V REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BE By: Deputy Executive Director CITY OF HUNTINGTON BE CH By: Director of Economic Develo ent APPROVED AS TO FORM JENNIFER KcGRATH, City Attorney r,t 12v $y Paul D'Alessan&o Assistant City Attorney 15 11-2913/64825 ACKNOWLEDGMENT State of California County of Orange On before me, 44 0-. Michele Ryan, Notary Public (insert name and title of the officer) personally appeare8,QfiUV / VV1,rJ , N 4 ( 7N/'C,e.-- who proved to me on file basis of satisfaEtory evidence to be the person(s) wh?se na e(s) isgrre) subscr' a Ptd o the wit 'in instrument and acknowledged to me that he/she/th y�executed the same in his/he %the authorized capacity(ies), and that by his/her/��.signature(s) on the instrument the perso s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS . an n icial seal. MICHELE RYAN *- COMM. # 1923533 z ® NOTARY PUBLIC - CALIFORNIA ` ORANGE COUNTY Sig\ti re // (Seal) ' My Comm. Expires Feb. 25, 2015 ACKNOWLEDGMENT State of California County of Orange On May 19, 2011 before me, Kathleen Nelson, Notary Public, personally appeared Stanley Smalewitz who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature LIIINIIIIN ININININIINNIIIININININIIIIUNIIIIIINNIIINNNININIIINIIII� a KATHLEEN NELSON COMM. #1814694 z Notary Public - California '$ Orange County M res comm, EiSep 231 , 202=` �mm�n nmmu wnnunnunnN reS n nnmm�lnnn (Seal) ACKNOWLEDGMENT State of California County of Orange On May 19, 2011 before me, Kathleen Nelson, Notary Public, personally appeared Stanley Smalewitz who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature :!5 J / �unmw mnnn�wnmuununwniumwxiw�uuxmwuixmwn�x� KATHLEEN NELSON COMM. #1814694 Notary Public - California c yy Orangpe County s .i'muum nnauiiifium u n uimuxNuiil,nuuun i'iin 3, 201 u? (Seal) R EXHIBIT A LEGAL DESCRIPTION A CONDOMINIUM COMPRISED OF: PARCEL 1: AP # 933-87-407 UNIT 64 OF MODULE "A" IN LOT 1 OF TRACT NO. 15531, IN THE CITY OF HUNTINGTON BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 771, PAGES 26 TO 32 INCLUSIVE OF MISCELLANOUES MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, AS SHOWN AND DEFINED IN THE CONDOMINIUM PLAN OF PHASE 6 RECORDED ON AUGUST 2, 1999 AS INSTRUMENT NO. 1999-0563283 IN THE OFFICIAL RECORDS OF ORANGE COUNTY, CALIFORNIA ("CONDOMINIUM PLAN"), AND AS DEFINED IN THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND RESERVATION OF EASEMENTS FOR CAPE ANN RECORDED ON FEBRUARY 8, 1999 AS INSTRUMENT NO. 1999-0090928 AND RE -RECORDED FEBRUARY 25, 1999 AS INSTRUMENT NO. 1999-0136116, THE "NOTICE OF ANNEXATION OF TERRITORY AND SUPPLEMENTAL DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS FOR PHASE 6 OF CAPE ANN" RECORDED ON AUGUST 2, 1999 AS INSTRUMENT NO. 1999-0563285 BOTH OF SAID OFFICIAL RECORDS (COLLECTIVELY THE "DECLARATION-). EXCEPT THEREFROM ALL OIL, GAS, MIENARLS AND OTHER HYDROCARBONS, BELOW A DEPTH OF 500 FEET, WITHOUT THE RIGHT OF SURFACE ENTRY, AS RESERVED IN INSTRUMENTS OF RECORD. ALSO EXCEPT THEREFROM ALL WATER AND SUBSURFACE WATER RIGHTS, WITHOUT THE RIGHT OF SURFACE ENTRY, BELOW A DEPTH OF 500 FEET, AS DEDICATED OR RESERVED IN INSTRUMENTS OF RECORD. PARCEL 2: A ONE/THIRTEENTH (1/13T") UNDIVIDED FRACTIONAL FEE INTEREST IN AND TO ALL OF THE REAL PROPERTY LOCATED IN THE CITY OF HUNTINGTON BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, DESCRIBED AS MODULE B OF THAT PORTION OF SAID LOT 1 OF SAID TRACT NO. 15531, AS SHOWN AND DEFINED IN THE CONDOMINIUM PLAN (DEFINED ABOVE). PARCEL 3: AN EXCLUSIVE EASEMENT APPURTENANT TO THE AFORE -DESCRIBED CONDOMINIUM UNIT IN, ON, OVER, ACROSS AND THROUGH THE CORPORATION PROPERTY FOR PARKIGN SPACE, IF APPLICABLE, AS MORE PARTICULARLY DESCRIBED IN THE DECLARATION AND SHOWN IN THE CONDOMINIUM PLAN ("EXCLUSIVE USE COMMON AREA"). PARCEL 4: A NON-EXCLUSIVE EASEMENT APPURTENANT TO THE AFORE -DESCRIBED CONDOMINIUM UNIT FOR INGRESS, EGRESS, USE, MAINTENANCE REPAIR, DRAINAGE, ENCROACHMENT, AND ENJOYMENT AND OTHER PURPOSES IN, ON, OVER, UNDER, ACROSS AND THROUGH ALL PORTIONS OF THE CORPORATION PROPERTY OF THE PROJECT, EXCEPT THEREFROM ALL PORTIONS DESCRIBED THEREIN AND SHOWN IN THE CONDOMINIUM PLAN AS EXCLUSIVE USE COMMON AREA, IF ANY, AND ACROSS ALL PORTIONS OF AND CORPORATION PROPERTY SUBSEQUENTLY ANNEXED INTO THE PROJECT WHICH IS NOT DESCRIBED AS EXCLUSIVE USE COMMON AREA. PARCEL 5: NON-EXCLUSIVE EASEMENTS FOR ACCESS, INGRESS, EGRESS, MAINTENANCE, REPAIR, DRAINAGE, ENCROACHMENT, SUPPORT AND FOR OTHER PURPOSES, ALL AS DESCRIBED IN THAT CERTAIN "DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND RESERVATION OF EASEMENTS FOR THE SEAGATE COMMUNITY" RECORDED ON JULY 31, 1997 AS INSTRUMENT NO. 1997-0365470, IN THE OFFICE OF THE COUNTY RECORDER, AS SUCH COMMUNITY DECLARATION MAY BE AMENDED, FROM TIME TO TIME (THE "COMMUNITY DECLARATION-). PARCEL 6: A NON-EXCLUSIVE EASEMENT FOR YARD, DRAINAGE, LANDSCAPE, IRRIGATION, UTILITIES, ENCROACHMENT, INGRESS, EGRESS AND ACCESS PURPOSES, IF APPLICABLE, AS DESCRIBED AND DEPICTED IN THE DECLARATION.