18708408-v3
WHEN RECORDED MAIL TO:
Citibank, N.A.
Transaction and Asset Management Group/Post Closing
Citi Community Capital
8800 Hidden River Parkway
Tampa, Florida 33637
Re: Nevin Apartments Deal ID No. 23913
SUBORDINATION AND INTERCREDITOR AGREEMENT
(Fee Deferral)
Subordination and Intercreditor Agreement (Fee Deferral) Nevin Apartments
SUBORDINATION AND INTERCREDITOR AGREEMENT
THIS SUBORDINATION AND INTERCREDITOR AGREEMENT (this
“Agreement”) dated as of June 30, 2022, is made by and between the CITY OF RICHMOND, a California municipal corporation (“Junior Lender ”), and CITIBANK, N. A., a national banking association (“Senior Lender ”) and acknowledged by RICHMOND NEVIN ASSOCIATES, A CALIFORNIA LIMITED PARTNERSHIP , a California limited partnership (“Borrower”).
RECITALS:
A. Borrower applied to the County of Contra Costa, California, a political subdivision and body corporate and politic of the State of California (“Governmental Lender”), for a loan (the “ Senior Loan ”) for the acquisition, construction, rehabilitation, development, equipping and/or operation of a 271 -unit multifamily res idential project located in the City of Richmond, Contra Costa County, California , known or to be known as Nevin Apartments (the “Property”).
B. The Senior Loan is evidenced by that certain Multifamily Note, dated as of the Closing Date (as defined in the B orrower Loan Agreement) , in the maximum p rincipal amount of $85,000,000 made by Borrower payable to the order of Governmental Lender ( as the same may from time to time be extended, consolidated, substituted for, modified, increased, amended and supplemented, the “Senior Note”) and that certain Borrower Loan Agreement, dated as of December 1, 2017 , by and between Borrower and Governmental Lender (the “ Borrower Loan Agreement”).
C. The Senior Loan is secured by, among other things, that certain Multifamily Deed of Trust, Assignment of R ents, Security Agreement and Fixture Filing , dated as of December 1, 2017, executed by Borrower for the benefit of Governmental Lender (as the same may from time to time be extended, consolidated, substituted for, modified, increas ed, amended and supplemented, “Senior Security Instrument”), which Senior Security Instrument recorded on December 21, 2017 in Contra Costa County, California (“Official Records”), as Instrument No. 2017-9023992400076, encumbers the Property.
D. Borrower requ ested that Senior Lender enter into that certain Funding Loan Agreement, dated as of December 1, 2017 , by and between Governmental Lender and Senior Lender, pursuant to which Senior Lender made a loan to Governmental Lender (the “ Funding Loan”), the proceeds of which were used to make the Senior Loan to Borrower pursuant to the Borrower Loan Agreement.
E. The Senior Note, the Senior Security Instrument and the Borrower Loan Agreement have each been assigned by Governmental Lender to Senior Lender to secure the Funding Loan as evidenced by that certain Assignment of Deed of Trust and Loan Documents, dated as of December 1, 2017, given by Governmental Lender to Senior Lender (the “ Senior Security Instrument Assignment”), which Senior Security Instrument Assignmen t recorded on
Subordination and Intercreditor Agreement (Fee Deferral) 2 Nevin Apartments December 21, 2017 in the Official Records as Instrument No. 2017 -902399250007. The Borrower and Senior Lender have entered into that certain Construction Funding Agreement dated as of December 1, 2017 (the “Construction Funding Agreement”) regarding the manner in which the improvements at the Property will be completed and paid for.
F. Junior Lender made a loan (the “ Junior Loan ”) to Borrower in the original principal amount of $500,000 , which Junior Loa n is evidenced by a certain Fee Deferral L oan Note dated as of December 20, 2017, made by Borrower to Junior Lender (the “ Junior Note”) and secured by, the Junior Security Instrument (as hereinafter defined) encumbering the Property, and will be advanced to Borrower pursuant to that certain Fee De ferral Loan Agreement between Borrower and Junior Lender dated December 20, 2017 (the “Junior Loan Agreement”).
G. As a condition to the making of the Senior Loan, Senior Lender requires that Junior Lender execute and deliver this Agreement prior to the makin g of the Junior Loan and the granting of the Junior Security Instrument by Borrower.
NOW, THEREFORE, for Ten Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and to induce the making of the Senior Loan and to induce Senior Lender to consent to the Junior Loan and the Junior Security Instrument, Junior Lender hereby agrees as follows:
1. Definitions. Capitalized terms used but not defined in this Agreement shall have the meanings ascribed thereto in the Senior Security Instrument. As used in this Agreement, the terms set forth below shall have the respective meanings indicated:
“Bankruptcy Proceeding ” means any bankruptcy, reorganization, insolvency, composition, restructuring, dissolutio n, liquidation, receivership, assignment for the benefit of creditors, or custodianship action or proceeding under any federal or state law with respect to Borrower, any guarantor of any of the Senior Indebtedness, any of their respective properties, or any of their respective partners, members, officers, directors, or shareholders. “Casualty” means the occurrence of damage to or loss of any of the Property by fire or other casualty.
“Condemnation” means any proposed or actual condemnation or other taking, or conveyance in lieu thereof, of all or any part of the Property, whether direct or indirect. “Enforcement Action” means any exercise of any of Junior Lender’s remedies under the Junior Security Instrument or any of the other Junior Loan Documents, includ ing, without limitation, any of the following: (i) the acceleration of all or any part of the Junior Indebtedness, (ii) the commencement of any ju dicial or non -judicial action or proceeding to enforce any obligation of Borrower under any of the Junior Loan Documents, collect any monies payable to Borrower or have a receiver appointed to collect any monies payable to Borrower, or foreclose the lien(s) created by the Junior Security Instrument, (iii) the filing or joining in the filing of any involuntary Bank ruptcy Proceeding against Borrower or any person or entity which owns a direct or indirect interest in Borrower, (iv) the advertising of or commencement of any foreclosure or trustee’s sale proceedings, (v) the exercise of any power of sale, (vi) the
Subordination and Intercreditor Agreement (Fee Deferral) 3 Nevin Apartments acceptance of a deed or assignment in lieu of foreclosure or sale, (vii) the collecting of Rents, (viii) the obtaining of or seeking of the appointment of a receiver, (ix) the seeking of default interest, (x) the taking of possession or control of any of the Pr operty, (xi) the commencement of any suit or other legal, administrative, or arbitration proceeding based upon the Junior Note or any other of the Junior Loan Documents, (xii) the exercising of any banker’s lien or rights of set- off or recoupment, or (xiii ) the taking of any other enforcement action against Borrower, any other party liable for any of the Junior Indebtedness or obligated under any of the Junior Loan Documents, or the Property.
“Enforcement Action Notice ” means a written notice from Junior Le nder to Senior Lender, given following a Junior Loan Default and the expiration of any notice or cure periods provided for such Junior Loan Default in the Junior Loan Documents, setting forth in reasonable detail the Enforcement Action proposed to be taken by Junior Lender. “Junior Indebtedness ” means all indebtedness of any kind at any time evidenced or secured by, or arising under, the Junior Loan Documents, whether incurred, arising or accruing before or after the filing of any Bankruptcy Proceeding. “Junior Loan Default ” means any act, failure to act, event, condition, or occurrence which constitutes, or which with the giving of notice or the passage of time, or both, would constitute, an “Event of Default” as defined in the Junior Security Instrument. “Junior Loan Documents ” means, collectively, the Junior Note, the Junior Security Instrument, the Junior Loan Agreement and all other documents evidencing, securing or delivered in connection with the Junior Loan, all of which are listed on Exhibit B attach ed hereto, together with such modifications, amendments and supplements thereto as are approved in writing by Senior Lender prior to their execution.
“Junior Security Instrument ” means that certain Deed of Trust and Security Agreement, dated as of December 20, 2017, made by Borrower for the benefit of Junior Lender, recorded in the Official Records on August 9, 2018 as Instrument No. 2018 -0127118-00, as the same may from time to time be extended, consolidated, substituted for, modified, amended or supplemented upon receipt of the consent of Senior Lender.
“Loan Agreement” means that certain Construction Funding Agreement, dated as of the date hereof, by and between Borrower and Senior Lender relating to the Senior Loan. “Loss Proceeds” means all monies received or to be received under any insurance policy, from any condemning authority, or from any other source, as a result of any Condemnation or Casualty.
“Property” means (i) the land and improvements known or to be known as Nevin Apartments, located in Rich mond, Contra Costa County, State of California , which Property is more particularly described on Exhibit A attached hereto, and (ii) all furniture, fixtures and equipment located at such apartments and other property, accounts, deposits and rights and interests of Borrower encumbered by the Senior Security Instrument and/or the other Senior Loan Documents.
Subordination and Intercreditor Agreement (Fee Deferral) 4 Nevin Apartments “Senior Indebtedness ” means all indebtedness of any kind at any time evidenced or secured by, or arising under, the Senior Loan Documents, whether incurr ed, arising or accruing before or after the filing of any Bankruptcy Proceeding. “Senior Loan Default ” means any act, failure to act, event, condition, or occurrence which constitutes, or which with the giving of notice or the passage of time, or both, wou ld constitute, an “Event of Default” as defined in the Senior Security Instrument. “Senior Loan Documents” means, collectively, the Senior Security Instrument, the Senior Note, the Borrower Loan Agreement , the Senior Security Instrument Assignment, the Loa n Agreement, and all of the other documents, instruments and agreements now or hereafter evidencing, securing or otherwise executed in connection with the Senior Loan, as the same may from time to time be extended, consolidated, substituted for, modified, increased, amended and supplemented in accordance with the provisions of this Agreement.
2. Junior Loan and Junior Loan Documents are Subordinate; Acts by Senior Lender do not Affect Subordination.
(a) Junior Lender hereby covenants and agrees on behalf of itself and its successors and permitted assigns that the Junior Indebtedness is and shall at all times continue to be, subordinate, subject and inferior (in payment and priority) to the prior payment in full of the Senior Indebtedness, and that the liens, rights , payment interests, priority interests and security interests granted to Junior Lender in connection with the Junior Loan and under the Junior Loan Documents are, and are hereby expressly acknowledged to be in all respects and at all times, subject, subor dinate and inferior in all respects to the liens, rights, payment, priority and security interests granted to Senior Lender under the Senior Loan and the Senior Loan Documents and the terms, covenants, conditions, operations and effects thereof.
(b) Except as expressly set forth herein, repayment of the Junior Indebtedness, is and shall be postponed and subordinated to repayment in full of the Senior Loan. Prior to a Senior Loan Default (regardless of whether such Senior Loan Default occurs prior to or during the pendency of a Bankruptcy Proceeding), Junior Lender shall be entitled to receive and retain payments made pursuant to and in accordance with the terms of the Junior Loan Documents; provided, however, that no such payment is made more than ten (10) days in advance of the due date thereof. Junior Lender agrees that from and after such time as it has received from either Senior Lender or Borrower written notice that a Senior Loan Default then exists (which has not been expressly waived in writing by Senior Lender) or otherwise has actual knowledge of such a Senior Loan Default, Junior Lender shall not receive or accept any payments under the Junior Loan. If (i) Junior Lender receives any payment, property, or asset of any kind or in any form on account of the Junior Indebtedness (including, without limitation, any proceeds from any Enforcement Action) after a Senior Loan Default of which Junior Lender has actual knowledge or has been given notice of, or (ii) Junior Lender receives, voluntarily or involuntarily, by operation of law or otherwise, any payment, property, or asset in or in connection with any Bankruptcy Proceeding, such payment, property, or asset will be received and held in trust for Senior Lender. Junior Lender will promptly remit, in kind
Subordination and Intercreditor Agreement (Fee Deferral) 5 Nevin Apartments and properly endorsed as necessary, all such payments, properties, and assets to Senior Lender. Senior Lender shall apply any payment, asset, or property so received from Junior Lender to the Senior Indebtedness in such order, amount (with respect to any a sset or property other than immediately available funds), and manner as Senior Lender shall determine in its sole and absolute discretion.
(c) Without limiting the complete subordination of the Junior Indebtedness to the payment in full of the Senior Indebtedn ess, in any Bankruptcy Proceeding, upon any payment or distribution (whether in cash, property, securities, or otherwise) to creditors (i) the Senior Indebtedness shall first be paid in full in cash before Junior Lender shall be entitled to receive any pay ment or other distribution on account of or in respect of the Junior Indebtedness, and (ii) until all of the Senior Indebtedness is paid in full in cash, any payment or distribution to which Junior Lender would be entitled but for this Agreement (whether in cash, property, or other assets) shall be made to Senior Lender. (d) The subordination of the Junior Indebtedness shall continue in the event that any payment under the Senior Loan Documents (whether by or on behalf of Borrower, as proceeds of security or en forcement of any right of set -off or otherwise) is for any reason repaid or returned to Borrower or its insolvent estate, or avoided, set aside or required to be paid to Borrower, a trustee, receiver or other similar party under any bankruptcy, insolvency, receivership or similar law. In such event, the Senior Indebtedness or part thereof originally intended to be satisfied shall be deemed to be reinstated and outstanding to the extent of any repayment, return, or other action, as if such payment on account of the Senior Indebtedness had not been made. (e) The subordination of the Junior Loan Documents and of the Junior Indebtedness shall apply and continue notwithstanding (i) the actual date and time of execution, delivery, recording, filing or perfection of t he Senior Security Instrument and other Senior Loan Documents and of the Junior Security Instrument and other Junior Loan Documents, and (ii) the availability of any collateral to Senior Lender, including the availability of any collateral other than the Property. (f) By reason of, and without in any way limiting, the full subordination of the Junior Indebtedness and the Junior Loan Documents provided for in this Agreement, all rights and claims of Junior Lender under the Junior Security Instrument or under the Junior Loan Documents in or to the Property or any portion thereof, the proceeds thereof, the Leases thereof, the Rents, issues and profits therefrom, and the Loss Proceeds payable with respect thereto, are expressly subject and subordinate in all respect s to the rights and claims of Senior Lender under the Senior Loan Documents in and to the Property or any portion thereof, the proceeds thereof, the Leases thereof, the Rents, issues and profits therefrom, and the Loss Proceeds payable with respect thereto. (g) If Junior Lender, by indemnification, subrogation or otherwise, shall acquire any lien, estate, right or other interest in any of the Property, that lien, estate, right or other interest shall be fully subject and subordinate to the receipt by Senior Lender of payment in full of the Senior Indebtedness, and to the Senior Loan Documents,
Subordination and Intercreditor Agreement (Fee Deferral) 6 Nevin Apartments to the same extent as the Junior Indebtedness and the Junior Loan Documents are subordinate pursuant to this Agreement.
(h) Reserved.
(i) Junior Lender hereby acknowledges and agr ees that Senior Lender may, without the consent or approval of Junior Lender, agree with Borrower to extend, consolidate, modify, increase or amend any or all the Senior Loan Documents and otherwise act or fail to act with respect to any matter set forth i n any Senior Loan Document (including, without limitation, the exercise of any rights or remedies, waiver, forbearance or delay in enforcing any rights or remedies, the declaration of acceleration, the declaration of defaults or events of default, the rele ase, in whole or in part, of any collateral or other property, and any consent, approval or waiver), and all such extensions, consolidations, modifications, amendments acts and omissions shall not release, impair or otherwise affect Junior Lender’s obligations and agreements hereunder.
3. Junior Lender Agreements.
(a) Without the prior written consent of Senior Lender in each instance, Junior Lender shall not (i) amend, modify, waive, extend, renew or replace any provision of any of the Junior Loan Documents, or ( ii) pledge, assign, transfer, convey, or sell any interest in the Junior Indebtedness or any of the Junior Loan Documents; or (iii) accept any payment on account of the Junior Indebtedness other than a regularly scheduled payment of interest or principal a nd interest made not earlier than ten (10) days prior to the due date thereof; or (iv) take any action which has the effect of increasing the Junior Indebtedness; or (v) appear in, defend or bring any action in connection with the Property; or (vi) take any action concerning environmental matters affecting the Property.
Regardless of any contrary provision in the Junior Loan Documents, Junior Lender shall not collect payments for the purpose of escrowing for any cost or expense related to the Property or for any portion of the Junior Indebtedness. (b) Junior Lender hereby agrees that Senior Lender may, at its option (but without any obligation to do so), at any time (including during the pendency of a Bankruptcy Proceeding), purchase the Junior Loan at par (and without liability for any prepayment premiums or liquidated damages set forth in the Junior Loan Documents).
Such transfer and assignment of the Junior Loan shall be without representation or recourse, except that Junior Lender shall represent that it is t he sole holder of the Junior Loan, that it has authority to assign and convey the Junior Loan Documents, that, to the best of its knowledge, there are no defaults or breaches under the Junior Loan Documents, and as to the total amount then outstanding unde r the Junior Loan. . Junior Lender shall give Senior Lender a concurrent copy of each notice of a Junior Loan Default, Enforcement Action Notice or other material notice given by Junior Lender under the Junior Loan Documents. Notwithstanding any contrary p rovision in the Jun ior Loan Documents, Senior Lender shall have the right, but shall not have any obligation, to cure any Junior Loan Default until ninety (90) days following Senior Lender’s receipt of an Enforcement Action Notice given by Junior Lender as a consequence of the Junior Loan Default. Senior Lender shall not be subrogated to the rights of Junior Lender under
Subordination and Intercreditor Agreement (Fee Deferral) 7 Nevin Apartments the Junior Loan Documents by reason of Senior Lender having cured any Junior Loan Default. However, Junior Lender acknowledges that all amounts advanced or expended by Senior Lender to cure a Junior Loan Default shall be added to and become a part of the Senior Indebtedness pursuant to the terms of the Senior Security Instrument. (c) In the event and to the extent that each of Senior Lender and Junior Lender have under their respective loan documents certain approval or consent rights over the same subject matters (regardless of whether the obligations or rights are identical or substantially identical), Junior Lender agrees that Senior Lender shall exercise such approval rights on behalf of both Senior Lender and Junior Lender, and Junior Lender shall have no right to object to any such action or approval taken by Senior Lender and shall consent thereto and be bound thereby. Without limiting t he generality of the foregoing, Senior Lender shall have all approval, consent and oversight rights in connection with any insurance claims relating to the Property, any decisions regarding the use of insurance proceeds after a casualty loss or condemnatio n awards, the hiring or firing of property managers, or otherwise related in any way to the Property, and Junior Lender shall have no right to object to any such action or approval taken by Senior Lender and shall consent thereto and be bound thereby.
(d) Junior Lender agrees that in any action commenced to enforce the obligation of Borrower to pay any portion of the Junior Indebtedness, the judgment shall not be enforceable personally against Borrower or Borrower’s assets, and the recourse of Junior Lender for the collection of the Junior Indebtedness shall be limited to actions against the Property and the rents, profits, issues, products, and income from the Property.
(e) Junior Lender shall not commence or join with any other creditor in commencing any Bankruptc y Proceeding involving Borrower, and Junior Lender shall not initiate and shall not be a party to any action, motion or request, in a Bankruptcy Proceeding involving any other person or entity, which seeks the consolidation of some or all of the assets of Borrower into such Bankruptcy Proceeding. In the event of any Bankruptcy Proceeding relating to Borrower or the Property or, in the event of any Bankruptcy Proceeding relating to any other person or entity into which (notwithstanding the covenant in the f irst sentence of this clause) the assets or interests of Borrower are consolidated, then in either event, the Senior Loan shall first be paid in full before Junior Lender shall be entitled to receive and retain any payment or distribution in respect to the Junior Loan. Junior Lender agrees that (i) Senior Lender shall receive all payments and distributions of every kind or character in respect of the Junior Loan to which Junior Lender would otherwise be entitled, but for the subordination provisions of thi s Agreement (including without limitation, any payments or distributions during the pendency of a Bankruptcy Proceeding involving Borrower or the Property), and (ii) the subordination of the Junior Loan and the Junior Loan Documents shall not be affected i n any way by Senior Lender electing, under Section 1111(b) of the federal bankruptcy code, to have its claim treated as being a fully secured claim. In addition, Junior Lender hereby covenants and agrees that, in connection with a Bankruptcy Proceeding in volving Borrower, neither Junior Lender nor any of its affiliates shall (i) make or participate in a loan facility to or for the benefit of Borrower on a basis that is senior to or pari passu with
Subordination and Intercreditor Agreement (Fee Deferral) 8 Nevin Apartments the liens and interests held by Senior Lender pursuant to t he Senior Loan Documents, (ii) not vote affirmatively in favor of any plan of reorganization or liquidation unless Senior Lender has also voted affirmatively in favor of such plan, and (iii) not contest the continued accrual of interest on the Senior Indeb tedness, in accordance with and at the rates specified in the Senior Loan Documents, both for periods before and for periods after the commencement of such Bankruptcy Proceedings. Junior Lender shall execute and deliver to Senior Lender powers of attorney, assignments or other instruments as may be requested by Senior Lender in order to enable it to exercise the above -described authority or powers with respect to any or all of the Junior Loan Documents, and to collect and receive any and all payments or di stributions which may be payable or deliverable at any time upon or with respect to any of the Junior L oan Documents to Junior Lender.
(f) Junior Lender covenants and agrees that the effectiveness of this Agreement and the rights of Senior Lender hereunder sha ll be in no way impaired, affected, diminished or released by any renewal or extension of the time of payment of the Senior Loan, by any delay, forbearance, failure, neglect or refusal of Senior Lender in enforcing payment thereof or in enforcing the lien of or attempting to realize upon the Senior Loan Documents or any other security which may have been given or may hereafter be given for the Senior Loan, by any waiver or failure to exercise any right or remedy under the Senior Loan Documents, or by any ot her act or failure to act by Senior Lender. Junior Lender acknowledges that Senior Lender, at its sole option, may release all or any portion of the Property from the lien of the Senior Security Instrument, and may release or waive any guaranty, surety or indemnity providing additional collateral to Senior Lender, and Junior Lender hereby waives any legal or equitable right in respect of marshaling it might have, in connection with any release of all or any portion of the Property by Senior Lender, to requ ire the separate sales of any portion of the Property or to require Senior Lender to exhaust its remedies against any portion of the Property or any other collateral before proceeding against any other portion of the Property or other collateral (including guarantees) for the Senior Loan. Senior Lender may pursue all rights and remedies available to it under the Senior Loan Documents, at law, or in equity, regardless of any Enforcement Action Notice or Enforcement Action by Junior Lender.
At any time or fr om time to time and any number of times, without notice to Junior Lender and without affecting the liability of Junior Lender, (a) the time for payment of the Senior Indebtedness may be extended or the Senior Indebtedness may be renewed in whole or in part ; (b) the time for Borrower’s performance of or compliance with any covenant or agreement contained in the Senior Loan Documents, whether presently existing or hereinafter entered into, may be extended or such performance or compliance may be waived; (c) t he maturity of the Senior Indebtedness may be accelerated as provided in the Senior Loan Documents; (d) any Senior Loan Document may be extended, consolidated, modified or amended by Senior Lender and Borrower in any respect, including, but not limited to, an increase in the principal amount; and (e) any security for the Senior Indebtedness may be modified, exchanged, surrendered or otherwise dealt with or additional security may be pledged or mortgaged for the Senior Indebtedness. If, after the occurrence of a Senior Loan Default, Senior Lender acquires title to any of the Property pursuant to a mortgage foreclosure conducted in accordance with applicable law, the lien, operation, and effect of the Junior Security Instrument and
Subordination and Intercreditor Agreement (Fee Deferral) 9 Nevin Apartments other Junior Loan Documents automatically shall terminate with respect to such Property upon Senior Lender’s acquisition of title.
(g) Junior Lender acknowledges that it entered into the transactions contemplated by the Junior Loan Documents and made the Junior Loan to Borrower without reliance upon any information or advice from Senior Lender. Junior Lender made its own underwriting analysis in connection with the Junior Loan, its own credit review of Borrower, and investigated all matters pertinent, in Junior Lender’s judgment, to its determination to make the Junior Loan to Borrower. Junior Lender acknowledges that it is a sophisticated, experienced commercial lender, and was represented by competent counsel in connection with this Agreement.
(h) Junior Lender hereby further represents a nd warrants that: (i) Junior Lender is now the owner and holder of the Junior Loan Documents; (ii) the Junior Loan Documents are now in full force and effect; (iii) the Junior Loan Documents have not been modified or amended; (iv) no default or event which , with the passing of time or giving of notice would constitute a default, under the Junior Loan Documents has occurred; (v) the current outstanding principal balance of the Junior Indebtedness is $500,000; (vi) no scheduled monthly payments under the Juni or Loan Documents have been or will be prepaid except with the prior written consent of Senior Lender; (vii) none of the rights of Junior Lender under any of the Junior Loan Documents are subject to the rights of any third parties, by way of subrogation, indemnification or otherwise; and (viii) there are no other Junior Loan Documents other than those listed on Exhibit B hereto.
Borrower further represents and warrants that it has provided to Senior Lender a true, complete, and correct copy of all the Junior Loan Documents. (i) Reserved.
4. Standstill Agreement; Right to Cure Senior Loan Default. (a) Until such time as any of the Senior Indebtedness has been repaid in full and the Senior Security Instrument has been released and discharged, Junior Lender shall not without the prior written consent of Senior Lender, which may be withheld in Senior Lender’s sole and absolute discretion, take any Enforcement Action, including, without limitation, (i) accelerate the Junior Loan, (ii) exercise any of Junior Lender’s remedie s under the Junior Security Instrument or any of the other Junior Loan Documents (including, without limitation, the commencement of any judicial or non -judicial action of proceeding (a) to enforce any obligation of Borrower under any of the Junior Loan Documents, (b) to collect any monies payable to Borrower, (c) to have a receiver appointed to collect any monies payable to Borrower; or (d) to foreclose the lien(s) created by the Junior Security Instrument) or (iii) file or join in the filing of any involuntary Bankruptcy Proceeding against Borrower or any person or entity which owns a direct or indirect interest in Borrower; provided, however, that such limitation on the remedies of Junior Lender shall not derogate or otherwise limit Junior Lender’s rights , following an event of default under the Junior Loan Documents to (a) compute interest on all amounts due and payable under the Junior Loan at the default rate described in the Junior Loan Documents, (b) compute prepayment premiums and late charges, and ( c)
Subordination and Intercreditor Agreement (Fee Deferral) 10 Nevin Apartments enforce against any person, other than Borrower and any guarantors or indemnitors under the Senior Loan Documents, any guaranty of the obligations of Borrower under the Junior Loan.
(b) Senior Lender shall, simultaneously with the sending of any notice of a Senior Loan Default to Borrower, send to Junior Lender a copy of said notice under the Senior Loan Documents; provided, however, failure to do so shall not affect the validity of such notice or any obligation of Borrower to Senior Lender and shall not aff ect the relative priorities between the Senior Loan and the Junior Loan as set forth herein.
Borrower covenants and agrees to forward to Junior Lender, within three (3) business days of Borrower’s receipt thereof, a copy of any notice of a Senior Loan Def ault Borrower receives from Senior Lender.
(c) Junior Lender shall have the right, but shall have no obligation, to cure any Senior Loan Default; provided, if Junior Lender shall elect to cure any such Default, it shall so notify Senior Lender and shall commence and complete such curing within any applicable notice or grace period, if any, as Borrower is permitted by the terms of the Senior Loan Documents to cure such Senior Loan Default. Junior Lender shall not be subrogated to the rights of Senior Lender und er the Senior Loan Documents by reason of Junior Lender having cured any Senior Loan Default. However, Senior Lender acknowledges that, to the extent so provided in the Junior Loan Documents, amounts advanced or expended by Junior Lender to cure a Senior Loan Default may be added to and become a part of the Junior Indebtedness.
(d) Junior Lender agrees that, notwithstanding any contrary provision contained in the Junior Loan Documents, a Senior Loan Default shall not constitute a default under the Junior Loan Documents if no other default occurred under the Junior Loan Documents.
(e) Junior Lender acknowledges that any conveyance or other transfer of title to the Property pursuant to a foreclosure of the Junior Security Instrument (including a conveyance or other transfer of title pursuant to the exercise of a power of sale contained in the Junior Security Instrument), or any deed or assignment in lieu of foreclosure or similar arrangement, shall be subject to the transfer provisions of the Senior Loan Documents; and the p erson (including Junior Lender) who acquires title to the Property pursuant to the foreclosure proceeding (or pursuant to the exercise of a power of sale contained in the Junior Security Instrument) shall not be deemed to be automatically approved by Senior Lender.
5. Insurance. Junior Lender agrees that all original policies of insurance required pursuant to the Senior Security Instrument shall be held by Senior Lender. The preceding sentence shall not preclude Junior Lender from requiring that it be named as a loss payee, as its interest may appear, under all policies of property damage insurance maintained by Borrower with respect to the Property, provided such action does not affect the priority of payment of the proceeds of property damage insurance under the Senior Security Instrument, or that it be named as an additional insured under all policies of liability insurance maintained by Borrower with respect to the Property.
Subordination and Intercreditor Agreement (Fee Deferral) 11 Nevin Apartments
6. Default. Junior Lender and Borrower acknowledge and agree that a default b y either such party under this Agreement shall, at the sole option of Senior Lender, constitute a default under the Senior Loan Documents. Each party hereto acknowledges that in the event any party fails to comply with its obligations hereunder, the other parties shall have all rights available at law and in equity, including the right to obtain specific performance of the obligations of such defaulting party and injunctive relief. No failure or delay on the part of any party hereto in exercising any righ t, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy hereunder.
Notwithstanding any contrary provision contained herein, each of Senior Lender and Junior Lender agrees that Equity Investor shall have the right, but shall not have any obligation, to cure any default or event of default hereunder.
7. Enforcement Costs . Borrower and Junior Lender agree to reimburse Senior Lender for any and all costs and expenses (including reasonable attorneys’ fees) incurred by Senior Lender in connection with enforcing its rights against Junior Lender under this Agreement.
8. Notices. Any notice which any party hereto may be required or may desire to give hereunder shall be deemed to have been given and shall be effective only if it is in writing and (i) delivered personally, (ii) mailed, postage prepaid, by United State registered or certified mail, return receipts requested, (iii) delivered by overnight express courier or (iv) sent by telecopier, in each instance addressed as follows:
To Junior Lender: City of Richmond
Community Development – Housing Division
450 Civic Center Plaza, 2nd Floor
Richmond, California 94804
Attention: Kinshasa Curl
If to Senior Lender: Citibank, N.A.
388 Greenwich Street, Trading 4th Floor
New York, New York 10013
Attention: Transaction and Asset Management Group
Re: Nevin Apartments Deal ID No. 23913
Facsimile: (212) 723-8209
With a copy to: Citibank, N.A.
325 East Hillcrest Drive, Suite 160
Thousand Oaks, California 91360
Attention: Operations Manager/Asset Manager
Re: Nevin Apartments Deal ID No. 23913
Facsimile: (805) 557-0924
With a copy to: Citibank N.A.
c/o Berkadia Commercial Servicing Department
Subordination and Intercreditor Agreement (Fee Deferral) 12 Nevin Apartments 323 Norristown Road, Suite 300
Ambler, Pennsylvania 19002
Attention: Client Relations Manager
Re: Nevin Apartments Deal ID No. 23913
Facsimile: (215) 328-0305
And a copy of any notices
of default sent to:
Citibank, N.A.
388 Greenwich Street, 17th Floor
New York, New York 10013
Attention: General Counsel’s Office
Re: Nevin Apartments Deal ID No. 23913
Facsimile: (646) 291-5754
or at such other addresses or to the attention of such other persons as may from time to time be designated by the party to be addressed by written notice to the other in the manner herein provided. Notices, demands and requests given in the manner aforesaid shall be deemed sufficiently served or given for all purposes hereunder when received or when delivery is refused or when the same are returned to sender for failure to be called for.
9. WAIVER OF TRIAL BY JURY . TO THE MAXIMUM EXTENT
PERMITTED UNDER APPLICABLE LAW, EACH OF THE PARTIES HERETO (A)
COVENANTS AND AGREES NOT TO ELECT A TRIAL BY JURY WITH RESPECT TO
ANY ISSUE ARISING OUT OF THIS AGREEMENT OR THE RELATIONSHIP BETWEEN
THE PARTIES THAT IS TRIABLE OF RIGHT BY A JURY AND (B) WAIVES ANY RIGHT
TO TRIAL BY JURY WITH RESPECT TO SUCH ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE. THIS WAIVER OF RIGHT TO TRIAL
BY JURY IS SEPARATELY GIVEN BY EACH PARTY, KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL.
10. Term. The term of this Agreement shall commence on the date hereof and shall continue until the earliest to occur of the following events: (i) the payment of all of the principal of, interest on and other amounts payable under the Senior Loan Documents; (ii) the payment of all of the principal of, interest on and other amounts payable unde r the Junior Loan Documents, other than by reason of payments which Junior Lender is obligated to remit to Senior Lender pursuant to the terms hereof; (iii) the acquisition by Senior Lender of title to the Property pursuant to a foreclosure, or a deed in l ieu of foreclosure, of (or the exercise of a power of sale contained in) the Senior Security Instrument; or (iv) the acquisition by Junior Lender of title to the Property pursuant to a foreclosure, or a deed in lieu of foreclosure, of (or the exercise of a power of sale contained in) the Junior Security Instrument, but only if such acquisition of title does not violate any of the terms of this Agreement.
Subordination and Intercreditor Agreement (Fee Deferral) 13 Nevin Apartments
11. Miscellaneous.
(a) Junior Lender shall, within ten (10) business days following a request from Senior Lender, provide Senior Lender with a written statement setting forth the then current outstanding principal balance of the Junior Loan, the aggregate accrued and unpaid interest under the Junior Loan, and stating whether, to the knowledge of Junior Lender, any default or event of default exists under the Junior Loan, and containing such other information with respect to the Junior Indebtedness as Senior Lender may require.
Upon notice from Senior Lender from time to time, Junior Lender shall execute and deliver s uch additional instruments and documents, and shall take such actions, as are required by Senior Lender in order to further evidence or effectuate the provisions and intent of this Agreement.
(b) This Agreement shall bind and inure to the benefit of all succes sors and assigns of Junior Lender and Senior Lender. Senior Lender may assign its interest in the Senior Loan Documents without notice to or consent of Junior Lender. Junior Lender may only assign its rights and interests hereunder following the prior wr itten consent of Senior Lender, which consent may be withheld or conditioned in its sole and absolute discretion.
(c) Senior Lender hereby consents to the Junior Loan and the Junior Loan Documents; provided, however, that this Agreement does not constitute an approval by Senior Lender of the terms of the Junior Loan Documents. Junior Lender hereby consents to the Senior Loan and the Senior Loan Documents; provided, however, that this Agreement does not constitute an approval by Junior Lender of the terms of th e Senior Loan Documents.
(d) This Agreement may be executed in multiple counterparts, each of which shall constitute an original document and all of which together shall constitute one agreement.
(e) IN ALL RESPECTS, INCLUDING, WITHOUT LIMITATION,
MATTERS OF CONST RUCTION AND PERFORMANCE OF THIS AGREEMENT
AND THE OBLIGATIONS ARISING HEREUNDER, THIS AGREEMENT HAS
BEEN ENTERED INTO AND DELIVERED IN, AND SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY, THE LAWS OF THE STATE WHERE
THE PROPERTY IS LOCATED, WITHOUT GIVING EFFECT TO ANY
PRINCIPLES OF CONFLICTS OF LAW.
(f) Time is of the essence in the performance of every covenant and agreement contained in this Agreement.
(g) If any provision or remedy set forth in this Agreement for any reason shall be held to be invalid, i llegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision or remedy of this Agreement and this Agreement shall be construed as if such invalid, illegal or unenforceable provision or
Subordination and Intercreditor Agreement (Fee Deferral) 14 Nevin Apartments remedy had never been set forth herein, but only to the extent of such invalidity, illegality or unenforceability.
(h) Each party hereto hereby represents and warrants that this Agreement has been duly authorized, executed and delivered by it and constitutes a legal, valid and binding agreement enforceable in all material respects in accordance with its terms. (i) Borrower hereby acknowledges and consents to the execution of this Agreement, and agrees to be bound by the provisions hereof that are applicable to Borrower. Solely as between Senior Lender and Junior Lender, all of the signatories below hereby agree that to the extent of any conflict between the terms and provisions of this Agreement and the terms and provisions of the Senior Loan Documents and/or the Junior Loan Documents respectively, the terms and provisions of this Agreement shall govern and control. By executing this Agreement in the place provided below, Borrower hereby (i) acknowledges the provisions hereof, (ii) agrees not to take any action inconsistent with Senior Lender’s rights or Junior Lender’s rights under this Agreement, (iii) waives and relinquishes to the maximum extent permitted by law any and all rights, defenses and claims now existing or hereinafter accruing relating to Junior Lender’s forbearance from exercising any rights and remedies pursuant to Section 4 of this Agreement, including, without limitation, any defenses based on the statute of limitations or any equitable defenses, such as laches, and (iv) acknowledges and agrees that (A) t his Agreement is entered into for the sole protection and benefit of Senior Lender and Junior Lender (and their respective successors, assigns and participants), and no other person (including Borrower) shall have any benefits, rights or remedies under or by reason of this Agreement, (B) nothing in this Agreement is intended, or shall be construed to, relieve or discharge the obligations or liabilities of any third party (including Borrower under the Senior Loan Documents and the Junior Loan Documents), (c) neither of them nor any of their affiliates shall be, or be deemed to be, beneficiaries of any of the provisions hereof or have any rights hereunder whatsoever, and (D) no provision of this Agreement is intended to, or shall be construed to, give any such third party (including Borrower) any right subrogating to the rights of, or action against, Senior Lender or Junior Lender.
(j) No amendment, supplement, modification, waiver or termination of this Agreement shall be effective against any party unless such am endment, supplement, modification, waiver or termination is contained in a writing signed by such party. (k) No party other than Senior Lender and Junior Lender (and, solely with respect to the cure rights included in Section 6 hereof, Equity Investor ) shall have any rights under, or be deemed a beneficiary of any of the provisions of, this Agreement. (l) Nothing herein or in any of the Senior Loan Documents or Junior Loan Documents shall be deemed to constitute Senior Lender as a joint venturer or partner of Junior Lender.
12. Reserved.
Subordination and Intercreditor Agreement (Fee Deferral) 15 Nevin Apartments
13. Attached Exhibits.
The following Exhibits are attached to this Agreement and are incorporated by reference herein as if more fully set forth in the text hereof:
Exhibit A – Legal Description
Exhibit B – Junior Loan Documents
Exhibit C – Modifications to Subordination and Intercreditor Agreement The terms of this Agreement are modified and supplemented as set forth in said Exhibits.
To the extent of any conflict or inconsistency between the terms of said Exhibits and the text of this Agreement, the terms of said Exhibits shall be controlling in all respects. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
Subordination and Intercreditor Agreement (Fee Deferral) Nevin Apartments S-1
IN WITNESS WHEREOF, the undersigned have duly executed and delivered this Subordination and Intercreditor Agreement or caused this Subo rdination and Intercreditor Agreement to be duly executed and delivered by their respective authorized representatives as of the date first set forth above.
JUNIOR LENDER:
CITY OF RICHMOND,
a California municipal corporation
By:
Kinshasa Curl
City Manager
Subordination and Intercreditor Agreement (Fee Deferral) Nevin Apartments Ack-1
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA
COUNTY OF
On June _ __, 20 22 before me, _______________________ (here insert name and title of the officer), personally appeared Kinshasa Curl 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/she executed the same in his/her authorized capacity, and that by his/her signature on the instrument the person, or the entity upon behalf of which the person act ed, 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 _______________________________ (Seal)
(signatures follow on subsequent page)
Subordination and Intercreditor Agreement (Fee Deferral) Nevin Apartments S-2
SENIOR LENDER:
CITIBANK, N.A.
By:
Name: Michael Hemmens
Title: Authorized Signatory
Deal ID No. 23913
Subordination and Intercreditor Agreement (Fee Deferral) Nevin Apartments Ack-2
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only t he identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA
COUNTY OF
On June ___, 2022, before me, _______________________ (here inser t name and title of the officer), personally appeared Michael Hemmens who proved to me on the basis of satisfactory evidence to be the person whose nam e is subscribed to the within instrument and acknowledged to me that he executed the same in his authoriz ed capacity, and that by h is 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 _______________________________ (Seal)
Subordination and Intercreditor Agreement (Fee Deferral) Nevin Apartments S-3
ACKNOWLEDGED AND AGREED AS OF THE DATE FIRST SET FORTH ABOVE:
BORROWER:
RICHMOND NEVIN ASSOCIATES,
A CALIFORNIA LIMITED PARTNERSHIP,
a California limited partnership
By: Central Valley Coalition for Affordable
Housing, a California nonprofit public
benefit corporation
Its: Managing General Partner
By:
Name: Christina A. Alley
Title: Chief Executive Officer
By: TPC Holdings VI, LLC, an Idaho limited
liability company, doing business in
California as TPC Idaho Holdings VI, LLC
Its: Administrative General Partner
By:
Name: Caleb Roope
Title: Manager
Subordination and Intercreditor Agreement (Fee Deferral) Nevin Apartments Ack-3
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this cert ificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA
COUNTY OF
On June ___, 20 22, before me, ____________ ___________ (here insert name and title of the officer), personally appeared Christina A. Alley 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 she execut ed the same in her authorized capacity, and that by her 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 _______________________________ (Seal)
Subordination and Intercreditor Agreement (Fee Deferral) Nevin Apartments Ack-4
STATE OF IDAHO )
) ss
COUNTY OF ADA )
I hereby certify that on this ___ d ay of June in the year 2022, before me , ______________________, a Notary Public in and for the said County and State, personally appeared Caleb Roope known or identified to me to be Manager of TPC Holdings VI, LLC , an Idaho limited liability company, who being by me duly sworn under oath, did say that he executed the foregoing instrument on behalf of said entity for the use and purpose therein contained.
[SEAL]
Notary Public
My commission expires:
Subordination and Intercreditor Agreement (Fee Deferral) A-1 Nevin Apartments
EXHIBIT A
LEGAL DESCRIPTION
All that certain real property situated in the City of Richmond, County o f Contra Costa, State of California, described as follows:
PARCEL ONE:
Lots 1 thru 10 inclusive and Lots 15 and 16 in Block 103 as shown on the Map entitled, "Amended Map of the City of Richmond" filed March 31, 1905 in Book D of Maps, Page 74, in the Office of the County Recorder of Contra Costa County.
Excepting therefrom all mineral deposits as defined in Section 6407 of the Public Resources Code lying below a depth of 500 feet, without the right of surface entry, as reserved by the State of California in the Quitclaim Deed recorded January 11, 2005, Series No. 2005 -10471, Official Records.
Assessor's Parcel No. 514-080-013
PARCEL TWO:
Lots 1 thru 12 inclusive and Lots 15 thru 17 inclusive in Block 104 as shown on the Map entitled, "Amended Map of t he City of Richmond" filed March 31, 1905 in Book D of Maps,
Excepting therefrom all mineral deposits as defined in Section 6407 of the Public Resources Code lying below a depth of 500 feet, without the right of surface entry, as reserved by the State of California in the Quitclaim Deed recorded January 11, 2005, Series No. 2005 -10471, Official Records.
Assessor‘s Parcel No. 514-090-018
Subordination and Intercreditor Agreement (Fee Deferral) B-1 Nevin Apartments
EXHIBIT B
JUNIOR LOAN DOCUMENTS
1. Junior Note;
2, Junior Loan Agreement;
3. Junior Security Instrument; and
4. Agreement for Issuance of Building Permits and Deferral of Payment of Impact Fees , dated as of December 20, 2017, between Borrower and Junior Lender, recorded in the Official Records on July 19, 2018 as Instrument No. 2018-0114876-00.
Subordination and Intercreditor Agreement (Fee Deferral) C-1 Nevin Apartments
EXHIBIT C
MODIFICATIONS TO
SUBORDINATION AND INTERCREDITOR AGREEMENT
The following modifications are made to the text of the A greement that precedes this Exhibit:
None.
Capitalized terms used and not defin ed herein shall have the respective meanings ascribed to them in the Agreement.