SPACE ABOVE THIS LINE FOR RECORDER’S USE
SUBORDINATION AGREEMENT
NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY INTEREST IN THE
PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT.
THIS AGREEMENT made this day of by LAO PARK HOUSING CORPORATION, a California nonprofit public benefit corporation, owner of the land hereinafter described and hereinafter referred to as "Owner", and the THE CITY OF SAN PABLO in its capacity as the Housing Successor to the former Redevelopment Agency of the City of San Pablo , hereinafter referred to as “City or “Beneficiary”, and Beneficial State Bank, hereinafter referred to as "Lender".
WITNESSETH THAT WHEREAS, Lao Family Community Development, Inc., a California nonprofit public benefit corporation, has executed a Covenant Agreement Affecting Real Property recorded on December 23, 1993, in Book 19297, Page 575 in the Official Records of the County of Contra Costa, State of California (“Regulatory Agreement”), a Deed of Trust dated December 22, 1993 and recorded on December 23, 1993 as Instrument Number 93- 366612 (“San Pablo Deed of Trust”), both as modified by that Modification Agreement Modifying Affordable Housing Subsidy Agreement, Agency Note, Deed of Trust And Covenant Agreement Affecting Real Property, dated as of January 22, 1996 and recorded on May 24, 1 996 as Instrument Number 96-097852 (“Modification”) and assigned pursuant to that Assignment and Assumption Agreement dated as of January 22, 1996 and recorded on May 24, 1996 as Instrument Number 96- 97862 (Lao Family Community Development to Lao Park Associates) and that certain Assignment and Assumption Agreement dated as of June 27, 2012, and recorded on July 2, 2012 as Instrument Number 2012-0155752 (Lao Park Associates to Lao Housing Corporation) covering:
The land referred to is situated in the County of Contra Costa, City of San Pablo, State of California, and is described as follows:
Parcel B as shown on Parcel Map MS 780- 95 filed on December 26, 1995, in Book 168 of Parcel Maps, Page 25, Contra Costa County Records.
APN: 411-030-009 (“Property”)
WHEREAS, Owner has executed, or is about to execute, a Deed of Trust in the sum of $1,520,000.00, dated , in favor of Beneficial State Bank, hereinafter referred to as “Lender”, payable with interest and upon the terms and conditions described therein, which deed of trust is to be recorded concurrently herewith; and
WHEREAS, it is a condition precedent to obtaining said loan that said deed of trust last above mentioned shall unconditionally be and remain at all times a lien or charge upon the land hereinbefore described, prior and superior to the lien or charge of the line of credit mortgage first above mentioned; and
RECORDING REQUESTED BY
WHEN RECORDED MAIL DOCUMENT
TO:
Beneficial State Bank
3400 Douglas Blvd., #265
Roseville, CA 95661
WHEREAS it is to the mutual benefit of the parties hereto that Lender makes such loan to Owner; and Beneficiary is willing that the Deed of Trust securing the same shall, when recorded, constitute a lien or charge upon said land which is unconditionally prior and superior to the lien or charge of the line of credit mortgage first above mentioned.
NOW THEREFORE, in consideration of the mutual benefits accruing to the parties hereto and other valuable consideration, the receipt and sufficiency of which consideration is hereby acknowledged, and in order to induce Lender to make the loan above referred to, it is hereby declared, understood and agreed as follows:
(1) That said Deed of Trust securing said note in favor of Lender, and any renewals or extensions thereof, shall unconditionally be and remain, at all times, a lien or charge on the property therein described, prior and superior to the lien or charge of the Regulatory Agreement first above mentioned. (2) That Lender would not make its loan above described without this Subordination Agreement. (3) That this Agreement shall be the whole and only agreement with regard to the subordination of the lien or charge of the Regulatory Agreement first above mentioned to the lien or charge of the Deed of Trust in favor of Lender above referred to and shall supersede, but only insofar as would affect the priority between the Regulatory Agreement and Deed of Trust hereinbefore specifically described, any prior agreement as to such s ubordination including, but not limited to, those provisions, if any, contained in the Regulatory Agreement first above mentioned, which provide for the subordination of the lien or charge thereof to another deed or deeds of trust or to another mortgage or mortgages.
Beneficiary declares, agrees, and acknowledges that:
(a) Beneficiary consents to and acknowledges (i) all provisions of the Note and Deed of Trust in favor of Lender above referred to, and (ii) all a greements, including but not limited to any loan or escrow agreements, between Owner and Lender for the disbursement of the proceeds of Lender's loan. (b) Lender in making disbursements pursuant to any such agreement is under no obligation or duty to, nor has Lender represented that it will, see to the application of such proceeds by the person or persons to whom Lender disburses such proceeds and any application or use of such proceeds for purposes other than those provided for in such a greement or agreements shall not defeat the subordination herein made in whole or in part.
(c) Beneficiary intentionally and unconditionally waives, relinquishes and subordinates the lien or charge of the line of credit mortgage first above mentioned in favor of the lien or charge upon said land of the Deed of T rust in favor of Lender above referred to and understands that in reliance upon, and in consideration of, this waiver, relinquishment and subordination specific loans and advances are being and will be entered into which would not be made or entered into but for said reliance upon this waiver, relinquishment and subordination; and
(d) An endorsement has been placed upon the note secured by the line of credit mortgage first above mentioned that said D eed of Trust has by this instrum ent been subordinated to the lien or charge of the Deed of Trust in favor of Lender above referred to. (e) As required by Section 33334.14(a)(4) of the California Health and Safety Code, Beneficiary has determined that an economically feasible alternative method of financing, refinancing or assisting the project situated on the Property, on substantially comparable terms and conditions to the Note and Deed of Trust by the Lender, without subordination, is not reasonably available.
Owner, Lender and Beneficiary further agree as follows:
(4) Neither Lender nor Beneficiary shall complete a foreclosure sale of the Property, or any portion thereof, or record a deed- in-lieu of foreclosure with respect to the Property, or any portion thereof (each a “Foreclosure Remedy”) unless and until the other party (“Notice Party”) has first been given ninety (90) days written notice of the default(s) or Event(s) of Default, giving rise to such party’s right to complete such Foreclosure Remedy (a “Default Notice”), and the Notice Party has failed within such 90-day period to cure such default(s) or Event(s) of Default, provided, however, that the party giving the Default Notice (the “Defaulted Lender”) shall be entitled during such 90-day period to continue to pursue all of its rights and remedies under its respective loan documents, including but not limited to acceleration of its note (subject to the de- acceleration provisions set forth below), commencement and pursuit of foreclosure (but not completion of the foreclosure sale), any guaranty (subject to any notice and cure provisions contained therein), and/or any other loan document. All such notices shall be at the address noted below or at another address as the Lender or Beneficiary may instruct the other in writing from time to time.
(5) It is the express intent of the parties hereunder that (a) Defaulted Lender’s failure to give the Default Notice described in subparagraph (4) above for any reason whatsoever shall not (i) act to impair or waive any remedy or right of such Defaulted Lender under this Agreement or any other loan document of such Defaulted Lender, or (ii) subject such Defaulted Lender to any liability whatsoever to any Notice Party for any loss, cost, or expense any such Notice Party may incur as a result of the failure to provide such notice to such Notice Party, or as a result of such Event(s) of Default giving rise to such Defaulted Lender’s right to complete such Foreclosure Remedy. (6) Unless expressly prohibited by law, Lender and Beneficiary each agree to record a “ Request for Notice,” or similar appropriate document requesting notice of any foreclosure sale, in the Official Records of the County in which the Property is located, and in the event a Defaulted Lender has failed to sooner provide notice to any Notice Party, the receipt of such notice of foreclosure sale by such Notice Party shall be deemed to be notice to the Notice Party as contemplated hereunder. Except as specifically provided herein or otherwise agreed in writing, Defaulted Lender’s failure to give any such notice for any reason shall not act to impair or waive any remedy or right of such Defaulted Lender under this Agreement or any of such Defaulted Lender’s loan documents. (7) With respect to the exercise of the cure rights provided above, the following shall apply:
(a) Each Notice Party shall have the right, but not the obligation, to elect to cure the noticed default(s) or Event(s) of Default (the “Noticed Defaults”) by giving the Defaulted Lender written notice of its intention to cure the Noticed D efaults within the 90- day cure period described above (the “Cure Period”) and thereafter curing all Noticed Defaults within the Cure Period. (b) If a cure of all the Noticed Defaults is completed within the Cure Period, the Defaulted Lender will rescind any notice of default recorded and request dismissal of any receiver who has been appointed after reimbursement of all of Defaulted Lender’s costs, including, without limitation, reasonable attorney’s fees and costs.
(c) Following the timely cure of all Noticed Defaults by a Notice Party, the Defaulted Lender will not exercise its right to accelerate (or will de- accelerate) the amounts due under the Defaulted Lender’s loan documents by reason of the Noticed Defaults cured by such Notice Party, provided, how ever, that nothing herein shall be construed to waive or limit any of Defaulted Lender’s rights or remedies as to any uncured Noticed Default, or any subsequent default by Owner.
NOTICE: THIS SUBORDINATION AGREEMENT CONTAINS A PROVISION WHICH ALLOWS THE
PERSON OBLIGATED ON YOUR REAL PROPERTY SECURITY TO OBTAIN A LOAN A PORTION OF WHICH MAY BE EXPENDED FOR OTHER PURPOSES THAN IMPROVEMENT OF THE LAND.
, Beneficiary , Owner
Beneficial State Bank, Lender
By:
(All signatures must be Notarized)
DATE INSERT NAME, TITLE OF OFFICER, NOTARY PUBLIC
STATE OF CALIFORNIA )
COUNTY OF )
On _____________________ before me,
personally appeared,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s ), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
(SEAL)
NOTARY PUBLIC SIGNATURE
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which the certificate is attached, and not the truthfulness, accuracy, or validity of that document.
DATE INSERT NAME, TITLE OF OFFICER, NOTARY PUBLIC
STATE OF CALIFORNIA )
COUNTY OF )
On _____________________ before me,
personally appeared,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
(SEAL)
NOTARY PUBLIC SIGNATURE
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which the certificate is attached, and not the truthfulness, accuracy, or validity of that document.