Resolution No. 09962 1 RESOLUTION. NO. 9962.
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3 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
4 VERNON APPROVING AND AUTHORIZING THE EXECUTION OF A
LOAN AGREEMENT, AN .ENVIRONMENTAL INDEMNITY.
5 AGREEMENT. AND RELATED LOAN DOCUMENTS BY AND BETWEEN
THE CITY OF VERNON AND EAST-WEST BANK AND
6 AUTHORIZING THE. CITY TO DO ALL ACTIONS DEEMED
NECESSARY OR ADVISABLE CONCERNING THE LOAN
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g WHEREAS, on September 25, 2007, the City Council of the City
g of Vernon adopted Resolut-ion No. 9421 approving a Loan Agreement dated
10 as of September 27, 2007 and an Environmental Indemnity Agreement
11 (collectively; .the."Agreement") with East West Bank (the "Bank") to
12 establish a revolving line of credit-for various real estate
13 transactions from time to time as evidenced by a. Promissory Note dated
14 October 1, 2007 in the amount of $50,000,000.00; and
15 WHEREAS, one- of the sub notes under the Agreement, Loan No.
16 29218-5, for property located at 4855 East 52"d Place is evidenced by a
17 promissory note dated on or about March 20, 2008 :for $7,800,000.00
1g ("Subloan Three"); and
19 WHEREAS, the City of Vernon desires to payoff the existing
20 Subloan three in part by borrowing an additional loan separate from
21 and not to be governed by the Agreement, but rather by its own five
22 year variable rate loan for the sum of $6,370,000.00 so as to extend
23 the date on which the loan is due and to free up additional funds
24 under the revolving line of credit for future real estate
25 transactions.
26 NOW, THEREFORE, BE IT RESOLVED BY THE CLTY COUNCIL OF THE
27 CITY OF VERNON AS FOLLOWS:
28 SECTION 1: The City Council of the-City of Vernon hereby
1 finds and determines that the recitals contained hereinabove are true
2 and correct.
3 SECTION 2: The City Council of the City of Vernon hereby
4 approves the. Loan Agreement, Environmental Indemnity Agreement and
5 related loan documents (collectively, the "Loan Documents") with the
6 Bank in substantially-the same form as the copies which are attached
7 hereto as Exhibit A and incorporated by reference.-
8 SECTION 3: The City Council, of the City of Vernon hereby
9 authorizes the Mayor or Mayor Pro-Tem to execute .the Loan Documents
10 for, and on behalf of, the City of Vernon and the City Clerk or Deputy
11 City Clerk is hereby authorized to attest thereto..
12 SECTION 4: The City Council of the City of Vernon hereby
13 authorizes the City Administrator,. or his designee, to make whatever
14 nonsubstantive, administrative and/or text changes, upon advice of
15 counsel, to .the Loan Documents.
16 SECTION 5~: The City_Council of the City of Vernon hereby
17 approves and authorizes the City Administrator, or his designee, to
18 perform such acts and deeds as may be necessary or convenient to effect
19 the purposes of this Resolution and the transactions herein approved or
20 authorized-and to execute any and all other documents as shall be
21 required to complete the loan.. consistent-with the terms of the Loan
2.2 Documents
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1 SECTION 6: The City Clerk of the City of Vernon shall
2 certify to the passage of this resolution, and thereupon-and
3 thereafter the same sh-all be in full force and effect.
4 APPROVED AND ADOPTED this 18th day of May, 2009.
5 ~V~st/l..i~~.~ ~a'i~
6 Name: Hilario Gonzales
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Title: Mayor / Mayor Pro-Tem
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g ATTEST:
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11 M NUELA GIRON, y Clerk
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1 STATE OF CALIFORNIA )
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2 COUNTY OF LOS ANGELES )
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4 I, MANUELA GIRON, City Clerk of the City of Vernon, do hereby
5 certify that the foregoing Resolution, being Resolution No. 9962, was
6 duly adopted by the City Council of the City of Vernon at a regular
7 meeting of the City Council duly held on Monday, May 18, 2009,-and.
g thereafter was duly signed by the Mayor or Mayor Pro-Tem of the City of
g Vernon.
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MANUELA GIRON, City Clerk
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(SEAL)
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EXHIBIT A
LOAN AGREEMENT
THIS LOAN AGREEMENT (this "Agreement") is entered into as of May 7, 2009 by
CITY OF VERNON, a California. municipal corporation ("Borrower"), and EAST WEST
BANK, a California banking corporation ("Lender").
RECITAL
.Borrower and Lender entered into the Loan Agreement dated as of September 26, 2007
(the "Revolving Loan Agreement"), pursuant to which Lender made a $50,000,000 revolving .
credit facility available to Borrower. Each loan made under the Revolving Loan Agreement is
evidenced by a promissory note and other loan documents. One such loan was made pursuant to
the Revolving Loan. Agreement in the amount of $7,800,000 on or about March 20, 2008
("Subloan Three"). Borrower. wishes to repay Subloan Three in part by borrowing an additional.
loan separate from and not to be governed by the Revolving Loan Agreement, but rather by this
Agreement and the other "Loan Documents" (as defined below).
ARTICLE I
DEFINITIONS
"Debt". means the aggregate amount of all of the following obligations of Borrower and.
its affiliates to Lender: (a) indebtedness or liability for borrowed money whether or not
evidenced by a written instrument; (b) obligations under any guarantee or other agreement to
become secondarily liable for any obligation of another; (c) obligations secured by a lien on
Borrower's or its affiliate's property, whether or not the. obligations have been assumed by
Borrower or such affiliate; and (d) contingent obligations for reimbursement, indemnity and the
like in connection with the issuance of letters of credit and similar instruments for the account of
Borrower or ari affiliate.
"Deed of Trust" means the Deed of Trust,. Security Agreement, Assignment of Rents and
Fixture Filing dated as of the date of this Agreement executed by Borrower for the benefit of
Lender.
"Environmental Indemnity" means the Environmental Indemnity dated as of the date of
this Agreement executed by Borrower in favor of Lender.
"Event of Default" has the meaning set forth in Section b.l of this Agreement.
"Hazardous Materials" means (a) any chemical, compound, material, mixture or
substance that is now or may later be defined or listed in, or otherwise classified pursuant to, any
Hazardous Materials Law as a "hazardous substance", "hazardous material", "hazardous waste",
"extremely hazardous waste", "acutely hazardous waste", "radioactive-waste", "infectious
waste", "biohazardous waste"; "toxic substance", "pollutant", "toxic pollutant", "contaminant" as
well as any formulation not mentioned herein intended to define, list, or classify substances by
reason of deleterious properties such as ignitability, corrosivity; reactivity, carcinogenicity,
toxicity, reproductive. toxicity "EP toxicity," or "TCLP toxicity"; (b) petroleum, natural gas,
natural gas liquids, liquified natural gas, synthetic gas usable for fuel (or mixtures of natural gas
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and such synthetic gas) and ash produced by a resource recovery facility utilizing a municipal
solid waste stream, and drilling fluids, produced. waters and other wastes associated with the
exploration, development or production of crude oil, natural gas, or geothermal resources; (c)
. hazardous substance" as defined in Section 25281(f) of the California Health and Safety Code;
(d) "waste" as defined in Section 13050(d) of the California Water Code (e) asbestos in any
form; (f) urea formaldehyde foam insulation;. (g) transformers or other equipment which contain
dielectric fluid containing levels of polychlorinated biphenyls (PCBs) in excess of fifty (50) parts
per million; (h) radon; and (i) any other chemical, material, or substance that, because of its
quantity, concentration, or physical or chemical characteristics, exposure to which is limited or
regulated for health and safety reasons, by any governmental authority, or which poses a
significant present or potential. hazard to human health and. safety onto the environment if
released into the workplace or the environment.
"Hazardous Materials: Laws" means all present and future federal, state and local laws,
ordinances; regulations, permits,,guidance documents, policies, decrees, orders and any other
requirements, whether statutory, regulatory or contractual, of governmental authorities relating to
health, safety, the environment or the use, handling, disposal or transportation of any Hazardous
Materials (including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, the Resource Conservation Recovery Act, the Clean
Water Act, the Clean Air Act, and the applicable provisions of the California Health and Safety
Code and the California Water Code, as each such statute may from time to time be amended,
and the rules, regulations, and guidance documents promulgated pursuant to any such statute).
"Interest. Rate" means the greater of 5.00°Io per. annum or the sum of the Libor Rate and
2.SOoIo per annum. The Interest Rate shall be fixed for each calendar month based on the
applicable Libor Rate published on the last business day of the preceding calendar month.
"Interest Reserve" has the meaning given that term in Section 2.2(b).
"Lease" means
"Libor Rate" means the Libor rate published from time to time by The Wall Street
Journal as the interest rate now quoted each business day for obligations for six months'
maturity; under the caption "Money Rates, London Interbank Offered Rates (Libor)." If The
Wall Street Journal discontinues publishing Libor Rates, Lender shall select a comparable rate in
its place.
"Loan" .means the loan in the amount of $6,370,000 made to Borrower pursuant to this
Agreement and the other Loan Documents.
"Loan Documents" means this Agreement, the Note, the Deed of Trust, the
Environmental Indemnity, the Security Agreement and all documents; agreements and
instruments executed or otherwise delivered to evidence; secure or-.are otherwise delivered in
connection. with a Loan.
"Net Unrestricted Assets" has the same meaning and is calculated in the same manner as
is described in the "Notes to Basic Financial Statements" attached to the financial statements of
Borrower dated June 30, 2008. delivered to Lender.
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"Note" means the Promissory Note dated the. date of this Agreement in the amount of
$6,370,000 made by Borrower and payable to the order of Lender.
"Payment Date" has the meaning given that term in Section 2.2(a).
"Permits" means- all permits, licenses, operating authorizations, certificates, variances,
waivers, approvals or other authorizations of any kind issued or granted by any governmental
authority which are required in connection with the lawful and proper ownership, operation and
maintenance of the Property.
"Permitted Encumbrances" has the meaning given that term. in Section 4.7.
"Potential Event of Default" means an event which, with the giving of notice or the lapse
of time, or both, would become an Event of Default.
"Property" has the meaning given that term in the Deed of Trust.
"Property Requirements" means (a) all zoning, building, environmental and`other laws,
ordinances, rules; regulations, and restrictions of any governmental authority, including, without
limitation, the Americans with Disabilities Act to the extent applicable, the Subdivision Map Act
and those relating to the presence of asbestos. and/or hazardous wastes, (b) any building permits
or any conditions, easements, rights-of-way, covenants, restrictions of record or any recorded or
unrecorded'agreement affecting or concerning the Property, including, without limitation,
planned development permits, condominium declarations and any owner participation,
development or regulatory agreements with any governmental authority and (c) requirements of
insurance companies or similar organizations, affecting the operation and use of the. Property or
consummation of the transactions contemplated by the Loan Documents.
"Revolving Loan Agreement" has the meaning given that term in the Recital above.
"Security Agreement" means the Security Agreement dated as of the date of this
Agreement executed by Borrower in favor of Lender.
.ARTICLE II
.LOAN
2.1. The Loan. Lender agrees, on the terms and conditions set forth in this
Agreement, to make the Loan to Borrower. The Loan shall be evidenced by the Note. The Loan
is separate from, not made under and is not governed by the Revolving Loan Agreement.
2.2. Payments.
(a) On the first day of each month (each a "Payment Date"), Borrower shall
pay to Lender an amount which. would repay the Loan at the Interest Rate in 180 equal monthly
payments. The amount of the monthly payment shall be recalculated with each change in the
Interest Rate, except that the number of-equal monthly payments shall be reduced by the number
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of months lapsed between: the date of this Agreement and the. date of the recalculation of .the
payment. Interest shall be calculated on the basis of a 360-day year and actual number of days
elapsed.
(b) So long as no Event of Default has occurred and until the tenant under the
Lease actually begins paying the full amount of rent required under the Lease, monthly payments
due under Section 2.2(a) shall be drawn by Lender as and when due-from an interest reserve
established by Borrower with Lender (the "Interest Reserve")..The initial deposit in the Interest-
Reserve shall be _$190,000.00. When the Interest Reserve contains less than the aggregate
amount which will be payable on the next two Payment Dates, Borrower shall deposit with
Lender an amount reasonably determined by Lender as the aggregate. amount payable on the next
- six Payment Dates. Borrower shall make such deposit within 15 days of such demand.
Borrower acknowledges that Lender's having the Interest Reserve is forahe convenience of
Borrower and does not mitigate: Borrower's obligation to make the payments required by Section
2.2(a) as and when due. Lender shall have no obligation to draw payments from the Interest
Reserve. following the occurrence of a Potential Event of Default or an Event of Default. The
Interest Reserve shall be held subject to the terms of the Security Agreement.
(c) .Upon not fewer than two business days' notice and in amounts not less
than $25,000, Borrower may prepay he principal amount of the Loan without premium or fee.
2:3. Principal Repayment. Borrower shall repay the Loan, together with. all interest
accrued on the Loan and all .other amounts outstanding under the Loan Documents, not later than
April 1, 2014..
2.4. 1VIanner of Pa,.~. All payments received by Lender later than 2:00 p.m. (Los
Angeles time) shall be considered received on the following business day. Lender may apply
-any payments made pursuant to the terms of this Agreement and the other Loan Documents in
such order as it shall determine in its sole and absolute discretion.
2.5. Evidence of Debt.
(a) Borrower's indebtedness resulting from the Loan shall. be evidenced by the
Note.
(b) The books and accounts of Lender shall be conclusive evidence, absent
manifest error, of theamount of the Loan,.repayments, interest, fees and other charges advanced,
due, outstanding or paid pursuant to this Agreement.
2.6. Overdue Payments. Any amount payable under this Agreement or any other Loan
Document which is not paid when due (whether as a result of maturity, acceleration or
otherwise) shall bear interest, payable on demand, at a rate equal to the greater of (a) the sum of
the Libor Rate plus six percent per annum or (b) any other applicable default rate provided for in
the Loan Documents.
2.7. Net Pates. All payments made by Borrower under this Agreement and the
other Loan Documents- shall be made without setoff or counterclaim and in such amounts as may
be necessary in order that all such payments (after deduction or withholding for or on account of
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any future taxes, levies, imposts, duties or other charges of whatsoever nature imposed by any
government, any political subdivision or any taxing authority, including future taxes made,
effective retroactively, other than any tax on or measured by the overall net income of'Lender
pursuant to the income, bank or franchise tax laws of the United States or the State of California
(collectively, "Taxes")) shall not be less than the amounts otherwise specified to be paid under
this Agreement and the other Loan Documents. A certificate as to any additional amounts
payable to Lender under this Section 2.7 submitted to Borrower by Lender -shall show in
reasonable detail the amount payable and the calculations used to determine in good faith such
amount and shall be conclusive absent manifest error. Any.amounts payable by Borrower-under
this Section 2.7 with respect to past payments shall be due within five business days following
receipt by Borrower of such certificate from Lender; any such amounts payable with respect to
future payments shall be due concurrently with such future payments. With respect to each
deduction or withholding for or on account of any Taxes, Borrower shall promptly. furnish to
Lender such certificates, receipts and other documents as may be required (in the reasonable
judgment of Lender) to establish any tax. credit,to which Lender may be entitled.. Without any
way affecting,any of its rights under this Section 2.7, Lender agrees that, upon its becoming
aware that any of the present or future payments. due it under this Agreement would be subject to
deduction for Taxes, it will notify Borrower in writing, and Lender further agrees that it will use
reasonable efforts not disadvantageous to it (in its sole determination) in order to avoid or
minimize, as the case may be, the payment by Borrower of any additional amount for Taxes
pursuant to this Section 2.7.
ARTICLE III
CONDITIONS PRECEDENT
3.1. Conditions Precedent: Lender's obligation to make the Loan is subject to Lender's
receipt of the following items or the satisfaction of the following conditions precedent, each in
- form and substance satisfactory to Lender:
(a) the Loan Documents executed and delivered by Borrower; and
(b) an ALTA Loan Policy of Title Insurance issued by a title insurer
satisfactory to Lender, showing the Deed of Trust to be afirst-priority lien on the Property, in an
amount at least equal. to the Loan, containing such endorsements as Lender shall require, not
containing any creditors' rights exclusion and,including only such exceptions as shall be
approved by Lender...
(c) such financial statements concerning. Borrower as Lender shall require;
(d) the following concerning Borrower: (i) a copy of Borrower's charter, (ii) a
certificate from Borrower, including a copy of resolutions, indicating that Borrower is authorized
to execute, deliver and perform the Loan Documents, and (iii). such other documents as Lender
shall request to evidence Borrower's existence and authorization to enter into and perform under
the Loan Documents;
(e) if Lender-shall Yequire, opinions of counsel to Borrower concerning such
matters as Lender shall require;
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(f) aloan fee in the amount of $63,700 and the payment of all of Lender's
costs of closing the Loan,. including; without limitation, appraisal, legal, title, recording, search,
investigation and filing- costs;-
(g) the entire principal balance. of Subloan Three shall have been repaid;
(h) Borrower shall have deposited with Lender the sum of $ 190,000.00 as
the initial deposit in the Interest Reserve; and
(i) such other documents, agreements, certificates and assurances as Lender
shall reasonably require.
ARTICLE IV
REPRESENTATIONS'AND WARRANTIES
. Borrower makes the representations and warranties set forth in this Article IV to Lender.
4,L Existence. Borrower is municipal corporation duly organized, validly existing
and in good- standing under the laws of California.
4.2. Power. Borrower has all necessary corporate power to enter into the Loan
Documents and perform its obligations under them.
4.3. Enforceability of Loan Documents. The Loan Documents have been duly
executed and delivered by Borrower and are the legal, valid and. binding obligations of Borrower,
.enforceable against Borrower in accordance :with their respective terms.
4.4. No Conflict. Borrower's execution and delivery of, and its performance of its
obligations under, the Loan Documents do not and will not conflict-with (a) any (i) contractual or
legal restriction or obligation, or (ii) court or regulatory order, binding on or affecting Borrower,
or (b) any restriction contained in any of Borrower's: constituent or governing documents.
4.5. Pending Litigation or Other Proceedinss. There is no pending or, to the
knowledge of Borrower; threatened action, proceeding. or investigation before any court,
governmental- agency or arbitrator against or affecting Borrower, the Property or any of
Borrower's other assets which, if decided adversely to Borrower, would materially and adversely
affect the financial condition of Borrower or of any of Borrower's assets, including, without
limitation, the Property, or would materially and adversely affect the present or future ability of
Borrower to perform its obligations under-the Loan Documents.
4.6. .Solvency. Borrower is not insolvent and will not be rendered insolvent by the
transactions contemplated by the Loan Documents. After giving effect to such transactions,
Borrower will not be left with an unreasonably small amount of capital with which to engage in
its business or undertakings, nor will Borrower have intended to incur, or believe that it has
incurred, debts beyond its ability to pay such debts as they mature.
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4.7. No Liens. There-are no liens or encumbrances upon or with respect to the
Property except the liens and encumbrances shown on the ALTA Policy of Title Insurance of
this date issued to Lender pursuant to .Section 3:1(b) above (the "Permitted Encumbrances").
4.8. Title. Borrower has good; marketable and indefeasible title in fee to the "Real-
Property" (as defined in the Deed of Trust), free and-clear of all encumbrances except the
Permitted Encumbrances. The Deed of Trust, when properly recorded in the Official-Records of
Los Angeles County, together with its associated Uniform Commercial Code financing
statement, when properly filed with the California Secretary of State, will create, respectively,
(a) a valid; perfected first-priority lien on the Real Property, subject only to Permitted
Encumbrances, and (b) a valid, perfected. first-priority security interest in the "Personal Property"
(as defined in the.Deed of Trust) to the extent such a lien may be perfected by such a filing,
subject only to Permitted Encumbrances. Except for any Permitted Encumbrance or any lien
which has been "insured around" to the satisfaction of Lender, there are no liens or claims -for
work; labor or materials affecting the Property. The Permitted Encumbrances do not materially
adversely impair Borrower's current use and. operation of any of the Property or otherwise
materially adversely impair Borrower's ability to perform any of its obligations under the Loan
Documents.
4.9. Taxes. Borrower has paid and discharged. all installments for the payment of
"Impositions" (as defined in the Deed of Trust) due to date, and all other material- taxes, levies,
maintenance charges, utilities charges or any other governmental or private assessment or
charge, imposed against, affecting or relating to the Property other than those. which have not
become due, together with any fine, penalty, interest or cost for non-payment pursuant to such
returns or pursuant to any assessments received by it.
4.10. Property Requirements. The Property complies in all material respects with all
Property Requirements now affecting the Property. Without limiting the foregoing, all Permits,
including, without limitation, all certificates of occupancy necessary for the lawful occupation of
the Property, have been issued, and are in full force and effect.- Borrower has not received any
written notification or threat of any actions or proceedings regarding the noncompliance or
nonconformity of the Property with Property Requirements or Permits, nor is Borrower
otherwise aware of any such pending actions or proceedings,
4.11. Liability for Hazardous Materials. Borrower has no jiability; contingent or
otherwise, under any Hazardous Materials Law or with respect to any activity involving
Hazardous Materials on or about the Property.
4.12. Hazardous Materials Activity. There exists no activity involving Hazardous
Materials on or about the Property in violation of any Hazardous Materials Law and Borrower
has not caused or, to the knowledge of Borrower, permitted to occur any condition which may
cause a release of any Hazardous Materials in violation of any Hazardous Materials Law on or
about the Property.
4.13. .Hazardous Materials Laws. (a}Neither Borrower nor; to the knowledge of
Borrower, any other party, has been or is involved in operations at the Property which could
reasonably be expected to lead to (i) the imposition of liability on Borrower under any
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Hazardous Materials Law, or on any subsequent or former owner of -the Property, or (ii) the
creation of a lien on the Property under-any Hazardous Material Law; and (b) Borrower has not.
permitted any tenant or occupant of the Property to engage in any activity that could reasonably
be expected to impose a claim or liability under any Hazardous Material Law on such tenant or
occupant, on Borrower or on any other subsequent or former owner of the Property.
4.14. Status of Landlord under Leases. Borrower is the owner and holder of the
landlord's interest under the Lease and there are no prior outstanding assignments of the Lease,
or any portion of the rents, additional rents, charges, issues or profits due and payable or to
become due and payable under the Lease.
4.15. Enforceabilit~f Lease. The Lease constitutes the legal, valid and binding
obligation of Borrower and, to the knowledge of Borrower, of the tenant under the Lease,.
enforceable in accordance with its terms. No notice of any default under the Lease which
remains uncured has been sent by Borrower or received by Borrower from the tenant under-any-
Lease:
4.16. No Option or Other Rights. The Lease is occupied by the tenant as a tenant only..
The Lease. does not contain any option to purchase, right of first refusal or any other similar
provision. No option to purchase, right of first refusal or similar right exists with respect to the
Property.
4.17. Insurance. Borrower has complied with all of the requirements of Section 2.11 of
the Deed of Trust with respect to insurance.
4.18. Encroachments. None of the improvements located on the Property encroaches
upon the property of any other person nor lies outside of the boundaries and building restriction
lines of the Property and no improvement located on property adjoining the Property lies within
the boundaries of or in any-way encroaches upon the Property.
4.19. Independent Unit. (a) The Property is an independent unit which does. not rely on
any drainage, sewer, access, parking, structural or other facilities located on any property not
included in the Property or on public or utility easements for (i) the fulfillment of any .zoning,
building code or other requirement of any governmental authority that has jurisdiction over the
Property, (ii) structural support or (iii) the fulfillment of the requirements of the Lease or other
agreement affecting the Property; (b) Borrower, directly or indirectly, has the right to use all
amenities, easements, public or private utilities, parking, access routes or other items necessary
or currently used for the operation of the Property; (c) all public utilities are installed and
operating at the Property and all billed installation and connection charges have been paid in full;
and (d) the Property is either (i) contiguous to or (ii) benefits from an irrevocable unsubordinated
easement permitting access from the Property to a physically open, dedicated public street, and
has all necessary permits for ingress and egress and is adequately serviced by public water, sewer
systems and utilities. No building or other improvement not located on the Property relies on
any part of the Property to fulfill any zoning requirements, building code or other governmental
or municipal requirements for structural support or to furnish to such building or improvement
any essential building systems or utilities.
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4.20. Condition of Property. (a) The Property is in good condition, order and repair in
-all material respects; (b) there exist no structural or other material defects in the Property,
whether latent or otherwise; and. (c) Borrower has not received notice from any insurance
company or bonding company of any defects or inadequacies irr the Property which would
adversely'affect its insurability or cause the imposition of extraordinary premiums or charges for
insurance or of any termination or threatened termination of any policy of insurance or bond: To
Borrower's knowledge, no claims have been made against any contractor, architect, engineer or
other party with respect to the condition of the Property or the existence of any structural or other
material defect with respect to the Property.
4.21. No Contractual Defaults.. There are no material defaults by Borrower or, to
Borrower's knowledge, by any former owner or any -other person under any material contract, to
which Borrower is a party relating to the Property, including, without limitation, any
management, rental, service, supply, security,. maintenance or similar contract. Neither
Borrower nor, to Borrower's knowledge, any former owner has received notice or has any.
knowledge of any existing circumstances in respect of which it could receive any-notice of
default or breach in respect of any material contracts affecting or concerning the Property.
4.22. Financial'Position. The financial statements and all financial data delivered to
Lender relating to Borrower and the Property are true, correct and complete in all material
respects. Such financial statements fairly. present the financial position of the parties or
properties who are their subjects as of the dates indicated: No material adverse change has
occurred in such financial position since the date of such financial statements.
..4.23. Disclosure. None of Borrower's representations or warranties contained in this
Agreement or any other document, certificate or written statement furnished to Lender by or on
behalf of Borrower contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements contained in this Agreement or in such other
document, certificate or written statement (when taken in their entirety) not misleading. There is
no fact known to Borrower which materially or adversely affects the. business, operations, assets
or condition (financial or otherwise) of Borrower. or the Property which has not been disclosed in
this Agreement or in another written statement delivered to Lender by Borrower.
ARTICLE V
COVENANTS
While any obligation of Borrower under the Loan Documents-remains outstanding,
Borrower shall comply with the following covenants.
' 5.1. Organization and Status of Borrower. Borrower shall maintain-its corporate
existence and all licenses and permits relating thereto in good standing with the State of
California.
5.2. Compliance with Laws. Borrower shall remain in compliance in all material
respects- with all laws and requirements applicable to its business and obtain all authorizations,
consents, approvals, orders, licenses, exemptions from, and accomplish all filings or registrations
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or qualifications with,. any governmental agency that are necessary for the transaction of its
business.
5.3. Governmental Approvals. Borrower shall deliver to Lender from time to time at
Lender's request, in form and substance satisfactory, to Lender, evidence that Borrower has
complied .with all applicable Property Requirements and that all Permits have been regularly and
finally received with respect to the Property..
5.4. Books and Records. Borrower shall maintain. full and complete books of account
and other records reflecting the results of its operations and the operations of the Property, in
accordance with generally accepted accounting principles applied on a consistent basis, and
permit Lender and its agents, at all reasonable times and from time to time, to inspect and copy
any such books and records.
5.5. Maintenance bfProperty. Borrower shall maintain the Property in good condition
-and repair; take precautions against the occurrence of damage thereto; and not permit any waste
with respect to the Property.
5.6. Notice of Certain Matters. Borrower shall give notice to .Lender, promptly upon
learning thereof, of each of the following:
(a) any litigation or claim of any kind affecting or relating to the Property and
involving an amount in excess of $50,000; and any litigation or claim of any kind that might
subject Borrower to liability in excess of $1.,000,000, whether covered by insurance or not;
(b) any material dispute between Borrower and any governmental agency;
(c) .any threat or commencement of proceedings in condemnation or eminent
domain relating to the Property;
(d)' the occurrence of any Event of Default or Potential Event of Default and
Borrower's plans for curing same;
(e) the existence of any lien or encumbrance on the Property other than as
permitted by the terms of the Loan Documents; and
(f) any other event or condition causing a material adverse change in the
financial condition of Borrower.
5.7. Further Assurances. Borrower shall execute and acknowledge (or cause to be
executed and acknowledged) and deliver to Lender all documents, and take all actions, required
by Lender from time to time to confirm the rights created or now or hereafter intended to be
created under the Loan Documents and the transactions contemplated thereunder, to maintain,
protect, perfect and further. the validity, priority and enforceability of the Loan Documents and
all liens on the Property or other collateral for Borrover's obligations under'the Loan
Documents, to subject to the Loan Documents any property intended by the terms of any Loan
Document to be covered by such Loan Documents.
10
5.8. Information. Borrower-shall furnish the following information, reports and notices
to Lender in form and substance reasonably satisfactory to Lender:
(a) as soon as available but in no event later han 90 days-after the end of each
calendar year, (i) the balance sheet and income statements of Borrower, comparing the figures in
such statements to those for the previous year, all in reasonable detail; and (ii) a-report showing
the calculation of Borrower's compliance with the. interest coverage covenant set forth in Section
5.12 below for the fiscal year and both halves of the fiscal year, accompanied by the certificate
of an independent certified public accountant satisfactory to Lender, stating that such financial
statements have-been prepared in accordance with generally accepted accounting principles,
consistently applied, and that such financial statements fairly present the financial condition of
Borrower for such year and period;
(b) as soon as available but in no event later than 90 days after the end of the a
first half of each fiscal year, the same statements 'as are required by Section 5.8(a), accompanied
by the certificate of a representative of Borrower satisfactory to Lender stating that such
statements-have been prepared in accordance with generally accepted accounting principles,
consistently applied, and that such statements fairly present the financial condition of Borrower
for such period;
(c) as soon as available but in no event later than 90 days after the end of each
fiscal year and period six months after the end of the fiscal year, an operating statement of the
Property's income and expenses for the semi-annual period then .ended comparing such operating
results to those for (i) the immediately preceding quarter, and (ii) the same period. in the previous
year, all in reasonable detail, accompanied by the certificate of a representative of Borrower
reasonably satisfactory to Lender stating that the operating statement has been prepared in
accordance with generally accepted accounting principles consistently applied, and that such
operating statement fairly"presents the results of operations for the Property for the period
presented;
(d) such other information concerning the Property as .is required by the Loan.
Documents or Lender from time to time; and
(e) all other information, reports and notices relating to the Property and
Borrower that Lender shall reasonably request.
5.9. Ins ep ction. Borrower, upon reasonable notice and during regular business hours,
shall make the Property available to Lender and Lender's agents for inspection and appraisal
from time to time.
5.10. Deposits. Borrower shall use its best efforts to maintain on deposit with Lender
aggregate funds in an amount not less than $30,000,000, such deposits not to earn interest at a
rate greater than the federal funds rate-minus .25%-per annum from time to time:
5:11. Unrestricted Net Assets.
(a) Borrower shall at all times maintain Unrestricted Net Assets in an amount
not less than $25,000,000.
11
i
(b) On each December 31 and June 30, the ratio of the amount of all Debt to
Unrestricted Net Assets shall not exceed 1.00:1:00:
5.12. Covera eg Ratio. The ratio during each period of the first and second halves of
Borrower's fiscal year of (a) net income from the City of Vernon Electrio System; without
deduction for interestexpense on bond obligations owed directly or indirectly by Borrower, to
(b) the sum of interest expense on all bond obligations owed directly or indirectly by Borrower
and. the amount of interest accrued'on all indebtedness-owing to Lender, shall not be less than
1,30:1.00.
ARTICLE VI
EVENTS OF DEFAULT
6.1. Events of Default.. The occurrence of any of the following shall be an "Event of
Default":
(a) Borrower's failure to pay when due any amount owing under any- Loan
Document (including, without limitation, any failure by,Borrower to replenish a Loan's interest.
reserve withiri 15-days following Lender's demand in accordance with Section 2.2(b));
(b) Any breach of the covenants set forth in Sections 5.10, 5.11 or-5.12,
Borrower's failure to maintain insurance of the kinds and in the amounts required by the Loan
Documents or Borrower's failure to make the Property available for inspection by Lender on the
terms required by the Loan Documents;
(c) Excepf as provided in Sections 6.1(a), (b) or (e); the failure of Borrower;
within 30 days following written notice from Lender, to observe or perform any covenant or
other agreement contained in this Agreement; provided, however, that the: notice and 30-day
grace period set forth- above shall be applicable only to a failure to observe or perform any
covenant or other agreement which is reasonably susceptible of being cured; provided further;
that should Borrower be unable to cure its failure within such 30-day period despite beginning to
.cure such failure promptly after receipt of notice and prosecuting such attempt diligently during-
such 30-day period, the cure period shall be extended an additiona130 days so long as Borrower
continues diligently to prosecute the cure during such additional period;
(d) any written representation, warranty or financial statement given by
Borrower shall have been untrue in any material respect when given;
(e) the occurrence of a default under any Loan Document and the failure of
any such default to be cured during the permitted time, if any, for such cure;
(f) Borrower shall be. unable or shall admit in writing its inability to pay its
debts when due, or shall make an assignment for the benefit of creditors; or Borrower shall apply-
for or consent to the appointment of any receiver, trustee or similar officer for such person or for
all or any substantial part of Borrower's property; or any of them shall institute (by petition,
application, answer, consent or otherwise) any bankruptcy, insolvency, reorganization,
arrangement, readjustment of debts, .dissolution, liquidation, or similar proceedings relating to
Borrower under the laws of any jurisdiction;
12
{g) if a receiver, trustee or similar officer shall be appointed for Borrower or
for. all or any substantial part of Borrower's property without the application or consent of such
person, and such appointment shall continue undischarged for a period of 60 days (whether or
- not consecutive);. or any bankruptcy, insolvency, reorganization, arrangement, readjustment of
debt, dissolution, liquidation or similar proceedings shall be instituted (by petition, application or
otherwise) against any such person and shall remain undismissed for a period of 60 days
(whether or not consecutive);
(h) the Property, Interest Reserve, Environmental Remediation Reserve or all
or any material part of the assets.of Borrower shall become subject to attachment, execution or
judicial seizure (whether by enforcement of money judgment, by writ or warrant of attachment,
or by any other process);
(i) Borrower shall be in default in the payment of any indebtedness or the
performance of any other obligation secured by a lien on the Property and such default is not
cured .within the time, if any, specified for such a cure in any .applicable agreement; or
(j) any of the Loan Documents shall cease to be a valid, binding and
enforceable obligation of the person purported to be bound;. or the lien of-the Deed of Trust or
any other Loan Document securing any of Borrower's obligations shall cease to be a valid,
enforceable, perfected, first-priority lien on the Property; or Borrower shall assert such cessation
or failure in writing.
6.2. Remedies upon Default. Upon the occurrence of any Event of Default, Lender
may, at its option, do any of the following:
(a) declare the principal of all amounts owing under the Loan Documents,
together with all accrued interest thereon and all other amounts owing in connection therewith, to
be immediately due and payable, regardless of any other specified maturity or due date, without
notice of .default, presentment or demand for payment,. notice or demand of-any kind, and
without the necessity of prior recourse to any security;.
(b) if the Event of Default may be cured by the payment of money, Lender
may (but shall not be obligated) to make such payment from its own funds; provided, that the
making of such payment by Lender shall not be deemed to cure such Event of Default, and that
the same shall not be cured unless and until Borrower reimburses Lender for such payment. If
Lender advances its own funds for such purposes, the funds advanced shall be secured by the
applicable Loan Documents, notwithstanding that such advances may cause the total amount
advanced under this Agreement to exceed the aggregate amount available under. this .Agreement
or the amount committed to be advanced pursuant to this Agreement; and
(c) exercise any of its. rights under the Loan Documents, including the right to
foreclose on any security, and exercise any other rights with respect to any security, whether
under the Loan Documents or as provided by law, all in such order and in such manner as Lender
in its sole discretion may determine.
6.3. Cumulative Remedies; No Waiver. Lender's remedies under the Loan Documents
are cumulative and shall be in addition to all rights and remedies provided by law or in equity
13
from time to time. The exercise by Lender of any right or remedy shall not constitute a cure or
waiver. of any default, nor invalidate any notice of default or any act done pursuant to any such
notice,- nor prejudice Lender in the exercise of any other right or remedy. No waiver by Lender
of any default shall be implied from any omission by Lender to take action on account of such
default if such default persists or is repeated. No express waiver by Lender of anydefault shall
affect any default other than the default expressly waived, and any such express waiver shall. be
operative only for the time and to the extent. of any Loan Document shall be construed as a
waiver of any subsequent breach of the same covenant, term or condition. Lender's consent to or
approval of any act by Borrower requiring further consent or approval shall not be deemed. to
waive or render unnecessary Lender's consent to or approval of any subsequent act.
. ARTICLE VII
- MISCELLANEOUS
7.1. Notices. Any notice, demand or request required- under-this Agreement hall be
given in writing at the addresses set forth below by personal service; telecopy; overnight courier;
or registered or certified, first class mail, return receipt requested.
If to Borrower:
City of Vernon
4305 Santa Fe Avenue
Vernon, CA 90058
Attention: City Administrator
Fax No.: (323) 826-1438 .
If to Lender:-
East West Bank
135 N. Los Robles Ave., Suite 600
Pasadena, CA 91101
Attention: Flora Ling
Fax No.: (626) 817-8898
Such addresses may be changed by notice to the other parties given in the same manner as
required above. Any notice, demand or request shall be deemed received as follows: (i) if sent
by personal service, at the time such personal service is effected; (ii) if sent by telecopy, upon the
sender's receipt. of a confirmation report generated by the. sender's telecopier indicating receipt by
the recipient's telecopier; (iii) if sent by overnight courier; on the business day immediately
following deposit with the overnight courier; and (iv) if sent by mail, 48 hours following deposit
in the mail.
7.2. Governing Law. All questions with respect to the construction of this Agreement
and the rights and liabilities of the parties to this Agreement shall be governed by the laws of the ~
State of California.
14
7.3.: Binding Successors. This Agreement shall inure to the benefit of, and shall be
binding upon, the successors and assigns of each. of the parties to this Agreement.
7.4. Attorneys' Fees.
(a) Borrower shall reimburse Lender for all reasonable attorneys' fees, costs
and expenses, incurred by Lender in connection with the enforcement of Lender's rights under
this Agreement and-each. of the other Loan Documents, including, without limitation, reasonable
attorneys' fees, costs and expenses for trial, appellate proceedings, out-of-court negotiations,.
workouts and settlements or for enforcement of rights under any state or federal statute,
including, without limitation, reasonable attorneys' fees, costs and expenses incurred to protect
Lender's security and attorneys' fees, costs and expenses incurred in bankruptcy and insolvency
proceedings such as (but not .limited to) seeking- relief from stay in a bankruptcy proceeding.
The term "expenses" means any expenses incurred by Lender in connection with any of the out-
- of-court, or state, federal or bankruptcy proceedings referred to above, including, without
limitation, the fees and expenses of any appraisers, consultants-and expert witnesses retained or
consulted by Lender in connection with any such proceeding.
(bj Lender shall also be entitled to its attorneys' fees, costs and expenses
incurred in any post judgment proceedings to .collect and enforce the judgment. This provision
is separate and several and shall survive the merger of this Agreement into any judgment on this
Agreement.
7.5. Counterparts. This Agreement may be executed in any number of original
counterparts, each of which shall be deemed an original, but all of which when taken together
shall constitute one instrument. The original signature page of any counterpart may be detached
from such counterpart and attached to any other counterpart identical to such counterpart (except
having additional signature pages executed by other parties to this Agreement) without impairing
the legal effect of any such signature(s).
7.6. Entire Agreement. This Agreement -and the other Loan Documents constitute the
entire agreement and understanding between the parties in respect of the subject matter of this
Agreement and supersede all prior agreements and understandings with respect to such subject
matter, whether oral or written:
7.7. Waivers. Waiver by Lender of any term, covenantor condition under this
Agreement or the Loan Documents, or of any default by Borrower under this Agreementor the
Loan Documents, or any failure by Lender to insist upon strict performance by Borrower of any
term,. covenant or condition contained in this Agreement or the Loan Documents; shall be
effective or binding on Lender only if made in writing by Lender; no such wavier shall be .
implied from any omission by Lender to take action with respect to any such term, covenant,
condition or default. No express written waiver by Lender of any term, covenant, condition or'
default shall affect any other term, covenant, condition or default or cover any other time period
than the application of any such term, covenant or condition to the matter as to which a waiver
has been given or the default or time period specified in such express waiver. This Agreement.
may be amended only by an instrument in writing signed by the parties to this Agreement.
15
7.8. Severability. If any part of this Agreement is declared invalid for any reason,
such shall not affect the validity of the- rest of the Agreement. The other parts of this Agreement
shall remain in effect as if this Agreement had been executed without the invalid part. The
parties declare that they intend and desire that the remaining parts of this Agreement continue to
be effective without any part orparts that have been declared invalid:
7.9. Reimbursement Obli ations. Borrower shall reimburse Lender upon demand for
all payments made by Lender and all costs and expenses incurred by Lender, whether such costs
and expenses are the result of work performed by Lender's employees or by independent
contractors (including attorneys' fees and related expenses as set forth in Section 7.4 above, fees
and expenses incurred in connection with any appraisal or inspection o'f the Property and review
of any such appraisal of the Property, and fees and expenses of all inspectors, accountants and
other outside experts retained by Lender), in connection with the negotiation, preparation;.
execution;: delivery, administration, modification, performance .and enforcement of the Loan
Documents, the performance by Lender of its obligations under the Loan Documents, taking
such actions under the Loan Documents that Lender is entitled to take and all..matters related
.thereto, including, but not limited to; the following:
(a) title insurance premiums, casualty and liability. insurance premiums, bond
premiums, realty tax .services, recording fees, filing fees, documentary or stamp .taxes, and release
and reconveyance fees;
(b) funds advanced by Lender to protect its rights under the Loan Documents
or with respect to any collateralsecuring the obligations of Borrower under the Loan Documents
(including, without limitation, payments to the holder of any lien on or other interest in the
Property, whether senior or subordinate. to any deed of trust);
(c) all liabilities, losses, costs' and expenses suffered or incurred by Lender as
a direct or indirect result of any Event of Default or Potential Event of Default;
(d) costs and expenses (including; without limitation, costs of suit or ,
attorneys' fees) arising out of Lender's commencement of, appearance in and/or defense of any.
action or proceeding purporting to affect the rights or duties of the parties to, or the payment of
any funds under, any Loan Document; and
(e) all claims, demands, actions, causes of action, liabilities, losses,
commissions, costs and.expenses against which Lender is indemnified under this Agreement or
the other Loan Documents.
Borrower's. reimbursement obligations hereunder shall be secured by the Loan Documents, shall
survive as unsecured obligations to the extent. unpaid as of the date of any release and
reconveyance of the Loan Documents; and shall bear interest. following demand at any default
rate provided for in the Loan Documents.
7.10. Indemnity. Borrower shall indemnify and hold harmless Lender and its directors,
officers, agents and' employees (collectively, the. "indemnitees") from and against, and agrees to
defend the indemnitees, by counsel satisfactory to the indemnitees, against:
16
(a) all claims, demands, liabilities, damages, costs and causes of action
asserted against any indemnitee if the claim, demand, liability, damage, cost or cause of action
directly or indirectly relates to (i) a claim, demand, liability, damage, cost orcause of action that
any person or entity has or asserts against Borrower in connection with the Property; (ii) the
payment of any commission, charge or brokerage fee incurred in connection with the Loan
Documents (unless based on any act or representation of Lender); {iii) any act or omission by
Borrower, any contractor, subcontractor or material supplier, engineer, architect or other person
or entity with respect to the Property; (iv) the Loan or the ownership, occupancy or use of the
Property; and
(b) all liabilities, losses and other costs (including court costs and attorneys'
fees) incurred by any indemnitee as a result of any claim, demand or cause of action described in
subparagraph (a).
Lender's rights of indemnity shall .not be directly or indirectly limited, prejudiced, impaired or
eliminated in any way by a finding or allegation that Lender's conduct is active, passive or
subject to any other classification or that Lender is directly or indirectly responsible under any
theory of any kind for any act or omission by Borrower or any otherperson or entity other than
Lender, its agents, servants or employees. Borrower's obligations under this Section 7.10 shall '
survive the release and reconveyance of the Loan Documents.
[Signatures appear on following page.]'
17
Lender:
EAST WEST BANK,
a California banking corporation
By:
- Flora Ling, Senior Vice President
Borrower:
CITY OF VERNON, ~
a municipal corporation
By:
Name:
Title:
ATTEST:
By:
City Clerk
APPROVED AS TO FORM:
City Attorney
ENVIRONMENTAL INDEMNITY
THIS ENVIRONMENTAL INDEMNITY is entered into as of May 7, 2009, by
CITY OF VERNON, a California municipal. corporation ("Indemnitor"), for the benefit of EAST
WEST BANK, a California banking corporation ("Lender"), and each. of its ,successors, assigns
and participants, and. its and their respective parent, subsidiary. and affiliated corporations, and
their respective directors, officers; .agents, attorneys and employees of each. of them (each
. individually, an "Indemnitee" and collectively, "Indemnitees").
RECITALS
A. Indemnitor is the maker of the Promissory Note of this date (the "Note")
in the principal amount of $6,370,000 payable to the order of Lender. The Note evidences a loan
from Lender to Indemnitor governed by the Loan Agreement dated as of the date of -this
Agreement between Indemnitor and Lender (the "Loan Agreement"). The Note and Loan
Agreement are secured by the Deed of Trust; Security Agreement, Assignment of Rents and
Fixture Filing dated as of the date of this Indemnity executed by Indemnitor for the benefit of
Lender. ("Deed of Trust"). The Deed of Trust encumbers the "Property'` (as defined in the Deed
of Trust).
B. :Lender requires Indemnitor to execute this Indemnity as a condition
precedent to. Lender's entering into .the Loan Agreement. Indemnitor is willing to execute this
Indemnity because of the benefits of Lender's entering into the Loan Agreement.
AGREEMENT
1. Indemnitv.:Indemnitor shall be solely responsible -for, and shall indemnify
and hold harmless each Indemnitee from and against,. any loss, damage, cost, expense, claim or
liability directly or indirectly arising out of or attributable to the use; generation; storage; release;
threatened release, discharge. or disposal; or presence of "Hazardous Materials" (as defined
below) on or about the Property, including, without limitation: (a) all consequential damages
incurred by any Indemnitee; (b) the costs of any required or necessary repair, cleanup or
detoxification of the Property and the preparation and implementation of any closure, remedial or
other required plans; and (c) all reasonable costs and expenses incurred by any Indemnitee in
connection with. clauses (a) and (b), including, without limitation, reasonable attorneys' fees.
For purposes of this Indemnity, the following terms shall have the
following definitions:
"Hazardous Materials" means {i) any chemical, compound, material,
mixture or substance that is now or hereafter defined or listed in, or otherwise classified pursuant
to, any "Hazardous. Materials Law" (as defined below) as a "hazardous substance", "hazardous
material", "hazardous waste"; "extremely hazardous waste", "acutely hazardous waste",
"radioactive waste", "infectious waste", "biohazardous waste"; "toxic substance"; "pollutant",
"toxic pollutant"; "contaminant" as well as any formulation not mentioned herein intended to
define, list, or classify substances by reason of deleterious properties such as ignitability,
1
corrosivity, reactivity, carcinogenicity, toxicity, reproductive toxicity "EP toxicity," or "TCLP
toxicity"; (ii) petroleum, natural gas, natural gas liquids,liquified natural gas, synthetic gas
usable for fuel (or mixtures of natural gas and such synthetic gas) and ash produced by a
resource recovery facility utilizing a municipal solid waste stream, -and drilling fluids, produced
waters and -other wastes associated with the exploration, development or production of crude oil,
natural gas, or geothermal resources; (iii) "hazardous substance" as defined in Section 25281(f)
of the California Health and Safety Code; (iv) "waste" as defined in Section 13050(d) of the
California Water Code (v) asbestos in any form; (vi) urea formaldehyde foam insulation; (vii)
transformers or other equipment which contain dielectric fluid containing levels of
polychlorinated biphenyls (PCBs) in excess of fifty (50) parts per million; (viii) .radon; and (ix)
any other chemical, material, or substance that, because of its quantity, concentration, or physical
or chemical characteristics, exposure to which is limited or regulated for health and safety
reasons by any governmental authority, or which poses a significant present or potential hazard
to human health and safety or to the environment if released into the workplace or the
environment.
"Hazardous Materials Laws" means all present. and future federal, state
and local laws, ordinances, regulations, permits, guidance-documents, policies, decrees; orders
.and any. other requirements; whether statutory, regulatory or contractual, of governmental
authorities relating, to health, safety, the environment or the use, handling, disposal or
transportation of any Hazardous Materials (including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, the Resource Conservation
Recovery Act, the Clean Water Act, the Clean Air Act, and the applicable provisions of the
California Health and Safety Code and the California Water Code, as each such statute may from
time to time be amended, and the rules, regulations, and guidance documents promulgated
pursuant to-any such statute).
2. Indemnity Procedure.
(a) If any Indemnitee notifies Indemnitor of any claim or notice of the
commencement of any` action, administrative or legal proceeding or investigation as to which
Indemnitor's obligation to indemnify under Section 1 above applies, Indemnitor shall assume on
behalf of such Indemnitee, and conduct with due diligence and in good faith, the investigation
and defense of, and the response to,-such claim; action, proceeding or investigation, with counsel
reasonably satisfactory to the Indemnitee;'provided, however, that such Indemnitee shall have
. the right to be represented by advisory counsel of its own selection and at its own expense;-and
provided; further, that if any-such claim, action, proceeding, or investigation involves both
Indemnitor and an Indemnitee, and such Indemnitee shall have reasonably concluded that there
may be legal defenses available to it which are different from, additional to, or inconsistent with
those available to Indemnitor, then the Indemnitee shall have the right to select separate counsel
to participate in the- investigation and defense of and response to such claim, action, proceeding
or investigation on its own behalf at Indemnitor's expense.
(b) If any claim, action; proceeding, or investigation arises as to which
Indemnitor's duty to indemnify under this Indemnity applies, and Indemnitor fails to assume
promptly (and in any event within ten days after being notified of the claim, action, proceeding,..
or investigation) the defense of an Indemnitee, then such Indemnitee may contest and settle the
2
claim, action, proceeding, or investigation at Indemnitor's expense using counsel selected by
such Indemnitee; provided, however, that after any such failure by Indemnitor no such contest
need be made by such Indemnitee and settlement or full payment of any claim may be made by
such Indemnitee without Lidemnitor's consent and without releasing Indemnitor from any
obligations to such Indemnitee under this Indemnity.
3. Dama eg
s Unrelated to Loan. This Indemnity is given solely to protect
Lender and the other Indemnitees against claims, losses, damages, costs, expenses, claims and
liabilities, and not as additional security for, or as a means of repayment of, the loans evidenced
by the Note. The obligations of Indemnitor under- this Indemnity are independent of, and shall
not be measured or affected by (a) any amounts at any time owing under the Note or secured by
any Deed of Trust,-(b) the sufficiency or insufficiency of any collateral (including, without
limitation, the Property) given to Lender to secure the Note, (c) the consideration given by
Lender or any other party in order to acquire the Property, (d) the modification, expiration or
termination of any Deed of Trust or any other document or instrument securing or otherwise
relating to the loan evidenced by the Note, or (e}the payment in full or other cancellation of the
Note (including, without limitation, by amounts paid or credit bid at a foreclosure sale or by
discharge in connection with a deed in lieu of foreclosure). Indemntor's obligations under this
Indemnity are not secured, whether by a Deed of Trust or otherwise.
4. Survival of Sale by Indemnitor. Indemnitor's obligations under this
Indemnity shall survive the sale or other transfer of the. Property by Indemnitor._ The rights of
each Indemnitee under this Indemnity shall. be in addition to any other rights and remedies of
such Indemnitee against Indemnitor under any other document or instrument executed by such
Indemnitor, or at law or in equity (including, without limitation, any right of reimbursement or
contribution pursuant. to CERCLA), and shall not in any way be deemed a waiver of any of such
rights. Indemnitor agrees that it shall have no right of contribution or subrogation against any
other Indemnitor (if more than one Indemnitor), unless and until all obligations of such
Indemnitor under this Indemnity have been satisfied. Each Indemnitor further agrees that, to the.
extent that. the waiver of its rights of subrogation and contribution is found by a court of
competent jurisdiction to be void or voidable for any reason, any rights of subrogation or
contribution such Indemnitor may have shall be junior and subordinate to the rights of each
Indemnitee against each Indemnitor.
5. Subro ag
tom. If Indemnitor fails to indemnify the Indemnitees as provided
in this Indemnity, the Indemnitees shall be subrogated to any rights Indemnitor may. have against
-third parties relating to the matters covered by this Indemnity..
6. Attorneys' Fees.
(a) Indemnitor shall reimburse each Indemnitee for all reasonable
attorneys' fees, costs and expenses, incurred by such Indemnitee in connection with the
enforcement of such Indemnitee's rights under his Agreement,. including,. without limitation,
reasonable attorneys' fees, costs and expenses for trial, appellate proceedings, out-of-court
negotiations, workouts and settlements or for enforcement of rights under any state or federal
statute, including, without limitation, reasonable attorneys' fees, costs and. expenses incurred to
protect such Indemnitee's security and attorneys' fees, costs and expenses incurred in bankruptcy
3
and insolvency proceedings such as (but not limited to) seeking relief from stay in a bankruptcy.
proceeding. The term "expenses" means any expenses incurred by any Indemnitee in connection
with any of the out-of-.court,. or state, federal or bankruptcy proceedings referred to above,
including, without limitation, the fees .and expenses of any, appraisers,. consultants and expert
witnesses retained or consulted by such Indemnitee in connection with any such proceeding.
(b) Indemnitee. shall also be entitled to its. attorneys' fees, costs and
expenses incurred in any post judgment proceedings to collect and enforce any judgment arising
out of this Agreement.. This provision is separate and several. and shall survive the merger of this
Agreement into any judgment on this Agreement.
7. Successors and Assigns. This Indemnity shall be binding upon
Indemnitor, its successors and. assigns, and shall inure to the benefit of and shall be enforceable
by each Indemnitee, its successors, and assigns (including, without limitation, any entity to
which the Lender assigns or sells- all or any portion of its .interest in the Note).
8. Notices. Any. notice, demand or request required under this Indemnity
shall be given in writing at the addresses set forth below by personal service; telecopy; overnight
courier; or registered or certified, first class mail, return receipt requested.
If to Indemnitor:
City of Vernon
4305-Santa Fe Avenue-
Vernon, California 90058
Attention: City Administrator
.Fax No. (323): 826-1438
If to Indemnitee:
East West Bank
135 N: Los Robles
Pasadena, California 91101
Attention: Flora Ling
Fax No:: (626) 817-8898
Such addresses may be changed by notice to the other parties given in the same manner as
required above. Any notice, demand or request shall be deemed received as follows: (a) if sent
by personal service, at the time such personal service is effected; (b) if sent by telecopy, upon the
sender's receipt of a confirmation report indicating receipt by the recipient's telecopier; (c) if sent
by overnight courier, on the business day immediately following deposit with the overnight
.courier; and (d) if sent by mail, three business days following deposit in the mail.
9. Separate Actions. Multiple actions may be brought and judgments
obtained under this Indemnity. A separate- and new right of action arises each time that a claim `
or liability arises under this Indemnity.
4
10. Governing Law. This Indemnity shall be governed and construed in
accordance with the laws of the State of California.
11. Severability. All provisions contained in this Indemnity are severable and
the invalidity or unenforceability of any provision shall not affect or impair the validity or
enforceability of the remaining provisions of this Indemnity.
12. Entire Agreement. This Indemnity constitutes the entire agreement and
supersedes all prior agreements and understandings, both written and oral, between the parties
with respect to the subject matter contained in this Indemnity.
13. Counterparts. This Indemnity may be executed in one or more
counterparts, each of which shall be deemed an original, and all. of which taken together shall
constitute one and the same agreement.
(Signatures on next page)
5
-CITY OF VERNON,
a municipal corporation
' By:
Name:
Title:
ATTEST:.
By:
City Clerk
APPROVED AS TO FORM:
City Attorney
S-1
Signature Page to Environmental Indemnity
PROMISSORY NOTE
May 7, 2009
Pasadena, California
$6,370,000
FOR VALUE RECEIVED, CITY OF VERNON, a California municipal corporation
("Maker"), having. its principal place of business at 4305 Santa Fe Avenue, Vernon, California
90058, promises to pay to the order of EAST WEST BANK, a California banking corporation
("Payee"), at 135 N. Los Robles, Pasadena, CA 91101, or at such other place as the holder of
this.Note from time to time may designate in writing, the principal sum of Six Million Three
Hundred Seventy Thousand Dollars ($6,370,000), or so much of such amount as `may from time
to time be disbursed and unpaid, together with interest on the unpaid principal amount of this
Note from-time to time outstanding in lawful money of the United States of America, all as
provided in the Loan Agreement dated as of May 7, 2009 between Maker and Payee (the "Loan
Agreement").
1. Reference to Loan Agreement. This Note evidences the loan made under the.
Loan Agreement. The loan- shall be disbursed, bear interest and mature, and Maker-shall pay.
interest and repay principal all as provided in the Loan Agreement.
2. Loan Documents. This Note, the Loan Agreement and all other documents,
agreements and instruments evidencing or delivered in connection with the loans made pursuant
to this Note are collectively referred to in this Note as the "Loan Documents."
3. Late Charges. If any installment of principal or interest or any other amount due
under this Note or the other Loan Documents shall become overdue for a period longer thanl l
days, Maker shall pay to Payee a late. charge of eight cents for each dollar. so overdue. Maker
acknowledges that late payment to Payee will .cause Payee to incur costs it would not have to
incur had payment been timely made, the exact.amount of such costs being difficult and-
impracticable to assess. Such costs include, without limitation, processing and accounting
charges and the potential costs to be incurred as a result of Payee's frustration and inability to
meet its other commitments. The parties agree that the late charges represent a reasonable sum
.considering all of the circumstances existing as of the date of this Note and represent a fair and
reasonable estimate of the costs that Payee will incur by reason of late payment. The parties
further agree that proof of actual damages would be costly and inconvenient.{ Acceptance of any
late charge shall not constitute a waiver of the default with respect to the overdue amount, and
shall not prevent Payee from exercising any of the other rights and remedies- available to Payee..
The late charges shall be due and payable immediately without demand and shall be secured by
the Loan Documents.
4. Event of Default. Upon the occurrence and during the continuance of any "Event
of Default" (as defined in the Loan Agreement), Payee,. at its option, may:
1
(a) collect interest. on the entire unpaid principal amount of this Note from
time to time outstanding at the default rate of interest provided. for in Section 2.6 of the Loan
Agreement from the occurrence of such Event of Default;
(b) declare all of Maker's obligations under this Note and any other Loan
Document to be immediately due and payable, without notice; notice being expressly waived;
and
{c) pursue each other right, remedy and power available to it under this Note
or any. of the other Loan Documents or available to it at law or in equity.
5. Remedies. The rights, remedies and powers of Payee;. as provided in this Note
and the other Loan Documents, are cumulative and concurrent, and may be pursued singly,
successively or together against Maker, the property .described in any of the Loan Documents
and any other security given atany time to secure the payment of Maker's obligations, all at the
sole discretion of Payee. Payee may resort to every other right or remedy available at law or in
equity without first exhausting the rights and remedies contained in this Note or .the other Loan
Documents, ali in Payee's sole .discretion. Failure of Payee, for any period of time or on more
than one occasion, to exercise its option to accelerate the maturity of this Note shall not
constitute a waiver of the right to exercise such right at any time during the. continued existence
of any. Event of Default under any of the Loan Documents or in the event of any subsequent
Event of Default under this Note or any of the other Loan Documents.. Payee shall not by any
other omission or act be deemed to waive any of its rights or remedies under the this Note or the
other Loan Documents unless such waiver is contained in a writing signed by Payee, andthen
only to the extent specifically-set forth in such writing. A waiver in connection with one event
shall not be construed as continuing or as a bar to or waiver of any right or remedy in connection ,
with a subsequent event.
6. Waivers and Consents. Maker and each endorser; surety or accommodation party
of this Note and each other person liable or to become liable for any part of the indebtedness
evidenced by this Note, waive presentment for payment, demand, notice of nonpayment, notice
of dishonor, protest of any dishonor, notice of protest and protest of this Note; and all other
notices in connection with the delivery, acceptance; performance; default or enforcement of the
payment of this Note, and agree that their liability shall be unconditional and without regard to
the liability of any other party and shall not be in any manner affected by any indulgence,
extension of time, renewal, waiver or modification. granted or consented to by Payee. Maker and
each such endorser, surety; accommodation party and person- liable or to become liable further
consent to every extension of time, renewal, waiver or modification that may be granted by
Payee with respect to the payment or other provisions of this Note, and to the release of any
collateral given to secure the payment-of amounts owingunder this Note, with or without
substitution, and agree that additional makers or endorsers may become parties to this Note
without notice. to Maker or any other parties and without affecting the liability of Maker. or any
other parties under this Note.
2
7. ..Miscellaneous.
(a) Governin ..Law: All questions with respect to the construction of this
Note and the rights and liabilities of the parties to this Note shall be governed by the laws of the
State of California.
(b) Binding on Successors.. This Note shall inure to the benefit of, and shall
be binding upon, the successors and assigns of each of the parties. to this Note.
(c) Attorne sue.
(i) Maker shall reimburse-Payee for all reasonable attorneys' fees,
costs and expenses (including those of in-house counsel), incurred by Payee in connection with
the enforcement of Payee's rights under this Note and each of the other Loan Documents,
including, without limitation, reasonable attorneys' fees, costs and expenses for trial, appellate
proceedings, out-of-court negotiations, workouts and settlements or for enforcement of rights
under any state or federal statute, including, without limitation, reasonable attorneys' fees, costs
and expenses incurred to protect Payee's security and attorneys' fees, costs and expenses incurred
in bankruptcy and insolvency proceedings such as (but not limited to) seeking relief from stay in
a bankruptcy proceeding. The term "expenses" means any expenses incurred by Payee in
connection with any of the out-of-court, or state, federal or bankruptcy proceedings referred to
above,'including, without limitation, the fees and expenses of any appraisers, consultants and
expert witnesses retained or consulted by Payee in connection with any such proceeding.
(ii) Payee shall also be entitled to its attorneys' fees, costs and-
expenses incurred in any post judgment proceedings to collect and enforce the judgment. This
provision is separate and several and shall survive the merger of this Note into any judgment on
this Note..
(d) Entire. Agreement.. This Note and the other Loan Documents constitute
the entire agreement and understanding between and. among the parties in respect,of the subject
matter of such agreements and supersede all prior agreements and understandings with respect to
such subject matter, whether oral or written.
(e) Waivers. Waiver by Payee of any term, covenant or condition under this
Note or the other Loan Documents, or of any default by Maker under this Note or the other Loan
Documents, or any failure by -Payee to insist upon strict performance by Maker of any term,
covenant or condition contained in this Note or the other Loan Documents, shall be effective or
binding on Payee only if made in writing by Payee; no such waiver shall be implied from any
omission by Payee to take action with respect to any such term, covenant, condition or default.
No express written waiver by Payee of any term; covenant,- condition or default shall affect any
other term, covenant, condition or default or cover any other time period than the application of
any such term, covenant or condition to the matter as to which a waiver has been given or the
default or time period specified in such express waiver. This Note may be amended only by an
instrument in writing signed by Maker and Payee.
3
(f) Severability. If any part of this Note is declared invalid for any reason,
such shall not affect the validity of the rest of the Note. The other parts of this Note shall-remain
in effect as if this Note had been executed without the invalid part. The parties declare that they
intend and desire that the remaining. parts of this Note continue to be effective without any part
or parts that have been declared invalid.
8. Waiver of Trial by Jury. MAKER-AND PAYEE WAIVE TRIAL BY JURY
WITH RESPECT TO ANY ACTION, CLAIM, SUIT OR PROCEEDING IN RESPECT
OF OR ARISING OUT OF THIS NOTE OR THE OTHER LOAN DOCUMENTS OR
THE CONDUCT OF THE RELATIONSHIP BETWEEN PAYEE AND MAKER.
MAKER AND PAYEE HAVE OBTAINED THE ADVICE OF THEIR RESPECTIVE
LEGAL COUNSEL BEFORE SIGNING THIS NOTE AND ACKNOWLEDGE THAT
THEY VOLUNTARILY AGREED TO THIS WAIVER OF THEIR RIGHT TO A TRIAL
BY JURY WITH FULL KNOWLEDGE OF ITS SIGNIFICANCE AND LEGAL
CONSEQUENCE.
CITY OF VERNON,
a municipal corporation
By:
Name:
Title:
ATTEST:
By:
City Clerk
APPROVED AS TO FORM:
City Attorney
4
DISCLOSURE OP RIGHT TO RECEIVE A COPY OF AN APPRAISAL
::>::::>::s:::::#~r~i~~1::.1<>><<>:>:~»~~:i~~<::::::atu:>...-::::~:><:»>::::><::la~>:~lo:>>:::~>:.>::<:><>:~::<t:~~n:::::>::::>::::::::»::»::A~un~<:<>::><:>::::::>:::4~c~:r::<:::>~:::>I:.
ts::::;::;:
~ tlr .Oqi?«~itl...... C#~ 2~#I!9.... ~ ~~'i.4.. ........~'F'~#.......
References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing has been omitted due to text length limitations.
Applicant: City of Vernon, a MunicipaF Corporation Lender: East West Bank
4305 Santa Fe Avenue Loan Servicing Department
Vernon, CA 90058 9300 Flair Drive
EI Monte, CA 91731
Disclosure of Rightto Receive a Copy of an Appraisal
Application. Number: 29332 Loan-Number: 29332
You have the right to a copy of the appraisal report used in connection with your application for credit. If you wish to have a copy, please write
to us at the following mailing address East West Bank Appraisal Department 9300 Flair Drive, 6th Floor EI Monte, CA 91731. We -must hear
from you no later than ninety (90) days after we notify you about the action taken on your credit application or no later than ninety (90) days
after you withdraw your application.
In your letter, -give us the following information:
Borrovver's name, property address and loan number
Upon your request, the appraisal reporE will be sent to;
4305 Santa Fe Avenue
Vernon, CA 90058 -
Cosfs of Providing the Appraisal .Copy: You are required to pay the cost of the appraisal.
APPLICANT ACKNOWLEDGMENT
I acknovvledge that I have received a copy of this Disclosure of Right to Receive a Copy of an Appraisal.
APPLICANT:
CITY OF VERNON, A MUNICIPAL CORPORATION
By: By:
Leonis C. Malburg, Mayor of City : of Date Manuela Giron, City Clerk of City of Date
Vernon, a Municipal Corporation Vernon, a Municipal Corporation
By. -
Jeff A. Harrison, City Attorney of City of Date
Vernon, a Municipal Corporation
LASER PRO Lending, Vei. 5.44.00.002 Copr. Harland PinenGal Splugone, Inc. 199], 2009. All Righk Reserved. - CA G:WPP5IEWRCFIICFIILPL\B14.FC TR-0193 PR~1
HAZARD INSURANCE DISCLOSURE
::.:..;._~~frici : ~i:;: -~a~lt:..~~;;:;:::... xtnatt~.r~. ...:!«r~~~ N
......1? ................................................................................_~!±`................................~..:.;:::..::.>~.;:.~::::...att..t_~~?1:::::::;::.::;:.:::...:::.-,.A~
ztu><'t't..:;::.::.:..:.. ~ t t
........i~f~r..........~~i~..a..~.......
..............................................................................................81.~~..:................:....:.::::.:.:::.
References iri the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing has been omitted due toQext length limitations.
Borrower: City of Vernon, a Municipal Corporation Lender: East West Bank
4305 Santa Fe Avenue Loan Servicing Department
Vernon, CA 90058 9300 Flair Drive
EI Monte, CA 91731
HAZARD INSURANCE DISCLOSURE
Made Pursuant to California Civil Code Section 2955.5.
IMPORTANT
DO NOT SIGN THIS FORM UNTIL YOU CAREFULLY
-READ IT AND UNDERSTAND ITS CONTENT
You have applied for a loan or credit accommodation that wilt be secured by real property. As a condition of the
loan or credif accommodation, Lender may require you to maintain hazard insurance coverage for the real property.
California law rovides that Lender cannot require you, as a condition of receivin or maintalning a loan secured by
real property, ~o provide hazard insurance coverage against risks to the property such as fire and. other perils) in an
amount exceeding the replacement value of the building or structures attached to the property..
BY SIGNING BELOW, YOU ACKNOWLEDGE THAT YOU HAVE READ, RECEIVED AND UNDERSTAND THIS
HAZARD INSURANCE DISCLOSURE. THIS DISCLOSURE IS DATED MAY 7, 2009.
BORROWER: `
CITY OF VERNON, A MUNICIPAL CORPORATION
By: By:
Leonis C. Malburg, Mayor of City of Vernon, a Manuela Giron, City Clerk- of City of Vernon, a
Municipal Corporation - Municipal Corporation
By:
Jeff A. Harrison, City Attorney of City of Vernon, a
Municipal Corporation
LASER PRO LentlinB. Yer, 5.44.OO.OD~ Copr. Harlantl Flnenclel SdWons, Inc. 199], 2009. All Rights Reservetl. - CA G.MPPStEWBCFItCFILLPL1819.FC TR-8143 PR-1
ASSIGNMENT Of° DEPOSIT. ACCOUNT
373 ~?v~Jx~t~ ::::~~-a~: -Q~~.. ~#~~.4.. ..................................~~7#~.......
References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing has been omitted due to text length limitations.
Grantor: City of Vernon, a Municipal Corporation Lender: East West Bank
4305 Santa Fe Avenue Loan Servicing Department
Vernon, CA 90058 9300 Flair Drive
EI Monte, CA 91731
THIS ASSIGNMENT OF DEPOSIT ACCOUNT dated May 7, 2009, is made and executed between City of Vernon, a Municipal Corporation
("Grantor") and East West Bank ("Lender").
ASSIGNMENT. For valuable consideration, Grantor assigns and grants to Lender a security interest in the Collateral, including without limitation
the deposit accounts described below, to secure the Indebtedness and agrees that Lender shall have the rights stated in this Agreement with
respect to the Collateral, in addition to all other rights which Lender may have by law.
COLLATERAL DESCRIPTION. The word "Collateral" means the following described deposit account ("Account"):
Checking Account Number 80359722 with Lender for interest reserve
together with (A} all interest, whether now accrued or hereafter accruing; (B) all additional deposits hereafter made to the Account; (C) any
and all proceeds from the Account; and (D) all renewals, replacements and substitutions for any of the foregoing.
CROSS-COLLATERALIZATION. In addition to the Note, this Agreement-secures all obligations, debts and liabilities; plus interest thereon, of
Grantor to Lender, or any one or more of them, as well as all claims by Lender against Grantor or any one or more of them, whether now
existing or hereafter arising, whether related or unrelated to the purpose of the -Note, whether voluntary or otherwise, whether due or not due,
direct or indirect, determined or undetermined, absolute or contingent, liquidated or unliquidated, whether Grantor may be liable individually or
jointly with others, whether obligated as guarantor, surety, accommodation party or otherwise, and whether recovery upon such amounts may
be or hereafter may become barred by any-.statute of limitations, and whether the obligation to repay such amounts may be or hereafter-may
become otherwise unenforceable.
GRANTOR'S REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE COLLATERAL. With respect to the Collateral, Grantor represents
and promises to Lender that:
Ownership. Grantor is the lawful owner of the Collateral free and clear of all loans, Jiens, encumbrances, and claims except as disclosed to
and accepted by Lender in writing.
Right to Grant Security Interest. Grantor has the full. right, power, and authority to enter into this Agreement and to assign the Collateral to
Lender.
No Prior Assignment. Grantor has not previously granted a security interest in the Collateral to any other creditor.-
No Further Transfer.. Grantor shall not sell, assign,. encumber, or otherwise dispose of any of Grantor's rights in the Collateral except as
provided in this Agreement.
No Defaults. There are no defaults relating to the Collateral, and there are no offsets or counterclaims to the same. Grantor will strictly
and promptly do everything required of Grantor under the terms, conditions, promises, and agreements contained in or relating to the '
Collateral.
Proceeds. Any and all replacement'or renewal certificates, instruments, or other benefits or proceeds related to the Collateral that are
received by Grantor shall be held by Grantor in trust for Lender and immediately. shall be delivered by Grantor to Lender to be held as part
of the Collateral.
.Validity; Binding Effect. This Agreement is binding upon Grantor and Grantor's successors and assigns and is legally enforceable in
accordance with its terms.
Financing Statements. Grantor authorizes Lender to file a UCC financing statement,'or alternatively, a copy of this Agreement to pertect
Lender's security interest. At Lender's request, Grantor additionally agrees to sigrt al( other documents that are. necessary to perfect,
protect; and continue Lender's security interest. in the Property. This includes making sure Lender is shown as the first and only security
interest holder on the title covering the Property.. Grantor will pay all filing fees, title transfer fees, and other fees and costs involved unless
prohibited by law or unless Lender is required- by iaw to pay such fees and costs. Grantor irrevocably appoints Lender to execute
documents necessary to transfer title if there is a default. Lender may file a copy of this Agreement as a financing statement. If Grantor
changes Grantor's. name or address, or the name or address of any person granting. a security interest under this Agreement changes,
Grantor will promptly notify the Lender of such change.
LENDER'S RIGHTS AND OBLIGATIONS WITH RESPECT TO THE COLLATERAL. While this Agreement is in effect, Lender may retain the rights.
to possession of the Collateral, together with any and all evidence of the Collateral, such as certificates or passbooks. This Agreement will
remain in effect until '(a) there no longer is any Indebtedness owing to Lender; (b) all other obligations secured by this Agreement have been
fulfilled; and (c) Grantor, in writing, has requested from Lender a release of this Agreement.
LENDER'S EXPENDITURES. If any action or proceeding is commenced that would materially affect Lender's interest iri the Collateral or if
Grantor fails to comply with any provision of this Agreement or any Related Documents, including but not limited to Grantor's failure to
discharge or pay when due any amounts Grantor is .required to discharge or pay under this Agreement or any Related Documents, Lender on
Grantor's behalf may (but shall not be obligated to) take any action that Lender deems appropriate, including but not limited to discharging or
paying all taxes; liens, security interests, .encumbrances and other claims, at any time levied or placed on the Collateral and paying all costs for
insuring,.maintaining and preserving the Collateral. All such expenditures incurred or paid by Lender for such purposes will then bear interest at
the rate charged under the Note from the date incurred or paid by Lender to the date of repayment by Grantor. All such expenses will become a
part of the Indebtedness and, at Lender's option; will (A) be payable on demand; (B) be added to the balance of the Note and be apportioned
among and be payable with any installment payments to become due during either (1) the term of any applicable insurance policy; or (2) the
remaining term of the Note; or (G) be treated as a balloon payment which will be due and payable at the Note's maturity.. The Agreement also.
will secure payment of these amounts. Such right shall be in addition to all other. rights and :remedies to which :Lender may be entitled upon
Default.
LIMITATIONS ON OBLIGATIONS OF LENDER. Lender shall use ordinary reasonable care in the physical preservation and custody of any
ASSIGNMENT OF DEPOSIT. ACCOUNT
-Loan No: 29332 (Continued) Page 2
certificate or passbook for the Collateral buf shall have no other obligation. to protect the Collateral or its value. In particular, but without
limitation, Lender shall. have no responsibility (A) for the. collection or protection of any income on the Collateral; (B) for the preservation of
rights against issuers of the Collateral or against third persons; (C} for ascertaining any maturities, conversions, exchanges, offers, tenders, or
.similar matters relating to the Collateral; nor (D) for informing the Grantor about any of the above, whether or not Lender has or is deemed to
have knowledge of such matters.
DEFAULT. Each of the following shall constitute an Event of Default under this Agreement:
Payment Default. Grantor fails to make any .payment when due under the Indebtedness.
Other Defaults. Grantor fails to comply with or to ,perform any other term, obligation, covenant or condition contained in this Agreement or
in any of the Related Documents or to comply with or to perform any term, obligation, covenant or condition contained in any other
agreement between Lender and Grantor.
Default in Favor of Third Parties. Grantor defaults under any loan, extension of credit, security agreement, purchase or sales agreement, or
any other agreement, in favor of any other creditor or person that may materially affect .any of Grantor's property or ability to perform
Grantor's obligations under this Agreement or any of the Related Documents.
False Statements. -Any warranty, representation or statement made or furnished to Lender by Grantor or on Grantor's behalf under this
Agreement or the Related Documents is false or misleading in any material respect, either now or at the time made or furnished or becomes
false or misleading at any time thereafter.
Defective Collateralizatlon. This .Agreement or any of the Related Documents ceases to be in full force and -effect (including failure of any
collateral document to create a valid and pertected security interest or lien). at anytime and for any reason.
Insolvency. The dissolution or termination of Grantor's existence as a going business, the insolvency of Grantor, the appointment of a
receiver for any part of Grantor's property, anyaSSignment for the benefit of creditors, any type of creditor workout, or the commencement
of any proceeding under any bankruptcy or insolvency laws by or against Grantor. :
Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help,:
repossession or any .other method, by any creditor of Grantor or by any governmental agency against any collateral securing the
Indebtedness. This includes a garnishment of any of Grantor's accounts, including deposit accounts, with Lender. However, this Event of
Default shall not apply if there is a good faith dispute by Grantor as to the validity or reasonableness of the claim which is the basis of the
creditor or forfeiture proceeding and if Grantor gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender
monies or a surety bond for the creditor or forfeiture. proceeding, in an amount determined by Lender, in its sole.discretion, as being an
adequate reserve or bond for the dispute.
Events Affecting Guarantor. Any of the preceding events occurs with respect to any guarantor,. endorser, surety, or accommodation party
of any of the Indebtedness or guarantor, endorser, surety, or accommodation party dies or becomes incompetent or revokes or disputes the
validity of, or liability under, any Guaranty of the Indebtedness.
Adverse Change. A material adverse change occurs in Grantor's financial. condition, 'or Lender believes the prospect of payment or
performance of the Indebtedness is impaired.
Cure Provisions. If any default, other than a default in payment is curable and if Grantor has not been given a notice of a breach of the
.same provision of this Agreement within the preceding twelve (12) months, it may be cured if Grantor, after receiving written notice from
Lender demanding cure of such default: (1) cures the default within fifteen (15) days; or (2) if the cure requires more than fifteen (15)
days, immediately initiates steps which Lender deems in Lender's sole discretion to be sufficient to cure the. default and thereafter
continues and completes all reasonable. and necessary steps sufficient to produce compliance as soon as reasonably practical
RIGHTS AND REMEDIES ON DEFAULT. Upon the occurrence of an Event of Default, or at any time thereafter, Lender may exercise any one or ,
more of the following rights and remedies, in addition to any rights or remedies that may be available at law, in equity, or otherwise:
Accelerate Indebtedness. Lender may declare all Indebtedness of Grantor to Lender immediately due and payable, without notice of any
kind to Grantor.
Application of Account Proceeds. Lender may take- directly alt funds in the Account and apply them to the Indebtedness.. If the Account is
subject to an early withdrawal penalty, that penalty shall be deducted from the Account before its application to the Indebtedness, whether
the Account is with Lender or some other institution.. Any excess funds remaining -after application of the Account proceeds to the
indebtedness will be .paid to Grantor. as the interests of Grantor may appear. Grantor agrees, to the extent permitted by law, to pay any
deficiencyafter application of the proceeds of the Account to the Indebtedness. Lender also shall have all the rights of a secured party
under the California Uniform Commercial .Code, -even if the Account is not otherwise subject to such Code concerning security .interests,
and the parties to this Agreement agree that the provisions of the Code giving rights to a secured party shall nonetheless be a part of this
Agreement.
Transfer Title. Lender may effect transfer of title upon sale of all or part of the Collateral. For this purpose, Grantor irrevocably appoints
Lender as Grantor's attorney-in-fact to execute endorsements, assignments and instruments in the name of Grantor and each of them (if
more than one) as shall be necessary or reasonable.
Other Rights and' Remedies. Lender shall have and may exercise any or all of the rights anii remedies of a secured creditor under the
provisions of the California Uniform Commercial Code, at law, in equity, or otherwise.
Deficiency Judgment. if permitted by applicable law, Lender may obtain a judgment for any deficiency remaining in the Indebtedness due
to Lender after application of all amounts received from the exercise of the rights provided in this section.
Election of Remedies. Except as may be prohibited by applicable law, all of Lender's rights and remedies, whether evidenced by this
Agreement or by any, other writing,. shall be cumulative and may be exercised singularly or concurrently. Election by Lender to pursue .any
remedy shall not exclude pursuit of any other remedy, and an election to:make expenditures or to take action 4o perform an obligation of
Grantor under this Agreement, after Grantor's failure to pertorm, shall not .affect Lender's right to declare a default and exercise its
remedies.
Cumulative Remedies. All of Lender's rights and remedies, whether evidenced by this Agreement or by any other- writing, shall be
cumulative and may be exercised singularly or concurrently.. Election by Lender to pursue any remedy shall not exclude pursuit of any other
remedy, and an election to make expenditures or to take action to perform an obligation of Grantor under this Agreement, after Grantor's
failure to perform, shall not affect Lender's7ightto declare a default and to exercise its remedies.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Agreement:
Amendments. This Agreement, together with any Related. Documents, constitutes the entire understanding and agreement of the parties
ASSIGNMENT'OF DEPOSIT ACCOUNT
Loan No: 29332 (Continued) Page 3
as to the matters set forth in this Agreement. No alteration of or amendment to this Agreement shall be effective unless given in writing
and signed by the party or parties sought to be charged or bound by the alteration or amendment.
Attorneys' Fees; Expenses. Grantor agrees to pay upon demand-all of Lender's-costs and expenses, including Lender's attorneys' fees and
Lender's legal expenses, incurred. in connection with the enforcement of this Agreement. Lender may hire or pay someone else to help
enforce this Agreement, and Grantor shall -pay the costs and expenses of such enforcement. Costs and expenses include Lender's
attorneys'. fees and .legal expenses whether or not there is a lawsuit, including attorneys' fees and legal expenses for bankruptcy
proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post-judgment collection
services. Grantor also shall pay all court costs and such additional fees as may be directed by the court. -
Caption Headings. Caption headings in this Agreement are for convenience purposes only and are not to be used to interpret or define the
provisions of this Agreement.
Governing Law. This Agreement will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the
laws of the State of California without regard to its conflicts of law provisions. This Agreement has-been accepted by Lender in the State
of California.
Preference Payments. Any monies Lender pays because of an asserted preference claim in Grantor's bankruptcy will become a part of the
Indebtedness and, at Lender's option, shall be payable by Grantor as provided in this Agreement.
No Waiver by Lender. Lender shall not be deemed to have waived any rights under this Agreement unless such waiver is given in writing
and signed by Lender. No delay or omission on the part of Lender'in exercising any light shall operate as a waiver of such right or any
-other right. A waiver by Lender of a provision of this Agreement shall not prejudice or constitute a waiver of Lender's right otherwise to
demand strict compliance with that provision or any other provision of this Agreement. No prior waiver by Lender, nor any course of
dealing between Lender and Grantor, shall constitute a waiver of any of Lender's rights or of any of Grantor's obligations as to any future
transactions. Whenever the consent of Lender is required under this Agreement, the granting of such consent by Lender in any instance
- shall not constitute continuing consent to subsequent instances where such consent is required and in all cases such consent may be
granted or withheld in the sole discretion of Lender.
Notices. Any notice required to be given under this Agreement shall be given in writing, and shall be effective when actually delivered,
when actually received by telefacsimile (unless otherwise required by law), when deposited with a nationally recognized overnight courier,
or, if mailed, when deposited in the United States mail, as first class, certified or registered mail postage prepaid, directed to the addresses
shown near the beginning of this Agreement. 'Any party may change its address for notices under this Agreement by giving formal written
notice to the other parties, specifying that the purpose. of the notice is to change the party's address. ,.For notice purposes, Grantor agrees
to keep Lender informed at all times of Grantor's current address. Unless otherwise provided or required by law, if there is more than one
Grantor, any notice given by Lender to any Grantor is deemed to be notice given to all Grantors.
Power of Attorney. Grantor hereby appoints. Lender as its. true and lawful attorney-in-fact, irrevocably, with full power of substitution to do
the following: (1) to demand, collect, receive, receipt for, sue and recover all sums of money or other property which may now or
hereafter become due, owing or payable from the Collateral; (2) to execute, sign and endorse any and all claims, instruments, receipts,
checks, drafts or warrants issued in payment for the Collateral; (3) to settle or compromise any and all claims arising under the Collateral,
and in the place and stead of Grantor, to execute and deliver its release and settlement for the claim; and (4) to file any claim or claims or
to take any action or institute or take part in any proceedings, either in its own name or inthe name of Grantor, or otherwise, which in the
discretion of Lender may seem to be necessary or advisable. This power is given as security for the Indebtedness, and the authority hereby
conferred is and shall be irrevocable and shall remain in full force and effect until renounced by Lender.
Waiver of Co•Obligor's Rights.' If more than one person is obligated for the indebtedness, Grantor irrevocably waives, disclaims and
relinquishes all claims against such other person which Grantor has or would otherwise have by virtue of payment of the Indebtedness or
any part thereof, specifically including but not limited to all rights of indemnity, contribution or exoneration.
5everability. If a court of competent jurisdiction finds any provision of this Agreement to be illegal, invalid, or unenforceable as to any
circumstance, that finding shall not make the offending provision illegal, invalid, or unenforceable as to any other circumstance. If feasible,
the offending provision shall be considered modified so that it becomes legal, valid and enforceable. If the offending provision cannotbe so
modified, it shall be considered deleted from this Agreement. Unless otherwise required by law, the illegality, invalidity, or unenforceability
of any provision of this Agreement shall not affect the legality, validity or enforceability of any other provision of this Agreement.
Successors and Assigns. Subject to any limitations stated in this Agreement on transfer of Grantor's interest, this Agreement shall be
binding upon and inure to the benefit of the parties, their successors and assigns. If ownership of the Collateral becomes vested in a
person other than Grantor, Lender, without notice to Grantor, may deal with Grantor's successors with reference to this Agreement and the
Indebtedness by way of forbearance or extension without releasing Grantor from the obligations of this Agreement or liability under the
Indebtedness.
Survival of Representations and Warranties. All representations, warranties, and agreements made by Grantor in this Agreement .shall
survive the execution and delivery of this Agreement, shall be continuing in nature, and shall remain in full force and effect until -such time
as Grantor's Indebtedness shall be paid in full
Time is of the Essence. Time is of the essence in the performance of this Agreement.
Waive Jury. To the extent permitted by applicable law, all parties to this Agreement hereby waive the right to any jury trial In any action,
proceeding, or counterclaim brought by any party against any other party.
DEFINITIONS. The following capitalized words and. terms shall have the following meanings when used in this Agreement. Unless specifically
stated to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and terms
used in the singular shall include the plural, and the plural shall include the singular, as the context may require. Words and terms not otherwise
defined in this Agreement shall have the meanings attributed to such terms in the Uniform Commercial Code:
Account. The word "Account" means the deposit accounts described in the "Collateral Description" section.
Agreement. The word "Agreement" means this Assignment of Deposit Account, as this Assignment of Deposit Account may be amended
or modified from time to time, together with alf exhibits and schedules attached to this Assignment of Deposit Account from time to time.
Borrower. The word "Borrower" means City of Vemon, a Municipal Corporation and includes all co-signers and co-makers signing the Note
and all their successors and assigns:
Collateral. The word "Collateral" means all of Grantor's right, title and interest in and to all the Collateral as described in the Collateral
Description section of this Agreement.
Default. The word "Default" means the Default set forth in this Agreement in the section titled "Default".
ASSIGNMENT OF DEPOSIT ACCOUNT
Loan Na 29332 (Continued) Page 4
Event of Default. The words "Event of Default" mean any of the events of default set forth in this Agreement in the default section of this
Agreement.
Grantor. ,The word "Grantor" means City of Vernon, a Municipal Corporation.
Guaranty. The word "Guaranty" means the guaranty from guarantor, endorser, surety, or accommodation party to Lender; including
without limitation a guaranty of all' or part of the Note.
Indebtedness. The. word "Indebtedness" means the indebtedness evidenced by the Note or Related Documents, including. all. principal and
interest together with all other indebtedness and costs and expenses for which Graritor is responsible under this Agreement or under any of
the Related Documents. Specifically, without limitation, Indebtedness includes all- amounts that may be indirectly secured by the
Cross-Collateralization provision of this Agreement. :
Lender. The word "Lender" -means East West Bank, its successors and assigns.
Note. The word "Note" means the Note executed by City of Vernon; a Municipal Corporation in the principal amount of $6,370,000.00
dated May 7, 2009, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for
the note or credit agreement.
Property. The word "Property" means all of Grantor's right, title and interest in and to all the Property as described in the "Collateral
Description" section of this Agreement.
Related Documents. The words "Related Documents" mean all promissory notes, credit agreements, loan agreements, environmental
agreements, security agreements, mortgages, deeds of trust, security. deeds,- collateral. mortgages, and all other instruments, agreements
and .documents, whether now or hereafter existing, executed: in connection with. the Indebtedness.
GRANTOR HAS READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS ASSIGNMENT OF DEPOSIT ACCOUNT AND AGREES TO ITS
TERMS. THIS AGREEMENT IS DATED MAY 7, 2009.
GRANTOR:
CITY OF VERNON, A MUNICIPAL CORPORATION
By: By:
LeoniS C. Malburg, Mayor of City of Vernon, a . Manuela Giron, City Clerk of .City of Vernon; a
Municipal Corporation` Municipal Corporation
By:
.Jeff A. Harrison, City Attorney of Clty of Vernon, a
Municipal Corporation
LASER Pq0 Lentling, Ver. 5.44.00.002 Capr. Rerlentl Finenclal Solullons, Inc. iBB], 2009. All Rlghis Reservetl. - CA G:\APP5rEWBCFI~CFBLPL\E90.FC TR~9143 PR-t
RECORDATION REQUESTED BY:
East West Bank
Loan Servicing Department
9300 Flair Drive
EI Monte, CA 91731
WHEN- RECORDED MAIL TO:
East West Bank
Loan Service Department
9300 Flair Drive, 6th Floor
EI Monte, CA 91731
FOR RECORDER'S USE ONLY
DEED OF TRUST
THIS DEED OF TRUST is dated May 7, 2009, among The City of Vernon, A Body Corporate and Body and
Politic ("Trustor"); East West Bank, whose address is-Loan Servicing. Department, 9300 Flair Drive, EI Monte,
CA 91731 .(referred to below sometimes as "Lender" and .sometimes as "Beneficiary"); and EAST WEST
INVESTMENT INC., A CALIFORNIA CORPORATION ,whose address is 9300 Flair Drive, 6th Floor, EI Monte,
CA 91731 (referred to below as "Trustee").
CONVEYANCE AND GRANT. For valuable consideration, Trustor irrevocably grants, transfers and assigns to Trustee in trust, with power
of sale, for the benefit of Lender as Beneficiary, all of Trustor's right; title, and interest in -and to the following described real property,
together with .all existing or subsequently erected or affixed buildings, improvements and fixtures, all easements, rights of way, and
appurtenances; all. water, water rights and ditch rights (including stock ih utilities with ditch or irrigation- rights); and all other ri hts,
royalties, and profits relating to the real property, .including without limitation all minerals, oil, gas, geothermal and similar matters, the
"Real Property") located in Los Angeles County, State of California:
See Exhibit "A", which is attached to this Deed of Trust and made a part of this Deed of Trust as if fully
.set forth herein.
The Real Property or its. address is commonly known as 4855 East 52nd Place, Vernon, CA 90058-5507.
The Assessor's Parcel Number for the Real Property i~ 6314-019-900; 6314-022-900 and 6314-023-270.
Trustor presently assigns to Lender (also known as Beneficiary in this Deed of Trust) all of Trustor's right,. title, and interest ih and to all
present and .future leases of the Property and all Rents from. the Property. This is an absolute assignment of Rents made in connection
with an obligation secured by real property pursuant to California Civil Code Section 2938. In addition, Trustor grants to Lender a Uniform
Commercial Code security. interest in the Personal Property and Rents.
THIS .DEED OF TRUST, INCLUDING THE ASSIGNMENT DF RENTS AND THE SECURITY INTEREST IN THE RENTS AND PERSONAL
PROPERTY; IS GIVEN TO SECURE (A) PAYMENT OF THE INDEBTEDNESS AND (B) PERFORMANCE OF ANY AND ALL OBLIGATIONS
UNDER THE NOTE, THE RELATED DOCUMENTS, AND THIS DEED OF TRUST. -THIS DEED OF TRUST IS GIVEN AND ACCEPTED ON THE
FOLLOWING TERMS:
TRUSTOR'S REPRESENTATIONS AND WARRANTIES. Trustor warrants that: (a) this Deed of Trust is executed at Borrower's request and
not at the request of Lender; (b) Trustor has the full-power, right, and authority to enter into this Deed of Trust and to hypothecate the
Property; (c) the provisions of this Deed of Trust do not conflict with, or result in a default under any agreement or other instrument
binding upon Trustor and do not result in a violation. of. any law, regulation, court decree or order applicable to Trustor;. (d) Trustor has
established adequate means of obtaining from Borrower on a continuing basis information about Borrower's financial condition; and (e)
Lender has made no representation to Trustor about Borrower (including without limitation the creditworthiness of Borrower).
TRUSTOR'S WAIVERS. Except as prohibited by applicable law, Trustor waives any right to require Lender to (a) make any presentment,
protest, demand, or notice of any kind, including notice of change of any terms of repayment of the Indebtedness, default by Borrower or
any other guarantor or surety, any .action or nonaction taken, by- Borrower; Lender; or any other guarantor or surety of Borrower, or the
creation of new or additional Indebtedness; (b) proceed against any person, including Borrower, before proceeding against Trustor; (c)
proceed against any collateral for the- Indebtedness, including Borrower's collateral, before proceeding against Trustor; (d) apply any
payments or proceeds received against the Indebtedness in any order; (e) give notice of the terms, time, and place of any sale of any
collateral pursuant to the Uniform Commercial Code or any other law governing such sale;. (f) disclose any information about the
indebtedness, Borrower, any collateral, or any other guarantor or surety, or about any action or nohaction of Lender; or (g) pursue any
remedy or course of action in Lender's power. whatsoever.
Trustor also waives any and, all rights or defenses arising by reason of (h) any disability or other defense of Borrower, any other guarantor
or surety or any other person;. (i) the cessation from any cause whatsoever,-other than payment in full, of the Indebtedness; (j) the
application of proceeds of the Indebtedness by Borrower for purposes other than the purposes understood and intended by Trustor and
Lender, (k) any act of omission or commissionby Lender which directly or indirectly results in or contributes to the discharge of Borrower
or any other guarantor or surety, or the Indebtedness,. or the loss or release of any collateral by,operation of law or otherwise;. (I) any
statute of limitations in any action under this Deed of Trust or on the Indebtedness; or (m) any modification or change in terms of the
Indebtedness, whatsoever, including without limitation,.the. renewal, extension, acceleration, or other change in the time payment of the
Indebtedness is due and any change in the interest rate.
DEED OF TRUST
Loan No: 29332 (Continued) Page 2 •
Trustor waives all rights and defenses arising out of an election of remedies by Lender, even though that election of remedies, such as
non-judicial foreclosure with respect to security fora guaranteed obligation, has destroyed Trustor's rights of subrogation. and
reimbursement against Borrower by the operation of Section 580d.of the California Code of Civil Procedure, or otherwise.
Trustor waives all rights and defenses that Trustor may have because Borrower's obligation is secured by real property. -This means
among other things:. (1) Lender may collect from Trustor without first foreclosing on any real or personal property collateral pledged by
Borrower.- (2) If Lender forecloses on any real property collateral pledged by Borrower: (A) The amount of Borrower's obligation may be
reduced only byYhe price for which the collateral is sold at the foreclosure sale, even if-the collateral is "worth more than the sale price: (B)
Lender may collect from Trustor even if Lender, by foreclosing on the real property collateral, has destroyed any right Trustor may have to
collect from Borrower. This is an unconditional and irrevocable waiver of any rights and defenses Trustor may have because Borrower's
obligation is secured by real. property. These rights and defenses include,. but are not limited to, any rights and defenses based upon
.Section 580a, 580b, 580d, or 726 of the Code of Civil Procedure.
Trustor understands and agrees that the foregoing waivers are unconditional and irrevocable waivers of substantive rights and defenses to
which Trustor might otherwise be entitled under state and federal law. The rights and defenses waived include, without limitation, those
provided- by California laws of suretyship and guaranty, anti-deficiency laws, and the Uniform Commercial Code. Trustor acknowledges
that Trustor has provided these waivers of rights and defenses with the intention. that they be fully relied upon by Lender. Trustor further
understands and agrees that this Deed. of Trust is a separate and independent contract between Trustor and Lender, given for full and
ample consideration, and is enforceable on its own terms. Until all Indebtedness is .paid in full, Trustor waives any right to enforce any
remedy Trustor may have against Borrower's or ahy other guarantor, surety, or other person, and further; Trustor waives any right to
participate ih any collateral for the Indebtedness now or hereafter held by Lender.
PAYMENT AND PERFORMANCE.' Except as otherwise provided in this Deed of Trust, Borrower shall pay to Lender all Indebtedness
secured by this. Deed of Trust as it becomes due, and Borrower and Trustor shall perform all their respective obligations under the Note,
this Deed of Trust, and fhe Related Documents.
POSSESSION AND. MAINTENANCE OF THE PROPERTY. Borrower and Trustor agree that Borrower's and Trustor's possession and use of
the Property shall be governed by the following provisions:
Possession and Use. Until the occurrence of an Event of Default; Trustor may (1) remain in possession and control of the Property;
(2) use; operate or manage the Property; and (3) collect the Rents from the Property.
Duty to Maintain. Trustor shall maintain the Property in tenantable condition and promptly perform all repairs, replacements; and
maintenance necessary to preserve its value.
Compliance With Environmental Laws..Trustor represents and warrants to Lender that: (1) During the period of Trustor's ownership
of the Property, there has been no use, generation, manufacture, storage, treatment, disposal, release or threatened release of any
Hazardous Substance by any person on, under, about or from the Property; (2) Trustor has no knowledge of, or reason to believe
that there has been, except as previously disclosed to and acknowledged. by Lender in writing, (a) any breach or violation of any
Environmental Laws, (b) any use; generation, manufacture, storage, treatment, disposal, release or threatened release~of any
Hazardous"Substance on, under, about or'from the Property by any prior owners or occupants of the Property, or ' (c) -any actual or
threatened litigation or claims of any kind by any person relating to such matters; and (3) Except as previously disclosed to and
acknowledged by Lender in,writing; (a) neither Trustor nor any tenant; contractor, agent or other authorized user of the Properly
shall use, generate, manufacture; store, treat, dispose of or release any Hazardous Substance on, under, about or from the Property;
and (b) any such activity shall be conducted. in compliance with all applicable federal, state, and local laws, regulations and
ordinances, including without limitation all Environmental Laws. Trustor authorizes Lender and its agents to enter upon the Property
to make such inspections and tests, at Trustor's expense, as Lender may deem appropriate to determine compliance of the Property"
with this section ofi the Deed of Trust.- Any inspections or tests made by Lender shall be for Lender's purposes only and shall not be
construed- to create. any responsibility or liability on the part of Lender to Trustor or to any other person. The representations and
warranties contained herein are based ort Trustor's due diligence in investigating the Property for Hazardous Substances. Trustor"
hereby. (1) releases and waives any future claims against Lender for indemnity or contribution in the event Trustor becomes liable for
cleanup or other costs under any such laws; and (2) agrees to indemnify; defend, and hold harmless Lender against any and all
claims, losses, liabilities, damages, penalties, and expenses which Lendermay directly or indirectly sustain or suffer resulting from a
breach of this section of the Deed of Trust or as a consequence of any use, generation, manufacture,'storage, disposal, release or
threatened release occurring prior to Trustor's ownership or interest in the Property,- whether or not the same was or should have
been known to Trustor. .The provisions of this section of the Deed of Trust, including the obligation to indemnify and defend, shall
survive the payment of the Indebtedness and the satisfaction and reconveyance of the lien of this Deed of Trust and shall not be
affected: by Lender's acquisition of any interest in the Property, whether by foreclosure or otherwise:-
Nuisance, Waste. Trustor shall not cause, conduct or permit any nuisance nor commit,. permit, or suffer any stripping of or waste on
or to the Property or any portion of the Property..- Without limiting the generality of the foregoing, Trustor will not remove, or grant to
any other party the right to remove, any timber, minerals (including oil and gas), coal, clay, scoria, soil, gravel or rock products
without Lender's prior written consent.
Removal of Improvements. Trustor shall not demolish or remove any Improvements from the Real Property without Lender's prior
written consent.. As a condition to the removal of• any Improvements; Lender may require Trustor to make arrangements satisfactory
to Lender to replace such Improvements with Improvements of at least equal value.
Lender's -Right to Enter. Lender. and Lender's agents and representatives may enter upon the Real Property. at all reasonable times to
attend to Lender's interests and to inspect the .Real. Property for purposes of Trustor's compliance with the terms and conditions. of
this Deed of Trust.
Compliance with Governmental Requirements. Trustor shall promptly comply with all laws,. prdinances, and regulations, now or
hereafter in effect, of all governmental authorities applicable to the use or occupancy of the Property, including without limitation, the
Americans With Disabilities Act. Trustor may contest in good faith any such law, ordinance, or regulation and withhold compliance
during any proceeding, including appropriate appeals; so long as Trustor has notified Lender in writing prior to doing sound so long as,
DEED OF TRUST
Loan No: 29332. (COntlnued) Page 3
in Lender's sole opinion, Lender's interests in the Property are .not jeopardized. Lender may require Trustor to post adequate security
or a surety bond, reasonably satisfactory to Lender, to protect Lender's interest.
Duty to Protect. Trustor agrees neither to abandon or leave unattended the Property. Trustor shall do -alt other acts, in addition to
those acts set forth above in this section, which from the character and Use of the Property are reasonably necessary to protect and
preserve the Property..
DUE ON SALE -CONSENT BY LENDER. Lender may, at Lender's option, declare immediately due and payable all sums secured by this
Deed of7rust upon. the sale or transfer, without Lender's prior written consent, of all or any part of the Real Property, or any interest in the
Real Property. A "sale or transfer" means the conveyance of Real Property or any right, title or interest in the Real Property; whether legal,
beneficial or equitable; whether Voluntary or involuntary; whether by outright sale, deed, installment sale contract, land contract, contract.
for deed, leasehold interest with a term greater than three (3), years, lease-option contract, or by sale, assignment, or transfer of any
beneficial interestin or to any land trust holding title to the Real Property, or by any other method of conveyance of an interest in the Real
Property. if any Trustor is a corporation, partnership or limited liability company, transfer also include any change in ownership of more
than twenty-five percent (25%) of the voting stock, partnership interests or limited liability company interests, as the case may be, of such
Trustor. However,-this option shall hot be exercised by Lender if such exercise is prohibited by applicable law.
TAXES AND. LIENS. The following provisions relating to the taxes and liens om the Property are part of this. Deed of Trust:
Payment. Trustor shall pay when due (and in all events at least fen (10) days- prior to delinquency) all taxes, special taxes,
assessments, charges (including water and sewer), fines and impositions levied against or on account of the Property, and shall -pay
when .due all claims fo"r work done on or for services rendered or material furnished to the Property. Trustor shall maintain the
Property. free of all liens having priority over or equal to the interest of Lender under this Deed of Trust, except for-the lien of taxes
and assessments not due and except as otherwise provided in-this Deed of Trust.
Right to Contest. Trustor may withhold payment of any. tax, assessment, or claim in connection with a good faith dispute over the
obligation'to pay, so long as Lender's interest in the Property is not jeopardized. If a lien arises or is filed as a result of nonpayment,
Trustor shall within fifteen (15) days after the ..lien arises or, if a lien is filed,. within fifteen (15) days after Trustor has notice of the
filing, secure the discharge. of the lien, or if requested by Lender, deposit with Lender cash or a sufficient corporate surety bond or
'other security satisfactory to Lender in an amountsufficient to discharge the lien plus any costs and attorneys' fees, or other charges '
that could accrue as a result of a foreclosure or sale under the lien. In :any contest, Trustor shall defend. itself and Lender and shall
satisfy- any adverse judgment before enforcement against the Property. Trustor shall name. Lender as an additional obligee uhder any
surety bond furnished in the contest proceedings.
Evidence of Payment. Trustor shall upon demand furnish to Lehder satisfactory evidence of payment of the taxes or assessments and
shall authorize the appropriate governmental official to .deliver to Lender at any time a written statement of the taxes and assessments
against the Property.
Notice of Construction. Trustor shall notify Lender at least fifteen (15) days before any work is commenced, any services are
furnished,. or any materials are supplied to the Property, if-any mechanic's lien, materialmen's lien, or other lien could be asserted on
account of the-work, services, or materials and the cost exceeds 1000. Trustor. will upon request of Lender furnish to Lender
advance assurances satisfactory to Lender. that Trustor can •and will pay the cost of such improvements.
PROPERTY DAMAGE INSURANCE. The following provisions' relating to insuring the Property are a part of this Deed of Trust.
Maintenance of Insurance. Trustor shall procure and maintain policies of fire insurance with standard extended coverage
endorsements on a replacement basis. for the full insurable value covering all Improvements on the Real Property in an amount
sufficient to avoid application of any coinsurance clause,. and with a standard mortgagee clause in favor of Lender. Trustor shall also
.procure and maintain comprehensive general liability insurance in such coverage amounts as Lender may request with Trustee and
Lender being named as additional insureds in such liability insurance policies: Additionally, Trustor shall maintain such other
insurance, including .but not limited to hazard, business interruption, and boiler insurance, as Lender may reasonably require.
Notwithstanding the foregoing, in no event shall Trustor be required to provide hazard insurance in excess of the replacement value of
the improvements on the Real Property. Policies shall be written in form, amounts, coverages and basis. reasonably acceptable. to
Lender and issued by a company or companies reasonably acceptable to Lender. Trustor, upon request of Lender, will. deliver to
Lender from time to time the policies or certificates of insurance in form satisfactory to Lender, including stipulations that coverages
will not be cancelled or diminished without at least thirty (30) days prior written notice to Lender. Each insurance policy also shall
include an endorsement providing that coverage in favor of Lender will not be impaired in anyway by any act, omission or default of
Trustor or any other person. Should the Real Property be located in an area designated by the Director of the Federal Emergency
Management Agency as a special flood hazard area, Trustor agrees to obtain and maintain Federal Flood Insurance, if available, within
45 days. after notice is given by Lender that the Property is located in a special flood hazard area, for the full unpaid principal balance
of the loan and any prior liens on the property securing the loan, up to the maximum policy limits set under the National Flood
Insurance Program, or as otherwise required by Lender, and to maintain such insurance for the term of the loan.
.Application of Proceeds. Trustor shall promptly notify Lender of any loss or damage to the Property if the estimated cost of repair or
replacement exceeds 1000.. Lender may make proof of loss if Trustor fails to do so within fifteen (15) days of the casualty. If in
Lender's sole judgment Lender's security interest in the Property has been impaired, Lender may, at Lender's election, receive and
retain the proceeds of any insurance and apply the proceeds to the reduction of the Indebtedness, payment of any lien affecting the
Property, or the restoration and repair of the Property. If the proceeds are to be applied to restoration and repair, Trustor shall repair
or replace the damaged or destroyed Improvements in a manner satisfactory to Lender. Lender shall, upon satisfactory proof of such
expenditure, pay or reimburse Trustor from the proceeds. for the reasonable cost of repair or restoration if Trustor is -not in default
under this Deed of Trust: Any proceeds which have not been disbursed within 180 days after their receipt and which Lender has not
committed to the repair or restoration of the Property shall be used first to pay any amount owing to Lender under this Deed of Trust,
then to pay accrued interest, and the remainder, if any, shall be applied to the principal balance of the Indebtedness. If Lender holds
any proceeds after payment in full of the Indebtedness, such proceeds shall be paid to Trustor as Trustor's interests may appear.
Trustor's Report on Insurance. Upon request of Lender, however not more than once a year, Trustor shall furnish to Lender a report
DEED OF TRUST
Loan No: 29332 (COIlt117Ued) Page 4
on each existing policy of insurance-showing: (1) the name of the insurer; (2) the risks insured; (3) the amount of the policy; (4)
the property insured, the then current replacement value of such property, and the manner of determining that value; and (5) the
expiration date of the policy. Trustor shall, upon request of Lender, have an independent appraiser satisfactory to Lender determine
- the cash value replacement cost of the Property.
TAX AND INSURANCE RESERVES. Subject to any limitations set by applicable law, Lender may require Trustor to maintain with Lender
reserves for payment of annual taxes, assessments, and insurance premiums, which reserves shall be created by advance payment or
monthly payments of a sum` estimated by Lender to be sufficient to produce, amounts at least equal to the taxes, assessments, and
insurance premiums'to be paid. The reserve funds shall be held by Lender as a general deposit from Trustor, which Lender may satisfy by.
payment of the taxes, assessments, and insurance premiums required to be paid by Trustor as they become due. Lerider shall have the
right to draw upon the reserve`funds to pay such items, and Lender shall not be required to determine the validity or accuracy of any item
before paying it. Nothing in the Deed of Trust-shall be construed as requiring Lender to advance other monies for such purposes, and
Lender shall not incur any liability-for anything 'it may do or omit to do with respect to the reserve account. Subject to any limitations set
by applicable law, if the reserve funds disclose a shortage or deficiency,. Trustor shall pay such shortage or deficiency as required by
Lender. All amounts in the reserve account are hereby pledged to further secure the Indebtedness,-and Lender. is hereby. authorized to
withdraw and apply such amounts on the Indebtedness upon the occurrence of an Event of Default. Lender shall not be required to pay
any interest or earnings on the reserve funds unless required by law or agreed to by Lender in writing. Lender does not hold the reserve
funds in trust for Trustor, and Lender is not Trustor's agent for payment of the taxes and assessments required to be paid by Trustor.
LENDER'S EXPENDITURES. If any action or proceeding is commenced that would materially affect Lender's interest in the Property or if
Trustor fails to comply with any provision of this Deed of Trust or any Related Documents, including but not limited.to Trusto~'s failure to
discharge or pay when due any amounts Trustor is required to discharge or pay under this Deed of Trustror any Related Documents, Lender
on Trustor's behalf may (but shall not be obligated to) take any action that Lender deems appropriate, including but not limited to
discharging or paying all taxes, liens, security interests, encumbrances and other claims, at any time levied or..placed on the Properly and
paying all costs for insuring, maintaining and preserving the Property. All such expenditures incurred or paid by Lender for such purposes
will then bear interest at the rate charged under the Note from the date incurred or paid by Lender to the date of repayment by Trustor. All
such expenses will become a part of the .Indebtedness and, at Lender's option, will (A) be payable bn demand; (B) be added to the
balance of the Note and be apportioned among. and be payable with any installment payments to become due during either (1) the term of
any applicable insurance policy; or (2) the remaining term of the Note; or (C) be treated as a balloon payment which will be due and
payable. at the Note's maturity. The Deed of Trust also will secure payment of these. amounts.. Such. right shall be in addition to all other
rights and remedies to which Lender may be entitled upon Default.
WARRANTY; DEFENSE OF TITLE. The following provisions relating to ownership of the Property are. a part of this Deed of Trust:
Title.. Trustor warrants that: (a) Trustor holds good and marketable title of record to the Property in fee simple, free and clear of all
liens and encumbrances other than those set forth in the Real Property description or in any title insurance policy, title report, or final
title opinion issued in favor of, and accepted by, Lender in connection with this Deed of Trust, and. (b) Trustor has the full. right,
power, and authority to execute and deliver this Deed of Trust to Lender.
Defense of Title. Subject to-.the exception in the paragraph above, Trustor warrants and will forever defend the title to the. Property
against the lawful claims of all persons. In the event any action or-proceeding. is commenced that questions Trusto~'s title or the
interest of Trustee or Lender under this Deed of Trust, Trustor shall defend the action at Trustor's expense. Trustor may be the
nominal party in such proceeding, but Lender shall be entitled to participate in the proceeding and to be represented in the proceeding
by counsel of Lerder's own .choice, and Trustor. will deliver,. or cause to be delivered, to Lender such instruments as Lender may
request from time to time to permit such participation.
Compliance With Laws. Trustor warrants that the Property and Trustor's use of the Property complies with all existing applicable
laws, ordinances, and regulations of governmental authorities.
Survival of Representations and Warranties. All representations, warranties, and agreements made by Trustor in this Deed of Trust
shall survive the execution and delivery of this Deed of Trust, shall be continuing in nature, and shall remain in full force and effect
until such time as Borrower's Indebtedness shall be paid in full.
CONDEMNATION. The following provisions relating to eminent domain and inverse condemnation proceedings are a part of this Deed of
Trust:
Proceedings. If any eminent domain or inverse condemnation proceeding is commenced affecting the Property, Trustor shall promptly
notify Lender in writing, and Trustor shall promptly take such steps as may be necessary to pursue or defend the action and obtain the
award. Trustor may be the nominal party in any such proceeding, but Lender shall be entitled, at its election, to participate in the
proceeding and to be represented in the proceeding by counsel of its own choice, and Trustor will deliver or cause to be delivered to
.Lender such •instruments and documentation as may be requested by Lender from time to time to permit such participation.
.Application of Net Proceeds. If any award is made or settlement entered into in any condemnation proceedings affecting all or any
part of the Property or.by any proceeding or purchase in lieu of condemnation, Lender may at its election, and to the extent permitted
by law, require that all or-any portion of4he award or settlement be applied to the Indebtedness and to the repayment of all reasonable
costs, expenses, and attorneys'.fees incurred by Trustee or Lender in connection with the condemnation proceedings.
IMPOSITION OF TAXES, FEES AND CHARGES BY GOVERNMENTAL AUTHORITIES. The following provisions relating to governmental
taxes, fees and charges are a part of this Deed of Trust:
Current Taxes, Fees and Charges. Upon request by Lender, Trustor shall execute such documents in addition to this Deed of Trust
and take whatever other action is requested by Lender to perfect and continue Lender's lien on the Real Property. Trustor shall
Yeimburse Lender for all taxes, as described .below, together with all expenses incurred in recording, perfecting or.continuing this Deed
of Trust, including .without limitation all taxes, fees, documentary stamps, and other charges for recording or registering this Deed of
Trust.
Taxes. The following shall constitute taxes to which this section. applies: (1) a specific tax upon this type of Deed of Trust or upon
DEED OF-TRUST
Loan No: 29332. (COntlnUt:d) Page 5
all or any part of the Indebtedness secured by,this Deed of Trust; (2) a specific tax on Borrower which Borrower is authorized or
.required to deduct from payments on the Indebtedness secured by this type of Deed of Trust; (3) a tax on this type of Deed of Trust
chargeable against the Lender or the holder of the Note; and (4). a specific tax on ail or any portion of the Indebtedness or on
payments of principal and interest made by Borrower.
Subsequent Taxes. if any tax to which this section applies is enacted. subsequent to the date of this Deed of Trust,- this. event shall
have the same -effect as an Event of Default, and Lender may exercise any or all of its available remedies for an Event of Default as
provided below unless Trustor either (1) pays the tax before it becomes delinquent, or (2) .contests the tax as provided above in the
Taxes and Liens section and deposits with Lender cash or a sufficient corporatesurety bond or other security satisfactory to Lender.
SECURITY AGREEMENT; FINANCING STATEMENTS. The following provisions relating to this Deed of Trust as a security agreement are a
part of this Deed of Trust:
Security Agreement. -This instrument shall constitute a Security Agreement to the extent any of the Property constitutes fixtures, and
Lender shall have all of the rights of a secured party under the Uniform Commercial Code as amended from time to time.
Security Interest. Upon request by Lender, Trustor shall take whatever action is requested by Lender to perfect and continue Lender's
security interest in the Rents and Personal Property.. Trustor shall reimburse Lender for all expenses incurred in perfecting or
continuing this security interest. Upon default, Trustor shall not remove, sever or detach the Personal Property from the Property.
Upon default, Trustor shall assemble any Personal Property not affixed to the Property in a manner and at aplace-reasonably
convenient to Trustor and Lender and make it available to Lender within three (3) days after receipt of written demand from Lenderto
the extent permitted by applicable law.
Addresses. The .mailing addresses of Trustor (debtor) and. Lender (secured party) from which information concerning the security
interest granted by this Deed of Trust may be obtained (each as required by the Uniform Commercial Code) are as stated on the first
page of this Deed of Trust.
FURTHER ASSURANCES; ATTORNEY-IN-FACT. The following provisions relating to further assurances and attorney-in-fact are apart of
this Deed of Trust:
Further Assurances. At any time, and from time to time, upon request of Lender, Trustor will make, execute and deliver, or will cause
to be made, executed or delivered, to Lender or to Lender's designee, and when requested by Lender, cause to tie filed, recorded,
refiled, or rerecorded, as the case may be, at such times and in such offices and places as Lender may deem appropriate, any and all
such mortgages; deeds of trust, security deeds; security agreements, financing statements, continuation statements; instruments of
further assurance; certificates; and other documents as may, in the sole opinion of Lender, be necessary or desirable in order to
effectuate, complete, perfect, continue; or preserve (1) Borrower's and Trustor's obligations under the Note, this Deed of Trust, and
-the Related Documents, and (2) the liens and security interests created by this Deed of Trust as first and -prior liens on the Property,
whether; now owned or hereafter acquired by Trustor. Unless prohibited by law or Lender agrees to the contrary in writing, Trustor
shall reimburse Lender for all costs and expenses incurred in connection with the matters7eferred to in this paragraph.
Attorney-in-Fact. If Trustor fails to do any. of the things referred to in the preceding paragraph, Lender may do so for and in the name
of Trustor and at Trustor's expense. For such purposes, Trustor hereby irrevocably appoints Lender as Trustor's attorney-in-fact for
the purpose of making;, executing, delivering, filing, recording, and doing all other things as may be necessary or desirable,. in Lender's
sole opinion, to accomplish the matters referred to in the preceding paragraph.
FULL PERFORMANCE. If Borrower and Trustor pay all the Indebtedness when due,- and Trustor otherwise pertorms all the obligations
imposed upon' Trustor under this Deed of Trust, Lender shall execute and deliver to Trustee a request for full reconveyance and shall
execute and deliver to Trustor suitable statements of termination of any financing statement oh file evidencing Lender's security interest in
the Rents and the Personal Property. Lender maycharge Trustor a reasonable reconveyance fee at the time of reconveyance.
EVENTS OF DEFAULT. Each of the following, at Lender's option, shall constitute an Event of Default under this Deed of Trust:
Payment Default. Borrower fails to make any payment when due-under the Indebtedness.
Other Defaults. Borrower or Trustor fails to comply with or to perform any other term, obligation, covenantor condition contained in
this Deed of Trust or in any of the Related Documents or to comply with or to perform any term, obligation, covenant or condition
contained in any other agreement between Lender and Borrower or Trustor.
Compliance Default. Failure to comply with any other term, obligation, covenant or condition contained in this Deed of Trust, the Note
or in any of the Related Documents..
Default on Other Payments. Failure of Trustor within the time required by this Deed of Trust to make any payment for taxes or
insurance, or any other payment necessary to prevent filing of or to effect discharge of any lien.
Default in Favor of Third Parties.- Should Borrower or any Grantor default under any loan, extension of credit, security agreement,
purchase or sales agreement, or any other .agreement, in favo"r of any other creditor or person that may materially affect any of
Borrower's or any Grantor's property or Borrower's ability to repay the Indebtedness or Borrower's or Grantor's ability to perform their
respective obligations under this Deed of Trust or any of the Related Documents.
False Statements. Any warranty, representation or.statement made or furnished to. Lender by Borrower or Trustor or on Borrower's or
Trustor's behalf under this. Deed- of7rust or the Related Documents is false or misleading in any material respect, either now or at the
time made or furnished or becomes false or.misleading at anytime thereafter.
Defective Collateralization.` This Deed of Trust or any of the Related Documents ceases to be in full force and effect (including failure
of any collateral document to create a valid and perfected security interest or lien) at any time and for any reason.
Insolvency.- The dissolution or termination of Borrower's or Trustor's existence as a going business, the insolvency of Borrower or
Trustor, the appointment of a receiver for any part of Borrower's or Trustor's property, any assignment for the benefit of creditors,
any type of creditor- workout, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against
Borrower or Trustor.
DEED OF TRUST
Loan No: 29332 (Continued) Page 6
Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether 6yjudiciol-proceeding, self-help,
repossession or any other method, by any creditor of Borrower or Trustor or by any governmental. agency against any property
securing the Indebtedness. This includes a garnishment of any of Borrower's or Trustor's accounts, including deposit accounts, with
Lender. However, this Event of Default shall not apply if there is a good faith dispute by Borrower or Trustor as to the validity or
reasonableness of the claim which is the basis of the creditor or forteiture proceeding and if Borrower or Trustor gives Lender written
notice of -the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture
proceeding in an amount determined by Lender, in its sole. discretion, as being an adequate reserve or bond -for the dispute.
Breach. of Other Agreemept. Any breach by Borrower or Trustor under the terms of any other agreement between Borrower or
Trustor and Lender that is not remedied within any grace period provided therein, including without limitation any agreement
coricernirig any iridebtedness or other obligation of Borrower or Trustor to Lender, whether existing now or later.
Events Affecting Guarantor. Any of the preceding events occurs with respect to any guarantor, endorser, surety, or accommodation
party of any of the'Indebtedness or any guarantor, endorser, surety, or accommodation party dies or becomes incompetent, or
revokes or disputes the validity of, or liability under, any Guaranty of the Indebtedness.
Adverse Change. A material adverse change occurs in Borrower's or Trustor's financial condition, or Lender believes the prospect of
payment or performance of the Indebtedness is impaired.
Right to Cure. If any default, other than a default in payment is curable and if Trustor has not been given a notice of a breach of the
same provision of this Deed of Trust within the preceding twelve (12) months, it may be cured if Trustor, after receiving written notice
from Lender demanding cure of such default: (1) cures the default within fifteen (15) days; or (2) if the cure requires more than
fifteen (15) days, immediately initiates steps which Lender deems in Lender's sole discretion to be sufficient to cure the default and
thereafter continues and completes all reasonable and necessary steps sufficient to produce compliance: as soon as reasonably
practical.
RIGHTS AND REMEDIES ON DEFAULT. If an Event of Default occurs under this Deed of Trust, at any time. thereafter, Trustee or Lender
may exercise any one or more of the following rights and remedies:
Election of Remedies. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make
expenditures onto take action to perform an obligation of Trustor under this, Deed of Trust; after Trustor's failure to perform; shall not
affect Lender's right to declare a default and exercise its remedies.
Foreclosure by $ale. Upon an Event of. Default under this Deed of Trust, Beneficiary may declare the entire Indebtedness secured by
this Deed of Trust immediately due and payable by delivery to Trustee of written declaration of default and demand for sale and of
written notice of default and of election to cause to be sold the Property, which notice Trustee shall cause to be filed for record.
Beneficiary also shall deposit with Trustee this Deed of Trust, the Note, other documents requested by Trustee, and all documents
evidencing expenditures secured hereby. After the lapse of such time as may then be required by law following the recordation of the
notice of default, end notice of sale having been given as then. required by law, Trustee, without demand on Trustoq shall sell the
Property at the time and place fixed by it in the notice of sale, either as a whole or in separate parcels, and in such order as it may
determine, at public auction to the highest bidder for cash 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 in accordance with
applicable law. Trustee shall deliver to such purchaser its deed. conveying the Property so sold, but without any covenant or
warranty, express or implied. The recitals in such deed of any matters oi• facts shall be conclusive proof of the truthfulness thereof.
Any person, including Trustor, Trustee or Beneficiary may purchase at such sale.. After deducting all costs, fees and expenses of
Trustee- and of this Trust, including cost of evidence of title in connection with sale, Trustee shall apply the proceeds of sale to
payment of: all sums expended under the terms hereof, not then repaid, with accrued interest at the amount allowed by law in effect
at the date hereof; all other sums then secured hereby; and .the remainder, if any, to the person or persons legally entitled thereto.
Judicial Foreclosure. With respect to all or any part of the Real Property, Lender shall have the right in lieu of foreclosure by power of
sale to foreclose by judicial foreclosure in accordance with and to the full extent provided by California law.
UCC Remedies. With respect to all or any part of the Personal Property, Lender shall- have all the rights and remedies of a secured
party underthe Uniform Commercial Code, including-without limitation the right to recover any deficiency in the manner and to the full
.extent provided by California law.
Collect Rents.. tender shalt have the right, without notice to Borrower or Trustor to take possession of and manage the Property and
collect the Rents, including amounts past due and unpaid, and apply the net proceeds, over and above Lender's .costs, against the
Indebtedness. In furtherance of this right, Lender may require any tenant or other user of the Property to make payments of rent or
use fees directly to Lender. If the Rents are collected by .Lender, then Trustor irrevocably designates Lender as Trustor's
attorney-in-fact to endorse instruments. received in payment thereof in the name of Trustor and to negotiate the same and collect the
proceeds. Payments by teriants or other users to Lender in response to Lender's demand shall satisfy the obligations for which the
payments are made, whether or not any proper grounds for the demand existed: Lender may exercise its .rights under -this
subparagraph either in person, by agent, or through a receiver.
Appoint Receiver. Lender shall have the right to have a receiver appointed to take possession of all or any part of the Property, with
the power to protect and preserve the Property, to operate the Property. preceding foreclosure or sale, and to collect the Rents from
the Property and apply the proceeds, over and above the cost of the receivership, against the Indebtedness. -The receiver may serve
without bond if permitted by law.. Lender's right to the appointment of a receiver shall exist whether or not the apparent value of the
Property exceeds the Indebtedness by a substantial amount. Employment by Lender shall not disqualify a person from serving as a
receiver.
Tenancy at Sufferance. If Trustor remains in possession of the Property after the Property. is sold as provided above or Lender
otherwise becomes entitled to possession of the Property upon default of Borrower or Trustor, Trustor shall become a tenant at
sufferance of:Lender or the purchaser of the Property and shall, at Lender's option, either (1) pay a reasonable rental for the use of
the Property, or (2) vacate the Property immediately upon the demand of Lender.
DEED OF TRUST
Loan No: 29332 (COntinUed) Page 7
Other Remedies. Trustee or Lender shall have any other right or remedy provided in this Deed of Trust or the Note or available at law
or in equity. -
Notice of Sale. Lender shall give Trustor reasonable notice of the time and place of any public sale of the Personal Property or of the
time after which any private sale. or other intended disposition of the Personal Property is to be'made. Reasonable notice shall mean
notice given at least ten (10) -days before the- time of the sale or disposition. Any sale of the Personal Property may be -.made in
conjunction with any sale of the Real Property..
Sale of the Property. To the extent permitted by applicable law, Borrower. and Trustor hereby waives any and all rights to have the
Property marshalled. In exercising its rights and remedies, the Trustee or .Lender shall be free to sell all or any part of the Property
togetheror separately, in one sale or by separate sales. Lender shall be entitled to- bid at any public. sale on all or any portion of the
Property.
Attorneys'- Fees; Expenses. If Lender institutes any suit or action to enforce any of the terms of this Deed of Trust, Lender shall be
entitled to recover such sum as the court may adjudge. reasonable as attorneys' fees at trial and upon any appeal. Whether or not any
.court action is involved, and to the extent not prohibited by law, all reasonable expenses Lender incurs .that ih Lender's opinion are
necessary at any time for the protection of its interest or the enforcement of its rights shall become a part of the. Indebtedness payable
on demand and shall bear interest. at the Note rate from the date of the expenditure until repaid. Expenses covered by this paragraph
include, without limitatiori, however subject to any limits under applicable law, Lerder's attorneys' fees and Lender's legal. expenses,
whether or not there is a lawsuit, including attorneys' fees and expenses for bankruptcy proceedings (ihcluding efforts to modify or.
vacate any automatic stay or injunction), appeals, and any anticipated post-judgment- collection services, the cost of searching
records, obtaining title reports (including foreclosure reports), surveyors' reports, and appraisal fees, title insurance, and fees for the
Trustee, to the extent permitted by applicable law. Trustor also will pay any court costs, in addition to all other sums'provided by
law.
Rights of Trustee. Trustee shall have all of the rights and duties of Lender as set forth in this section.
POWERS AND OBLIGATIONS OF TRUSTEE. The following.provisions relating to the powers and obligations of Trustee are part of this
Deed of Trust:
Powers of Trustee. In addition to all powers of Trustee arising as a matter of law, -Trustee shall have the power to take the following
actions with respect to the Property upon the written request of Lender and, Trustor: (a) join in preparing and filing a map or plat of
the Real Property, including the dedication of streets or other rights to the public; (b) join in grariting any easement or creating any
restriction on the Real Property; and (c) join in any subordination or other agreement affecting this-Deed of Trust or the interest of
Lender under this Deed of Trust.
Obligations to Notify. Trustee shall not be obligated to notify any other party of a pending sale under any other trust deed or lien, or
of any action or proceeding in which Trustor, Lender, or Trustee shall be a party, unless the action orproceeding is brought by
Trustee.
Trustee. Trustee shall meet all qualifications required for Trustee under applicable law. In addition to the rights and remedies, set
forth above, with respect to alf or any part of the Property, the Trustee shall have the right to foreclose by notice and sale, and Lender
shall have the right to foreclose by judicial foreclosure, in-either case ih accordance with and to the full extent provided by applicable
law.
Successor Trustee. Lender, at Lender's option, may from time to time appoirit a successor Trustee to any Trustee appointed under
this Deed of Trust by an instrument executed and acknowledged by Lender and recorded in-the office of the recorder of Los Angeles
County, State of California The instrument shall contain, in addition to all other matters required by state law, the names ,of the
original Lender, Trustee, and Trustor, the book and page where this Deed of Trust is recorded, and the name and. address. of the
successor trustee, and the instrument shall be executed and acknowledged by Lender or its successors in interest. The successor
trustee, without conveyance of the Property, shall succeed to all the title, power, and duties conferred upon the Trustee in this Deed
of Trust and by applicable lew. This procedure for substitution of Trustee shall govern to the exclusion of all other provisions for
substitution.
Acceptance by Trustee. .Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged,. is made a public
record as provided bylaw.
NOTICES. Any notice required to be given under this Deed of Trust shall be given in writing, and shall be effective when actually delivered,
when .actually received by telefacsimile (unless otherwise required by law); when deposited with a nationally recognized overnight courier,
or, if mailed, when deposited in the United States mail,. as first class, certified or registered mail postage prepaid, directed to the addresses
shown near the beginning of this Deed of Trust. Trustor requests that copies of any notices of default and sale be directed to Trustor's
address shown near the beginning of this Deed of Trust. All copies of notices of foreclosure from the holder of any lien which has priority
over this Deed of Trust shall be sent to Lender's address, as shown near the beginning of this Deed of Trust. Any party may change its
address for notices under this Deed of Trust by giving formal written notice to the other parties,. specifying that the purpose of the notice is
to change the party's address. For notice purposes, Trustor. agrees to keep Lender informed at Fall times of Trustor's current address.
Unless otherwise provided or required by law, if there is more-than one Trustor, any notice given by Lender to any Trustor is deemed to be
notice given to all Trustors,
STATEMENT OF OBLIGATION FEE. Lender may collect a fee, not to exceed the maximum amount permitted by law, for furnishing the
statement of obligation as provided by Section 2943 of the Civil Code of California,.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Deed of Trust:
Amendments: This Deed of Trust, together with any .Related Documents, constitutes the entire understanding and agreement of the
parties as to the matters set forth in this Deed of Trust. No alteration of or amendment to this Deed of Trust shall be effective unless
given in writing and signed by the party or parties sought to be charged br-bound by the alteration or amendment.
Annual Reports.. If the Property is. used for purpgses other than.Trustor's residence, Trustor shall furnish to Lender,. upon request, a
DEED OF TRUST
Loan No: 29332 (COntlnUed) Page 8
certified statement of net operating income received from the Property during Trustor's previous fiscal year in such form and detail as
Lender shall require.. "Net operating income" shall-mean all cash receipts from the Property less all cash expenditures made in
connection with the operation of the Property.
Caption Headings. Caption headings in this Deed of Trust are for convenience purposes only and are not to be used to interpret or
define the provisions of this Deed. of Trust.
Merger. There shall be no merger of the. interest or estate created by this Deed of Trust with any other interest or estate in the
Property:at any time held by or for the benefit of Lender in any capacity; without the written consent of Lender.
Governing Law. This Deed of Trust will be governed by federal law applicable to Lender and, to the extent not preempted by federal
law, the laws of the State of California without regard to its conflicts of law provisions. This Deed of Trust has been accepted by
Lender in the State of California.
Joint and` Several Liability.. 'All. obligations- of Borrower and Trustor' under this Deed of Trust shall be ]oint and several, and all .
references to Trustor shalt mean each and every Trustor, and all references to Borrower shall mean each and every Borrower. This
means that each Trustor signing -below is responsible for all obligations in this Deed of Trust. Where any one or more of the. parties is
a corporation, partnership, limited liability company or similar entity, it is not necessary for Lender to inquire into the powers oYany of
the officers, directors, parthers, members, or other agents acting or pu~porting to act on the entity's behalf, and any obligations made
or created in reliance upon the professed exercise of such powers shall be guaranteed under this Deed of Trust.
No Waiver by,Lender. Lender shall not lie deemed to have waived any rights under this Deed of Trust unless such waiver is given in
writing. and signed by Lender. No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such
right or any other right. A waiver by. Lender of a provision of this •Deed of Trust shall not prejudice or constitute a waiver of Lender's
right otherwise to demand strict compliance with that provision or any other provision of this Deed of Trust. No prior waiver' by
Lender, nor any course of dealing between. Lender and Trustor, shall constitute a waiver of .any of Lender's rights or of any of
Trustor's obligations as to any future transactions. Whenever the consent of Lender is required under this Deed of Trust, the granting
of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is
required and in all cases such consent may be granted or withheld in the sole discretion of Lender.
Severability. If a court of competent jurisdiction finds any provision of this Deed of Trust to be illegal, invalid, or unenforceable as to
any circumstance, that finding shall not make the offending provision illegal, invalid, or unenforceable as to any other circumstance. If
feasible, the: offending provision shall be considered modified so that it becomes legal, valid and enforceable. If the offending
provision cannot be so modified, it shall be considered deleted from this .Deed of Trust: Unless otheiwise required by law, the-
illegality, invalidity, or unenforceability of any provision of this Deed of Trust shall not affect the legality, validity or enforceability of
any other provision of this Deed of Trust.
Successors and Assigns. Subject to any Jimitations stated in this heed of Trust on transfer of Trustor's interest, this Deed of Trust
shall be binding upon and inure to the benefit of the parties, their successors and assigns. If ownership of the Property becomes
vested in a person other than Trustor, Lender, without notice to Trustor, may deal with Trustor's successors with reference to this
Deed of Trust and the Indebtedness by way of forbearance or extension without releasing Trustor from the obligations of this Deed of
Trust or liability under the Indebtedness.
Time is of the Essence. -Time is of the essence in the performance of this Deed of Trust.-
Waive Jury. To the extent permitted by applicable law,. all parties to this Deed of Trust hereby waive the right to any jury trial in any
action, proceeding, or counterclaim brought by any party against any other party.
DEFINITIONS. The following capitalized words ahd terms shall have the. following meanings when used in this Deed of Trust. Unless
specifically stated to the contrary, all references to dollar amounts shall mean amounts ih lawful money of the United States of America.
Words and terms used in the singular shall include the plural, and the plural shall include the singular, as the context may require. Words
and terms not otherwise defined in this Deed of Trust shat( have the meanings attributed to such terms in the Uniform Commercial Code:
Beneficiary. The'word "Beneficiary" means East West Bank, and its successors and assigns.
Borrower. The word "Borrower" means. City of Vernon, a Municipal Corporation and includes all co-signers and co-makers signing the
Note and all their successors and assigns.
Deed of Trust. The words "Deed of Trust" mean this Deed of Trust among Trustor, Lender, and Trustee, and includes without
limitation all assignment and. security interest provisions relating to the Personal Property and Rents.
Default. The word "Default" means the Default set forth in this Deed of Trust in the section titled "Default".
Environmental Laws: The words "Environmental Laws" mean any and all state, federal and local statutes, regulations and ordinances
relating fo the protection of human health or the environment, including without limitation the Comprehensive- Environmental
Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq. ("CERCLA"), the Superfund
Amendments and. Reauthorization Act of 1986,-Pub. L. No. 99-499 ("SARA"), the Hazardous Materials Transportation Act, 49 U.S.C.
Section 1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., Chapters 6.5 through 7.7 of
Division 20 of the California Health and Safety Code, Section 25100, et seq., or other applicable state or federal laws, rules, or
regulations adopted pursuant thereto.
Event of Default. The words "Event of Default" mean any of the events of default sef forth in this Deed of Trust in the events of
default section of this heed of Trust.
Guaranty. The word "Guaranty" means the guaranty from guarantor, endorser, surety, or accommodation party to Lender, including
without limitation a guaranty of all or part of the Note.
Hazardous Substances. .The words- "Hazardous Substances" mean materials that, because of their quantity, concentration or
physical, chemical or infectious characteristics, may cause or pose a present or potential hazard to human health or the environment
when improperly used, treated, stored, disposed of, generated, manufactured, transported or otherwise handled. The words
DEED OF TRUST
Loan No 29332 (COntlnued) Page 9
"Hazardous Substances" are used in .their very broadest sense and include without limitation any and .all hazardous or toxic
substances, materials- or waste as defined- by or fisted under the Environmental Laws. .The term "Hazardous Substances" also
includes, without limitation, petroleum and petroleum by-products or any fraction thereof and asbestos.
Improvements. The word "Improvements" means all existing and future improvements, buildings, structures; mobile homes affixed on
the Real Property, facilities, additions, replacements and other construction on the Real Property.
Indebtedness. The word "Indebtedness" means all principal, interest, and other amounts, costs and expenses payable under the Note
or Related Documents, together with all renewals of, extensions of, modifications of, consolidations of and substitutions for the Note
or Related Documents and any amounts expended or advanced by Lender to discharge Trustor's obligations or expenses incurred by
Trustee or Lender to enforce Trustor's obligations under this Deed of Trust, together with interest on such amounts as provided in this
Deed of Trust.
Lender. The word "Lender" means East West Bank, its successors and assigns.
Note. The word ''Note" means the promissory note dated May 7, 2009, In the original principal amount of
$6,370,000.00 from Borrower to Lender, together with all renewals of, extensions of, modifications of, refinancings of,
consolidations of, and substitutions for the promissory note or agreement. NOTICE TO TRUSTOR: THE- NOTE CONTAINS A
VARIABLE INTEREST RATE.
Personal Property. -The words "Personal Property" mean all equipment, fixtures, .and other articles of personal .property now- or
hereafter owned by Trustor, and now or hereafter attached or affixed to the Real Property; together with all accessions, parts, and
additions to, all replacements of, and all substitutions for, any of such property; and. together with all proceeds (including without
limitation all insurance proceeds and refunds of premiums) from any sale or other disposition of the Property.
Property. The word."Property" means collectively the Real Property and the Personal Property.
Real Property. The words "Real Property" mean the real property, interests and. rights, as further described in this Deed of Trust.
Related Documents. The words "Related Documents" mean all promissory notes, credit agreements, loan agreements, security
agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all .other instruments, agreements and. documents,
whether now or hereafter existing, executed in connection with the Indebtedness; except that the words do not mean any guaranty or
environmental agreement, whether now or hereafter existing, executed in connection with the indebtedness.
Rents. The word "Rents" means all present and future leases, rents, revenues, income, issues, royalties, profits, and other benefits
derived from the Property together with the cash proceeds of the Rents.
Trustee. The word "Trustee" means EAST WEST INVESTMENT INC., A CALIFORNIA CORPORATION ,whose address is 9300 Flair
Drive, 6th Floor, EI Monte, CA 91731 and any substitute or successor trustees.
Trustor. The word "Trustor" means City of Vernon, A Body Corporate And Politics.
TRUSTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS DEED OF TRUST, AND TRUSTOR AGREES TO ITS TERMS,
INCLUDING THE VARIABLE RATE PROVISIONS OF THE NOTE SECURED BYJHIS DEED OF TRUST.
TRUSTOR:
CITY OF VERNON, A BODY CORPORATE AND POLITICS
By:
Leonis C. Malburg, Mayor of City of Vernon, A Body Corporate And Politics
DEED OF TRUST
Loan No: 29332 (COntlnued) Page 10
CERTIFICATE OF ACKNOWLEDGMENT
.STATE OF )
SS
COUNTY OF )
On , 20 before me, ,
(here insert name and title of the officer)
personally appeared Leonis C. Malburg, 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.
Signature (Seal)
(DO NOT RECORD)
REQUEST FOR FULL RECONVEYANCE
(To be used only when obligations have. been paid in full)
To: ,Trustee
The undersigned is the legal owner and holder of all Indebtedness secured by this Deed of Trust. All sums secured by this Deed of Trust
have been fully paid and satisfied. You are hereby directed, upon payment to you of any sums owing to you under the terms of this Deed
of Trust or pursuant to any applicable statute, to cancel the Note secured by this Deed of Trust (which is delivered to you together with
this Deed of Trust), and to reconvey, without warranty, to the parties designated by the terms of this Deed of Trust, the estate now held
by you under this Deed of Trust. Please mail the reconveyance and Related Documents to:
Date: Beneficiary:
By:
Its:
LASER PRO Lending, Ver. 5.44.00.002 Copr. Harland Financial Solutions, Inc. 1997, 2009. All Rights Reserved. - CA
G:\APPS\EWBCFI\CFI\LPL\G01.FC TR-9143 PR-1
' AGREEMENT TO PROVIDE INSURANCE
.......t...~...~1 ......................_4~~n...~3~~.............at~r~..........................~a~n...N:~............................ ~a...~.c~~.......................... ~~~au~t~.................
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.................................................../..~...........................................................j...................................................................................
....................................................................................................................................................................................
..~..~~~Y.~V .~.V..~~....~ST~~.... S/~:'V.l
References in the boxes above are for Lender's use only and do notiimit the applicability of"this document to any particular loan oritem.
Any item above containing has been omitted due to text length limitations.
$OrrOWer: City of Vernon, a Municipal Corporation Lender: East West Bank
4305 Santa Fe Avenue Loan Servicing Department
Vernon, CA 90058 9300 Flair Drive
EI Monte, CA 91731
Grantor: City of Vernon, A Body Corporate And Politics
4305 Santa Fe Avenue
Vernon, CA 90058
INSURANCE REQUIREMENTS. Grantor, City of Vernon, A Body Corporate And Politics ("Grantor"), understands that insurance coverage is
required in connection with the extending of a loan or the providing of other financial .accommodations to City of Vernon, a Municipal
Corporation ("Borrower") by Lender. These requirements are set forth in the security documents for the loan. The following minimum insurance
coverages must be provided on the,following described collateral (the "Collateral"):
Collateral: 4855 East 52nd Place, Vernon, CA 90058-5507.
Type:. Fire and extended coverage.
Amount: Full Insurable Value; however in no event greater than the value of the replacement cost of the improvements.
Basis: Replacement value.
Endorsements: Standard mortgagee's clause with stipulation that coverage will not be cancelled or diminished without a
minimum of 30 days prior written notice to Lender, and without disclaimer of the insurer's liability for failure to give such
notice.
Comments: Lender's Loss Payable Endorsement to read: East West Bank, its successors and/or assigns, at P.O. Box 60021,
City of Industry, CA 91716-0021.
Deductibles: $50,000.00.
Latest Delivery Date: By the loan closing date.
INSURANCE COMPANY. Grantor may obtain insurance from -any insurance company Grantor may choose that is reasonably acceptable to
Lender. Grantor understands that credit may not be denied solely because insurance was not purchased through Lender.
FLOOD INSURANCE. Flood Insurance for the Collateral securing this loan is described. as follows:
Real Estate at 4855 East 52nd Place, Vernon, CA 90058-5507.
The Collateral securing this loan is not currently located. in an area identified as having special flood hazards. Therefore, no special flood
hazard insurance is necessary at this time. Should the Collateral at any time be deemed to be located in an area designated by the Director
of the Federal Emergency Management Agency as a special flood :hazard area, Grantor agrees to obtain and maintain .Federal Flood
Insurance, if available, within 45 days after notice is given by Lenderthat the Collateral is located in a special flood hazard area, for the full
unpaid principal balance of the loan and any prior liens on the property securing the loan, up to the maximum policy limits set under the
National Flood Insurance Program,. or as otherwise required by Lender, and to maintain such insurance for the term of the loan. Flood
insurance maybe purchased under the National Flood Insurance Program or from private insurers.
INSURANCE MAILING ADDRESS. All documents and other materials relating to insurance for this loan should be mailed, delivered or directed to
the following address:
East West Bank
Loan Service Department -Insurance
P.O. Box 60021
City of Industry, CA 91716-0021
HAZARDOUS INSURANCE DISCLOSURE. Lender has advised us that it is not permitted under California law to require a borrower, as a
condition of receiving or maintaining a loan secured by real property, to provide hazard insurance coverage against risks to the improvements on
that real property (such as fire and other peril) in an amount exceeding the replacement value of the improvements on the property.
FAILURE TO PROVIDE INSURANCE. Grantor agrees to deliver to Lender, on the latest delivery date stated above, evidence of the required
insurance as provided above, with an effective date of May 7, 2009, or earlier. Grantor acknowledges and agrees that if Grantor fails to provide.
any required insurance or fails to continue such insurance in force, Lender may do so at Grantor's expense as provided in the applicable security
document. The cost of any such insurance, at the option of Lender, shall be added to the indebtedness as provided in the security document.
GRANTOR ACKNOWLEDGES THAT IF LENDER SO PURCHASES ANY SUCH INSURANCE, THE INSURANCE WILL PROVIDE LIMITED
PROTECTION AGAINST. PHYSICAL DAMAGE TO THE COLLATERAL, UP TO AN AMOUNT EQUAL TO THE LESSER OF (1) THE UNPAID
BALANCE OF THE DEBT, EXCLUDING ANY UNEARNED FINANCE CHARGES, OR (2) THE VALUE OF THE COLLATERAL; HOWEVER,
GRANTOR'S EQUITY IN THE COLLATERAL MAY NOT BE INSURED. IN ADDITION, THE INSURANCE MAY NOT PROVIDE ANY PUBLIC
LIABILITY OR PROPERTY DAMAGE INDEMNIFICATION AND MAY NOT MEET THE REQUIREMENTS OF ANY FINANCIAL RESPONSIBILITY
LAWS:
AUTHORIZATION. For purposes of insurance coverage on the Collateral, Grantor authorizes Lender to provide to any .person (including any
insurance agent or company) all information Lender deems appropriate, whether regarding the Collateral, the loan or other financial
accommodations, or both.
AGREEMENT TO PROVIDE INSURANCE
Loan No: 29332 (COntlnued) Page 2
GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS AGREEMENT TO PROVIDE INSURANCE AND AGREES TO ITS
TERMS. THIS AGREEMENT IS DATED MAY 7, 2009.
GRANTOR:
CITY OF VERNON, A BODY CORPORATE AND POLITICS
By:
Leonis C. Malburg, Mayor of City of Vernon, A Body
Corporate And Politics
FOR LENDER USE ONLY
INSURANCE VERIFICATION
DATE: PHONE
AGENT'S NAME:
AGENCY:
ADDRESS:
INSURANCE COMPANY:
POLICY NUMBER:
EFFECTIVE DATES:'
COMMENTS:
' IgSER PRO LBBEinB. Ver. 5.4d.BU.002 Copr: Harland Financial Sdullons, Inc. iBBT, 2008. NI Righle Reservatl. - CA Gi4PPS~EWSCFIICFIILPL1110:FC TR-8143 DR-1 -
DISBURSEMENT REQUEST AND AUTHORIZATION
........i~r:~ .~1 .......................~~~:n...~~~~.............~lat~.rt........ ............................................................................................................
............~.t.................................................................
References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing has been omitted due to text length limitations.
BOfYOWef: City of Vernon, a Municipal Corporation Lender: East West Bank
4305 Santa Fe Avenue Loan Servicing Department
Vernon, CA 90058 9300 Flair Drive
EI Monte, CA 97731
LOAN TYPE. This is a Variable Rate Nondisclosable Loan to a Corporation for $6,370,000.00 due on April 1, 2014.
PRIMARY.PURPOSE OF LOAN. The primary purpose of this loan is for:
? Personal, Family, or Household Purposes or Personal Ihvestment.
® Business (Including Real Estate Investment).
SPECIFIC PURPOSE.- The specific purpose of this loan is: To payoff existing East West Bank sub note #29218-5.
REAL ESTATE DOCUMENTS. If any party to this transaction is granting a security interest in .any real property to Lender and-City of Vernon, a
Municipal Corporation- is not also a party to the Deaf estate document- or documents (the "Real Estate Documents") granting such security
interest, Borrower agrees to perform and comply with the Real Estate Documents just as if Borrower has signed as a direct and original party to
the Real Estate Documents. This means Borrower agrees to all the representations and warranties made in the Real Estate Documents. In
addition, Borrower agrees to perform and comply strictly with alt the terms, obligations and covenants to be performed by either Borrower or
any Grantor or Trustor, or both, as ,those words are defined. in the Real Estate Documents. Lender need not tell Borrower about any action or
inaction Lender takes in connection with the Real Estate Documents. Borrower assumes the responsibility for being and keeping informed about
the property. Borrower also waives any defenses that may arise because of any action or inaction of Lender, including without limitation any
failure of Lender to realize upon-the property, or any delay by Lender in realizing upon the property.
FLOOD INSURANCE. As reflected on Flood Map No. 06037C1810F dated 09-26-2008, for the community of Vernon, some of the property that
will secure the loan is not located in an area that has been identified. by the Director of the Federal Emergency Management Agency as an area
having special flood hazards. Therefore, although flood insurance may be available for the property, no special flood hazard insurance protecting
property not located in an area having special flood hazards is required by law for this loan at this time.
DISBURSEMENT INSTRUCTIONS. Borrower understands that no loan proceeds will be disbursed until all of Lender's conditions for making the
loan have been satisfied. Please disburse the loan proceeds of $6,370,000.00 as follows:
Other Disbursements: $6,370,000.00
$6,370,000.00 To payoff East West Bank subnote
#29218/00005
Note Principal: $6,370,000:00
CHARGES PAID IN CASH.. Borrower has paid or will pay in cash as agreed the following charges:
Prepaid Finance Charges.Paid in Cash: $86,381.06
$63,700.00 Loan Fee
$4.00 Life of Loan Flood Fee
$500,00 Processing Fee
$59.00 Tax Service Fee
$22,118.06 Prepaid Interest (deduct from
Interest Reserve Account)
Other Charges Paid in Cash: $1,634,409.00
$5,000.00 Title Insurance Fee (estimate)
$9.00 Initial Flood Certification Fee
$150.00 Recording Fee
$7,750.00 Appraisal Fee
$1,500.00 Documentation Fee
$190,000.00 Deposit to Interest Reserve Account #80359722
$1,430,000.00 Principal paydown on subnote #29219-5
Total Charges Paid in Cash: $1,720,790.06
AUTOMATIC PAYMENT. Borrower hereby authorizes Lender automatically to deduct from Borrower's account number, in the
amount of any loan payment. Borrower understands the automatic transfer will take place with Borrower's payment schedule, and will occur
each month until the loan is fully paid. Automatic transfer will not take place if Borrower's loan is delinquent. The transfer will be reversed if
there are insufficient funds in the designated account and a service charge of $18.00 will be assessed on the loan. The authorization will
remain in effect until East West Bank receives written notice of cancellation (10 day advance notice required), or upon East West Bank's ten day
advance notice of termination.
EXPIRATION OF LOAN DOCUMENTS. The offer represented by these Loan Documents expires if the Borrower does not sign and return all Loan
Documents to the Lender within. 30
davs of the date of the Loan Documents.
INTEREST RESERVE. Lender and Borrower have agreed to deposit $190,000.00 an Interest Reserve Fund (Account # 80359722) for payment
of interest. Pursuant to the interest payment schedule outlined in the Loan Documents, Lender will advance funds from this Interest Reserve
DISBURSEMENT REQUEST AND AUTHORIZATION
Loan- No: 29332 (Continued) Page 2
Fund to keep interest payments current.. Should the funds aside in the .Interest Reserve Fund be completely disbursed, :Borrower agrees to
maintain the interest payments current or to replenish t e Interest Reserve Fund with sufficient funds as required by Lender. Notwithstanding
the above, Borrower may, with notice to Lender, make interest payments directly to Lender pursuant to the interest payment schedule outlined
in the Loan Documents.
FINANCIAL CONDITION. BY .SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND WARRANTS TO LENDER THAT .THE
INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN BORROWER'S
FINANCIAL CONDITION AS DISCLOSED IN BORROWER'S MOST RECENT FINANCIAL STATEMENT TO LENDER. THIS AUTHORIZATION IS
DATED MAY 7, 2009.
BORROWER:
CITY OF VERNON, A MUNICIPAL CORPORATION
By: By:
Leonis C. Malburg, Mayor of City of Vernon, a Manuela Giron, City Clerk of City of Vernon, a
Municipal Corporation Municipal Corporation
By:
Jeff A. Harrison, City Attorney. of City of Vernon, a
Municipal Corporation
LASER PRO LenEing, Ver. 5.44.00.002 Copr. Rarlentl Flnandal Solullons; inc. 1807, 2008. All Rights Reserved. - CA G:WPPS\EWBCFflCF11LP~\I20.FC TR~B1C3 PR-1 -
pF V$A
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INDUSTRIAL.DEVELOPMENT DEPARTMENT
INTER-DEPARTMENT MEMORANDUM
DATE: July 16, 2009
TO: Nelly Giron, City Clerk
FROM: Jeff A. Harrison, Director of Industrial Development
RE: East West Bank
5119 District Blvd. and 4855 E. 52"d Place
Attached please find for your retention the originally signed loan agreements regarding the above-
. referenced matter.
JH: em
Enclosures
(Resolution Nos. 9904 and 9962)
~
~ ~ ~ -
{ ~r~ L ~ s ~ ~
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_ s
_ ~ ~ F:LI' I
-
INDUSTRIAL DEVELOPMENT DEPARTMENT
4305 Santa Fe Avenue, Vernon, California 90058
Telephone (323) 583-8811
May 27, 2009
Via U.S. Mail
Mr. Larry Wong
Corporate Banking Division
East West Bank
135 N. Los Robles Ave., Suite 600
Pasadena, CA 91101
Re: East West .Bank Loan No. 29218-5 - 4855 E. 52"d Place.
Dear Larry:
Enclosed please find two duplicate originals of the Loan
. Agreement which have been signed by the City of Vernon regarding
the above-referenced loan. Once you have executed, please
return one fu.11y executed Agreement to my attention.
Also enclosed are the following executed documents respecting
the aforementioned loan:
1. Promissory Note.
2. Environmental Indemnity Agreement.
3. Resolution Number 9962.
4. Disclosure of Right to Receive a Copy of an Appraisal.
5. Hazard Insurance Disclosure.
6. Assignment of Deposit Account.
7. Deed of Trust (notarized).
ExcCusiveCy IndustriaC
Mr. Larry Wong Page 2 May 27,.2009
8. Agreement to Provide Insurance.
9. Disbursement. Request and Authorization.
Thank you for your. understanding and cooperation.
Very tru yours,
A arrison
.Direct of Industrial Development,.
JH:em
Enclosures
cc: Manuela Giron,.City Clerk - Resolution 9962
(w/ original Loan Documents, Promissory Note and
Environmental Indemnity Agreement).
City of Vernon, 4305 Santa Fe Avenue, Vernon, California 90058 -Telephone (323) 583-8811
LOAN AGREEMENT
THIS LOAN AGREEMENT (this "Agreement") is entered into as of May 7, 2009 by
CTI'Y OF VERNON, a California municipal corporation ("Borrower"), and EAST WEST
BANK, a California banking corporation ("Lender").
RECITAL
Borrower and Lender entered into the Loan Agreement dated as of September 26, 2007
(the "Revolving Loan Agreement"), pursuant to which Lender made a $50,000,000 revolving
credit facility available to Borrower. Each loan made under the Revolving Loan Agreement is
evidenced by a promissory note and other loan documents. One such loan was made pursuant to
the Revolving Loan Agreement in the amount of $7,800,000 on or about March 20, 2008
("Subloan Three"). Borrower wishes to repay Subloan Three in part by borrowing an additional
loan separate from and not to be governed by the Revolving Loan Agreement, but ratherby this
Agreement and the other "Loan Documents" (as defined below).
ARTICLE I
DEFINITIONS
"Debt" means the aggregate amount of all of the following obligations of Borrower and
its affiliates to Lender: (a) indebtedness or liability for borrowed money whether or not
evidenced by a written instrument; (b) obligations under any guarantee or other agreement to
become secondarily liable for any obligation of another; (c) obligations secured by a lien on
Borrower's or its affiliate's property,. whether or not the obligations have been assumed by
Borrower or such affiliate; and (d) contingent obligations for reimbursement, indemnity and the
like in connection with the issuance of letters of credit and similar instruments for the account of
Borrower or an affiliate.
"Deed of Trust" means the. Deed of Trust dated as of the date of this Agreement executed
by Borrower for the benefit of Lender.
"Environmental Indemnity" means the Environmental Indemnity dated as of the date of
this Agreement executed. by Borrower in favor of Lender.
"Event of Default" has the meaning set forth in Section 6.1 of this Agreement.
"Hazardous Materials" means (a) any chemical, compound, material, mixture or
substance that is now or may later be defined or listed in, or otherwise classified pursuant to, any
Hazardous Materials Law as a "hazardous substance' ; "hazardous material", "hazardous waste",
"extremely hazardous waste", "acutely hazardous waste", "radioactive waste", "infectious
waste", "biohazardous waste", "toxic substance", "pollutant", "toxic pollutant", "contaminant" as
well as any formulation not mentioned herein intended to define, list, or classify substances by
reason of deleterious properties such as ignitability, conosivity, reactivity, carcinogenicity,
toxicity, reproductive toxicity "EP toxicity," or "TCLP toxicity' ; (b) petroleum, natural gas,
natural gas liquids, liquified natural gas, synthetic gas usable for fuel (or mixtures of natural gas
and such synthetic gas) and ash produced by a resource recovery facility utilizing a municipal
1
solid waste stream, and drilling fluids, produced waters and other wastes associated with the
exploration, development or production of crude oil, natural gas, or geothermal resources; (c)
hazardous substance" as defined in Section 25281(f) of the California Health and Safety Code;
(d) "waste" as defined in Section 13050(d) of the California Water Code (e) asbestos in any
form; (f) urea formaldehyde foam insulation; (g) transformers or other equipment which contain
dielectric fluid containing levels of polychlorinated biphenyls (PCBs) in excess of fifty (50) parts
per million; (h) radon; and (i) any other chemical, material, or substance that, because of its
quantity, concentration,. orphysical or chemical characteristics, exposure to which is limited or
regulated for health and safety reasons by any governmental authority, or which poses a
significant present or potential hazard to human health and safety or to the environment if
released into the workplace or the environment.
"Hazardous Materials Laws" means all present and future federal, state and local laws,
ordinances, regulations, permits, guidance documents, policies, decrees, orders and any other
requirements, whether statutory, regulatory or contractual, of governmental authorities relating to
health, safety, the environment or the use, handling, disposal or transportation of any Hazardous
Materials (including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, the Resource Conservation Recovery Act, the Clean
Water Aet, the Clean Air Act, and the applicable provisions of the California Health and Safety
Code and the California Water Code, as each such statute may from time to time be amended,
and the rules, regulations, and guidance documents promulgated pursuant to any such statute).
"Interest Rate" means the greater of 5.00% per annum or the sum of the Libor Rate and
..2.50% per annum. The Interest Rate shall be fixed for each calendar month based on the
applicable Libor Rate published on the last business day of the preceding calendar month.
"Interest Reserve" has the meaning given that term in Section 2.2(b).
"Lease" means the Ground Lease dated October, 28, 2005 between the Redevelopment
Agency of the City of Vernon, a public body corporate and politic and Matheson Tri-Gas, Inc., a
Delaware corporation, as .the Lease may be amended.
"Libor Rate" means the Libor rate published from time to time by The Wall Street
Journal as the interest rate now quoted each business day for obligations for six months'
maturity, under the caption "Money Rates, London Interbank Offered Rates (Libor)." If The
Wall Street Journal discontinues publishing Libor Rates, Lender shall select a comparable rate in
its place.
"Loan" means the loan in the amount of $6,370,000 made to Borrower pursuant to this
Agreement and the other Loan Documents.
"Loan Documents" means this Agreement, the Note, the Deed of Trust, the
Environmental Indemnity, the Assignment of Deposit Account and all documents, agreements
and instruments executed or otherwise delivered to evidence, secure or are otherwise delivered in
connection-with a Loan.
2
"Net Unrestricted Assets" has the same meaning and is calculated in the same manner as
is described in the "Notes to Basic Financial Statements" attached to the financial statements of
Borrower dated June 30, 2008 delivered to Lender.
"Note" means the Promissory Note dated the date of this Agreement in the amount of
$6,370,000 made by Borrower and payable to the order of Lender.
"Payment Date" has the meaning given that term in Section 2.2(a).
"Permits" means all. permits, licenses; operating authorizations; certificates, variances,
waivers, approvals or other authorizations of any kind issued or granted by any governmental
authority which are required in connection with the lawful and proper ownership, operation and
maintenance of the Property.
"Permitted Encumbrances" has the meaning given that term in Section 4.7.
"Potential Event of Default" means an event which, with the giving of notice or the lapse
of time, or both, would become an Event of Default.
"Property" has the meaning given that term in the Deed of Trust.
"Property Requirements" means (a) all zoning, building, environmental and other laws,
ordinances, rules, regulations, and restrictions of any governmental authority, including, without
limitation, the Americans with Disabilities Act to the extent applicable, the Subdivision Map Act
- and those relating to the presence of asbestos and/or hazardous wastes, (b) any building permits
or any conditions, easements, rights-of-way, covenants, restrictions of record or any recorded or
unrecorded agreement affecting or concerning the Property, including, without.limitation,
planned devel"opment permits, condominium declarations and any owner participation,
development or regulatory agreements with any governmental authority and (c) requirements of
insurance companies or similar organizations, affecting the operation and use of the Property or
consummation of the transactions contemplated by the Loan Documents.
"Revolving Loan Agreement" has the meaning given that term in the Recital above.
"Assignment of Deposit Account" means the Assignment of Deposit Account dated as of
the date of this Agreement executed by Borrower in favor of Lender.
ARTICLE II
LOAN
2.1. The Loan. Lender agrees, on the terms .and conditions set forth in this
Agreement, to make the Loan to Borrower. The Loan shall be evidenced by the Note. The Loan
is separate from, not made under and is not governed by the Revolving Loan Agreement.
2.2. Payments.
3
(a) On the first day of each month (each a "Payment Date"), Borrower shall
pay to Lender an amount which would repay the Loan at the Interest Rate in 180 equal monthly
payments. The amount of the monthly payment shall be recalculated with each change in the
Interest Rate, except that the number of equal monthly payments shall be reduced by the number
of months lapsed between the date of this Agreement and the date of the recalculation of the
payment. Interest shall be calculated on the basis of a 360-day year and actual number of days
elapsed.
(b) So long as no Event of Default has occurred and until the tenant under the
Lease actually begins paying the full amount of rent required under the Lease, monthly payments
due under Section 2.2(a) shall be drawn by Lender as and when due from an interest reserve
established by Borrower with Lender (the "Interest Reserve"). The initial deposit in the Interest
Reserve shall be $190,000.00, When the Interest Reserve contains less than the aggregate
amount which will be payable on the next two Payment Dates, Borrower shall deposit with
Lender an amount reasonably determined by Lender as the aggregate amount payable on the next
six Payment Dates. Borrower shall make such deposit within 15 days of such demand.
Borrower acknowledges that Lender's having the Interest Reserve is for the convenience of
Borrower and does not mitigate Borrower's obligation to make the payments required by Section
2.2(a) as and when due. Lender shall have no obligation to draw payments from the Interest
Reserve following the occurrence of a Potential Event of Default or an Event of Default. The
Interest Reserve shall be held subject to the terms of the Assignment of Deposit Account.
(c) Upon not fewer than two business days' notice and in amounts not less
than $25,000, Borrower may prepay the principal amount of the Loan without premium or fee.
2.3. Principal Re~a~ent. Borrower shall repay the Loan, together with all interest
accrued on the Loan and all other amounts outstanding under the Loan Documents, not later than
April 1, 2014.
2.4. Manner of Payment. All payments received by Lender later than 2:00 p.m. (Los
Angeles time) shall be considered received on the following business day. Lender may apply
any payments made pursuant to the terms of this Agreement. and the other Loan Documents in
such order as it shall determine in its. sole and absolute discretion.
2.5. Evidence of Debt.
(a) Borrower's indebtedness resulting from the Loan shall be evidenced by the
Note.
(b) The books and accounts of Lender shall be conclusive evidence, absent
manifest error, of the amount of the Loan, repayments, interest, fees and other charges advanced,
due, outstanding or paid pursuant to this Agreement.
2.6. Overdue Payments. Any amount payable under this Agreement or any other Loan
Document which is not paid when due (whether as a result of maturity, acceleration or
otherwise) shall bear interest, payable on demand, at a rate equal to the greater of (a) the sum of
the Libor Rate plus six percent per annum or (b) any other applicable default .rate provided for in
the Loan Documents.
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I
2.7. Net Pam. All payments made by Borrower under this Agreement and the
other Loan Documents shall be made without setoff or counterclaim and in such amounts as may
be necessary in order that all such payments (after deduction or withholding for or on account of
any future taxes, levies, imposts, duties or other charges of whatsoever nature imposed by any
government, any political subdivision or any taxing authority, including future taxes made
effective retroactively, other than any tax on or measured by the overall net income of Lender
pursuant to the income, bank or franchise tax laws of the United States or the State of California
(collectively, "Taxes")) shall not be less than the amounts otherwise specified to be paid under
this Agreement and the other Loan Documents.. A certificate as to any additional amounts
payable to Lender under this Section 2.7 submitted to Borrower by Lender shall show in
reasonable detail the amount payable and the calculations used to determine in good faith such
amount and shall be conclusive absent manifest error. Any amounts payable by Borrower under
this Section 2.7 with respect to past payments shall be due within five business days following
receipt by Borrower of such certificate from Lender; any such amounts payable with. respect to
future payments shall be due concurrently with such future payments. With respect to each
deduction or withholding for or on account of any Taxes, Borrower shall promptly furnish to
Lender such certificates, receipts and other documents as may be required (in the reasonable
judgment of Lender) to establish any tax credit to which Lender may be entitled. Without any
way affecting any of its rights under this Section 2.7, Lender agrees that, upon its becoming
aware that any of the present or future payments due it under this Agreement would be subject to
deduction for Taxes, it will notify Borrower in writing, and Lender further agrees that it will use
reasonable efforts not disadvantageous to it (in its sole determination) in order to avoid or
minimize, as the case may be, the payment by Borrower of any additional amount for Taxes
pursuant to this Section 2.7.
ARTICLE III
CONDITIONS PRECEDENT
3.1. Conditions Precedent. Lender's obligation to make the Loan is subject to Lender's
receipt of the following items or the satisfaction of the following conditions precedent, each in
form and substance satisfactory to Lender:
(a) the Loan Documents executed and delivered by Borrower; and
(b) an ALTA Loan Policy of Title Insurance issued by a title insurer
satisfactory to Lender, showing the Deed of Trust to be afirst-priority lien on the Property, in an
amount at least equal to the Loan, containing such endorsements as Lender shall require, not
containing any creditors' rights exclusion and including only such exceptions as shall be
approved by Lender.
(c) such financial statements concerning Borrower as Lender shall require;
(d) the following concerning Borrower: (i) a copy of Borrower's charter, (ii) a
certificate from Borrower, including a copy of resolutions, indicating that Borrower is authorized
to execute, deliver and perform the Loan Documents; and (iii) such other documents as Lender
shall request to evidence Borrower's existence and authorization to enter into and perform under
the Loan Documents;
5
(e) if Lender shall require, opinions of counsel to Borrower concerning such
matters as Lender shall require;
(f) a loan. fee in the amount of $63,700 and the payment of all of Lender's
costs of closing the Loan, including, without limitation, appraisal, legal,. title, recording, search,
investigation and filing costs;
(g) the entire principal balance of Subloan Three shall have been repaid;
(h) Borrower shall have deposited with Lender the sum of $ 190,000.00 as
the initial deposit in the Interest Reserve; and
(i) such other documents, agreements, certificates and assurances as Lender
shall reasonably require.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Borrower makes the representations and warranties set forth in this Article IV to Lender.
4.1. Existence. Borrower is municipal corporation duly organized, validly existing
and in good standing under the laws of California.
4.2. Power. Borrower has all necessary corporate power to enter into the Loan
Documents and perform its obligations under them.
4.3. Enforceability of Loan Documents. The Loan Documents have been duly
executed and delivered by Borrower and are the legal, valid and binding obligations of Borrower,
enforceable against Borrower in accordance with their respective terms.
4.4. No Conflict. Borrower's execution and delivery of, and its performance of its
obligations under, the Loan Documents do not and will not conflict with (a) any (i) contractual or
legal restriction or obligation, or (ii)-court or regulatory order, binding on or affecting Borrower,
or (b) any restriction contained in any of Borrower's constituent or governing documents.
4.5. Pending Litigation or Other Proceedings. There is no pending or, to the
knowledge of Borrower, threatened action, proceeding or investigation before any court,
governmental agency or arbitrator against or affecting Borrower, the Property or any of
Borrower's other assets which, if decided adversely to Borrower, would materially and adversely
affect the financial condition of Borrower or of any of Borrower's assets, including, without
limitation, the Property, or would materially and adversely affect the present or future ability of
Borrower to perform its obligations under the Loan Documents.
4.6. Solvency. Borrower is not insolvent and will not be rendered insolvent by the
transactions contemplated by the Loan Documents. After giving effect to such transactions,
Borrower will not be left with an unreasonably small amount of capital with which to engage in
6
its business or undertakings, nor will Borrower have intended to incur, or believe that it has
incurred, debts beyond its ability to pay such debts as they mature.
4.7. No Liens. There are no liens or encumbrances .upon or with respect to the
Property except the liens and encumbrances shown on the ALTA Policy of Title Insurance of
this date issued to Lender pursuant to Section 3.1(b) above (the "Permitted Encumbrances").
4.8. Title. Borrower has good, marketable and indefeasible title in fee to the "Real
Property" (as defined in the Deed of Trust), free and clear of all encumbrances except the
Permitted Encumbrances. The Deed of Trust, when properly recorded in the Official Records of
-Los Angeles County, together with its associated Uniform Commercial Code financing
statement, when properly filed with the California Secretary of State, will create, respectively,
(a) a valid, perfected first-priority lien on the Real Property, subject only to Permitted
Encumbrances, and (b) a valid, perfected first-priority security interest in the "Personal Property"
(as defined in the Deed of Trust) to the extent such a lien may be perfected by such a filing,
subject only to Permitted Encumbrances. Except for any Permitted Encumbrance or any lien
which has been "insured around" to the satisfaction of Lender, there are no liens or claims for
work, labor or materials affecting the Property. The Permitted Encumbrances do not materially
adversely impair Borrower's current use and operation of any of the Property or otherwise
materially adversely impair Borrower's ability to perform any of its obligations under the Loan
Documents.
4.9. Taxes. Borrower has paid and discharged all installments for the payment of
"Impositions" (as defined in the Deed of Trust) due to date, and all other material taxes, levies,
maintenance charges, utilities charges or any other governmental or private assessment or
'charge, imposed against, affecting or relating to the Property other than those which have not
become due, together with any fine, penalty, interest or cost for non-payment pursuant to such
returns or pursuant to any assessments received by it.
4.10. Property Requirements. The Property complies in all material respects with all
Property Requirements now affecting the Property. Without limiting the foregoing, all Permits,
including, without limitation, all certificates of occupancy necessary for the lawful occupation of
the Property, have been issued and are in full force and effect. Borrower has not received any
written notification or threat of any actions or proceedings regarding the noncompliance or
nonconformity of the Property with Property Requirements or Permits, nor is Borrower
otherwise aware of any such pending actions or proceedings.
4.11. Liability for Hazardous Materials. Borrower has no liability, contingent or
otherwise, under any Hazardous Materials Law or with respect to any activity involving
Hazardous Materials on or about the Property.
4.12. Hazardous Materials Activity. There exists no activity involving Hazardous
Materials on or about the Property in violation of any Hazardous Materials Law and Borrower
has not caused or, to the knowledge of Borrower, permitted to occur any condition which may
cause a release of any Hazardous Materials in violation of any Hazardous Materials Law on or
about the Property.
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4.13. Hazardous Materials Laws. (a) Neither Borrower nor, to the knowledge of
Borrower, any other party, has been or is involved in operations at the Property which could
reasonably be expected to lead to (i) the imposition of liability on Borrower under any
Hazardous Materials Law, or on any subsequent or former owner of the Property, or (ii) the
creation of a lien on the Property under any Hazardous Material Law; and (b) Borrower has not
permitted any tenant or occupant of the Property to engage in any activity that could reasonably
be expected to impose a claim or liability under any Hazardous Material Law on such tenant or
occupant, on Borrower or on any other subsequent or former owner of the Property.
4.14. Status of Landlord under Leases. Borrower is the owner and holder of the
landlord's interest under the Lease and there are no prior outstanding assignments of the Lease,
or any portion of the rents, additional rents, charges, issues or profits due and payable or to
become due and payable under the Lease.
4.15. Enforceability of Lease. The Lease constitutes the legal, valid and binding
obligation of Borrower and, to the knowledge of Borrower, of the tenant under the Lease,
enforceable in accordance with-its terms. No notice of any default under the Lease which
remains uncured has been sent by Borrower or received by Borrower from the tenant under any
Lease.
4.16. No Option- or Other Rights. The Lease is occupied by the tenant as a tenant only.
The Lease does not contain any option to purchase, right of first refusal or any other similar
provision. No option to purchase, right of first refusal or similar right exists with respect to the
Property.
4.17. Insurance. Borrower has complied with all of the requirements of Section 2.1.1 of
the Deed of Trust with respect to insurance.
4.18 Encroachments. None of the improvements located on the Property encroaches
upon the property of any other person nor lies outside of the boundaries and building restriction
lines of the Property and no improvement located on property adjoining the Property lies within
the boundaries of or in any way encroaches upon the Property.
4.19. Independent Unit. (a) The Property is an independent unit which does not rely on
any drainage, sewer, access, parking, structural or other facilities located on any property not
included in the Property or on public or utility easements for (i) the fulfillment of any zoning,
building code or other requirement. of any governmental- authority that has jurisdiction over the
Property, (ii) structural .support or (iii) the fulfillment of the requirements of the Lease or other
agreement affecting. the Property; (b) Borrower, directly or indirectly, has the right to use all
amenities, easements, public or private utilities, parking, access routes or other items necessary
or currently used for the operation of the Property; (c) all public utilities are installed and
operating at the Property and all billed installation and connection- charges have been paid in full;
and (d) the Property is either (i) contiguous to or (ii) benefits from an irrevocable unsubordinated
easement permitting access from the Property to a physically open, dedicated public street, and
has all necessary permits for ingress and egress and is adequately serviced by public water, sewer
systems and utilities. No building or other improvement not located on the Property relies on
any part of the Property to fulfill any zoning requirements, .building code or other governmental
8
or municipal requirements for structural support or to furnish to such building or improvement
any essential building systems or utilities.
4.20. Condition of Property. (a) The Property is in good condition, order and repair in
all material respects; (b) there exist no structural or other material defects in the Property,
whether latent or otherwise; and (c) Borrower has not received notice from any insurance
company or bonding company of any defects or inadequacies in the Property which would
adversely affect its insurability or cause the imposition of extraordinary premiums or charges for
insurance or of any termination or threatened termination of any policy of insurance or bond. To
Borrower's knowledge, no claims have been made against any contractor, architect; engineer or
other party with respect to the condition of the Property or the existence of any structural or other
material defect with respect to the Property.
4.21. No Contractual Defaults. There are no material defaults by Borrower or, to
Borrower's knowledge, by any former owner or any other person under any material contract to
which Borrower is a party relating to the Property, including, without limitation, any
management, rental, service, supply, security, maintenance or similar contract. Neither
Borrower nor, to Borrower's knowledge, any former owner has received notice or has any
knowledge of any existing circumstances in respect of which it could receive any notice of
default or breach in respect of any material contracts affecting or concerning the Property.
4.22. Financial Position. The financial statements and all financial data delivered to
Lender relating to Borrower and the Property are true, correct and complete in all material
respects. Such financial statements fairly present the financial position of the parties or
properties who are their subjects as of the dates indicated. No material adverse change has
occurred in such financial position since the date of such financial statements.
4.23. Disclosure.. None of Borrower's representations or warranties contained in this
Agreement or any other document,- certificate or written statement furnished to Lender by or on
behalf of Borrower contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements contained in this Agreement or in such other
document, certificate or written statement (when taken in their entirety) not misleading.. There is
no fact known to Borrower which materially or adversely affects the business, operations, assets
or condition (financial or otherwise) of Borrower or the Property which has not been disclosed in
this Agreement or in another written statement delivered to Lender by Borrower.
ARTICLE V
COVENANTS
•While any. obligation of Borrower under the Loan Documents remains outstanding,
Borrower shall comply with the following covenants.
5.1. Organization and Status of Borrower. Borrower shall maintain its corporate
existence and all licenses and permits relating thereto in good standing with the State of
California.
5.2. Compliance with Laws. Borrower shall- remain in compliance in all material
respects with all laws and requirements applicable to its business and obtain all authorizations,
9
consents, approvals, orders, licenses, exemptions from, and accomplish all filings or registrations
or qualifications with, any governmentaLagency that are necessary for the transaction of its
business.
5.3. Governmental Approvals. Borrower shall deliver to Lender from time to time at
Lender's request, in form-and substance satisfactory to Lender, evidence that Borrower has
complied with all applicable Property Requirements and that all Permits have been regularly and
finally received with respect to the Property.
5.4. Books and Records. Borrower shall maintain full and complete books of account
and other records reflecting the results of its operations and the operations of the Property, in
accordance with generally accepted accounting principles applied on a consistent basis,. and
permit Lender and its agents, at all reasonable times and from time to time, to inspect and copy
any such books and records.
5.5. Maintenance of Property. Borrower shall maintain the Property in good condition
and repair; take precautions against the occurrence of damage thereto; and not permit any waste
. with respect to the Property.
5.6. Notice of Certain Matters. Borrower shall give notice to Lender, promptly upon
learning thereof, of each of the following:
(a) any litigation or claim of any kind affecting or relating to the Property and
involving an amount in excess of $50,000; and any litigation or claim of any kind that might
subject Borrower to liability in excess of $1,000,000, whether covered by insurance or not;
(b) any material dispute between Borrower and any governmental agency;
(c) any threat or commencement of proceedings in condemnation or eminent
domain relating to the Property;
(d) the occurrence of any Event of Default or Potential Event of Default and
Borrower's plans for curing same;
(e) the existence of any lien or encumbrance on the Property other than as
permitted by the terms of the Loan Documents; and
(f) any other event or condition causing a material adverse change in the
financial condition of Borrower.
5.7. Further Assurances. Borrower shall execute and acknowledge (or cause to be
executed and acknowledged) and deliver to Lender all documents, and take all actions, required
by Lender from time to time to confirm the rights created or now or hereafter intended to be
created under the Loan Documents and the transactions contemplated thereunder, to maintain,
protect, perfect and further the validity, priority and enforceability of the Loan Documents and
all liens on the Property or other collateral for Borrower's obligations under the Loan.
Documents, to subject to the Loan Documents any property intended by the terms of any Loan
Document to be covered by such Loan Documents.
10
5.8. Information. Borrower shall furnish the following information, reports and notices
to Lender in form. and substance reasonably satisfactory to Lender:
(a) as soon as available but in no event later than 90 days after the end of each
calendar year, (i) the balance sheet and income statements of Borrower, comparing the figures in
such statements to those-for the previous year, all in reasonable detail, and (ii) a report showing
the calculation of Borrower's compliance with the interest coverage covenant set forth in Section
5.12 below for the fiscal year and both halves of the fiscal year, accompanied by the certificate
of an independent certified public accountant satisfactory to Lender, stating that such financial
statements have been prepared in accordance with generally accepted accounting principles,
consistently applied, and that such financial statements fairly present the financial condition. of
Borrower for such year and period;
(b) as soon as available but in no event later than 90 days after the end of the
first half of each fiscal year, the same statements as are required by Section 5.8(a), accompanied
by the certificate of a representative of Borrower satisfactory to Lender stating that such
statements have been prepared in accordance with generally accepted accounting principles,
consistently applied, and that such statements fairly present the financial condition of Borrower .
for such period;
(c) as soon as available but in no event later than 90 days after the end of each
fiscal year and period six months after the end of the fiscal year, an operating statement of the
Property's income and expenses for the semi-annual period then ended comparing such operating
results to those for (i) the immediatelypreceding quarter, and (ii) the same period in the previous
year, all in reasonable detail, accompanied by the certificate of a representative of Borrower
reasonably satisfactory to Lender stating that the operating statement has been prepared in
accordance with generally accepted accounting principles consistently applied, and that such
operating statement fairly presents the results of operations for the Property for the period
presented;-
(d) such other information concerning the Property as is required by the Loan
Documents or Lender from time to time; and
(e) .all other information, reports and notices relating to the Property and
Borrower that Lender shall reasonably request.
5.9. Inspection. Borrower, upon reasonable notice and during regular business hours,
shall make the Property available to Lender and Lender's agents for inspection and appraisal
from time to time.
5.10. Deposits. Borrower shall use its best efforts to maintain on deposit with Lender
aggregate funds in an amount not less than $30,000,000, -such deposits not to earn interest at a
rate greater than the federal funds rate minus .25% per annum. from time to time.
5.11. Unrestricted Net Assets.
(a) .Borrower. shall at all times maintain Unrestricted Net Assets in an amount
not less than $25,000,000.
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(b) On each December 31 and June 30, the ratio of the amount of all Debt to
Unrestricted Net Assets shall not exceed 1.00:1.00.
5.12. Coverage Ratio. The ratio during each period of the first and second halves of
Borrower's fiscal year of (a) net income from the City of Vernon Electric System, without
deduction for interest expense on bond obligations owed directly or indirectly by Borrower, to
(b) the sum of interest expense on all bond obligations owed directly or indirectly by Borrower
and the amount of interest accrued on all indebtedness owing to Lender, shall not be less than
1.30:1.00.
ARTICLE VI
EVENTS OF DEFAULT
6.1. Events of Default. The occurrence of any of the following, shall be an "Event of
Default":
(a) Borrower's failure to pay when due any amount owing under any Loan
Document (including, withoutlimitation, any failure by Borrower to replenish a Loan's interest-
- reserve within 15 days, following. Lender's demand in accordance with Section 2.2(b));
(b) Any breach of the covenants set forth in Sections 5.10, 5.11 or 5:12,
Borrower's failure to maintain insurance of the kinds and in the amounts required by the Loan
Documents or Borrower's failure to make the Property available for inspection by Lender on the
terms required by the Loan Documents;
(c) Except as provided in Sections 6.1(a), (b) or (e), the failure of Borrower,
within 30 days following written notice from Lender, to observe or perform any covenant or
other agreement contained in this Agreement; provided, however, that the notice and 30-day
grace period set forth above shall be applicable only to a failure to observe or perform any
covenant or other agreement which is reasonably susceptible of being cured; provided further,
that should Borrower be unable to cure its failure within such 30-day period despite beginning to
cure such failure promptly after receipt of notice and prosecuting such attempt diligently during
such 30-day period, the cure period shall be extended an additiona130 days so long as Borrower
continues diligently to prosecute the cure during such additional period;
(d) . any written representation, warranty or financial statement given by
Borrower shall have been untrue in any material respect when given;
(e) .the occurrence of a default under any Loan Document and the failure of
any such default to be cured during the permitted time, if any, for such cure;
(f) Borrower shall be unable or shall admit in writing its inability to pay its
debts when due, or shall make an assignment for the benefit of creditors; or Borrower shall apply
for or consent to the appointment of any receiver, trustee or similar officer for such person or for
all or any substantial part of Borrower's property; or any of them shall institute (by petition,
application, answer, consent or otherwise) any bankruptcy, insolvency, reorganization,
arrangement, readjustment of debts, dissolution, liquidation, or similar proceedings relating to
Borrower under the laws of any jurisdiction;
12
(g) if a receiver, trustee or similar officer shall be appointed for Borrower or
for all or any substantial part of Borrower's property without the application or consent of such
person, and such appointment shall continue undischarged for a period of 60 days (whether or
not consecutive); or any bankruptcy, insolvency, reorganization, arrangement, readjustment of
debt,, dissolution, liquidation or similar proceedings shall be instituted (by petition, application or
otherwise) against any such person and shall remain undismissed for a period of 60 days
(whether or not consecutive);
(h) the Property, Interest Reserve, Environmental Remediation Reserve or all
or any material part of the assets of Borrower shall become subject to attachment, execution or
judicial seizure (whether by enforcement of money judgment, by writ or warrant of attachment,
or by any other process).;
(i) Borrower shall be in default in the payment of any indebtedness or the
performance of any other obligation secured by a lien on the Property and such default is not
cured within the time, if any, specified for such a cure in any applicable agreement; or
(j) any of the Loan Documents shall cease to be a valid, binding and
enforceable obligation of the person purported to be bound; or the lien of the Deed of Trust or
any other Loan Document securing any of Borrower's obligations shall cease to be a valid,
enforceable, perfected, first-priority lien on the Property; or Borrower shall assert such cessation
or failure in writing.
6.2. Remedies upon Default. Upon the occurrence of any Event of Default, Lender
may, at its- option, do any, of the following:
(a) declare the principal of all amounts owing under the Loan Documents,
together with all accrued interest thereon and all other amounts owing in connection therewith, to
be immediately due and payable, regardless of any other specified maturity or due date, without
notice of default, presentment or demand for payment, notice or demand of any kind, and
without the necessity of prior recourse to any security;
(b) if the Event of Default may be cured by the payment of money, Lender
may (but shall not be obligated) to make such payment from its own funds; provided, that the
making of such payment by Lender shall not be deemed to cure such Event of Default, and that
the same shall not be cured unless and until Borrower reimburses Lender for such payment. If
Lender advances its own funds for such purposes, the funds advanced shall be secured by the
applicable Loan Documents, notwithstanding that-such advances may cause the total amount
advanced under this Agreement to exceed the aggregate amount available under this Agreement
or the amount committed to be advanced pursuant to this Agreement; and
(c) exercise any of its rights under the Loan Documents, including the right to
foreclose on any security, and exercise any other rights with respect to any security, whether
under the Loan Documents or as provided by law, all in such order and in such manner as Lender
in its sole discretion may determine.
6.3. Cumulative Remedies; No Waiver. Lender's remedies under the Loan Documents
are cumulative and shall be in addition to all rights and remedies provided by law or in equity
13
from time to time. The exercise by Lender of any right or remedy shall not constitute a cure or
waiver of any default, nor invalidate any notice of default or any act done pursuant to any such
notice, nor prejudice Lender in the exercise of any other right or remedy. No waiver by Lender
of any default shall be implied from any omission by Lender to take action on account of such
default if such default persists or is repeated. No express waiver by Lender of any default shall
affect any default other than the default expressly waived, and any such express waiver shall be
operative-only for the time and to the extent of any Loan Document shall be construed as a
waiver of any subsequent breach of the same covenant, term or condition. Lender's consent to or
approval of any act by Borrower requiring further consent or approval shall not be deemed to
waive or render unnecessary Lender's, consent to or approval of any subsequent act.
ARTICLE VII
MISCELLANEOUS
7.1. Notices. Any notice, demand or request required under this Agreement shall be
given in writing at the addresses. set forth below by personal service; telecopy; overnight courier;
or registered or certified, first class. mail, xeturn receipt requested.
If to Borrower:
.City of Vernon
4305 Santa Fe Avenue
Vernon, CA 90058
Attention: City Administrator
Fax No.: (323) 826-1438
If to Lender:
East West Bank
135 N. Los Robles Ave., Suite 600
Pasadena, CA 91101
Attention: Flora Ling
Fax No.: (626) 817-8898
Such addresses may be changed by notice to the other parties given in the same manner as
required above. Any notice, demand or request shall be deemed received as follows: (i) if sent
by personal service, at the time such personal. service is effected; (ii) if sent by telecopy, upon'the
sender's receipt of a confirmation report generated by the sender's telecopier indicating receipt by
the recipient's telecopier; (iii) if sent by overnight courier, on the business day immediately.
following deposit with the overnight courier; and (iv) if sent by mail, 48 hours following deposit
in the mail.
7.2. Governing Law: All questions with respect to the construction of this Agreement
- and the rights and liabilities of the. parties to this Agreement shall be governed by the laws of the
State of California.
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7.3. Binding on Successors. This Agreement shall inure to the benefit o_ f, and shall be
binding upon, the successors and assigns of each of the parties to this Agreement.
7.4. Attorneys' Fees.
(a) Borrower. shall reimburse Lender for all reasonable attorneys' fees, costs
and expenses, incurred by Lender in connection with the enforcement of Lender's rights under
this Agreement and each of the other Loan Documents, including, without limitation, reasonable
attorneys' fees, costs and expenses for trial, appellate proceedings, out-of-court negotiations,
workouts and settlements or for enforcement of rights under any state or federal statute,
including, without limitation, reasonable attorneys' fees; costs and expenses incurred to protect
Lender's security and attorneys' fees, costs and expenses incurred in bankruptcy and insolvency
proceedings such as (but not limited to) seeking relief from stay in a bankruptcy proceeding.
The term "expenses" means any expenses incurred by Lender in connection with any of the out-
of-court, or state, federal or bankruptcy proceedings referred to above, including, without
limitation, the fees and expenses of any appraisers, consultants and expert witnesses retained or
consulted by Lender in connection with any such proceeding.
(b) Lender shall also be entitled to its attorneys' fees, costs and expenses.
incurred in any post-judgment proceedings to collect and enforce the judgment. This provision
is separate and several and-shall survive the merger of this Agreement into any judgment on this
Agreement.
7.5. Counterparts. This Agreement may be executed in any number of original
counterparts, each. of which shall be deemed an original, but all of which when taken together
shall constitute one instrument. The original signature page of any counterpart may be detached
from such counterpart and attached to any other counterpart identical to such counterpart (except
having additional signature pages executed by other parties to this Agreement) without impairing
the legal effect of any such signature(s).
7.6. Entire Agreement. This Agreement and the other Loan Documents constitute the
entire agreement and understanding between the parties in respect of the subject matter of this
Agreement and supersede all prior agreements and understandings with respect to such subject
matter, whether oral or written.
7.7. Waivers. Waiver by Lender of any term, covenant or condition under this
Agreement or the Loan Documents, or of any default by Borrower under this Agreement or the
Loan Documents, or any failure by Lender to insist upon strict performance by Borrower of any
term, covenant or condition contained in this Agreement or the Loan Documents, shall be
effective or binding on Lender only if made in writing by Lender; no such wavier shall be
implied from any omission by Lender to take action with respect to any such term, covenant,
condition or default. No express written waiver by Lender of any term, covenant, condition or
default shall affect any other term, covenant, condition or default or cover any other time period
than the application of any such term, covenant or condition to the matter as to which a waiver
has been given or the default or time period specified in such express waiver. This Agreement
may be amended only by an instrument in writing signed by the parties to this Agreement.
15
7.8. Severability. If any part of this Agreement is declared invalid for any reason,
such shall not affect the validity of the rest of the Agreement. The other parts of this Agreement
shall remain in effect as if this Agreement had been executed without the invalid part. The
parties declare that they intend and desire that the remaining parts of this Agreement continue to
be effective without any part. or parts that have been declared invalid.
7.9. Reimbursement Obli atg ions. Borrower shall reimburse Lender upon demand for
all payments made by Lender. and all costs and expenses incurred by Lender, whether such costs.
and expenses are the result of work performed by Lender's employees or by independent
contractors (including attorneys' fees and related expenses as set forth in Section 7.4 above, fees.
and expenses incurred in connection with any appraisal or inspection of the Property and review
of any such appraisal of the Property, and fees and expenses of all inspectors, accountants and
other outside experts retained by Lender), in connection with the negotiation, preparation,
execution, delivery, administration, modification, performance and enforcement of the Loan
Documents, the performance by Lender of its obligations under the Loan Documents, taking
such actions under the Loan Documents that Lender is entitled to take and all matters related
thereto, including, but not limited to, the following:
(a) title insurance premiums, casualty and liability insurance premiums; bond
premiums, realty tax services, recording fees, filing fees, documentary or stamp taxes and release
and reconveyance fees;
(b) funds advanced by Lender to protect its rights under the Loan Documents
or with respect to any collateral securing the obligations of Borrower under the Loan Documents
(including, without limitation, payments to the holder of any lien on or other interest in the
Property, whether senior or subordinate to any deed of trust);
(c) all liabilities, losses, costs and expenses suffered or incurred by Lender as
a direct or indirect result of any Event of Default or Potential Event of Default;
(d) costs and expenses (including; without limitation, costs of suit or
attorneys' fees) arising out of Lender's commencement of, appearance in and/or defense of any
action or proceeding purporting to affect the rights or duties of the parties to, or the payment of
any funds under, any Loan Document; and
(e) all claims, demands, actions, causes of action, liabilities, losses,
commissions, costs and expenses against which Lender is indemnified under this Agreement or
the other Loan Documents.
Borrower's reimbursement obligations hereunder shall be secured by the Loan Documents, shall
survive as unsecured obligations to the extent unpaid as of the date of any release and
reconveyance of the Loan Documents, and shall bear interest following demand at any default
rate provided for in the Loan Documents.
7.10. Indemnity. Borrower shall indemnify and hold harmless Lender and its directors;
officers, agents and employees (collectively, the "indemnitees") from and against, and agrees to
defend the indemnitees, by counsel satisfactory to the indemnitees, against:
16
(a) all claims, demands, liabilities, damages, costs and causes of action
asserted against any indemnitee if the claim, demand, liability, damage, cost or cause of action
directly or indirectly relates to (i) a claim, demand, liability, damage, cost or cause of action that
any person or entity has or asserts against Borrower in connection with the Property; (ii) the
payment of any commission, charge or brokerage fee incurred in connection with the Loan
Documents (unless based on any act or representation of Lender); (iii) any act or omission by
Borrower, any contractor, subcontractor or material supplier, engineer, architect or other person
or entity with respect to the Property; (iv) the Loan or the ownership, occupancy or use of the
Property; and
(b) all liabilities, losses and other costs (including court costs and attorneys'
fees) incurred by any indemnitee as a result of any claim, demand or cause of action described in
subparagraph (a).
Lender's rights of indemnity shall not be directly or indirectly limited, prejudiced, impaired or
eliminated in any way by a finding or allegation that Lender's conduct is active, passive or
subject to any other classification or that Lender is directly or indirectly responsible under any
theory of any kind for any act or omission by Borrower or any other person or entity other than
Lender, its agents,. servants or employees. Borrower's obligations. under this Section 7.10 shall
survive the release and reconveyance of the Loan Documents.
[Signatures appear on following page.]
17
Lender:
EAST WEST BANK,
a California banking corporation
By:
Flor ing, Se` or Vice President
Borrower:
CITY OF VERNON,
a municipal corporation
By: ,i4/~~
Name:Hi 1 ari n (~nn~a1 PG
Title: Mayor
ATTEST:
d
City Clerk
Manuela Giron
APPROVE AS TO FORM:
C' t ey
J A arrison
ENVIRONMENTAL INDEMNITY
THIS ENVIRONMENTAL INDEMNITY is entered into as of May 7, 2009, by
.CITY OF VERNON, a California municipal corporation ("Indemnitor"), for the benefit of EAST
WEST BANK, a California banking corporation ("Lender"), and each of its successors, assigns
and participants, and its and their respective parent, subsidiary and affiliated corporations, and
their respective directors, officers, agents, attorneys and employees of each of them (each
individually, an "Indemnitee" and collectively, "Indemnitees").
RECITALS
A. Indemnitor is the maker of the Promissory Note of this date (the "Note")
in the principal amount of $6,370,000 payable to the order of Lender. The Note evidences a loan
from Lender to Indemnitor governed by the Loan Agreement dated as of .the date of this
Agreement between Indemnitor and Lender (the "Loan Agreement"). The Note and Loan
Agreement are secured by the Deed of Trust, Security Agreement, Assignment of Rents and
Fixture Filing dated as of the date of this Indemnity executed by Indemnitor for the benefit of
Lender. ("Deed of Trust"). The Deed of Trust encumbers the "Property" (as defined in the Deed
of Trust).
B. Lender requires Indemnitor to execute this Indemnity as a condition
precedent to Lender's entering into the Loan Agreement. Indemnitor is willing to execute this
Indemnity because of the benefits of Lender's entering into the Loan. Agreement.
AGREEMENT
L Indemnity. Indemnitor shall be solely responsible for, and shall indemnify
and hold harmless each Indemnitee from and against, any loss, damage, cost, expense, claim or
liability directly or indirectly arising out of or attributable to the use; generation; storage; release;
threatened release, discharge or disposal; or presence of "Hazardous Materials" (as defined
below) on or about the Property, including, without limitation: (a) all consequential damages
incurred by any Indemnitee; (b) the costs of any required or necessary repair, cleanup or
detoxification of the Property and the preparation and implementation of any closure, remedial or
other required plans; and (c) all reasonable costs and expenses incurred by any Indemnitee in
connection with clauses (a) and. (b), including, without limitation, reasonable attorneys' fees.
For purposes of this Indemnity, the following terms shall have the
following definitions:
"Hazardous Materials" means (i) any chemical, compound, material,.
mixture or substance that is now or hereafter defined or listed in, or otherwise classified pursuant
to, any "Hazardous Materials Law" (as defined below) as a "hazardous substance", "hazardous
material", "hazardous waste", "extremely hazardous waste", "acutely hazardous waste",
"radioactive waste", "infectious waste", "biohazardous waste", "toxic substance", "pollutant",
"toxic pollutant", "contaminant" as well as any formulation not mentioned herein intended to
define, list, or classify substances. by reason of deleterious properties such as ignitability,
I
eorrosivity, reactivity, carcinogenicity, toxicity, reproductive toxicity "EP toxicity," or "TCLP
toxicity' ; (ii) petroleum, natural gas, natural gas liquids, liquified natural gas, synthetic gas
usable for fuel (or mixtures of natural gas and such synthetic gas) and ash produced by a
resource recovery facility utilizing a municipal solid waste stream, and drilling fluids, produced
waters and other wastes associated with the exploration, development or production of crude oil,
natural gas, or geothermal resources; (iii) "hazardous substance" as defined in Section 25281(f)
of the California Health and Safety Code; (iv) "waste" as defined in Sectiori 13050(d) of the
California Water Code (v) asbestos in any form; (vi) urea formaldehyde foam insulation; (vii)
transformers or other equipment which contain dielectric fluid containing levels of
polychlorinated biphenyls (PCBs) in excess of fifty (50) parts per million; (viii) radon; and (ix)
any other chemical, material, or substance-that, because of its quantity, concentration, or physical
or chemical characteristics, exposure to which is limited or regulated for health and safety
reasons by any governmental authority, or which poses a significant present or potential hazard
to human health and safety or to the environment if released into the workplace or the
environment.
"Hazardous Materials Laws" means all present and future federal, state
and local laws, ordinances, regulations, permits, guidance documents, policies, decrees, orders
and any other requirements, whether statutory, regulatory or contractual, of governmental
.authorities relating to health, safety, the environment or the use, handling, disposal or
transportation of any Hazardous Materials (including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, the Resource Conservation
Recovery Act, the Clean Water-Act, the Clean Air Act, and the applicableprovisions of the
California Health and Safety Code and the California Water Code, as each such statute may from
time to time be amended, and the. rules, regulations, and guidance documents promulgated
pursuant to any such statute).
2. Indemnity Procedure.
(a) If any Indemnitee notifies Indemnitor of ariy claim or notice of the
commencement of any action, administrative or legal proceeding or investigation as to which
Indemnitor's obligation to indemnify under Section 1 above applies, Indemnitor shall assume on
behalf of such Indemnitee, and conduct with due diligence and in good faith, the investigation
and defense of, and the response to, such claim, action, proceeding or investigation, with counsel
reasonably satisfactory to the Indemnitee; provided, however, that such Indemnitee shall have
the right to be represented by advisory counsel of its own selection and at its own expense; and
provided, further, that if any such claim, action, proceeding, or investigation involves both
Indemnitor and an Indemnitee, and such Indemnitee shall have reasonably concluded that there
may be legal defenses available to it which are different from, additional to, or inconsistent with
those available to Indemnitor, then the Indemnitee .shall have the right to select separate counsel
to participate in the investigation and defense of and response to such claim, action, proceeding
or investigation on its own behalf at Indemnitor's expense.
(b) If any claim, action, proceeding, or investigation arises. as to which
Indemnitor's duty to indemnify under this Indemnity applies, and Indemnitor fails to assume
promptly (and in any event within ten days after being notified of the claim, action, proceeding,
or investigation) the defense. of an Indemnitee, then such Indemnitee may contest and settle the
2
.claim, action, proceeding, or investigation at Indemnitor's expense using counsel selected by
such Indemnitee; provided, however, that after any such failure by Indemnitor no such contest
need be made by such Indemnitee and settlement or full payment of any claim may be made by
such Indemnitee without Indemnitor's consent and without releasing Indemnitor from any
obligations to such Indemnitee under this Indemnity.
3. Damages Unrelated to Loan. This Indemnity is given solely to protect
Lender and the other Indemnitees against claims, losses, damages, costs, expenses, claims and
liabilities, and not as additional security for, or as a means of repayment of, the .loans evidenced
by the Note. The obligations of Indemnitor under this Indemnity are. independent of, and shall
not be measured or affected by (a) any amounts at any time owing under the Note or secured by
any Deed of Trust, (b) the sufficiency or insufficiency of any collateral (including, without
limitation, the Property) given to Lender to secure the Note, (c) the consideration given by
Lender or any other party in order to acquire the Property; (d) the modification, expiration or
termination of any Deed of Trust or any other document or instrument securing or otherwise
relating to the loan evidenced by the Note, or (e) the payment in full or other cancellation of the
Note (including, without limitation, by amounts paid or credit bid at a foreclosure sale or by
discharge in connection with a deed in lieu of foreclosure). Indemnitor's obligations under this
Indemnity are not secured, whether by a Deed of Trust or otherwise.
4. Survival of Sale by Indemnitor. Indemnitor's obligations under this
Indemnity shall survive the sale or other transfer of the Property by Indemnitor. The rights of
each Indemnitee under this Indemnity shall be in addition to any other rights and remedies of
- such Indemnitee against Indemnitor under any other document or instrument executed by such
Indemnitor, or at law or in equity (including, without limitation, any right of reimbursement or
contribution pursuant to CERCLA), and shall not in any way be deemed a waiver of any of such
rights. Indemnitor agrees that it shall have no right of contribution or subrogation against any
other Indemnitor (if more than one Indemnitor), unless and until all obligations of such
Indemnitor under this Indemnity have been satisfied. Each Indemnitor further agrees that, to the
extent that the waiver of its rights of subrogation and contribution is found by a court of
competent jurisdiction to be void or voidable for any reason, any rights of subrogation or
contribution such Indemnitor may have shall be junior and subordinate to the rights of each
Indemnitee against each Indemnitor.
5. Subro ag
tion. If Indemnitor fails to indemnify the Indemnitees as provided
in this Indemnity, the Indemnitees shall be subrogated to any rights Indemnitor may have against
third parties relating to the matters covered by this Indemnity.
6. Attorneys' Fees.
(a) Indemnitor shall reimburse each Indemnitee for all reasonable
attorneys' fees, costs and expenses, incurred by such Indemnitee in connection with the
enforcement of such Indemnitee's rights under this Agreement, including, without limitation,
reasonable attorneys' fees, costs and expenses for trial, appellate proceedings, out-of-court
negotiations, workouts and settlements or for enforcement of rights under any state or federal
statute, including, without limitation, reasonable attorneys' fees, costs and expenses incurred to
protect such Indemnitee's security and attorneys' fees, costs and expenses incurred in bankruptcy
3
and insolvency proceedings such as (but not limited to) seeking relief from stay in a bankruptcy
proceeding. The term "expenses" means any expenses incurred by any Indemnitee in connection
with any of the out-of-court, or state, federal or bankruptcy proceedings referred to above,
including, without limitation, the fees and expenses of any appraisers, consultants and expert
witnesses retained or consulted by such Indemnitee in connection with any such proceeding.
(b) Indemnitee shall also be entitled to its attorneys' fees, costs and
expenses incurred in any post judgment proceedings to collect and enforce any judgment arising
out of this Agreement. This provision is separate and several and shall survive the merger of this
Agreement into any judgment on this Agreement.
7: Successors and Assigns. This Indemnity shall be binding upon
Indemnitor, its successors and assigns, and shall inure to the benefit of and shall be enforceable
by each Indemnitee, its successors, and assigns (including, without limitation, any entity to
which the Lender assigns or sells all or any portion of its interest in the Note).
8. Notices. Any notice, demand or'request required under this Indemnity
shall be given in writing at the addresses set forth below by personal service; telecopy; overnight
courier; or registered or certified, first class mail, return receipt requested.
If to Indemnitor:
City of Vernon
4305 Santa Fe Avenue
Vernon, California 90058
Attention: City Administrator
Fax No.: (323). 826-1438
If to Indemnitee:
East West Bank
135 N. Los Robles
Pasadena, California. 91101.
Attention: Flora Ling
Fax No.: (626) 817-8898
Such addresses may be changed by notice to the other parties given in the same manner as
.required above. Any notice, demand or request shall be deemed received as follows: (a) if sent
by personal service, at the time such personalservice is effected; (b) if sent by telecopy, upon the
sender's receipt of a confirmation report indicating receipt by the recipient's telecopier; (c) if sent
by overnight courier, on the business day immediately following deposit with the overnight
courier; and (d) if sent by mail, three business days following deposit in the mail.
9. Separate Actions.. Multiple actions may be brought and judgments
obtained under this Indemnity. A separate and new right of action arises each time that a claim
or liability arises under this Indemnity.
4
10. Governing Law. This Indemnity shall be governed and construed in
accordance with the laws of the State of California.
11. Severability. All provisions contained in this Indemnity are severable and
the invalidity or unenforceability of any provision shall not affect or impair the validity or
enforceability of the remaining provisions of this Indemnity.
12. Entire Agreement. This Indemnity constitutes the entire agreement and
supersedes all prior agreements and understandings; both written -and oral, between the parties
with respect to the subject matter contained in this Indemnity.
13. Counterparts. This Indemnity may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which taken together shall
constitute one and the same agreement.
(Signatures on next page)
5
CITY OF VERNON,
a municipal corporation
By: ~
Name:Hilario Gonza es
Title: Mayor.
ATTEST:
By: ~.~.L
City Clerk
Manuela Giron
APPROVED S TO FORM:
City orn
~ Jef H rison
S-1
Signature Page to Environmental Indemnity
PROMISSORY NOTE
May 7, 2009
Pasadena, California
$6,370,000
FOR VALUE RECEIVED, CITY OF VERNON, a California municipal corporation
("Maker"), having its principal place of business at 4305 Santa Fe Avenue, Vernon, California
90058, promises to pay to the order of EAST WEST BANK, a California banking corporation
("Payee"), at 135 N. Los Robles, Pasadena, CA 91101, or at such other place as the holder of
this Note-from time to time may designate in writing, the principal sum of Six Million Three
Hundred Seventy Thousand Dollars ($6,370,000), or so-much of such amount as may from time
to time be disbursed and unpaid, together with interest on the unpaid principal amount of this
Note from time to time outstanding in lawful money of the United States of America, all as
provided in the Loan Agreement dated as of May 7, 2009 between Maker and Payee (the "Loan
Agreement").
1: Reference to Loan Agreement. This Note evidences the loan made under the
Loan Agreement. The loan shall be disbursed, bear interest and mature, and Maker shall pay
interest and repay principal all as provided in the Loan Agreement.
2. Loan Documents. This Note, the Loan Agreement and all other documents,
agreements and instruments evidencing or delivered in connection with the loans made pursuant
to this Note are collectively referred to in this Note as the "Loan Documents."
3. Late Charges. If any installment of principal or interest or any other amount due
under this Note or the other Loan Documents shall become overdue for a period longer than 11
days, Maker shall pay to Payee a late charge of eight cents for each dollar so overdue. Maker
acknowledges that late payment to Payee will cause Payee to incur costs it would not have to
incur had payment been timely made, the exact amount of such costs being difficult and
impracticable to assess. Such costs include, without limitation, processing and accounting
charges and the potential costs to be incurred as a result of Payee's frustration and inability to
meet its other commitments. The parties agree that the late charges represent a reasonable sum
considering all of the circumstances existing as of the date of this Note and represent a fair and
reasonable estimate of the costs that Payee will incur by reason of late payment.. The parties
further agree that proof of actual damages would be costly and inconvenient. Acceptance of any
late charge shall not constitute a waiver of the default with respect to the overdue amount, and
shall not prevent Payee from exercising any of the other rights and remedies available to Payee.
The late charges shall be due and payable immediately without demand and shall be secured by
the Loan Documents.
4. ,Event of Default. Upon the occurrence and during the continuance of any "Event
of Default" (as defined in the Loan Agreement), Payee, at its option, may:
1
(a) collect interest on the entire unpaid principal amount of this Note from
time to time outstanding at the default rate of interest provided for in Section 2.6 of the Loan
Agreement from the occurrence of such Event. of Default;
(b) declare all of Maker's obligations under this Note and any other Loan
Document to be immediately due and payable, without notice, notice being expressly waived;
.and.
(c) pursue each other right, remedy. and power available to it under this Note
or any of the .other Loan Documents or available to it at law or in equity.
5. Remedies. The rights, remedies and powers of Payee, as provided in this Note
and the. other Loan Documents, are cumulative and concurrent, and may be pursued singly,
successively or together against Maker, the property described in any of the Loan Documents-
and any other security given at any time to secure the payment of Maker's obligations, all at the
sole discretion of Payee. Payee may resort to every other right or remedy available at law or in
equity without first exhausting the. rights and remedies contained in this Note or the other Loan
Documents, all in Payee's sole discretion. Failure of Payee, for any period of time or on more
than one occasion, to exercise its option to accelerate the maturity of this Note shall not
constitute a waiver of the right to exercise such right at any time during the continued existence
of any Event of Default under any of the Loan Documents or in the event of any subsequent
Event of Default under this Note or any of the other. Loan Documents. Payee shall .not by any
other omission or act be deemed to waive any of its rights or remedies under the this Note or the
other Loan Documents unless such waiver is contained in a writing signed by Payee, and then
only to the extent specifically set forth in such writing. A waiver in connection with one event .
shall not be construed as continuing or as a bar to or waiver of any right or remedy in connection
with a subsequent event.
6. Waivers and Consents. Maker and each endorser, surety or accommodation party
of this Note and each other person liable or to become liable for any part of the indebtedness
evidenced by this Note, waive presentment for payment, demand, notice of nonpayment, notice
of dishonor; protest of any dishonor, notice of protest and protest of this Note; and all other
notices in connection with the delivery, acceptance, performance, default or enforcement of the
payment of this Note, and agree that their liability shall beunconditional-and without regard to
the liability of any other party and shall not be in any manner affected by any indulgence,
extension of time, renewal, waiver or modification granted or consented to by Payee. Maker and
each such endorser; surety, accommodation party and person liable or to become liable further
.consent to every extension of time, renewal, waiver or modification that may be granted by
Payee with respect to the payment or other provisions of this Note, and to the release of any
collateral given to secure the payment of amounts owing under this Note, with or without
substitution, and agree that. additional makers or endorsers may become parties to this Note-
without notice to Maker or any other parties and without affecting the liability of Maker or any
other parties under this Note.
2
7. Miscellaneous.
(a) Governing Law.. All questions with respect to the: construction of this
Note and the rights and liabilities of the parties to this Note shall be governed by the laws of the
State of California.
(b) Binding on Successors. This Note shall inure to the benefit of, and shall
be binding upon, the successors and assigns of each of the parties to this Note.
(c) Attorneys' Fees.
(i) Maker shall reimburse Payee for all reasonable attorneys' fees,
costs and expenses (including those of in-house counsel), incurred by Payee in connection with
the enforcement of Payee's rights under this Note and each of the other Loan Documents,
including, without limitation, reasonable attorneys' fees, costs and expenses fortrial, appellate
proceedings, out-of-court negotiations, workouts and settlements or for enforcement of rights
under any state or federal statute, including, without limitation, reasonable attorneys' fees, costs
and expenses incurred to protect Payee's security and attorneys'. fees, costs and expenses incurred
in bankruptcy and insolvency proceedings such. as (but not limited to) seeking relief from stay in
a bankruptcy proceeding. The term "expenses" means any expenses incurred by Payee in
connection with any of the out-of-court, or state, federal or bankruptcy proceedings referred to
above; including, without limitation, the fees and expenses of any appraisers, consultants and
expert witnesses retained or consulted by Payee in connection with any such proceeding.
(ii) Payee shall also be entitled to its attorneys' fees, costs and
expenses incurred in any post-judgment proceedings to collect and enforce the judgment. This
provision is separate and several and shall survive the merger of this Note into any judgment on
this Note.
(d) Entire Agreement. This Note and the other Loan Documents constitute
the entire agreement and understanding between and among the parties in respect of the subject
matter of such agreements and supersede all prior agreements and understandings with respect to
such subject matter, whether oral or written.
(e) Waivers. Waiver by Payee of any term, covenant or condition under this
Note or the other Loan Documents, or of any default by Maker under this Note or the other Loan
Documents, or any failure by Payee to insist-upon strict performance by Maker of any term,
covenant or condition contained in this Note or the other Loan Documents, shall be effective or
binding on Payee only if made in writing by Payee; no such waiver shall be implied from any
omission by Payee to take action with respect to any such term, covenant, condition or default.
No express written waiver by Payee of any term, covenant, condition or default shall affect any
other term, covenant, condition or default or cover any other time period-than the application of
any such term, covenant or condition to the matter as to which a waiver has been given or the
default or time period specified in .such express waiver. This Note may be amended only by an
instrument in writing signed by Maker and Payee.
3
(f) Severability. If any part of this Note is declared invalid for any reason,
such shall not affect the validity of the rest of the Note.. The other parts of this Note shall remain
in effect as if this Note had been executed without the invalid part. The parties declare that they
intend and desire that the remaining parts of this Note continue to be effective without any part
or parts that have been declared invalid.
8. Waiver of Trial by Jury. MAKER AND PAYEE WAIVE TRIAL BY JURY
WITH RESPECT TO ANY ACTION, CLAIM, SUIT OR PROCEEDING IN RESPECT
OF OR ARISING OUT OF THIS NOTE OR THE OTHER LOAN DOCUMENTS OR
THE CONDUCT OF THE RELATIONSHIP BETWEEN PAYEE AND MAKER.
.MAKER AND PAYEE HAVE OBTAINED THE ADVICE OF THEIR RESPECTIVE
LEGAL COUNSEL BEFORE SIGNING THIS NOTE AND ACKNOWLEDGE THAT
THEY VOLUNTARILY AGREED TO THIS WAIVER OF THEIR RIGHT TO A TRIAL
BY JURY WITH FULL KNOWLEDGE OF ITS SIGNIFICANCE AND LEGAL
CONSEQUENCE.
CITY OF VERNON,
a municipal corporation
By: ~~~,i~"a.c.~fiv
Name:Hilario Gonzales '
Title: Mayor
ATTEST:
f
City Clerk
Manuela Giron
APPROVED TO FORM:
Ci torn
Je A. H rison
4
, l
~ _
~ ~ , ( ~ ~ . ~ r
i JL~t ~ ,
,i ~
t`, u--
~ x t~
- - ,~~La', 1, t..~+~ l
4305 Santa Fe Avenue, Vernon, California 90058
Telephone (323) 583-8811
May 20, 2009
East west Bank
Attn: Ms.'F1ora Ling, Senior Vice President
135 N. Los Robles .Avenue,-Suite 600 '
Pasadena, CA 91101
Re: Loan Agreement.& Environmental Indemnity Agreement
Dear Ms. Ling: :
Transmitted herewith is a fully executed agreement as referenced
above, approved by City Council. on-May 18, 2009.., through '
Resolution No. 9962. -
If you have any .questions regarding this matter, please call
. Mr. Jeff Harrison at (323) 583-8811 ext. 173.
Very truly yours.,
Nell.y Giron
City Clerk
NG:km
c:, Rory Burnett
Sharon Duckworth
Masami Higa '
Joaquin Leon
Resolution No. 9962
Agreement File No, 09-080
E.~cCusiveCy IndustriaC '
' I ,
TICOR TITLE COMPANY
f;ECORCtATION REQUESTED L3Y: E5I29f2U
East west Bank
Loan Servicthg Department -
9309 Flalr Drive
EI Mont•, CA 91781" "2009D8D214T
WH£N RECORDED MAIL 70:
East West Bank
Loaa Service Department I
9300 Plelr Drive, 6th Floor
Et Monte, CA a173t
FOR RECORDER'S U E ONLY f
DEED OF TRUST '
THIS QEEd OF TRUST is :dated May 7, 2009, among the City of Vernon, A Body Corporate and Politic
("Trurtar"); East West Bank, whose address Is Loan Servicing Department, 9300 Flair Drive, EI Monte, CA
91731 (referred to below. sometimes as "Lender" and sometimes as "Beneficiary"); and EAST WEST
INVESTMENT INC., A CALIFORNIA CQRPORATI4N ,whose address is 9300 ,Flair Drive, eth Floor, EI Monte,
CA 91731 (referred to below as "Trustee").
CONVEYANCE AND GRANT: For valuable aonslderatien, Trustor rrfavacably grants, transfers and asslges to Trustee In trust, with power
of seta, for the benefit of Lander as Benefldary, all of Trustor's right, tlda, and interest In'and to thB following dascdbed real property,
togothpr with all existing ur subsequenty erected or aff~;red buildings, impmvements and fixtures; all easamenta, riyhts of way, and
appurtenances; all water, water rights and ditch Mgfits (Including stock in utilities with ditch or irrigation rights); and all other t1 hts, '
royalties, and profits relating to the real praparty,lncludmg without limitation all minarets, oil, gas, geothermal and similar mettere, the
"Real Property") incat®d in Los Angeles County, State of California:
See Exhibi# "p", which s attacht:d to this peed of Trust and made a-part at this peed of Trust as if fully
setfoAh hereto. -
The Real Property or its address Is commonly known as 4855 East 52nd Place, Vernon, CA 90058-5507.
The Assessor's pttrcfbl Number far the Real Property.: is 8314-019-900; ti314.02Z-900 and 6314-023-270,
Truster, prraeMly assigns to Lender (also known as t3aneflciary in this Daed o1 Trust) all of Truster's right, title, enrt Interest in and to all
present and future leases of the Pruperty and alt Rents from the Property. -This is en absoluto asslgnmont of Rents made In cunnec~ion .
with an abllgatlon secured kayreal propertypursuant to Callfomia Civil Code Section 2939. In:addilion, Trustor grants to Lender a Uniform
Commercial Cotle-security interest In;lhe F'ersonaf Properfy;attcl Ren)s ,
THIS DEED QF TRUST, tNCLUDINl3 THE A981DNMENT of RENTS pND THE SECI)RITV INTEREST IN THE RENTS AND PERSONAL
PRt]p~RTY, GIVEN TO SECURE (A) PAYMENT OF THE INDEfiITEDNESS AND- (a) RERFORMANCE QF ANY AND ALL OBLIt9ATIDNS
UNDER THE NOTE, THE RELATED DOCUMENTS, ANQ THIS DEED OF TRUST, THIS DEED-0F TRUST IS GIVEN AND ACCEPTED ON THE '
FOLLDYdIHG TERMS:
TRUSTOR'S REPRESENTATIDNS AND WARRANTIES. Truster warrants that: (a) this Deed of Trust is executed at Borrower's request and
not at the:request of Lender; (b) Trustor has the full power, right, and authority to enter Info this Uaed ofTn.ist and to hypothecate me
Property; (c} dre provisions of this Deed oFTrust do not conflict with, or ro3ult In a dotauR under any agreement or other instntment
binding upon Trustor and da not result in a vtotation of any law, regulations court decree ar order applicableio Trustor; (d) Trustor nos
esl?rbliahed adequate moaR9 Df obtaining from Borrower un a conthwing heals information about t7arrower's financial rondltlan; and (o} I
Lenderhas made no rapreaentation to Trustor about Borrower (Including without limitation the credltworthlness of Borrower). I
TRUSTOR'S WAtNER$. Except as prohibited 6y applicable law. Trustor waives shy right to require Lender to (a} make any presentment, I
pmtrrsr, demand, or notice of anyklnd, including notice of change of any terms of repayment of the Indebtedness, detArilt by Borrower or ,
any other guarantor or surety, day actlan ac nonaction taken by 8onower, Lander, or any ether guarantor or surety of t3orroweq or the
cTeelian of haw or additional Indebtedness;..{b) proceed agelhst any-person, including Borrower, before procaudluy aydiust Truster; (c) I
prnrar.~i against any collateral for the Indebtedness, including Borrower's collateral, before proceeding ar~sinat Tnralnr; (d) apply any I
payments or proceeds received against the Indebtedness In any order; {e) give notice of the terms, time, end place of any sale of any I
collateral pursuant to the Unifgrm Cammerraal Cnde nr any other Itlw governing such sale; (t) disclose any information about the
indebtetlneas, Borrower, any cotieterel, or any other guarantoror surety, or about any action or nonaction of .Lender; or {g) pursue any
remedy or course of action in Lender`s power whatsaevar.
Trustor also waives any end atl rights or defenses easing by raosgn of (h) any disablilly or other defense of Borrower, any other guarantor
or surety or any other person; (t) the cessation from any cause whatsoever, other than payment in full, oFthe Indebtedness; Q} Iha
appllCatlon of proceeds oFthe indebtedness by Borrower for purposes other than the purposes undrratnr>rf and Intended try Trustor and
Lender; (k) any sot of omission or cammission by Lander which directly or indirectly resuhs in or oontrlbutes to the discharge of Borrower
or any other. guarantor or surety, or the Indebtedness, ar Itie loss or release of any cwllateral.by operelian of law or otnerwiee; (q any
statute ai Ilmitetians In any. action under this Deed of Trust ar on the Indebtedness; or. ,(m) any rnadYficatlan or change in terms of the
Indebtedness, whatsoever, including without limitation, the renewal, extension, accelereticn, or other change in the time payment of the
..Indebtedness is due and any change In Ehe Interest rate.
fY
DEED QF TRUST
Loan No 29332 {Gontinued) page 2
Ttvstor walvas all dghis and. defenses arising aul of.an election of remedies by Lander, even khough that eleGion of remedies, such as
non-judicial .foreclosure with respect to security tar a guatanleed obligation, has destroyed Truator's fights of subrogation and
reimhursemanl agalnsLBarrower by the operation of 5dctlan 513tld of the Cellfomta Cada of Chdl Prbaeduro, ar otherwise.
Truster walvas sit rights and defenses that Truster may have because Borrower's cbligatlan is secured by real property. This means
among other things: (7) Lender may aolleat from Truster without first foreclosing on any real ar personal property cetlateml pledged by
Borrower. (2) If Lender foredosea on any real property collateral pledged by Borrower. AI The amount at Borrower's obhgatlon may be
reduced only by fhe price for which the collateral to sold at the foreeloaure eels, even If the collateral is Werth moro than the sale prlae. (B)
Lander may collect from Truster even If Lender, by foreclosing an the roal property collatereh hsa destroyed any fight Truator may have tv
collect from Borrower, This is an unconditional and irreva;able waiver of any rights and defenses Truster may have because Borrower's
obligation is secured by real property. These rightq and defames include, but ate not limited ta, any rights antl defansee Dosed upon
Section 5t30a. 513Ub, 580d, ar 728 of the Gods of Givil Procedure.
Truaicr understands and agrees that the foregoing waivers are unconditional and irrevocable waivers oT substanllve rights and defames to
which Truator might otherwise be entitled under slate and federal law. 11te rights and defenses waived indude, without llmllatlon, those
pravidetl 4y Galiforn~a laws of aurelyship and guaranty, anU-deNr;iency taws, and the Uniform Commercial Code. Trustdr acknowledges
that Truster has provided these waivers oT rights and defenses with 1ho Intention that they be fully relied upon by Lender, Truster further
' understands and egress that Ihis Deed of Trust is a separate and independent coniracl between Truster and Lender, given for full and
ample Ccatsideretlon, and Is enfarceahle on its own farms. Untrt all Indahfednass is paid iniull, Trustorwaives any right to enforce any
remedy Truster may have agzinat gnrrower's or any oNter guarantor, surety, or other person, and further, Truster waives any Hght to ~
participate in any collateral for thq tndabt„dness new ar hereafter hrgld by Lender. ~
' PAYMENT ANC' PERFORMANCE. Except es otherwise provided In this Oeed of Trust, 8arrower shell pay to lender aN Indebtedness
secured by this Deed of Trust as It becomes due, end borrower antl Truator shall perfartn all their respective obllgatlona-under the Mole,
this geed of Trust, and the Related Documents.
PO$SESSI~N AND MAINTENANCE. OF THE PROPERTY.. Harrower antl_Truator agree that Borrower's and TrustoYs pessessian end use of
the Property shall be governed by,the following provisions:
Poeeeeeien end Use. Until the accurrenca of an Eventof De}ault, Truster may (1} remain in' poasesaloh and control of the Property;
(2) uae,'operate ur manage the Property; and 13) oohed the Rents tram the Property.'
Oury to Malntaln, Truster shall maintain the Property in tenantahla condition and promptly perform all repairs, roplacemente, and
maintenance necessary to preserve Ns value. `
Compllantre With E?rviranmentai Laws. Trvstar represents and warrants to Lender That: outing the parted of Trvator's ownership
of the Propery, Ihera has bean rra uas, generation, manufacture, storage, treatment, disposal, release ar threatened release of any
Hazardous Substance by any person an, under, about or from the Propery; (2) Truster has no knowledge of, ar reason to beNava
that there has 4een, except as previously diaclusad to and aGcnvwledged by Lender in writing, (a) any brearfi or vlalakivn of any
Envirianmental Laws, (b) any use, generation, manufacture, etarage, treatment, disposal, release pr threatened release of any.
Hazardous Substance an, under, about or Tram the Property by any prior owners or occupantd of the Property, or (o) any actual or
threatened:litigation or claims of-any kind by any person relating to such matters;.and (3}, Except es previously disclosed to end
acknowledged by Candor !n writing, (a) Kellner Truster nor any tenant contractor,. agent or other suthadzed user of the Property
shall use, genrirale, rnanufadure, Store, treat, dispose of orreleaee any HaT~rdous Substance an, under, about or from the Praparty;
apd (ts) any such activity shall 6e oonducted;in compliance-with all aopliceole federal, state, and.lacal laws, reguladons and
ordinances, including without fimitelion all Envtronmenial Laws.. Truster authorizes Lender and .Its eyenlg to enter upon the Property
: to make such inspedlons and tests, at Trustar's expanse, as Lender may deem appropriate to determine compliance of the Property
wtih this section of the Dead`of-Trust Any fnspecNOna or tests made 6y sander shall. he for Lender's purposes only and shall net be
cdnatrued to create any respanslblllty or llablllty an the part of Lender to Truaiar or to any ether parson. The. repreaentatians end
warranties contalnod herein are based on Trustor's due dlllgence in Investigating the Property Tor Hazaidaua Substances. 7rusior
hereby. (1) releases and waiaes any futara claims against Lender for. indemnity or canhibutivn lrt the event Truster becomes Liable for
cleanup; or othecoosta under any- such lewa; and, (2) , agrees io Indemnify, defend, and hold harmless Lender agalnat any and all
daima, losses, Ilabililles, damages, penalties; and expenses which Lender may directly or indirectly sustain or suffer resulting tram a
breach oT-this section of the 0aed of Trust ar as a comequence oT any use, generation; manufacture, .storage, disposal, release or
threatened release occurring-prior to Ttustor's ownership w ihlereat In the Property, whether or oat the-same was ar should have
-been known to Truster The provisions of this section o[the peed of Trust,:induding the obligation to Indemnity and defend, shall
survive the payment of the Indebtedness and the satisfaction and raeonveyande of Elie lien of this Ooed of Trust and shall not be
affected. by Lender's acquisition of any interestin ihe'Property, whether by forecosuree ar otherwise.
Nuisance, Waste. Trustorshall not cause, conduct or pormitany nuisance nor commit, permit, ar suffer end sttlpping of ar waste on
or to the Property ar any portion of the Prgperty. Without limiting the generality of the fore:gaing, Tnrstor writ not remove, or grant to
any other .party the right to remove, any timber, minerata (including-oil .and. gee)', coal, clay, scarfs, soil; gravel ar rock products
without Lender's prior written consent.
Remavet of Improvements. Truster shelf not demolish or remove any improvements from.the (teal Property without Lender's prior
written crxraent As a condition to the removal of any Imprwr3ments, Lander may require Truster to make arrangsmanis satisfactory
to Lender to replace such Improvements with Improvements of atleaet equal value.
Lenders Right "iv Entpr. 'Lender and Lender's agents and repteeentativesroay enter upon the Real Property at alt reasonapla (imea to
attend to Lender's rntareats and to Inspect the Real Property for purposes of Trustor's compNance with fhb terms and conditions of
this Deed of Trust.
Compliance with r3oaernmental Requlromeats. Truster shall promptly comply with all laws: ardinancea, and regulations, now yr
hereafter In effect of all governmental authoritlea applica4le to the use or accupanoy of the Property, Including without.Ilmitatlan, the
Americans With Disabilities Act. Truster'may contest in good faith any such law, ordinance, ar reguiadon and withhold compliance
during any proceeding, including appropriate appeals, sa long as Truster has notined Lander In writing prior to doing so and so long as,
nEED OF TRUST ~ ,
Loan No: 29332 (C4ntinued) Page 3
in Lenders sole oplnicn, Lender's interests in the Property are not jeopardized. Lender may require Truster w post adequate seourHy
or a surety bond, reasonably satisfactory io Lender, to protect Lender's interest.
Culy to Protect. Truster agrees neither' to abandon orleave unattarrded the Property, Trustor shall do all other acts, in addition to
rheas acts set forth Shave in this sertlon, which Tmm the character and use of the Property am reasonably necessary to protect and
t7re5erve the Praperfy,
DUE DN BALE -.CONSENT BY LENDER, Lender may, at'Lender's option; declare immediately due antl peyebie all auma secured by this
Dead a} Trust upon the sale or transfer,: without Lender's prior written consent, of all or any part of the f2ea1 Property, q? any Inlereat in the
Real Property. A "sale or transfer" means the whveyance of Resl Property or any Nght, title or rnterest 1n the Real Property; whether Isgal,
benellclal or equitable; whathor voluntary ar involuntary; whether by ouMght Bale, deed, Installment sale contract, land contract, contract
for deed, leasahald interest with a term greater than three (3) years, ieaae-option contract, or by sale, assignment; or transfer of any
benelicial Interest in or to any land trust balding ilia to the Real Property, of by any other method of conveyance of en Interest in the Real '
Praperfy, If any Trustor is a corporation, partnership ar limited liability ccmpany, transfer-ales includes any change in ownership of mare ,
than twenty-five percent (2575) of the voting stACk, partnership interests or Hmiled liability company interests, as the case may be, of such
Trustor. However thla option shall rwt bs axerdsed by Lender If such exercise 1s pmhi6lted by applicable law.
TAXE9 ANO ilENS. The following provlsians relating to the faxes end Ilona oh,the Property are part of this Deed of Trust:
Payment, Trustor shall pay. when due (and In all events al least ten ,{10} daye prior to delinquency) all taxes, spedal texas,
aasessmenta, chargoa (Including ureter and sewer},-fines and Imposltinns levied against or on aoaaunfof the Property, and shall pay
when due all olefins for work dohs on ar for services rendered or material fumished to khe PropeAy. Truetor shall maintain the
Property free of all llerts having priority aver or equal to the interest of Lander under this need of Trust, except For the lien of taxes
and assessments rat due and except as otherwise provided in this Dead df Trish
Right to Qantest. "Tustor may withhold payment of any tax, assessment, or claim In. connection with egoad-faith dispute over the
obligatlan to pay, so long as Lender's interest In the Properly is not Jeopardized. If a lien arises or is filed as a result of nonpayment.
Trustor shall within fifteen (75) days afterthe fish arises or, if a lien is filed, within fifteen (95) days otter Trustor has notice of the
filing, secure the discharge of the lien, or H requested by Lender. deposit with Lender cash or a suffident corporate surety band ar
other aecuAty satisfactory to Lender In an amount suffident to dlacharge the lien plus any costs ahd attorneys' tees, or other charges
that could accrue as a result of a fareoicsure or sale under the Ilan. In any contest, TruaWr shall defend itself and Lender end shell
satisfy any adverse Judgment before enforcement against the Property. Trustor shall name Lander as an edditlonal obligee under any
surety band furnished in the content proceedings.
Evidence of Payment. Trustor shall upon demand furnish to Lender satisfactory evidence of payment of the taxes or assessments and
shall authorize the appropriate governmental official to deliver to lender at any time a written statement of the texas and assessments
against the Property.'.
i
NoAae of Construction. Trustor obeli notify Lender at leasf fifteen (i5) days before any work Is tommencad, any services are
furnished, pr any materials are supplied to the Property, if any mechanic's lien, rnatedalmen's Ilan; or other Ilea could be asserted on
account'of the work..servlces, or materiels and the cast exceeds 1000.. Trustor will upon request of lender fumish to Lender
`advance assurances setlsfaatary to Lender that Trusts' can and will pay the cyst of such Improvements.
PRgPERTY DAMACaE INSURANCE, Tha following provlslons relating fa Insuring the Property era's part of this Deed. of Trust.
_ Metntehenae of Irraurarroe: :Trustor hall • pracure• and melntein -policies .of fire .insurance with standard extended roverage
endorsements an a replacement basis for the full insurable value covering all Improvements on the Real Property In an omaunt
sufficient to avoid. application of any'cotnsurance douse, and with a standard mortgagee'dause In favor ei Lender Truster shall also
procure and maintain wmprehansive general liability Insurance In ouch coverage amounts as Lender-may .request with Trustee and
Lender being named as additional insureds In such liability Insurance poildes. Additionally.. TYUator shall maintain such other
Insurance. induding but. not limited to hazard, business Interruption, and fwllcr insurance„ qs Lendormay reasonably require.
Notwithstanding the foregoing, In no event shell Trustor be required to provide hazard Insurance in excess of the replacement value of
the Improvements an the Real Property. Policies shall be written in farm, amounts, coverages end balls reasonably acceptable to
Lender and issued by a company or companies reasonably acceptable to Lender. Trustor, upon-request of Lender, will deliver to
Lender from time to time the pollolea or certificates of insurance In form aatlafectory to Lander, including stipulations that coverages
will nqt be cancelled ar diminished without at least thirty {30) days prior written notice to Lender. Each insurance policy also shall
Include en endornembnt providing that mvarage in favor of Lender will not be .impaired In any way. by any. act, omission or default of
.Trustor qr any other parson. Should the Real t'raparty be located in en area designated by iha Qirealor of the Fedaro! Emergency
Management Agency as a apeolal flood hazard area, Trustor agrees to obtain antl maintain Federal Flood insurance, if available, within
45 days otter noocels given by Lender that the Property is located Ih a spedal flood hazard area; for the full unpaid princlpai 6alence
of the loan and any prior liehs an the property aewring the loan, up to the maximum policy IimMs set under the National Flood
Insurenoe Program, or as otharvutse requlrod by Lender, end to malntaln such Insurance for the term of the loan.
AppllceNon of ProcbWb, Trustor. shall promptly notify Lender of any loss ar damage'to the Property if the estimated cost of repair or
replacement exceeds 1000. Lender may make proof of loss If Trustor fails to do so within tift6en (i6) days of the casuahy. If in
Lender's solo Judgment"Lender's secuNty interest in the Property has been Impaired, Lender may, at Lender's election, receive end
retain the proceeds of any insurance antl apply .thee proceeds to the reduction of lhaindebtedness, payment of any lien affecting the
Property, or the restoration and repair of the Property, If the proceeds ere to be applied to restoration and repair, Trustor shall repair
or replace the damaged ar destroyed Improvements in a manner satlsfaelory to Lender. Lender shall, upon satisfactory proof of such
expenditure, pay or reimburse Trustor from the proceeds for the reasonably coat of repair or restoration if Trustor is not in default
under this Deed cf Trust. Any proceeds which have not bean disbursed within 180 days after their receipt antl which Lender has not
committed tD the repair or restoration pf the Property shall be used drat la pay any amount owing to Lender under this Deed of Trust,
then to pay accrued Interest, and the remainder, tf any, shall be applied to the pringpal balance of the ladebtedness, l(Lender holds
any proceeds after payment In full of the Indebtedness, such proceeds shall be paid to Truetor as Trusters Interests may appear.
Trustar's Report on Mauranoe. Upnn request of Lender, hnwever not mare Shan once a year, Trustor shall fumish lu Lenosr a report
DEED pF TRUST
Loan No: 2933 (Continued} Page 4
on each exiatine policy of insurance ahawing: (1) the name of the Insurer; the risks insured;. (3) the amount of the pdicy: (4}
the property insured, the then curtest replacement value of such property, and the manner of daterminirig that value; and (5) the
expiration date at the poUCy. Trustor shall, upon request of Lender, have an independent appraiser satlsfaatory to Lender determine
the cash value replacement cast of the Property.
TAX AND INSURANCE RESERVES. SubJect to Any Itrnitatlons set by applicable law, Lender may iaqutre Trustor to maintain whh Londor
reserves for paymen! of annual taxes, aasesamenis, and insurance premiums, which reserves shall be created by advance payment ar
monthly payments of a sum estimated by Lender to be sufflcieM to phoduce, amounts at least equal to the taxes, Ass~.asments, and
Inaurenoe premiums to be paid... Tha reserve: funds shall 6a held by Lender as a general deposit from Trualor, which tender may satisfy by
payment of the taxes, asseasrrrenls, and insurance premiums required to 6e paid by Truster as they become `due. Lender shalt have the
right to draw upon the reserve funtls ko pay such Items, and Lander shall not be raqulred to daterrnine the validity or accuracy of any item
liefare paying it. Nothing In. the Deed of Trust snail 6a oonsWed as roquMng Londor to advance other monies for such purposes, and
_ Lender shall net inbur any IlabNity for ahylhing it may door omit to do w11h respect to kha reserve aacounf. t3ubJeet to any limitations set
by appNcable law; if the reserve funds disGose a shortage ar deficiency, Trustor shall pay such ahartsiga ar deflolan+:y ea required by
Lender. Ali amounts In the reserve account are hereby pledged to further secure the Indebtedness, and Landeris hereby authorized to
withdraw aril-apply such amounts on the Indebtedness upan4he odaurrence of an Event of Default. Lender shell not 6e required to pay
any Interest dr earnings on the resarYe funds unless raqulred by law at agreed to by Lender In writing. Lender does not bald the reserve
funds In frost for Trustor, and Lender to not Trusocr's event for payment of the taxes and assessments raqulred to be paid by Trustor,
LENDEN'$ EXPENDITURES. If any aCtlan nr proceeding is Commenced that wculd materially affect Lender's interest In the Property or If
Trustor falls to aomplywith any prevision at this Deed of Trust arany Related Documents, Including but eat limited to Truatar's failure to
discharge or pay when due any zmaunte Trustor is required to discharge or pay under this heed of Trust or any Ftelatad ~oaumants, Lender
on Trustar's'behalf may {but shell not be obligated to}, take any action that Lender. deems appropriate,. including but not limited to
discharging or paying all saxes, (lens, security interests, encumbrances and tither claims, at any time levied or placed an the Properly and
paying all Costa for InsuNng, melntaining and preserving the Property. AIL such axpendituresYncurred or pall bylander for such purposes
wIN than bear Interest at the rate charged under the Note fromthe dale incurred or paid by Lender io the date of repayment by Trrratgr. All
such expenses will become a part of the Indebtedness end, at Lander'a optlon, will {A) tre payable on detrrand; (B} be added to the
balarlCe of the Nate and be epportlonad among and be payable with any installment paylrtents le become duff during either (1) the farm of
any applicable insurance. policy; or (2} the 7emaining harm of ere Note; or (C) ba. treated as a balloon payment which will be due and
payable at the Note's maturity. The Deed of Trust also will secure payment of these amounts. Suah right shall 6e In addltlon to ell other
rights and ramodloe to which Lender may ba entitled upon Default, ~
WARRANTY; DEFENSE OF 71TLE. The followmg,pravisions relating to ownership of the Property are a part of this Deed of Trust: ~
7lGs. Trustor wamanta that: (a) Truslgr holds goad. and marketable tikl5 of record to the Property in fee simple, Free and clear of ail.
(lens and encumbrances ether than those set forth in the Real Property descnplian or in any 11Ue Insurahoe policy, title repoA, ar final
lifts opinion issued in favor of, and accepted by, Lander in connection with this Dead of Trust, and {b) Trustier has kha lull rigfit,
power, and authority to execute and deliver this [feed of Trust to l,andar:
t]afsnea of Title. l3ubJect to the axoeptlon in kha paragraph shoos, Trustor-warrants -and will fare~er defend the title la the. Property
agalnstthe lawfulGaimR of all persona, In the event any action er proceeding Is oommeneed that questions Trustor's title or the
Interest of Trustee ar Lander under this Deed of Trust. Trustor shall defend the action et Trustor's expanse. Trustor may be the
nominal party In such proceeding, 6uk Lender shat) ba entiNed to participate in the proceeding end to be ropresenled in the proceeding
by counsel n1 .Lenders own choice, and Trustor will deliver,. or puss to bs delivered, to Lander such instruments as Lender may
request from time to lima to permit such parttrpation. ,
Campllanee Wlth Laws. Trustor warrants teat the Property and-Tl'ustor's use of the Property camplles with ail existing applicable
laws, ordinances, arrd regulations of guvemmantal authorities.
Survival of RaproaentaNena and Warranties. A11 representations, wamanlles;-and agreements made by Tru§tor In this Deed of Trust
sFtsll survive the exaouiion and d@lidury of this Deed of Trust,- shall be oontlnuing In mature, and shall remain in full force and effect
unlit euoh time as ftorrower's Indebtedness anal) be paid In full
CQNDBMNATIQM. Tha fallowing pravlaions relating kv aminent domain and inverse cundemnatfon prcaeedings are a part of this Dead of
Tnaat;
Proceedings: Ii any aminent domain ar irnarse caidemnailon praCeedinp is cemmenoed affecting kha Property, Truster shall promptly
notify Lender In writing, and Tnrstar shall promptly lake sut•.h steps as maybe necessaiy to pursue ar defend the anion and obtain the
award. Trustor may be the nominal party in any such proceeding, but Lender shall be entliled, at its alealion, to participate In Iha
proceeding and to be represahtsd in the proceeding by counsel of its own choice, and Trustor will deliver or cause to be delivered to
Lender such instruments and documentation as may be requested by Lender tram time to time to permtt such parllclpallon.
Applicaflon of Net Araceeds. if any award is made or settlement entered into in any condemnation proceedings aftecNng ell of any
part of the Propery or by any proceeding or purchase In Ifeu of condemnatlan, Lander may at its elenlon, end to the extant permitted
bylaw, require that all or any pa?4ien of the award Cr seRtlemenk ba applied to the Indebtedness and to the repayment of all reasanabla
costs, expenses, and attorneys' fees incurred by Trustee or Lender in cnrmedtinn with the eornfemnstion proceedings.
IMPC9ITION OF TAXES, FEES AM4 CHARDES 6Y GOVERNMENTAL AUTHORITIES..The following provisions misting to govemmsntat
taxes, #ees and charges are a partof ibis Qaed of Trust:
Current Texas, Fees and Charges. Upon request by Ldrxter, Trustor shalt tlxacvte such docunrunts in addition W ibis Dead of Trust
ant take whatever other action is requested by'Lendar to pertect and continue Lender's-lien an the Real Property. Trustor shall
reimburse Lander for all taxes, as described below, tcgethar with all expenses Incurred in recording, perfecting ar contlnuing this Deed
of Trust, including without limitation all taxes, teas, documentary stamps, and oU~ar charges for recording or registering this Dead of
Trust.
Torres. The fcNawing shall oonstltule taxes la which this seGion applies: (1) a specific tax upon this type of 4raed of Trust ar upon
DEED OF TRUST
Loan No: 29332 (Continued Page 5
ail rrr any part of the Indebtedness secured by tills Dead of Truel; (2J a spedfic tax tin Bortewer which Bartawer Is authorized ar
required to deduct from payments on the Indebtedness secured by this type of Dead of Trust', (3y a tax on this type of peed of Trust
vttargeable against the Lander or the holder. of the Note; ;and (4y a spaolfle tax on all or any. porBdn of the Indebtedness or an
payments of principal and. Interest made by Borrower.
Subsequent Texas. U arty tax to which this section applies Is ertactod subsequem to, the date of this Deed of firuat, this event shall
fiave the same effect as an Event of Default, and Lender may exercise any. or ail of ks available remedies for an Event of Default as I
provldod below unless 7rustnr either (f) pays the tax before It trenomea delinquivnt, or (2} contests the tax as provided above in the
Taxes and liens sectlan and deposits with Lender dash or a sufficient wrporate suretybrmd orother seounty satisfactory to Lender. I
SECURfTY AGREEMENT; FINANCING STATEMENTS. Ths.follnwing provraions relating 1o Yttls Deed of Trustee a security agreement area ~
part of Utis Dead of Trust:
Security Apresment Thls instrument shall aanedtute a Sacuriry Agreement to the extent any of the Property constitutes fixtures, and
Lender shall have ail of the rights aF a secured party under the,Unlform CommerciaLGode as amended from time to time.
Security IMiresL Upon request by Lender, Trustor shell take whatever action is requested by Lender to perfect end continue Landers
security interest In'the Rents and Personal Property. Trustor shall reimburse .Lander for all expenses Incurted In perfecting or
cantinuing this security Ihiereat. Upon default, Trustor shall not remove, saver ar detach the Persona! Preparty from the Property,
Upon default, Trustor shell assemble-any Pereonal Property not affixed to the Property in a mannor and at a ptaca roasanably
convenient to Tn,istor ann Lender and make it available to Lender within three (3i days after receipt of wrigen'demand cram Lander to
the extant permitted by applicable law.
Addressee. The mailing addresses of Tnlstor {debtor) and Lender (secured party) frrnn which Tnformedon corrceming the security
interest granted by this peed afTrust maybe obtained (each ae required by the Uniform Commercial Codal ere as stated an the first
page of Ibis Deetl of Trust.
FUiiTHER ABSUftANCE8; A7TtlRNEY-IN•FACT. Tha (onowing p~misione relating to further assurances and ettomgy-In-fadt are a part of
this Deed of Trust
Further Asauranaea. At any time, and Tram time to time, upon request of l.endar, Trustor will make, execulo and deliver, or will cause
to be made, executed or delvernd, ttl Lender or to Lender's designee, antl when requested by Lender, cause to be filed, rewrded,
rattled, or reredorded, as the case may be, al such times andln such offices and places as lender may deem appraprlete, any and all
such; mortgages, deeds of mist, security deeds, security agreements, financing statements, continuation statements, instruments al
furher assurance, aerd(Ieetes, and other documents as may; In the sole opinion of Lander, be necessary or desirable In enter to
effectuate, complete,pari'ect, continue, ar preserve (t) Borrower's and Trustar's obligations under the Nole, this Derx1 of Trust, and
the Raleted Documents, end (2) theJiens and security intererlfs created by this peed of Trust as ilrat and .prior liens on the Property,
whether new awned cchereafler eoquired,by Truster, Unless prohibited bylaw or Lender agreesta the contrary in writing, Trustor
shall reimburse Lender far all tests and expenses incurred In connectiomwith the matters referred m in this paragraph.
Attorney-in•Fact. If Trustor fags to do arr~+ o} the things referred to in the preceding paragraph, Lender may da so for and in rho name
of Trustor-and at Trustor's expense. For. surh purposes, 'fruetor hereby irrevocably appoints Lender as TrUStor's ettomeyIndact for
the purpose of making; executing; delivering, filing, recording, and doing all other things as may be necessary or desirable, In Lender's
sole apinton, tc accomplish the matters referred to In the preceding paragraph..
.FULL. PERFORMANCE. If Borrower. and Trustor. pay: all. iha ,Indebtedness-when due, and Trustor-athi3rwlse performs all the obligations '
imposed upnn Trustor under this Dead of Trust, Lander shall execute-and deliver to Trustee a request far 'full reconveyance and shall i
execuke and dAllver to Truster euikable statements of terminatlan of anyfinanofng'statemeni on file evidencing Lender's security Interest in
rile Rents end the. Personal Property. Lender may charge Trustor a reasonable reconveyance tae at the lime of redonveyanca.
EVENTS OF DEFAULT. Each of the (ollgwiny; at Lender"e wption, shall oonstilute an Event of Oefault under this Geed of Trust:
payment Default, Bortower-falls to make any payment when due under the Indebtedness.
Other pefaults. Aorrower or Trustor tails to comply. with orla perform any other term, obligation, covenantor wndliion oontainad in i
this Dead of Trust or in arty of the Related Documents or to anmply with ar to perform any term, obligation, covenant or cnndltion
contained in shy ether-agreement between Lender and Borrower or Trustor.
i
Compliance Default Failure to comply with any other term, abllgation, cevananl or oandltipn cpntainetl In this'Deea of Trust, the Nnte ~
' or in any or the Related Documents. i
Default on 4thar Paymmtc. Failure of Trustor within rho time required by this Deed of :Trust to make any payment for texas or
insurance, or any ether payment necessary to prevent flling Dior to effect discharge of any lien.
Qefault In Favor of Thlrcf partlgs_ 5hauld 13orrawer ai'any Grantor default under any loan, extension of crodlt, security agreement,
purohase or sales-agreement, or any other agreement, in favor of any other creditor or person that may materially affect any of
6crrowdr's or any Grantor's property ar borrower's ability to repay the lndebtetiness ar 6drrnwer's or Grantor's ability to perform their
respective obi Igations under this Deed a? Trost ar any n(tha Related Documents.
False 5tatsmvnts. Any wa?ranty, representagan or statement made or fumishad to Lander by Bdrrower,or Trustor or on Borrower's or
Trustnr's behalf under this Dead of Trust or the Related Documents is false. or misleading in uny material respect either new ar et the ~
Time made 6r fumishad or bacamos false or misloading at any time thenenftar.
flelestlve Collatanllsadon. This Deed of Trust or any ofithe Related Dadumehts ceases to be in full force and effect (Includiny failure
ai any collateral document to create a valid and perfected security interest or lien) at arty time and for any reason.
tnaeNaney. 7ha disseludcn ar termination of 9arrower's er Tntstor's existence as a going business, the insolvency of Borrowe? 4r
Trustor, the appointment of a receiver for any part of Borrower's or Trustor's property, any assignment for the benefit of creditors. ~
any type of greditor warluaut, ar the commencement of any proceeding under any bankruptcy or insolvency laws by or against ~
Borrower or Trustor.
I
1 ,
DEED C?F TRUST
Loan No: 29332 (Cantinued~ Page 6
Creditor or Forfailure Proceedings: ,Commencement of faredoaure or forfeiture proceedings, whelhor by Judicial proceeding, self-help,
repossession dr any. other method, by, any creditor of>Borrower or Truatar or by airy govammenlal agency against any property
sewnng the Indebtedness, This includes a gamiehmenl of any of Borrower's arTrustgr"s accounts, including deposit accounts, with
Lander. However, ibis Event of Default shall not apply If Chore Is a gtwd faith dispute by $orrovrer or TrUstar as to the validity or
roaeonablanes5 of the Balm which Is the 6asle of fhe creditor or igrfeiture proceeding and if Borrower or Trustor gives Lander written
notice of the creditor ar forfeiture proceeding and deposits with Lender monies ar a surety bond tar the creditor or forfeiture
proceeding, in en amount detellnlned by Lender, In Us solo dlsarotian, aS being an adequate reserve or bond for fhe disputo.
Broach of Other Agreement. Any breach by Borrower ar Trustor under the terms of any other agreement between Borrower or
Trustor artd Lender that !s not remedied wlthih any. grace period provided therein, Including without-limitatlon any agreement
conoeying any indebtedness or other obligedon of Borrower orTrustor to Lender, whether existlttg now or later..
Events Affecting Guerentor, Any qi the pregading events occurs with respect to shy guarantor, endorser, surety, or acaammodetion
- party of any of the Indebtedness or any guarentgr, endar6er, surety, or eccommodallon party dies ar becromes Incompetent, ar
revokes ar disputes thA validity of, ar Ilabllity under, any Guaranty of the lndebtednass.
Adverse Change. A material adverda change occurs in Banower's or Trustvr's finsnaal condition, ar Lander believes the prospect of
payment or performance of the Indebtedness }s impaired,
Rishk 10 lure. If any defauk, other than e, default in payment is curable and If Trustor has not been given a notice of a breach of the
same proVlelon of this Daad of Truerwithin the preceding twelve (1~} months; tt may be cured if Truster, after receiving written notice
from Lender demanding cure of such default: (1) Lures the default within fifteen (i5) daysj or (2} ' ifihe cure requires more than
tifiean {15) days; immediately initiates steps which Lender deems in Lender's sole discretion to be sufficient to cure the default and
thereafter continues and avrnplntes ell reasonable and necessary steps sufficient to produce curttpllance as soon as reasonably
preeticaL, .
RIQHTS ANp REME[IIES ON DEFAULT. If an Event of 4afautt occurs under this Dead of Truai, at any lima thereafter, Trustee or Lender
mayexerdae any one a~ more of the following rights and remedies: '
Eledlon of Remedies. Eiecllon by Lender to pursue any remedy shall not exclude pureult of any ether remedy, and an election to make
expenditdres ar tc take action to perform an dbligetlon bf Trustor under this Dead of Trust, attar Truotors falture to peHarm, shall net
afferct Lender's ?ight to declares default and exercise its remedies.
Foreclosure 6y Beale, Upon an Event of Default under this Deed of TnJSi, 6eneflclary may declare the entire Indebtedness secured by
this Deed of Trust immediately due and payabks by delivery to Tnlatee of written declaratlan of default and demand Mr sale and of
written ngtlce of default and of election to gauss to 6s sold 1ha Properly,. which nalice?ruslee shall cause 1o ba fled for retard,
Beneficiary also shall deposit wlth.Trustee this Deed of Trust, the Note; other dooumema requested by Trustee, and all docuntenks
evidencing expenditures encored fiereby. After the lapse of such tlrne as may then be required bylaw following the retardation of the
notice of`dafault, and notice of sale fiaving been given as then required by law, Trustee; without'demand on Trustor, shall sell the
Property eCthe time and place fixed by it in the natlca of sale,, either es a whole or in separate parcels, and in such order as it may ~
determine; at public auction tp the highasCbiddar for cash In lawful money of the United States, payable at time of sale,- Trustee may ,
postpone sale cf all ar any partlon of the Property' by public announpement at such ,time and place of sale; and from lima to time
thereafter mpy postpone such sale by public annauncemenl.af iha lime fixed,by the precedirrg postponement In accordance with
applicable law. Trustee shall deliver to'such purchaser ila dead conveying the Property so sold, but wilhqut any covenant or
warranty, express or implied, Tha recitals in such deed of any;matters ar foGs shall be conclusive proofbf the w[hfulness thereof.
:Any person, .including Truster, Trustee or Beneficiary may purchase at such sale. 'After deducting alt costs, fees and expenses a(
Trustee end o1 this Trust. inciuding cost of evidonoe of tltlo in ognnectlon with sale, :Trustee shall apply the proceeds of sale to
payment oL all sums expended under the terms hereai, oat then •epaid, wkh accrued interest al the' amount allowed by law in effect
aYthe date hereof; all other attrrrs than secured hereby;. and the remainder, if any, to the person or: persons Iegeliy entitled thereto.
JddlClal Foretijosura. With respect to all ar,any part of the Real Property, Lander shall have the. right in lieu of foreclosure by power of
solo to foreclose by judicial foreclosureln taoaartlance with and to the fullextent provided by Califomla law.
UCC Ramedbe. 'Wlfh respect to all or any part'of the Personal PropeNy, Lander shall have all the rights and remedies of a secured
- party under the Uniform Cammerclal Code, induding without Ilmltatlan the right td reco4er any deflclency in the manner and to the full
extent provided by Callfornla law. ~
i
Collect Rents. Lender shall have the right, wlthouk notice to Barrawer'or Trustor to take possession af'and manage ttis Property and i
collect tho Rents, including amounts past due and unpaid, and apply the net proceeds, over and above Lender's costs, against the
Indebtedness, In furtherance of thla rlpht, Lender maY require any tenant ar other ussrof the Property to make payments of rent or
use fees directly: to Lender.. 1# the Rents are collected by Lender, then- Trustor Inevocably deslgnales Lender as Ttustor's
atmmey-in-fact to ondarse inslrumehts reeelved in paymont thereof In the name of Trustor and to nagatiate tho soma and collect the
- proceeds. Payments by tenants dr ether users to Lander in response to Lender`s. demand shall satisfy the obli4atians far which the
payments are made, whether ar not any proper grounds for the demand existed. Lander may, exercise its rights under this
subparagraph either in person. by agent, or through,a recslvrir,
Appoint Receiver. Lendor shall have the right to have a receiver appointed to take possession of all or any pert ai the Property, with
4he power to protect and: preserve the Property, `ta operate the Properly prea:eding farsclaeure ar sale, and to collect the Rents from
the Property and apply the proeeeda over and above the-coal of the receivership, against the Indebtedness. The reaelver may serve
without band if permitted by law. Lendar"s right to thr~ appointment of a reaelvar shall exist whether or-not the apparent value cf the
Property exceeds the Jhdebtedness trya substanklal amount. Employment by Lender shall not disqualify a person from serving as a
reaelvar..
Tenancy at Sufferance, If Truetor,remalns in possessierr of the Property after the Propefly is sold as provided above or Lender
otherwise batomea entlUed to possession of the Property upon default of Bonower ar Trustor, Trustor aftall become a tenant at
.sufferance of Lender orthe purchaser of the Property end shall; at Lender's option; either (1) pay a reasonable rental for the use o1
the Property, or 12) vacate the Preparty immediately upon the demand of Lender.
[]EEp OF TRUST
Loan No; 29332 (Continued) Page 7.
Other :Remedies. Trustee or Lender shalt have any other right or remedy provided in this Dadtl of Trust or the Nate or available at law
or in equity.
Netiee of Sala. Lender shall give Trustor reasonable online of the time and place of any public sale of the Personal Properly or of Ihd
time after which any private sale or other Intended diapoeiilgn of the Personal Praparty Is to be made, Reasone6le notice shall mean
notice given et least tan (t0) days before the time of the sale or disposition. Anv gale of-the Personal Property may ba made in
cenjunctien with any sold of the Rdel Property.
Sale of the Properly. Ta the.exteni permitted by applicable law, Borrower and Trustor hereby waives any and all rights to have the
Property marshalled. In exercising Its rights and rernedlea, the Trusted at Lender shell bd free to dell all or any part of the Property
together or separately, In one sale or by separate sales. Lender shall. be entitled to bid ai any public sale gn.atl or any portion of the
Property:
Attorneys' Foes; F.xpaotes. H Lender instltulea any suit ar action to enforce any of the terms oT this Deed of Trust, Lander shall be
entitled to recover suoh sum as the court may adJudge reasonable as attomeys' fees at trial and upon any appeal, Whether or not any
cdurCaation is involved, and to the extent not prohlttlted by law, all reasonable expanses Fender incurs that In Lender's opinion are
neCeSSary at soy Nme for the protection of its interest or the enforcement of its rights shall become a part of the Indebtedness payable
on demand and shall bear Interest et the Naie rate from the date of the expenditure until ropald. Expenses covered by this paragraph
Include, wtlhaut limitation, howevrr subject to any limits under applicable law, Lender's attorneys' Foes and Lender's Isget expanses,
whether or not there Is a lawault, inctudiag attamdys' idea and expenses for bankruptcy proceedings (Including efforts to modify or
vacate any automate stay or injunction), appeals, and any anticipated post
judgment cdleciion services, the cost of searching
records, obtaining title reports (Including-foredoaure reports), surveyors' reports, and appraisal fees, title Insurance, and fees for the
Trustee, to tha_ extent permitted by applicable law. Trustor also will pay any court posts, in addition to all other sums provided by
law. ,
Rights- of Trustee. Trusted shall have all of the rights and duties of Leader as se( forth in this sdcticn.
POWERS ANU,gSLIC+ATIONS OF TRtfSTEE The-fnliawing provlsiens relating to the powers and obligations of Trustee are pert of this
Deed oT Trust:
Powers of Trustee. In addiven to all powers of Trustee arising as a malteraf Iew, Trustee shall have-the power to take the following
actlans with respect b the Property upon the written request of Lender and Trustor. (a) jdn In preparing end tiling a map or plat of
fhe Real Property, including the dedication of streets or other rights to this public; (b) join'In :grentirx~ any easement ar creating any
restrlation on the Real property; and (a) join in any.subonilnallon or other agreementaffeCting this Dodd of Trust or the Interest of
Lender under this fad of Trust.
Olrllgatlans to Notify. Trustee shall net be ob8gated to notiFy any other party aF a pending sale under any other trust dead or lien, or
of Any action ar prooeeding, m which Trustor, Lender, or Trustee shall ba a party, uhless'the action or proceeding is brought by
Trustee.
7rustaa, Trustee shall meat-ell qualiflcatlons required for Trustee under applicable law. In addition to the rights and remedies set
forth above, with respect to all or any part of the Property, the Trustee shall have the right to foreclose by notice and Bald, and Lender
shall have the righ# to foreelesd by judicial forerlesure, In either ease in accordance with and to the full extent provided by applicable
law,
Buaeesaor,,Trusiee.. lender, at Lgnder'g,npllen,.may #rom time to hrne appoint a successor Trustee to` any Trustee appointed under
Ihid Deed of Trust ny an instrument executed and acknowledged by Lender and retarded In the oTflce of the recorder of Los Angeles
County, State of CaUfornia. The instrument shall contain, In addition to all other mallets required by state law, the names of the
original Lander, Trustee, and Truster, lha-book and page where this Geed of Trust is reaerded, and the namo and address of the
successor trusted, and the instrurnenf shall be executed sect aclcnowladged by Lender or Its successa?s in Interest. Tha succx~asor
trustee, without coavayancd of the Property, Shall succeed to elf fhe tftle, power, end duties rwnfetred upon. the Trustee In tliis Deed
of Trust end by applicable law. This procedure for'substitupoa of Trustee shall govern to the exclusion of all other provialone for
substitution.
Acceptanos. toy Trustee. Trustee accepts this Trust when this Deed of Trust, duly executed and .acknowledged. is made a public
record es provided by law.
NOTICES, .Any notice required to be given under this Deed of Trustshall be given Irrwriting, and shall ba efYective when actually delivered,
when actually received by telefacslmtle (unless othenvlsa required by Isw), when deposited with a nationally recognized avemight couder,
or, n mailed, when deposited in the United States mall, as First class, certified or registered mail poalege prepaid,. directed to the addresses
shown nderthe beginning aT tFils Deed of Trust. Truster requests that copies of any notices of dafaultand sale be diroeted io TrustaYa
address shown near iha beginning of this Deed of Trust. Ail copies of notices of foradosure Irom the holder aT any Iidn which Itas priatiry
aver this Deed of Trust shall be sent to Lender's address, as shown near the beginning pf thrs Daed of Trust. -Any party may change its
address for notices under his Dead oT Trust by giving iannal written notlae to the other parties, spadlFying that the purpose of the online is
Oo change the party's address.. For notlce .purposes, Trustor agrees to keep Lender informed at ell limas of Trustor's current address, I
Unless otherwise provided or required by law, li there is more than one Trustor;' any notion given by Lender to any 7nrafar is deemed to 6e
rrolice given to all?rustgrs,
STATEMENT OF OBLIGATION FEE, Louder may cdloct a Fee, not to oxcood the maximum amount permitted by law, for furnishing the
statement of obligalian as provided by 8ectian 2943 of the Civil Code of California.
MI9CELLANEOU13 PROV1810N5. The Pollowin$ miscellaneous provisions are a part of Ihts Owed of Trust:
Amendmerrts. This Daad of Trust, together with any Related Documents, constitutes the entire understanding and agreemont of the
parties as to the matters eel forth in this Dead of Trust. Nd alterodon of or amendment to this Daed of Trust shell ba effective unless
,given In writing and signed by the. party or parties sought to be charged or bound by the altaratron or amendment.
Annual. Raparts. If the Property is used for purposes other then Trustors resldenee, Trustor shall furnish to Lander, upon request, a
QEED OF TRUST
Loan No; x9.aaa (Continued) page s
certified atatemenl of net operating,income received from the Properly during Trustor's previous floral year fn such form and detail as ~
Lender shall require, "Net dparating Income" shall mean all cash receipts from the property leas all cash expenditures made in
connection with the operation of the Property,
Caption tteadinge. Caption headings in this Deed oP Trust are for odtvenience purposes only and are dot to be used W interpret or
ri®fine the provisions of this Deed of Trust.
Merger, There shall be no merger of the interest or estate on:ated by this i)eed pf Trust with any other inleresk a estate in the
Property a! any time held by or for the benefit of Lender In any aapaciiy, without the written consent of Lender
Governing taw, This Daed of Trust will be ggvemed by federal law appllca4le to Lender and, to pre gxturtt not preempted by federal
law, the'larra of the State of Galifomla'wlthout regard to iks'conNlcte of law pmvlslona. Thla Dttad of Trust has been aaceptad by
Lender In the Stare of Caltfnrnla.
Joint and Several Liability. AIt ohllgations of Borrower and Trustor under this Deed of Trust shall be Joint and several, and all
references to Trustor shalE mean each and' every Trustor, and all refefrjnces to Borrower shall .mean each and every Borrower. This
means that each Trustor signing below is responsible for allobligatlons in this peed of Trust. Where any one or more of the parties is
a corporation; partnership, limited liabili(y company or similar eality, !t is net necessary for Lender to inquire into the powers of any of
the ofNCers, directors, partners, members, dr other agents acting or purposing to art nn the entlty's behalf, and any obtlgations made
or created in reliance upon the profesae~J exerClue of sugh powers shell tx+ guaranteed under this heed of Trust.
No Waiver by Lander. tender shat! oaths deemed to have waived any dghts under this Deed of Trust unless such waiver is given in
writing and signed. by Lender, No delay or omisalan on the part of:Lender in exergising any right shall operate a8 a waiver of such
.right ar any other rlpht, A waiver by fonder of a provlsidn of this Deed of Trust-shall not prejudice or constitute a waiver of Lender's
right otherwise fo demand strict eomplience with that provision or any other prevision- of this Owed of Trust. Na prior waiver by
Lender, oar any rouree of dealing between Lander end 7"rostor, shall constitute a waiver of any of Landers rights or crf any of
Trustor"a oMigallons as iq any future traneacticns:` Wheneva~ the carrsant bf Lander ra required under This-Deed of Trust, the grenllhg
of such egnsent by Lender in any instance shall not ognstitute cqn&nuing consent io subsequent Mstanc8s where suolt consent Is
required and In all cases such consent may ba granted cr withheld in the sole discretion of Lender.
Severahlllty. If a.cquti of cgmpetentjurlsdicfion finds any provlalon of this [}earl of Trustto 6e illegal; Invalid,"or unenforceable as to
any circumstance, that linding shall rwt makeaha offending provision Illegal, Invalid. or unenforceable es to any other ciroumstance. If
feasible, the gffending prevision shall be eansldered modlfled so than it becomes -legs ; valid and enforceable, If-the pffending
provislod cannot. ba so modUied, it shall be oensldered deleted from this Deed of Trust. Unless otherwise required by law, the
illegality, invaUdity, or unenlorceability of any provision of this Deed el Trust shall not affect lheiegality,'~alidity or enfarceablllty of
- any other provision of thla Dead of Trust.
Succassora and Assigns, $trbject 4o any limitations stated In this Deeii of Trust on transfer of Truslor's Interest, this Qeed of Trust
shall be binding upon and Inure to the benefit of the parties, their auooossors and assigns. If ownership. of the Pr+oparty becomes
vested in a parson other than Trustor, Lender, without notice to Trustor, may deal w1Ur Truslor's successors with reference to this
-Dodd of Trust and the indebtednrrss 6y wasy of for•bearence or extension without. releasing Trustor from the obligations of this Deed of i
.Trustor Ilablllly under the Indebtedness.
Time is of the Eaaenwi. Timo is of the essence In the performance of this Oesd of Tn,ist.
. Waive Jury. To the extent permlttsd by applica4le law, sit parties to-this Osad of Trust hereby waive the right to any jury trial In any
nation, proooading, or counterclaim brought by any party against any gthe? party.
DEFINITIONS. The following rapiisslrzed vmrds and terms shall hiavri the following meanings when used in this Deed of Trust. Unless
specifit~lly stated to the contraryr all references to dollar amounts shall moan amquntsln lavrful money of the United States of Amerir~.
Words anrf terms used In the singular ahaR include the plural, and the plural shall Include the singular, as the context stay reyuUe, Words
and terms not olherwiae dt3tined'in this Decd of Trust shall have the meanings aitrlbuted to such terms in Ute Uniform Commergial Code;
Bedstidary, The word "8nnefiotary" means East West F3ank, and its successors and assigns,.
Borrower. The.word "Borrower" means City: of VerrioiL a MunicipaLCorporaGun anti inviudea all co-signers and co-makers signing the
Note and all their successors and assigns.
-Deed of Trust. The words "Deed of Trust".mean this Deed of Trust among Trustor, Lender, and Trustee, and includes without
Ilmifation all assignmaht and security interest previsinna relatlng to the. Personal Property and Rents:
Default. The word. default" means ttie Default set Porth in this Deed of Trust in the section titled "Default".
Enviranniantal Laws, The words "~nvironrnental laws" mean any and all store, federal and ier~l statutes, recUulations and ordinances '
irlating to the protedlan of human health ar the environment, including without Ilmitatlon the Comprehensive Fnviranmental
Response,. Campensatrgn, altd Liability Act o1 1880, es amended, 42 U.S.C, Section- ~CiS)1, et seq. ("CERGLA"), the Supetiund
Amendments and Reauthgrtsatlon Aot of 1 g86, Pub. L, No, g0-499 {"SARA"), the Hazardous Ma#eriala Tranapartatlon Act, 48 U.S.C.
Section 1801, et sag:, the-Resource Conservation antl Recovery Act, 42 U.S:C- Section 139D1, et seq., Chapters 8.5 through 7.7 of
Division 2A of the CelNomla Health and Safety Code, Section 25100, et seq„ er other applicable state or federal laws, rules, nr
regule4ons adopted pursuant thereto.
Event of Default. The words "Event of Default" tneen any of the events of default eel forth in this Doed of Trust in the events of
default section of thla Deed of Trust. '
Guaranty. The word "Oueranty" means the guaranty from guarantor, endorser, surety, or accommodallon party 1a Lender, Including
without IlmRation a guaranty of all or part of the Note. .
Hazardous Substances. The words "Hazardous Substances' mean materials that, 6eaeusa of their quantity, Cgrlceht?ffiInn or
phyalgW, chemical or infechcus charecterislics, may roues or pose a present or potential hazard to human health w the environment
when improperly used, treated, stored, disposed' of, generated, manufactured, transported or otherwise handled. The words
DEED OF TRUST I ~1
Loan No: 29332 (C4ntittuedj pang g f ~f ~
"Hazardous Substances" ere used in their vey broadest sense antl indude without limltation any antl all hazardous or toxic
substances, materials of waste as :defined by or Ilsted tmdet the Environmental Laws. The term "Hazardous Substances" also
includes, wghout limitation, petroleum end petroleum by-products ar any fraction thereof and asbestea.
improvements, The word "Improvements"-means all existing antl future improvements. bullaings, structures, mobile homes affixed on
the Raal Property, facilities, additions, replacements and other construction on the Real Properly.
Ihdabtednosa. The word "Indebtednese" means all principal, IhteresL and other omouMS, costs and expsnaos payable under the Note
or Related Documents, iggether with all renewals vf, extensions vi, modifications. vf, consolidallons of and substitutions for the Nota
or Related l)gcumonts and any amounts oxpendatl or advanced by t.onder to discharge Trvsta^a obligstians or expenses incurred by
Trustee or Lender to enforce Trustar's obligaiiona under this lamed of Trust, together with interest on such amounts as provided In this
Dead of Trust:
Lendac Ths word "Lander"-means Eest West Bank, its successors and assigns.
Nate.. The word 'Note" moons the promissory. note doted May 2oD9, in the original principal amount of
~6,370,U00:00 from Bomawer to Lender, together with all renewals a?,' extensions of, mvdificetigns af, refinancings of,
cam9olldaUans of, and suhstitutivns inr the pmmissdry ogre ar agreement. NOTICE T4 TRU5TOR; .THE NOTE CONTAINS A
VARIA6LE INTEREST RATE,
Personal property. TMe words "AOrsonal Property" mean oil equlpman4 nxturos, and oihar articles vf. poraonel propgrty now or i
hereafter awned by Truster, and new ar hereafter attached ar affixed to the Real Property; together with all accesaians, parts, and
additions to, ell replacements of, and sll substititutiona for, any of such property; end together with all proceeds (inGuding without
limitation all insurance prggseds ahd refunds of premiums) from any sale or other dispasitien of the Properly,
properly. The word "Property" means collectively the Real Property end the Personal Property.
Rest Properly. The wards "Real Property" mean the real property, interests and rights, as further described In this deed qt Trust.
Related'Doeumenta. The words-"Related Documents" mean all promissory notes, credit agreements, loan agreamertts, security
agreements, martgacdPs, deeds of toter; Serudty deeds, collateral mortgages, and ell other instruments, agreements and dnnrmenis,
whether now qr hereafter existing,'executed In ggnnection with the Indebtedness; olfcept that the words do not mean any guaranty or
environmenkal agreomeM, whether-new yr hereafter existing,' executed in connection with the Indebtedness.
Rants. The word-"Rents" means all present and future leases, rents, revenues, Income, Issues, royalties, profits, and other benefits
derived from the Property together with the cash proceeds of the Rents.
Trustee. The word "Trustee" means EAST WEST INVESTMEIJT ING., A CALIFORNIA GORPDRATION ,whose address is 9380 Flair
?rive, 6th Floor, Ef Monte, CA 91731 and any substitute ar successor trustees.
Trustor. The word "Trustor" means City of Vemon, A body Corporate And Politic.
TRUSTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS DEED OF TRUST, AMD TRUS70R AGREES TO i7S TERMS,
INCLUDING THE VARIABLE RATE PROV19101J5 OF THlS NOTE SECURED BY THIS DEED OF TRUST.
TRU9TOR:
CRY~IOgS/F/ VERNON, A BODY CgRPORATE AND POLRfC
Sy, Hlla onsalesoff Veman, A Body Corporate Antl poll[to
I
.DEEP IQF TRUST
Loan No: 28SS2 (Cotltlnued) Page 1D
,
{ i
CERTIFICATE OF ACKNOWLEDGMENT- '
rte/'
STATE OF ~,.~/r' {~c~'~^ 7
) 98
.COUNTY OF ~S .~fPC' )
On µv? ~'i~ . 20~ before me. ~d.~~~~ S! ~1~d lit / 1f ~ ~l`~uf ! i
(here insert name and till • of the officer) G ~
personally: appeared Hllarlo Gorualea, who proved to mo on the basis of satisfactory evidence tv be the person(ej whose name(s,} islaw
' subscribed to the within instrument and acknowledged to me hat he/spellpey executed the same in hlslhesAHeir authorized capecity(iac),
and that by hIslhgrkhelr signatu~e~ on, the instrument the person(s), or the entity upon behalf of which the person(a) acted, executed the
Instrument.
Lcertlty under PENALTY OF PERJl1RY under the laws of the State of Califomla that the foregoing paragraph is true end cgbeGt.
iNITNESS my hand and gtflalal scat, tv1ANUELgG~IRl7N~~
Cammissian # 1i b11 ~6B f
~ ~ ,Notary Public - Coli~omia
Signature r • Lob AngFik~ Gaunty
' My nlnm Sxt•i:es Mou 4,?QU9~ {9eaq
-~+..---~r.~rY
(DO NOt RECORD}
REQUEST'FOR -FULL. RECONVEYANCE
(Tq be used only vvher gbligatigns have-been paid iri' full)
To: ,Trustee
The undersigned Is the legal owner end holder of all Indebtedness sawred by this Geed of 7rusL All sums secured by This Oesd of Trust
have been fully paid and satisfied. You are hereby directed, upon payment to you of any sums awing M ynu under the terms of this Deed
of Trust or pursuant to any applicable statute, to cancel the Note sawred by this Deed of Trust (which is delivered to you together with
this Doetl of Trust), entl to reconvey, withouCVrarranty, to the parties desiflnated by thw terms of this Qestl of Trust, the estate now held
by yuu under this Deed of Trust. Please mail the reconveyance and Related Documents tq;
Dale: l3eneflciary:
ey;
na:
LASER PRO Lending, Ver. 5.44.00.002 Copr. Harland Financial Solutions, Inc. 1997, 2t]09. All Rights Reserved. - CA
G;IAPPSIEWBCF11CF11LPL1GD1.FG TR 9143 PR•1
I
PRELIMINARY REPORT TiaorTide Company
ORDER NO.: 9790315-72
:LEGAL, DESCRIPTION
EXHIBIT "A"
THE LAND REFERREp° TO HEREIN BELOW IS STTUATEp IN TH6 COUNTY OF L05 ANGELES, STATE DF
CALIFORNIA, AND iS DESCRIBED AS FOLLOWS;
PARCEL i t l
THOSE PORTIONS DF LOTS 1D5, 106 AND 107 DF TRACT NO. 792.3, PARTLY IN THE C[TY OF MAYWDDp AND
PARTLY TN THE CITY DF VERNON, ALL IN THE COUNTY OF LDS ANGELES, STATE DF CAL,IFDRNIA, AS PER MAP
RECORDED IN BOOK 113, PAGES 80 TO 83 INCLUSNE OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER
. OF SAID COUNTY, DESCRIBED AS FOLLOWS: '
BEGINNING AT THE INTERSECTION OF THE NORTHWEST LINE OF SAID LOT 107 WITH THE SOUTHEASTERLY
PROLONGATION' OF THE NORTHFJIST LINE OF 52ND PLACE, 50 FEE'T' WIDE, EXTENDING NORTHWESTERLY ,
FROM HELIOTROPE AVENUE, AS SAID STREETS ARE SHOWN ON SAID TRACT 7923, THENCE.NORTH 33° 21'
00" EAST ALONG THE NORTHWESTERLY LINE OF SAID LOT 107,,4 DISTANCE OF 394.65 FEET TD THE MOST
NORTHERLY CORNER THEREOF; THENCE SOUTH 54° 27' 40" EAST ALONG TTiE NORTHEASTERLY LINE DF SAID
LOT 107, A DISTANCE OF 134.17 FEET TD THE BEGINNING OF A TANGENT CURVE THERRN, CONCAVE
SOUTHWESTERLY AND HAV]NG A RADIUS OF 455.30 FEET; THENCE SOUTHEASTERLY ALONG SAID CURVE
THROUGH A CENTRAL ANGLE OF 15° 26' 15", AN ARC DISTANCE OF 122.67 FEET; THENCE TANGENT TD SAID
CURVE SOUTH 39° Ol' 25" EAST ALONG THE NORTHEASTERLY LINES OF SAID" LOTS ;305, 106 AND 107, A
DISTANCE OF 517.25 FEET TO THE MOST EASTERLY CORNER DF SAID LOT 105; THENCE SOUTH 5L° OQ' 14"
WEST ALONG THE SOUTFiEAST'ERLY UNE OF SAID LOT 105, i4 DISTANCE OF 457.22 FEET TD A-POINT IN THE
NORTHEASTERLY LINE OF THAT CERTAIN PARCEL OF LAND DESCRIBED3 AS PARCEL"6" IN THE DEED TO CITY
OF MAYWOOd RECORDED MARCH 2Q, 1542 .IN BOOK 19198 AT PAGE 193 OF 5AIp .OFFICIAL RECORDS;
THENCE NORTH 38° 59'50" WEST ALONG SAID LAST MENTIONED NORTHEASTERLY LINE TO NORTHEASTERLY
LINE OF THAT CERTAIN PARCEL OF LAND DESCRIBED AS PARCEL "A" IN THE. DEED Tfl CIfY OF MAYWDOD
RECORDED AS DOCUMENT N0. 1 OF AUGUST 20, 1940 IN BOOK 1750 AT-PAGE. 183, THE NORTHEASTERLY
L1NE'OF T}iAT CERTAIN PARCEL OF LAND. DESCRIBED IN THE DI:£D TU MAYWOOD MUTUAL WATER COMPANY
NO. 3, RECORDED IN BOOK- 47$7 AT PAGE 4, AND THE NORTHEASTERLY LIiVE OF PARCEL "C" OF SAID DEED
RECORDED IN #300K 19198 AT PAGE 193, ALL OF SAID OFFICIAL RECORDS, 5b4.07 fiEET; THENCE ALONG A
NORTHERLY LSNE' OF HEREINABOVE DESCRIBED PARCEL "C", NORTH 82° 4T 35" WEST 63.04 FEET TO THE
EASTERLY LINE OF HELIOTROPE AVENUE, 50 FEET -WIDE, AS -SHOWN ON SA[D MAP OF TRACT NQ. 7923;
. THENCE ALONG SAID EASTERLY STREET LINE NORTH 7° 33':.00"..EAST 33.88 FEET, TO, A, N,.;ANGLE PRINT
THEREIN,' THENCE CONTINUING. ALONG A SOUTHEASTERLY LINE OF SAID HELIOTROPE AVENUE, NORTH 33°
21' 00" EAST 50A2 FEET TO THE POINT OF BEGINNING.
IXCEPT ALL OIL, GA5 ANb OTHER`PETROLEUM AND MINERAL SUBSTANCES, ,BUT WITHOUT THE R]GHT OF
SURFACE ENTRY AS RESERVED 7N BOOK 20565 PAGE 1, OFFICIAL RECORDS,-FROM THAT PORTION OF SAID
LAND INCLUDED WITHIN THOSE PORTIONS OF LOT'S 105, 106 AND 1D7 OF TRACT NO. 7923, IN THE CITY OF
MAYWOOD, COUNTY OF LOS ANGELES, STATE OF CALIFORNIAN AS PER MAP RECI?RpED IN BOOK 113 PAGES
80 7O 83 OF MAPS, III THE OFFICE OF THE COUNTY RECORDER OF SAID. COUNTY, MARE PARTICULARLY '
DESCRIBED AS FOLLOWS:
BEGINNING AT THE MOST WESTERLY CORNER OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE DEED
TO MAYWOOD GLASS CO., RE~COItDED A5 DOCUMENT NO. 2443 ON APRIL 10, 1952 IN BOOK 38681 AT PAGE
218 OF OFFICIAL RECORDS, IN THE gFFICE OFSAIQ COUNTY RECORDER, WHICH MOST WESTERLY CORNER
IS A POINT IN THE SOUTHEASTERLY PRQLONGATTON OF THE NORTHF-ASTERI.Y UNE DF FIFTY-SECOND PLACE
AS SHOWN ON SAID MAP OF TRACT NO. 7923, THENCE ALONG A SOUTHWESTERLY UNE OF SAID MAYWOOD
GLASS PROPERTY AND SAID PROLONGATION SOUTH 54° 27' 15" EAST 8D.12 FEEI- TD AN-ANGLE PRINT ]N
SAID SOUTHWESTERLY LINE; THENCE CCINTINUING'ALONG SAID SOUTHWESTERLY UNE AND ALONG THE
SOUTHWESTERLY LINE OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE DEED TO MAYWOOD GLASS
CO., RECORDED AS DOCUMENT N0. 253 OF NOVEMBER 3, 1938 IN BOOK 16177 AT PAGE 21& OF -SAID
OFFICIAL RECORDS,- SOUTH 38° 59' 30" EAST S70 5 FEET TO THE END THEREOF; THENCE ALONG THE
SOUTHWESTERLY PROLONGAT]ON DF THE 50UTHEASTERIY UNE OF SAIp LAST MENTIONED PARCEL, SOUTH
51° 00' 30" WEST 50.00 FEET TD A POINT IN THE NORTHEASTERLY LINE DF THAT CERTAIN PARCEL OF LAND
DESCRIBED AS PARCirL "8" IN THE DEED Tti1 Ci'fY OF MAYWOOD RECORDED MARCH 20, 1942 IN BOQK 19198
AT PAGE 193 OF SAID OFF]CLAL RECORDS; THENCE NORTH 38° 59' 3D" WEST ALONG SAID LAST MENTIONED
NORTHEASTERLY LINE, TO NORTHEASTERLY LINE OF THAT CERTAIN PARCEL OF LAND DESCRIBED AS PARCEL
"A" IN THE DEED TO CITY qF MAYWOOp RECORDED AS DOCUMENT N0. 1 DF AUGUSf 20, 194D IN BOOK
3 CLTA Preliminary Report Form -Modified (11-17-06)
y
PRELIMINARY REPORT Ticor Title Company
ORDER NO.: 9790315-7z ' ~j
LEf°1AL DE5CRTPTItTN
EXWIBTT "A" (CGNTTNUEp)
17750 AT PAGE 183, THE NORTHEASTERLY LINE OF THAT CERTAIN PARCEL OF LAND DESCRIBED [N DEED TO
MAYWOOC~ MUTUAL WATER COMPANY NO. 3 RECORDED iN BOOK 4787 AT PAGE 9 AND THE NORTHEASTERLY
LINE OF PARCEL "C" OF SAID DEED RECORDED IN BOOK 19198 AT PAGE 193, ALL OF SAID OFFICIAL
RECORDS, 5b4.07 FEET, THENCE ALONG A NORTHERLY LINE OF HEREINABOVE DESCRIBED PARCEL "C", j
NORTH t3Z° 47' 15" WEST 63.04 FEET TO THE EASTERLY LINE OF HELIOTROPE AVENUE, 50 FEET WIDE, AS
SHOWN ON SAID MAP OF TRACC NO. 7923; THENCE ALONG-.SAID EASTERLY STREET LINE NORTH 7° 33' 15"
EAST 33.$8 FEET TO AN ANGLE POINT THEREIN; THENCE CONTINUINCa ALONG A 50LITHEASTERLY LINE OF
SAID HELIOTROPE AVENUE; NORTH 33° 19' 45"-EAST 50.02 FEET TO l'HE POINT OF BEGINNING.
PARCEL 2:
AN E:A5EMENT FOR USE TN COMMON WITH OTHERS, FQR INGRESS AND EGRESS IN I1Np ON THE PRIVATE '
STREET'S KNOWN A5 5ZNE] PLACE AND 58TH PLACE, 1N THE CITY OF MAYW04D, C(?UNTY OF LOS ANGELES,
STATE OF CALIFORNIA, CC+VERTNG TH05E CERTAIN gORTI0N5 OF LOTS 102 TO 107 INCLUSIVE OF TRACT
7923, AS PER MAP RECORDED TN $dOK 113 PAGES 80 Td 83 OF MAPS, RECORDS qF LOS ANGELEcS COUNTY,
17ESGRIBED AS FOLLOWS:
BEGINNING AT THE INTERSECTION OF THE NORTHWEST. LINE OF SAID LOT lE?7 WITH THE .SOUTHEASTERLY
PROLONGATION OF THE NORTHEAST LINES OF 52ND PLACE; EXTENDING NORTHWESTERLY FROM HELIOTROPE
.AVENUE; THENCE SOUTHEASrEExLY ALONG SAIp FROI,ONGATION 80.12 FEET; THENCE SOUTH 3$° S4' 30"
EAST 1240.12. FEET TO A POINT 1N A LINE PARALLEL WITH THE SOUTHERLY UNE OF SAID LOT 102 AND
DISTANT NQRTH~RLY 50 FEET, MEASUREp AT RIGEiT ANGLES THEREFROM,-WHICH LAST MENTIONED POINT
IS DISTANT WESTERLY ALONG SAI[) PARALLEL LINE 447.23 FEET FRAM THE NORTHERLY, PROLONGATION OF
THE EASTERLY LINE OF ALAMd AVENUE, THENCE ALONG SAID PARALLEL LINE; SOUTH $2° 47' 15" EAST
847.23 FEET TO THE NORTHERLY PRtLONGATION QF THE FASTERLY UNE;OF ALAMO AVENUE; THENCE
ALONG SAID'PROLONGATION SOUTH 7° 33' 15" W1r5T 50 FEET TO THE~ SOUTH L[NE OF SAID LOT 102;
THENCE ALONG SAID SOUTH LINE NORTH 82° 47' iS" WEST 4b7.05 FEET TO A LINE HEREIN DESIGNATEp A5
A , PARALLEL W,ITI-1 AND DISTANT 5gi1THWESTERLY 5il FEET, MEA5UREp AT RIGFIT ANGLES FROM THE
~AElOVE DESCRIBED UNE NOTED AS HAVING A LENGTH OF 1240,12 FEET; THENCE ALONG SAID PARALLEL LINE
..NORTH 38° °54' 30" WEST 2b4.59 FEET. TO THE NORTHWEST LINE OF SAID. LOT 102,: THENCE ALONG SATp '
NORTHWEST LINE SOUTH_ 51° 00' 30"-WEST 54.15 FEET TO THE WEST LINE OF SAID LOT. 102; THENCE
NORTHERLY- AND' WESTERLY. AL{1NG 7'HE SOUTHERLY LINE OF SAID LOT. 109 TO THE NORTHERLY ,
PROLONGATION OF`THE WEa~`T' LINE: OF YiEOODLAWN AVENUE; THENCE ALONG 5AIa PROLONGATION NORTH
7° 33' 15" EAST 72.25 FEET T4 SAID LINE DESIGNATED A5 "A", THENCE ALONG SAID LINE "A ;NORTH 3$° 59'
30" WEST $63.b7 FEET TO THE EASTERLY PROLONGATION OF THE SOUTH LINE OF SbTH STREET, THENCE
.WESTERLY ALONG SAID PROLONGATION, 63.04 FEET TO THE EAST. LINE OF HELIOTROPE AVENUE; THENCE
NORTHERLY ALONG SAID EAST LINE TQ THE POINT OF BEGINNING.
EXCEPT ANY PORTION THEREOF WITHIN THE LINES OF PARCEL 1 ABOVE.
PARCEL 3:
ALL OF LOTS 78 THROUGH $3 INCLUSIVE, THE NORTHWESTERLY lO fEE'f AND THE SOUTHWESTERLY 17 FEET
OF LOT B4 AND THE SOUTHWESTERLY 17 FEET OF LQT$5, ALL IN TRACT N0, 7423, IN THE COUNTY QF LOS
ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 113 PAGES 80 TQ: Ei3 INCLUSNE OF MAPS,
IN THE {IFICE OF THE COUNTY RECORDER qF SATq C(JUNTY.
EXCEPT THE SOUTHEAST 1 FOOT OF SAID LOT 85. AL50 EXCEPT FROM-THE SOUTHWEST 17 FEET' OF TWE
NORTHWEST l0 FEET OF LQT 84 AND THE SOUTHWEST 17 FEET 4F LOT $5, ALL OIL, GA5 AND OTHER
PETROLEUM. OR MINERAL 5UBS7'ANCE IN SAID LAND, AS RESERVED 8Y S[EEL MERCWANTS COMPANY, A CO
PARTNERSHIP, BY i?EED RECORDED SEPTEMBER ~r, 1958 IIV BOOK D206 PAGE 140, OFFICIAL RECCIRDS.
PARCEL 4:
LOTS 74, 75, 76 AND. 77 aF TRACT 7923, IN THE; CITY OF VERNON, COUNTY OF LOS ANGELES, STATE OF
CALIFORNIA, AS PER MAP ItF±CORDEp IN BOOK 113 PAGES $0 TO 83 iNCLUSNE OF MAPS, TN THE OFFICE OF
THE COUNTY RECORDER ?F SAID COUNTY/
4 CLTA Preliminary Report Form - Modified (11-17-06)
i
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AFAR Titles Company (Hard Copy)
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~N~t THtS.FORM 13 NOT TO BE DUPLfCATED ~1$
6314-023-270 PLEASE READ YELLOW SHEET FIRST
DOC# 09-0802147-01
I~~~ ~~I~~~~II~~ ~I~ II ~~I~~~~~I ~
014/00015***«*******************SN GLP
CITY OF VERNON
4305 S SANTA FE AVE
VERNON, CA 90058-1714
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DISCLOSURE OF RIGHT TO RECEIVE A COPY OF AN APPRAISAL
PrtnCip~j L,t7~D.i~~x~':::;','`,lt~~'ttiirtty ~t~~n iV.O 'w~l~.t.~oil Ac~a~tnt t7ffi~~r lniti~ls
$6 37p,0:0:4 UD
{}'a. i~7: Zpp~ : A~. Q'1..2Q'1.4 _ . X93.32...:: : ~9 70.
References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing has been omitted due to text length limitations.
Applicant: City of Vernon, a Municipal Corporation Lender: East West Bank
4305 Santa Fe Avenue Loan Servicing Department
Vernon, CA 90058 9300 Flair Drive
EI Monte, CA 91731
Disclosure of Right to Receive a Copy of an Appraisal
Application Number: 29332 Loan Number: 29332
You have the right to a copy of the appraisal report used in connection with your application for credit. If you wish to have a copy, please write
to us at the following mailing address East West Bank Appraisal Department 9300 Flair Drive, 6th Floor EI Monte, CA 91731. We must hear
from you no later than ninety (90) days after we notify you about the action taken on your credit application or no later than ninety (90) days
after you withdraw your application.
In your letter, give us the following information:
Borrower's name, property address and loan number
Upon your request, the appraisal report will be sent to:
4305 Santa Fe Avenue
Vernon, CA 90058
Costs of Providing the Appraisal Copy: You are required to pay the cost of the appraisal
APPLICANT ACKNOWLEDGMENT
I acknowledge that I have received a copy of this Disclosure of Right to Receive a Copy of an Appraisal.
APPLICANT:
CITY OF VERNON, A MUNICIPALnCORPORATION
BY~ ~ ~ i2 ~ D By: ~
Hilario Gonzales, Mayor f City of Vernon, Date anuela Giron, C) rk of City of Date
a Municipal Corp tion Vernon, a Municipal Corporation
Je Harri City Attorney of City of Date
Ve , a Mu 'c' al Corporation
LASER PRO Lending, Ver. 5.44.08.002 Copr. Harland Financial Solutions, Inc. 199], 2009. All Rights Rasarvetl. - CA G:WPPBIEWBCFI\CF9LPL1B14.FC TR-9143 PR-1
HAZARD INSURANCE DISCLOSURE
Pr)ncipal Loan t]ax~ ~~tKtyri~y Lean Np" ~a~t f Cuu A~courtt Offidgr Intfrals:
3~Q Q4Q~>~U . 05 .(~'T:2(II7~~.: a~..Q'1` ?U14..:; 2~33~..:........ _ .....;1'70
References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing has been omitted due to text length limitations.
BorrOWer: City of Vernon, a Municipal Corporation Lender: East West Bank
4305 Santa Fe Avenue Loan Servicing Department
Vernon, CA 90058 9300 Flair Drive
EI Monte, CA 91731
HAZARD INSURANCE DISCLOSURE
Made .Pursuant to California Civil Code Section 2955.5
IMPORTANT
DO NOT SIGN THIS FORM UNTIL YOU CAREFULLY
READ IT AND UNDERSTAND ITS CONTENT
You have applied for a loan or credit accommodation that vvill be secured by real 'property. As a condition of the
loan or credif accommodation, Lender may require you to maintain hazard insurance coverage for the real property.
California law provides that Lender cannot requlre you, as a condition of receivin or maintaining a loan secured by
real property, to provide hazard insurance coverage against risks to the propertyy such as fire and other perils) in an
amount exceeding the replacement value of the building or structures attached to the property. _
BY SIGNING BELOW, YOU ACKNOWLEDGE THAT YOU HAVE READ, RECEIVED AND UNDERSTAND THIS
HAZARD INSURANCE DISCLOSURE. THIS DISCLOSURE IS DATED MAY 7, 2009.
BORROWER:
CITY OF VERNON, A MUN~ICI~PAL C,Of
RPORATION
e: ~ y B:
Y ~1.~"lvf B~ Y 1/~--
Hilario Gonzales, Mayor of City of Vernon, a anuela Giron, City ter of City of Vernon, a
Municipal Corporatio Municipal Corporation
By:
Jeff rrison, i Attorney of City of Vernon,' a
Muni ' Corporat n
LASER PRO Lending, Ver. 5.44.00.002 Copr: Harlantl Financial Solullons, Inc. 199], 2009. All Rights Reserved. - CA G:WPPSIEWRCFI\CFALPL1Bi9.FC TR-9140 PR-1 '
ASSIGNMENT OF DEPOSIT ACCOUNT.
P+'1111cip~1 ` ; Lrr~n <Qate M~t~iri~ .
Na:.: Cott !.Cau ftiCCt~tstlY.`> . OffiC~r irlt~t~t5
References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing has been omitted due to text length limitations.
Grantor: City of Vernon, a Municipal Corporation Lender: East West Bank
4305 Santa Fe Avenue Loan Servicing Department ,
Vernon, CA 90058 9300 Flair Drive,
EI Monte, CA 91731
THIS ASSIGNMENT OF DEPOSIT ACCOUNT dated May 7, 2009, is made and executed between City of Vernon, a Municipal Corporation
("Grantor") and East West Bank ("Lender").
ASSIGNMENT. For valuable consideration, Grantor assigns and grants to Lender a security interest in the Collateral, including without limitation
the deposit accounts described below, to secure the Indebtedness and agrees that Lender shall have the rights stated in this- Agreement with
respect to the Collateral, in addition to all other rights which Lender may have by law.
COLLATERAL DESCRIPTION. The word "Collateral" means the following described deposit account ("Account"):
Checking Account Number 80359722 with- Lender for interest reserve
together with (A) all interest, whether now accrued or hereafter accruing; (B) all additional deposits hereafter made to the Account; (C) any
and all proceeds from the Account; and (D) all renewals, replacements and substitutions for any of the foregoing.
CROSS-COLLATERALIZATION. In addition to the Note, this Agreement secures all obligations, debts and liabilities, plus interest thereon, of
Grantor to Lender, or any one or more of them, as well as all claims by Lender against Grantor or any one or more of them, whether now
existing or hereafter arising, whether related or unrelated to the purpose of the Note, whether voluntary or otherwise, whether due or not due,
direct or indirect, determined or undetermined, absolute or contingent, liquidated or unliquidated, whether Grantor may be liable individually or
jointly with others, whether obligated as guarantor, surety, accommodation party or otherwise, and whether recovery upon such amounts may
be or hereafter may. become barred by any statute of limitations, and whether the obligation to repay such amounts may be or hereafter may
become otherwise unenforceable.
GRANTOR'S REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE COLLATERAL. With respect to the Collateral, Grantor represents
and promises to Lender that:
Ownership. Grantor is the lawful owner of the Collateral free and clear of all loans, liens, encumbrances, and claims except as disclosed to
and accepted by Lender in writing.
Right to Grant Security Interest. Grantor has the full-right, power, and authority to enter into this Agreement and to assign the Collateral to
Lender.
IJo Prior Assignment. Grantor has not previously granted a security interest in the Collateral to any other creditor.
No Further Transfer. Grantor shall not sell, assign, encumber, or otherwise dispose of any of Grantor's rights in the Collateral except as
provided in this Agreement.
No Defaults. There are no defaults relating to the Collateral, and there are no offsets or counterclaims to the same. Grantor will strictly
and promptly do everything required of Grantor under the terms, conditions, promises, and agreements contained in or relating to the
Collateral.
Proceeds. Any and all replacement or renewal .certificates, instruments, or other benefits or proceeds related to the Collateral that are
received by Grantor shall be held by Grantor in trust for Lender and immediately shall be delivered by Grantor to Lender to be held as part
of the Collateral
Validity; Binding Effect. This Agreement is binding upon Grantor and. Grantor's successors and assigns and is legally enforceable in
accordance with its terms.
Financing Statements. Grantor authorizes Lender to file a UCC financing statement, or alternatively, a copy of this Agreement to perfect
Lender's security interest. At Lender's request, Grantor additionally agrees to sign all other documents that are necessary to perfect,
protect, and continue Lender's security interest in the Property. This includes making sure Lender is shown as the first and only security
interest holder on the title covering the Property. Grantor will pay all filing fees, title transfer fees, and other fees and costs involved unless
prohibited by law or unless Lender is required by law to pay such fees and costs. Grantor irrevocably appoints Lender to execute
documents necessary to transfer title if there is a default. Lender may file a copy of this Agreement as a financing statement. If Grantor
changes Grantor's name or address, or the name or address of any person granting a security interest -under this Agreement changes,
Grantor will promptly notify the Lender of such change.
LENDER'S RIGHTS AND OBLIGATIONS WITH RESPECT TO THE COLLATERAL. While this Agreement is in effect, Lender may retain the rights
to possession of the Collateral, together with any and all evidence of the Collateral, such as certificates or passbooks. This Agreement will
remain in effect until (a) there no longer is any Indebtedness owing to Lender; (b) all other obligations secured by this Agreement have been
fulfilled; and (c) Grantor, in writing, has requested from Lender a release of this Agreement.
LENDER'S EXPENDITURES. If any action or proceeding is commenced that would materially affect Lender's interest in the Collateral or if
Grantor fails to comply with any provision of this Agreement or any Related Documents, including but not limited to Grantor's failure to
.discharge or pay when due any amounts Grantor is required to discharge or pay under this Agreement or any Related Documents, Lender on
Grantor's behalf may (but shall not be obligated to) take any action that Lender deems appropriate, including .but not limited to discharging or
paying all taxes, liens, security interests, encumbrances and other claims, at any time levied or placed on the Collateral and paying all costs for
insuring, maintaining and preserving the Collateral. All such expenditures incurred or paid by Lender for such purposes will then bear interest at
the rate charged under the Note from the date incurred or paid by Lender to the date of repayment by Grantor. All such expenses will became a
part of the Indebtedness and, at Lender's option, will (A) be payable on demand; (B) be added to the balance of the Note and be apportioned
among and be payable with any installment payments to become due during either (1) the term of any. applicable insurance policy; or (2) the
remaining terra of the Note; or (C) be treated as a balloon payment which will be due and payable at the Note's maturity. The Agreement also
will secure payment of these amounts. Such right shall be in addition to all other rights and remedies to which Lender may be entitled upon
Default.
LIMITATIONS ON OBLIGATIONS OF LENDER. Lender shall use ordinary reasonable care in the physical preservation and custody of any
ASSIGNMENT OF DEPOSIT ACCOUNT
Loan No: 29332 (Continued) Page 2
certificate or passbook for the Collateral but shall have no other obligation to protect the Collateral or its value. In particular, but without
limitation, Lender shall have no responsibility (A) for the collection or protection of any income on the. Collateral; (B) for the preservation of
rights against issuers of the Collateral or against third persons; (C) for ascertaining any maturities, conversions, exchanges, offers, tenders, or
similar matters relating to the Collateral; nor (D) -for informing the Grantor about any of-the above, whether or not Lender has or is deemed to
have knowledge of such matters.
DEFAULT. Each of the following shall constitute an Event of Default under this Agreement:
Payment Default. Grantor fails to make any payment when due under the Indebtedness.
Other Defaults. Grantor fails to comply with or to perform any other term, obligation, covenant or condition contained in this Agreement or
in any of the .Related Documents or to comply with or to perform any term, obligation, covenant or condition contained in any other
agreement between Lender and Grantor.
Default in Favor of Third Parties. Grantor defaults under any loan, extension of credit, security agreement, purchase or sales agreement, or
any other agreement, in favor of any other creditor or person that may materially affect any of Grantor's property or ability to perform
Grantor's obligations under this. Agreement or any of the Related Documents.
False Statements. Any warranty, representation or statement made or furnished to Lender by Grantor or on Grantor's behalf under this
Agreement or the Related Documents is false or misleading in any material respect, either now or at the time made or furnished or becomes
false or misleading at any time thereafter.
,Defective Collateralization. This Agreement or any of the Related Documents ceases to be in full force and effect (including failure of any
collateral document to create a valid and perfected security interest or lien) at any time and for any reason.
Insolvency. The dissolution or termination of Grantor's existence as a going business, the insolvency of Grantor, the appointment of a
receiver for any part of Grantor's property, any assignment for the benefit of creditors, any type of creditor workout, or the commencement
of any proceeding under any bankruptcy or insolvency laws by or against Grantor.
Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Grantor or by any governmental agency against any collateral securing the
Indebtedness. This includes a garnishment of any of Grantor's accounts, indluding deposit accounts, with Lender. However, this Event of
Default shall not apply if there is a good faith dispute by Grantor as to the validity or reasonableness of the claim which is the basis of the
creditor or forfeiture proceeding and if Grantor gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender
monies or a surety bond for the creditor or forfeiture proceeding, in an amount determined by Lender, in its sole- discretion, as being an
adequate reserve or bond for the dispute.
Events Affecting Guarantor. Any of the preceding events occurs with respect to any guarantor, endorser, surety, or accommodation party
of any of the Indebtedness or guarantor, endorser, surety, or accommodation party dies or becomes incompetent or revokes or disputes the
validity of, or liability under, any Guaranty of the Indebtedness.
Adverse Change. A material adverse change occurs in Grantor's financial condition, or Lender believes the prospect of payment or
performance of the Indebtedness is impaired.
Cure Provisions. If any default, other than a default in payment is curable and if Grantor has not been given a notice of a breach of the
same provision of this Agreement within the preceding twelve (12) months, it may be cured if Grantor, after receiving written notice from
Lender demanding cure of such default: (1) cures the default within fifteen (15) days; or (2) if the cure requires more than fifteen (15)
days, immediately initiates steps which Lender deems in Lender's sole discretion to be sufficient to cure the default and thereafter
continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as reasonably practical.
RIGHTS AND REMEDIES ON DEFAULT. Upon the occurrence of an Event of Default, or at any time thereafter, Lender may exercise any one or
more of the following rights and remedies, in addition to any rights or remedies that may be available at law, in equity, or otherwise:
Accelerate Indebtedness. Lender may declare all Indebtedness of Grantor to Lender immediately due and payable, without notice of any
kind to Grantor.
Application of Account Proceeds. Lender may take directly all funds in the Account and apply them to the Indebtedness. If the Account is
subject to an early withdrawal penalty, that penalty shall be deducted from the Account- before its application to the Indebtedness, whether
the Account is with Lender or some other institution. Any excess funds remaining after application of the Account proceeds to the
Indebtedness will be paid to Grantor as the interests of Grantor may appear. Grantor agrees, to the extent permitted by law, to pay any
deficiency after application of the proceeds of the Account to the Indebtedness. Lender also shall have all the rights of a secured party
under the California Uniform Commercial Code, even if the Account is not otherwise subject to such Code concerning security interests,
and the parties to this Agreement agree that-the provisions of the Code giving rights to a secured party shall nonetheless be a part of this
Agreement.
Transfer Title. Lender may effect transfer of title upon sale of all or part of the Collateral. For this purpose, Grantor irrevocably appoints
Lender as Grantor's attorney-in-fact to execute endorsements, assignments and instruments in the name of Grantor and each of them (if
more than one) as shall be necessary or reasonable.
Other Rights and Remedies. Lender shall have and may exercise any or all of the rights and remedies of a secured creditor under the
provisions of the California Uniform Commercial Code, at law, in equity, or otherwise.
Deficiency Judgment. If permitted by applicable law, Lender may obtain a judgment for any deficiency remaining in the Indebtedness due
to Lender after application of all amounts received from the exercise of the rights provided in this section.
Election of .Remedies. Except as may be prohibited by .applicable law, all of Lender's rights and remedies, whether evidenced by this
Agreement or by any other writing, shall be cumulative and may be exercised singularly or concurrently. Election by Lender to pursue any
remedy shall not exclude pursuit of any other remedy, and an election to make expenditures or to take action to perform an obligation of
Grantor under this Agreement, after Grantor's failure to perform, shall not affect Lender's right to declare a default and exercise its
remedies.
Cumulative Remedies. All of Lender's rights and remedies, whether evidenced by this Agreement or by any other writing, shall be
cumulative and may be exercised singularly or concurrently. Election by Lender to pursue any remedy shall not exclude pursuit of any other
remedy, and an election to make expenditures or to take action to perform an obligation of Grantor under this Agreement, after Grantor's
failure to perform, shall not affect Lender's right to declare a default and to exercise its remedies.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Agreement:
Amendments. This Agreement; together with any Related Documents, constitutes the entire understanding and agreement of the parties
ASSIGNMENT OF DEPOSIT ACCOUNT
Loan No: 29332 (COntlnued) Page 3
as to the matters set forth in this Agreement. No alteration of or amendment to this Agreement shall be effective unless given in writing
and signed by the party or parties sought to be charged or bound by the. alteration or amendment.
Attorneys' Fees; Expenses. Grantor agrees to pay upon demand all of Lender's costs and expenses, including Lender's attorneys' fees and
Lender's legal expenses, incurred in connection with the enforcement of this Agreement. Lender may hire or pay someone else to help
enforce this Agreement, and Grantor shall pay the costs and expenses of such enforcement. Costs and expenses include Lender's
attorneys' fees and legal expenses whether or not there is a lawsuit, including attorneys' fees and legal expenses for bankruptcy
proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post-judgment collection
services. Grantor also shall pay all court costs and such additional fees as may be directed by the court.
Caption Headings. Caption headings in this Agreement are for convenience purposes only and are not to be used to interpret or define the
provisions of this Agreement.
Governing Law. This Agreement will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the
laws of the State of California without regard to its conflicts of law provisions. This Agreement has been accepted by Lender in the State
of California
Preference Payments. Any monies Lender pays because of an asserted preference claim in Grantor's bankruptcy will become a part of the
Indebtedness and, of Lender's option, shall be payable by Grantor as provided in this Agreement. '
No Waiver by Lender. Lender shall not be deemed to have waived any rights under this Agreement unless such waiver is given in writing
and signed by Lender. No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any
other right: A waiver by Lender of a provision of this Agreement shall not prejudice or constitute a waiver of Lender's right otherwise to
demand strict compliance with that provision or any other provision of this Agreement. No prior waiver by Lender, nor any course of
dealing between Lender and Grantor, shall constitute a waiver of any of Lender's- rights or of any of Grantor's obligations as to any future
transactions. Whenever the consent of Lender is required under this Agreement, the granting of such consent by Lender in any instance
shall not constitute continuing consent to subsequent instances where such consent is required .and in all cases such consent may be
granted or withheld in the sole discretion of Lender.
Notices. Any notice required to be given under this Agreement shall be given in writing, and shall be effective when actually delivered,
when actually received by telefacsimile (unless otherwise required by law), when deposited with a nationally recognized overnight courier,
or, if mailed, when deposited in the United States mail, as first class, certified or registered mail postage prepaid, directed to the addresses
shown near the beginning of this Agreement. Any party may change its address for notices under this Agreement by giving format written
notice to the other parties, specifying that the purpose of the notice is to change the party's address. For notice purposes, Grantor agrees
to keep Lender informed at all times of Grantor's current address. Unless otherwise provided or required by law, if-there is mare than one
Grantor, .any notice given by Lender to any Grantor is deemed to be Notice given to all Grantors.
Power of Attorney. Grantor hereby appoints Lender as its true and lawful attorriey-in-fact, irrevocably, with full power of substitution to do
the following: (1) to demand, collect, receive, receipt for, sue and recover all sums of money or other property which may now or
hereafter become due, owing or payable from the Collateral; (2) to execute, sign and endorse any and all claims, instruments, receipts,
checks, drafts or warrants issued in payment for the Collateral; (3) to settle or compromise any and all claims arising under the Collateral,
and in the place and stead of Grantor, to execute and deliver its release and settlement for the claim; and (4) to file -any claim or claims or
to take any action or institute or take part in any proceedings, either in its own name or in the-name of Grantor, or otherwise, which in the
discretion of Lender may seem to be necessary or advisable. This power is given as security for the Indebtedness, -and the authority hereby
conferred is and shall be irrevocable and shall remain in full force and effect until renounced by Lender.
Waiver of Co-Obligor's Rights. If more than one person is obligated for the Indebtedness, Grantor irrevocably waives, disclaims and
relinquishes all claims against such other person which Grantor has or would otherwise have by virtue of payment of the Indebtedness or
any part thereof, specifically including but not limited to all rights of indemnity, contribution or exoneration.
Severability. If a court of competent jurisdiction finds any provision of this Agreement to be illegal, invalid, or unenforceable as to any
circumstance, that finding shall not make the offending provision illegal, invalid, or unenforceable as to any other circumstance. If feasible,
the offending provision shall be considered modified so that it becomes legal, valid and enforceable. If the offending provision cannot be so
modified, it shall be considered deleted from this Agreement. Unless otherwise required by law, the illegality, invalidity, or unenforceability
of any provision of this Agreement shall not affect the legality, validity or enforceability of any other provision of this Agreement.
Successors and Assigns. Subject to any limitations stated in this Agreement on transfer of Grantor's interest, this Agreement shall be
binding upon and inure to the benefit of the parties, their successors and assigns. If ownership of the Collateral. becomes vested in a
person other than Grantor, Lender, without notice to Grantor, may deal with Grantor's successors with reference to this Agreement and the
Indebtedness by way of forbearance or extension without releasing Grantor from the obligations of this Agreement or liability under the
Indebtedness.
Survival of Representations and Warranties. All representations, warranties, and agreements made by Grantor in this Agreement shall
survive the execution and delivery of this Agreement, shall be continuing in nature, and shall remain in full force and effect until such time
as Grantor's Indebtedness shall be paid in full.
Time is of the Essence. Time is of the essence in the performance of this Agreement.
Waive Jury. To the extent permitted by applicable law, all parties to this Agreement hereby waive the right to any jury trial in any action,
proceeding, or counterclaim brought by any party against any other party.
DEFINITIONS. The following capitalized words and terms shall have the following meanings when used in this Agreement. Unless specifically
stated to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and terms
used in the singular shall include the plural, and the plural shall include the singular, as the context may require. Words and terms not otherwise
defined in this Agreement shall have the meanings attributed to such terms in the Uniform Commercial Code:
Account. The word "Account" means the deposit accounts described in the "Collateral Description" section.
Agreement. The word "Agreement" means this Assignment of Deposit Account, as this Assignment of Deposit Account may be amended
or modified from time to time, together with all exhibits and schedules attached to this Assignment of Deposit Account from time to time.
Borrower. The word "Borrower" means City of Vernon, a Municipal Corporation and includes all co-signers and co-makers signing the Note
and all their successors and assigns. ,
Collateral. The word "Collateral" means all of Grantor's right, title and interest in and to all the Collateral as described in the Collateral
Description section of this Agreement.
Default. The word "Default" means the Default set forth in this Agreement in the section titled "Default".
ASSIGNMENT OF DEPOSIT ACCOUNT
Loan No: 29332 (Continued) Page 4
Event of Default. The words "Event of Default" mean any of the events of default set forth in this Agreement in the default section of this
Agreement.
Grantor. The word "Grantor" means City of Vernon, a Municipal Corporation.
Guaranty. The word "Guaranty" means the guaranty from guarantor, endorser, surety, or accommodation party to Lender, including
without limitation a guaranty of all or part of the Note.
Indebtedness. The word "Indebtedness" means the indebtedness evidenced by the Note or Related Documents, including all principal and
interest together with all other indebtedness and costs and expenses for which Grantor is responsible under this Agreement or under any of
the Related Documents. Specifically, without limitation, Indebtedness includes all amounts that may be indirectly secured by the
Cross-Collateralization provision of this Agreement.
Lender. The word "Lender" means East West Bank, its successors and assigns.
Note. The word "Note" means the Note executed by City of Vernon, a Municipal Corporation. in the principal amount of $6,370,000.00
dated May 7, 2009, together with all renewals of; extensions of, modifications of, refinancings of, consolidations of, and substitutions for,
the note or credit agreement.
Property. The word "Property" means all of Grantor's right, title and interest in and to all the Property as described in the "Collateral
Description" section of this Agreement.
Related Documents. The words "Related Documents" mean all promissory notes, credit agreements, loan agreements, environmental
agreements, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements
and documents, whether now or hereafter existing, executed in connection with the Indebtedness.
GRANTOR HAS READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS ASSIGNMENT OF DEPOSIT ACCOUNT AND AGREES TO ITS
TERMS. THIS AGREEMENT IS DATED MAY 7, 2009.
GRANTOR:
CITY OF VERNON, A~{MUNIC__IPppA~~L CORPORATION
BY: i~ F-~'V By:
Hilario Ganza es, yor of City of Vernon, a anuela Giron, Ci er of City of Vernon, a
Munici al Corporati Municipal Corporation
By:
Jeff iso i Attorney of City of Vernon, a
Muni i orpo ti n
LASER PRO Londing, Ver. 5.44.00.002 Copr. Harlantl Financial Solutions, Inc. 10fl], 2088. All RigM1ls Reserved. - CA G:WPP5IEWBCFIICF~LPL1E90.FC TR-8149 PR-1
1
RECORDATION REQUESTED BY;
' East West Bank
Loan Servicing Department
9300 Flair Drive
EI Monte, CA 91731
WHEN RECORDED MAIL TO:
East West Bank
Loan Service Department
9300 Flair Drive, 6th Floor
EI Monte, CA 91731
FOR RECORDER'S USE ONLY
DEED OF TRUST
THIS DEED OF TRUST is dated May 7, 2009, among The City of Vernon, A Body Corporate and Politic
("Trustor"); -East West Bank, whose address is Loan Servicing Department, 9300 Flair Drive, EI Monte, CA
91731 (referred to below sometimes as "Lender" and sometimes as "Beneficiary"); .and EAST WEST
INVESTMENT INC., A CALIFORNIA CORPORATION ,whose address is 9300 Flair Drive, 6th Floor, EI Monte,
CA 91731 (referred to below as "Trustee").
CONVEYANCE AND GRANT. For valuable consideration, Trustor irrevocably grants, transfers and assigns to Trustee in .trust, with power
of sale, for the benefit of Lender as Beneficiary, all of Trustor's right, title, and interest in and to the following described real property,
together with all existing or subsequently erected or affixed buildings, improvements and fixtures; all easements, rights of way, and
appurtenances; all water, water rights and ditch rights (including stock in utilities with ditch or irrigation rights); and all other ri hts,
royalties, and profits relating to the real property, including without limitation all minerals, oil, gas, geothermal and similar matters, the
"Real Property") located in Los Angeles County, State of California:
See Exhibit "A", which is attached to this Deed of Trust and made a part of this Deed of Trust as if fully
set forth herein.
The Real Property or its address is .commonly known as 4855 East 52nd Place, Vernon, CA 90058-5507.
The Assessor's Parcel Number. for the Real Property is 6314-019-900; 6314-022-900 and 6314-023-270.
Trustor presently assigns to Lender (also known as Beneficiary in this Deed of Trust) all of Trustor's right, title, and interest in and to all
present and future leases of the Property and all Rents from the Property. This is an absolute assignment of Rents made in connection
with an obligation secured by real property pursuant to California Civil Code Section 2938. In addition, Trustor grants to Lender a Uniform
Commercial Code security interest in the Personal Property and Rents.
THIS DEED OF TRUST, INCLUDING THE ASSIGNMENT OF RENTS AND THE SECURITY INTEREST IN THE RENTS AND PERSONAL
PROPERTY, IS GIVEN TO SECURE (A) PAYMENT OF THE INDEBTEDNESS AND (B) PERFORMANCE OF ANY AND ALL OBLIGATIONS
UNDER THE NOTE, THE RELATED DOCUMENTS, AND THIS DEED OF TRUST.. THIS DEED OF TRUST IS GIVEN AND ACCEPTED ON THE
FOLLOWING TERMS:
TRUSTOR'S REPRESENTATIONS AND WARRANTIES. Trustor warrants that: (a) this Deed of Trust is executed at Borrower's request and
not at the request of Lender; (b) Trustor has the full power, right, and authority to enter into this Deed of Trust ahd to hypothecate the
Property; (c) the provisions of this Deed of Trust do not conflict with, or result in a default under any agreement or other instrument
binding upon Trustor and do not result in a violation of any law, regulation, court decree or-order applicable to Trustor; (d) Trustor has
established adequate means of obtaining from Borrower on a continuing basis information about Borrower's financial condition; and (e)
Lender has made no representation to Trustor about Borrower (including without limitation the creditworthiness. of Borrower).
TRUSTOR'S WAIVERS. Except as prohibited by applicable law, Trustor waives any right to require Lender to (a) make any presentment,
protest, demand, or notice of any kind, including notice of change of any terms of repayment of the Indebtedness, default by. Borrower or
any other guarantor or surety, any action or nonaction taken by Borrower, Lender, or any other guarantor or surety of Borrower, or the
creation of new or additional Indebtedness; (b) proceed against any person, including Borrower, before proceeding against Trustor; (c)
proceed against any collateral for the Indebtedness, including Borrower's collateral, before proceeding against Trustor; (d) apply any
payments or proceeds received against the Indebtedness in any order; (e) give notice of the terms, time, and place of any sale of any
collateral pursuant to the Uniform Commercial Code or any -other law governing such sale; (f] disclose any information about the
Indebtedness, Borrower, any collateral, or any other guarantor or surety, or about any action or nonaction of Lender; or (g) pursue any
remedy or course of action in Lender's power whatsoever.
Trustor also waives any and all rights or defenses arising by reason of (h) any disability or other defense of Borrower, any other guarantor
or surety or any other person; (i) the cessation from any cause whatsoever, other than payment. in full, of the Indebtedness; Q) the
application of proceeds of the Indebtedness by Borrower for purposes other than the purposes understood and intended by Trustor and
Lender; (k) any act of omission or commission by Lender which directly or indirectly results in or contributes to the discharge of Borrower
or ahy other guarantor or surety, or the Indebtedness, or the loss or release of any collateral by operation of law or otherwise; (I) any
statute of limitations in any action under this Deed of Trust or on the Indebtedness; or (m) any modification or change in terms of the
Indebtedness, whatsoever, including without limitation, the renewal, extension, acceleration, or other change in the time payment of the
Indebtedness is due and any change in the interest rate.
DEED OF TRUST
Loan No: 29332 (COntlnued) Page 2
Trustor waives all rights and defenses arising out of an election of remedies by Lender, even though that election of remedies, such as
non-judicial foreclosure with respect to security fora guaranteed obligation, has destroyed Trustor's rights of subrogation and
reimbursement against Borrower by the operation of Section 580d of the California Code of Civil Procedure, or otherwise.
Trustor waives all rights and defenses that Trustor may have because Borrower's obligation is secured by real property. This means
among other things: (1) Lender may collect from Trustor without first foreclosing on any real or personal property collateral pledged by
Borrower. (2) If Lender forecloses on any real property collateral pledged by Borrower: (A) The amount of Borrower's obligation may be
reduced only by the price for which the collateral is sold at the foreclosure sale, even if the collateral is worth more than the sale price. (B)
Lender may collect from Trustor even if Lender, by foreclosing on the real property collateral, has destroyed any right Trustor may have to
collect from Borrower. This is an unconditional and irrevocable waiver of-any rights and defenses Trustor may have because Borrower's
obligation is secured by real property. These rights and defenses include, but are not limited to, any rights and defenses based upon
Section 580a, 580b, 580d, or 726 of the Code of Civil Procedure.
Trustor understands and agrees that the foregoing waivers are unconditional and irrevocable waivers of substantive rights and defenses to
which Trustor might otherwise be entitled under state and federal law. The rights and defenses waived include, without limitation, those
provided by California laws of suretyship and guaranty, anti-deficiency laws, and the Uniform Commercial Code. Trustor acknowledges .
that Trustor has provided these waivers of rights and defenses with the intention that they be fully relied- upon by Lender. Trustor further
understands and agrees that this Deed of Trust is a separate and independent contract between Trustor and Lender, given for full and
ample consideration, and is enforceable on its own terms. Until all Indebtedness is paid in full, Trustor waives any right to enforce any
remedy Trustor may have against Borrower's or any other guarantor, surety, or other person, and further, Trustor waives any right to
participate ih any collateral for the Indebtedness now or hereafter held by Lender.
PAYMENT AND PERFORMANCE. Except as otherwise provided in this Deed of Trust, Borrower shall pay to Lender all' Indebtedness
secured by this Deed of Trust as it becomes due, and Borrower and Trustor shall perform all their respective obligations under the Note,
this Deed of Trust, and the Related Documents.
POSSESSION AND MAINTENANCE OF THE PROPERTY. Borrower and Trustor agree that Borrower's and Trustor's possession 2nd use of
the Property shall be governed by the following provisions:
Possession and Use. Until the occurrence of an Event of Default, Trustor may (1) remain in possession and control of the Property;
(2) use, operate or manage the Property; and (3) collect the Rents-from the. Property.
Duty to Maintain. Trustor shall maintain the Property in tenantable condition and promptly perfiorm .all repairs, replacements, and.
maintenance necessary to preserve its value.
Compliance With Environmental Laws. Trustor represents and warrants to Lender that: (1) During the period of Trustor's ownership
of the Property, there has been no use, generation, manufacture, storage, treatment, disposal, release or threatened release of any
Hazardous Substance by any person on, Lnder,-about or from the Property; (2) Trustor has no knowledge of, or reason to believe .
that-there has been, except as previously disclosed to and acknowledged by Lender in writing, (a) any breach or violation of any
Environmental Laws, (b) any use, generation, manufacture, storage, treatment, disposal, release or threatened release of any
Hazardous Substance on, under, about or from the Property by any prior owners or occupants of the Property, or (c) any actual or
threatened litigation or claims of any kind by any person relating to such matters; and (3) Except as previously disclosed to and
acknowledged by Lender in writing, (a) neither Trustor. nor any tenant, contractor, agent oY other authorized -user of the Property
shall use, generate, manufacture, store, treat, dispose of or release any Hazardous Substance on, uhder, about or from the Property;
and (b) any such activity shall be conducted in compliance with all applicable federal, state, and local laws, regulations and
ordihances, including without limitation all Environmental Laws. Trustor authorizes Lender and its agents to enter upon the Property
to make such inspections and tests, at Trustor's expense, as Lender may deem appropriate to determine compliance of the Property
with this section of the Deed of Trust. Any inspections or tests made by Lender shall be for Lender's purposes only and shall not be
construed to create any responsibility or liability on the part of Lender to Trustor or to any other person. The representations and
warranties contained herein are based on Trustor's due diligence in investigating the Property for Hazardous Substances. Trustor
hereby (1) releases and waives any future claims against Lender for indemnity or contribution in the event Trustor becomes liable for
cleanup or other costs under any such laws; and (2) agrees to indemnify, defend, and hold harmless Lender against any and all
claims, losses, liabilities, damages, penalties, and expenses which Lender may directly or indirectly sustain or suffer resulting from a
breach of this section of the Deed of Trust or as a consequence of any use, generation, manufacture, storage, disposal, release or
threatened release occurring prior to Trustor's ownership or interest in the Property, whether or not the same was or should have
been known to Trustor. The provisions of this section of the Deed of Trust, including the obligation to indemnify and defend, shall
survive the payment of the Indebtedness and the satisfaction and reconveyance of the lien of this Deed of Trust and shall not be
affected by Lender's acquisition of any interest in the Property, whether by foreclosure or otherwise.
Nuisance, Waste. Trustor shall not cause, conduct or permit any nuisance nor commit, permit, or suffer any stripping of or waste on
or to the Property or any portion of the Property. Without limiting the generality of the foregoing, Trustor will. not remove, or grant to
any other party the right to remove, any timber, minerals (including oil and gas), coal; clay, scoria, soil, gravel or rock products
without Lender's prior written consent.
Removal of Improvements. Trustor shall not demolish or remove any Improvements from the Real Property without Lender's prior
written consent. As a condition to the removal of any Improvements, Lender may require Trustor to make arrangements satisfactory
to Lender to replace such Improvements with Improvements of at least equal value.
Lender's Right to Enter. Lender and Lender's agents and representatives may enter upon the Real Property at all reasonable times to
attend to Lender's interests and to inspect the Real Property for purposes of Trustor's compliance with the terms and conditions of
this Deed of Trust.
Compliance with Governmental Requirements. Trustor shall promptly comply with all laws, ordinances, and regulations, now or
hereafter.in effect, of all governmental authorities applicable to the use or occupancy of the Property, including without limitation, the
Americans With Disabilities Act. Trustor may contest in good faith any such law, ordinance, or regulation and withhold compliance
during any proceeding, including appropriate appeals, so long as Trustor has notified Lender in writing prior to doing so and so long as,
DEED OF TRUST
Loan No: 29332 (COiltIllUed~ Page 3
in Lender's sole opinion, Lender's interests in the Property are not jeopardized. Lender may require Trustor to post adequate security
or a surety bond, reasonably satisfactory to Lender, to protect Lender's interest.
Duty to Protect. Trustor agrees neither. to abandon .or leave unattended the Property: Trustor shall do all other acts, in addition to
those acts set forth above in this section, which from the character and use of the Property are reasonably necessary to protect and
preserve the Property.
DUE ON SALE -CONSENT BY LENDER. Lender may, at Lender's option, declare immediately due and payable all sums secured by this
Deed of Trust upon the sale or transfer, without Lender's prior written consent, of all or any part of the Real Property, or any interest in the
Real Property. A "sale or transfer" means the conveyance of Real Property or any right, title or interest in the Real Property; whether legal,
beneficial or equitable; whether voluntary or involuntary; whether by outright sale, deed, installmerit sale contract, land contract, contract
for deed,. leasehold interest with a term greater- than three (3) years, lease-option contract, or by sale, assignment, or transfer of any
beneficial interest in or to any land trust holding title to the Real Property, or by any other method of conveyance of an interest in the Real
Property. If any Trustor is a corporation, partnership or limited liability company, transfer also includes any change in ownership of more
than twenty-five percent (25%) of the voting stock, partnership interests or limited liability company interests, as the case may be, of such
Trustor. However, this option shall not be exercised by Lender if such exercise is prohibited by applicable law.
TAXES AND LIENS. The following provisions relating to the taxes and liens on the Property are part of this Deed of Trust:
Payment. Trustor shall pay when due (and in all events at least ten (10) days prior to delinquency) all taxes, special taxes,
assessments, charges (including water and sewer), fines and impositions levied against or on account of the Property, and shall pay
when due all claims for work done on or for services rendered or material furnished to the Property. Trustor shall maintain the
Property free of all liens having priority over or equal to the interest of Lender under this Deed of Trust, except for the lien of taxes
-and assessments not due and except as otherwise provided in this Deed of Trust.
Right to Contest. Trustor may withhold paymenf of any tax, assessment, or claim in connection with a good faith dispute over the
obligation to pay, so long as Lender's interest in the Property is not jeopardized. If a lien arises or is filed as a result of nonpayment,
Trustor shall within fifteen (15) days after the lien arises or, if a lien is filed, within fifteen (15) days after Trustor has notice of the
filing, secure the discharge of the lien, or if requested by Lender, deposit with Lender cash or a sufficient corporate surety bond or
other security satisfactory to Lender in an amount sufficient to discharge the lien plus any costs and attorneys' fees, or other charges
that could accrue as a result of a foreclosure or sale under the lien. In any contest, Trustor shall defend itself-and Lender and shall
satisfy any adverse judgment before enforcement. against the Property. Trustor shall name Lender as an additional obligee under any
surety bond furnished in the contest proceedings.
Evidence of Payment. Trustor shall upon demand furnish to Lender satisfactory evidence of payment of the taxes or assessments and
shall authorize the appropriate governmental official to deliver to Lender at any time a written statement of the taxes and assessments
against the Property.
Notice of Construction. Trustor shall notify Lender at least fifteen (15) days before any work is commenced, .any services are
furnished, or any materials are supplied to the Property, if any mechanic's lien, materialmen's lien, or other lien could be asserted on
account of the work, services, or materials and the cost exceeds 1000. Trustor will upon request of Lender furnish to Lender
advance assurances satisfactory to Lender that Trustor can and will pay the cost of such improvements.
PROPERTY DAMAGE INSURANCE. The following provisions relating to insuring the Property are a part of this Deed of Trust.
Maintenance of Insurance. Trustor shall procure and maintain policies of fire insurance with standard extended coverage
endorsements on a replacement basis for the full insurable value covering all Improvements on the Real Property in an amount
sufficient to avoid application of any coinsurance clause, and with a standard mortgagee clause in favor of Lender. Trustor shall also
procure and maintain comprehensive general liability insurance in such coverage amounts as Lender may request with Trustee and
Lender being named as additional insureds in such liability insurance policies. Additionally, Trustor shall maintain such other.
insurance, including but not limited to hazard, business interruption, and boiler insurance, as Lender may reasonably require.
Notwithstanding the foregoing, in no event shall Trustor be required to provide hazard insurance in excess of the replacement value of
the improvements on the Real Property. Policies shall be written in form, amounts, coverages and basis reasonably acceptable to .
Lender and issued by a company or companies reasonably acceptable to Lender. Trustor, upon. request of Lender, will deliver to
Lender from time to time the policies or certificates of insurance in form satisfactory to Lender, including stipulations that coverages
will not be cancelled or diminished without at least thirty (30) days prior written notice to Lender. Each insurance policy also shall
include an endorsement providing that coverage in favor of Lender will not be impaired in anyway by any act, omission or default of
Trustor or any other person. Should the Real Property be located in an area designated by the Director of .the Federal Emergency
Management Agency as a special flood hazard area, Trustor agrees to obtain and maintain Federal Flood Insurance, if available, within
45 days after notice is given by Lender that the Property. is located in a special flood hazard area, for the full unpaid principal balance
of the loan and any prior liens on the property securing the loan, up to the maximum policy limits set under the National Flood
Insurance Program, or as otherwise required by Lender, and to maintain such insurance for the term of the loan.
Application of Proceeds. Trustor shall promptly notify Lender of any loss or damage to the Property if the estimated cost of repair or
replacement exceeds 1000. Lender may make proof of loss if Trustor fails to do so within fifteen (15) days of the casualty. If in
Lender's sole judgment Lender's security interest in the Property has been impaired, Lender may, at Lender's election, receive and
retain the proceeds of any insurance and apply the proceeds to the reduction of the Indebtedness, payment of any lien affecting the
Property, or the restoration and repair of the Property. If the proceeds are to be applied to restoration and repair, Trustor shall repair
or replace the damaged or destroyed Improvements in a manner satisfactory to Lender. Lender shall, upon satisfactory proof of such
expenditure, pay or reimburse Trustor from the proceeds for the reasonable cost of repair or restoration if Trustor is not in default
under this Deed of Trust. Any proceeds which have not been disbursed within 180 days after their receipt and which Lender has not
committed to the repair or restoration of the Property shall be used first to pay any amount owing to Lender under this Deed of Trust,
then to pay accrued interest, and the remainder, if any, shall be applied to the principal balance of the Indebtedness. If Lender holds
any proceeds after payment in full of the Indebtedness, such proceeds shall be paid to Trustor as Trustor's interests may appear.
Trustor's Report on Insurance. Upon request of Lender, however not more than once a year, Trustor shall furnish to Lender a report
DEED OF TRUST
Loan No: 29332 (COntlnued) Page 4
on each existing policy of insurance showing: (1) the name of the insurer; (2) the risks insured; (3) .the amount of the policy; (4)
the property insured, the then current replacement value of such property, and the manner of determining that value; and (5) the
expiration date of the policy. Trustor shall, upon request of Lender, have an independent appraiser satisfactory to Lender determine
the cash value replacement cost of the Property.
TAX AND INSURANCE RESERVES. Subject to any limitations set by applicable law, Lender may require Trustor to maintain with Lender
reserves for payment of annual taxes, assessments, and insurance premiums, which reserves shall be created by advance payment or
monthly payments of a sum estimated by Lender to be sufficient to produce, amounts at least equal to the taxes, assessments, and
insurance premiums to be paid. The reserve funds shall be .held by Lender as a general deposit from Trustor, which Lender.may satisfy by
payment of the taxes, assessments, and insurance premiums required to be paid by Trustor as they become due. Lender shall have the
right to draw upon the reserve funds to pay such items, and Lender shall not be required to determine the validity or accuracy of any item
before paying it. Nothing iri the Deed of Trust shall be construed as requiring Lender to advance other monies for such purposes, and
Lender shall not incur any liability for anything it may do or omit to do with respect to the reserve account. Subject to any limitations set .
by applicable law, if the reserve fuhds disclose a shortage or deficiency, Trustor shall pay such shortage or deficiency as required by
Lender. All amounts in the reserve account are hereby pledged to further secure the Indebtedness, and Lender is hereby authorized to
withdraw and apply such amounts on the Indebtedness upon the occurrence of an Event of Default. Lender shall not be required to pay
any interest or earnings on the reserve funds unless required by law or agreed to by Lender in writing. Lender does not hold the reserve
funds in trust for Trustor, and Lender is not Trustor's agent for payment of the taxes and assessments required to be paid by Trustor.
LENDER'S EXPENDITURES. If any action or proceeding is commenced that would materially affect Lender's interest in the Property or if
Trustor fails to comply with any provision of this Deed of Trust or any Related Documents, including but not limited to Trustor's failure to
discharge or pay when due any amounts Trustor is required to discharge or pay under this Deed of Trust or any Related. Documents, Lender
on Trustor's behalf may (but shall not be obligated to) take any action that Lender deems appropriate, including but not limited to
discharging or paying all taxes, liens, security interests, encumbrances and other claims, at any time levied or placed on the Property and
paying all costs for insuring, maintaining and preserving the Property. All such expenditures incurred or paid by Lender for such purposes
will then bear interest at the rate charged under the Note from the date incurred. or paid by .Lender to the date of repayment by Trustor. Ali
such expenses will become a part of the Indebtedness and, at Lender's option, will (A) be payable on demand; (B) be added to the
balance of the Note and be apportioned among and be payable with any installment payments to become due during either (1) the term of
any applicable insurance policy; or (2) the remaining term of the Note; or (C) be treated as a balloon payment which will be due and
payable at the Note's maturity. The Deed of Trust also will secure payment of these amounts. Such right shall be in addition to all other
rights and remedies to which Lender may be entitled upon Default..
WARRANTY; DEFENSE OF TITLE. The following provisions relating to ownership of the Property are a part of this Deed of Trust:
Title. Trustor warrants that: (a) Trustor holds good and marketable title of record to the Property in fee simple, free and clear of all
liens and encumbrances other than those set forth in the Real Property description or in any title insurance policy, title report, or final
title opinion issued in favor of, and accepted by, Lender in connection with this Deed of Trust, and (b) Trustor has the -full right,
power, and authority to execute and- deliver this Deed of Trust to Lender.
Defense of Title. Subject to the exception in the paragraph above, Trustor warrants and will forever defend the title to the Property
against the lawful claims of all persons. In the event any action or proceeding is commenced that questions Trustor's title or the
interest of Trustee or Lender under this Deed of Trust, Trustor shall defend the action at Trustor's expense. Trustor may be the
nominal party in such proceeding, but Lender shall be entitled to participate in the proceeding and to be represented in the proceeding
by, counsel of Lender's own choice, and Trustor will deliver, or cause to be delivered, to Lender such instruments as Lender may
request from time to time to permit such participation.
Compliance With Laws. Trustor warrants that the Property and Trustor's use of the Property complies with all existing applicable
laws, ordinances, and regulations of governmental authorities,
Survival of Representations and Warranties. All representations, warranties, and agreements made by Trustor in this Deed of Trust
shall survive the execution and delivery of this Deed of Trust, shall be continuing in nature, and shall remain in full force and-effect
until such time as Borrower's Indebtedness shall be paid in full.
CONDEMNATION. The following provisions relating to eminent domain and inverse condemnation proceedingsare a part of this Deed of
Trust:
Proceedings. If any eminent domain or inverse condemnation proceeding is commenced affecting the Property, Trustor shall promptly
notify Lender in writing, and Trustor shall promptly take- such steps as may be necessary to pursue or defend the action and obtain the
award. Trustor may be the nominal party in any such proceeding, but Lender shall be entitled, at its election, to participate in the
proceeding and to be represented in the proceeding by counsel of its own choice, and Trustor will deliver or cause to be delivered to
Lender such instruments and documentation as may be requested by Lender from time to time to permit such participation.
Application of Net Proceeds. If any award is made or settlement entered into in any cohdemnation proceedings affecting all or any
part of the Property or by any proceeding or purchase in lieu of condemnation, Lender may at its election, and to the extent permitted
by law, require that all or any portion of the award or settlement be applied to the Indebtedness and to the repayment of all reasonable
costs, expenses, and attorneys' fees incurred by Trustee or Lender in connection with the condemnation proceedings.
IMPOSITION OF TAXES, FEES AND CHARGES BY GOVERNMENTAL AUTHORITIES: The following provisions relatirg to governmental
taxes, fees and charges are a part of this Deed of Trust:
Current Taxes, Fees and Charges. Upon request by Lender, Trustor shall execute such documents in addition to this Deed of Trust
and take whatever other action is requested by Lender to perfect and continue Lender's lien on the Real Property. Trustor shall
reimburse Lender for all taxes, as described below, together with all expenses incurred in recording, perfecting or continuing this Deed
of Trust, including without limitation all taxes, fees, documentary stamps, and other charges for recording or registering this Deed of
Trust.
Taxes. The following shall constitute taxes to which this section applies: (1) a specific tax upon this type of Deed of Trust or upon
DEED OF TRUST
Loan No: 29332 (COntlnUed) Page 5
all or any part of the Indebtedness secured by this Deed of Trust; (2) a specific tax on Borrower which Borrower is authorized or
required to deduct from payments on the Indebtedness secured by this type of Deed of Trust; (3) a tax on this type of Deed of Trust
chargeable against the Lender or the holder of the Note; and (4) a specific tax bn all or any portion of the Indebtedness or on
payments of principal and interest made by Borrower.
Subsequent Taxes. If any tax to which this section applies is enacted subsequent to the date of this Deed of Trust, this event shall
have the same effect as an Event of Default, and Lender may exercise any or all of its available remedies for an Event of Default as
provided below unless Trustor either (1) pays the tax before it becomes delinquent, or (2) contests the tax as provided above in the
Taxes and Liens section and deposits with Lender cash or a sufficient corporate surety bond or other security satisfactory to Lender.
.SECURITY AGREEMENT; FINANCING STATEMENTS. The following provisions relating to this Deed of Trust as a security agreement are a
part of this Deed of Trust:
Security Agreement. This instrument shall constitute a Security Agreement to the extent any of the Property constitutes fixtures, and
Lender shall .have all of the rights of a secured party under the Uniform Commercial Code as amended from time to time.
Security Interest. Upon request by Lender, Trustor shall take whatever action is requested by Lender to perfect and continue Lender's
security interest in the Rents and Personal Property. Trustor shall reimburse Lender for all expenses incurred in perfecting or
continuing this security interest. -Upon default, Trustor shall not remove, sever or detach the Personal Property from the Property.
Upon default, Trustor shall assemble any Personal Property -not affixed to the Property in a manner and at a place reasonably
convenient to Trustor and Lender and make it available to Lender. within three (3) days after receipt of written demand from Lender to
the extent permitted by applicable law.
Addresses. The mailing addresses of Trustor (debtor) and Lender (secured party) from which information congerning the security
interest granted by this Deed of Trust may be obtained (each as required by the Uniform Commercial Code) are. as stated on the first
page of this Deed of Trust.
FURTHER ASSURANCES; ATTORNEY-IN-FACT. The following provisions relating to further assurances and attorney-in-fact are a partof
this Deed of Trust:
Further Assurances. At any time, and from time to time, upon request of Lender, Trustor will make, execute and deliver, or will cause
to be made, executed or delivered, to Lender or to Lender's designee, and when requested by Lender, cause to be filed, recorded,
refiled, or rerecorded, as the case may be, at such times and in such offices and places as Lender may deem appropriate, any and all
such mortgages, deeds of trust,. security deeds, security agreements, financing statements, continuation statements, instruments of
further assurance, certificates, and other documents as may, in the sole opinion of Lender, be necessary or desirable in order to
effectuate, complete, perfect; continue, or preserve (1) Borrower's and Trustor's obligations under the Note, this Deed of Trust, and
the Related Documents, and (2) the liens and security interests created by this. Deed of Trust as first and prior liens on the Property,
whether now owned or hereafter acquired by Trustor. Unless .prohibited by law or Lender agrees to the contrary in writing, Trustor
shall reimburse Lender for all costs and expenses incurred in connection with the matters referred to in this paragraph.
Attorney-in-Fact. If Trustor fails to do any of the things referred to in the preceding .paragraph, Lender may do so for and in the name
of Trustor and at Trustor's expense. For such purposes, Trustor hereby irrevocably appoints Lender as Trustor's attorney-in-fact for
the purpose of making, executing, delivering, filing, recording, and doing all other things as may be necessary or desirable, in Lender's
sole opinion, to accomplish the matters referred to in the preceding paragraph.
FULL PERFORMANCE. If Borrower and Trustor pay all the Indebtedness when due, and Trustor otherwise performs all the obligations
imposed upon Trustor under this Deed of Trust, Lender-shall execute and deliver to Trustee a:request for full reconveyance and shall
execute and deliver to Trustor suitable statements of termination of any financing statement on file evidencing Lender's security interest in
the Rents and the Personal Property. Lender may charge Trustor a reasonable reconveyance fee at the time of reconveyance.
EVENTS OF DEFAULT. Each of the following, at Lender's option, shall constitute an Event of Default under this Deed of Trust:
Payment Default. Borrower fails to make any payment when due under the Indebtedness.
Other Defaults. Borrower or Trustor fails to comply with or to perform any other term, obligation, covenant or condition contained in
this Deed of Trust or in any of the Related Documents or to comply with or to perform any term, obligation, covenant or condition
contained in any other agreement between Lender and Borrower or Trustor.
Compliance Default. Failure to comply with any other term, obligation, covenant or condition contained in this Deed of Trust, the Note
or in any of the Related Documents.
Default on Other Payments. Failure of Trustor withih the time required by this Deed of Trust to make any' payment for taxes or
insurance, or any other payment necessary to prevent filing of or to effect discharge of any lien.
Default in Favor of Third Parties. Should Borrower or any Grantor default under any loan, extension of credit; security agreement,
purchase or sales agreement, or any other agreement, in favor of any other creditor or person that may materially affect any of
Borrower's or any Grantor's property or Borrower's ability to repay the Indebtedness or Borrower's or Grantor's ability to perform their
respective obligations under this Deed of Trust or any of the Related Documents.
False Statements. Any warranty, representation or statement made or furnished to Lender by Borrower or Trustor or on Borrower's or
Trustor's behalf under this Deed of Trust or the Related Documents is false or misleading in any material respect, either now or at the
time made or furnished or becomes false or misleading at any time thereafter.
Defective Collateralization. This Deed of Trust or any of the Related Documents ceases to be in full force and effect (including failure
of any collateral document to create a valid and perfected security interest or lien) at any time and for any reason.
Insolvency. The dissolution or termination of Borrower's or Trustor's existence as a going business, the insolvency of Borrower or
Trustor, the appointment of a receiver for any part of Borrower's or Trustor's property, any assignment for the benefit of creditors,
any type of creditor workout, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against
Borrower or Trustor.
DEED OF TRUST
Loan No: 29332 (COlltlf!1Ued~ Page 6
Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower or Trustor or by any governmental agency against any property
securing the Indebtedness. This includes a garnishment of any of Borrower's or Trustor's accounts, including deposit accounts, with
Lender. However, this Event of Default shall not apply if there is a good faith dispute by Borrower or Trustor as to the validity or
' reasonableness of the claim which is the basis of the creditor or forfeiture proceeding and if Borrower or Trustor gives .Lender written
notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture
proceeding, in an amount determined by Lender, in its sole discretion, as being an adequate reserve or bond for the dispute.
Breach of Other Agreement. Any breach by Borrower or Trustor under the terms of any other agreement between Borrower or
Trustor and Lender that is not remedied within any grace period provided therein, including without limitation any agreement
concerning any indebtedness or other obligation of Borrower or Trustor to Lender, whether existing now or later.
Events Affecting Guarantor. Any of the preceding events occurs with respect to any guarantor, endorser, surety, or accommodation
party of any of the Indebtedness or any guarantor, endorser, surety, or accommodation party dies or becomes incompetent, or
revokes or disputes the validity of, or liability under, any Guaranty of the Indebtedness.
Adverse Change. A material adverse change occurs in Borrower's or Trustor's financial condition, or Lender believes the prospect of
payment or performance of the Indebtedness is impaired.
Right to Cure. If any default, other than a default in payment is curable and if Trustor has not been given a notice of a breach of the
-same provision of this Deed of Trust within the preceding twelve (12) months, it may be cured if Trustor, after receiving written notice
from Lender demanding cure of such default: (1) cures the default within fifteen (15) days; or (2) if the cure requires more than
fifteen (15) days, immediately initiates steps which Lender deems in Lender's sole discretion to be sufficient to cure, the default and
thereafter continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as reasonably
practicaC
RIGHTS AND REMEDIES ON DEFAULT. If an Event of Default occurs under this Deed of Trust, at any time thereafter, Trustee or Lender
may exercise any one or more of the following rights and remedies:
Election of Remedies. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make
expenditures or to take action to perform an obligation of Trustor under this Deed of Trust, after Trustor's failure to perform, shall not
affect Lender's right to declare a default and exercise its remedies.
Foreclosure by Sale. Upon an Event of Default under this Deed of Trust, Beneficiary may declare the entire Indebtedness secured by
this Deed of Trust immediately due and payable by delivery to Trustee of written declaration of default and demand. for sale and of
written notice of default and of election to cause to be sold the Property, -which notice Trustee shall cause to be filed for record.
Beneficiary also shall deposit with Trustee this Deed of Trust, the Note, other documents requested by Trustee, and all documents
evidencing expenditures secured hereby. After the lapse of such time as may then be required by law following the recordation of the
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 the notice of sale, either as a whole or in separate parcels, and in such order as it may
determine, at public auction to the highest bidder for cash 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 in ,accordance with
applicable law. Trustee shall deliver to such purchaser its deed conveying the Property so sold, but without any covenant or
warranty, express or implied. The recitals in such deed of any matters or facts shall be conclusive proof of the truthfulness thereof.
Any person, including Trustor, Trustee or Beneficiary may purchase at such sale. After deducting all costs, fees and expenses of
Trustee and of this Trust, including cost of evidence of title in connection with sale, Trustee shall apply the proceeds of sale to
payment of: all sums expended under the terms hereof, not then repaid, with accrued interest at the amount allowed by law in effect
at the date hereof; all other sums then secured hereby; and the remainder, if any, to the person or persons legally entitled thereto.
Judicial Foreclosure. With respect to all or any part of the Real Property; Lender shall have the right ih lieu of foreclosure by power of
sale to foreclose by judicial foreclosure in accordance with and to the full extent provided by California law.
UCC Remedies. With respect to all or any part of the Personal Property, Lender shall have all the rights and remedies of a secured
party under the Uniform Commercial Code, including without limitation the right to recover any deficiency in the manner and to the full
extent provided by California law.
Collect Rents. Lender shall have the right, without notice to Borrower or Trustor to take possession of and manage the Property and
collect the Rents, including amounts past due and unpaid, and apply the net proceeds, over and above Lender's costs, against the
Indebtedness. In furtherance of this right, Lender may require any tenant or other user of the Property to make payments of rent or
use fees directly to Lender. If the Rents are collected by Lender, then Trustor irrevocably designates Lender as Trustor's
attorney-in-fact to endorse instruments received in payment thereof in .the name of Trustor and to negotiate the same and collect the
proceeds.. Payments by tenants or other users to Lender in response to Lender's demand shall satisfy the obligations for which the
payments are made, whether or not any proper grounds for the demand- existed. Lender may exercise its rights under this
subparagraph either in person, by agent, or through a receiver.
Appoint Receiver. Lender shall-have the right to have a receiver appointed to take possession of all or any part of the Property, with
the power to protect and preserve the Property, to operate the Property preceding foreclosure or sale, and to collect the Rents from
the Property and apply the proceeds, over and above the cost of the receivership, against the Indebtedness. The receiver may serve
without bond if permitted by law. Lender's right to the appointment of a receiver shall exist whether or not the apparent value of the
Property exceeds the Indebtedness by a substantial amount. Employment by Lender shall not disqualify a person from serving as a
receiver.
Tenancy at Sufferance. If Trustor remains in possession of the Property after the Property is sold as provided above or Lender
otherwise becomes entitled to possession of the Property upon default of Borrower or Trustor, Trustor shall become a tenant at
sufferance of Lender or the purchaser of the Property and shall, at Lender's option, either (1) pay a reasonable rental for the use of
the Property, or (2) vacate the Property immediately upon the demand of Lender.
DEED OF TRUST
Loan No: 29332 (COntlnUed) Page 7
Other Remedies. Trustee or Lender shall have any other right or remedy provided in this Deed of Trust or the Note or available at law
or in equity.
Notice of Sale. Lender shall give Trustor reasonable notice of the time and place of any public sale of the Personal Property or of the
time after which .any private sale or other intended disposition of the Personal Property is to be made. Reasonable notice shall mean
notice given of least ten (10) days before the time of the sale or disposition. Any sale of the Personal Property may be made in
conjunction with any sale of the Real Property.
Sale of the Property. To the extent permitted by applicable law, Borrower and Trustor hereby waives any and all rights to have the
Property marshalled. In exercising its rights and remedies, the Trustee or Lender shall be free to sell all or any part of the Property
together or separately, in one sale or by separate sales. Lender shall be entitled to bid at any public sale on all or any portion of the
Property.
Attorneys' Fees; Expenses. If Lender institutes any suit or action to enforce any of the terms of this Deed of Trust, Lender shall be
entitled to recover such sum as the court may adjudge reasonable as attorneys' fees at trial and upon any appeal. Whether or not any
court action is involved, and to the extent not prohibited by law, all reasonable expenses Lender incurs that in Lender's opinion are
necessary at any time for the protection of its interest or the enforcement of its rights shall become a part of the Indebtedness payable
on demand and shall bear interest at the Note rate from the date of the expenditure until repaid. Expenses covered by this paragraph
include, without limitation, however subject to any limits under applicable law, Lender's attorneys' fees and Lender's legal expenses,
whether or not there is a lawsuit, including attorneys' fees and expenses for bankruptcy proceedings (including efforts to modify or
vacate any automatic stay or injunction), appeals, .and any anticipated post-judgment collection services, the cost of searching
records, obtaining title reports (including foreclosure reports), surveyors' reports, and appraisal fees, title insurance, and fees for the
Trustee, to the extent permitted by applicable law. Trustor also will pay any court costs, in addition to all other sums provided by
law.
Rights of Trustee. Trustee shall have all of the rights and duties of Lender as set forth in this section.
POWERS AND OBLIGATIONS OF TRUSTEE. The following provisions relating to the powers and obligations of Trustee are part of this.
Deed of Trust:
Powers of Trustee. In addition to all powers of Trustee arising as a matter of law, Trustee shall have the power to take the following
actions with respect to the Property upon the written- request of Lender and Trustor: (a) join ih preparing and filing a map or plat of
the Real Property, including the dedication of streets or other rights to the public; (b) join in granting any easement or creating any
restriction on the Real Property; and (c) join in any subordination or other agreement affecting this Deed of Trust or the interest of
Lender under this Deed of Trust.
.Obligations to Notify. Trustee shall not be obligated to notify any other party of a pending sale under any other trust deed or lien, or
of any action or proceeding in which Trustor, Lender, or Trustee shall be a party, unless the action or proceeding is brought by
.Trustee.
Trustee. Trustee shall meet all qualifications required for Trustee .under applicable law. In addition to the rights and remedies set
forth above, with respect to all or any part of the Property, the. Trustee shall have the right to foreclose by notice and sale, and Lender
shall have the right to foreclose by judicial foreclosure, in either case in accordance with and to the full extent provided by applicable
law.
Successor Trustee. Lender, at Lender's option, may from-time to time appoint a successor~Trustee to any Trustee appointed under
this Deed of Trust by an instrument executed and acknowledged by Lender and recorded in the office of the recorder of Los Angeles
County, State of California. The instrument shall contain, in addition to all other matters required by state law, the names of the
original Lender, Trustee, and Trustor, the book and page where this Deed of Trust is recorded, and the name and address of the
successor trustee, and the instrument shall be executed and acknowledged by Lender or its successors in interest. The successor
trustee, without conveyance of the Property, shall succeed to all the title, power, and duties conferred upon the Trustee in this Deed
of Trust and by applicable law. This procedure for substitution of Trustee shall govern to the exclusion of all other provisions for
substitution.
Acceptance by Trustee. Trustee accepts this Trust when-this Deed of Trust, duly executed and acknowledged, is made a public
record as provided bylaw.
NOTICES. Any notice required to be given under this Deed of Trust shall be given in writing, and shall be effective when actually delivered,
when actually received by telefacsimile (unless otherwise required by law), when deposited with a nationally recognized overnight courier,
or, if mailed, when deposited in the United States mail, as first class, certified or registered mail postage prepaid, directed to the addresses
shown near the beginning of this Deed of Trust. Trustor requests that copies of any notices of default and sale be directed to Trustor's
address shown near the beginning of this Deed of Trust. All copies of notices of foreclosure from the holder of any lien which has priority
over this Deed of Trust shall be sent to Lender's address, as shown near the beginning of this Deed of Trust. Any party may change its
address for notices under this Deed of Trust by giving formal written notice to the other parties, specifying that the purpose of the notice is
to change the party's address. For notice purposes, Trustor agrees to keep Lender informed at all times of Trustor's current address.
Unless otherwise provided or required by law, if there is -more than one Trustor, any notice given by Lender to any Trustor is deemed to be
notice given to all Trustors. `
STATEMENT OF OBLIGATION FEE. Lender may collect a fee, not to exceed the maximum amount permitted bylaw, for furnishing the
statement of obligation as provided by Section 2943 of the Civil Code of California.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Deed of Trust:
Amendments. This Deed of Trust, together with any. Related Documents, constitutes the entire understanding and agreement of the
parties as to the matters set forth in this Deed of Trust. No alteration of or amendment to this Deed of Trust shall be effective unless
given in writing and signed by the party or parties sought to be charged or bound by the alteration or amendment.
Annual Reports. If the Property is used for purposes other than Trustor's residence, Trustor shall furnish to Lender, upon request, a
DEED OF TRUST
Loan No: 29332 (COntlnUed) Page 8
certified statement of net operating income received from the Property during Trustor's previous fiscal year in such form and detail as
Lender shall require. "Net operating income" shall mean all cash receipts from the Property less all cash expenditures made in
connection with the operation of the Property.
Caption Headings: Caption headings in this Deed of Trust are for convenience purposes only and are not to be used to iriterpret or
define the provisions of this Deed of Trust.
Merger. There shall be no merger of the interest or estate created by this Deed of Trust with any other interest or estate in the
Property at any time held by or for the benefit of Lender in any capacity, without the written consent of Lender.
Governing Law. This Deed of Trust will be governed by federal law applicable to Lender and, to the extent not preempted by federal
law, the laws of the State of California without regard to its conflicts of law provisions. This Deed of .Trust has been accepted by
Lender in the State of California
Joint and Several Liability. All obligations of Borrower and Trustor under this Deed of Trust shall be joint and several, arid all
references to Trustor shall mean each and every Trustor, and all references to Borrower shall mean each and every Borrower. This
means that each Trustor signing below is responsible for all obligations in this Deed of Trust. Where any one or more of the parties is
a corporation, partnership, limited liability company or similar entity, it is not necessary for Lender to inquire into the powers of any of
the officers, directors, partners, members, or other agents acting or purporting to act on the entity's behalf, and any obligations made
or created in reliance upon the professed exercise of such powers shall be guaranteed under this Deed of Trust.
No Waiver by Lender. Lender shall not be deemed to have waived any rights under this Deed of Trust unless such waiver is given in
writing and signed by Lender. No delay or omission on the -part of Lender in exercising any right shall operate as a waiver of such
right or any other right. A waiver by Lender of a provision of this Deed of Trust shall not prejudice or constitute a waiver of Lender's
right otherwise to demand strict compliance with that provision or any other provision of this Deed of Trust. No prior waiver by
Lender, nor any course of dealing between Lender and Trustor, shall constitute a waiver of any of Lender's rights or of any of
Trustor's obligations as to any future transactions. Whenever the consent of Lender is required under this Deed of Trust, the granting
of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is
required and in all cases such consent may be granted or withheld in the sole discretion of Lender.
Severability. If a court of competent jurisdiction finds any provision of this Deed of Trust to be illegal, invalid, or unenforceable as to
any circumstance, that finding shall hot make the offending provision illegal, invalid, or unenforceable as to any other circumstance. If
feasible, the offending provision shall be considered modified so that it becomes legal, valid and ehforceable. If the- offending
provision cannot be so modified; it shall be considered deleted from this Deed of Trust. Unless otherwise required. by law, the
illegality, invalidity, or unenforceability of any provision of this Deed of Trust shall not affect the legality, validity or enforceability of
any other provision of this Deed of Trust.
Successors and Assigns. Subject to any limitations stated in this Deed of Trust on transfer of Trustor's interest, this Deed of Trust
shall be binding upon and inure to the benefit of the parties, their successors and assigns. If ownership of the Property becomes
vested in a person other than. Trustor, Lender, without notice to Trustor, may deal with Trustor's successors with reference to this
Deed of Trust and the Indebtedness by way of forbearance or extension without releasing Trustor from the obligations of this Deed of
Trust or liability under the Indebtedness.
Time is of the Essence. Time is of the essence in the performance of this Deed of Trust.
Waive Jury. To the extent permitted by applicable law, all parties to this Deed of Trust hereby waive the right to any jury trial in any
action, proceeding, or counterclaim brought by any party against any other party.
DEFINITIONS. The following capitalized words and terms shall have the following meanings when used in this Deed of Trust. Unless
specifically stated to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America.
Words and terms used in the singular shall include the plural, and the plural shall include the singular, as the context may require. Words
grid terms not otherwise defined in this Deed of Trust shall have the meanings attributed to such terms in the Uniform Commercial Code:
Beneficiary. The word "Beneficiary" means East West Bank, and its successors and assigns.
Borrower. The word "Borrower" means City of Vernon, a Municipal Corporation and includes all co-signers and co-makers signing the
Note and all their successors and assigns.
Deed of Trust. The words "Deed of Trust" mean this Deed of Trust among Trustor, Lender, and Trustee, and includes without
limitation all assignment and security interest provisions relating to the Personal Property and Rents.
Default. The word "Default" means the Default set forth in this Deed of Trust in the section titled "D,efault".
Environmental Laws. The words "Environmental Laws" mean any and all state, federal and local statutes, regulations and ordinances
relating to the protection of human health or the environment, including without limitation the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq. ("CERCLA"), the Superfund
Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499 ("SARA"), the Hazardous Materials Transportation Act, 49 U.S.C.
Section 1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., Chapters 6.5 through 7.7 of
Division 20 of the California Health and Safety Code, Section 25100; et seq., or other applicable state or federal laws, rules, or
regulations adopted pursuant thereto.
Event of Default. The words "Event of Default" mean any of the events of default set forth in this Deed of Trust in the events of
default section of this Deed of Trust.
Guaranty. The word "Guaranty" means the guaranty from guarantor, endorser, surety, or accommodation party to Lender, including
without limitation a guaranty of all or part of the Note.
Hazardous Substances. The words "Hazardous Substances" .mean materials that, because of their quantity, concentration or
physical, chemical or infectious characteristics, may cause or pose a present or potential hazard to human health or the environment
when improperly used, treated, stored, disposed of, generated, manufactured, transported or otherwise handled. The words
DEED OF TRUST
Loan No: 29332 (COntlnUed) Page 9
"Hazardous Substances" are used in their very broadest sense and include without limitation any and all hazardous or toxic
substances, materials or waste as defined by or listed under the Environmental Laws. The term "Hazardous Substances" also
includes, without limitation, petroleum and petroleum by-products or any fraction thereof and asbestos.
Improvements. The word "Improvements" means all existing and future improvements, buildings, structures, mobile homes affixed on
the Real Property; facilities, additions, replacements and other construction on the Real Property.
Indebtedness. The word "Indebtedness"-means all principal, interest, and other amounts,. costs and expenses payable under the Note
or Related Documents, together with all renewals of, extensions of, modifications of, consolidations of and substitutions for the Note
or Related Documents and any amounts expended or advanced by Lender to discharge Trustor's obligations or expenses incurred by
Trustee or Lender to enforce Trustor's obligations under this Deed of Trust, together with interest on such amounts as provided in this
Deed of Trust.
Lender. The word "Lender" means East West Bank, its successors and assigns.
Note. -The word "Note" means the promissory note dated May 7, 2009, In the original principal amount of
$6,370,000.00 from Borrower to Lender, together with all 7enewals of, extensions of, modifications of, refinancings of,
consolidations of, and substitutions for the promissory note or agreement. NOTICE TO TRUSTOR: THE NOTE CONTAINS A ,
VARIABLE INTEREST RATE.
Personal Property. The. words "Personal Property" mean all equipment, fixtures, and other articles of personal property now or
hereafter owned by Trustor, and now or hereafter attached or affixed to the Real Property; together with all accessions, parts, and
additions to, all replacements of, and all substitutions for, any of such property; ,and together with all proceeds (including without
limitation all. insurance proceeds and refunds of premiums) from any sale or other disposition of the Property.
Property. The word "Property" means collectively the Real Property and the Personal Property.
Real Property. The words "Real Property" mean the real property, interests and rights, as further described in this Deed of Trust.
Related Documents. The words "Related Documents" mean all promissory notes, credit agreements, loan agreements, security
agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements and documents,
whether now or hereafter existing, executed in connection with the- Indebtedness; except that the words do not mean any guaranty.or
environmental agreement, whether how or hereafter existing, executed in connection with the Indebtedness.
Rents. The word "Rents" means all present and future leases, rents, revenues, income, issues, royalties, profits, and other benefits
derived from the Property together with the cash proceeds of the Rehts.
Trustee. The word "Trustee" means EAST WEST INVESTMENT INC., A CALIFORNIA CORPORATION ,whose address is 9300 Flair
Drive, 6th Floor, EI Monte, CA 91731 and any substitute or successor trustees..
Trustor.- The word "Trustor" means City of Vernon, A Body Corporate And Politic.
TRUSTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS DEED OF TRUST, AND TRUSTOR AGREES TO ITS TERMS,
INCLUDING THE VARIABLE RATE PROVISIONS OF THE NOTE SECURED BY THIS DEED OF TRUST.
TRUSTOR:
CITY OF VERNON, A BODY CORPORATE AND POLITIC
Hilario Gonzales, Mayor f City of Vernon, A Body Corporate And Politic
5 i it v
' f
1
s'a
AGREEMENT TO PROVIDE INSURANCE
Pr1n*rt ~o~~ri Qa~e Matt?lr~ L~a~i.:N:p';;.::::;;':::;:,:::c~~~.t:~an.. > ACi;oun'~: < flffic~r Irr#~i~IS
' 3'T4. ~t3R.!~0. p'~.?i)flJ ' fl~~k1~~~94'::::> `<>~93~~< .~;'t.7i1 ` :
References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing. has been omitted due to text length limitations.
BOrrOW01': City of Vernon, a Municipal Corporation Lendet': East West Bank
4305 Santa Fe Avenue Loan Servicing Department
Vernon, CA 90058 9300 Flair Drive
EI Monte, CA 91731
Grantor: City of Vernon, A Body Corporate And Politic
4305 Santa Fe Avenue
Vernon, CA 90058
INSURANCE REQUIREMENTS. Grantor, City of Vernon, A Body Corporate And Politic ("Grantor"), understands that insurance coverage is
required in connection with the extending of a loan or the providing of other financial accommodations to City of Vernon, a Municipal
Corporation ("Borrower") by Lender. These requirements are set forth in the security documents for the loan. The following minimum insurance
coverages must be provided on the following described collateral (the "Collateral"):
Collateral: 4855 East 52nd Place, Vernon, CA 90058-5507.
Type: Fire and extended coverage.
Amount: Full Insurable:Value; however in ho event greater than the value of the replacement cost of the improvements.
Basis: Replacement value.
Endorsements: Standard mortgagee's clause with stipulation -that coverage will not be cancelled or diminished without a
minimum of 30 days prior written notice to Lender,. and without disclaimer of the insurer's liability for failure to give such
notice.
Comments: Lender's Loss Payable Endorsement to read: East West Bank, its successors and/or assigns, at P.O. Box 60021,
City of Industry, CA 91716-0021.
Deductibles: $50,000.00.
. Latest Delivery Date: By the loan closing date.
INSURANCE COMPANY. Grantor may obtain insurance from any insurance company .Grantor may choose that is reasonably acceptable to
Lender. Grantor understands that credit may not be denied solely because insurance was not purchased "through Lender.
FLOOD INSURANCE. Flood Insurance for the Collateral securing this loan is described as follows:
Real Estate at 4855 East 52nd Place, Vernon, CA 90058-5507.
The Collateral securing this loan is not currently located in an area identified as having special flood hazards. Therefore, no special flood
hazard insurance is necessary at this time. Should the Collateral at any time be deemed to be located in an area designated by the Director
of the Federal Emergency Management Agency as a special flood hazard area, Grantor agrees to obtain and maintain Federal Flood
Insurance, if available, within 45 days after notice is given by Lender that the Collateral is located in a special flood hazard area; for the full
unpaid principal balance of the loan and any prior liens on the property securing the loan, up to the maximum policy limits set under the
National Flood Insurance Program, or as otherwise required by Lender, and to maintain such insurance for 4he term of the loan. Flood
insurance may be purchased under the National Flood Insurance Program or from private insurers.
INSURANCE MAILING ADDRESS. All documents and other materials relating to insurance for this loan should be mailed, delivered or directed to
the following address:
East West Bank
Loan Service Department -Insurance
P.O. Box 60021
City of Industry, CA 91716-0021
HAZARDOUS INSURANCE DISCLOSURE. Lender has advised us that it is not permitted under California law to require a borrower, as a
condition of receiving or maintaining a loan secured by real property, to provide hazard insurance coverage against risks to the improvements on
that real property (such as fire and other peril) in an amount exceeding the replacement value of the improvements on the property.
FAILURE TO PROVIDE INSURANCE. Grantor agrees to deliver to Lender, on the latest delivery date stated above, evidence of the required
insurance as provided above, with an effective date of May 7, 2009, or earlier. Grantor acknowledges and agrees that if Grantor fails to provide
any required insurance or fails to continue such insurance in force, Lender may do so at Grantor's expense as provided in the applicable security
document. The cost of any such insurance, at the option of Lender, shall be added to the indebtedness as provided in the security document.
GRANTOR ACKNOWLEDGES THAT IF LENDER SO PURCHASES ANY SUCH INSURANCE, THE INSURANCE WILL PROVIDE LIMITED
PROTECTION. AGAINST PHYSICAL DAMAGE TO THE COLLATERAL,- UP TO AN AMOUNT EQUAL TO THE LESSER OF (1) THE UNPAID
BALANCE OF THE DEBT, EXCLUDING ANY UNEARNED FINANCE CHARGES, OR (2) THE VALUE OF THE COLLATERAL; HOWEVER,
GRANTOR'S EQUITY IN THE COLLATERAL MAY NOT 8E INSURED. IN ADDITION, THE INSURANCE MAY NOT PROVIDE ANY PUBLIC
LIABILITY OR PROPERTY DAMAGE INDEMNIFICATION AND MAY NOT MEET THE REQUIREMENTS OF ANY FINANCIAL RESPONSIBILITY
LAWS.
AUTHORIZATION. For purposes of insurance coverage on the Collateral, Grantor authorizes Lender to provide to any person (including any
insurance agent or company) all information Lender deems appropriate, whether regarding the Collateral, the loan or other financial
accommodations, or both.
AGREEMENT TO PROVIDE INSURANCE
Loan No: 29332. (COntlhUed~ Page 2
GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS AGREEMENT TO PROVIDE INSURANCE AND AGREES TO ITS
TERMS. THIS AGREEMENT IS DATED MAY 7, 2009.
GRANTOR:
CITY OF VERNON, A~BOI_D_Y_ CORPORATE AND POLITIC
~t ilano Gonzales, May of City of Vernon, A Body
Corporate And Politic
FOR LENDER USE ONLY
DATE: INSURANCE VERIFICATION PHONE
AGENT'S NAME:
AGENCY:
ADDRESS:
INSURANCE COMPANY:
POLICY NUMBER:
EFFECTIVE DATES:
COMMENTS:
- IASER PRO Lantling, Ver. 5.44.00.002 Copr. Rarlentl Pinenclel Solutions, Inc. 1987, 2888. All Rights Reserved. ~ CA G:WPPS\EW9CFI1CFI1LPL1Rg.FC Tft-91J3 PR-1
-
DISBURSEMENT REQUEST AND AUTHORIZATION
Prinsip~l Lty~tri Qat$ Ma~trlritY» ` ::4c~an Nq call t c~u Acc~u~t.. ~~~r ::~~ifidlS,
ooo.av ' a5 are-~~o~:.: a~ .v.~-~±~~.~.
_
References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing."~~~" has been omitted due to text length limitations.
BOrroWer: City of Vernon, a Municipal Corporation Lender: East West Bank
4305 Santa Fe Avenue Loan Servicing Department
Vernon, CA 90058 9300 Flair Drive
EI Monte, CA 91731
LOAN TYPE. This is a Variable Rate Nondisclosable Loan to a Corporation for $6,370,000.00. due on April 1, 2014.
PRIMARY PURPOSE OF LOAN. -The primary purpose of this loan is for:
? Personal, Family, or Household Purposes or Personal Investment.
® Business (Including Real Estate Investment).
SPECIFIC PURPOSE. The specific purpose of this loan is: To payoff existing East West Bank sub note #2921.8-5.
REAL ESTATE DOCUMENTS. If any party to this transaction is granting a security interest in any real property to Lender and City of Vernon, a
Municipal Corporation is not also a party to the -real estate document or documents (the "Real Estate Documents") grahting such security
interest; Borrower agrees to perform and comply with the Real Estate Documents just as if Borrower has signed as a direct and original party to
the Real Estate Documents. This means Borrower agrees to all the representations and warranties made in the Real Estate Documents. In
addition, Borrower agrees to perform and comply strictly with all the terms, obligations and covenants to be performed by either Borrower or
any Grantor or Trustor, or both, as those words are defined in the Real Estate Documents. Lender need not tell Borrower about any action or
inaction Lender takes in connection with the Real Estate Documents. Borrower assumes the responsibility for being and keeping informed about
the property. Borrower also waives any defenses that may arise because of any action or inaction of Lender, including without limitation any
failure of Lender to realize upon the property, or any delay by Lender in realizing upon the property..
FLOOD INSURANCE. As reflected on Flood Map No. 06037C1810F dated 09-26-2008, for the community of Vernon, some of the property that
will secure the loah is not located in an area that has been identified by the Director of the Federal Emergency Management Agency as an area
.having special flood hazards. Therefore, although flood insurance may be available for the property, no special flood hazard insurance protecting
property not located in an area having special flood hazards is required by law for this loan at this time.
DISBURSEMENT INSTRUCTIONS. Borrower understands that no loan proceeds will be disbursed until all of Lender's conditions for making the
loan have been satisfied. Please disburse the loan proceeds of $6,370,000.00 as follows:
Other Disbursements: $6,370,000.00
$6,370,000.00 To payoff East West Bank subnote
#29218/00005
Note Principal: $6,370,000.00
CHARGES PAIDlN CASH. Borrower has paid or will pay in cash as agreed the following charges:
Prepaid Finance Charges Paid in Cash: $86,381.06
$63,700.00 Loan Fee
$4.00 Life of Loan Flood Fee
$500.00 Processing Fee
$59.00 Tax Service Fee
$22,118.06 Prepaid Interest (deductfirom
Interest Reserve Account)
Other Charges Paid in Cash: $1,634,409.00
$5,000.00 Title Insurance Fee (estimate)
$9.00 Initial Flood Certification Fee
$150.00 Recording Fee
$7,750.00 Appraisal Fee
$1,500.00 Documentation Fee
$190,000.00 Deposit to Interest Reserve Account#80359722
$1,430,000.00 Principal paydown on subnote #29219-5
Total Charges Paid in Cash: $1,720,790.06
AUTOMATIC PAYMENT. Borrower hereby authorizes Lender automatically to deduct from Borrower's account .number, in the
amount of any loan payment. Borrower understands-the automatic transfer will take place with Borrower's payment schedule; and will occur
each month until the loah is fully paid. Automatic transfer will not take place if Borrower's loan is delinquent. The transfer will be reversed if
there are insufficient funds in the designated account and a service charge of $18.00 will be assessed on the loan. The authorization will
remain in effect until East West Bank receives written notice of cancellation (10 day advance notice required), or upon East West Bank's ten day.
advance notice of termination.
.EXPIRATION OF LOAN DOCUMENTS. The offer represented by these Loan Documents expires if the Borrower does not sign and return all Loan
Documents to the Lender within 0 da s of the date of the Loan Documents.
INTEREST RESERVE. Lender and Borrower have agreed to deposit $190,000.00 an Interest Reserve Fund (Account # 80359722) for payment
of interest. Pursuant to the interest payment schedule outlined in the Loan Documents, Lender will advance funds from this Interest Reserve
DISBURSEMENT REQUEST AND AUTHORIZATION
Loan No: 29332 (ContlnUed) Page 2
Fund to keep interest payments current. Should the funds aside in the Interest Reserve Fund be completely disbursed, Borrower agrees to
maintain the interest payments current or to replenish t e Interest Reserve Fund with sufficient funds- as required by Lender. Notwithstanding
the above, Borrower may, with notice to Lender, make interest payments directly to Lender pursuant to the interest payment schedule outlined
in the Loan Documents.
FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND WARRANTS TO LENDER THAT THE
INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN BORROWER'S
FINANCIAL CONDITION AS DISCLOSED IN BORROWER'S MOST RECENT FINANCIAL STATEMENT TO LENDER. THIS AUTHORIZATION IS
DATED MAY 7, 2009.
BORROWER:
CITY OF VERNON; A MUNICIPAgL CORPORATION
BY~ ,~~.L-eBti BY~
H~no Gonzales, M or of City of Vernon, a anuela Giron, Cit Jerk of ity of Vernon, a
Municipal Corporafo Municipal Corporation
By:
Jeff rriso ity Attorney of City of Vernon, a
Mu i i Corp ion
IASER PRO Lending, Vet.. 5.44.00.002 Copr. Harlantl Financial Solutions, Inc. 199], 2009. All RigFts Ressrved. - GA G;\APPS\EWRLFI\LFI\LPL1120.FL TR-8143 PR-i
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- L~BLY INOU
INDUSTRIAL DEVELOPMENT DEP ~rRi~uriOrv
STAFF REPORT - _ -
T
u _ ~ -
DATE: May 13, 2009
TO: Honorable Mayor and City Council
FROM: Jeff A. Harrison, Director of Industrial Developmen
RE: Staff Report - East West Bank Loan Documents-
Issue:
On September.25, 2007, the City entered into loan documents establishing a
revolving line of credit for various real estate transactions from time to
time with East West- Bank (the."Bank") for the -sum of $50 million as
evidenced by a Promissory Note dated October 1, 2007, that was to mature
on January 1, 2009, which has been extended to September 26,_2009.
One of the-sub notes,. (#29218-5), ("Subloan 3") is for property. located at
4855 East 52nd Place as evidenced by a promissory note dated on or about
March 20, 2008 for $7,800,.000.
The removal of Subloan 3 from the revolving loan-and paying off .Subloan 3
extends the due date of the loan and frees up additional money under the,
revolving line of credit for other real estate transactions..
Recommendations:
I recommend that the City payoff the existing Subloan 3 in part by
borrowing an additional loan separate from and not to be governed by the
revolving Loan Agreement, but rather by its own loan agreement documents
(Loan No. 29332) for the principal sum of $6,370,000 that matures on
April 1, 2014 and adopt a resolution authorizing the execution of the loan
documents to implement the new loan and the payoff of Subloan 3.
Fiscal Impact
Amortization of note principal of $6,370,000.00, prepaid finance charges
and. other .documentation fees of approximately $1,720,790.06 over a fifteen
(15) year period..