HomeMy WebLinkAboutC-3601(A) - Back Bay Drive, 1121 - Deed of Trust, Promisory NoteMorgan, Lewis & Bockius LLP
1 Ada, Suite 250
Irvine, CA 92618-2304
Tel: 949.453.3000
Fax: 949.453.3001
www.marganlewis.com
Jenhee Newcomb
Paralegal
949.453.3142
jenhee.newcomb@morganlewis.com
December 8, 2004
VIA FEDERAL EXPRESS
Sharon Wood, Esq.
City of Newport Beach
3300 Newport Boulevard
Newport Beach, Califomia 92660
f C-3L'ol
Morgan Lewis
COUNSELORS AT LAW
Re: $1,250.000 Loan from The City of Newport Beach to Newport Housing Partners, L.P.
Dear Sharon:
In connection with the above -referenced loan, enclosed please find one (1) executed original of the
Promissory Note.
Please acknowledge your receipt of the document by signing below and returning a copy of this letter to
my attention by fax (949-453-3001) or by email.
Please do not hesitate to contact me if you have any questions or comments.
Sincerely,
Jenhee Newcomb
Enclosure
Sharon Wood
I-IP/407849.1
PROMISSORY NOTE SECURED BY DEED OF TRUST
Principal Loan Amount: $1,250,000.00
Note Date: November 1, 2004
FOR VALUE RECEIVED, the undersigned ("Maker") hereby promises to pay to the
order of the THE CITY OF NEWPORT BEACH, a public body, corporate and politic
("Holder"), at a place designated by Holder, the principal sum of ONE MIT.T.JON TWO
HUNDRED FIEI Y THOUSAND DOLLARS AND NO CENTS ($1,250,000.00) or so much
thereof as is disbursed for the account of Maker, with simple interest from the date of
disbursement at the rate of one percent (1%) per annum. The obligation of Maker to Holder
hereunder shall be secured by a deed of trust (the "Trust Deed") made by Maker encumbering
its leasehold interest in the site to be developed (the "Site") pursuant to the Loan Agreement.
The obligation of Maker set forth in this Note is subject to acceleration as set forth in the Trust
Deed Unless expressly defined herein, all capitalized terms used herein shall have the meaning
ascribed to them in that certain Development Loan Agreement (the "Loan Agreement") dated as
of the date hereof, entered into by and between Maker and Holder.
1. City Loan. This Note evidences the obligation of Maker to Holder for the
repayment of funds loaned to Maker by Holder (the "City Loan") to finance the development of
the Property pursuant to the Loan Agreement. Except as otherwise permitted in the Loan
Agreement, Maker shall not make any sale, assignment or conveyance, or transfer in any other
form, of Maker's leasehold interest in the Property, or any part thereof, or interest therein
without the express written consent of Holder.
2. Additional Terms.
(a) Term. The term of this Note shall be fifty-seven (57) years, commencing
on the date of this Note.
(b) Repayment. Beginning on the Payment Commencement Date and
continuing on each Payment Date thereafter through the Maturity Date (as hereinafter defined),
Maker shall make a payment to Holder in accordance with Section 1.02(b) of the Loan
Agreement. Each payment shall be credited first to interest then accrued and the remainder to
principal. Principal and interest are payable in lawful money of the United States. On the fifty-
seventh (57th) anniversary date of this Note (the "Maturity Date"), all remaining unpaid
principal and interest shall immediately become due and payable.
Following an Event of Default and the expiration of the applicable notice and cure period
provided in the Loan Agreement, the whole sum of principal and interest outstanding under this
Note shall become immediately due and payable at Holder's option. Failure by Holder to
exercise this option shall not constitute a waiver of the right to exercise it in the event of any
subsequent Event of Default.
At the end of the term of this Note and discharge of this Note as set forth above, Holder
shall mark this Note "PAID IN FULL" and shall then deliver this Note to the trustee of the Trust
1-IR/407406.2
Deed that secures this Note for the trustee's delivery to Maker in conjunction with the
reconveyance of the Trust Deed.
(c) Disbursement of the City Loan.
as set forth in the Loan Agreement.
Holder shall disburse the City Loan
3. Prepayment. This Note may be prepaid in whole or in part at any time without
the payment of any prepayment penalty.
4. Acceleration of Obligation. Upon the occurrence of an uncured Event of Default
of Maker under this Note, the Trust Deed or the Loan Agreement, and the expiration of any
notice and cure period provided therein or herein, and upon thirty (30) days prior written notice
to Maker, Holder may, at its option, declare this Note and the entire outstanding indebtedness
hereby evidenced to be immediately due and payable and collectible then or thereafter as Holder
may elect, regardless of the date of maturity.
5. Default Interest. If any event occurs giving Holder the right to accelerate the
Note pursuant to Section 4 above, the entire unpaid outstanding principal owing hereunder shall,
as of the date of such Event of Default, commence to accrue interest at a rate equal to two
percentage points above the reference rate published by Bank of America, N.A., or the maximum
non -usurious interest rate permitted by law, whichever is less.
6. Collection Costs; Attorneys' Fees. If any attorney is engaged by Holder
because of any uncured Event of Default under this Note or the Trust Deed or to enforce any
provisions of either instrument, whether or not suit is filed hereon, Holder shall bear its own
attorney's fees and costs.
7. Severability. The unenforceability or invalidity of any provision or provisions of
this Note as to any persons or circumstances shall not render that provision or those provisions
unenforceable or invalid as to any other provisions or circumstances, and all provisions hereof, in
all other respects, shall remain valid and enforceable.
8. Modifications. Neither this Note nor any term hereof may be waived, amended,
discharged, modified, changed or terminated orally; nor shall any waiver of any provision hereof
be effective unless by an instrument in writing signed by Maker and Holder.
9. Usury. Notwithstanding any provision in this Note, Trust Deed or other Loan
Document, the total liability for payment in the nature of interest shall not exceed the limit now
imposed by applicable laws of the State of California.
10.. Goveming Law. This Note has been executed and delivered by Maker in the
State of California and is to be governed and construed in accordance with the laws thereof.
11. Limitations on Recourse Liability. Maker's obligations under this Promissory
Note are subject to the limitations set forth in Section 12.06 of the Loan Agreement.
1-IR/407406.2
2
IN WITNESS WHEREOF, Maker has executed this Note as of the date and year first
above written.
Dated: November 1, 2004
1-IIt/407406.2
"MAKER"
NEWPORT HOUSING PARTNERS, L.P.,
a Califomia limited liability partnership
By: Related/Newport Development Co., LLC,
a California limited liability company,
General Partner
By: The Nicholas Company, Inc.,
a Delaware corporation,
General Manager
By:
William A. Witte, President
By: Las Palmas Foundation
a California nonprofit public benefit
corporation, General Partne
3
aels, President
•
RECORDING REQUESTED EY
FIRST AMERICAN TITLE COMPANY •
NATIONAL/COMMERCIAL SERVICES.
DMSIOR
This Document a electronically recorded by
FirstWnerican Title_B
la-NSG: -EB
No fee: Recording requested pursuant
to Government Code Section 27383
Recording Requested By, and
When Recorded, Return to:
City of Newport Beach
P.O. Box 1768
Newport Beach, CA 92658
Attn: City Manager
Recorded In Official Records, Orange County
Tom Daly Clerk -Recorder
I III IIII IIII III IIII III 11I 1 IIII IHI III IIII 157.00
2004001052523• 01:30pm 11/24/04
104 27 D11 A36 16
0.00 0.00 0.00 0.00 45.00 0.00 0.00 0.00
• \xe4 tAO- D oe4
(space above this line for Recorder's use only)
DEED OF TRUST
With Assignment of Rents
THIS DEED OF TRUST (this "Deed of Trust"), is made as of this 1st day of November,
2004, by and between Newport Housing Partners, L.P., a California limited partnership (the
"Borrower"), as trustor, Commonwealth Land Title Insurance Company ("Trustee"), and the City
of Newport Beach (the "Beneficiary"), a public body, corporate and politic, as beneficiary, and is
executed to secure the obligations contained in that certain $1,250,000 Promissory Note Secured
by Deed of Trust executed by Trustor in favor of Beneficiary and dated November 1, 2004 (the
"Note").
1. GRANT IN TRUST AND PROPERTY AGREEMENT. For valuable
consideration, Trustor irrevocably grants, transfers and assigns to Trustee, in trust, with power of
sale, for the benefit of Beneficiary, the following property (the "Property"):
(a) Borrower's interest in the leasehold estate described in Attachment A attached to
this Deed of Trust and incorporated in this Deed of Trust by reference (the
"Leasehold Estate"), which Leasehold Estate covers the real property (the "Land")
described in Attachment B attached to this Deed of Trust and incorporated into
this Deed of Trust by reference; and
(b) all buildings, structures and other improvements now or in the future located or to
be constructed on the Land (the "Improvements"); and
(c) all tenements, hereditaments, appurtenances, privileges and other rights and
interests now or in the future benefiting or otherwise relating to the Land or the
Improvements, including easements, rights -of -way, development rights, mineral
rights, water rights and water stock (the "Appurtenances").
2. OBLIGATIONS SECURED. The Borrower makes this grant for the purpose of
securing the following obligations:
I-IR/40743.2 (Page 1 of 10)
Repayment of the indebtedness of the Borrower to Beneficiary under the Note, in
accordance with the terms of the Note or as much as has been disbursed to the
Borrower under the Note, along with any extensions, amendments, modifications,
or renewals to the Note; and
B. Payment of any sums advanced by Beneficiary to protect the Property and priority
of this Deed of Trust; and
C. Payment of any sums advanced by Beneficiary following a breach of the
Borrower's obligation to advance said sums and the expiration of any applicable
cure period, with interest thereon as provided herein; and
D. Performance of every obligation, covenant or agreement of the Borrower
contained in this Deed of Trust and the Note, including all modifications,
extensions and renewals of these obligations; and
E. Performance of any other obligation or repayment of any other indebtedness of the
Borrower to Beneficiary, where such evidence of obligation orindebtedness
specifically recites that it is secured by this Deed of Trust.
3. ASSIGNMENT OF RENTS AND RIGHT TO POSSESSION. As additional
security, the Borrower hereby assigns to Beneficiary: (a) all of the rents, revenues, profits, and
income from the Property, any deposits now or hereafter in the Borrower's possession which
have been collected with respect to the Property, and any reserve or capital funds now or
hereafter held by the Borrower with respect to construction or operation of the Property
(collectively, the "Rents"); and (b) the right to enter, take possession of, and manage the
Property; provided however that the Borrower shall have, before an Event of Default (as such
term is defined in the Note) the exclusive right to possess the Property and to collect Rents and
use then in accordance with the Note and all documents relating thereto. This assignment is
intended to be an absolute and present transfer of the Borrower's interest in existing, and future
Rents, effective as of the date of this Deed of Trust.
4. ENFORCEMENT. Upon the happening of an Event of Default and written
notice to the Borrower, Beneficiary may, in addition to other rights and remedies permitted by
the Note, this Deed of Trust, or applicable law, (a) enter upon, take possession of, and manage
the Property, either in person as a mortgagee -in -possession, by agent, or by a receiver appointed
by a court, and do any acts which it deems necessary or desirable to preserve the value,
marketability or rentability of the Property, (b) collect all Rents, including those past due and
unpaid, and apply the same to pay for the costs and expenses of operation of the Property,
including attorneys' fees, and pay off any indebtedness secured by this Deed of Trust, all in such
order as Beneficiary may determine, and/or (c) enter upon and take possession of the Property,
and complete construction of any improvements on the Property as provided for in the plans and
specifications prepared for the improvements. Beneficiary may make, cancel, enforce; and
modify leases and rental agreements, obtain and evict tenants, set and modify rent terms, sue for
rents due, enter into, modify, or terminate any contracts or agreements, or take any legal action,
as it deems necessary with respect to the Rents or the development or operation of the Property.
I-IR/407403.2 (Page 2 of 10)
i
5. APPOINTMENT OF A RECEIVER.. In any action to enforce this Deed of
Trust, Beneficiary may apply for the appointment of a receiver to take possession of the Property
and take whatever measures are necessary to preserve and manage the Property for the benefit of
Beneficiary and the public interest. The Borrower hereby consents to the appointment of a
receiver following the occurrence of an Event of Default. The receiver shall have all of the
authority over the Property that Beneficiary would have if Beneficiary took possession of the
Property under thisassignment as a mortgagee -in -possession, including the right to collect and
apply Rents and the right to complete construction of improvements.
6. NO WAIVER OF POWER OF SALE. The entering upon and taking
possession of the Property and the collection of Rents shall not cure or waive any default or
notice of default hereunder or invalidate any act done in response to such default or notice of
default and, notwithstanding the continuance in possession of the Property or the collection and
application of Rents, Beneficiary shall be entitled to exercise every right provided for in this
Deed of Trust or by law upon occurrence of any Event of Default, including the right to exercise
the power of sale.
COMMERCIAL CODE PROPERTY AGREEMENT
7. GRANT. This Deed of Trust is intended to be a security agreement and financing
statement pursuant to the California Commercial Code for any of the items specified above as
part of the Property which under applicable law may be subject to a security interest pursuant to
the Commercial Code, and the Borrower hereby grants Beneficiary a security interest in said
items. Beneficiary may file a copy of this Deed.of Trust in the real estate records or other
appropriate index as a financing statement for any of the items specified as part of the Property.
The Borrower shall execute and deliver to Beneficiary at Beneficiary's request any financing
statements, as well as extensions, renewals, and amendments thereof, and copies of this
instrument in such form as Beneficiary may require to perfect a security interest with respect to
said items. The Borrower shall pay all costs of filing such financing statements and shall pay all
reasonable costs of any record searches for financing statements and releases. Without the prior
written consent of Beneficiary, the Borrower shall not create or permit any other security interest
in said items.
8. REMEDIES. Upon the occurrence of an Event of Default, Beneficiary shall have
the remedies of a secured party under the Commercial Code and at Beneficiary's option may also
invoke the remedies provided for elsewhere in this Deed of Trust with respect to said items.
Beneficiary may proceed against the items of real property and personal property specified above
separately or together and in any order whatsoever.
RIGHTS AND OBLIGATIONS OF TRUSTOR
9. PERFORMANCE OF SECURED OBLIGATION. The Borrower shall
promptly perform each obligation secured by this Deed of Trust.
10. PAYMENT OF PRINCIPAL AND INTEREST. The Borrower shall promptly
pay when due the principal and interest on the indebtedness evidenced by the Note, subject to any
grace, notice and/or curative periods provided for therein.
1-IR/407403.2 - (Page 3 of 10)
11. MAINTENANCE OF THE PROPERTY. The Borrower shall, at the
Borrower's own expense, maintain and preserve the Property or cause the Property to be
maintained and preserved in good condition, in good repair, and in a decent, safe, sanitary;
habitable and tenantable condition. The Borrower shall not cause or knowingly permit any
violations of any laws, ordinances, regulations, covenants, conditions, restrictions, or equitable
servitudes as they pertain to improvements, alterations, maintenance or demolition on the
Property. The Borrower shall not commit or knowingly permit waste on or to the Property. The
Borrower shall not abandon the Property. Beneficiary shall have no responsibility over
maintenance of the Property. In the event the Borrower fails to maintain the Property in
accordance with the standards in this Deed of Trust, after at Least sixty (60) days, except in health
and safety emergencies, in which case, after at least ten (10) days prior written notice to the
Borrower, Beneficiary may, but shall be under no obligation to, make such repairs or
replacements as are necessary and provide for payment thereof. Any amount so advanced by
Beneficiary, together with interest thereon from the date of such advance at the same rate of
indebtedness as specified in the Note (unless payment of such an interest rate would be contrary
to applicable law, in which event such sums shall bear interest at the highest rate then allowed by
applicable law), shall become an additional obligation of the Borrower to Beneficiary, and shall
be secured by this Deed of Trust.
12. INSPECTION OF THE PROPERTY. The Borrower shall permit Beneficiary
to enter and inspect the Property for compliance with these obligations upon 48 hours advance
written notice of such visit by Beneficiary to the Borrower or the Borrower's management agent.
13. DEFENSE AND NOTICE OF CLAIMS AND ACTIONS. Following the
occurrence of an Event of Default, the Borrower shall appear in and defend, at its own expense,
any action or proceeding purporting to affect the Property and/or the rights of Beneficiary. The
Borrower shall give Beneficiary and Trustee prompt notice in writing of the assertion of any
claim, of the filing of any action or proceeding and of any condemnation offer or action with
respect to the Property.
14. SUITS TO PROTECT THE PROPERTY. Beneficiary shall have power to
institute and maintain such suits and proceedings as it may deem expedient (a) to prevent any
impairment of the Property or the rights of Beneficiary, (b) to preserve or protect its interest in
the Property and in the Rents, and (c) to restrain the enforcement of or compliance with any
governmental legislation, regulation, or order, if the enforcement of or compliance with such
legislation, regulation, or order would impair the Property or be prejudicial to the interest of
Beneficiary.
15. DAMAGE TO PROPERTY. The Borrower shall give Beneficiary and Trustee
prompt notice in writing of any damage to the Property. If any building or improvements erected
on the Property is damaged or destroyed by an insurable cause, the Borrower shall, at its cost and
expense (but only to the extent of available insurance proceeds), repair or restore said buildings
and improvements consistent with the original plans and specifications. Such work or repair
shall be commenced within 180 days after the damage or loss occurs and Borrower shall
diligently pursue such work or repair to completion. All insurance proceeds collected for such
damage or destruction shall be applied to the cost of such repairs or restoration.
14R/407403.2 - (Page 4 of 10)
16. TITLE. Borrower warrants that to the best of Borrower's knowledge, the
Borrower lawfully has legal title to the Leasehold Estate and Borrower has the right to encumber
• the same with the Deed of Trust.
17. GRANTING OF EASEMENTS. The Borrower may, without Beneficiary's
approval or consent, grant easements, licenses, rights -of -way or other rights or privileges in the
nature of easements with respect to the Property including those required or desirable for
installation and maintenance of public utilities including water, gas, electricity, sewer, cable
television, telephone, and those required by law.
18. TAXES AND LEVIES. The Borrower shall pay prior to delinquency, all taxes,
fees, assessments, charges and levies imposed by any public authority or utility company which
are or may become a lien affecting the Property. However, the Borrower shall not be required to
pay and discharge any such tax, assessment, charge or levy so long as (a) the legality thereof shall
be promptly and actively contested in good faith and by appropriate proceedings or Borrower has
applied for a property tax exemption under applicable law, and (b) Borrower maintains reserves
adequate to pay any contested liabilities, or Borrower causes the lien for such taxes to be insured
over by the title company insuring the lien of this Deed of Trust. In the event that the Borrower
falls to pay any of the foregoing items, Beneficiary may, but shall be under no obligation to, pay
the same, after Beneficiary has notified the Borrower in writing of such failure to pay and the
Borrower fails to fully pay such items within seven business days after receipt of such, written
notice. Any amount so advanced by Beneficiary, together with interest thereon from the date of
such advance at the same rate of indebtedness as specified in the Note (unless payment of such
interest would be contrary to applicable law, in which event such sums shall bear interest at the
highest rate then allowed by applicable law), shall become an additional obligation of the
Borrower to Beneficiary and shall be secured by this Deed of Trust.
19. CONDEMNATION. All judgments, awards of damages, settlements and
compensation made in connection with or in lieu of taking all or any part of or interest in the
Property under assertion of the power of eminent domain ("Funds") are hereby assigned to and
shall be paid to Beneficiary to the extent (but only to the extent) Beneficiary's security interest in
the Property is impaired. Beneficiary is authorized (but not required) to collect and receive any
Funds and is authorized to apply them in whole or in part upon any indebtedness or obligation
secured hereby, in such order and manner as Beneficiary shall determine in its reasonable
discretion to the extent (and only to the extent) Beneficiary's security interest in the Property is
impaired. All or any part of the amounts so collected and recovered by Beneficiary may be
released to the Borrower upon such conditions as Beneficiary may reasonably impose for its
disposition.
20. ACCELERATION ON TRANSFER OF PROPERTY; ASSUMPTION.
Except as expressly provided below, in the event that the Borrower, without the prior written
consent of the Beneficiary, sells, transfers, or conveys its interest in the Property, Beneficiary
may at its option declare all sums secured by this Deed of Trust to be immediately due and
payable. Notwithstanding the foregoing or anything stated to the contrary elsewhere in this Deed
of Trust, the following transfers and/or conveyances are expressly permitted and are not
prohibited under this Deed of Trust:
14R/4m403.2 (Page 5 of 10)
A. An assignment of Borrower's interest in the Leasehold Estate and/or the Property
to an Affiliate;
B. The syndication of limited partnership interests in Borrower;
C. Any Permitted Mortgage;
D. The leasing of any apartment units now or hereafter constructed on the Land for
occupancy;
E. Any transfer of the Leasehold Estate permitted under the ground lease described
in Attachment A attached hereto;
F. Any transfer of the Leasehold Estate or Borrower's interest in the Property to any
of the general partner(s) or managing member(s) (or their Affiliates) in Borrower
pursuant to the terms and conditions of Borrower'sagreement of limited
partnership or operating agreement following the expiration of the fifteen (15)
year tax credit compliance period under Section 42 of the Internal Revenue Code;
and
G. A transfer or pledge (for security purposes) by any of the partners in Borrower of
their respective interests in Borrower.
21. RECONVEYANCE BY TRUSTEE. This Deed of Trust is intended to continue
for the entire term of the loan evidenced by the Note. Upon written request of Beneficiary stating
that all sums secured by this Deed of Trust have been paid and upon surrender of this Deed of
Trust to Trustee for cancellation and retention, and upon payment by the Borrower of Trustee's
reasonable fees, Trustee shall reconvey the Property to the Borrower, or to the person or persons
legally entitled thereto.
DEFAULT AND REMEDIES
22. EVENTS OF DEFAULT. Any of the events listed in the Note as an Event of
Default shall also constitute an Event of Default under this Deed of Trust.
23. ACCELERATION OF MATURITY. Upon the happening of an Event of
Default which has not be cured within the times and in the manner provided in the Note,
Beneficiary may declare all sums advanced to the Borrower tinder the Note and this Deed of
Trust immediately due and payable.
24. BENEFICIARY'S REMEDIES. Upon the happening of an Event of Default
which has not be cured within the times and in the manner provided in the Note, Beneficiary
may, in addition to other rights and remedies permitted by the Note or applicable law, proceed
with any or all of the following remedies:
A. Enforce the assignment of rents and right to possession as provided for in this
Deed of Trust, and/or seek appointment of a receiver to takeover possession of
the Property and collect Rents;
1-1R/407403.2 (Page 6 of 10)
B. Enter the Property and take any actions necessary in its judgment to complete
construction on the Property as permitted in the assignment of rents and right to
possession in this Deed of Trust, either in person or through a receiver appointed
by a court;
C. Commence an action to foreclose this Deed of Trust pursuant to California Code
of Civil Procedure Sections 725a, et seq., and/or seek appointment of a receiver
from a court of competent jurisdiction with the authority to protect Beneficiary's
interests in the Property, including the authority to complete construction of
improvements;
Deliver to Trustee a written declaration of default and demand for sale, and a
written Notice of Default and election to cause the Borrower's interest in. the
Property to be sold, which notice Trustee or Beneficiary shall duly file for record
in the Official Records of Orange County, and exercise its power of sale as
provided for below; or
E. Pursue any other rights and remedies allow at law or in equity.
25. FORECLOSURE BY POWER OF SALE. Should Beneficiary elect to
foreclose by exercise of the power of sale contained in this Deed of Trust, Beneficiary shall
notify Trustee and shall deposit with Trustee this Deed of Trust, and such receipts and evidence
of any expenditures made that are additionally secured hereby as Trustee may require.
Upon receipt of such notice from Beneficiary, Trustee shall cause to be recorded,
published and delivered to the Borrower such Notice of Default and Election to Sell as then
required by law and by this Deed of Trust. Trustee shall, without demand on the Borrower, after
lapse of such time as may then be required by law and after recordation of such Notice of Default
and after Notice of Sale having been given as required by law, sell the Property, at the time and
place of sale fixed by it in said Notice of Sale, whether as a whole or in separate lots or parcels or
items as Trustee shall deem expedient and in such order as it may determine unless specified
otherwise by the Borrower, at public auction to the highest bidder for cash in lawful money of the
United States payable at the time of sale. Trustee shall deliver to the purchaser its deed or deeds
conveying the property so sold, but without any covenant or warranty, express or implied. The
recitals in such deed of any matters of fact shall be conclusive proof of the truthfulness thereof.
Any person, including, without limitation, the Borrower, Trustee, or Beneficiary, may purchase at
the sale.
Trustee may postpone the 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, and without
further notice make such sale at the time fixed by the last postponement, or may, in its discretion,
give a new Notice of Sale.
After deducting all reasonable costs, fees and expenses of Trustee, including costs of
evidence of title in connection with such sale, Trustee shall apply the proceeds of sale as follows:
(i) first, to the payment of all sums then secured by this Deed of Trust, in such order and amounts
1-PR/407403.2 (Page 7 of 10)
as Beneficiary in its sole discretion determines, and (ii) the remainder, if any, to the person or
persons legally entitled thereto.
26. REMEDIES CUMULATIVE. No right, power or remedy conferred upon or
reserved to Beneficiary by this Deed of Trust is intended to be exclusive of any other rights,
powers or remedies, but each suchright, power and remedy shall be cumulative and concurrent
and shall be in addition to any other right, power and remedy given hereunder or now or hereafter
existing at law or in equity.
GENERAL PROVISIONS
27. GOVERNING LAW. This Deed of Trust shall be interpreted under and
governed by the laws of the State of California.
28. ATTORNEYS' FEES AND COSTS. In the event of any Event of Default, or
any legal or administrative action is commenced to interpret or to enforce the terms of this. Deed
of Trust, the prevailing party in such action shall be entitled to recover all reasonable attorneys'
fees and costs in such action. Any such amounts paid by Beneficiary shall be added to the
indebtedness secured by the lien of this Deed of Trust.
29. STATEMENT OF OBLIGATION. Lender may collect a fee not to exceed the
maximum allowable under applicable law for furnishing a statement of obligations as provided in
the California Civil Code.
30. CONSENTS AND APPROVALS. Any consent or approval of Beneficiary
required under this Deed of Trust shall not be unreasonably withheld.
31. TIME. Time is of the essence in this Deed of Trust.
32. NOTICES, DEMANDS AND COMMUNICATIONS. Formal notices,
demands and communications between the Borrower and Beneficiary shall be sufficiently given
and shall not be deemed given unless dispatched by registered or certified mail, postage prepaid,
return receipt requested, or delivered personally, to the principal offices of the Borrower and
Beneficiary as follows:
Beneficiary:
City of Newport Beach
P.O. Box 1768
Newport Beach, CA 92658
Attn: City Manager
1-IR'4074032 (Page 8 of 10)
•
The Borrower:
Newport Housing Partners, L.P.
c/o Related/Newport Development Co., I IC
18201 Von Kalman Avenue, Suite 900
Irvine, CA 92612
Attn: Mr. William A. Witte
and
Las Palmas Foundation
7040 104-343
Carlsbad, CA 92009
Attn: Joseph M. Michaels
33.. BINDING UPON SUCCESSORS. All provisions of this Deed of Trust shall be
binding upon and inure to the benefit of the heirs, administrators, executors, successors -in -
interest, transferees, and assigns of the Borrower, Trustee, and Beneficiary.
34. WAIVER. Any waiver by Beneficiary of any obligation of the Borrower in this
Deed of Trust must be in writing. No waiver will be implied from any delay or failure by
Beneficiary to take action on any breach or default of the Borrower or to pursue any remedy
allowed under this Deed of Trust or applicable law. Any extension of time granted to the
Borrower to perform any obligation under this Deed of Trust shall not operate as a waiver or
release the Borrower from any of its obligations under this Deed of Trust. Consent by
Beneficiary to any act or omission by the Borrower shall not be construed to be a consent to any
other or subsequent act or omission or to waive the requirement for Beneficiary's written consent
to future waivers.
35. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications
to this Deed of Trust must be in writing, and shall be made only if mutually agreed upon by
Beneficiary and the Borrower.
36. DEFINITIONS. Capitalized terms not otherwise defined in this Deed of Trust
shall have the same meaning as defined terms in that certain Development Loan Agreement
("Loan Agreement") of even date herewith, entered into by and between Trustor and Beneficiary.
37. PROOFS OF CLAIM. In the case of any receivership, insolvency, bankruptcy,
reorganization, arrangement, adjustment, recomposition or other proceedings affecting the
Borrower, its creditors or its property, Trustee, to the extent permitted by law, shall be entitled to
file such proofs of claim and other documents as may be necessary or advisable in order to have
the claims of Beneficiary allowed in such proceedings and for any additional amount which may
become due and payableby the Borrower hereunder after such date.
38. SEVERABILITY. Every provision of this Deed of Trust is intended to be
severable. If any term or provision of this Deed of Trust is declared to be illegal. invalid, or
unenforceable by a court of competent jurisdiction all other provisions in this Deed of Trust shall
not be affected. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the
debt, or if the lien is invalid or unenforceable as to any part of the Property, the unsecured or
1-IR/4074032 - - (Page 9 of 10)
•
,partially secured portion of the debt and all payments made on the debt (whether voluntary or
under foreclosure or other enforcement action or procedure) shall be considered to have been first
paid or applied to the payment of that portion of the debt which is not secured or partially secured
by the lien of this Deed of Trust.
39. SUBSTITUTION OF TRUSTEES. Beneficiary may from time to time appoint
another trustee to act in the place and stead of Trustee or any successor. Upon such appointment
and without conveyance, the successor trustee shall be vested with all title, powers, and duties
conferred upon Trustee. Each such appointment and substitution shall be made by a written
instrument executed by Beneficiary containing reference to this Deed of Trust and its place of
record, which when duly recorded in the Orange County Office of the Recorder shall be
conclusive proof of proper appointment of the successor trustee.
40. SUBORDINATION. This Deed of Trust shall be junior and subordinate to all
Permitted Mortgages. Trustor agrees to execute such subordination agreements as may be
required from time to time to effect the priority set forth herein and as provided by the provisions
of the Loan Agreement.
41. LIMITATIONS ON RECOURSE LIABILITY. Borrower's obligations under
this Deed of Trust are subject to the limitations set forth in Section 12.06 of the Loan Agreement.
[Signatures on Attached Page]
1-W407403.2 (Page 10 of 10)
Dated: November 1, 2004
`BORROWER„
NEWPORT HOUSING PARTNERS, L.P.,
a California limited liability partnership
By:. Related/Newport Development Co., LLC,
a California limited liability company,
General Partner
By: The Nicholas Company, Inc.,
a Delaware corporatio
General Manager
By:
William A. Witte,
President
By: Las Palmas Foundation
a California nonprofit public benefit
corporation, General P
J
President
1-TR/407403.2 S-1
haels,
STATE OF
COUNTY OF Gu n9e
)
) SS.
On November t i , 2004, before me, ►.A t ; \,,(0.0 i ] 1- , a Notary
Public, personally appeared 1f,),tt;ate, A _ witie , personally
known to me (o prov@ to me one bat 4gof a• &factory 2 4clatc) to be the er,son(g whose
nam-(� ubscribed to the within instrument and acknowledged to me tha h shelfhey
executed the same ingner,itheir authorized capacity(j$, and that by I ' r/thcir
signature((] on the instrument the person($f , or the entity upon behalf of which the person(s5
acted, executed the instrument.
IN WITNESS WHEREOF, I have hereunto set my hand
tom tenvrct
�,'�.I,?�'!i`. eassaConunhmon • 1436563
Notary Public • Catania I Notary Public
OrangeCounty
MyConwn. p 'Seps4,zao
[Affix Notarial Seal] a
My commission expires: 2 V. 2007
1-IR/407403.2
STATE OF C Carr z
) SS.
COUNTY OF 0 rant'
On Novembers, 2004, before me, en,..,a;` 1:1;e, �c_ca,,,,,i� , a Notary
Public, personally appeared 5a��Qc� ,M _ NVI, € .y, 4- _ is , personally
known to me (or proved to me on the basis of satisfactory evidence) to be the persons}whose
name is/are subscribed to the within instrument and acknowledged to me that he/sheFtkey-
executed the same in his/hoe/their authorized capacity(ies), and that by his/kerftkeir
signatures) -on the instrument the person(s), or the entity upon behalf of which the persons-)
acted, executed the instrument.
4WITNESS WHEREOF, I_ have hereunto set my hand and official seal.
.. Caamisabns93$5097 1 rl�Public- Camia fc......z._
Public
My Comm. Fvbea JW 1120 161
[Affix Notarial Seal]
My commission expires:--`.4t11 15 7 r -g
1-1R/407403.2
ATTACHMENT A
DESCRIPTION OF LEASEHOLD ESTATE
[ATTACHED]
I-IR/407403.2
DESCRIPTION OF LEASEHOLD ESTATE
The leasehold estate as created by that certain unrecorded Ground Lease dated
November 1, 2004, executed by'The Irvine Company, a Delaware corporation, as lessor
and Newport Housing Partners, L.P., a California limited partnership, as lessee, as
disclosed by a Memorandum of Lease recorded in the Official Records of Orange
County, California, concurrently herewith.
A 1',con nc N+ B
DESCRIPTION OF REAL PROPERTY
Real Property in the City of Newport Beach, County of Orange, State of California,
described as follows:
PARCEL 1, AS SHOWN ON EXHIBIT"B" ATTACHED TO LOT LINE ADJUSTMENT
NO. LA 2003-11, RECORDED MARCH 19, 2004 AS INSTRUMENT NO.
2004000225274 OF OFFICIAL RECORDS.
APN: 440-132-57 AND 440-132-58
NEW PORT SENIORS
PAGE 1 OF 1