HomeMy WebLinkAboutCARIBOU INDUSTRIES (13)A-2020-265-06
CITY OF SANTA ANA
PUBLIC IMPROVEMENT LOAN AGREEMENT WITH CARIBOU INDUSTRIES, INC.
&'LPA(\) (Downtown Hotel and Mixed -Use: Residential and Retail/Commercial Project
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This Public Improvement Loan Agreement (the "Agreement") is entered into as of
co December 6, 2022, by and between the City of Santa Ana, a California charter city in the County
a of Orange of the State of California (the "City"), and Caribou Industries, Inc. a Nevada
1c.'s Corporation (referred herein as "Caribou" or the "Borrower") (collectively, City and Caribou are
LZ referred to as the "Parties"), with reference to the following facts:
RECITALS
A. The City owns that certain real property generally located at 201 West 3rd Street,
Santa Ana, California 92701, and as more particularly described in the legal description(s)
attached to this Agreement as Exhibit "A" and depicted on the Parcel Map attached hereto as
Exhibit "B" (the "Property"),
B. City and Caribou have entered into a Disposition and Development Agreement
dated October 5, 2020, for reference purposes only, (the "DDA") wherein the Parties agreed City
would convey the Property to Caribou for the development of the Property with a Mixed Use
Project including 171 residential apartment units, commercial (including retail and
food/bevorage establishments), a seventy-five (75) room Hotel Project and rooftop amenities
ancillary to the residential and hotel uses, and a Parking Structure which will contain 444 total
parking spaces including 211 public parking spaces (the "Project').
C. Pursuant to the DDA, the City shall remain the owner of "Parcel A' as shown on
the Parcel Map which contains 211 public parking spaces ("Public Parking Parcel").
D. Pursuant to the DDA, Borrower shall be the owner of the Mixed Use Project
which contains 196 parking spaces shown as "Parcel B" on the Parcel Map_(the "Mixed Use
Parking").
E, Pursuant to the DDA, Borrower shall be the owner of the Hotel Project which
contains eighty-three (83) parking spaces, of which, 37 spaces are located in the Parking
Structure, shown as "Parcel C" on the Parcel Map (the "Hotel Parking" which together with the
Mixed Use Parking may be referred to together as "Developer Parking Parcels").
R The Public Parking Parcel and the Developer Parking Parcels may be referred to
together as the "Parking Structure".
G. On November 17, 2020, the City Council adopted the following resolutions
approving the development of the Project (together, the "Project Approvals"): Resolution No.
2020-088 approving an addendum to the Environmental hmpact Report for the Transit Zoning
Code Project (SCH No. 2006071100) and adoption of a mitigation monitoring and reporting
program for Density Bonus Agreement Application No. 2020-01, Site Plan Review No. 2020-01,
Site Plan Review No. 2020-02, and the DDA; Resolution No. 2020-089 approving Density
Bonus Agreement No. 2020-01 and Site Plan Review No. 2020-01 as conditioned for a New
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Mixed -Use and Hotel Development Located at 201 West Third Street; and, Resolution No. 2020-
090 approving the DDA and authorizing the City Manager to enter into the DDA with Declarant.
H. Per the DDA, the City agreed to pay the actual reasonable costs tip to a total of a
maximum thirteen million dollars ($13,000,000) for the following improvements (the "City
Funded Improvements"): (i) the demolition of the existing three (3) level parking structure
located on the Property; (ii) the preparation of the Project site for construction to a rough grade
condition; (iii) the construction of the Public Parking Parcel within the 10-story Parking
Structure containing 444 parking spaces; and, (iv) construction of the private street reconnecting
Sycamore Street between 3rd Street and 4th Street.
I. Pursuant to section 5.10.2 (d) of the DDA "Developer shall personally guarantee
the City Financing and said guarantee shall be recorded against the Property. Said guarantee
shall prohibit the subdivision of the property until such time as the City Funded Improvements
have bean paid in their entirety. Should Developer fail to make a monthly payment, City shall be
entitled to Foreclose upon the Property. City shall be entitled to recover the unpaid portion of the
City Funded Improvemeats and any costs associated with the Funding. and Foreclosure including
but not limited to the time and expenses of the City Attorney's Office, other City staff, any
Consultants or experts retained in connection with the Third Party Challenge, attorneys fees of
Citys selected outside counsel, and litigation costs shall be fully reimbursed to City by the funds
obtained in the Foreclosure."
J. The City is willing to utilize City Funds to finance the construction of the City
Funded Improvements.
K. City and Borrower agree that Borrower shall repay City for any and all costs
incurred by City including interest for the Public Improvement Loan.
L. Upon close of escrow pursuant to the DDA, Borrower will be the owner of the
Property.
M. The Project will provide significant public benefit to the City, both by providing
additional options for visitors to stay in the City of Santa Ana for both business and pleasure, and
by providing significant additional General Fund revenue to the City to provide needed public
services.
N. City is willing to make the Public Improvement Loan for the City Funded
Improvements subject to the terms and conditions set forth herein, provided that Stich Public
Improvement Loan is used solely for the construction of the City Funded Improvements that are
required for the Project.
NOW, THEREFORE, the Parties agree as follows:
ARTICLE 1
Section 1.1 Definitions.
The following capitalized terms have the meanings set forth in this Section 1.1 wherever
used in this Agreement, unless otherwise provided:
(a) "Agreement" means this Public Improvement Loan Agreement.
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(b) "Budget" means the budget agreed upon by the City and Borrower for the
City Funded Improvements required by the City as conditions of regulatory agreement for the
Project, as shown in the Public Improvement Scope of Work attached hereto as Exhibit "C" and
incorporated herein by this reference.
(c) "City" means the City of Santa Ana, a California charter city in the
County of Orange of the State of California.
(d) "City Funded hnprovements" means: (i) demolition of the existing three
(3) level parking structure located on the Property; (ii) preparation of the Project site for
construction to a rough grade condition; (iii) construction of the Public Parking Parcel; and, (iv)
construction of the private street recormecting Sycamore Street between 3rd Street and 4th Street.
(e) "Deed of Trust" is the Deed of Trust, Assignment of Rents, Security
Agreement, and Fixture Filing executed by Caribou as security for repayment of the Public
Improvement Loan pursuant to the terms of the Promissory Note. The form of the Deed of Trust
is attached hereto as Exhibit "E" and incorporated herein by this reference.
(0 "Event of Default" has the meaning set forth in Section 5.1.
(g) "Indemnified Parties" means the City and its council, commissions,
agents, attorneys, officers, employees and authorized representatives.
(h) "Loan Documents" means this Agreement, the Promissory Note and the
Deed of Trust.
(i) "Personal Guarantee" Michael Harrah has agreed to personally guarantee
the City's loan of Thirteen Million Dollars ($13,000,000.00) to Borrower. The Personal
Guarantee will be in the form attached hereto as Exhibit "F".
0) "Promissory Note" means the promissory note that will evidence the terms
under which Borrower is required to repay the Public Improvement Loan. The Promissory Note
will be in the form attached hereto as Exhibit "D".
(lc) "Project" means the Mixed Use Project including 171 residential
apartment units, commercial (including retail and food/beverage establishments), a seventy-five
(75) room Hotel Project and rooftop amenities ancillary to the residential and hotel uses, and a
Parking Structure which will contain 444 total parking spaces including 211 public parking
spaces in accordance with the City Approvals and all related and subsequent City Approvals,
(1) "Public Iunprovement Loan" means that certain loan made by City in the
amount not to exceed Thirteen Million Dollars ($13,000,000.00) to Borrower to be used solely
for the constriction and installation of the City Funded Improvements, which loan is made
pursuant to the terms and conditions of this Agreement.
Section 1.2 Exhibits. The following exhibits are attached to this Agreement and
incorporated into this Agreement by this reference:
Exhibit A: Legal Description of the Property.
55394.00049W 0884 [70.6
Exhibit B: Parcel Map,
Exhibit C: Public Improvement Scope of Work.
Exhibit D: Form of Promissory Note.
Exhibit E: Form of Deed of Trust.
Exhibit F: Personal Guarantee.
ARTICLE 2 PUBLIC IMPROVEMENT LOAN PROVISIONS
Section 2.1 Public Improvement Loan, The City shall lend the Public
Improvement Loan to the Borrower a total amount not to exceed Thirteen Million Dollars
($13,000,000.00), for the purpose of constructing and installing the City Funded
Improvements as set forth in the Budget.
Section 2.2 City's Discretion. City may decide in its sole and absolutely
discretion to fund the Public Improvement Loan either from the City's general fund or City
may enter into a private rate loan,
Section 2.3 Loan Repayment, The obligation to repay the Public Improvement
Loan is evidenced by the Promissory Note and the Public Improvement Loan shall be
repaid in accordance with the terms set forth therein and this Agreement.
Section 2.4 City Costs. Borrower agrees to pay City for all costs, including staff
time associated with entering into this Agreement in addition to any interest for the Public
Improvement Loan.
Section 2.5 Interest.
(a) If the City determines to fund the Public Improvement Loan from the
City's General Fund, then the Public Improvement Loan shall accrue interest at the Local
Agency Investment Fund (LAIF) rate. The rate shall readjust July]" of each year. For each rate
adjustment on July 1, the LAIF rate for the 12 months ended the preceding May shall be used.
Until the first rate adjustment on July 1, 2023, the LAIF rate for the 12 months ended December
2022 shall be used. The Borrower shall deposit the full amount of each debt service payment
with the City three (3) days prior to the due date as determined by the City: prior to the first such
payment.
(b) If the City determines to fund the Public Improvement Loan through a
Private Loan, then Borrower shall repay the City for any and all interest and fees charged as a
result of that Private Loan, The Borrower shall deposit the full amount of each debt service
payment with the City ten (10) days prior to the due date required by the City's lender,
Section 2.6 Use of Loan Funds. The Borrower shall use the Public Improvement
Loan solely to pay the cost of construction and installation of the City Funded
Improvements in accordance with the City Approvals, any improvement plan submitted to
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and approved by the City, and the Budget and any change orders not to exceed the amount
set for in Section 2.1.
Section 2.7 Secures. Borrower shall secure its obligation to repay the Public
Improvement Loan, as evidenced by the Promissory Note, by Borrower executing the Deed
of Trust, and Michael Harrah shall execute a Personal Guarantee the form attached hereto
as Exhibit "F".
Section 2.8 Disbursement of Public Improvement Loan Funds. The City shall
make disbursements of Public Improvement Loan funds from time to time for use in
accordance with this Agreement, subject to the conditions set forth below.
(a) Conditions Precedent. The City shall disburse Public Improvement Loan
funds provided for herein from time to time upon City's receipt of invoices and supporting
documentation from Borrower, provided that Borrower must comply with the following
conditions precedent prior to each disbursement by City of proceeds of the Public Improvement
Loan:
(i) The Borrower shall have executed, in recordable form where
applicable, and delivered to the City the Promissory Note and the Deed of Trust;
(ii) Delivery of a binding commitment by a title insurance company
acceptable to the City to issue a lender's policy of Title Insurance with any endorsements the
City may reasonably require, insuring the City in the principal amount of the Public
Improvement Loan, of the validity and priority of the Deed of Trust upon the Property, subject
only to liens and matters of record approved by the City in writing;
(iii) Deliver of an executed Personal Guarantee by Michael. Harrah to
the City, as set forth in Exhibit F.
(iv) All representations and warranties made by the Borrower in this
Agreement, the Promissory Note, and the Deed of Trust, and any other related documents shall
be true and correct as of the date of the proposed disbursement;
(v) Borrower is not in Default under the terms of this Agreement or
the Project including the DDA; and,
(vi) Borrower has received Building Permit(s) for Project and have
received all relevant Encroachment Permit(s) for public off -site improvements.
(b) Disbursement Process. The process for the disbursement of the proceeds
of the Public Improvement Loan shall be as follows:
(i) Prior to the initial disbursement, Borrower and the City Building
Official shall approve a final Budget including a disbursement schedule based on the final plans
and specifications for which the building permits for the City Funded Improvements were issued.
(ii) Borrower shall submit to City monthly invoices including
supporting documentation showing the actual costs incurred for the City Funded Improvements.
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(iii) City shall review the invoices and supporting documentation. If
invoice is for actual costs that are consistent with the approved Budget, the City shall pay the
invoice within fourteen days,
(iv) If the invoice exceeds the approved Budget and City reasonably
determines additional information is. needed, within fourteen (14) days of the receipt of the
invoice City shall specify the additional information or documentation that is needed for City to
determine whether the costs exceeding the approved Budget are reasonable. City may object in
writing to any expenses contained in a monthly invoice that exceed the approved Budget the City
reasonably determines are unreasonable within fourteen (14) days of receiving the monthly
invoice or the receipt of the additionally requested documentation or additional information,
whichever comes later, If City does not object to the reasonableness of any expenses exceeding
the approved Budget or request additional documentation related to any excess costs within
fourteen (14) days of receiving the monthly invoice, the costs exceeding the, approved Budget
shall be deemed reasonable.
(v) Borrower shall provide the requested documentation within
fourteen (14) days, unless City grants a longer period of time for compliance. Should Borrower
fail to timely provide the requested documentation, the expense shall be deemed unreasonable.
(vi) Within fourteen (1.4) days of receiving City's written objection,
Borrower shall have the right to provide additional supporting documentation to justify the
reasonableness of the expense to the City, City shall review any additional supporting
documentation provided by Borrower to reconsider the reasonableness of the expense for the
City Funded Improvements.
(vii) City shall pay any reasonable costs for the construction of the City
Funded Improvements that exceed the approved Budget up to the total maximum amount of
$13,000,000, within thirty (30) days of receipt of monthly invoice or the receipt of the
additionally requested documentation or additional information, whichever comes later.
2.6 City Not Liable. Other than for the disbursement of the Public Improvement
Loan to Borrow in accordance with the terms of this Agreement, the City shall not be liable to
Borrower or any other party, including but not limited to any lender, contractor or subcontractor,
for any damage whatsoever which may result in whole or in part from any action or inaction of
the City hereunder, including without limitation, failure or delay in funding any proceeds of the
Public Improvement Loan, except to the extent of the City's gross negligence or willful
misconduct.
ARTICLE 3
Section 3.1 Borrower Covenant to Undertake the Project. Borrower covenants
and agrees for itself, its successors and assigned, for the benefit of the City, that it shall
commence and complete the development of the Project including the City Funded
Improvements in accordance with all Project Approvals, the DDA, permits and conditions
issued by the City.
Section 3.2 Equal Opportunity. During the construction or installation of the
Project and the City Funded Improvements there will be no discrimination on the basis of
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race, color, creed, religion, age, sex, sexual orientation, marital status, national origin,
ancestry, or disability in the hiring, firing, promoting, or deinoting of any person engaged
in the construction work.
Section 3.3 Construction Responsibilities. Borrower shall be solely responsible
for all aspects of Borrower's conduct in connection with the construction or installation of
the Project and the City Funded Improvements, including (but not limited to) the quality
and suitability of the plans and specifications, the supervision of construction work, and the
qualifications, financial condition, and performance of all architects, engineers, contractors,
subcontractors, suppliers, consultants, and property managers. Any review or inspection
undertaken by the City with reference to the Project or the City Funded Improvements is
solely for the purpose of determining whether Borrower is properly. discharging its
obligations to the City, and should not be relied upon by Borrower or by any third parties
as a warranty or representation by the City as to the quality of the design or construction of
the Project or the City Funded Improvements.
Section 3 A Compliance with Construction Laws and Requirements.
(a) The Borrower shall construct or install the City Funded Improvements and `
perform all work on the Project in conformity with all applicable governmental requirements
("Govermnental Requirements'), including but. not limited to the Project Approvals, all
applicable state labor laws and standards, all applicable Public Contract Code requirements, the
City's applicable zoning and development standards, building, plumbing, mechanical and
electrical codes, all other applicable provisions of the City's Municipal Code.
(b) City and Borrower acknowledge and agree that the DDA and the Public
Improvement Loan made pursuant to this Agreement requires that laborers employed by
Borrower relative to the construction, installation or operation of the work constituting the
construction or installation of the City Funded Improvements and the Project must be paid the
prevailing per diem wage rate for their labor classification, as determined by the State of
California, pursuant to Labor Code section 1720 et sect, and regulations promulgated thereunder
(the "Prevailing Wage Laws").
(c) The Borrower agrees with the City that the Borrower shall be subject to
the Community Workforce Agreement dated 2017, attached to the DDA as Exhibit H for any
demolition or construction of the Project or City Funded Improvement. Borrower shall obtain a
Letter Of Assent (Attachment A of the workforce agreement) for each and every contractor
awarded work covered by the Community Workforce Agreement prior to commencing work on
the Project or City Funded Improvement.
(d) Notwithstanding the foregoing, Borrower shall defend, indemnify and
hold harmless the City and its officials, officers, employees, agents and representatives from and
against any and all present and future. liabilities, obligations, orders, claims, damages, fines,
penalties and expenses (including attorneys' fees and costs) (collectively, "Claims"), including
but not limited to any claims pursuant to Labor Code sections 1726 and 1781, arising out of or in
any way connected with the Borrower's obligation to comply with all Governmental
Requirements with respect to the work for the City Funded Improvements or the Project,
including the Prevailing Wage Laws and all other applicable state labor laws and standards,
except to the extent such Claims result from actions of the City or its officials, officers,
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employees, agents or representatives, which prevent Borrower from complying with
Governmental Requirements. If, at any time, Borrower believes that the City or its officials,
officers, employees, agents or representatives, are preventing Borrower from complying with
Governmental Requirements, then Borrower shall provide notice to the City of the basis of such
conclusion by Borrower to enable the City to take such actions as may be necessary or
appropriate to enable Borrower to comply with Governmental Requirements. The indemnity and
defense obligations under this Agreement shall survive the expiration or earlier termination of
this Agreement, until all claims against any of the Indemnitees involving any of the indemnified
matters are fully, finally, absolutely and completely barred byAp-xlicable statutes of limitations
Initials
(e) Borrower, on behalf of itself, its successors and assigns, waives and
releases the City from any right of action that may be available to any of them pursuant to Labor
Code sections 1726 or 1781. Borrower acknowledges the protections of Civil Code section 1542
relative to the waiver an release contained in this Section 3.4, which reads as follows:
A general release does not extend to claims that the creditor or
releasing party does not know or suspect to exist in his or her
favor at the time of executing the release and that, if known by
him or her, would have materially affected his or her settlement
with the debtor or released party.
By initialing below, Borrower knowingly and v tartly waives the provisions of
Civil Code section 1542 solely in connection with the waive releases of this Section 3.4.
Bon a Initials
Section 3.5 Inspections. Borrower understands and agrees that it will be
monitored by the City from time to time to assure compliance with all terms and conditions
in this Agreement. Borrower acknowledges that the City may also conduct periodic on -site
inspections of the Project or the City Funded Improvements, during normal business hours.
Borrower shall cooperate with the monitoring by the City and ensure access to the Project
and all information related to the Project as required by the City. The City shall indemnify
and hold Borrower and its agents, attorneys, officers, employees, contractors, and
authorized representatives harmless from any and all claims, damages, injury, property
damage or liability arising out of the exercise by the City of the right of access to the
Property provided in this Section 3.5, other than injury, property damage or liability arising
from the negligence or willful misconduct of Borrower or its officers, agents or employees.
Section 3.6 City Consultant. If the City reasonably decides it is necessary, the
City shall have the further right, from time to time, to retain a consultant or consultants at
City's sole cost to inspect the Project and verify compliance by Borrower with the
provisions of this Agreement. Borrower acknowledges and agrees that any such
inspections are for the sole purpose of protecting the City's rights under this Agreement,
are made solely for the City's benefit, that the inspections may be superficial and general in
nature, and are for the purposes of informing the City of the progress of the Project and the
55394.00049A0884170,6 8
conformity of the Project with the terms and conditions of this Agreement, and that
Borrower shall not be entitled to rely on any such inspection(s) as constituting an approval,
satisfaction or acceptance of any materials, workmanship, conformity of the Project with
this Agreement or otherwise. Borrower agrees to make its own regular inspections of the
work of construction of the Project to determine that the quality of the Project and all other
requirements of the work of construction of the Project are being performed in a mannor
satisfactory to Borrower.
Section 3.7 Examination, Without limiting the foregoing, upon request by the
City and during normal business hours, Borrower shall permit the City to examine and
copy all books and account records and other papers relating to the Property and the
construction of the City Funded Improvements. Borrower will use commercially
reasonable efforts to cause all contractors, subcontractors and materialmen to cooperate
with the City to enable such examination.
ARTICLE 4 PUBLIC IMPROVEMENT LOAN REQUIREMENTS
Section 4.1 Information. Borrower shall provide any information reasonably
requested by the City in connection with the City Funded Improvements,
Section 4.2 Audits. Borrower shall make available for examination at
reasonable intervals and during normal business hours to City all books, accounts, reports,
files, and other papers or property with respect to all matters covered by this Agreement,
and shall permit City to audit, examine, and make excerpts or transcripts from such records.
City may make audits of any conditions relating to this Agreement.
Section 4.3 Environmental Indemnity of the City by Borrower. The Borrower
agrees, at its sole cost and expense, to fully indemnify, protect, hold harmless, and defend
(with counwl selected by the Borrower and reasonably approved by the City) the
Indemnified .Parties, from and against any and all claims, demands, damages, losses,
liabilities, obligations, penalties, fines, actions, causes of action, judgments, sluts,
proceedings, costs, disbursements and expenses, including, without limitation, attorney
fees, disbursements and costs of attorneys, environmental consultants and other experts,
and all foreseeable and unforeseeable damages or costs of any kind or of any nature
whatsoever (collectively, "Environmental Claims") that may, at any time, be imposed
upon, incurred or suffered by, or claimed, asserted or awarded against, the Indemnified
Parties, relating to or arising from any of the following "Environmental Matters"
occurring during or arising from the Borrower's ownership of the property upon which the
Project is located, or construction or operation of the Project (excluding any matters to the
extent they arise from a release of Hazardous Substances that occurred prior to Borrower's
possession of the Property):
(a) The presence of Hazardous Substances on, in, under, from or affecting all
or any portion of the City Funded Improvements or the Project.
(b) The storage, holding, handling, release, threatened release, discharge,
generation, leak, abatement, removal or transportation of any Hazardous Substances on, in,
under, from or affecting the City Funded Improvements or the Project.
55394.00049\40884170.6 9
(c) The violation of any law, rule, regulation, judgment, order, permit, license,
agreement, covenant, restriction, requirement or the like by Borrower, its agents or contractors,
relating to or governing in any way Hazardous Substances on, in, under, from or affecting the
City Funded Improvements or the Project.
(d) The failure of the Borrower, its agents or contractors, to properly
complete, obtain, submit and/or file any and all notices, permits, licenses, authorizations,
covenants and the like in connection with the Borrower's activities on the Properly or regarding
the Project.
(e) The implementation and enforcement by the Borrower, its agents or
contractors of any monitoring, notification or other precautionary measures that may, at any
time, become necessary to protect against the release, potential release or discharge of Hazardous
Substances on, in, under, from or affecting the City Funded Improvements or the Project.
(t) The failure of the Borrower, its agents or contractors, in compliance with
all applicable Environmental haws, to lawfully remove, contain, transport or dispose of any
Hazardous Substances existing, stored or generated on, in, under or from the City Funded
Improvements or the Project.
(g) Any investigation, inquiry, order, hearing, action or other proceeding by or
before any Governmental Agency in connection with any Hazardous Substances on, in, under,
from or affecting the Property or the Project or the violation of any Environmental Law relating
to the City Funded Improvements or the Project.
(h) The Borrower shall pay to the Indemnified Parties all costs and expenses
including, without limitation, reasonable attorneys' fees and costs, incurred by the Indemnified
Parties in connection with enforcement of the aforementioned environmental indemnity.
(1) Notwithstanding anything to the contrary in this Section 4.3, Borrower
shall have no obligation to indemnify any of the Indemnified Parties with respect to
Environmental Matters or Environmental Claims to the extent relating to or arising from the
active negligence or willful misconduct of any of the Indemnified Parties.
a) Survival of Environmental Indemnity Obligations. The Environmental
Indemnity obligations under this Section 4.3 shall survive the expiration or earlier termination of
this Agreement, until all claims against any of the Indemnitees involving any of the indemnified
matters are fully, finally, absolutely and completely barred by applicable statutes of limitations..
Section 4.4 Nondiscrimination. Borrower for itself, its successors and assigns to
all or any part or portion of the Property and/or Project, covenants and agrees that there
shall be no discrimination against or segregation of any person, or group of persons, on
account of sex, marital status, race, color, religion, creed, national origin or ancestry in the
sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property nor shall
Borrower, itself or any person claiming under or through it, establish or permit any such
practice or practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, sub -tenants, sub -lessees or vendees
of the Property. Subdivisions (d) of Section 51 and Section 1360 of the Civil Code and
subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to this
55394.00049\40884170.6 10
Section 4.4, The covenant of this Section 4.4 shall run with the land of the Property and
shall be enforceable against Borrower and its successors and assigns in perpetuity.
Section 4.5 Insurance Requirements. Prior to the commencement of
construction or installation of the City Funded Improvements (or any work related thereto),
the Borrower shall furnish, or cause to be furnished, to the City duplicate originals or
appropriate certificates of bodily injury and property damage insurance policies in
compliance with the following:
(a) Coverage shall be at least as broad as:
(i). Commercial General Liability (CGL): Insurance Services Office
Form CG 00 01 covering CGL on an "occurrence" basis, including products and completed
operations, property damage, bodily injury and personal & advertising injury with limits no less
than $2,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate
limit shall apply separately to this project/location (ISO CG 25 03 or 25 04) or the general
aggregate limit shall be twice the required occurrence limit.
(if), Automobile Liability: Insurance Services Office Form Number CA
0001 covering, Code I (any auto), or if Borrower has no owned autos, Code 8 (hired) and 9
(non -owned), with Inuit no less than $1,000,000 per accident for bodily injury and property
damage.
(iii). Workers' Compensation insurance as required by the State of
California, with Statutory Limits, and Employer's Liability Insurance with limit of no less than
$1,000,000 per accident for bodily injury or disease.
(b) If the Borrower maintains broader coverage and/or higher limits than the
minimums shown above, the City requires and shall be entitled to the broader coverage and/or
the higher limits maintained by the Borrower. Any available insurance proceeds in excess of the
specified minimum limits of insurance and coverage shall be available to the City.
(c) Other Insurance Provisions. The insurance policies are to contain, or be
endorsed to contain, the following provisions:
(i)Additional Insured Status. The City, its officers, officials, employees,
and volunteers are to be covered as additional insureds on the CGL policy with respect to
liability arising out of work or operations performed by or on behalf of the Borrower including
materials, parts, or equipment furnished in connection with such work or operations, General
liability coverage can be provided in the form of an endorsement to the Borrower 's insurance (at
least as broad as ISO Form CO 20 10 1185 or both CG 2010, CG 20 26, CG 20 33, or CG 20
38; and CG 20 37 forms if later revisions used).
(d) Primary Coverage. For any claims related to this contract, the Borrower's
insurance coverage shall be primary insurance primary coverage at least as broad as ISO CG 20
0104 13 as respects the City, its officers, officials, employees, and volunteers. Any insurance or
self-insurance maintained by the City, its officers, officials, employees, or volunteers shall be
excess of the Borrower's insurance and shall not contribute with it.
(e) Notice of Cancellation. Each insurance policy required above shall state
that coverage shall not be canceled, except with notice to the City,
55394.00049Wo884170.6 I I
(f) Waiver of Subrogation. Borrower hereby grants to City a waiver of any
right to subrogation which any insurer of said Borrower may acquire againstthe City by virtue of
the payment of any loss under such insurance. Borrower agrees to obtain any endorsement that
may be necessary to affect this waiver of subrogation, but this provision applies regardless of
whether or not the City has received a waiver of subrogation endorsement from the insurer,
(g) Self -Insured Retentions, Self -insured retentions must be declared to and
approved by the City. The City may require the Borrower to purchase coverage with a lower
retention or provide proof of ability to pay losses and related investigations, claim
administration, and defense expenses within the retention. The policy language shall provide, or
be endorsed to provide, that the self -insured retention may be satisfied by either the named
insured or City.
(h) Acceptability of Insurers. Insurance is to be placed with insurers
authorized to conduct business in the state with a current A.M. Best's rating of no less than
A:VII, unless otherwise acceptable to the City.
(i) Claims Made Policies. If any of the required policies provide coverage on
a claims -made basis:
(i)The Retroactive Date must be shown and must be before the date of the
Agreement or the beginning of the City Funded Improvements,
(ii)Insurance must be maintained and evidence of insurance must be
provided for at least five (5) years after completion of the City Funded Improvements.
(iii)l£ coverage is canceled or non -renewed, and not replaced with another
claims -made policy form with a Retroactive Date prior to the contract effective date, the
Borrower must purchase "extended reporting" coverage for a minimum of five (5) years after
completion of the City Funded Improvements .
0) Verification of Coverage. Borrower shall furnish the City with original
Certificates of Insurance including all required amendatory endorsements (or copies of the
applicable policy language effecting coverage required by this clause) and a copy of the
Declarations and Endorsement Page of the CGL policy listing all policy endorsements to City
before work begins. However, failure to obtain the required documents prior to the work
beginning shall not waive the Borrower's obligation to provide them. The City,reserves the right
to require complete, certified copies of all required insurance policies, including endorsements
required by these specifications, at any time.
(k) Subcontractors. Borrower shall require and verify that all subcontractors
maintain insurance meeting all the requirements stated herein, and Borrower shall ensure that
City is an additional insured on insurance required from subcontractors,
(1) Special Risks or Circumstances. City reserves the right to modify these
requirements, including limits, based on the nature of the risk, prior experience, insurer,
coverage, or other special circumstances.
(m) Survival of Insurance Obligations. The insurance obligations under this
Section 4.5 shall survive the expiration or earlier termination of this Agreement, and Insurance
55394.0004%40884170.6 12
must be maintained and evidence of insurance must be provided for at least five (5) years after
completion of the City Funded Improvements.
Section 4.6 Permitted Transfers/Consent. Borrower may only cause or permit
any voluntary transfer, assignment or encumbrance of its interest in the Property or in the
Project in accordance with Section 10,2 of the DDA. Any transfer, assigmment,
encumbrance or sublease not made in accordance with Section 10.2 of the DDA will be
voidable and, at the City's election, constitute an Event of Default under this Agreement.
The City's consent to any specific assignment, encumbrance, sublease or other transfer will
not constitute its consent to any subsequent transfer or a waiver of any of the City's rights
under this Agreement. However, Borrower shall be prohibited from encumbering the
Property or Project until the demolition of the Property has been completed, Demolition
shall mean the completion of all the following: Items 1 through 4 of the scope of work
described in Exhibit C as well as; (1) grade site to drain, including installation of all erosion
control devices; (2) grade and shore site after demolition to sufficiently support all adjacent
existing right of way (such as alley, sidewalks, and streets) and nearby adjacent structures;
and (3) Removal of temporary traffic control devices utilized for demolition and rough
grading of the site from Broadway, Third Street and Sycamore Street, and open streets to
safe travel. After completion of demolition, the Borrower may request the City subordinate
the Loan Documents, including the Deed of Trust, to any Permitted Eneumbrance(s)
authorized by the DDA. Upon request of Borrower, the City shall consider the
subordination request and may in its sole and absolute discretion decide whether to
subordinate the Loan. If City agrees to subordinate the Loan the Parties shall cooperate to
execute the subordination agreement and/or other instruments necessary to affect such
subordination,
(a) Parties acknowledge that City has the duty, pursuant to the DDA, to fund
the reasonable actual costs to a maximum of $13 million dollars ($13,000,000.00) for the City
Funded Improvements as that term is defined in the DDA. Nothing in this Section 4.6 or this
Agreement shall prevent Borrower from notifying the City in writing that Borrower is waiving
the right to the funding by the City of the reasonable actual costs to a maximum of $13 million
dollars ($13,000,000.00) for the City Funded Improvement pursuant to the terms of'the DDA.
Such waiver by Borrower shall have no effect on the duty of Borrower to construct the City
Funded Improvements in accordance with the terms of the DDA, Borrower may issue the
waiver at any time and shall have the option to (i) refinance and/or prepay the Public
Improvement Loan at any time, as permitted by the Promissory Note, or (ii) obtain alternative
financing prior to the funding of the Public Improvement Loan. Upon the occurrence of (i) or
(ii) above, the Parties shall execute necessary documents to terminate this Agreement..
Section 4.7 Subdivision of the Property. The Property shall not be subdivided
until such time as the City Funded Improvements have been paid in their entirety.
ARTICLE 5 DEFAULT AND REMEDIES
Section 5.1 Event of Default, Any material breach by Borrower of any
covenant, agreement, provision or warranty contained in this Agreement or in any of the
Loan Documents that remains. uncured upon the expiration of any applicable notice and
55394,00049\40984170.6 13
cure periods contained in any Loan Document will constitute an "Event of DefauIt,"
including the following:
(a) Borrower fails to make any payment required under this Agreement within
ten (10) days after the date when due and the payment is not made within fifteen (15) days after
Borrower's receipt of written notice from the City to cure the default.; or
(b) Any lien is recordedagainst all or any part of the Property without the
City's prior written consent, and the lien is not removed from title or otherwise remedied to the
City's satisfaction within thirty (30) days after Borrower's receipt of written notice from the City
to cure the default, or, if the default cannot be cured within a 30-day period, Borrower will have
sixty (60) days to cure the default, or any longer period of time deemed necessary by the City,
provided that Borrower commences to cure the default within the 30-day period and diligently
pursues the cure to completion; or
(c) Borrower fails to perform or observe any other term, covenant or
agreement contained in any Loan Document, and the failure. continues for thirty (30) days. after
Borrower's receipt of written notice from the City to cure the default, or, if the default cannot be
cured within a 30-day period, Borrower will have sixty (60) days to cure the default, or any
longer period of time deemed necessary by the City, provided that Borrower commences to cure
the default within the 30-day period and diligently pursues the cure to completion; or,
(d) Any representation or warranty made by Borrower in any Loan Document
proves to have been incorrect in any material respect when made; or
(e) Borrower is dissolved or liquidated or merged with or into any other
entity; or, if Borrower ceases to exist in its present form and (where applicable) in good standing
and duly qualified under the laws of the jurisdiction of formation and California for any period of
more than thirty (30) days; or all or substantially all of the assets of Borrower are sold or
otherwise transferred; or
(t) Borrower voluntarily or involuntarily assigns or attempts to sell, lease,
assign, encumber or otherwise transfer all or any portion of the ownership interests in or of its
right, title or interest in the Project or the Property in violation of Section 4.6 above; or
(g) Borrower is subject to an order for relief by the bankruptcy court, or is
unable or admits in writing its inability to pay its debts as they mature or makes an assignment
for the benefit of creditors; or Borrower applies for or consents to the appointment of any
receiver, trustee or similar official for the applicable party or for all or any part of its property (or
an appointment is made without its consent and the appointment continues undischarged and
unstayed for sixty (60) days); or Borrower institutes or consents to any bankruptcy, insolvency,
reorganization, arrangement, readjustment of debt, dissolution, custodianship, conservatorship,
liquidation, rehabilitation or similar proceeding relating to the applicable party or to all or any
part of its property under the laws of any jurisdiction (or a proceeding is instituted without its
consent and continues undismissed and unstayed for more than sixty (60) days); or any
judgment, writ, warrant of attachment or execution or similar process is issued or levied against
the Project, the improvements or any other property of Borrower and is not released, vacated or
fully bonded within sixty (60) days after its issue or levy; or
55394.00049W0884170.6 14
(h) Borrower is in default of its obligations with respect to any funding
obligation (other than the Public Improvement Loan) for the Project, and. the default remains
uncured following the expiration of any applicable cute periods; or
(i) Borrower is in default of its obligations under any other agreement entered
into with the City including but not limited to the DDA, and the default remains uncured
following the expiration of any applicable cure periods.
Section 5.2 Remedies. During the pendency of an uncured Event of Default, the
City may exercise any right or remedy available under this Agreement or the Promissory
Note or at law or in equity. All of the City's rights and remedies following an Event of
Default are cumulative, including:
(a) The City at its option may declare the unpaid principal balance of the
Promissory Note, together with default interest as provided in the Promissory Note and any other
charges due under the Promissory Note, immediately due and payable without protest,
presentment, notice of dishonor, demand or further notice of any kind, all of which Borrower
expressly waives, '
(b) The City may apply to any court of competent jurisdiction for specific
performance, or an injunction against any violation, of this Agreement or for any other remedies
or actions necessary or desirable to correct Borrower's noncompliance with this Agreement.
(c) All costs, expenses, charges and advances of the City in exercising its
remedies or to protect the Property will be deemed to constitute a portion of the principal balance
of the Promissory Note, even if it causes the principal balance to exceed the face amount of the
Promissory Note, rmless Borrower reimburses the City within ten (10) days of the City's demand
for reimbursement.
Section 5.3 Borrower Indemnification of City. In addition to any other specific
indemnification or defense obligations of Borrower set forth in this Agreement and except
for the City indemnification required in Section 43, Borrower agrees to indemnify, defend
(upon written request by the City and with counsel reasonably acceptable to the City) and
hold hazmless the Indemnified Parties, from any and all losses, liabilities, charges,
damages, claims, liens, causes of action, awards, judgments, costs and. expenses, including,
but not limited to reasonable attorney's fees of counsel retained by the Indemnified Parties,
expert fees, costs of staff time, and investigation costs, of whatever kind or nature
("Claims"), that are in any manner directly or indirectly caused, occasioned or contributed
to in whole or in part, through any act, omission, fault or negligence, whether active or
passive, of the Borrower or the Borrower's officers, agents, employees, independent
contractors or subcontractors of any tier, relating in any manner to this Agreement, any
work to be performed by the Borrower related to this Agreement, the Project, the City
Funded Improvements or any authority or obligation exercised or undertaken by the
Borrower under this Agreement, except to the extent caused by the active negligence or
willful misconduct of any of the Indemnified Parties. Without limiting the generality of the
foregoing, Borrower's obligation to indemnify the Indemnified Parties shall include injury
or death to any person or persons, damage to any property, regardless of where located,
including the property of the Indemi ified Parties, any workers' compensation or prevailing
wage determination, claim or suit or any other matter arising from or connected with any
553 94.00049W08 84170.6 15
goods or materials provided or services or labor performed regarding the Project or the City
Funded Improvements on behalf of Borrower by any person or entity. The indemnity and
defense obligations under this Agreement shall survive the expiration or earlier termination
of this Agreement, until all claims against any of the hidemnitees involving any of the
indemnified matters are fully, finally, absolutely and completely barred by applicable
statutes of limitations.
Section 5.4 Force Maicure. The occurrence of any of the following events will
excuse performance of any obligations of the City or Borrower rendered impossible to
perform while the event continues: strikes; lockouts; labor disputes; acts of God;
pandemics; quarantine restrictions; inability to obtain labor, materials or reasonable
substitutes for either; governmental restrictions, regulations or controls; executive orders;
judicial orders; enemy or hostile goverranental actions; civil commotion; fire or other
casualty and other causes beyond the control of the party obligated to perform. The
occurrence of a force majeure event will excuse Borrower's performance only in the event
that Borrower has provided notice to the City within thirty (30) days of Borrower's actual
knowledge the occurrence or commencement of the event or events, acid Borrower's
performance will be excused for a period ending thirty (30) days after the termination of
the event giving rise to the delay.
ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF BORROWER
Section 6.1 Borrower Representations and Warranties, As a further inducement
for the City to enter into this Agreement, Borrower represents and warrants as follows:
(a) Borrower is lawfully entitled to do business in the State of California and
has the legal right, power and authority to enter into this Agreement and the instruments and
documents referenced herein and to consummate the transactions contemplated hereby. The
persons executing this Agreement and the instruments referenced herein on behalf of the
Borrower hereby represent and warrant that such persons have the power, right and authority to
bind the Borrower.
(b) When duly executed, the Loan Documents will constitute the legal, valid
and binding obligations of Borrower. Borrower hereby waives any defense to the enforcement
of the Loan Documents related to alleged invalidity of the Loan Documents,
(c) No action, suit or proceeding is pending or to the best of Borrower's
knowledge, threatened that might affect the Borrower or the Project adversely in any material
respect.
(d) Borrower is not in default under any agreement to which it is a party,
including any lease of -real property,
(e) All statements and representations made by Borrower in connection with
the Public Improvement Loan remain true and correct as of the date of this Agreement.
ARTICLE 7 NOTICES.
Section 7.1 Notice. Any and all Notices submitted by either Party to the other
Party pursuant to or as required by this Agreement shall be proper, if in writing and
55394.00049W0884170.6 16
transmitted to the principal office of the City or the Developer, as applicable, set forth in
Section 10.5,2, by one or more of the following methods: (i) messenger for immediate
Personal delivery, (ii) a nationally recognized overnight (one-night) delivery service.(i.e.,
Federal Express, United Parcel Service, etc.) or (iii) registered or certified United States
Mail, postage prepaid, return receipt requested. Such Notices may be sent in the same
manner to such other addresses as either Party may designate from time to time, by Notice.
Any Notice shall be deemed to be received by the addressee, regardless of whether or when
any return receipt is received by the sender or the date set forth on such return receipt, on
the day that it is delivered by personal delivery, on the date of delivery by a nationally
recognized overnight courier service (or when delivery has been attempted twice, as
evidenced by the written report of the courier service) or four (4) calendar days after it is
deposited with the United States Postal Service for delivery, as provided in this Section
1151. Rejection, other refusal to accept or the inability to deliver a Notice because of a
changed address of which no Notice was -given or other action by a Person to .whom Notice
is sent, shall be deemed receipt of the Notice. Notices must be addressed as follows:
To City: City of Santa Ana
20 Civic Center Plaza (M-30)
F.O. Box 1988
Santa Ana, CA 92701
Attention: City Clerk
with a copy to: City of Santa Ana
20 Civic Center Plaza (M-29)
P.O. Box 1988
Santa Ana, CA 92701
Attention: City Attorney
To Borrower: Caribou Industries, Inc.
1103 North Broadway
Santa Ana, CA 92701
Attention: Mike Harrah
with a copy to: Rutan & Tucker, LLP
18575 Jamboree Road, 9th Floor
Irvine, CA 92612
Attention: John A. Ramirez
Section 7.2 Required Notices. Borrower agrees to provide notice to the City in
accordance with Section 7.1 of the occurrence of any change or circumstance that: (a) will
have an adverse effect on the physical condition or intended use of the Project or the
Property; or (b) will have a material adverse effect on Borrower's operation of the Project
or ability to repay the Public hnprovement Loan.
ARTICLE 8 GENERAL PROVISIONS
Section 8.1 No Third Party Beneficiaries. Nothing contained in this Agreement,
nor any act of the City, may be interpreted or construed as creating the relationship of third
55394.00049140884170.6 17
party beneficiary, limited or general partnership, joint venture, employer and employee, or
principal and agent between the City and Borrower or Borrower's agents, employees or
contractors,
Section 8.2 No Claims by Third Parties. Nothing contained in this Agreement
creates or justifies any claim against the City by any person or entity with respect to the
purchase of materials, supplies or equipment, or the furnishing or the performance of any
work or services with respect to the Project or the Property. Borrower must include this
requirement as a provision in any contracts for the development of the Project.
Section 8.3 Entire Agreement. This Agreement and its Exhibits incorporate the
terms of all agreements made by the City and Borrower with regard to the subject matter of
this Agreement. No alteration or variation of the terms of this Agreement will be valid
unless made in. writing and signed by the parties hereto. No .oral understandings or
agreements not incorporated herein will be binding on the City or Borrower.
Section 8.4 City Obligations, The City's sole obligation under. this Agreement is
limited to providing the Funds as described in this Agreement, up to the not to exceed
amount of the Public Improvement Loan, for the purpose of constructing and installing the
City Funded Improvements. Under no circumstances, including breach of this Agreement,
will the City be liable to Borrower for any special or consequential damages arising out of
actions or failure to act by the City in connection with any of the Loan Documents.
Section 8.5 Borrower Solely Responsible. Borrower has the right to exercise full
control of employment, direction, compensation and discharge of all persons assisting in
the performance contemplated under this Agreement. Borrower is solely responsible for:
(a) its own acts and those of its agents, employees and contractors and all matters relating
to their performance, including compliance with Social Security, withholding and all other
Laws governing these matters and requiring that contractors include in each contract that
they will be solely responsible for similar matters relating to their employees; (b) any
losses or damages incurred by Borrower, any of its contractors or subcontractors and the
City and its officers, representatives, agents and employees on account of any act, error or
omission of Borrower in the performance of this Agreement or any other Loan Document
and the development and operation of the Project; and (c) all costs and expenses relating to
Borrower's performance of obligations under the Loan Documents, the delivery to the City
of documents, information or items under or in connection with any of the Loan
Documents and taxes, fees, costs or other charges payable in connection with the
execution, delivery, filing and/or recording of any Loan Document or document required
under any Loan Document.
Section 8.6 No Inconsistent Agreements. Borrower warrants that it has not
executed and will not execute any other agreement(s) with provisions materially
contradictory or in opposition to the provisions of this Agreement,
Section 8.7 Inconsistencies in Loan Documents. In the event of any conflict
between the terms of this Agreement and any other Loan Document, the, terms of this
Agreement control unless otherwise stated; provided, however, that any provision in this
Agreement in conflict with any Law will be interpreted subject to that Law.
55394.00049\40894110.6 is
Section 8.8 Governing Law. This Agreement is governed by California law
without regard to its choice of law rules.
Section 8.9 Joint and Several Liability. If Borrower consists of more than one
person or entity, each is jointly and severally liable to the City for the faithfid performance
of this Agreement.
Section 8.10 Successors. Except as otherwise limited herein, the provisions of
this Agreement bind and inure to the benefit of the undersigned parties and their heirs,
executors, administrators, legal representatives, successors and assigns. This provision
does not relieve Borrower of its obligation under the Loan Documents to obtain the City's
prior written consent to any assignment or other transfer of Borrower's interests in the
Public Improvement Loan, the Property or the ownership interests in Borrower.
Section 8.11 Attorneys' Fees. If any legal action is commenced to enforce any of
the terms of this Agreement or rights arising from any party's actions in connection with
this Agreement, the prevailing party will have the right to recover its reasonable attorneys',
fees and costs of suit from the other party, whether incurred in a judicial, arbitration,
mediation or bankruptcy proceeding or on appeal, An award of attorneys' fees and costs .
will bear interest at the default rate under the Promissory Note from the date of the award
until paid.
Section 8.12 Severability. The invalidity or unenforceability of any one or more
provisions of this Agreement will in no way affect any other provision.
Section 8.13 Time. Time is of the essence in this Agreement. Whenever the date
on which an action must be performed falls on a Saturday, Sunday or federal holiday, the
date for performance will be deemed to be the next succeeding business day,
Section 8.14 Further Assurances. Borrower agrees to: (a) pursue in an effective
and continuous manner; (b) use best efforts to achieve; and (c) take all actions reasonably
required by the City from time to time to confirm or otherwise carry out the purpose of this
Agreement.
Section 8.15 Consent. Except as expressly provided otherwise, whenever consent
or approval of a party is required in any Loan Document, that party agrees not to withhold
or delay its consent or approval unreasonably.
Section 8,16 Counterparts. This Agreement may be executed in any number of
counterparts, all of which will constitute but one agreement.
Section 8.17 Borrower's Personnel. The operation of the Project shall be
implemented only by competent personnel under the direction and supervision of
Borrower.
Section 8.18 Exhibits. All exhibits attached hereto ate incorporated into and
hereby made a part of this Agreement.
55394.00049W884 no.6 19
A-2020-265-06
WHEREAS, this Agreement has been entered into by the undersigned as of the date first
above written.
CITY:
CITY OF SANTA ANA
By:
Kristine Ridge, City Manager
Attest:
"
*( Clerk of the CoifticiK�!VI/I
APPROVED AS TO FORM:
BY %, �
ty Attorney p
BORROWER:
VADA
55394.00049W0884170.6 20
CALIFORNIA CERTIFICATE OF ACKNOWLEDGMENT
A notary public h other officer completing this certificate verifies only the identity of
the individual who signed the document to which this certificate is attached, and not
the truthfulness, accuracy, or validity of that document.
State of California )
Countyof
On U� cX t/Ly before me,
nn (here Insert a e and title of the officer)
personally appeared \ Urr/JQ QiJ ' Y rc, h
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
lam.• YVETTE P..TUGAL
COMM. #2322245 Z
p = Notary Public • California
z'
orange County °
M Comm. Ex Tres Mar, 3 2024
(Seal)
Optional Information
Although the information in this section is not required bylaw, it could prevent fraudulent removal and reattachment of this acknowledgment to an
unauthorized document and may prove useful to persons relying on the attached document.
Description of Attached Document
The preceding Certificate of Acknowledgment is attached to a document
titled/for the purpose of
containing pages, and dated
The signer(s) capacity or authority is/are as:
❑ Individual(s)
❑ Attorney -in -Fact
❑ Corporate Officer(s)
ritlelsl
❑ Guardian/Conservator
❑ Partner-Limited/General
❑ Trustee(s)
❑ Other:
representing:
Namels) of Persons) or Entlty(les) Signer is Representing
Method of Signer Identification
Proved to me on the basis of satisfactory evidence:
O form(s) of Identification O credible witness(es)
Notarial event is detailed in notary journal on:
Page # Entry N
Notary contact:
❑ Additional signers) ❑ Signeds)Thumbprinds)
El
C Capynght 2007-2018 Notary Rotary, PO 8or 41400, Oee Nlo.n., IA 50311 0507. All Rights Reserved Ile. Number 101772 Please [Omacl your P.vNorizetl Reseller m purchase copies or nits fmm.
EXHIBIT "A"
PROPERTY LEGAL DESCRIPTION
All of that certain real property situated in the State of California, County of Orange, City
of Santa Ana, described as follows:
Parcel 1:
All of Lots 2,3,6 and the northerly 20.00 feet of Lot 5 in Block 11 and all of Lots 1,
2, 3, 4, 5 and 6 in Block 12 of the town of Santa Ana, as shown on a map recorded
in Book 2, Page 51 of miscellaneous records of Los Angeles County, California.
Together with that portion of Sycamore Street, 60.00 feet wide, as shown on said
map, as vacated and described in that certain resolution No, 82-17 of the city council
of the City of Santa Ana, a certified copy of which was recorded February 11, 1982,
as Document No. 82-051577 of official records of Orange County, California,
bounded southerly by the north line of Third Street, 60.00 feet wide, and bounded
northerly by a line parallel with and distant northerly 140.00 feet, measured at right
angles, from said north line of Third Street.
Excepting therefrom the easterly 15.00 feet of said Lot 3 in said Block 11.
Parcel 2:
A perpetual easement for ingress and egress over the south 2.50 feet of the east 15.00
feet of Lot 3 in Block I of the town of Santa Ana, as shown on a map recorded in
Book 2, Page 51 of miscellaneous records of Los Angeles County, California, as
reserved in the deed to J. E. Lieberg et al., dated June 5, 1923 and recorded in Book
475, Page 362 of deeds, records of Orange County, California.
Parcel 3:
The right to use that portion of a brick wall of the building on Lot I in Block 11 of
the town of Santa Ana, as per map recorded in Book 2, Page 51 of miscellaneous
records of Los Angeles County, California, which adjoins the east boundary line of
the south 25.00 feet of Lot 2 in said Block 11, as a party wall, as granted by that
certain agreement, dated July 1, 1919 by and between H, R. Andre, also known as
Roy Andre, et al., as parties of the first part, and L. J. Carden et al., as parties of the
second part recorded August 19, 1919 in Book 341, Page 362 of deeds, records of
Orange County, California.
Subject to covenants, conditions, restrictions and easements of record, if any, and to
the following four (4) reservations, restrictions and easements:
1.) A no building of a habitable structures zone in favor of the City of Santa Ana over
that portion of land in the city of Santa Ana, county of Orange, state of California
more particularly described as follows:
the northerly 15.00 feet of lots 5 and 6, in block 11 and the northerly 15.00 feet of
lots 5 and 6 in block 12 of the town of Santa Ana as shown on a map recorded in book
2, page 51 of miscellaneous records of Los Angeles County, California.
2.) An easement for fire access purposes in favor of the City of Santa Ana over
that portion of land in the city of Santa Ana, cotmty of Orange, state of California
more particularly described as follows:
the northerly 10.00 feet of lots 5 and 6, in block 11 and the northerly 10P00 feet of
lots 5 and 6 in block 12 of the town of Santa Ana as shown on a map recorded in book
2, page 51 of miscellaneous records of Los Angeles County, California.
3.) An easement for operations and maintenance of public utilities (water, sewer,
storm drain) in favor of the City of Santa Ana over that portion of land in the city of
Santa Ana, county of Orange, state of California more particularly described as
follows:
the northerly 20.00 feet of lots 5 and 6, in block 11 and the northerly 24.00 feet of
lots 5 and 6 in block 12 of the town of Santa Ana as shown on a map recorded in book
2, page 51 of miscellaneous records of Los Angeles County, California.
4.) A reservation for private access rights in favor of lots 7 and 8 in block 12 and lots
7 and 8 in block 11 of the town of Santa Ana as shown on a map recorded in book 2
page 51 of miscellaneous records of Los Angeles County, California over that portion
of land in the city of Santa Ana, county of Orange, state of California
more particularly described as follows:
The Northerly 10.00 feet of lots 5 and 6 in block 12 and the Northerly 10.00 feet of
lots 5 and 6 in block 11 as shown on said town of Santa Ana map,
EXHIBIT B
AS PARCEL. NO, 2020-159
AD (Mµ E
WEEA
NIIN THE CITY OF SANTA ANA, COUNTY OF ORANGE, STATE OF CALIFORNIA.
MspuANCE caur"xr
ALL OF LOTS 2' 0 AND A PORTION OF LOTS 0 ANO D N NLOCN 11 "NoALL OF LOTS 1� 2, O,
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RESOLUTION N0. 82-1] OF 7NE CITY COUNCIL OF 7H8 GITV OF 6ANTA ANA, A CERlIREO COPY
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OF WHICH Wp8 R8Cgfl0E0 FEBAM 17 1M82, AS OOCUMENT N0, N2-Dd18)7 fS OFFICIAL
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EYIUN cIFRK-REENRoBR
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Na IN THE CITY OF SANTA ANA, COUNTY OF ORANGE, STATE OF CALIFORNIA.
INSURANCE COMPANY
ALL OF LOTS 2, 0 AND A PORTION OF LOTS a AND 5 IN BLOCK 11 AND ALL OF LOTS 1, 2, DI
DATE
4, 8 AND 8 IN BLOB( 12 OF THE TOWN OF SANTA ANA, AS SHOWN ON A MAP RECORDED IN
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RESOLUTION NO. 82-17 OF THE CITY COUNCIL OF THE C17Y OF SANTA ANA, A CERHRED COPY
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COM CIERR-RECgNER
RECORDS OF ORANGE COUNTY, CALIFORNIA.
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FOR CONDOMINIUM PURPOSES
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DEREK L MCOREGOR, L8, 8406
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Ni BOOK 2 PAGE 87 OF MISCELLANEOUS RECORDS W LOS ANOELE9 COUNTY CALIFORNIA, TOGEMER
WITH VAT PORTION OF SYCAMORE STREET AS YACATRD AND DESCRIBED IN THAT CERTAIN BOGN�..PAN._�
RESOLUTION NO. 82-17 OF THE CITY COI OF THE CITY OF SANTA ANA A CERTIFIED COPY NOON NNpOU�YEN
OF WHICH WAS REWRDEO FEBRUARY 11, USE. AS DOCUMENT NO, 82-N577 OF OFFICIAL 00{INttCI£Rg-REWRDE0.
RECORDS OF ORANGE COUNTY, OALIFORNIA.
FOR 0ONDOWNIUM PURPOSES BY,
OGIOBER, 2022
DMG ENGINEERING
DEREK J. MOGREOCR, 1 BABA
EXISTING
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RECORDS OF OitANGE COUNTY, CAUFORNIh
FOR CONDOMINIUM PURPOSES NnDTY—'-
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EXHIBIT "C"
CITY OF SANTA ANA
PUBLIC IMPROVEMENT LOAN AGREEMENT
D.D.A. and Public Improvement Loan Agreement
-EXHIBIT C"
See See. 2.s.B -City or Santa Ana Public Improvements Loan Agreement (13 million).
Disbursement Process and Scope or Work: Pryor to 24 mo. Construction Timeline (DDA) Start Date,
Est. Schedule, Scope of Work and Disbursement of 13 million City Loan Proceeds Demo Rough Grade to
Street Level / Subterranean Garage Parking as shown in Article 2 of the Loan Agreement (See Site Plan,
work CIS & Cut Sections attached to Exhibit 2.
1. Remove / Repair existing underground utilities at alley easement area; cr North end of Property -
Remove all existing abandoned or to be replaced utilities from back of 411' St, buildings North or3" r
and Broadway. This includes Existing Storm Drain Removal & Replacement of Underground
Water, Electrical, Systems. Construct Drainage Sub Grade In place for Water Runoff and any Fire
Life Safety Retrofit (If Any) all underground utilities R/R prior to demolition. (Safe Off Demo
Area), SCE Engineering Drawings prior to Demo - Est, 9 months,
2. Pedestrian Safety, Security renting- Street Closures, Security Guard Service (24I7) and Barricades
per City Standards and DDA, (See City Plan throughout Construction Project.
3. Major Demo - Existing Concrete Parking Structure /Sawcut Extraction & Removal.
4. Shoring of the Subterranean Entire Project Footprint to Rough Grade Elevation,
S. Excavate Construction Site Plan Area through Foundation Permit (Rough Grade to Footing).
6, Excavate down to grade level. Remove Export Dirt- Ramp up - Truck Loading Area
7, Install tower Crane (x2) Foundation Pads,
8. Cut Back Shoring to START Subterranean Garage to Street Level per DDA (Loan Article 2) Rough
Grade Subterranean to START Construction or Build out Time per DDA to I3 million (See Items I
through 8 above).
Est Time1 ine per each above item to be Completed & actual Cost to Construct each. T.B.D. as
We are out to bid for these Tasks -- as of November 1st, 2022.
We will have a Cost Breakdown prior to Commencement of Work, Hope rully prior to December
31, 2022.
9, Construction of the Public Parking Parcel within the 10 Story Parking Structure containing 444
Parking spaces. DDA article 2/Articles 1, I.I,D-P-3 Public Improvement Loan Agreement.
10, Construction of Subterranean Garage Complete to Street Level.
It, Construction of the Private Street Reconnecting Sycamore St. between 3" and'Ii° Streets.
12. Articles 1, 1. LD-P-3 Public Improvement Loan Agreement, (See Critical Path Chat &
Construction for Est. Timeline and Disbursements Schedule (see attached),
Loan Agreement Note: (Article 1) See 1.1-d Exhibit "C"
1, Demo
2. Foundation Permit needed for Rough Grade (See Breakdown above items 1.8)
3. Construction of Public Parking Parcel Hotel
4. Construction of PVT. Street Reconnecting Sycamore Street between 31 & 411 St.
D.D.A. Note: (Article 2) 2.1.10 (13m) (See items I - I V),
I. Demo.
2. Prep, Project through Rough Grading Permit & Construction through Rough Grading,
3. Construction on Parcel "A" Public Parking Parcel containing 211 Parking Spaces -
Subterranean Garage per D.D.A. / Loan agreement.
4. Construction of Private Street Sycamore Between 3111 & 01 Streets per D.D.A. / Loan agreement.
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EXHIBIT D
FORM OF PROMISSORY NOTE
Not to Exceed
$13;0001000
December 6, 2022
Santa Ana, California
FOR VALUE RECEIVED, CARIBOU INDUSTRIES, INC. a Nevada Corporation ("Maker"),
having an address of 1103 North Broadway, Santa Ana, CA 92701, promises to pay to the CITY
OF SANTA ANA, a California charter city in the County of Orange of the State of California
("Holder"), the principal sum of THIRTEEN MILLION DOLLARS ($13,0001000.00), or so
much of said amount which may be advanced from time to time, plus interest accrued at the rate
set forth herein .
1. Background. This Promissory Note ("Note") is made pursuant to that certain City of
Santa Ana Public Improvement Loan Agreement with Caribou Industries, Inc. (Downtown Hotel
and Mixed -Use: Residential and Retail/Commercial Project at 3rd and Broadway) (the "Loan
Agreement"), dated December 6, 2022, by and between Maker and Holder, whereby Holder
made a loan (the "Loan") to Maker, in the amount not to exceed Thirteen Million Dollars
($13,000,000.00), to pay certain costs associated with the construction and installation of City
Funded Improvements that were required as conditions of regulatory approval for the
development of develop Mixed Use Project including an apartment complex with 171 residential
units, 13,419 square feet of commercial space, and 196 residential parking spaces ("Mixed Use
Project'), and a Hotel Project containing seventy-five (75) hotel rooms, on the Property,
including eighty-three (83) parking spaces which includes forty-two (42) stacking parking spaces
("Hotel Project") on the Property. (The "Mixed Use Project" and Hotel Project" are hereinafter
refereed to collectively as "Project."), as defined in the Loan Agreement, upon that certain
Property located in the City of Santa Ana, California (the "Property"), as more particularly
described in the Loan Agreement. This Note evidences the Loan and Maker's repayment
obligations to Holder thereunder. All capitalized terms used but not defined in this Note shall
have the meanings given to them in the Loan Agreement.
2. Payment.
(a) If the City funds the Public Improvement Loan from the City's General
Fund, the following shall apply:
(i) The term of the repayment shall be thirty (30) years from the date
when the Holder first issued Loan Funds to Maker in accordance with Loan Agreement.
(ii) Commencing on the date Holder first issued Loan Funds to Maker
until the date on which the Public Parking Parcel is made available to the public pursuant to the
Parking Agreement, Maker shall pay monthly interest -only payments to Holder equal to all then
accrued but unpaid interest on the outstanding principal amount.
55394.00049\40884170.6
(iii) Commencing on the date on which the Public Parking Parcel is
made available to the public pursuant to the Parking Agreement, Maker shall make monthly
principal and interest payments under this Note until the principal and accrued interest under this
Note is repaid in full, The full atnount of principal and interest accrued under this Note shall be
due and payable in full not later than 30 years from the date when Holder first issued Loan Funds
to Maker (the "Maturity Date").
(b) If the Public Improvement Loan is funded by the City through a Private
Loan, the Loan shall be repaid pursuant to the terms of that Private Loan,
(c) Maker shall have the right to prepay without penalty all or any portion,of
the principal amount evidenced hereunder.
(d) All payments and prepayments received by Holder pursuant to the terms
hereof shall be applied in the following manner: first, to the payment of all expenses, charges,
costs and fees incurred by or payable to Holder by Maker pursuant to the terms hereof (in such
order and manner as Holder, in its sole discretion, may elect); second, to the payment of all
interest accrued to the date of such payment; and third, to the payment of principal;
Notwithstanding anything to the contrary contained herein, after the occurrence and dining the
continuation of an Event of Default (as hereinafter defined); all amounts received by Holder
from any party shall be applied in such order as Holder, in its sole discretion, may elect.
3. Interest Rate. The principal outstanding under this Note shall accrue interest at the rate
of either (a) if the City makes the Public Improvement Loan is funded from the City's General
fund, the interest rate shall be Local Agency Investment Fund (LAIF) rate beginning on the date
of this Note until the date the Loan is repaid in full, the interest rate shall readjust July lst of
each year; or (b) if the Public Improvement Loan is funded by the City through a Private Loan,
the interest shall be the rate charged pursuant to the terms of that Private Loan....
4. Security. This Note is secured by a Deed of Trust executed by Maker, which creates a
lion on that certain property owned by Caribou Industries, Inc. as described in the Deed of Trust
and the Loan Agreement.
5. Events of Default. Any of the following events shall be deemed an "Event of Default" `
hereumder:
due;
(a) Failure to make any payment of interest or principal on this Note when
(b) Maker shall fail to satisfy any obligation under this Note;
(e) Maker shall become in default under the Loan Agreement, subject to any
applicable cure periods set forth therein;
(e) Maker shall file a.voluntary petition in bankruptcy court or such a petition
shall be filed against Maker and is not dismissed within sixty (60) days after filing; or if Maker
shall file any petition or answer seeking or acquiescing in any reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief for itself under any present or
55394.00049\40884170.6
future federal, state or other statute, law or regulation relating to bankruptcy, insolvency or other
relief for Maker or Maker seeks or consents to or acquiesces in the appointment of any trustee,
receiver or liquidator of Maker or shall make any general assigmnent for the benefit of creditors,
or shall admit in writing its inability to pay its debts generally as they become due;
(f) A court of competent jurisdiction shall enter an order, judgment or decree
approving a petition filed against Maker seeking any reorganization, dissolution or similar relief
under any present or future federal, state or other statute, law, or regulation relating to
bankruptcy, insolvency or other relief for Maker and such order, judgment or decree shall remain
unvacated and unstayed for an aggregate of sixty (60) days (whether or not consecutive) from the
firsv date of entry thereof; or any trustee, receiver or liquidator of Maker shall be appointed
without the consent or acquiescence of Maker and such appointment shall remain unvacated and
unstayed for an aggregate of sixty (60) days (whether or not consecutive);
(g) Maker dissolves, any member withdraws from Maker or any other
termination of Maker's existence as a going concern occurs; or
(h) A material adverse change occurs in Maker's financial condition or Holder
believes the prospect of payment or performance of this Note is impaired.
6. Remedies.
(a) Acceleration, Upon the occurrence of an Event of Default, and without
Actnand on or notice to Maker or any other party, all amounts payable by Maker hereunder shall
immediately become due and payable in full.
(b) No Waiver. Holder's acceptance of interest at the Default Rate shall not
have the effect of curing any Event of Default and shall not prejudice the right of Holder to
collect any other amounts required to be paid or to declare a default under any of the "Loan
Documents," as defined in the Loan Agreement. No delay or omission on the part of Holder in
exercising any right or remedy under this Note or any other Loan Documents shall operate as a
waiver of such right or remedy or Holder's right to exercise same at any tirne.
7. ]Default Rate, Upon the occurrence of an Event of Default, at the option of Holder, all
amounts then unpaid under this Note shall bear interest from the date.of default until such default
is cured at a rate of interest (the "Default Rate") equal to ten percent (10%) per annum and shall
be immediately due and payable. Holder's acceptance of interest at the Default Rate shall not
have the effect of curing any Event of Default and shall not prejudice to the right of Holder to
collect any other amounts required to be paid or to declare a default under this Note. No delay or
omission on the part of Holder in exercising any right or remedy under this Note shall operate as
a waiver of such right or remedy or Holder's right to exercise same at any time.
8. No Waiver. The acceptance of any payment hereunder which is less than payment of all
amounts then due and payable shall not constitute a waiver of any of the rights or options of
Holder or to the exercise of those rights and options at the time of such acceptance or at any
subsequent time. No waiver by Holder of any right or remedy shall be effective unless in writing
and signed by Holder, and no such waiver, on one occasion, shall be construed as a waiver on
any other occasion. Maker waives any right of offset now or hereafter existing against Holder,
MPI,![Uf11L Spit, a1:151Yr11N.
9. Time of the Essence, Time is of the essence in the performance of each provision
hereof:
10. Notices, Any notice, demand, request or other communication that any party hereto may
be required or may desire to give hereunder shall be in writing and shall be deemed to have been
properly given (a) if hand delivered, when delivered, (b) if mailed by United States mail,
certified or registeted,.postage prepaid, two (2) business days after .mailing, or (c) if by Federal
Express or other reliable overnight courier service, on the next business day after delivered to
such- courier service, at -the address set forth below or at such other address as the patty to be
served with notice may have furnished in writing to the party seeking or desiring to serve notice
as a place for the service of notice,
To Holder: City of Santa Ana
20 Civic Center Plaza (M-30)
P,O. Box 1988
Santa Ana, CA 92701
Attention: City Clerk
with a copy to: City of Santa Ana
20 Civic Center Plaza (M-29)
P.O. Box 1988
Santa Ana, CA 92701
Attention: City Attorney
To Maker: Caribou Industries, lnc.
1103 North Broadway
Santa Ana, CA 92701
Attention: Mike Harrah
with a copy to: Rutan & Tucker, LLP
18575 Jamboree Road, 9t" Floor
Irvine; CA 92612
Attention: John A. Ramirez
11. Certain Waivers. Maker hereby waives for itself and any person or entity who now or
may hereafter become liable with respect to this Note, to the fullest extent permitted by law,
diligence, presentment, protest and demand, notice of dishonor and all other notices and demands
without in any way affecting the liability of Maker and any other person or entity who now or
may hereafter become liable with respect to this Note. Maker further waives, to the full extent
permitted by law, the right to plead any and all statutes of limitations and the right to require
Holder to marshal assets,
12, Severability. Every provision of this Note is intended to be severable. In the event any
term or provision hereof is declared by a court of competent jurisdiction to be illegal, invalid or
unenforceable for any reason whatsoever, such illegality, invalidity or unenforceability shall not
55394.00049\4088400.6
affect the balance of the terms and provision hereof, which terms and provisions shall remain
binding and enforceable, and this Note shalt be construed as if such illegal, invalid or
unenforceable provision had not been contained herein.
13. Interpretation. In this Note, the singular shall include the plural and the maseuline-
gender shall include the feminine and neutor genders, and vice versa, if the context so requires.
The captions and headings in this Note are merely for convenience and substantively are not a
part of this Note.
14. U.S. Dollars. All sums payable hereunder shall be payable in the lawful money of the
United States of America,
15. Governing Law. This Note is governed by the law of the State of California, without
giving effect to conflicts of laws principles.
16. Enforcement Costs. in the event of (a) any action or proceeding that involves the
protection, preservation or enforcement of Holder's rights or Maker's obligations under this Note
(including, but not limited to, Holder's defense of any action by Maker in connection with the
loan evidenced hereby), (b) Holder's collection or enforcement without, institutionof litigation
proceedings, or (c) Holder's participation in any proceeding which is authorized under the terms
of this Note, Holder shall be entitled to payment, upon demand, from Maker of all costs and
expenses associated therewith, including reasonable attorneys' fees and litigation expenses.
Maker will pay Holder, upon demand, all reasonable attorneys' fees and expenses incurred in the
representation of Holder in any aspect of any bankruptcy or insolvency proceeding initiated by or
on behalf of Maker that concerns any of its obligations to Holder under this Note. In the event of
a judgment against one party concerning any aspect of this Note, the right to recover post -
judgment attorneys' fees incurred in enforcing the judgment shall not be, merged into and
extinguished by any money judgment. The provisions of this Section constitute a distinct and
severable agreement fibm the other contractual rights created by this Note.
[Signatures on foiiowingpage]
55194.00049W0884170,6
SIGNATURE PAGE FOR PROMISSORY NOTE
IN WITNESS WHEREOF, Maker has executed this Note as of the year and date first set forth
above.
MAKER:
55394.00049140884170.6
r
CALIFORNIA CERTIFICATE OF ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of
the Individual who signed the document to which this certificate is attached, and not
the truthfulness, accuracy, or validity of that document.
State of California
County of 10 ftw )
On 'as'�^
C/G_/� before me,
1 ' f there Insert name nd title of the officer)
G
personally appeared j�/1 l Cy t(�(�? �. 1(irVl
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. YVETTE PORTUGAL
o COMM. *2322245 z
a r 'ab Notary public California
WITNESS my hand and official seal. z orange County °
�l M Comm. Ex Tres Mar. 3, 2024
Signature
(Seal)
Optional Information
Although the information in this section Is not required by law, it could prevent fraudulent removal and reattachment of this acknowledgment to an
unauthorized document and may prove useful to persons relying on the attached document.
Description of Attached Document
The preceding Certificate of Acknowledgment is attached to a document
titled/for the purpose of
containing pages, and dated
The signer(s) capacity or authority Ware as:
❑ Individual(s)
❑ Attorney -in -Fact
❑ Corpo(ateofficer(s)
❑ Guardian/Conservator
❑ Partner - Limited/General
❑ Trustee(s)
❑ other:
representing: _
Name(sl of Pe,,ci or EntiryDrO Signer Is Nepresenting
Method of Signer Identification
Proved to me on the basis of satisfactory evidence:
0 fermis) or identification 0 credible wimeate5)
Notarial event is detailed in notary journal on:
Page 4 Entry 4
Notary contact:
Other
❑ Additional 5igneds) ❑ 5igneds)Thumbprinns)
C Copyright 2007-201e Notary Fotaiy. PO aos 41400. Des Mains. IA 59311 D507 All Fights aese,ved. Item Number 101772. Piease contact you, Autho,i,ed Nesell,, or purchase roPlee of rhis form.
EXHIBIT E
FORM OF DEED OF TRUST
5 53 94.00049\408 94170.6
I
Recording Requested by
Fidelity National Tide
RECORDING REQUESTED' PURSUANT
TO GOVERNMENT
CODE SECTION 27383
When Recorded Mail To:
City of Santa Ana
20 Civic Center Plaza (M-30)
P.O. Box 1988
Santa Ana, CA 92701
Attention: City Clerk
Recorded in Official Records, Orange County
Hugh Nguyen, Clerk -Recorder
I1111III111I II1[I111IIIIIIIIII11I 111111IIIIIIIII[II11III I NO FEE
*$ R 0 0 1 4 1 0 4 1 8 0 $ *
20220004034412:56 pm 12/09/22
340 NC-5 D11 S02 9
0.00 0.00 0.00 0.00 24.00 0.00 0.000.000.00 0.00
DEED OF TRUST AND SECURITY AGREEMENT
THIS DEED OF TRUST AND SECURITY AGREEMENT ("Deed of Trust") is made this 6th day
of December, 2022, among the Caribou Industries, Inc. a Nevada Corporation ("Trustor"),
whose address is 1103 North Broadway, Santa Ana, CA 92701, Fidelity National Title
("Trustee"), whose address 4400 MacArthur Blvd., Suite 200, Newport Beach, CA 92660, and the
City of Santa Ana ("Beneficiary'), whose address is 20 Civic Center Plaza, Santa Ana, CA 92701.
Trustor irrevocably grants, conveys, transfers and assigns to Trustee in trust, with power of sale
and right of entry and possession, all of Trustor's right, title and interest now owned or hereafter
acquired in and to the real property located at 201 West 3ie Street, Santa Ana, California 92701 and
fiulher identified as Orange County Assessor's Parcel Number 398-264-13,as more particularly
described on Exhibit "A", attached hereto and incorporated herein by this reference, together with
all buildings, structures and improvements now existing or hereafter constructed thereon (the
"Improvements") and all other property and interests of any kind or character which may be
reasonably necessary or desirable to promote the present and future beneficial use and
enjoyment of such real property and improvements (the "Property").
1. Secured Obligations. Trustor makes the grant, conveyance, transfer and assignment
herein for the purpose of securing (a) payment of that certain Promissory Note dated on or
about the same date hereof, in the original principal amount of Thirteen Million Dollars
($13,000,000.00) (the "Note"); and (b) due, prompt and complete observance, performance and
discharge of each and every monetary and non -monetary condition, obligation, covenant and
agreement contained herein or contained in that certain City Funded Improvement Loan
Agreement entered into by and between Trustor, Caribou Industries, Inc., and Beneficiary, City
of Santa Ana, and dated December 6, 2022 (the "Secured Obligations").
2. Maintenance and Repair. Trustor shall (a) keep the Property in good condition and
repair and not remove or demolish any building; (b) complete or restore promptly and in good
and workmanlike manner any building which may be constructed, damaged or destroyed; (c) pay
when due all claims for labor performed and materials furnished; (d) comply with all laws
affecting the Property or requiring any alterations or improvements to be made; (e) not commit
55394.0004%40884170.6
Page 1 of 6
or permit waste; and (f) cultivate, irrigate, fertilize, fumigate, prune and do all other acts which
from the character or use of the Property may be reasonably necessary.
3. Insurance. Trustor shall maintain hazard insurance against loss by fire, hazards included
with the term "extended coverage," and any other hazards for which Beneficiary requires
insurance, and liability insurance. The insurance carrier and the insurance policies and amounts
of coverage shall be acceptable to Beneficiary, the liability policy shall name Beneficiary as an
additional insured, and shall require 30 days' prior notice to Beneficiary before the policy is
modified or terminated.
4. Defense of Security.. Truster shall appear in and defend any action or proceeding
purporting to affect the security or the rights or powers of Beneficiary or Trustee, Trustor shall
pay all costs and expenses, including costs of evidence of title and attorneys' fees, in any such
action or proceeding in which Trustee or Beneficiary may appear, and in any suit brought by
Beneficiary to foreclose this Deed of Trust.
5. Payment of Taxes and Liens. Trustor shall pay (a) at least 10 days before delinquency,
all taxes and assessments affecting the Property, including water stock assessments; (b) when
due, all encumbrances, charges and liens, with interest, on the Property, which are or appear to
be prior or superior to this Deed of Trust; and (c) upon demand all costs, fees and expenses of
this Deed of Trust. If Trustor fails to make any payment or to do any act provided for in this
Deed of Trust, then Beneficiary or Trustee may, without obligation to do so, and with or without
notice to or demand upon Trustor, and without releasing Trustor from any obligation under this
Deed of Trust: (i) make or do the same in such manner and to such extent as either may deem
necessary to protect the security, Beneficiary or Trustee being authorized to enter upon the
Property for such purposes; (ii) appear in or commence any action or proceeding purporting to
affect the security, or the rights or powers of Beneficiary or Trustee; (iii) pay, purchase, contest
or settle any encumbrance, charge or lien which in the judgment of either appears to be senior to
this Deed of Trust; and (iv) in exercising any such powers, pay allowable expenses, including
attorneys' fees.
6. Reimbursement of Costs. Trustor shall pay upon demand all sums expended by
Beneficiary or Trustee provided for in this Deed of Trust or allowed by law, with interest from
date of expenditure at the maximum rate allowed by law.
7. No Waiver. By accepting payment of any sum after its due date, Beneficiary does not
waive its right either to require prompt payment when due of all other sums or declare a default
for failure to pay.
8. Reconveyance. That upon written request of Beneficiary stating that the Secured
Obligations have been fulfilled, and upon surrender of this Deed of Trust, Trustee shall
reconvey, without warranty, the property then held hereunder. The recitals of such
reconveyance of any matters or facts shall be conclusive proof of the truthfulness thereof. The
grantee in such reconveyance may be described as "the person or persons legally entitled
thereto."
9. Assignment of Rents. Trustor hereby absolutely and unconditionally assigns to
Beneficiary all of the rents, issues, profits, royalties, revenues, income and other benefits
(collectively, the "Rents") derived from the Property, whether now due, past due or to become
Page 2 of 6
55394.00049W0884170.6
due, and hereby gives to and confers upon Beneficiary, either directly or through a receiver, the
right, power and authority, but not the obligation, to collect the Rents, and to sue, either in the
name of Trustor or Beneficiary, for all such Rents and to apply the same to the indebtedness
secured hereby in such order as Beneficiary may determine in its sole discretion. This
assignment of Rents is intended to create and shall be construed to create an absolute assignment
to Beneficiary of all of Trustees right, title and interest in the Rents; provided, however, so long
as no default exists by Truster in the payment of any indebtedness secured hereby, or in any
other covenant contained herein, or in said note or notes or in any other document eviddncing or
securing such indebtedness, Truster shall have the right to collect all Rents from the Property and
to retain, use and enjoy the same. Upon the occurrence of such a default, without the necessity of
demand or other notice to Truster or any other act to enforce Beneficiary's interest pursuant to
this assignment, Trustor shall have no interest whatsoever in the Rents that are received by
Truster after a default, and all such Rents shall be received and held by Trustor in constructive
trust for Beneficiary and delivered promptly to Beneficiary, or to a court -appointed receiver for
the Property, without the necessity for further notice to, or demand upon, Truster. Upon the
occurrence of such a default and at any time thereafter during the continuance thereof,
Beneficiary may, at its option, send any tenant of the Property a notice to the effect that: (a) a
default has occurred; (b) Beneficiary has elected to exercise its rights under this assignment; and
(c) such tenant is thereby directed to thereafter make all payments of Rents to or for the benefit
of Beneficiary or as Beneficiary shall direct. Any such tenant shall be entitled to rely upon any
notice from Beneficiary and shall be protected with respect to any payment of Rents made
pursuant to such notice, irrespective of whether a dispute exists between Trustor and Beneficiary
with respect to the existence of a default or the rights of Beneficiary hereunder. Any such tenant
shall not be required to investigate or determine the validity or accuracy of such notice or the
validity or enforceability of this assignment. Truster hereby agrees to indemnify, defend and
hold any such tenant harmless from and against any and all losses, claims, damages or liabilities
arising from or related to any payment of Rents by such tenant made in reliance on and pursuant
to such notice.
10, Default and Foreclosure. Upon default by Trustor in performance of any Secured
Obligation, Beneficiary may deliver to Trustee a declaration of default and demand for sale
and of a notice of default and a notice of sale, which notice Trustee shall cause to be filed for record,
Beneficiary also shall deposit with Trustee this Deed of Trust and all documents evidencing the
Secured Obligations and expenditures, if any, secured by this Deed of Trust. Upon default of
any obligation secured by this Deed of Trust and acceleration of all sums due, if any, Beneficiary
may instruct Trustee to proceed with a sale of the Property under the power of sale granted in
this Deed of Trust, noticed and held in accordance with California Civil Code Sections 2924,
et seq., as such statutes may be amended from time to time. Truster waives all rights it may
have to require marshaling of assets or to require sales of assets in any particular order, including
any rights under California Civil Code Sections 2899 and 3433.
11. Substitution of Trustee. Beneficiary, or any successor beneficiary of the Secured
Obligations or of any indebtedness secured hereby, may from time to time, by instrument in
writing, substitute a successor or successors to any Trustee named herein or acting hereunder,
which instrument executed by the Beneficiary and duly acknowledged and recorded in the
office of the recorder of the county or counties where the Property is situated, shall be
conclusive proof of proper substitution of such successor Trustee or Trustees, who shall, without
conveyance from the Trustee predecessor, succeed to all its title, estate, rights, powers and
Page 3 of 6
55394.00049%40884170.6
duties. Said instrument must contain the name of the original Trustor, Trustee and Beneficiary
hereunder, the book and page where this Deed of Trust is recorded and the name and address of
the new Trustee.
12. Successors and Assigns. This Deed of Trust applies to, inures to the benefit of, and
binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and
assigns.
13. Trustee Acceptance. Trustee accepts this trust when this Deed of Trust, duly executed
and acknowledged, is made a public record as provided by law. Trustee is not obligated to notify
any party hereto of pending sale under any other deed of trust or of any action or proceeding in
which Trustor, Beneficiary or Trustee shall, be a party unless brought by Trustee.
14. Further Assurances. Trustor shall, at its own cost and expense, do, execute,
acknowledge, and deliver all and every such further acts, deeds, conveyances, mortgages,
assignments, notices of assignments, transfers, and assurances as Trustee or Beneficiary shall
from time to time require, for better assuring, conveying, assigning, transferring, and
confirming unto Trustee the Property and rights hereby conveyed or assigned or intended now
or hereafter so to be, or which Trustor may be or may hereafter become bound to convey or
assign to Trustee, or for carrying out the intention or facilitating the performance of the terms of
this Deed of Trust, or for filing, registering, or recording this Deed of Trust. Truster shall, on
demand, execute and deliver, and hereby authorizes Trustee and Beneficiary, or either of them,
to execute in the name of Trustor, to the extent it may lawfully do so, one or more financing
statements, chattel mortgages, or comparable security instruments, to evidence more
effectively the lien hereof, Immediately upon the execution and delivery of this Deed of Trust,
and thereafter from time to time, Trustor shall cause this Deed of Trust, and any security
instruments creating a lien or evidencing the lien hereof upon any personal property and each
instrument of further assurance, to be filed, registered, or recorded in such manner and in such
places as may be required by any present or future law in order to publish notice of and fully to
protect the lien hereof upon, and the title of Trustee to, the Property encumbered hereby.
15. Condemnation and Insurance Proceeds. Immediately upon obtaining knowledge of
the institution of any proceedings for the condemnation or other taking of all or any portion of
the Property, or knowledge of any casualty damage to the Property, or damage in any other
manner, Trustor shall immediately notify Beneficiary thereof. Truster hereby authorizes and
empowers Beneficiary as attomey-in-fact for Trustor to make proof of loss, to adjust and
compromise any claim under the insurance policies covering the Property, to appear in and
prosecute any action arising from such insurance policies, to collect and receive insurance
proceeds, and to deduct therefrom Beneficiary's expenses incurred in the collection of such
proceeds; provided, however, that nothing contained in this Section shall require Beneficiary to
incur any expense or take any action hereunder. Trustor hereby authorizes and empowers
Beneficiary, at Beneficiary's option, as attomey4ri-fact for Truster, to commence, appear in and
prosecute, in Beneficiary's or Trustor's name, any action or proceeding relating to any
condemnation or other taking of all or any part of the Property, whether direct or indirect, and to
settle or compromise any claim in connection with such condemnation or other taking, The
proceeds of any award payment or claim for damages, direct or consequential, in connection
with any condemnation or other taking, whether direct or indirect, of the Property, or any part
Page 4 of 6
55394.00049W 08841 T0.6
thereof, or for conveyances in lieu. of the Property, or any part thereof, shall be paid to Beneficiary.
The foregoing powers of attorney are coupled with an interest and are irrevocable. Trustor
hereby authorizes Beneficiary to apply such awards, payments, proceeds or damages relating to
condemnation of the Property and insurance covering the Property, after the deduction of
Beneficiary's expenses incurred in the collection of such amounts, at Beneficiary's option,
subject to the requirements of applicable law and the provisions hereof, to restoration or repair of
the Property or to payment of the sums secured by this Deed of Trust. Beneficiary shall be
under no obligation to question the amount of any compensation, awards, proceeds, damages,
claims, rights of action, and payments relating to condemnation or other taking of the Property or
insured casualty affecting the Property, and may accept the same in the amount in which the
same shall be paid. Trustor shall execute such further evidence of assignment of any awards,
proceeds damages or claims arising in connection with such condemnation or taking or such
insurance as Beneficiary may require.
16. Severability. If any one or more of the provisions contained in this Deed of Trust shall
for any reason be held to be invalid, illegal, or unenforceable in any respect, such invalidity,
illegality, or unenforceability shall not affect any other provisions of this Deed of Trust, but this
Deed of Trust shall be construed as if such invalid, illegal, or unenforceable provision had never
been contained herein or therein, but only to the extent of such invalidity.
17. Estoppel Certificate.. Trustor shall, within ten (10) days of a written request from
Beneficiary, furnish Beneficiary with a written statement, duly acknowledged, setting forth the
sums secured by this Deed of Trust and any right of set-off, counterclaim or other defense which
exists against such sums and the obligations of this Deed of Trust.
18. Due -On -Sale or Encumbrance. If all or any part of the Property, or any interest
therein, or any beneficial interest in Trustor (if Trustor is not a natural person or persons but is a
corporation, partnership, trust, limited liability company or other legal entity), is, in violation
of the City Funded improvement Loan Agreement, sold, transferred, mortgaged, assigned,
pledged, or farther encumbered, whether directly or indirectly, whether voluntarily or involuntarily
or by operational law, Beneficiary may, at Beneficiary's option invoke any remedies permitted
by this Deed of Trust. For avoidance of doubt, this section shall not apply to any transfer,
assignment, or encumbrance permitted by the City Funded Improvement Loan Agreement
and/or the Disposition and Development Agreement referenced therein.
Page 5 of 6
55394.00049\40884170.6
The undersigned Trustor requests that a copy of any Notice of Default and of any Notice of
Sale hereunder be mailed to Trustor at Trustor's address hereinbefore set forth.
TRUSTOR:
CARIBOU INDUSTRIES, INC., A
NEVADA CORPORATION
Page 6 of 6
55394.00049\40884170.6
CALIFORNIA CERTIFICATE OF AC
State of California )
County of RI )
I On rL- �- ?02z
before me, Q
. (here Insert name a d title f the officer)
it . _ i _ t
personally appeared
imsyM
who proved to me on the basis of satisfactory evidence to be the persons) 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(les), 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
YVETTE PORTUGAL
COMM. #2322245 z
z Notary Public • California o
Orange County
@my Comm. Expires Mar, 3, 2024 f
(Seal)
Optional Information
Although the Information in this section is not required by law, It could prevent fraudulent removal and reattachment of this acknowledgment to an
unauthorized document and may prove useful to persons relying on the attached document.
Description of Attached Document
The preceding Certificate of Acknowledgment is attached to a document
titled/for the purpose of
containing pages, and dated
The signer(s) capacity or authority is/are as:
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0 Copyright 2007d01 8 Notary Rotary, PO Box 41400, Des Molnes, IA 50311-0507. All Nights Reserved. Item Numbuf101772. Please contact your Authorized 0eseller to purchase copies of this form.
EXHIBIT "A"
PROPERTY LEGAL DESCRIPTION
All of that certain real property situated in the State of California, County of Orange, City
of Santa Ana, described as follows:
Parcel 1:
All of Lots 2,3,6 and the northerly 20.00 feet of Lot 5 in Block I 1 and all of Lots 1,
2, 3, 4, 5 and 6 in Block 12 of the town of Santa Ana, as shown on a map recorded
in Book 2, Page 51 of miscellaneous records of Los Angeles County, California.
Together with that portion of Sycamore Street, 60.00 feet wide, as shown on said
map, as vacated and described in that certain resolution No. 82-17 of the city council
of the City of Santa Ana, a certified copy of which was recorded February 11, 1982,
as Document No. 82-051577 of official records of Orange County, California,
bounded southerly by the north line of Third Street, 60.00 feet wide, and bounded
northerly by a line parallel with and distant northerly 140.00 feet, measured at right
angles, from said north line of Third Street.
Excepting therefrom the easterly 15.00 feet of said Lot 3 in said Block l 1
Parcel 2:
A perpetual easement for ingress and egress over the south 2.50 feet of the east 15.00
feet of Lot 3 in Block I I of the town of Santa Ana, as shown on a map recorded in
Book 2, Page $l of miscellaneous records of Los Angeles County, California, as
reserved in the deed to J. E. Lieberg et al., dated June 5, 1923 and recorded in Book
475, Page 362 of deeds, records of Orange County, California.
Parcel 3:
The right to use that portion of a brick wall of the building on Lot 1 in Block 1 I of
the town of Santa Ana, as per map recorded in Book 2, Page 51 of miscellaneous
records of Los Angeles County, California, which adjoins the east boundary line of
the south 25,00 feet of Lot 2 in said Block 11, as a party wall, as granted by that
certain agreement, dated July 1, 1919 by and between H. R. Andre, also known as
Roy Andre, et al., as parties of the first part, and L. J. Carden et al., as parties of the
second part recorded August 19, 1919 in Book 341, Page 362 of deeds, records of
Orange County, California.
Subject to covenants, conditions, restrictions and easements of record, if any, and to
the following four (4) reservations, restrictions and easements:
1.) A no building of a habitable structures zone in favor of the City of Santa Ana over
that portion of land in the city of Santa Ana, county of Orange, state of California
more particularly described as follows:
the northerly 15.00 feet of lots 5 and 6, in block I I and the northerly 15.00 feet of
lots 5 and 6 in block 12 of the town of Santa Ana as shown on a map recorded in book
2, page 51 of miscellaneous records of Los Angeles County, California.
2.) An easement for fire access purposes in favor of the City of Santa Ana over
that portion of land in the city of Santa Ana, county of Orange, state of California
more particularly described as follows:
the northerly 10.00 feet of lots 5 and 6, in block I I and the northerly 10.00 feet of
lots 5 and 6 in block 12 of the town of Santa Ana as shown on a map recorded in book
2, page 51 of miscellaneous records of Los Angeles County, California.
3.) An easement for operations and maintenance of public utilities (water, sewer,
storm drain) in favor of the City of Santa Ana over that portion of land in the city of
Santa Ana, county of Orange, state of California more particularly described as
follows:
the northerly 20.00 feet of lots 5 and 6, in block 11 and the northerly 24.00 feet of
lots 5 and 6 in block 12 of the town of Santa Ana as shown on a map recorded in book
2, page 51 of miscellaneous records of Los Angeles County, California.
4.) A reservation for private access rights in favor of lots 7 and 8 in block 12 and lots
7 and 8 in block l I of the town of Santa Ana as shown on a map recorded in book 2
page 51 of miscellaneous records of Los Angeles County, California over that portion
of land in the city of Santa Ana, county of Orange, state of California
more particularly described as follows:
The Northerly 10.00 feet of lots 5 and 6 in block 12 and the Northerly 10.00 feet of
lots 5 and 6 in block 11 as shown on said town of Santa Ana map.