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Subordination Agreement SHOP Loan 2016-0260496LAWYERS TITLE Recording Requested by And When Recorded Mail to: Poway Housing Authority 13325 Civic Center Drive Poway, CA 92064 Attn: City Clerk DOC# 2016- 0260496 May 27, 2016 09:45 AM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $39.00 _____== __- - - - - -- -- SUBORDINATION AGREEMENT SHOP LOAN PAGES:9 NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY INTEREST IN THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT. THIS AGREEMENT (the "Agreement'), is made as of Moq 11, 2-01t? by and among the Poway Housing Authority, a public body, corporate and po itic, hereinafter referred to as "Housing Authority", Nicole N. Lieu Mai and Tuan T. Mai, Wife and Husband as Joint Tenants, hereinafter referred to as "Borrower" and Mission Federal Credit Union, hereinafter described as the "Lender ": WITNESSETH WHEREAS, in order to provide funds to the Borrower in connection with the purchase of a home located at 12934 Metate Lane, Poway, California, which property is legally described in Exhibit A attached hereto (the "Property"), the Poway Redevelopment Agency (the "Redevelopment Agency ") made a loan to Borrower in the original principal amount of $25,492 (the "Subordinate Load'), evidenced by a Promissory Note in favor of the Redevelopment Agency dated December 16, 2009, (the "Note ") and secured by a Deed of Trust and Security Agreement in favor of the Redevelopment Agency (the "Subordinate Deed of Trust'), recorded against the Property in the Official Records of Sari Diego County on December 16, 2009, as Instrument No. 2009 - 0694359 and subordinated on August 6, 2012 as Instrument No. 2012- 0459307. In addition, in connection with the Subordinate Loan, an Occupancy, Refinancing, and Resale Restriction Agreement with Option to Purchase (the "Resale Restriction Agreement') was recorded against the Property in the Official Records of San Diego County on December 16, 2009, as Instrument No. 2009 - 0694357, and a Notice of Affordability Restrictions on Transfer of Property (the "Notice of Restrictions ") was recorded against the Property in the Official Records of San Diego County on December 16, 2009, as Instrument No. 2009 - 0694360. The Subordinate Deed of Trust, the Resale Restriction Agreement and the Notice of Restrictions, together with any and all amendments and modifications thereto recorded in the Official Records of San Diego County in connection with the Subordinate Loan, are hereinafter referred to as the "Subordinate Encumbrances." The Subordinate Encumbrances, the Note, and all other documents evidencing or securing the Subordinate Loan are collectively referred to as the "Subordinate Loan Documents." LAWYERS TITLE Recording Requested by And When Recorded Mail to: Poway Housing Authority 13325 Civic Center Drive Poway, CA 92064 Attn: City Clerk SUBORDINATION AGREEMENT SHOP LOAN NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY INTEREST IN THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT. THIS AGREEMENT (the "Agreement "), is made as of MaV 11, 2.1 1i by and among the Poway Housing Authority, a public body, corporate and politic hereinafter referred to as "Housing Authority ", Nicole N. Lieu Mai and Tuan T. Mai, Wife and Husband as Joint Tenants, hereinafter referred to as "Borrower" and Mission Federal Credit Union, hereinafter described as the "Lender ": WITNESSETH WHEREAS, in order to provide funds to the Borrower in connection with the purchase of a home located at 12934 Metate Lane, Poway, California, which property is legally described in Exhibit A attached hereto (the "Property "), the Poway Redevelopment Agency (the "Redevelopment Agency ") made a loan to Borrower in the original principal amount of $25,492 (the "Subordinate Load'), evidenced by a Promissory Note in favor of the Redevelopment Agency dated December 16, 2009, (the "Note ") and secured by a Deed of Trust and Security Agreement in favor of the Redevelopment Agency (the "Subordinate Deed of Trust "), recorded against the Property in the Official Records of San Diego County on December 16, 2009, as Instrument No. 2009 - 0694359 and subordinated on August 6, 2012 as Instrument No. 2012- 0459307. In addition, in connection with the Subordinate Loan, an Occupancy, Refinancing, and Resale Restriction Agreement with Option to Purchase (the "Resale Restriction Agreement ") was recorded against the Property in the Official Records of San Diego County on December 16, 2009, as Instrument No. 2009 - 0694357, and a Notice of Affordability Restrictions on Transfer of Property (the "Notice of Restrictions ") was recorded against the Property in the Official Records of San Diego County on December 16, 2009, as Instrument No. 2009 - 0694360. The Subordinate Deed of Trust, the Resale Restriction Agreement and the Notice of Restrictions, together with any and all amendments and modifications thereto recorded in the Official Records of San Diego County in connection with the Subordinate Loan, are hereinafter referred to as the "Subordinate Encumbrances." The Subordinate Encumbrances, the Note, and all other documents evidencing or securing the Subordinate Loan are collectively referred to as the "Subordinate Loan Documents." WHEREAS, pursuant to a Cooperation Agreement and an Assignment and Assumption Agreement, both dated March 11, 2011, the Redevelopment Agency has assigned to the Housing Authority, and the Housing Authority has assumed, among other things, the rights of the Redevelopment Agency under the Subordinate Loan Documents. WHEREAS, pursuant to a Loan Agreement dated as of2_, 2016, Mission Federal Credit Union (the "Senior Lender ") is making a loan to Borrower in the amount of $179,300 (the "Senior Loan "). The Senior Loan is secured by that certain Multifamily Deed of Trust dated as of 5'LI -I�which will be recorded in the Official Records of San Diego County concurrently herewith (the "Senior Loan Deed of Trust "). The Senior Loan Deed of Trust and any other instruments or documents which are recorded in connection with the Senior Loan shall be referred to collectively as the "Senior Loan Encumbrances." The Senior Loan Encumbrances and any and all notes, loan agreements, and other documents and instruments executed by Borrower in connection with the Senior Loan shall be collectively referred to as the "Senior Loan Documents." WHEREAS, it is a condition precedent to the Senior Lender providing the Senior Loan that the Senior Encumbrances be unconditionally and at all times remain a lien or charge upon the Property prior and superior to all the rights of the holder of the Subordinate Encumbrances and that the Housing Authority specifically and unconditionally acknowledge that the Subordinate Encumbrances are and shall remain subordinate to the lien or charge of the Senior Encumbrances. WHEREAS, it is to the benefit of all the parties herein that the Senior Loan be made to the Borrower; and the Housing Authority is willing that the Senior Encumbrances shall, when recorded, constitute a lien or charge upon the Property which is unconditionally prior and superior to the lien or charge of the Subordinate Encumbrances. NOW, THEREFORE, in consideration of the mutual benefits accruing to the parties hereto and other valuable consideration, the receipt and sufficiency of which consideration is hereby acknowledged, and in order to induce the Senior Lender to provide the Senior Loan, it is hereby declared, understood and agreed as follows: (1) That Senior Encumbrances, and any renewals, modifications or extensions thereof, shall unconditionally be and remain at all times a lien or charge on the Property described, prior and superior to the lien or charge of the Subordinate Encumbrances; (2) That the Senior Lender would not provide the Senior Loan without this Agreement; and, (3) That with regard to the priority of the Subordinate Encumbrances, this Agreement shall be the sole and only agreement with regard to the subordination of the lien or charge of the Subordinate Encumbrances to the lien or charge of the Senior Encumbrances and shall supersede and cancel any prior agreements as to such subordination including, but not limited to, those provisions, if any, contained in the Subordinate Deed of Trust, which provide for the subordination of the lien or charge thereof to another deed or deeds of trust, another mortgage or mortgages, or any other property use restrictions or covenants. 0 THE HOUSING AUTHORITY hereby declares, agrees and acknowledges that: (a) It consents to all provisions of the Senior Documents and of any and all other agreements, including but not limited to any escrow instructions or agreements, relating to the disbursement of the proceeds of Senior Loan that have been submitted to Housing Authority for its review (collectively, "Disbursement Provisions "); (b) The Senior Lender, in approving any disbursements pursuant to any such Disbursement Provisions, is under no obligation or duty to, nor has the Senior Lender represented that it will, see to the application of such proceeds by the person or persons to whom the proceeds are disbursed and any application or use of such proceeds for purposes other than those provided for in the Senior Documents shall not defeat the subordination herein made in whole or in part; and, (c) It intentionally and unconditionally subordinates the lien or charge of the Subordinate Encumbrances in favor of the lien or charge upon the Property of the Senior Encumbrances and understands that in reliance upon, and in consideration of, this subordination, specific loans and advances are being and will be made and, as part and parcel thereof, specific monetary and other obligations are being entered into which would not be made or entered into but for said reliance upon this subordination. (d) Upon any event of foreclosure of the Subordinate Deed of Trust, whether by power of sale or by court action, or upon a transfer of the Property in lieu of foreclosure, such foreclosure shall not be deemed an event of default under any of the Senior Loan Documents provided that the Housing Authority or any assignee of its rights or transferee of the Property agrees to assume all of Borrower's obligations under the Senior Loan Documents within ninety (90) days of such foreclosure and thereafter complies with all terms of the Senior Loan Documents. (e) Notwithstanding anything to the contrary contained in the Subordinate Loan Documents, prior to the Housing Authority declaring any default or taking any remedy permitted against the Borrower under the Subordinate Loan Documents or applicable law based upon an alleged default under the Subordinate Loan Documents, the Housing Authority shall give notice to the Senior Lender of such alleged default, and the Senior Lender shall have a period of not less than ninety (90) days to cure such alleged default. Notwithstanding the foregoing, other than the appointment of a receiver to collect monies owing from the Borrower, the Housing Authority may take any reasonable action it deems necessary or appropriate in good faith to protect its security. Notices of any default by the Borrower under the Subordinate Loan Documents shall be given to the Senior Lender at the following address: Mission Federal Credit Union 10393 Spring Canyon Road, Suite A San Diego, CA 92131 3 (f) Concurrently with a notice from the Senior Lender to the Borrower that a default or breach exists under the terms of any of the Senior Documents, Senior Lender shall send a copy of such notice to the Housing Authority and the Housing Authority shall have thirty (30) days to cure such default. The Senior Lender will not exercise any of its remedies against Borrower or the Property during any applicable cure period set forth herein beginning after the date such notice is given to Senior Lender, except that Senior Lender may take any reasonable action it deems necessary or appropriate in good faith to protect its security. During such cure period the Housing Authority and the Senior Lender shall have the right to negotiate with the party giving the notice of default, provided that, notwithstanding (a) any discussions or negotiations between the parties, (b) any other provisions of this Agreement, or (c) any claim of any party to the contrary, Senior Lender has not waived, and does not waive, any of its rights or remedies under the Senior Documents and Senior Lender expressly reserves all of its rights and remedies under the Senior Documents whether or not any such negotiations or discussions are taking place. Notwithstanding anything to the contrary in this Agreement, any indebtedness and any other amounts secured by the Senior Encumbrances may be accelerated and become immediately due and payable in accordance with the terms of the Senior Lender Deed of Trust or any other Senior Documents and a notice of default may be recorded in the applicable governmental office immediately upon the occurrence of a default and expiration of any applicable notice and cure periods set forth in the Senior Documents, provided, however, that if the underlying default giving rise to such acceleration is a monetary default, the Housing Authority and Borrower shall be deemed to have cured the default by tendering payment of all amounts then due as if no acceleration of any indebtedness had occurred. Notices of any default by the Borrower under the Senior Loan Documents shall be given to the Housing Authority at the following address: Poway Housing Authority 13325 Civic Center Drive Poway, California 92064 Attention: Development Services, SHOP Program (g) After a default under the Senior Documents, but prior to a foreclosure sale or deed in lieu assignment of the Property, the Housing Authority shall have the right to purchase the Property from the Borrower and pay all amounts due and owing under the Senior Documents. (h) The provisions of the foregoing paragraph are intended to supplement, and not to limit, waive, modify or replace, those provisions of law pertaining to notice and cure rights of Subordinate lenders including, without limitation, those set forth in California Civil Code §§ 2924b and 2924c. 4 IN WITNESS WHEREOF, parties hereto have signed this Agreement as of the day and year first above written. POWAY HOUSING AUTHORITY: By: Daniel Singer, Executiv irector MISSION FEDERAL CREDIT UNION: By: �� a4 Diana Clegg, Vice FVeslident of Real Estate Operations Loan Administration BORROWER(S): By: - �k". Nicole N. Lieu Mai By: 1 Tuan T. Mai ALL SIGNATURES MUST BE NOTARIZED 5 California All- Purpose Acknowledgment CIVIL CODE § 1189 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. L11r_rIM•iI &K-AlI10]10 m COUNTY OF SAN DIEGO On Mary 17, 2016 before me, Carol S. Legg, Notary Public, personally appeared Daniel Singer, who proved to me on the basis of satisfactory evidence to be the person(54 whose name4s4 is /a4ze subscribed to the within instrument and acknowledged to me that he /s4e /t#ey executed the same in his /4ef /t#e4 authorized capacity(+es), and that by his /4ef /4w4 signatures on the instrument the person(s4, or the entity upon behalf of which the person44 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. CAROL S. LEGG Commission #t 2105416 Z ti Notary Public - California San Diego County Comm. Ex ices Apr 28, 2019 OPTIONAL &5d j 4i 2 Carol S. Legg, Notary Publ Title or type of document: Subordination Agreement SHOP Loan Document Date: Not dated Number of Pages: Six, including Exhibit A Signers Other Than Named Above: To be signed by borrowers — Nicole N. Lieu Mai and Tuan T. Main, and also by Diana Clegg of Mission Federal Credit Union. i i i� A notary public or other officer compieting this certificate verifies attache the i en oT the individual who signed the document to which this certificate is attached, and not the nrrcur,cy. or validitY of that (Jocument. State of California �P-9 V Count; of '50L-r"- me C h le I S574'r A- On S& 1 1Z I Co before Notary Public, Pcrscmlly gTearrd fvlolie A) . 7UA,, 77 At who proved to me on the basis of satisfactory cvi3cncc la be the pe�sonSsLwhase names is/ar�sbisher/t ix nt and acknowledged to me that he /sheithey executed the same in hislhcr /their /their signaiure�s) on the inst� pemn(s or the enthy the thorized cap - iitty(ies a nd that by his/her__ the ) . upon behalf of which the person(s) acted, executed the insteum tate of Calif I cep. under PENAJ.TY OF PERJURY under ncc laws of the Sornia that flit foregoing puag:[-,ph is trot and correct. WITNFSS my hand and official seal, atary b! My commission expires.' CHRISTINA ELY (*)NCpidM. # 2078053 OTARY PUBLIC' CALIFORNIA SAN DIEGO COUNTY OMM. EXPIRES AUG 28, 2018 1 CALIFORNIA ALL PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document, to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA } COUNTY OF 50.V� pp t `- 0 } A On 1 V `O-U R 3 1 3Z0 14:1 before me p O r 1 �rGe Notary Date ` Insert Name and Title of the officer Public, personally appeared y t 0"V\0. C. e-�j q Name(s) of Signer(s) who proved to me on the basis of satisfactory evidence to be the person(?) whose name(t is /am- 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 /tkeirsignature($) on the instrument the person(, or the entity upon behalf of which the person(t6) 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. DEBORAH A. PURCELL Commission # 2077440 = i Notary Public - California San Diego County Signat M Comm. Expires Aug 12, 2018 U- '��4 -------- - -- OPTIONAL ------------------------------------------------ Though this section is optional, completing this information can deter alteration of the document or fraudulent attachment of this form to an unintended document. Description of Attached Document � rQe -1Me y-,-t 5V-0p Title or Type of Document: 5 or k'-^ % Document Date: Number of Pages: Signer(s) Other Than Named Above: Capacity(ies) Claimed by Signer(s) Signers Name: ❑ Corporate Officer - Title(s) ❑ Partner - ❑ Limited ❑ General ❑ Individual ❑Attorney in Fact ❑ Trustee ❑Guardian or Conservator ❑ Other: Signer is Representing: Signers Name: ❑ Corporate Officer - Title(s) ❑ Partner - ❑ Limited ❑ General ❑ Individual ❑Attorney in Fact ❑ Trustee ❑Guardian or Conservator ❑ Other: Signer is Representing: I . • EXHIBIT A LEGAL DESCRIPTION APN 317 - 350 -44 -00 That certain property situated in the State of California, County of San Diego, City of Poway, described as follows: LOT 5 OF CITY OF POWAY TRACT NO. 06 -06 THE MEADOWS, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 15743 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY MARCH 5, 2009. END OF LEGAL DESCRIPTION C