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HomeMy WebLinkAboutCatholic Charities; 1997-09-09;NOTE TO BORROWER: This Note is not assumable. PROMISSORY NOTE Secured by a Deed of Trust September 9, 1997 Carlsbad California [City] [State] 2476-2478 Impala Drive [Property Address] jthe “Property”). 1. Borrower’s Promise To Pay. For value received, the undersigned Catholic Charities, A Communitv Ministry of the Diocese of San Dieqo, a California nonprofit corporation, (the “Borrower”) promises to pay to the Citv of Carlsbad, a municipal corporation (the “City”), or order, at the Housing and Redevelopment Department, 2965 Roosevelt Street, Suite B, Carlsbad, California 92008, or such other place as the City may designate in writing, the principal sum of $200,000 (the “principal”). The City or anyone who takes this Note by transfer and who is entitled to receive payments under this Note is called the “Note Holder.” (a) Use Of Funds. Borrower is purchasing the real property located at 2476-2478 Impala Drive in the City of Carlsbad. This Note evidences the loan made by the City to assist Borrower in purchasing the Property for operation of a homeless shelter and/or supportive services consistent with the requirements of permits governing its use. The full purchase price (i.e. the gross purchase price) of the Property is $362,500. 2. Definitions. The terms set forth is this Section shall have the following meanings in this Note. (a) “Security Instrument” shall mean the Deed of Trust and Security Agreement, sometimes herein referred to as Deed of Trust, executed concurrently herewith and recorded in the Office of the San Diego County Recorder as document no. 1997-0466871 (b) “Transfer” shall mean any sale, assignment or transfer, voluntary or involuntary, of any interest in the Property. Any transfer without satisfaction of the provisions of this Note is prohibited. 3. Security. This Note is secured by a deed of trust dated the same date as this Note (the “Deed of Trust”). 4. Interest. There will be no interest charged on the Loan. 5. Term. The term of this Note shall mean the period commencing on the date of this Note and expiring on the date twenty (20) years thereafter, the date the Property is sold or transferred, or failure of Borrower to operate a homeless shelter and/or supportive services on the Property consistent with the requirements of permits governing the use of the facility and Borrower’s application to the City requesting financial assistance, whichever occurs first. The term of this Note may be extended by mutual agreement of the parties, if determined necessary and appropriate based upon the housing and social services needs of the City, and as agreed upon by both the City and Borrower. 6. Payments (a) Time and Place of Payments. The principal amount of this Note shall be due and payable in full upon the first of the following to occur after the date of this Note: (i) acceleration of the Note in the event of a default of the Security Instrument, (ii) the date 20 years after the date of this Note, (iii) the date of the first sale or transfer of the Property, or (iv) failure of Borrower to operate a homeless shelter and/or supportive services on the Property consistent with the requirements of permits governing the use of the facility and Borrower’s application to the City requesting financial assistance, whichever occurs first. (b) Deferral. Provided that Borrower complies with the terms of the Security Instrument (defined below), the amounts due and payable under this Note shall be deferred and payable as follows: Upon Borrower’s sale of the Property, Borrower will pay to the City any and all of the principal amount of the Loan. The principal amount of the Loan shall be payable from the amount received by the Borrower as the sales price of property less a) the Borrower’s payment of the First Deed of Trust Loan and any accrued interest paid, (b) Borrower’s reasonable and customary costs of sale of the Property (including any broker’s commission). Upon payment of the principal amount of the Loan, any remaining proceeds received by Borrower as a result of the sale of the Property shall be used for the sole purpose of supporting programs and/or services to benefit City of Carlsbad residents. 7. Borrower’s Right To Repay. Borrower has the right to prepay the principal amount of this Note without any prepayment charge. 8. No Assumptions Of Note. Borrower acknowledges that this Note is given in connection with the purchase of property as part of a program of the City to assist with the provision of shelter and/or supportive services for the homeless. Consequently, this Note is not assumable by transferees of the Property, but is due and payable in full upon expiration of the term of this Note, on the date the Property is sold, or transferred or failure of Borrower to operate a homeless shelter and/or supportive services on the Property consistent with the requirements of permits governing the use of the facility and Borrower’s application to the City requesting financial assistance, whichever occurs first. 9. Maintenance; Taxes; Insurance. Borrower shall maintain the Property in good, clean and orderly condition. Borrower shall promptly pay all property taxes due on the Property prior to any delinquency and shall comply with the insurance requirements set forth in the Deed of Trust. 10. Default. (a) Borrower shall be in default under this Note if, after the notice and cure period provided by the City to Borrower pursuant to the notice and cure provisions of the Deed of Trust, Borrower (i) fails to pay any money when due under this Note; (ii) breaches any representation or covenant made in this Note in any material respect; or (iii) breaches any provision of the Deed of Trust. -2- . lb) Upon Borrower’s breach of any covenant or agreement of Borrower in this Note or Deed of Trust, including, but not limited to, the covenants to pay, when due, any sums secured by the Deed of Trust, the City prior to acceleration, will send, in the manner set forth in Section 15, notice to Borrower specifying: (I) the breach; (2) if the breach is curable; (3) a date, not less than 30 days from the date the notice is given to Borrower, by which the breach must be cured; and (4) if the breach is curable, failure to cure the breach on or before the date specified in the notice may result in acceleration of the sums secured by this Security Instrument and sale of the Property. The notice shall further inform Borrower of Borrower’s right to reinstate after acceleration and the right to bring a court action to assert the nonexistence of default or any other defense of Borrower to acceleration and sale, 11. Acceleration. Upon the occurrence of default under this Note or the Deed of Trust, the City shall have the right to declare the full amount of the principal under this Note immediately due and payable. Any failure by the City to pursue its legal and equitable remedies upon default shall not constitute a waiver of the City’s right to declare a default and exercise all of its rights under this Note and the Deed of Trust. Nor shall acceptance by the City of any payment provided for in the Note constitute a waiver of the City’s right to require prompt payment of any remaining principal owed. 12. No Offset. Borrower hereby waives any rights of offset it now has or may later have against the City, its successors and assigns, and agrees to make the payments called for in this Note in accordance with the terms of this Note. 13. Waivers. Borrower and any endorsers or guarantors of this Note, for themselves, their heirs, legal representatives, successors and assigns, respectively, severally waive diligence, presentment, protest, and demand, and notice of protest, dishonor and non-payment of this Note, and expressly waive any rights to be released by reasons of any extension of time or change in terms of payment, or change, alteration or release of any security given for the payments hereof, and expressly waive the right to plead any and all statutes of limitations as a defense to any demand on this Note or agreement to pay the same, and jointly and severally agree to pay all costs of collection when incurred, including reasonable attorney fees. If an action is instituted on this Note, the Borrower promises to pay, in addition to the costs and disbursements allowed by law, such sum as a court may adjudge reasonable as attorneys’ fees in such action. 14. No Waiver by the City. No waiver of any breach, default or failure of condition under the terms of this Note shall be implied from any failure of the City to take action with respect to such breach, default or failure or from any previous waiver of any similar or unrelated breach, default or failure. 15. Giving Of Notices. Except for any notice required under applicable law to be given in another manner, any notice to Borrower provided for in this Note shall be sent certified mail, return receipt requested or express delivery service with a delivery receipt, or personally delivered with a delivery receipt obtained, and shall be deemed to be effective as of the date shown of the delivery receipt as the date of delivery, the date delivery was refused, or the date the notice was returned as undeliverable. -3- . . Notices shall be directed as follows: Borrower: Catholic Charities, A Community Ministry of the Diocese of San Diego 349 Cedar Street San Diego CA 92101 Attn: Executive Director Citv of Carlsbad: Housing and Redevelopment Department 2965 Roosevelt Street Suite B Carlsbad CA 92008-2389 Attn: Housing and Redevelopment Director The parties may subsequently change addresses by providing written notice of the change in address to the other parties in accordance with this Section. 16. Joint and Several Obligations. This Note is the joint and several obligation of all makers, sureties, guarantors and endorsers, and shall be binding upon them and their successors and assigns. 17. Controlling Law. This Note shall be construed in accordance with and be governed by the laws of the State of California. 18. Assignment by the City. The City may assign its right to receive the proceeds under this Note to any person and upon notice to Borrower by the City all payments shall be made to the assignee. 19. Invalid Provisions. If any one or more of the provisions contained in this Note shall for any reason be held to be invalid, illegal or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remaining provisions contained in this Note, and this Note shall be construed as if such invalid, illegal or unenforceable provision had never been contained in this Note. 20. Entire Agreement. This Note (along with the Deed of Trust) sets forth the entire understanding and agreement of the City and Borrower and any amendment, alteration or interpretation of this Note must be in writing signed by both the City and Borrower. -4- : IN WITNESS WHEREOF the parties hereto have caused this Promissory Note to be executed as of the day and year first written above. Catholic Charities, A Community Ministry of the Diocese of San Diego, a California nonprofit corporation, SISTER RAYMONDA DUVALL, President REVEREND MON R DANIEL DILLA GH, Secretary/Treasurer -5- From: Leilani Hines To: Karen Kundtz Date: 1 l/18/97 5:30PM Subject: Re: Promissory Note for La Posada I was told by the City Attorney’s Office it didn’t need to be recorded. Please file the original Note in your office. z++ Karen Kundtz 1 l/l 8197 11:24AM x+ Leilani, I located the original Promissory Note in our office, (received yesterday). It does not appear to be set up for recordation, but I just wanted to double check. Do we need to do anything other than file the origininal Note in our office? Please let me know. Thanks. Karen. NOTE TO FILE: 11/20/97 Attached are the original recorded Deed of Trust and Security Agreement and the Loan Agreement and Related Restrictive Covenants between Catholic Charities and the City of Carlsbad. Also attached is original Promissory Note signed by Catholic Charities, which is not recorded (per instructions above). Documents were revised to reflect the correct legal name for Catholic Charities (see attached note from Leilani. Karen From: To: Date: Subject: Leilani Hines Lee Rautenkranz 9129197 11:24AM Phone & La Posada I was out all week on jury duty. My phone was not picked up for repairs/replacement. I’m still having the same old problems. La Posada On September 17th I sent to your office the original of the Promissory Note for the $200,000 loan to Catholic Charities authorized by Council. On Monday, September 22nd, the Title Company called to inform me that the name we had been using for Catholic Charities was not their legal name. For purposes of recording the loan agreement and deed of trust, the documents would have to be revised to reflect the correct legal name. We went ahead and made the revisions to the name on the appropriate pages with the exception of the signature page. I sent you the two pages that would were corrected. With regards to the signature page, the Tie Company was going to go ahead and note on the original signature page of the Loan Agreement and Deed of Trust the correct name so that it would not hold up the process by having to get everyone’s signature again. Does the Promissory Note also need the correct legal name of Catholic Charities or is the DBA name okay? If we need to use the correct legal name, can the original signature page of the Promisorry Note simply note the correction so that we do not need to obtain new signatures? (Crossing out the incorrect name and typing in the new name) Please advise.