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HomeMy WebLinkAbout2009 CON CDC Creative Kitchen Specialty Foods / San Diego Pretzel Co - Economic Development LoanECONOMIC DEVELOPMENT LOAN AGREEMENT THIS ECONOMIC DEVELOPMENT LOAN AGREEMENT [AGREEMENT], is made between The Community Development Commission (CDC) [OWNER] of the City Of National City, a Redevelopment Agency, and Creative Kitchen Specialty Foods, Inc. dba San Die2o Pretzel Company, [BUSINESS OWNER], located at 224 West 12th Street, National City, CA, 91950, on June 5, 2009, to participate in the Economic Development Loan Program. RECITALS 1. The CDC desires to stimulate private investment in the City's Commercial Districts. 2. The CDC believes that investment on improvements visible to customers, neighboring merchants, and residents will beautify the commercial corridors and increase the volume of business by making the districts and individual businesses more attractive and profitable. 3. The CDC has adopted and established an Economic Development Loan Program [EDLP] to assist business owners to improve their businesses located in the Redevelopment Project Area of the City of National City. The EDLP provides financial incentives to enhance the economic viability of businesses, promote commercial business opportunities, encourage investments by property owners and commercial tenants, and grow the business's taxable sales resulting in economic stimulus to the City of National City. 4. BUSINESS OWNER seeks to participate in the EDLP to install new equipment that will grow business operations. 5. The CDC has determined that the business subject to this AGREEMENT is located in the Redevelopment Project Area, has completed the SDSU Technical Assistance Program and is eligible to participate in the Program. 6. The CDC has entered into an agreement with the National City Chamber of Commerce to administer the EDLP. The National City Chamber of Commerce, as an agent of the CDC, will administer and manage the program on behalf of the CDC. The National City Chamber of Commerce will act as the designated representative in this Agreement. 7. As a condition of receiving the funds, BUSINESS OWNER(s) shall execute, among other things, this AGREEMENT, a promissory note, and a Deed of Trust, which Deed of Trust shall be recorded against the Business Property. These instruments are intended to secure CDC'S continuing interest in the condition of the Business, as well as the secure performance of other covenants contained in these AGREEMENTs. NOW, THEREFORE, in consideration of the recitals and the mutual obligations of the parties as herein expressed, the CDC and the BUSINESS OWNER(s) agree as follows: AGREEMENT Page 1 of 9 I. DEFINITIONS The following terms shall have the following meanings whenever used in this AGREEMENT, except where the context clearlyindicates otherwise. Any ambiguity as to the intended meaning or scope of the terms set forth below will be resolved solely by the CDC through its designated representative. Completion Date is defined as the date that the contractor has finished the business improvements per the AGREEMENT and Scope of Work and to the satisfaction of the CDC, as evidenced by final inspection and sign off by the CDC or its agent administering this program. Parcel is defined as the unit of real property as identified within the County Recorder's documents. Program Manager is defined as the designated representative for the CDC's Economic Development Loan Program. Project, also known as Economic Development Loan Project, is defined as the total business improvements made to the business/ property outlined in the Scope of Work, attached as Exhibit "A", and approved by the Program Manager. Total Cost Expenditure is defined as the total actual costs incurred by and paid for completing the project. Contractor is defined as a contractor selected through the bidding process to complete the business improvements per this AGREEMENT. Participant is defined as the Property and/or BUSINESS OWNER of the property to which the business improvements are made. BUSINESS OWNER(s) is defined as the person(s) on Title on the business's articles of incorporation. Owner is defined as the Community Development Commission (CDC). CDC is defined as the Community Development Commission of National City, and its authorized representatives, officers, officials, directors, employees and agents. AGREEMENT is defined as this AGREEMENT entered into between the CDC and BUSINESS OWNER(s). Note (the NOTE) is defined as the certain promissory note in the total principal amount of Fifteen Thousand Dollars ($15 000) to be executed by Business Owner(s) in favor of the CDC, evidencing all or any part of the funds, which is secured by the Deed of Trust, as well as any amendments thereto, modifications thereof or restatements thereof. The terms of the NOTE are hereby incorporated into this AGREEMENT by this reference. Page 2 of 9 Business Property is defined as the pledged collateral by the BUSINESS OWNER(s) to the CDC as security for debt repayment. Deed of Trust is the deed of trust, assignment of rents, and Deed of Trust placed on the Business Property as security for the assistance by Business Owner(s) as trustor with the CDC as beneficiary, as well as any amendments to, modifications of, and restatements of said deed of trust. The terms of the Deed of Trust are hereby incorporated into this AGREEMENT by this reference. II. PROPERTY/ BUSINESS OWNER(S) RESPONSIBILITIES 1. The Property Owner shall sign the EDL Program Application and submit to the Program Manager by June 5, 2009. 2. The BUSINESS OWNER(s) shall meet with the Program Manager to discuss the business improvement work to be completed, per this AGREEMENT by June 5. 2009. 3. The BUSINESS OWNER(s) shall sign this AGREEMENT and agrees to the Scope of Work attached as Exhibit "A" and by this reference made part of this AGREEMENT. The Scope of Work outlines the Economic Development Loan Project and itemizes approved costs based on the lowest bids, attached as Exhibit «B» The BUSINESS OWNER(s) shall be responsible for hiring the contractor from the bid process to complete the improvement work. 5. BUSINESS OWNER(s) agrees to maintain the business improvements made pursuant to this AGREEMENT in good condition, and to repair or replace any damage that occurs to the improvements, for a period of five (5) years following the completion date of the improvements. 6. BUSINESS OWNER(s) shall maintain an inviting, clean, and attractive business environment, satisfactory to and in the sole determination of the CDC. 7. BUSINESS OWNER(s) shall report annual statistics on property/ business investment, sales tax, and job creation to the CDC of National City. See attached Exhibit "C" for a report on 2006-2007 Data. 8. BUSINESS OWNER(s) shall, whenever possible, hire local contractors to perform business improvement work and hire local employees. 9. The BUSINESS OWNER(s) shall keep in full force and effect, during any and all work performed pursuant to this AGREEMENT, Comprehensive General Liability insurance in the amount not less than $1,000,000. BUSINESS OWNER(s) shall provide proof of insurance concurrent with execution of this AGREEMENT. Page 3 of 9 III. CDC'S RESPONSIBILITIES 1. The Program Manager shall meet with the BUSINESS OWNER(s) to discuss scope of work for the business improvements. 2. The CDC shall reimburse the BUSINESS OWNER for improvement work undertaken pursuant to this AGREEMENT, pursuant to a reimbursement process. a. Loan funds will be distributed on a reimbursement basis for qualifying and eligible expenses per this AGREEMENT. BUSINESS OWNER(S) must submit all required reimbursement forms, supplemental and supportive materials to the satisfaction of the CDC. b. The Program Manager will review the receipts submitted, and other supporting documents and conduct a walk through of the business to make sure that all work was completed in accordance with the Scope of Work in Exhibit "A" c. If all obligations under this AGREEMENT have been met to the satisfaction of the CDC, CDC will issue full reimbursement payment within forty-five days of final review and approval of the reimbursement request. IV. LOAN TO BUSINESS OWNER(S) l . The CDC agrees to Loan the BUSINESS OWNER Fifteen Thousand Dollars (S15,000) for the purpose of improving the business at 224 West 12th Street, National City, CA, 91950, consistent with the terms of this AGREEMENT. The Loan is secured by a NOTE and Deed of Trust, and is subject to repayment to the CDC if the BUSINESS is sold, leased, conveyed, refinanced, vacated, transferred, assigned, alienated, or hypothecated within five (5) years from the Completion Date of the improvements. 2. The NOTE is incorporated herein by reference. 3. The Note shall be secured by a Deed of Trust, which is incorporated herein by reference, and recorded against the pledged BUSINESS PROPERTY. V. CONDITIONS OF LOAN / LIEN 1. BUSINESS OWNER(S) AND CDC agree that if the improvements detailed in the Scope of Work, attached as Exhibit "A", on the BUSINESS commonly known as San Diego Pretzel Company located at 224 West 12'h Street, National City, CA, 91950, are maintained for at least five (5) years from the Completion Date of the improvements, the Loan will be forgiven and BUSINESS OWNER(S) shall not be required to repay the loan to the CDC. However, should the BUSINESS be sold, hypothecated, vacated, leased, transferred, assigned, or alienated on or Page 4 of 9 before five (5) years from the Completion Date of the improvements, this Loan shall be repayable in full by the BUSINESS OWNER(S) to CDC, upon demand, with interest at the option of the CDC. 2. Interest shall be calculated at 8.5 % per annum simple interest retroactive to the date of the Loan. Unless BUSINESS OWNER(S) has complied with the terms of the AGREEMENT, the Loan identified shall constitute a lien upon the Business in the amount of the loan plus interest computed. 3. BUSINESS OWNER(S) has pledged real property located at 5054 Seachase Drive, San Diego, CA 92130, APN No. 304-500-14-00, as loan collateral. attached as Exhibit "C". VI. DEFAULT A failure to use the funds received for work agreed upon in this AGREEMENT, or any violation of any of the terms of this AGREEMENT, shall constitute a breach of the AGREEMENT. CDC staff shall send a letter to the borrower in the case of default on the loan account or a breach of contract and shall r equire the deficiency, default, or breach be cured within 30 days. If the breach, default, or deficiency is not cured in this time frame, then the City Attomey's Office may, at its discretion, initiate formal legal proceedings. The borrower will be subject to all remedies available by law. VII. DELINQUENCY In the event of default in Section VI or failure to fulfill the conditions of the loan stated in Section V, and BUSINESS OWNER fails to repay the loan within 30 days from demand, the loan provider shall commence collection ofthe delinquent account using CDC staff and/or City Attorney staff as deemed appropriate. VIII. RECORDATION OF AGREEMENT The BUSINESS OWNER(S) and the CDC agree that this AGREEMENT shall be recorded in the Office of the County Recorder and shall constitute constructive notice to the public that upon sale, hypothecation, assignment, lease, transfer or alienation of the BUSINESS within five (5) years from the Completion Date of the Improvements, the Loan shall be repayable with interest. After five (5) years from the Completion Date of the improvements, the Loan shall have no further force and effect upon the BUSINESS OWNER(s) and the CDC shall execute and record a full reconveyance of the Loan any and all documents necessary to clear title to the BUSINESS OWNER(S) upon the request of the BUSINESS OWNER(S). IX. TIME OF PERFORMANCE The contractor/ BUSINESS OWNER(s) shall complete the business improvements within 6 MONTHS of the date of this AGREEMENT. The contractor shall submit final bills and receipts to the Community Development Department no later than 15 days after the Completion Date. Page 5 of 9 X. PROJECT FUNDING The CDC has determined that this Project qualifies for Redevelopment Funds. The CDC agrees, as detailed in this Agreement, to loan BUSINESS OWNER the Total Cost Expenditure not to exceed $15,000. XI. NO AGENCY CREATED Any Contractor, person, or otherwise hired by the BUSINESS OWNER(s) to complete business improvements are not agents of the CDC, nor is there any contractual relationship established between Contractor, person, or otherwise and the CDC. Any provisions of this AGREEMENT that may appear to give the CDC any right to direct the BUSINESS OWNER(s) concerning the details of the obligations under this AGREEMENT, or to exercise any control over such obligations, shall mean only that the BUSINESS OWNER(s) shall follow the direction of the CDC concerning the end results of the obligations, consistent with the scope of work. XII. OWNERSHIP OF DOCUMENTS Once the BUSINESS OWNER(s) has received the Final Payment for the business improvements, all documents, including but not limited to, designs, plans, bids, bills, and receipts, prepared or acquired by the BUSINESS OWNER(s) pursuant to this AGREEMENT (including any duplicate copies) shall be the property of the CDC. The CDC's ownership entitlement arises upon payment or any partial payment of the project. The CDC's ownership of these documents includes use of, reproduction or reuse of, and all incidental rights. XIII. HOLD HARMLESS The BUSINESS OWNER(s) agrees to defend, indemnify, protect, and hold the CDC and its agents, officers, and employees harmless from and against any and all claims asserted or liability established for damages or injuries to any person or property. This indemnification and hold harmless agreement includes claims made by the BUSINESS OWNER's employees, agents, or officers, or judgments arising directly or indirectly out of obligations or services under this AGREEMENT. Claims that arise from, are connected with, or are caused or claimed to be caused by the acts or omissions of the BUSINESS OWNER(s), and its agents, officers, or employees are covered. Also covered are the claims or liabilities arising from, connected with, caused by, or claimed to be caused by the active or passive negligent acts or omissions of the CDC, its agents, officers, or employees which may be in combination with the negligence of the BUSINESS OWNER(s), its employees, agents or officers, or any third party. The BUSINESS OWNER's duty to defend, indemnify, protect and hold harmless shall not include any claims or liabilities arising from the established sole negligence or sole willful misconduct of the CDC, its agents, officers or employees. Page 6 of 9 XIV. DUTY TO DEFEND The BUSINESS OWNER(s) further agree that the hold harmless agreement in Section Xl, and the duty to defend the CDC, require the BUSINESS OWNER(s) to pay any costs the CDC incurs that are associated with enforcing the hold harmless provisions, and defending any claims arising from obligations or services under this AGREEMENT. If the CDC chooses at its own election to conduct its own defense, participate in its own defense, or obtain independent legal counsel in defense of any claim related to obligations or services under this AGREEMENT, the BUSINESS OWNER(s) agrees to pay the reasonable value of attorneys' fees and all of the CDC's costs. XV. COMPLIANCE WITH APPLICABLE LAWS The BUSINESS OWNER(s) agrees to comply fully with all applicable Federal, State, and local laws, ordinances, codes, regulations, permits, and design guidelines. The CDC will not issue any payment to the BUSINESS OWNER(s) if the subject property is in violation of any law, ordinance, code, regulation, permit, or design guideline. The BUSINESS OWNER(s) assumes responsibility for any costs arising from repairs or alterations caused by any violation of any law, ordinance, code, regulation, permit, or design guideline. XVI. WAGE RATES Tax increment funds are used for the EDL Program. Whenever federal and/or local funds are used, either in whole or in part, federal Davis -Bacon and/or state prevailing wages must be paid for all onsite labor relating to the project. Any improvements made to the business or property in addition to the EDL project must be completed prior to starting, or at the completion of the EDL project and is at the expense of the business/property owner. If the work is done simultaneously, then prevailing wage must be paid on the entire project, including interior renovations. For more information, log onto: www.wdol.gov (Davis Bacon website) and/or www.dir.ca.gov/DLSR/statistics_research.html (California Department of Industrial Relations, Division of Labor and Statistics, information on prevailing wage). XVII. NON -ASSIGNMENT The BUSINESS OWNER shall not assign the obligations under this AGREEMENT, nor any monies due or to become due, without the CDC's prior written approval. Any assignment in violation of this paragraph is grounds for immediate termination of this AGREEMENT, at the solc discretion of the CDC. In no event shall any putative assignment create a contractual relationship between the CDC and any putative assignee. Page 7 of 9 XVIII. NO WAIVER Any failure by the CDC to insist upon the strict performance by the other of any covenant, term, or condition of this AGREEMENT, or any failure to exercise any right or remedy consequent upon a breach of any covenant, term, or condition of this AGREEMENT, shall not constitute a waiver of any breach or of such covenant, term or condition. No waiver of any breach shall affect or alter this AGREEMENT, and each and every covenant, condition, and term hereof shall continue in full force and effect to any existing or subsequent breach. XIX. ORAL REPRESENTATIONS This AGREEMENT and the exhibits and references incorporated into this AGREEMENT fully express all understandings of the parties concerning the matters covered in this AGREEMENT. No change, alteration, or modification of the terms of this AGREEMENT, and no verbal understanding of the parties, their officers, agents, or employees shall be valid unless made in the form of a written change agreed to in writing by both parties or an amendment to this AGREEMENT agreed to by both Parties in writing. All prior negotiations and AGREEMENTs are merged into this AGREEMENT. XX. CHANGES OR AMENDMENTS TO AGREEMENT All amendments to this AGREEMENT shall be in writing signed by the BUSINESS OWNER(s), Property Owner and the CDC. This AGREEMENT is executed by The Community Development Commission (CDC) of the City of National City acting by and through its Commissioners, and by the BUSINESS OWNER(s). Dated this 11rdday of JUAl , 2009. COMMUNITY DEVELOPMENT COMMIS Dated this J day o By Brad R ve Director , 2009. Creative Kitchen Specialty Foo , Inc. dba S ji Diego Pretze pan Harris Golden, Vice President Page 8 of 9 Approved as to form. GEO(iE EIS , City Attorney By Dated: di ilva Senior sistant City Attorney EXHIBITS: A — Scope of Work B — Project Bids C —Report to CDC State of California County of San Diego 1�Q h0 DJ nc� i4 e `c 0 r>�Q �� ��6�q before me, � N, e undersigned, a Notary Public in and for the County of San Diego, State of California , personally appeared Brad Raulston who proved to me on the basis of satisfactory evidence to be the person whose name' )(/are - subscribed to the within Economic Development Loan Agreement and acknowledged to me thalashezthey executed the same in OflierAlleir authorized capacity, and that by hi heir signature(4on the instrument the person or the entity upon behalf of which the person 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. Si; ature of Notary Public Page 9 of 9 PROMISSORY NOTE SECURED BY DEED OF TRUST San Diego, California June 5, 2009 1. For value received, the undersigned, Creative Kitchen Specialty Foods, Inc. ("Borrower"), promises to pay to the order of the Community Development Commission of the City of National City ("Lender" or "CDC"), in accordance with the provisions of this Promissory Note ("Note"), on or before the Loan Maturity Date (defined below), the initial sums of Fifteen Thousand Dollars and no/100 Dollars ($15,000) (the "Loan Amount"). 2. The "Effective Date" of this Note is June 5, 2009, the date of the initial advance of funds. 3. All capitalized terms used in this Note, unless otherwise defined, will have the respective meanings specified in the Economic Development Loan Agreement or the Deed of Trust entered into between the Borrower and Lender on June 5, 2009, which meanings are incorporated herein by this reference as though fully set forth. 4. If any provision of this Note conflicts with or is inconsistent with the provisions of the Economic Development Loan Agreement or the Deed of Trust (all collectively, the "Economic Development Loan Agreements"), the Economic Development Loan Agreements shall supersede. 5. The Loan Amount will bear interest at the rate of 8.5% per annum simple interest retroactive to May 19, 2009, the date of the Loan. 6. The Loan Amount will be due on the Loan Maturity Date (as defined below). 7. "Loan Maturity Date" means the date on which the indebtedness evidenced by this Note is due pursuant to the terms of any of the Economic Development Loan Agreements, which includes, but is not limited to, immediate repayment if the Business is sold, leased, conveyed, refinanced, vacated, transferred, assigned, alienated, or hypothecated within five (5) years from the Completion Date of the improvements as defined by and at the option of the CDC. 8. All payments will be applied first to accrued interest then to the principal. 9. The Loan Amount is payable in lawful money of the United States of America, in same day funds at any place that Lender or the legal holders of this Note may, from time to time, in writing designate, and in the absence of that designation, then by cashiers check delivered to the attention of the Finance Department at CDC's office located at 1243 National City Boulevard, National City, California 91950. 10. The principal amount of the indebtedness evidenced by this Note may, at the option of the Borrower, be prepaid in whole or in part without penalty or premium. 11. Time is of the essence. A failure by Borrower to fully repay the Loan on or before the Loan Maturity Date will constitute an Event of Default under this Note and entitle 1 Promissory Note. Lender to exercise any and all of its contractual, legal or equitable remedies including but not limited to those set forth in the Economic Development Loan Agreements. 12. On the occurrence of an Event of Default under this Note, or on the occurrence of any Event of Default under any of the Economic Development Loan Agreements, or on the occurrence of any other event that, under the terms of any of the Economic Development Loan Agreements, gives rise to Lender's right to accelerate the repayment of the outstanding Loan Amount, then, at the sole option of Lender, the full outstanding amount of this Note, or any part thereof specifically designated by the Lender in writing, shall immediately become due and payable by Borrower to Lender, without any further presentment, demand, protest, or notice of any kind. Borrower agrees that this Note will be deemed to have been made under, and will be governed by, the laws of the state of California in all respects, including matters of construction, validity, and performance, and that none of its terms or provisions may be waived, altered, modified, or amended except as Lender may consent to in a writing duly signed by Lender or its authorized agents. 13. This Note is to become secured, among other security, by a Deed of Trust covering that real property located at 5054 Seachase Drive, San Diego, CA 92130 and identified as APN No. 304-500-14-00, as loan collateral located in San Diego, California, and any improvements, fixtures, or personalty located thereon, together with: (i) all rights, privileges, tenements, hereditaments, rights -of -way, easements, and appurtenances of the land, the improvements, fixtures or personalty located on the land, and all rights, title, and interest of Borrower in any streets, ways, alleys, strips, or gores of land adjoining such property; and (ii) all of Borrower's right, title, and interest in and to said property, including any rights or entitlements affecting the land, the improvements, fixtures, or personalty, including, without limitation, the Deed of Trust, which is incorporated herein by this reference as though fully set forth herein, to be executed by the undersigned, as trustor, in favor of Stuart Title, as trustee, for the benefit of Lender, as beneficiary, in accordance with the terms of the Economic Development Loan Agreements. This Note is the Note referred to in the Economic Development Loan Agreements, as well as the Deed of Trust, and is entitled to the benefits of the Economic Development Loan Agreements, that contain among other things, provisions for acceleration of the maturity of this Note on the happening of certain stated events. 14. The Deed of Trust provides as follows: "Should the BUSINESS be sold, hypothecated, vacated, leased, transferred, assigned, or alienated on or before five (5) years from the Completion Date of the improvements, this Loan shall be repayable in full by the BUSINESS OWNER(S) to CDC, upon demand, with interest at the option of the CDC, (each, a `Transfer'), without first obtaining the written consent of the Beneficiary, then all obligations secured by the Deed of Trust may be declared due and payable, at the option of the Beneficiary, as stated in Section V of the Economic Development Loan Agreement (as defined in the Note). Consent to one transaction of this type will not constitute a waiver of the right to acquire consent to future or successive transactions." 2 Promissory' Note. 15. Borrower agrees that, if Lender or holder of this Note incurs: (i) any costs, fees, or expenses, including costs of procuring evidence of title incurred in connection with sale; or (ii) any costs including, without limitation, attorney fees, incurred in enforcing payment, whether or not suit is filed, or protecting security, including, without limitation, all costs, attorney fees, and expenses incurred in connection with any bankruptcy, reorganization, arrangement, or other similar proceedings involving the undersigned or the Property, that in any way affects the exercise of rights and remedies under this Note or the Economic Development Loan Agreements, then Borrower will repay such expenses upon receipt of written demand from Lender, and, if such expenses are not immediately repaid, such outstanding amount will increase the currently outstanding indebtedness under this Note, and be secured by the Deed of Trust All costs and expenses incurred by Lender or holder of this Note to obtain relief from the stay of bankruptcy statutes are specifically included in the expenses referred to in this Paragraph. 16. Regardless of any of the provisions of this Note, nothing in this Paragraph will be deemed to limit or prejudice the rights of Lender to: (a) enforce the Deed of Trust or enforce any of its other rights or remedies under the Economic Development Loan Agreements; or (b) proceed against any entity or person, including Borrower with respect to the enforcement of any leases, bonds, policies of insurance, or other agreements; or (c) recover damages against Borrower for fraud, breach of warranty, failure to maintain insurance, waste, or material misrepresentation; or (d) recover any condemnation proceeds or insurance proceeds or other similar funds or payments attributable to the Property that, under the terms of the Economic Development Loan Agreements should have been paid to Lender; or (e) recover any tenant security deposits, prepaid rents, or other similar sums paid to or held by Borrower or any other entity or person in connection with the Business; or (1) recover the rents and profits of the Business accruing from and after the occurrence of an Event of Default that have not been applied to pay any portion of the outstanding indebtedness of this Note, operating, and maintenance expenses of the Business, insurance, premiums, impositions, deposits into a reserve for replacement, or other sums required by the Loan Document; or (g) recover damages including, without limitation, recovery of all amounts authorized under any environmental indemnity agreement between Lender and Borrower, relating to breach of any covenant, representation, or warranty of Borrower in the Economic Development Loan Agreements; or (h) recover from Borrower the entire outstanding indebtedness of this Note, if the exercise of any right or remedy under federal, state, or local forfeiture laws results in the loss of the lien of any Deed of Trust, or the priority of such, against the respective Business; or (i) recover funds to reimburse Lender for sums expended by Lender for the protection or preservation of the Property or Lender's interest in it (including, without limitation, payment of any real property taxes or assessments). Any liability of Borrower for any obligations arising in connection with the matters set forth in the above clauses, (a) through (i) inclusive, will be personal liability, and may be asserted against and recovered from its or their interest in the Business, as well as, against any of Borrower's other assets. Any liability of Borrower arising in connection with matters set forth in clause (g) will not be limited to the outstanding principal amount of this Note, and Borrower's obligations will survive foreclosure, deed in lieu of foreclosure, release, partial release, reconveyance, partial reconveyance, or any other transfer of the Property. 17. The Deed of Trust will be reconveyed upon Lender's satisfaction that all obligations secured by the Deed of Trust have been performed in full. 3 Promissory Note. In witness whereof, the undersigned has caused this Promissory Note to be executed as of the date and year first above written. Borrower: Creative Kitchen Specia ty Food, Inc. B' iderr,liresident Harris Golden, Vice President State of Californ' , ) County ofZ,p aQ(Q ) OrrJ), i �, &QQ9 before me,MOQi s7 )(personally sae, appeared }�pyris(jpj,, i'�`- . proved to me on the basis of satisfActory evidence to be the pers. $ whose name '41t2 subscribed to the within instrument and acknowledged to me that executed the same i /t ei authorized capacit., , and that by on the instrument the perso rs)t or the entity upon beha f of which the perso 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. nature of Notary Public 4 Promissory Note. NO CHARGE ON THIS DOCUMENT FOR THE BENEFIT OF A STATE AGENCY FORMED BY THE CITY OF NATIONAL CITY Recording Requested By: Community Development Commission of the City of National City 1243 National City Boulevard National City, CA 91950-4301 And When Recorded Mail To: Office of the City Clerk City of National City 1243 National City Blvd. National City, CA 91950 OC # 2009-0420270 II 11111111111111111111111111111111110111111111111111 JUL 28, 2009 4:18 PM OFFICIAL RECORDS SkN DIEGO CCLINTY RECORDER'S OFFICE D,AVID L. BUTLER. COUNTY RECORDER FEES: 0,00 DA 1 PAGES: 10 11101111111111IIIII111111101NIII11111IIIIIIIIII11111IIIII1111111111illl�11I DEED OF TRUST THIS DEED OF TRUST is made this 18th day of May, 2009, by Creative Kitchen Specialty Foods, Inc., whose address is 224 West 12th Street, National City, CA 91950 ("Trustor"), to Stuart Title Company, a California corporation ("Trustee"); for the benefit of the Community Development Commission of the City of National City ("Beneficiary"), whose address is 1243 National City Boulevard, National City, California 91950-4301. TRUSTOR HEREBY irrevocably grants, transfers, and assigns to Trustee, in trust, with power of sale, all that property, including, but not limited to, real property located at 5054 Seachase Drive, San Diego, Ca, 92130, APN No. 304-500-14-00, as loan collateral, in the City of San Diego, County of San Diego, State of California, described as: Lot 76 of Carmel Valley neighborhood 4, unit 7 in the city of San Diego, County of San Diego, state of California according to map thereof number 13341. Filed in the office of the County Recorder of San Diego County July 30, 1996. FOR THE PURPOSE OF SECURING: (1) Payment of the indebtedness evidenced by a promissory note of even date herewith executed by Trustor, in the principal sum of FIFTEEN THOUSAND NO/100 DOLLARS ($15,000.00), and any renewal, extension, or modification of the promissory note (the "Note); (2) Any additional sums and interest that may hereafter be loaned to the then record owner of the Business by Beneficiary, when evidenced by another note or notes reciting that it or they are so secured; and III Deed of Trust Creative Kitchens, Inc. (3) The performance of each agreement contained in this Deed of Trust. 135v A. TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR AGREES: Maintenance and Repair (1) To keep the Property/ Business in good condition and repair; not to remove or demolish any buildings on the Property; to complete or restore promptly and in good and workmanlike manner any building that may be constructed, damaged or destroyed on the Property/Business ; to pay when due all claims for labor performed and materials furnished for the Property/Business ; to comply with all laws affecting the Property/Business or requiring any alterations or improvements to be made on the Property/Business ; not to commit or permit waste of the Property/Business ; not to commit, suffer or permit any act upon the Property/Business in violation of law; and to cultivate and maintain the landscaping, and do all other acts that from the character or use of the Property/Business may be reasonably necessary. Fire Insurance (2) To provide, maintain, and deliver to Beneficiary fire insurance satisfactory to and with loss payable to Beneficiary as its interest may appear. The amount collected under any fire or other insurance policy may be applied by Beneficiary upon any indebtedness secured by this Deed of Trust, and in any order determined by Beneficiary, or at the option of Beneficiary, the entire amount so collected or any part of that amount may be released to Trustor, except that if the proceeds of the award for any taking or injury to the Property/ Business or the amount of such proceeds plus funds provided by Trustor is sufficient to allow for the repair and restoration of the Property/ Business, and such repair and/or restoration is physically and legally possible, then the Trustor shall use the proceeds of the award to timely effectuate such repair and/or restoration. Upon receipt of such proceeds, Beneficiary may hold the proceeds as further security, or apply or release them in the same manner and with the same effect as provided in this Deed of Trust for the disposition of proceeds of fire or other insurance. This application or release shall not cure or waive any default or notice of default under this Deed of Trust or invalidate any act done pursuant to such a notice. Defense of Security (3) To appear in and defend any action or proceeding purporting to affect the security of this Deed of Trust or the rights or powers of Beneficiary, or Trustee; and to pay all costs and expenses, including cost of evidence of title and attorneys' fees in a reasonable sum, in any such action or proceeding in which Beneficiary or Trustee may appear, and in any suit brought by Beneficiary to foreclose this Deed of Trust. Payment of Liens and Taxes (4) To pay, at least ten (10) days before delinquency, all taxes and assessments affecting the Business/Property, including assessments on appurtenant water stock, all encumbrances, charges, and liens, with interest, on the Property/ Business or any part of the Property/ Business, which appear to be prior or superior to this Deed of Trust; and all costs, fees, and expenses of this Trust. If Trustor fails to make any payment or to do any act as provided in this Deed of Trust, then 2 Deed of Trust - 2009 San Diego Pretzel Company. Beneficiary or Trustee may (but is not obligated to) make the payment or do the act in the required manner, and to the extent deemed necessary to Beneficiary or Trustee to protect the security of this Deed of Trust. The performance by Beneficiary or Trustee of such an act shall not require notice to or demand upon Trustor, and shall not release Trustor from any obligation under this Deed of Trust. Beneficiary or Trustee shall also have the following related rights and powers: to enter upon the Property/ Business for the foregoing purposes; to appear in and defend any action or proceeding purporting to affect the security of this Deed of Trust or the rights and powers of Beneficiary or Trustee; to pay, purchase, contest, or compromise any encumbrance, charge, or lien that in the judgment of either appears to be prior or superior to this Deed of Trust; to employ counsel; and to pay necessary expenses and costs, including attorneys' fees. Reimbursement of Costs (5) To pay immediately and without demand all sums expended by Beneficiary or Trustee pursuant to this Deed of Trust, with interest from date of expenditure at the amount allowed by law in effect at the date of this Deed of Trust, and to pay any reasonable amount demanded by Beneficiary (up to the maximum allowed by law at the time of the demand) for any beneficiary statement requested by Trustor or any other beneficiary of a Deed of Trust encumbering the Property/Business regarding the obligation secured by this Deed of Trust. Obligations of Trustor (6) That Trustor will not permit or suffer the use of any of the Property/ Business for any purpose other than the use for which the same was intended at the time this Deed of Trust was executed. (7) That the Economic Development Loan Agreement, dated June 5, 2009 and referred to in the Note is incorporated herein by reference and made a part of this Deed of Trust, and that those terms defined in the Economic Development Loan Agreement have the same meaning in this Deed of Trust. (8) To perform, in a timely manner, each agreement and covenant by and between Trustor on any and all notes, loans, and deeds of trust that are senior and/or junior to this Deed of Trust. A default in any of these obligations, beyond any applicable cure period, shall constitute a default under the Deed of Trust. B. TRUSTOR AGREES THAT: Condemnation Award (1) Any award of damages in connection with any taking or condemnation, or for injury to the Property/ Business by reason of public use, or for damages for private trespass or injury to the Property/Business , is hereby assigned and shall be paid to Beneficiary, as its interest may appear as further security for all obligations secured by this Deed of Trust, except that if the proceeds of the award for any taking or injury to the Property/Business or the amount of such proceeds plus funds provided by Trustor is sufficient to allow for the repair and restoration of the Property/Business , and such repair and/or restoration is physically and legally possible, then the Trustor shall use the proceeds of the award to timely effectuate such repair and/or restoration. Upon receipt of such proceeds, Beneficiary may hold the proceeds as further security, or apply or 3 Deed of Trust - 2009 San Diego Pretzel Company. release them in the same manner and with the same effect as provided in this Deed of Trust for the disposition of proceeds of fire or other insurance. Waiver of Late Payments (2) By accepting payment of any sum secured by this Deed of Trust after its due date, Beneficiary does not waive its right either to require prompt payment when due of all other sums so secured or to declare default for failure to pay any indebtedness secured by this Deed of Trust. Trustee's Powers (3) Upon written request of Beneficiary and presentation of this Deed of Trust, Trustee may (a) reconvey all or any part of the Property/Business ; (b) consent to the making and recording, or either, on any map or plat of all or any part of the Property/Business ; (c) join in granting any easement of the Property/Business ; or (d) join in or consent to any extension agreement or any agreement subordinating the lien, encumbrance, or charge of this Deed of Trust. Trustee need not provide Trustor with notice before taking any of the foregoing actions, and shall not be liable for the proper performance of the act. The exercise by Trustee of any of the foregoing powers shall not affect the personal liability of any person for payment of the indebtedness secured by this Deed of Trust, or the lien of this Deed of Trust on the remaining Property/Business as security for the repayment of the full amount secured by this Deed of Trust. Full Reconveyance (4) Upon written request of Beneficiary stating that all obligations secured by this Deed of Trust have been performed in full, surrender of this Deed of Trust, any notes secured by this Deed of Trust to the Trustee for cancellation and retention, and payment of Trustee's fees and charges, Trustee shall reconvey, without warranty, the Property/Business then subject to this Deed of Trust. Absent manifest error, the recitals in the Reconveyance shall be conclusive proof of the truthfulness of the recitals. The grantee in the Reconveyance may be described as "the person or persons legally entitled thereto." Five years after issuance of the full reconveyance, Trustee may destroy the Note and this Deed of Trust, unless directed in the request to retain them. Assignment of Rents (5) As additional security, Trustor hereby gives to and confers upon Beneficiary the right, power, and authority during the continuance of these Trusts, to collect the rents, issues, and profits of the Property/Business , but reserves the right, prior to any default by Trustor in payment of any indebtedness secured by this Deed of Trust or in the performance of any agreement under this Deed of Trust, to collect and retain these rents, issues, and profits as they become due and payable. Upon any such default for which cure has not been commenced within thirty (30) days and thereafter completed with diligence, Beneficiary may, without notice and without regard to the adequacy of the security for the indebtedness secured by this Deed of Trust, either personally or by agent or court -appointed receiver, do the following: enter upon and take possession of the Property/Business or any part of the Property/Business ; sue for or otherwise collect all rents, issues, and profits, including those past due and unpaid; and apply these rents, issues, and profits, less costs and expenses of operation and collection (including reasonable 4 Deed of Trust - 2009 San Diego Pretzel Company. zvo attorneys' fees), upon any indebtedness secured by this Deed of Trust, in any order determined by Beneficiary. The exercise of the foregoing rights by Beneficiary shall not cure or waive any default under this Deed of Trust or invalidate any act done pursuant to such a notice. Default in Foreclosure (6) Upon default by Trustor in the payment of any indebtedness secured by this Deed of Trust or in the performance of any obligation under this Deed of Trust for which cure has not been commenced within thirty (30) days, and thereafter completed with diligence, Beneficiary may declare all sums secured by this Deed of Trust immediately due and payable by delivering to Trustee a written declaration of default and demand for sale and a written notice of default and election to sell the Property/Business . Trustee shall cause the notice of default and election to sell to be recorded. Beneficiary also shall deposit with Trustee this Deed of Trust, a copy of the Agreement, and all other documents evidencing obligations secured by this Deed of Trust. After the required time period has lapsed following the recordation of the Notice of Default, and after notice of sale has been given as required by law, Trustee, without demand on Trustor, shall sell the Property/Business at the time and place specified in the notice of sale, either as a whole or in separate parcels, and in any order determined by Trustee, at public auction to the highest bidder for cash in lawful money of the United States, payable at the time of sale. Trustee may postpone sale of all or any portion of the Property/Business by public announcement at the time and place of sale, and from time to time thereafter may postpone the sale by public announcement at the time fixed by the preceding postponement. Trustee shall deliver to the purchaser at the auction its deed conveying the Property/Business old, but without any covenant or warranty, express or implied. Absent manifest error, the recital in the deed of any matter or fact shall be conclusive proof of the truthfulness of the recital. Any person, including Trustor, Trustee, or Beneficiary, may purchase at the sale. After deducting all costs, fees, and expenses of Trustee and Beneficiary under this paragraph, including costs of procuring evidence of title incurred in connection with sale, Trustee shall apply the proceeds of sale to payment of: all sums expended under the terms of this Deed of Trust, not then repaid, with accrued interest at the amount allowed by law in effect at the date of this Deed of Trust; all other sums then secured by this Deed of Trust; and the remainder, if any, to the person or persons legally entitled to the remaining proceeds. Further Encumbrances (7) Should Trustor's business, known as the San Diego Pretzel Company, be sold, hypothecated, vacated, leased, transferred, assigned, or alienated on or before five (5) years from the Completion Date of the improvements, this Loan shall be repayable in full to CDC, upon demand, with interest at the option of the CDC, then all obligations secured by the Deed of Trust may be declared due and payable, at the option of the Beneficiary, as stated in Section V of the Economic Development Loan Agreement (as defined in the Note). Consent to one transaction of this type will not constitute a waiver of the right to acquire consent to future or successive transactions. 5 Deed of Trust - 2009 San Diego Pretzel Company. Interest shall be calculated at 8.5 % per annum simple interest retroactive to the date of the Loan. Unless BUSINESS OWNER(S) has complied with the terms of the AGREEMENT, the Loan identified shall constitute a lien upon the Business in the amount of the loan plus interest computed. The Debtor will pay the note secured by this Deed of Trust and any renewal or extension of it and any other indebtedness secured by this Deed of Trust in accordance with the terms and provisions of this Deed of Trust. On full payment by the Debtor of all indebtedness secured by this agreement in accordance with this Deed of Trust, this Deed of Trust shall expire, and the Secured Party's security interest in the Collateral, as set forth in this Deed of Trust shall terminate. General Provisions (8) This Deed applies to, inures to the benefit of, and binds all parties to this Deed of Trust, and their heirs, legatees, devisees, administrators, executors, successors, and assigns. The term "Beneficiary" shall mean the Community Development Commission of the City of National City, and the heirs, legatees, devisees, administrators, executors, and assigns of any such person. In this Deed, whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular number includes the plural. Acceptance by Trustee (9) Trustee accepts this Trust when this Deed, duly executed and acknowledged, is made a public record as provided by law. Trustee is not obligated to notify any party to this Deed of Trust 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. Substitution of Trustees (10) Beneficiary, or any successor in ownership of any indebtedness secured by this Deed of Trust, may from time to time, by written instrument, substitute a successor or successors to any Trustee named in or acting under this Deed of Trust. The substitution instrument shall contain the name of the original Trustor, Trustee, and Beneficiary under this Deed of Trust, the book and pate where this Deed is recorded, and the name and address of the new Trustee. When executed by Beneficiary, and duly acknowledged and recorded in the office of the recorder of the county or counties where the Property/Business is situated, the substitution instrument shall be conclusive proof of proper substitution of the successor Trustee or Trustees. Any successor Trustee or Trustees shall, without conveyance from the Trustee predecessor, succeed to all its title, estate, rights, powers, and duties. Cumulate Powers and Remedies (11) The powers and remedies conferred in the Deed of Trust are concurrent and cumulative to all other rights and remedies provided in this Deed of Trust or given by law. These powers and remedies may be exercised singly, successively, or together, and as often as deemed necessary. 6 Deed of Trust - 2009 San Diego Pretzel Company. 13525 Conclusiveness of Recitals (12) The recitals contained in any reconveyance, trustee's deed, or any other instrument executed by the Trustee from time to time under the authority of this Deed of Trust or in exercise of its powers or the performance of its duties under this Deed of Trust, shall be conclusive evidence of their truth, whether stated as specific and particular facts, or in general statements or conclusions absent manifest error. Further, the recitals shall be binding and conclusive upon the Trustor, its heirs, executors, administrators, successors, and assigns, and all other persons. Attorneys' Fees (13) If any action is brought for the foreclosure of this Deed of Trust or for the enforcement of any provision of this Deed of Trust (whether or not suit is filed), Trustor agrees to pay all costs and expenses of Beneficiary and Trustee, including reasonable attorneys' fees; and these sums shall be secured by this Deed of Trust. Co -trustees (14) If two or more persons are designated as Trustee in this Deed of Trust, any, or all, power granted in this Deed of Trust to Trustee may be exercised by any of those persons, if the other person or persons are unable, for any reason, to act. Any recital of this inability in any instrument executed by any of those persons shall be conclusive against Trustor and Trustor's heirs and assigns. Request for Notices of Default and Sale (15) In accordance with Section 2924b of the California Civil Code, request is hereby made that a copy of any Notice of Default and a copy of any Notice of Sale under that Deed of Trust executed by the Trustor concerning this Property/Business be mailed to: Community Development Commission of the City of National City 1243 National City Boulevard National City, CA 91950-4301 NOTICE: A copy of any notice of default and of any notice of sale will be sent only to the address contained in this recorded request. If your address changes, a new request must be recorded. The undersigned Trustor requests that a copy of any notice of default and of any notice of sale under this Deed of Trust be mailed to Trustor at the address of Trustor set forth above. Reasonable Inspection (17) Trustor shall permit Beneficiary and its agents or representatives, to inspect the Property/Business at any and all reasonable times, with at least 24 hours advance notice. Inspections shall be conducted so as not to interfere with the tenants' use and enjoyment of the Property/Business . Hazardous Materials 7 Deed of Trust - 2009 San Diego Pretzel Company. 13526 (18) For purposes of this Deed of Trust, "Hazardous Materials" mean and include any hazardous, toxic or dangerous waste, substance or material including, without limitation, flammable explosives, radioactive materials, asbestos, hazardous wastes or toxic substances in (or for purposes of) the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), as amended (42 U.S.C. § 9601, et seq.), the Hazardous Materials Transportation Act (49 U.S.C. § 1801, et seq.), the Resource Conservation and Recovery Act (42 U.S.C. § 6901, et seq.), and those substances defined as hazardous wastes in § 25117 of the California Health and Safety Code or as hazardous substances in § 25316 of the California Health and Safety Code or in any regulations promulgated under either such law, any so-called "Superfund" or "Superlien" law, or any other federal, state, or local statute, law, ordinance, code, rule, regulation, order, or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect. (19) In addition to the general and specific representations, covenants, and warranties set forth in the Deed of Trust or otherwise, Trustor represents, covenants, and warrants, with respect to Hazardous Materials, as follows: (a) Neither Trustor nor, to the best knowledge of Trustor, any other person, has ever caused or permitted any Hazardous Materials to be manufactured, placed, held, located or disposed of on, under or at the Property/Business or any part thereof, and neither the Property/Business nor any part thereof, or any Property/Business adjacent thereto, has ever been used (whether by the Trustor or, to the best knowledge of the Trustor, by an other person) as a manufacturing site, dump site, or storage site (whether permanent or temporary) for any Hazardous Materials; (b) Trustor hereby agrees to indemnify Beneficiary, its officers, employees contractors, and agents, and hold Beneficiary, its officers, employees, contractors and agents harmless from and against any and all losses, liabilities, damages, injuries, costs, expenses and claims of any and every kind whatsoever paid, incurred or suffered by, or asserted against Beneficiary, its officers, employees, contractors or agents for, with respect to, or as a direct or indirect result of, the presence or use, generation, storage, release, threatened release or disposal of Hazardous Materials on or under the Property/Business or the escape, seepage, leakage, spillage, discharge, emission or release of any Hazardous Materials from the Property/Business(including, without limitation, any losses, liabilities, damages, injuries, costs, expenses, or claims asserted or arising under CERCLA, any so-called "Superfund" or "Superlien" law, or any other federal, State or local statute law, ordinance, code, rule, regulation, order or decree regulating, relating to or imposing liability or standards of conduct concerning any Hazardous Materials) regardless of whether or not caused by or within the control of Trustor. Notwithstanding the foregoing, Trustor's obligations under this section shall not apply to any losses, liabilities, damages, injuries, costs, expense, or claims which arise out of or relate to Hazardous Materials which are generated, released or stored on the Property/Business after the date that Beneficiary takes possession thereof. (c) Trustor has not received any notice of (i) the happening of any event involving the use, spillage, discharge, or cleanup of any Hazardous Materials ("Hazardous Discharge") affecting Trustor or the Property/Business or (ii) any complaint, order, citation, or notice with regard to air emissions, water discharges, noise emissions, or any other environmental, health, or 8 Deed of Trust - 2009 San Diego Pretzel Company. safety matter affecting Trustor, or the PropertyBusiness("Environmental Complaint") from any person or entity, including, without limitations, the United States Environmental Protection Agency ("EPA"). If Trustor receives any such notice after the date hereof, then Trustor will give, within seven (7) days thereafter, oral and written notice of same to Beneficiary. (d) Without limitation of Beneficiary's rights under this Deed of Trust, Beneficiary shall have the right, but not the obligation, to enter onto the Property/Business or to take such other actions as it deems necessary or advisable to clean up, remove, resolve, or minimize the impact of, or otherwise deal with, any such Hazardous Materials or Environmental Complaint upon its receipt of any notice from any person or entity, including without limitation, the EPA, asserting the existence of any Hazardous Materials or an Environmental Complaint on or pertaining to the Property/Business , which if true, could result in an order, suit, or other action against Trustor affecting any part of the Property/Business by any governmental agency or otherwise which, in the sole opinion of Beneficiary, could jeopardize its security under the Deed of Trust. All reasonable costs and expenses incurred by Beneficiary in the exercise of any such rights shall be secured by this Deed of Trust, and shall be payable by Trustor upon demand together with interest thereon at a rate equal to the highest rate payable under the note secured hereby. Continuing Obligations (e) The foregoing representation, covenants, indemnities, and warranties shall be continuing, and shall be true and correct for the period from the date hereof to the release of this Deed of Trust (whether by payment of the indebtedness secured hereby or foreclosure or action in lieu thereof), and these representations, covenants, indemnities, and warranties shall survive such release. Successor Owners (20) Each successor owner of an interest in the Property/Business other than through foreclosure or deed in lieu of foreclosure, shall take its interest subject to this Deed of Trust. Governing Law (21) This Deed of Trust shall be governed by and construed in accordance with the laws of the State of California. 9 Deed of Trust - 2009 San Diego Pretzel Company. ioz8 Dated: � +�- 5, Zoo C, TRUSTOR/BORROWER: Creative Kitchen Specialty Foods, Inc. Harris U1den, Vice President State of Californ' . ) County of0C O befor• me, I T 1 oy 1)0bl ( personally appeared prrts6oklen^5crd" 4 rs proved to me on the basis of satisfactory evidence to be the perso whose nam s ' . 3 subscribed to the within instrument and acknowledged to m that executed the same in -- >f1.21t authorized capaci f , and that by hisflhe signatur on the instrument the perso > , or the entity upon behalf of which the perso4 acted, executed the instrument. 1 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. Sig ature of Notary Public 10 Deed of Trust - 2009 San Diego Pretzel Company. 224 WEST 12— STREET NATIONAL. CITY. CALIFORNIA 9'1 Cf50 PHONE: 6191 336-0500 FAX: 1619336-050 W'WW. SANDIEGORRETZELC:ORI 1'eh uarti 16, 2009 Jacqueline L. Keyllu n National City Chamber of Commerce 901 National City Boulevard National City, ('11 91950-3203 Dear Jaccicreline: Sine( i sllhnlrlled the buRinesr', l)roposai asking for a loan io help pay for marketing, my 0omj)any has taken a turn in a different direction_ Is of 'January 2009, a shall company, Your 11Jamiis Cookies, has closed their kitchen facility alacl has asked the San 1)iegr) Pretzel co -pack their products for them. lt, has been estimated that t)y co -packing products for Your Marna's Kitchen, our sales W111 increase. by al)l)ro imatoly SJ( iIn order to have enough freezer ,storage for the higher sales volume. w4'- CIlUst convert a 15 It. X 16 tt. walk-in (cooler 1n10 a freezer. Attached .1re> 3 heels IUr the walk-in cooler freezer cony e'rslein. The money h-om CDC will help offset some or the' co,,ts iur tJx' hailel->>)ut., 1 am most grateful for the financial hell). Sind»e'ly, r 1 tarns (loiden V 1' Stan 1)iew) fret/it Exhibit A PACIFIC REFRIGERATItJ1 V,Vz. A/C SERVICE d'®. San Diego Pretzel 224 W. 12`h Street National City, Ca 91950-4308 Phone 619-336-0500 Contact: Harris Golden, President — CEO Date Feb 11. 2009 We are pleased to submit the following quotation for your consideration. Subject: Walk In Cooler to Walk In Freezer Conversion Box Dimensions: 15 ft x 16 x 12 ft high Area: 240 Sq ft / 2,880 cu ft Proposal Remove existing cooler mechanical system refrigerant and fan coil. Create thermal cuts on all ceiling and wall panels to prevent thermal transfer to the exterior of the box.. Reinstall trim. Remove existing 36 x 78 door and install after floor is installed. Furnish and Install One (1) Outdoor Heatcraft — Climate Control Air Cooled 6 HP Low Temp Scroll Condensing Unit with One (I) Matching Medium Profile Electric Defrost Evaporator Fan Coil. Refrigerant Type: R-404a Outdoor Condensing Unit Features: Painted Galvanize Cabinet, Air Cooled Condenser, Low Temp Scroll Compressor, Defrost Timer and Contractor Kit, Dual Pressure Control, Fused Disconnect, Phase Loss Monitor, Liquid Line Sight Glass, Liquid Line Drier, Suction Filter, Suction Accumulator. UL Listed. Voltages: 208-230 Volt 3 Phase Evaporator Fan Coil Features: Medium Profile, 27,160 BTU (0,-10 Deg F SST, Electric Defrost, 7,320 CFM ( for 2.5 Air Exchanges per minute.) External Heat Exchanger, Thermal Expansion Valve, Liquid Line Solenoid Valve and Digital Controller, Condensate Drain and Drain Line Heater. Page 1 of 3 4C6 RIEWICO Exhibit B 1440 Broadway • El Cajon, CA 92021 • (619) 441-6960 • FAX (619) 441-9 Furnish and Install One 15 ft x 16 ft Insulated Floor System with Aluminum Tread Plate with Plywood Reinforcement hacking. Floor to Factory Insulated with Foamed in place high density urethane, cam lock, floor to wall cove base. Furnish and install one 48" x 48" Floor ramp in front of the door location. Install Customers 36 x 78 door, Install new frame heater, threshold plate, heated vents and connect to provided 120 volt electrical source. Voltage: 120 Volt Important Note: Heated Vents must be installed to prevent a positive or negative pressure build up in side the low temp area. Material, Tax, Shipping, Crane Services, Refrigerant Recovery and Disposal , Labor Total $ 25, 888.00 Option: Compressor with a 4 Year Warranty Extension Add $ 527.50 Electrical Main Circuits, Breakers, Circuit Conduits, Plumbing such as floor sinks, Permit Fees, Engineering Calculations, Structural Calculations, Shelving, Backing, Bumper Guards, Roof Penetrations, Closure Panels or any other item not expressed within this proposal is NOT Included and are the responsibility of the owner at the additional costs. This Proposal also contains Additional Terms of Agreement and is a part of this agreement as produced and written on Page 3 Initial Here: Limited Warranty: 1 Year Manufactures Compressor and parts per manufactures expressed terms. ( Shipping and Crane Services NOT covered by the manufacture) Labor: 6 Month Terms: 10 % Deposit, 70% On Equipment Arrival, Balance Due On Completion. Signature of Acceptance: Date of Acceptance: Printed Name: Title: Proposal Submitted by Larry Grenz, Project Estimator Phone 619-441-6960, Ext 108 Fax 619-441-9464 Page 2 of 3 TIME IS ESSENTIAL ! It is agreed that if Contractor is required to repair or replace equipment, broken, damaged or destroyed as a result of accident, fire, lightning, floods, riots, strikes or acts of God, Purchaser shall reimburse Contractor for such parts used, in accordance with our current established rates and prices for such service. It is mutually agreed faucets, taps, rods, electrical wiring, air pumps, and plumbing are not covered by this Agreement. The terms of this Agreement are subject to all rules and regulations imposed by govern- mental agencies. It is agreed that Contractor shall under no circumstances be liable for injury or damage to the food contents of any refrigerated equipment. Any warranty on equipment covered by this contract does not cover loss of contents, labor to remove contents, or loss of sales while equipment is out of service. Insurance to cover losses shall be the customer's responsibility. Any additions or alterations made by others on above mentioned equipment shall terminate our obligations hereunder. This Agreement shall not be transferred or assigned without first obtaining our written consent. The above Agreement is hereby accepted with the definite understanding that there are no verbal agreements•changing or modifying this Agreement as written. ADDITIONAL TERMS OF AGREEMENT Purchaser agrees to the following terms and conditions: 1. No transfer, renewal, extension or assignment of this agreement, nor any loss or destruction of or injury to said property shall release Purchaser from his obligations hereunder. Purchaser shall keep said property free from all liens, taxes and encumbrances, and shall promptly procure any license necessary in connection therewith. Commmencement of suit or the obtaining of judgment for all or any portion of the unpaid balance due hereunder shall not pass title to said property to Purchaser, title being retained by Seller or Seller's assignee until this agreement, or a judgment for the unpaid balance due hereunder, and all accrued costs and expenses, are paid in full together with finance charges thereon. The Purchaser agrees to forthwith insure and keep said property insured in favor of the Seller in a company satisfactory to the Seller against loss or damage to the security. If the Pur- chaser fails to procure such insurance and/or fails to deliver evidence of such insurance to the Assignee. The Assignee may, at its option, procure such insurance and the cost for such coverage and finance charges thereon, shall be charged to the Pur- chaser. Any insurance collected by Seller may at its option, be applied to repair or store the personal property which is the subject hereof, or upon the indebtedness of Purchaser. 2. If Purchaser defaults in the performance of his obligations hereunder including the making of any payment provided for herein when due and payable, and submitting true and complete information in "Purchaser's Statement," the Seller, at its option and without notice to Purchaser, may (a) Declare the unpaid principal balance plus earned charges due hereunder immediately due and payable; (b) Sue and obtain judgment against Purchaser for the principal balance plus earned charges remaining unpaid hereunder, together with court costs and reasonable attorney's fees but such suit and/or judgment shall not constitute an elec- tion, waiver or estappel by or against Seller and title and right of possession shall nevertheless remain in Seller until this agree- ment or such judgment is paid in full; or (c) Without prior demand, and with or without legal process, Seller may lawfully take immediate possession of said chattels together with all additions, equipment thereon and accessories thereto wherever the same may be found. Within ten days of taking such possession, Seller shall give written notice to Purchaser (i) of his intention to retain chattels in satisfaction of balance due or (ii) that said chattels will be sold at public sale. (Such notice may be given by delivering the same personally or be depositing it in the United States mail addressed to the Purchaser at his last known address) in either event, Purchaser shall have the right to redeem said chattels within ten days by paying or tendering the amount owing under the agreement. If Seller determines to sell the goods at public sale, the notice to Purchaser shall state the time and place of sale and shall be given at least ten days before the date of such sale, and at any time before such sale. Purchaser may redeem such chattels by paying or tendering the amount owing under this agreement, together with delinquency and extension charges, plus any expense reasonably incurred by Seller in good faith for the repairing, reconditioning or preparing of said goods for sale, and if such redemption is not made, said amounts and the expenses of the subsequent sale shall be payable from the proceeds thereof. Seller may purchase said property at any such sale, (d) in the event that Purchaser shall fail to notify Seller of any change of address or shall not communicate with the Seller for a period of forty-five days after any default in paying installmentdue hereunder, or if Purchaser shall remove chattels from this state without written permission from the Seller. Seller may collect reasonable costs of collection. In the event that the holder of this agreement prevails in any action to enforce the terms of provisions hereof, Purchaser agrees to pay reasonable attorney fees and actual court costs. 3. Purchaser agrees that no representation, warranty or guaranty has been made to him which is not expressly set forth herein. The term "Seller" shall be deemed to include any assignee or subsequent holder of this agreement, and all rights and benefits accruing to the Seller under the terms hereof shall also accrue to Seller's assignee, or any subsequent assignee. In the State of California: Contractors are required by law to be licensed and regulated by the Contractors' State License Board. Any questions concerning a contractor may be referred to the Registrar of the board whose address is: Contractors' State License Board, 9835 Goethe Road, Sacramento, CA 95827 Mailing address: P.O. Box 26000, Sacramento, CA 95826 ADDITIONAL NOTES: San Diego Pretzel Remove refrigerant from existing unit — estimated 36 lbs Based on an existing Receiver size approx 36"x 6" 36 lbs x $8 lb 288.00 Material Mech System -6 HP Low Temp Scroll Cond Unit and Fan coil 10.652.00 Door Frame Heater, Threshold plate 150.00 Heated Vent 2 — Kason 1832 Heated Vent 150.00 Floor, Cove Base and Ramp 4,700.00 Silicone 40.00 Total Material 15,692.00 Tax @ 7.75% 1,216.13 Total Material & Tax 16,908.13 Labor Remove Warehouse fan coil & piping Remove Door and Set aside for reinstallation Cut thermal break cuts on ceiling and walls Install Floor panels and ramp (4" Thick floor and 4 ft x 4 ft ramp) Install 2 Door Heaters and Threshold Install Heated Vents Install Refrig Mech System ( Set Roof Equip, Evaporator Fan Coil, Piping, Drain Line and heater) Install control conduit and defrost circuit Total Labor Other Services Walk In Floor Panel —Freight Crane Services Total Other Services 624.00 60.00 240.00 1,200.00 312.00 150.00 4,800.00 600.87 7,986.87 425.00 280.00 705.00 Total Project Price $ 25,888.00 . • p c: N E.J. /7/ f, / CE.:%C."kL , „Ackicess .) t e,, ."-t, • (, ji-T1 . t-riaH(-"C //A J-,Fa ; • 't Social Security .14:. _Ay./.- Federal Tax 7 ITi ... , .-X Ys / / • ., 7- .. /)./.3;/)."-,'"--7 i), - . 7 ' 'IL ' ' 1/... 'V C./ • . 1 . • Business Naritic-! o ...7 „,--) , / i 1 ; ) ., ; ;,;.) ;ix' Business Address ,7' -I-‘--; _ /71••'" i/z.4,-,/,.../,-.. i, , / ... t \,q.)e of uitisii less Type of Fntity (Check One) Status of Applicant (Please v business owner vtorperation check ore). Property owner with tenant business Business .Ownership ad Manageirierit r Li a 1.s1 p Date Establish:a Pinpri. et ;..) i Name, &ea>, Title &If % or Ownership / :4! Name p Title /4— f),/,, orOwncr5hip Name Title % or Ownership N property owner of business, please attach a copy of the ,qyant deed for the propetty. Project Request .) e' /././ Loan Arricunt / Use of Funds Leasehold Improvements Machinery & Equipment Vehicles Working Capital inve,otory/SupprAes OtherP4 lit Aektit4 Collateral Available (Attach a sheet if necessary) Describe real estate, vehicle,s, or Project Location Sou s of FLi s Applicant's F.quity Bank Financing Private Lender San Diego County CDC Loan ,)thei" :11'! t f / ' -7 t IM Exhibit C 7. Attended the CBL Workshop? 8. Project Criteria Business/ Property Information 1. Year Built: </l ✓7 Square Footage ,S, i/ (' Parcel Number ;SG� 2. Is this an Historical Register Building: Yes No (check one) Is this is a business of known local significance Yes No (check one) 3. Describe proposed project and impact on taxable sales. /e/e�t`� F 6% /ri'• 6. i'/1 el' "I) C MAL2.S E' l /r4,A 6.' ,,7i/C!/7,4 L Gt S t 0/!? f G' y L' t,4 „'L C 1 c it ,^ )V'le%Cl i,LL ! lZ[ G 4e;„ j C " �Gz% �',i Ire') i,' vt e �2; /J rc 1 t� i !/// l7/ y� -l- ib 1 11{7G'C'"�' / CIX�d � u1 G Lf"EGi E' G� t`G✓ JG�_� ; ,:et A hic e4 4. Proposed start date: ,�S// 3�% j' Proposed completion date: C'14) 5. Number of Employees 7 Sales Tax Revenue Generated this Year $ 6. Please indicate how many full-time (FT) and part-time (PT) jobs will be Retained or Created once the project is completed? Retained Created Officials & Managers FT PT FT PT Professione'FT PT FT PT Technicians FT PT FT PT Sales ' ' FT PT FT PT Office/Clerical FT PT FT PT Craft (Skil,pr) FT / PT FT / PT Operationq, (Semi -skilled) FT 3 PT 3 FT 3 PT .3 Laborers (unskilled) FT PT FT PT Service Wq'rrs FT PT FT PT / Yes No (check one) BUSINESS: Yes No Participated in the San Diego State University Small Business Technical Assistance Program? Yes No Participated in Southwestern College's Small Business Development & International Trade Center Technical Assistance Program? IV , Yes No Has a current Business License issued by City of National City (show proof)? t �/ Yes No Is located within National City's Redevelopment Area? (See attached map) // Yes No Creates Additional Jobs? If yes, how many? Part Time Full Time Yes No Located within a Community Benefit District (PBID) and is in good standing? Yes No Applicant has prior business experience in ownership or management? Yes No Has a business plan and marketing plan? �x- Yes No Applicants business complies with all ADA accessibility guidelines? Yes No Has been in operation for more than 5 years? i/ Yes No Has been in operation for more than 10 years` Fvhihit f PREMIER BUSINESSOWNERS POLICY PREMIER RETAIL PROPERTY DECLARATIONS Policy Period: Policy Number: ACP BPR 7841834484 From 04-17-09 To 04-17-10 Description of Premises Number: 001 Building Number: 001 Construction: JOISTED MASONRY Premises Address 224 W 12TH ST NATIONAL CITY CA Occupancy 00 Classification: BAKERIES -SELLING ONLY - 10% OR MORE RETAIL SALES Described as: PRETZEL BAKERY WE PROVIDE INSURANCE ONLY FOR THOSE COVERAGES INDICATED BY A LIMIT OR BY "INCLUDED". The Property Coverage provided at this premises is subject to a $ 5,000 Deductible, unless otherwise stated. COVERAGES LIMITS OF INSURANCE Building - Replacement cost $735, 100 Business Personal Property - Replacement cost *56, 200 ADDITIONAL COVERAGES - the Coverage Form Includes other Additional Coverages not shown. Business Income-ALS- 12 Months- NO HourWaiting Period -60 Day Ordinary Payroll Limit Extra Expense - Actual Loss Sustained (ALS) - 12 Months - NOHour Waiting Period Equipment Breakdown Automatic Increase in Insurance - Building Automatic Increase in Insurance - Business Personal Property Back Up of Sewer and Drain Water (limit shown per Building. subject to $25,000 policy aggregate) Appurtenant Structures - 10% of Building Limit of Insurance - maximum $50,000 any one structure Increased Cost of Construction OPTIONAL INCREASED LIMITS Account Receivable Valuable Papers and Records (At the Described Premises) Forgery and Alteration Money and Securities - Inside the Premises Outside the Premises (Limited) Outdoor Signs Outdoor Trees, Shrubs. Plants and Lawns Business Personal Property Away From Premises Business Personal Property Away From Premises - Transit Included Limit $25,000 $25,000 $10,000 $10,000 $10,000 $2,500 $10,000 $15,000 $15,000 Additional Limit OPTIONAL COVERAGES - Other frequently purchased coverage options. Employee Dishonesty Ordinance or Law - 1 - Loss to Undamaged Portion 2 - Demolition Cost and Broadened increased Cost of Construction INCLUDED INCLUDED INCLUDED 2. 9% $5,000 INCLUDED $25,000 $25,000 $25,000 $10,000 S10,000 $10,000 $2,500 $10,000 $15,000 *15,000 NOT PROVIDED NOT PROVIDED NOT PROVIDED PROTECTIVE SAFEGUARDS This premise has one or more PROTECTIVE SAFEGUARDS identified by symbols herein. Insurance at this premise will be suspended if you do not notify us immediately it any of these safeguards are impaired. See PB 04 30 for a description of each symbol. APPLICABLE SYMBOLS: P- ; PB 81 01 (01-01) DIRECT BILL MACH MAC INSURED COPY UID A3 Page 1 of 2 78 98144 PREMIER BUSINESSOWNERS POLIO! PREMIER RETAIL LIABILITY DECLARATIONS Policy Number: ACP BPR 7341834484 F�li+ v Pit il From 04-i7-09 To 04-17-10 WE PROVIDE INSURANCE ONLY FOR THOSE COVERAGES INDICATED BY A LIMIT OR BY INCLUDED' COVERAGES Liability and Medical Payments Medical Payments Coverage Sub Limit Tenants Properly Damage Legal Liability Sub Limit Personal and Advertising Injury Products - Completed Operations Aggregate General Aggregate (Other than Products - Completed Operations) Per Occurrence Pei Person Per Covered Loss Per Person Or Organization A!I Occurrences All Occurrences LIMITS OF INSURANCE $1,000,000 $5,000 $300,000 $1,000,000 $2,000,000 $2,000,000 AUTOMATIC ADDITIONAL INSUREDS STATUS The following persons or organizations are automatically insureds when you and they have agreed in a written contract or agreement that such person or organization be added as an additional insured on your policy. Co -Owners of Insured Premises Controlling Interest Grantor of Franchise or License Lessors of Leased Equipment Managers or Lessors of Leased Premises Mortgagee, Assignee or Receiver Owners or Other Interest from Whom Land has been Leased State or Political Subdivisions - Permits Relating to Premises PROPERTY DAMAGE DEDUCTIBLE NONE OPTIONAL COVERAGES NONE PROVIDED PB 81 03 (01-01) Included in Liability & Medical Payments Included in Liability & Medical Payments Included in Liability & Medical Payments Included in Liability & Medical Payments Included in Liability & Medical Payments Included in Liability & Medical Payments Included in Liability & Medical Payments Included in Liability & Medical Payments Limit Limit Limit Limit Limit Limit Limit Limit DIRECT BILL MACH MAC INSURED COPY UID AJ 78 98146 UCC FINANCING STATEMENT FOLLOW INSTRUCTIONS (front and back) CAREFULLY A. NAME & PHONE OF CONTACT AT FILER [optional] Mike Dalla, City Clerk, City of National City, (619) 336-4226 B. SEND ACKNOWLEDGMENT TO: (Name and Address) I Mike Dalla Office of the City Clerk City of National City 1243 National City Blvd. Naitonal City, CA 91950 L THE ABOVE SPACE 15 FOR FILING OFFICE USE ONLY 1. DEBTOR'S EXACT FULL LEGAL NAME- insertonlyenedebtorname (lend b)-do notabbreviateorcombine names OR 1a. ORGANIZATION'S NAME Creative Kitchen Specialty Foods, Inc. 1b.INDIVIDUAL'SLASTNAME FIRST NAME MIDDLE NAME SUFFIX lc. MAILING ADDRESS 224 West 12th Street CITY National City STATE CA POSTAL CODE 91950 COUNTRY U.S. Id.$EE INSTRUCTIONS REMOVED ADO'L INFO RE 11e. TYPE OF ORGANIZATION ORGANIZATION DEBTOR I Corporation 'California 11 JURISDICTION OF ORGANIZATION lg. ORGANIZATIONAL ID #, if any piNONE 2. ADDITIONAL DEBTOR'S EXACT FULL LEGAL NAME - insert only 4a4 debtor name (2a or 2b) - do not abbreviate or combine names OR 2a. ORGANIZATION'S NAME 2b. INDIVIDUAL'S LAST NAME FIRST NAME MIDDLE NAME SUFFIX 2c. MAILING ADDRESS CITY STATE POSTAL CODE COUNTRY 2d. BEEINSTRUCTION$ ADD'L INFO RE 12e. TYPE OF ORGANIZATION ORGANIZATION 2f. JURISDICTION OF ORGANIZATION 2g_ ORGANIZATIONAL ID #, if any NONE DEBTOR 3. SECURED PARTY'S NAME (or NAME of TOTAL ASSIGNEE of ASSIGNOR SIP)-insertonlypp4secured party name (3a or3b) OR 3a. ORGANIZATION'S NAME Community Development Commission (CDC) of the City of National City 3b. INDIVIDUAL'S LAST NAME FIRST NAME MIDDLE NAME SUFFIX 3c. MAILING ADDRESS 1243 National City Blvd. CITY National City STATE CA POSTAL CODE 91950 COUNTRY U.S. 4. This FINANCING STATEMENT covers the following collateral: Real property located at 5054 Seachase Drive, San Diego, Ca, 92130, APN No. 304-500-14-00. Lot 76 of Carmel Valley neighborhood 4, unit 7 in the city of San Diego, County of San Diego, state of California according to map thereof number 13341. Filed in the office of the County Recorder of San Diego County July 30,1996. 5. ALTERNATIVE DESIGNATION [d applicable]: LESSEE/LESSOR I 1I CONSIGNEE/CONSIGNOR BAILEE/SAILOR (I�jSELLER/BUYER�AG. LIEN NON-UCC FILING 6. E lThis FINANCING STATEME is to be fi( record] (or recorded) iln the REAL 17, Check to REQl1E�'T SEARCH REPORT(&) on Debtor(s) I'"1 l 1 FSTATE RECORDS Attach Addendum fd aodicablel fADDITIONAI FEET footionall All Debtors Debtor 1 I (Debtor 2 8. OPTIONAL FILER REFERENCE DATA $15,000 Economic Development Loan Program, CDC of National City, CA, DBA San Diego Pretzel Company, Harris Golden International Association of Commercial Administrators (IACA) FILING OFFICE COPY — UCC FINANCING STATEMENT (FORM UCC1) (REV. 05/22/02) City of National City Office of the City Clerk 1243 National City Boulevard, National City, CA 91950-4397 Michael R. Dalla, CMC - City Clerk (619) 336-4228 Fax: (619) 336-4229 July 23, 2009 Mr. David Butler Assessor / Recorder / County Clerk County of San Diego P.O. Box 121750 San Diego, CA 92112-1750 Dear Mr. Butler: We are submitting the following documents in duplicate for recording: DEED OF TRUST: CREATIVE KITCHEN SPECIALTY FOODS, INC. Please note the recording information on the duplicate copy provided, and return it to the Office of the City Clerk. Michael R. Della, CMC City Clerk Enclosure 0 Recycled Paper RECORDING REQUESTED BY Ticor Title -San Diego Branch RECORDING REQUESTED BY: AND WHEN RECORDED MAIL TO: Community Development Commission of the City of National laity 1243 National City Boulevard National City, CA 91950 7528 i i iii i It lull i uiu iuii iiiii uiii iuiiii uii JUN 25, 2010 8:00 AM OFFICIAL RECORDS SAN DIEGO COUNTY RECORDER'S OFFICE DAVID L. BUTLER, COUNTY RECORDER FEES: 18.00 PAGES 4 111111111111111111111111111111111111111111111111111111111111111111111111111111111111 Title Order No.: 2246930 Escrow No.: 009-006074-SD SUBORDINATION AGREEMENT 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, made April 23, 2010, by Harris A. Golden and Sandra C. Golden, as individuals and/or as Trustees of the Harris and Sandra Golden Family Trust, dated February 23, 2006, Owner of the land hereinafter described and hereinafter referred to as "Owner", and Community Development Commission of the City of National City, Present owner and holder of the deed of trust and note first hereinafter described and hereinafter referred to as "Beneficiary"; WITNESSETH THAT WHEREAS, Sandy Golden, President and Harris Golden, Vice President of Creative Kitchen Specialty Foods, Inc., executed a deed of trust, dated May 18, 2009, to Stuart Title Company, A California Corporation, as trustee, covering: LEGAL DESCRIPTION ATTACHED HERETO AS EXHIBIT 'A' AND MADE A PART HEREOF.4'2009-0420270 to secure a note in the sum of $15,000.00, dated May 18, 2009, in favor of Beneficiary, Community Development Commission of the City of National City, which deed of trust 0,64 recorded y rt /tYr/t/gtr011v%t0/011,f 7-28-2009 * WHEREAS, Owner has executed, or is about to execute, a deed of trust and note in the sum of $329,000.00, dated June 4, , 2010 , in favor of Residential Wholesale Mortgage, Inc., hereinafter referred to as "Lender", payable with interest and upon the terms and conditions described therein, which deed of trust is to be recorded concurrently, herewith; and WHEREAS, the lien created by the Community Development Commission of the City of National City hereby agrees to remain in 3rd lien position behind both the new first lien, mentioned above, and also remain subordinate to the current 2nd lien secured by a note in the sum of $137,000.00, in favor of Union Bank of California, N.A. a California Banking Corporation, as Beneficiary, dated 10/30/2006, recorded 11/03/2006 as instrument no. 2006-0786160. WHEREAS, it is a condition precedent to obtaining said loan from Lender that said deed of trust last above mentioned shall unconditionally be and remain at all times a lien or charge upon the land hereinbefore described, prior and superior to the lien or charge of the deed of trust first above mentioned; and WHEREAS, Lender is willing to make said loan provided the deed of trust securing the same is a lien or charge upon the above described property prior and superior to the lien or charge of the deed of trust first above mentioned and provided that Beneficiary will specifically and unconditionally subordinate the lien or charge of the deed of trust first above mentioned to the lien or charge of the deed of trust in favor of Lender; and WHEREAS, it is to the mutual benefit of the parties hereto that Lender make such loan to Owner; and Beneficiary is willing that the deed of trust securing the same shall, when recorded, constitute a lien or charge upon said land which is unconditionally prior and superior to the lien or charge of the deed of trust first above mentioned. 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 Lender to make the loan above referred to, it is hereby declared, understood and agreed as follows; (1) That said deed of trust securing said note in favor of Lender, and any renewals or extensions thereof, shall unconditionally be and remain at all times a lien or charge on the property therein described, prior and superior to the lien or charge of the deed of trust first above mentioned. (2) That Lender would not make its loan above described without this subordination agreement. (3) That this agreement shall be the whole and only agreement with regard to the subordination of the lien of charge of the deed of trust first above mentioned to the lien or charge of the deed of trust in favor of lender above referred to and shall supersede and cancel, but only insofar as would affect the priority between the deeds of trust hereinbefore specifically described, any prior agreement as to such subordination including, but not limited to, SUBORDINATION, CONCURRENTLY RECORDED DEED OF TRUST ONE TO THE OTHER 7529 Bcneficia=y declares, agrees and acknowledges that (a) He consents to and approves (i) all provisions of the note and deed of trust in favor of Lender above referred to, and (ii) all agreements, including but not limited to any loan or escrow agreements, between Owner and Lender for the disbursement of the proceeds of Lender's loan; (b) Lender in making disbursements pursuant to any such agreement is under no obligation or duty to, nor has Lender represented that it will, see to the application of such proceeds by the person or persons to whom Lender disburses such proceeds and any application or use of such proceeds for purposes other than those provided for in such agreement or agreements shall not defeat the subordination herein made in whole or in part; (c) He intentionally and unconditionally waives, relinquishes and subordinates the lien or charge of the deed of trust first above mentioned in favor of the lien or charge upon said land of the deed of trust in favor of Lender above referred to and understands that in reliance upon, and in consideration of, this waiver, relinquishment and subordination specific loan's and advances are being and will be made and, as part and parcel thereof, specific monetary and other obligations are being and will be entered into which would not be made or entered into but for said reliance upon this waiver, relinquishment and subordination; and (d) An endorsement has been placed upon the note secured by the deed of trust first above mentioned that said deed of trust has by this instrument been subordinated to the lien or charge of the deed of trust in favor of Lender above referred to. NOTICE: THIS SUBORDINATION AGREEMENT CONTAINS A PROVISION WHICH ALLOWS THE PERSON OBLIGATED ON YOUR REAL PROPERTY SECURITY TO OBTAIN A LOAN A PORTION OF WHICH MAY BE EXPENDED FOR OTHER PURPOSES THAN IMPROVEMENT OF THE LAND. Community Development Commission of the City of Nation- .ity bY:Chris Zap.Jr. its: City nager Beneficiary ndy Golden Foods, Inc. i _ s Kitchen Specialty Harr'. Golden, Vice President of Creative Kitchen Specialty Foods, Inc. an individual and as Trustee of the amily Trust dated 2/23/06 Harris A. Golden, as an individual and as Trustee of the Harris and Sandra Golden Family Trust dated 2/23/06 Owner 7530 STATE OF CALIFORNIA COUNTY OF ;, l)eljo On i`llcu, f 3 ? Ci / 0 Before me, V f fro' A ; a !tit . cif C Li _ , a Notary Public in and for said State, personally appeared CiN IN v5 ,7�Ct x NJ4` , who proved to me on the basis of satisfactory evdence t6 be the person( whose name(,s - is/ e subscribed to the within instrument and acknowledged to me that he/sheL1hey executed the same in hisib 1theiF authorized capacityiaes), and that by his/herIttaeir signaturesignature,(41 on the instrument the person0, or the entity upon behalf of which the persot(s acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoin paragraph is true and correct. NRGINIA M. ORCUTT WITNESS my hand and official seal.Y .` Commission 1874998 " ' ' Notary Public - California s \r.,,,/ San Diego County Comm. Expires Dec 26, 2013 Signature (This area for official notarial seal) STATE OF CALIFORNIA COUNTY OF S-%/7 �/ On �/Gf/7�/PU/ O Before me, --z).e..,4 a Notary Public in and for said State, personally appeared Qyi,1_,P ,,,/i i ( 6'/6/ ? who proved to me on the basis of satisfactory evidence to be the person whose name) is/at:i✓? subscribed to the within instrument and acknowledged to me that hs/she/executed the same in tiieMer/tjEDauthorized capacity(io;1), and that by hiauar/ttEDsignature(s) on the instrument the personf6), 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 Califomia that the foreggingparagripl,Vie an,Q6Pevari. DEBBIE KECKEISEN COMM. #1734232 n '"�"' NOTARY PUBLIC-CALIFORNIA . SAN DIEGO COUNTY n .�•� My Commission Expires .;. MARCI-I 25, 2011 WITNESS my hand and official seal. Signature 1 (This area for official notarial seal) (ALL SIGNATURES MUST BE ACKNOWLEDGED) IT IS RECOMMENDED THAT, PRIOR TO THE EXECUTION OF THIS SUBORDINATION AGREEMENT, THE PARTIES CONSULT WITH THEIR ATTORNEYS WITH RESPECT THERETO. (CLTA SUBORDINATION FORM "B") EXHIBIT 'A' 7531 Lot 76 of Carmel Valley Neighborhood 4 Unit 7, in the City of San Diego, County of San Diego, State of California, according to Map thereof No. 13341, filed in the Office of the County Recorder of San Diego County, July 30, 1996. Except therefrom all oil, gas minerals, and other hydrocarbon substances lying below the surface of said land, but with no right of surface entry, as provided in Deeds of Record.