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HomeMy WebLinkAbout2019 CON Chicago Title -Section 108 Guaranteed Loan Custodial Agreement - Fire Station 34SECTION 108 GUARANTEED LOAN CUSTODIAL AGREEMENT THIS SECTION 108 GUARANTEED LOAN CUSTODIAN AGREEMENT . ("Agreement") dated as of this loth day of April, 2019, by and between the City of National City, a municipal corporation organized and existing under the laws of the State of California, and having an office for the conduct of business at 1243 National City Boulevard, National City, California 91950 ("Borrower"), and Chicago Title, a California Corporation organized and existing under the laws of the State of California , and having an office for the conduct of business at 701 "B" Street, San Diego, CA 92101, Suite 1120. ("Custodian"). WITNESSETH: WHEREAS, the Borrower has entered into a Contract for Loan Guarantee Assistance Under Section 108 of the Housing and Community Development Act of 1974, as amended, 42 U.S.C. §5308 ("Section 108 Contract") with the Secretary of Housing and Urban Development ("HUD") under the authority of section 108 of title I of the Housing and Community Development Act of 1974, as amended (the "Act"); and WHEREAS, the Custodian is a the Custodian is a Title and Escrow institution regulated by the Department of Insurance; and WHEREAS, the parties to this Agreement desire to set forth the terms and conditions for the deposit and custodianship of the documents evidencing and relating to the loan to be originated under section 108 of the Act, and 24 CFR part 570, subpart M; and WHEREAS, HUD has guaranteed one or more promissory notes issued by the Borrower and numbered B-OO-MC-06-0560 that together do not exceed the principal amount of approximately $2,834,490.00 (started at $6,900,000.00) (the "Section 108 Guaranteed Note"). NOW THEREFORE, in consideration of the mutual undertakings expressed in this Agreement, the parties agree as follows: 1. The Borrower shall from time to time deliver for deposit with the Custodian certain Security Documents as required under the Section 108 Contract and 24 CFR § 570.705(b)(3) (collectively the "Security Documents"). For each such delivery, the Borrower shall furnish the Custodian with a listing of the Security Documents to be deposited, which listing shall be in the form set forth in the attached Security Document List & Custodial Receipt (the "Receipt" or "Receipt(s)"). In receiving Security Documents, and in maintaining any listing or providing any report or communication with respect to the Security Documents, the Custodian shall be required only to review the face of each document received to determine whether it appears regular on its face, appears to relate to the Section 108 Guaranteed Note, and appears to be a Security Document identified in the Receipt. The Custodian shall complete the Receipt(s) by inserting the date received next to each delivered Security Document. Once signed by the Custodian, the Receipt(s) shall document the Custodian's receipt(s) of the Security Documents required by the Section 108 Contract to be deposited with the Custodian. The Custodian shall maintain each original Receipt, together with the Security Documents it identifies, in accordance with the storage requirements in paragraph 3. 2. Borrower's delivery of the Security Documents will be acknowledged by the Custodian through execution and electronic delivery of a copy of the Receipt(s) to HUD at 108Reports@hud.gov. The Custodian shall also provide copies of Receipt(s) to the Borrower. By its delivery of the Security Documents and Receipt(s) to the Custodian, the Borrower certifies to the Custodian that each Security Document listed in that Receipt is in form and substance acceptable to HUD, as required by the Section 108 Contract. Except for Custodian's obligations under this paragraph, and paragraphs 1 and 2 of this Agreement, the Custodian shall not otherwise be under any duty to review, inspect, examine or certify the Security Documents. Without limiting the foregoing, the Custodian shall be entitled to assume the genuineness of each such document and the genuineness and due authority of any signatures appearing thereon, and shall be entitled to assume that each such document is what it purports to be. The Custodian shall have no liability for or obligation with respect to, and shall not be construed or obliged to make any representation or warranty as to: (i) the validity, sufficiency, marketability, genuineness, value, contents or enforceability of any Security Document; (ii) the validity, adequacy or perfection of any lien upon or security interest purported to be evidenced or created thereby; or (iii) to determine that the contents of any Security Document are appropriate for the represented purpose or that any Security Document has actually been recorded or filed, as maybe applicable, or that any Security Document is other than what it purports on its face to be. 3. The Custodian shall segregate and maintain continuous custody and control of all Security Documents on behalf of HUD until the Section 108 Guaranteed Note is paid in full. The Custodian shall hold the Security Documents in secure and fireproof facilities in accordance with customary standards for such storage. The Custodian shall only rely on information pertaining to the payment of the Section 108 Guaranteed Note that is received from or confirmed by the Director of the Financial Management Division of HUD in Washington, DC ("FMD Director"), or another HUD official as may be authorized by HUD in writing ("Other HUD Designee"). 4. At any reasonable time, the Custodian shall make all Security Documents available for examination and audit by representative of the Borrower or HUD. 5. (A) Upon notification to the Custodian by the FMD Director or Other HUD Designee that a default has occurred under the Section 108 Contract, the Custodian shall comply with any request HUD shall make for the delivery to HUD of all Security Documents, and within five business days of any such request by HUD, shall send the Security Documents via courier service to the address identified in paragraph 6 and contemporaneously provide HUD with the tracking information for the package containing the Security Documents. (B) If, following HUD's notification to Custodian of Borrower's default under the Section 108 Contract, HUD elects to assume or transfer the duties and obligations of the Borrower and elects to continue the custodial relationship, the Custodian agrees to continue its obligations herein for HUD for a reasonable period, not to exceed 90 days, on the same terms and conditions as set forth in this Agreement until it receives instructions for disposition of the Security Documents from the FMD Director or Other HUD Designee. However, in no event shall HUD be Page 2 of 8 obligated to pay compensation or a fee for the holding or release of any Security Documents during such reasonable period. If, however, HUD elects to terminate this Agreement, Custodian shall comply with the provisions of this election by HUD. 6. Except for termination or cancellation of this Agreement pursuant to paragraph 5, if during the term of the Section 108 Guaranteed Note the Custodian's duties under this Agreement are discharged or this Agreement is terminated or cancelled, Custodian may release Security Documents to Borrower or to a successor custodian designated in writing by HUD upon presentation by the Borrower of written approval of the FMD Director or Other HUD Designee for the release of Security Documents to the Borrower. Provided, however, if no written approval is presented, the Custodian shall return all Security Documents to HUD within 5 business days at the following address: Attention: Paul Webster, Director Financial Management Division U.S. Department of Housing and Urban Development 451 7th Street SW — Room 7180 Washington, DC 20410 7. Consideration for services to be performed by the Custodian under this Agreement shall be: $3,500.00 8. This Agreement confers rights and remedies upon HUD, and HUD shall be an intended third -party beneficiary of this Agreement. The parties may not amend or terminate this Agreement without the prior written consent of HUD provided, however, that the Custodian may at any time resign under this Agreement by giving not less than sixty (60) days advance written notice thereof to the Borrower and HUD. Prior to the effective date of the resignation, the Borrower shall give written instruction to the Custodian designating a successor Custodian, if applicable. 9. The Custodian shall be entitled to rely on any written instructions or certifications delivered to the Custodian by the Borrower or HUD pursuant to this Agreement, in each case without any independent verification or investigation of the matters set forth therein. 10. Custodian shall not be liable to anyone for anything which it may do or refrain from doing in connection with this Agreement, unless such action constitutes negligence in accordance with customary standards for document storage, gross negligence, willful misconduct, or bad faith on its part. 11. To the extent permitted by applicable law, the Borrower shall indemnify the Custodian and any director, officer, agent or employee of the Custodian from all liability, obligations, losses, claims, damages, actions, suits, proceedings, costs and expenses, including reasonable attorneys' fees, arising out of, connected with, or resulting, directly or indirectly, from the execution, delivery and performance of this Agreement. 12. The Custodian shall be without liability to the Borrower for any damage or loss resulting from or caused by events or circumstances beyond the Custodian's reasonable control Page 3 of 8 including nationalization, expropriation, currency restrictions, the interruption, disruption or suspension of the normal procedures and practices of any securities market, power, mechanical, communications or other technological failures or interruptions, computer viruses or the like, fires, floods, earthquakes or other natural disasters, civil and military disturbance, acts of war or terrorism, riots, revolution, acts of God, work stoppages, strikes, national disasters of any kind, or other similar events or acts; errors by any party in its instructions to the Custodian; or changes in applicable law, regulation or orders. 13. This Agreement may be executed in any number of counterparts and all counterparts taken together shall constitute one and the same instrument. The exchange of copies of this Agreement and of signature pages by facsimile transmission or pdf shall constitute effective execution and delivery of this Agreement as to the parties and may be used in lieu of the original Agreement for all purposes. Signatures of the parties transmitted by facsimile or pdf shall be deemed to be their original signatures for all purposes. 14. The terms of this Agreement are hereby declared to be severable, such that if any term hereof is determined to be invalid or unenforceable, such determination shall not affect the remaining terms. 15. The covenants and agreements set forth herein shall be binding upon and inure to the benefit of each of the parties and their respective successors and permitted assigns. No party shall be permitted to assign their rights under this Agreement without the written consent of the parties and the FMD Director or Other HUD Designee, except that any corporation or association into which the Custodian may be merged or converted or with which it may be consolidated, or any corporation or association resulting from any merger, conversion or consolidation to which the Custodian shall be a party, or any corporation or association to which the Custodian transfers all or substantially all of its corporate trust business, shall be the successor of the Custodian hereunder, and shall succeed to all of the rights, powers and duties of the Custodian hereunder, without the execution or filing of any paper or any further act on the part of any of the parties hereto. 16. This Agreement constitutes the complete and exclusive agreement of the parties with regard to the matters addressed herein and supersedes and terminates as of the date hereof, all prior agreements, agreements or understandings, oral or written between the parties to this Agreement relating to such matters. [Remainder of Page Intentionally Left Blank — Signature Page Follows] Page4of8 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first above written. CITY OF NATIONAL By: Aleja olis, Mayor APPROVED AS TO FORM: Angil P. Morris -Jones By: Roberto M. Contreras Deputy City Attorney `Borrower") CHICAGO TITLE, a California corporation ("Custodian") (Corporation — signatures of two corporate officers required) By: kPUbUS (Name 0-taa AN-Q (Print) �'`-'-/- `, Son.ttYL f,r.Lw(Title) By: (Name) Page 5 of 8 (Print) (Title) Note to Borrowers: the form below is a form of Security Document List & Custodial Receipt that must be completed by the Borrower and submitted to the Custodian for use as a receipt whenever Borrower is required by the Section 108 Contract to submit additional Security Documents (identified in the Section 108 Contract as "Security Documents"). SECURITY DOCUMENT LIST & CUSTODIAL RECEIPT The following documents were delivered in accordance with the agreement dated April 10, 2019, between the undersigned ("Custodian"), and the City of National City ("Borrower"), and which is known as the "Section 108 Guaranteed Loan Custodial Agreement": Mark with Name of Security Document Date Received "X" if received by Custodian The original recorded Deed of Trust signed by the mortgagor securing repayment of the indebtedness evidenced by the Note. A deed of trust title policy, issued by a company and in a form acceptable to the Secretary, naming the Secretary as the insured party. A certified survey with a legal description conforming to the title policy and the Deed of Trust. An appraisal of the fee simple ownership interest in the Property specifying an estimate of fair market value of not less than the current loan balance. The appraisal shall be completed by an appraiser who is certified by the state and has a professional designation (such as "SRA" or "MAP"), and shall conform to the standards of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 ("FIRREA"). An opinion of Borrower's counsel on its letterhead, addressed and satisfactory to the Secretary, that the Deed of Trust is a valid and legally binding obligation, enforceable in accordance with its terms. This is the first Security Document List & Custodial Receipt under the Section 108 Guaranteed Loan Custodial Agreement between Custodian and Borrower dated the 10th day of April, 2019. [Remainder of Page Intentionally Left Blank — Signature Page Follows] The undersigned hereby acknowledges receipt of the documents indicated with an 'X' in the table above, on the dates acknowledged in the table: Name: ✓Lt a AVll l Iiq Title: S-eikk ,(ptE €sauwOniez' Date: — l 51 FREE RECORDING REQUESTED PURSUANT TO GOVERNMENT CODE SECTION 27383 WHEN RECORDED PLEASE MAIL TO: Yl City of National City Housing, Grants, and Asset Management Department Attn: Property Agent 140 East 12th Street National City, CA 91950 A.P.N.: SCe0 - 0011. — os DOC# 2015-0016958 IIIIIIII IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII Jan 14, 2015 02:20 PM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $87.00 PCOR: N/A SPACE ABOVE THIS LINE FOR RECORDER'S USE DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING WITH ASSIGNMENT OF RENTS This Deed of Trust, Security Agreement, and Fixture Filing with Assignment of Rents (this "Deed of Trust") is made as of June 25, 2014, by the City of National City, a municipal corporation ("Trustor"), whose address is 140 East 12th Street, National City, CA 91950, to Chicago Title Company, a California corporation ("Trustee"), whose address is 2365 Northside Drive, Suite 600, San Diego, CA 92108, for the benefit of the Secretary of Housing and Urban Development (`Beneficiary") whose address is 451 Seventh Street, SW, Room 7180, Washington, DC 20410. RECITALS On August 7, 2003, pursuant to the Section 108 Loan Guarantee Program, the City of National City entered into a contract between the Trustor, as Borrower, and the Beneficiary, as guarantor for the guarantee made pursuant to section 108 of Title I of the Housing and Community Development Act of 1974, as amended, and 24 CFR Part 570, Subpart M, of the promissory note numbered B-00-MC-06- 0560, in the Aggregate Principal Amount of $6,900,000.00 (the "Note"), and any amended note or note issued in substitution for such note and having the same note number (the "Contract"). Beneficiary has, among other things, provided a loan guarantee to the Trustor for the construction of Fire Station 34 in the City of National City, on the property described in Exhibit A, and shown on the map in Exhibit B, attached to and incorporated into this Deed of Trust (the Property"). American Medical Response Ambulance Service, dba American Medical Response ("AMR"), leases a certain portion of Fire Station 34 to house an ambulance unit and two AMR paramedics serving Fire Station 34, pursuant to the Lease Agreement Between the City of National City and American Medical Response, dated September 5, 2006 (the "Lease"). ARTICLE I PROPERTY IN TRUST For good and valuable consideration, including the indebtedness cited above and the trust created pursuant to this Deed of Trust, the receipt of which is hereby acknowledged, Trustor hereby grants, transfers, conveys and assigns to Trustee, in Trust, with power of sale, for the benefit and security of Beneficiary, under and subject to the terms and conditions set forth below, all the Trustor's right, title and interest in the Property: (a) Together with Fire Station 34 and any and all buildings and other improvements of whatever nature or kind now or hereafter erected thereon, and all property of Trustor now or hereafter affixed to or placed upon the Property, including, without limitation, all fixtures and attachments (whether fixed or movable) and other articles (including, in each instance, improvements, restorations, replacements, repairs, additions, accessions or substitutions thereto or therefor) it being intended and agreed that all such items will be conclusively considered to be a part of the real property conveyed by this Deed of Trust, whether or not affixed to the real property (the "Improvements"); (b) The rents from the Property, reserving to Trustor the right, prior to any default by Trustor of Trustor's obligations under the Contract, to collect and retain such rents as they become due and payable; (c) This Deed of Trust constitutes a financing statement filed as a fixture filing in the Official Records of the County Recorder of San Diego County with respect to all fixtures included within the term "Property" as used in this Deed of Trust and with respect to any goods, collateral, or other personal property that may now be or later becomes fixtures; and (d) All of the foregoing, together with the Property, shall be hereinafter referred to as the "Security." ARTICLE II OBLIGATIONS SECURED This Deed of Trust is given to secure the performance of all of Trustor's obligations under the Contract, including: (a) Payment of the principal and interest as set forth in the Note payable to order of the Beneficiary in the principal sum of Six Million Nine Hundred Thousand dollars ($6,900,000) or such amount as advanced under the terms of the Note, and other indebtedness of Trustor as provided in the Note, and any extension, modification or renewal of the Note; To protect the Security of the Deed of Trust, the Trustor agrees to: 1) pay and perform all indebtedness and obligations that are secured by this Deed of Trust in accordance with their terms; and, (2) to perform all affirmative covenants and refrain from doing all negative covenants set forth in Articles III-VII of this Deed of Trust; and (c) Notwithstanding any term contained in this Deed of Trust, Trustor's liability shall be limited as set forth in Part II, Paragraph 13, titled "Limited Liability", of the Contract. (b) Deed of Trust, Security Agreement and 2 140 East 12th Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 ARTICLE III MAINTENANCE OF THE SECURITY; EASEMENTS 3.1 Maintenance and Modification of the Security by Trustor. Trustor agrees that, at all times prior to the release of the lien of this Deed of Trust, Trustor shall, at Trustor's own expense, maintain, preserve and keep the Security or cause the Security to be maintained, preserved and kept in good order, condition and repair. Trustor shall from time to time make or cause to be made all repairs, reconstruction, replacements and renewals proper and necessary to perform its obligations hereunder. Beneficiary shall have no responsibility in any of these matters or for the making of improvements or additions to the Security. 3.2 Payment. Trustor shall pay fully and discharge (or cause to be paid fully and discharged) all claims for labor done and for material and services furnished in connection with all or any portion of the Security, diligently to file or procure the filing of a valid notice of completion upon completion of construction of any part of the Security, diligently file of procure the filing of a notice of cessation upon the event of a cessation of labor on the work or construction on the Security for a continuous period of 30 days or more, and to take all other reasonable steps to forestall the assertion of claims of lien against the Security or any part thereof. Within twenty (20) days of a recording of a claim of lien against all or any part of the Security or within twenty (20) days of service upon Beneficiary of a bonded stop notice, Trustor shall satisfy, pay, discharge or make provision satisfactory to Beneficiary in its sole discretion for full payment of such claim or stop notice. 3.3 Granting of Easements. Trustor shall not grant easements, rights -of -way or, other rights or privileges in the nature of easements with respect to any property or rights included in the Security (except those required or desirable solely for installation and maintenance of public utilities serving the Security including, without limitation, water, gas, electricity, sewer, telephone, or those required by law) without the prior written approval of Beneficiary. In the event such rights are granted following Beneficiary's approval, Trustor shall promptly so advise Beneficiary in writing. ARTICLE IV TAXES, INSURANCE, AND ADVANCES 4.1 Taxes, Other Governmental Charges and Utility Charges. Trustor shall pay, or cause to be paid, (i) at least ten (10) days prior to delinquency, all taxes, assessments, charges and levies imposed by any public authority or utility company which are or may become a lien affecting the Security or any part thereof including, without limitation, rent, royalties, profits, and income and (ii) all charges for labor, material and supplies that, if unpaid, might become a lien encumbering any part of the property of Trustor; provided, however, that Trustor shall not be required to pay and discharge any such tax, assessment, charge or levy so long as: Deed of Trust, Security Agreement and 3 140 East 12th Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 a. the legality thereof shall be promptly and actively contested in good faith and by appropriate proceedings; or b. no part of the Security is subject to forfeiture or sale. With respect to special assessments or other similar governmental charges, Trustor shall pay such amount in full prior to the attachment of any lien therefor on any part of the Security unless Trustor has secured the prior written approval of Beneficiary to pay such amounts in installments over a period of years. In the event that Trustor shall fail to pay any of the foregoing items required by this Section to be paid by Trustor, Beneficiary may (but shall be under no obligation to) pay the same, after Beneficiary has notified Trustor of such failure to pay and Trustor fails to fully pay such item within three (3) business days after receipt of such notice. Any amount so advanced therefor by Beneficiary, together with interest thereon from the date of such advance, shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust and Trustor agrees to pay all such amounts. 4.2 Insurance. Trustor is permissively self -insured pursuant to the rules and regulations applicable in the State of California. Additionally, Trustor possesses excess liability risk financing through SANDPIPA, a Municipal Insurance pool. 4.3 Advances. In the event Trustor shall fail to keep the Security in good order, repair, and operating condition, Beneficiary may (but shall be under no obligation to) make such repairs or replacements as are necessary and provide for payment thereof; and all amounts so advanced therefor by Beneficiary shall become an additional obligation of Trustor to Beneficiary (together with interest from the date of the advance until the date paid by Trustor) and shall be secured by this Deed of Trust, which amounts Trustor agrees to pay on the demand of Beneficiary. ARTICLE V DAMAGE, DESTRUCTION, OR CONDEMNATION 5.1 Damage and Destruction. T rustor shall promptly notify Beneficiary in writing after any loss or damage caused by fire or other casualty to the Property, and shall furnish evidence satisfactory to Beneficiary of the repairs or reconstruction of the Property. 5.2 Condemnation. Trustor, immediately upon obtaining knowledge of the institution of any proceedings for the condemnation of the Property or any portion of it, shall notify Trustee and Beneficiary of the pendency of the proceedings. Trustee and Beneficiary may participate in and control any proceedings and Trustor from time to time shall deliver to Beneficiary all instruments requested by Beneficiary to permit participation and control. If there are condemnation proceedings, the award or compensation payable is assigned to and will be paid to Beneficiary. Deed of Trust, Security Agreement and 4 140 East 12th Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 ARTICLE VI REPRESENTATIONS, COVENANTS, AND WARRANTIES OF THE TRUSTOR 6.1 Defense of the Title. Trustor covenants that it is lawfully seized and possessed of title in fee simple to the Security, that it has good right to sell, convey or otherwise transfer or encumber the Security, and that Trustor, for itself and its successors and assigns, warrants and will defend the right and title to the foregoing described and conveyed Security unto Beneficiary, its successors and assigns, against the claims of all persons whomsoever, excepting only encumbrances approved in writing by Beneficiary. 6.2 Inspection of the Security. Trustor covenants and agrees that at any and all reasonable times, Beneficiary and its duly authorized agents, attorneys, experts, engineers, accountants and representatives, shall have the right, without payment of charges or fees, to inspect the Security. 6.3 Waste. Trustor shall not commit any waste on the Security or take any actions that might invalidate any insurance carried on the Security. The Trustor shall maintain the Security in good order, condition, and repair. 6.4 Records. The Trustor shall keep adequate books and records of account of the Security and its own financial affairs sufficient to permit the preparation of financial statements therefrom in accordance with generally accepted accounting principles. The Beneficiary shall have the right to examine, copy and audit the Trustor's records and books of account at all reasonable times. 6.5 Trustor's Estoppel. The Trustor shall promptly furnish, upon the Beneficiary's request made at any time and from time to time during the term of this Deed of Trust, a duly acknowledged written statement setting forth all amounts due on the indebtedness secured by this Deed of Trust and stating whether any offsets or defenses exist, and containing such other matters as the Beneficiary may reasonably require. ARTICLE VII AGREEMENTS AFFECTING THE SECURITY, FURTHER ASSURANCES, AND PAYMENT OF PRINCIPAL 7.1 Contract and Other Agreements Affecting Security. Trustor shall duly and punctually perform all terms, covenants, conditions and agreements binding upon it under the Contract and/or any other agreements affecting the Security and/or any other deed of trust or other instrument or agreement encumbering the Security and/or any lease or any other agreement of any kind or nature whatsoever now or hereafter involving or affecting the Security or any part thereof. 7.2 Further Assurances. At any time, and from time to time, upon the request of Beneficiary, Trustor shall make, execute and deliver, or cause to be made, executed and delivered, to Beneficiary and, where appropriate, cause to be recorded and/or filed, and from time to time Deed of Trust, Security Agreement and 5 140 East l2th Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 thereafter to be re -recorded and/or refiled, at such time and in such offices and places as shall be deemed desirable by Beneficiary, any and all such other and further deeds of trust, security agreements, financing statements and continuation statements, instruments of further assurance, and other certificates and documents as may be, in the opinion of Beneficiary, reasonably necessary to effectuate, complete or perfect, or to continue and preserve: (a) the obligations of Trustor under this Deed of Trust; (b) the lien of this Deed of Trust; and (c) any right, title or interest of Beneficiary in or to the Security. 7.3 Payment of the Principal and Interest. Trustor shall promptly pay to Beneficiary, or its designee, the principal, interest and other sums as set forth in the Note in the amounts and by the times set out therein. 7.4 Subro2ation; Payment of Claims. Beneficiary shall be subrogated to the claims and liens of all parties, whose claims or liens are discharged or paid by Beneficiary pursuant to the provisions hereof. If this Deed of Trust is subject to a prior lien, (approved in writing by Beneficiary), as permitted by law, Beneficiary shall have the right to pay and discharge the obligations secured by said lien. 7.5 Operation of the Security. Trustor agrees and covenants to operate the Security (and, in case of a permitted transfer of a portion of the Security, the transferee shall operate such portion of the Security) in full compliance with this Deed of Trust. ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES 8.1 Events of Default. The events that shall constitute a default under this Deed of Trust (each such event is referred to herein from time to time as an "Event of Default") are those set forth in Part II, Paragraph 11(a), titled "Default'. of the Contract. The Trustor shall be given the opportunity by Beneficiary and Trustee to cure any default prior to Beneficiary invoking any remedy, including those set forth in the Deed of Trust and the Contract. 8.2 Acceleration of Maturity. In the Event of Default as set forth above, the Beneficiary, prior to acceleration, shall give notice to Trustor specifying: (a) The breach; (b) The action required to cure such breach; (c) A date, not less than 10 business days from the date the notice is mailed to Trustor, by which such breach must be cured; and (d) That failure to cure such breach on or before the date specified in the notice may result in acceleration of the sums secured by this Deed of Trust and sale of the Property. Deed of Trust, Security Agreement and 6 140 East 12h Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 The notice shall further inform Trustor of the right to reinstate after acceleration and the right to bring a court action to assert the nonexistence of a default or any other defense of Trustor to acceleration of sale. If the breach is not cured on or before the date specified in the notice, Beneficiary, at Beneficiary's option, may declare all of the sums secured by this Deed of Trust to be immediately due and payable without further demand and may invoke the power of sale and any other remedies permitted by applicable law. Beneficiary shall be entitled to collect all reasonable costs and expenses incurred in pursuing the remedies provided in this Paragraph, except for attomey's fees. The time in which to cure may be extended by Trustor upon notice to Beneficiary that Trustor is making good faith attempts to cure the default and that additional time is required to cure the Event of Default. Trustor may provide the date by which it expect the default to be cured. If Beneficiary invokes power of sale after Trustor's failure to cure, Beneficiary shall execute or cause Trustee to execute a written notice of the occurrence of an Event of Default and of Beneficiary's election to cause the Property to be sold and shall cause such notice to be recorded in each county in which the Property or some part thereof is located. Beneficiary or Trustee shall mail copies of such notice in the manner prescribed by applicable law. Trustee shall give public notice of sale to the persons and in the manner prescribed by applicable law. After the lapse of such time as may be required by applicable law, Trustee, after notice to Trustor, shall sell the Property at public auction to the highest bidder at the time and place and under the terms designated in the notice of sale in one or more parcels and in such order as Trustee may determine. Trustee may postpone sale of all or any parcel of the Property by public announcement at the time and place of any previously scheduled sale. Beneficiary or Beneficiary's designee may purchase the Property at any sale. Trustee shall deliver to the purchaser Trustee's deed conveying the Property so sold without any covenant or warranty, expressed or implied. The recitals in the Trustee's deed shall be prima facie evidence of the truth of the statements made therein. Trustee shall apply the proceeds of the sale in the following order: (a) To all reasonable costs and expenses of the sale, except for attorney's fees; (b) To all sums secured by this Deed of Trust; and (c) The excess, if any, to the person or persons legally entitled thereto. 8.3 Trustor's Right to Reinstate. Notwithstanding Beneficiary's acceleration of the sums secured by this Deed of Trust due to Trustor's Event of Default, Trustor shall have the right to have any proceedings begun by Beneficiary to enforce this Deed of Trust discontinued at any time prior to three (3) days before sale of the Property pursuant to the power of sale contained in this Deed of Trust or at any time prior to entry of a judgment enforcing this Deed of Trust if: (a) Trustor cures all breaches of any other covenants or agreements of Trustor contained in the Deed of Trust; and Deed of Trust, Security Agreement and 7 140 East 12th Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 (b) Trustor pays all reasonable expenses incurred by Beneficiary and Trustee in enforcing the covenants and agreements of Trustor contained in this Deed of Trust, and in enforcing Beneficiary's and Trustee's remedies, except attorney's fees. Upon such cure by Trustor, this Deed of Trust and the obligations secured hereby shall remain in full force and effect as if no acceleration had occurred. 8.4 Fee for Requested Statements. The Beneficiary may charge a fee not to exceed Sixty Dollars ($60.00) for furnishing the statement of obligation as provided in Section 2943 of the Civil Code of California. 8.5 Remedies Cumulative. No right, power or remedy conferred upon or reserved to Beneficiary by this Deed of Trust is intended to be exclusive of any other right, power or remedy, but each and every such right, power and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy given hereunder or now or hereafter existing at law or in equity. 8.6 No Waiver. No delay or omission of Beneficiary to exercise any right, power or remedy accruing upon any Event of Default shall exhaust or impair any such right, power or remedy, or shall be construed to be a waiver of any such Event of Default or acquiescence therein; and every right, power and remedy given by this Deed of Trust to Beneficiary may be exercised from time to time and as often as may be deemed expeditious by Beneficiary. No consent or waiver, expressed or implied, by Beneficiary to or of any breach by Trustor in the performance of the obligations hereunder shall be deemed or construed to be a consent to or waiver of obligations of Trustor hereunder . Failure on the part of Beneficiary to complain of any act or failure to act or to declare an Event of Default, irrespective of how long such failure continues, shall not constitute a waiver by Beneficiary of its right hereunder or impair any rights, powers or remedies consequent on any breach or Event of Default by Trustor. If Beneficiary (i) grants forbearance or an extension of time for the payment of any sums secured hereby, (ii) takes other or additional security or the payment of any sums secured hereby, (iii) waives or does not exercise any right granted herein or in the Contract or in the Note, (iv) releases any part of the Security from the lien of this Deed of Trust, or otherwise changes any of the terms, covenants, conditions or agreements of this Deed of Trust, the Contract, or the Note (v) consents to the granting of any easement or other right affecting the Security, or (vii) makes or consents to any agreement subordinating the lien hereof, any such act or omission shall not release, discharge, modify, change or affect the original liability under this Deed of Trust, or any other obligation of Trustor or any subsequent purchaser of the Security or any part thereof, or any maker, co-signer, endorser, surety or guarantor (unless expressly released); nor shall any such act or omission preclude Beneficiary from exercising any right, power or privilege herein granted or intended to be granted in an Event of Default then made or of any subsequent Event of Default, nor, except as otherwise expressly provided in an instrument or instruments executed by Beneficiary, shall the lien of this Deed of Trust be altered thereby. In the event of the sale or transfer by operation of law or otherwise of all or any part of the Security, Beneficiary, without notice, is hereby authorized and empowered to deal with any such vendee or transferee with Deed of Trust, Security Agreement and 8 140 East 12t' Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 reference to the Security (or a part thereof) or the indebtedness secured hereby, or with reference to any of the terms, covenants, conditions or agreements hereof, as fully and to the same extent as it might deal with Trustor, and without in any way releasing or discharging any liabilities, obligations or undertakings of Trustor. 8.7 Trustee May File Proofs of Claim. In the case of any receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or other proceedings affecting Trustor, its creditors or its property, Beneficiary, to the extent permitted by law, shall be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of Beneficiary allowed in such proceedings for the entire amount due and payable by Trustor under this Deed of Trust at the date of the institution of such proceedings including, without limitation, any additional amount which may become due and payable by Trustor hereunder after such date. ARTICLE IX MISCELLANEOUS 9.1 Amendments. This instrument cannot be waived, changed, discharged or terminated orally, but only by an instrument in writing signed by the parties. 9.2 Reconveyance by Trustee. Upon written request of Beneficiary stating that all sums secured hereby have been paid, and upon surrender of this Deed of Trust to Trustee for cancellation and retention, and upon payment by Trustor of Trustee's reasonable fees, except for attorney fees, Trustee shall reconvey to Trustor, or to the person or persons legally entitled thereto, without warranty, the Security then held hereunder. Such person or persons shall pay all recording fees. The recitals in such reconveyance of any matters or facts shall be conclusive proof of the truthfulness thereof. The grantee in any reconveyance may be described as "the person or persons legally entitled thereto." 9.3 Notices. Whenever Beneficiary, Trustor or Trustee shall desire to give or serve any notice, demand, request or other communication with respect to this Deed of Trust, each such notice, demand, request or other communication shall be in writing and shall be effective only if the same is delivered by personal service or mailed by certified mail, postage prepaid,return receipt requested, addressed to the address set forth in the first paragraph of this Deed of Trust. Any party may at any time change its address for such notices by delivering or mailing to the other parties hereto, as aforesaid, a notice of such change. 9.4 Trustee. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. Beneficiary may from time to time, by instrument in writing, substitute a successor or successors to any Trustee named herein or acting hereunder, which instrument, executed by Beneficiary and duly acknowledged and recorded in the office of the San Diego County Recorder, shall be conclusive proof of proper substitution of such successor Trustee or Trustees, who shall, without conveyance from the Trustee predecessor, succeed to all its title, estate, rights, powers and duties. Said instrument must contain the name of the original Deed of Trust, Security Agreement and 9 140 East 12'h Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 Trustor, Trustee and Beneficiary hereunder, the book and page where this Deed of Trust is recorded and the name and address of the new Trustee. 9.5 Captions. The captions or headings at the beginning of each Section hereof are for the convenience of the parties and are not a part of this Deed of Trust. 9.6 Invalidity of Certain Provisions. Every provision of this Deed of Trust is intended to be severable. In the event any term or provision hereof is declared to be illegal or invalid for any reason whatsoever by a court of competent jurisdiction, such illegality or invalidity shall not affect the balance of the terms and provisions hereof, which terms and provisions shall remain as binding and enforceable. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt, or if the lien is invalid or unenforceable as to any part of the Security, the unsecured or partially secured portion of the debt, and all payments made on the debt, whether voluntary or under foreclosure or other enforcement action or procedure, shall be considered to have been first paid on and applied to the full payment of that portion of the debt which is not secured or partially secured by the lien of this Deed of Trust. 9.7 No Merger. Any interest the Beneficiary may hold in the Security shall be freely alienable separate and apart from any other such interest. In the event that Beneficiary acquires an interest, whether as beneficiary under a deed of trust or otherwise, in any lease or reversion in the Security, or any part thereof, and if both the lessor's and lessee's estate under any such lease or any portion thereof shall at any time become vested in one owner, this Deed of Trust and the lien created hereby shall not be destroyed or terminated by application of the doctrine of merger and, in such event, Beneficiary shall continue to have and enjoy all of the rights and privileges of Beneficiary as to the estates of lessor and lessee. In addition, upon foreclosure under this Deed of Trust pursuant to the provisions hereof, any leases or subleases then existing and affecting all or any portion of the Security shall not be destroyed or terminated by application of the law of merger or as a matter of law or as a result of such foreclosure unless Beneficiary or any purchaser at any such foreclosure shall so elect. No act by or on behalf of Beneficiary or any such purchaser shall constitute a termination of any lease or sublease unless Beneficiary or such purchaser shall give written notice of termination to such tenant or subtenant. 9.8 Governing Law. This Deed of Trust shall be governed by and construed in accordance with the laws of the State of California. The venue shall be in state or federal court located in San Diego County. 9.9 Gender and Number. In this Deed of Trust the singular shall include the plural and the masculine shall include the feminine and neuter and vice versa, ifthe context so requires. 9.10 Trustor and Beneficiary Defined. The term "the Trustor" includes both the original Trustor and any subsequent owner or owners of any of the Security, and the term "the Beneficiary" includes the original Beneficiary and also any future owner of holder, including pledges and participants, of the Note or any interest therein. Deed of Trust, Security Agreement and 10 140 East 12d' Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 9.11 Successors. The terms of this Deed of Trust will bind and benefit the heirs, legal representatives, successors and assigns of the Trustor and the Beneficiary and the successors in trust of the Trustee. If the Trustor consists of more than one person or entity, each will be jointly and severally liable to perform the obligations of the Trustor. 9.12 No Presumption Regarding Construction. This Deed of Trust was drafted by the Trustor. The presumption that ambiguities are resolved against the drafting party shall be inapplicable, and any such ambiguities shall not be construed against the Trustor. By signing below, Trustor accepts and agrees to the terms and covenants contained in this Deed of Trust in accordance with the terms of the Contract and the Note. Trustor has executed this Deed of Trust as of the day and year first above written. TRUSTOR: CITY OF NATIONAL CITY, a municipal corporation n Morrison, Mayor APPOVED AS TO FORM: By: Deed of Trust, Security Agreement and 1 1 140 East 12i1 Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 Exhibit A LOTS 1 TO 6 INCLUSIVE AND LOTS 11 TO 20 INCLUSIVE IN BLOCK 4 OF 10 ACRE LOT 8 IN QUARTER SECTION 154 OF THE RANCHO DE LE NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 552, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JULY 2, 1888. TOGETHER WITH THOSE PORTIONS OF THE SOUTH HALF OF 15TH STREET, ADJACENT TO LOTS 1 AND 20, VACATED AND CLOSED TO PUBLIC USE BY RESOLUTION NO. 6576 OF THE CITY OF NATIONAL CITY, A CERTIFIED COPY RECORDED MARCH 2, 1956 IN BOOK 5999, PAGE 508 OF OFFICIAL RECORDS. ALSO TOGETHER WITH THE EASTERLY 10 FEET OF C AVENUE ADJACENT TO LOTS 1 THROUGH 6 INCLUSIVE, VACATED AND CLOSED TO PUBLIC USE BY RESOLUTION NO. 6759 OF THE CITY OF NATIONAL CITY, A CERTIFIED COPY RECORDED OCTOBER 5, 1956 IN BOOK 6287, PAGE 413 OFFICIAL RECORDS. ALSO TOGETHER WITH THAT PORTION OF THE SOUTH HALF OF 15TH STREET ADJACENT TO LOTS 1 AND 20 AND THE ALLEY LYING BETWEEN LOTS 1 THROUGH 6 INCLUSIVE AND LOTS 15 THROUGH 20 INCLUSIVE VACATED AND CLOSED TO PUBLIC USE BY RESOLUTION NO. 2004-44 OF THE CITY OF NATIONAL CITY, A CERTIFIED COPY RECORDED MARCH 29, 2004 AS FILE NO. 2004-0257565 OFFICIAL RECORDS. APN: 560-092-08 Deed of Trust, Security Agreement and 12 140 East 12th Street, National City, CA Fixture Filing with Assignment of Rents June 25, 2014 760-235-68 2 I Li ST 1 Exhibit B fi • 20 3 I: 118 4 I:117 5 >. 1• fi< 15 lir..NIP .P.atr — milibqii___ — CD 7 /4 ErL K e 1 /3 ( --SEE DETAIL ct_st) CLSD fi — —4 1.40 AC 092 California Acknowledgment Form State of California County of S^ Di -et } SS. On �p��"' a� 12-0t before me, personally appeared 0, j�l o rr s o who proved to me on the basis of satisfactory evidence to be the person(K whose name is/asubscribed to the within instrument and acknowledged to me that he/s /tidy executed the sam in his/1),4r/tt it au- thorized capacity(iys), and that by his/hfr/thfr signature on the instrument the person(; or the entity upon behalf of which the person() acted, executed the i strument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. Seal WITNESS my hand an 1)official seal Signature Notes ANGELITA MARCHANTE I COMM. # 2046693 C NOTARY PUBLIC•CALIFOANIA z SAN DIEGO COUNTY My Comm. Exp. October 25.2017 I Please provide information about the document that this form is attached to. ***This is not required under California State notary public law.*** ©2007 Golden State Notary, Inc. www.GoldenStateNotary.com (888) 263-1977 Chicago Title Company 2365 Northside Drive, Suite 600, San Diego, CA 92108 Phone: (619) 521-3500 • Fax: (619) 521-3608 Issuing Policies of Chicago Title Insurance Company ORDER NO.: 00097098-993-SD2-CFU City of National City 140 E. 12th Street, Suite B National City, CA 91950 ATTN: Gregory Rose Email: grose@nationalcityca.gov Ref: Escrow/Customer Phone: (619) 521-3500 Title Officer: Ken Cyr & Mark Franklin Title Officer Phone: (619) 521-3673 Title Officer Fax: (619) 521-3608 Title Officer Email: TeamCyrFranklin@ctt.com PROPERTY: 343 E. 16TH STREET, NATIONAL CITY, CA PRELIMINARY REPORT In response to the application for a policy of title insurance referenced herein, Chicago Title Company hereby reports that it is prepared to issue, or cause to be issued, as of the date hereof a policy or policies of title insurance describing the land and the estate or interest therein hereinafter set forth, insuring against loss which may be sustained by reason of any defect, lien or encumbrance not shown or referred to as an exception herein or not excluded from coverage pursuant to the printed Schedules, Conditions and Stipulations or Conditions of said policy forms. The printed Exceptions and Exclusions from the coverage and Limitations on Covered Risks of said policy or policies are set forth in Attachment One. The policy to be issued may contain an arbitration clause. When the Amount of Insurance is less than that set forth in the arbitration clause, all arbitrable matters shall be arbitrated at the option of either the Company or the Insured as the exclusive remedy of the parties. Limitations on Covered Risks applicable to the CLTA and ALTA Homeowner 's Policies of Title Insurance which establish a Deductible Amount and a Maximum Dollar Limit of Liability for certain coverages are also set forth in Attachment One. Copies of the policy forms should be read. They are available from the office which issued this report. This report (and any supplements or amendments hereto) is issued solely for the purpose of facilitating the issuance of a policy of title insurance and no liability is assumed hereby. If it is desired that liability be assumed prior to the issuance of a policy of title insurance, a Binder or Commitment should be requested. The policy(s) of title insurance to be issued hereunder will be policy(s) of Chicago Title Insurance Company, a Florida corporation. Please read the exceptions shown or referred to herein and the exceptions and exclusions set forth in Attachment One of this report carefully. The exceptions and exclusions are meant to provide you with notice of matters which are not covered under the terms of the title insurance policy and should be carefully considered. It is important to note that this preliminary report is not a written representation as to the condition of title and may not list all liens, defects and encumbrances affecting title to the land Chicago Title Company By' Authorized Signature By Randy Quirts President Attest Michael Graved& Secretary CLTA Preliminary Report Form — Modified (11/17/06) Page 1 Chicago Title Company 2365 Northside Drive, Suite 600, San Diego, CA 92108 Phone: (619) 521-3500 • Fax: (619) 521-3608 PRELIMINARY REPORT EFFECTIVE DATE: October 8, 2018 at 7:30 a.m. ORDER NO.: 00097098-993-SD2-CFU The form of policy or policies of title insurance contemplated by this report is: ALTA Extended Loan Policy (6-17-06) 1. THE ESTATE OR INTEREST IN THE LAND HEREINAFTER DESCRIBED OR REFERRED TO COVERED BY THIS REPORT IS: A FEE 2. TITLE TO SAID ESTATE OR INTEREST AT THE DATE HEREOF IS VESTED IN: CITY OF NATIONAL CITY, a municipal corporation 3. THE LAND REFERRED TO IN THIS REPORT IS DESCRIBED AS FOLLOWS: See Exhibit A attached hereto and made a part hereof. CLTA Preliminary Report Form — Modified (11/17/06) Page 2 PRELIMINARY REPORT Chicago Title Company YOUR REFERENCE: ORDER NO.: 00097098-993-SD2-CFU EXHIBIT "A" LEGAL DESCRIPTION THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF NATIONAL CITY, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: LOTS 1 TO 6 INCLUSIVE AND LOTS 11 TO 20 INCLUSIVE IN BLOCK 4 OF 10 ACRE LOT 8 IN QUARTER SECTION 15 OF THE RANCHO DE LA NACION, IN THE CITY OF NATIONAL, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 552, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JULY 2, 1888. TOGETHER WITH THOSE PORTIONS OF THE SOUTH HALF OF 15TH STREET, ADJACENT TO LOTS 1 AND 20, VACATED AND CLOSED TO PUBLIC USE BY RESOLUTION NO. 6576 OF THE CITY OF NATIONAL CITY, A CERTIFIED COPY OF RECORDER MARCH 2, 1956, IN BOOK 5999, PAGE 508 OF OFFICIAL RECORDS. ALSO TOGETHER WITH THE EASTERLY 10 FEET OF C AVENUE ADJACENT TO LOTS1 THROUGH 6 INCLUSIVE, VACATED AND CLOSED TO PUBLIC USE BY RESOLUTION NO. 6759 OF THE CITY OF NATIONAL CITY, A CERTIFIED COPY RECORDED OCTOBER 5, 1956 IN BOOK 6287, PAGE 413 OF OFFICIAL RECORDS. ALSO TOGETHER WITH THAT PORTION OF SOUTH HALF 15TH STREET ADJACENT TO LOTS 1 AND 20 AND ALLEY LYING BETWEEN LOTS 1 THROUGH 6 INCLUSIVE AND LOT 15 THROUGH 20 INCLUSIVE VACATED AND CLOSED TO PUBLIC USE BY RESOLUTION NO. 2004-44 OF THE CITY OF NATIONAL CITY, A CERTIFIED COPY RECORDED MARCH 29, 2004 AS FILE NO. 2004-0257565 OF OFFICIAL RECORDS. APN: 560-092-08 CLTA Preliminary Report Form — Modified (11/17/06) Page 3 PRELIMINARY REPORT Chicago Title Company YOUR REFERENCE: ORDER NO.: 00097098-993-SD2-CFU EXCEPTIONS AT THE DATE HEREOF, ITEMS TO BE CONSIDERED AND EXCEPTIONS TO COVERAGE IN ADDITION TO THE PRINTED EXCEPTIONS AND EXCLUSIONS IN SAID POLICY FORM WOULD BE AS FOLLOWS: A. Taxes not assessed. B. The lien of supplemental or escaped assessments of property taxes, if any, made pursuant to the provisions of Chapter 3.5 (commencing with Section 75) or Part 2, Chapter 3, Articles 3 and 4, respectively, of the Revenue and Taxation Code of the State of California as a result of the transfer of title to the vestee named in Schedule A or as a result of changes in ownership or new construction occurring prior to Date of Policy. 1. Easement(s) for the purpose(s) shown below and rights incidental thereto, as granted in a document: Granted to: Sweetwater Water Company Purpose: pipelines Recording Date: July 11, 1902 Recording No: in Book 320, page 364 of Deeds Affects: The exact location and extent of said easement is not disclosed of record. 2. Easement(s) for the purpose(s) shown below and rights incidental thereto as reserved in a document; Reserved by: City of San Diego Purpose: public utilities and incidental purposes Recording Date: March 2, 1956 Recording No: in Book 5999, page 508 of Official Records Affects: That portion of 15th Street vacated therein 3. Easement(s) for the purpose(s) shown below and rights incidental thereto as reserved in a document; Reserved by: City of National City Purpose: public utilities and incidental purposes Recording Date: October 5, 1956 Recording No: in Book 6287 page 413 of Official Records Affects: That portion of C Avenue vacated therein 4. Easement(s) for the purpose(s) shown below and rights incidental thereto as reserved in a document; Reserved by: City of National City Purpose: public utilities and incidental purposes Recording Date: March 29, 2004 Recording No: 2004-0257565 of Official Records Affects: That portion of 15th Street and alley between Lots 1-6 and 15-20 vacated therein 5. An unrecorded lease with certain terms, covenants, conditions and provisions set forth therein as disclosed by the document Entitled: Subordination, non -disturbance and attornment agreement Lessor: City of National City, a municipal corporation Lessee: American Medical Response Ambulance Service, Inc., dba American Medical Response ("AMR") Recording Date: January 14, 2015 Recording No: 2015-0016957 of Official Records The present ownership of the leasehold created by said lease and other matters affecting the interest of the lessee are not shown herein. CLTA Preliminary Report Form — Modified (11/17/06) Page 4 PRELIMINARY REPORT • Chicago Title Company YOUR REFERENCE: ORDER NO.: 00097098-993-SD2-CFU EXCEPTIONS (Continued) 6. A deed of trust to secure an indebtedness in the amount shown below, Amount: $6,900,000.00 Dated: June 25, 2014 Trustor/Grantor City of National City, a municipal corporation Trustee: Chicago Title Company, a California corporation Beneficiary: Secretary of Housing and Urban Development Loan No.: Not Shown Recording Date: January 14, 2015 Recording No: 2015-0016958 of Official Records 7. Water rights, claims or title to water, whether or not disclosed by the public records. 8. Matters which may be disclosed by an inspection and/or by a correct ALTA/NSPS Land Title Survey of said Land that is satisfactory to the Company, and/or by inquiry of the parties in possession thereof. 9. Any rights of the parties in possession of a portion of, or all of, said Land, which rights are not disclosed by the public records. The Company will require, for review, a full and complete copy of any unrecorded agreement, contract, license and/or lease, together with all supplements, assignments and amendments thereto, before issuing any policy of title insurance without excepting this item from coverage. The Company reserves the right to except additional items and/or make additional requirements after reviewing said documents. PLEASE REFER TO THE "INFORMATIONAL NOTES" AND "REQUIREMENTS" SECTIONS WHICH FOLLOW FOR INFORMATION NECESSARY TO COMPLETE THIS TRANSACTION. END OF EXCEPTIONS CLTA Preliminary Report Form — Modified (11/17/06) Page 5 PRELIMINARY REPORT Chicago Title Company YOUR REFERENCE: ORDER NO.: 00097098-993-SD2-CFU REQUIREMENTS SECTION None END OF REQUIREMENTS CLTA Preliminary Report Form — Modified (11/17/06) Page 6 PRELIMINARY REPORT Chicago Title Company YOUR REFERENCE: ORDER NO.: 00097098-993-SD2-CFU INFORMATIONAL NOTES SECTION 1. None of the items shown in this report will cause the Company to decline to attach ALTA Endorsement Form 9 to an Extended Coverage Loan Policy, when issued. 2. The Company is not aware of any matters which would cause it to decline to attach CLTA Endorsement Form 116 indicating that there is located on said Land Single Family Residential properties, known as 343 E. 16th Street, located within the city of National City, California, , to an Extended Coverage Loan Policy. 3. Note: Please contact your Title Officer to obtain the current recording fees. Chicago Title Company will pay Chicago Title Insurance Company 12% of the title premium, as disclosed on lines 1107 and 1108 of the HUD-1. 4. Note: The policy of title insurance will include an arbitration provision. The Company or the insured may demand arbitration. Arbitrable matters may include, but are not limited to, any controversy or claim between the Company and the insured arising out of or relating to this policy, any service of the Company in connection with its issuance or the breach of a policy provision or other obligation. Please ask your escrow or title officer for a sample copy of the policy to be issued if you wish to review the arbitration provisions and any other provisions pertaining to your Title Insurance coverage. 5. Notice: Please be aware that due to the conflict between federal and state laws concerning the cultivation, distribution, manufacture or sale of marijuana, the Company is not able to close or insure any transaction involving Land that is associated with these activities. 6. Pursuant to Government Code Section 27388.1, as amended and effective as of 1-1-2018, a Documentary Transfer Tax (DTT) Affidavit may be required to be completed and submitted with each document when DTT is being paid or when an exemption is being claimed from paying the tax. If a governmental agency is a party to the document, the form will not be required. DTT Affidavits may be available at a Tax Assessor -County Clerk -Recorder. 7. Due to the special requirements of SB 50 (California Public Resources Code Section 8560 et seq.), any transaction that includes the conveyance of title by an agency of the United States must be approved in advance by the Company's State Counsel, Regional Counsel, or one of their designees. END OF INFORMATIONAL NOTES Ken Cyr & Mark Franklin/rp CLTA Preliminary Report Form — Modified (11/17/06) Page 7 RESAFE Inquire before you wire! Wire Fraud Alert This Notice is not intended to provide legal or professional advice. If you have any questions, please consult with a lawyer. All parties to a real estate transaction are targets for wire fraud and many have lost hundreds of thousands of dollars because they simply relied on the wire instructions received via email, without further verification. If funds are to be wired in conjunction with this real estate transaction, we strongly recommend verbal verification of wire instructions through a known, trusted phone number prior to sending funds. In addition, the following non-exclusive self-protection strategies are recommended to minimize exposure to possible wire fraud. • NEVER RELY on emails purporting to change wire instructions. Parties to a transaction rarely change wire instructions in the course of a transaction. • ALWAYS VERIFY wire instructions, specifically the ABA routing number and account number, by calling the party who sent the instructions tp you. DO NOT use the phone number provided in the email containing the instructions, use phone numbers you have called before or can otherwise verify. Obtain the phone number of relevant parties to the transaction as soon as an escrow account is opened. DO NOT send an email to verify as the email address may be incorrect or the email may be intercepted by the fraudster. • USE COMPLEX EMAIL PASSWORDS that employ a combination of mixed case, numbers, and symbols. Make your passwords greater than eight (8) characters. Also, change your password often and do NOT reuse the same password for other online accounts. • USE MULTI -FACTOR AUTHENTICATION for email accounts. Your email provider or IT staff may have specific instructions on how to implement this feature. For more information on wire -fraud scams or to report an incident, please refer to the following links: Federal Bureau of Investigation: Internet Crime Complaint Center: http://www.lbi.pov http://www.ic3.Qov Wire Fraud Alert Page 1 Original Effective Date: 5/11/2017 Current Version Date: 5/11/2017 WIRE0016 (DSI Rev. 12/07/17) TM and © Fidelity National Financial, Inc. and/or an affiliate. All rights reserved FIDELITY NATIONAL FINANCIAL, INC. PRIVACY NOTICE Fidelity National Financial, Inc. and its majority -owned subsidiary companies (collectively, "FNF," "our," or "we") respect and are committed to protecting your privacy. This Privacy Notice explains how we collect, use, and protect personal information, when and to whom we disclose such information, and the choices you have about the use and disclosure of that information. Types of Information Collected We may collect two types of information from you: Personal Information and Browsing Information. Personal Information. FNF may collect the following categories of Personal Information: • contact information (e.g., name, address, phone number, email address); • demographic information (e.g., date of birth, gender, marital status); • identity information (e.g., Social Security Number, driver's license, passport, or other government ID number); • financial account information (e.g., loan or bank account information); and • other personal information necessary to provide products or services to you. Browsing Information. FNF may automatically collect the following types of Browsing Information when you access an FNF website, online service, or application (each an "FNF Website") from your Internet browser, computer, and/or mobile device: • Internet Protocol (IP) address and operating system; • browser version, language, and type; • domain name system requests; and • browsing history on the FNF Website, such as date and time of your visit to the FNF Website and visits to the pages within the FNF Website How Personal Information is Collected We may collect Personal Information about you from: • information we receive from you on applications or other forms; • information about your transactions with FNF, our affiliates, or others; and • information we receive from consumer reporting agencies and/or governmental entities, either directly from these entities or through others. How Browsing Information is Collected If you visit or use an FNF Website, Browsing Information may be collected during your visit. Like most websites, our servers automatically log each visitor to the FNF Website and may collect the Browsing Information described above. We use Browsing Information for system administration, troubleshooting, fraud investigation, and to improve our websites. Browsing Information generally does not reveal anything personal about you, though if you have created a user account for an FNF Website and are logged into that account, the FNF Website may be able to link certain browsing activity to your user account. Other Online Specifics Cookies. When you visit an FNF Website, a "cookie" may be sent to your computer. A cookie is a small piece of data that is sent to your Internet browser from a web server and stored on your computer's hard drive. Information gathered using cookies helps us improve your user experience. For example, a cookie can help the website load properly or can customize the display page based on your browser type and user preferences. You can choose whether or not to accept cookies by changing your Internet browser settings. Be aware that doing so may impair or limit some functionality of the FNF Website. Web Beacons. We use web beacons to determine when and how many times a page has been viewed. This information is used to improve our websites. Do Not Track. Currently our FNF Websites do not respond to "Do Not Track" features enabled through your browser. Links to Other Sites. FNF Websites may contain links to other websites. FNF is not responsible for the privacy practices or the content of any of those other websites. We advise you to read the privacy policy of every website you visit. Use of Personal Information FNF uses Personal Information for three main purposes: • To provide products and services to you or in connection with a transaction involving you. • To improve our products and services. • To communicate with you about our, our affiliates', and third parties' products and services, jointly or independently. When Information Is Disclosed We may make disclosures of your Personal Information and Browsing Information in the following circumstances: • to enable us to detect or prevent criminal activity, fraud, material misrepresentation, or nondisclosure; • to nonaffiliated service providers who provide or perform services or functions on our behalf and who agree to use the information only to provide such services or functions; • to nonaffiliated third party service providers with whom we perform joint marketing, pursuant to an agreement with them to jointly market financial products or services to you; • to law enforcement or authorities in connection with an investigation, or in response to a subpoena or court order; or FNF Privacy Statement (Eff. 5/1/2015) Last Updated March 1, 2017 Copyright © 2017. Fidelity National Financial, Inc. All Rights Reserved MISCO219 (DSI Rev. 3/2/17) Page 1 Order No. 00097098-993-SD2-CFU • in the good -faith belief that such disclosure is necessary to comply with legal process or applicable laws, or to protect the rights, property, or safety of FNF, its customers, or the public. The law does not require your prior authorization and does not allow you to restrict the disclosures described above. Additionally, we may disclose your information to third parties for whom you have given us authorization or consent to make such disclosure. We do not otherwise share your Personal Information or Browsing Information with nonaffiliated third parties, except as required or permitted by law. We reserve the right to transfer your Personal Information, Browsing Information, and any other information, in connection with the sale or other disposition of all or part of the FNF business and/or assets, or in the event of bankruptcy, reorganization, insolvency, receivership, or an assignment for the benefit of creditors. By submitting Personal Information and/or Browsing Information to FNF, you expressly agree and consent to the use and/or transfer of the foregoing information in connection with any of the above described proceedings. Please see "Choices With Your Information" to learn the disclosures you can restrict. Security of Your Information We maintain physical, electronic, and procedural safeguards to guard your Personal Information. We limit access to nonpublic personal information about you to employees who need to know that information to do their job. When we provide Personal Information to others as discussed in this Privacy Notice, we expect that they process such information in compliance with our Privacy Notice and in compliance with applicable privacy laws. Choices With Your Information If you do not want FNF to share your information with our affiliates to directly market to you, you may send an "opt out" request by email, phone, or physical mail as directed at the end of this Privacy Notice. We do not share your Personal Information with nonaffiliates for their use to direct market to you. Whether you submit Personal Information or Browsing Information to FNF is entirely up to you. If you decide not to submit Personal Information or Browsing Information, FNF may not be able to provide certain services or products to you. For California Residents: We will not share your Personal Information and Browsing Information with nonaffiliated third parties, except as permitted by California law. For Nevada Residents: You may be placed on our internal Do Not Call List by calling (888) 934-3354 or by contacting us via the information set forth at the end of this Privacy Notice. Nevada law requires that we also provide you with the following contact information: Bureau of Consumer Protection, Office of the Nevada Attorney General, 555 E. Washington St., Suite 3900, Las Vegas, NV 89101; Phone number: (702) 486-3132; email: BCPINFO@ag.state.nv.us. For Oregon Residents: We will not share your Personal Information and Browsing Information with nonaffiliated third parties for marketing purposes, except after you have been informed by us of such sharing and had an opportunity to indicate that you do not want a disclosure made for marketing purposes. For Vermont Residents: We will not share information about your creditworthiness to our affiliates and will not disclose your personal information, financial information, credit report, or health information to nonaffiliated third parties to market to you, other than as permitted by Vermont law, unless you authorize us to make those disclosures. Information From Children The FNF Websites are meant for adults and are not intended or designed to attract persons under the age of eighteen (18).We do not collect Personal Information from any person that we know to be under the age of thirteen (13) without permission from a parent or guardian. International Users FNF's headquarters is located within the United States. If you reside outside the United States and choose to provide Personal Information or Browsing Information to us, please note that we may transfer that information outside of your country of residence for any of the purposes described in this Privacy Notice. By providing FNF with your Personal Information and/or Browsing Information, you consent to our collection, transfer, and use of such information in accordance with this Privacy Notice. FNF Website Services for Mortgage Loans Certain FNF companies provide services to mortgage loan servicers, including hosting websites that collect customer information on behalf of mortgage loan servicers (the "Service Websites"). The Service Websites may contain links to both this Privacy Notice and the mortgage loan servicer or lender's privacy notice. The sections of this Privacy Notice titled When Information is Disclosed, Choices with Your Information, and Accessing and Correcting Information do not apply to the Service Websites. The mortgage loan servicer or lender's privacy notice governs use, disclosure, and access to your Personal Information. FNF does not share Personal Information collected through the Service Websites, except (1) as required or authorized by contract with the mortgage loan servicer or lender, or (2) as required by law or in the good -faith belief that such disclosure is necessary to comply with a legal process or applicable law, to enforce this Privacy Notice, or to protect the rights, property, or safety of FNF or the public. Your Consent To This Privacy Notice; Notice Changes By submitting Personal Information and/or Browsing Information to FNF, you consent to the collection and use of the information in accordance with this Privacy Notice. We may change this Privacy Notice at any time. The revised Privacy Notice, showing the new revision date, will be posted on the FNF Website. Each time you provide information to us following any amendment of this Privacy Notice, your provision of information to us will signify your assent to and acceptance of the terms of the revised Privacy Notice for all previously collected information and information FNF Privacy Statement (Eff. 5/1/2015) Last Updated March 1, 2017 Copyright © 2017. Fidelity National Financial, Inc. All Rights Reserved MISCO219 (DSI Rev. 3/2/17) Page 2 Order No. 00097098-993-SD2-CFU collected from you in the future. We may use comments, information or feedback that you submit to us in any manner that we may choose without notice or compensation to you. Accessing and Correcting Information; Contact Us If you have questions, would like to access or correct your Personal Information, or want to opt -out of information sharing for affiliate marketing, send your requests via email to privacy@fnfcom, by phone to (888) 934-3354, or by mail to: Fidelity National Financial, Inc. 601 Riverside Avenue Jacksonville, Florida 32204 Attn: Chief Privacy Officer FNF Privacy Statement (Eff. 5/1/2015) Last Updated March 1, 2017 Copyright © 2017. Fidelity National Financial, Inc. All Rights Reserved MISCO219 (DSI Rev. 3/2/17) Page 3 Order No. 00097098-993-SD2-CFU Notice of Available Discounts Pursuant to Section 2355.3 in Title 10 of the California Code of Regulations Fidelity National Financial, Inc. and its subsidiaries ("FNF") must deliver a notice of each discount available under our current rate filing along with the delivery of escrow instructions, a preliminary report or commitment. Please be aware that the provision of this notice does not constitute a waiver of the consumer's right to be charged the field rate. As such, your transaction may not qualify for the below discounts. You are encouraged to discuss the applicability of one or more of the below discounts with a Company representative. These discounts are generally described below; consult the rate manual for a full description of the terms, conditions and requirements for each discount. These discounts only apply to transaction involving services rendered by the FNF Family of Companies. This notice only applies to transactions involving property improved with a one -to -four family residential dwelling. FNF Underwritten Title Company FNF Underwriter CTC - Chicago Title Company CTIC - Chicago Title Insurance Company Available Discounts CREDIT FOR PRELIMINARY REPORTS AND/OR COMMITMENTS ON SUBSEQUENT POLICIES (CTIC) Where no major change in the title has occurred since the issuance of the original report or commitment, the order may be reopened within 12 months and all or a portion of the charge previously paid for the report or commitment may be credited on a subsequent policy charge within the following time period from the date of the report. DISASTER LOANS (CTIC) The charge for a lender's Policy (Standard or Extended coverage) covering the financing or refinancing by an owner of record, within 24 months of the date of a declaration of a disaster area by the government of the United States or the State of California on any land located in said area, which was partially or totally destroyed in the disaster, will be 50% of the appropriate title insurance rate. CHURCHES OR CHARITABLE NON-PROFIT ORGANIZATIONS (CTIC) On properties used as a church or for charitable purposes within the scope of the normal activities of such entities, provided said charge is normally the church's obligation the charge for an owner's policy shall be 50% to 70% of the appropriate title insurance rate, depending on the type of coverage selected. The charge for a lender's policy shall be 40% to 50% of the appropriate title insurance rate, depending on the type of coverage selected. EMPLOYEE RATE (CTC and CTIC) No charge shall be made to employees (including employees on approved retirement) of the Company or its underwritten, subsidiary title companies for policies or escrow services in connection with financing, refinancing, sale or purchase of the employees' bona fide home property. Waiver of such charges is authorized only in connection with those costs which the employee would be obligated to pay, by established custom, as a party to the transaction. CA Discount Notice Effective Date: 1-10-2010 ATTACHMENT ONE CALIFORNIA LAND TITLE ASSOCIATION STANDARD COVERAGE POLICY —1990 EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy and the Company will not pay loss or damage, costs, attorneys' fees or expenses which arise by reason of: 1. (a) Any law, ordinance or governmental regulation (including but not limited to building or zoning laws, ordinances, or regulations) restricting, regulating, prohibiting or relating (i) the occupancy, use, or enjoyment of the land; (ii) the character, dimensions or location of any improvement now or hereafter erected on the land; (iii) a separation in ownership or a change in the dimensions or area of the land or any parcel of which the land is or was a part; or (iv) environmental protection, or the effect of any violation of these laws, ordinances or governmental regulations, except to the extent that a notice of the enforcement thereof or a notice of a defect, lien, or encumbrance resulting from a violation or alleged violation affecting the land has been recorded in the public records at Date of Policy. (b) Any governmental police power not excluded by (a) above, except to the extent that a notice of the exercise thereof or notice of a defect, lien or encumbrance resulting from a violation or alleged violation affecting the land has been recorded in the public records at Date of Policy. 2. Rights of eminent domain unless notice of the exercise thereof has been recorded in the public records at Date of Policy, but not excluding from coverage any taking which has occurred prior to Date of Policy which would be binding on the rights of a purchaser for value without knowledge. 3. Defects, liens, encumbrances, adverse claims or other matters: (a) whether or not recorded in the public records at Date of Policy, but created, suffered, assumed or agreed to by the insured claimant; (b) not known to the Company, not recorded in the public records at Date of Policy, but known to the insured claimant and not disclosed in writing to the Company by the insured claimant prior to the date the insured claimant became an insured under this policy; (c) resulting in no loss or damage to the insured claimant; (d) attaching or created subsequent to Date of Policy; or (e) resulting in loss or damage which would not have been sustained if the insured claimant had paid value for the insured mortgage or for the estate or interest insured by this policy. 4. Unenforceability of the lien of the insured mortgage because of the inability or failure of the insured at Date of Policy, or the inability or failure of any subsequent owner of the indebtedness, to comply with the applicable doing business laws of the state in which the land is situated. 5. Invalidity or unenforceability of the lien of the insured mortgage, or claim thereof, which arises out of the transaction evidenced by the insured mortgage and is based upon usury or any consumer credit protection or truth in lending law. 6. Any claim, which arises out of the transaction vesting in the insured the estate of interest insured by this policy or the transaction creating the interest of the insured lender, by reason of the operation of federal bankruptcy, state insolvency or similar creditors' rights laws. EXCEPTIONS FROM COVERAGE - SCHEDULE B, PART I This policy does not insure against loss or damage (and the Company will not pay costs, attorneys' fees or expenses) which arise by reason of: 1. Taxes or assessments which are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on real property or by the public records. Proceedings by a public agency which may result in taxes or assessments, or notices of such proceedings, whether or not shown by the records of such agency or by the public records. 2. Any facts, rights, interests, or claims which are not shown by the public records but which could be ascertained by an inspection of the land or which may be asserted by persons in possession thereof. 3. Easements, liens or encumbrances, or claims thereof, not shown by the public records. 4. Discrepancies, conflicts in boundary lines, shortage in area, encroachments, or any other facts which a correct survey would disclose, and which are not shown by the public records. 5. (a) Unpatented mining claims; (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c) water rights, claims or title to water, whether or not the matters excepted under (a), (b) or (c) are shown by the public records. 6. Any lien or right to a lien for services, labor or material not shown by the public records. CLTA HOMEOWNER'S POLICY OF TITLE INSURANCE (12-02-13) ALTA HOMEOWNER'S POLICY OF TITLE INSURANCE EXCLUSIONS In addition to the Exceptions in Schedule B, You are not insured against loss, costs, attorneys' fees, and expenses resulting from: 1. Governmental police power, and the existence or violation of those portions of any law or government regulation concerning: a. building; b. zoning; c. land use; d. improvements on the Land; e. land division; and f. environmental protection. This Exclusion does not limit the coverage described in Covered Risk 8.a., 14, 15, 16, 18, 19, 20, 23 or 27. 2. The failure of Your existing structures, or any part of them, to be constructed in accordance with applicable building codes. This Exclusion does not limit the coverage described in Covered Risk 14 or 15. 3. The right to take the Land by condemning it. This Exclusion does not limit the coverage described in Covered Risk 17. 4. Risks: a. that are created, allowed, or agreed to by You, whether or not they are recorded in the Public Records; b. that are Known to You at the Policy Date, but not to Us, unless they are recorded in the Public Records at the Policy Date; Attachment One (6-5-14) CA & NV c. that result in no loss to You; or d. that first occur after the Policy Date - this does not limit the coverage described in Covered Risk 7, 8.e., 25, 26, 27 or 28. 5. Failure to pay value for Your Title. 6. Lack of a right: a. to any land outside the area specifically described and referred to in paragraph 3 of Schedule A; and b. in streets, alleys, or waterways that touch the Land. This Exclusion does not limit the coverage described in Covered Risk 11 or 21. 7. The transfer of the Title to You is invalid as a preferential transfer or as a fraudulent transfer or conveyance under federal bankruptcy, state insolvency, or similar creditors' rights laws. 8. Contamination, explosion, fire, flooding, vibration, fracturing, earthquake, or subsidence. 9. Negligence by a person or an Entity exercising a right to extract or develop minerals, water, or any other substances. LIMITATIONS ON COVERED RISKS Your insurance for the following Covered Risks is limited on the Owner's Coverage Statement as follows: • For Covered Risk 16, 18, 19, and 21 Your Deductible Amount and Our Maximum Dollar Limit of Liability shown in Schedule A. The deductible amounts and maximum dollar limits shown on Schedule A are as follows: Our Maximum Dollar Your Deductible Amount Limit of Liability 1.00% % of Policy Amount Shown in Schedule A or Covered Risk 16: $2,500.00 (whichever is less) $ 10,000.00 1.00% % of Policy Amount Shown in Schedule A or Covered Risk 18: $5,000.00 (whichever is less) $ 25,000.00 1.00% of Policy Amount Shown in Schedule A or Covered Risk 19: $5,000.00 (whichever is less) $ 25,000.00 1.00% of Policy Amount Shown in Schedule A or Covered Risk 21: $2,500.00 (whichever is less) $ 5,000.00 2006 ALTA LOAN POLICY (06-17-06) EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy, and the Company will not pay loss or damage, costs, attorneys' fees, or expenses that arise by reason of: 1. (a) Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to (i) the occupancy, use, or enjoyment of the Land; (ii) the character, dimensions, or location of any improvement erected on the Land; (iii) the subdivision of land; or (iv) environmental protection; or the effect of any violation of these laws, ordinances, or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5. (b) Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 6. 2. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8. 3. Defects, liens, encumbrances, adverse claims, or other matters (a) created, suffered, assumed, or agreed to by the Insured Claimant; (b) not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy; (c) resulting in no loss or damage to the Insured Claimant; (d) attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risk 11, 13 or 14); or (e) resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Insured Mortgage. 4. Unenforceability of the lien of the Insured Mortgage because of the inability or failure of an Insured to comply with applicable doing -business laws of the state where the Land is situated. 5. Invalidity or unenforceability in whole or in part of the lien of the Insured Mortgage that arises out of the transaction evidenced by the Insured Mortgage and is based upon usury or any consumer credit protection or truth -in -lending law. 6. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors' rights laws, that the transaction creating the lien of the Insured Mortgage, is (a) a fraudulent conveyance or fraudulent transfer, or (b) a preferential transfer for any reason not stated in Covered Risk 13(b) of this policy. 7. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching between Date of Policy and the date of recording of the Insured Mortgage in the Public Records. This Exclusion does not modify or limit the coverage provided under Covered Risk 11(b). The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage: EXCEPTIONS FROM COVERAGE (Except as provided in Schedule B - Part II,( t(or T)his policy does not insure against loss or damage, and the Company will not pay costs, attorneys' fees or expenses, that arise by reason of: Attachment One (6-5-14) CA & NV (PART I (The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage: 1. (a) Taxes or assessments that are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on real property or by the Public Records; (b) proceedings by a public agency that may result in taxes or assessments, or notices of such proceedings, whether or not shown by the records of such agency or by the Public Records. 2. Any facts, rights, interests, or claims that are not shown by the Public Records but that could be ascertained by an inspection of the Land or that may be asserted by persons in possession of the Land. 3. Easements, liens or encumbrances, or claims thereof, not shown by the Public Records. 4. Any encroachment, encumbrance, violation, variation, or adverse circumstance affecting the Title that would be disclosed by an accurate and complete land survey of the Land and not shown by the Public Records. 5. (a) Unpatented mining claims; (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c) water rights, claims or title to water, whether or not the matters excepted under (a), (b), or (c) are shown by the Public Records. 6. Any lien or right to a lien for services, labor or material not shown by the Public Records. PART II In addition to the matters set forth in Part I of this Schedule, the Title is subject to the following matters, and the Company insures against loss or damage sustained in the event that they are not subordinate to the lien of the Insured Mortgage:) 2006 ALTA OWNER'S POLICY (06-17-06) EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy, and the Company will not pay loss or damage, costs, attorneys' fees, or expenses that arise by reason of: 1. (a) Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to (i) the occupancy, use, or enjoyment of the Land; (ii) the character, dimensions, or location of any improvement erected on the Land; (iii) the subdivision of land; or (iv) environmental protection; or the effect of any violation of these laws, ordinances, or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5. (b) Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 6. 2. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8. 3. Defects, liens, encumbrances, adverse claims, or other matters (a) created, suffered, assumed, or agreed to by the Insured Claimant; (b) not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy; (c) resulting in no Loss or damage to the Insured Claimant; (d) attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risk 9 and 10); or (e) resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Title. 4. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors' rights laws, that the transaction vesting the Title as shown in Schedule A, is (a) a fraudulent conveyance or fraudulent transfer; or (b) a preferential transfer for any reason not stated in Covered Risk 9 of this policy. 5. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching between Date of Policy and the date of recording of the deed or other instrument of transfer in the Public Records that vests Title as shown in Schedule A. The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage: EXCEPTIONS FROM COVERAGE This policy does not insure against loss or damage, and the Company will not pay costs, attorneys' fees or expenses, that arise by reason of: (The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage: 1. (a) Taxes or assessments that are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on real property or by the Public Records; (b) proceedings by a public agency that may result in taxes or assessments, or notices of such proceedings, whether or not shown by the records of such agency or by the Public Records. 2. Any facts, rights, interests, or claims that are not shown in the Public Records but that could be ascertained by an inspection of the Land or that may be asserted by persons in possession of the Land. 3. Easements, liens or encumbrances, or claims thereof, not shown by the Public Records. 4. Any encroachment, encumbrance, violation, variation, or adverse circumstance affecting the Title that would be disclosed by an accurate and complete land survey of the Land and that are not shown by the Public Records. 5. (a) Unpatented mining claims; (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c) water rights, claims or title to water, whether or not the matters excepted under (a), (b), or (c) are shown by the Public Records. 6. Any lien or right to a lien for services, labor or material not shown by the Public Records. 7. (Variable exceptions such as taxes, easements, CC&R's, etc. shown here.) Attachment One (6-5-14) CA & NV ALTA EXPANDED COVERAGE RESIDENTIAL LOAN POLICY (12-02-13) EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy and the Company will not pay loss or damage, costs, attorneys' fees or expenses which arise by reason of: 1. (a) Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to (i) the occupancy, use, or enjoyment of the Land; (ii) the character, dimensions, or location of any improvement erected on the Land; (iii) the subdivision of land; or (iv) environmental protection; or the effect of any violation of these laws, ordinances, or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5, 6, 13(c), 13(d), 14 or 16. (b) Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 5, 6, 13(c), 13(d), 14 or 16. 2. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8. 3. Defects, liens, encumbrances, adverse claims, or other matters (a) created, suffered, assumed, or agreed to by the Insured Claimant; (b) not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy; (c) resulting in no loss or damage to the Insured Claimant; (d) attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risk 11, 16, 17, 18, 19, 20, 21, 22, 23, 24, 27 or 28); or (e) resulting in Toss or damage that would not have been sustained if the Insured Claimant had paid value for the Insured Mortgage. 4. Unenforceability of the lien of the Insured Mortgage because of the inability or failure of an Insured to comply with applicable doing -business laws of the state where the Land is situated. 5. Invalidity or unenforceability in whole or in part of the lien of the Insured Mortgage that arises out of the transaction evidenced by the Insured Mortgage and is based upon usury, or any consumer credit protection or truth -in -lending law. This Exclusion does not modify or limit the coverage provided in Covered Risk 26. 6. Any claim of invalidity, unenforceability or lack of priority of the lien of the Insured Mortgage as to Advances or modifications made after the Insured has Knowledge that the vestee shown in Schedule A is no longer the owner of the estate or interest covered by this policy. This Exclusion does not modify or limit the coverage provided in Covered Risk 11. 7. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching subsequent to Date of Policy. This Exclusion does not modify or limit the coverage provided in Covered Risk 11(b) or 25. 8. The failure of the residential structure, or any portion of it, to have been constructed before, on or after Date of Policy in accordance with applicable building codes. This Exclusion does not modify or limit the coverage provided in Covdred Risk 5 or 6. 9. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors' rights laws, that the transaction creating the lien of the Insured Mortgage, is (a) a fraudulent conveyance or fraudulent transfer, or (b) a preferential transfer for any reason not stated in Covered Risk 27(b) of this policy. 10. Contamination, explosion, fire, flooding, vibration, fracturing, earthquake, or subsidence. 11. Negligence by a person or an Entity exercising a right to extract or develop minerals, water, or any other substances. Attachment One (6-5-14) CA & NV e-oss vas o0a WV SOS elo7Jbl/8:Pelupd 'uosuenelt r:Ae pelsenbea 1 Pu 1 eBed 960L8 ueP10 ooewyi unsays slepew 191110 10 e5eaioe'sluewesee )o uopeool'seoueptp'suopuewsu emsui lou seep Auedwo0 Ka 'Sue p yuaweswpue Aa pelypow Alsseidze M eauelnSw eup 10 Aolod a 1001va aul of ldeoxg pel0Wep puel ay1)0 Aen100 a lou a pue'puel Jew pue sepeponoq 'mpw 'sleeps Bulololpe of uopepl ul pue4 pepuosep ula1ay au) Bupeaol ul pre ue se payswm) 600q s lela/dew s�yl 560-0F,-09e 0 Q) 4,4 Zal ggs yy44 O n (0-0 �to A ro �— O x )o O rm o a y P• n co O -o 0 om c> mN 0 -n B AVE.t G m r 01@ AVE t IIIII�" I aI > 1 1411 I I a FIRE STATION Imo- . D AVE co to 1 r cp ) `ro v W 0 U1 O I 0 R. OF S. NO. 157H )� STREET CALCD (N7217536E 1324.45) (99134) 572E35'481W 1324.52' 993.39' CALM (99154') 99173' 1 /`,, R /6 PT 127897 B6.54' (C81D) 4286.44 i��NOJ /4 N 1132128613 � - _ N 49• 17 56' 78240 0.73 / E 6298041.27 - - N 824T1236 E 6301309.81 EL-66.03' NOVD.29 552137'10E 46.18' A A T h 15THTa-OEIED.1 STREET 331.13' (33I.II ) 10.00' - N72E75'38E 115.57' LJ E3 i- 20.00' 251.13' II5.56' h 14556 30' 10.00' qp 77556. r N72176.37 E /A.'"-------NI670.331E 4590' 16711N72126'31 E 1324.53' (N72196'37 E 1324.597 STREET ET ioo/s .4, LJ� .i 115.55' (331.047 331.10 261.11' 20.00' I I 40' 3' 0/S, FYMrsRATED FCR CLARITY 40' .4< MONUMENT NOTES ci 25' BASS CISC re x PUNCH PER ROS 15443 AND NA TRAW4L CITY DOG Na 4544-0 2� 25' BRASS DISC NTH PUNCH RCE 8195 PER ROS 15443 3' BRASS DISC MM PUNCH 7977 PER ROS 15443 AND NAIRWAL CITY DMG NO.. 4544-D a LEAD AND TAG LS 4593 PER CR 26085 LEAD AND TAG SAN RCE 19073 Li LEAD AND TAG S7 CITY ENG CONPERGISYCE AN5E AT PT. 1236 =-O'27'516181 LEGEND • INDICATES raw 4104010Yr A5 NOTED. o INDICATES SET J/4' I.P. MM PLUG STAMPED 1S 47681 O INDICATES SET LEAD AND TAG MOH DISC STAMPED 1S 47681 () RECORD PER RECORD OF SURVEY 15443 GRAPHIC SCALE O' 50' 100' rso' zoo' SCALE: 7 50' PLAZA C 4 16TH SIREET VICINITY MAP NOT 70 COIF S- EET 1 OF 1 SHEETS RECORD OF SURVEY A PORTIW CF BLOC% 4, NITIONIL RAN01, ACCORDING TO YAP 1NERELF ND. 552, FILED JILY 2, 1889 IN TIE OFFICE 0' TIE COMFY RECOOOER CF SIN DIEGO COWL IN TIE CITY OF NATIONAL CITY, COWIY OF SAN DIEGO, STATE OF CALIFORNIA. BASIS OF BEARINGS TIE BASIS OF 4ARI7L5 FOR THIS SI.RVL7 IS A CALCLIATED LAN: 9E11EEH POINT 1278 NO 1238, PER ROS 14492, I.E. NORM 49'12'56' EAST. SAID POINTS/C00RDINAIES ARE REFERENCED TO 1FE NW1H AIERICAN DADA OF 1983 (RAD 83) AA0 ARE D6ESE D IN TERMS OF TIE CALIFORNIA COCRD1N1TE SYSTEM 1F 1963, ZQE VI (CCS 83), E'OO1 1991.35, U.S. SIALVEY FEET. MESS 0TNROISE 99111, DISTANCES SHOW 1ETEON ARE G811.*O. TO OBTAIN CRUD DISTANCES, IA.L1IPLY (AM) DISTANCES BY 1.O000233 (071131160 SCALE FACTOR). SURVEYOR'S STATEMENT THIS MAP CORRECTLY REPRESNTS A SURVEY MADE BY ME OR UNDER MY DIRECII W AV CONFORMANCE NMTH ENE REQUIREMENTS OF THE PROFESSIONAL LAND SURVEYOR'S ACE AT THE RE0IEST OF THE CITY OF NA DOVAL CITY IN 0CTDETOZ 20111 PETER C GOIA'NG LS 4768 COUNTY SURVEYOR'S STATEMENT THIS MAP HAS BEEN &AWED IN ACCORDANCE WM SECTION 8766 OF THE WW;;' LAID SURVEYOR'S ACT DNS_DAY OF RAYMOWO L MADE PLS 6185 COUNTY SURVEYOR RECORDER'S STATEMENT FILE NO. FEED THIS DAY OF 2018 AT O'CLOCK _.M. IN BOOK OF RECORD Cr SURVEY MAPS AT PACE AT ME ,REQUEST OF PETER C GLEORG ERNEST 4 OPWEYBORG A. COUNTY RECORDER FEE $ 9.00 Br DEPUTY COUNTY RECORDER NV5 CALIF. COORD RDE2 184-1737 N7217674 E 145.56' (STREET CLOSED) STREET N72'05'48'1- 261. 7J' . (STREET CLOSED) 10' OjS ORS, EXAGGERATED FGR C1AR ITT R cr SMOS 0.E0MM. RIC RP. MIN HiN LEGAL DESCRIPTION L015 110 6 MUSK NO LOIS 11 AD 00 IICLI0ILL 1B BLOCK A CC 10 AME Lai 6 Ix 0001@ SERION 154 O DE WOO It LE NL101, IN DE CITY O W11.1 CITY, COWIY O Sw DIEM. 51.R O CALIFORNIA, ACMBDI. 10 WP K. M. 502. FILED IN M ORICE O M C.11 IEmOEA 0 5. DIEM COMIY, LILY 2, tm. 101EII061M MU MITI. O 1N WON NU R OM 51.1..W.111 10 MR 1 . 2. V . M0 NO ¢® 10 PHIC . BY N30LD11O1 NO. 6516 OF TE C111 K .IIOOI CITY. A COO IM COPY .0.11.01 2. 1556 IN DOM .0, P. 500 CC OFFICIAL 1.0116. ..0 RIM. BIM 1M WIRY N MEI O C A10. MAWS( 10 LOIS 1 DIM. 5 MLSIK, YACA. NO .120 M PISA . RT N13LOYIM.. 6150 O THE CITY 0 NAIIOW CITY. A OBIIf IM NF 0.0.5.0. 5. 1055 Ix BMX BAIL P. 413 OFFICIAL RCM. ALSO 10¢T. 11111 MO PORTION 0 TIE SCOW IYIF O 15111 506L1 NSNENI M MR 1 NO 20 NO M AL1F1 LYI4L 001QN LOR 1 510016 1NL6I1C A. MIS 15 T010120 11.16111.4 0® K➢ 10 MALL LSF BY l01101 OS 'MONA OF Of CITY III ICNL CITY. A CITIFIED DPI' NCO.O ILNM M. 2004 AS FILL 10. Z101-029.5 OFICIAL RECORDS. SURVEYOR'S NOTE a DEMIST. MM.. 0041063 1. Sri LIRE oars Ocots ROOM mar F Rr SOO.10.111. Raw, LEGEND • W.1e.1 K'S FOND 110141111214 AS 0 01C0. 0 5Lr /P. NM1E 4•ANL SWIM) is 47607 ❑ BOLARS 44 (1100 N50 RAC •IN OSC SIMKO 1.5 47687 CERTIFICATION I SWIM TNT Mrs Br V.5 P OW° BY If a AMER • DIMC11XM NO 15 L.D w A FI00 9AK1 IM COMB... BIM M KOJI1Elfl. O TE LN0 9N1000.5 AC1 NO LOLL 0001N.S. 1510E .1 ALL ...IS NE K M OBBALIG ANO ¢M5 IRE POSIII. MICA. 120 .1 1N I114.N15 NE OEFICIENI 10 (MALL IRE SAKI T1 • •1RAO0. IEIOF C 00LE1C LS 4760 Epic Land Solutions, Inc. APPRAISAL REPORT Fire Station 34 ADDRESS: APN: DATE OF REPORT: DATE OF VALUE: EPIC PROJECT CODE: 343 E. 16th Street, National City, CA 91950 560-092-08 October 17, 2018 October 2, 2018 EA-18052 Prepared For: Gregory Rose, Property Agent City of National City 140 E. 121h Street, Suite B National City, CA, 91950 Prepared By: Epic Land Solutions, Inc. Appraisal Group 16496 Bernardo Center Drive, Suite 207 San Diego, CA 92128 Epic Land Solutions, Inc./ 16496 Bernardo Center Drive, Suite 207 San Diego, CA 92128 Ph: 619-573-6048 October 17, 2018 Gregory Rose, Property Agent City of National City 140 E. 12th Street, Suite B National City, CA 91950 Telephone: (619) 336-4266 Email: prose c(D,nationalcityca.gov Re: Fire Station 34 343 E. 16th Street National City, CA 91950 APN 560-092-08 Project Code: EA-18052 Dear Mr. Rose, At your request and authorization, I have prepared an appraisal report of the market value for the above referenced real property. I have provided the market value of the subject's fee simple estate on an "as is" basis. Data, information, and calculations leading to the value conclusion are incorporated in the report following this letter. The report, in its entirety, including all assumptions and limiting conditions, is an integral part of, and inseparable from, this letter. Your attention is directed to the Addenda which contains the assumptions and limiting conditions. The following appraisal sets forth the most pertinent data gathered, the techniques employed, and the reasoning leading to the opinion of value. The analyses, opinions and conclusions were developed, and this report has been prepared, in conformance with the Uniform Standards of Professional Appraisal Practice (USPAP) and the Code of Professional Ethics of the Appraisal Institute. The appraisal has been completed subject to the Assumptions & Limiting Conditions contained within the report. Extraordinary Assumptions and Hypothetical Conditions, if any, may have an impact on the assignment results. By virtue of my experience and based upon my investigation, it is my opinion that the market value of the subject as of October 2, 2018 is: $5,300,000 Epic Land Solutions, Inc. Page jii Please refer to the attached appraisal report, plus exhibits, for a summary of the supporting documentation of the value estimate contained herein. Respectfully submitted, Kent J. Carpenter, MAI Certified General Real Estate Appraiser Senior Appraiser Epic Land Solutions, Inc. California License AG003087 Epic Land Solutions, Inc., Page 'Hi Table of Contents Table of Contents 1 Introduction 2 Executive Summary 2 Overview of Appraisal 3 Area Description 5 Subject Property and Project Description 6 Aerial View of Subject Property 6 Subject Property Photographs 7 Site Description 19 Plat Map 21 Improvements Description 22 Floor Plans 23 General Plan Land Use & Zoning 30 Valuation Analysis 33 Highest and Best Use 33 Appraisal Procedures Followed, Methodologies 34 Sales Comparison Approach 34 Comparable Sales Summary 35 Market Data Map 35 Market Data Description 36 Adjustment Considerations 37 Value Conclusion 37 Cost Approach 38 Certification 43 Improved Sale Comparables 44 Land Sale Comparables 48 Addenda 55 Assumptions and Limiting Conditions 55 Background and Qualifications 57 Epic Land Solutions, Inc., Page 11 Introduction Executive Summary Property Reference: EA-18052 Property Address: 343 E 16th Street, National City, CA 91950 APN(s): 560-092-08 Property Type: Special Purpose (Fire Station) Report Format: Narrative Date of Appraisal Report: October 17, 2018 Date of Value: October 2, 2018 Date of Site Inspection: October 2, 2018 Real Estate Interest Appraised: Fee Simple Function of the Appraisal: Lender Requirements Location: The subject is located at the northwest corner of E. 16th Street and D Avenue in the city of National City, CA Improvements Description: Fire Station Site Description: The site is a corner lot with good access and exposure and is irregular in shape. The site has frontage on both E. 16th Street and D Avenue and contains 60,984 square feet. Highest and Best Use For this type of special purpose property, the highest and best use of the property "as -improved", is stipulated to be continued use of the property as a fire station. Concluded Market Value: $5,300,000 Extraordinary Assumptions and Hypothetical Conditions: 1. The value is of the real estate only and assumes continued use of the property as a viable fire station. No value is given to any specialized furniture, fixtures or equipment that would be necessary to operate a fire station. Epic Land Solutions, Inc., Page 12 Overview of Appraisal Purpose of Appraisal The purpose of this appraisal is to estimate the Market Value of the subject property as defined. Intended User The intended user of this appraisal report is the client, Mr. Gregory Rose with the city of National City. There are no other intended users. Anyone else using or relying on this appraisal is considered an unintended user and no fiduciary obligation is owed by the appraiser to that party Intended Use The intended use of this appraisal report is to satisfy valuation requirements imposed by the lender. The appraisal cannot be used for other purposes such as collateral for bond funding, appealing taxes, submission to Superior Court for condemnation, etc. Definition of Market Value The purpose of this report is to render an opinion of current Market Value of the leased fee interest in the subject property. Market Value, as used in this report, is defined as follows: The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: 1. Buyer and seller are typically motivated; 2. Both parties are well informed or well advised, and acting in what they consider their own best interests; 3. A reasonable time is allowed for exposure in the open market 4. Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and 5. The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale' Special -Purpose Property (6th Edition — Dictionary of RE Appraisal) A property with a unique physical design, special construction materials, or a layout that particularly adapts its utility to the use for which it was built; also called a special -design property. 1 12 C.F.R. Part 34.42(g); 55 Federal Register 34696, August 24, 1990, as amended at 57 Federal Register 12202, April 9, 1992; 59 Federal Register 29499, June 7, 1994 Epic Land Solutions, Inc., Page 13 Date of the Appraisal The effective date of value is October 2, 2018. This date coincides with the date of inspection of the property. The date of this appraisal report is October 17, 2018. Owner of Record & Property History According to submitted title report, title to the subject property is vested in City of National City, a Municipal corporation. As a special purpose property serving the needs of the community, the sale of the property has not been entertained, nor is the future sale of the property as a fire station a likelihood. The property was constructed in 2005 and replaced the older fire station that existed on the site which has been owned by the city of National City for many years. Scope of Work In order to complete this assignment, I identified all assignment conditions; determined an appropriate scope of work; collected general and specific data on the district, neighborhood, market area, subject property and comparable properties; analyzed the data gathered; applied the appropriate approaches to value; and reconciled all indications of value into a final value estimate. My investigation, value opinion and analyses comply with the Uniform Standards of Professional Appraisal Practice and is unbiased and impartial. No predetermined value or opinion formed the basis of any conclusions stated in this appraisal. The depth of the investigation and analysis is meant to be in keeping with the purpose and intended use of the appraisal. Epic Land Solutions, Inc. Page 14 Area Description The subject is in National City, which is the second oldest city in the county. Incorporated in 1887, National City has a population of about 60,000. The city is eight miles south of the San Diego's central business district. National City has a large industrial base and has long been the center of maritime industrial activity within the county. The 24th Street Terminal has added significantly to the area as a whole by increasing the ability to handle maritime ocean freight activity. The community is serviced by Interstates 5 and 805 which extend through the east and west portions of the city. State Route 54 forms the city's southerly boundary, extending east/west along the Sweetwater River. Public transportation is provided by a local bus system and the San Diego Trolley, giving access north to San Diego and south to the Mexican Border. Commercial development is concentrated along the city's major arterials including National City Boulevard, Highland and 24th Street. A significant portion of the area's tax base is supported by the National City Mile of Cars located along National City Boulevard, extending from 18th Street to 31 st Street at SR 54. This is one of six main auto mall locations within the county. There are numerous automobile franchises represented on the Mile of Cars, with all major brands being sold there. National City has a diverse economic base that is linked to the South Bay economy and the regional economy as a whole. Paradise Valley Hospital and National City School District are the two largest employers in the city. The City has an employment base of approximately 25,000 persons, with the largest industries being retail trade, services and military. Downtown Specific Plan The subject property is located within the boundaries of the downtown specific plan, a long-term plan to pursue the full potential of National City's central business district through land use designations. The plan amends the adopted General Plan by affixing precise design and land use standards to development and redevelopment proposals within downtown National City. The plan also provides a complete analysis of downtown as well as a series of recommendations that addresses identified issues and potential opportunities. Within the plan are 17 development zones which designate densities, maximum and minimum floor area ratios, maximum building heights, and preferred land uses within the respective zones. Epic Land Solutions, Inc.1 Page 15 Subject Property and Project Description Aerial View of Subject Property Location of subject property is approximate. Epic Land Solutions, Inc/ Page 16 Subject Property Photographs Photoaranh 1 Viewing subject property from E. 16th Street Photo •ra•h 2 Viewing apparatus room and truck egress from D Avenue Epic Land Solutions, Inc. Page 17 Looking west at maintenance building and access to training tower from D Avenue Photoaraoh 4 Looking north along D Avenue with subject property at left Epic Land Solutions, Inc.` Page 18 Photoaraph 5 Viewing training tower from outdoor patio area Photograph 6 Viewing site improvements (walls, landscape walkways) from outdoor patio area Epic Land Solutions, Inc.% Page 19 North elevation of fire house Looking west otoutdoor patio area Epic Land Solutions, K~~-e Paa.e |1O Photograph 9 Looking west at canopied parking area and ingress to property from C Avenue Looking east at apparatus room drive in Epic Land Solutions, Inc., Page 111 Photograph 11 Apparatus room trom mezzanine Photograph 12 Typical Bunk Koom Epic Land Solutions, Inc., Pa' 12 Photograph 13 Captains office near main entry of building Photograph 14 Viewing full service kitchen Epic Land Solutions, Inc./ Page I13 Photograph 15 Dining Room and exit to patio area adjacent to kitchen Photograph 16 Hallway off dining room Epic Land Solutions, Inc./ Page I14 Photograph 17 Day Room Photograph 18 Training/Community Room Epic Land Solutions, Inc/ Page 115 Photograph 19 Fitness Room Photograph 20 Display Room (Museum) on south end of 1st Floor Epic Land Solutions, Inc. 16 Photograph 21 Work-out area on mezzanine Photograph 22 Fire Pole Escape from Mezzanine Epic Land Solutions, Inc. Page 117 Photograph 23 Typical Storage Room onsouth side nf Apparatus Room Photograph 24 Turnout Room on 1 It Floor adjacent Apparatus Room Epic Land Solutions, Inc.#,**, Pa-e )18 Site Description General Site Information Address: Legal Description: Current Owner(s): 5 Year Sales History: Zoning: Assessor Parcel Number(s): Assessed Value Land: Assessed Value Improvements: Total Assessed Value: Taxable Value: Taxes: Northwest corner of E. 16th Street & D Avenue in the city of National City, CA 91950. The street address is 343 E. 16th Street, National City, CA 91950. LOTS 1 TO 6 INCLUSIVE AND LOTS 11 TO 20 INCLUSIVE IN BLOCK 4 OF 10 ACRE LOT 8 IN QUARTER SECTION 154 OF THE RANCHO DE LE NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 552, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JULY 2, 1888. TOGETHER WITH THOSE PORTIONS OF THE SOUTH HALF OF 15TH STREET, ADJACENT TO LOTS 1 ABD 20, VACATED AND CLOSED TO PUBLIC USE BY RESOLUTION NO. 6576 OF THE CITY OF NATIONAL CITY, A CERTIFIED COPY RECORDED MARCH 2, 1956 IN BOOK 5999, PAGE 508 OF OFFICIAL RECORDS. ALSO TOGETHER WITH THE EASTERLY 10 FEET OF C AVENUE ADJACENT TO LOTS 1 THROUGH 6 INCLUSIVE, VACATED AND CLOSED TO PUBLIC USE BY RESOLUTION NO. 6759 OF THE CITY OF NATIONAL CITY, A CERTIFIED COPY RECORDED OCTOBER 5, 1956 IN BOOK 6287, PAGE 413 OFFICIAL RECORDS. ALSO TOGETHER WITH THAT PORTION OF THE SOUTH HALF OF 15TH STREET ADJACENT TO LOTS 1 AND 20 AND THE ALLEY LYING BETWEEN LOTS 1 THROUGH 6 INCLUSIVE AND LOTS 15 THROUGH 20 INCLUSIVE VACATED AND CLOSED TO PUBLIC USE BY RESOLUTION NO. 2004-44 OF THE CITY OF NATIONAL CITY, A CERTIFIED COPY RECORDED MARCH 29, 2004 AS FILE NO. 2004-0257565 OFFICIAL RECORDS, The property has not sold within the past 5 years. Downtown Specific Plan (Zone 16) 560-092-08 $0 $0 $0 $0 $0 Epic Land Solutions, Inc., Page I 19 Physical Characteristics Total Site Area: Site Dimensions: Frontage: Shape: Topography: Access: Corner Influence: Easements: Encroachments: Utilities to Site: Sidewalk, Curbs and Gutters: Flood Designation: Surface Drainage: Environmental/Soils: Subsurface Conditions: Improvements: of the Site 60,984 square feet Multiple dimensions - L-shaped parcel 290 feet on C and D Avenue; 11 feet on E. 16th Street L-Shaped Level C Avenue, E. 16th Street, D Avenue Yes Submitted title report shows typical utility easements encumber the property. No onerous easements, encroachments or restriction impact the property. None noted with appraisal assuming none exist. All utilities in adjoining roads & connected Installed along all three streets Zone X (Map 060293 — 06073C1911G) dated 5/16/12) indicating minimal flood hazard in area outside of 100 and 500-year floodplains. Adequate There was nothing discovered which would indicate there are environmental issues associated with the subject property. The appraiser is not qualified to detect hazardous waste and/or toxic materials. Any comment by the appraiser that might suggest the possibility of the presence of such substances should not be taken as confirmation of the presence of hazardous waste and/or toxic materials. Such determination would require investigation by a qualified expert in the field of environmental concerns. The presence of substances such as asbestos, urea -formaldehyde foam insulation or other potentially hazardous material may affect the value of the subject property. The value estimate is predicated on the assumption that there is no such material on or in the property that would cause a loss in value. No responsibility is assumed for any environmental conditions, or for any expertise or engineering knowledge required to discover them. Descriptions and comments are the result of routine observations made during the appraisal process. This appraisal is based on the assumption that there are no unusual soils problems associated with the property and that load bearing capacity and drainage are adequate. No soils report was provided. Unknown Fire Station & Training Tower Epic Land Solutions, Inc.1 Page I20 Plat Map Following is a plat map showing the size, shape and location of the subject land. v J 0 AO V N ST i CLO MC. CO Kil MBALL 1._1 : PARK ,e a ,8 CD ~ D.a9 AC. a---49 / ir�' 5 I— CD' 6 7 to 3 091 ..r Als1D" 1BId. r 15 T H ST ST CLSD -1So a CLS�� ~ 2 di_ 3 : 118 4 I:11 5-1w'1- 6 15 9 -1SFE OETA) L 1.40 AC 092 0 Al 4 ST 4 f Epic Land Solutions, Inc. Page I21 Improvements Description The building improvements consist of a Headquarter Firehouse constructed in 2005. Per plans on the following pages, the improvements contain 19,440 square feet, with the calculations for the 4-story training tower indicating 11,520 cubic feet. Fire Station 34 The "New" Station 34 was completed in 2005. This Headquarters station replaced the previous Station 34, which was built in 1954. Station 34 is located at 16th and "D" Ave, next to Kimball Park. The station houses Engine 34, Truck 34, Battalion 57, Rescue 34 and two reserve apparatus. The station itself consists of over 19,000 square feet and four apparatus bays. Also at this site is a state of the art training tower and drill yard. The station has a community room and a separate history showroom for R-1, our completely restored 1925 Seagrave Fire Engine. Inside the station are all the modern-day amenities one might expect to see in a Fire Station today. Each Firefighter, Engineer and Captain on duty has their own rooms upstairs, complete with brass fire pole. Additionally, there are two separate workout areas with new fitness equipment, a large day room with leather recliners, a Plasma TV, and a full kitchen. The outdoor patio has a built in BBQ. The 4 story -training tower was the first of its kind in San Diego County. It includes a propane live burn room, ventilation prop, search and rescue props with zero visibility capabilities, a "Denver" prop, forcible entry props on the doors and numerous repelling stations throughout. The drill yard has its own water pump and tank with a complete runoff recovery system. A review of the plans shows the following details about the layout: • The main pedestrian entry into the station is off D Avenue. • The first floor is separated into a north and south side by the apparatus room where the trucks, engine and other emergency vehicles are parked. The north side of the station has administrative offices, two captain's offices, platoon commander office and bunk room, full kitchen and dining room, a day room, two medic bunk rooms and restrooms, a library, report writing rooms, a fitness room, two sets of stairways, an elevator, and restrooms. Also, on the north side with access from the apparatus room only is the turnout room where the fire fighters keep their gear. Off the dining room is an outdoor patio area with built in barbeque, landscape, concrete block/wrought iron fencing, and pedestrian exit to a solar panel canopied parking area and training tower, located in the parcel's west and northwest area. • The south side of the station on the first floor contains several storage rooms, a clean room, a community/training room, a kitchenette, men's & women's restroom, and a display (museum) room. • The apparatus room is accessed from C Avenue with egress onto D Avenue. • The 2nd floor is improved with six bunk rooms, two captains bunk rooms with restrooms, three restrooms, and a mezzanine used for workout area and firepole escape. • Separate from the fire house and having its own separate gate guarded ingress/egress off D Avenue is a truck maintenance building of metal construction. Epic Land Solutions, Inc., Page I22 Floor Plans Fire Station t NATIONAL Gfl OWARTIVNNT HIAXICILIARTIERS STATION 34 KV 0 • Gana 7-Zezzregiam Proem, Yam M ----..— n� Upropoo awn m sw .14 Epic Land Solutions, Inc. Page 123 tzi a 0 0 0 •.rnlwln•+T o*n nor tl oralivnb{+vDfi /uaitrix7aQ >+ I a ;bill gun frumpyNT 1 0. 9 g-1 • I I . .. ° a+•ta taa• ' i 11 1111111 titi i s.sssas ld 1111 m faat}l;aaawa hil $ tItitliliiiell $ �$ ffBB111 aaaaaf Ear 0 4 .. t a a... a a #Ii a i a a f u • 11/ s t 1 a t f°{lllil3ia1:t 1! 11 1 $$ 11 111 111/111 14� a s k} 41 CI 1I,1111$11i1l a a ir$ a i a a i$$3i 1 1 . p a a t a a a a. a a a a a. f s i a i 0-- 0-- el Training Tower UPI&M MY —� 11h1W .0111011. pxLr(Y ,61 Mar '�X CDU 00011'1111 EAST SGE WALL ELEVATION MAIL I/4 - 1 MINIM -- red* sot .. r,Yeu groin, aut rIW ! 1 011.10 {1lIG34 .9rt who okut mot* Epic Land Solutions, Inc., Page I 26 'u- Y.4%21 030330 11"..++41 Marla • W'4. pAw:: -ram sou04 ontrie owe WNW* Wm /Lo+m 1I1Y �LCl LTYc7OML Drab' Pw(L */ •+whoa. CMM/.c. Pa+vo. •''w4C. CNWi(7 +0 u.w.snl a .aen wWE COP"EI Wu 01.6106C INS(( LMIi* d e1.KD1YG NOM .o' S1EP tfr Ow BEhKCY KpCi WAY .WA !PE MAP( VAL id /11)•A9 /bt220 ♦ � � %+G fI • COMM TIN h"J477D \ xL PMIE /�yifp M —. Aiwww *i (i 'VL;! 1![ CAT 1:0IICC16w NORTH END ELEVA T7ON MAUL 1/4" w 1' RV*. Epic Land Solutions, Inc. P age I 27 PMMtT 7M.4 IIPY — 0.hfJ1' MM J3E07 tn. JI_ weal, fT w! $1 IOW' U' al A WSW it —� MI S11 .{)GI.F IY INt. AL 11L04 it — Nr J. 41,241 +T X P '11 �W 0104. M >,1 rt Ida KI�1 y7 I :ma xi.= w; pem. s1111 lre a 6fc0 CUT Mco.c Tlim T D IC' LENGTHS OF rtaieS P9 REOLAREJ OC'ATE FRAMED OPENING'', NOTE ALIEFC4ATE 81D SDI FLOOM NOT 91gN1 Illllll�llllllf- MILL INw 1131131.0 as fN 1CO h+ Ow OO MY IbP I! IP' 1MFl •A IOIr 11101CT ! EA%Tu N1uN0 C EIMER +111( •3W3.1 r. T z _ 1 . .C. ---1 SCALE: T`4• . WEST s!OE WALL ELEVA Pop,* _ ti 4E1P41$.I., -'}IL anLL Form 1* .14W0 d'r7P[ Kesc'rr Epic Land Solutions, Incl.' Page 128 ,K a.10. ..`!nn.+. r ,..Elva iuyt/t 0,00( MK> rra[ E`Srlor art. • M..r.c; WOOL. SOU TH ENO ELE VA TION •A.ar tea.. rsorato f - .or ie.. I3117': SCALE: 1 /4 .— 1' APPRC? mum ? R t"a Training Tower Floor 1 la 2 3 4 Length (ft) 12 12 24 18 12 Width (ft) 16 12 16 16 12 Height (sf) 10 10 10 10 10 Cu Ft 1,920 1,440 3,840 2,880 1,440 Totals 11,520 Epic Land Solutions, Inc, Page I29 General Plan Land Use & Zoning The zoning characteristics for the subject oropertv are summarized below: Zoning Summary Current Zoning: Downtown Specific Plan (Zone 16 — Civic Center) Permitted Uses: Institutional Zone Uses (see below) Zoning Change: Not likely Development Standards Minimum Lot Size: 5,000 square feet Minimum Setbacks: Front: 10 feet Rear: 0 feet Side: 5 feet Maximum Building Height: 65 feet or 5 stories FAR 3.0 The purpose of the Institutional (I) zone is to provide for a wide range of institutional and accessory uses including public, quasi -public, and private facilities that address health, safety, educational, cultural, and welfare needs of the community and neighborhoods. Allowed uses include educational facilities, government offices and courts, community centers, libraries, museums and cultural centers, hospitals and medical centers, retirement communities, public safety facilities (i.e., fire and police stations), neighborhood gardens and community farms, public utilities, and similar uses. Zoning Map Epic Land Solutions, Inc./ Page I30 Downtown Specific Plan 1 Refer to tine Downtown 5pec,fic Plan Apptic obbe Oevelopn+cnt Zone Downtown Specific Plan Map Epic Land Solutions, Inc. I 31 Legend E 1 Development one D Downtown Specific Plan Ares 9T1- ST 7 11TH ST a 2p� 1TTH ST CIVIC CENTER DR KIN ST tSTH ST Ls; u 16TN ST 17T-I ST w 1ri T•I it r 1a 6 2 3 DIVISION ST 1ST ST N L1 ) I 3RD ST 4TH ST VfI ST LIFI 4 W 8 9 9TH 51 11 1 PLAZA �3CJC so 12a 16 / 1S 14 sa I ITH ST V Epic Land Solutions, Inc.` 32 Valuation Analysis Highest and Best Use The highest and best use of any property depends upon the physical and legal restrictions imposed by the size, shape, location and zoning of the site, and the size, siting, quality and condition of the improvements. An improved site like the subject property would be analyzed for its highest and best use on both an "as though vacant" and "as -improved" basis. Considerations under each of these analyses will include uses that are (1) physically possible, (2) legally permissible, (3) financially feasible, and (4) maximally productive. For this special purpose property, the significance of the "as though vacant" analysis lies in the selection of land sales to be used in the Cost Approach. As Though Vacant Physically Possible - The subject property is of sufficient size and shape to be a developable site. It is generally level at street grade, has utility connections immediately available, and has access from and frontage on three streets. This L-shaped parcel is larger in size than most other parcels in the neighborhood and would provide lots of development opportunities. Legally Permissible - The subject is designated Civic Center in the downtown Specific Plan. The Specific Plan states that uses allowed within this zone are those allowed under the Institutional zone. The purpose of the Institutional (I) zone is to provide for a wide range of institutional and accessory uses including public, quasi -public, and private facilities that address health, safety, educational, cultural, and welfare needs of the community and neighborhoods. Allowed uses include educational facilities, government offices and courts, community centers, libraries, museums and cultural centers, hospitals and medical centers, retirement communities, public safety facilities (i.e., fire and police stations), neighborhood gardens and community farms, public utilities, and similar uses. Financially Feasible — The surrounding uses, size and access to and from the property would render development of a variety of uses possible. However, based primarily on land use patterns and redevelopment in the area, the maximally productive use of the site would be for development of the property with some form of institutional use that would complement the existing uses in and around Kimball Park and the existing city offices. These uses would most likely be educational facilities, government offices and courts, community centers, libraries, museums and cultural centers. Maximally Productive — Considering the legally permissible, physically possible and financially feasible uses in the current market, the highest and best use is for some form of public use such as educational facilities, government offices and courts, community centers, libraries, museums and cultural centers. As Improved As a viable "special-purpose" property currently being operated as a fire station, the highest and best use is concluded to be for continued use as a fire station. Epic Land Solutions, Inc., Page I 33 Appraisal Procedures Followed, Methodologies For the appraisal of the subject property, both the sales comparison approach and a cost approach are applicable approaches to value. As the improvements are considered "special purpose" in nature and would never trade on the open market as an investment property, no income capitalization approach is warranted or undertaken. The sales comparison approach derives a market value opinion by making a comparative analysis of recently sold properties having similar physical and economic characteristics to the property being appraised. Each sale property is compared to the subject property focusing on similarities and differences that influence value. While the subject property is a public use, the sales collected and analyzed will be of buildings that represent or are conducive to an adaptive re -use of the subject property improvements. This approach will be applied in the valuation of the subject property. The cost approach was employed in the valuation of the subject property because the value of a "special purpose" property is often best measured by the cost to replace the property with a similar structure. In the cost approach, the estimated value of the land will be added to the direct and indirect costs associated with constructing the building and site improvements. As this type of special purpose building does not apply to the "for profit" private sector, no entrepreneurial profit will be included in the cost approach. However, an estimate of depreciation inherent in the site and building improvements will be undertaken. The estimated depreciation will be based on the economic life tables for this type of property as contained in Marshal & Swift Valuation Service, combined with the appraisers estimate of effective age. If the building were to become available for sale, the costs approach is a reasonable method to measure the amount that a potential buyer might pay for the property on an adaptive, re -use private basis. Sales Comparison Approach Several sales and listings have been selected to process the sales comparison approach to value. On a following page is a summary of the market data, followed by a Market Data Map which shows the relative location of each sale to the subject property. After this is a discussion of each of the sales, comparing each to the subject property for each relevant element of comparison and from this analysis an appropriate value indication is concluded in the reconciliation section of the appraisal report. Attempts were made to verify each sale with a party to the transaction but some of the sales information is based solely on public records; Costar, MLS, RealQuest, LandVision, and personal inspection. Epic Land Solutions, Inc. Page I34 Comparable Sales Summary SPECIAL PURPOSE BUILDING SALES APN Addral City Date Price Da 4 Seller Buyer lot Size (SF) Bldg Size (SF) Bldg Age Coverage $/PSF Land Imp 431-370-07 2202 Comstock Street San Diego 3/2412017 51,19C,C00 17-0135557 Bayside CC Elesan 220211C 47,916 4,000 1956 8.35% 3297.50 Community Center 229-291-26,27 130 Woodward Avenue Escondido 412/2017 $4,000,000 17-0163464 Fidelity Nat Title Baskets Unlimited57,064 38,183 1980 67.96% 5103.14 Religious Facility/school 527-080-07, 09 1770 Palm Avenue San Diego 12/2212017 11,700,000 17-0804940 Leann Angelic h Standing Capital 31529 13,600 1959 43.13% $125.00 Lodge/Meeting Nall 5E5-261-29 489-497 E Street Chula Vista 8/2/2018 55,50C.000 18-0315181 Farida trust lakeside Fire Dist 107,158 32,000 1946 2986% 5171.88 Church Renovated into Chatty kiwi S3,097,500 60,917 22,096 1960 3733% $114.38 Market Data Map Bormal l San..1..M.7 Rey Oceanside 'frista • 'Carlsbad, • k Le ca'dia Encinitas 4,'Rancho Sa S' rlana Beach • Del Mar La.iJotla Data rJo. 1 ` Five Point=. San Diego Intl •Sa Sutlect Property .. Jamul La-P at'-" I. ♦ nnyside Data No. 4 -� Dulzura CCT A'�tAl SU Data No. 3 V I .. -..,,_ �: Castle Park Imperial BtT �^� � General Abelardo L �:J „jl \�,Rodriyueez tnterrwatictr •_„r.-•- --•-•-•-._...-'ILN.: Tijuana ��-{.,txzr;� E `'. ♦.Pauma Valley r-Valley''Center • Data No. 2 ndido San Pasqua' • —Power Fembrµook • -" 6arona j2ancheria Jr Eucalyptus Hills Lakeside -T� Sanr.ee g • Suncrest Alpine DELORME Data use subject to license. DeLorme. DeLorme Street Atlas USA'J 2C 1 S. .' w •.•r. delorme. ccm mi 6 2 4. 6 6 16 Data Zoom 8-0 Epic Land Solutions, Inc./ Page 135 Market Data Description The sale properties are all located within the county of San Diego and are considered good alternative to a purchase of the subject property. Due to the special purpose nature of the subject property, the premise of this sales analysis is that a purchaser of the subject property and these sales would be doing so on an adaptive re -use basis. As such, some value and utility are being given to the existing building improvements for continued "special purpose" use. All of the comparable data are considered suitable alternatives for a buyer interested in purchasing the subject property. The properties range in size from 4,000 to 38,783 square feet, which brackets the size of the subject property. Overall, this is considered a very reasonable data set from which to estimate the market value of the subject property. Data 1 This is the sale of the former Bayside Community Center, a 4,000 square foot building that is on a 1.10-acre site. The property is of wood frame construction and was purchased on a sale/leaseback basis, with the buyer leasing the property back to the Bayside Community Center for a short time. While the building improvements on the property is considerable smaller than the subject it does represent a use that the subject could be adapted to. The property is now being developed with a school. Data 2 This is a foreclosure sale at a trustee sale of a property that is used for both a religious facility and a place of worship. The building sits on a 1.31-acre site, with the wood frame construction of the buildings being constructed in 1980. This represents a below market sale, with the buyer paying only $4,000,000 of a total outstanding debt of $7,003,742. The debt amount ($180.49 per square foot of building area) is more consistent with the purchase prices reflected by the other comparables. Data 3 This is the sale of a 13,600 square foot meeting hall (Fiesta Hall Events Center) that was constructed in 1959. At the time of marketing, a short-term lease was in play, with the building able to be delivered vacant to an owner use. However, the tenant in the building signed a new 5-year NNN lease with a 5-year option and was given a $75,000 credit to address deferred maintenance as part of this transaction. The building has a large open floor plan that would accommodate a variety of uses per its CC-4-2 zoning which allows for retail, commercial, office, light industrial, and automotive uses. Zoning would allow a much larger building to be constructed if desired. Data 4 This is the sale of a church located in Chula Vista that was purchased for renovation into a Charter School (Turner-Agassi Charter School). The original improvements are of wood frame construction, were built in 1946 and are situated on a 2.46-acre site. This was an all cash sale purchased on an owner -user basis. Epic Land Solutions, Inc. Page I36 Adjustment Considerations Comparable No. 1 is much smaller in size in both building and land area, is of older age and quality, and indicates a value per square foot that is much higher than that which is warranted for the subject property. This is due primarily to its small building size which Toads all the property value onto a small footprint. Comparable No. 2 is similar in land size to the subject, larger in building size, and sold on a foreclosure basis at below market. The subject should be valued much higher on a $/PSF basis than the indication of this sale. Comparable No. 3 is of older age and quality and sold on a leased basis which typically will not command the same premium price that owner -users will pay, particularly for a special purpose property. The subject should be valued at something greater than the value indication (PSF) of this comparable. Comparable No. 4 is of older age and quality, has a larger building and parcel size, and indicates a higher $/PSF indication for the subject property. Value Conclusion Based on analysis of the comparables and investigation into the value of the subject property as of October 2, 2018, the value of the subject property via sales comparison approach is concluded at $250 per square foot. This results in a total value indication of $4,860,000 ($250 x 19,440 square feet). Epic Land Solutions, Inc.f Page I37 Cost Approach Land Value As concluded in the highest and best use analysis, the most likely use of the property under its current Institutional zoning would some form of office use. As such, several sales and listings have been selected to process the sales comparison approach to value. Below is a summary of the market data, followed by a Market Data Map which shows the relative location of each sale to the subject property. After this is a discussion of each of the sales, comparing each to the subject property for each relevant element of comparison and from this analysis an appropriate value indication is concluded in the reconciliation section of the appraisal report. Land Sales Summary Data location Size No. APN SF Zone Sale Date Buyer Doc No. Seller Intended Use Sales Price Price Pe SF 1 2013rd Avenue 11,326 C-V(Comm Visitor) 8/1/2018 Redev Agency of Chula Vista Mixed -Use $40C,000 535.32 Chula Vista 91910 18-0312938 3rd Ave AC U.0 568-071-01 2 42525th Street 10,498 CN-1-3(Neigh Comm) 3/2/2017 SD Grant U.0 Office/Retan $500,CGO $47.63 San Diego 92102 17-0099487 Skyvfew Inc 535-481-03 3 9308 Carlton Oaks Drive 20,672 NC (Neigh Comm) 3/22/2018 Mark LHamel Investment/Office $519,000 $25.11 Santee 92071 13-0111555 St. Nicholas Diocese 380.112-0 4 Corner of El Camino Real/Cougar Dr 48,170 MQ(Indust with Overlay) 1/5/2018 Land DevelopmentllC Self Storage $:,600,000 $33.22 Carlsbad92008 18-0004998 NWB Carlsbad LLC 209-040-42 5 Corner Jansacha & Cardiff 47,089 CC-2-3 (Neigh Comm) 7/12/2018 City of San Diego Gas Station $1,655,0I0 San Diego 92114 N/A Unknown 577-370-18 6 SEC Discovery/San Marcos Blvd. 65,105 C (Commercial) Listing Discovery Development inc. Office S2.100,0 0 San MarcOt92078 NIA N/A 221-041-51,52,53 7 8035 Winter Gorden Blvd 27,878 GC (General Commercial) 6/30/2016 Farida Family Trust Fire Station $800,C4X 5287 lakeside 92021 16-032875 Lakeside Fire Protection 388-260-02 Subject 343 E 16th Street Property National City 91950 560-092-00 60,984 Average Size (SF) 33,077 Average Sales Price Per SF $33.83 Minimum Sales Price Per SF 525.11 Maximum Sales Price Per SF $47.63 Comparable Summary Data No. 1- Vacant in -fill parcel located in central Chula Vista (3rd Avenue Village) with a zoning that allows for a variety of commercial uses including office use. The site is level at street grade with all utilities available. The buyer intends to develop the property with a mixed - use development. Epic Land Solutions, Inc./ Page I 38 Data No. 2 - Located in the historic Grant Hill neighborhood at the edge of downtown San Diego, this property is level and has all utilities connected to the site. The property is improved with 3,300 square foot of building area in two buildings given no value by the buyer. Data No. 3 - Undeveloped parcel located off the corner of Carlton Oaks Drive & Carlton Hills Blvd. The property most is mostly level or gently sloping, with approximately 5,819 square feet unusable along the western property line. The gross area of the site is 26,491 square feet. The buyers use is unknown, with the surrounding neighborhood improved with multi -family, SFR's, and neighborhood commercial. Data No. 4 - Corner parcel with exposure to El Camino Real in an industrial/office park location. The site has 64,469 gross square feet, but the net usable area is diminished due perimeter slopes. The buyer intends to develop the site with a self -storage facility. All utilities are available to the site. Data No. 5 - The subject is a carved off portion at the corner of a larger 8.97 acre unimproved commercially zoned site which is partially improved with curbs, gutter and sidewalks. The property is zoned CC-2-3 (Community Commercial) which allows for a wide variety of commercial uses. The property was acquired by the city of San Diego for the now abandoned Encanto Expressway Project. The buyer intends to develop the site with a gas station. Data No. 6 - Three adjoining parcels located at a signalized corner near the San Marcos/Carlsbad city boundaries. This site is either adjacent to or nearby San Marcos High School, High Tech High Schools and an elementary school. The property has been used for such purposes as parking and Christmas tree sales, with curb cuts on both Discovery Street and San Marcos Blvd. However, there is only right in/right out access to the property. The gross area of the parcel is 79,715 square feet, which is reduced by slopes along the south and western property lines. Data No. 7 - This is the sale of an improved property (day care center) that was purchased for land value for construction of a fire station. No value was given to the older improvements with a newly constructed steel building and modular offices now on the site. The improvements are used by the Lakeside Fire Protection District. Epic Land Solutions, Inc., Page I 39 Adjustment Summary Adjustment Summary Data 1 Data 2 Data 3 Data 4 Data S Data 6 Data 7 Address 2013rd Avenue 425 25th Street 9308 Carlton Oaks Drive Comer of El Camino ComerJamacha & SEC Discovery/San 8035 Winter Gardens Real/Cougar Dr Cardiff Marcos Blvd. Blvd SalePrice(PSF) $35.32 $47.63 $25.11 $33.22 $34.56 $32.26 $28.70 Transactional Interest Conveyed Similar Similar Similar Similar Similar Similar Similar Conditions of Sale Similar Similar Similar Similar Similar Superior Similar Financing Similar Similar Similar Similar Similar Similar Similar Market Conditions Similar Similar Similar Similar Similar Similar Similar Comparison Similar Similar Similar Similar Similar Similar Similar Physical Location Similar Superior Inferior Superior Similar Similar Similar Access Similar Similar Similar Similar Inferior Infenor Similar Street Frontage Inferior Similar Similar Similar Similar Similar Inferior Size/shape Supenor Superior Supenor Inferior Similar Similar Superior Development Potential Similar Inferior Inferior Inferior Similar Inferior Inferior Site Imp Similar Similar Similar Similar inferior Similar Similar Overal Comparison Similar Superior inferior Inferior Inferior Inferior Inferior Indicated Value=$35.32 <$47.63 > 525.11 >$33.22 >534.56 >$32.26 >528.70 Land Value Conclusion The adjustment grid indicates that the subject property should be valued at something greater than $34.56 per square foot, something similar to $35.32 per square foot, and something less than $47.63 per square foot. Based on this analysis, a land value of $35.00 per square foot is concluded for the subject property. This results in a total land value of $2,134,000 (60,984 square feet x $35.00). Building Replacement Cost No development cost figures were provided for the building improvements. According to Marshall Valuation Service, the following replacement costs figures were provided for the fire house. Included in the summary will be an estimate of depreciation for the fire house. The depreciation estimate is based on MVS Economic Life Tables and an estimate of depreciation at 1.5% per year of effective age. Epic Land Solutions, Inc. Page I40 Depreciated Replacement Cost Direct Costs Bldg Type Class Cost Section Region Type Bldg. Size (SF) Base Cost Cost Mutt_ Local Mutt_ Adjusted Cost Total Firehouse Costs Additional Costs 5-Story Training Tower Size (ft3) S./Cu Ft Total Cost Site Improvements Site Area (SF) S/PSF Total Cost Total Direct Costs Staffed Fire House D 15 Westem Very Good/Excellent 19,440 S231.00 1.03 1.16 $274.89 $5,343,862 11,520 $10.75 $123,840 41,244 S5 00 $206,220 S5,673,922 Indirect Costs % of Direct Costs Total Cost Total Cost (D&I) Rounded Depreciation Economic Life (Yrs) Effective Age % Depreciation 15.00% $851,088 $6,525,010 $6,525,000 40 18 45.0% Depreciated Rep. Cost $3,588,750 Cost Approach Conclusion Combining the concluded land value of $2,134,000 with the depreciated replacement cost estimate of $3,588,750 results in an indicated value via cost approach of $5,722,750 rounded to $5,720,000. Epic Land Solutions, Inc. Page I41 RECONCILIATION The two approaches to value provided the following value indications for the subject property: Sales Comparison Approach Cost Approach $4,860,000 $5,720,000 Both methodologies have their strengths and weaknesses. The strength of the sales comparison approach is that it provides actual market transactions and an indication of what buyers are willing to pay for special purposes properties. However, its weakness lies in accurately assessing the value of the existing build -out for the respective properties to a buyer who will likely retrofit the building for another use. The strength of the cost approach is that it reflects the mindset of a builder who is tasked with replacing a special purpose property for a specific use. Its weakness lies in accurately estimated depreciation for a special purpose property (fire house) that does not trade on the open market. Equal consideration is given to each of the value methods in concluding to a value of $5,300,000 for the subject property. Epic Land Solutions, Inc.f Page I42 Certification The undersigned appraiser certifies that, to the best of his knowledge and belief: • The statements of fact contained in this report are true and correct. • The reported analyses, opinions and conclusions are limited only by the reported assumptions and limiting conditions, and are my personal, impartial and unbiased professional analyses, opinions, and conclusions. • I have no present, prospective, direct or indirect interest in the property that is the subject of this report, nor personal interest or bias with respect to the parties involved. • I have no bias with respect to the property that is the subject of this report or to the parties involved in this assignment. • My engagement in this assignment was not contingent upon developing or reporting predetermined results. • My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result or the occurrence of a subsequent event directly related to the intended use of this appraisal. • The reported analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute, which include the Uniform Standards of Professional Appraisal Practice. • Kent J. Carpenter, MAI has made a personal inspection of the property that is the subject of this report. • No one provided significant real property appraisal assistance to the appraiser signing this certification. • The appraiser signing this appraisal report has not provided an appraisal of the subject property in the three years immediately preceding acceptance of this assignment. There have been no other services, as an appraiser, or in any other capacity, in the previous three years. • As of the date of this report, Kent Carpenter, MAI, has completed the continuing education program of the Appraisal Institute. As of the date of this report, Kent J. Carpenter, MAI has completed the requirements of the continuing education program of the State of California. • The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. • This report is dated October 17, 2018. Very Truly Yours, Epic Land Solutions, Inc. Kent J. Carpenter, MAI Certified General Real Estate Appraiser Senior Appraiser - Epic Land Solutions, Inc. California License AG003087 Epic Land Solutions, Inc./ Page I43 Improved Sale Comparables Comparable 1 Photo Epic Land Solutions, Inc."' 44 Comparable 2 Photo Epic Land Solutions, Inc. 1 45 Comparable 3 Photo t .":111.1111 trusuc-- lilt ..... 4/ ' ' Itaatik ' A-; 1 Ea mil • 1 tj'. . .:.11-. .1111tivitlia;404100110110000• ........ I. lib 11111 111111111""W 7-401111111k light Epic Land Solutions, Inc, Pa g 46 Comparable 4 Photo Epic Land Solutions, Inca 1 47 Land Sale Comparables Comparable 1 Photo Assessor's Parcel Map / 0 0 0 90 ss "s n 4 �- �e / V A' 7/'II E tic • 24 ,/r.,s 21 20 6 7 8 Ql9 //ses • 18 /fsa9 09 cn //-firz_ t� 17 fi 6 b //S87 rf' 1 ! 0 Epic Land Solutions, Inc./ Page I 48 Comparable 2 Photo Assessor's Parcel Map 100 Epic Land Solutions, Inc. ISLAND 229.26 49 Comparable 3 Photo .cam-oN,:P47 .9a -s- 271 :3) 226 229 C7� • 202 i-ye. 9r 0 0 Op.K S 5T P.V2BSRSS Epic Land Solutions, Inc./ 50 Comparable 4 Photo B 2.41 AC ,P. 736 3a. rs 1 e. 6 S 6.34 AC R.664 _44K 0.93 AC „a- -29.41 z POR PAR 1 13.89 AC SEE DETAIL "D" 35.35 SEE DETAIL "B" SEE DETAIL "C" a 38 0 SO MAP 823 — RANCHO AGUA HEDIONDA ROS 517, 5683, 10421, 10674, 13203, 164 Epic Land Solutions, Inc., Page I51 Comparable 5 Photo Epic Land Solutions, Inc., Page I 52 Comparable 6 Photo W w 0 ~CL O CC Lid 0 COC1)} Q 4/ 00;- •oets.2 .'� PAR PM2436 3 t '.1.26 AC 2 PAR 2 0.63 AC .v.-v7#2PAR 1 ,` 0.98 AC / : ;` 3-rs PM 243 6 � `vim iy/.7c_ N4aop�a�'io/'�v, tNJt�. • . (V0 • N ' ev • • 5278 . 2 • 72 N482928T50.01 4'3 9 • -4D 'L✓ -Z.5 Jr 74, os- /Yac/ 4}' ZS''•Aso' PAR 4 3.15 AC 384.53 PM 243 6 •34T•24'45"E Epic Land Solutions, Inca Page 153 Comparable 7 Photo , Cr u L-9 V RSIRAOA c CON OM PALAIE ROYAL QOC e4-260069 9EE 9:i1.�?O.'70 12 FOUR STAR MOBILE PARK (SEE SMT. 2') O.e3AC. TO I wr • di"Lik 00/ POR 28 O 49 LAs t pA17CHO CA81 S MOO LE S,+MT HOYE (SEPARK Y►P1.2) -. si ►-}.� 0 0.04 AO ASS 43 ART'S TRAILLR PARK {SEE SHf. 2� Q MOAtIL'S- f$ OB1 LE't PARK (SEC SFIT. ?)4i r, v .qh go 0T3 ao n h 1.92 AC. N h r /OW. OP ti ti i0 1• 00 0 4 709 W I N`f' E R GARDENS R.S.__1442 . 4 60 so ZS Epic Land Solutions, Inc." Page I54 Addenda Assumptions and Limiting Conditions This report is made expressly subject to the standard assumptions and conditions which are a normal part of any real estate appraisal. 1. The term "Market Value", as used in this report is defined previously. 2. The date of value to which the conclusions and opinions expressed in this report apply, is as set forth previously in this letter. Further, the dollar amount of any value opinion rendered in this report is based upon the purchasing power of the American dollar existing on that date. 3. The appraiser assumes no responsibility for economic or physical factors which may affect the opinions in this report which occur after the date of this letter transmitting the report. 4. The information furnished by others is believed to be reliable. However, no warranty is given for its accuracy. 5. The appraiser reserves the right to make such adjustments to the analyses, opinions and conclusions set forth in this report as may be required by consideration of additional data or more reliable data that may become available. 6. No opinion as to title is rendered. Title is assumed to be marketable and free and clear of all liens, encumbrances, easements and restrictions except those specifically discussed in the report. The property is appraised assuming it to be under responsible ownership and competent management, and available for its highest and best use. 7. The appraiser assumes no responsibility for hidden or unapparent conditions of the property, subsoil, or structures that render it more or less valuable. No responsibility is assumed for arranging for engineering studies that may be required to discover them. 8. The property is appraised assuming it to be in full compliance with all applicable federal, state, and local environmental regulations and laws, unless otherwise stated. 9. The property is appraised assuming that all applicable zoning and use regulations and restrictions have been complied with, unless otherwise stated. 10. The property is appraised assuming that all required licenses, certificates of occupancy, consents, or other legislative or administrative authority from any local, state, or national government or private entity or organization have been or can be obtained or renewed for any use on which the value estimate contained in this report is based, unless otherwise stated. 11. No engineering survey has been made by the appraisers. Except as specifically stated, data relative to size and area was taken from sources considered reliable and no encroachment of real property improvements is considered to exist. 12. No opinion is expressed as to the value of subsurface oil, gas or mineral rights or whether the property is subject to surface entry for the exploration or removal of such materials except as expressly stated. 13. Maps, plats and exhibits included in this part are for illustration only as an aid in visualizing matters discussed within the report. They should not be considered as surveys or relied upon for any other purpose, nor should they be removed from, reproduced, or used apart from the report. Epic Land Solutions, Inc.% Page I55 14. No opinion is intended to be expressed for matters which require legal expertise or specialized investigation or knowledge beyond that customarily employed by real estate appraisers 15. That possession of this report, or a copy of it, does not carry with it the right of publication. It may not be used for any purpose by any person other than the party to whom it is addressed without the written consent of the appraiser, and in any event only with proper written qualification and only in its entirety. 16. Unless specifically stated, this appraisal does not take into consideration the possibility of the existence of asbestos, PCB transformers or other toxic, hazardous, or contaminated substances and/or underground storage tank (hazardous material), or the cost of encapsulation or removing thereof. Should the client have concern over the existence of such substances on the property, we consider it imperative for you to retain the services of a qualified independent engineer or contractor to determine the existence and extent of any hazardous materials, as well as the cost associated with any required or desirable treatment or removal thereof. 17. The value is of the real estate only and assumes continued use of the property as a viable fire station. No value is given to any specialized furniture, fixtures or equipment that would be necessary to operate a fire station. Epic Land Solutions, Inc./ Page I56 Background and Qualifications Kent -Carpenter, MAl,-senior-Appraiser¶ Total•Years•of• Experience:63j fl Yearswithfirm:<11 Education:•Bac helorof-Science,- Financial-Planning&Counseling,- Brigham-Young-Un iversity9 Graduate-Courses,-San-Diego-State- Universityl Registrations/Certifications:• 1 CertifiedGeneral-Real Estate• Appraiser,-StateofCalifornia,- LicensettAG0030879 Associat ion s/Organizations: y MAI Designated-Merrber,-Appraisal- Institute-9 Office r, San-Diego-Chapterof the - Appraisal Institute,•20089 Government{lients:•l United -States Department -of -the -Interior Kent- 1.- Carpenter has- over 30 years of- experience- inthe- valuation- cf- residential,-commercial,industrial,-agricultural-and-special-purpose-prcperties- in-Ca lifornia.-Prior-to-joining-Epic,-Carpenterworked-as-Managing-Director-for the-San.Diego-offices-of-H;Ico-Real-Estate-Appraisal•and-Grubb-&-Eflis-Iandauer Valuation Services. Additionally, -he -was -a -principal -at -a -top -San -Diego -County appraisal- firm-- Lipman,- Stevens- & Carpenter,• Inc.- Carpenter's- extensive experience-includesexpert witness -testimony -in -federal -bankruptcy -court, -San• Diego- Superior Court- and- arbitrations/depositions- involving- real- estate. values --Clients include-government-entities,-financial-institutions,-accounting- firms,- insurance• companies,. law- firms,• developers- and. private. property- owners.9 Please- note:- The- appraisal- group- works- independently- within- the. Epic organization- to -ensure. complete. objectivity- and -impartiality -for -all -appraisal• opinions -and -conclusions.¶ • Relevant•ExperienceJ Valuation•Specialties:• 1 Special -purpose -properties -0- Agricultural -Land Industrial/Flex-Buildings -. Shopping -Centers Retail.Properties Condemnations9 Par-ai Interes-s9 Multi-Family9 Hctels9 Offices9 General -Services Adrninistration-(GSA)9 LosAng&es-County-Community-Development-Commission — Port-of-San-Diego9 San-Diego-Metropolitan-Transit-System-{MTS) City -of La -Mesa+ City-of-National•City -. Perris Elementary -School District 9 Countyof-San-Diego -. City-of•San-Diego9 San-Diego-Unified-Schocl District+9 1 Financial •Institution { Iients: -9 Teachers-Insurance-&-Annuity-Associatior—Ccilege-RetirementEquities-Fund-(TIAA-CREF)9 ING-(Retirement-&-Insurance-Products-&Services) 11 CapitalSource-Lending -+ Ca liforn ia -Ba n k-&-Trust -► Embarcadero-Bank -. Bank -of -America Wells Fargo -Bank -. Union-Bank9 Bank -of -the -West Metro -United -Bank -. City -National -Bank -+ 9 Ironstone -Bank -. Rabobank -. Resmark Equity-Partners9 9 Real-Estate-Clients:1 Quadrant Real -Estate Advisors-► BAE Systems -4 M1oss Adams -a ti Internal Revenue-Service9 Epic Land Solutions, Inc., p ,a i 57 Mayor Alejandra Sotelo-Solis Council Members Ron Morrison Mona Rios Jerry Cano Gonzalo Quintero April 3, 2019 o R N t A *-�+ N °NAL airy INCORppgATED Office of the City Attorney Honorable Ben Carson Secretary of Housing and Urban Development 451 7th Street S.W., Washington, D.C. 20410 Dear Secretary Carson: City Attorney Angil P. Morris -Jones Senior Assistant City Attorney Nicole Pedone Deputy City Attorney Roberto M. Contreras The undersigned, being duly licensed and in good standing to practice law in the State of California, is legal counsel to the City of National City ("Borrower"). As such, I have represented the Borrower regarding that certain promissory note, referred to as Note No. B-OO-MC-06-0560, in the Aggregate Principal Amount of $6,900,000 ("Note"), to be executed by the Borrower payable to the order of the Registered Holder thereof, and to be guaranteed by the Secretary of Housing and Urban Development ("HUD") under Section 108 of the Housing and Development Act of 1974, as amended, 42 U.S.C. 5308 ("Section 108"). The Note will be included in a trust created by HUD (together with other Section 108 Notes issued by other borrowers), and trust certificates based on the trust will be sold in the Series 2003-A public offering by underwriters selected by HUD. HUD's guarantee of the Note will be governed by the Contract for Loan Guarantee Assistance under Section 108 between the Borrower and HUD (the "Contract"), in which the Borrower pledges Community Development Block Grants pursuant to 24 CFR 570.705(b)(2), as well as any other security specified in the Contract, as security for HUD's guarantee. In my capacity as legal counsel, I have made an examination and investigation of all such matters of fact and questions of law as I consider necessary or advisable to enable me to render the opinion hereafter set forth. Specifically, and without limiting the generality of the foregoing, I have examined: 1. A Resolution of the governing body of Borrower dated July 15, 2003, authorizing Borrower to enter into this transaction, and authorizing the Mayor of the City of National City to execute on behalf of Borrower all documents necessary or desirable to accomplish the transaction. 2. The Contract 3. The Note 1243 National City Boulevard; National City, California 91950-4397 Tel.: (619) 336-4220 Fax: (619) 336-4327 The Hon. Ben Carson April 3, 2019 Page 2 4. The Trust Agreement, the Amended and Restated Master Fiscal Agency Agreement, and the form of Supplement to the Trust Agreement to be executed by the Secretary of HUD for the closing of the Public offering. 5. The Deed of Trust, Security Agreement, and Fixture Filing with Assignment of Rents recorded on January 14, 2015 in the County of San Diego Official Records as Document No. 2015-0016958. Based on the foregoing investigation and authorities, I am of the opinion that: 1. Borrower has authorized in accordance with applicable State and local law, the transaction, including issuance of the Note, the pledge of grant funds, and the execution of all documents necessary or desirable to accomplish the transaction. 2. The Note and the Contract have been duly executed by the aforementioned authorized representative of the Borrower, and upon delivery thereof, due execution of the Contract and Guarantee on behalf of HUD, and receipt of the loan proceeds on behalf of the Borrower, the Note and Contract shall be valid, binding and enforceable obligations of the Borrower. 3. The pledge of present and future Community Development Block Grants by the Borrower pursuant to 24 CFR.570.705 (b)(2) and the Contract is valid. 4. The Deed of Trust, Security Agreement, and Fixture Filing with Assignment of Rents recorded on January 14, 2015 in the County of San Diego Official Records as Document No. 2015-0016958 is a valid and legally binding obligation, enforceable in accordance with its terms. 5. There is no outstanding, or to my knowledge threatened, action, suit, proceeding, investigation or litigation by or against the Borrower that will affect the validity of the Note or the security therefor. Sincerely, Angil .rri Cit, 'ttorney CITY OF NATIONAL CITY Office of the City Clerk 1243 National City Blvd., National City, California 91950-4397 619-336-4228 Michael R. Dalla, CMC - City Clerk CHICAGO TITLE COMPANY Section 108 Guaranteed Loan Custodial Agreement Fire Station #34 Greg Rose (Housing & Economic Development) forwarded a duplicate original Agreement to Chicago Title Company.