HomeMy WebLinkAboutC2016-520 - 5/19/2016 - NA Loan No.: 1015872
SUBORDINATION AND STANDSTILL AGREEMENT
(HOME Loan)
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON,
YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING
INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN
REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS:
YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
THIS SUBORDINATION AND STANDSTILL AGREEMENT (this "Agreement") is
entered into this 19th day of May,2016,by and among(i) WELLS FARGO BANK,N.A., a national
banking association(together with its successors and/or assigns,the"Senior Lender"),(ii)CORPUS
CHRISTI COMMUNITY IMPROVEMENT CORPORATION, a Texas non-profit corporation(the
"Subordinate Lender"), and (iii) TG 110 GLENOAK, LP, a Texas limited partnership (the
"Borrower").
Recitals
A. Pursuant to the terms and conditions of the Construction Loan Agreement of even
date herewith (the "Construction Loan Agreement"), the Senior Lender has made or is making a
loan(the"First Mortgage Loan")to the Borrower in the original principal amount of$9,300,000.00.
The First Mortgage Loan is or will be secured by a first mortgage lien (the "First Mortgage") on a
multifamily housing project located in Corpus Christi, Texas (the "Property"). The Property is
more fully described in Exhibit A attached hereto. The Borrower's obligation to repay the First
Mortgage Loan is evidenced by a Promissory Note dated May 19, 2016 (the "First Mortgage
Note"),and is due in full on May 19,2018.
B. The Borrower has requested the Senior Lender to permit the Subordinate Lender to
make a subordinate loan to Borrower in the amount of$300,000.00(the"Subordinate Loan")and to
secure the Subordinate Loan by,among other things,placing a mortgage lien against the Property.
C. The Senior Lender has agreed to permit the Subordinate Lender to make the
Subordinate Loan and to place a subordinate mortgage lien against the Property subject to all of the
conditions contained in this Agreement.
D. Upon satisfaction of all conditions to funding set forth in the commitment dated
May 19, 2016 to Borrower from Senior Lender dated of even date herewith (referred to herein as
"Stabilization"), the First Mortgage Loan will be satisfied in connection with the origination of the
Permanent Loan(as defined in the Construction Loan Agreement and hereafter used).
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2016-520
5/19/16
TG 110 Glenoak LP INDEXED
NOW, THEREFORE, in order to induce the Senior Lender to permit the Subordinate
Lender to make the Subordinate Loan to the Borrower and to place a subordinate mortgage lien
against the Property, and in consideration thereof, the Senior Lender, the Subordinate Lender and
the Borrower agree as follows:
1. Definitions.
In addition to the terms defined in the Recitals to this Agreement, for purposes of this
Agreement the following terms have the respective meanings set forth below:
"Affiliate"means, when used with respect to a Person, any corporation,partnership,
joint venture, limited liability company, limited liability partnership, trust or individual
controlled by, under common control with, or which controls such Person (the term
"control" for these purposes shall mean the ability, whether by the ownership of shares or
other equity interests, by contract or otherwise, to elect a majority of the directors of a
corporation, to make management decisions on behalf of, or independently to select the
managing partner of, a partnership, or otherwise to have the power independently to remove
and then select a majority of those individuals exercising managerial authority over an
entity, and control shall be conclusively presumed in the case of the ownership of 50% or
more of the equity interests).
"Borrower" means the Person named as such in the first paragraph of this
Agreement and any other Person (other than the Senior Lender) who acquires title to the
Property after the date of this Agreement.
"Business Day" means any day other than Saturday, Sunday or a day on which the
Senior Lender is not open for business.
"Default Notice" means: (a) a copy of the written notice from the Senior Lender to
the Borrower stating that a First Mortgage Loan Default has occurred under the First
Mortgage Loan; or (b) a copy of the written notice from the Subordinate Lender to the
Borrower stating that a Subordinate Loan Default has occurred under the Subordinate Loan.
Each Default Notice shall specify the default upon which such Default Notice is based.
"First Mortgage" means, prior to Stabilization, that certain Construction Deed of
Trust with Absolute Assignment of Leases and Rents, Security Agreement and Fixture
Filing, dated as of May 19, 2016, made by Borrower for the benefit of Senior Lender, and,
following Stabilization,the Permanent Mortgage.
"First Mortgage Loan Default" means the occurrence of an "Event of Default" as
that term is defined in the Construction Loan Agreement and/or the occurrence of a
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"default" or an "Event of Default" (including the expiration of all applicable notice, grace,
and cure periods)under the Permanent Loan Documents.
"First Mortgage Loan Documents" means (i) the First Mortgage Note and all other
documents evidencing, securing, governing, or otherwise executed and delivered in
connection with the First Mortgage Loan; and (ii) following Stabilization, the Permanent
Loan Documents.
"First Mortgage Note" means, prior to Stabilization, that certain Promissory Note,
dated as of May 19, 2016, made by Borrower and payable to the order of the Senior Lender,
and, following Stabilization,the Permanent Note.
"Permanent Loan Documents" means the Permanent Note, the Permanent Mortgage
and all other documents evidencing, securing, governing, and/or otherwise executed and
delivered in connection with the Permanent Loan.
"Permanent Mortgage" means that certain Multifamily Deed of Trust, Assignment
of Rents, Security Agreement and Fixture Filing delivered by Borrower to Senior Lender
and encumbering the Property to secure the obligations of Borrower under the Permanent
Note.
"Permanent Note" means that certain Promissory Note (Term Only) delivered by
Borrower to Senior Lender to evidence the Permanent Loan.
"Person"means an individual, estate, trust, partnership, corporation, limited liability
company, limited liability partnership, governmental department or agency or any other
entity which has the legal capacity to own property.
"Senior Lender"means the Person named as such in the first paragraph on page 1 of
this Agreement. When any other Person becomes the legal holder of the First Mortgage
Note or of the Permanent Loan Documents, such other Person shall automatically become
the Senior Lender.
"Subordinate Lender" means the Person named as such in the first paragraph on
page 1 of this Agreement and any other Person who becomes the legal holder of the
Subordinate Note after the date of this Agreement.
"Subordinate Loan Default" means a default by the Borrower in performing or
observing any of the terms, covenants or conditions in the Subordinate Loan Documents to
be performed or observed by it, which continues beyond any applicable period provided in
the Subordinate Loan Documents for curing the default.
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"Subordinate Loan Documents" means the Subordinate Note, the Subordinate
Mortgage, and all other documents evidencing, securing, governing, and/or otherwise
executed and delivered in connection with the Subordinate Loan.
"Subordinate Mortgage" means the mortgage or deed of trust encumbering the
Property as security for the Subordinate Loan, which the Subordinate Lender will cause to
be recorded among the applicable land records immediately before this Agreement.
"Subordinate Note" means the promissory note of even date herewith issued by the
Borrower to the Subordinate Lender,or order,to evidence the Subordinate Loan.
2. Permission to Place Mortgage Lien Against Property.
The Senior Lender agrees, notwithstanding the prohibition against inferior liens on the
Property contained in the First Mortgage Loan Documents or the Permanent Loan Documents and
subject to the provisions of this Agreement, to permit the Subordinate Lender to record the
Subordinate Mortgage and other recordable Subordinate Loan Documents against the Property
(which are subordinate in all respects to the lien of the First Mortgage and the Permanent Loan)to
secure the Borrower's obligation to repay the Subordinate Note and all other obligations,
indebtedness and liabilities of the Borrower to the Subordinate Lender under and in connection with
the Subordinate Loan. Such permission is subject to the condition that each of the representations
and warranties made by the Borrower and the Subordinate Lender in Section 3 is true and correct in
all material respects on the date of this Agreement and on the date on which the proceeds of the
Subordinate Loan are disbursed to the Borrower. If any of the representations and warranties made
by the Borrower and the Subordinate Lender in Section 3 is not true and correct in all material
respects on both of those dates, the provisions of the First Mortgage Loan Documents and the
Permanent Loan Documents applicable to unpermitted liens on the Property shall apply.
3. Borrower's and Subordinate Lender's Representations and Warranties.
The Borrower and the Subordinate Lender each makes the following representations and
warranties to the Senior Lender:
(a) Subordinate Note. The Subordinate Note contains the following provision:
The indebtedness evidenced by this Note is and shall be subordinate
in right of payment to the prior payment in full of the indebtedness
evidenced by the First Mortgage Note (as defined in the Subordination
Agreement), to the extent and in the manner provided in that certain
Subordination and Standstill Agreement of even date herewith between the
Borrower, Wells Fargo Bank, N.A. (the "Senior Lender") and the payee of
this Note (the "Subordination Agreement"). The Deed of Trust securing this
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Note is and shall be subject and subordinate in all respects to the liens,terms,
covenants and conditions of the Deed of Trust securing the Note payable to
Senior Lender as more fully set forth in the Subordination Agreement. The
rights and remedies of the payee and each subsequent holder of this Note
under the Deed of Trust securing this Note are subject to the restrictions and
limitations set forth in the Subordination Agreement. Each subsequent
holder of this Note shall be deemed, by virtue of such holder's acquisition of
the Note, to have agreed to perform and observe all of the terms, covenants
and conditions to be performed or observed by the payee of this Note under
the Subordination Agreement.
(b) Relationship of Borrower to Subordinate Lender and Senior Lender.
The Subordinate Lender is not an Affiliate of the Borrower and is not in possession of any
facts which would lead it to believe that the Senior Lender is an Affiliate of the Borrower.
(c) Term. The term of the Subordinate Note does not end before the term of the
First Mortgage Note.
(d) Subordinate Loan Documents. The executed Subordinate Loan
Documents are substantially in the same forms as those submitted to, and approved by,
Senior Lender prior to the date of this Agreement. Upon execution and delivery of the
Subordinate Loan Documents, Borrower shall deliver to Senior Lender an executed copy of
each of the Subordinate Loan Documents, and if requested by Senior Lender at the time of
such delivery,certified to be true, correct and complete.
(e) Senior Loan Documents. The executed First Mortgage Loan Documents
are substantially in the same forms as, when applicable, those submitted to, and approved
by, Senior Lender prior to the date of this Agreement.
4. Terms of Subordination.
(a) Agreement to Subordinate. The Senior Lender and the Subordinate
Lender agree that: (i) the indebtedness evidenced by the Subordinate Loan Documents is
and shall be subordinated in right of payment, to the extent and in the manner provided in
this Agreement to the prior payment in full of the indebtedness evidenced by the First
Mortgage Loan Documents, and (ii) the Subordinate Mortgage and the other Subordinate
Loan Documents are and shall be subject and subordinate in all respects to the liens, terms,
covenants and conditions of the First Mortgage and the other First Mortgage Loan
Documents and to all advances heretofore made or which may hereafter be made pursuant to
the First Mortgage and the other First Mortgage Loan Documents (including but not limited
to, all sums advanced for the purposes of(1) protecting or further securing the lien of the
First Mortgage, curing defaults by the Borrower under the First Mortgage Loan Documents
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or for any other purpose expressly permitted by the First Mortgage, or (2) constructing,
renovating,repairing,furnishing, fixturing or equipping the Property).
(b) Subordination of Subrogation Rights. The Subordinate Lender agrees that
if, by reason of its payment of real estate taxes or other monetary obligations of the
Borrower, or by reason of its exercise of any other right or remedy under the Subordinate
Loan Documents, it acquires by right of subrogation or otherwise a lien on the Property
which(but for this subsection)would be senior to the lien of the First Mortgage,then, in that
event, such lien shall be subject and subordinate to the lien of the First Mortgage.
(c) Payments Before First Mortgage Loan Default. Until the Subordinate
Lender receives a Default Notice of a First Mortgage Loan Default from the Senior Lender,
the Subordinate Lender shall be entitled to retain for its own account all payments made
under or pursuant to the Subordinate Loan Documents.
(d) Payments After First Mortgage Loan Default. The Borrower agrees that,
after it receives notice (or otherwise acquires knowledge) of a First Mortgage Loan Default,
it will not make any payments under or pursuant to the Subordinate Loan Documents
(including but not limited to principal, interest, additional interest, late payment charges,
default interest, attorney's fees, or any other sums secured by the Subordinate Mortgage)
without the Senior Lender's prior written consent. The Subordinate Lender agrees that,after
it receives a Default Notice from the Senior Lender with written instructions directing the
Subordinate Lender not to accept payments from the Borrower on account of the
Subordinate Loan, it will not accept any payments under or pursuant to the Subordinate
Loan Documents (including but not limited to principal, interest, additional interest, late
payment charges, default interest, attorney's fees, or any other sums secured by the
Subordinate Mortgage) without the Senior Lender's prior written consent. If the
Subordinate Lender receives written notice from the Senior Lender that the First Mortgage
Loan Default which gave rise to the Subordinate Lender's obligation not to accept payments
has been cured, waived, or otherwise suspended by the Senior Lender, the restrictions on
payment to the Subordinate Lender in this Section 4 shall terminate, and the Senior Lender
shall have no right to any subsequent payments made to the Subordinate Lender by the
Borrower prior to the Subordinate Lender's receipt of a new Default Notice from the Senior
Lender in accordance with the provisions of this Section 4(d).
(e) Remitting Subordinate Loan Payments to Senior Lender. If, after the
Subordinate Lender receives a Default Notice from the Senior Lender in accordance with
subsection (d) above, the Subordinate Lender receives any payments under the Subordinate
Loan Documents, the Subordinate Lender agrees that such payment or other distribution
will be received and held in trust for the Senior Lender and unless the Senior Lender
otherwise notifies the Subordinate Lender in writing, will be promptly remitted, in kind to
the Senior Lender,properly endorsed to the Senior Lender, to be applied to the principal of,
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interest on and other amounts due under the First Mortgage Loan Documents in accordance
with the provisions of the First Mortgage Loan Documents. By executing this Agreement,
the Borrower specifically authorizes the Subordinate Lender to endorse and remit any such
payments to the Senior Lender, and specifically waives any and all rights to have such
payments returned to the Borrower or credited against the Subordinate Loan. Borrower and
Senior Lender acknowledge and agree that payments received by the Subordinate Lender,
and remitted to the Senior Lender under this Section 4, shall not be applied or otherwise
credited against the Subordinate Loan, nor shall the tender of such payment to the Senior
Lender waive any Subordinate Loan Default which may arise from the inability of the
Subordinate Lender to retain such payment or apply such payment to the Subordinate Loan.
(f) Agreement Not to Commence Bankruptcy Proceeding. The Subordinate
Lender agrees that during the term of this Agreement it will not commence,or join with any
other creditor in commencing any bankruptcy reorganization, arrangement, insolvency or
liquidation proceedings with respect to the Borrower, without the Senior Lender's prior
written consent.
5. Default Under Subordinate Loan Documents.
(a) Notice of Default and Cure Rights. The Subordinate Lender shall deliver
to the Senior Lender a Default Notice within five Business Days in each case where the
Subordinate Lender has given a Default Notice to the Borrower. Failure of the Subordinate
Lender to send a Default Notice to the Senior Lender shall not prevent the exercise of the
Subordinate Lender's rights and remedies under the Subordinate Loan Documents, subject
to the provisions of this Agreement. The Senior Lender shall have the right, but not the
obligation,to cure any Subordinate Loan Default within 60 days following the date of such
notice; provided, however that the Subordinate Lender shall be entitled, during such 60-day
period,to continue to pursue its rights and remedies under the Subordinate Loan Documents
to the extent permitted under Section 5(b). All amounts paid by the Senior Lender in
accordance with the First Mortgage Loan Documents to cure a Subordinate Loan Default
shall be deemed to have been advanced by the Senior Lender pursuant to, and shall be
secured by the lien of,the First Mortgage.
(b) Subordinate Lender's Agreement to Standstill. If a Subordinate Loan
Default occurs and is continuing, the Subordinate Lender agrees that, without the Senior
Lender's prior written consent, it will not accelerate the Subordinate Loan, commence
foreclosure proceedings with respect to the Property, collect rents, appoint (or seek the
appointment of)a receiver or institute any other collection or enforcement action against the
Property; provided, however, that the Subordinate Lender shall be entitled to exercise all
other rights and remedies available under applicable laws, including, without limitation,
rights to enforce restrictions relating to income, rent, and affordability restrictions contained
therein.
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(c) Cross Default. The Borrower and the Subordinate Lender agree that a
Subordinate Loan Default shall constitute a First Mortgage Loan Default under the First
Mortgage Loan Documents and the Senior Lender shall have the right to exercise all rights
or remedies under the First Mortgage Loan Documents in the same manner as in the case of
any other First Mortgage Loan Default. If the Subordinate Lender notifies the Senior
Lender in writing that any Subordinate Loan Default of which the Senior Lender has
received a Default Notice has been cured or waived, as determined by the Subordinate
Lender in its sole and reasonable discretion, then provided that Senior Lender has not
conducted a sale of the Property pursuant to its rights under the First Mortgage Loan
Documents, any First Mortgage Loan Default under the First Mortgage Loan Documents
arising solely from such Subordinate Loan Default shall be deemed cured, and the First
Mortgage Loan shall be reinstated, provided, however, that the Senior Lender shall not be
required to return or otherwise credit for the benefit of the Borrower any default rate interest
or other default related charges or payments received by the Senior Lender during such First
Mortgage Loan Default.
6. Default Under First Mortgage Loan Documents.
(a) Notice of Default and Cure Rights. The Senior Lender shall deliver to the
Subordinate Lender a Default Notice within five Business Days in each case where the
Senior Lender has given a Default Notice to the Borrower. Failure of the Senior Lender to
send a Default Notice to the Subordinate Lender shall not prevent the exercise of the Senior
Lender's rights and remedies under the First Mortgage Loan Documents, subject to the
provisions of this Agreement. The Subordinate Lender shall have the right, but not the
obligation, to cure any such First Mortgage Loan Default as provided below. Subordinate
Lender may have up to 30 days from the date of delivery of the Default Notice to cure any
monetary default under the First Mortgage Loan Documents; provided, however, that the
Senior Lender shall be entitled during such 30-day period to continue to pursue its remedies
with respect to the Property. Subordinate Lender may have up to 60 days from the date of
delivery of the Default Notice to cure a non-monetary default if during such 60-day period
Subordinate Lender keeps current all payments required by the First Mortgage Loan
Documents. In the event that such a non-monetary default creates an unacceptable level of
risk relative to the Property, or Senior Lender's secured position relative to the Property, as
determined by Senior Lender in its sole discretion, then Senior Lender may exercise during
such 60-day period all available rights and remedies to protect and preserve the Property and
the rents, revenues and other proceeds from the Property as provided in the Loan
Documents. All amounts paid by the Subordinate Lender to the Senior Lender to cure a
First Mortgage Loan Default shall be deemed to have been advanced by the Subordinate
Lender pursuant to,and shall be secured by the lien of,the Subordinate Mortgage.
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(b) Cross Default. The Subordinate Lender agrees that, notwithstanding any
contrary provision contained in the Subordinate Loan Documents, a First Mortgage Loan
Default shall not constitute a default under the Subordinate Loan Documents if no other
default occurred under the Subordinate Loan Documents until either (i) the Senior Lender
has accelerated the maturity of the First Mortgage Loan, or(ii) the Senior Lender has taken
affirmative action to exercise its rights under the First Mortgage to collect rent, to appoint
(or seek the appointment of) a receiver or to foreclose on (or to exercise a power of sale
contained in) the First Mortgage. At any time after a First Mortgage Loan Default is
determined to constitute a default under the Subordinate Loan Documents, the Subordinate
Lender shall be permitted to pursue its remedies for default under the Subordinate Loan
Documents, subject to the restrictions and limitations of this Agreement. If at any time the
Borrower cures any First Mortgage Loan Default to the satisfaction of the Senior Lender, as
evidenced by written notice from the Senior lender to the Subordinate Lender, any default
under the Subordinate Loan Documents arising from such First Mortgage Loan Default
shall be deemed cured and the Subordinate Loan shall be retroactively reinstated as if such
First Mortgage Loan Default had never occurred.
7. Conflict.
The Borrower, the Senior Lender and the Subordinate Lender each agrees that, in the event
of any conflict or inconsistency between the terms of the First Mortgage Loan Documents, the
Subordinate Loan Documents and the terms of this Agreement, the terms of this Agreement shall
govern and control solely as to the following: (a)the relative priority of the security interests of the
Senior Lender and the Subordinate Lender in the Property; (b) the timing of the exercise of
remedies by the Senior Lender and the Subordinate Lender under the First Mortgage and the
Subordinate Mortgage, respectively; and (c) solely as between the Senior Lender and the
Subordinate Lender,the notice requirements, cure rights, and the other rights and obligations which
the Senior Lender and the Subordinate Lender have agreed to as expressly provided in this
Agreement. Borrower acknowledges that the terms and provisions of this Agreement shall not, and
shall not be deemed to: extend Borrower's time to cure any First Mortgage Loan Default or
Subordinate Loan Default, as the case may be; give the Borrower the right to notice of any First
Mortgage Loan Default or Subordinate Loan Default, as the case may be other than that, if any,
provided, respectively under the First Mortgage Loan Documents or the Subordinate Loan
Documents; or create any other right or benefit for Borrower as against Senior Lender or
Subordinate Lender.
8. Rights and Obligations of the Subordinate Lender Under the Subordinate
Loan Documents and of the Senior Lender under the First Mortgage Loan Documents.
Subject to each of the other terms of this Agreement, all of the following provisions shall
supersede any provisions of the Subordinate Loan Documents covering the same subject matter:
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(a) Protection of Security Interest. The Subordinate Lender shall not, without
the prior written consent of the Senior Lender in each instance, take any action which has
the effect of increasing the indebtedness outstanding under, or secured by, the Subordinate
Loan Documents, except that the Subordinate Lender shall have the right to advance funds
to cure First Mortgage Loan Defaults pursuant to Section 6(a) above and advance funds
pursuant to the Subordinate Mortgage for the purpose of paying real estate taxes and
insurance premiums, making necessary repairs to the Property and curing other defaults by
the Borrower under the Subordinate Loan Documents.
(b) Condemnation or Casualty. In the event of: a taking or threatened taking
by condemnation or other exercise of eminent domain of all or a portion of the Property
(collectively, a "Taking"); or the occurrence of a fire or other casualty resulting in damage
to all or a portion of the Property(collectively, a"Casualty"), at any time or times when the
First Mortgage remains a lien on the Property the following provisions shall apply:
(1) The Subordinate Lender hereby agrees that its rights (under the
Subordinate Loan Documents or otherwise) to participate in any proceeding or
action relating to a Taking and/or a Casualty, or to participate or join in any
settlement of, or to adjust, any claims resulting from a Taking or a Casualty shall be
and remain subordinate in all respects to the Senior Lender's rights under the First
Mortgage Loan Documents with respect thereto, and the Subordinate Lender shall
be bound by any settlement or adjustment of a claim resulting from a Taking or a
Casualty made by the Senior Lender; provided, however, this subsection and/or
anything contained in this Agreement shall not limit the rights of the Subordinate
Lender to file any pleadings,documents,claims or notices with the appropriate court
with jurisdiction over the proposed Taking and/or Casualty; and
(2) all proceeds received or to be received on account of a Taking or a
Casualty, or both, shall be applied (either to payment of the costs and expenses of
repair and restoration or to payment of the First Mortgage Loan) in the manner
determined by the Senior Lender in its sole and reasonable discretion; provided,
however, that if the Senior Lender elects to apply such proceeds to payment of the
principal of, interest on and other amounts payable under the First Mortgage Loan,
any proceeds remaining after the satisfaction in full of the principal of, interest on
and other amounts payable under the First Mortgage Loan shall be paid to, and may
be applied by, the Subordinate Lender in accordance with the applicable provisions
of the Subordinate Loan Documents,provided however, the Senior Lender agrees to
consult with the Subordinate Lender in determining the application of Casualty
proceeds, provided further however that in the event of any disagreement between
the Senior Lender and the Subordinate Lender over the application of Casualty
proceeds,the decision of the Senior Lender, in its sole discretion, shall prevail.
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(c) No Modification of Subordinate Loan Documents. The Borrower and the
Subordinate Lender each agrees that,until the principal of, interest on and all other amounts
payable under the First Mortgage Loan Documents have been paid in full, it will not,
without the prior written consent of the Senior Lender in each instance, increase the amount
of the Subordinate Loan, increase the required payments due under the Subordinate Loan,
decrease the term of the Subordinate Loan, increase the interest rate on the Subordinate
Loan, or otherwise amend the Subordinate Loan terms in a manner that creates an adverse
effect upon the Senior Lender under the First Mortgage Loan Documents. Any unauthorized
amendment of the Subordinate Loan Documents or assignment of the Subordinate Lender's
interest in the Subordinate Loan without the Senior Lender's consent shall be void ab initio
and of no effect whatsoever and Subordinate Lender agrees that it shall not transfer or assign
the Subordinate Loan or the Subordinate Loan Documents without the prior written consent
of the Senior Lender.
9. Stabilization,Modification or Refinancing of First Mortgage Loan.
The Subordinate Lender consents to any agreement or arrangement in which the Senior
Lender waives, postpones, extends, reduces or modifies any provisions of the First Mortgage Loan
Documents, including any provision requiring the payment of money. Subordinate Lender further
agrees that its agreement to subordinate hereunder shall extend to the Permanent Loan Documents,
as well as to any new mortgage debt which is for the purpose of refinancing all or any part of the
First Mortgage Loan (including reasonable and necessary costs associated with the closing and/or
the refinancing) and, in the event of new mortgage debt, Subordinate Lender shall execute and
deliver to Senior Lender a new subordination agreement on the same terms and conditions as this
Subordination Agreement. Following Stabilization, all the terms and covenants of this Agreement
shall inure to the benefit of any holder of the Permanent Loan; and all references to the First
Mortgage Loan, the First Mortgage Note, the First Mortgage and the First Mortgage Loan
Documents shall mean, respectively, the Permanent Loan, the Permanent Note, the Permanent
Mortgage and the Permanent Loan Documents.
10. Default by the Subordinate Lender or Senior Lender.
If the Subordinate Lender or Senior Lender defaults in performing or observing any of the
terms, covenants or conditions to be performed or observed by it under this Agreement, the other,
non-defaulting lender shall have the right to all available legal and equitable relief.
11. Notices.
Each notice, request, demand, consent, approval or other communication (hereinafter in this
Section referred to collectively as "notices" and referred to singly as a "notice") which the Senior
Lender or the Subordinate Lender is required or permitted to give to the other party pursuant to this
Agreement shall be in writing and shall be deemed to have been duly and sufficiently given if: (a)
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personally delivered with proof of delivery thereof(any notice so delivered shall be deemed to have
been received at the time so delivered); or (b) sent by Federal Express (or other similar national
overnight courier) designating early morning delivery (any notice so delivered shall be deemed to
have been received on the next Business Day following receipt by the courier); or(c)sent by United
States registered or certified mail,return receipt requested,postage prepaid, at a post office regularly
maintained by the United States Postal Service (any notice so sent shall be deemed to have been
received three business days after mailing in the United States), addressed to the respective parties
as follows:
SENIOR LENDER:
Wells Fargo Bank,N.A.
Community Lending and Investment
5080 Spectrum Drive, Suite 500E-A
Addison, Texas 75001
MAC T9000-OSH
Attn: Loan Administration
SUBORDINATE LENDER:
Corpus Christi Community Improvement Corporation
c/o City of Corpus Christi
P.O. Box 9277
Corpus Christi,Texas 78469-9277
WITH A COPY OF ALL NOTICES SENT UNDER THIS
AGREEMENT BEING SENT AT THE SAME TIME AND
IN THE SAME MANNER TO:
TG 110, Inc.
8610 North New Braunfels, Suite 500
San Antonio,Texas 78217
Attention: Executive Director
Either party may, by notice given pursuant to this Section, change the person or persons and/or
address or addresses, or designate an additional person or persons or an additional address or
addresses for its notices,but notice of a change of address shall only be effective upon receipt.
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13. General.
(a) Assignment/Successors. This Agreement shall be binding upon the
Borrower,the Senior Lender and the Subordinate Lender and shall inure to the benefit of the
respective legal successors and assigns of the Senior Lender and the Subordinate Lender.
(b) No Partnership or Joint Venture. The Senior Lender's permission for the
placement of the Subordinate Loan Documents does not constitute the Senior Lender as a
joint venturer or partner of the Subordinate Lender. Neither party hereto shall hold itself out
as a partner,agent or Affiliate of the other party hereto.
(c) Senior Lender's and Subordinate Lender's Consent. Wherever the
Senior Lender's consent or approval is required by any provision of this Agreement, such
consent or approval may be granted or denied by the Senior Lender in its sole and absolute
discretion, unless otherwise expressly provided in this Agreement. Wherever the
Subordinate Lender's consent or approval is required by any provision of this Agreement,
such consent or approval may be granted or denied by the Subordinate Lender in its sole and
absolute discretion, unless otherwise expressly provided in this Agreement.
(d) Further Assurances. The Subordinate Lender, the Senior Lender and the
Borrower each agree, at the Borrower's expense, to execute and deliver all additional
instruments and/or documents reasonably required by any other party to this Agreement in
order to evidence that the Subordinate Mortgage is subordinate to the lien, covenants and
conditions of the First Mortgage,or to further evidence the intent of this Agreement.
(e) Amendment. This Agreement shall not be amended except by written
instrument signed by all parties hereto.
(t) Governing Law. This Agreement shall be governed by the laws of the State
in which the Property is located(exclusive of choice and conflict of law principles).
(g) Severable Provisions. If any provision of this Agreement shall be invalid or
unenforceable to any extent, then the other provisions of this Agreement, shall not be
affected thereby and shall be enforced to the greatest extent permitted by law.
(h) Term. The term of this Agreement shall commence on the date hereof and
shall continue until the earliest to occur of the following events: (i)the payment of all of the
principal of, interest on and other amounts payable under the First Mortgage Loan
Documents; (ii)the payment of all of the principal of, interest on and other amounts payable
under the Subordinate Loan Documents, other than by reason of payments which the
Subordinate Lender is obligated to remit to the Senior Lender pursuant to Section 4 hereof;
(iii)the acquisition by the Senior Lender of title to the Property pursuant to a foreclosure or
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HOU 408458337
a deed in lieu of foreclosure of, or the exercise of a power of sale contained in, the First
Mortgage; or(iv)the acquisition by the Subordinate Lender of title to the Property pursuant
to a foreclosure or a deed in lieu of foreclosure of, or the exercise of a power of sale
contained in,the Subordinate Mortgage, but only if such acquisition of title does not violate
any of the terms of this Agreement.
(i) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be considered an original for all purposes; provided,
however,that all such counterparts shall together constitute one and the same instrument.
•
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HOU 408458337
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year first written above.
SENIOR LENDER:
WELLS FARGO B N.A., a national banking
association 4
By: / _.
is
'e L.H./ on,
Senior Vice President
THE STATE OF TEXAS §
COUNTY OF`/ §
This instrument was acknowledged before me on this f11 day of
,2016,by Leslie L. Houston, Senior Vice President of WELLS FARGO
BANK,N. , a national banking association, on behalf of said banking association, on behalf of
said banking association.
`o 'ublic,S of •
M •mmission pires: / • e
SIGNATURE PAGE TO SUBORDINATION AND STANDSTILL AGREEMENT(HOME LOAN)
HOU 408468397
SUBORDINATE LENDER:
ATTEST: CORPUS CHRISTI COMMUNITY
IMPROVEMENT CORPORATION("CCCIC")
i"
'I 7
pQ___c4e.c.e.et--HiAt_a-T,. By: A/r/
Rebecca Huerta E. J.F''gton
Secretary Assistant City M.' .ger as Agent of the
General Manager of the CCCIC
APPROVED AS TO FORM:
LthTHIS AtDAY OF , 2016:
Miles Ris ey, CITY A ORN AU tHUK►tc►
/ if Well
Y i a A,•�F • 1I' SECKTAR
STATE OF TEXAS §
§ KNOW ALL BY THESE PRESENTS:
COUNTY OF NUECES §
This instrument was acknowledged before me on this 22 y day of m al , 2016, by
E. Jay Ellington, Assistant City Manager of the Corpus Christi Community Improvement
Corporation , a Texas non-profit corporation, as Agent of the General Manager of the Corpus
Christi Community Improvement Corporation,, oon'�behalf of said corporation.
6 _—elr.,...../4
.wr%:*, CALEB BRA .�"��
MBILA Notary Public, State of Texas
*` Notary Public,State of Texas
My Commission Expires
' �' 09/25/2018
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HOU 408458337
BORROWER:
TG 110 GLENOAK,LP,a Texas limited
partnership
I
By: TO 110 Glenoak;GP,LLC,a Texas limited
liability company,its general partner
By: TG 110,Inc.,a Texas nonprofit corporation,
its sole member
By; ,..------,,774* .
Gilbert M.Piette,
Executive Director
{ THE STATE OF TEXAS §
` . § KNOW ALL MEN BY THESE PRESENTS
COUNTY OF : '1,imitA §�1
BEFORE ME, the undersigned authority, on this day personally appeared Gilbert M.
Piette, Executive Director of TG 110, Inc., a Texas nonprofit corporation, on behalf of said
corporation, sole member of TO 110 Glenoak GP, LLC, a Texas limited liability company,
general partner of TG 110 Glenoak,LP,a Texas limited partnership.
GIVEN UNDER MY HAND AND SEAL OF OFFICE on this the )7 day of
k- ,2016.
6.
Notary Pub rState of Texas
[SEAL]
1-
JEAN ANN PIKE
Notary Public,State of Texas
Ve My Commission Expires
June 04,2019
SIGNATURE PAGE TO SUBORDINATION AND STANDSTILL AGREEMENT(HOME LOAN)
HOU 408488337
,
''
EXHIBIT"A"
Lot One(1),Block A,WALDRON HEIGHTS SUBDIVISION,a subdivision in the City of Corpus Christi,
Texas as shown by map or plat thereof recorded In Volume 37,Page 158,Map Records of Nueces
County,Texas.
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HOU 408458337