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AGREEMENT FOR DEFERRAL OF
DEVELOPMENT IMPACT FEES
By and Between
CITY OF ATASCADERO
and
H & S Hospitality, LLC
DATED; September 14, 2016
AGREEMENT FOR DEFERRAL OF DEVELOPMENT IMPACT FEES
This Agreement for Deferral of Development Impact Fees ("Agreement"), dated for
reference purposes as first indicated on the cover page, is entered into by and between the CITY
OF ATASCADERO, a California municipal corporation ("City") and H & S HOSPITALITY,
LLC ("Developer") on the following terms and conditions:
RECITALS
A. Developer is presently developing a Project on the Property located within the
City of Atascadero, California. The Developer will need to obtain permits and approvals for the
Project. A standard condition on the issuance of these permits will be the payment of City
imposed Permit and Processing Fees and Development Impact Fees. These Permit and
Processing Fees and Development Impact Fees are generally payable to the City at the time the
project applicant submits an application to the City for these permits and approvals.
B. The City has established a regular program of imposing the payment of specified
Permit and Processing Fees on the construction of new development projects within the City
with respect to the connection of the Project to City utility services as well as inspection and
processing of permits by various City departments. These fees are typically payable to the City
at the time the project applicant submits an application to the City for these permits and
approvals.
C. The City has established a regular program of the payment of specified
Development Impact Fees to offset impacts on public services from new development within the
City. These fees, listed below, are typically payable to the City at the time the project applicant
submits an application to the City for permits and approvals.
D. In certain instances the City acknowledges that it may be to the public's benefit to
defer the payment of Permit and Processing Fees or Development Impact Fees until a specified
time after the issuance of the permit or approval, provided adequate security for the future
payment of the fees is provided. Generally where the project involves a significant capital
investment by the developer and will serve to either encourage further development of an area
where development has been stagnant or where the project will provide a needed service,
convenience, or accommodations to residents or visitors the City Council may find that the
project qualifies to have the payment of Permit and Processing Fees or Development Impact Fees
deferred.
F. Developer has requested that the Project be considered eligible for deferral of
Development Impact Fees. The City Council has found, based on the nature and location of the
Project and the convenience it will provide to residents of the City, that the Project qualifies for a
deferral under the terms and conditions of this Agreement. Developer acknowledges and agrees
that absent this Agreement it would be required to pay all Development Impact Fees at the time
the Developer submits Project-related applications to the City.
G Developer and City acknowledge that the California Prevailing Wage law
normally applies to projects where public funds are used for construction or for the payment of
fees that are mandatory conditions of construction. In this case, City is not paying fees but is
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instead deferring payment of them. Developer is absolutely bound to pay all required fees, but
will be allowed to pay the Development Impact Fees over time, with interest. Developer and
City acknowledge that they have each and separately investigated California Prevailing Wage
Law and have each and separately determined that the City's deferral of the Development Impact
Fees does not constitute a contribution of public funds to the Project, as defined by California
Labor Code Section 1720 and described in non-binding decisions issued by the Department of
Industrial Relations interpreting that Section. Notwithstanding the analysis and determination of
the parties, Developer acknowledges that if the Department of Industrial Relations determines
that the deferral of Development Impact Fees is found to constitute payment of public funds for
the Project then the construction and construction-related activities for the Project would be
subject to the California Prevailing Wage Law and Developer would be required to pay the
general prevailing wage rates of per diem wages and overtime and holiday wages determined by
the Director of the Department of Industrial Relations under Section 1720, et seq., of the
California Labor Code for all covered work performed on the Project.
DEFINED TERMS
"Action" shall mean any suit (whether legal, equitable, or declaratory in nature),
proceeding or hearing (where administrative or judicial), arbitration or mediation (whether
voluntary, court-ordered, binding, or non-binding), or other alternative dispute resolution
process, and the filing, recording, or service of any process, notice, claim, demand, lien, or other
instrument.
"City" shall mean the City of Atascadero, a municipal corporation formed and existing
under the laws of the State of California and any successor-in-interest to the rights, obligations,
and powers of the City.
"Developer" shall mean H & S Hospitality, LLC. The term "Developer" shall also
include all assignees, to the extent permitted under this Agreement, of the rights and obligations
of Developer under this Agreement, and any successor-in-interest to Developer having a legal
and/or equitable interest in the Property.
"Development Impact Fees" shall mean those development impact fees imposed and
levied by the City to recover the cost of planned public facilities and to mitigate impacts of
development on the City as are listed below. The Development Impact Fees include:
1. Law Enforcement Facilities
2. Fire Protection Facilities
3. Fire Aerial Response Vehicle
4. Circulation System
5. Storm Drainage Facilities
6. General Government Facilities
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7. Open Space Acquisition
8. Library Expansion Facilities (Hotels exempt from this fee)
9. Public Meeting Facilities (Hotels exempt from this fee)
10. Parkland (Hotels exempt from this fee)
"Effective Date" shall mean the date the Agreement has been formally approved by the
City Council and executed by the appropriate authorities of the City and Developer.
"Interest Rate" shall mean a fixed rate equal to the quarterly investment yield for the
City's investment portfolio as of June 30, 2016, a rate of 1.175%.
"Litigation Expenses" shall mean all costs and expenses, to the extent such are
reasonable in amount, that are actually and necessarily incurred in good faith by the Prevailing
Party directly related to the Action, including, but not related to, court costs, filing, recording,
and service fees, copying costs, exhibit production costs, special media rental costs, attorneys'
fees, consultant fees, fees for investigators, witness fees (both lay and expert), travel expenses,
deposition and transcript costs, and any other cost or expense reasonably and necessarily
incurred by the prevailing party in good faith and directly related to the Action. Where
attorneys' fees are to be paid by Developer to the City's Iaw firm on behalf of, or in defense of,
City, the rate to be paid shall be the full litigation rate charged by the City's law firm to the City
in accord with the City's contract with that law firm.
"Other Government Fees" shall mean any and all fees levied on the Project by any
government entity other than the City, including but not limited to the State of California and any
of its agencies, the County of San Luis Obispo, any local school district, or any local special
district.
"Payment Period" shall mean a period of Five (5) years from and after the Effective
Date of the Agreement during which Developer will have to pay the amount of the Development
Impact Fees,plus accrued interest,to the City as provided in section 3 [Terms of Payment].
"Permit and Processing Fees" shall mean those fees imposed and levied by the City
with respect to the connection to City utility services as well as inspection, processing and
granting of permits by various City departments.
"Project" shall mean the construction of a new restaurant and banquet room of
approximately 2,850 square foot, on the Property that will be operated by Marston's 101
Restaurant and that is suitable for occupancy and use under Chapter 9 [Planning and Zoning] of
the City's Municipal Cade.
"Property" shall mean that certain parcel of real property commonly known as
Assessor's Parcel Numbers 056-131-023, located at 9006 and 9008 West Front Road, City of
Atascadero, State of California, as more particularly described in the legal description attached
hereto and incorporated herein by reference as Attachment"A".
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OPERATIVE PROVISIONS
NOW, THEREFORE, in consideration of the mutual promises and covenants made by
the parties and contained herein and other consideration, the value and adequacy of which are
hereby acknowledged, the parties agree as follows:
1. Deferral And Payment.
1.1 City's Deferral. The City agrees that Developer may defer payment of the
Development Impact Fees imposed on the Project by City for the Payment Period provided
Developer remains in compliance with the terms, conditions, and covenants of this Agreement.
The parties acknowledge that City normally requires the payment of all Permit and Processing
Fees and Development Impact Fees at the time the project applicant submits an application to the
City for these permits and approvals. In this case, by virtue of this Agreement, the City will
issue permits and approvals for the Project, provided all other requirements for the issuance of
such permits have been met, even though the Developer will not have paid the Development
Impact Fees.
1.2 Developer's Payment.
1.2.1 Permit and Processing Fees. Developer has paid all Permit and Processing
Fees imposed on the application.
1.2.2 _Development Impact Fees. Developer covenants and agrees to timely pay
during the Payment Period the Development Impact Fees, together with all interest accrued
thereon, as provided in this Agreement. Developer acknowledges that Developer's Property will
be encumbered by a lien created by the recording of a second Deed of Trust securing
Developer's payment of the Development Impact Fees.
1.3 Other Government Fees. Developer understands and agrees that the City is
required to collect Other Government Fees that may be imposed on the Project. Developer
agrees to timely pay the Other Government Fees as required by the City. The Other Government
Fees are not subject to deferral pursuant to this Agreement.
1.4 Prevailing Wage Law. California Prevailing Wage law applies to projects where
public funds are used for construction or for the payment of fees that are mandatory conditions of
construction. Pursuant to Section 1.1 [City's Deferral], City will defer payment of Development
Impact Fees, but will not itself pay any fees otherwise required to be paid by Developer.
Developer further agrees to pay interest on the deferred Development Impact Fees at the a rate
equivalent to the rate that the City would receive if the City had the Development Impact Fees in
hand and had invested those moneys in the City's investment portfolio.
1.4.1 Deferral is not Payment of Public Funds. Developer is absolutely bound
to pay all required fees, but pursuant to Section 3 [Terms of Payment] will be allowed to pay
some of them over time, with interest pursuant to Section 3.2 [Payment Over Time]. The parties,
having each researched California Prevailing Wage Law, agree that this deferral is not a payment
of public funds pursuant to California Labor Code Section 1720(b). The deferral is instead a
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market transaction with the Developer paying market rate interest for the opportunity to pay the
Development Impact Fees over time.
1.4.2 Develo er's Agreement to Comply With Prevailing Wage Law.
Notwithstanding the foregoing, Developer acknowledges that if the Department of Industrial
Relations determines that the deferral of Development Impact Fees constitutes the payment of
public funds for the Project then the construction and construction-reIated activities for the
Project would be subject to the Prevailing Wage Law and Developer would be required to pay
the general prevailing wage rates of per diem wages and overtime and holiday wages determined
by the Director of the Department of Industrial Relations under Section 1720, et seq., of the
California Labor Code for all covered work performed on the Project. Without limiting
Developer's obligation to comply with all of the Prevailing Wage Law under the foregoing
scenario, Developer shall at minimum (a) require its contractors and subcontractors to submit
certified copies of payroll records to Developer; (b) maintain complete copies of such certified
payroll records; and (c) make such records available to the City and its designees for inspection
and copying during regular business hours at the Property or at another location within the
City. Under such scenario, Developer shall also obligate Developer's contractors and agents to
comply with all such Prevailing Wage Laws.
1.4.3 Developer's Agreement to Indemnify and Defend City. If the Department
of Industrial Relations determines that the deferral of Development Impact Fees constitutes the
payment of public funds for the Project, Developer further agrees that it shall indemnify and
defend the City from and against any and all present and future liabilities, obligations, orders,
claims, damages, fines, penalties and expenses (including attorneys' fees and costs) arising out of
or in any way connected with Developer's obligation to comply with all Prevailing Wage Laws
with respect to the work of Public Improvements, including all claims that may be made by
contractors, subcontractors or other third parry claimants pursuant to Labor Code Sections 1726
and/or 1781.
2. Development Impact Fees
2.1 Development Impact Fees. The total amount of Development Impact Fees to be
paid for the Project is currently calculated to be $56,500.05. The Developer agrees to pay these
fees as provided in Section 3 [Terms of Payment].
2.2 Refund of Development Impact Fees Paid in Anticipation of this Agreement.
City acknowledges that Developer has remitted payment of$56,500.05 to City in order to obtain
occupancy of the Project and with the understanding that the funds would be returned if this
Agreement were approved by the City Council. Upon such approval, and no less than fifteen(15)
days after execution of this Agreement by representatives of both parties, City shall issue to
Developer a check in the amount of $56,600.05 and Developer shall be obligated to pay the
Development Impact Fees as set forth in Section 3 [Terms of Payment of Development Impact
Fees].
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3. Terms of Pa went of Development Impact Fees
3.1 Absolute Payment Obligation. Developer has the absolute obligation to pay the
entire outstanding balance of the Development Impact Fees. Notwithstanding the provisions of
this Agreement granting Developer permission to pay the Development Impact Fees over time,
such payment over time shall not be deemed to waive all or any portion of Developer's
obligation to pay the entire balance of the Development Impact Fees. Failure to fully pay the
Development Impact Fees as required shall be deemed a Default of this Agreement.
3.2 Payment Over Time. Developer shall pay the entire outstanding balance of the
Development Impact Fees, plus accrued interest, by no later than the last business day of the
Fifth (51h) year from and after the Effective Date of this Agreement. Developer shall make the
following payments:
3.2.1 First Payment. On or before the one-year anniversary of the Effective
Date of this Agreement, in the amount of$11,700.
3.2.2 Second Payment. On or before the two-year anniversary of the Effective
Date of this Agreement, in the amount of$11,700.
3.2.3 Third Payment. On or before the three-year anniversary of the Effective
Date of this Agreement, in the amount of$11,700.
3.2.4 Fourth Payment. On or before the four-year anniversary of the Effective
Date of this Agreement, in the amount of$11,700.
3.2.5 Final Payment. On or before the five-year anniversary of the Effective
Date of this Agreement, in an amount equal to the remaining outstanding principal plus all
interest accrued over the term of the Payment Period, an amount currently estimated to be
$11,716.53.
3.3 Pre-Payment Option. At any time during the Payment Period, Developer may
pay the entire outstanding principal balance of the Development Impact Fees. Pre-payment shall
include all principal amounts owed and all interest accrued as of that date. There shall be no
penalty for pre-payment.
3.4 Interest Accrual and Payment. From and after the Effective Date until the
outstanding principal balance on the Note has been repaid in full, the outstanding balance under
this Agreement and the Promissory Note shall bear interest at the Interest Rate. In no event shall
the amount of interest paid or agreed to be paid to City exceed the maximum amount permissible
under applicable laws.
4. 3.5 Security. As further evidence of Developer's obligation to pay the Development
Impact Fees, Developer shall execute and provide to the City a Promissory Note that is the same
in all material respects to that attached hereto and incorporated herein by reference as
Attachment `B". Developer's payment obligation under the Promissory Note and this
Agreement shall be secured by a Deed of Trust recorded against the Property subordinate only to
a deed of trust securing the Developer's obligations to the Project's construction lender. The
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Deed of Trust shall be the same in all material responses as that attached hereto and incorporated
herein by reference as Attachment"C". Upon request from Developer's construction lender, City
will execute a subordination agreement to subordinate the Deed of Trust to the construction
lender's deed of trust against the Property.
5. General Indemnity.
5.1 General Indemnity. Except as to the sole negligence, active negligence or
willful misconduct of the City, Developer expressly agrees to, and shall, indemnify, defend,
release, and hold the City, and its respective officials, officers, employees, agents, and
contractors harmless from and against any Action, liability, loss, damage, entry,judgment, order,
and lien, which arises out of, or are in any way related to, any act or omission of Developer, or
its officers, directors, employees, agents, or contractors, connected with the performance under
this Agreement, the construction, use, or operation of the Project, notwithstanding that the City
may have benefited therefrom, or any challenge to this Agreement. This Section shall apply to
any acts or omissions, willful misconduct or negligent conduct, whether active or passive, on the
part of Developer's officers, directors, employees, agents and contractors. The City shall not be
responsible for any acts, errors or omissions of any person or entity except the City and its
officers, agents, servants, employees or contractors. The Parties expressly agree that the
obligations of Developer under this Section shall survive the expiration or early termination of
the Agreement.
6. Default And Remedies.
6.1 Default. Either party's failure or unreasonable delay to perform any term or
provision of this Agreement constitutes a Default of this Agreement. In the event of a Default,
the injured party shall give written "Notice of Default" to the defaulting party, specifying the
Default. Delay in giving such notice shall not constitute a waiver of the Default. If the
defaulting party fails to cure the Default within thirty (30) days after receipt of a notice
specifying the Default, or, if the Default is of a nature that cannot be cured within thirty (30)
days, the defaulting party fails to commence to cure the Default within said thirty (30) days and
thereafter diligently prosecute such cure to completion,then the defaulting party shall be liable to
the injured party for any and all damages caused by such Default, unless otherwise provided for
by this Agreement.
6.2 No Waiver. Failure to insist on any one occasion upon strict compliance with
any of the terms, covenants or conditions hereof shall not be deemed a waiver of such term,
covenant or condition, nor shalI any waiver or relinquishment of any rights or powers hereunder
at any one time or more times be deemed a waiver or relinquishment of such other right or power
at any other time or times.
6.3 Legal Actions. In addition to any other rights and remedies any party may
institute a legal action to require the cure of any default and to recover damages for any default,
or to obtain any other remedy consistent with the purpose of this Agreement. The following
provisions shall apply to any such legal action:
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6.3.1 Jurisdiction and Venue. Legal actions must be instituted and maintained
in the Superior Court of the County of San Luis Obispo, State of California, Central Branch,
Civil Division, or if appropriate, in the United States District Court for the Central District of
California. Participant specifically waives any rights provided to it pursuant to California Code
of Civil Procedure §394 and any federal statue or rule of similar effect.
6.3.2 Applicable Law. The laws of the State of California shall govern the
interpretation and enforcement of this Agreement.
6.3.3 Attorney's Fees. In the event either party commences an Action against
the other party which arises out of a Default of, breach of, failure to perform, or that is otherwise
related to, this Agreement, then the Prevailing Party (as defined here) in the Action shall be
entitled to recover its Litigation Expenses from the other party in addition to whatever relief to
which the prevailing party may be entitled. For the purpose of this section, "Prevailing Party"
shall have the meaning ascribed in §1032(a) (4) of the California Code of Civil Procedure.
6.4 Rights and Remedies are Cumulative. The rights and remedies of the Parties
are cumulative, and the exercise by a party of one or more of its rights or remedies shall not
preclude the exercise by it, at the same or different time, of any other rights or remedies for the
same Default or any other Default by another Party.
7. General Provisions.
7.1 No Third Party Beneficiaries. This Agreement is for the sole and exclusive
benefit of the City and Developer. No other parties or entities are intended to be, or shall be
considered, a beneficiary of the performance of any of the parties' obligations under this
Agreement.
7.2 Recitals and Definitions. The Recitals and Definitions set forth at the beginning
of this Agreement are a substantive and integral part of this Agreement and are incorporated by
reference in the Operative Provisions of this Agreement.
7.3 Titles and Captions. Titles and captions are for convenience of reference only
and do not define, describe or limit the scope or the intent of this Agreement or any of its terms.
Reference to section numbers are to sections in this Agreement unless expressly stated otherwise.
7.4 Interpretation. The City and Developer acknowledge that this Agreement is the
product of mutual arms-length negotiation and drafting and each represents and warrants to the
other that it has been represented by legal counsel in the negotiation and drafting of this
Agreement. Accordingly, the rule of construction which provides the ambiguities in a document
shall be construed against the drafter of that document shall have no application to the
interpretation and enforcement of this Agreement. In any action or proceeding to interpret or
enforce this Agreement, the finder of fact may refer to such extrinsic evidence not in direct
conflict with any specific provision of this Agreement to determine and give effect to the
intention of the parties hereto.
7.5 Severability. Each provision, term, condition, covenant, and/or restriction, in
whole and in part, in this Agreement shall be considered severable. In the event any provision,
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term, condition, covenant, and/or restriction, in whole and/or in part, in this Agreement is
declared invalid, unconstitutional, or void for any reason, such provision or part thereof shall be
severed from this Agreement and shall not affect any other provision, term, condition, covenant,
and/or restriction, of this Agreement and the remainder of the Agreement shall continue in full
force and effect.
7.6 Amendments to Agreement. Any amendments to this Agreement must be in
writing and signed by the appropriate authorities of the City and Developer.
7.7 Administration. Following approval of this Agreement by the City's Council,
the City shall exercise its rights, perform its obligations, and otherwise administer this
Agreement through the City Manager. The City Manager shall have the authority to issue
interpretations and to make minor amendments to this Agreement on behalf of the City, provided
such actions do not materially increase the obligations of the City, make a commitment of
additional funds to by paid by, or costs to be incurred by, the City, or result in a discretionary
extension of time in excess of thirty (30) days. All other changes, modifications, and
amendments shall require the prior approval of the City Council.
7.8 Notices, Demands and Communications Between the Parties. Formal notices,
demands and communications between the parties shall be given in writing and personally
served or dispatched by registered or certified mail, postage prepaid, return receipt requested, to
the principal offices of the parties, as designated in this Section, or telefaxed to the facsimile
number listed below followed by dispatch as above described. Such written notices, demands,
and communications may be sent in the same manner to such other addresses as either party may
from time to time designate by mail as provided in this Section. Any such notice shall be
deemed to have been received (i) upon the date personal service is effected, if given by personal
service, (ii) upon the expiration of one (1) business day, if telefaxed, or (iii) upon the expiration
of three (3) business days after mailing, if given by certified mail, return receipt requested,
postage prepaid.
If notice is to be made to the City:
City Manager
City of Atascadero
6500 Palma Avenue
Atascadero, California 93422
If notice is to be made to Developer:
H & S Hospitality, LLC
Attn: Amar Sohi
9010 West Front Road
Atascadero, California 93422
7.9 Computation of Time. The time in which any act is to be done under this
Agreement is computed by excluding the first day and including the last day, unless the last day
is a holiday or Saturday or Sunday, and then that day is also excluded. The term "holiday" shall
mean all holidays as specified in Government Code § 6700 and § 6701. If any act is to be done
by a particular time during a day, that time shall be Pacific Standard Zone time.
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7.10 Authority. The individuals executing this Agreement on behalf of Developer and
the instruments referenced on behalf of Developer represent and warrant that they have the legal
power, right and actual authority to bind Participant to the terms and conditions hereof and
thereof.
7.11 Counterpart Originals. This Agreement may be executed in duplicate originals,
each of which is deemed to be an original.
7.12 Effective date of Agreement. This Agreement shall not become effective until
the date it has been formally approved by the City Council and executed by the appropriate
authorities of the City and Developer.
7.13 Waiver of Actions. Developer, for itself and its contractors, hereby expressly
agrees that City has satisfied its obligations under the Prevailing Wage Laws to identify projects
as being subject to the Prevailing Wage Laws and any other obligations imposed upon the City
under Labor Code Sections 1726 and/or 1781 that are owed to or may be actionable by
Developer and its contractors. Furthermore, Developer, for itself and its contractors hereby
expressly waives any right of action against the City created under Labor Code Sections 1726
and/or 1781, whether known, or unknown, foreseen or unforeseen relating to the Project and/or
this Agreement.
IN� WITNEpSS�WHEREOFF, the parties hereto have executed this Agreement on the day of the-St ` O16.
CITY:
C ATASCAD
Rachelle Rickard
City Manager
ATTEST: _
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Marcia McClure Torgerson
City Clefk
APPROVEDASN i O FORM:
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Brian A. Pierik
City Attorney
DEVELOPER:
H & S Hos itality, LLC
Amarpreet S. Sohi
Owner/Operator
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PROMISSORY NOTE
City of Atascadero, California $56,500.05 SST-1VA , 2016
For valid consideration duly received and hereby acknowledged, the undersigned H & S
Hospitality, LLC, a California limited liability company ("Maker"), promises and agrees to pay
to the order of the City of Atascadero, 6500 Palma Avenue, Atascadero, California 93422, or
holder ("City"), in lawful money of the United States of America, the principal sum of FIFTY
SIX THOUSAND FIVE HUNDRED DOLLARS and five cents ($56,500.05) (the "Principal
Sum"), to be paid in five (5) payments in accordance with the payment schedule appended
hereto and incorporated herein. This Note shall bear interest at the rate of 1.175 percent (1.175%)
per annum, in accordance with the terms the Agreement For Deferral of Development Impact
Fees By and Between the City of Atascadero and H & S Hospitality, LLC dated
�7'EM9eJZ_ I� , 2016 ("Agreement"), which is incorporated herein in full by reference.
Payments shall be applied first to satisfy accrued interest and then to outstanding principal.
Unless otherwise specified in writing by the City, all payments on this Promissory Note
shall be paid to the City, by check, made payable to the order of the City of Atascadero, 6500
Palma Avenue, Atascadero, California 93422.
This Note may be prepaid in full or in part at any time and from time to time without
penalty or premium. Partial prepayments will be applied to the installments due hereunder in the
inverse order of their maturity.
This Note is to be secured by a deed of trust against real property as described in the
Agreement. This Note is not a purchase money note.
Default. The existence or occurrence of any one or more of the following will constitute a
"Default" under this Note:
(a) The failure by Maker to make any payment of principal or interest on this
Note when due and such failure shall have continued for thirty (30) days after notice of
such failure has been provided.
(b) Any breach by Maker of any covenant to which it is bound under this
Note.
(c) Maker shall make an assignment for the benefit of creditors; apply for or
consent to the appointment of a receiver or trustee for itself or such a receiver or trustee
otherwise shall be appointed; or admit in writing its inability to pay its debts as they
mature.
(d) Maker becomes the subject of any bankruptcy or other voluntary or
involuntary proceeding, in or out of court, for the adjustment of debtor-creditor
relationships ("Insolvency Proceeding"), and as to any involuntary Insolvency
Proceeding, it either: (A) is consented to or (B) has not been dismissed within sixty (60)
days.
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Remedies Upon Default. Upon the occurrence of any Default, at the option of the City in
its sole discretion, and without notice or demand of any kind, the entire Principal Sum then
outstanding and all accrued and unpaid interest will become immediately due and payable. Upon
any such acceleration, the Principal Sum shall thereafter bear interest at the maximum legal rate
of ten percent (10%) per annum. Whether or not suit is filed, Maker agrees to pay all attorneys'
fees, costs of collection, costs, and expenses incurred by the City in connection with the
enforcement or collection of this Note.
This Promissory Note has been executed and delivered in and shall be construed in
accordance with and governed by the laws of the State of California and of the United States of
America.
Executed as of the date first written above.
H & S HOSPITALITY, LLC
By.
Amarpreet S. Sohi
Owner/Operator
Payment Schedule
Payment Due Payment Amount
Date
ONE YEAR FROM THE EFFECTIVE DATE $11,700.00
OF THE CERTIFICATE OF OCCUPANCY
TWO YEARS FROM THE EFFECTIVE DATE $11,700.00
OF THE CERTIFICATE OF OCCUPANCY
THREE YEARS FROM THE EFFECTIVE DATE $11,700.00
OF THE CERTIFICATE OF OCCUPANCY
FOUR YEARS FROM THE EFFECTIVE DATE $11,700.00
OF THE CERTIFICATE OF OCCUPANCY
FIVE YEARS FROM THE EFFECTIVE DATE $11,716.53 plus any additional
OF THE CERTIFICATE OF OCCUPANCY accrued interest
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2017002710
Tommy Gong
San Luis Obispo - County Clerk-Recorder
01/18/2017 11:52 Ali
When recorded mail to: CONFORMED COPY ;
City Clerk
Cit of Atascadero Copy of document recorded.
City Has not been compared with original-;-
6500 Palma Avenue
Atascadero, California 93422
No fee for recording pursuant to ,
Government Code Section 27383
DEED OF TRUST WITH ASSIGNMENT OF RENTS
This DEED OF TRUST, made this 14th day of SEPTEMBER 2016, between H &S
Hospitality,LLC, herein called TRUSTOR whose address is 9010 West Front Road,Atascadero, California
92422, FIRST AMERICAN TITLE COMPANY, a California corporation, herein called TRUSTEE, and CITY
OF ATASCADERO,a California municipal corporation, herein called BENEFICIARY.
Trustor irrevocably grants, transfers and assigns to Trustee in Trust, with Power of Sale that property in the
County of San Luis Obispo, State of California,described as follows:
SEE LEGAL DESCRIPTION ATTACHED HERETO
A.P.N.056-131-023
Together with the rents, issues and profits thereof, subject, however, to the right, power and authority
hereinafter given to and conferred upon Beneficiary to collect and apply such rents, issues and profits.
FOR THE PURPOSE OF SECURING (1) payment of the sum of$56,500.05 Dollars with interest thereon
according to the terms of a promissory note or notes of even date herewith made by TRUSTOR, payable to
order of BENEFICIARY, and extensions or renewals thereof; (2) the performance of each agreement of
TRUSTOR incorporated by reference or contained herein or reciting it is so secured; (3) payment of
additional sums and interest thereon which may hereafter be loaned to Trustor, or its successors or assigns,
when evidenced by a promissory note or notes reciting that they are secured by this Deed of Trust.
A. To protect the security of this Deed of Trust, and with respect to the property above described,
Trustor agrees:
(1) To keep said property in good condition and repair; not to remove or demolish any-building
thereon; to complete or restore promptly and in good and workmanlike manner any building which may be
constructed, damaged or destroyed thereon and to pay when due all claims for labor performed and
materials furnished therefor; to comply with all laws affecting said property or requiring any alterations or
improvements to be made thereon; not to commit or permit waste thereof; not to commit, suffer or permit
any act upon said property in violation of the law; to cultivate, irrigate, fertilize, fumigate, prune and do all
other acts which from the character or use of said property may be reasonably necessary, the specific
enumerations herein not excluding the general.
(2) To provide, maintain and deliver to Beneficiary fire insurance satisfactory to and with loss
payable to Beneficiary. The amount collected under any fire or other insurance policy may be applied by
Beneficiary upon any indebtedness secured hereby and in such order as beneficiary may determine, or at
option of Beneficiary the entire amount so collected or any part thereof may be released to Trustor. Such
application or release shall not cure or waive any default or notice of default hereunder or invalidate any act
done pursuant to such notice.
(3) To appear in and defend any action or proceeding purporting,to affect the security hereof or
the rights or powers of Beneficiary or Trustee; and to pay all costs and expenses, including cost of evidence
of title and attorney's fees in a reasonable sum, in any action or proceeding in which Beneficiary or Trustee
may appear, and in any suit brought by Beneficiary to foreclose this Deed of Trust.
(4) To pay: at least ten days before delinquency all taxes and assessments affecting said
property, including assessments on appurtenant water stock; when due, all encumbrances, charges and
liens, with interest, on said property or any part thereof, which appear to be prior or superior hereto; all
costs,fees and expenses of this Trust.
Should Trustor fail to make any payment or to do any act as herein provided, then Beneficiary or
Trustee, but without obligation so to do and without notice to or demand upon Trustor and without releasing
Trustor from any obligation hereof, may: make or do the same in such manner and to such extent as either
may deem necessary to protect the security hereof, Beneficiary or Trustee being authorized to enter upon
said property for such purposes; appear in and defend any action or proceeding purporting to affect the
security hereof or the rights or powers of Beneficiary or Trustee; pay, purchase, contest or compromise any
encumbrance, charge, or lien which in the judgment of either appears to be prior or superior hereto; and, in
exercising any such powers, pay necessary expenses, employ counsel and pay his or her reasonable fees.
(5) To pay immediately and without demand all sums so expended by Beneficiary or Trustee,
with interest from date of expenditure at the amount allowed by law in effect at the date hereof, and to pay
for any statement provided for by law in effect at the date hereof regarding the obligation secured hereby,
any amount demanded by the Beneficiary not to exceed the maximum allowed by law at the time when said
statement is demanded.
B. It is mutually agreed:
(1) That any award of damages in connection with any condemnation for public use of or injury
to said property or any part thereof is hereby assigned and shall be.paid to Beneficiary who may apply or
release such moneys received by him or her in the same manner and with the same effect as above
provided for disposition or proceeds of fire or other insurance.
(2) That by accepting payment of any sum secured hereby after its due date, Beneficiary does
not waive his or her right either to require prompt payment when due of all other sums so secured or to
declare default for failure so to pay.
(3) That at any time or from time to time, without liability therefor and without notice, upon
written request of Beneficiary and presentation of this Deed and said note for endorsement, and without
affecting the personal liability or any person for payment of the indebtedness secured hereby,Trustee may:
reconvey any part of said property; consent to making of any map or plat thereof; join in granting any
easement thereon; or join in any extension agreement or any agreement subordinating the lien or charge
hereof.
(4) That upon written request of beneficiary stating that all sums secured hereby have been
paid, and upon surrender of this Deed and said note to Trustee for cancellation and retention or other
disposition as Trustee in its sole discretion may choose and upon payment of its fees, Trustee shall
reconvey, without warranty, the property then held hereunder. The recitals in such reconveyance of any
matters or facts shall be conclusive proof of the truthfulness thereof. The Grantee in such reconveyance
may be described as"the person or persons legally entitled thereto."
(5) That as additional security, Trustor hereby gives to and confers upon Beneficiary the right,
power and authority, during the continuance of these Trusts, to collect the rents, issues and profits of said
property, reserving unto Trustor the right, prior to any default by Trustor in payment of any indebtedness
secured hereby or in performance of any agreement hereunder,to collect and retain such rents, issues and
profits as they become due and payable. Upon any such default, Beneficiary may at any time without
notice, either in person, by agent, or by a receiver to be appointed by a court, and without regard to the
adequacy of any security for the indebtedness hereby secured, enter upon and take possession of said
property or any part thereof, in his or her own name sue for or otherwise collect such rents, issues, and
profits, including those past due and unpaid, and apply the same, less costs and expenses of operation and
collection, including reasonable attorney's fees, upon any indebtedness secured hereby, and in such order
as Beneficiary may determine. The entering upon and taking possession of said property, the collection of
such rents, issues and profits and the application thereof as aforesaid,shall not cure or waive any default or
notice of default hereunder or invalidate any act done pursuant to such notice.
(6) That upon default by Trustor in payment of any indebtedness secured hereby or in
performance of any agreement hereunder, Beneficiary may declare all sums secured hereby immediately
due and payable by delivery to Trustee of written declaration of default and demand for sale and of written
i
notice of default and of election to cause to be sold said property, which notice Trustee shall cause to be
filed for record. Beneficiary also shall deposit with Trustee this Deed, said note and all documents
evidencing expenditures secured hereby.
After the lapse of such time as may then be required by law following the recordation of said notice
of default, and notice of sale having been given as then required by law, Trustee without demand on
Trustor, shall sell said property at the time and place fixed by it in said notice of sale, either as a whole or in
separate parcels, and in such order as it may determine, at public auction to the highest bidder for cash in
lawful money of the United States, payable at time of sale. Trustee may postpone sale of all or any portion
of said property by public announcement at such time and place of sale, and from time to time thereafter
may postpone such sale by public announcement at the time fixed by the preceding postponement. Trustee
shall deliver to such purchaser its deed conveying the property so sold, but without any covenant or
warranty, express or implied. The recitals in such deed of any matters or facts shall be conclusive proof of
the truthfulness thereof. Any person, including Trustor, Trustee, or Beneficiary as hereinafter defined, may
purchase at such sale.
After deducting all costs, fees and expenses of Trustee and of this Trust, including cost of evidence
of title in connection with sale, Trustee shall apply the proceeds of sale to payment of: all sums expanded
under the terms hereof, not then repaid, with accrued interest at the amount allowed by law in effect at the
date hereof; all other sums then secured hereby;and the remainder, if any, to the person or persons legally
entitled thereto.
(7) Beneficiary, or any successor in ownership of any indebtedness secured hereby, may from
time to time, by instrument in writing, substitute a successor of successors to any Trustee named herein or
acting hereunder, which instrument, executed by the Beneficiary and duly acknowledged and recorded in
the office of the recorder of the county or counties where said property is situated, 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 Trustor, Trustee and Beneficiary hereunder, the book and page where this Deed is
recorded and the name and address of the new Trustee.
(8) That this Deed applies tQ, inures to the benefit of, and binds all parties hereto, their heirs,
legatees, devisees, administrators, executors, successors, and assigns. The term Beneficiary shall mean
the owner and holder,including pledgees, of the note secured hereby, whether or not named as Beneficiary
herein. In this Deed, whenever the context so requires, the masculine gender includes the feminine and/or
the neuter, and the singular number includes the plural.
(9) The Trustee accepts this Trust when this Deed, duly executed and acknowledged, is made
a public record as provided by law. Trustee is not obliged to notify any party hereto of pending sale under
any other Deed of Trust or of any action or proceeding in which Trustor, Beneficiary or Trustee shall be a
party unless brought by Trustee.
Beneficiary may charge for a statement regarding the obligation secured hereby, provided the charge
thereof does not exceed the maximum allowed by laws.
The undersigned Trustor, requests that a copy of any notice of default and any notice of sale hereunder be
mailed to him or her at his or her address hereinbefore set forth.
H & S Hospitatlit , LLC
Amar Solar' f
Trustor
A notary public or other officer completing this certificate verifies only the identity of the individual
who signed the document to which this certificate is attached, and not the truthfulness, accuracy,
or validity of that document.
State of1 LCh i �-
County of Y1 �Jl�t,i� �, Y
On It&<be_ K ,00A before me, 6� Ca✓" - nAAr-A, b C(here insert
name ,and title of the officer), personally appeared r _6C>A U who
proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed
to the within instrument and acknowledged to me that he/she/they executed the same in-his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the
entity upon behalf of which the person(s)acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
-paragraph is true and correct.
WITNESS my hand }nd official seal.
/ V
Signature (Seal)
LISA CAVA
COmmisslon 2030435
Z . Notary Public:-Calilornis
San Luis Obispo County
My COMM.EXPIMS Jun 22 2017
a
Legal Description
Lot 3, as created by subdivision map Tract 2621 recorded April 4, 2007 in Book 29, Pages 66
through 74 of Maps in the Official Records of San Luis Obispo County, California.
t ITEM NUMBER: A-6
DATE: 09113/16
ATTACHMENT: 3
DO NOT RECORD
REQUEST FOR FULL RECONVEYANCE
To First American Title Company
The undersigned is the legal owner and holder of the note or notes, and of all other indebtedness
secured by the foregoing Deed of Trust. Said note or notes, together with all other indebtedness secured
by said Deed of Trust have been fully paid and satisfied, and you are hereby requested and directed, on
payment to you of any sums owning to you under the terms of said Deed of Trust, to cancel said note or
notes above mentioned, and all other evidence of indebtedness secured by said Deed of Trust delivered
to you herewith, together with the said Deed of Trust, and to reconvey, without warranty, to the parties
designated by the terms of said Deed of Trust, all the estate now held by you under the same.
Dated
Please mail Deed of Trust, Note(s)and Reconveyance to:
Do not lose or destroy this Deed of Trust OR THE NOTE which it secures. Both must be delivered
to the Trustee for cancellation before reconveyance will be made.
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