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Q5-27-1993 ,ONSTRUCTION LOAN AGREEIV~T Page ~ 3
<br />. Lgan No 700007062 (Continued)
<br />of, or release any hazardous waste or substance on, under, or about any of the properties; and any such activity shall be conducted in compile rce
<br />with ail applicable federal, state, and local laws, regulations, and ordinances, including without limitation those laws, regulations and ordinan :es
<br />described above. Borrower authorizes Lender and its agents to enter upon the properties to make such inspections and tests as Lender r ray
<br />deem appropriate to determine compliance of the properties with this section of the Agreement. Any Inspections or tests made by Lender shall '.be
<br />for Lender's purposes only and shall not be construed to create any responsibility or liability on the part of Lender to Borrower or to any of •rer
<br />person. The representations and warranties contained herein are based on Borrower's due diligence in investigating the properties for hazard rus
<br />waste. eon'ower hereby (a) releases and waives any future claims against Lender for indemnity or contribution in the event Borrower becor res
<br />liable for cleanup or other costs under any such laws, and (b) agrees to indemnify and hold harmless Lender against any and all claims, loss; Ens,
<br />IlabNities, damages, penalties, and expenses which Lender may directly or indirectly sustain or suffer resulting from a breach of this section of :fie
<br />Agreement or as a consequence of any use, generation, manufacture, storage, disposal, release or threatened release occurring prior to
<br />Borrower's ownership or interest in the properties, whether or not the same was or should have been known to Borrower. The provisions of his
<br />section of the Agreement, including the obligation to indemnify, shall survive the payment of the indebtedness and the satisfaction of his
<br />Agreement and shall not be affected by Lender's acquisition of any interest in any of the properties, whether by foreclosure or otherwise.
<br />Project Coals. The total cost for the Project shall not exceed 5797,314.00. The Project costs are true and accurate estimates of the cr. ;;is
<br />necessary to complete the Improvements in a good and workmanlike manner according to the Plans and Specifications presented by Borrowe to
<br />Lender, and Borrower shall take all steps necessary to prevent the actual cost of the Improvements from exceeding the Project costs.
<br />Utility Servkes. All utility services appropriate to the use of the Project after completion of construction are available at the boundaries of he
<br />Property.
<br />Access. The Property is contiguous to publicly dedicated streets, roads, or highways providing access to the Property.
<br />Assessment of Property. The Property is and will continue to be assessed and taxed as an independent parcel by all governmental authorities
<br />Compliance with Governing Authorities. Borrower has examined and is familiar with all the easements, covenants, conditions, restrictic •~s,
<br />reservations, building laws, regulations, zoning ordinances, and federal, state, and local requirements affecting the Project. The Project will al all
<br />times and in aA respects conform to and comply with the requirements of such easements, covenants, conditions, restrictions, reservatio ~~s,
<br />building laws, regulations, zoning ordinances, and federal, state, and local requirements.
<br />Survivd of Representatbn and Warranties. Borrower understands and agrees that Lender is relying upon the above representations ~: nd
<br />warranties in extending Loan Advancers to Borrower. Borrower further agrees that the foregoing representations and warranties shall be
<br />continuing in nature and shall remain in full force and effect until such -time as Borrower's Loan and Note shall be paid in full, or until I •ris
<br />Agreement shall lie terminated in the manner provided above, whichever is the last to occur.
<br />CONDITIONS PRECEDENT TO EACH ADVANCE. Lender's obligation to make the initial Advance and each subsequent Advance under I •ris
<br />Agreement shall be subject to the fulfillment to Lender's satisfaction of all of the conditions set forth in this Agreement.
<br />Specid Conditions to Initid Advance. 102.5 FOUNDATION ENDORSEMENT, COPY OF BUILDING PERMITS AND EVIDENCE :)F
<br />WORKMAN'S COMPENSATION REQUIRED BEFORE HARD COSTS CAN BE DRAWN.
<br />Approvd of Contractors, Subcontractors, and Matertdmen. lender shall gave approved a list of ail contractors employed in connection H ith
<br />the construction of the Improvements, showing the name, address, and telephone number of each contractor, a general description of the net rre
<br />of the worts to be done, the labor and materials to be supplied, the names of materialmen, if known, and the approximate dollar value of the lat::x,
<br />work, or materials with respect to each contractor or materialman. Lender shall have the right to communicate with any person to verify the fFr :ts
<br />disclosed by the list or by any application for any Advance, or fa any other purpose.
<br />Plans, Specifications, and Permits. Lender shall have received and accepted a complete set of Plans and Specifications setting forth ,~I
<br />Improvements for the Project, and Borrower shall have furnished to Lender copies of all permits and requisite approvals of any governmental b~: ciy
<br />necessary for the construction and use of the Project.
<br />Architecture and Construction Contracts. Borrower shall have furnished in form and substance satisfactory to Lender an executed copy of he
<br />Architecture Contract and an executed copy of the Construction Contract.
<br />Support Documents. Borrower shall provide to Lender in form satisfactory to Lender the following support documents for the Loan: Assignmr nt
<br />of Architecture Contract and Completion Guaranty.
<br />Budget and Schedule of Estimated Advances. Lender shall have approved detailed budget and cash flow projections of total Projectcosts a •rd
<br />a schedule of the estimated amount and time of disbursements of each Advance.
<br />Borrower's Authorization. Borrower shall have provided in form and substance satisfactory to Lender property certified resolutions, cl ily
<br />authorizing the execution and delivery of the Loan documents, and the consummation of the Project, and such other authorizations and otl per
<br />documents as Lender in its sole discretion may require.
<br />Bond. If requested by Lender, Borrower shalt have furnished a performance and payment bond in an amount equal to 100% of the amount of 1 ne
<br />Construction Contract, as well as a materialmen's and mechanics' payment bond, with such riders and supplements as Lender may require, ee ::h
<br />in form and substance satisfactory to Lender, naming the general contractor as principal and Lender as an additional obligee. Any requir Erd
<br />bonds and the contracts which they cover must be duly recorded or filed in accordance with California Civil Code Section 3235, if required :~y
<br />Lender.
<br />Survey. If requested by Lender, Borrower shall have furnished to Lender a survey of recent date, prepared and certified by a qualified survey gar
<br />and providing that the Improvements, if constructed in accordance with the Plans and Specifications, shall lie wholly within the boundaries of I •ie
<br />Property without encroachment or violation of any zoning ordinances, building codes or regulations, or setback requirements, together with st.::h
<br />other information as Lender in its sole discretion may require.
<br />Zoning. Borrower shall have furnished evidence satisfactory to Lender that the Property is duly and validly zoned for the constructir ~n,
<br />maintenance, and operation of the Project.
<br />Title Insurance. Borrower shall have provided to Lender an ALTA Lender's extended coverage policy of title insurance with such endorseme its
<br />as Lender may require, issued by a title insurance company acceptable to Lender and in a form, amount, and content satisfactory to Lenci ;lr,
<br />insuring or agreeing to insure that the Mortgage or Deed of Trust on the Property is or will be upon recordation a valid first lien on the Property fr :se
<br />and clear of all defects, liens, encumbrances, and exceptions except those as specifically accepted by Lender in writing. If requested by Lencl :~r,
<br />Borrower shall provide to Lender, at Borrower's expense, a foundation endorsement (CLTA 102.5 or its equivalent) to the title policy upon I •re
<br />completion of each foundation for the Improvements, showing no encroachments, and upon completion an endorsement which insures I •re
<br />lien-free completion of the Improvements (CLTA 101 series, as required by Lender). Specifically, Borrower shall provide to Lender the followi •ig
<br />title insurance endorsements: 100, 101.2, 102.5, 110.9, 111.5, 116.
<br />Insurance. Unless waived by Lender in writing, Borrower shall have delivered to Lender the following insurance policies or evidence thereof: :a)
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