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This document package contains the following documents in order.
USE THE HYPERLINKS BELOW TO ACCESS EACH DOCUMENT.
1.
2.
3.
4.
5.
6.
Modification and Assumption Agreement (Off-Record)
Modification and Assumption Agreement (Recorded)
LLC Borrowing Authorization
Exceptions to Non-Recourse Guaranty
Conditional Waiver of Imposition Deposits
Assumption Fee Agreement
Loan Modification and Assumption Documents
Lender:
DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee, for the registered
holders of Impac Secured Assets Corp.
Mortgage Pass-Through Certificates Series 2006-2
Original Borrower:
RICHARD D. SMITH and SYLVIA TORRES SMITH
Assuming Borrower:
KR CAPITAL, LLC
For Property Located At:
1825 East Don Carlos Avenue, Tempe, Arizona 85281
Loan No. 5500002856
Documents Dated: March 31, 2011
ASSUMPTION AGREEMENT AND AGREEMENT TO MODIFY PROMISSORY NOTE
AND DEED OF TRUST
This Assumption Agreement and Agreement to Modify Promissory Note and Deed of Trust (“Agreement”), dated for
reference purposes only as of March 31, 2011, is entered into by and between DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Trustee, for the registered holders of Impac Secured Assets Corp. Mortgage Pass-Through Certificates
Series 2006-2 (“Lender”), KR CAPITAL, LLC, a California limited liability company ("Assuming Borrower") and MARK
KANTER and CHRIS RENARD (jointly and severally referred to herein in the singular as "Guarantor") with reference to the
following facts:
A.
WHEREAS, IMPAC COMMERCIAL CAPITAL CORPORATION, a California corporation (formerly known
as IMPAC MULTIFAMILY CAPITAL CORPORATION, a California corporation) (“Impac”) has made a loan to RICHARD D.
SMITH and SYLVIA TORRES SMITH (jointly and severally referred to herein in the singular as "Original Borrower") in the
original principal amount of FIVE HUNDRED FORTY THOUSAND AND 00/100 DOLLARS (US $540,000.00) ("Loan"), which
Loan was evidenced by a Promissory Note ("Note") dated March 9, 2006, which Note is secured by a Deed of Trust,
Assignment of Rents, Security Agreement and Fixture Filing dated March 9, 2006, and recorded on March 21, 2006, as
Instrument No. 20060379843, of Official Records, Maricopa County, Arizona (the "Mortgage”), which Mortgage encumbers
certain property located in said county described in Exhibit "A" hereto ("Mortgaged Property"). The term “Loan Documents”
and all other capitalized terms used and not otherwise defined herein shall have the meaning set forth in the Mortgage or the
Note. This Agreement and all other documents executed by Assuming Borrower in connection with this modification are part of
the Loan Documents.
B.
WHEREAS, said Mortgage has been subsequently assigned and transferred to Lender, which assignment is
evidenced by a recorded (or to be recorded) assignment of deed of trust. Lender is the current holder of said Note, Mortgage
and other Loan Documents.
C.
WHEREAS, Assuming Borrower and Lender desire to modify said Note and Mortgage subject to the
conditions set forth below.
D.
WHEREAS, Assuming Borrower has requested Lender's consent (as required by the Mortgage) to the
transfer of said real property to Assuming Borrower and the assumption by Assuming Borrower of all of Original Borrower's
obligations under the Note and Mortgage, as modified herein.
NOW, THEREFORE, in consideration of the foregoing premises and other valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1.
Subject to satisfaction of all conditions set forth herein including recordation of the separate Assumption
Agreement and Amendment to Deed of Trust (“Recorded Amendment”), the Note is hereby amended as follows:
1.1
Effective on the date of transfer of title of the Mortgaged Property to Assuming Borrower, the
outstanding principal balance of the Note shall be reduced to TWO HUNDRED SIXTY THOUSAND AND 00/100 DOLLARS (US
$260,000.00). Said principal balance includes the sum of $35,000.00 for deferred maintenance and rent stabilization costs
associated with the Mortgaged Property, which amount shall be held back and disbursed by Lender to a non-interest bearing
book entry account (the “Holdback Account”) with Lender. Notwithstanding the holdback of funds in the Holdback Account, the
entire loan amount of $260,000.00 shall be deemed to be disbursed to Assuming Borrower and interest shall accrue on said
entire amount. Assuming Borrower grants to Lender a security interest in the Holdback Account as additional collateral for the
Loan. Upon recordation of the Recorded Amendment, Lender shall disburse to Assuming Borrower $20,000.00 from the
Holdback Account. Thereafter, during the period beginning on June 1, 2011 and ending on July 31, 2011, Assuming Borrower
may submit to Lender two (2) additional written requests for disbursement of funds from the Holdback Account in an amount not
to exceed $7,500.00 per request (the two (2) draw requests plus the $20,000.00 disbursed upon recordation of the Recorded
Amendment shall total no more than $35,000.00). Each draw request shall be accompanied by supporting documentation,
current rent roll and operating statement, digital photos of work completed along with signed and dated Assuming Borrower’s
wiring instructions on Assuming Borrower’s letterhead, indicating to Lender’s satisfaction that Assuming Borrower has incurred
costs for rehabilitation of the Mortgaged Property. Upon approval by Lender of such written requests and supporting
Modification and Assumption Agreement (Off-Record)
Loan No.: 5500002856
documentation, provided no Event of Default then exists, Lender shall disburse the requested amount to Assuming Borrower.
Assuming Borrower shall execute such additional documentation as may be requested by Lender to establish, maintain and
request disbursement from the Holdback Account.
1.2
From and after May 1, 2011 (the “Effective Date”), Section 3(b)(i) of the Note is hereby deleted in
its entirety and replaced with the following:
“(i)
Interest Rate. Commencing May 1, 2011, the interest rate under the Note shall be
4 percent (4%) per annum to and excluding May 1, 2014. Commencing May 1, 2014, the interest rate under the Note
shall increase to 5 percent (5%) per annum to and excluding May 1, 2021. Thereafter, the interest rate the Borrower
will pay may change in accordance with this Section 3(b).”
1.3
From and after the Effective Date, Section 3(b)(ii) of the Note is hereby deleted in its entirety and
replaced with the following:
“(ii)
Interest Rate Changes. The interest rate the Borrower will pay may change on
May 1, 2021 and on that day of the month every sixth (6th) month thereafter. Each date on which the interest rate
could change is called an “Interest Change Date.” Before each Interest Change Date, the Lender will calculate the
Borrower’s new interest rate by adding 3.0 percent (3.0%) to the Current Index. The Lender will then round the result
of this addition to the nearest one-eighth of one percent (0.125%). Subject to the limits stated in Section 3(b)(iv) below,
this rounded amount will be the new interest rate until the next Interest Change Date.”
1.4
From and after the Effective Date, Section 3(b)(iv) of the Note is hereby deleted in its entirety and
replaced with the following:
“(iv)
Limits on Interest Rate Changes. The interest rate Borrower is required to pay
commencing on the May 1, 2021 Interest Change Date shall not be greater than 8 percent (8%) per annum nor less
than 5 percent (5%) per annum. Thereafter, the Borrower’s interest rate will never be increased or decreased on any
single Interest Change Date by more than one percent (1.0%) from the rate of interest previously in effect.
Throughout the remaining term of this Note, the Borrower’s interest rate will never be greater than 10 percent (10%)
per annum nor less than 5 percent (5%) per annum.”
1.5
From and after the Effective Date, Section 3(c) of the Note is hereby deleted in its entirety and
replaced with the following:
“(c)
Payments. Principal and interest shall be paid as follows:
(i)
Interest Only Payments. Monthly interest only payments shall be due and payable
commencing on June 1, 2011, and on the first day of every calendar month thereafter through and including
May 1, 2016.
(ii)
Monthly Principal and Interest Payments. Monthly payments of principal and interest
shall be due and payable commencing on June 1, 2016, and on the same day of every calendar month thereafter until
this Note is fully repaid. The amount of the initial monthly payment of principal and interest commencing on
June 1, 2016 shall be in the amount that would be sufficient to repay the outstanding principal balance of this Note as
of May 1, 2016 in full on the Amortization Date in substantially equal monthly payments calculated on the basis of a
360-day year consisting of twelve 30-day months ("30/360") (not on an Actual/360 basis). For purposes of this Section
3, the term “Amortization Date” shall mean May 1, 2046. Although a fixed (subject to adjustment) monthly installment
of principal and interest is required to be paid by Borrower, the amount of each installment attributable to principal and
the amount attributable to interest will vary based upon the number of days in the month for which such installment is
paid. Each monthly installment received by Lender will first be applied to pay in full interest due for the month, and the
balance of the monthly installment paid by Borrower will be credited to principal.
(iii)
Change in Monthly Payments. Commencing with the payment due June 1, 2021, the
monthly payments shall change each time the interest rate changes pursuant to Section 3(b) of this Note. Changes in
monthly payments will reflect changes in the unpaid principal of the loan and in the interest rate. Lender will determine
the amount of the new monthly payment in an amount that would be sufficient to repay the unpaid principal balance of
this Note as of the applicable Interest Change Date in full on the April 1, 2036 Maturity Date (not the Amortization
Date) at the new interest rate in substantially equal monthly payments calculated on a 30/360 (not Actual/360) basis.”
Modification and Assumption Agreement (Off-Record)
Page 2
1.6
From and after the Effective Date, Section 9 of the Note is hereby deleted in its entirety and
replaced with the following:
“9.
Limits on Personal Liability.
(a)
Except as otherwise provided in this Section 9, Borrower shall have no personal liability
under this Note, the Security Instrument or any other Loan Document for the repayment of the Indebtedness or for the
performance of any other obligations of Borrower under the Loan Documents, and Lender's only recourse for the
satisfaction of the Indebtedness and the performance of such obligations shall be Lender's exercise of its rights and
remedies with respect to the Mortgaged Property and any other collateral held by Lender as security for the
Indebtedness. This limitation on Borrower's liability shall not limit or impair Lender's enforcement of its rights against
any guarantor of the Indebtedness or any guarantor of any obligations of Borrower.
(b)
Borrower shall be personally liable to Lender for the repayment of a portion of the
Indebtedness equal to any loss or damage suffered by Lender as a result of any of the following matters:
(1)
Failure of Borrower to pay to Lender upon demand after an Event of Default all
Rents to which Lender is entitled under Section 3(a) of the Security Instrument and the amount of
all security deposits collected by Borrower from tenants of the Mortgaged Property;
(2)
Failure of Borrower to apply all insurance proceeds and condemnation
proceeds as required by the Security Instrument;
(3)
Any damage to the Mortgaged Property caused by the willful, wanton or
tortious act or omission of Borrower; and
(4)
Failure to apply Rents, first, to the payment of reasonable operating expenses
and then to amounts (“Debt Service Amounts”) payable under this Note, the Security Instrument or
any other Loan Document (except that Borrower will not be personally liable under this paragraph
(i) to the extent that Borrower lacks the legal right to direct the disbursement of such sums because
of a bankruptcy, receivership or similar judicial proceeding, (ii) with respect to Rents that are
distributed to Borrower or its principals in any calendar year if Borrower has paid all operating
expenses and Debt Service Amounts for that calendar year, and (iii) with respect to Rents that are
distributed to Borrower or its principals more than twelve (12) months prior to occurrence of any
Event of Default that is the subject of judicial or non-judicial foreclosure proceedings against
Borrower).
(c)
For purposes of determining Borrower's personal liability under this Section 9, all
payments made by Borrower or any guarantor of this Note with respect to the Indebtedness and all amounts received
by Lender from the enforcement of its rights under the Security Instrument and the other Loan Documents shall be
applied first to the portion of the Indebtedness for which Borrower has no personal liability.”
1.7
From and after the Effective Date, Section 10(f) of the Note is hereby deleted in its entirety and
replaced with the following:
“(f)
Any prepayment premium payable under this Section 10 shall be computed as follows:
(i)
If the prepayment is made between May 1, 2011 and May 1, 2016 (the
"Prepayment Premium Period"), the prepayment premium shall be as follows:
(A)
If prepayment is made from May 1, 2011 through and including May 1, 2013,
the prepayment premium shall be equal to three percent (3%) of the principal amount being
prepaid;
(B)
If prepayment is made from May 2, 2013 through and including May 1, 2015,
the prepayment premium shall be equal to two percent (2%) of the principal amount being
prepaid; and
(C)
If prepayment is made from May 2, 2015 through and including May 1, 2016,
the prepayment premium shall be equal to one percent (1%) of the principal amount being
prepaid.
(ii)
If the prepayment is made after the expiration of the Prepayment Premium Period, there
shall be no prepayment premium due.”
2.
From and after the Effective Date, Section 6 of the Mortgage is hereby deleted in its entirety and replaced
with the following:
Modification and Assumption Agreement (Off-Record)
Page 3
“6.
EXCULPATION. Borrower’s personal liability for payment of the Indebtedness and for
performance of the other obligations to be performed by it under this Instrument is limited in the manner, and to the
extent, provided in the Note.”
3.
Assuming Borrower shall provide Lender at least ten (10) days prior written notice (with proof of delivery)
before listing the Mortgaged Property for sale. Said written notice shall be accompanied by a copy of the proposed listing
agreement, which shall be subject to Lender's prior approval in Lender's discretion. Any such proposed listing agreement shall
be deemed approved by Lender unless Lender gives Assuming Borrower written notice of disapproval within ten (10) days after
receipt of Assuming Borrower's notice. Assuming Borrower shall provide a copy of any signed listing agreement to Lender
within ten (10) days of execution.
4.
Assuming Borrower assumes and promises to pay said Note and all extensions and renewals thereof.
5.
Assuming Borrower agrees to pay all Taxes and insurance premiums and any other sums that may become
due and payable under the provisions of said Mortgage and other Loan Documents. Concurrently herewith, Assuming Borrower
and Lender shall enter into an agreement providing for the conditional waiver of Imposition Deposits for Taxes and insurance
premiums.
6.
Assuming Borrower assumes and agrees to comply with each and all of the terms of said Note, Mortgage
and all other Loan Documents, whether recited therein or incorporated therein by reference.
7.
Assuming Borrower may be considered as a substitute obligor in said Note, Mortgage and other Loan
Documents, the same as if said instruments had been executed by the undersigned instead of Original Borrower.
8.
Assuming Borrower waives the right to require the holder of said Note, Mortgage and other Loan Documents
to proceed against Original Borrower or to pursue any other remedy in the holder's power. Assuming Borrower acknowledges
and consents to the release of liability of Original Borrower as set forth herein.
9.
Lender's consent to the transfer to Assuming Borrower shall not be construed as a consent to any
subsequent transfer. The transfer and assumption provided for herein is in addition to (and does not exhaust) the one-time
transfer provision of Section 21(f) of the Mortgage. Upon the satisfaction of all conditions herein (including without limitation
Section 11 of this Agreement), Original Borrower shall be released from liability under the Note, Mortgage and other Loan
Documents.
10.
Prior to the recordation of the Recorded Amendment, Assuming Borrower shall pay a non-refundable
assumption/transfer fee as set forth in a separate written agreement entered into by and between Assuming Borrower and
Lender of even date herewith (the “Assumption Fee Agreement”). Failure to pay the assumption/transfer fee as provided in the
Assumption Fee Agreement shall constitute an Event of Default.
11.
As a condition to Lender’s consent to the transfer of the Mortgaged Property to Assuming Borrower, the
effectiveness of the modification herein, and the release from liability of Original Borrower, Original Borrower shall pay a nonrefundable novation/release of liability/settlement fee (“Novation Fee”), as set forth in a separate written agreement entered into
by and between Original Borrower and Lender of even date herewith (the “Novation Fee and Deficiency Settlement and
Release Agreement”).
12.
Assuming Borrower shall pay for and provide either (a) a new ALTA extended coverage loan policy of title
insurance in form and content acceptable to Lender and subject to no exceptions to title other than those shown on Lender’s
original title policy and such other exceptions as Lender may approve in its sole and absolute discretion, or (b) such
endorsement(s) to Lender’s policy of title insurance for the Loan as required by Lender in Lender’s sole discretion and in such
form as Lender may require, insuring the continued first lien priority of the Mortgage as presently insured in said policy, except
for non-delinquent taxes and such other exceptions as Lender may approve in its sole and absolute discretion.
13.
Assuming Borrower hereby agrees, certifies, warrants and represents to Lender that as of this date:
Modification and Assumption Agreement (Off-Record)
Page 4
13.1
Assuming Borrower is a duly organized, validly existing limited liability company, in good
standing under the laws of the State of California, and is qualified to do business under the laws of the State of Arizona.
Assuming Borrower is not in violation of any Federal or State laws relating to its structure, including, but not limited to, Federal
securities laws, blue sky laws, and other laws, or the rules or regulations of the Securities and Exchange Commission.
Assuming Borrower has all requisite power and authority to enter into all documents required in connection with the above
described transaction and to carry out the obligations of Assuming Borrower contemplated by the Loan Documents and to own
all of the Mortgaged Property.
13.2
That the person(s) executing this Agreement on behalf of Assuming Borrower have all necessary
power and authority to execute and deliver this Agreement for, on behalf of, and in the name of such Assuming Borrower.
13.3
As of the date hereof, there are no setoffs, defenses or counterclaims to the payment of the
indebtedness evidenced by the Note, and Assuming Borrower hereby agrees that if any such defense to the payment of such
indebtedness should hereafter exist against Lender, the same will not be raised against Lender.
13.4
Assuming Borrower owns, or will own, fee simple title to all of the Mortgaged Property; the
Mortgage creates the lien and security it purports to create and upon the execution of this Agreement is a valid and binding
obligation of Assuming Borrower enforceable against Assuming Borrower and the Mortgaged Property in accordance with its
terms; and the Note represents a valid and binding obligation of Assuming Borrower enforceable in accordance with its terms.
13.5
There is not pending against Assuming Borrower or any principal of Assuming Borrower any
petition in bankruptcy, whether voluntary or otherwise, any assignment for the benefit of creditors, any petition seeking
reorganization, liquidation or arrangement under the bankruptcy laws of the United States or of any State thereof, or any other
action brought under the aforesaid bankruptcy laws; there are no law suits or legal proceedings pending or to the best of the
Assuming Borrower’s knowledge threatened in any court or before any governmental agency involving Assuming Borrower, its
principals or the Mortgaged Property, nor are there any judgments outstanding against Assuming Borrower, its principals and the
financial condition of Assuming Borrower as of the date hereof has not adversely changed from the financial condition as
indicated by the financial statements furnished to Lender and said financial statements are substantially true and accurate as of
the date hereof.
13.6
To the best of the Assuming Borrower's knowledge, neither Assuming Borrower nor its principals
are engaged or have committed any act or engaged in any other pattern of actions, the potential results of which might include
forfeiture of Assuming Borrower’s interest in the Mortgaged Property.
13.7
Assuming Borrower is acting in this loan for its own account for commercial purposes and will
receive and apply the loan proceeds for its own account and not as an agent or trustee for others.
13.8
To the best of the Assuming Borrower’s knowledge no part of the Mortgaged Property or the
improvements located thereon have been damaged and not repaired to Lender’s satisfaction, nor taken in any condemnation or
other similar proceeding, nor is any such proceeding pending or threatened.
13.9
To the best of the Assuming Borrower’s knowledge the improvements located on the Mortgaged
Property have been completed in accordance with the plans and specifications and all recommendations of the soils engineer,
including any grading, seeding, landscaping and all other on-site and off-site improvements relating to the operation of the
Mortgaged Property; direct connection has been made from the Mortgaged Property to abutting public water, sewer, gas,
electric, telephone and all other facilities necessary to serve the Mortgaged Property for its intended use; the improvements are
ready for occupancy; and the original building permit, unconditional certificates of occupancy and all other consents and
approvals of all governmental authorities having jurisdiction over the Mortgaged Property have been issued, evidencing
compliance with all zoning, building and other laws and regulations applicable to the Mortgaged Property and the improvements
located thereon.
13.10
This Agreement is given by Assuming Borrower to induce Lender to consent to the transfer of the
Mortgaged Property to Assuming Borrower, with the knowledge that Lender will rely upon the truth of the statements made
herein.
Modification and Assumption Agreement (Off-Record)
Page 5
13.11
To the best of the Assuming Borrower’s knowledge the Mortgaged Property is not in violation of
any federal, state or local law, ordinance or regulation relating to industrial hygiene or to environmental conditions in, on, under
or about the Mortgaged Property including but not limited to soil and groundwater conditions. Neither Assuming Borrower nor, to
the best of Assuming Borrower’s knowledge, any third party has used, generated, manufactured, stored or disposed of in, on,
under or about the Mortgaged Property or transported to or from the Mortgaged Property any hazardous materials.
13.12
Assuming Borrower’s organizational documents have not been amended or altered (except for
such amendments as have been provided to Lender) and are in full force and effect as of the date hereof. Notwithstanding the
provisions of the original Note and Mortgage or any organizational document or operating agreement of Assuming Borrower
regarding transfers of equity interests in Assuming Borrower, Assuming Borrower acknowledges that the terms, conditions and
restrictions regarding such transfers contained in the Mortgage shall govern.
13.13
The improvements located on the Mortgaged Property are either exempt from the accessibility
requirements of the Americans with Disabilities Act, 42 U.S.C.A. § 12101 et. seq. (hereinafter called the “ADA”), or, if not
exempt, said improvements are accessible to and usable by persons with disabilities and complies (and shall, at all times during
the term of the subject loan be maintained in compliance) with the ADA, and the regulations thereunder promulgated by the
U.S. Architectural and Transportation Barriers Compliance Board (36 C.F.R. § 1191 et. seq.) and by the U.S. Department of
Justice (28 C.F.R. Part 36), including without limitation the ADA Accessibility Guidelines for Buildings and Facilities attached as
an Appendix to said regulations. The Mortgaged Property is in compliance with the Fair Housing Amendments Act of 1998, as
amended, as well as any other state or local laws and ordinances related to handicapped access.
13.14
The execution, delivery and performance of the obligations imposed on Assuming Borrower under
the Loan Documents will not cause Assuming Borrower to be in default under the provisions of any agreement, judgment or
order to which Assuming Borrower is a party or by which Assuming Borrower is bound.
13.15
To the best of the Assuming Borrower’s knowledge all parties furnishing labor and materials have
been paid in full and, there are no mechanics', laborers' or materialmen's liens or claims outstanding for work, labor or materials
affecting the Mortgaged Property, whether prior to, equal with or subordinate to the lien of the Mortgage.
14.
As a condition to Lender's approval, Assuming Borrower shall furnish to Lender an Exceptions to NonRecourse Guaranty executed by Guarantor, in form and content acceptable to Lender
15.
This Agreement shall become effective only upon the satisfaction of each and all of the following:
15.1
The payment by Original Borrower to Lender of the Novation Fee and execution by Original
Borrower of the Novation Fee and Deficiency Settlement Release Agreement of even date herewith.
15.2
The payment by Assuming Borrower to Lender of the sums required herein to be paid prior to the
recordation of the Recorded Amendment.
15.3
Issuance to Lender of either (a) a new ALTA extended coverage loan policy of title insurance in
form and content acceptable to Lender and subject to no exceptions to title other than those shown on Lender’s original title
policy and such other exceptions as Lender may approve in its sole and absolute discretion, or (b) such endorsement(s) to
Lender’s policy of title insurance for the Loan as required by Lender in Lender’s sole discretion and in such form as Lender may
require, insuring the continued first lien priority of the Mortgage as presently insured in said policy, except for non-delinquent
taxes and such other exceptions as Lender may approve in its sole and absolute discretion.
15.4
Execution by Assuming Borrower of the Recorded Amendment evidencing this modification, and
such other documentation as Lender may require.
16.
force and effect.
Except as amended herein, the Note, Mortgage and other Loan Documents remain unmodified and in full
17.
Assuming Borrower acknowledges, warrants, certifies and agrees that the Mortgage constitutes a valid first
lien on the Mortgaged Property and nothing in this Agreement shall limit, discharge, alter or affect the priority of such lien.
Assuming Borrower hereby reaffirms: (i) its obligations under the Note, Mortgage and other Loan Documents; (ii) that upon any
Modification and Assumption Agreement (Off-Record)
Page 6
Event of Default under the Loan Documents or under this Agreement, Lender has the option to declare the entire outstanding
principal balance of the Note and all interest thereon to be immediately due and payable in full; and (iii) that the interest rate and
Default Rate are as set forth in the Note.
18.
In the event that Assuming Borrower shall (i) file with any bankruptcy court of competent jurisdiction or be the
subject of any petition under Title 11 of the U.S. Code, as amended (the "Bankruptcy Code"), (ii) be the subject of any order for
relief issued under the Bankruptcy Code; (iii) file or be the subject of any petition seeking any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief under any present or future federal or state act or law relating
to bankruptcy, insolvency, or other relief for debtors, (iv) have sought or consented to or acquiesced in the appointment of any
trustee, receiver, conservator, or liquidator, or (v) be the subject of any order, judgment, or decree entered by any court of
competent jurisdiction approving a petition filed against such party for any reorganization, arrangement, composition,
readjustment, liquidation, dissolution, or similar relief under any present or future federal or state act or law relating to
bankruptcy, insolvency, or relief for debtors, and such action causes Lender to seek necessary or appropriate relief, then
(a) Lender shall thereupon be entitled and Assuming Borrower irrevocably consents to the relief from any automatic stay
imposed by Section 362 of the Bankruptcy Code, or otherwise available to the Lender as provided in this Agreement or pursuant
to the Note, the Mortgage or any other document evidencing, securing or guarantying the Loan and/or as otherwise provided by
law, and Assuming Borrower hereby irrevocably waives any right to object to such relief and acknowledges that no
reorganization in bankruptcy is feasible; (b) Assuming Borrower waives its exclusive right pursuant to Section 1121(b) of the
Bankruptcy Code to file a plan of reorganization and irrevocably consent to the Lender filing a plan immediately upon the entry of
an order for relief if an involuntary petition is filed against Assuming Borrower or upon the filing of a voluntary petition by
Assuming Borrower; (c) in the event that the Lender shall move pursuant to Section 1121(d) of the Bankruptcy Code for an order
reducing the 120 day exclusive period, Assuming Borrower shall not object to any such motion; (d) Assuming Borrower waives
any rights it may have pursuant to Bankruptcy Code Section 108(b); and (e) Assuming Borrower irrevocably waives its rights to
demand a turnover of the Mortgaged Property from a receiver appointed at the request of Lender, and agrees that it is in the best
interest of the creditors pursuant to Section 543(d) of the Bankruptcy Code for the receiver to continue in possession, custody
and control of the Mortgaged Property.
19.
In consideration for the execution of this Agreement by Lender and Lender’s agreement to the terms and
provisions contained herein, Assuming Borrower, on its own behalf and on behalf of any person or entity claiming by, through or
under Assuming Borrower, does hereby release and forever discharges Lender, Impac and each of their respective subsidiaries,
affiliates, divisions, agents, employees, officers, directors, shareholders, members, representatives, attorneys, advisors,
accountants, and their successors and assigns (collectively, the “Released Parties”) from any and all claims, demands, debts,
damages, liabilities, obligations, accounts and causes of action of whatever kind and character (whether such claims arise in
contract or tort, and whether such claims are founded upon statutory or common law, including, but not limited to, breach of
contract, negligence, breach of any duty of good faith and fair dealing, causes of action arising out of or construed to be
deceptive trade practices, usury, unfair claim settlement practices, business torts, breach of warranty, or any other cause of
action whatsoever) (collectively, “Claims”), whether such Claims are known or unknown, whether suspected or unsuspected, at
law or in equity, arising out of or in any way related to the Loan, the Loan Documents, the obligations thereunder or the
transactions contemplated thereby or by this Agreement, which Assuming Borrower may now have against Released Parties,
including, without limitation, any such Claims directly or indirectly arising from or in connection with (i) any of the Loan
Documents or the obligations thereunder; (ii) any of the transactions contemplated by the Loan Documents or the performance of
the obligations thereunder; (iii) any action or omission to act by any of Released Parties in connection with the Loan or pursuant
to the Loan Documents; and (iv) any other action or omission to act taken on or before the date hereof by any of Released
Parties related to the Loan. Assuming Borrower expressly acknowledges that although it may be that ordinarily a general
release does not extend to claims which the releasing party does not know or suspect to exist in its favor, which if known by it
must have materially affected its settlement with the party released, it has carefully considered and taken into account in
determining whether to enter into this Agreement the possible existence of such unknown losses or claims. Without limiting the
generality of the foregoing, Assuming Borrower expressly waives any and all rights conferred upon them by any statute or rule of
law which provides that a release does not extend to claims which the claimant does not know or suspect to exist in its favor at
the time of executing the release, which if known by it must have materially affected its settlement with the released party.
Assuming Borrower hereby represents that Assuming Borrower has not assigned or transferred, or purported to assign or
transfer to any person or entity, any Claim against Released Parties, or any portion thereof or interest therein and that it is the
sole and rightful owner of any such Claim which may exist. If Assuming Borrower hereafter commences, joins in, or in any
manner seeks relief through any suit arising out of, based upon, or relating to any of the Claims released by Assuming Borrower
herein, then Assuming Borrower will pay to Released Parties, and each of them, in addition to any other damages caused to
Modification and Assumption Agreement (Off-Record)
Page 7
Released Parties thereby, all attorneys’ fees incurred by Released Parties in defending or otherwise responding to the suit or
Claim.
20.
It is understood and agreed that this Agreement and the other written documents to be executed in
connection herewith (including the Recorded Amendment) represent the final agreement between Lender and Assuming
Borrower with respect to the subject matter hereof, and may not be contradicted by evidence of prior, contemporaneous or
subsequent oral agreements between Lender and Assuming Borrower. There are no oral understandings, statements, promises,
or inducements between Lender and Assuming Borrower with respect to the subject matter hereof other than as set forth herein
or in the other written documents to be executed in connection herewith (including the Recorded Amendment). This Agreement
may not be amended or modified except by a written instrument signed by Lender and Assuming Borrower.
21.
Assuming Borrower and Guarantor agree to execute and acknowledge such additional documents as may be
necessary or desirable in order to carry out the intent and purpose of this Agreement and the other Loan Documents, to confirm
or establish the lien of the Mortgage, or to correct any clerical errors or legal deficiencies. Without limiting the foregoing,
Assuming Borrower and Guarantor agree to execute a replacement Assumption Agreement and Agreement to Modify
Promissory Note and Deed of Trust and/or Recorded Amendment in the event either this Agreement or the Recorded
Amendment is lost or destroyed and to execute a corrected and restated substitute Assumption Agreement and Agreement to
Modify Promissory Note and Deed of Trust and/or Recorded Amendment to correct any clerical or other errors which may be
discovered in either the original Assumption Agreement and Agreement to Modify Promissory Note and Deed of Trust or the
Recorded Amendment. Failure of Assuming Borrower and/or Guarantor to comply with any request by Lender pursuant to this
Section within ten (10) days after written request by Lender shall constitute a material Event of Default under the Mortgage.
22.
All notices, demands and other communications (“notice”) under or concerning this Agreement, the Note, the
Mortgage and other Loan Documents shall be in writing and shall be given in the manner set forth in Section 31 of the Mortgage.
All notices to Assuming Borrower and/or Guarantor shall be addressed to Assuming Borrower and/or Guarantor at the following
address: 23586 Calabasas Road, Suite 100, Calabasas, CA 91302.
23.
In no event shall Lender have any obligation hereunder unless and until this Agreement and the separate
Recorded Amendment of even date herewith have been executed by Lender and all conditions set forth herein have been
satisfied. This Agreement and all other documents relating to this loan assumption and modification shall expire if all conditions
set forth herein are not fully satisfied on or before April 29, 2011 (the “Deadline Date”). In the event all conditions set forth
herein are not fully satisfied on or before the Deadline Date, Assuming Borrower or the escrow holder shall return this Agreement
and all other documents relating to this loan assumption and modification to Lender and Lender shall have no obligation to
proceed with the transaction described herein.
24.
The parties intend that the provisions of this Agreement and all other Loan Documents shall be legally
severable. If any term or provision of this Agreement, or any other Loan Document, to any extent, be determined by a court of
competent jurisdiction to be invalid or unenforceable, the remainder of this Agreement or of such other Loan Document shall not
be affected thereby, and each term and provision shall be valid and be enforceable to the fullest extent permitted by law.
[The balance of this page is intentionally left blank.]
Modification and Assumption Agreement (Off-Record)
Page 8
25.
This Agreement shall be governed by the laws of the jurisdiction where the Mortgaged Property is located.
This Agreement may be executed in multiple counterparts. This Agreement may not be amended or modified except by a written
instrument signed by Lender and Assuming Borrower. In the event of any legal action or arbitration between Lender and
Assuming Borrower in connection with this Agreement, the Note, the Mortgage or other Loan Documents, including without
limitation any action by Lender to foreclose or collect the Indebtedness, then Lender shall be entitled to collect and recover its
attorneys' fees and costs of litigation or arbitration. Lender's consent shall not be effective until this Agreement is executed and
delivered by Lender and until all conditions precedent herein have been satisfied.
ASSUMING BORROWER ACKNOWLEDGES AND AGREES THAT PURSUANT TO THE MORTGAGE IF ASSUMING
BORROWER PLACES ANY OTHER LIEN OR ENCUMBRANCE ON THE MORTGAGED PROPERTY WITHOUT THE PRIOR
WRITTEN CONSENT OF LENDER, SUCH ACTION WILL CONSTITUTE AN EVENT OF DEFAULT UNDER THE NOTE,
MORTGAGE AND OTHER LOAN DOCUMENTS.
ASSUMING BORROWER:
KR CAPITAL, LLC,
a California limited liability company
By: ___________________________________
CHRIS RENARD, Manager
By: ___________________________________
MARK KANTER, Manager
[Lender’s signature on next page.]
Modification and Assumption Agreement (Off-Record)
Page 9
CONSENT OF LENDER:
Lender hereby consents to the transfer of the Mortgaged Property to Assuming Borrower and the assumption and modification of
the Note, Mortgage and other Loan Documents as set forth above, and in the Agreement, subject to satisfaction of all conditions
set forth above.
LENDER:
DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee, for
the registered holders of Impac Secured Assets Corp. Mortgage
Pass-Through Certificates Series 2006-2
By: Impac Funding Corporation, its attorney in fact, in its
capacity as Master Servicer pursuant to that certain Pooling
and Servicing Agreement dated as of June 1, 2006
By: _________________________________________
Name: RICHARD E. DAVENPORT, JR.
Its: Authorized Signer
Modification and Assumption Agreement (Off-Record)
Page 10
EXHIBIT “A”
DESCRIPTION OF THE LAND
THE LAND REFERRED TO HEREIN IS SITUATED IN MARICOPA COUNTY, STATE OF ARIZONA, AND IS DESCRIBED AS
FOLLOWS:
PARCEL NO. 1:
THE NORTH 189 FEET OF LOT THIRTY SIX (36), AS MEASURED ALONG THE EAST LINE, RANCHO EL DORADO,
ACCORDING TO BOOK 32 OF MAPS, PAGE 40, RECORDS OF MARICOPA COUNTY, ARIZONA.
PARCEL NO. 2:
THAT PORTION OF LOT THIRTY SIX (36), RANCHO EL DORADO, ACCORDING TO BOOK 32 OF MAPS, PAGE 40,
RECORDS OF MARICOPA COUNTY, ARIZONA, LYING NORTH OF THE EASTERLY PROLONGATION OF THE SOUTH
LINE OF LEMON STREET AS SAID LEMON STREET NOW EXISTS ON THE PLAT OF RANCHO EL DORADO, ACCORDING
TO BOOK 60 OF MAPS, PAGE 35, RECORDS OF MARICOPA COUNTY, ARIZONA:
EXCEPT THE NORTH 189 FEET, AS MEASURED ALONG THE EAST LINE THEREOF.
APN: 132-66-038D
PROPERTY ADDRESS: 1825 EAST DON CARLOS AVENUE, TEMPE, ARIZONA 85281
Modification and Assumption Agreement (Off-Record)
Exhibit A – Legal Description
Page A-1
Document Divider Page
[Staple Each Document Separately and Discard Divider Pages]
PREPARED BY, AND AFTER RECORDING
RETURN TO:
IMPAC COMMERCIAL CAPITAL CORPORATION
19500 Jamboree Road
Irvine, CA 92612
Attn: Rick Davenport
Tax Parcel Number(s): 132-66-038D
Space Above for Recorder’s Use
ASSUMPTION AGREEMENT AND
AMENDMENT TO DEED OF TRUST
This Assumption Agreement and Amendment to Deed of Trust ("Amendment") dated for reference purposes only as
of March 31, 2011, is entered into by and between DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee, for the
registered holders of Impac Secured Assets Corp. Mortgage Pass-Through Certificates Series 2006-2 (“Lender”) and KR
CAPITAL, LLC, a California limited liability company ("Assuming Borrower") with reference to the following facts:
A.
WHEREAS, IMPAC COMMERCIAL CAPITAL CORPORATION, a California corporation (formerly known
as IMPAC MULTIFAMILY CAPITAL CORPORATION, a California corporation) has made a loan to RICHARD D. SMITH and
SYLVIA TORRES SMITH (jointly and severally referred to herein in the singular as "Original Borrower") in the original principal
amount of FIVE HUNDRED FORTY THOUSAND AND 00/100 DOLLARS (US $540,000.00) ("Loan"), which Loan was
evidenced by a Promissory Note ("Note") dated March 9, 2006, which Note is secured by a Deed of Trust, Assignment of Rents,
Security Agreement and Fixture Filing dated March 9, 2006, and recorded on March 21, 2006, as Instrument No. 20060379843,
of Official Records, Maricopa County, Arizona (the "Mortgage”), which Mortgage encumbers certain property located in said
county described in Exhibit "A" hereto ("Mortgaged Property"). The term “Loan Documents” and all other capitalized terms
used and not otherwise defined herein shall have the meaning set forth in the Mortgage or the Note. This Agreement and all
other documents executed by Assuming Borrower in connection with this modification are part of the Loan Documents.
B.
WHEREAS, said Mortgage has been subsequently assigned and transferred to Lender, which assignment is
evidenced by a recorded (or to be recorded) assignment of deed of trust. Lender is the current holder of said Note, Mortgage
and other Loan Documents.
C.
WHEREAS, Assuming Borrower has requested Lender's consent (as required by the Mortgage) to the
transfer of said real property to Assuming Borrower and the assumption by Assuming Borrower of all of Original Borrower's
obligations under the Note and Mortgage, as modified herein.
Modification and Assumption Agreement (Recorded)
Loan No.: 5500002856
D.
WHEREAS, Assuming Borrower desires to memorialize said assumption by Assuming Borrower of the Note
and Mortgage, and has or will in connection herewith execute that certain Assumption Agreement and Agreement to Modify
Promissory Note and Deed of Trust of even date herewith ("Modification Agreement").
E.
WHEREAS, Lender is willing to consent to the assumption by Assuming Borrower and the modifications set
forth in the Modification Agreement subject to the conditions set forth below.
NOW, THEREFORE, in consideration of the foregoing premises and other valuable consideration, the receipt and
sufficiency whereof are hereby acknowledged, the parties hereto agree as follows:
1.
The Note is hereby amended as set forth in the Modification Agreement. Assuming Borrower has assumed
the obligations of Original Borrower as a substitute obligor as more fully set forth in the Modification Agreement. Original
Borrower shall be released from liability under the Note, Mortgage or other Loan Documents upon satisfaction of the terms and
conditions set forth in the Modification Agreement.
2.
The interest rate and other terms of the Note are hereby amended as set forth in the Modification Agreement.
3.
The Mortgage is hereby amended to provide that it secures the Note as amended, and to reflect the
additional modifications as set forth in the Modification Agreement. Without limiting the foregoing: (i) the outstanding principal
balance of the Note as set forth on the first page of the Mortgage is modified from “FIVE HUNDRED FORTY THOUSAND AND
00/100 DOLLARS (US $540,000.00)” to “TWO HUNDRED SIXTY THOUSAND AND 00/100 DOLLARS (US $260,000.00)” and
(ii) Section 6 of the Mortgage is hereby deleted in its entirety and replaced with the following:
“6.
EXCULPATION. Borrower’s personal liability for payment of the Indebtedness and for
performance of the other obligations to be performed by it under this Instrument is limited in the manner, and to the
extent, provided in the Note.”
4.
This Amendment shall become effective only upon the satisfaction of each and all of the following:
4.1
The payment to Lender of the fees, costs and other sums described in the Modification Agreement.
4.2
Issuance to Lender of either (a) a new ALTA extended coverage loan policy of title insurance in
form and content acceptable to Lender and subject to no exceptions to title other than those shown on Lender’s original title
policy and such other exceptions as Lender may approve in its sole and absolute discretion, or (b) such endorsement(s) to
Lender’s policy of title insurance for the Loan as required by Lender in Lender’s sole discretion and in such form as Lender may
require, insuring the continued first lien priority of the Mortgage as presently insured in said policy, except for non-delinquent
taxes and such other exceptions as Lender may approve in its sole and absolute discretion.
Lender.
4.3
Satisfaction of all other terms set forth in the Modification Agreement and otherwise specified by
5.
Except as amended herein, the Note, Mortgage and other Loan Documents shall remain unmodified and in
full force and effect.
[The balance of this page is intentionally left blank.]
Modification and Assumption Agreement (Recorded)
Page 2
6.
This Amendment shall be governed by the laws of the jurisdiction where the Mortgaged Property is located.
This Amendment may be executed in multiple counterparts. This Amendment may not be amended or modified except by a
written instrument signed by Lender and Assuming Borrower. In the event of any legal action or arbitration between Lender and
Assuming Borrower in connection with this Amendment, the Note, the Mortgage or other Loan Documents, including without
limitation any action by Lender to foreclose or collect the Indebtedness, then Lender shall be entitled to collect and recover its
attorneys' fees and costs of litigation or arbitration. Lender's consent shall not be effective until this Amendment is executed and
delivered by Lender and until all conditions precedent herein have been satisfied.
ASSUMING BORROWER ACKNOWLEDGES AND AGREES THAT PURSUANT TO THE MORTGAGE IF ASSUMING
BORROWER PLACES ANY OTHER LIEN OR ENCUMBRANCE ON THE MORTGAGED PROPERTY WITHOUT THE PRIOR
WRITTEN CONSENT OF LENDER, SUCH ACTION WILL CONSTITUTE AN EVENT OF DEFAULT UNDER THE NOTE,
MORTGAGE AND OTHER LOAN DOCUMENTS.
ASSUMING BORROWER:
KR CAPITAL, LLC,
a California limited liability company
By: ___________________________________
CHRIS RENARD, Manager
By: ___________________________________
MARK KANTER, Manager
[Lender’s signature on next page]
Modification and Assumption Agreement (Recorded)
Page 3
LENDER:
DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee, for
the registered holders of Impac Secured Assets Corp. Mortgage
Pass-Through Certificates Series 2006-2
By: Impac Funding Corporation, its attorney in fact, in its
capacity as Master Servicer pursuant to that certain Pooling
and Servicing Agreement dated as of June 1, 2006
By: _________________________________________
Name: RICHARD E. DAVENPORT, JR.
Its: Authorized Signer
Modification and Assumption Agreement (Recorded)
Page 4
State of California
) ss.
County of ___________________________ )
On ______________________, 2011, before me, _________________________________________, Notary Public, personally
appeared CHRIS RENARD,
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 and official seal.
Signature ___________________________________________
Signature of Notary Public
Place Notary Seal Above
State of California
) ss.
County of ___________________________ )
On ______________________, 2011, before me, _________________________________________, Notary Public, personally
appeared MARK KANTER,
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 and official seal.
Signature ___________________________________________
Signature of Notary Public
Place Notary Seal Above
State of California
) ss.
County of ___________________________ )
On ______________________, 2011, before me, _________________________________________, Notary Public, personally
appeared RICHARD E. DAVENPORT, JR.,
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 and official seal.
Signature ___________________________________________
Signature of Notary Public
Place Notary Seal Above
EXHIBIT “A”
DESCRIPTION OF THE LAND
THE LAND REFERRED TO HEREIN IS SITUATED IN MARICOPA COUNTY, STATE OF ARIZONA, AND IS DESCRIBED AS
FOLLOWS:
PARCEL NO. 1:
THE NORTH 189 FEET OF LOT THIRTY SIX (36), AS MEASURED ALONG THE EAST LINE, RANCHO EL DORADO,
ACCORDING TO BOOK 32 OF MAPS, PAGE 40, RECORDS OF MARICOPA COUNTY, ARIZONA.
PARCEL NO. 2:
THAT PORTION OF LOT THIRTY SIX (36), RANCHO EL DORADO, ACCORDING TO BOOK 32 OF MAPS, PAGE 40,
RECORDS OF MARICOPA COUNTY, ARIZONA, LYING NORTH OF THE EASTERLY PROLONGATION OF THE SOUTH
LINE OF LEMON STREET AS SAID LEMON STREET NOW EXISTS ON THE PLAT OF RANCHO EL DORADO, ACCORDING
TO BOOK 60 OF MAPS, PAGE 35, RECORDS OF MARICOPA COUNTY, ARIZONA:
EXCEPT THE NORTH 189 FEET, AS MEASURED ALONG THE EAST LINE THEREOF.
APN: 132-66-038D
PROPERTY ADDRESS: 1825 EAST DON CARLOS AVENUE, TEMPE, ARIZONA 85281
Modification and Assumption Agreement (Recorded)
Exhibit A – Legal Description
Page A-1
Document Divider Page
[Staple Each Document Separately and Discard Divider Pages]
LIMITED LIABILITY COMPANY BORROWING AUTHORIZATION
IT IS HEREBY CERTIFIED BY THE UNDERSIGNED:
1.
That the undersigned are the managers of the limited liability company known as KR CAPITAL, LLC, a
California limited liability company (the “Assuming Borrower”).
2.
That the undersigned managers (referred to herein, whether one or more, as "said manager") have the full
power and authority to act in the name and on behalf of Assuming Borrower, to:
(a)
Assume and modify an existing loan held by DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Trustee, for the registered holders of Impac Secured Assets Corp. Mortgage Pass-Through Certificates Series 2006-2
("Lender") to RICHARD D. SMITH and SYLVIA TORRES SMITH in the original principal sum of FIVE HUNDRED FORTY
THOUSAND AND 00/100 DOLLARS (US $540,000.00) (reduced to TWO HUNDRED SIXTY THOUSAND AND 00/100
DOLLARS (US $260,000.00)), plus interest and other charges and sums that may become due in connection with the loan
documents evidencing such credit;
(b)
Execute notes, modification agreements, amendments, assumption agreements, drafts,
guarantees, or applications for letters of credit, or give agreements of any type as evidence thereof;
(c)
Discount with Lender notes, drafts, trade acceptances, contracts, or other paper at any time owned
or held by said Assuming Borrower;
(d)
Execute and deliver to Lender guarantees of the obligations or liabilities of others, including,
without limitation, continuing guarantees, guarantees of loans and guarantees of completion; and
(e)
Pledge, assign, mortgage, hypothecate, and/or execute mortgages or deeds of trust upon or
security agreements covering any real, personal or intangible property of any kind of Assuming Borrower, whether now owned or
hereafter acquired, as security for any or all obligations, now or hereafter existing, of Assuming Borrower to Lender; and any
moneys or other property of Assuming Borrower at any time held by Lender, and direct the disposition of the proceeds of any
obligation of said Assuming Borrower to said Lender.
3.
That all instruments and documents hereinabove referred to shall be in such form and shall contain such
terms and conditions as may be approved by said manager, such approval to be conclusively evidenced by the execution thereof
by said manager.
4.
That Lender shall be entitled to act in reliance upon the matters herein contained without further inquiry of
any kind, notwithstanding anything contained in the limited liability company operating agreement of Assuming Borrower or any
other agreements or documents.
5.
That Assuming Borrower has filed and published, if required by law, its fictitious name certificate, and has
duly recorded an appropriate statement or certificate of limited liability company in each county in which the limited liability
company owns any real property, including the county in which the Lender's security for the subject credit is located, and
elsewhere as required by law.
6.
This Authorization may be executed in any number of counterparts each of which shall be deemed an
original, but all such counterparts together shall constitute but one Authorization. If multiple authorizations are outstanding at any
time, they shall be considered cumulative as to amounts.
IN WITNESS WHEREOF, this Authorization has been executed by the undersigned as of March 31, 2011.
____________________________________________
CHRIS RENARD, Manager
____________________________________________
MARK KANTER, Manager
LLC Borrowing Authorization
Loan No.: 5500002856
Document Divider Page
[Staple Each Document Separately and Discard Divider Pages]
EXCEPTIONS TO NON-RECOURSE GUARANTY
(Arizona)
This Exceptions to Non-Recourse Guaranty ("Guaranty") is entered into as of March 31, 2011, by MARK KANTER
and CHRIS RENARD (jointly and severally referred to herein in the singular as "Guarantor"), for the benefit of DEUTSCHE
BANK NATIONAL TRUST COMPANY, as Trustee, for the registered holders of Impac Secured Assets Corp. Mortgage
Pass-Through Certificates Series 2006-2 and/or any subsequent holder of the Note (the "Lender").
RECITALS
A.
Lender is the holder of a Promissory Note ("Note") dated March 9, 2006, executed by RICHARD D. SMITH
and SYLVIA TORRES SMITH (jointly and severally referred to herein in the singular as "Original Borrower"), as maker in the
original principal amount of FIVE HUNDRED FORTY THOUSAND AND 00/100 DOLLARS (US $540,000.00) (reduced to
TWO HUNDRED SIXTY THOUSAND AND 00/100 DOLLARS (US $260,000.00)), which Note is secured by a Deed of Trust,
Assignment of Rents, Security Agreement and Fixture Filing dated March 9, 2006, and recorded on March 21, 2006, as
Instrument No. 20060379843, of Official Records, Maricopa County, Arizona (the "Security Instrument”), which Security
Instrument encumbers certain property located in said county described in the Security Instrument ("Mortgaged Property").
B.
Said Note and Security Instrument have been modified pursuant to the terms of that certain unrecorded
Assumption Agreement and Agreement to Modify Promissory Note and Deed of Trust of even date herewith entered into
between Borrower (defined below) and Lender (“Modification Agreement”), and evidenced by that certain Assumption
Agreement and Amendment to Deed of Trust (“Amendment”) recorded or to be recorded in said county.
C.
Pursuant to the Modification Agreement, KR CAPITAL, LLC, a California limited liability company
("Borrower") has assumed the Note and Security Instrument subject to the modifications therein and in the Amendment.
D.
Lender is willing to consent to the transfer of the Mortgaged Property from Original Borrower to Borrower and
the modifications set forth in the Modification Agreement, subject to the conditions set forth in the Modification Agreement. Said
conditions include the execution and delivery of this Guaranty by Guarantor for the benefit of Lender.
NOW, THEREFORE, in order to induce Lender to approve the transfer of the Mortgaged Property to Borrower and
agree to the modifications set forth in the Modification Agreement, and in consideration thereof, Guarantor agrees as follows:
1.
“Indebtedness” and other capitalized terms used but not defined in this Guaranty shall have the meanings
assigned to them in the Security Instrument.
2.
Guarantor hereby absolutely, unconditionally and irrevocably guarantees to Lender the full and prompt
payment when due, whether at maturity or earlier, by reason of acceleration or otherwise, and at all times thereafter, and the full
and prompt performance when due, of all of the following:
(a) All amounts for which Borrower is personally liable under Paragraph 9(b) of the Note, as modified; and
(b) All costs and expenses, including reasonable fees and out of pocket expenses of attorneys and expert
witnesses, incurred by Lender in enforcing its rights under this Guaranty.
For purposes of determining Guarantor's liability under this Guaranty, all payments made by Borrower with respect to the
Indebtedness and all amounts received by Lender from the enforcement of its rights under the Security Instrument shall be
applied first to the portion of the Indebtedness for which neither Borrower nor Guarantor has personal liability.
3.
The obligations of Guarantor under this Guaranty shall survive any foreclosure proceeding, any foreclosure
sale, any delivery of any deed in lieu of foreclosure, and any release of record of the Security Instrument, and, in addition, the
obligations of Guarantor relating to Borrower's obligations under Section 18 of the Security Instrument shall survive any
repayment or discharge of the Indebtedness.
4.
Guarantor’s obligations under this Guaranty constitute an unconditional guaranty of payment and
performance and not merely a guaranty of collection.
5.
The obligations of Guarantor under this Guaranty shall be performed without demand by Lender and shall be
unconditional irrespective of the genuineness, validity, regularity or enforceability of the Note, the Security Instrument, or any
other Loan Document, and without regard to any other circumstance which might otherwise constitute a legal or equitable
discharge of a surety, a guarantor, a borrower or a mortgagor. Guarantor hereby waives the benefit of all principles or provisions
of law, statutory or otherwise, which are or might be in conflict with the terms of this Guaranty and agrees that Guarantor's
obligations shall not be affected by any circumstances, whether or not referred to in this Guaranty, which might otherwise
constitute a legal or equitable discharge of a surety, a guarantor, a borrower or a mortgagor. Guarantor hereby waives the
benefits of any right of discharge under any and all statutes or other laws relating to a surety, a guarantor, a borrower or a
mortgagor and any other rights of a surety, a guarantor, a borrower or a mortgagor thereunder. Without limiting the generality of
the foregoing, Guarantor hereby waives, to the fullest extent permitted by law, diligence in collecting the Indebtedness,
presentment, demand for payment, protest, all notices with respect to the Note and this Guaranty which may be required by
Arizona Guaranty
Loan No.: 5500002856
statute, rule of law or otherwise to preserve Lender's rights against Guarantor under this Guaranty, including, but not limited to,
notice of acceptance, notice of any amendment of the Loan Documents, notice of the occurrence of any default or Event of
Default, notice of intent to accelerate, notice of acceleration, notice of dishonor, notice of foreclosure, notice of protest, and
notice of the incurring by Borrower of any obligation or indebtedness. Guarantor hereby waives, to the fullest extent permitted by
applicable law, any right to revoke this Guaranty as to any future advances by Lender under the Security Instrument to protect its
interest in the Mortgaged Property. Guarantor hereby waives, to the fullest extent permitted by law, all rights to cause a
marshalling of the Borrower’s assets or to require Lender to (a) proceed against Borrower or any other guarantor of Borrower’s
payment or performance with respect to the Indebtedness (an "Other Guarantor") (b) if Borrower or any Other Guarantor is a
partnership, proceed against any general partner of Borrower or any Other Guarantor, (c) proceed against or exhaust any
collateral held by Lender to secure the repayment of the Indebtedness, or (d) pursue any other remedy it may now or hereafter
have against Borrower, or, if Borrower is a partnership, any general partner of Borrower. Guarantor hereby waives, to the fullest
extent permitted by law, any right to object to the timing, manner or conduct of Lender’s enforcement of its rights under any of the
Loan Documents. In addition, Guarantor waives, to the fullest extent allowed by applicable law, all of Guarantor’s rights under §§
12-1641, 12-1642, 12-1643, 12-1644, 33-814, 44-141, 44-142 and 47-3605 of Arizona Revised States, and Rule 17(f) of the
Arizona Rules of Civil Procedure, as now in effect or as modified or amended in the future. Guarantor’s obligations under this
Guaranty may be enforced by Lender in an action regardless of whether a trustee’s sale is held.
6.
At any time or from time to time and any number of times, without notice to Guarantor and without affecting
the liability of Guarantor, (a) the time for payment of the principal of or interest on the Indebtedness may be extended or the
Indebtedness may be renewed in whole or in part; (b) the time for Borrower's performance of or compliance with any covenant or
agreement contained in the Note, the Security Instrument or any other Loan Document, whether presently existing or hereinafter
entered into, may be extended or such performance or compliance may be waived; (c) the maturity of the Indebtedness may be
accelerated as provided in the Note, the Security Instrument, or any other Loan Document; (d) the Note, the Security Instrument,
or any other Loan Document may be modified or amended by Lender and Borrower in any respect, including, but not limited to,
an increase in principal amount; and (e) any security for the Indebtedness may be modified, exchanged, surrendered or
otherwise dealt with or additional security may be pledged or mortgaged for the Indebtedness
7.
If more than one person executes this Guaranty, the obligations of those persons under this Guaranty shall
be joint and several. Lender, in its sole and absolute discretion, may (a) bring suit against Guarantor, or any one or more of the
persons constituting Guarantor, and any Other Guarantor, jointly and severally, or against any one or more of them; (b)
compromise or settle with any one or more of the persons constituting Guarantor for such consideration as Lender may deem
proper; (c) release one or more of the persons constituting Guarantor, or any Other Guarantor, from liability; and (d) otherwise
deal with Guarantor and any Other Guarantor, or any one or more of them, in any manner, and no such action shall impair the
rights of Lender to collect from Guarantor any amount guaranteed by Guarantor under this Guaranty. Nothing contained in this
paragraph shall in any way affect or impair the rights or obligations of Guarantor with respect to any Other Guarantor.
8.
Any indebtedness of Borrower held by Guarantor now or in the future is and shall be subordinated to the
Indebtedness and any such indebtedness of Borrower shall be collected, enforced and received by Guarantor, as trustee for
Lender, but without reducing or affecting in any manner the liability of Guarantor under the other provisions of this Guaranty.
9.
Guarantor shall have no right of, and hereby waives any claim for, subrogation or reimbursement against
Borrower or any general partner of Borrower by reason of any payment by Guarantor under this Guaranty, whether such right or
claim arises at law or in equity or under any contract or statute, until the Indebtedness has been paid in full and there has expired
the maximum possible period thereafter during which any payment made by Borrower to Lender with respect to the
Indebtedness could be deemed a preference under the United States Bankruptcy Code.
10.
If any payment by Borrower is held to constitute a preference under any applicable bankruptcy, insolvency,
or similar laws, or if for any other reason Lender is required to refund any sums to Borrower, such refund shall not constitute a
release of any liability of Guarantor under this Guaranty. It is the intention of Lender and Guarantor that Guarantor's obligations
under this Guaranty shall not be discharged except by Guarantor's performance of such obligations and then only to the extent of
such performance.
11.
Guarantor shall from time to time, upon request by Lender, deliver to Lender such financial statements as
Lender may reasonably require, including copies of all federal and state income tax returns filed by Guarantor within thirty (30)
days after filing.
12.
Lender may assign its rights under this Guaranty in whole or in part and upon any such assignment, all the
terms and provisions of this Guaranty shall inure to the benefit of such assignee to the extent so assigned. The terms used to
designate any of the parties herein shall be deemed to include the heirs, legal representatives, successors and assigns of such
parties; and the term "Lender" shall include, in addition to Lender, any lawful owner, holder or pledgee of the Note. Reference in
this Guaranty to "person" or "persons" shall be deemed to include individuals and entities.
13.
This Guaranty and the other Loan Documents represent the final agreement between the parties and may
not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements. There are no unwritten oral
Arizona Guaranty
Page 2
agreements between the parties. All prior or contemporaneous agreements, understandings, representations, and statements,
oral or written, are merged into this Guaranty and the other Loan Documents. Guarantor acknowledges that it has received and
reviewed copies of the Note and all other Loan Documents. Neither this Guaranty nor any of its provisions may be waived,
modified, amended, discharged, or terminated except by an agreement in writing signed by the party against which the
enforcement of the waiver, modification, amendment, discharge, or termination is sought, and then only to the extent set forth in
that agreement.
14
This Guaranty, and any Loan Document which does not itself expressly identify the law that is to apply to it,
shall be governed by the laws of the jurisdiction in which the Land is located (the "Property Jurisdiction"). Guarantor agrees
that any controversy arising under or in relation to this Guaranty may be litigated in the Property Jurisdiction. The state and
federal courts and authorities with jurisdiction in the Property Jurisdiction shall have non-exclusive jurisdiction over all
controversies which shall arise under or in relation to this Guaranty, the Note, the Security Instrument or any other Loan
Document. Guarantor irrevocably consents to service, jurisdiction, and venue of such courts for any such litigation and waives
any other venue to which it might be entitled by virtue of domicile, habitual residence or otherwise.
15.
Guarantor represents to Lender that Guarantor has a direct or indirect ownership or other financial interest in
Borrower and/or will otherwise derive a material financial benefit from the making of the Loan.
16.
This Guaranty may be executed in any number of counterparts each of which shall be deemed an original,
but all such counterparts together shall constitute but one Guaranty.
17.
The invalidity or unenforceability of any provision of this Guaranty shall not affect the validity or enforceability
of any other provision, and all other provisions shall remain in full force and effect.
18.
GUARANTOR AND LENDER EACH (A) AGREES NOT TO ELECT A TRIAL BY JURY WITH RESPECT
TO ANY ISSUE ARISING OUT OF THIS GUARANTY OR THE RELATIONSHIP BETWEEN THE PARTIES AS GUARANTOR
AND LENDER THAT IS TRIABLE OF RIGHT BY A JURY AND (B) WAIVES ANY RIGHT TO TRIAL BY JURY WITH
RESPECT TO SUCH ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE. THIS WAIVER
OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN BY EACH PARTY, KNOWINGLY AND VOLUNTARILY WITH THE
BENEFIT OF COMPETENT LEGAL COUNSEL.
IN WITNESS WHEREOF, Guarantor has signed and delivered this Guaranty or has caused this Guaranty to be signed
and delivered by its duly authorized representative.
GUARANTOR:
___________________________________
MARK KANTER, individually
___________________________________
CHRIS RENARD, individually
Arizona Guaranty
Page 3
State of California
) ss.
County of ___________________________ )
On ______________________, 2011, before me, _________________________________________, Notary Public, personally
appeared CHRIS RENARD,
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 and official seal.
Signature ___________________________________________
Signature of Notary Public
Place Notary Seal Above
State of California
) ss.
County of ___________________________ )
On ______________________, 2011, before me, _________________________________________, Notary Public, personally
appeared MARK KANTER,
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 and official seal.
Signature ___________________________________________
Signature of Notary Public
Place Notary Seal Above
Document Divider Page
[Staple Each Document Separately and Discard Divider Pages]
CONDITIONAL WAIVER OF IMPOSITION DEPOSITS
THIS CONDITIONAL WAIVER OF IMPOSITION DEPOSITS, dated as of March 31, 2011, is given in connection with
that certain loan in the original principal amount of FIVE HUNDRED FORTY THOUSAND AND 00/100 DOLLARS
(US $540,000.00) (reduced to TWO HUNDRED SIXTY THOUSAND AND 00/100 DOLLARS (US $260,000.00)) (the “Loan”) to
RICHARD D. SMITH and SYLVIA TORRES SMITH, held by DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee,
for the registered holders of Impac Secured Assets Corp. Mortgage Pass-Through Certificates Series 2006-2 (“Lender”).
Said Loan has been assumed by KR CAPITAL, LLC, a California limited liability company (“Assuming Borrower”) pursuant
to an Assumption Agreement and Agreement to Modify Promissory Note and Deed of Trust to be recorded prior to or
concurrently herewith.
1.
The Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing dated March 9, 2006, and
recorded on March 21, 2006, as Instrument No. 20060379843, of Official Records, Maricopa County, Arizona (“Security
Instrument”), executed in connection with said Loan provides for certain Imposition Deposits for Taxes and other Impositions,
including insurance premiums, which sums are to be held and disbursed as set forth in the Security Instrument. All capitalized
terms not otherwise defined herein shall have the meaning set forth in the Security Instrument.
2.
Lender hereby conditionally waives the requirement of such Imposition Deposits for Taxes and insurance
premium payments so long as:
(a) Assuming Borrower provides Lender proof of payment of each installment of Taxes (as defined in the Security
Instrument) no later than 10 days prior to the delinquency date of such installment
(b) Assuming Borrower provides Lender proof of payment of insurance premiums required by the Security Instrument
no later than 10 days prior to the due date(s) of such premiums;
(c) No change to, or replacement of, any insurance policy shall be made by Assuming Borrower without the express
written consent of Lender;
(d) In the event of any Event of Default, whether monetary or other, the suspension of the monthly Imposition
Deposits for Taxes and insurance premium payments shall, at Lender’s option and discretion, be terminated and
Assuming Borrower shall, on the first day of the month following notice by Lender, and throughout the remaining
loan term, be required to pay Imposition Deposits for Taxes and insurance premium payments;
(e) If a Transfer of the Property ownership occurs, Imposition Deposits for Taxes and/or insurance premium
payments may be reinstated at Lender’s option.
3.
The undersigned fully understands the terms and conditions contained herein and acknowledges and agrees
to be bound by this Conditional Waiver of Imposition Deposits. Assuming Borrower represents itself as professional as it relates
to borrowing and using real estate as security and therefore elects not to have Imposition Deposits. Assuming Borrower
releases Lender from any liability and/or responsibility for any act or omission that may occur as it relates to this Conditional
Waiver of Imposition Deposits.
IN WITNESS WHEREOF, Assuming Borrower has executed this Conditional Waiver of Imposition Deposits as of the
date written above.
ASSUMING BORROWER:
KR CAPITAL, LLC, a California limited liability company
By: ___________________________________
MARK KANTER, Manager
By: ___________________________________
CHRIS RENARD, Manager
Arizona Guaranty
Loan No.: 5500002856
Document Divider Page
[Staple Each Document Separately and Discard Divider Pages]
ASSUMPTION FEE AGREEMENT
This Assumption Fee Agreement, dated for reference purposes only as of March 31, 2011, is entered into by and
between DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee, for the registered holders of Impac Secured
Assets Corp. Mortgage Pass-Through Certificates Series 2006-2 (“Lender”) and KR CAPITAL, LLC, a California limited
liability company ("Assuming Borrower") with reference to the following facts:
A.
WHEREAS, IMPAC COMMERCIAL CAPITAL CORPORATION, a California corporation (formerly known
as IMPAC MULTIFAMILY CAPITAL CORPORATION, a California corporation) (“Impac”) has made a loan to RICHARD D.
SMITH and SYLVIA TORRES SMITH in the original principal amount of FIVE HUNDRED FORTY THOUSAND AND 00/100
DOLLARS (US $540,000.00) ("Loan"), which Loan was evidenced by a Promissory Note ("Note") dated March 9, 2006, which
Note is secured by a Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing dated March 9, 2006, and
recorded on March 21, 2006, as Instrument No. 20060379843, of Official Records, Maricopa County, Arizona (the "Mortgage”),
which Mortgage encumbers certain property located in said county described in Exhibit "A" hereto ("Mortgaged Property"). The
term “Loan Documents” and all other capitalized terms used and not otherwise defined herein shall have the meaning set forth
in the Mortgage or the Note.
B.
WHEREAS, said Mortgage has been subsequently assigned and transferred to Lender, which assignment is
evidenced by a recorded (or to be recorded) assignment of deed of trust. Lender is the current holder of said Note, Mortgage
and other Loan Documents.
C.
WHEREAS, Assuming Borrower has requested a modification of said Note and Mortgage.
D.
WHEREAS, Assuming Borrower has requested Lender's consent (as required by the Mortgage) to the
transfer of said real property to Assuming Borrower and the assumption by Assuming Borrower of all of Original Borrower's
obligations under the Note and Mortgage.
E.
WHEREAS, Assuming Borrower has or will in connection herewith execute that certain Assumption
Agreement and Amendment to Deed of Trust of even date herewith ("Recorded Amendment").
F.
WHEREAS, Assuming Borrower and Lender wish to memorialize the amount and conditions for payment by
Assuming Borrower to Lender of a non-refundable fee for this modification transaction.
NOW, THEREFORE, in consideration of the foregoing premises and other valuable consideration, the receipt and
sufficiency whereof are hereby acknowledged, the parties hereto agree as follows:
Assuming Borrower shall pay all fees in connection with this transaction, which includes Lender’s legal, documentation,
title, inspection and other out-of-pocket costs in connection with this transaction. Said fees and costs are estimated and include
an assumption/transfer fee of $2,600.00 and legal/documentation fees in the estimated amount of $1,267.50, plus all other fees
and costs as billed (collectively referred to as the “Assumption Fees”). The Assumption Fees shall be paid prior to the
recordation of the Recorded Amendment. Failure of Assuming Borrower to pay the Assumption Fees prior to the recordation of
the Recorded Amendment shall constitute a material Event of Default without a grace period or opportunity to cure, and, without
limiting any other remedies of Lender, Lender may record a Notice of Default and take other appropriate action to commence
foreclosure.
ASSUMING BORROWER:
KR CAPITAL, LLC, a California limited liability company
By: ___________________________________
CHRIS RENARD, Manager
By: ___________________________________
MARK KANTER, Manager
Assumption Fee Agreement
Loan No.: 5500002856
[Lender’s signature on next page]
LENDER:
DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee, for
the registered holders of Impac Secured Assets Corp. Mortgage
Pass-Through Certificates Series 2006-2
By: Impac Funding Corporation, its attorney in fact, in its
capacity as Master Servicer pursuant to that certain Pooling
and Servicing Agreement dated as of June 1, 2006
By: _________________________________________
Name: RICHARD E. DAVENPORT, JR.
Its: Authorized Signer
Assumption Fee Agreement
Page 2