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CITY COUNCIL AGENDA ITEM NO. 15

Meeting Date: July 26, 2005

Subject/Title: Approve the adoption of the Resolution of the City Council of the City of Brentwood approving a First Time Homebuyer Assistance Program and Authorizing the Execution of Implementing Documents

Prepared by: Ellen Bonneville, Housing Manager

Submitted by: Howard Sword, Director of Community Development

RECOMMENDATION
Approve the adoption of the Resolution of the City Council of the City of Brentwood approving a First Time Homebuyer Assistance Program and authorizing the execution of implementing documents.

PREVIOUS ACTION
On December 14, 2004, the City Council approved and waived first reading of Ordinance 790 amending Chapter 17.725 of the Municipal Code amending the citywide affordable housing program.

On January 25, 2005 the City Council approved Resolution No. 2005-24 amending the 2004/05 Master Fee Schedule/Cost Allocation Plan adopted by Resolution No. 2004-222 by revising the in-lieu fees associated with the affordable housing program.

On June 14, 2005 the City Council approved Resolution No. 2005-143 adopting the 2005/06-2006/07 Operating Budget for the City of Brentwood.

BACKGROUND
The City of Brentwood adopted a new Affordable Housing Ordinance 790 on January 11, 2005, which included an option to contribute to the City’s First Time Homebuyer Program instead of providing the moderate income units on-site. In order to efficiently and effectively use this fund to benefit very low, low and moderate income households, the City of Brentwood commissioned Seifel Consulting Inc. (SCI) to assist in the design of a First Time Homebuyer Assistance Program for the City, which is composed of three programs designed to serve various homebuyers throughout the City. Accordingly, staff and SCI reviewed other jurisdictions’ existing First Time Homebuyer’s programs in order to create an effective program for the City of Brentwood that utilizes the best elements of the programs reviewed.

SCI and staff prepared proposed borrower qualifications and loan terms that provide overarching criteria for the First Time Homebuyer Assistance Program and presented these to the Housing Subcommittee at its meeting of June 2, 2005. At that meeting the Subcommittee made recommendations for changes to the interest rates and the length of the loan term. Staff returned with the suggested revisions to the Housing Subcommittee on June 16th and received the recommendation to place the program on the City Council agenda for approval. Staff is recommending three programs to meet the needs of first time homebuyers in the City of Brentwood:
• Downpayment Assistance Program (DAP): Supports first time homebuyers purchasing market rate homes in Brentwood with additional assistance up to $50,000 in order to provide a larger downpayment contribution, therefore lowering the monthly payment. Staff believes this program would be utilized by mostly moderate income households.
• Gap Assistance for the Affordable Housing Program (GAP): Facilitates first time homebuyers purchasing affordable homes through the City’s Affordable Housing Program by providing additional assistance up to $35,000 for closing costs or downpayment. This program could assist all income categories.
• Individual Development Accounts (IDA): Promotes saving for homeownership in Brentwood for very low and low income households by providing matching loan funds up to $10,000 on a 2:1 basis for each dollar saved. This program could primarily assist very-low income households.
Downpayment Assistance Program (DAP)
This program is designed for first time homebuyers requiring assistance to purchase market rate homes. The intent of the DAP is to “bridge the financing gap” by reducing the overall monthly housing cost to a more affordable housing cost. The program would assist the homebuyer by providing a larger downpayment, thereby lowering the first mortgage and the associated monthly mortgage payment.
Loan Terms
The maximum loan would be 15 percent of purchase price up to a maximum of $50,000. The term of the loan would be the length of time the homeowner occupies the unit as the primary residence or the term of the first mortgage, whichever comes first. The loan interest rate would be calculated using a tiered interest rate that is dependent on the length of homeownership as described below.
Loan Repayment
With City staff’s guidance, SCI explored three options for calculating the City’s return on its initial loan/investment to the first time homebuyer. City staff and the Housing Subcommittee determined that a tiered interest achieved the program objective of promoting long term homeownership in the City as well as ease of administration for staff.

The amount of repayment is a simple interest rate that is dependent on the length of homeownership. If the length of homeownership is three years or less, the interest rate is seven percent (7%). If the length of homeownership is from three to ten years, the interest rate is five percent (5%). The interest rate is three percent (3%) if the length of homeownership is more than ten years. At the end of the term, the homeowner repays the City’s loan (principal) plus the relevant interest rate.

Gap Assistance for the Affordable Housing Program (GAP)
The intention of GAP is to assist first time homebuyers who require gap financing in order to purchase affordable units produced through the City’s Affordable Housing Program. These units will have resale restrictions and will comply with California Community Redevelopment Law (CRL).
Loan Terms
The maximum loan would be $35,000. The term of the loan would be the length of time the homeowner occupies the unit as the primary residence or the term of the first mortgage, whichever comes first. The loan interest is described below.
Loan Repayment
Based on research into comparable programs and discussions with City staff, the GAP program is designed as a simple interest loan program, calculated at a three percent (3%) simple interest rate.
Resale Restrictions and Resale Appreciation Calculation
If the homebuyer purchases a unit through the City’s Affordable Housing Program, the homebuyer purchases the unit at a restricted affordable price, correlated with their income level. Resale restrictions will be recorded against the property in order to maintain the affordability of the unit (45 years for an owner-occupied unit).

In the event that the household wishes to sell the home prior to the termination of the deed restrictions, the City and homebuyer need a mechanism to calculate the affordable housing price at the time of sale (Future Affordable Resale Price). This ensures that the City can continue to maintain the affordability of the unit, while the homeowner is able to receive a reasonable amount of appreciation.

Staff proposes that the Future Affordable Resale Price is calculated based on the percent change in median income for Contra Costa County. The original purchase price is based on affordable housing cost at the time of the purchase, related to the household’s income level. To calculate the Future Affordable Resale Price, the City staff will enter the median income for Contra Costa County at the time of purchase, the median income at the time of sale or transfer, and the original purchase price. The original purchase price is then increased by the percent change between the median income for Contra Costa County at the time of purchase and the median income at the time of sale or transfer.

This method provides the City with a steady, consistent way of calculating the Future Affordable Resale Price. It also holds both the City and homeowner harmless from market changes and interest rate fluctuations.
Individual Development Accounts (IDA)
The Individual Development Accounts (IDA) would help prospective very low and low income homebuyers save money for a downpayment to purchase a home in Brentwood. The City would match every dollar saved by a household on a 2:1 basis, up to a maximum of $10,000 (e.g. the household would contribute $5,000, and the City would provide the matching funds of $10,000, for a total of $15,000.) This could be an additional resource for Brentwood households. The IDA program gives households a structured mechanism by which to save for long-term wealth and asset accumulation.

SCI recommends that this program be directed toward very low or low income households in order to assist them in saving for a downpayment and/or closing costs on a home purchase. This program would encourage very low and low income households to save toward homeownership and would provide a foundation for these households to enter DAP or GAP, as it would provide them with the necessary downpayment and contribution to closing costs.
Loan Terms
The IDA program is initially a matching loan program. The maximum loan would be $10,000. The term of the loan is 10 years; however, once the homebuyer purchases a home in accordance with DAP or GAP, the loan may be forgiven, as described below.
Loan Repayment
If the homebuyer lives in the home for five years, 50 percent of the IDA loan is forgiven. Each additional year the homebuyer remains in the home, 10 percent of the IDA loan is forgiven. If the homebuyer remains in the home for longer than 10 years, the IDA loan is forgiven in its entirety.

However, if the homebuyer sells or transfers the home within the first five years, the homebuyer would repay the matching loan funds in their entirety. If the home is sold or transferred in year’s six to ten, the homebuyer would repay the outstanding amount of the loan in accordance with the calculation described previously. No interest would be charged on the loan.


The borrower qualifications for all of the First Time Homebuyer Assistance Programs are as follows:
• Participants must be first time homebuyers. (A first time homebuyer is defined as a homebuyer/borrower who has not owned a primary residence in California during the last three years. An exception can be made for divorcees.)
• The home must be purchased within the City of Brentwood.
• Preference is given to residents of the City of Brentwood or non-residents employed within the City of Brentwood. (To qualify as a resident, the homebuyer/borrower must have lived in the City six months prior to application to the program. To qualify as a non-resident employed within the City of Brentwood, the household must include a person employed full-time (40 hours per week) at an address inside Brentwood’s city limits at the time of eligibility determination.)
• Income qualified households earning up to 120 percent of Area Median Income (AMI) for Contra Costa County are eligible, dependent on program utilized.
• Homebuyer has to contribute a downpayment of three percent (3%) of sales price or $4,000, whichever is greater (not inclusive of City’s DAP or GAP loan). This is to ensure that the homebuyer has contributed initial equity to the home.
• Homebuyer is required to attend a first time homebuyer education class offered by the City or its designee. (Additional resources, such as credit counseling, are available through Pacific Communities.)
• The purchased unit must be owner occupied. (If the unit is not owner occupied, the borrower is considered to be in default, and the City may declare its loans immediately due and payable or exercise other default provisions.)
• The maximum purchase price will be designated by the CalHFA maximum purchase price each year or as determined by the City’s Affordable Housing Program. For 2005, the maximum purchase price specified by CalHFA is shown in Table I-1.


Table I-1
Maximum Purchase Price for Contra Costa County

Contra Costa County
Non-Targeteda Targetedb
New Construction $543,617 $664,421
Resale $526,123 $643,039
a. Any area in California not designated as a targeted area.
b. A Census Tract that is federally designated as a targeted area.
Source: California Housing Finance Agency (CalHFA), CalHFA Homeownership Program, Sales Price Limits, Effective 03/11/05.
Income Qualifications
Income limits are set forth each year by the State of California, Department of Housing and Community Development (HCD). Typically in April of every year, the income limits are updated and set for the year. Households up to the moderate income level definition may utilize the DAP and GAP programs. The IDA program is targeted to very low and low income households. The April 2005 to March 2006 income limits are presented in Table I-2.


Table I-2
Income Limits for Contra Costa County

Household Size (Persons per Household)
Income Level Maximum Income Level Definition 1 2 3 4 5 6
Very Low 50% of AMI $29,000 $33,100 $37,250 $41,400 $44,700 $48,000
Low 80% of AMI $46,350 $53,000 $59,600 $66,250 $71,550 $76,850
Moderate 120% of AMI $69,050 $78,900 $88,800 $98,650 $106,550 $114,450
Source: HCD, State Income Limits for 2005.
Refinancing Conditions
The refinancing conditions for the First Time Homebuyer Assistance Program are as follows:
• Refinancing is acceptable if refinancing is solely to achieve a lower interest rate on the first mortgage. However, if the purchaser refinances for a line of credit or other mechanism that could result in subordinating the City’s loan, the City’s loan and associated repayment must be paid first from the funding received from the refinancing. (This applies only to the DAP program.)
• Refinancing cannot cause the monthly housing cost after refinancing to be greater than the Affordable Housing Cost for the GAP and IDA programs.
• The loan from refinancing cannot be greater than 90 percent of the original purchase price for the GAP and IDA programs.

Loan Application Approval Process
Staff anticipates that we will have many households interested in this program but only have a finite amount of funding. Based upon practices from other cities surveyed, the criteria for the loan application process will be established as follows:
• First come, first served basis based upon the receipt of an application that has been deemed complete; and
• The priorities and preferences approved in Ordinance 790 that 40% of the loans are targeted for workers and residents of the City of Brentwood.
Adoption of the Resolution authorizes the City Manager, Housing Manager or his or her designee to execute the Loan Agreements and any documents necessary to implement the terms and provisions of the Loan Agreements, subject to any revisions approved by the City Attorney or Special Counsel that are consistent with the approved Program and further authorizes the City Manager and Housing Manager to take all actions necessary to implement the Program, including the preparation and execution of other implementing documents including but not limited to application forms, letters to prospective borrowers and primary lenders and notices of default.
Staff anticipates that it will take approximately 60 days to set up the implementation procedures for the program once the program is approved by the City Council. Therefore, the program should be available to the public by approximately October 1, 2005.

FISCAL IMPACT
The budget for Fiscal Year 2005-06 includes funding for this program in the amount of $250,000 from the Housing Trust Fund. Approval of the Resolution adopting the program authorizes the appropriation of the budgeted funds for the First Time Homebuyer Program.

Attachments
Resolution
Powerpoint Presentation
Loan Documents

RESOLUTION NO.
A RESOLUTION OF THE CITY OF BRENTWOOD APPROVING A FIRST TIME HOMEBUYER ASSISTANCE PROGRAM AND AUTHORIZING THE EXECUTION OF IMPLEMENTING DOCUMENTS
WHEREAS, the City of Brentwood recently adopted an Inclusionary Housing Ordinance amending Chapter 17.725 of the Brentwood Municipal Code, which ordinance included an option to contribute to the City's First Time Homebuyer Program instead of providing moderate income units on-site.
WHEREAS, Seifel Consulting Inc. and City staff have worked to design a First Time Homebuyer Assistance Program for the City that makes efficient and effective use of the First Time Homebuyer funds contributed to the City pursuant to the Inclusionary Housing Ordinance.
WHEREAS, the Housing Subcommittee has reviewed and commented on the proposed First Time Homebuyer Program.
WHEREAS, the City desires to adopt the proposed First Time Homebuyer Assistance Program, which assists first homebuyers earning up to 120 percent of the Area Median Income and purchasing homes in the City of Brentwood.
WHEREAS, the proposed First Time Homebuyer Assistance Program consists of three separate sub-programs: (1) a Downpayment Assistance Program (DAP) to support first time homebuyers purchasing market rate homes by providing loans of up to $50,000; (2) a Gap Assistance for the Affordable Housing Program (GAP) to support first time homebuyers purchasing homes through the City's Affordable Housing Program by providing loans up to $35,000; and (3) Individual Development Accounts (IDA) which provide matching loan funds up to $10,000.
WHEREAS, City staff have prepared draft loan documents to be used in connection with the DAP, GAP and IDA programs and will prepare other necessary implementing documentation after approval of the Program.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BRENTWOOD DOES HEREBY RESOLVE AS FOLLOWS:
1. The City Council hereby approves the First Time Homebuyer Assistance Program (the "Program"), as described in Exhibit A attached hereto.
2. The City Council hereby approves the use of the following Loan Agreements in connection with the Program, which agreements are attached hereto as Exhibit B:
a. Loan Agreement for the Downpayment Assistance Program
b. Loan Agreement for the Gap Assistance for the Affordable Housing Program
c. Loan Agreement for the Downpayment Assistance Program/Individual Development Accounts
d. Loan Agreement for the Gap Assistance for the Affordable Housing Program/Individual Development Accounts
3. The City Council hereby authorizes the City Manager, Housing Manager or his or her designee to execute the Loan Agreements and any documents necessary to implement the terms and provisions of the Loan Agreements, subject to any revisions approved by the City Attorney or Special Counsel that are consistent with the approved Program.
4. The City Council further authorizes the City Manager and Housing Manager to take all actions necessary to implement the Program, including the preparation and execution of other implementing documents including but not limited to application forms, letters to prospective borrowers and primary lenders and notices of default.
PASSED AND ADOPTED this 26th day of July, 2005, by the following vote:



LOAN AGREEMENT
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
DOWNPAYMENT ASSISTANCE PROGRAM (DAP)

This Loan Agreement ("Agreement") is entered into as of , 20 , by and between the City of Brentwood, a municipal corporation ("City") and , ("Borrower").
RECITALS

A. City has established a First Time Homebuyer Assistance Program ("Program") for the benefit of first time homebuyers purchasing homes within the City of Brentwood and earning up to 120 percent of the Area Median Income (as calculated by the State of California, Department of Housing and Community Development).
B. Borrower has applied for a Downpayment Assistance Program loan to assist in Borrower's purchase of the real property commonly known and described as [insert address], Brentwood, California, and more particularly described in Attachment 1, attached hereto (the "Property"). A residence that will be the principal residence of Borrower is located on the Property (the "Residence").
C. The parties wish to enter into this Agreement to define the rights and obligations of City and Borrower with respect to the Loan (as defined below).
NOW, THEREFORE, City and Borrower agree as follows:
AGREEMENT
1. Definitions.
"Agreement" means this Loan Agreement between Borrower and City.
"Borrower" means .
"City" means the City of Brentwood, a municipal corporation.
"Conditions Precedent to Loan Disbursement" is defined in Section 4.
"Deed of Trust" is defined in Section 3.2 below.
"Escrow Holder" means [insert name of escrow company], the escrow holder handling the purchase of the Property by Borrower.
"Event of Default" is defined in Section 7.1 below.
"First Loan" is defined in Section 3.3 below.
"Lender's Policy of Title Insurance" is defined in Section 4.3.
"Loan" is defined in Section 2 below.
"Loan Documents" is defined in Section 3.2 below.
"Maturity Date" is defined in Section 2.1 below.
"Note" is defined in Section 3.1 below.
"Permitted Exceptions" is defined in Section 3.2 below.
"Program" is defined in Recital A.
"Property" is defined in Recital B.
"Ownership Interest" means and includes fee simple, joint tenancy, tenancy in common, life estate, shareholder in a cooperative or interest held in trust for Borrower that would continue on ownership if held by the Borrower.
"Residence" is defined in Recital B.
"Senior Deed of Trust" is defined in Section 3.2 below.
"Term" is defined in Section 2.1 below.

2. Loan. Subject to the terms and conditions set forth herein, City agrees to loan Borrower a principal amount not to exceed $ (the "Loan") to enable Borrower to purchase the Property.
2.1. Term of Loan; Commencement and Maturity Date. The term (the "Term") of the Loan shall commence on the date of execution of the Note and shall end on the earlier of: (a) the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part; or (b) on [insert maturity date of first loan] (the "Maturity Date").
2.2. Repayment of the Loan. So long as Borrower is not in default under this Agreement or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal and interest of the Loan shall be due and payable in full on the Maturity Date. The Loan may be prepaid at any time without penalty.
2.3. Interest. Interest on the Loan shall accrue as follows:
(a) Term of Less than Three Years. If the Term is less than three years, the Loan shall bear simple interest at a rate of seven percent per annum from the date of disbursement.
(b) Term of Three to Ten Years. If the Term is between three and ten years, the Loan shall bear simple interest at a rate of five percent per annum from the date of disbursement.
(c) Term of More than Ten Years. If the Term is more than ten years, the Loan shall bear simple interest at a rate of three percent per annum from the date of disbursement.
2.4. Use of Proceeds; Disbursement to Escrow Holder. Proceeds of the Loan shall be used only for the purchase of the Property and payment of closing and escrow costs required to be paid by Borrower pursuant to section 4.6 below. Upon satisfaction or waiver by City of all of the Conditions Precedent to Loan Disbursement set forth in section 4 below, City shall deliver the proceeds of the Loan to the Escrow Holder, to be applied directly to the purchase of the Property. In no event shall the proceeds of the Loan be disbursed to Borrower.
3. Note, Security Documents and Refinancing.
3.1. Promissory Note. As evidence of Borrower's obligation to repay the Loan, Borrower shall execute and deliver to the Escrow Holder, a promissory note in favor of City in the form attached hereto as Attachment 2 (the "Note").
3.2. Deed of Trust Encumbering Property. As security for Borrower's performance of its obligations hereunder, Borrower shall execute and deliver to the Escrow Holder, a recordable Deed of Trust in favor of City in the form attached hereto as Attachment 3 (the "Deed of Trust"). The Deed of Trust shall be subject and subordinate only to (a) the deed(s) of trust made by Borrower to [insert name of primary lenders], the first lender(s) (the "Senior Deed of Trust"); (b) the lien for current real property taxes not yet due and payable; and (c) existing easements over the Property for public utilities and other purposes (the "Permitted Exceptions"). The Note and the Deed of Trust may hereinafter be collectively referred to as the "Loan Documents."
3.3. Refinancing. Borrower shall not refinance the loan(s) secured by the Senior Deed of Trust (the "First Loan") without the prior written approval of City. City shall approve refinancing if it is solely to achieve a lower interest rate. However, City shall not approve any refinancing that results in any release of funds to Borrower, typically referred to as a "cash-out" loan, unless Borrower agrees to repay the Loan, plus accrued interest, with the proceeds.
4. Conditions Precedent to Loan Disbursement. City's obligation to disburse the Loan is conditioned upon the satisfaction or waiver by City of each and all of the conditions precedent described below (the "Conditions Precedent to Loan Disbursement"), which are solely for the benefit of City.
4.1. No Default. Subject to the expiration of any applicable cure period, Borrower shall not be in default of any of its obligations under the terms of this Agreement and all representations and warranties of Borrower contained herein shall be true and correct.
4.2. Execution of Loan Documents. Borrower shall have executed the Note and shall have executed and acknowledged the Deed of Trust in recordable format.
4.3. Lender's Policy of Title Insurance. Escrow Holder shall be unconditionally and irrevocably committed to issuing a CLTA Lender's policy of title insurance to City insuring City in the principal amount of the Loan and the validity and priority of the Deed of Trust as a lien upon the Property, subject only to the Permitted Exceptions, and showing fee simple title to the Property in the name of Borrower ("Lender's Policy of Title Insurance").
4.4. Prepared to Close Escrow. Borrower shall have executed and acknowledged, where necessary, all documents and shall be in a position to close escrow on the Property.
4.5. Recordation of Documents. The Deed of Trust shall have been recorded against the Property in the Contra Costa County Recorder's Office.
4.6. Payment of Escrow Fees and Costs. Borrower shall have paid all escrow fees and closing costs for the purchase of the Property and the premium for the Lender's Policy of Title Insurance, which may be paid for out of the proceeds of the Loan.
5. Representations and Warranties. Borrower represents and warrants that the matters addressed in subsections 5.1 through 5.8 below are true and correct.
5.1. No Conflicts. The execution, delivery, and performance of this Agreement and of any instrument or agreement required by this Agreement are not in conflict with any law or any indenture, agreement, or undertaking to which Borrower is a party or by which Borrower is bound or affected.
5.2. Enforceability. This Agreement is a legal, valid and binding agreement of Borrower, enforceable against Borrower in accordance with its terms, and any instrument or agreement required under this Agreement, when executed and delivered, will be similarly legal, valid, binding and enforceable.
5.3. No Event of Default. No event has occurred and is continuing or would result from the extension of credit under this Agreement which constitutes or would constitute an Event of Default or which, upon a lapse of time or notice or both, would become an Event of Default.
5.4. Other Obligations. Borrower is not in default under any other agreement involving the borrowing of money, the extension of credit, or the lease of real or personal property to which Borrower is a party as borrower, guarantor, installment purchaser or lessee.
5.5. No Other Liens. Other than the Senior Deed of Trust, Borrower is not encumbering the Property with any other lien, deed of trust or security interest.
5.6. First Time Homebuyer. Borrower has not had any Ownership Interest in the State of California in his, her or their primary residence in the three years preceding the date of application to participate in the Program, except for an Ownership Interest in a primary residence that was terminated or extinguished due to divorce or marital dissolution.
5.7. Application Information. All of the information provided by Borrower in the Program loan application, including, without limitation, income criteria, is true and accurate.
5.8. Attended Class. Borrower has attended a First Time Homebuyer Education Class offered by City or City's designee.
6. Covenants. Borrower promises to keep each of the covenants set forth below, unless City has waived compliance in writing.
6.1. Compliance with Laws. Borrower shall at all times comply with, or cause to be complied with, all federal, state and local laws, statutes, rules, regulations, ordinances, orders and directions affecting the Property.
6.2. Occupy as Principal Residence. Borrower shall occupy the Residence as Borrower's principal residence and shall reside in the Residence on a full-time basis.
6.3. Taxes and Other Liabilities. Borrower shall pay all taxes and other governmental or regulatory assessments assessed and levied against the Property at least ten calendar days prior to delinquency and shall timely file all required tax returns.
6.4. Liens and Other Indebtedness. Other than the Senior Deed of Trust, Borrower shall not encumber the Property with any other lien, deed of trust or security interest without the prior written approval of City.
6.5. Refinancing. Borrower shall comply with the refinancing provisions set forth in Section 3.3 above.
6.6. No Lease. Borrower shall not assign or lease the whole or any part of the Property.
6.7. Attend Classes. Borrower shall attend any follow-up First Time Homebuyer Education Classes offered by City or City's designee.
7. Default and Remedies.
7.1. Events of Default. The occurrence of any of the following events, and the continuation thereof beyond the corresponding cure period (if any) set forth below, shall constitute an "Event of Default" under this Agreement:
(a) Borrower fails to make any payment as and when due under the Loan Documents, where such failure continues beyond ten calendar days after written notice from City specifying the general nature and the amount of the overdue payment.
(b) Borrower fails to comply with any provision contained in this Agreement or the Loan Documents, other than provisions governing repayment of the Loan, and does not cure that failure within 30 calendar days after written notice from City.
(c) Any representation or warranty of Borrower set forth in this Agreement or the Loan Documents, or any information delivered by Borrower to City pursuant to this Agreement, proves to be false or misleading in any material respect.
(d) Under any of the Loan Documents, an event of default or default (as defined in that document) occurs.
7.2. Remedies. If an Event of Default occurs under this Agreement or any of the Loan Documents, City may exercise any right or remedy which it has under any of the documents, or which is otherwise available at law, in equity or by statute, and all of City's rights and remedies shall be cumulative. Upon the occurrence of any Event of Default, all of Borrower's obligations under the Loan Documents may become immediately due and payable without notice of default, presentment or demand for payment, protest or notice of nonpayment or dishonor, or other notices or demands of any kind or character, all at City's option, exercisable in its sole discretion.
7.3. Interest Upon Event of Default. At all times when Borrower is in default by reason of Borrower's failure to pay principal or interest due under this Agreement, the interest rate on the sums to which Borrower is in default, shall be the lower of the highest rate then allowed by law or five percent over the prime interest rate announced by Bank of America N.T.&S.A., as of the date of the Event of Default. If Bank of America N.T.&S.A. no longer exists or fails to announce a prime interest rate, the prime interest rate announced by the largest bank, in terms of total assets, of the member banks of the Eleventh District Federal Reserve Bank that announce a prime interest rate, shall be applicable for purposes of this section 7.3.
8. No Assignment. The qualifications and identity of Borrower are of particular concern to City. It is because of those unique qualifications and identity that City has entered into this Agreement with Borrower. No voluntary or involuntary successor in interest of Borrower shall acquire any of Borrower's rights or powers under this Agreement.
9. Miscellaneous.
9.1. Joint and Several Liability. All covenants and agreements of Borrower shall be the joint and several obligations of all signatories, makers, sureties, guarantors and endorsers and shall be binding upon them.
9.2. Further Assurances. The parties shall execute, acknowledge, file or record such other instruments and statements and shall take such additional action as may be necessary to carry out the purpose and intent of this Agreement.
9.3. Binding Effect. Subject to the prohibitions against assignment set forth in section 8 above, this Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns.
9.4. Governing Law. This Agreement shall be construed and interpreted in accordance with and shall be governed and enforced in all respects according to the laws of the State of California, without regard to conflict of laws principles.
9.5. Time of the Essence. Time is of the essence of each and every provision of this Agreement.
9.6. Integration. This Agreement contains the entire understanding between the parties relating to the transaction contemplated by this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged in this Agreement and shall be of no further force or effect.
9.7. Notices. All written notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by overnight courier service, or (iv) delivered by facsimile, provided that the original of such facsimile notice is sent by certified U.S. mail, postage prepaid, no later than one business day following such facsimile. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery pursuant to the methods specified in clauses (i), (ii) or (iii) above if the intended recipient refuses to accept delivery). All such notices shall be delivered to the following addresses, or to such other address as the receiving party may from time to time specify by written notice to the other party:
To City: City of Brentwood
Attn: Housing Manager
150 City Park Way
Brentwood, CA 94513
Telephone No.:
Fax No.:

To Borrower:


Telephone No.:
Fax No.:

9.8. Severability. The illegality or unenforceability of any provision of this Agreement or any instrument or agreement required hereunder shall not in any way affect or impair the legality or enforceability of the remaining provisions of this Agreement or any instrument or agreement required hereunder.
9.9. No Waiver. A waiver by any party of a breach of any of the covenants, conditions or agreements under this Agreement to be performed by another party shall not be construed as a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or conditions of this Agreement.
9.10. Rights Cumulative. All rights and remedies existing under this Agreement are cumulative to, and not exclusive of, any other rights or remedies available under contract or applicable law.
9.11. Modifications and Amendments. This Agreement may be amended only in writing signed by the parties.
9.12. Cooperation. Each party agrees to cooperate with the other in this transaction and, in that regard, shall execute any and all documents which may be reasonably necessary, helpful, or appropriate to carry out the purposes and intent of this Agreement including, but not limited to, releases or additional agreements.
9.13. 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 of any of its terms. Reference to section numbers are to sections in this Agreement, unless expressly stated otherwise.
9.14. Computation of Time. The time in which any act is to be done under this Agreement is computed by excluding the first day (such as the day escrow opens), 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 Sections 6700 and 6701 of the California Government Code. If any act is to be done by a particular time during a day, that time shall be Pacific Time Zone time.
9.15. Incorporation of Recitals and Exhibits. All recitals and exhibits attached hereto are incorporated into this Agreement by reference as if set forth fully herein.
[Signatures follow on next page]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

BORROWER




By:

Name:

By:

Name:
CITY

City of Brentwood, a municipal corporation

By:

Name:
Donna Landeros, City Manager

Attest:

By:
Cindy Garcia, Interim City Clerk

Approved as to Form:


By:
Tom Curry, Interim City Attorney




ATTACHMENT 1

Legal Description of the Property

[To be inserted]


ATTACHMENT 2

PROMISSORY NOTE
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
DOWNPAYMENT ASSISTANCE PROGRAM (DAP)

Not to Exceed , 20__
$ Brentwood, California
NOTICE TO MAKER: THE LOAN EVIDENCED BY THIS NOTE IS SECURED BY A DEED OF TRUST THAT PROVIDES FOR AN INTEREST RATE OF 3, 5 OR 7 PERCENT DEPENDENT UPON YOUR LENGTH OF OWNERSHIP AND A LUMP SUM PAYMENT OF PRINCIPAL AND INTEREST AT MATURITY.

FOR VALUE RECEIVED, , ("Borrower"), having an address of , promises to pay the CITY OF BRENTWOOD ("City"), having an address of 150 City Park Way, Brentwood, CA 94513, the principal sum of DOLLARS ($ ), pursuant to the terms and conditions set forth below.
1. Loan. This Promissory Note (the "Note") is made pursuant to Section 3.1 of that certain Loan Agreement (the "Agreement") between Borrower and City, dated , 20__. This is a promissory note for the repayment to City of the Dollar ($ ) loan provided by City to Borrower (the "Loan") in order to enable Borrower to purchase that certain real property described in Attachment 1 of the Agreement (the "Property"). Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement.
2. Disbursement. The Loan shall be disbursed in accordance with and subject to the Conditions Precedent to Loan Disbursement set forth in Section 4 of the Agreement.
3. Deed of Trust. Payment of this Note is secured by a deed of trust, security agreement and fixture filing (the "Deed of Trust") executed by Borrower to , as Trustee, for the benefit of City, which Deed of Trust shall be recorded against the Property.
4. Repayment. So long as Borrower is not in default under this Note or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal and interest of the Loan shall be due and payable in full on the earlier of: (a) the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part; or (b) on [insert maturity date of first loan] (the "Maturity Date").
5. Interest. Interest on the Loan shall accrue as follows:
5.1 Term of Less than Three Years. If the Maturity Date is less than three years after the date of execution of this Note, the Loan shall bear simple interest at a rate of seven percent per annum from the date of disbursement.

5.2 Term of Three to Ten Years. If the Maturity Date is between three and ten years after the date of execution of this Note, the Loan shall bear simple interest at a rate of five percent per annum from the date of disbursement.

5.3 Term of More than Ten Years. If the Maturity Date is more than ten years after the date of execution of this Note, the Loan shall bear simple interest at a rate of three percent per annum from the date of disbursement.

6. Place of Payment. Payment shall be made in lawful money of the United States to City, City of Brentwood at the following address: 150 City Park Way, Brentwood, California 94513. The place of payment may be changed from time to time as the City may designate in writing.

7. Non-Negotiability; Transfer. This Note is non-negotiable and not transferable by Borrower. Borrower, at its option, may negotiate transfer or assumption of this Note.
8. Prepayment. Borrower shall have the right to prepay, at any time and from time to time, all or any portion of the amounts owing under this Note without any premium or penalty.
9. Event of Default. The occurrence of any of the following shall constitute an event of default under this Note: (a) Borrower fails to pay any amount due hereunder within ten calendar days of its due date; or (b) any default by Borrower under the Deed of Trust, the Agreement or any other loan or other document affecting the Property, including, but not limited to, refinancing the Loan in violation of the terms of the Agreement, subject to any applicable cure periods provided therein.
10. Payment Upon Default. At the option of City and without notice, the entire unpaid principal and interest owing on this Note shall become immediately due and payable (a) upon the occurrence of any event of default, or (b) upon the sale, transfer, assignment, conveyance or lease of the Property, in whole or in part, prior to repayment of the principal and interest owing on this Note. This option may be exercised at any time following any such event, and the acceptance of one or more installments thereafter shall not constitute a waiver of City's option. City's failure to exercise such option shall not constitute a waiver of such option with respect to any subsequent event. City's failure in the exercise of any other right or remedy hereunder or under any agreement which secures the indebtedness or is related thereto shall not affect any right or remedy and no single or partial exercise of any such right or remedy shall preclude any further exercise thereof.
11. Interest Upon Default. At all times when Borrower is in default hereunder by reason of Borrower's failure to pay principal or interest due under this Note or any amounts due under any loan documents securing this Note, the interest rate on the sums as to which Borrower is in default, shall be the lower of the highest rate then allowed by law or five percent over the prime interest rate announced by Bank of America N.T.&S.A., as of the date of the default. If Bank of America N.T.&S.A. no longer exists or fails to announce a prime interest rate, the prime interest rate announced by the largest bank, in terms of total assets, of the member banks of the Eleventh District Federal Reserve Bank that announce a prime interest rate, shall be applicable for purposes of this section.
12. Waiver of Presentment. Borrower and any endorsers hereof and all others who may become liable for all or any part of this obligation, severally waive presentment for payment, demand and protest and notice of protest, and of dishonor and nonpayment of this Note, and expressly consent to any extension of the time of payment hereof or of any installment hereof, to the release of any party liable for this obligation, and any such extension or release may be made without notice to any of said parties and without any way affecting or discharging this liability.
13. Attorney Fees. Borrower agrees to pay immediately upon demand all costs and expenses of City including reasonable attorneys' fees, (a) if after an event of default this Note is placed in the hands of an attorney or attorneys for collection, (b) if after an event of default hereunder, City finds it necessary or desirable to secure the services or advice of one or more attorneys with regard to collection of this Note against Borrower, any guarantor or any other party liable therefor or to the protection of its rights under this Note, the Deed of Trust, the Agreement, or other loan document, or (c) if City seeks to have the Property abandoned by or reclaimed from any estate in bankruptcy, or attempts to have any stay or injunction prohibiting the enforcement or collection of the Note or prohibiting the enforcement of the Deed of Trust or any other agreement evidencing or securing this Note lifted by any bankruptcy or other court. If City shall be made a party to or shall reasonably intervene in any action or proceeding, whether in court or before any governmental Agency, affecting the Property or the title thereto or the interest of the City under the Deed of Trust, including, without limitation, any form of condemnation or eminent domain proceeding, City shall be reimbursed by Borrower immediately upon demand for all costs, charges and attorneys' fees incurred by City in any such case, and the same shall be secured by the Deed of Trust as a further charge and lien upon the Property.
14. Notices. All notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, or (iii) delivered by overnight courier service. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery if the intended recipient refuses to accept delivery). All such notices shall be delivered to the addresses set forth above, or to such other address as the receiving party may from time to time specify by written notice to the other party.
15. Successors and Assigns. This Note shall be binding upon Borrower, its successors and assigns.
16. Governing Law. This Note shall be construed in accordance with and be governed by the laws of the State of California, without regard to conflict of laws principles.
17. Severability. If any provision of this Note is declared invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.
18. Construction with Agreement. In the event of any inconsistency between this Note and the Agreement, the terms of this Note shall prevail.
19. Joint and Several Liability. All covenants and agreements of Borrower shall be joint and several obligations.
BORROWER




By:

Name:

By:

Name:
ATTACHMENT 3

Deed of Trust


RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City of Brentwood
150 City Park Way
Brentwood, California 94513
Attn: Housing Manager ))))))))
)
This document is exempt from the payment of a recording fee pursuant to Government Code § 6103.

DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
DOWNPAYMENT ASSISTANCE PROGRAM (DAP)


NOTICE TO BORROWER: THE LOAN SECURED BY THIS DEED OF TRUST PROVIDES FOR AN INTEREST RATE OF 3, 5 OR 7 PERCENT DEPENDENT UPON YOUR LENGTH OF OWNERSHIP AND A LUMP SUM PAYMENT OF PRINCIPAL AND INTEREST AT MATURITY.

This Deed of Trust, Security Agreement and Fixture Filing is made as of , among , ("Borrower"), whose address is , , a ("Trustee"), whose address is , and the City of Brentwood, a California municipal corporation ("City"), whose address is 150 City Park Way, Brentwood, California 94513.

Borrower irrevocably grants, conveys, transfers and assigns to Trustee in trust, with power of sale and right of entry and possession, all of Borrower's estate, right, title and interest in, to and under the following property (collectively, "Property"): (a) the real property in Contra Costa County, California, described on Exhibit A attached hereto and incorporated herein by this reference, together with all existing and future easements and rights affording access to it ("Land"), (b) together with all buildings, structures and improvements now existing or hereafter constructed thereon ("Improvements"), (c) together with all articles of personal property now or hereafter attached to, placed upon for an indefinite term, or used in connection with the Land and/or Improvements, together with all goods and other property that are, or at any time become, so related to the Property that an interest in them arises under real estate law, or they are otherwise adjudged to be a "fixture" under applicable law (each a "Fixture," collectively "Fixtures"), (d) together with all other property and interests of any kind or character which may be reasonably necessary or desirable to promote the present and future beneficial use and enjoyment of such real property and improvements.

1. Secured Obligations. Borrower makes the grant, conveyance, transfer and assignment herein for the purpose of securing the following obligations ("Secured Obligations"): (a) payment of the sum of DOLLARS ($ ) together with interest on the unpaid principal balance according to the terms of a promissory note ("Note") of even date herewith and the Loan Agreement ("Loan Agreement") dated _______________, by and between Borrower and City and any amendment, modification, extension, rearrangement, restatement, replacement, substitution or renewals thereof; (b) payment of such further sums as the then record owner of the Property may borrow from City, when evidenced by a promissory note or notes reciting that they are secured by this Deed of Trust; and (c) performance of each agreement of Borrower incorporated by reference or contained herein or in the Note or the Loan Agreement.

2. Maintenance and Repair. Borrower shall (a) keep the Property in good condition and repair and not remove or demolish any building; (b) complete or restore promptly and in good and workmanlike manner any building which may be constructed, damaged or destroyed; (c) pay when due all claims for labor performed and materials furnished; (d) comply with all laws affecting the Property or requiring any alterations or improvements to be made; (e) not commit or permit waste; (f) cultivate, irrigate, fertilize, fumigate, prune and do all other acts which from the character or use of the Property may be reasonably necessary; and (g) not cause or permit any Hazardous Materials (as hereinafter defined) to be brought upon, kept or used in or about the Property by Borrower, its agents, employees, contractors or invitees. If Borrower breaches the obligations stated in this Section 2, then Borrower shall indemnify, defend (with counsel approved by City) and hold City harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in value of the Property, and sums paid in settlement of claims, attorneys' fees, consultant fees and expert fees) which arise during or after the term of this Deed of Trust as a result of such breach, contamination, discharge, or release. This indemnification of City by Borrower includes, without limitation, costs incurred in connection with any investigation of site conditions or any cleanup, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of Hazardous Materials present in, on or under the Property or adjacent property caused by, or as a result of, Borrower's activities. This indemnification specifically excludes Hazardous Materials brought on the Property by prior occupants. For the purpose of this Section 2, the term "Hazardous Materials" includes, without limitation, any flammable explosives, radioactive materials, hazardous materials, hazardous wastes, hazardous or toxic substances, or related materials defined in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. §9601 et seq.), the Hazardous Materials Transportation Act, as amended (49 U.S.C. §1801 et seq.), the Resource Conservation and Recovery Act of 1976, as amended (42 U.S.C. §6901 et seq.), Section 25117 of the California Health & Safety Code, Section 25316 of the California Health & Safety Code, and in the regulations adopted and publications promulgated pursuant to them, or any other federal, state, or local environmental laws, ordinances, rules, or regulations concerning the environment, industrial hygiene or public health or safety now in effect or enacted after this date.

3. Insurance. Borrower shall maintain hazard insurance against loss by fire, hazards included with the term "extended coverage," and any other hazards for which City requires insurance, and liability insurance. The insurance carrier and the insurance policies and amounts of coverage shall be acceptable to City, the policies shall name City as a loss payee or an additional insured, as applicable, the policies shall include City as an additional insured, as applicable, and shall require 30 calendar days' prior notice to City before the policy is modified or terminated.

4. Defense of Security. Borrower shall appear in and defend any action or proceeding purporting to affect the security or the rights or powers of City or Trustee. Borrower shall pay all costs and expenses, including costs of evidence of title and attorneys' fees, in any such action or proceeding in which Trustee or City may appear, and in any suit brought by City to foreclose this Deed of Trust.

5. Payment of Taxes and Liens. Borrower shall pay (a) at least 10 calendar days before delinquency, all taxes and assessments affecting the Property, including water stock assessments; (b) when due, all encumbrances, charges and liens, with interest, on the Property; and (c) upon demand all costs, fees and expenses of this Deed of Trust. If Borrower fails to make any payment or to do any act provided for in this Deed of Trust, then City or Trustee may, without obligation to do so, and with or without notice to or demand upon Borrower, and without releasing Borrower from any obligation under this Deed of Trust: (w) make or do the same in such manner and to such extent as either may deem necessary to protect the security, City or Trustee being authorized to enter upon the Property for such purposes; (x) appear in or commence any action or proceeding purporting to affect the security, or the rights or powers of City or Trustee; (y) pay, purchase, contest or settle any encumbrance, charge or lien which in the judgment of either appears to be senior to this Deed of Trust; and (z) in exercising any such powers, pay allowable expenses, including attorneys' fees.

6. Reimbursement of Costs. Borrower shall pay upon demand all sums expended by City or Trustee provided for in this Deed of Trust or allowed by law, with interest from date of expenditure at the maximum rate provided in the Note.

7. Borrower Not Released; Forbearance by City Not a Waiver. By accepting payment of any sum after its due date, City does not waive its right either to require prompt payment when due of all other sums or declare a default for failure to pay. Extension of the time for payment, acceptance of a renewal note or notes, release of any person from liability, modification of the payment terms and conditions, or modification or amortization of the sums secured by this Deed of Trust granted by City to any successor in interest of Borrower shall not operate to release, in any manner, the liability of the original Borrower and Borrower's successors in interest. City shall not be required to commence proceedings against such successor or refuse to extend time for payment, accept a renewal note or notes, release any person from liability, otherwise modify the payment terms and conditions, or modify amortization of the sums secured by this Deed of Trust by reason of any demand made by the original Borrower and Borrower's successors in interest. Any forbearance by City in exercising any right or remedy hereunder, or otherwise afforded by applicable law, shall not be a waiver of or preclude the exercise of any such right or remedy.

8. Reconveyance. That upon written request of City stating that all sums secured hereby have been paid, and upon surrender of this Deed of Trust and the 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 grantee in such reconveyance may be described as "the person or persons legally entitled thereto."

9. Occupancy of Property; No Rental. Borrower shall occupy, establish and maintain the use of the Property as Borrower's principal residence throughout the term of the Note securing this Deed of Trust. There shall be no rental of the Property.

10. Default and Foreclosure. Upon default by Borrower in payment or performance of any Secured Obligation, subject to any applicable cure period, City may declare all sums secured immediately due and payable by delivery to Trustee of a declaration of default and demand for sale and of a notice of default and of a notice of sale, which notice Trustee shall cause to be filed for record. City also shall deposit with Trustee this Deed of Trust, said Note and all documents evidencing expenditures secured by this Deed of Trust. Upon default of any obligation secured by this Deed of Trust and acceleration of all sums due, City may instruct Trustee to proceed with a sale of the Property under the power of sale granted in this Deed of Trust, noticed and held in accordance with California Civil Code Sections 2924, et seq., as such statutes may be amended from time to time. Borrower waives all rights it may have to require marshaling of assets or to require sales of assets in any particular order, including any rights under California Civil Code Sections 2899 and 3455.

11. Substitution of Trustee. City, or any successor in ownership of any Secured Obligations, may from time to time, by instrument in writing, substitute a successor or successors to any Trustee named herein or acting hereunder, which instrument executed by the City and duly acknowledged and recorded in the Contra Costa County Recorder's Office, 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 Borrower, Trustee and City hereunder, the book and page where this Deed of Trust is recorded and the name and address of the new Trustee.

12. Successors and Assigns. This Deed of Trust applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns. The term "City" shall mean the owner and holder, including pledgees, of the Note, whether or not named as City herein.

13. Trustee Acceptance. Trustee accepts this trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. Trustee is not obligated to notify any party hereto of pending sale under any other deed of trust or of any action or proceeding in which Borrower, City or Trustee shall be a party unless brought by Trustee.

14. Further Assurances. Borrower shall, at its own cost and expense, do, execute, acknowledge, and deliver all and every such further acts, deeds, conveyances, mortgages, assignments, notices of assignments, transfers, and assurances as Trustee or City shall from time to time require, for better assuring, conveying, assigning, transferring, and confirming unto Trustee the Property and rights hereby conveyed or assigned or intended now or hereafter so to be, or which Borrower may be or may hereafter become bound to convey or assign to Trustee, or for carrying out the intention or facilitating the performance of the terms of this Deed of Trust, or for filing, registering, or recording this Deed of Trust. Borrower shall, on demand, execute and deliver, and hereby authorizes Trustee and City, or either of them, to execute in the name of Borrower, to the extent it may lawfully do so, one or more financing statements, chattel mortgages, or comparable security instruments, to evidence more effectively the lien hereof. Immediately upon the execution and delivery of this Deed of Trust, and thereafter from time to time, Borrower shall cause this Deed of Trust, and any security instruments creating a lien or evidencing the lien hereof upon any property and each instrument of further assurance, to be filed, registered, or recorded in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to protect the lien hereof upon, and the title of Trustee to, the Property encumbered hereby.

15. Condemnation and Insurance Proceeds. Immediately upon obtaining knowledge of the institution of any proceedings for the condemnation or other taking of all or any portion of the Property, or knowledge of any casualty damage to the Property, or damage in any other manner, Borrower shall immediately notify City thereof. Borrower hereby authorizes and empowers City as attorney-in-fact for Borrower to make proof of loss, to adjust and compromise any claim under the insurance policies covering the Property, to appear in and prosecute any action arising from such insurance policies, to collect and receive insurance proceeds, and to deduct therefrom City's expenses incurred in the collection of such proceeds; provided, however, that nothing contained in this Section shall require City to incur any expense or take any action hereunder. Borrower hereby authorizes and empowers City, at City's option, as attorney-in-fact for Borrower, to commence, appear in and prosecute, in City's or Borrower's name, any action or proceeding relating to any condemnation or other taking of all or any part of the Property, whether direct or indirect, and to settle or compromise any claim in connection with such condemnation or other taking. The proceeds of any award payment or claim for damages, direct or consequential, in connection with any condemnation or other taking, whether direct or indirect, of the Property, or any part thereof, or for conveyances in lieu of the Property, or any part thereof, shall be paid to City. The foregoing powers of attorney are coupled with an interest and are irrevocable. Borrower hereby authorizes City to apply such awards, payments, proceeds or damages relating to condemnation of the Property and insurance covering the Property, after the deduction of City's expenses incurred in the collection of such amounts, subject to the requirements of applicable law and the provisions hereof, to restoration or repair of the Property or to payment of the sums secured by this Deed of Trust. City shall be under no obligation to question the amount of any compensation, awards, proceeds, damages, claims, rights of action, and payments relating to condemnation or other taking of the Property or insured casualty affecting the Property, and may accept the same in the amount in which the same shall be paid. Borrower shall execute such further evidence of assignment of any awards, proceeds damages or claims arising in connection with such condemnation or taking or such insurance as City may require. Notwithstanding the above, the City shall release all insurance and condemnation proceeds to Borrower to be used to reconstruct the improvements on the Property provided that City determines that such restoration, repair or rebuilding is economically feasible. If such insurance proceeds shall be insufficient for such purposes, Borrower shall make up the deficiency. If the Property is subject to a partial condemnation or taking, then the proceeds received therefrom shall be applied to restore the Property taken, provided the City determines that such restoration is economically feasible and no default exists under the Loan Agreement, the Note, this Deed of Trust, and all other instruments or agreements required to be executed by Borrower or any guarantor in connection with the Loan (collectively, "Loan Documents") following the expiration of all applicable cure periods. If the Property is subject to a total condemnation, or if City determines that restoration of the Property is not feasible following a partial condemnation, or if a default exists then the proceeds from any condemnation award or claim for damages shall be used first to repay all sums under the Note, with the excess, if any, paid to Borrower.

16. Estoppel Certificate. Borrower shall, within ten calendar days of a written request from City, furnish City with a written statement, duly acknowledged, setting forth the sums secured by this Deed of Trust and any right of set-off, counterclaim or other defense which exists against such sums and the obligations of this Deed of Trust.

17. California Uniform Commercial Code Security Agreement; Fixture Filing. Borrower hereby grants City a security interest in all fixtures of Borrower now owned or hereafter in existence, acquired or created on, of or relating to the Property, and all substitutions, replacements, additions, accessions and proceeds (including insurance proceeds) of all of the foregoing (collectively, "Secured Property"). City may file this Deed of Trust, or a reproduction hereof, in the real estate records or other appropriate index, as a financing statement for the Secured Property. Any reproduction of this Deed of Trust or of any other security agreement or financing statement shall be sufficient as a financing statement. In addition, Borrower shall execute and deliver to City, upon City's request, any financing statements, as well as extensions, renewals and amendments thereof, and reproductions of this Deed of Trust in such form as City may require to perfect a security interest with respect to the Secured Property. Borrower shall pay all costs of filing such financing statements and any extensions, renewals, amendments and releases thereof, and shall pay all reasonable costs and expenses of any record searches for financing statements City may reasonably require. Without the prior written consent of City, Borrower shall not create or suffer to be created pursuant to the California Uniform Commercial Code any other security interest in the Secured Property. Upon Borrower's breach of any covenant or agreement of Borrower contained in this Deed of Trust, including the covenants to pay when due all sums secured by this Deed of Trust, City shall have the remedies of a secured party under the California Uniform Commercial Code and, at City's option, may also invoke any remedies provided in this Deed of Trust as to the Secured Property. In exercising any of such remedies, City may proceed against the Property and any of the Secured Property separately or together and in any order whatsoever, without in any way affecting the availability of City's remedies under the California Uniform Commercial Code or the remedies provided in the Deed of Trust. This Deed of Trust also covers goods which are or which are to become fixtures on the Property and constitutes and is filed as a fixture filing under the California Uniform Commercial Code.

18. Due-On-Sale or Encumbrance. If all or any part of the Property, or any interest therein, or any beneficial interest in Borrower (if Borrower is not a natural person or persons but is a corporation, partnership, trust, limited liability company or other legal entity), is sold, transferred, mortgaged, assigned, pledged, or further encumbered, whether directly or indirectly, whether voluntarily or involuntarily or by operational law, City may, at City's option, declare all of the sums secured by this Deed of Trust to be immediately due and payable, and City may invoke any remedies permitted by this Deed of Trust.

19. Subordination. City and Borrower acknowledge and agree that this Deed of Trust is subject and subordinate in all respects to the liens, terms, covenants and conditions of the senior deed of trust in favor of in the amount of DOLLARS ($ ) existing as of the date hereof (“Senior Deed of Trust"), and to those advances heretofore made or which may hereafter be made pursuant to the Senior Deed of Trust for the purpose of protecting or further securing the lien of the Senior Deed of Trust, or curing defaults by the Borrower under the Senior Deed of Trust. Borrower may refinance the loan secured by the Senior Deed of Trust only in accordance with Section 3.3 of the Loan Agreement. Notwithstanding anything to the contrary in the Note, Loan Agreement, or this Deed of Trust, the status of this Deed of Trust as a lien and security interest on the Property shall be second only to the Senior Deed of Trust.

20. No Discrimination. Borrower covenants that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, sexual preference, age, marital status, physical handicap, medical condition, disability, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, nor shall the Borrower itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the Property.

21. Authorization; Joint and Several. Each individual or entity executing this Deed of Trust on behalf of Borrower represents and warrants that he or she or it is duly authorized to execute and deliver this Deed of Trust on behalf of Borrower and that such execution is binding upon Borrower. If Borrower consists of more than one person, the obligation of all such persons shall be joint and several, with each person who signs this Deed of Trust being fully and personally obligated to keep all of the promises made in this Deed of Trust, including the promise to pay the full amount owed. City, in City's sole discretion, may enforce its rights under this Deed of Trust against any person individually or against all Borrowers together.

22. Waiver of Statute of Limitations. The pleading of any statute of limitations as a defense to the obligations evidenced by this Deed of Trust is waived to the fullest extent permissible by law.

23. Notices. All notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, or (iii) delivered by overnight courier service. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery if the intended recipient refuses to accept delivery). All such notices shall be delivered to the addresses set forth above, or to such other address as the receiving party may from time to time specify by written notice to the other parties.

24. Remedies. In the event of default under the Loan Documents, City may exercise any right or remedy which it has under any or all of the Loan Document(s), or which is otherwise available at law or in equity or by statute, and all of City's rights and remedies shall be cumulative.

25. Modifications. Any waiver, change, modification or discharge of this Deed of Trust may be made only by the prior written consent of City and Borrower. No alteration, amendment or waiver of any provision of this Deed of Trust, or any other agreement or instrument evidencing or providing security for this Deed of Trust, made by agreement of City, the holder hereof or any other person or party, shall constitute a waiver of any other term hereof, or otherwise release or discharge the liability of Borrower under this Deed of Trust.

26. Severability; Construction; Governing Law. If any provision of this Deed of Trust or the application of any such provision shall be held by a court of competent jurisdiction to be invalid, void or unenforceable to any extent, the remaining provisions of this Deed of Trust and the application thereof shall remain in full force and effect and shall not be affected, impaired or invalidated. This Deed of Trust shall be construed and enforced in accordance with the laws of the State of California without reference to its choice of laws principles. Section headings have been inserted solely as a matter of convenience and are not intended to define or limit the scope of any of the provisions contained therein.

27. Integration. The Note, this Deed of Trust, and the Loan Agreement embody the agreement between City and Borrower for the Loan and its terms and conditions. If any term of this Deed of Trust is inconsistent with any term of the Note or the Loan Agreement, the terms of the Note shall govern.

The undersigned Borrower requests that a copy of any Notice of Default and of any Notice of Sale hereunder be mailed to Borrower at Borrower's address hereinbefore set forth.

BORROWER




By:

Name:

By:

Name:



EXHIBIT A

The real property referred to herein is situated in the City of Brentwood, Contra Costa County, California, and is commonly known as , and more particularly described as follows:

[To be inserted]


STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On , 200 , before me, , the undersigned, personally appeared ,
( ) personally known to me
( ) 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.
WITNESS my hand and official seal:
Signature:


STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On , 200 , before me, , the undersigned, personally appeared ,
( ) personally known to me
( ) 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.
WITNESS my hand and official seal:
Signature:

LOAN AGREEMENT
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
GAP ASSISTANCE FOR THE AFFORDABLE HOUSING PROGRAM (GAP)

This Loan Agreement ("Agreement") is entered into as of , 20 , by and between the City of Brentwood, a municipal corporation ("City") and , ("Borrower").
RECITALS

A. City has established a First Time Homebuyer Assistance Program ("Program") for the benefit of first time homebuyers purchasing homes within the City of Brentwood and earning up to 120 percent of the Area Median Income (as calculated by the State of California, Department of Housing and Community Development).
B. Borrower is purchasing the real property commonly known and described as [insert address], Brentwood, California, and more particularly described in Attachment 1, attached hereto (the "Property"), through the City's Affordable Housing Program. A residence that will be the principal residence of Borrower is located on the Property (the "Residence"). In connection with this purchase, Borrower and City are entering into a Resale and Refinance Limitation Agreement and Option to Purchase ("Resale Restriction Agreement"), which will restrict the sale of the Property to -income households for a period of 45 years.

C. Borrower has applied for a Gap Assistance for the Affordable Housing Program loan to assist in Borrower's purchase of the Property.

D. The parties wish to enter into this Agreement to define the rights and obligations of City and Borrower with respect to the Loan (as defined below).
NOW, THEREFORE, City and Borrower agree as follows:
AGREEMENT
10. Definitions.
"Agreement" means this Loan Agreement between Borrower and City.
"Borrower" means .
"City" means the City of Brentwood, a municipal corporation.
"Conditions Precedent to Loan Disbursement" is defined in Section 4.
"Deed of Trust" is defined in Section 3.2 below.
"Escrow Holder" means [insert name of escrow company], the escrow holder handling the purchase of the Property by Borrower.
"Event of Default" is defined in Section 7.1 below.
"First Loan" is defined in Section 3.3 below.
"Lender's Policy of Title Insurance" is defined in Section 4.3.
"Loan" is defined in Section 2 below.
"Loan Documents" is defined in Section 3.2 below.
"Maturity Date" is defined in Section 2.1 below.
"Note" is defined in Section 3.1 below.
"Permitted Exceptions" is defined in Section 3.2 below.
"Program" is defined in Recital A.
"Property" is defined in Recital B.
"Ownership Interest" means and includes fee simple, joint tenancy, tenancy in common, life estate, shareholder in a cooperative or interest held in trust for Borrower that would continue on ownership if held by the Borrower.
"Resale Restriction Agreement" is defined in Recital B.
"Residence" is defined in Recital B.
"Senior Deed of Trust" is defined in Section 3.2 below.
"Term" is defined in Section 2.1 below.

11. Loan. Subject to the terms and conditions set forth herein, City agrees to loan Borrower a principal amount not to exceed $ (the "Loan") to enable Borrower to purchase the Property.
11.1. Term of Loan; Commencement and Maturity Date. The term (the "Term") of the Loan shall commence on the date of execution of the Note and shall end on the earlier of: (a) the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part; or (b) on [insert maturity date of first loan] (the "Maturity Date").
11.2. Repayment of the Loan. So long as Borrower is not in default under this Agreement or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal and interest of the Loan shall be due and payable in full on the Maturity Date. The Loan may be prepaid at any time without penalty.
11.3. Interest. The Loan shall bear simple interest at a rate of three percent per annum from the date of disbursement.
11.4. Use of Proceeds; Disbursement to Escrow Holder. Proceeds of the Loan shall be used only for the purchase of the Property and payment of closing and escrow costs required to be paid by Borrower pursuant to section 4.6 below. Upon satisfaction or waiver by City of all of the Conditions Precedent to Loan Disbursement set forth in section 4 below, City shall deliver the proceeds of the Loan to the Escrow Holder, to be applied directly to the purchase of the Property. In no event shall the proceeds of the Loan be disbursed to Borrower.
12. Note, Security Documents and Refinancing.
12.1. Promissory Note. As evidence of Borrower's obligation to repay the Loan, Borrower shall execute and deliver to the Escrow Holder, a promissory note in favor of City in the form attached hereto as Attachment 2 (the "Note").
12.2. Deed of Trust Encumbering Property. As security for Borrower's performance of its obligations hereunder, Borrower shall execute and deliver to the Escrow Holder, a recordable Deed of Trust in favor of City in the form attached hereto as Attachment 3 (the "Deed of Trust"). The Deed of Trust shall be subject and subordinate only to (a) the deed(s) of trust made by Borrower to [insert name of primary lender], the first lender(s) (the "Senior Deed of Trust"); (b) the Resale Restriction Agreement; (c) the lien for current real property taxes not yet due and payable; and (d) existing easements over the Property for public utilities and other purposes (the "Permitted Exceptions"). The Note and the Deed of Trust may hereinafter be collectively referred to as the "Loan Documents."
12.3. Refinancing. Borrower shall not refinance the loan secured by the Senior Deed of Trust (the "First Loan"), except as allowed under the Resale Restriction Agreement and Program requirements, which allow refinancing if all of the following requirements are met: (a) refinancing without the prior written approval of City, City shall approve refinancing if it is solely to achieve a lower interest rate; (b) refinancing does not cause the monthly housing cost after refinancing to be greater than an Affordable Housing Cost, as defined in Health & Safety Code Section 50052.5; and (c) the amount being refinanced is not greater than 90 percent of the original purchase price. Borrower must receive written approval of City prior to refinancing the First Loan in order to ensure that these Program requirements are met. However, City shall not approve any refinancing that results in any release of funds to Borrower, typically referred to as a "cash-out" loan, unless Borrower agrees to repay the Loan, plus accrued interest, with the proceeds.
13. Conditions Precedent to Loan Disbursement. City's obligation to disburse the Loan is conditioned upon the satisfaction or waiver by City of each and all of the conditions precedent described below (the "Conditions Precedent to Loan Disbursement"), which are solely for the benefit of City.
13.1. No Default. Subject to the expiration of any applicable cure period, Borrower shall not be in default of any of its obligations under the terms of this Agreement and all representations and warranties of Borrower contained herein shall be true and correct.
13.2. Execution of Loan Documents and Resale Restriction Agreement. Borrower shall have executed the Note and shall have executed and acknowledged the Deed of Trust and Resale Restriction Agreement in recordable format.
13.3. Lender's Policy of Title Insurance. Escrow Holder shall be unconditionally and irrevocably committed to issuing a CLTA Lender's policy of title insurance to City insuring City in the principal amount of the Loan and the validity and priority of the Deed of Trust as a lien upon the Property, subject only to the Permitted Exceptions, and showing fee simple title to the Property in the name of Borrower ("Lender's Policy of Title Insurance").
13.4. Prepared to Close Escrow. Borrower shall have executed and acknowledged, where necessary, all documents and shall be in a position to close escrow on the Property.
13.5. Recordation of Documents. The Deed of Trust shall have been recorded against the Property in the Contra Costa County Recorder's Office.
13.6. Payment of Escrow Fees and Costs. Borrower shall have paid all escrow fees and closing costs for the purchase of the Property and the premium for the Lender's Policy of Title Insurance, which may be paid for out of the proceeds of the Loan.
14. Representations and Warranties. Borrower represents and warrants that the matters addressed in subsections 5.1 through 5.8 below are true and correct.
14.1. No Conflicts. The execution, delivery, and performance of this Agreement and of any instrument or agreement required by this Agreement are not in conflict with any law or any indenture, agreement, or undertaking to which Borrower is a party or by which Borrower is bound or affected.
14.2. Enforceability. This Agreement is a legal, valid and binding agreement of Borrower, enforceable against Borrower in accordance with its terms, and any instrument or agreement required under this Agreement, when executed and delivered, will be similarly legal, valid, binding and enforceable.
14.3. No Event of Default. No event has occurred and is continuing or would result from the extension of credit under this Agreement which constitutes or would constitute an Event of Default or which, upon a lapse of time or notice or both, would become an Event of Default.
14.4. Other Obligations. Borrower is not in default under any other agreement involving the borrowing of money, the extension of credit, or the lease of real or personal property to which Borrower is a party as borrower, guarantor, installment purchaser or lessee.
14.5. No Other Liens. Other than the Senior Deed of Trust and Resale Restriction Agreement, Borrower is not encumbering the Property with any other lien, deed of trust or security interest.
14.6. First Time Homebuyer. Borrower has not had any Ownership Interest in the State of California in his, her or their primary residence in the three years preceding the date of application to participate in the Program, except for an Ownership Interest in a primary residence that was terminated or extinguished due to divorce or marital dissolution.
14.7. Application Information. All of the information provided by Borrower in the Program loan application, including, without limitation, income criteria, is true and accurate.
14.8. Attended Class. Borrower has attended a First Time Homebuyer Education Class offered by City or City's designee.
14.9. Affordable Housing Program. Borrower has completed all of City's requirements for participation in the City's Affordable Housing Program.
15. Covenants. Borrower promises to keep each of the covenants set forth below, unless City has waived compliance in writing.
15.1. Compliance with Laws. Borrower shall at all times comply with, or cause to be complied with, all federal, state and local laws, statutes, rules, regulations, ordinances, orders and directions affecting the Property.
15.2. Occupy as Principal Residence. Borrower shall occupy the Residence as Borrower's principal residence and shall reside in the Residence on a full-time basis.
15.3. Taxes and Other Liabilities. Borrower shall pay all taxes and other governmental or regulatory assessments assessed and levied against the Property at least ten calendar days prior to delinquency and shall timely file all required tax returns.
15.4. Liens and Other Indebtedness. Other than the Senior Deed of Trust and Resale Restriction Agreement, Borrower shall not encumber the Property with any other lien, deed of trust or security interest without the prior written approval of City.
15.5. Refinancing. Borrower shall comply with the refinancing provisions set forth in Section 3.3 above.
15.6. No Lease. Borrower shall not assign or lease the whole or any part of the Property.
15.7. Attend Classes. Borrower shall attend any follow-up First Time Homebuyer Education Classes offered by City or City's designee.
16. Default and Remedies.
16.1. Events of Default. The occurrence of any of the following events, and the continuation thereof beyond the corresponding cure period (if any) set forth below, shall constitute an "Event of Default" under this Agreement:
(a) Borrower fails to make any payment as and when due under the Loan Documents, where such failure continues beyond ten calendar days after written notice from City specifying the general nature and the amount of the overdue payment.
(b) Borrower fails to comply with any provision contained in this Agreement or the Loan Documents, other than provisions governing repayment of the Loan, or the Resale Restriction Agreement, and does not cure that failure within 30 calendar days after written notice from City.
(c) Any representation or warranty of Borrower set forth in this Agreement, the Loan Documents or the Resale Restriction Agreement, or any information delivered by Borrower to City pursuant to this Agreement, proves to be false or misleading in any material respect.
(d) Under any of the Loan Documents or the Resale Restriction Agreement, an event of default or default (as defined in that document) occurs.
16.2. Remedies. If an Event of Default occurs under this Agreement, any of the Loan Documents or the Resale Restriction Agreement, City may exercise any right or remedy which it has under any of the documents, or which is otherwise available at law, in equity or by statute, and all of City' rights and remedies shall be cumulative. Upon the occurrence of any Event of Default, all of Borrower's obligations under the Loan Documents may become immediately due and payable without notice of default, presentment or demand for payment, protest or notice of nonpayment or dishonor, or other notices or demands of any kind or character, all at City's option, exercisable in its sole discretion.
16.3. Interest Upon Event of Default. At all times when Borrower is in default by reason of Borrower's failure to pay principal or interest due under this Agreement, the interest rate on the sums to which Borrower is in default, shall be the lower of the highest rate then allowed by law or five percent over the prime interest rate announced by Bank of America N.T.&S.A., as of the date of the Event of Default. If Bank of America N.T.&S.A. no longer exists or fails to announce a prime interest rate, the prime interest rate announced by the largest bank, in terms of total assets, of the member banks of the Eleventh District Federal Reserve Bank that announce a prime interest rate, shall be applicable for purposes of this section 7.3.
17. No Assignment. The qualifications and identity of Borrower are of particular concern to City. It is because of those unique qualifications and identity that City has entered into this Agreement with Borrower. No voluntary or involuntary successor in interest of Borrower shall acquire any of Borrower's rights or powers under this Agreement.
18. Miscellaneous.
18.1. Joint and Several Liability. All covenants and agreements of Borrower shall be the joint and several obligations of all signatories, makers, sureties, guarantors and endorsers and shall be binding upon them.
18.2. Further Assurances. The parties shall execute, acknowledge, file or record such other instruments and statements and shall take such additional action as may be necessary to carry out the purpose and intent of this Agreement.
18.3. Binding Effect. Subject to the prohibitions against assignment set forth in section 8 above, this Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns.
18.4. Governing Law. This Agreement shall be construed and interpreted in accordance with and shall be governed and enforced in all respects according to the laws of the State of California, without regard to conflict of laws principles.
18.5. Time of the Essence. Time is of the essence of each and every provision of this Agreement.
18.6. Integration. This Agreement contains the entire understanding between the parties relating to the transaction contemplated by this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged in this Agreement and shall be of no further force or effect.
18.7. Notices. All written notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by overnight courier service, or (iv) delivered by facsimile, provided that the original of such facsimile notice is sent by certified U.S. mail, postage prepaid, no later than one business day following such facsimile. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery pursuant to the methods specified in clauses (i), (ii) or (iii) above if the intended recipient refuses to accept delivery). All such notices shall be delivered to the following addresses, or to such other address as the receiving party may from time to time specify by written notice to the other party:
To City: City of Brentwood
Attn: Housing Manager
150 City Park Way
Brentwood, CA 94513
Telephone No.:
Fax No.:

To Borrower:


Telephone No.:
Fax No.:

18.8. Severability. The illegality or unenforceability of any provision of this Agreement or any instrument or agreement required hereunder shall not in any way affect or impair the legality or enforceability of the remaining provisions of this Agreement or any instrument or agreement required hereunder.
18.9. No Waiver. A waiver by any party of a breach of any of the covenants, conditions or agreements under this Agreement to be performed by another party shall not be construed as a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or conditions of this Agreement.
18.10. Rights Cumulative. All rights and remedies existing under this Agreement are cumulative to, and not exclusive of, any other rights or remedies available under contract or applicable law.
18.11. Modifications and Amendments. This Agreement may be amended only in writing signed by the parties.
18.12. Cooperation. Each party agrees to cooperate with the other in this transaction and, in that regard, shall execute any and all documents which may be reasonably necessary, helpful, or appropriate to carry out the purposes and intent of this Agreement including, but not limited to, releases or additional agreements.
18.13. 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 of any of its terms. Reference to section numbers are to sections in this Agreement, unless expressly stated otherwise.
18.14. Computation of Time. The time in which any act is to be done under this Agreement is computed by excluding the first day (such as the day escrow opens), 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 Sections 6700 and 6701 of the California Government Code. If any act is to be done by a particular time during a day, that time shall be Pacific Time Zone time.
18.15. Incorporation of Recitals and Exhibits. All recitals and exhibits attached hereto are incorporated into this Agreement by reference as if set forth fully herein.
[Signatures follow on next page]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

BORROWER




By:

Name:

By:

Name:
CITY

City of Brentwood, a municipal corporation

By:
Name:
Donna Landeros, City Manager

Attest:

By:
Cindy Garcia, Interim City Clerk

Approved as to Form:


By:
Tom Curry, Interim City Attorney




ATTACHMENT 1

Legal Description of the Property

[To be inserted]


ATTACHMENT 2

PROMISSORY NOTE
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
GAP ASSISTANCE FOR THE AFFORDABLE HOUSING PROGRAM (GAP)

Not to Exceed , 20__
$ Brentwood, California
NOTICE TO BORROWER: THE LOAN EVIDENCED BY THIS NOTE IS SECURED BY A DEED OF TRUST THAT PROVIDES FOR A LUMP SUM PAYMENT OF PRINCIPAL AND INTEREST AT MATURITY.

FOR VALUE RECEIVED, , ("Borrower"), having an address of , promises to pay the CITY OF BRENTWOOD, having an address of 150 City Park Way, Brentwood, CA 94513 ("City"), the principal sum of DOLLARS ($ ), pursuant to the terms and conditions set forth below.
1. Loan. This Promissory Note (the "Note") is made pursuant to Section 3.1 of that certain Loan Agreement (the "Agreement") between Borrower and City, dated , 20__. This is a promissory note for the repayment to City of the Dollar ($ ) loan provided by City to Borrower (the "Loan") in order to enable Borrower to purchase that certain real property described in Attachment 1 of the Agreement (the "Property"). Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement.
2. Disbursement. The Loan shall be disbursed in accordance with and subject to the Conditions Precedent to Loan Disbursement set forth in Section 4 of the Agreement.
3. Deed of Trust. Payment of this Note is secured by a deed of trust, security agreement and fixture filing (the "Deed of Trust") executed by Borrower to , as Trustee, for the benefit of City, which Deed of Trust shall be recorded against the Property.
4. Repayment. So long as Borrower is not in default under this Note or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal and interest of the Loan shall be due and payable in full on the earlier of: (a) the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part; or (b) on [insert maturity date of first loan]. (the "Maturity Date").
5. Interest. The Loan shall bear simple interest at a rate of three percent per annum from the date of disbursement.

6. Place of Payment. Payment shall be made in lawful money of the United States to City, City of Brentwood at the following address: 150 City Park Way, Brentwood, California 94513. The place of payment may be changed from time to time as the City may designate in writing.

7. Non-Negotiability; Transfer. This Note is non-negotiable and not transferable by Borrower. Borrower, at its option, may negotiate transfer or assumption of this Note.
8. Prepayment. Borrower shall have the right to prepay, at any time and from time to time, all or any portion of the amounts owing under this Note without any premium or penalty.
9. Event of Default. The occurrence of any of the following shall constitute an event of default under this Note: (a) Borrower fails to pay any amount due hereunder within ten calendar days of its due date; or (b) any default by Borrower under the Deed of Trust, the Agreement, the Resale Restriction Agreement or any other loan or other document affecting the Property, including, but not limited to, refinancing the Loan in violation of the terms of the Agreement, subject to any applicable cure periods provided therein.
10. Payment Upon Default. At the option of City and without notice, the entire unpaid principal and interest owing on this Note shall become immediately due and payable (a) upon the occurrence of any event of default, or (b) upon the sale, transfer, assignment, conveyance or lease of the Property, in whole or in part, prior to repayment of the principal and interest owing on this Note. This option may be exercised at any time following any such event, and the acceptance of one or more installments thereafter shall not constitute a waiver of City's option. City's failure to exercise such option shall not constitute a waiver of such option with respect to any subsequent event. City's failure in the exercise of any other right or remedy hereunder or under any agreement which secures the indebtedness or is related thereto shall not affect any right or remedy and no single or partial exercise of any such right or remedy shall preclude any further exercise thereof.
11. Interest Upon Default. At all times when Borrower is in default hereunder by reason of Borrower's failure to pay principal or interest due under this Note or any amounts due under any loan documents securing this Note, the interest rate on the sums as to which Borrower is in default, shall be the lower of the highest rate then allowed by law or five percent over the prime interest rate announced by Bank of America N.T.&S.A., as of the date of the default. If Bank of America N.T.&S.A. no longer exists or fails to announce a prime interest rate, the prime interest rate announced by the largest bank, in terms of total assets, of the member banks of the Eleventh District Federal Reserve Bank that announce a prime interest rate, shall be applicable for purposes of this section.
12. Waiver of Presentment. Borrower and any endorsers hereof and all others who may become liable for all or any part of this obligation, severally waive presentment for payment, demand and protest and notice of protest, and of dishonor and nonpayment of this Note, and expressly consent to any extension of the time of payment hereof or of any installment hereof, to the release of any party liable for this obligation, and any such extension or release may be made without notice to any of said parties and without any way affecting or discharging this liability.
13. Attorney Fees. Borrower agrees to pay immediately upon demand all costs and expenses of City including reasonable attorneys' fees, (a) if after an event of default this Note is placed in the hands of an attorney or attorneys for collection, (b) if after an event of default hereunder, City finds it necessary or desirable to secure the services or advice of one or more attorneys with regard to collection of this Note against Borrower, any guarantor or any other party liable therefor or to the protection of its rights under this Note, the Deed of Trust, the Agreement, or other loan document, or (c) if City seeks to have the Property abandoned by or reclaimed from any estate in bankruptcy, or attempts to have any stay or injunction prohibiting the enforcement or collection of the Note or prohibiting the enforcement of the Deed of Trust or any other agreement evidencing or securing this Note lifted by any bankruptcy or other court. If City shall be made a party to or shall reasonably intervene in any action or proceeding, whether in court or before any governmental Agency, affecting the Property or the title thereto or the interest of the City under the Deed of Trust, including, without limitation, any form of condemnation or eminent domain proceeding, City shall be reimbursed by Borrower immediately upon demand for all costs, charges and attorneys' fees incurred by City in any such case, and the same shall be secured by the Deed of Trust as a further charge and lien upon the Property.
14. Notices. All notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, or (iii) delivered by overnight courier service. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery if the intended recipient refuses to accept delivery). All such notices shall be delivered to the addresses set forth above, or to such other address as the receiving party may from time to time specify by written notice to the other party.
15. Successors and Assigns. This Note shall be binding upon Borrower, its successors and assigns.
16. Governing Law. This Note shall be construed in accordance with and be governed by the laws of the State of California, without regard to conflict of laws principles.
17. Severability. If any provision of this Note is declared invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.
18. Construction with Agreement. In the event of any inconsistency between this Note and the Agreement, the terms of this Note shall prevail.
19. Joint and Several Liability. All covenants and agreements of Borrower shall be joint and several obligations.




BORROWER





By:

Name:

By:

Name:
ATTACHMENT 3

Deed of Trust


RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City of Brentwood
150 City Park Way
Brentwood, California 94513
Attn: Housing Manager ))))))))
)
This document is exempt from the payment of a recording fee pursuant to Government Code § 6103.

DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
GAP ASSISTANCE FOR THE AFFORDABLE HOUSING PROGRAM (GAP)

NOTICE TO BORROWER: THE LOAN SECURED BY THIS DEED OF TRUST PROVIDES FOR A LUMP SUM PAYMENT OF PRINCIPAL AND INTEREST AT MATURITY.

This Deed of Trust, Security Agreement and Fixture Filing is made as of , among , ("Borrower"), whose address is , , a ("Trustee"), whose address is , and the City of Brentwood, a California municipal corporation ("City"), whose address is 150 City Park Way, Brentwood, California 94513.

Borrower irrevocably grants, conveys, transfers and assigns to Trustee in trust, with power of sale and right of entry and possession, all of Borrower's estate, right, title and interest in, to and under the following property (collectively, "Property"): (a) the real property in Contra Costa County, California, described on Exhibit A attached hereto and incorporated herein by this reference, together with all existing and future easements and rights affording access to it ("Land"), (b) together with all buildings, structures and improvements now existing or hereafter constructed thereon ("Improvements"), (c) together with all articles of personal property now or hereafter attached to, placed upon for an indefinite term, or used in connection with the Land and/or Improvements, together with all goods and other property that are, or at any time become, so related to the Property that an interest in them arises under real estate law, or they are otherwise adjudged to be a "fixture" under applicable law (each a "Fixture," collectively "Fixtures"), (d) together with all other property and interests of any kind or character which may be reasonably necessary or desirable to promote the present and future beneficial use and enjoyment of such real property and improvements.

1. Secured Obligations. Borrower makes the grant, conveyance, transfer and assignment herein for the purpose of securing the following obligations ("Secured Obligations"): (a) payment of the sum of DOLLARS ($ ) together with interest on the unpaid principal balance according to the terms of a promissory note ("Note") of even date herewith and the Loan Agreement ("Loan Agreement") dated _______________, by and between Borrower and City and any amendment, modification, extension, rearrangement, restatement, replacement, substitution or renewals thereof; (b) payment of such further sums as the then record owner of the Property may borrow from City, when evidenced by a promissory note or notes reciting that they are secured by this Deed of Trust; and (c) performance of each agreement of Borrower incorporated by reference or contained herein or in the Note or the Loan Agreement.

2. Maintenance and Repair. Borrower shall (a) keep the Property in good condition and repair and not remove or demolish any building; (b) complete or restore promptly and in good and workmanlike manner any building which may be constructed, damaged or destroyed; (c) pay when due all claims for labor performed and materials furnished; (d) comply with all laws affecting the Property or requiring any alterations or improvements to be made; (e) not commit or permit waste; (f) cultivate, irrigate, fertilize, fumigate, prune and do all other acts which from the character or use of the Property may be reasonably necessary; and (g) not cause or permit any Hazardous Materials (as hereinafter defined) to be brought upon, kept or used in or about the Property by Borrower, its agents, employees, contractors or invitees. If Borrower breaches the obligations stated in this Section 2, then Borrower shall indemnify, defend (with counsel approved by City) and hold City harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in value of the Property, and sums paid in settlement of claims, attorneys' fees, consultant fees and expert fees) which arise during or after the term of this Deed of Trust as a result of such breach, contamination, discharge, or release. This indemnification of City by Borrower includes, without limitation, costs incurred in connection with any investigation of site conditions or any cleanup, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of Hazardous Materials present in, on or under the Property or adjacent property caused by, or as a result of, Borrower's activities. This indemnification specifically excludes Hazardous Materials brought on the Property by prior occupants. For the purpose of this Section 2, the term "Hazardous Materials" includes, without limitation, any flammable explosives, radioactive materials, hazardous materials, hazardous wastes, hazardous or toxic substances, or related materials defined in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. §9601 et seq.), the Hazardous Materials Transportation Act, as amended (49 U.S.C. §1801 et seq.), the Resource Conservation and Recovery Act of 1976, as amended (42 U.S.C. §6901 et seq.), Section 25117 of the California Health & Safety Code, Section 25316 of the California Health & Safety Code, and in the regulations adopted and publications promulgated pursuant to them, or any other federal, state, or local environmental laws, ordinances, rules, or regulations concerning the environment, industrial hygiene or public health or safety now in effect or enacted after this date.

3. Insurance. Borrower shall maintain hazard insurance against loss by fire, hazards included with the term "extended coverage," and any other hazards for which City requires insurance, and liability insurance. The insurance carrier and the insurance policies and amounts of coverage shall be acceptable to City, the policies shall name City as a loss payee or an additional insured, as applicable, the policies shall include City as an additional insured, as applicable, and shall require 30 calendar days' prior notice to City before the policy is modified or terminated.

4. Defense of Security. Borrower shall appear in and defend any action or proceeding purporting to affect the security or the rights or powers of City or Trustee. Borrower shall pay all costs and expenses, including costs of evidence of title and attorneys' fees, in any such action or proceeding in which Trustee or City may appear, and in any suit brought by City to foreclose this Deed of Trust.

5. Payment of Taxes and Liens. Borrower shall pay (a) at least 10 calendar days before delinquency, all taxes and assessments affecting the Property, including water stock assessments; (b) when due, all encumbrances, charges and liens, with interest, on the Property; and (c) upon demand all costs, fees and expenses of this Deed of Trust. If Borrower fails to make any payment or to do any act provided for in this Deed of Trust, then City or Trustee may, without obligation to do so, and with or without notice to or demand upon Borrower, and without releasing Borrower from any obligation under this Deed of Trust: (w) make or do the same in such manner and to such extent as either may deem necessary to protect the security, City or Trustee being authorized to enter upon the Property for such purposes; (x) appear in or commence any action or proceeding purporting to affect the security, or the rights or powers of City or Trustee; (y) pay, purchase, contest or settle any encumbrance, charge or lien which in the judgment of either appears to be senior to this Deed of Trust; and (z) in exercising any such powers, pay allowable expenses, including attorneys' fees.

6. Reimbursement of Costs. Borrower shall pay upon demand all sums expended by City or Trustee provided for in this Deed of Trust or allowed by law, with interest from date of expenditure at the maximum rate provided in the Note.

7. Borrower Not Released; Forbearance by City Not a Waiver. By accepting payment of any sum after its due date, City does not waive its right either to require prompt payment when due of all other sums or declare a default for failure to pay. Extension of the time for payment, acceptance of a renewal note or notes, release of any person from liability, modification of the payment terms and conditions, or modification or amortization of the sums secured by this Deed of Trust granted by City to any successor in interest of Borrower shall not operate to release, in any manner, the liability of the original Borrower and Borrower's successors in interest. City shall not be required to commence proceedings against such successor or refuse to extend time for payment, accept a renewal note or notes, release any person from liability, otherwise modify the payment terms and conditions, or modify amortization of the sums secured by this Deed of Trust by reason of any demand made by the original Borrower and Borrower's successors in interest. Any forbearance by City in exercising any right or remedy hereunder, or otherwise afforded by applicable law, shall not be a waiver of or preclude the exercise of any such right or remedy.

8. Reconveyance. That upon written request of City stating that all sums secured hereby have been paid, and upon surrender of this Deed of Trust and the 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 grantee in such reconveyance may be described as "the person or persons legally entitled thereto."

9. Occupancy of Property; No Rental. Borrower shall occupy, establish and maintain the use of the Property as Borrower's principal residence throughout the term of the Note securing this Deed of Trust. There shall be no rental of the Property.

10. Default and Foreclosure. Upon default by Borrower in payment or performance of any Secured Obligation, subject to any applicable cure period, City may declare all sums secured immediately due and payable by delivery to Trustee of a declaration of default and demand for sale and of a notice of default and of a notice of sale, which notice Trustee shall cause to be filed for record. City also shall deposit with Trustee this Deed of Trust, said Note and all documents evidencing expenditures secured by this Deed of Trust. Upon default of any obligation secured by this Deed of Trust and acceleration of all sums due, City may instruct Trustee to proceed with a sale of the Property under the power of sale granted in this Deed of Trust, noticed and held in accordance with California Civil Code Sections 2924, et seq., as such statutes may be amended from time to time. Borrower waives all rights it may have to require marshaling of assets or to require sales of assets in any particular order, including any rights under California Civil Code Sections 2899 and 3455.

11. Substitution of Trustee. City, or any successor in ownership of any Secured Obligations, may from time to time, by instrument in writing, substitute a successor or successors to any Trustee named herein or acting hereunder, which instrument executed by the City and duly acknowledged and recorded in the Contra Costa County Recorder's Office, 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 Borrower, Trustee and City hereunder, the book and page where this Deed of Trust is recorded and the name and address of the new Trustee.

12. Successors and Assigns. This Deed of Trust applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns. The term "City" shall mean the owner and holder, including pledgees, of the Note, whether or not named as City herein.

13. Trustee Acceptance. Trustee accepts this trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. Trustee is not obligated to notify any party hereto of pending sale under any other deed of trust or of any action or proceeding in which Borrower, City or Trustee shall be a party unless brought by Trustee.


14. Further Assurances. Borrower shall, at its own cost and expense, do, execute, acknowledge, and deliver all and every such further acts, deeds, conveyances, mortgages, assignments, notices of assignments, transfers, and assurances as Trustee or City shall from time to time require, for better assuring, conveying, assigning, transferring, and confirming unto Trustee the Property and rights hereby conveyed or assigned or intended now or hereafter so to be, or which Borrower may be or may hereafter become bound to convey or assign to Trustee, or for carrying out the intention or facilitating the performance of the terms of this Deed of Trust, or for filing, registering, or recording this Deed of Trust. Borrower shall, on demand, execute and deliver, and hereby authorizes Trustee and City, or either of them, to execute in the name of Borrower, to the extent it may lawfully do so, one or more financing statements, chattel mortgages, or comparable security instruments, to evidence more effectively the lien hereof. Immediately upon the execution and delivery of this Deed of Trust, and thereafter from time to time, Borrower shall cause this Deed of Trust, and any security instruments creating a lien or evidencing the lien hereof upon any property and each instrument of further assurance, to be filed, registered, or recorded in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to protect the lien hereof upon, and the title of Trustee to, the Property encumbered hereby.

15. Condemnation and Insurance Proceeds. Immediately upon obtaining knowledge of the institution of any proceedings for the condemnation or other taking of all or any portion of the Property, or knowledge of any casualty damage to the Property, or damage in any other manner, Borrower shall immediately notify City thereof. Borrower hereby authorizes and empowers City as attorney-in-fact for Borrower to make proof of loss, to adjust and compromise any claim under the insurance policies covering the Property, to appear in and prosecute any action arising from such insurance policies, to collect and receive insurance proceeds, and to deduct therefrom City's expenses incurred in the collection of such proceeds; provided, however, that nothing contained in this Section shall require City to incur any expense or take any action hereunder. Borrower hereby authorizes and empowers City, at City's option, as attorney-in-fact for Borrower, to commence, appear in and prosecute, in City's or Borrower's name, any action or proceeding relating to any condemnation or other taking of all or any part of the Property, whether direct or indirect, and to settle or compromise any claim in connection with such condemnation or other taking. The proceeds of any award payment or claim for damages, direct or consequential, in connection with any condemnation or other taking, whether direct or indirect, of the Property, or any part thereof, or for conveyances in lieu of the Property, or any part thereof, shall be paid to City. The foregoing powers of attorney are coupled with an interest and are irrevocable. Borrower hereby authorizes City to apply such awards, payments, proceeds or damages relating to condemnation of the Property and insurance covering the Property, after the deduction of City's expenses incurred in the collection of such amounts, subject to the requirements of applicable law and the provisions hereof, to restoration or repair of the Property or to payment of the sums secured by this Deed of Trust. City shall be under no obligation to question the amount of any compensation, awards, proceeds, damages, claims, rights of action, and payments relating to condemnation or other taking of the Property or insured casualty affecting the Property, and may accept the same in the amount in which the same shall be paid. Borrower shall execute such further evidence of assignment of any awards, proceeds damages or claims arising in connection with such condemnation or taking or such insurance as City may require. Notwithstanding the above, the City shall release all insurance and condemnation proceeds to Borrower to be used to reconstruct the improvements on the Property provided that City determines that such restoration, repair or rebuilding is economically feasible. If such insurance proceeds shall be insufficient for such purposes, Borrower shall make up the deficiency. If the Property is subject to a partial condemnation or taking, then the proceeds received therefrom shall be applied to restore the Property taken, provided the City determines that such restoration is economically feasible and no default exists under the Loan Agreement, the Note, this Deed of Trust, and all other instruments or agreements required to be executed by Borrower or any guarantor in connection with the Loan (collectively, "Loan Documents") following the expiration of all applicable cure periods. If the Property is subject to a total condemnation, or if City determines that restoration of the Property is not feasible following a partial condemnation, or if a default exists then the proceeds from any condemnation award or claim for damages shall be used first to repay all sums under the Note, with the excess, if any, paid to Borrower.

16. Estoppel Certificate. Borrower shall, within ten calendar days of a written request from City, furnish City with a written statement, duly acknowledged, setting forth the sums secured by this Deed of Trust and any right of set-off, counterclaim or other defense which exists against such sums and the obligations of this Deed of Trust.

17. California Uniform Commercial Code Security Agreement; Fixture Filing. Borrower hereby grants City a security interest in all fixtures of Borrower now owned or hereafter in existence, acquired or created on, of or relating to the Property, and all substitutions, replacements, additions, accessions and proceeds (including insurance proceeds) of all of the foregoing (collectively, "Secured Property"). City may file this Deed of Trust, or a reproduction hereof, in the real estate records or other appropriate index, as a financing statement for the Secured Property. Any reproduction of this Deed of Trust or of any other security agreement or financing statement shall be sufficient as a financing statement. In addition, Borrower shall execute and deliver to City, upon City's request, any financing statements, as well as extensions, renewals and amendments thereof, and reproductions of this Deed of Trust in such form as City may require to perfect a security interest with respect to the Secured Property. Borrower shall pay all costs of filing such financing statements and any extensions, renewals, amendments and releases thereof, and shall pay all reasonable costs and expenses of any record searches for financing statements City may reasonably require. Without the prior written consent of City, Borrower shall not create or suffer to be created pursuant to the California Uniform Commercial Code any other security interest in the Secured Property. Upon Borrower's breach of any covenant or agreement of Borrower contained in this Deed of Trust, including the covenants to pay when due all sums secured by this Deed of Trust, City shall have the remedies of a secured party under the California Uniform Commercial Code and, at City's option, may also invoke any remedies provided in this Deed of Trust as to the Secured Property. In exercising any of such remedies, City may proceed against the Property and any of the Secured Property separately or together and in any order whatsoever, without in any way affecting the availability of City's remedies under the California Uniform Commercial Code or the remedies provided in the Deed of Trust. This Deed of Trust also covers goods which are or which are to become fixtures on the Property and constitutes and is filed as a fixture filing under the California Uniform Commercial Code.

18. Due-On-Sale or Encumbrance. If all or any part of the Property, or any interest therein, or any beneficial interest in Borrower (if Borrower is not a natural person or persons but is a corporation, partnership, trust, limited liability company or other legal entity), is sold, transferred, mortgaged, assigned, pledged, or further encumbered, whether directly or indirectly, whether voluntarily or involuntarily or by operational law, City may, at City's option, declare all of the sums secured by this Deed of Trust to be immediately due and payable, and City may invoke any remedies permitted by this Deed of Trust.

19. Subordination. City and Borrower acknowledge and agree that this Deed of Trust is subject and subordinate in all respects to the liens, terms, covenants and conditions of the senior deed of trust in favor of in the amount of DOLLARS ($ ) existing as of the date hereof (“Senior Deed of Trust"), and to those advances heretofore made or which may hereafter be made pursuant to the Senior Deed of Trust for the purpose of protecting or further securing the lien of the Senior Deed of Trust, or curing defaults by the Borrower under the Senior Deed of Trust. Borrower may refinance the loan secured by the Senior Deed of Trust only in accordance with Section 3.3 of the Loan Agreement. Notwithstanding anything to the contrary in the Note, Loan Agreement, or this Deed of Trust, the status of this Deed of Trust as a lien and security interest on the Property shall be second only to the Senior Deed of Trust.

20. No Discrimination. Borrower covenants that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, sexual preference, age, marital status, physical handicap, medical condition, disability, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, nor shall the Borrower itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the Property.

21. Authorization; Joint and Several. Each individual or entity executing this Deed of Trust on behalf of Borrower represents and warrants that he or she or it is duly authorized to execute and deliver this Deed of Trust on behalf of Borrower and that such execution is binding upon Borrower. If Borrower consists of more than one person, the obligation of all such persons shall be joint and several, with each person who signs this Deed of Trust being fully and personally obligated to keep all of the promises made in this Deed of Trust, including the promise to pay the full amount owed. City, in City's sole discretion, may enforce its rights under this Deed of Trust against any person individually or against all Borrowers together.

22. Waiver of Statute of Limitations. The pleading of any statute of limitations as a defense to the obligations evidenced by this Deed of Trust is waived to the fullest extent permissible by law.

23. Notices. All notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, or (iii) delivered by overnight courier service. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery if the intended recipient refuses to accept delivery). All such notices shall be delivered to the addresses set forth above, or to such other address as the receiving party may from time to time specify by written notice to the other parties.

24. Remedies. In the event of default under the Loan Documents, City may exercise any right or remedy which it has under any or all of the Loan Document(s), or which is otherwise available at law or in equity or by statute, and all of City's rights and remedies shall be cumulative.

25. Modifications. Any waiver, change, modification or discharge of this Deed of Trust may be made only by the prior written consent of City and Borrower. No alteration, amendment or waiver of any provision of this Deed of Trust, or any other agreement or instrument evidencing or providing security for this Deed of Trust, made by agreement of City, the holder hereof or any other person or party, shall constitute a waiver of any other term hereof, or otherwise release or discharge the liability of Borrower under this Deed of Trust.

26. Severability; Construction; Governing Law. If any provision of this Deed of Trust or the application of any such provision shall be held by a court of competent jurisdiction to be invalid, void or unenforceable to any extent, the remaining provisions of this Deed of Trust and the application thereof shall remain in full force and effect and shall not be affected, impaired or invalidated. This Deed of Trust shall be construed and enforced in accordance with the laws of the State of California without reference to its choice of laws principles. Section headings have been inserted solely as a matter of convenience and are not intended to define or limit the scope of any of the provisions contained therein.

27. Integration. The Note, this Deed of Trust, and the Loan Agreement embody the agreement between City and Borrower for the Loan and its terms and conditions. If any term of this Deed of Trust is inconsistent with any term of the Note or the Loan Agreement, the terms of the Note shall govern.

The undersigned Borrower requests that a copy of any Notice of Default and of any Notice of Sale hereunder be mailed to Borrower at Borrower's address hereinbefore set forth.


BORROWER




By:

Name:

By:

Name:



EXHIBIT A

The real property referred to herein is situated in the City of Brentwood, Contra Costa County, California, and is commonly known as , and more particularly described as follows:

[To be inserted]


STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On , 200 , before me, , the undersigned, personally appeared ,
( ) personally known to me
( ) 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.
WITNESS my hand and official seal:
Signature:


STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On , 200 , before me, , the undersigned, personally appeared ,
( ) personally known to me
( ) 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.
WITNESS my hand and official seal:
Signature:




LOAN AGREEMENT
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
DOWNPAYMENT ASSISTANCE PROGRAM (DAP)
INDIVIDUAL DEVELOPMENT ACCOUNTS (IDA)

This Loan Agreement ("Agreement") is entered into as of , 20 , by and between the City of Brentwood, a municipal corporation ("City") and , ("Borrower").
RECITALS

A. City has established a First Time Homebuyer Assistance Program ("Program") for the benefit of first time homebuyers purchasing homes within the City of Brentwood and earning up to 120 percent of the Area Median Income (as calculated by the State of California, Department of Housing and Community Development).

B. Borrower has applied for a Downpayment Assistance Program loan to assist in Borrower's purchase of the real property commonly known and described as [insert address], Brentwood, California, and more particularly described in Attachment 1, attached hereto (the "Property"). A residence that will be the principal residence of Borrower is located on the Property (the "Residence").

C. Borrower has also applied for an Individual Development Account loan and has saved approximately toward the cost of homeownership.

D. The parties wish to enter into this Agreement to define the rights and obligations of City and Borrower with respect to the Loans (as defined below).
NOW, THEREFORE, City and Borrower agree as follows:
AGREEMENT
19. Definitions.
"Agreement" means this Loan Agreement between Borrower and City.
"Borrower" means .
"City" means the City of Brentwood, a municipal corporation.
"Conditions Precedent to Disbursement of Loans" is defined in Section 4.
"DAP Loan" is defined in Section 2.1.
"DAP Maturity Date" is defined in Section 2.1(a).
"DAP Note" is defined in Section 3.1 below.
"DAP Term" is defined in Section 2.1(a).
"Deed of Trust" is defined in Section 3.2 below.
"Escrow Holder" means [insert name of escrow company], the escrow holder handling the purchase of the Property by Borrower.
"Event of Default" is defined in Section 7.1 below.
"First Loan" is defined in Section 3.3 below.
"IDA Loan" is defined in Section 2.2.
"IDA Maturity Date" is defined in Section 2.2(a).
"IDA Note" is defined in Section 3.1 below.
"IDA Term" is defined in Section 2.2(a).
"Lender's Policy of Title Insurance" is defined in Section 4.3.
"Loans" means the DAP Loan and the IDA Loan.
"Loan Documents" are the DAP Note, the IDA Note and the Deed of Trust.
"Permitted Exceptions" is defined in Section 3.2 below.
"Program" is defined in Recital A.
"Property" is defined in Recital B.
"Ownership Interest" means and includes fee simple, joint tenancy, tenancy in common, life estate, shareholder in a cooperative or interest held in trust for Borrower that would continue on ownership if held by the Borrower.
"Residence" is defined in Recital B.
"Senior Deed of Trust" is defined in Section 3.2 below.

20. Loans.
20.1. DAP Loan. Subject to the terms and conditions set forth herein, City agrees to loan Borrower a principal amount not to exceed $ (the "DAP Loan") to enable Borrower to purchase the Property.
(a) Term of DAP Loan; Commencement and Maturity Date. The term (the "DAP Term") of the DAP Loan shall commence on the date of execution of the DAP Note and shall end on the earlier of: (a) the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part; or (b) on [insert maturity date of first loan] (the "DAP Maturity Date").
(b) Repayment of the DAP Loan. So long as Borrower is not in default under this Agreement or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal and interest of the DAP Loan shall be due and payable in full on the DAP Maturity Date. The DAP Loan may be prepaid at any time without penalty.
(c) Interest. Interest on the DAP Loan shall accrue as follows:
(1) DAP Term of Less than Three Years. If the DAP Term is less than three years, the DAP Loan shall bear simple interest at a rate of seven percent per annum from the date of disbursement.
(2) DAP Term of Three to Ten Years. If the DAP Term is between three and ten years, the DAP Loan shall bear simple interest at a rate of five percent per annum from the date of disbursement.
(3) DAP Term of More than Ten Years. If the DAP Term is more than ten years, the DAP Loan shall bear simple interest at a rate of three percent per annum from the date of disbursement.
20.2. IDA Loan. Subject to the terms and conditions set forth herein, City agrees to loan Borrower a principal amount not to exceed $ (the "IDA Loan") to enable Borrower to purchase the Property.
(a) Term of IDA Loan; Commencement and Maturity Date. The term (the "IDA Term") of the IDA Loan shall commence on the date of execution of the IDA Note and shall end on the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part (the "IDA Maturity Date"). If the IDA Term is more than ten years, the IDA Loan shall be fully forgiven and no payments shall be due thereunder.
(b) Repayment of the IDA Loan. So long as Borrower is not in default under this Agreement or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal of the IDA Loan shall be due and payable in full on the IDA Maturity Date. However, in the event that the IDA Term is five years or longer, all or part of the IDA Loan will be forgiven as follows:
(1) If the IDA Term is between five and six years, 50 percent of the IDA Loan will be forgiven.
(2) If the IDA Term is between six and seven years, 60 percent of the IDA Loan will be forgiven.
(3) If the IDA Term is between seven and eight years, 70 percent of the IDA Loan will be forgiven.
(4) If the IDA Term is between eight and nine years, 80 percent of the IDA Loan will be forgiven.
(5) If the IDA Term is between nine and ten years, 90 percent of the IDA Loan will be forgiven.
(6) If the IDA Term is over ten years, the entirety of the IDA Loan will be forgiven.
(c) Interest. The IDA Loan shall bear no interest.
20.3. Use of Proceeds; Disbursement to Escrow Holder. Proceeds of the Loans shall be used only for the purchase of the Property and payment of closing and escrow costs required to be paid by Borrower pursuant to section 4.6 below. Upon satisfaction or waiver by City of all of the Conditions Precedent to Disbursement of the Loans set forth in section 4 below, City shall deliver the proceeds of the Loans to the Escrow Holder, to be applied directly to the purchase of the Property. In no event shall the proceeds of the Loans be disbursed to Borrower.
21. Notes, Security Documents and Refinancing.
21.1. Promissory Notes. As evidence of Borrower's obligation to repay the DAP Loan, Borrower shall execute and deliver to the Escrow Holder, a promissory note in favor of City in the form attached hereto as Attachment 2 (the "DAP Note"). As evidence of Borrower's obligation to repay the IDA Loan, Borrower shall execute and deliver to the Escrow Holder, a promissory note in favor of City in the form attached hereto as Attachment 3 (the "IDA Note").
21.2. Deed of Trust Encumbering Property. As security for Borrower's performance of its obligations hereunder, Borrower shall execute and deliver to the Escrow Holder, a recordable Deed of Trust in favor of City in the form attached hereto as Attachment 4 (the "Deed of Trust"). The Deed of Trust shall be subject and subordinate only to (a) the deed(s) of trust made by Borrower to [insert name of primary lenders], the first lender(s) (the "Senior Deed of Trust"); (b) the lien for current real property taxes not yet due and payable; and (c) existing easements over the Property for public utilities and other purposes (the "Permitted Exceptions").
21.3. Refinancing. Borrower shall not refinance the loan(s) secured by the Senior Deed of Trust (the "First Loan") without the prior written approval of City. City shall approve refinancing if it is solely to achieve a lower interest rate. However, City shall not approve any refinancing that results in any release of funds to Borrower, typically referred to as a "cash-out" loan, unless Borrower agrees to repay the Loans, plus accrued interest, with the proceeds.
22. Conditions Precedent to Disbursement of the Loans. City's obligation to disburse the Loans is conditioned upon the satisfaction or waiver by City of each and all of the conditions precedent described below (the "Conditions Precedent to Disbursement of the Loans"), which are solely for the benefit of City.
22.1. No Default. Subject to the expiration of any applicable cure period, Borrower shall not be in default of any of its obligations under the terms of this Agreement and all representations and warranties of Borrower contained herein shall be true and correct.
22.2. Execution of Loan Documents. Borrower shall have executed the Notes and shall have executed and acknowledged the Deed of Trust in recordable format.
22.3. Lender's Policy of Title Insurance. Escrow Holder shall be unconditionally and irrevocably committed to issuing a CLTA Lender's policy of title insurance to City insuring City in the principal amount of the Loans and the validity and priority of the Deed of Trust as a lien upon the Property, subject only to the Permitted Exceptions, and showing fee simple title to the Property in the name of Borrower ("Lender's Policy of Title Insurance").
22.4. Prepared to Close Escrow. Borrower shall have executed and acknowledged, where necessary, all documents and shall be in a position to close escrow on the Property.
22.5. Recordation of Documents. The Deed of Trust shall have been recorded against the Property in the Contra Costa County Recorder's Office.
22.6. Payment of Escrow Fees and Costs. Borrower shall have paid all escrow fees and closing costs for the purchase of the Property and the premium for the Lender's Policy of Title Insurance, which may be paid for out of the proceeds of the Loans.
23. Representations and Warranties. Borrower represents and warrants that the matters addressed in subsections 5.1 through 5.9 below are true and correct.
23.1. No Conflicts. The execution, delivery, and performance of this Agreement and of any instrument or agreement required by this Agreement are not in conflict with any law or any indenture, agreement, or undertaking to which Borrower is a party or by which Borrower is bound or affected.
23.2. Enforceability. This Agreement is a legal, valid and binding agreement of Borrower, enforceable against Borrower in accordance with its terms, and any instrument or agreement required under this Agreement, when executed and delivered, will be similarly legal, valid, binding and enforceable.
23.3. No Event of Default. No event has occurred and is continuing or would result from the extension of credit under this Agreement which constitutes or would constitute an Event of Default or which, upon a lapse of time or notice or both, would become an Event of Default.
23.4. Other Obligations. Borrower is not in default under any other agreement involving the borrowing of money, the extension of credit, or the lease of real or personal property to which Borrower is a party as borrower, guarantor, installment purchaser or lessee.
23.5. No Other Liens. Other than the Senior Deed of Trust, Borrower is not encumbering the Property with any other lien, deed of trust or security interest.
23.6. First Time Homebuyer. Borrower has not had any Ownership Interest in the State of California in his, her or their primary residence in the three years preceding the date of application to participate in the Program, except for an Ownership Interest in a primary residence that was terminated or extinguished due to divorce or marital dissolution.
23.7. Application Information. All of the information provided by Borrower in the Program loan applications, including, without limitation, income criteria, is true and accurate.
23.8. Attended Class. Borrower has attended a First Time Homebuyer Education Class offered by City or City's designee.
23.9. IDA Savings. Borrower saved the amount of from to [insert dates during which Borrower saved funds] toward the purchase of the Property.
24. Covenants. Borrower promises to keep each of the covenants set forth below, unless City has waived compliance in writing.
24.1. Compliance with Laws. Borrower shall at all times comply with, or cause to be complied with, all federal, state and local laws, statutes, rules, regulations, ordinances, orders and directions affecting the Property.
24.2. Occupy as Principal Residence. Borrower shall occupy the Residence as Borrower's principal residence and shall reside in the Residence on a full-time basis.
24.3. Taxes and Other Liabilities. Borrower shall pay all taxes and other governmental or regulatory assessments assessed and levied against the Property at least ten calendar days prior to delinquency and shall timely file all required tax returns.
24.4. Liens and Other Indebtedness. Other than the Senior Deed of Trust, Borrower shall not encumber the Property with any other lien, deed of trust or security interest without the prior written approval of City.
24.5. Refinancing. Borrower shall comply with the refinancing provisions set forth in Section 3.3 above.
24.6. No Lease. Borrower shall not assign or lease the whole or any part of the Property.
24.7. Attend Classes. Borrower shall attend any follow-up First Time Homebuyer Education Classes offered by City or City's designee.
25. Default and Remedies.
25.1. Events of Default. The occurrence of any of the following events, and the continuation thereof beyond the corresponding cure period (if any) set forth below, shall constitute an "Event of Default" under this Agreement:
(a) Borrower fails to make any payment as and when due under the Loan Documents, where such failure continues beyond ten (10) calendar days after written notice from City specifying the general nature and the amount of the overdue payment.
(b) Borrower fails to comply with any provision contained in this Agreement or the Loan Documents, other than provisions governing repayment of the Loans, and does not cure that failure within 30 calendar days after written notice from City.
(c) Any representation or warranty of Borrower set forth in this Agreement or the Loan Documents, or any information delivered by Borrower to City pursuant to this Agreement, proves to be false or misleading in any material respect.
(d) Under any of the Loan Documents, an event of default or default (as defined in that document) occurs.
25.2. Remedies. If an Event of Default occurs under this Agreement or any of the Loan Documents, City may exercise any right or remedy which it has under any of the documents, or which is otherwise available at law, in equity or by statute, and all of City's rights and remedies shall be cumulative. Upon the occurrence of any Event of Default, all of Borrower's obligations under the Loan Documents may become immediately due and payable without notice of default, presentment or demand for payment, protest or notice of nonpayment or dishonor, or other notices or demands of any kind or character, all at City's option, exercisable in its sole discretion.
25.3. Interest Upon Event of Default. At all times when Borrower is in default by reason of Borrower's failure to pay principal or interest due under this Agreement, the interest rate on the sums to which Borrower is in default, shall be the lower of the highest rate then allowed by law or five percent over the prime interest rate announced by Bank of America N.T.&S.A., as of the date of the Event of Default. If Bank of America N.T.&S.A. no longer exists or fails to announce a prime interest rate, the prime interest rate announced by the largest bank, in terms of total assets, of the member banks of the Eleventh District Federal Reserve Bank that announce a prime interest rate, shall be applicable for purposes of this section 7.3.
26. No Assignment. The qualifications and identity of Borrower are of particular concern to City. It is because of those unique qualifications and identity that City has entered into this Agreement with Borrower. No voluntary or involuntary successor in interest of Borrower shall acquire any of Borrower's rights or powers under this Agreement.
27. Miscellaneous.
27.1. Joint and Several Liability. All covenants and agreements of Borrower shall be the joint and several obligations of all signatories, makers, sureties, guarantors and endorsers and shall be binding upon them.
27.2. Further Assurances. The parties shall execute, acknowledge, file or record such other instruments and statements and shall take such additional action as may be necessary to carry out the purpose and intent of this Agreement.
27.3. Binding Effect. Subject to the prohibitions against assignment set forth in section 8 above, this Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns.
27.4. Governing Law. This Agreement shall be construed and interpreted in accordance with and shall be governed and enforced in all respects according to the laws of the State of California, without regard to conflict of laws principles.
27.5. Time of the Essence. Time is of the essence of each and every provision of this Agreement.
27.6. Integration. This Agreement contains the entire understanding between the parties relating to the transaction contemplated by this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged in this Agreement and shall be of no further force or effect.
27.7. Notices. All written notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by overnight courier service, or (iv) delivered by facsimile, provided that the original of such facsimile notice is sent by certified U.S. mail, postage prepaid, no later than one business day following such facsimile. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery pursuant to the methods specified in clauses (i), (ii) or (iii) above if the intended recipient refuses to accept delivery). All such notices shall be delivered to the following addresses, or to such other address as the receiving party may from time to time specify by written notice to the other party:
To City: City of Brentwood
Attn: Housing Manager
150 City Park Way
Brentwood, CA 94513
Telephone No.:
Fax No.:

To Borrower:


Telephone No.:
Fax No.:

27.8. Severability. The illegality or unenforceability of any provision of this Agreement or any instrument or agreement required hereunder shall not in any way affect or impair the legality or enforceability of the remaining provisions of this Agreement or any instrument or agreement required hereunder.
27.9. No Waiver. A waiver by any party of a breach of any of the covenants, conditions or agreements under this Agreement to be performed by another party shall not be construed as a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or conditions of this Agreement.
27.10. Rights Cumulative. All rights and remedies existing under this Agreement are cumulative to, and not exclusive of, any other rights or remedies available under contract or applicable law.
27.11. Modifications and Amendments. This Agreement may be amended only in writing signed by the parties.
27.12. Cooperation. Each party agrees to cooperate with the other in this transaction and, in that regard, shall execute any and all documents which may be reasonably necessary, helpful, or appropriate to carry out the purposes and intent of this Agreement including, but not limited to, releases or additional agreements.
27.13. 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 of any of its terms. Reference to section numbers are to sections in this Agreement, unless expressly stated otherwise.
27.14. Computation of Time. The time in which any act is to be done under this Agreement is computed by excluding the first day (such as the day escrow opens), 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 Sections 6700 and 6701 of the California Government Code. If any act is to be done by a particular time during a day, that time shall be Pacific Time Zone time.
27.15. Incorporation of Recitals and Exhibits. All recitals and exhibits attached hereto are incorporated into this Agreement by reference as if set forth fully herein.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

BORROWER




By:

Name:

By:

Name:
CITY

City of Brentwood, a municipal corporation

By:

Name:
Donna Landeros, City Manager

Attest:

By:
Cindy Garcia, Interim City Clerk

Approved as to Form:


By:
Tom Curry, Interim City Attorney




ATTACHMENT 1

Legal Description of the Property

[To be inserted]


ATTACHMENT 2

PROMISSORY NOTE
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
DOWNPAYMENT ASSISTANCE PROGRAM (DAP)

Not to Exceed , 20__
$ Brentwood, California
NOTICE TO BORROWER: THE LOAN EVIDENCED BY THIS NOTE IS SECURED BY A DEED OF TRUST THAT PROVIDES FOR AN INTEREST RATE OF 3, 5 OR 7 PERCENT DEPENDENT UPON YOUR LENGTH OF OWNERSHIP AND A LUMP SUM PAYMENT OF PRINCIPAL AND INTEREST AT MATURITY.

FOR VALUE RECEIVED, ("Borrower"), having an address of , promises to pay the CITY OF BRENTWOOD ("City"), having an address of 150 City Park Way, Brentwood, CA 94513, the principal sum of DOLLARS ($ ), pursuant to the terms and conditions set forth below.
1. Loan. This Promissory Note (the "Note") is made pursuant to Section 2.1 of that certain Loan Agreement (the "Agreement") between Borrower and City, dated , 20__. This is a promissory note for the repayment to City of the Dollar ($ ) loan provided by City to Borrower (the "Loan") in order to enable Borrower to purchase that certain real property described in Attachment 1 of the Agreement (the "Property"). Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement.
2. Disbursement. The Loan shall be disbursed in accordance with and subject to the Conditions Precedent to Loan Disbursement set forth in Section 3 of the Agreement.
3. Deed of Trust. Payment of this Note is secured by a deed of trust, security agreement and fixture filing (the "Deed of Trust") executed by Borrower to , as Trustee, for the benefit of City, which Deed of Trust shall be recorded against the Property.
4. Repayment. So long as Borrower is not in default under this Note or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal and interest of the Loan shall be due and payable in full on the earlier of: (a) the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part; or (b) on [insert maturity date of first loan] (the "Maturity Date").
5. Interest. Interest on the Loan shall accrue as follows:
5.1 Term of Less than Three Years. If the Maturity Date is less than three years after the date of execution of this Note, the Loan shall bear simple interest at a rate of seven percent per annum from the date of disbursement.

5.2 Term of Three to Ten Years. If the Maturity Date is between three and ten years after the date of execution of this Note, the Loan shall bear simple interest at a rate of five percent per annum from the date of disbursement.

5.3 Term of More than Ten Years. If the Maturity Date is more than ten years after the date of execution of this Note, the Loan shall bear simple interest at a rate of three percent per annum from the date of disbursement.

6. Place of Payment. Payment shall be made in lawful money of the United States to City, City of Brentwood at the following address: 150 City Park Way, Brentwood, California 94513. The place of payment may be changed from time to time as the City may designate in writing.

7. Non-Negotiability; Transfer. This Note is non-negotiable and not transferable by Borrower. Borrower, at its option, may negotiate transfer or assumption of this Note.
8. Prepayment. Borrower shall have the right to prepay, at any time and from time to time, all or any portion of the amounts owing under this Note without any premium or penalty.
9. Event of Default. The occurrence of any of the following shall constitute an event of default under this Note: (a) Borrower fails to pay any amount due hereunder within ten calendar days of its due date; or (b) any default by Borrower under the Deed of Trust, the Agreement or any other loan or other document affecting the Property, including, but not limited to, refinancing the Loan in violation of the terms of the Agreement, subject to any applicable cure periods provided therein.
10. Payment Upon Default. At the option of City and without notice, the entire unpaid principal and interest owing on this Note shall become immediately due and payable (a) upon the occurrence of any event of default, or (b) upon the sale, transfer, assignment, conveyance or lease of the Property, in whole or in part, prior to repayment of the principal and interest owing on this Note. This option may be exercised at any time following any such event, and the acceptance of one or more installments thereafter shall not constitute a waiver of City's option. City's failure to exercise such option shall not constitute a waiver of such option with respect to any subsequent event. City's failure in the exercise of any other right or remedy hereunder or under any agreement which secures the indebtedness or is related thereto shall not affect any right or remedy and no single or partial exercise of any such right or remedy shall preclude any further exercise thereof.
11. Interest Upon Default. At all times when Borrower is in default hereunder by reason of Borrower's failure to pay principal or interest due under this Note or any amounts due under any loan documents securing this Note, the interest rate on the sums as to which Borrower is in default, shall be the lower of the highest rate then allowed by law or five percent over the prime interest rate announced by Bank of America N.T.&S.A., as of the date of the default. If Bank of America N.T.&S.A. no longer exists or fails to announce a prime interest rate, the prime interest rate announced by the largest bank, in terms of total assets, of the member banks of the Eleventh District Federal Reserve Bank that announce a prime interest rate, shall be applicable for purposes of this section.
12. Waiver of Presentment. Borrower and any endorsers hereof and all others who may become liable for all or any part of this obligation, severally waive presentment for payment, demand and protest and notice of protest, and of dishonor and nonpayment of this Note, and expressly consent to any extension of the time of payment hereof or of any installment hereof, to the release of any party liable for this obligation, and any such extension or release may be made without notice to any of said parties and without any way affecting or discharging this liability.
13. Attorney Fees. Borrower agrees to pay immediately upon demand all costs and expenses of City including reasonable attorneys' fees, (a) if after an event of default this Note is placed in the hands of an attorney or attorneys for collection, (b) if after an event of default hereunder, City finds it necessary or desirable to secure the services or advice of one or more attorneys with regard to collection of this Note against Borrower, any guarantor or any other party liable therefore or to the protection of its rights under this Note, the Deed of Trust, the Agreement, or other loan document, or (c) if City seeks to have the Property abandoned by or reclaimed from any estate in bankruptcy, or attempts to have any stay or injunction prohibiting the enforcement or collection of the Note or prohibiting the enforcement of the Deed of Trust or any other agreement evidencing or securing this Note lifted by any bankruptcy or other court. If City shall be made a party to or shall reasonably intervene in any action or proceeding, whether in court or before any governmental Agency, affecting the Property or the title thereto or the interest of the City under the Deed of Trust, including, without limitation, any form of condemnation or eminent domain proceeding, City shall be reimbursed by Borrower immediately upon demand for all costs, charges and attorneys' fees incurred by City in any such case, and the same shall be secured by the Deed of Trust as a further charge and lien upon the Property.
14. Notices. All notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, or (iii) delivered by overnight courier service. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery if the intended recipient refuses to accept delivery). All such notices shall be delivered to the addresses set forth above, or to such other address as the receiving party may from time to time specify by written notice to the other party.
15. Successors and Assigns. This Note shall be binding upon Borrower, its successors and assigns.
16. Governing Law. This Note shall be construed in accordance with and be governed by the laws of the State of California, without regard to conflict of laws principles.
17. Severability. If any provision of this Note is declared invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.
18. Construction with Agreement. In the event of any inconsistency between this Note and the Agreement, the terms of this Note shall prevail.
19. Joint and Several Liability. All covenants and agreements of Borrower shall be joint and several obligations.
BORROWER




By:

Name:

By:

Name:
ATTACHMENT 3
PROMISSORY NOTE
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
INDIVIDUAL DEVELOPMENT ACCOUNTS (IDA)

Not to Exceed , 20__
$ Brentwood, California
NOTICE TO BORROWER: THE LOAN EVIDENCED BY THIS NOTE IS SECURED BY A DEED OF TRUST THAT PROVIDES FOR A VARIABLE INTEREST RATE DEPENDENT UPON YOUR LENGTH OF OWNERSHIP.

FOR VALUE RECEIVED, , ("Borrower"), having an address of , promises to pay the CITY OF BRENTWOOD ("City"), having an address of 150 City Park Way, Brentwood, CA 94513, the principal sum of DOLLARS ($ ), pursuant to the terms and conditions set forth below.
1. Loan. This Promissory Note (the "Note") is made pursuant to Section 3.1 of that certain Loan Agreement (the "Agreement") between Borrower and City, dated , 20__. This is a promissory note for the repayment to City of the Dollar ($ ) loan provided by City to Borrower (the "Loan") in order to enable Borrower to purchase that certain real property described in Attachment 1 of the Agreement (the "Property"). Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement.
2. Disbursement. The Loan shall be disbursed in accordance with and subject to the Conditions Precedent to Disbursement of Loans set forth in Section 4 of the Agreement.
3. Deed of Trust. Payment of this Note is secured by a deed of trust, security agreement and fixture filing (the "Deed of Trust") executed by Borrower to , as Trustee, for the benefit of City, which Deed of Trust shall be recorded against the Property.
4. Repayment. So long as Borrower is not in default under this Note or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal of the Loan shall be due and payable in full on the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part (the "Maturity Date"), unless forgiven as described below. However, in the event that the Maturity Date is five years after execution of this Note, all or part of the Loan will be forgiven as follows:
4.1 If the Maturity Date is between five and six years after the date of execution of this Note, 50 percent of the Loan will be forgiven.

4.2 If the Maturity Date is between six and seven years after the date of execution of this Note, 60 percent of the Loan will be forgiven.

4.3 If the Maturity Date is between seven and eight years after the date of execution of this Note, 70 percent of the Loan will be forgiven.

4.4 If the Maturity Date is between eight and nine years after the date of execution of this Note, 80 percent of the Loan will be forgiven.

4.5 If the Maturity Date is between nine and ten years after the date of execution of this Note, 90 percent of the Loan will be forgiven.

4.6 If the Maturity Date is over ten years after the date of execution of this Note, the entirety of the Loan will be forgiven.

5. Interest. No interest shall accrue on the Loan.

6. Place of Payment. Payment shall be made in lawful money of the United States to City, City of Brentwood at the following address: 150 City Park Way, Brentwood, California 94513. The place of payment may be changed from time to time as the City may designate in writing.

7. Non-Negotiability; Transfer. This Note is non-negotiable and not transferable by Borrower. Borrower, at its option, may negotiate transfer or assumption of this Note.
8. Prepayment. Borrower shall have the right to prepay, at any time and from time to time, all or any portion of the amounts owing under this Note without any premium or penalty.
9. Event of Default. The occurrence of any of the following shall constitute an event of default under this Note: (a) Borrower fails to pay any amount due hereunder within ten calendar days of its due date; or (b) any default by Borrower under the Deed of Trust, the Agreement or any other loan or other document affecting the Property, subject to any applicable cure periods provided therein.
10. Payment Upon Default. At the option of City and without notice, the entire unpaid principal and interest owing on this Note shall become immediately due and payable (a) upon the occurrence of any event of default, or (b) upon the sale, transfer, assignment, conveyance or lease of the Property, in whole or in part, prior to repayment of the principal and interest owing on this Note. This option may be exercised at any time following any such event, and the acceptance of one or more installments thereafter shall not constitute a waiver of City's option. City's failure to exercise such option shall not constitute a waiver of such option with respect to any subsequent event. City's failure in the exercise of any other right or remedy hereunder or under any agreement which secures the indebtedness or is related thereto shall not affect any right or remedy and no single or partial exercise of any such right or remedy shall preclude any further exercise thereof.
11. Interest Upon Default. At all times when Borrower is in default hereunder by reason of Borrower's failure to pay principal or interest due under this Note or any amounts due under any loan documents securing this Note, the interest rate on the sums as to which Borrower is in default, shall be the lower of the highest rate then allowed by law or five percent over the prime interest rate announced by Bank of America N.T.&S.A., as of the date of the default. If Bank of America N.T.&S.A. no longer exists or fails to announce a prime interest rate, the prime interest rate announced by the largest bank, in terms of total assets, of the member banks of the Eleventh District Federal Reserve Bank that announce a prime interest rate, shall be applicable for purposes of this section.
12. Waiver of Presentment. Borrower and any endorsers hereof and all others who may become liable for all or any part of this obligation, severally waive presentment for payment, demand and protest and notice of protest, and of dishonor and nonpayment of this Note, and expressly consent to any extension of the time of payment hereof or of any installment hereof, to the release of any party liable for this obligation, and any such extension or release may be made without notice to any of said parties and without any way affecting or discharging this liability.
13. Attorney Fees. Borrower agrees to pay immediately upon demand all costs and expenses of City including reasonable attorneys' fees, (a) if after an event of default this Note is placed in the hands of an attorney or attorneys for collection, (b) if after an event of default hereunder, City finds it necessary or desirable to secure the services or advice of one or more attorneys with regard to collection of this Note against Borrower, any guarantor or any other party liable therefor or to the protection of its rights under this Note, the Deed of Trust, the Agreement, or other loan document, or (c) if City seeks to have the Property abandoned by or reclaimed from any estate in bankruptcy, or attempts to have any stay or injunction prohibiting the enforcement or collection of the Note or prohibiting the enforcement of the Deed of Trust or any other agreement evidencing or securing this Note lifted by any bankruptcy or other court. If City shall be made a party to or shall reasonably intervene in any action or proceeding, whether in court or before any governmental Agency, affecting the Property or the title thereto or the interest of the City under the Deed of Trust, including, without limitation, any form of condemnation or eminent domain proceeding, City shall be reimbursed by Borrower immediately upon demand for all costs, charges and attorneys' fees incurred by City in any such case, and the same shall be secured by the Deed of Trust as a further charge and lien upon the Property.
14. Notices. All notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, or (iii) delivered by overnight courier service. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery if the intended recipient refuses to accept delivery). All such notices shall be delivered to the addresses set forth above, or to such other address as the receiving party may from time to time specify by written notice to the other party.
15. Successors and Assigns. This Note shall be binding upon Borrower, its successors and assigns.
16. Governing Law. This Note shall be construed in accordance with and be governed by the laws of the State of California, without regard to conflict of laws principles.
17. Severability. If any provision of this Note is declared invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.
18. Construction with Agreement. In the event of any inconsistency between this Note and the Agreement, the terms of this Note shall prevail.
19. Joint and Several Liability. All covenants and agreements of Borrower shall be joint and several obligations.
BORROWER




By:

Name:

By:

Name:
ATTACHMENT 4

Deed of Trust


RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City of Brentwood
150 City Park Way
Brentwood, California 94513
Attn: Housing Manager ))))))))
)
This document is exempt from the payment of a recording fee pursuant to Government Code § 6103.

DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
DOWNPAYMENT ASSISTANCE PROGRAM (DAP)
INDIVIDUAL DEVELOPMENT ACCOUNTS (IDA)

NOTICE TO BORROWER: THE LOANS SECURED BY THIS DEED OF TRUST PROVIDES FOR A VARIABLE INTEREST RATE DEPENDENT UPON YOUR LENGTH OF OWNERSHIP AND/OR A LUMP SUM PAYMENT OF PRINCIPAL AND INTEREST AT MATURITY.

This Deed of Trust, Security Agreement and Fixture Filing is made as of , among , ("Borrower"), whose address is , , a ("Trustee"), whose address is , and the City of Brentwood, a California municipal corporation ("City"), whose address is 150 City Park Way, Brentwood, California 94513.

Borrower irrevocably grants, conveys, transfers and assigns to Trustee in trust, with power of sale and right of entry and possession, all of Borrower's estate, right, title and interest in, to and under the following property (collectively, "Property"): (a) the real property in Contra Costa County, California, described on Exhibit A attached hereto and incorporated herein by this reference, together with all existing and future easements and rights affording access to it ("Land"), (b) together with all buildings, structures and improvements now existing or hereafter constructed thereon ("Improvements"), (c) together with all articles of personal property now or hereafter attached to, placed upon for an indefinite term, or used in connection with the Land and/or Improvements, together with all goods and other property that are, or at any time become, so related to the Property that an interest in them arises under real estate law, or they are otherwise adjudged to be a "fixture" under applicable law (each a "Fixture," collectively "Fixtures"), (d) together with all other property and interests of any kind or character which may be reasonably necessary or desirable to promote the present and future beneficial use and enjoyment of such real property and improvements.

1. Secured Obligations. Borrower makes the grant, conveyance, transfer and assignment herein for the purpose of securing the following obligations ("Secured Obligations"): (a) payment of the sum of DOLLARS ($ ) together with interest on the unpaid principal balance according to the terms of a Downpayment Assistance Program promissory note ("DAP Note") of even date herewith and the Loan Agreement ("Loan Agreement") dated _______________, by and between Borrower and City and any amendment, modification, extension, rearrangement, restatement, replacement, substitution or renewals thereof; (b) payment of the sum of DOLLARS ($ ) according to the terms of an Individual Development Account promissory note ("IDA Note") of even date herewith and the Loan Agreement; (c) payment of such further sums as the then record owner of the Property may borrow from City, when evidenced by a promissory note or notes reciting that they are secured by this Deed of Trust; and (d) performance of each agreement of Borrower incorporated by reference or contained herein or in the DAP Note, the IDA Note or the Loan Agreement. The DAP Note and IDA Note may hereinafter be collectively referred to as the Notes.

2. Maintenance and Repair. Borrower shall (a) keep the Property in good condition and repair and not remove or demolish any building; (b) complete or restore promptly and in good and workmanlike manner any building which may be constructed, damaged or destroyed; (c) pay when due all claims for labor performed and materials furnished; (d) comply with all laws affecting the Property or requiring any alterations or improvements to be made; (e) not commit or permit waste; (f) cultivate, irrigate, fertilize, fumigate, prune and do all other acts which from the character or use of the Property may be reasonably necessary; and (g) not cause or permit any Hazardous Materials (as hereinafter defined) to be brought upon, kept or used in or about the Property by Borrower, its agents, employees, contractors or invitees. If Borrower breaches the obligations stated in this Section 2, then Borrower shall indemnify, defend (with counsel approved by City) and hold City harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in value of the Property, and sums paid in settlement of claims, attorneys' fees, consultant fees and expert fees) which arise during or after the term of this Deed of Trust as a result of such breach, contamination, discharge, or release. This indemnification of City by Borrower includes, without limitation, costs incurred in connection with any investigation of site conditions or any cleanup, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of Hazardous Materials present in, on or under the Property or adjacent property caused by, or as a result of, Borrower's activities. This indemnification specifically excludes Hazardous Materials brought on the Property by prior occupants. For the purpose of this Section 2, the term "Hazardous Materials" includes, without limitation, any flammable explosives, radioactive materials, hazardous materials, hazardous wastes, hazardous or toxic substances, or related materials defined in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. §9601 et seq.), the Hazardous Materials Transportation Act, as amended (49 U.S.C. §1801 et seq.), the Resource Conservation and Recovery Act of 1976, as amended (42 U.S.C. §6901 et seq.), Section 25117 of the California Health & Safety Code, Section 25316 of the California Health & Safety Code, and in the regulations adopted and publications promulgated pursuant to them, or any other federal, state, or local environmental laws, ordinances, rules, or regulations concerning the environment, industrial hygiene or public health or safety now in effect or enacted after this date.

3. Insurance. Borrower shall maintain hazard insurance against loss by fire, hazards included with the term "extended coverage," and any other hazards for which City requires insurance, and liability insurance. The insurance carrier and the insurance policies and amounts of coverage shall be acceptable to City, the policies shall name City as a loss payee or an additional insured, as applicable, the policies shall include City as an additional insured, as applicable, and shall require 30 calendar days' prior notice to City before the policy is modified or terminated.

4. Defense of Security. Borrower shall appear in and defend any action or proceeding purporting to affect the security or the rights or powers of City or Trustee. Borrower shall pay all costs and expenses, including costs of evidence of title and attorneys' fees, in any such action or proceeding in which Trustee or City may appear, and in any suit brought by City to foreclose this Deed of Trust.

5. Payment of Taxes and Liens. Borrower shall pay (a) at least 10 calendar days before delinquency, all taxes and assessments affecting the Property, including water stock assessments; (b) when due, all encumbrances, charges and liens, with interest, on the Property; and (c) upon demand all costs, fees and expenses of this Deed of Trust. If Borrower fails to make any payment or to do any act provided for in this Deed of Trust, then City or Trustee may, without obligation to do so, and with or without notice to or demand upon Borrower, and without releasing Borrower from any obligation under this Deed of Trust: (w) make or do the same in such manner and to such extent as either may deem necessary to protect the security, City or Trustee being authorized to enter upon the Property for such purposes; (x) appear in or commence any action or proceeding purporting to affect the security, or the rights or powers of City or Trustee; (y) pay, purchase, contest or settle any encumbrance, charge or lien which in the judgment of either appears to be senior to this Deed of Trust; and (z) in exercising any such powers, pay allowable expenses, including attorneys' fees.

6. Reimbursement of Costs. Borrower shall pay upon demand all sums expended by City or Trustee provided for in this Deed of Trust or allowed by law, with interest from date of expenditure at the maximum rate provided in the Notes.

7. Borrower Not Released; Forbearance by City Not a Waiver. By accepting payment of any sum after its due date, City does not waive its right either to require prompt payment when due of all other sums or declare a default for failure to pay. Extension of the time for payment, acceptance of a renewal note or notes, release of any person from liability, modification of the payment terms and conditions, or modification or amortization of the sums secured by this Deed of Trust granted by City to any successor in interest of Borrower shall not operate to release, in any manner, the liability of the original Borrower and Borrower's successors in interest. City shall not be required to commence proceedings against such successor or refuse to extend time for payment, accept a renewal note or notes, release any person from liability, otherwise modify the payment terms and conditions, or modify amortization of the sums secured by this Deed of Trust by reason of any demand made by the original Borrower and Borrower's successors in interest. Any forbearance by City in exercising any right or remedy hereunder, or otherwise afforded by applicable law, shall not be a waiver of or preclude the exercise of any such right or remedy.

8. Reconveyance. That upon written request of City stating that all sums secured hereby have been paid, and upon surrender of this Deed of Trust and the Notes 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 grantee in such reconveyance may be described as "the person or persons legally entitled thereto."

9. Occupancy of Property; No Rental. Borrower shall occupy, establish and maintain the use of the Property as Borrower's principal residence throughout the term of the Notes securing this Deed of Trust. There shall be no rental of the Property.

10. Default and Foreclosure. Upon default by Borrower in payment or performance of any Secured Obligation, subject to any applicable cure period, City may declare all sums secured immediately due and payable by delivery to Trustee of a declaration of default and demand for sale and of a notice of default and of a notice of sale, which notice Trustee shall cause to be filed for record. City also shall deposit with Trustee this Deed of Trust, said Notes and all documents evidencing expenditures secured by this Deed of Trust. Upon default of any obligation secured by this Deed of Trust and acceleration of all sums due, City may instruct Trustee to proceed with a sale of the Property under the power of sale granted in this Deed of Trust, noticed and held in accordance with California Civil Code Sections 2924, et seq., as such statutes may be amended from time to time. Borrower waives all rights it may have to require marshaling of assets or to require sales of assets in any particular order, including any rights under California Civil Code Sections 2899 and 3455.

11. Substitution of Trustee. City, or any successor in ownership of any Secured Obligations, may from time to time, by instrument in writing, substitute a successor or successors to any Trustee named herein or acting hereunder, which instrument executed by the City and duly acknowledged and recorded in the Contra Costa County Recorder's Office, 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 Borrower, Trustee and City hereunder, the book and page where this Deed of Trust is recorded and the name and address of the new Trustee.

12. Successors and Assigns. This Deed of Trust applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns. The term "City" shall mean the owner and holder, including pledgees, of the Notes, whether or not named as City herein.

13. Trustee Acceptance. Trustee accepts this trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. Trustee is not obligated to notify any party hereto of pending sale under any other deed of trust or of any action or proceeding in which Borrower, City or Trustee shall be a party unless brought by Trustee.

14. Further Assurances. Borrower shall, at its own cost and expense, do, execute, acknowledge, and deliver all and every such further acts, deeds, conveyances, mortgages, assignments, notices of assignments, transfers, and assurances as Trustee or City shall from time to time require, for better assuring, conveying, assigning, transferring, and confirming unto Trustee the Property and rights hereby conveyed or assigned or intended now or hereafter so to be, or which Borrower may be or may hereafter become bound to convey or assign to Trustee, or for carrying out the intention or facilitating the performance of the terms of this Deed of Trust, or for filing, registering, or recording this Deed of Trust. Borrower shall, on demand, execute and deliver, and hereby authorizes Trustee and City, or either of them, to execute in the name of Borrower, to the extent it may lawfully do so, one or more financing statements, chattel mortgages, or comparable security instruments, to evidence more effectively the lien hereof. Immediately upon the execution and delivery of this Deed of Trust, and thereafter from time to time, Borrower shall cause this Deed of Trust, and any security instruments creating a lien or evidencing the lien hereof upon any property and each instrument of further assurance, to be filed, registered, or recorded in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to protect the lien hereof upon, and the title of Trustee to, the Property encumbered hereby.

15. Condemnation and Insurance Proceeds. Immediately upon obtaining knowledge of the institution of any proceedings for the condemnation or other taking of all or any portion of the Property, or knowledge of any casualty damage to the Property, or damage in any other manner, Borrower shall immediately notify City thereof. Borrower hereby authorizes and empowers City as attorney in fact for Borrower to make proof of loss, to adjust and compromise any claim under the insurance policies covering the Property, to appear in and prosecute any action arising from such insurance policies, to collect and receive insurance proceeds, and to deduct therefrom City's expenses incurred in the collection of such proceeds; provided, however, that nothing contained in this Section shall require City to incur any expense or take any action hereunder. Borrower hereby authorizes and empowers City, at City's option, as attorney-in-fact for Borrower, to commence, appear in and prosecute, in City's or Borrower's name, any action or proceeding relating to any condemnation or other taking of all or any part of the Property, whether direct or indirect, and to settle or compromise any claim in connection with such condemnation or other taking. The proceeds of any award payment or claim for damages, direct or consequential, in connection with any condemnation or other taking, whether direct or indirect, of the Property, or any part thereof, or for conveyances in lieu of the Property, or any part thereof, shall be paid to City. The foregoing powers of attorney are coupled with an interest and are irrevocable. Borrower hereby authorizes City to apply such awards, payments, proceeds or damages relating to condemnation of the Property and insurance covering the Property, after the deduction of City's expenses incurred in the collection of such amounts, subject to the requirements of applicable law and the provisions hereof, to restoration or repair of the Property or to payment of the sums secured by this Deed of Trust. City shall be under no obligation to question the amount of any compensation, awards, proceeds, damages, claims, rights of action, and payments relating to condemnation or other taking of the Property or insured casualty affecting the Property, and may accept the same in the amount in which the same shall be paid. Borrower shall execute such further evidence of assignment of any awards, proceeds damages or claims arising in connection with such condemnation or taking or such insurance as City may require. Notwithstanding the above, the City shall release all insurance and condemnation proceeds to Borrower to be used to reconstruct the improvements on the Property provided that City determines that such restoration, repair or rebuilding is economically feasible. If such insurance proceeds shall be insufficient for such purposes, Borrower shall make up the deficiency. If the Property is subject to a partial condemnation or taking, then the proceeds received therefrom shall be applied to restore the Property taken, provided the City determines that such restoration is economically feasible and no default exists under the Loan Agreement, the Notes, this Deed of Trust, and all other instruments or agreements required to be executed by Borrower or any guarantor in connection with the Loan (collectively, "Loan Documents") following the expiration of all applicable cure periods. If the Property is subject to a total condemnation, or if City determines that restoration of the Property is not feasible following a partial condemnation, or if a default exists then the proceeds from any condemnation award or claim for damages shall be used first to repay all sums under the Notes, with the excess, if any, paid to Borrower.

16. Estoppel Certificate. Borrower shall, within ten (10) calendar days of a written request from City, furnish City with a written statement, duly acknowledged, setting forth the sums secured by this Deed of Trust and any right of set-off, counterclaim or other defense which exists against such sums and the obligations of this Deed of Trust.

17. California Uniform Commercial Code Security Agreement; Fixture Filing. Borrower hereby grants City a security interest in all fixtures of Borrower now owned or hereafter in existence, acquired or created on, of or relating to the Property, and all substitutions, replacements, additions, accessions and proceeds (including insurance proceeds) of all of the foregoing (collectively, "Secured Property"). City may file this Deed of Trust, or a reproduction hereof, in the real estate records or other appropriate index, as a financing statement for the Secured Property. Any reproduction of this Deed of Trust or of any other security agreement or financing statement shall be sufficient as a financing statement. In addition, Borrower shall execute and deliver to City, upon City's request, any financing statements, as well as extensions, renewals and amendments thereof, and reproductions of this Deed of Trust in such form as City may require to perfect a security interest with respect to the Secured Property. Borrower shall pay all costs of filing such financing statements and any extensions, renewals, amendments and releases thereof, and shall pay all reasonable costs and expenses of any record searches for financing statements City may reasonably require. Without the prior written consent of City, Borrower shall not create or suffer to be created pursuant to the California Uniform Commercial Code any other security interest in the Secured Property. Upon Borrower's breach of any covenant or agreement of Borrower contained in this Deed of Trust, including the covenants to pay when due all sums secured by this Deed of Trust, City shall have the remedies of a secured party under the California Uniform Commercial Code and, at City's option, may also invoke any remedies provided in this Deed of Trust as to the Secured Property. In exercising any of such remedies, City may proceed against the Property and any of the Secured Property separately or together and in any order whatsoever, without in any way affecting the availability of City's remedies under the California Uniform Commercial Code or the remedies provided in the Deed of Trust. This Deed of Trust also covers goods which are or which are to become fixtures on the Property and constitutes and is filed as a fixture filing under the California Uniform Commercial Code.

18. Due-On-Sale or Encumbrance. If all or any part of the Property, or any interest therein, or any beneficial interest in Borrower (if Borrower is not a natural person or persons but is a corporation, partnership, trust, limited liability company or other legal entity), is sold, transferred, mortgaged, assigned, pledged, or further encumbered, whether directly or indirectly, whether voluntarily or involuntarily or by operational law, City may, at City's option, declare all of the sums secured by this Deed of Trust to be immediately due and payable, and City may invoke any remedies permitted by this Deed of Trust.

19. Subordination. City and Borrower acknowledge and agree that this Deed of Trust is subject and subordinate in all respects to the liens, terms, covenants and conditions of the senior deed of trust in favor of in the amount of DOLLARS ($ ) existing as of the date hereof (“Senior Deed of Trust"), and to those advances heretofore made or which may hereafter be made pursuant to the Senior Deed of Trust for the purpose of protecting or further securing the lien of the Senior Deed of Trust, or curing defaults by the Borrower under the Senior Deed of Trust. Borrower may refinance the loan secured by the Senior Deed of Trust only in accordance with Section 3.3 of the Loan Agreement. Notwithstanding anything to the contrary in the Notes, the Loan Agreement, or this Deed of Trust, the status of this Deed of Trust as a lien and security interest on the Property shall be second only to the Senior Deed of Trust.

20. No Discrimination. Borrower covenants that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, sexual preference, age, marital status, physical handicap, medical condition, disability, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, nor shall the Borrower itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the Property.

21. Authorization; Joint and Several. Each individual or entity executing this Deed of Trust on behalf of Borrower represents and warrants that he or she or it is duly authorized to execute and deliver this Deed of Trust on behalf of Borrower and that such execution is binding upon Borrower. If Borrower consists of more than one person, the obligation of all such persons shall be joint and several, with each person who signs this Deed of Trust being fully and personally obligated to keep all of the promises made in this Deed of Trust, including the promise to pay the full amount owed. City, in City's sole discretion, may enforce its rights under this Deed of Trust against any person individually or against all Borrowers together.

22. Waiver of Statute of Limitations. The pleading of any statute of limitations as a defense to the obligations evidenced by this Deed of Trust is waived to the fullest extent permissible by law.

23. Notices. All notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, or (iii) delivered by overnight courier service. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery if the intended recipient refuses to accept delivery). All such notices shall be delivered to the addresses set forth above, or to such other address as the receiving party may from time to time specify by written notice to the other parties.

24. Remedies. In the event of default under the Loan Documents, City may exercise any right or remedy which it has under any or all of the Loan Document(s), or which is otherwise available at law or in equity or by statute, and all of City's rights and remedies shall be cumulative.

25. Modifications. Any waiver, change, modification or discharge of this Deed of Trust may be made only by the prior written consent of City and Borrower. No alteration, amendment or waiver of any provision of this Deed of Trust, or any other agreement or instrument evidencing or providing security for this Deed of Trust, made by agreement of City, the holder hereof or any other person or party, shall constitute a waiver of any other term hereof, or otherwise release or discharge the liability of Borrower under this Deed of Trust.

26. Severability; Construction; Governing Law. If any provision of this Deed of Trust or the application of any such provision shall be held by a court of competent jurisdiction to be invalid, void or unenforceable to any extent, the remaining provisions of this Deed of Trust and the application thereof shall remain in full force and effect and shall not be affected, impaired or invalidated. This Deed of Trust shall be construed and enforced in accordance with the laws of the State of California without reference to its choice of laws principles. Section headings have been inserted solely as a matter of convenience and are not intended to define or limit the scope of any of the provisions contained therein.

27. Integration. The Notes, this Deed of Trust, and the Loan Agreement embody the agreement between City and Borrower for the Loans and its terms and conditions. If any term of this Deed of Trust is inconsistent with any term of the Notes or the Loan Agreement, the terms of the Notes shall govern.

The undersigned Borrower requests that a copy of any Notice of Default and of any Notice of Sale hereunder be mailed to Borrower at Borrower's address hereinbefore set forth.

BORROWER




By:

Name:

By:

Name:



EXHIBIT A

The real property referred to herein is situated in the City of Brentwood, Contra Costa County, California, and is commonly known as , and more particularly described as follows:

[To be inserted]


STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On , 200 , before me, , the undersigned, personally appeared ,
( ) personally known to me
( ) 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.
WITNESS my hand and official seal:
Signature:


STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On , 200 , before me, , the undersigned, personally appeared ,
( ) personally known to me
( ) 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.
WITNESS my hand and official seal:
Signature:



LOAN AGREEMENT
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
GAP ASSISTANCE FOR THE AFFORDABLE HOUSING PROGRAM (GAP)
INDIVIDUAL DEVELOPMENT ACCOUNTS (IDA)

This Loan Agreement ("Agreement") is entered into as of , 20 , by and between the City of Brentwood, a municipal corporation ("City") and , ("Borrower").
RECITALS

A. City has established a First Time Homebuyer Assistance Program ("Program") for the benefit of first time homebuyers purchasing homes within the City of Brentwood and earning up to 120 percent of the Area Median Income (as calculated by the State of California, Department of Housing and Community Development).
B. B. Borrower is purchasing the real property commonly known and described as [insert address], Brentwood, California, and more particularly described in Attachment 1, attached hereto (the "Property"), through the City's Affordable Housing Program. A residence that will be the principal residence of Borrower is located on the Property (the "Residence"). In connection with this purchase, Borrower and City are entering into a Resale and Refinance Limitation Agreement and Option to Purchase ("Resale Restriction Agreement"), which will restrict the sale of the Property to -income households for a period of 45 years.
C. Borrower has applied for a Gap Assistance for the Affordable Housing Program loan to assist in Borrower's purchase of the Property.
D. Borrower has also applied for an Individual Development Account loan and has saved approximately toward the cost of homeownership.
E. The parties wish to enter into this Agreement to define the rights and obligations of City and Borrower with respect to the Loans (as defined below).
NOW, THEREFORE, City and Borrower agree as follows:
AGREEMENT
28. Definitions.
"Agreement" means this Loan Agreement between Borrower and City.
"Borrower" means .
"City" means the City of Brentwood, a municipal corporation.
"Conditions Precedent to Disbursement of Loans" is defined in Section 4.
"GAP Loan" is defined in Section 2.1.
"GAP Maturity Date" is defined in Section 2.1(a).
"GAP Note" is defined in Section 3.1 below.
"GAP Term" is defined in Section 2.1(a).
"Deed of Trust" is defined in Section 3.2 below.
"Escrow Holder" means [insert name of escrow company], the escrow holder handling the purchase of the Property by Borrower.
"Event of Default" is defined in Section 7.1 below.
"First Loan" is defined in Section 3.3 below.
"IDA Loan" is defined in Section 2.2.
"IDA Maturity Date" is defined in Section 2.2(a).
"IDA Note" is defined in Section 3.1 below.
"IDA Term" is defined in Section 2.2(a).
"Lender's Policy of Title Insurance" is defined in Section 4.3.
"Loans" means the GAP Loan and the IDA Loan.
"Loan Documents" are the GAP Note, the IDA Note and the Deed of Trust.
"Permitted Exceptions" is defined in Section 3.2 below.
"Program" is defined in Recital A.
"Property" is defined in Recital B.
"Ownership Interest" means and includes fee simple, joint tenancy, tenancy in common, life estate, shareholder in a cooperative or interest held in trust for Borrower that would continue on ownership if held by the Borrower.
"Resale Restriction Agreement" is defined in Recital B.
"Residence" is defined in Recital B.
"Senior Deed of Trust" is defined in Section 3.2 below.

29. Loans.
29.1. GAP Loan. Subject to the terms and conditions set forth herein, City agrees to loan Borrower a principal amount not to exceed $ (the "GAP Loan") to enable Borrower to purchase the Property.
(a) Term of GAP Loan; Commencement and Maturity Date. The term (the "GAP Term") of the GAP Loan shall commence on the date of execution of the GAP Note and shall end on the earlier of: (a) the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part; or (b) on [insert maturity date of first loan] (the "GAP Maturity Date").
(b) Repayment of the GAP Loan. So long as Borrower is not in default under this Agreement or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal and interest of the GAP Loan shall be due and payable in full on the GAP Maturity Date. The GAP Loan may be prepaid at any time without penalty.
(c) Interest. The GAP Loan shall bear simple interest at a rate of three percent per annum from the date of disbursement.
29.2. IDA Loan. Subject to the terms and conditions set forth herein, City agrees to loan Borrower a principal amount not to exceed $ (the "IDA Loan") to enable Borrower to purchase the Property.
(a) Term of IDA Loan; Commencement and Maturity Date. The term (the "IDA Term") of the IDA Loan shall commence on the date of execution of the IDA Note and shall end on the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part (the "IDA Maturity Date"). If the IDA Term is more than ten years, the IDA Loan shall be fully forgiven and no payments shall be due thereunder.
(b) Repayment of the IDA Loan. So long as Borrower is not in default under this Agreement or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal of the IDA Loan shall be due and payable in full on the IDA Maturity Date. However, in the event that the IDA Term is five years or longer, all or part of the IDA Loan will be forgiven as follows:
(1) If the IDA Term is between five and six years, 50 percent of the IDA Loan will be forgiven.
(2) If the IDA Term is between six and seven years, 60 percent of the IDA Loan will be forgiven.
(3) If the IDA Term is between seven and eight years, 70 percent of the IDA Loan will be forgiven.
(4) If the IDA Term is between eight and nine years, 80 percent of the IDA Loan will be forgiven.
(5) If the IDA Term is between nine and ten years, 90 percent of the IDA Loan will be forgiven.
(6) If the IDA Term is over ten years, the entirety of the IDA Loan will be forgiven.
(c) Interest. The IDA Loan shall bear no interest.
29.3. Use of Proceeds; Disbursement to Escrow Holder. Proceeds of the Loans shall be used only for the purchase of the Property and payment of closing and escrow costs required to be paid by Borrower pursuant to section 4.6 below. Upon satisfaction or waiver by City of all of the Conditions Precedent to Disbursement of the Loans set forth in section 4 below, City shall deliver the proceeds of the Loans to the Escrow Holder, to be applied directly to the purchase of the Property. In no event shall the proceeds of the Loans be disbursed to Borrower.
30. Notes, Security Documents and Refinancing.
30.1. Promissory Notes. As evidence of Borrower's obligation to repay the GAP Loan, Borrower shall execute and deliver to the Escrow Holder, a promissory note in favor of City in the form attached hereto as Attachment 2 (the "GAP Note"). As evidence of Borrower's obligation to repay the IDA Loan, Borrower shall execute and deliver to the Escrow Holder, a promissory note in favor of City in the form attached hereto as Attachment 3 (the "IDA Note").
30.2. Deed of Trust Encumbering Property. As security for Borrower's performance of its obligations hereunder, Borrower shall execute and deliver to the Escrow Holder, a recordable Deed of Trust in favor of City in the form attached hereto as Attachment 4 (the "Deed of Trust"). The Deed of Trust shall be subject and subordinate only to (a) the deed(s) of trust made by Borrower to [insert name of primary lenders], the first lender(s) (the "Senior Deed of Trust"); (b) the Resale Restriction Agreement; (c) the lien for current real property taxes not yet due and payable; and (d) existing easements over the Property for public utilities and other purposes (the "Permitted Exceptions").
30.3. Refinancing. Borrower shall not refinance the loan secured by the Senior Deed of Trust (the "First Loan"), except as allowed under the Resale Restriction Agreement and Program requirements, which allow refinancing if all of the following requirements are met: (a) refinancing without the prior written approval of City, City shall approve refinancing if it is solely to achieve a lower interest rate; (b) refinancing does not cause the monthly housing cost after refinancing to be greater than an Affordable Housing Cost, as defined in Health & Safety Code Section 50052.5; and (c) the amount being refinanced is not greater than 90 percent of the original purchase price. Borrower must receive written approval of City prior to refinancing the First Loan in order to ensure that these Program requirements are met. However, City shall not approve any refinancing that results in any release of funds to Borrower, typically referred to as a "cash-out" loan, unless Borrower agrees to repay the Loan, plus accrued interest, with the proceeds.
31. Conditions Precedent to Disbursement of the Loans. City's obligation to disburse the Loans is conditioned upon the satisfaction or waiver by City of each and all of the conditions precedent described below (the "Conditions Precedent to Disbursement of the Loans"), which are solely for the benefit of City.
31.1. No Default. Subject to the expiration of any applicable cure period, Borrower shall not be in default of any of its obligations under the terms of this Agreement and all representations and warranties of Borrower contained herein shall be true and correct.
31.2. Execution of Loan Documents and Resale Restriction Agreement. Borrower shall have executed the Notes and shall have executed and acknowledged the Deed of Trust and Resale Restriction Agreement in recordable format.
31.3. Lender's Policy of Title Insurance. Escrow Holder shall be unconditionally and irrevocably committed to issuing a CLTA Lender's policy of title insurance to City insuring City in the principal amount of the Loans and the validity and priority of the Deed of Trust as a lien upon the Property, subject only to the Permitted Exceptions, and showing fee simple title to the Property in the name of Borrower ("Lender's Policy of Title Insurance").
31.4. Prepared to Close Escrow. Borrower shall have executed and acknowledged, where necessary, all documents and shall be in a position to close escrow on the Property.
31.5. Recordation of Documents. The Deed of Trust shall have been recorded against the Property in the Contra Costa County Recorder's Office.
31.6. Payment of Escrow Fees and Costs. Borrower shall have paid all escrow fees and closing costs for the purchase of the Property and the premium for the Lender's Policy of Title Insurance, which may be paid for out of the proceeds of the Loans.
32. Representations and Warranties. Borrower represents and warrants that the matters addressed in subsections 5.1 through 5.9 below are true and correct.
32.1. No Conflicts. The execution, delivery, and performance of this Agreement and of any instrument or agreement required by this Agreement are not in conflict with any law or any indenture, agreement, or undertaking to which Borrower is a party or by which Borrower is bound or affected.
32.2. Enforceability. This Agreement is a legal, valid and binding agreement of Borrower, enforceable against Borrower in accordance with its terms, and any instrument or agreement required under this Agreement, when executed and delivered, will be similarly legal, valid, binding and enforceable.
32.3. No Event of Default. No event has occurred and is continuing or would result from the extension of credit under this Agreement which constitutes or would constitute an Event of Default or which, upon a lapse of time or notice or both, would become an Event of Default.
32.4. Other Obligations. Borrower is not in default under any other agreement involving the borrowing of money, the extension of credit, or the lease of real or personal property to which Borrower is a party as borrower, guarantor, installment purchaser or lessee.
32.5. No Other Liens. Other than the Senior Deed of Trust and Resale Restriction Agreement, Borrower is not encumbering the Property with any other lien, deed of trust or security interest.
32.6. First Time Homebuyer. Borrower has not had any Ownership Interest in the State of California in his, her or their primary residence in the three years preceding the date of application to participate in the Program, except for an Ownership Interest in a primary residence that was terminated or extinguished due to divorce or marital dissolution.
32.7. Application Information. All of the information provided by Borrower in the Program loan applications, including, without limitation, income criteria, is true and accurate.
32.8. Attended Class. Borrower has attended a First Time Homebuyer Education Class offered by City or City's designee.
32.9. IDA Savings. Borrower saved the amount of from to [insert dates during which Borrower saved funds] toward the purchase of the Property.
32.10. Affordable Housing Program. Borrower has completed all of City's requirements for participation in the City's Affordable Housing Program.
33. Covenants. Borrower promises to keep each of the covenants set forth below, unless City has waived compliance in writing.
33.1. Compliance with Laws. Borrower shall at all times comply with, or cause to be complied with, all federal, state and local laws, statutes, rules, regulations, ordinances, orders and directions affecting the Property.
33.2. Occupy as Principal Residence. Borrower shall occupy the Residence as Borrower's principal residence and shall reside in the Residence on a full-time basis.
33.3. Taxes and Other Liabilities. Borrower shall pay all taxes and other governmental or regulatory assessments assessed and levied against the Property at least ten calendar days prior to delinquency and shall timely file all required tax returns.
33.4. Liens and Other Indebtedness. Other than the Senior Deed of Trust and Resale Restriction Agreement, Borrower shall not encumber the Property with any other lien, deed of trust or security interest without the prior written approval of City.
33.5. Refinancing. Borrower shall comply with the refinancing provisions set forth in Section 3.3 above.
33.6. No Lease. Borrower shall not assign or lease the whole or any part of the Property.
33.7. Attend Classes. Borrower shall attend any follow-up First Time Homebuyer Education Classes offered by City or City's designee.
34. Default and Remedies.
34.1. Events of Default. The occurrence of any of the following events, and the continuation thereof beyond the corresponding cure period (if any) set forth below, shall constitute an "Event of Default" under this Agreement:
(a) Borrower fails to make any payment as and when due under the Loan Documents, where such failure continues beyond ten (10) calendar days after written notice from City specifying the general nature and the amount of the overdue payment.
(b) Borrower fails to comply with any provision contained in this Agreement or the Loan Documents, other than provisions governing repayment of the Loans, or the Resale Restriction Agreement and does not cure that failure within 30 calendar days after written notice from City.
(c) Any representation or warranty of Borrower set forth in this Agreement, the Loan Documents or the Resale Restriction Agreement, or any information delivered by Borrower to City pursuant to this Agreement, proves to be false or misleading in any material respect.
(d) Under any of the Loan Documents or the Resale Restriction Agreement, an event of default or default (as defined in that document) occurs.
34.2. Remedies. If an Event of Default occurs under this Agreement, any of the Loan Documents or the Resale Restriction Agreement, City may exercise any right or remedy which it has under any of the documents, or which is otherwise available at law, in equity or by statute, and all of City's rights and remedies shall be cumulative. Upon the occurrence of any Event of Default, all of Borrower's obligations under the Loan Documents may become immediately due and payable without notice of default, presentment or demand for payment, protest or notice of nonpayment or dishonor, or other notices or demands of any kind or character, all at City's option, exercisable in its sole discretion.
34.3. Interest Upon Event of Default. At all times when Borrower is in default by reason of Borrower's failure to pay principal or interest due under this Agreement, the interest rate on the sums to which Borrower is in default, shall be the lower of the highest rate then allowed by law or five percent over the prime interest rate announced by Bank of America N.T.&S.A., as of the date of the Event of Default. If Bank of America N.T.&S.A. no longer exists or fails to announce a prime interest rate, the prime interest rate announced by the largest bank, in terms of total assets, of the member banks of the Eleventh District Federal Reserve Bank that announce a prime interest rate, shall be applicable for purposes of this section 7.3.
35. No Assignment. The qualifications and identity of Borrower are of particular concern to City. It is because of those unique qualifications and identity that City has entered into this Agreement with Borrower. No voluntary or involuntary successor in interest of Borrower shall acquire any of Borrower's rights or powers under this Agreement.
36. Miscellaneous.
36.1. Joint and Several Liability. All covenants and agreements of Borrower shall be the joint and several obligations of all signatories, makers, sureties, guarantors and endorsers and shall be binding upon them.
36.2. Further Assurances. The parties shall execute, acknowledge, file or record such other instruments and statements and shall take such additional action as may be necessary to carry out the purpose and intent of this Agreement.
36.3. Binding Effect. Subject to the prohibitions against assignment set forth in section 8 above, this Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns.
36.4. Governing Law. This Agreement shall be construed and interpreted in accordance with and shall be governed and enforced in all respects according to the laws of the State of California, without regard to conflict of laws principles.
36.5. Time of the Essence. Time is of the essence of each and every provision of this Agreement.
36.6. Integration. This Agreement contains the entire understanding between the parties relating to the transaction contemplated by this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged in this Agreement and shall be of no further force or effect.
36.7. Notices. All written notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by overnight courier service, or (iv) delivered by facsimile, provided that the original of such facsimile notice is sent by certified U.S. mail, postage prepaid, no later than one business day following such facsimile. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery pursuant to the methods specified in clauses (i), (ii) or (iii) above if the intended recipient refuses to accept delivery). All such notices shall be delivered to the following addresses, or to such other address as the receiving party may from time to time specify by written notice to the other party:
To City: City of Brentwood
Attn: Housing Manager
150 City Park Way
Brentwood, CA 94513
Telephone No.:
Fax No.:

To Borrower:


Telephone No.:
Fax No.:

36.8. Severability. The illegality or unenforceability of any provision of this Agreement or any instrument or agreement required hereunder shall not in any way affect or impair the legality or enforceability of the remaining provisions of this Agreement or any instrument or agreement required hereunder.
36.9. No Waiver. A waiver by any party of a breach of any of the covenants, conditions or agreements under this Agreement to be performed by another party shall not be construed as a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or conditions of this Agreement.
36.10. Rights Cumulative. All rights and remedies existing under this Agreement are cumulative to, and not exclusive of, any other rights or remedies available under contract or applicable law.
36.11. Modifications and Amendments. This Agreement may be amended only in writing signed by the parties.
36.12. Cooperation. Each party agrees to cooperate with the other in this transaction and, in that regard, shall execute any and all documents which may be reasonably necessary, helpful, or appropriate to carry out the purposes and intent of this Agreement including, but not limited to, releases or additional agreements.
36.13. 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 of any of its terms. Reference to section numbers are to sections in this Agreement, unless expressly stated otherwise.
36.14. Computation of Time. The time in which any act is to be done under this Agreement is computed by excluding the first day (such as the day escrow opens), 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 Sections 6700 and 6701 of the California Government Code. If any act is to be done by a particular time during a day, that time shall be Pacific Time Zone time.
36.15. Incorporation of Recitals and Exhibits. All recitals and exhibits attached hereto are incorporated into this Agreement by reference as if set forth fully herein.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

BORROWER




By:

Name:

By:

Name:
CITY

City of Brentwood, a municipal corporation

By:

Name:
Donna Landeros, City Manager

Attest:

By:
Cindy Garcia, Interim City Clerk

Approved as to Form:


By:
Tom Curry, Interim City Attorney




ATTACHMENT 1

Legal Description of the Property

[To be inserted]


ATTACHMENT 2

PROMISSORY NOTE
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
GAP ASSISTANCE FOR THE AFFORDABLE HOUSING PROGRAM (GAP)

Not to Exceed , 20__
$ Brentwood, California
NOTICE TO BORROWER: THE LOAN EVIDENCED BY THIS NOTE IS SECURED BY A DEED OF TRUST THAT PROVIDES FOR A LUMP SUM PAYMENT OF PRINCIPAL AND INTEREST AT MATURITY.

FOR VALUE RECEIVED, ("Borrower"), having an address of promises to pay the CITY OF BRENTWOOD ("City"), having an address of 150 City Park Way, Brentwood, CA 94513, the principal sum of DOLLARS ($ ), pursuant to the terms and conditions set forth below.
1. Loan. This Promissory Note (the "Note") is made pursuant to Section 2.1 of that certain Loan Agreement (the "Agreement") between Borrower and City, dated , 20__. This is a promissory note for the repayment to City of the Dollar ($ ) loan provided by City to Borrower (the "Loan") in order to enable Borrower to purchase that certain real property described in Attachment 1 of the Agreement (the "Property"). Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement.
2. Disbursement. The Loan shall be disbursed in accordance with and subject to the Conditions Precedent to Loan Disbursement set forth in Section 3 of the Agreement.
3. Deed of Trust. Payment of this Note is secured by a deed of trust, security agreement and fixture filing (the "Deed of Trust") executed by Borrower to , as Trustee, for the benefit of City, which Deed of Trust shall be recorded against the Property.
4. Repayment. So long as Borrower is not in default under this Note or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal and interest of the Loan shall be due and payable in full on the earlier of: (a) the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part; or (b) on [insert maturity date of first loan] (the "Maturity Date").
5. Interest. The Loan shall bear simple interest at a rate of three percent per annum from the date of disbursement.

6. Place of Payment. Payment shall be made in lawful money of the United States to City, City of Brentwood at the following address: 150 City Park Way, Brentwood, California 94513. The place of payment may be changed from time to time as the City may designate in writing.

7. Non-Negotiability; Transfer. This Note is non-negotiable and not transferable by Borrower. Borrower, at its option, may negotiate transfer or assumption of this Note.
8. Prepayment. Borrower shall have the right to prepay, at any time and from time to time, all or any portion of the amounts owing under this Note without any premium or penalty.
9. Event of Default. The occurrence of any of the following shall constitute an event of default under this Note: (a) Borrower fails to pay any amount due hereunder within ten calendar days of its due date; or (b) any default by Borrower under the Deed of Trust, the Agreement, the Resale Restriction Agreement or any other loan or other document affecting the Property, including, but not limited to, refinancing the Loan in violation of the terms of the Agreement, subject to any applicable cure periods provided therein.
10. Payment Upon Default. At the option of City and without notice, the entire unpaid principal and interest owing on this Note shall become immediately due and payable (a) upon the occurrence of any event of default, or (b) upon the sale, transfer, assignment, conveyance or lease of the Property, in whole or in part, prior to repayment of the principal and interest owing on this Note. This option may be exercised at any time following any such event, and the acceptance of one or more installments thereafter shall not constitute a waiver of City's option. City's failure to exercise such option shall not constitute a waiver of such option with respect to any subsequent event. City's failure in the exercise of any other right or remedy hereunder or under any agreement which secures the indebtedness or is related thereto shall not affect any right or remedy and no single or partial exercise of any such right or remedy shall preclude any further exercise thereof.
11. Interest Upon Default. At all times when Borrower is in default hereunder by reason of Borrower's failure to pay principal or interest due under this Note or any amounts due under any loan documents securing this Note, the interest rate on the sums as to which Borrower is in default, shall be the lower of the highest rate then allowed by law or five percent over the prime interest rate announced by Bank of America N.T.&S.A., as of the date of the default. If Bank of America N.T.&S.A. no longer exists or fails to announce a prime interest rate, the prime interest rate announced by the largest bank, in terms of total assets, of the member banks of the Eleventh District Federal Reserve Bank that announce a prime interest rate, shall be applicable for purposes of this section.
12. Waiver of Presentment. Borrower and any endorsers hereof and all others who may become liable for all or any part of this obligation, severally waive presentment for payment, demand and protest and notice of protest, and of dishonor and nonpayment of this Note, and expressly consent to any extension of the time of payment hereof or of any installment hereof, to the release of any party liable for this obligation, and any such extension or release may be made without notice to any of said parties and without any way affecting or discharging this liability.
13. Attorney Fees. Borrower agrees to pay immediately upon demand all costs and expenses of City including reasonable attorneys' fees, (a) if after an event of default this Note is placed in the hands of an attorney or attorneys for collection, (b) if after an event of default hereunder, City finds it necessary or desirable to secure the services or advice of one or more attorneys with regard to collection of this Note against Borrower, any guarantor or any other party liable therefor or to the protection of its rights under this Note, the Deed of Trust, the Agreement, or other loan document, or (c) if City seeks to have the Property abandoned by or reclaimed from any estate in bankruptcy, or attempts to have any stay or injunction prohibiting the enforcement or collection of the Note or prohibiting the enforcement of the Deed of Trust or any other agreement evidencing or securing this Note lifted by any bankruptcy or other court. If City shall be made a party to or shall reasonably intervene in any action or proceeding, whether in court or before any governmental Agency, affecting the Property or the title thereto or the interest of the City under the Deed of Trust, including, without limitation, any form of condemnation or eminent domain proceeding, City shall be reimbursed by Borrower immediately upon demand for all costs, charges and attorneys' fees incurred by City in any such case, and the same shall be secured by the Deed of Trust as a further charge and lien upon the Property.
14. Notices. All notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, or (iii) delivered by overnight courier service. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery if the intended recipient refuses to accept delivery). All such notices shall be delivered to the addresses set forth above, or to such other address as the receiving party may from time to time specify by written notice to the other party.
15. Successors and Assigns. This Note shall be binding upon Borrower, its successors and assigns.
16. Governing Law. This Note shall be construed in accordance with and be governed by the laws of the State of California, without regard to conflict of laws principles.
17. Severability. If any provision of this Note is declared invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.
18. Construction with Agreement. In the event of any inconsistency between this Note and the Agreement, the terms of this Note shall prevail.
19. Joint and Several Liability. All covenants and agreements of Borrower shall be joint and several obligations.
BORROWER



By:

Name:

By:

Name:
ATTACHMENT 3
PROMISSORY NOTE
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
INDIVIDUAL DEVELOPMENT ACCOUNTS (IDA)

Not to Exceed , 20__
$ Brentwood, California
NOTICE TO BORROWER: THE LOAN EVIDENCED BY THIS NOTE IS SECURED BY A DEED OF TRUST THAT PROVIDES FOR A VARIABLE INTEREST RATE DEPENDENT UPON YOUR LENGTH OF OWNERSHIP.

FOR VALUE RECEIVED, , ("Borrower"), having an address of , promises to pay the CITY OF BRENTWOOD ("City"), having an address of 150 City Park Way, Brentwood, CA 94513, the principal sum of DOLLARS ($ ), pursuant to the terms and conditions set forth below.
1. Loan. This Promissory Note (the "Note") is made pursuant to Section 3.1 of that certain Loan Agreement (the "Agreement") between Borrower and City, dated , 20__. This is a promissory note for the repayment to City of the Dollar ($ ) loan provided by City to Borrower (the "Loan") in order to enable Borrower to purchase that certain real property described in Attachment 1 of the Agreement (the "Property"). Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement.
2. Disbursement. The Loan shall be disbursed in accordance with and subject to the Conditions Precedent to Disbursement of Loans set forth in Section 4 of the Agreement.
3. Deed of Trust. Payment of this Note is secured by a deed of trust, security agreement and fixture filing (the "Deed of Trust") executed by Borrower to , as Trustee, for the benefit of City, which Deed of Trust shall be recorded against the Property.
4. Repayment. So long as Borrower is not in default under this Note or any of the Loan Documents, no payments shall be due hereunder, and the entire outstanding unpaid principal of the Loan shall be due and payable in full on the date Borrower sells, transfers, assigns or conveys, whether voluntarily or involuntarily, the Property, in whole or in part (the "Maturity Date"), unless forgiven as described below. However, in the event that the Maturity Date is five years after execution of this Note, all or part of the Loan will be forgiven as follows:
4.1 If the Maturity Date is between five and six years after the date of execution of this Note, 50 percent of the Loan will be forgiven.

4.2 If the Maturity Date is between six and seven years after the date of execution of this Note, 60 percent of the Loan will be forgiven.

4.3 If the Maturity Date is between seven and eight years after the date of execution of this Note, 70 percent of the Loan will be forgiven.

4.4 If the Maturity Date is between eight and nine years after the date of execution of this Note, 80 percent of the Loan will be forgiven.

4.5 If the Maturity Date is between nine and ten years after the date of execution of this Note, 90 percent of the Loan will be forgiven.

4.6 If the Maturity Date is over ten years after the date of execution of this Note, the entirety of the Loan will be forgiven.

5. Interest. No interest shall accrue on the Loan.

6. Place of Payment. Payment shall be made in lawful money of the United States to City, City of Brentwood at the following address: 150 City Park Way, Brentwood, California 94513. The place of payment may be changed from time to time as the City may designate in writing.

7. Non-Negotiability; Transfer. This Note is non-negotiable and not transferable by Borrower. Borrower, at its option, may negotiate transfer or assumption of this Note.
8. Prepayment. Borrower shall have the right to prepay, at any time and from time to time, all or any portion of the amounts owing under this Note without any premium or penalty.
9. Event of Default. The occurrence of any of the following shall constitute an event of default under this Note: (a) Borrower fails to pay any amount due hereunder within ten calendar days of its due date; or (b) any default by Borrower under the Deed of Trust, the Agreement or any other loan or other document affecting the Property, subject to any applicable cure periods provided therein.
10. Payment Upon Default. At the option of City and without notice, the entire unpaid principal and interest owing on this Note shall become immediately due and payable (a) upon the occurrence of any event of default, or (b) upon the sale, transfer, assignment, conveyance or lease of the Property, in whole or in part, prior to repayment of the principal and interest owing on this Note. This option may be exercised at any time following any such event, and the acceptance of one or more installments thereafter shall not constitute a waiver of City's option. City's failure to exercise such option shall not constitute a waiver of such option with respect to any subsequent event. City's failure in the exercise of any other right or remedy hereunder or under any agreement which secures the indebtedness or is related thereto shall not affect any right or remedy and no single or partial exercise of any such right or remedy shall preclude any further exercise thereof.
11. Interest Upon Default. At all times when Borrower is in default hereunder by reason of Borrower's failure to pay principal or interest due under this Note or any amounts due under any loan documents securing this Note, the interest rate on the sums as to which Borrower is in default, shall be the lower of the highest rate then allowed by law or five percent over the prime interest rate announced by Bank of America N.T.&S.A., as of the date of the default. If Bank of America N.T.&S.A. no longer exists or fails to announce a prime interest rate, the prime interest rate announced by the largest bank, in terms of total assets, of the member banks of the Eleventh District Federal Reserve Bank that announce a prime interest rate, shall be applicable for purposes of this section.
12. Waiver of Presentment. Borrower and any endorsers hereof and all others who may become liable for all or any part of this obligation, severally waive presentment for payment, demand and protest and notice of protest, and of dishonor and nonpayment of this Note, and expressly consent to any extension of the time of payment hereof or of any installment hereof, to the release of any party liable for this obligation, and any such extension or release may be made without notice to any of said parties and without any way affecting or discharging this liability.
13. Attorney Fees. Borrower agrees to pay immediately upon demand all costs and expenses of City including reasonable attorneys' fees, (a) if after an event of default this Note is placed in the hands of an attorney or attorneys for collection, (b) if after an event of default hereunder, City finds it necessary or desirable to secure the services or advice of one or more attorneys with regard to collection of this Note against Borrower, any guarantor or any other party liable therefor or to the protection of its rights under this Note, the Deed of Trust, the Agreement, or other loan document, or (c) if City seeks to have the Property abandoned by or reclaimed from any estate in bankruptcy, or attempts to have any stay or injunction prohibiting the enforcement or collection of the Note or prohibiting the enforcement of the Deed of Trust or any other agreement evidencing or securing this Note lifted by any bankruptcy or other court. If City shall be made a party to or shall reasonably intervene in any action or proceeding, whether in court or before any governmental Agency, affecting the Property or the title thereto or the interest of the City under the Deed of Trust, including, without limitation, any form of condemnation or eminent domain proceeding, City shall be reimbursed by Borrower immediately upon demand for all costs, charges and attorneys' fees incurred by City in any such case, and the same shall be secured by the Deed of Trust as a further charge and lien upon the Property.
14. Notices. All notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, or (iii) delivered by overnight courier service. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery if the intended recipient refuses to accept delivery). All such notices shall be delivered to the addresses set forth above, or to such other address as the receiving party may from time to time specify by written notice to the other party.
15. Successors and Assigns. This Note shall be binding upon Borrower, its successors and assigns.
16. Governing Law. This Note shall be construed in accordance with and be governed by the laws of the State of California, without regard to conflict of laws principles.
17. Severability. If any provision of this Note is declared invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.
18. Construction with Agreement. In the event of any inconsistency between this Note and the Agreement, the terms of this Note shall prevail.
19. Joint and Several Liability. All covenants and agreements of Borrower shall be joint and several obligations.
BORROWER




By:

Name:

By:

Name:
ATTACHMENT 4

Deed of Trust


RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City of Brentwood
150 City Park Way
Brentwood, California 94513
Attn: Housing Manager ))))))))
)
This document is exempt from the payment of a recording fee pursuant to Government Code § 6103.

DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING
CITY OF BRENTWOOD
FIRST TIME HOMEBUYER ASSISTANCE PROGRAM
GAP ASSISTANCE FOR THE AFFORDABLE HOUSING PROGRAM (GAP)
INDIVIDUAL DEVELOPMENT ACCOUNTS (IDA)

NOTICE TO BORROWER: THE LOANS SECURED BY THIS DEED OF TRUST PROVIDES FOR A VARIABLE INTEREST RATE DEPENDENT UPON YOUR LENGTH OF OWNERSHIP AND/OR A LUMP SUM PAYMENT OF PRINCIPAL AND INTEREST AT MATURITY.

This Deed of Trust, Security Agreement and Fixture Filing is made as of , among , ("Borrower"), whose address is , , a ("Trustee"), whose address is , and the City of Brentwood, a California municipal corporation ("City"), whose address is 150 City Park Way, Brentwood, California 94513.

Borrower irrevocably grants, conveys, transfers and assigns to Trustee in trust, with power of sale and right of entry and possession, all of Borrower's estate, right, title and interest in, to and under the following property (collectively, "Property"): (a) the real property in Contra Costa County, California, described on Exhibit A attached hereto and incorporated herein by this reference, together with all existing and future easements and rights affording access to it ("Land"), (b) together with all buildings, structures and improvements now existing or hereafter constructed thereon ("Improvements"), (c) together with all articles of personal property now or hereafter attached to, placed upon for an indefinite term, or used in connection with the Land and/or Improvements, together with all goods and other property that are, or at any time become, so related to the Property that an interest in them arises under real estate law, or they are otherwise adjudged to be a "fixture" under applicable law (each a "Fixture," collectively "Fixtures"), (d) together with all other property and interests of any kind or character which may be reasonably necessary or desirable to promote the present and future beneficial use and enjoyment of such real property and improvements.

1. Secured Obligations. Borrower makes the grant, conveyance, transfer and assignment herein for the purpose of securing the following obligations ("Secured Obligations"): (a) payment of the sum of DOLLARS ($ ) together with interest on the unpaid principal balance according to the terms of a Gap Assistance for the Affordable Housing Program promissory note ("GAP Note") of even date herewith and the Loan Agreement ("Loan Agreement") dated _______________, by and between Borrower and City and any amendment, modification, extension, rearrangement, restatement, replacement, substitution or renewals thereof; (b) payment of the sum of DOLLARS ($ ) according to the terms of an Individual Development Account promissory note ("IDA Note") of even date herewith and the Loan Agreement; (c) payment of such further sums as the then record owner of the Property may borrow from City, when evidenced by a promissory note or notes reciting that they are secured by this Deed of Trust; and (d) performance of each agreement of Borrower incorporated by reference or contained herein or in the GAP Note, the IDA Note or the Loan Agreement. The GAP Note and IDA Note may hereinafter be collectively referred to as the Notes.

2. Maintenance and Repair. Borrower shall (a) keep the Property in good condition and repair and not remove or demolish any building; (b) complete or restore promptly and in good and workmanlike manner any building which may be constructed, damaged or destroyed; (c) pay when due all claims for labor performed and materials furnished; (d) comply with all laws affecting the Property or requiring any alterations or improvements to be made; (e) not commit or permit waste; (f) cultivate, irrigate, fertilize, fumigate, prune and do all other acts which from the character or use of the Property may be reasonably necessary; and (g) not cause or permit any Hazardous Materials (as hereinafter defined) to be brought upon, kept or used in or about the Property by Borrower, its agents, employees, contractors or invitees. If Borrower breaches the obligations stated in this Section 2, then Borrower shall indemnify, defend (with counsel approved by City) and hold City harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in value of the Property, and sums paid in settlement of claims, attorneys' fees, consultant fees and expert fees) which arise during or after the term of this Deed of Trust as a result of such breach, contamination, discharge, or release. This indemnification of City by Borrower includes, without limitation, costs incurred in connection with any investigation of site conditions or any cleanup, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of Hazardous Materials present in, on or under the Property or adjacent property caused by, or as a result of, Borrower's activities. This indemnification specifically excludes Hazardous Materials brought on the Property by prior occupants. For the purpose of this Section 2, the term "Hazardous Materials" includes, without limitation, any flammable explosives, radioactive materials, hazardous materials, hazardous wastes, hazardous or toxic substances, or related materials defined in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. §9601 et seq.), the Hazardous Materials Transportation Act, as amended (49 U.S.C. §1801 et seq.), the Resource Conservation and Recovery Act of 1976, as amended (42 U.S.C. §6901 et seq.), Section 25117 of the California Health & Safety Code, Section 25316 of the California Health & Safety Code, and in the regulations adopted and publications promulgated pursuant to them, or any other federal, state, or local environmental laws, ordinances, rules, or regulations concerning the environment, industrial hygiene or public health or safety now in effect or enacted after this date.

3. Insurance. Borrower shall maintain hazard insurance against loss by fire, hazards included with the term "extended coverage," and any other hazards for which City requires insurance, and liability insurance. The insurance carrier and the insurance policies and amounts of coverage shall be acceptable to City, the policies shall name City as a loss payee or an additional insured, as applicable, the policies shall include City as an additional insured, as applicable, and shall require 30 calendar days' prior notice to City before the policy is modified or terminated.

4. Defense of Security. Borrower shall appear in and defend any action or proceeding purporting to affect the security or the rights or powers of City or Trustee. Borrower shall pay all costs and expenses, including costs of evidence of title and attorneys' fees, in any such action or proceeding in which Trustee or City may appear, and in any suit brought by City to foreclose this Deed of Trust.

5. Payment of Taxes and Liens. Borrower shall pay (a) at least 10 calendar days before delinquency, all taxes and assessments affecting the Property, including water stock assessments; (b) when due, all encumbrances, charges and liens, with interest, on the Property; and (c) upon demand all costs, fees and expenses of this Deed of Trust. If Borrower fails to make any payment or to do any act provided for in this Deed of Trust, then City or Trustee may, without obligation to do so, and with or without notice to or demand upon Borrower, and without releasing Borrower from any obligation under this Deed of Trust: (w) make or do the same in such manner and to such extent as either may deem necessary to protect the security, City or Trustee being authorized to enter upon the Property for such purposes; (x) appear in or commence any action or proceeding purporting to affect the security, or the rights or powers of City or Trustee; (y) pay, purchase, contest or settle any encumbrance, charge or lien which in the judgment of either appears to be senior to this Deed of Trust; and (z) in exercising any such powers, pay allowable expenses, including attorneys' fees.

6. Reimbursement of Costs. Borrower shall pay upon demand all sums expended by City or Trustee provided for in this Deed of Trust or allowed by law, with interest from date of expenditure at the maximum rate provided in the Notes.

7. Borrower Not Released; Forbearance by City Not a Waiver. By accepting payment of any sum after its due date, City does not waive its right either to require prompt payment when due of all other sums or declare a default for failure to pay. Extension of the time for payment, acceptance of a renewal note or notes, release of any person from liability, modification of the payment terms and conditions, or modification or amortization of the sums secured by this Deed of Trust granted by City to any successor in interest of Borrower shall not operate to release, in any manner, the liability of the original Borrower and Borrower's successors in interest. City shall not be required to commence proceedings against such successor or refuse to extend time for payment, accept a renewal note or notes, release any person from liability, otherwise modify the payment terms and conditions, or modify amortization of the sums secured by this Deed of Trust by reason of any demand made by the original Borrower and Borrower's successors in interest. Any forbearance by City in exercising any right or remedy hereunder, or otherwise afforded by applicable law, shall not be a waiver of or preclude the exercise of any such right or remedy.

8. Reconveyance. That upon written request of City stating that all sums secured hereby have been paid, and upon surrender of this Deed of Trust and the Notes 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 grantee in such reconveyance may be described as "the person or persons legally entitled thereto."

9. Occupancy of Property; No Rental. Borrower shall occupy, establish and maintain the use of the Property as Borrower's principal residence throughout the term of the Notes securing this Deed of Trust. There shall be no rental of the Property.

10. Default and Foreclosure. Upon default by Borrower in payment or performance of any Secured Obligation, subject to any applicable cure period, City may declare all sums secured immediately due and payable by delivery to Trustee of a declaration of default and demand for sale and of a notice of default and of a notice of sale, which notice Trustee shall cause to be filed for record. City also shall deposit with Trustee this Deed of Trust, said Notes and all documents evidencing expenditures secured by this Deed of Trust. Upon default of any obligation secured by this Deed of Trust and acceleration of all sums due, City may instruct Trustee to proceed with a sale of the Property under the power of sale granted in this Deed of Trust, noticed and held in accordance with California Civil Code Sections 2924, et seq., as such statutes may be amended from time to time. Borrower waives all rights it may have to require marshaling of assets or to require sales of assets in any particular order, including any rights under California Civil Code Sections 2899 and 3455.

11. Substitution of Trustee. City, or any successor in ownership of any Secured Obligations, may from time to time, by instrument in writing, substitute a successor or successors to any Trustee named herein or acting hereunder, which instrument executed by the City and duly acknowledged and recorded in the Contra Costa County Recorder's Office, 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 Borrower, Trustee and City hereunder, the book and page where this Deed of Trust is recorded and the name and address of the new Trustee.

12. Successors and Assigns. This Deed of Trust applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns. The term "City" shall mean the owner and holder, including pledgees, of the Notes, whether or not named as City herein.

13. Trustee Acceptance. Trustee accepts this trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. Trustee is not obligated to notify any party hereto of pending sale under any other deed of trust or of any action or proceeding in which Borrower, City or Trustee shall be a party unless brought by Trustee.

14. Further Assurances. Borrower shall, at its own cost and expense, do, execute, acknowledge, and deliver all and every such further acts, deeds, conveyances, mortgages, assignments, notices of assignments, transfers, and assurances as Trustee or City shall from time to time require, for better assuring, conveying, assigning, transferring, and confirming unto Trustee the Property and rights hereby conveyed or assigned or intended now or hereafter so to be, or which Borrower may be or may hereafter become bound to convey or assign to Trustee, or for carrying out the intention or facilitating the performance of the terms of this Deed of Trust, or for filing, registering, or recording this Deed of Trust. Borrower shall, on demand, execute and deliver, and hereby authorizes Trustee and City, or either of them, to execute in the name of Borrower, to the extent it may lawfully do so, one or more financing statements, chattel mortgages, or comparable security instruments, to evidence more effectively the lien hereof. Immediately upon the execution and delivery of this Deed of Trust, and thereafter from time to time, Borrower shall cause this Deed of Trust, and any security instruments creating a lien or evidencing the lien hereof upon any property and each instrument of further assurance, to be filed, registered, or recorded in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to protect the lien hereof upon, and the title of Trustee to, the Property encumbered hereby.

15. Condemnation and Insurance Proceeds. Immediately upon obtaining knowledge of the institution of any proceedings for the condemnation or other taking of all or any portion of the Property, or knowledge of any casualty damage to the Property, or damage in any other manner, Borrower shall immediately notify City thereof. Borrower hereby authorizes and empowers City as attorney in fact for Borrower to make proof of loss, to adjust and compromise any claim under the insurance policies covering the Property, to appear in and prosecute any action arising from such insurance policies, to collect and receive insurance proceeds, and to deduct therefrom City's expenses incurred in the collection of such proceeds; provided, however, that nothing contained in this Section shall require City to incur any expense or take any action hereunder. Borrower hereby authorizes and empowers City, at City's option, as attorney-in-fact for Borrower, to commence, appear in and prosecute, in City's or Borrower's name, any action or proceeding relating to any condemnation or other taking of all or any part of the Property, whether direct or indirect, and to settle or compromise any claim in connection with such condemnation or other taking. The proceeds of any award payment or claim for damages, direct or consequential, in connection with any condemnation or other taking, whether direct or indirect, of the Property, or any part thereof, or for conveyances in lieu of the Property, or any part thereof, shall be paid to City. The foregoing powers of attorney are coupled with an interest and are irrevocable. Borrower hereby authorizes City to apply such awards, payments, proceeds or damages relating to condemnation of the Property and insurance covering the Property, after the deduction of City's expenses incurred in the collection of such amounts, subject to the requirements of applicable law and the provisions hereof, to restoration or repair of the Property or to payment of the sums secured by this Deed of Trust. City shall be under no obligation to question the amount of any compensation, awards, proceeds, damages, claims, rights of action, and payments relating to condemnation or other taking of the Property or insured casualty affecting the Property, and may accept the same in the amount in which the same shall be paid. Borrower shall execute such further evidence of assignment of any awards, proceeds damages or claims arising in connection with such condemnation or taking or such insurance as City may require. Notwithstanding the above, the City shall release all insurance and condemnation proceeds to Borrower to be used to reconstruct the improvements on the Property provided that City determines that such restoration, repair or rebuilding is economically feasible. If such insurance proceeds shall be insufficient for such purposes, Borrower shall make up the deficiency. If the Property is subject to a partial condemnation or taking, then the proceeds received therefrom shall be applied to restore the Property taken, provided the City determines that such restoration is economically feasible and no default exists under the Loan Agreement, the Notes, this Deed of Trust, and all other instruments or agreements required to be executed by Borrower or any guarantor in connection with the Loan (collectively, "Loan Documents") following the expiration of all applicable cure periods. If the Property is subject to a total condemnation, or if City determines that restoration of the Property is not feasible following a partial condemnation, or if a default exists then the proceeds from any condemnation award or claim for damages shall be used first to repay all sums under the Notes, with the excess, if any, paid to Borrower.

16. Estoppel Certificate. Borrower shall, within ten (10) calendar days of a written request from City, furnish City with a written statement, duly acknowledged, setting forth the sums secured by this Deed of Trust and any right of set-off, counterclaim or other defense which exists against such sums and the obligations of this Deed of Trust.

17. California Uniform Commercial Code Security Agreement; Fixture Filing. Borrower hereby grants City a security interest in all fixtures of Borrower now owned or hereafter in existence, acquired or created on, of or relating to the Property, and all substitutions, replacements, additions, accessions and proceeds (including insurance proceeds) of all of the foregoing (collectively, "Secured Property"). City may file this Deed of Trust, or a reproduction hereof, in the real estate records or other appropriate index, as a financing statement for the Secured Property. Any reproduction of this Deed of Trust or of any other security agreement or financing statement shall be sufficient as a financing statement. In addition, Borrower shall execute and deliver to City, upon City's request, any financing statements, as well as extensions, renewals and amendments thereof, and reproductions of this Deed of Trust in such form as City may require to perfect a security interest with respect to the Secured Property. Borrower shall pay all costs of filing such financing statements and any extensions, renewals, amendments and releases thereof, and shall pay all reasonable costs and expenses of any record searches for financing statements City may reasonably require. Without the prior written consent of City, Borrower shall not create or suffer to be created pursuant to the California Uniform Commercial Code any other security interest in the Secured Property. Upon Borrower's breach of any covenant or agreement of Borrower contained in this Deed of Trust, including the covenants to pay when due all sums secured by this Deed of Trust, City shall have the remedies of a secured party under the California Uniform Commercial Code and, at City's option, may also invoke any remedies provided in this Deed of Trust as to the Secured Property. In exercising any of such remedies, City may proceed against the Property and any of the Secured Property separately or together and in any order whatsoever, without in any way affecting the availability of City's remedies under the California Uniform Commercial Code or the remedies provided in the Deed of Trust. This Deed of Trust also covers goods which are or which are to become fixtures on the Property and constitutes and is filed as a fixture filing under the California Uniform Commercial Code.

18. Due-On-Sale or Encumbrance. If all or any part of the Property, or any interest therein, or any beneficial interest in Borrower (if Borrower is not a natural person or persons but is a corporation, partnership, trust, limited liability company or other legal entity), is sold, transferred, mortgaged, assigned, pledged, or further encumbered, whether directly or indirectly, whether voluntarily or involuntarily or by operational law, City may, at City's option, declare all of the sums secured by this Deed of Trust to be immediately due and payable, and City may invoke any remedies permitted by this Deed of Trust.

19. Subordination. City and Borrower acknowledge and agree that this Deed of Trust is subject and subordinate in all respects to the liens, terms, covenants and conditions of the senior deed of trust in favor of in the amount of DOLLARS ($ ) existing as of the date hereof (“Senior Deed of Trust"), and to those advances heretofore made or which may hereafter be made pursuant to the Senior Deed of Trust for the purpose of protecting or further securing the lien of the Senior Deed of Trust, or curing defaults by the Borrower under the Senior Deed of Trust. Borrower may refinance the loan secured by the Senior Deed of Trust only in accordance with Section 3.3 of the Loan Agreement. Notwithstanding anything to the contrary in the Notes, the Loan Agreement, or this Deed of Trust, the status of this Deed of Trust as a lien and security interest on the Property shall be second only to the Senior Deed of Trust.

20. No Discrimination. Borrower covenants that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, sexual preference, age, marital status, physical handicap, medical condition, disability, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, nor shall the Borrower itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the Property.

21. Authorization; Joint and Several. Each individual or entity executing this Deed of Trust on behalf of Borrower represents and warrants that he or she or it is duly authorized to execute and deliver this Deed of Trust on behalf of Borrower and that such execution is binding upon Borrower. If Borrower consists of more than one person, the obligation of all such persons shall be joint and several, with each person who signs this Deed of Trust being fully and personally obligated to keep all of the promises made in this Deed of Trust, including the promise to pay the full amount owed. City, in City's sole discretion, may enforce its rights under this Deed of Trust against any person individually or against all Borrowers together.

22. Waiver of Statute of Limitations. The pleading of any statute of limitations as a defense to the obligations evidenced by this Deed of Trust is waived to the fullest extent permissible by law.

23. Notices. All notices required to be given pursuant to the terms hereof shall be either (i) personally delivered, (ii) deposited in the United States express mail or first class mail, registered or certified, return receipt requested, postage prepaid, or (iii) delivered by overnight courier service. All such notices shall be deemed delivered upon actual receipt (or upon the first attempt at delivery if the intended recipient refuses to accept delivery). All such notices shall be delivered to the addresses set forth above, or to such other address as the receiving party may from time to time specify by written notice to the other parties.

24. Remedies. In the event of default under the Loan Documents, City may exercise any right or remedy which it has under any or all of the Loan Document(s), or which is otherwise available at law or in equity or by statute, and all of City's rights and remedies shall be cumulative.

25. Modifications. Any waiver, change, modification or discharge of this Deed of Trust may be made only by the prior written consent of City and Borrower. No alteration, amendment or waiver of any provision of this Deed of Trust, or any other agreement or instrument evidencing or providing security for this Deed of Trust, made by agreement of City, the holder hereof or any other person or party, shall constitute a waiver of any other term hereof, or otherwise release or discharge the liability of Borrower under this Deed of Trust.

26. Severability; Construction; Governing Law. If any provision of this Deed of Trust or the application of any such provision shall be held by a court of competent jurisdiction to be invalid, void or unenforceable to any extent, the remaining provisions of this Deed of Trust and the application thereof shall remain in full force and effect and shall not be affected, impaired or invalidated. This Deed of Trust shall be construed and enforced in accordance with the laws of the State of California without reference to its choice of laws principles. Section headings have been inserted solely as a matter of convenience and are not intended to define or limit the scope of any of the provisions contained therein.

27. Integration. The Notes, this Deed of Trust, and the Loan Agreement embody the agreement between City and Borrower for the Loans and its terms and conditions. If any term of this Deed of Trust is inconsistent with any term of the Notes or the Loan Agreement, the terms of the Notes shall govern.

The undersigned Borrower requests that a copy of any Notice of Default and of any Notice of Sale hereunder be mailed to Borrower at Borrower's address hereinbefore set forth.

BORROWER




By:

Name:

By:

Name:



EXHIBIT A

The real property referred to herein is situated in the City of Brentwood, Contra Costa County, California, and is commonly known as , and more particularly described as follows:

[To be inserted]


STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On , 200 , before me, , the undersigned, personally appeared ,
( ) personally known to me
( ) 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.
WITNESS my hand and official seal:
Signature:


STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On , 200 , before me, , the undersigned, personally appeared ,
( ) personally known to me
( ) 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.
WITNESS my hand and official seal:
Signature:

 

City Administration
City of Brentwood City Council
150 City Park Way
Brentwood, CA 94513
(925) 516-5440
Fax (925) 516-5441
E-mail allcouncil@brentwoodca.gov