INTERCREDITOR AND LOAN ADMINISTRATION AGREEMENT Prepared by:
Housing Department
City of Clearwater
112 South Osceola Ave.
Clearwater,FL 33756
CITY OF CLEARWATER,FLORIDA
PINELLAS COUNTY,FLORIDA
INTERCREDITOR AND LOAN ADMINISTRATION AGREEMENT
THIS INTERCREDITOR AND LOAN ADMINISTRATION AGREEMENT (this
"Agreement'), made as of November 9, 2012, by and between the CITY OF CLEARWATER, ("CITY"),
a municipal corporation organized and existing under the laws of the State of Florida, with offices at 112
S. Osceola, Clearwater, Florida, 33756 and PINELLAS COUNTY, ("COUNTY"), a political subdivision
of the State of Florida, by and through the PINELLAS COUNTY BOARD OF COUNTY
COMMISSIONERS, with offices at 600 Cleveland Street, Suite 800, Clearwater, Florida 33755-4159;
and consented and agreed to by SP COUNTRY CLUB HOMES, LLC, a Florida for-profit corporation
with its principal offices at 2430 Estancia Boulevard, Suite 101, Clearwater, Florida 33761
(`BORROWER").
Background
A. Pursuant to a loan agreement between CITY and Borrower, dated June 16, 2008,
modified on December 1, 2009 and subordinated on December 23, 2011 ("CDBG Loan Agreement'),
CITY has made available to Borrower a $700,000 Community Development Block Grant (CDBG)
acquisition loan ("CITY CDBG Loan"), as evidenced by a promissory note dated June 16, 2008
executed by Borrower in favor of CITY ("CITY CDBG Note"), the proceeds of which will be used by
Borrower to pay the costs of acquiring certain real property located in the Clearwater, Florida, owned or
to be owned by Borrower, and as more fully described in Exhibit A, collectively, the "Property" to
develop affordable single-family attached homes in the Country Club Townhomes Development
("Project').
B. The CITY CDBG Loan and the CITY CDBG Note are secured by a mortgage and
security agreement on the Property granted by Borrower to the CITY, dated the date of the CITY CDBG
Note, in the original principal amount of$700,000, and recorded in the official public records of Pinellas
County, Florida("CITY CDBG Mortgage").
C. Pursuant to a development agreement between CITY and Borrower, dated November 9,
2012 ("CITY NSP3 Development Agreement'), CITY has made available to Borrower a $475,770
Neighborhood Stabilization Program 3 (NSP3) loan ("CITY NSP3 Loan"), as evidenced by a promissory
note dated November 9, 2012 executed by Borrower in favor of CITY ("CITY NSP3 Note"), the
proceeds of which will be used by Borrower to pay a portion of the costs of vertical construction of four
(4) single-family attached homes in one building in the Project on the Property.
D. The CITY NSP3 Loan and the CITY NSP3 Note are, or will be, secured by a mortgage
and security agreement on the Property (1281, 1283, 1285, and 1287 Sawgrass Street, Clearwater,
Florida) granted by Borrower to the CITY, dated November 9, 2012, in the original principal amount of
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$475,770, and intended to be recorded in the official public records of Pinellas County, Florida("CITY
NSP3 Mortgage"). A portion ($32,589.67) of the principal amount of$475,770 will be disbursed at loan
closing. The balance ($443,180.33) will be disbursed from a construction escrow account held by the
CITY to the Borrower in the amounts provided under Section 2 (a) Disbursement Procedures of this
agreement.
E. Pursuant to a loan agreement between COUNTY and Borrower, dated July 22, 2011 and
modified on March 29, 2012, ("COUNTY NSP2 Loan Agreement"), COUNTY has made available to
Borrower a $1,576,800 NSP2 loan ("COUNTY NSP2 Loan"), as evidenced by a promissory note dated
July 22, 2011 and modified on March 29, 2012 executed by Borrower in favor of COUNTY("COUNTY
NSP2 Note"), the proceeds of which were used by Borrower to pay the infrastructure development and
building pad construction costs of the Project.
F. The COUNTY NSP2 Loan and the COUNTY NSP2 Note are secured by a mortgage and
security agreement on the Property granted by Borrower to COUNTY, dated July 22, 2011 and modified
on March 29, 2012, in the principal amount of$1,576,800, and recorded in the official public records of
Pinellas County,Florida("COUNTY NSP2 Mortgage").
G. CITY CDBG loan has been fully disbursed and the property acquired and the COUNTY
NSP2 loan has been substantially disbursed and 90%of the infrastructure completed.
H. CITY and COUNTY(collectively,the"Lenders"and, individually, a"Lender")desire to
set forth and confirm certain agreements and understandings between them with respect to the CITY
CDBG Loan, the CITY NSP3 Loan and the COUNTY NSP2 Loan (collectively, the "Loans" and,
individually, a "Loan"), and the CITY CDBG Mortgage, the CITY NSP3 Mortgage and the COUNTY
NSP2 Mortgage(collectively,the"Mortgages"and, individually, a"Mortgage").
Terms
In consideration of the foregoing and the mutual covenants set forth below, and for other good
and valuable consideration, the receipt and sufficiency of which are acknowledged,the parties, intending
to be legally bound,agree:
1. Additional Defined Terms. In addition to terms defined elsewhere in this Agreement, the
following terms as used in this Agreement shall have the following meanings:
(a) "CITY CDBG Loan Documents" means the CITY CDBG Note, the CITY
CDBG Mortgage, and any other documents or agreements now or in the future evidencing or securing the
CITY CDBG Loan.
(b) "Collection Costs" means the reasonable costs of collection, including without
limitation reasonable attorneys' fees, incurred by the Lenders, or either of them, in connection with the
foreclosure of the Mortgages and the collection of amounts due under the Loan Documents.
(c) "COUNTY NSP2 Loan Documents" means the COUNTY NSP2 Note, the
COUNTY NSP2 Mortgage, and any other documents or agreements now or in the future evidencing or
securing the COUNTY NSP2 Loan.
(d) "Project Equity" means equity being contributed to the Project by Borrower.
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(e) "Protective Costs" means the reasonable costs incurred by the Lenders, or either
of them, in preserving, protecting, paying taxes with respect to, insuring, or maintaining the Property.
(f) "CITY NSP3 Loan Documents" means the CITY NSP3 Development
Agreement, the CITY NSP3 Note, the CITY NSP3 Mortgage, and any other documents or agreements
now or in the future evidencing or securing the CITY NSP3 Loan.
2. Disbursement Procedures.
(a) The parties agree that payment(s) requested by Borrower to pay costs of vertical
construction of the four units in the Project shall be funded by disbursements by the CITY under the
CITY NSP3 Loan, as follows:
Address
Dew i Dra y
1281 Sawgrass Street $32,194.23 $32,194.23 $37,277.54
1283 Saw ass Street $32,194.23 $32,194.23 $37,277.54
1285 Saw ass Street $32,194.23 $32,194.23 $37,277.54
1287 Saw grass Street $32,194.23 $32,194.23 $37,277.54
In addition to the amounts listed above, an additional $36,516.33 will also be held in the
CITY's Construction Escrow for a construction contingency and other related construction-related costs.
(b) The parties designate CITY to administer payment(s), inspections, and other
matters relating to the construction aspects of the four above mentioned units in the Project. All requests
for payment(s) for construction purposes, together with all required supporting materials, shall be
submitted to CITY for approval. All requests for payment(s) shall be in form and substance satisfactory
to CITY and shall be subject to all applicable conditions and procedures governing payments under the
CITY NSP3 Development Agreement; provided, however, that all requests for payments of the CITY
NSP3 Loan shall also be subject to all applicable conditions and procedures governing disbursements
under the CITY NSP3 Development Agreement.
(c) No payment(s) for construction purposes shall be made unless CITY, and
CITY's construction inspector or designee, shall have approved the payment. CITY shall have the
authority to approve any change orders.
(d) Hard costs shall be subject to a retainage of five percent(5%).
(e) CITY and COUNTY shall have equal rights to send a representative to all
progress meetings and similar meetings with respect to the Project. Borrower shall give CITY and
COUNTY not less than five (5) business days' prior notice of progress meetings and similar meetings.
CITY and COUNTY shall have equal rights to any and all information pertaining to the Loans during
construction of the Project.
(f) CITY shall not be liable for any act or omission by it in connection with
disbursements of the COUNTY NSP2 Loan under the COUNTY NSP2 Loan documents in the absence
of negligence or willful misconduct, and shall incur no liability to COUNTY in connection with any acts
or omissions in reliance upon any certificate or other writing believed by CITY in good faith to be
genuine. COUNTY shall not be liable for any act or omission by it in connection with disbursements of
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the CITY NSP3 Loan under the CITY's NSP3 Development Agreement in the absence of negligence or
willful misconduct, and shall incur no liability to CITY in connection with any acts or omissions in
reliance upon any certificate or other writing believed by CITY in good faith to be genuine.
3. Priority of Mortgages.
(a) The relative priority in time of execution or recording of the Mortgages and
related subordination agreements, or the stated amounts secured by the Mortgages, shall remain in force.
Though the COUNTY NSP2 LOAN is to remain in a position senior to both the CITY CDBG LOAN and
the CITY NSP3 LOAN,this agreement permits the repayment of the CITY NSP3 LOAN to be prioritized
in regard to the disbursement of net proceeds from the sale of the four units to which this agreement
pertains.
(b) Each Lender agrees that it shall not contest the validity, perfection, priority, or
enforceability of the Mortgage of the other Lender.
4. Application of Net Proceeds—Sale of Each Housing Unit.
Upon sale of each completed housing unit subject to this agreement, the Net Sales proceeds shall be
determined and disbursed as follows:
• The sales price of each unit shall be determined by the BORROWER and shall not exceed the
appraised value of the unit, nor shall it be less than $142,500 unless BORROWER agrees to
subsidize a lesser sales price through the reduction of BORROWER's profit on the entire project.
• At the time of closing, total sales proceeds less the amount of actual, documented seller closing
costs, shall be applied to the payment of the CITY and COUNTY Loans as follows:
(a) First, the amount of the CITY'S NSP3 Loan in the unit shall be applied to the
payment of the CITY NSP3 Loan for that unit up to a maximum of$118,942.50.
(b) Second, the remaining amount of the sales proceeds shall be applied to the
COUNTY NSP2 Loan.
5. Application of Proceeds—Default and Insurance Proceeds.
All proceeds received by either Lender under, pursuant to, or from its Mortgage after the occurrence of
an event of default, as well as all proceeds of any insurance or taking by eminent domain not applied to
the repair or restoration of the Property, shall be applied in the following order of priority:
(a) first,to the payment of Protective Costs incurred by such Lender;
(b) second,to the payment of Collection Costs incurred by such Lender;
(c) third,to the payment of the accrued and unpaid interest under the COUNTY
NSP2 Note, the CITY NSP3 Note and the CITY CDBG Note and, if there are insufficient proceeds to
pay in full the whole amount of such interest,then to the payment of such interest to the Lenders as their
respective pro rata shares of accrued and unpaid interest may appear;
(d) fourth,to the payment of fees and charges(but not principal and interest)under
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the COUNTY NSP2 Loan Documents, the CITY NSP3 Loan Documents and the CITY CDBG Loan
Documents and, if there are insufficient proceeds to pay in full the whole amount of such fees and
charges,then to the payment of such fees and charges to the Lenders as their respective pro rata shares of
fees and charges may appear;
(e) fifth,to the payment of the outstanding principal of the COUNTY NSP2 Note,
the CITY NSP3 Note and the CITY CDBG Note and, if there are insufficient proceeds to pay in full the
whole amount of such principal,then to the payment of such principal to the Lenders as their respective
pro rata shares of outstanding principal may appear;and
(f) sixth,to Borrower, or as otherwise required by law or a court of competent
jurisdiction may direct.
6. Default;Notification; Consultation, Remedies.
(a) Each Lender agrees that the Loan Documents shall provide that an event of
default under the Loan Documents of either Lender shall constitute an event of default under the Loan
Documents of the other Lender.
(b) Each Lender agrees that prior to the commencement of foreclosure or the
exercise of other rights or remedies with respect to the Property, after the occurrence of an event of
default, it shall give not less than thirty (30) days prior written notice the other Lenders. After such
notice is given,the Lenders shall consult together in good faith to attempt to determine a course of action
to be taken by them collectively. Unless a Lender believes that delay will materially and irreparably
threaten the security of its Mortgage, no Lender shall take action unilaterally to enforce any rights or
remedies against the Property, without first having consulted and attempted in good faith to agree on a
collective course of action with the other Lenders. In the event the Lenders are unable in good faith to
agree on a joint course of action, each Lender shall be free to pursue any and all rights or remedies
available under its Loan Documents or by law or at equity, including the assertion and enforcement of its
respective rights in and to the Property.
(c) Each Lender agrees that, if an event of default should occur under the Loan
Documents of any Lender, then all collections and payments relating to the Property, from whatever
source derived, including, without limitation, all proceeds of the Property, shall be applied as
contemplated by the provisions set forth in Section 5.
(d) Each Lender agrees that, if either Lender exercises any right of foreclosure or
other judicial sale and does not acquire the Property pursuant to such rights at such foreclosure or other
sale, all proceeds received by such Lender in connection with such foreclosure or other sale shall be
applied in accordance with the provisions of Section 5.
(e) Each Lender agrees that, if any Lender exercises any right of foreclosure or other
judicial sale and acquires the Property pursuant to such rights at such foreclosure or other sale, or if any
Lender acquires the Property by a deed in lieu of foreclosure, all proceeds and revenues thereafter
received by such Lender from a subsequent sale, leasing, rental, or other disposition or operation of the
Property shall be applied in accordance with the provisions of Section 5.
7. Expenses. Each Lender shall bear its own costs and expenses (including court costs and
attorney's fees) incurred by it and not recovered from Borrower or from the exercise of its remedies
against the Property, in connection with or arising out of the protection, collection, realization or
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enforcement of its Loan Documents, or the protection, preservation, insurance or maintenance of the
Property.
8. Amendment of Loan Documents. Neither Lender, without the prior written consent of
the other Lender, shall enter into any modification or amendment of its Loan Documents that is likely to
materially adversely affect Borrower or to materially adversely affect the interests of the other Lender in
the Property.
9. Credit Decision. Each Lender acknowledges that it has, independently and without
reliance upon the other Lender, and based upon such documents and information as it has deemed
appropriate, made its own credit analysis and decision to make its loan to Borrower and to enter into and
this Agreement.
10. Other Loans.
(a) Each Lender agrees that it shall have no interest in property taken as security for
any other loans or extensions of credit made to or for the benefit of Borrower by the other Lender, or in
any property or instruments in possession or control of the other Lender, or in any deposits held or other
indebtedness owing to the Lender, which may be or become collateral for or otherwise available for
payment of the CITY and COUNTY Loans, as the case may be, by reason of the general description of
the secured obligations contained in any security agreement or other agreement or instrument so held by
the other Lender, or by reason of the right of setoff,counterclaim, or otherwise.
(b) Each Lender agrees that the Property shall not be taken as security for any other
loans or extensions of credit made by the Lender to or for the benefit of Borrower, without the prior
written consent of the other Lender.
11. Notices. Any notices under this Agreement shall be in writing (or by fax, e-mail, or
similar electronic transmission confirmed in writing) and shall be deemed to have been duly given or
made (i) when delivered by hand, or (ii) if given by mail, three (3) days after deposited in the mails by
certified mail, return receipt requested, sufficient postage prepaid, or (iii) if given by fax, e-mail, or
similar electronic transmission, when sent and receipt has been confirmed, addressed as stated below, or
to such other address as the addressee may have specified in a notice duly given to the other addressees:
To CITY:
City of Clearwater
Economic Development and Housing
112 S. Osceola Ave, 1st Floor
Clearwater, FL 33756
Attn: Geraldine Campos Lopez
Phone: (727) 562-4023 Fax: (727) 562-4037
E-Mail: Geraldine.Lopez @myClearwater.com
To COUNTY:
Pinellas County
Community Development Department
600 Cleveland Street, Suite 800
Clearwater, Florida 33756
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Attn: Anthony M. Jones
Phone: (727)464-8210 Fax: (727)464-8254
E-Mail: ajones @pinellascounty.org
12. Assignment: Binding Effect.
ffect.
(a) This Agreement shall be binding upon and shall inure to the benefit of the
Lenders and their successors and assigns. Each Lender may assign its interests in this Agreement, but it
shall provide written notice of such assignment to the other Lenders.
(b) Borrower is executing this Agreement to evidence its assent to the terms and
provisions this Agreement, but this Agreement is not intended to confer any additional rights upon
Borrower other than those rights contained in the Loan Documents. Without limiting the generality of the
foregoing, it is understood and agreed that any terms and provisions of this Agreement may be modified
or amended by the Lenders without the consent of or notice to Borrower.
13. Recordation. This Agreement shall be recorded in the official public records of Pinellas
County, Florida.
14. Applicable Law. This Agreement shall be governed by, and construed in accordance,
with the laws of the State of Florida.
15. Counterparts. This Agreement may be executed in any number of counterparts, each of
which shall be considered an original and all of which together shall comprise one and the same
instrument.
16. Modifications. No change, modification or waiver of any terms or provision this
Agreement shall be valid,unless in writing and executed by each of the Lenders.
IN WITNESS WHEREOF,the parties have duly executed this Agreement as of the date first
above written.
Attest: CITY OF EARWATER
By:
(2,
ame: Geraldine Campos Lopez
Title: Economic Development and
[Corporate Seal] Housing Director
Attest: PINELLAS COUNTY BOARD OF COUNTY
COMMISSIONERS
By:
Name: Anthony Jones
Title: Community Development
Director
[Corporate Seal]
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Consent
The undersigned consents to and accepts the terms and provisions of this Intercreditor
Agreement.
Attest: SP COUNTRY CLUB HOMES LLC
By:
Secretary J. David Page
Managing Member
[Corporate Seal]
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Countersigned: CITY OF CLEARWATER, FLORIDA
--ctw1ke 01C b0i By: %al&44�—,
George N. Cretekos William B. Horne II
Mayor City Manager
Approved as to form: Attest:
Laura Mahony Rosemarie Call
Assistant City Attorney City Clerk r►
STATE OF FLORIDA )
ss:
COUNTY OF PINELLAS )
I,the undersigned Notary Public of the County and State aforesaid, certify that
personally came before me this day and acknowledged that he/she is the Authorized Signatory of the City
of Clearwater, a municipal corporation under the laws of the State of Florida, and that by authority duly
given and as the act of the corporation,the foregoing instrument was signed in its name by
sealed with its corporate seal and attested by , as its
, as an act and on behalf of said corporation.
Witness my hand and official stamp or seal,this_day of , 20
Notary Public
My Commission Expires:
[AFFIX NOTARY SEAL]
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EXHIBIT A
Legal Description
Lots 28, 29, 30 and 31, of Country Club Townhomes, according to the plat thereof recorded in
Plat Book 137, Pages 16 and 17, of the Public Records of Pinellas County, Florida.
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