MADISON HEIGHTS PHASE I SUBORDINATION AGREEMENT.PDF

Prepared by, and after recording
return to:
Lanre A. Popoola, Esq.
Ballard Spahr LLP
1909 K Street, NW
12th Floor
Washington, DC 20006
SUBORDINATION AGREEMENT
(Affordable)
This SUBORDINATION AGREEMENT (this “Agreement”) dated as of ____________,
2017, is executed by and among (i) CDT II, LLC, a Delaware limited liability company
(“Senior Lender”), (ii) COUNTY OF MARICOPA, an Arizona body politic (“Subordinate
Lender”), and (iii) MADISON HEIGHTS PHASE I, LLC, a Wisconsin limited liability
company (“Borrower”).
RECITALS:
A. Pursuant to that certain Multifamily Loan and Security Agreement dated as of the
date hereof, executed by and between Borrower and Senior Lender (as amended, restated,
replaced, supplemented or otherwise modified from time to time, the “Senior Loan
Agreement”), Senior Lender has agreed to make a loan to Borrower in the original principal
amount of One Million Four Hundred Ten Thousand Five Hundred Forty and 00/100 Dollars
($1,410,540.00) (the “Senior Loan”), as evidenced by that certain Multifamily Note dated as of
the date hereof, executed by Borrower and made payable to the order of Senior Lender in the
amount of the Senior Loan (as amended, restated, replaced, supplemented or otherwise modified
from time to time, the “Senior Note”).
B. In addition to the Senior Loan Agreement, the Senior Loan and the Senior Note
are also secured by a certain Multifamily Mortgage, Deed of Trust or Deed to Secure Debt dated
as of the date hereof (as amended, restated, replaced, supplemented or otherwise modified from
time to time, the “Senior Security Instrument”), encumbering the property more particularly
described in Exhibit A attached hereto (the “Mortgaged Property”).
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C. Borrower has requested Senior Lender to permit the continued effectiveness of
that certain subordinate loan in the amount of Three Hundred Twenty Thousand and 00/100
Dollars ($320,000.00) (the “Subordinate Loan”) from Subordinate Lender to Borrower and to
allow the Subordinate Loan to continue to be secured by a mortgage lien against the Mortgaged
Property.
D. Senior Lender has agreed to permit the Subordinate Loan and to allow the
subordinate mortgage lien against the Mortgaged Property subject to all of the conditions
contained in this Agreement.
AGREEMENTS:
NOW, THEREFORE, in order to induce Senior Lender to permit the continued
effectiveness of Subordinate Loan to Borrower and to allow the Subordinate Loan to continue to
be secured by a subordinate mortgage lien against the Mortgaged Property, and in consideration
thereof, Senior Lender, Subordinate Lender and Borrower agree as follows:
1. Recitals.
The recitals set forth above are incorporated herein by reference.
2. Definitions.
In addition to the terms defined in the Recitals to this Agreement, for purposes of this
Agreement the following terms have the respective meanings set forth below:
“Affiliate” means, when used with respect to a Person, any corporation, partnership, joint
venture, limited liability company, limited liability partnership, trust or individual controlled by,
under common control with, or which controls such Person (the term “control” for these
purposes shall mean the ability, whether by the ownership of shares or other equity interests, by
contract or otherwise, to elect a majority of the directors of a corporation, to make management
decisions on behalf of, or independently to select the managing partner of, a partnership, or
otherwise to have the power independently to remove and then select a majority of those
individuals exercising managerial authority over an entity, and control shall be conclusively
presumed in the case of the ownership of fifty percent (50%) or more of the equity interests).
“Borrower” means the Person named as such in the first paragraph on page 1 of this Agreement,
any successor or assign of Borrower, including without limitation, a receiver, trustee or debtor-
in-possession and any other Person (other than Senior Lender) who acquires title to the
Mortgaged Property after the date of this Agreement.
“Business Day” means any day other than Saturday, Sunday or a day on which Senior Lender is
not open for business.
“Deed Restriction” means that certain Declaration of Covenants, Conditions, and Restrictions
recorded on October 1, 2015 as Instrument No. 20150709048.
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“Default Notice” means: (a) a copy of any written notice from Senior Lender to Borrower and
Subordinate Lender stating that a Senior Loan Default has occurred under the Senior Loan
Documents; or (b) a copy of the written notice from Subordinate Lender to Borrower and Senior
Lender stating that a Subordinate Loan Default has occurred under the Subordinate Loan
Documents. Each Default Notice shall specify the default upon which such Default Notice is
based.
“Person” means an individual, an estate, a trust, a corporation, a partnership, a limited liability
company or any other organization or entity (whether governmental or private).
“Senior Lender” means the Person named as such in the first paragraph on Page 1 of this
Agreement, its successors and assigns and any other Person who becomes the legal holder of the
Senior Loan after the date of this Agreement.
“Senior Loan Default” means the occurrence of an “Event of Default” as that term is defined in
the Senior Loan Documents.
“Senior Loan Documents” means the Senior Security Instrument, the Senior Note, the Senior
Loan Agreement, and all other “Loan Documents” as that term is defined in the Senior Loan
Agreement.
“Subordinate Lender” means the Person named as such in the first paragraph on page 1 of this
Agreement, any successor or assign of Subordinate Lender, including without limitation, a
receiver, trustee or debtor-in-possession and any other Person who becomes the legal holder of
the Subordinate Note after the date of this Agreement.
“Subordinate Loan Default” means a default by Borrower in performing or observing any of
the terms, covenants or conditions in the Subordinate Loan Documents to be performed or
observed by it, which continues beyond any applicable period provided in the Subordinate Loan
Documents for curing the default.
“Subordinate Loan Documents” means the Subordinate Note, the Subordinate Mortgage, the
Deed Restriction and all other documents evidencing, securing or otherwise executed and
delivered in connection with the Subordinate Loan.
“Subordinate Mortgage” means that certain Deed of Trust recorded on October 1, 2015, as
Instrument No. 20150710257 in the official records of Maricopa County, Arizona, encumbering
the Mortgaged Property as security for the Subordinate Loan.
“Subordinate Note” means the promissory note dated as of September 29, 2015, issued by
Borrower to Subordinate Lender, or order, to evidence the Subordinate Loan.
3. Permission to Place Mortgage Lien Against Mortgaged Property.
The Senior Lender agrees, notwithstanding the prohibition against inferior liens on the
Mortgaged Property contained in the Senior Loan Documents and subject to the provisions of this
Agreement, to permit the continuation of the Subordinate Mortgage and all other Subordinate Loan
Documents securing the Borrower’s obligation to repay the Subordinate Loan and all other
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obligations, indebtedness and liabilities of the Borrower to the Subordinate Lender under and in
connection with the Subordinate Loan.
4. Borrower’s Representations and Warranties.
Borrower makes the following representations and warranties to Senior Lender:
(a) Subordinate Loan Documents.
The Subordinate Loan is evidenced by the Subordinate Note and is secured by the
Subordinate Mortgage, the Subordinate Loan Agreement, Deed Restriction, and the Subordinate
Loan Documents.
(b) Relationship of Borrower to Subordinate Lender and Senior Lender.
Subordinate Lender is not an Affiliate of Borrower and is not in possession of any facts
which would lead it to believe that Senior Lender is an Affiliate of Borrower.
(c) Term.
The term of the Subordinate Note is twenty three (23) years, ending on June 1, 2038.
(d) Subordinate Loan Documents.
True and correct copies of each of the executed Subordinate Loan Documents have been
delivered to Senior Lender prior to the date of this Agreement.
(e) Senior Loan Documents.
Upon the execution and delivery of the Senior Loan Documents, Borrower shall deliver
to Subordinate Lender an executed copy of each of the Senior Loan Documents.
5. Terms of Subordination.
(a) Agreement to Subordinate.
Senior Lender and Subordinate Lender agree that (1) the Deed Restriction shall take
priority over, and shall not be subject or subordinate to the Senior Loan Documents, (2). the
indebtedness evidenced by the Subordinate Loan Documents is and shall be subordinated in right
of payment, to the extent and in the manner provided in this Agreement, to the prior payment in
full of the Indebtedness evidenced by the Senior Loan Documents, and (2) the liens, terms,
covenants and conditions of the Subordinate Mortgage and the other Subordinate Loan
Documents (other than the Deed Restriction) are and shall be subject and subordinate in all
respects to the liens, terms, covenants and conditions of the Senior Security Instrument and the
other Senior Loan Documents and to all advances heretofore made or which may hereafter be
made pursuant to the Senior Security Instrument and the other Senior Loan Documents
(including but not limited to, all sums advanced for the purposes of (A) protecting or further
securing the lien of the Senior Security Instrument, curing defaults by Borrower under the Senior
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Loan Documents or for any other purpose expressly permitted by the Senior Loan Documents, or
(B) constructing, renovating, repairing, furnishing, fixturing or equipping the Mortgaged
Property).
(b) Subordination of Subrogation Rights.
Subordinate Lender agrees that if, by reason of its payment of real estate taxes or other
monetary obligations of Borrower, or by reason of its exercise of any other right or remedy under
the Subordinate Loan Documents, it acquires by right of subrogation or otherwise a lien on the
Mortgaged Property which (but for this subsection) would be senior to the lien of the Senior
Security Instrument, then, in that event, such lien shall be subject and subordinate to the lien of
the Senior Security Instrument.
(c) Priority of Deed Restriction.
Senior Lender hereby agrees that, notwithstanding anything to the contrary set forth
elsewhere herein, following a foreclosure under the Senior Security Instrument, or the
acceptance by Senior Lender of a deed to the Mortgaged Property in lieu of such a foreclosure
(each, a “Foreclosure Action”), the Deed Restriction shall survive and the successor owner of
the Property shall acquire the Property subject to all of the terms and conditions of the Deed
Restriction, except as otherwise expressly provided below, but this paragraph shall not affect
the enforceability of the Subordinate Loan Documents against Borrower or affect obligations
contained in the Deed Restriction merely because the same or similar obligations are contained
in other Subordinate Loan Documents:
(i) No successor owner shall be obligated under the Restrictive Covenants to
make any payment under the Subordinate Note, or to otherwise comply with, any of the
Subordinate Loan Documents (other than the Deed Restriction);
(ii) The Foreclosure Action and the transfer of the Property pursuant to the
Foreclosure Action will not violate the limitations on transfers in the Deed Restriction or
require the approval of the Subordinate Lender;
(iii) Neither Senior Lender nor any immediate successor in interest of such
party, shall be obligated to pay, or otherwise have any liability for or in connection with,
any claim by Subordinate Lender for liquidated damages, for indemnification or for
damages in connection with any breach of any term or provision of the Deed Restriction
occurring prior to the date upon which such successor owner acquired title to the
Property; and
(iv) Senior Lender (or the party acquiring the Mortgaged Property at or
pursuant to a Foreclosure Event) shall only be required to cure continuing defaults under
the Deed Restriction related to the Mortgaged Property; provided further, however, that
each such successor owner shall have 120 days after the date upon which it acquires title
to the Mortgaged Property to cure such continuing defaults.
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6. Default Under Subordinate Loan Documents.
(a) Estoppel; Notice of Subordinate Loan Default.
Subordinate Lender hereby certifies and confirms to Senior Lender and its transferees,
successors and assigns, that (i) there are no existing defaults or unfulfilled obligations on the part
of Borrower under any of the terms and conditions of the Subordinate Loan Documents and (ii)
no event has occurred or condition exists which, with the passing of time or giving of applicable
notice, would constitute an event of default under the Subordinate Loan Documents.
Subordinate Lender shall deliver to Senior Lender a Default Notice within five (5) Business
Days in each case where Subordinate Lender has given a Default Notice to Borrower. Failure of
Subordinate Lender to send a Default Notice to Senior Lender shall not prevent the exercise of
Subordinate Lender’s rights and remedies under the Subordinate Loan Documents, subject to the
provisions of this Agreement. Senior Lender shall have the right, but not the obligation, to cure
any Subordinate Loan Default within sixty (60) days following the date of such notice; provided,
however that Subordinate Lender shall be entitled, during such sixty (60) day period, to seek
specific performance to enforce covenants and agreements of Borrower relating to income, rent,
or affordability restrictions contained in the Deed Restriction and any land use restriction
agreement. All amounts paid by Senior Lender in accordance with the Senior Loan Documents
to cure a Subordinate Loan Default shall be deemed to have been advanced by Senior Lender
pursuant to, and shall be secured by, the Senior Loan Agreement and the lien of the Senior
Security Instrument.
(b) Subordinate Lender’s Exercise of Remedies After Notice to Senior Lender.
If a Subordinate Loan Default occurs and is continuing, Subordinate Lender agrees that,
without Senior Lender’s prior written consent, it will not commence foreclosure proceedings
with respect to the Mortgaged Property under the Subordinate Loan Documents or exercise any
other rights or remedies it may have under the Subordinate Loan Documents, including, but not
limited to accelerating the Subordinate Loan (and enforcing any “due on sale” provision included
in the Subordinate Loan Documents), collecting rents, appointing (or seeking the appointment
of) a receiver or exercising any other rights or remedies thereunder unless and until it has given
Senior Lender at least sixty (60) days prior written notice; during such sixty (60) day period,
however, Subordinate Lender shall be entitled to seek specific performance to enforce covenants
and agreements of Borrower relating to income, rent, or affordability restrictions contained in the
Deed Restriction and any land use restriction agreement.
7. Default Under Senior Loan Documents.
(a) Notice of Senior Loan Default and Cure Rights.
Senior Lender shall deliver to Subordinate Lender a Default Notice within five (5)
Business Days in each case where Senior Lender has given a Default Notice to Borrower.
Failure of Senior Lender to send a Default Notice to Subordinate Lender shall not prevent the
exercise of Senior Lender’s rights and remedies under the Senior Loan Documents, subject to the
provisions of this Section 7(a), nor shall such failure constitute a default by Senior Lender under
this Agreement. Subordinate Lender shall have the right, but not the obligation, to cure any such
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Senior Loan Default within sixty (60) days following the date of such Default Notice or the date
on which Subordinate Lender otherwise acquires actual knowledge of Senior Loan Default;
provided, however, that Senior Lender shall be entitled during such sixty (60) day period to
continue to pursue its remedies under the Senior Loan Documents. Subordinate Lender may
have up to ninety (90) days from the date of the Default Notice to cure a non-monetary default if
during such ninety (90) day period Subordinate Lender keeps current all payments required by
the Senior Loan Documents. All amounts paid by Subordinate Lender to Senior Lender to cure a
Senior Loan Default shall be deemed to have been advanced by Subordinate Lender pursuant to,
and shall be secured by the Subordinate Mortgage Loan Agreement and the lien of the
Subordinate Mortgage.
8. Conflict.
Borrower, Senior Lender and Subordinate Lender each agrees that, in the event of any
conflict or inconsistency between the terms of the Senior Loan Documents, the Subordinate Loan
Documents and the terms of this Agreement, the terms of this Agreement shall govern and
control solely as to the following: (a) the relative priority of the security interests of Senior
Lender and Subordinate Lender in the Mortgaged Property; (b) the timing of the exercise of
remedies by Senior Lender and Subordinate Lender under the Senior Loan Documents and the
Subordinate Loan Documents, respectively; and (c) solely as between Senior Lender and
Subordinate Lender, the notice requirements, cure rights, and the other rights and obligations
which Senior Lender and Subordinate Lender have agreed to as expressly provided in this
Agreement. Borrower acknowledges that the terms and provisions of this Agreement shall not,
and shall not be deemed to: extend Borrower’s time to cure any Senior Loan Default or
Subordinate Loan Default, as the case may be; give Borrower the right to notice of any Senior
Loan Default or Subordinate Loan Default, as the case may be other than that, if any, provided,
respectively under the Senior Loan Documents or the Subordinate Loan Documents; or create
any other right or benefit for Borrower as against Senior Lender or Subordinate Lender.
9. Condemnation or Casualty.
In the event of: a taking or threatened taking by condemnation or other exercise of
eminent domain of all or a portion of the Mortgaged Property (collectively, a “Taking”); or the
occurrence of a fire or other casualty resulting in damage to all or a portion of the Mortgaged
Property (collectively, a “Casualty”), at any time or times when the Senior Security Instrument
remains a lien on the Mortgaged Property the following provisions shall apply:
(1) Subordinate Lender hereby agrees that its rights (under the Subordinate
Loan Documents or otherwise) to participate in any proceeding or action relating to a
Taking and/or a Casualty, or to participate or join in any settlement of, or to adjust, any
claims resulting from a Taking or a Casualty shall be and remain subject and subordinate
in all respects to Senior Lender’s rights under the Senior Loan Documents with respect
thereto, and Subordinate Lender shall be bound by any settlement or adjustment of a
claim resulting from a Taking or a Casualty made by Senior Lender; provided, however,
this subsection and/or anything contained in this Agreement shall not limit the rights of
Subordinate Lender to file any pleadings, documents, claims or notices with the
appropriate court with jurisdiction over the proposed Taking and/or Casualty; and
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(2) all proceeds received or to be received on account of a Taking or a
Casualty, or both, shall be applied (either to payment of the costs and expenses of repair
and restoration or to payment of the Senior Loan) in the manner determined by Senior
Lender in its sole discretion; provided, however, that if Senior Lender elects to apply
such proceeds to payment of the principal of, interest on and other amounts payable
under the Senior Loan, any proceeds remaining after the satisfaction in full of the
principal of, interest on and other amounts payable under the Senior Loan shall be paid
to, and may be applied by, Subordinate Lender in accordance with the applicable
provisions of the Subordinate Loan Documents, provided however, Senior Lender agrees
to consult with Subordinate Lender in determining the application of Casualty proceeds,
provided further however that in the event of any disagreement between Senior Lender
and Subordinate Lender over the application of Casualty proceeds, the decision of Senior
Lender, in its sole discretion, shall prevail.
10. Notices.
All notices or demands hereunder to the parties hereto shall be sufficient if made in writing and
(a) delivered in person, (b) deposited in the mail, certified, postage prepaid, or (c) delivered by a
recognized overnight carrier (such as Federal Express) and addressed to the parties respectively
as follows:
If to Subordinate Lender:
Maricopa County Human Services Department
234 N. Central Ave., Suite 300
Phoenix, AZ 85004
Attention: Rachel Milne, Housing and Community
Development Assistant Director
If to the Owner: Madison Heights Phase I, LLC
200 N. Main Street
Oregon, WI 53575
Attention: Gary J. Gorman, President, Gorman &
Company, Inc.
With a copy to: Gorman & Company, Inc.
4700 N. Central Ave., Ste. 117
Phoenix, AZ 85012
Attention: Brian Swanton
If to Senior Lender:
The Community Development Trust, LP
1350 Broadway, Suite 700
New York, New York 10018
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Notice shall be deemed to be effective upon delivery if hand delivered; forty eight (48) hours
from the date such notice is deposited in the U.S. mail or, one (1) business day from the date
such notice is delivered to a recognized overnight carrier for next business day delivery
(a) Change of Address.
Any party to Agreement may change the address to which notices intended for it are to be
directed by means of notice given to the other parties identified in this Agreement.
(b) Receipt of Notices.
Senior Lender, Subordinate Lender or Borrower shall not refuse or reject delivery of any
notice given in accordance with this Agreement. Each party is required to acknowledge, in
writing, the receipt of any notice upon request by the other party.
11. General.
(a) Assignment/Successors.
This Agreement shall be binding upon Borrower, Senior Lender and Subordinate Lender
and shall inure to the benefit of the respective legal successors, transferees and assigns of
Borrower, Senior Lender and Subordinate Lender. Borrower shall not assign any of its rights
and obligations under this Agreement without the prior written consent of Senior Lender.
(b) No Partnership or Joint Venture.
Senior Lender’s permission for the placement of the Subordinate Loan does not constitute
Senior Lender as a joint venturer or partner of Subordinate Lender. Neither party hereto shall
hold itself out as a partner, agent or Affiliate of the other party hereto.
(c) Senior Lender’s and Subordinate Lender’s Consent.
Wherever Senior Lender’s consent or approval is required by any provision of this
Agreement, such consent or approval may be granted or denied by Senior Lender in its sole and
absolute discretion, unless otherwise expressly provided in this Agreement. Wherever
Subordinate Lender’s consent or approval is required by any provision of this Agreement, such
consent or approval may be granted or denied by Subordinate Lender in its sole and absolute
discretion, unless otherwise expressly provided in this Agreement. Notwithstanding the
foregoing, in the event and to the extent that Senior Lender and Subordinate Lender each have
under their respective loan documents certain approval or consent rights over the same subject
matters (regardless of whether the obligations or rights are identical or substantially identical),
Senior Lender and Subordinate Lender each agree that their respective approvals and/or consents
shall not be unreasonably withheld, delayed or conditioned.
(d) Further Assurances.
Subordinate Lender, Senior Lender and Borrower each agrees, at Borrower’s expense, to
execute and deliver all additional instruments and/or documents reasonably required by any other
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party to this Agreement in order to evidence that the Subordinate Mortgage is subordinate to the
lien, covenants and conditions of the Senior Loan Documents, or to further evidence the intent of
this Agreement.
(e) Entire Agreement.
This Agreement contains the entire agreement between the parties with respect to the
subordination of the Existing Documents.
(f) Binding Effect; No Oral Modification.
This Agreement and every covenant hereof shall be binding upon the Parties and their
respective successors and assigns. This Agreement shall not be modified or amended except by
a written instrument executed by all parties hereto and approved in writing by HUD, if required.
(g) Amendment.
This Agreement shall not be amended except by written instrument signed by all parties
hereto.
(h) Governing Law.
This Agreement is made and executed under and will be governed and construed by the
laws of the State of Arizona. Senior Lender, Subordinate Lender and Borrower agree that any
controversy arising under or in relation to this Security Instrument shall be litigated exclusively
in Maricopa County. The parties hereto irrevocably consent to service, jurisdiction, and venue of
such courts for any such litigation and waive any other venue to which any might be entitled by
virtue of domicile, habitual residence or otherwise.
(i) Severable Provisions.
If any provision of this Agreement shall be invalid or unenforceable to any extent, then
the other provisions of this Agreement, shall not be affected thereby and shall be enforced to the
greatest extent permitted by law.
(j) Term.
The term of this Agreement shall commence on the date hereof and shall continue until
the earliest to occur of the following events: (1) the payment in full of the principal of, interest
on and other amounts payable under the Senior Loan Documents; (2) the payment in full of the
principal of, interest on and other amounts payable under the Subordinate Loan Documents,; (3)
the acquisition by Senior Lender of title to the Mortgaged Property pursuant to a foreclosure or a
deed in lieu of foreclosure of, or the exercise of a power of sale contained in, the Senior Loan
Documents; or (4) the acquisition by Subordinate Lender of title to the Mortgaged Property
pursuant to a foreclosure or a deed in lieu of foreclosure of, or the exercise of a power of sale
contained in, the Subordinate Loan Documents..
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(k) Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be
considered an original for all purposes; provided, however, that all such counterparts shall
together constitute one (1) and the same instrument.
(l) Sale of Senior Loan.
Nothing in this Agreement shall limit Senior Lender’s (including any assignee or
transferee of Senior Lender) right to sell or transfer the Senior Loan, or any interest in the Senior
Loan. The Senior Loan or a partial interest in the Senior Loan (together with this Agreement and
the other Loan Documents) may be sold one or more times without prior notice to Borrower.
[Remainder of Page Intentionally Blank]
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IN WITNESS WHEREOF, Borrower, Senior Lender and Subordinate Lender have
signed and delivered this Agreement under seal (where applicable) or have caused this
Agreement to be signed and delivered under seal (where applicable) by a duly authorized
representative. Where applicable law so provides, Borrower, Senior Lender and Subordinate
Lender intend that this Agreement shall be deemed to be signed and delivered as a sealed
instrument.
SENIOR LENDER:
CDT II, LLC, a Delaware limited liability
company
By: THE COMMUNITY DEVELOPMENT
TRUST, LP, a Delaware limited
partnership, its managing member
By: THE COMMUNITY
DEVELOPMENT TRUST, INC., a
Maryland corporation, its general
partner
By: ___________________
Brian Gallagher
Senior Vice President-Debt
Address: c/o The Community Development
Trust, LP
1350 Broadway, Suite 700
New York, New York 10018
ACKNOWLEDGMENT
State of )
County of ) ss.:
On the ______ day of _________________ in the year 2017, before me, the undersigned,
personally appeared BRIAN GALLAGHER, personally known to me or proved to me on the
basis of satisfactory evidence to be the individual(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
capacity(ies), and that by his/her/their signatures on the instrument, the individual(s), or the
person upon behalf of which the individual(s) acted, executed the instrument.
Notary Public
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SUBORDINATE LENDER:
COUNTY OF MARICOPA,
an Arizona body politic
By: ________________________________
Name:
Title:
Address: 234 N. Central Avenue, Suite 300
Phoenix, AZ 85004
ACKNOWLEDGMENT
STATE OF )
COUNTY OF ) ss:
On this ______ day of ______________________, 2017, before me, the undersigned, a
Notary Public in and for the jurisdiction aforesaid, duly commissioned and sworn, personally
appeared _________________________, to me known to be the individual described in the
foregoing instrument and acknowledged that he/she executed the same. If this person's name is
subscribed in a representative capacity, it is for the principal named and in the capacity indicated.
_______________________ ______________________________
Notary Expiration Date Signature of Notary Public
[STAMP/SEAL]
Subordination Agreement Page S-2

BORROWER:
MADISON HEIGHTS PHASE I, LLC, a
Wisconsin limited liability company
By: MADISON HEIGHTS PHASE I MM,
LLC, a Wisconsin limited liability
company, its Managing Member
By: GORMAN EMPLOYEE GROUP
MADISON HEIGHTS PHASE I,
LLC, a Wisconsin limited liability
company, its Manager
By: GORMAN & COMPANY,
INC., a Wisconsin
corporation, its Manager
By:_____________________
Gary J. Gorman
President
Address: 2375 East Camelback Road
6th Floor
Phoenix, AZ 85016
ACKNOWLEDGMENT
STATE OF )
) ss:
COUNTY OF )
On this the _____ day of _____________ 2017, before me, the undersigned officer, personally
appeared GARY J. GORMAN, President of Gorman & Company, Inc., the Manager of Gorman
Employee Group Madison Heights Phase I, LLC, the Manager of Madison Heights Phase I MM,
LLC, the Managing Member of MADISON HEIGHTS PHASE I, LLC, a Wisconsin limited
liability company, known to me (or satisfactorily proven) to be the person whose name is
subscribed to the within instrument and acknowledged that he executed the same for the
purposes therein contained.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
____________________________________
Notary Public
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EXHIBIT A
DESCRIPTION OF THE LAND
Subordination Agreement Page A-1
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