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HomeMy WebLinkAboutReso 13-1995RESOLUTION NO. 13-95 CITY COUNCIL, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA A RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE AN ASSIGNMENT OF LEASE AND CONSENT OF LANDLORD AND AN AGREEMENT BETWEEN LESSORS AND BANK FOR INN DEVELOPMENT INCORPORATED RELATED TO THE OYSTER POINT MARINA INN GROUND LEASE WHEREAS, by Resolution 133-89, the city Council previously entered into a ground lease with Inn Development Incorporated and the San Mateo County Harbor District related to the ground underlying the Oyster Point Inn; WHEREAS, Inn Development Incorporated has recently sought to refinance the loans related to its development; WHEREAS, as part of that refinancing, Inn Development Incorporated is required to obtain the consent of the lessors, including the City of South San Francisco; WHEREAS, all terms of the preexisting lease will continue to be enforceable with the only change being the approval of the assignment of the lease to Commercial Bank of Fremont as the new project lender; and WHEREAS, the San Mateo County Harbor District has approved the assignment to the Commercial Bank of Fremont; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South San Francisco, that: 1. The City Manager is authorized to execute the assignment of lease and consent of landlord; 2. The City Manager is further authorized to execute the Agreement Between Lessors and Bank for Inn Development Incorporated. I hereby certify that the foregoing Resolution was regularly introduced and adopted by the City Council of the City of South San Francisco at a regular meeting held on the 8th day of March , 1995, by the following vote: AYES: NOES: ABSTAIN: ABSENT: Councilmembers Joseph A. Fernekes, John R. Penna, Roberta Cerri Teqlia and Mayor Robert Yee None None Councilmember Jack Draqo \wpd\mnrsw\405 \re$o [ ut i \ inn. mO3 ATTEST: EXHIBIT TO RESOLUTION NO. 13-95 RECORDED AT THE REQUEST OF AND WHEN RECORDED RETURN TO: City Clerk Barbara A. Battaya 400 Grand Avenue South San Francisco, CA 94080 AGREEMENT BETWEEN LESSORS AND BANK THIS AGREEMENT BETWEEN LESSORS AND BANK (the "Agreement") is made thisSth day of March , 1995 ("Reference Date"), by and between THE SAN MATEO COUNTY HARBOR DISTRICT, a political subdivision of the State of California ("Harbor District"), the CITY OF SOUTH SAN FRANCISCO, a municipal corporation ("City"), and COMMERCIAL BANK OF FREMONT, a California banking association ("Bank"). The Harbor District and the City are hereinafter together sometimes referred to as "Lessors." A. Lessors own the following real property ("Land") : That certain real property located in the City of South San Francisco, County of San Mateo, State of California, described as Parcel "D-i" as shown on that certain map entitled "Parcel Map 89-262, South San Francisco, San Mateo County, California" filed in the Office of the Recorder of San Mateo County, State of California on May 23, 1989 in Book 62 of Parcel Maps at pages 25 and 26. APN 015-010-260; JPN 105-01-010- 7.03.01. B. Lessors and INN DEVELOPMENT, INC., a California corporation ("Lessee"), are parties to that certain Lease dated September 14, 1989, as amended from time to time ("Lease"). A memorandum of the Lease was recorded on October 13, 1989 in the Official Records of the Recorder of San Mateo County, California as Document No. 89137949. Pursuant to the Lease, Lessors leased the Land to Lessee and Lessee leased the Land from Lessors. C. As a separate matter, Lessee, as borrower, and the Bank, as lender, have or are about to execute: (i) that certain Business Loan Agreement ($1,689,000 Term Loan); and (ii) that certain Small Business Administration Business Loan Agreement ($450,000 SBA Loan) (respectively, the "$1,689,000 Loan Agreement" and the "SBA Loan Agreement." D. Pursuant to the $1,689,000 Loan Agreement, Bank intends to loan Lessee $1,689,000 ("$1,689,000 Loan"), which Loan will be evidenced by a $1,689,000 promissory note and secured by, among other things, a first priority lien of a Leasehold Deed of Trust, Assignment of Leases and Rents, Security Agreement and GCS JNIB1VISF%35958 1 56693 0030 02/16/95 1 All Fixture Filing encumbering Lessee's interest in the Lease. documents and instruments evidencing or relating to the $1,689,000 Loan are hereinafter together referred to as the "$1,689,000 Loan Documents." E. Pursuant to the SBA Loan Agreement, Bank intends to loan Lessee $450,000 ("SBA Loan"), which Loan will be evidenced by a $450,000 promissory note and secured by, among other things, a second priority lien of a Leasehold Deed of Trust encumbering Lessee's interest in the Lease. All documents and instruments evidencing or relating to the SBA Loan are hereinafter together referred to as the "SBA Loan Documents." F. Bank requires, as a condition to making the $1,689,000 Loan and the SBA Loan, that Lessors execute this Agreement in favor of Bank. NOW, THEREFORE, in consideration of the covenants and conditions hereinafter set forth, and for other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, the undersigned agree as follows: 1. Recitals. The foregoing recitals are incorporated by reference as if fully set forth herein. 2. Definitions. a. $1,689,000 Loan Period. The period of time during which any amount or amounts remain due and owing pursuant to or in connection with the $1,689,000 Loan Documents is hereinafter referred to as the "$1,689,000 Loan Period." b. SBA Loan Period. The period of time during which any amount or amounts remain due and owing pursuant to or in connection with the SBA Loan Documents is hereinafter referred to as the "SBA Loan Period." c. Lessee Bankruptcy. The occurrence of any one or more of the following events during either the $1,689,000 Loan Period or the SBA Loan Period shall hereinafter be referred to as a "Lessee Bankruptcy": (i) Lessee shall file any petition or action for relief under any bankruptcy, insolvency, reorganization, moratorium, creditor composition law, or any other law for the relief of or relating to debtors; or (ii) an involuntary petition shall be filed under any bankruptcy law against Lessee or a custodian, receiver, trustee, assignee for the benefit of creditors, or other similar official, shall be appointed to take possession, custody or control of the properties of Lessee. d. Rejection of Lease. A "Rejection of Lease" shall be deemed to occur if, during any Lessee Bankruptcy: (i) Lessee as debtor-in-possession, or any trustee or receiver or creditor's committee or other similar person or entity appointed GCS JMBMSF%35955 ! 56693 0030 02/16/95 2 by the bankruptcy court, elects to and does reject the Lease pursuant to any applicable provision of any bankruptcy law, rule or regulation; and (ii) as a consequence of said rejection, the Lease terminates, expires and has no further force or effect. 3. Agreement. If a Rejection of Lease occurs during either the $1,689,000 Loan Period or the SBA Loan Period, Lessors agree as follows: a. RiGht To Enter Into New Lease. So long there are no uncured events of default under the Lease and~or Bank has cured all events of default, Bank shall have the right and option, upon delivery of written notice thereof to Lessors within sixty (60) calendar days following the effective date of a Rejection of Lease, to enter into a new lease for the Land with Lessors ("New Lease"), on the same terms and conditions, at the same rent, for the then unexpired term of the Lease (including the right to exercise any then unexercised options to extend the term thereof). Provided, however, the New Lease shall grant the Bank the right to sell, assign, transfer and convey the New Lease to a third party or entity (a "Transfer"), which Transfer shall be subject to the prior written consent of Lessors and the general conditions of the current Lease, which consent shall not be unreasonably or untimely withheld and which decision shall be made in good faith based on commercially reasonable standards, in which event Bank shall be relieved of any further obligation or liability thereunder. b. Cooperation. Lessors agree to cooperate with Bank and, following receipt of any notice delivered by Bank to Lessors pursuant to paragraph 3.a. above, shall execute any and all documents and instruments, including a New Lease, reasonably required to effect the transaction referenced above. 4. Entire A~reement. This Agreement contains the entire agreement between the parties hereto. 5. Successors and Assigns. This Agreement shall bind the heirs, personal representatives, successors and assigns of each party and inure to the benefit of each party, its agents, officers, employees, servants, successors and assigns. 6. Attorneys' Fees. If any action or proceeding (whether or not judicial) is brought by either party to remedy a breach of this Agreement or to enforce or interpret any of its provisions, the prevailing party shall be entitled, in addition to any other relief granted in such action or proceeding, to reasonable attorneys' fees, disbursements and court costs. 7. Governin~ Law/Venue. This Agreement shall be interpreted pursuant to the laws of the State of California. Any legal action or proceeding brought by any party hereto shall be brought in the County of San Mateo, California. GCS .INIB1%ISF%35988 1 56693 0030 02/16/95 3 8. No Modifications Unless In Writing. The parties understand and agree that this Agreement may not be altered, amended, modified or otherwise changed in any respect or any particular whatsoever, except in writing, duly executed by each of the parties to this Agreement or their authorized representatives. 9. Time of the Essence. Time is of the essence in the performance of each and every term and condition of this Agreement. 10. Authority. Each party executing this Agreement hereby covenants and warrants to the other party that it has full right and authority to enter into this Agreement. 11. Recordation. Bank shall record this Agreement as an encumbrance against the Lease, senior to any of the $1,689,000 Loan Documents and/or the SBA Loan Documents. This AGREEMENT BETWEEN LESSORS AND BANK was executed on the Reference Date, in San Mateo, California. BANK LESSORS C©MMERCIAL BANK OF FREMONT, a California banking association, SAN MATEO COUNTY HARBOR DISTRICT, a political subdivision of the State of California, By: William L. Stone, Senior Vice President ATTEST: ATTEST: ATTORNEY FOR SAN MATEO HARBOR DISTRICT Name :/~~~. ~~ CITY OF SOUTH SAN FRANCISCO, a municipal corpQration, ~ Name: Michapl A. Wil qnn Title: City Managpr ATTEST: CITY ATTORNEY FOR THE CITY OF SOUTH SAN FRANCISCO Name: Title GCS JMBMSFt35988 1 56693 0030 02/16/95 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT NO. 5907 State of ~,~/.1F6~'~/,~z County of .S'A/U ,/~/-ITE,,5 On 3-.~- ~,~'" DATE personally appeared before me, ,/~,~ET'//~ /~. ~,~',~/.z~,"D-,,~UA/E~' , NAME, TITLE OF OFFICER - E,G,, "JANE DOE, NOTARY PUBLIC' NAME(S) OF SIGNER(S) '~ cnown to me - OR - [] 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 ac- knowledged 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.  OFFICIAL SEAL ~;' ' '%~: MARTHA M. Br,~DWN-BUNES Notary Public-California  SAN MATEO COUNTY My Commission Expires May 19, 1995 WITNESS my hand and official seal. OPTIONAL' Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form. CAPACITY CLAIMED BY SIGNER [] INDIVIDUAL [] CORPORATE OFFICER TrrLE(S) [] PARTNER(S) [] LIMITED [] GENERAL [] A'I=I'ORNEY-IN-FACT [] TRUSTEE(S) [] GUARDIAN/CONSERVATOR DESCRIPTION OF ATTACHED DOCUMENT TITLE OR TYPE OF DOCUMENT NUMBER OF PAGES DATE OF DOCUMENT SIGNER IS REPRESE~NG: ~ME OF PER~N(S) OR E~(IES) ,~ ~ 01993 NATIONAL NOTARY ASSOCIATION * 8236 Remmet Ave. P.O. Box 7184 * Canoga Park, CA 91309-7184 ACKNOWLEDGEMENTS State of California County of SS On , 1995, before me, , personally appeared , personally known to me (or 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 (Seal) State of California County of SS On , 1995, before me, , personally appeared , personally known to me (or 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 (Seal) GCS JMBMSF%35988 1 56693 0030 02/16/95 State of California County of SS On , 1995, before me, , personally appeared , personally known to me (or 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 (Seal) GCS JMB1%ISF%35958 1 56693 0030 02/16/95 2 RECORDED AT THE REQUEST OF AND WHEN RECORDED RETURN TO: City Clerk Barbara A. Battaya 400 Grand Avenue So. San Francisco, CA 94080 ASSIGNMENT OF LEASE AND CONSENT OF LESSORS Borrower and Lessee: INN DEVELOPMENT, INC. 425 Marina Boulevard South San Francisco, California 94080 ATTN: Douglas S. Conover, President Lender: COMMERCIAL BANK OF FREMONT 39510 Paseo Padre Parkway Fremont, California 94538 ATTN: William L. Stone, Sr. Vice President Lessors: SAN MATEO COUNTY HARBOR DISTRICT ATTN: CITY OF SOUTH SAN FRANCISCO ATTN: Lessors and Lessee are parties to that certain Lease dated September 14, 1989, as amended from time to time ("Lease"). A memorandum of the Lease was recorded on October 13, 1989 in the Official Records of the Recorder of San Mateo County, California as Document No. 89137949. Lessors own, and the Lease encumbers, the following described real property ("Land"): That certain real property located in the City of South San Francisco, County of San Mateo, State of California, described as Parcel "D-I" as shown on that certain map entitled "Parcel Map 89-262, South San Francisco, San Mateo County, California" filed in the Office of the Recorder of San Mateo County, State of California on May 23, 1989 in Book 62 of Parcel Maps at pages 25 and 26. APN 0i5-010-260; JPN 105-01-010- 7.03.01. GCS JMBMSF%30030 ! 56693 0030 02/17/95 The Land and all improvements now or hereafter located on the Land are hereinafter together referred to as the "Premises." Lender is making a loan directly to Lessee, as Borrower (the "Loan"). To secure the Loan, Lessee has agreed to assign the Lease to Lender. Both Lessors and Lessee acknowledge that they each will benefit from the Loan and that Lender would not make the Loan if it did not receive this assignment. 1. Assiqnment of Lease. In consideration of the Loan and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Lessee assigns to Lender all of Lessee's rights in the Lease, as partial security for the Loan. The parties intend that this Assignment will be a present transfer to Lender of all of Lessee's rights under the Lease, subject to Lessee's rights to use the Premises and to enjoy the benefits of the Lease while not in default on the Loan or Lease. This Assignment will take effect when received by Lender, without the necessity of any acceptance by Lender, in writing or otherwise, and will remain in full force and effect until the Loan is paid in full, including all renewals, extensions and modifications. This Assignment includes all future renewals of and amendments to the Lease. No amendments may be made to the Lease without Lender's prior written consent, which shall not be unreasonably withheld. 2. Consent of Lessors. Lessors hereby expressly consent to the Assignment of the Lease to Lender on the terms set forth in this Assignment. If Lessee defaults under the Loan or the Lease, Lender may reassign the Lease to a new lessee who thereupon shall assume all of Lessee's obligations under the Lease, and Lessors agrees that Lessors' consent to any such reassignment will not be unreasonably withheld. So long as Lender has not entered the Premises for the purpose of operating a business, Lender will have no liability under the Lease, including without limitation, liability for payment or rent or any other kind or type of liability. Whether or not Lender enters into possession of the Premises for any purpose, Lessee will remain fully liable for all obligations of Lessee as lessee under the Lease. While Lender is in possession of the Premises, Lender will cause all payments due under the Lease and attributable to that period of time to be made to Lessors. If Lender later reassigns the Lease or abandons the Premises, Lender will have not further obligation to Lessors. 3. Lease Defaults. Lessors agree not to declare an event of default or terminate the Lease without giving Lender written notice of any breach by Lessee and an opportunity to cure the breach within a period of not less than sixty (60) days from Lenders receipt of the notice. If Lessees breach is one that cannot reasonably be cured by Lender (such as insolvency, bankruptcy, or other judicial proceedings against Lessee), then Lessors will not terminate the Lease so long as Lessors receive GCS J~IB1%ISF~36030 I 56693 0030 02117195 2 all sums due under the Lease for the period during which Lender is in possession of the Premises or so long as Lender reassigns the Lease to a new lessee reasonably satisfactory to Lessors. 4. Personal Property. Lessors agree that all personal property on the Premises in which Lender has a security interest is severable and may be removed without further consent from Lessors in the event Lessee defaults under the Loan or the Lease. Any liens which Lessors may have against the personal property will be subordinate to all security interests of Lender in the personal property, if any. However, Lender will not remove any such property in such a way that the Premises are damaged without reimbursing Lessors for the cost of repair. 5. Additional Provisions. This Assignment shall extend to and bind the respective heirs, personal representatives, successors and assigns of the parties to this Assignment and all covenants of the Lessors and Lessee stated in this Assignment are enforceable by any transferee or endorsee to whom the Lender may have transferred this Assignment Lessors and Lessee each acknowledges it has read all of the provisions of this Assignment of Lease and Consent of Lessors, and each agrees to its terms. This Assigrnnent is dated LESSORS: SAN MATEO COUNTY HARBOR DISTRICT ATTEST: CITY OF SOUTH SAN FRANCISCO BY: Name/~.~ ] s on~~ Title: Cifj, Manager LESSEE: INN DEVELOPMENT, INC., a California corporation, By: Douglas S. Conover, president (Signature page continued) ocsmm~n3~3o~5~93~3om/~7/~ 3 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT No. State of ~,~z/ County of DATE personally appeared beforeme, ,/~R~'7/¢~z ~ ~/L~-$O/U~ , NAME, TITLE OF OFFICER - E.G., "JANE DOE, NOTARY PUBLIC" NAME(S)-~F SIGNER(S) ~(nown to me - OR - [] 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 ac- knowledged to me that he/she/they executed the same in his/her/their authorized capacity(les), 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, ,, -~ OFFICIAL SEAL ,, ~,. MARTHA M. BROWN-BUNES  "~ Notary Public-California -'~:~ :' ~'~' SAN MATEO COUNTY  My Commission Expires May 19, 1995 WITNESS my hand and official seal. OPTIONAL Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form. CAPACITY CLAIMED BY SIGNER [] INDIVIDUAL [] CORPORATE OFFICER TrrLE(S) [] PARTNER(S) [] LIMITED [] GENERAL [] ATTORNEY'IN-FACT [] TRUSTEE(S) [] GUARDIAN/CONSERVATOR [] OTHER: SIGNER IS REPRESENTING: NAME OF PERSON(S) OR ENTITY(lES) DESCRIPTION OF ATTACHED DOCUMENT TITLE OR TYPE OF DOCUMENT NUMBER OF PAGES DATE OF DOCUMENT ,~IU ,i~J~r~ ~adnT',_~ SIGNER(S) OTHER THAN NAMED ABOVE ¢31993 NATIONAL NOTARY ASSOCIATION · 8236 Remmet Ave., P.O. Box 7184 · Canoga Park, CA 91309-7184 LENDER: COMMERCIAL BANK OF FREMONT, a California banking association, By: William L. Stone, Sr. Vice President GCS J]VIBNISF%36030 1 56693 0030 02117195 ACKNOWLEDGEMENTS State of California County of SS On , 1995, before me, , personally appeared , personally known to me (or 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 (Seal) State of California County of SS On , 1995, before me, , personally appeared , personally known to me (or 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 (Seal) GCS JMBMSF%36030 ! 56693 0030 02117195 - 5 - State of California County of ss On , 1995, before me, , personally appeared , personally known to me (or 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 (Seal) State of California County of SS On , 1995, before me, , personally appeared , personally known to me (or 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 (Seal) GCS JIVIBNISF%36030 1 56693 0030 02117195 - 6 -