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HomeMy WebLinkAboutRES NO 05-8812228'~ COUNCIL RESOLUTION NO. 5-88 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BAKERSFIELD APPROVING AND AUTHORIZING THE EXECUTION OF A FIRST IMPLEMENTATION AGREEMENT TO THE DISPOSITION AND DEVELOP- MENT AGREEMENT BETWEEN THE CENTRAL DIS- TRICT DEVELOPMENT AGENCY OF THE CITY OF BAKERSFIELD AND BAKERSFIELD CONVENTION CENTER HOTEL ASSOCIATES, LTD. WHEREAS, pursuant to the California Community Rede- velopment Law (Health and Safety Code Section 33000 e__~t ~eq.), the Central District Development Agency of the City of Bakersfield (the "Agency") is carrying out the Redevelopment Plan (the "Redevelopment Plan") for the Downtown Bakersfield Redevelopment Project (the "Project"); and WHEREAS, the Agency and Bakersfield Convention Center Hotel Associates, Ltd. (the "Developer") entered into a Disposition and Development Agreement (the "DDA"), dated September 24, 1986, pursuant to which the Agency agreed to lease to Developer and Developer agreed to lease from the Agency and develop certain real property with a hotel (the "Hotel Parcel") and pursuant to which the Agency agreed to sublease to Developer and Developer agreed to sublease from the Agency and develop certain other real property with public improvements (the "Public Improvements Parcel") located within the boundaries of the Project; and WHEREAS, the Agency and the Developer now desire to make certain technical modifications and additions to the DDA in light of current conditions pursuant to a First Imple- mentation Agreement to the Disposition and Development Agreement (the "Agreement"); and WHEREAS, such modifications and additions do not sub- stantially change the provisions of the DDA; and WHEREAS, the City Council approved and authorized the execution by the Agency of the DDA; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BAKERSFIELD DOES HEREBY RESOLVE AS FOLLOWS: Section 1. The City Council hereby approves and authorizes execution by the Agency of the First Implementation Agreement to the Disposition and Development Agreement attached hereto as Exhibit A and incorporated herein by reference. I HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the Council of the City of Bakersfield at a regular meeting thereof held on 20th day of January by the following roll call vote: AYES: COUNC[LM[M[~ERS CHILDf UuMON'3. ,GF,,llIH, [{ATTY FETEF~SON, ,%IcD~qM,~T $;~LVAGGIO NOES: COUNCILME,,;OESS None ABSENT. COUNC~LMEM~L!IS None ABSTAINING: COUNCILMEMBERS N~1'1¢ , 1988, CITY CLERK and Ex Officio Clerk of the Council of the City of Bakersfield APPROVED January 20, 1988 MAYOR of the City of B~kersfield FIRST IMPLEMENTATION AGREEMENT TO AMENDED AND RESTATED DISPOSITION AND DEVELOPMENT AGREEMENT THIS FIRST IMPLEMENTATION AGREEMENT (the "Agreement") is entered into this day of __ , 1988, by and between the CENTRAL DISTRICT DEVELOPMENT AGENCY OF THE CITY OF BAKERSFIELD, a public body, corporate and politic (the "Agency") and BAKERSFIELD CONVENTION CENTER HOTEL ASSOCIATES, LTD., a Colorado general partnership ("Developer"). Recitals A. The Agency, as the Bakersfield Redevelopment Agency, and the Director have heretofore entered into an Amended and Restated Disposition and Development Agreement (the "DDA"), dated September 24, 1986, for the lease of certain real property (the 'Hotel Parcel") for the development of a hotel (the 'Hotel") thereon and the sublease of certain other real property (the 'Public Improvements Parcel") for the development of a ballroom and meeting rooms (collectively, the 'Public Improvements") thereon. B. The Developer has obtained separate financing for the construction of the Hotel and the Public Improvements. Developer has obtained a construction loan for the Hotel from Mercury Savings and Loan Association ("Mercury") and a construction loan for the Public Improvements (the "Public Improvements Loan") in the amount of TWO MILLION DOLLARS ($2,000,000) from American National Bank. C. As required by the loan agreement with Mercury (the "Loan Agreement'), the proceeds of the Public Improvements Loan have been deposited with Mercury (the "Public Improvements Account") and are to be disbursed by Mercury to Developer to pay for construction of the Public Improvements. D. Pursuant to the DDA, the Agency entered into an agreement to repay the Developer for the cost of constructing the Public Improvements (the "Purchase Agreement") up to a principal amount of TWO MILLION DOLLARS ($2,000,000) plus interest. E. To assist Developer in obtaining the Public Improvements Loan from American National Bank, Agency agreed to allow Developer to assign its rights under the Purchase Agreement to American National Bank. As a further inducement to American National Bank to make the Public Improvements Loan, the Agency agreed that the Agency's obligation to make the payments under the Purchase Agreement would not be offset by any default of Developer under any other agreement between the Developer and Agency. F. Developer has assigned its rights under the Purchase Agreement to American National Bank. G. At the time the DDA was executed, the parties anticipated that construction of the Public Improvements would commence shortly after the Public Improvements Account was established and the site was conveyed to Developer, in accordance with the time set forth in the DDA. Although it has been more than nine (9) months since the site was conveyed to Developer and the Public Improvements Account was established, construction of the Public Improvements has not commenced. In addition, the Agency has begun making its payments under the Purchase Agreement. H. In light of current conditions and the further planning and decisions of the parties, the Agency and the Developer now desire to clarify how the money in the Public Improvements Account should be disbursed in the event it or any portion thereof is not used for the construction of the Public Improvements. -2- Aqreements NOW, THEREFORE, THE AGENCY AND DEVELOPER AGREE AS FOLLOWS: Section 1. The purpose of this Agreement is to implement the DDA by making certain modifications thereto in light of current conditions and the further planning and decisions of the parties. The parties hereby agree that all the monies in the Public Improvements Account shall be used first to pay for the construction of the Public Improvements, and if not so used, to offset the Agency's obligations under the Purchase Agreement. Section 2. A new Section 324 of the DDA is hereby added to read as follows: "H. [§324] Public Improvements Loan "The Developer has obtained financing for the construction of the Public Improvements (the "Public Improvements Loan") in the principal amount of TWO MILLION DOLLARS ($2,000,000) from American National Bank. The proceeds of the Public Improvements Loan have been deposited with Mercury Savings and Loan Association (the "Public Improvements Account") and will be disbursed by Mercury to Developer to pay for the construction of the Public Improvements. The Public Improvements Account is being held by Mercury either in a money market savings account or is bearing interest as though in a money market savings account. "In the event the Public Improvements Account or any portion thereof is not used to pay for the construction of the Public Improvements, the parties hereto agree as follows: "1. Developer agrees that it shall promptly use its best efforts to cause Mercury to disburse any and all interest which has accrued in the Public Improvements Account to the Agency as soon as possible. If Developer is able to cause interest to be disbursed by -3- Mercury to the Agency, such disbursements shall be made semi-annually on February 15 and August 15 of each year the Public Improvements Account is maintained and is earning interest and so long as construction of the Public Improvements has not commenced. After construction of the Public Improvements has commenced, any interest earned in the Public Improvements Account shall remain therein. Agency intends to use any interest payments it receives to offset the Agency's obligations to pay under the Purchase Agreement (Attachment No. 7). "2. In the event the DDA is terminated and construction of the Public Improvements has not commenced (as evidenced by no disbursements having been made by Mercury to Developer from the Public Improvements Account), Developer hereby agrees that the Agency is entitled to receive all the monies in the Public Improvements Account, including any accrued interest. In such event, Developer hereby authorizes Mercury to pay directly to the Agency all monies in the Public Improvements Account. Developer further agrees to execute any documents deemed necessary by either Mercury or the Agency to effectuate such a disbursement to the Agency. "3. In the event the DDA is terminated and construction of the Public Improvements has commenced (as evidenced by a disbursement having been made by Mercury to Developer from the Public Improvements Account), Developer agrees that, as between Developer and Agency, Agency shall be entitled to receive any and all monies from the Public Improvements Account, including any accrued interest. Developer hereby authorizes Mercury to pay directly to the Agency all monies in the Public Improvements Account which Mercury otherwise would pay to Developer in such event. Developer further agrees to execute any documents deemed necessary by either Mercury or the Agency to effectuate such a disbursement to the Agency. -4- '4. The parties agree that the Agency is entitled to receive any monies remaining in the Public Improvements Account, including any accrued interest, upon completion of the Public Improvements. Developer hereby authorizes Mercury to disburse such remaining funds directly to the Agency when the Public Improvements have been completed and Mercury is satisfied that the funds will not be needed for construction of the Public Improvements. Developer agrees that it shall execute any documents deemed necessary by either Mercury or the Agency to effectuate such a disbursement to the Agency. '5. Nothing in this Section 324 is intended to modify, restrict or abridge the rights of Mercury under the loan agreement for financing the construction of the improvements on the Hotel Parcel or any other documents which have been executed by Developer and required by Mercury in connection with such loan agreement." Section 3. Promptly upon execution by the parties, the Agency shall send an executed copy of this Agreement to Mercury by registered mail, return receipt requested, to the following address: Mercury Savings & Loan Association 7812 Edlinger Avenue Huntington Beach, CA 92647 Attn: William Morris, Executive Vice-President Copy to: Jerome Zamos, Executive Vice-President Section 4. Except as modified and amended in this Agreement, all other provisions of the DDA shall remain in full force and effect. Section 5. This Agreement is entered into as of the day and year first above written, which is the date of approval for execution by the Agency. IN WITNESS WHEREOF the parties hereto have caused this Agreement to be executed and attested by their proper -5- officers thereunto duly authorized as of the day and year first above written. CENTRAL DISTRICT DEVELOPMENT AGENCY OF THE CITY OF BAKERSFIELD Approved as to form: By Executive Director of the Central District Development Agency of the City of Bakersfield By General Counsel Countersigned: By Secretary "AGENCY" BAKERSFIELD CONVENTION CENTER HOTEL ASSOCIATES, a Colorado general partnership, AIRCOA EQUITY INTERESTS, INC., a Colorado general partnership, General Partner By By -AND- -6- BAKERSFIELD HERITAGE HOTEL ASSOCIATES, LTD., a California limited partnership, General Partner By: BAKERSFIELD METROPOLITAN ASSOCIATES, INC., a California corporation, General Partner By 'DEVELOPER" -7- ACKNOWLEDGEMENTS Attach Acknowledgements Of Notaries Public