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HomeMy WebLinkAboutR42-Economic Development Agency ECONOMIC DEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO FROM: Gary Van Osdel Executive Director OR 1 G 1 NAtJECf: 303 W. THIRD STREET - AMENDMENT TO HUD SECTION 108 LOAN AGREEMENT, OWNER PARTICIPATION AGREEMENT, EDl LOAN AGREEMENT 303 LLC DATE: August10,2004 SYnonsls of Previous Commlssloo/CouncWCommlttee Actlon(s): On August 7, 2000, the Mayor aod Common Council and the Community Development Connnission authorized approva1 for Loan Guarantee Assistance under Section 108 of the Housing and Community Development Act of 1974 for the 303 West Third Street Project and approved an Owner Participation Agreement WIth 303, LLC to acquire and renovate the building. On December 12, 2000, the Council and Connnission took action to approve the final form of the HUD I 08 loan agreement with HUD and the development agreements with 303, LLC On July 21, 2003, the Mayor and Common Council authorized execution of an Amended Conunitrnent Schedule for the 303 West Third Street HUD I 08 loan between the City of San Bernardino and the US Department of Housing aod Urban Development (HUD). On July 24, 2003, Redevelopment Conunittee voted nnanirnolJSly to recommend that the Community Development Connmssion and Common COuncil approve an amendment to the Owner Participation and ED! Loan Agreement with the 303 LLC. On August 4, 2003, the Community Development Conunission approved an amendment to the 2000 Owner Participation And ED! Loan Agreement dated September 18, 2000, by and between the Agency and the 303 LLC. On August 4, 2003, the Mayor and Common Council approved an amendment to the 2000 CDBG Program Section 108 Project Development Loan Agreement dated September 18, 2000 by and between the City aod the 303 LLC. On July 6, 2004, the Redevelopment Conunittee considered the need to further modifY the HUD Section 108 Loan Agreement and related agreements with the 303 LLC and recommended that the matter be placed on the agenda for July 19, 2004, for consideration by the Mayor and Common Council aod Community Development Connnission. Recommended Motion(s): LM~ and Common Council} MOTION A: A RESOLUTION OF THE MAYOR. COMMON COUNCIL APPROVING THE AUGUST 2004 MEMORANDUM OF AMENDMENT TO THE SECfION 108 LOAN GUARANTEE AGREEMENT BY AND BETWEEN THE UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD) AND THE CITY OF SAN BERNARDINO (303 LLC PROJECf). MOTION B: A RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO APPROVING THE AUGUST 2004 AMENDMENT TO THE 2000 COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM SECfION 108 PROJECf DEVELOPMENT LOAN AGREEMENT, DATED SEPTEMBER 18, 2000, BY AND BETWEEN 303, LLC, AND THE CITY OF SAN BERNARDINO. (Community Develollment Commission) MOTION C: A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING THE AUGUST 2004 AMENDMENT TO THE 2000 OWNER PARTICIPATION AND ED! LOAN AGREEMENT AND ED! LOAN FORBEARANCE AGREEMENT, DATED SEPTEMBER 18,2000, BY AND BETWEEN THE 303 LLC AND THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO. Contact Person(s): Project Area(s) Gary Van OsdeVMaggie Pacheco Central City Phone: (909) 663-1044 I Ward(s): Supporting Data Attached: It'! Staff Report It'! Resolution(s) It'! Agreement(s)/Contract(s) 0 Map(s) 0 Letters See fIscal FUNDING REQUIREMENTS Mount: $ impact Source: N/A SIGNATURE: N/A Commlssloo/Council Notes: P:\Aaendas\Coom Dcv Cornmiuioa\COC 2004\04-08-16 303 W 3rd St coc SR.doc ~.l.I- Z-<:J:A - U, 1 ~c<A- zr.a COMMISSION MEETING AGENDA Meeting Date: 0811612004 Agenda Item Number: ~ ECONOMIC DEVELOPMENT AGENCY STAFF REPORT 303 W. 3rd Street - Amendment to Section BUD 108 Loan Aereement and related documents. Owner Particination and EDI Loan Aereement with 303 LLC BACKGROUND: A year ago, the Common Council and the Commission were asked to approve amendments to the HUD 108 Loan Agreement and related agreements with the 303 LLC (the "Developer''). It was acknowledged at such time that efforts to attract a private user for the 303 W. 3rd Street building (the "Property") had failed, that negotiations between the County of San Bernardino ("County") and the Developer were proceeding and most likely staff would be back in a year requesting that the Council and Commission consider a second set of amendments that would provide additional deferral to the Developer's obligations to the City/Agency to coincide with the construction schedule ultimately agreed to by the County and the Developer. On June 29, 2004, the County Board of Supervisors approved a purchase and sale agreement with the Developer whereby the Developer will construct the essential core improvements and certain tenant improvements required by the County. Upon completion of such improvements the Developer will sell the Property to the County to accommodate, in part, the courtroom needs of the Superior Court. Prior to this time, the Developer was prevented from proceeding with the renovation of the Property until negotiations were completed and the County was able to specify the needed tenant improvements and to decide whether to lease or purchase the Property. CURRENT ISSUE: As a consequence of the delays in negotiations with the County, the Developer now needs to update or revise the schedule of performance under the City and Agency Agreements relating to the HUD Section 108 Loan and related agreements, as amended. In order to enable sufficient time for the Developer to obtain senior construction financing now estimated not to exceed ($15,000,000), to initiate construction of the necessary improvements for the County and the needs of the Superior Court, and, to give the Developer sufficient time to satisfactorily complete the required improvements (estimated at 425 calendar days from commencement) and to consummate the sale of the Property to the County, it is necessary to amend various documents between: (i) the City and HUD, (ii) the City and Developer, and (iii) the Agency and Developer. These changes would include the following items: deferral of the due date to the Agency of the Developer's EDI Loan payment ($344,000), the "Participation" fee ($200,000); the Tax Increment in-lieu Payment ($250,000) and deferral of two (2) $100,000 principal payments due to HUD on the Section 108 Loan. The original Section 108 Loan Agreements between the City and HUD and between the City and the Developer contemplated that the Section 108 loan would be subordinated to a senior construction loan for core improvements only of approximately $8.5 Million. Now, pursuant to the transaction as agreed to by the County and the Developer, the construction costs have increased approximately $15 COMMISSION MEETING AGENDA Meeting Date: 0811612004 Agenda Item Number: K <f J- p:\Apldu\Comm I)cv CommiMion\COC 2004\04-08-16 303 W 3rd St COC SRdoc Economic Development Agency Staff Report 303 West Third Street - Amendment to Owner Participation and ED! Loan Agreement Page 2 Million. For this reason, the subordination provision of the various agreements will also need to be amended to allow for the subordination to senior construction financing for core and additional tenant improvements required by the County in the amount not to exceed $15 Million. At the request of Agency staff, Agency consultant Scott Rodde engaged HUD stafflWashington D.C. in informal discussions regarding both the subordination and the Section 108 loan payment deferral issues and was given a favorable response. HUD is now awaiting the formal written request of the City and the Agency along with the accompanying submittals. To accomplish the above actions, Agency Special Counsel has prepared the following loan and development agreement amendments: 1. August 2004 Memorandum of Amendment to the HUD Section 108 Loan Guarantee Agreement between HUD and the City. . authorizes the subordination of the HUD Section 108 Loan to a construction loan not to exceed $15 million and defers the principal payments due on August 1,2005 and August 1,2006 (each payment is $100,000) to final maturity date of HUD Section 108 Loan. 2. A 2004 Amendment to the 2000 Community Development Block Grant Program Section 108 Project Development Loan Agreement between the Developer and the City. . approves the subordination of the Section 108 Loan to a construction loan not to exceed $15 million. . defers the Developer's repayment of August I, 2005, $100,000, and August 1,2006, $100,000 to the final maturity date of the HUD Section 108 Loan or the close of the escrow between the County and Developer, whichever occurs first. . authorizes the City to withdraw the sum of $100,000 from the Funded Interest Reserve Fund to pay the $100,000 principal installment due to HUD on August 1,2004; and any amounts sufficient to bring all interest payments due from the Developer to City. . acknowledgment that the Developer has substituted one of its former managing members, J. Kevin Brunk, for another managing member, cn, Inc., a California Corporation. . consents to the County Property Purchase Contract. . authorizes Developer to obtain a Mezzanine Loan estimated at $800,000 (to be used by the Developer to prepare all necessary architectural and engineering plans required to fulfill its obligations pursuant to the County Property Purchase Contract), secured by the Property, but junior to Agency loans. 3. A 2004 Amendment to the 2000 Owner Participation Agreement between the Agency and the Developer. . defers payment of the monies owed the Agency by the Developer i.e. the $344,000 ED! Loan, the $200,000 Participation Fee and the $250,000 tax increment in-lieu payment until August I, 2006 or the close of escrow between the County and Developer, whichever occurs first. ENVIRONMENTAL IMPACT: None. P:\ApIdaI\Comm Dev Conwniuilm\COC 2004\04-08-16 303 W 3rd St CDC SR.doe COMMISSION MEETING AGENDA Meeting Date: 08116/2004 Agenda Item Number: '-1fJ- Economic Development Agency Staff Report 303 West Third Street - Amendment to Owner Participation and ED! Loan Agreement Page 3 FISCAL IMPACT: Because of the delays in the County/Developer negotiations, thus, resulting in the delay of bringing the proposed amendments fOIWard for Council/Commission for consideration, the Agency remitted the August I, 2004 Section 108 loan payment to HUD in the amount of $100,000 plus interest of $7,451.97 and has subsequently been reimbursed by the Developer out of the funded interest reserve fund established under City Section 108 Loan Agreement with the Developer. Deferral to the new date of August 1, 2006 of the Developer's payment of $794,000 to the Agency for the ED! Loan, the Participation Fee and the Tax Increment In-lieu Payment is necessary to effectuate the County Property Purchase Contract as negotiated between the County and Developer. Pursuant to the Owner Participation and ED! Loan Agreement, as amended in 2003, payment of those obligations by the Developer is predicated upon permanent financing being obtained. RECOMMENDATION: That the Community Development Commission and the Mayor and Common Council adopt the attached Resolutions. COMMISSION MEETING AGENDA Meeting Date: 08/16/2004 Agenda Item Number: fl.'!:;. P:\Ajendu\Com1'l Dcv CornmistioR\CDC 2004\04-08-16 303 W 3rd 5t coe SR.doc 0 2 3 4 5 6 7 8 9 10 13 0 14 15 16 17 18 19 20 21 22 10 I I I RESOLUTION N~ A RESOLUTION OF THE MAYOR A9JEJt COUNCIL APPROVING THE AUGUST 2004 MEMORANDUM OF AMENDMENT TO THE HUD SECTION 108 LOAN GUARANTEE AGREEMENT BY AND BETWEEN THE UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD) AND THE CITY OF SAN BERNARDINO (303 LLC PROJECT) II WHEREAS, 303, L.L.c., a California limited liability company (the "Borrower") and the City of San Bernardino (the "City") have previously entered into that certain loan agreement entitled "2000 Community Development Block Grant Program Section 108 Project Development Loan Agreement". dated as of September 18, 2000. as amended (the "Agreement"); and WHEREAS. the City has previously disbursed to the Borrower the sum of One Million Six Hundred Four Thousand Seventy Four Dollars and Six Cents Dollars ($1,604,074.06), exclusive of funded interest under the terms of the Agreement for the acquisition of the "303 Third Street Parcel" and for the construction and installation of the "Borrower Improvements (Phase I)", as these temlS are defined in the Agreement; and WHEREAS, on July 21. 2003, the Mayor and Common Council authorized the City to amend the Commitment Schedule to defer the original principal payment of $100,000 due on August I, 2003 to August I, 2004 and authorized a corresponding Amended Commitment Schedule for Note No. B-99-MC-36-0003-B in the amount of $1,840,000; 12 7- -, WHEREAS, on August 4. 2003. the Community Development Commission of the City of San Bernardino approved an Amendment to the 2000 Owner Participation and ED! Loan Agreement by and between the Owner and the Agency to defer the repayment of the scheduled HUD Section Loan in accordance with the terms of the 2003 City Section 108 Loan Agreement; and 24 WHEREAS, the Owner has negotiated a purchase and sale agreement with the County of San Bernardino ('County") for improvement and sale of the 303 Third Street Parcel for which the County will acquire the 303 Third Street Parcel ("Sale") upon completion of certain 25 -1- 1':\cunG UCllII,M;I1;!ti,.\Il,'"fl Oon\~n704 !\'Ice ResohlliOu )0) LLC - Molioll A.llt..- () 3 4 5 6 7 8 9 10 11 12 13 () 14 15 10 I I I tenant improvements ("tenant Improvements") by the Owner in order to accommodate the 2 relocation of the Superior Court of California; and WHEREAS, in order to facilitate the Owner and County Sale, the Ovmer has requested that the Agency take certain actions to enable the Agency and the City to subordinate its HUD Section 108 Loan in the approximate amount of $1.8 million to a Senior Construction Loan in the approximate amount of $15 million of which the Owner will use a portion of said Senior Construction Loan to accomplish the Tenant Improvements to the 303 Third Street Parcel and furthermore the Owner has requested that the Agency and City consider deferring the Section 108 Loan repayment due date of August 1. 2005 and August I, 2006; and WHEREAS, in order to accomplish the construction of the Tenant Improvements and facilitate the Sale to the County, the City finds it appropriate and necessary to amend those certain agreements as provided for in the August 2004 Memorandum of Amendment to the Section 108 Loan Guarantee Agreement by and between the United States Department of Housing and Urban Development (HUD) and the City of San Bernardino (303 LLC Project). 16 NOW, THEREFORE, IT IS HEREBY RESOLVED, DETERMINED AND ORDERED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO, AS FOLLOWS: 17 Section 1. The Mayor and Common Council hereby approves the form of the 18 August 2004 Memorandum of Amendment to the Section 108 Loan Guarantee Agreement by and between the United States Department of Housing and Urban Development and the City of 19 San Bernardino (303 LLC Project), dated as of August 16, 2004 (the "2004 Section 108 Loan 20 Agreement Amendment") in the form attached hereto as Exhibit "A". The Mayor, City Clerk 21 and the Executive Director of the Economic Development Agency are hereby authorized and 22 directed to execute the 2004 Section 108 Loan Agreement Amendment on behalf of the City 23 together with such technical and conforming changes as may be approved by the Mayor upon 24 the recommendation of special legal cOllnsel to the City and the Executive Director of the 25 Economic Development Agency. -2- P:\CDBG Delll\l\bggieIDurt 00(!\711704 :vice ResOlution JOJ LLC. Motion A.doc take effect upon its adoption and execution in the Section 2. This Resolution shall 0 2 manner as required by the City Charter. 3 III 4 III 5 III 6 III 7 III 8 III III 9 III 10 III 11 III 12 III 13 0 III 14 III 15 III 16 III 17 III 18 III 19 III 20 III 21 III 22 III 23 24 25 0 -3- P;\CDBG DfI)I\M~ggie\Drarl Oocs\7070ol MCC Resolution 303 LLC - Motion A.uoe 0 2 3 4 5 6 7 8 9 10 11 12 13 0 14 15 o A RESOLUTION OF THE MAYOR AND COMMON COUNCIL APPROVING THE AUGUST 2004 MEMORANDUM OF AMENDMENT TO THE HUD SECTION 108 LOAN GUARANTEE AGREEMENT BY AND BETWEEN THE UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD) AND THE CITY OF SAN BERNARDINO (303 LLC PROJECT) I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and Common Council of the City of San Bernardino at a meeting thereof, held on the day of , 2004, by the following vote to wit: Council Members: Ayes Nays Abstain Absent ESTRADA LONGVILLE MCGINNIS DERRY KELLEY JOHNSON MC CAMMACK Rachel G. Clark, City Clerk 16 17 The foregoing resolution is hereby approved this day of ,2004. 18 19 20 Judith Valles, Mayor City of San Bernardino Approved as to form and Legal Content: 21 22 By: 23 24 25 S':c~ .4. P:\COBG Otlll\i\bg.!fieIDr:.f1 Du(s\7U7tl~ MCC Resolutioll )tlJ l.LC - MOliull A.due 0 2 3 4 5 6 7 8 9 10 13 0 ]4 15 16 17 18 19 20 21 22 23 24 o RESOLUTION NOOO A RESOLUTION OF THE MAYOR AND cOM!2;,IE~ OF TlIE CITY OF SAN BERNARDINO APPROVING THE AUGUST 2004 AMENDMENT TO THE 2000 COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM SECTION 108 PROJECT DEVELOPMENT LOAN AGREEMENT, DATED SEPTEMBER 18,2000, BY AND BETWEEN 303, L.L.c., AND THE CITY OF SAN BERNARDINO II WHEREAS, 303, L.L.c., a California limited liability company (the "Borrower") and the City of San Bernardino (the "City") have previously entered into that certain loan agreement entitled "2000 Community Development Block Grant Program Section 108 Project Development Loan Agreement", dated as of September 18, 2000, as amended on August 4, 2003 (the "Agreement"); and WHEREAS, the City has previously disbursed to the Borrower the sum of One Million Six Hundred Four Thousand Seventy Four Dollars and Six Cents Dollars ($1,604,074.06), exclusive of funded interest under the terms of the Agreement for the acquisition of the "303 Third Street Parcel" and for the construction and installation of the "Borrower Improvements (Phase I)", as these telms are defined in the Agreement; and WHEREAS, on August 4, 2003, the Community Development Commission of the City 12 of San Bernardino approved an Amendment to the 2000 Owner Participation and ED! Loan Agreement, by and between the Owner and the Agency to defer the repayment of the scheduled HUD Section 108 Loan in accordance with the terms of the 2003 City Section 108 Loan Agreement and subsequent amendments thereto; and WHEREAS, the Owner has negotiated a purchase and sale agreement with the County of San Bernardino ("County") for improvement and sale of the 303 Third Street Parcel for which the County will acquire the 303 Third Street Parcel ("Sale") upon completion of certain tenant improvements ("Tenant Improvements") by the Owner in order to accommodate the relocation of the Superior Court of California; and 25 WHEREAS, in order to facilitate the Owner and County Sale. the Owner has requested -1- 1':\CD8G Dtlll\,\hggieIDnrl OocsI04-117-l'J JOJ W Thinl 51 MCC Rc,,, vcr MP.doc () 2 3 4 5 6 7 o o that the Agency take certain actions to enable the Agency and the City to subordinate its HUD Section 108 Loan in the amount of $1.8 to a Senior Construction Loan in the approximate amount of $15 million of which the Owner will use a portion of said Senior Construction Loan to accomplish certain Tenant Improvements to the 303 Third Street Parcel and furthermore the Owner has requested that the Agency and City consider deferring the Section 108 Loan repayment due date of August 1,2005 and August 1, 2006; and WHEREAS, the Owner and the Agency believe it is appropriate and necessary to amend 8 the Agreement as set forth in the August 2004 Amendment of the 2000 Community Development Block Grant Program Section 108 Project Development Loan Agreement 9 10 ("August 2004 Amendment"). 11 NOW, THEREFORE, IT IS HEREBY RESOLVED, DETERMINED AND ORDERED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO, AS FOLLOWS: 12 13 The Mayor and Common Council hereby approves the form of the Section I. 14 August 2004 Amendment and Loan Forbearance Agreement (303 Third Street Project), dated as of August 16, 2004 by and between the Borrower and the City in the form attached hereto as Exhibit "A". The Mayor, City Clerk and the Executive Director of the Economic Development Agency are hereby authorized and directed to execute the August 2004 Amendment on behalf 15 16 17 18 of the City together with such technical and conforming changes as may be approved by the Mayor upon the recommendation of special legal counsel to the City and the Executive Director of the Economic Development Agency. Section 2. This Resolution shall take effect upon its adoption and execution in the 19 20 21 22 manner as required by the City Charter. 7' -, 1/1 24 1/1 25 1/1 -2- P:\CDOG [)ellll!\'l3~gie"D,'''Ct 00(1104-07.1'1 30) W Third 51 .'\IICe RfSO ~tr MP,dlIc () o o 2 A RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO APPROVING THE AUGUST 2004 AMENDMENT TO THE 2000 COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM SECTION 108 PROJECT DEVELOPMENT LOAN AGREEMENT, DATED SEPTEMBER 18, 2000, BY AND BETWEEN 303, L.L.C., AND THE CITY OF SAN BERNARDINO 3 4 5 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and 6 7 Common Council of the City of San Bernardino at a meeting thereof, held on the 8 day of , 2004, by the following vote to wit: 9 Council Members: Aves Navs Abstain Absent 10 ESTRADA LONGVILLE MCGINNIS DERRY KELLEY JOHNSON II 12 13 14 15 MC CAMMACK 16 Rachel G. Clark, City Clerk 17 18 day of ,2004. The foregoing resolution is hereby approved this 19 20 21 Judith Valles, Mayor City of San Bernardino 22 Approved as to form and Legal Content: 23 Sp~ 24 By: 25 1':\C08(; Dtll1\i\h~l!:jt\Or~fl D"o"O~-U7.19 303 W Third 51 :\<Ice RUfl vcr MP.dll( () 2 3 4 5 6 7 8 9 10 11 12 13 0 14 o RESOLUTlONNC ~ rPY A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING THE AUGUST 2004 AMENDMENT TO THE 2000 OWNER PARTICIPATION AND EDI LOAN AGREEMENT AND EDI LOAN FORBEARANCE AGREEMENT, DATED SEPTEMBER 18, 2000, BY AND BETWEEN 303 L.L.C., AND THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO 15 WHEREAS, 303, L.L.c., a California limited liability company (the "Owner") and the Redevelopment Agency of the City of San Bernardino (the "Agency") have previously entered into that certain agreement entitled "2000 Owner Participation and ED! Loan Agreement," dated as of September 18, 2000. (the "Agreement") and concurrently therewith the Owner entered into a separate agreement with the City of San Bernardino entitled "2000 Community Development Block Grant Program Section 108 Project Development Loan Agreement," dated September 18,2000, amended (the "City Section 108 Loan Agreement"), pursuant to which the Owner completed its acquisition of the "303 Third Street Parcel", as this term is defined in the Agreement; and 16 WHEREAS, the Agency has previously disbursed the sum of Three Hundred Forty Four 17 Thousand Dollars ($344.000) to the Owner for the acquisition of the 303 Third Street Parcel as 18 provided under the Agreement; and \9 WHEREAS. on August 4. 2003. the Community Development Commission of the City of San Bernardino approved an Amendment to the 2000 Owner Participation and ED! Loan 20 2\ Agreement, by and between the Owner and the Agency to defer the repayment of the scheduled 22 HUD Section 108 Loan in accordance with the terms of the 2003 City Section 108 Loan 23 Agreement; and WHEREAS, the Owner has negotiated a purchase and sale agreement with the 24 25 County of San Bernardino ("County") for improvement and sale of the 303 Third Street Parcel for which the County will acquire the 303 Third Street Parcel ("Sale") upon completion of -1- 1':\CDIlG IlCII11;\hgg,eIDr;,rlllouI04-U7.I'I.llll W Thinl SI eoc RUll V\.'- .\ll'.du( o o o certain tenant improvements CTenant Improvements") by the Owner in order to accommodate 2 the relocation of the Superior Court of California; and. 3 WHEREAS, in order to facilitate the Owner and County Sale, the Owner has requested 4 that the Agency take certain actions to enable the Agency and the City to subordinate its HUD 5 Section 108 Loan in the amount of $I.ll to a Senior Construction Loan in the approximate 6 amount of $ I 5 million of which the Owner will use a portion of said Senior Construction Loan 7 to accomplish the Tenant Improvements to the 303 Third Street Parcel and furthermore the 8 Owner has requested that the Agency and City consider deferring the Section 108 Loan 9 repayment due date of August I, 2005 and August I, 2006; and 10 WHEREAS, the Owner and the Agency believe it is appropriate and necessary to amend the II Agreement as set forth in the August 2004 Amendment to the 2000 Owner Participation and 12 ED! Loan Agreement and ED! Loan Forbearance Agreement ("2004 Owner/Agency 13 Amendment"). NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION OF THE 15 CITY OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER, AS 14 16 FOLLOWS: 17 Section I. The Commission hereby approves the 2004 Owner/Agency Amendment 18 dated as of August 16,2004 by and between the Owner and the Agency in the form attached as 19 Exhibit "A". The Chair of the Commission and the Agency Secretary are hereby authorized and 20 directed to execute the 2004 Owner/Agency Amendment on behalf of the Agency, together with such technical and conforming changes as may be recommended by the Executive Director of the Agency in consultation with Agency special legal counsel. 21 22 Section 2. The Resolution shall become effective immediately upon its adoption. 0' .J /11 24 25 -2- P,'.CDBG Dellt\!\1al;li~\Drarl Doc~\1l4-n7.19 Jill W Thi,'d 51 CDC R~o ~tr MP.dtlc () o o 2 A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING THE AUGUST 2004 AMENDMENT TO THE 2000 OWNER PARTICIPATION AND EDI LOAN AGREEMENT AND EDI LOAN FORBEARANCE AGREEMENT, DATED SEPTEMBER 18, 2000, BY AND BETWEEN 303 L.L.C., AND THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO 3 4 5 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the 6 Community Development Commission of the City of San Bernardino at a meeting 7 day of , 2004, by the following vote to wit: thereof, held on the 8 Abstain Absent Navs Commission Members: Aves 9 ESTRADA LONGVILLE MCGINNIS DERRY KELLEY JOHNSON MC CAMMACK 10 11 12 13 14 15 16 17 Secretary 18 19 The foregoing resolution is hereby approved this day of ,2004. 20 21 Judith Valles, Chairperson Community Development Commission of the City of San Bernardino 22 7' ~J Approved as to form and Legal Content: 24 cP~~ Agency..cou el Sf'rc"A I 25 By: -3~ P,\(;OBG D~IIIWlau.ie\Drart Doc~\04-07-1? 30] W Third SI CDC Rao ver MP.do( o o o AUGUST 2004 AMENDMENT TO 2000 OWNER PARTICIPATION AND ED! LOAN AGREEMENT AND ED! LOAN FORBEARANCE AGREEMENT (303 Third Street Project) THIS AUGUST 2004 AMENDMENT TO 2000 Owner Participation and ED! Loan Agreement (the "2004 Amendment") is dated as of August 16, 2004, by and between 303, L.L.C., a California limited liability company (the "Owner") and the Redevelopment Agency of the City of San Bernardino, a public body corporate and politic (the "Agency") and is entered into in light of the following facts: - - RECITALS -- The Owner and the Agency have previously entered into that certain agreement entitled "2000 Owner Participation and ED! Loan Agreement," dated as of September 18, 2000, as amended by an instrument entitled "Amendment to 2000 Owner Participation and ED! Loan Agreement and ED! Loan Forbearance Agreement," dated as of July I, 2003, (collectively referred to herein as the" Agreement") and the Owner has entered into a separate agreement with the City of San Bernardino entitled "2000 Community Development Block Grant Program Section 108 Project Development Loan Agreement," dated September 18, 2000, as amended ("City Section 108 Loan Agreement"), pursuant to which the Owner: (i) completed its acquisition of the "303 Third Street Parcel", as this term is defined in the Agreement; and (ii) thereafter undertook certain asbestos abatement and environmental remediation work and remarketing of the 303 Third Street Parcel for occupancy by commercial business tenants; and The Agency has previously disbursed the sum of Three Hundred Forty Four Thousand Dollars ($344,000) to the Owner for the acquisition of the 303 Third Street Parcel as provided under the Agreement; and The Owner has entered into an agreement for the improvement and sale of the 303 Third Street Parcel to the County of San Bernardino, or its assignee, in accordance with the terms of an agreement entitled, "Agreement for Purchase and Sale of Real Property" dated as of June 29, 2004, (the "County Purchase Contract") by and between the County of San Bernardino and the Owner. A true and correct copy of the County Purchase Contract is on file with the Agency Secretary; and The terms of the County Purchase Contract provide for the Owner to finance, construct and install certain improvements to the 303 Third Street Parcel prior to the transfer of the 303 Third Street Parcel, as further improved by the Owner, to the County of San Bernardino in accordance with the terms and conditions ofthe County Purchase Contract; and In order to accommodate the further improvell1ent and disposition of the 303 Third Street Parcel to the County of San Bernardino for its 'use and occupancy as an annex to the Superior Court facilities on Arrowhead A venue, certain provisions of the Agreement need to be modified 4815-8450-4320.2 I P:\CDBG Dept\Maggie\Draft Docs\8.9..Q4(agcncy staft) Revised Amendment to OP A.doc "C () in order to assist the Owner to complete its obligations under the terms of the County Purchase Contract; and The Owner and the Agency believe it is appropriate to further amend the Agreement as set forth in this August 2004 Amendment. NOW THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION THE OWNER AND THE AGENCY HEREBY AGREE AS FOLLOWS: Section I. Unless the context of the usage of a particular term or phrase in this 2004 Amendment may otherwise require, the meaning of terms and phrases as used in this 2004 Amendment shall be the same as set forth in the Agreement. Section 2. (a) At the time when this 2004 Amendment is fully executed by the parties, the parties mutually acknowledge and agree that no default exists under the Agreement and the parties mutually acknowledge and agree further that neither party is aware of any facts or circumstances which, with the giving on notice to the other party under the Agreement, and the passage of the applicable cure period, would constitute a default under the Agreement. o (b) At the time when this 2004 Amendment is fully executed by the parties, the Owner hereby acknowledges and represents to the Agency, that the County Purchase Contract has been fully executed by the parties thereto, and that the County Purchase Contract is in full force and effect and that no condition precedent for the performance of the obligations of either party under the County Purchase Contract has failed to occur and to the actual knowledge of the Owner, no default has occurred or is in effect under the County Purchase Contract. (c) The Owner shall not materially modify or amend the County Purchase Contract without first obtaining the written consent of the Agency, which consent shall not be unreasonably withheld, conditional or delayed by the Agreement. (d) The Owner shall promptly provide the Agency with a copy of any written correspondence or notice to the Owner issued by the County of San Bernardino under the County Purchase Contract, in which the County of San Bernardino asserts the Owner is in default under the County Purchase Contract, or that the County of San Bernardino has elected to terminate the County Purchase Contract. Section 3. Subject to the terms and conditions of this 2004 Amendment, Section 4(c) of the Agreement is hereby further amended to read as follows: o "(c) The EDI Loan shall be evidenced by EDI Loan Promissory Note in the form attached as Exhibit "C." The EDI Loan Promissory Note shall be dated by the Escrow Holder on the day when the conditions for the State Sale Agreement and Section 7.0 of the City Section 108 Loan Agreement have been satisfied by the parties and when the fee title interest of the State in the 303 Third Street Parcel is transferred to the Owner and thereafter, the EDI Promissory Note shall mature on August I, 2006 and shall bear no interest prior to its maturity or 4815-8450-4320.2 2 P.:\CDBG Dept\Maggie\Draft Oocs\8-9-Q4(agency staff) Revised Amendment to OPA.doc "" () prepayment (except in the case of a default as provided in the EDI Loan Promissory Note). The EDI Loan Promissory Note shall be secured by the EDI Loan Performance Deed of Trust in the form attached as Exhibit "0", which affects the 303 Third Street Property, or such portion thereof as HUD may authorize and approve. The EDI Loan Performance Deed of Trust shall be subject only to: (i) the senior security interests of the City in the 303 Third Street Property under the terms of the City Section 108 Loan Agreement, (ii) the security interest of Arrowhead Credit Union or such other lender approved by the Executive Director, for its loan to Owner in an amount not to exceed Eight Hundred Thousand Dollars ($800,000) which shall be used and applied by the Owner solely for the purpose of payment for interim design work for and interior building shell construction work to be undertaken by the Owner under the County Purchase Contract to the 303 Third Street Property (iii) such other non-monetary lien exceptions to title in the 303 Third Street Property as approved by the Executive Director, in consultation with special legal counsel, as permitted or consistent with all applicable provisions of the HUD Section 108 Loan Agreement. " o Section 4. Subject to the terms and conditions of this 2004 Amendment, the Agency hereby agrees to forbear from the collection of the principal amount of $344,000 as now due the Agency under the EDI Loan Promissory Note until a new date of August 1,2006, at which time the Owner shall pay the Agency the sum of $344,000 under the EDI Loan Promissory Note, provided, however, that the EDI Loan Promissory Note shall subordinated to any Construction Loan and shall be payable sooner upon the occurrence of a default or event of prepayment under the Agreement, the EDI Loan Promissory Note, or the EDI Loan Performance Deed of Trust or upon the occurrence of a default of the Owner under the terms of the County Purchase Contract. Upon the request of the Owner, the Executive Director of the Agency is hereby authorized and directed to deliver to the Owner an EDI Loan Promissory Note forbearance letter in a form approved by Special Legal Counsel to the Agency, which forbearance letter shall include a notice to the Owner that the maturity date of the EDI Loan Promissory Note has been modified by this 2004 Amendment to be a new date of August I, 2006. Section 5. The third (3rd) paragraph of Section 5 of the Agreement is hereby further amended by this 2004 Amendment to read as follows: "The Participation Fee shall be due and payable to the Agency by the Owner on August I, 2006, or sooner upon the acceleration or prepayment of the Construction Loan and shall be subordinated to any Construction Loan and payable as provided herein. Provided that the Participation Fee is paid to the Agency when due, no interest shall be payable by the Owner to the Agency on the Participation Fee prior to the time when it is due and payable. If not paid to the Agency in full when due, the outstanding balance of the Participation Fee shall bear interest at the maximum rate per annum permitted by law, until paid to the Agency in full." o 4815-8450-4320.2 3 P:\CDBG Dept\Maggie\Draft Docs\8-9-Q4(agency stam Revised Amendment to OPA.doc () o o Section 6. The provisions of Section 5 of the amendment to the Agreement, dated as of July I, 2003, are hereby declared to be of no further force or effect under the terms and conditions of this 2004 Amendment. Section 7. (a) The provisions of Section 6 of the amendment to the Agreement dated as of July I, 2003 are hereby repealed and replaced with the provisions of Section 7(b) of this 2004 Amendment. (b) Section 8 of the Agreement provides for the payment by the Owner of certain tax increment revenues or a fee in lieu of annual payment of property taxes to the Agency for a limited period of time. Notwithstanding any other provision of the Agreement or the Notice of Memorandum of Agreement to the contrary, such obligation to pay a fee in lieu of annual payment of property taxes on the part of the Owner shall be deemed to by fully satisfied upon (i) payment to the Agency by the Owner of the cash amount equal to $250,000 and (ii) the close of escrow for the sale of the 303 Third Street Parcel by the Owner to the County of San Bernardino, in accordance with the provisions of the County Purchase Contract. Such obligation of the Owner shall only be satisfied if the 303 Third Street Parcel is actually sold to the County of San Bernardino, the required amount under this 2004 Amendment Section 7(b) is paid to the Agency, and title to the 303 Third Street Parcel has transferred to the County of San Bernardino. When the conditions set forth in the preceding section have been satisfied, the Agency shall cause to be delivered to the County of San Bernardino for recordation concurrently upon the close of the escrow and the transfer by the Owner of the fee title interest in the 303 Third Street Parcel to the County of San Bernardino under the County Purchase Contract an instrument in recordable form in which the Agency quitclaims to the County of San Bernardino all of its right, title and interest in the covenant of the Owner to pay property taxes or an annual in lieu fee to the Agency as otherwise set forth in Section 8 of the Agreement. In the event that the sale to the County of San Bernardino of the 303 Third Street Parcel does not occur on or before August I, 2006, then Section 8 of the Agreement shall remain in full force and effect and this Section 7(b) ofthis 2004 Amendment shall be of no further force and effect from and after the earlier date of August I, 2006 or such earlier date on which the County Purchase Contract may be terminated by the parties thereto. Section 8. The Agency hereby acknowledges that the Owner has substituted one of its former managing members, J. Kevin Brunk, for another managing member; CJJ, Inc., a California Corporation. Subject to the delivery by the Owner to the Agency of an approving legal opinion of the attorneys for the Owner addressed to the Agency in a form reasonably satisfactory to the Agency Counsel stating that the substitution of such former managing member by CJJ, Inc., has been duly authorized by the Owner and that the obligations of the Owner as arise in favor of the Agency under the Agreement are in full force and effect and are enforceable in accordance with its terms, the Agency hereby acknowledges its acceptance of CJJ, Inc., a California Corporation as a managing member of the Owner. 4815-8450-4320.2 4 P:\CDBO Oept\Maggie\Draft Docs\8.9-04(agency staff) Revised Amendment to OPA.doc o o o Section 9. This 2004 Amendment shall take effect when it has been approved by the governing board of the Agency and fully executed by the Owner and the Agency and when each of the conditions set forth in Section 16 of that certain August 2004 Amendment to the Section 108 Loan Agreement by and between the Owner and the City of San Bernardino of even date herewith, have been satisfied. Section 10. Except as modified by this 2004 Amendment all other provisions of the Agreement and the ED! Promissory Loan Note and the ED! Loan Performance Deed of Trust and the Notice of Memorandum of Agreement remain in full force and effect and all of the representations, warranties and covenants of the Owner under the Agreement remain true and correct as of the date of execution of this 2004 Amendment by the Owner. Section 11. This 2004 Amendment may be executed by the parties in counterparts and when fully executed, each counterpart shall be deemed to be one original instrument. (signature page to follow) 4815-8450-4320.2 5 P:\CDBG Dept\Maggie\Draft Docs\8-9-04(agency staff) Revised Amendment to OPA.doc o o o THIS 2004 AMENDMENT is executed by the authorized officers and members of the parties whose signatures appear below. AGENCY Redevelopment Agency of the City of San Bernardino, a public body corporate and politic Date: By: Chair, Community Developrnent Commission APPROVED AS TO FORM: By: Agency Secretary By: G~~ Agenc unsel Sr"c..1 OWNER 303. L.L.c., a California limited liability company Date: By: Martin A. Matich, Manager - and- By: CJJ, Inc., a California Corporation, Manager APPROVED AS TO FORM: By: J. Kevin Brunk, its President By: Attorney for Owner 4815.8450.4320.2 6 P:\CDBG Depl\Maggie\Drall Docs\S.9-04(agency stan) Revised Amendment 10 OPA.doc o o o AUGUST 2004 AMENDMENT TO 2000 COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM SECTION 108 PROJECT DEVELOPMENT LOAN AGREEMENT (B-94-MC-06-0539-A) (303 Third Street Project) THIS AUGUST 2004 AMENDMENT TO 2000 COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM SECTION 108 PROJECT DEVELOPMENT LOAN AGREEMENT ("August 2004 Amendment") is dated as of August 16, 2004, by and between 303, L.L.C., a California limited liability company (the "Borrower") and the City of San Bernardino, a municipal corporation (the "City") is made and executed in light of the following facts: -- RECITALS -- The Borrower and the City have previously entered into that certain loan agreement entitled "2000 Community Development Block Grant Program Section 108 Project Development I,oan Agreement", dated as of September 18, 2000, as amended (the "Agreement"). The City has previously disbursed to the Borrower certain funds for the acquisition of the "303 Third Street Parcel" and for the construction and installation of the "Borrower Improvements (Phase I)", as these terms are defined in the Agreement. The Borrower has entered into an agreement entitled "Agreement for Purchase and Sale of Real Property", as authorized by the Board of County Supervisors dated June 29, 2004 (the '(,untl' Purchase Contract"), by and between the County of San Bernardino ("County") and the Borrower, whereby the Borrower shall construct and finance certain additional improvements to the 303 Third Street Parcel and upon the completion of such additional improvements, the Borrower shall transfer its fee title interest in the 303 Third Street Parcel, as improved, to the County of San Bernardino for the purchase price payable to the Borrower by the County as set forth in the County Purchase Contract. The Borrower and the City believe it is appropriate to further amend the Agreement as set forth in this August 2004 Amendment in order to accommodate the terms and conditions of the improvement and sale of the 303 Third Street Parcel to the County in accordance with the terms of the County Purchase Contract. NOW THEREFORE AND FOR GOOD AND VALUABLE CONSIDERATION THE BORROWER AND THE CITY AGREE AS FOLLOWS: Section I. Unless the context of the usage of a particular term or phrase may otherwise require, the meaning of terms and phrases as used in this August 2004 Amendment shall be the same as set forth in the Agreement. Section 2. (a) At the time when this August 2004 Amendment is fully executed by the parties, the Borrower and the City mutually acknowledge and agree that no default exists 48133184-60802 I P:\CDBG Dept\Maggie\Draft Docs\8*9-04 (agency slaff) Re\lised AmendmenllO Section 108 loan.doc o o o under the Agreement, and the parties mutually acknowledge and agree further that neither party is aware of any fact or circumstance which, with the giving of notice to the other party under the Agreement and the passage of the applicable cure period, would constitute a default under the Agreement. Section 3. The text which appears in Section 1.0 of the Agreement under the heading "Approved 303 Third Street Project Budget" is hereby labeled to read as: "(A) Approval 303 Third Street Project Budget (June 1, 2001)", and section 1.0 of the Agreement is further amended to add the following text: "(B) Approved 303 Third Street Project Budget (County Purchase Contract)" On the effective date of the August 2004 Amendment to the Agreement, the words "Approved 303 Third Street Project Budget" refer to the various elements of cost which comprise the "Bid Purchase Price", as this term is defined in Section 2.5 of the County Purchase Contract, and the "Approved 303 Third Street Project Budget", as originally approved by the City as provided in Section 7.0 of the Agreement shall have no force or effect with respect to the Borrower Improvements (Phase II)." Section 4. The text of Section 1.0 of the Agreement is hereby amended to add the following defined term: ". Borrower Improvements (Phase II). The words "Borrower Improvements (Phase II)" mean and refer to the improvements to be financed, constructed and installed on the 303 Third Street Parcel by the Borrower in accordance with the terms and conditions of the County Purchase Contract. The Borrower shall obtain the Construction Loan to pay for a portion of the costs associated with the Borrower Improvements (Phase II). Section 1.43 of the County Purchase Contract defines the term "Improvements" as follows: "Improvements" means the Shell Improvements, the Tenant Improvements and the Landscape Improvements." The "Plans and Specifications" as this term is defined in Section 1.53 of the County Purchase Contract, are attached as Exhibit "D" to the County Purchase Contract." Section 5. The text of Section 1.0 of the Agreement is hereby amended to add the following defined tern!: ". County Purchase Contract. The words "County Purchase Contract" mean and refer to that certain instrument entitled "Agreement for Purchase and Sale of Real Property" dated as of June 29, 2004, by and between the County and the Borrower. A true and correct copy of the County Purchase Contract is on file with the Agency Clerk. The County Purchase Contract provides for the terms and conditions on which the County of San Bernardino may hereafter acquire the 303 Third Street Parcel, and/or provide the County with an option to also purchase the non-contiguous "Option Property" owned by the Borrower under Section 16 of the County Purchase Contract. Such non- contiguous "Option Property" is identified in the Agreement as the "Parking Lot Parcel"." 4813-3284-6080.2 2 P:\CDBG Dept\Maggie\Draft Docs\8.9-04 (agency staff) Revised Amendment to Section 108 Loan.doc o o o Section 6. The text of Section 1.0 of the Agreement is hereby amended to add the following defined term: ". Mezzanine Financing. The words "Mezzanine Financing" shall have the meaning as set forth in Section 12.0(9)." Section 7. Subject to the terms and conditions of this August 2004 Amendment, Section 5.0(a) of the Loan Agreement is hereby amended to read as follows: "Section 5.0 SECTION 108 LOAN (a) The Section 108 Loan shall be in an amount not to exceed the principal sum of One Million Eight Hundred Forty Thousand Dollars United States currency ($1,840,000.00), and the Section 108 Loan shall bear interest on so much of the principal sum as shall be drawn by the City under its HUD Section 108 Loan Agreement for disbursement to the Borrower from time-to-time. The outstanding principal balance of the Section 108 Loan shall bear interest payable to the City by the Borrower from the date of each disbursement of principal under the HUD Section 108 Loan Agreement at the variable rate of interest specified in the Borrower Section 108 Loan Promissory Note until such time as such variable rate of interest may be reset as a permanent rate of interest following the "Conversion Date" as this term is set forth under the HUD Section 108 Loan Agreement and the Borrower Section 108 Promissory Note. The City shall notify the Borrower as promptly as feasible of such notification as the City may receive, if any, from the Secretary of HUD, that the Secretary of HUD intends for a Conversion Date to occur under the "HUD Note", as set forth in subparagraph number six of Paragraph 1.A. of the Borrower Section 108 Promissory Note. The City agrees to exercise best efforts, if directed by the Borrower, to request the Secretary of HUD not to cause a Conversion Date to occur; provided however, that the Secretary of HUD reserves its sole discretion under the HUD Note and the HUD Section 108 Loan Agreement to cause a Conversion Date to occur. Payments of interest on the Section 108 Loan shall be due and payable by the Borrower to the City in installments at the times set forth in the Borrower Section 108 Loan Promissory Note. Installments of principal disbursed to the Borrower shall be payable to the City prior to maturity or the acceleration of the Section 108 Loan, (assuming that the Borrower has received disbursements of the aggregate principal sum of $1,840,000.00) from and after the close of Escrow on the dates and in the amounts scheduled for payment as follows: 4813-3284-60802 3 P:\CDBG Dept\Maggie\Draft Docs\8-9-04 (agency staff) Revised Amendment to Section 108 Loan,doc Date of Principal Amount of Date of Principal Amount of 0 Installment Principal Due Installment Principal Due August 1,2001 $ -0- August 1,2011 $100,000.00 August 1,2002 -0- August 1,2012 100,000.00 August I, 2003 -0- August 1,2013 100,000.00 August 1,2004 100,000.00 August 1,2014 100,000.00 August I, 2005 -0- August 1,2015 100,000.00 August 1,2006 -0- August 1,2016 100,000.00 August I, 2007 100,000.00 August 1,2017 100,000.00 August I, 2008 100,000.00 August 1,2018 100,000.00 August I, 2009 100,000.00 August 1,2019 100,000.00 August 1,2010 100,000.00 August I, 2020 440,000.00 Section 8. Section 10.0(6) of the Agreement is hereby amended to read as follows: () "(6) Use the funds disbursed to the Borrower under the Section 108 Loan, and later under the Mezzanine Financing and the Construction Loan, solely for payment of Approved 303 Third Street Project Budget costs, subject to the provisions of the next sentence relating to the Construction Loan. No proceeds of the Construction Loan, shall be disbursed or made available to the Borrower under the terms of the Construction Loan for any Approved 303 Third Street Project Budget costs identified in Section 2.5 of the County Purchase Contract as "General Contractor OH&P" or "Developer Fee", except in the amounts as specifically authorized by the County in Exhibit "L" to the County Purchase Contract. Section 9. Section 11.0(8) of the Agreement is hereby amended to read as follows: "(8) Create or allow to be created any lien or charge upon the 303 Third Street Property, except as may arise under the Mezzanine Financing (provided that any such lien of Mezzanine Financing shall be subordinate to the Section 108 Loan) The Construction Loan, the Permanent Loan, the OP A, this Agreement, or a Tenant lease." Section 10. Section 12.0 of the Agreement is hereby amended to add three (3) new subsections to Section 12.0 (Section (8), (9) and (10)) which read as follows: o "(8) The City has approved the County Purchase Contract concurrently with the approval by the City of the August 2004 Amendment to this Agreement. From and after the effective date of the August 2004 Amendment to the Agreement, the 4813.3284.60802 4 P:\CDBG Dept\Maggie\Draft Docs\8-9-04 (agency staft) Revised Amendment to Section 108 Loan.doc () (9) o Borrower shall not consent to a material amendment of the County Purchase Contract without first obtaining the prior written consent of the City, which consent shall not be unreasonably withheld, conditioned or delayed by the City. Provided the Borrower has satisfied the requirements of Section 12.0( I 0), the City hereby permits and authorizes the Borrower to obtain certain interim financing prior to the recordation of the Construction Loan (the "Mezzanine Financing") in a principal amount not to exceed Eight Hundred Thousand Dollars ($800,000), for the purpose of paying for the actual third party costs incurred by the Borrower prior to the recordation of the Construction Loan, in connection with the design and design engineering work associated with the preparation by the Borrower of the "Plans and Specifications," as this term is defined under the County Purchase Contract. The Mezzanine Financing may be secured by the 303 Third Street Parcel, subject to the senior security interest of the City under its City Security Interest in the 303 Third Street Parcel, including the City Deed of Trust. The security interest of the lender under the Mezzanine Financing shall be released by such lender in the 303 Third Street Parcel and the Mezzanine Financing shall be paid in full concurrently with the recordation of the Construction Loan, or sooner, upon the receipt by the Borrower of any sums payable by the County of San Bernardino to the Borrower under Section 2.8 of the County Purchase Contract. (10) Within the earlier period of sixty (60) days following the effective date of the August 2004 Amendment to this Agreement or prior to the recordation of any security interest of the third party lender under the Mezzanine Financing, the Borrower shall execute an appropriate amendment or supplement to the Borrower Assignment of Agreements in a form reasonably satisfactory to the City, to include a collateral security assignment of the County Purchase Contract, to the City as security for the Borrower Indebtedness. Such amendment or supplement to the Borrower Assignment of Agreements shall contain an acknowledgement of the City that its security interest in the County Purchase Contract and all of the related contracts, agreements and permits associated with the Borrower Improvements (Phase II) shall be subordinate to the security interest of the Construction Lender in the County Purchase Contract and related contracts, agreements and permits, as provided in Section 14.0 of this Agreement." Section II. Section 13.0(13) of the Agreement is hereby amended to read as follows: "(13) After the Construction Lender Subordination Agreement is executed by the Borrower and the Agency and filed for recordation, if the construction of the Borrower Improvements (Phase II) is not promptly commenced, or after its commencement, such work is abandoned or work thereon ceases for a period of more than ninety (90) days for any reason, or if the Borrower Improvements (Phase II) are not completed within fifteen (15) months following the recordation of the Construction Lender Subordination Agreement, subject to force majeure events under the County Purchase Contract, and further subject to such permitted extensions of time as may be approved by the County under the County Purchase Contract; provided however, that the aggregate amount of permitted extensions of time as may be approved by the County shall not exceed more that one hundred 4813-3284-6080.2 5 o P:\CDBG Dept\Maggie\Draft Oocs\8-9-04 (agency staff) Revised Amendment to Section 108 Loan.doc o o o eighty (180) days without the Borrower first obtaining the approval of the City which approval shall not be unreasonably withheld, conditioned or delayed by the City." Section 12. Section 13.0 of the Agreement is hereby amended to add a new Section 13.0(21) and Section 13.0(22) which reads as follows: "(21) The Borrower is in default of any material term of the Mezzanine Financing loan agreement. (22) The Borrower is in default of any material term of the County Purchase Contract." Section 13. Section 14.0(a) of the Agreement is hereby amended to read as follows: "(a) Upon the completion of the Borrower Improvements (Phase I) the City hereby agrees to subordinate the City Security Interest in the 303 Third Street Property to the Construction Loan as provided in this Section 14.0, subject to the satisfaction of the following conditions: (i) The maximum principal amount of the Construction Loan (including funded interest reserves and customary and reasonable costs of financing) shall not exceed $15,000,000 unless the proposed amount of the Construction Loan in excess of $8,500,000.00, and up to the maximum amount of $15,000,000 does not cause the loan-to-value ratio referenced in Section 14.0(a)(viii) to exceed 80% and is acceptable to HUD under the HUD Section 108 Loan Agreement, if applicable; (ii) At the time of the City's execution of the Construction Lender Subordination Agreement, there shall be no default of the Borrower under the OP A, this Agreement or the City Security Interest; (iii) the Borrower shall repay the Mezzanine Financing upon recordation of the Construction Lender Subordination Agreement; (iv) at the time of recordation of the Construction Lender Subordination Agreement there shall be no default by either party under the County Purchase Contract; (v) the Borrower shall have paid all financing costs charged by HUD to the City under the HUD Section 108 Loan through the date of the recordation of the Construction Lender Subordination Agreement (including HUD underwriter costs presently estimated to be $25,000.00) if not previously paid by the Borrower to the City; (vi) no provision of the Construction Lender Subordination Agreement shall require the City (or HUD) to waive or suspend its right to receive payments of principal and interest when due under the Section 108 Loan, 6 4813.3284-60802 P:\CDBG Dept\Maggie\Draft Docs\8-9-04 (agency staff) Revised Amendment to Section 108 Loan,doc o this Agreement or the City Security Interest prior to a default by the Borrower to the Construction Lender; and in the event of a default by the Borrower under the Construction Loan or this Agreement, no provision of the Construction Loan or the Construction Lender Subordination Agreement shall require the City to first obtain the consent of such Construction Lender following a default of the Borrower before the City may draw on the Borrower Letter of Credit or demand payment from any person under the Borrower Guaranties. In the event of a default by the Borrower under the Construction Loan the Construction Lender shall not unreasonably delay its approval, if requested by the City, of the exercise by the City of any of the City's remedies under the other security interests of the City in the 303 Third Street Property given by the Borrower to the City; (vii) the Construction Loan documents shall contain provlSlons reasonably satisfactory to the City which assure the City that: (I) an independent lender's disbursement control service shall be used to perform the customary functions of a construction lender disbursement control and payment verification; (2) the Construction Lender, and the construction lender disbursement control service, shall require the Borrower to provide the Construction Lender as part of each application for a disbursement of funds under the Construction Loan for labor performed on the 303 Third Street Property, a written certification (with a copy to the City) that all labor and construction trades personnel employed by either the Borrower or the Borrower Contractor and all subcontractors of either of them who perform work on the 303 Third Street Project have been paid not less than "prevailing wages" as this term is defined under 40 U.S.c. Section 276a-276a- 5 (Davis-Bacon Prevailing Wage Law, as amended); o (3) the Construction Loan documents shall not be materially modified or amended following the approval of the Construction Loan by the City under Section 14.0(b) without the Borrower first obtaining the written approval of the City, and such approval shall not be reasonably withheld, conditioned or delayed; (4) the Construction Loan documents shall be consistent with the provisions of Section 10.0(6) and shall provide that no "developer fees, costs, expenses, overhead and profit" and the like shall be payable from the proceeds of the Construction Loan to the Borrower; o (viii) receipt by the City of a MAl appraisal prepared in accordance with real property standards acceptable to a federally chartered lending institution, and otherwise reasonably acceptable in form to the Agency, which 4813.3284-6080.2 7 P:\CDBG DepfMaggie\Draft Docs\8-9-04 (agency staff) Revised Amendment to Section 108 Loan.doc () indicates that the loan-to-value ratio of the 303 Third Street Project under the proposed Construction Loan and the Section 108 Loan shall not exceed 80% of the appraised value of the 303 Third Street Property." Section 14. Subject to the terms and conditions of this August 2004 Amendment, the City hereby agrees to forbear from the collection of the principal sum of Two Hundred Thousand ($200,000) which would otherwise be due and payable by the Developer to the City on August I, 2005, and on August I, 2006, respectively, under the terms of the Borrower Section 108 Promissory Note, to a new date of August I, 2020, at which time the Borrower shall pay, in addition the $240,000 scheduled amount of principal due under the Borrower Section 108 Loan Promissory Note on such date, an additional aggregate sum of $200,000 in principal, so that as modified by this August 2004 Amendment, the total amount of principal as shall be due on August I, 2020, shall be $440,000. If requested by the Borrower, the Executive Director of the Economic Development Agency is hereby authorized and directed to deliver to the Borrower a loan forbearance letter in a form approved by Special Legal Counsel to the City which includes a notice to Borrower that the "Commitment Schedule" (page 12 of the Borrower Section 108 Promissory Note) is hereby amended to read as follows: "COMMITMENT SCHEDULE Principal Due Date Commitment Amount o August 1,2001 August I, 2002 August I, 2003 August I, 2004 August I, 2005 August I, 2006 August I, 2007 August I, 2008 August I, 2009 August 1,2010 August 1,2011 August 1,2012 August 1,2013 August 1,2014 August 1,2015 August 1,2016 August 1,2017 August 1,2018 August 1,2019 August 1,2020 $ -0- -0- -0- 100,000.00 -0- -0- 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 440,000.00 Maximum Commitment Amount $1,840,000.00" o The Executive Director of the Economic Development Agency is further authorized and directed to include in the loan forbearance letter referenced in the preceding paragraph, a notice 4813-3284-6080.2 8 P:\CDBG Dept\Maggicl.Draft Docs\8-9-04 (agency staff) Revised Amendment to Sa;tion 108 Loan.doc o to the Borrower that the "Schedule P&I" (page IS of the Borrower Section 108 Promissory Note) has been amended to read as follows: "SCHEDULE P & I Principal Amount Available Principal Interest Rate Optional Redemption Due Date YES NO $ -0- August 1,2001 X -0- August I, 2002 X -0- August 1,2003 X 100,000 August I, 2004 X -0- August I, 2005 X -0- August 1,2006 X 100,000 August I, 2007 X 100,000 August I, 2008 X 100,000 August I, 2009 X 100,000 August 1,2010 X 0 100,000 August 1,2011 X 100,000 August 1,2012 X 100,000 August I, 2013 X 100,000 August 1,2014 X 100,000 August 1,2015 X 100,000 August 1,2016 X 100,000 August 1,2017 X 100,000 August 1,2018 X 100,000 August 1,2019 X 440,000 August I, 2020 X $1 840.000 = Aggregate Principal Amount Principal Amounts for which Optional Redemption is available may be redeemed, subject to the terms contained herein and in the Loan Agreement, on any Interest Due Date on or after August 1,2010." The Executive Director of the Economic Development Agency shall transmit such loan forbearance letter to the Borrower concurrently upon the satisfaction of the conditions set forth in Section 16. o Section IS. (a) The City and the Borrower hereby agree that as of July 31, 2004, the balance of funds in the "Funded Interest Reserve Fund" established by the Borrower and the City under the Section 108 Loan was approximately $163,403. As of August I, 2004, the Borrower hereby authorizes and directs the City to withdraw the sum of One Hundred and Thousand Dollars ($100,000) from the Funded Interest Reserve Fund, which the City shall use 4813-3284-60802 9 P:\CDBG Depl\Maggie\Draft Docs\8-9-04 (agency staff) Revised Amendment to Section 108 loan.doc () () o and apply to pay HUD the principal installment amount of $100,000 which became due and payable on August I, 2004, under the terms of the HUD Section 108 Loan Agreement and the City shall also withdraw from such Funded Interest Reserve Fund an amount sufficient to bring current all interest payments due from the Borrower as of August I, 2004. The City shall use and apply the remaining balance of the Funded Interest Reserve Fund, after the application of the sums described in the preceding sentence to pay principal and accrued interest to the City due as of August 1,2004, to pay current accrued interest from and after August 1,2004 to HUD under the HUD Section 108 Loan Contract, and the City shall transfer all interest payments received from the Borrower under subsection (b), below, commencing with the first such current interest payment on November I, 2004, to the Funded Interest Reserve Fund, and the City shall use any remaining balance in the Funded Interest Reserve Fund to pay the outstanding principal balance of the Section 108 Loan upon its maturity, or sooner upon prepayment in full of the Section 108 Loan by the Borrower. (b) Notwithstanding any other provision of this Agreement or the Section 108 loan Agreement to the contrary, commencing on November 1, 2004, the Borrower shall pay to the City current interest, which accrues on the outstanding balance of the Section 108 Loan on and. after August I, 2004 or a quarterly basis. Such quarterly payments of current accrued interest by the Borrower to the City shall be due November I, February I, June I and on August 1, each year until the earlier date of when the interest rate under the Section 108 Loan is converted to a f')o.cd rate of interest or the Section 108 Loan is paid in full. Section 16. The City hereby acknowledges that the Borrower has substituted one of its former managing members, J. Kevin Brunk, for another managing member, CJJ, Inc., a California Corporation. Subject to the delivery by the Borrower to the Agency of an approving legal opinion by the attorneys for the Borrower addressed to the City and to HUD in a form reasonably satisfactory to the Agency Counsel stating that the substitution of such former managing member for CJJ, Inc., has been duly authorized by the Borrower and that the obligations of the Borrower as arise in favor of the City under the Agreement are in full force and effect and are enforceable in accordance with their terms, the City hereby acknowledges its acceptance of CJJ, Inc., a California Corporation as a managing member of the Borrower. Section 17. This August 2004 Amendment shall take effect when it has been approved and fully executed by the Borrower and the City and when each of the following conditions have been satisfied: (i) the City and the Secretary of the United States Department of Housing and Urban Development have entered into an appropriate amendment to HUD Section 108 Loan No. B-94-MC-06-0539-A in a form satisfactory to the Mayor and the Executive Director of the Economic Development Agency which provides that the principal sums payable by the City to HUD under HUD Contract Loan No. B- 94-MC-06-0539-A, shall be due and payable by the City to HUD in the amounts and on the dates as follows: Principal Due Date Commitment Amount August I, 200 I August I, 2002 $ -0- -0- 48 I 3-3Z84-60802 10 P:\CDBG Dept"Maggie\.Draft Docs\8.9-04 (agency staft) Revised Amendment to Section 108 Loan.doc o August I, 2003 August I, 2004 August 1,2005 August 1,2006 August I, 2007 August I, 2008 August I, 2009 August 1,2010 August 1, 2011 August 1,2012 August I, 2013 August 1,2014 August 1,2015 August 1,2016 August 1,2017 August 1,2018 August 1,2019 August I, 2020 -0- 100,000.00 -0- -0- 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 440,000.00 Maximum Commitment Amount $1,840,000.00 (ii) the Borrower and the Redevelopment Agency of the City of San Bernardino have entered into an appropriate amendment to that certain agreement entitled "2000 Owner Participation and ED! Loan Agreement" dated as of September 18, 2000, as amended (the "OP A"), which provides that: (A) the maturity date of the ED! Loan Promissory Note shall be modified to a new date of August 1,2006 and (B) due date for the payment of the sum of Two Hundred Thousand Dollars ($200,000) by the Borrower to the Agency under Section 5 of the OP A shall be modified to a new date of August I, 2006 provided however that in the case of both subparagraphs (A) and (B), such obligation of the Borrower to the Agency shall be payable sooner upon: (i) the sale of the 303 Third Street Parcel by the Borrower to San Bernardino County under the terms of the County Purchase Contract or; (ii) the occurrence of a default under the ED! Loan Promissory Note; o (iii) Wells Fargo Bank National Association, as custodian for HUD under the terms of that certain "Financial and Document Custodian and Trustee Agreement" dated June 6,2001 by and between Wells Fargo National Association and the City, shall have accepted the receipt of the collateral assignment of this August 2004 Amendment by the City of this Amendment for the benefit of HUD; (iv) the Borrower shall have delivered to the City the approving legal opinion of its attorney as described in Section 16; and o (v) the Executive Director of the Economic Development Agency shall have issued a . loan forbearance letter in form approved by Special Legal Counsel to the City which acknowledge to Borrower that so long as no Event of Default exists under the Agreement as hereby amended (and further provided that no other event of prepayment has occurred under any of the Section 108 Loan Collateral), that the 4813-3284.6080.2 II P:\CDBG Dept\Maggie\Draft Docs\8.9-04 (agency Slam Revised Amendment to Section 108 loan.doc o o o next installment of principal due the City under the terms ofthe Borrower Section 108 Promissory Note shall be on the new date of August 1,2007. Section 18. Except as modified by this August 2004 Amendment all other provisions of the Agreement and Section 108 Loan Collateral remain in full force and effect and all of the representation, warranties and covenants of the Borrower under the Agreement and the Section 108 Loan Collateral remain true and correct as of the date of execution of this August 2004 Amendment by the Borrower. Section 19. This August 2004 Amendment may be executed by the parties in counterparts and when fully executed, each counterpart shall be deemed to be one original instrument. (signature page to follow) 4813-3284-6080.2 12 P:\CDBG Dept\Maggie\Draft Docs\8-9-04 (agency stam Revised Amendment to Section 108 loan.doc o THIS AUGUST 2004 AMENDMENT is executed by the authorized officers and members of the parties whose signatures appear below. CITY City of San Bernardino, a municipal corporation Date: By: Mayor By: City Clerk By: Executive Director of the Economic Development Agency APPROVED AS TO FORM s,-i~ ~ o BORROWER 303, L.L.C., a California limited liability company Date: By: Martin A. Matich, Manager - and- By: CJJ, Inc., a California Corporation, Manager APPROVED AS TO FORM By: J. Kevin Brunk, its President -. Attorney for Borrower o 4813-3284.6080.2 I3 P:\CDBG Dept\Maggie\Draft Docs\8-9-04 (agency staff) Revised Amendment to Section 108 Loan.doc ()) 01 o AUGUST 2004 MEMORANDUM OF AMENDMENT TO SECTION 108 LOAN GUARANTEE COMMITTMENT (B-94-MC-06-0539-A) AWARDED TO THE CITY OF SAN BERNARDINO, CALIFORNIA 2000 COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM SECTION 108 PROJECT DEVELOPMENT LOAN ($1,840,000 FOR THE 303 THIRD STREET PROJECT) I THIS AUGUST 2004 MEMORANDUM (the "August 2004 Memorandum") is dated as of August 16, 2004 and is delivered by the City of San Bernardino (the "City") to the United States Secretary of the Department of Housing and Urban Development ("HUD") in light of the facts set forth in the following recitals: - - RECITALS -- A. HUD and the City are parties to that certain Contract for Loan Guarantee Assistance, dated as of September 26, 2000, as amended by First Amendment to Contract for Loan Guarantee Assistance, dated March 5, 2001, as modified by a letter addressed to the City from HUD, dated September 18,2002 (collectively the "HUD Contract") pmsuantto which the City has been authorized to loan up to One Million Eight Hundred Forty Thousand Dollars ($1,840,000) of Community Development Block Grant Program Section] 08 guaranteed funds to 303, L.L.c., a California limited liability company (the "Obligor") in connection with the acquisition and development of certain property referred to by the City as "303 Third Street Property", San Bernardino, California. B. The City has provided the proceeds of the HUD Grant Program Section 108 Loan guaranteed fund as authorized under the HUD Contract to the Obligor in accordance with the tern1S and conditions of a loan agreement entitled, "2000 Community Development Block Grant Program Section 108 Project Development Loan Agreement", dated as of September 18, 2000, as amended (the "Obligor Loan Agreement") by and between the Obligor and the City. C. In order to accommodate the completion of certain further improvements to the 303 Third Street Property, to be undertaken and financed by the Obligor in preparation for sale and disposition of 303 Third Street Property by the Obligor to the County of San Bernardino for occupancy and use by the County of San Bernardino as office space for certain judicial functions and services of the Superior Court of San Bernardino County, the City has requested HUD to approve certain technical modifications of the HUD Contract, as set forth below in the following sections of this August 2004 Memorandum. 48J:\.U76':.:'I~";, 1 o 0.. o D. Concurrently with the approval of this August 2004 Memorandum by HUD and the City, the Obligor and the City shall execute a conforming amendment to the Obligor Loan Agreement in order to accommodate the completion by the Obligor of certain improvements to the 303 Third Street Property. NOW, THEREFORE, HUD AND THE CITY HEREBY AGREE AS FOLLOWS: Section I. The text of the HUD Contract is hereby incorporated into this August 2004 Memorandum by this reference. Unless the context of the usage of a particular term or phrase used in this August 2004 Memorandum may otherwise require, the meaning of terms and phrases as used in the August 2004 Memorandum shall be the same as set forth in the HUD Contract. Section 2. Reference is hereby made to that certain agreement dated June 29, 2004, by and between San Bernardino ,County and the Obligor entitled "Agreement for Purchase and Sale of Real Property between The County of San Bernardino and 303, 1.1. c." (the "County Property Purchase Contract"). The Obligor has represented and warranted to the City that the County Property Purchase Contract is in full force and effect as of the date of this August 2004 Memorandum, and that such County Property Purchase Contract is enforceable by the Obligor in accordance with its terms. A true and correct copy of the County Property Purchase Contract is on file with the County Clerk and is attached herewith. Section 3. The City hereby represents to HUD that as of the date of this August 2004 Memorandum, no default exists under the Obligor Loan Agreement. Section 4. . The City hereby represents and confirms to HUD that as of the date of this August 2004 Memorandum, the City has taken no action in furtherance of the authority granted to the City by HUD under the terms of the letter of HUD, dated September 18, 2002, addressed to the City. The Borrower Letter of Credit remains in full force and effect. The City shall cause the Obligor to maintain the Borrower Letter of Credit until the earliest of the following dates occur: (i) the Obligor causes the "Section 108 Loan", as this term is defined in the Obligor Loan Agreement, to be paid in full; or (ii) the conditions set forth in the Obligor Loan Agreement for the release of the Borrower Letter of Credit have been satisfied by the Obligor. Section 5. (a) Paragraph IS of the HUD Contract is hereby amended by modifying the provisions of Paragraph 15(c)(i) to read as follows: "[HUD Contract Paragraph 15(c), Obligor Note, Obligor Loan Agreement and Obligor Collateral...] "(i) A lien on the real property described in Attachment 3 hereof (the "Property"), established through an appropriate and properly recorded deed of ~813-676~-5184.1 '") ()) 01 () trust (the "Deed of Trust"). The Deed of Trust may be subordinate to a first lien of no more than Fifteen Million Dollars ($15,000,000) (a "First Lien") and shall contain such provisions as the Secretary deems necessary. In no event shall the loan-to-value ratio of the Guaranteed Loan Funds disbursed to the Obligor, plus the First Lien amount, exceed 80% of the appraisal loan value of the Property, as determined by the appraisal approved by the beneficiary under such First Lien, or as determined by the appraisal provisions in Paragraph 15(e)(xi) of this Contract." (b) Paragraph 15 of the HUD Contract is hereby amended by modifying the provisions of Paragraph 15(c)(iii) to read as follows: [HUD Contract Paragraph 15(c)...Obligor Note, Obligor Loan Agreement and Obligor Collateral...] "(iii) Any and all rig4ts, titles, and interests of the Obligor in any to any licenses, permits, and other agreements covering the Property. Such rights, title and interests shall be the subject of a collateral assignment of interest in licenses, permits, and other agreements (the "Collateral Assignment of Interest in Licenses Permits and Agreements"). The Collateral Assignment of Interest in Licenses, Permits and Agreements shall be in a form acceptable to the Secretary. The Obligor shall also assign to the Borrower as additional collateral under the Obligor Loan Agreement, the rights of the Obligor under the County Property Purchase Contract, subordinate to the collateral security rights therein of the beneficiary under the First Lien, and such collateral assignment by the Obligor to the Borrower shall be evidenced by a written supplement to the Collateral Assignment of Interest in Licenses, Permits and Agreements prepared by the Borrower in a form acceptable by the Secretary." Section 6. The "Commitment Schedule" for the Borrower $1,840,000 Promissory Note under the HUD Contract, is hereby modified to provide for installment payments of principal by the City to HUD, and its assigns, as follows: "COMMITMENT SCHEDULE - Note No. B-94-MC-06-0539-A Principal Due Date Commitment Amount August 1,2001 August I, 2002 August I, 2003 August 1,2004 August I, 2005 August I, 2006 August I, 2007 August I, 2008 August I, 2009 August 1,2010 $ -0- -0- -0- 100,000 -0- -0- 100,000 100,000 100,000 100,000 4l-: 13.(l764.;'i I f:4, 1 , ,) o 01 (), August 1,2011 August 1,2012 August 1,2013 August 1,2014 August 1,2015 August 1,2016 August 1,2017 August I, 2018 August 1,2019 August I, 2020 100,000 $ 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 440.000 Maximum Commitment Amount $1.840.000" Section 7. HUD hereby authorizes the City to make certain technical revisions and amendments to the Obligor 4>an Agreement, and the related Obligor Section 108 Loan documents, in which the City has previously assigned its security interest to HUD as collateral security in favor of HUD under the HUD Contract, as consistent with this August 2004 Memorandum, in order to accommodate the financing and construction and completion of improvement of the "303 Third Street Property", as this term is defined in the Obligor Loan Agreement, by the Obligor pursuant to the terms and conditions of the County Property Purchase Contract. Section 8. Except as modified or amended by this August 2004 Memorandum, all other provisions of the HUD Contract shall remain in full force and effect, and the HUD Contract, as hereby modified and amended by this August 2004 Memorandum, is hereby declared by the City to be enforceable in accordance with it~ terms. Section 9. The Mayor, in consultation with special legal counsel to the City, is hereby authorized and directed to execute such instruments and certificates addressed to HUD as HUD may request in order to implement the provisions of this August 2004 Memorandum. If requested by HUD and approved by the Mayor, special legal counsel to the City is hereby further authorized to submit an approving legal opinion to HUD regarding the matters contemplated under this August 2004 Memorandum. //1 /1/ /1/ 481 ).6764.5184\ 4 ()) THIS AUGUST 2004 MEMORANDUM may be executed m counterparts by the authorized officers of the parties. HUD United States Secretary of the Department of Housing and Urban Development Date: By: CITY City of San Bernardino, California 0\ Date: By: Mayor, City of San Bernardino APPROVED AS TO FORM: S rre'..1 L~~the City o 4813.6764-5184.1 5 , p . CITY OF SAN BERNARDINO Interoffice Memorandum CITY CLERK'S OFFICE Records and Information Management (RIM) Program DATE: August 20, 2004 TO: Wasana Chantha, Acting Secretary FROM: Michelle Taylor, Senior Secretary RE: Transmitting Documents for Signature - Resolution 2004-268 At the Mayor and Common Council meeting of August 16, 2004, the City of San Bernardino adopted Resolution 2004-268 - Resolution approving the August 2004 Amendment to the 2000 Community Development Block Grant Program Section 108 Project Development Loan Agreement, dated September 18, 2000, by and between 303 LLC and the City of San Bernardino. Attached is one (1) original agreement. Please obtain signatures in the appropriate location and return the original agreement to the City Clerk's Office as soon as possible, to my attention. If you have any questions, please do not hesitate to contact me at ext. 3206. Thank you. Michelle Taylor Senior Secretary Date: o edge receipt of the above mentioned documents. Signed: Please sign and return l ~ CITY OF SAN BERNARDINO Interoffice Memorandum CITY CLERK'S OFFICE Records and Information Management (RIM) Program DATE: August 20, 2004 TO: Wasana Chantha, Acting Secretary FROM: Michelle Taylor, Senior Secretary RE: Transmitting Documents for Signature - Resolution CDC/2004-3l At the Mayor and Common Council meeting of August 16, 2004, the City of San Bernardino adopted Resolution CDC/2004-31 - Resolution approving the 2004 Amendment to the 2000 Owner Participation and ED! Loan Agreement and ED! Loan Forbearance Agreement, dated September! 8, 2000, by and between 303 LLC and the Redevelopment Agency of the City of San Bernardino. Attached is one (1) original agreement. Please obtain signatures in the appropriate location and return the original agreement to the City Clerk's Office as soon as possible, to my attention. If you have any questions, please do not hesitate to contact me at ext. 3206. Thank you. Michelle Taylor Senior Secretary I hereby a I dge receipt of the above mentioned documents. ~. Signed: Date: Please sign and return City of San Bernardino ECONOMIC DEVELOPMENT AGENCY Redevelopment. Community Development. Housing. Business: Recruitment, Retention. Revitalization. Main Street, Inc. OM September 24, 2004 F .E. Schnetz Commercial Brokerage 330 North "D" Street, Suite 501 San Bernardino, CA 92401 RE: August 2004 Amendment to the 2000 Community Development Block Grant Program Section 108 Project Development Loan Agreement and August 2004 Amendment to 2000 OPA and EDI Loan Agreement (303, L.L.C., City, and Agency) Dear Frank: Enclosed for your records are two (2) fully executed Agreements referenced above. I have also enclosed, for your records, a copy of the Second Amendment to the Section 108 Contract between the City and HOD. Thank you for your assistance in this matter. If you have any questions, you may contact me at (909) 663-1044. i:;/R~- Maggie Pacheco Deputy Director Enclosures cc: ijarbara Lindseth (with Original Executed Agreements) Michelle Taylor (with Original Executed Agreements) Maggie Pacheco (with Copy of Agreements) File (with Copy of Agreements) P:\C1erica1 Services Dept\Wasana\Lelten'lSept24 Aug.2004 Amend-EMCUled Ur.doc 201 North E Street, Suite 301 . San Bernardino, California 924fJ1-1507. (909) 663-1044 . Fax (909) 866-9413 www.sanbemardino-eda.org. > ** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT ** RESOLUTION AGENDA ITEM TRACKING FORM Meeting Date (Date Adopted): ~ - \ b- C> ~ Item # IZ.A 2. e Resolution # zro4- ?k g Vote: Ayes 1-,/ Nays -cr Abstain -e- Absent ..e- Change to motion to amend original documents 0 Companion Resolutions 2rn"l- 2.10 ( cod ?oo4~ 31 I , NulVVoid After: days I Resolution # On Attachments: 0 PUBLISH 0 POST 0 Note on Resolution of attachment stored separately: 0 RECORD W/COUNTY 0 By: Date Sent to Mayor: 9J - I ~. G~ Date of Mayor's Signature: Date ofClerkfCDC Signature: Reso. Log Updated: Seal Impressed: Q--- o Date MemolLetter Sent for Signature: I" Reminder Letter Sent: ~-ZO-(\ 't Date Returned: q-Ll-O<t Not Returned: 0 2nd Reminder Letter Sent: Request for Council Action & Staff Report Attached: Updated Prior Resolutions (Other Than Below): Updated CITY Personnel Folders (6413,6429,6433, 10584, 10585, 12634): Updated CDC Personnel Folders (5557): Updated Traffic Folders (3985, 8234, 655, 92-389): Yes ./ No Yes No ./ - Yes No v - Yes No v 7 Yes No Copies Distributed to: Animal Control 0 EDA Ia" Information Services 0 City Administrator 0 Facilities 0 Parks & Recreation 0 City Attorney [;1 Finance 0 Police Department 0 Code Compliance 0 Fire Department 0 Public Services 0 Development Services 0 Human Resources 0 Water Department 0 Others: J- Notes: Ready to File: _ Date: Revised 12/18/03 . .. ** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT ** RESOLUTION AGENDA ITEM TRACKING FORM Meeting Date (Date Adopted): 15 . \ lO-<:A Item # Vote: Ayes \- 'I Nays ~ Change to motion to amend original documents D f2.- 4 '2. c... Resolution # ~rcJ7r04-3) , Abstain ~ Companion Resolutions Absent €:r zrotI- Lf" ( --z.m4-"L<:' g I NulIN oid After: - days / - Resolution # On Attachments: D PUBLISH D POST D Note on Resolution of attachment stored separately: D RECORD W/COUNTY D By: Date Sent to Mayor: 'i(- \ 'is' -a4 Date of Mayor's Signature: Date of Clerk/CDC Signature: Reso. Log Updated: --IT Seal Impressed: D x-~o-~4 Date Returned: "\'-<:,-0'1 2nd Reminder Letter Sent: Not Returned: D Date MemolLetter Sent for Signature: I st Reminder Letter Sent: Request for Council Action & Staff Report Attached: Updated Prior Resolutions (Other Than Below): Updated CITY Personnel Folders (6413, 6429, 6433,10584,10585,12634): Updated CDC Personnel Folders (5557): Updated Traffic Folders (3985, 8234, 655, 92-389): Yes ,/' Yes Yes Yes Yes No By_ By B B B No~ No ----L- No~ No / Copies Distributed to: Animal Control D EDA I2r Information Services D City Administrator D Facilities D Parks & Recreation D City Attorney D Finance D Police Department D Code Compliance D Fire Department D Public Services D Development Services D Human Resources D Water Department D Others: Notes: Ready to File: _ Date: Revised 12/18/03