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HomeMy WebLinkAboutR34-Economic Development Agency ECONOMIC DEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO FROM: Maggie Pacheco, Director SUBJECT: Housing and Community Development AD · '" , , . · L April 10, 2001 O,,'U.~, II H.! CONSIDERATION OF A INTERIM FINANCING STRATEGY REGARDING THE DOWNTOWN CINEMA COMPLEX-CENTRAL CITY NORTH REDEVELOPMENT PROJECT AREA DATE: SvnoDsis of Previous Commission/Council/Committee Action(s): On April 5, 200 I, the Redevelopment Committee recommended that this item be sent to the Community Development Commission for approval. Recommended Motion(s): (Mavor and Common Council) MOTION A: That the Mayor and Common Council approve an amendment to the City of San Bernardino 2000-200 I Annual Consolidated Plan authorizing a Community Development Block Grant (CDBG) and Redevelopment Agency $3.6 million Float Loan in conjunction with the Downtown Cinema Complex. (Communitv DeveloDment Commission) MOTION B: RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING FLOAT LOAN AGREEMENT BY AND BETWEEN CITY OF SAN BERNARDINO AND THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO WITH RESPECT TO CINEMASTAR PROPERTY ACQUIRED BY THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO FROM MDA-SAN BERNARDINO ASSOCIATES, L.L.C. (Recommended Motion(s) Continued to Next Pa~e....) ____________________..h_________________._._______________________________._________________________.________________________________________________________________ Contact Person(s): Gary Van OsdellM. Pacheco Phone: 663-1044 Project Area(s) Central City & Central City North Ward(s): Supporting Data Attached: 0 Staff Report 0 Resolution(s) 0 Agreement(s)/Contract(s) 0 Map(s) 0 LetterlMemo FUNDING REQUIREMENTS Amount: $ 3.6M Source: CDBG & RDA Funds SIGNATURE: Budget Authority: ~(?~,.~ Maggie Pac eco, Director Housing and Community Development ._--------------------------.----------------------------------------------------.---------------------------------------------------------------------------. Commission/Council Notes: ----------------------------------------------------------------------------------------------------------------------------------.--------- GVO:lag:04-16-01 Financing Strategy COMMISSION MEETING AGENDA Meeting Date: 04/16/2001 Agenda Item Number: .A 3LJ Request for Commission/Council Action Financing Strategy April 9, 2001 Page Number -2- Recommended Motion(s) Continued: (Community Development Commission) MOTION C: RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO AUTHORIZING DEPOSIT OF CERTAIN FUNDS TO THE CENTRAL CITY NORTH PROJECT AREA AND CENTRAL CITY PROJECT AREA AND RATIFYING THE LOAN OF LOW AND MODERATE INCOME HOUSING FUNDS TO THE SAN BERNARDINO MOBILEHOME PARK CORPORATION (Mavor and Common Council) MOTION D: RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO APPROVING FLOAT LOAN AGREEMENT BY AND BETWEEN CITY OF SAN BERNARDINO AND THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO WITH RESPECT TO CINEMASTAR PROPERTY ACQUIRED BY THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO FROM MDA-SAN BERNARDINO ASSOCIATES, L.L.C. ~~~-~---------------------------._-_._---------------------.---------------------------.---------------------------------------------------- GVO:lag:04-16-01 Financing Strategy COMMISSION MEETING AGENDA Meeting Date: 04/16/2001 Agenda Item Number: ~ ECONOMIC DEVELOPMENT AGENCY STAFF REPORT Cinema Complex - Backl!:round In connection with the construction of the CinemaStar Theater, the Agency loaned to MDA-San Bernardino Associates ("MDA") $7,000,000 pursuant to a 1998 Development Block Grant Program Section 108 Project Development Loan Agreement. The loan is secured by a second deed of trust on the Property. The Agency further made a development cost contribution loan to MDA in the amount of$I,325,575, which is secured by a third deed of trust on the Property. MDA also obtained construction financing in the amount of $3,600,000 from GMAC Commercial Mortgage Corporation, securing its repayment obligation with a first deed of trust on the Property. This construction loan was subsequently refinanced by MDA through a $3,600,000 loan from Gold Mountain Financial Institution, Inc. ("Gold Mountain"). A condition precedent to the refinancing was that the first deed of trust maintain its senior lien status. Per the Subordination and Intercreditor Agreement, the Agency agreed to subordinate the note evidencing the Section 108 Loan and the note evidencing the development cost contribution loan to the $3,600,000 note issued by MDA to Gold Mountain (the "Gold Mountain Note"). The CinemaStar Theater was leased (the "Lease") by MDA to CinemaStar Luxury Theaters, Inc. In October 2000 CinemaStar ceased making rental payments to MDA under the Lease and subsequently filed a voluntary petition for relief under Chapter II of the Bankruptcy Code. In the absence of rental income derived from the Lease, MDA was unable to make further payments on the Gold Mountain Note, the Section 108 Loan and the development cost contribution loan. MDA proposed to sell the Property to the Agency, and the Agency agreed to purchase the Property to maintain the economic viability of the CinemaStar Theater project and to protect the Agency's investment in the project pursuant to its two loans. The sale of the Property to the Agency, including the sale of all ofMDA's right, title and interest as Landlord under the Lease, has occurred. The Agency and CinemaS tar have entered into an amendment to the Lease pursuant to which CinemaStar has agreed to pay annually to the Agency $984,000 as Minimum Annual Rent, in 12 equal monthly installments of $82,000 per month. The Minimum Annual Rent has been calculated to be sufficient to repay (i) the Section 108 Loan and (ii) an indebtedness at zero (Float Loan) interest cost of $3,600,000. The Gold Mountain Note bears interest at the rate of 12%. The Agency desires to acquire the Note to effect an interest cost savings integral to the maintenance of the economic viability of the CinemaStar Theater project and to the repayment of indebtedness associated with the project. See Table below: -.------------------------------------------------------------------------------------------------------------------------------------------ GVO:lag:04-16-0 1 Financing Strategy COMMISSION MEETING AGENDA Meeting Date: 04/16/2001 Agenda Item Number: ~ Economic Development Agency Staff Report Financing Strategy April 9, 2001 Page Number -2- --------------------------------------------------------------------------------------------------------------------- The Agency further desires to borrow $3,600,000 from the City of San Bernardino CDBG Program, administered by the Agency (the "City") for the purpose of acquiring the Gold Mountain Note (the "CDBG" Float Loan). Because the City is the entitlement City for CDBG Funds, the City must loan the Agency the CDBG Funds. This loan from the City will bear no interest. A Float Loan Agreement has been prepared between the City and the Agency and is attached hereto. In entering into a Float Loan, under applicable CDBG regulations, the Agency must promise to transfer funds to the City in the full amount of any shortfall to the CDBG line of credit. Under the Float Loan Agreement, the City may deliver a Notice of Mandatory Prepayment to the Agency in the event of any shortfall, and the Agency agrees to use Agency funds to make the Mandatory Prepayment. Upon the acquisition of the Gold Mountain Note by the Agency, the Agency will endorse and deliver the Gold Mountain Note to the City, as amended and restated to set forth the terms and conditions of the Float Loan Agreement. The City will then be the holder of a first lien on the Property. Below is a summary of current Cinemas tar economics: "Old" "New" MDA Lease RDA Lease Stabilized Net Rent Per Year $1,334,000 $984,000 Operating Expenses $36,000 $36,000 Net Operating Income $1,298,000 $948,000 Debt Service-Private' $518,473 $518,473 Debt Service-I 082 $717,071 $717,071 Cash Flow $62,456 ($287,544) Debt Coverage Ratio 1.05 to 1.00 .77 to 1.00 To reduce the $287,544 per year negative cash flow burden on the City/Agency, the Agency will refinance the $3,600,000 private first trust deed with a CDBG float loan referenced above. This will produce the following cash flow benefits: 1$3,600,000 @ 12% - 15 years 2 $7,000,000 @ average annual debt service for next 5 year per HOD loan repayment schedule. --~----------------------------------------------------------------------------------------------------------------------------------------- GVO:lag:04-16-0 I Financing Strategy COMMISSION MEETING AGENDA Meeting Date: 04/16/2001 Agenda Item Number: lli- Economic Development Agency Staff Report Financing Strategy April 9, 2001 Page Number -3- RDA Lease with Float Fundin $984,000 $36,000 $948,000 $717,071 $230,929 The debt service on the float loan is based on a 0% interest rate and a payment of 100% of net available cash flow beginning in year two. The first year cash flow will be used to pay for project public improvements for lighting, landscaping and signage required adjacent to the downtown cinema. Subsequent year positive cash flow will be used to pay down the Float CDBG Loan. The term of the CDBG Float may be for a period of3-4 years. Justification for CDBG Float Loan - Purpose of Public Hearing/Amendment to the 2000-2001 Annual Consolidated Plan The CDBG Float loan qualifies under federal regulations as a Special Economic Development Activity based upon its resulting public benefits. This provision of assistance (the lease write down) to a for profit business is based upon the Agency's determination that the assistance is both necessary and appropriate to maintain services for low and moderate income residents in the City. The Cineplex project meets the national objective of assisting low and moderate-income residents by providing an area benefit through provision of a service to residents of low and moderate-income census tracts. The complex provides entertainment services to 104,264 individuals in low and moderate-income census tracts. Moreover, the project aids in the prevention and elimination of slums and blight in the downtown by strengthening retail demand in the area and increasing the economic base. The service area for the Cineplex includes the entire population of the City of San Bernardino, which totaled 164,164 in the 1990 census. Within that area there are 104,264 individuals (64%) who are residents of designated low and moderate-income census tracts. Moreover, the area contains 36,174 individuals who are at or below the poverty level (this is 22% of the city's population). Based on 104,264 persons living in low and moderate income census tracts, all HUD loans will total less than $102 per LMI residents served by the complex. This is within the standard of no more than $350 per LMI resident. Finally, the Cineplex currently employs approximately 100 FTE that could be lost to the community. -----------------------.------------------------------------------------------------------------------------------------------------.------- GVO:lag:04-16-01 Financing Strategy COMMISSION MEETING AGENDA Meeting Date: 04/16/2001 Agenda Item Number: .&31.- Economic Development Agency Staff Report Financing Strategy April 9, 2001 Page Number -4- Therefore, the purpose of this CDBG Float Loan is to ensure that the project continues to operate and the investment made by all partners to date is not lost to the Community. The proposal is to replace high-cost, short-term, private financing with low-cost CDBG Float Loan funds so that the City of San Bernardino and the private theater operator can afford to keep the new movie theater operating in an extremely competitive retail theater operating environment. The float financing will save the City/RDA $4,071,885 in out-of-pocket costs over the next 15 years. The City/EDA do not have funds available for this amount of subsidy. Without the float loan over $11,000,000 of public funding, $5,850,000 of private funding, and a valuable community resource may be lost. Based on the preceding analysis the proposed project is an appropriate expenditure of HOD CDBG funding and the Council is being requested to authorize an amendment to the 2000-2001 Annual Consolidated Plan authorizing the CDBG Float Loan. Moreover, given the fact that there are insufficient CDBG funds available in the current line of credit to support the full refinancing or repayment of the $3.6 million 15t Trust Deed, presently estimated at $1 million, in order to assist with the refinancing of the 15t Trust Deed, the Agency will need to supplement CDBG funds with $1.2 million of Agency funds. The remaining $1.4 million will be borrowed from the 2001-2002 CDBG Line of Credit effective July I, 2001. Thus, below is an explanation of how the Agency will obtain the $1.2 million to augment the CDBG funds: San Bernardino Mobile Home Park Corporation - Refinancing Approved bv Community Development Commission on January 5. 2001: In and prior to 1995, the Agency expended Agency funds on behalf of the mobile home park conversion program for (i) the initial analysis of the 44 mobile home parks located in the City, (ii) due diligence investigations, engineering and financial analysis for the converted mobile home parks, (iii) administrative and consultant expenses to implement the program, and (iv) payment of the mobile home park conversion consultant fees and expenses. Eight mobilehome parks (the "Parks") were purchased by the Agency in 1995 and 1996. Upon the creation of the San Bernardino Mobilehome Park Corporation (the "Corporation") and eight subsidiaries thereof representing each park in 1996, the Agency transferred its ownership interest in each park to either the Corporation or its subsidiaries. At closing, the Agency required the Corporation, as controlled by the Agency at such time, to execute eight notes (the "Park Reimbursement Obligations") and eight deeds of trust on the Parks securing the Park Reimbursement Obligations in an attempt to recoup a portion of its expenditures made prior to the sale of the Parks to the Corporation. -------~------------------------------------------------------------------------------------------------------------------------------------ GYO:lag:04-16-0 1 Financing Strategy COMMISSION MEETING AGENDA Meeting Date: 04/16/2001 Agenda Item Number: OC Economic Development Agency Staff Report Financing Strategy April 9, 2001 Page Number -5- The original bonds issued in 1995 and 1996 were refinanced in 1999 with the County of San Bernardino Housing Authority ("County Housing Authority") $27,195,000 mortgage revenue notes (the "1999 Notes"). The County Housing Authority has agreed to assist the Corporation with refinancing a portion of the 1999 Notes and pursuant to that transaction the County Housing Authority has issued GNMA Collateralized bonds (the "Refunding Bonds") for the Rancho Meridian Mobilehome Park and Sequoia Mobilehome Park and intends to issue like bonds for the remaining Parks. The Corporation has agreed to apply a portion of the proceeds of the Refunding Bonds to pay the Park Reimbursement Obligations in full upon the issuance of the Refunding Bonds. On March 12,2001, the Corporation paid the Agency $1,226,169.50 as the initial payment. The monies expended by the Agency prior to 1995 were to cause the acquisition and rehabilitation of the Parks and the transfer of the Parks to a non-profit corporation to maintain occupancy by low- and moderate-income tenants. Those purposes have been satisfied and certain regulatory agreements recorded, or to be recorded, against the Parks restrict certain units to occupancy by low- and moderate-income tenants. Since the purpose of the original Agency expenditures has been satisfied, the proceeds from recoupment ofa portion of those expenditures $1,226,169.50 may now be applied by the Agency to other eligible Agency projects such as repayment of the balance of the I st Trust Deed on the Cinema Complex site. RECOMMENDA TrONS That the Mayor and Common Council and Community Development Commission adopt motions A, B, C, and D. ~-h) . cJ) <U ~D ~ /,,,------, Maggie Pacheco, Director Housing and Community Development GYO:lag:04-16-0 1 Financing Strategy COMMISSION MEETING AGENDA Meeting Date: 04/16/2001 Agenda Item Number: .lli.- I 2 3 4 5 6 7 8 ((;(Q)r?W RESOLUTION NO. RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING FLOAT LOAN AGREEMENT BY AND BETWEEN CITY OF SAN BERNARDINO AND THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO WITH RESPECT TO CINEMASTAR PROPERTY ACQUIRED BY THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO FROM MDA- SAN BERNARDINO ASSOCIATES, L.L.C. 9 WHEREAS, the Redevelopment Agency of the City of San Bernardino (the "Agency") 10 desires to borrow Three Million Six Hundred Thousand Dollars ($3,600,000.00) (the "Loan") from the City of San Bernardino (the "City") for the purpose of acquiring that certain Note II Secured by Deed of Trust executed by MDA-San Bernardino Associates, L.L.C., a Delaware limited liability company ("MDA") in favor of Gold Mountain Financial Institution, Inc., a 12 California corporation ("Gold Mountain") in the original principal amount of Three Million Six 13 Hundred Thousand Dollars ($3,600,000.00)(the "Note"); and 14 WHEREAS, the Note was delivered by MDA to Gold Mountain in connection with the refinancing of a construction loan obtained by MDA from GMAC Commercial Mortgage 15 Corporation to construct an approximately 80,000 square foot multi-screen cinema complex and related common areas (the "Project") on certain real property located in the City of San I (j Bernardino (the "Property"); and 17 WHEREAS, the Note is secured by a first deed of trust on the Property in favor of Gold 18 Mountain (the "Senior Deed of Trust"); and 19 WHEREAS, in connection with the construction of the Project, the Agency loaned to MDA the amount of Seven Million Dollars ($7,000,000.00) pursuant to that certain 1998 20 Community Development Block Grant Program Section 108 Project Development Loan 21 Agreement dated as of December 10, 1998 (the "Section 108 Loan"); and 22 WHEREAS, the Section 108 Loan is secured by a deed of trust on the Property in favor of the Agency (the "Section 108 Deed of Trust"); and 23 WHEREAS, the Agency further made a Project development cost contribution loan to 24 MDA in the amount of One Million Three Hundred Twenty Five Thousand Five Hundred 25 Seventy Five Dollars ($1,325,575.00) (the "Development Cost Contribution Loan"); and 26 27 SB~~ WHEREAS, the Development Cost Contribution Loan is secured by a deed of trust on the Property in favor of the Agency (the "Contribution Loan Deed of Trust"); and 245.1 1 WHEREAS, a condition precedent to the refinancing by Gold Mountain ofthe GMAC 2 Commercial Mortgage Corporation construction loan was that the Senior Deed of Trust constitute a first position lien against the Property prior and superior to the Section 108 Deed of Trust and 3 the Contribution Loan Deed of Trust; and 4 WHEREAS, MDA, Gold Mountain and the Agency entered into that certain Subordination and Intercreditor Agreement dated as of June 6, 2000 (the "Subordination and 5 Intercreditor Agreement"), pursuant to which the Agency agreed to subordinate the note 6 evidencing indebtedness under the Section 108 Loan and the note evidencing indebtedness under the Development Cost Contribution Loan to the Note; and 7 WHEREAS, pursuant to the Subordination and Intercreditor Agreement, the Senior Deed 8 of Trust constitutes a first position lien against the Property; and 9 WHEREAS, the Project was leased to CinemaStar Luxury Theaters, Inc., a California 10 corporation ("CinemaStar") pursuant to that certain Multi-Plex Theater Lease by and between MDA, as Landlord, and CinernaStar dated December 20, 1996 and amended December 10, 1998 11 (the "Lease"); and 12 WHEREAS, in October 2000, CinemaS tar ceased making rental payments to MDA under 13 the Lease and subsequently filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code; and 14 WHEREAS, in the absence of rental income derived from the Lease, MDA was unable 15 to make further payments on the Note and on the Section 108 Loan and the Development Cost Contribution Loan; and 16 17 WHEREAS, MDA proposed to sell the Property to the Agency and the Agency agreed to purchase the Property from MDA in order to maintain the economic viability of the Project and 18 to protect the Agency's investment in the Project pursuant to the Section 108 Loan and the Development Cost Contribution Loan; and 19 WHEREAS, pursuant to a Purchase and Sale Agreement and Joint Escrow Instructions 20 dated February _, 2001 (the "Purchase and Sale Agreement"), MDA sold the Property to the 21 Agency, subject to the Note, the Section 108 Loan and the Development Cost Contribution Loan; and 22 WHEREAS, the sale of the Property pursuant to the Purchase and Sale Agreement 23 included the sale to the Agency of all ofMDA's right, title and interest as Landlord under the 24 Lease; and 25 WHEREAS, the Agency and CinemaS tar subsequently entered into that certain Second Amendment to Multi-Plex Theater Lease dated as of February 26, 2001 (the "Second Lease 26 Amendment"), pursuant to which CinemaStar has agreed to pay annually to the Agency Nine Hundred Eighty Four Thousand Dollars ($984,000.00) as Minimum Annual Rent, until the 27 SB~ 1 245.1 I expiration of the Lease Term (November 26,2018), said Minimum Annual Rent being payable 2 in advance, in twelve (12) equal monthly installments in the amount of Eighty Two Thousand Dollars ($82,000.00) per month; and 3 WHEREAS, the Second Lease Amendment was approved by the bankruptcy court on 4 April_,2001;and 5 WHEREAS, the Minimum Annual Rent payable under the Second Lease Amendment has 6 been calculated to be sufficient to repay (i) the Section 108 Loan and (ii) an indebtedness at zero interest cost of Three Million Six Hundred Thousand Dollars ($3,600,000.00); and 7 8 WHEREAS, the Note bears interest at the rate of twelve percent (\2%) per annum; and WHEREAS, the Agency desires to acquire with Loan proceeds the Note (the "Note 9 Acquisition") and to amend and restate the Note to provide, among other things, that prior to a 10 default on the Note the Note shall bear no interest, in order to effect an interest cost savings integral to the maintenance of the economic viability of the Project and to the repayment of II indebtedness associated with the Project; and 12 WHEREAS, the City desires to make the Loan to the Agency; and 13 WHEREAS, a Float Loan Agreement by and between the City and the Agency (the 14 "Agreement") has been presented to this Commission for its review. 15 NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION ACTING ON BEHALF OF THE REDEVELOPMENT AGENCY OF THE CITY OF SAN 16 BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: 17 The Recitals contained herein are true and correct and incorporated herein Section I. 18 by this reference. 19 Section 2. The Commission hereby approves the Agreement and authorizes and directs the Executive Director to execute the Agreement in substantially the form attached hereto as 20 Exhibit "A", with such changes therein as the Executive Director may determine to be necessary 21 or advisable, the execution of the Agreement by the Executive Director being conclusive evidence of such determination. 22 Section 3. The Executive Director is hereby further authorized and directed to execute 23 such other agreements and documents as may be necessary or advisable to effectuate the 24 provisions of the Agreement, and the Executive Director, the Secretary or Assistant Secretary and such other designated representatives of the Agency are hereby authorized and directed to do any 25 and all things and take any and all actions as may be necessary or advisable to effectuate the provisions of the Agreement. 26 27 SB~1fl 245.1 1 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE 2 CITY OF SAN BERNARDINO APPROVING FLOAT LOAN AGREEMENT BY AND BETWEEN CITY OF SAN BERNARDINO AND THE REDEVELOPMENT AGENCY OF 3 THE CITY OF SAN BERNARDINO WITH RESPECT TO CINEMASTAR PROPERTY ACQUIRED BY THE REDEVELOPMENT AGENCY OF THE CITY OF SAN 4 BERNARDINO FROM MDA-SAN BERNARDINO ASSOCIATES, L.L.C. 5 Section 4. This Resolution shall become effective immediately upon its adoption. 6 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community 7 Development Commission of the City of San Bernardino at a meeting thereof, held on the day of , 200 I, by the following vote, to wit: 8 Commission 9 ESTRADA 10 LIEN McGINNIS 11 SCHNETZ SUAREZ 12 ANDERSON 13 McCAMMACK 14 ]5 NAYS ABSTAIN ABSENT AYES Secretary ]6 ]7 ]8 ]9 20 2] Approved as to form and legal content: The foregoing Resolution is hereby approved this _ day of , 2001. Judith Valles, Chairperson Community Development Commission ofthe City of San Bernardino 22 By: 23 Agency Counsel 24 25 26 27 SB~~ 1 245.1 ] STATEOFCALIFORNIA ) 2 COUNTY OF SAN BERNARDINO) ss CITY OF SAN BERNARDINO ) 3 I, Secretary of the Community Development 4 Commission of the City of San Bernardino, DO HEREBY CERTIFY that the foregoing and attached copy of Community Development Commission of the City of San Bernardino Resolution 5 No. is a full, true and correct copy of that now on file in this office. 6 IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official 7 seal ofthe Community Development Commission ofthe City of San Bernardino this day of ,2001. 8 9 10 11 12 13 14 15 16 ]7 18 19 20 2] 22 23 24 25 26 27 SB2~~ 1 245.1 Secretary of the Community Development Commission of the City of San Bernardino (See Companion Resolutions CDC/200l-l5, 2001-81) <G@~W RESOLUTION NO. CDC/200l-l6 2 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO AUTHORIZING DEPOSIT OF CERTAIN FUNDS TO THE CENTRAL CITY REDEVELOPMENT PROJECT AREA AND AUTHORIZING THE LOAN OF LOW AND MODERATE INCOME HOUSING FUNDS TO THE SAN BERNARDINO MOBILEHOME PARK CORPORATION 3 4 5 6 7 WHEREAS, the Community Development Commission of the City of San Bernardino (the "Commission") is the governing body ofthe Redevelopment Agency of the City 8 of San Bernardino (the "Agency"), a public body corporate and politic, organized and existing 9 pursuant to the Community Redevelopment Law (California Health and Safety Code Section 33000, et sea.); and 10 WHEREAS, the Agency acquired the Tropicana Mobilehome Park, Friendly 1] Village Mobilehome Park, Sequoia Mobilehome Park, Pacific Palms Mobilehome Park, Glen Aire Mobilehome Park, Orangewood Mobilehome Park, Rancho Meridian Mobilehome Park ] 2 and Ninth Street Mobilehome Park (collectively, the "Parks") with funds loaned to the Agency ] 3 from the proceeds ofthe San Bernardino Joint Powers Financing Authority's mortgage revenue bonds (the "Bonds") issued for each park between July, 1995 and March 1996; and ]4 WHEREAS, prior to the purchase of the Parks, the Agency expended Agency 15 funds on behalf of the mobile home park conversion program, without any formal intent or documentation to provide for any reimbursement or recoupment of such expended funds, for (i) ] 6 the initial analysis of the 44 mobile home parks located in the City, (ii) due diligence 17 investigations, engineering and financial analysis for the converted mobile home parks, (iii) administrative and consultant expenses to implement the program, and (iv) payment of the 18 mobile home park conversion consultant fees and expenses; and 19 WHEREAS, in May, 1996, the Agency caused the formation of the San 20 Bernardino Mobilehome Park Corporation (the "Corporation") and eight subsidiaries thereof representing each Park and then transferred its ownership interest in each Park to either the 2] Corporation or its subsidiaries; and 22 WHEREAS, in an attempt to recoup a portion of its expenditures incurred prior to the purchase of the Parks, subsequently authorized Agency officials acting on behalf of the 23 Corporation, as controlled by the Agency at such time, required the Corporation to execute eight 24 (8) notes (the "Park Reimbursement Obligations") and eight (8) deeds oftrust securing the Park Reimbursement Obligations for the benefit of the Agency (the "Deeds of Trust"); and 25 WHEREAS, in connection with the issuance by the County of San Bernardino 26 Housing Authority ("County Housing Authority") of its $27,195,000 mortgage revenue notes (the "1999 Notes"), the Agency reconveyed the Deeds of Trust upon receipt ofa new deed of 27 LA~W 7367.2 - 4/6/01 CDC/2001-16 1 trust securing the Park Reimbursement Obligations, which new deed of trust was not to be 2 recorded against the respective Parks unless and until the 1999 Notes and any bonds refunding said 1999 Notes had been paid in full; and 3 WHEREAS, the County Housing Authority has agreed to assist the Corporation 4 with refinancing a portion of the 1999 Notes and pursuant to that transaction, the County Housing Authority has issued GNMA Collateralized bonds ("Refunding Bonds") for the Rancho 5 Meridian Mobilehome Park and Sequoia Mobilehome Park, and intends to issue like bonds for 6 the remaining Parks; and i WHEREAS, the Corporation will apply a portion of the proceeds of the Refunding Bonds to pay the Park Reimbursement Obligations in full upon the issuance of the 8 Refunding Bonds; and 9 WHEREAS, the purpose of the expenditures made by the Agency prior to the 10 transfer of the Parks to the Corporation has been satisfied, as the Parks have been acquired, partially rehabilitated, and transferred to a non-profit corporation which is organized to ensure 11 the Parks are reserved for low- and moderate-income tenants; and 12 WHEREAS, since the purpose of the Agency's original expenditures have been 13 satisfied, the proceeds of recoupment of said expenditures as may be received by the Agency upon the closing from time to time of the Refunding Bonds, as well as the portion of said 14 proceeds received by the Agency on March 14, 200 I in connection with the closing of the Refunding Bonds for the Rancho Meridian Mobilehome Park and Sequoia Plaza Mobilehome ] 5 Park (the "initial payment"), may be applied to other eligible Agency activities; and ]6 WHEREAS, the Agency desires to apply the initial payment received on March Ii 14,2001 to the Central City Redevelopment Project Area; and ] 8 WHEREAS, the Agency desires to assist the Corporation with the further financing and rehabilitation of the Parks, and thus has entered into that certain 2001 Loan ]9 Agreement (the "2001 Loan Agreement") with the Corporation and has agreed to loan not to 20 exceed $4,187,296 to the Corporation from low- and moderate-income housing funds of the Agency; and 2] WHEREAS, the 200 I Loan Agreement is evidenced by the 200 1 Note (the "200 I 22 Note") and secured by the 2001 Agency Subordinate Regulatory Agreement (the "Agency Subordinate Regulatory Agreement"); and 23 24 WHEREAS, the Agency transferred $1 ,226, 169.50 to the Corporation on March 12,200 I, as an initial loan under the 2001 Loan Agreement, substantially in accordance with the 25 purpose and intent of the Commission action taken on January 8, 2001; and 26 27 LA~'II 7367.2 - 4/6/0 I 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 CDCj2001-16 2 WHEREAS, the Agency expects to loan additional amounts to the Corporation to assist the Corporation with additional financing of the Parks and seeks to ratify the initial loan on March 12,2001, and authorize future loans at this time. NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION ACTING ON BEHALF OF THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. The Recitals contained herein are true and correct and incorporated herein by this reference. Section 2. The Agency hereby authorizes the 2001 Loan Agreement and ratifies the loanof$I,226,169.50 on March 12,2001 to the Corporation as the initial loan under the 2001 Loan Agreement and acknowledges that the intent of such loan is substantially similar to the prior action taken by the Commission on January 8, 2001. Section 3. The Agency acknowledges that the purpose of the Agency's original expenditures has been satisfied by the acquisition, rehabilitation and transfer of the Parks to the Corporation. Thus, the Agency authorizes the transfer of the initial recoupment payment received on March 14,2001, to the funds held for the Central City Redevelopment Project Area for redevelopment purposes therein. The Agency further authorizes the use of subsequent recoupment payments for any and all lawful redevelopment purposes of the Agency. The Commission action as previously taken on January 8, 2001, shall remain in full force and effect for the purpose of accomplishing the refinancing of any and all of the remaining Parks. Section 4. The Executive Director and the Secretary or Assistant Secretary of the Agency, or such other designated representatives of the Agency are further authorized to do any and all things and take any and all actions as may be deemed necessary or advisable to effectuate the purposes of this Resolution and the 2001 Loan Agreement. The Executive Director is further authorized and directed to duly note on the records of the Agency that the Park Reimbursement Obligations shall be considered to be extinguished in whole and to be of no further force and effect for any purposes and in accordance with accepted municipal accounting principles. L~ ' 7367.2-4/6/01 3 CDC/2001-16 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE 2 CITY OF SAN BERNARDINO AUTHORIZING DEPOSIT OF CERTAIN FUNDS TO THE CENTRAL CITY NORTH AND CENTRAL CITY PROJECT AREAS AND 3 RATIFYING THE LOAN OF LOW AND MODERATE INCOME HOUSING FUNDS TO THE SAN BERNARDINO MOBILEHOME PARK CORPORATION 4 5 6 adoption. 7 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community Development Commission of the City of San Bernardino at a ioint regular 8 _ meeting thereof, held on the 16th day of April, 2001, by the following vote, to wit: 9 Section 5. This Resolution shall become effective immediately upon its 10 Commission ESTRADA 11 LIEN McGINNIS 12 SCHNETZ SUAREZ 13 ANDERSON 14 McCAMMACK 15 16 17 AYES X X X X X NAYS ABSTAIN ABSENT X X The foregoing Resolution is hereby approved this 1 q 1'- day of April , 2001. 18 I ) \ '/;' . "- .'i " " .'7. /'.,~~.( L~"-- Juprth;V alles, Chairperson lomf/lunity Development Commission coflh'e City of San Bernardino 19 20 21 22 Approved as to form and legal content: 23 ~ 24 By: \~" Agenc ounsel 25 5p<<'Ci~ 26 27 LA~~I 7367.2 - 4/6/01 4 1 STATE OF CALIFORNIA ) 2 COUNTY OF SAN BERNARDINO) ss CITY OF SAN BERNARDINO ) 3 I, Secretary of the Community Development 4 Commission of the City of San Bernardino, DO HEREBY CERTIFY that the foregoing and attached copy of Community Development Commission of the City of San Bernardino 5 Resolution No. is a full, true and correct copy of that now on file in this office. 6 IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official 7 seal ofthe Community Development Commission of the City of San Bernardino this day of ,2001. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 LAt2~1 7367.2 - 4/6/01 Secretary of the Community Development Commission of the City of San Bernardino 5 I 2 3 4 5 6 7 8 ~(Q)[?W RESOLUTION NO. RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO APPROVING FLOAT LOAN AGREEMENT BY AND BETWEEN CITY OF SAN BERNARDINO AND THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO WITH RESPECT TO CINEMASTAR PROPERTY ACQUIRED BY THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO FROM MDA-SAN BERNARDINO ASSOCIATES, L.L.C. WHEREAS, the Redevelopment Agency of the City of San Bernardino (the "Agency") 9 desires to borrow Three Million Six Hundred Thousand Dollars ($3,600,000.00) (the "Loan") from 10 the City of San Bernardino (the "City") for the purpose of acquiring that certain Note Secured by Deed of Trust executed by MDA-San Bernardino Associates, L.L.C., a Delaware limited liability II company ("MDA") in favor of Gold Mountain Financial Institution, Inc., a California corporation ("Gold Mountain") in the original principal amount of Three Million Six Hundred Thousand 12 Dollars ($3,600,000.00)(the "Note"); and 13 WHEREAS, the Note was delivered by MDA to Gold Mountain in connection with the 14 refinancing of a construction loan obtained by MDA from GMAC Commercial Mortgage Corporation to construct an approximately 80,000 square foot multi-screen cinema complex and 15 related common areas (the "Project") on certain real property located in the City of San Bernardino (the "Property"); and 16 17 WHEREAS, the Note is secured by a first deed of trust on the Property in favor of Gold Mountain (the "Senior Deed of Trust"); and 18 WHEREAS, in connection with the construction of the Project, the Agency loaned to MDA 19 the amount of Seven Million Dollars ($7,000,000.00) pursuant to that certain 1998 Community Development Block Grant Program Section 108 Project Development Loan Agreement dated as 20 of December 10, 1998 (the "Section 108 Loan"); and 21 WHEREAS, the Agency further made a Project development cost contribution loan to 22 MDA in the amount of One Million Three Hundred Twenty Five Thousand Five Hundred Seventy Five Dollars ($1,325,575.00) (the "Development Cost Contribution Loan"); and 23 WHEREAS, the Project was leased to CinemaStar Luxury Theaters, Inc., a California 24 corporation ("CinemaStar") pursuant to that certain Multi-Plex Theater Lease by and between 25 MDA, as Landlord, and CinemaStar dated December 20, 1996 and amended December 10, 1998 (the "Lease"); and 26 27 SB~~ I 247.1 I WHEREAS, in October 2000, CinemaStar ceased making rental payments to MDA under 2 the Lease and subsequently filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code; and 3 WHEREAS, in the absence of rental income derived from the Lease, MDA was unable to 4 make further payments on the Note and on the Section 108 Loan and the Devdopment Cost Contribution Loan; and 5 6 WHEREAS, MDA proposed to sell the Property to the Agency and the Agency agreed to purchase the Property from MDA in order to maintain the economic viability of the Project and 7 to protect the Agency's investment in the Project pursuant to the Section 108 Loan and the Development Cost Contribution Loan; and 8 WHEREAS, pursuant to a Purchase and Sale Agreement and Joint Escrow Instructions 9 dated February _,2001 (the "Purchase and Sale Agreement"), MDA sold the Property to the 10 Agency, subject to the Note, the Section 108 Loan and the Development Cost Contribution Loan; and 11 WHEREAS, the sale of the Property pursuant to the Purchase and Sale Agreement 12 included the sale to the Agency of all ofMDA's right, title and interest as Landlord under the Lease; and 13 14 WHEREAS, the Agency and CinemaS tar subsequently entered into that certain Second Amendment to Multi-Plex Theater Lease dated as of February 26, 2001 (the "Second Lease 15 Amendment"), pursuant to which CinemaS tar has agreed to pay annually to the Agency Nine Hundred Eighty Four Thousand Dollars ($984,000.00) as Minimum Annual Rent, until the 16 expiration of the Lease Term (November 26,2018), said Minimum Annual Rent being payable 17 in advance, in twelve (12) equal monthly installments in the amount of Eighty Two Thousand Dollars ($82,000.00) per month; and 18 WHEREAS, the Second Lease Amendment was approved by the bankruptcy court on April 19 _,2001; and 20 WHEREAS, the Minimum Annual Rent payable under the Second Lease Amendment has 21 been calculated to be sufficient to repay (i) the Section 108 Loan and (ii) an indebtedness at zero interest cost of Three Million Six Hundred Thousand Dollars ($3,600,000.00); and 22 23 WHEREAS, the Note bears interest at the rate of twelve percent (12%) per annum; and WHEREAS, the Agency desires to acquire with Loan proceeds the Note (the "Note 24 Acquisition") and to amend and restate the Note to provide, among other things, that prior to a 25 default on the Note the Note shall bear no interest, in order to effect an interest cost savings integral to the maintenance of the economic viability of the Project and to the repayment of 26 indebtedness associated with the Project; and 27 SB~W 1 247.1 1 WHEREAS, the City has entered into an agreement with the United States of America 2 through its Department of Housing and Urban Development ("HUD") to execute a Community Development Block Grant ("CDBG") pursuant to the Housing and Community Development Act 3 of 1974, as amended (the "Act"); and 4 WHEREAS, the City desires to make the Loan to the Agency out ofCDBG monies; and 5 WHEREAS, a Float Loan Agreement by and between the City and the Agency (the 6 "Agreement") has been presented to the Mayor and Common Council for their review. 7 NOW, THEREFORE, THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: 8 9 Section I. The Recitals contained herein are true and correct and incorporated herein by this reference. 10 Section 2. The Mayor and Common Council hereby determine that maintenance of the II economic viability of the Project and repayment of the indebtedness associated with the Project, an integral part of which is the Note Acquisition, qualifies under HUD Regulations as a special 12 economic development activity based upon the resulting public benefits. The Project meets the 13 national objective of assisting low and moderate income residents by providing an area benefit through provision of a service to residents oflow and moderate income census tracts. The Project 14 will provide entertainment services to over 104,000 individuals in low and moderate income census tracts. Further, the Project provides jobs to approximately one hundred (100) full time 15 employees. 16 Section 3. The Mayor and Common Council hereby approve the Agreement and the 17 execution thereof in substantially the form attached hereto as Exhibit "A", with such changes therein as the Mayor may determine to be necessary or advisable, the execution of the Agreement 18 by the Mayor being conclusive evidence of such determination. 19 .20 Section 3. City Staff is hereby further authorized and directed to do any and all things and take any and all actions as may be necessary or advisable to effectuate the provisions of the Agreement. 21 IIII 22 IIII 23 IIII 24 IIII 25 IIII 26 27 SB~~ 0247.1 I RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN 2 BERNARDINO APPROVING FLOAT LOAN AGREEMENT BY AND BETWEEN CITY OF SAN BERNARDINO AND THE REDEVELOPMENT AGENCY OF THE CITY OF 3 SAN BERNARDINO WITH RESPECT TO CINEMASTAR PROPERTY ACQUIRED BY THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO FROM 4 MDA-SAN BERNARDINO ASSOCIATES, L.L.C. 5 Section 4. This Resolution shall become effective immediately upon its adoption. I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and 7 Common Council of the City of San Bernardino at a meeting thereof, held on the day of ,2001, by the following vote, to wit: 8 6 Commission 9 ESTRADA 10 LIEN McGINNIS II SCHNETZ SUAREZ 12 ANDERSON 13 McCAMMACK 14 15 16 17 18 19 AYES NAYS ABSTAIN ABSENT City Clerk The foregoing Resolution is hereby approved this _ day of , 2001. Judith Valles, Mayor Approved as to form 20 and legal content: 21 By: 22 23 24 25 26 27 SB~I 247.1 City Attorney 1--- 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 SB~~ 1 247.1 I STATE OF CALIFORNIA ) 2 COUNTY OF SAN BERNARDINO) ss CITY OF SAN BERNARDINO ) 3 I, City Clerk of the City of San Bernardino, DO 4 HEREBY CERTIFY that the foregoing and attached copy of Mayor and Common Council of the City of San Bernardino Resolution No. is a full, true and correct copy of that now on 5 file in this office. 6 IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official 7 seal of the Mayor and Common Council of the City of San Bernardino this day of , 2001. City Clerk e e e FLOAT LOAN AGREEMENT (Redevelopment Agency of the City of San Bernardino) THIS FLOAT LOAN AGREEMENT dated as of , 2001 (the "Agreement" ) is entered into by and between the CITY OF SAN BERNARDINO, a municipal corporation (the "City") and the REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO, a public body corporate and politic (the "Agency"). The City and the Agency are sometimes hereinafter referred to as a "Party" and collectively as the "Parties". R E C I TAL S A. WHEREAS, the City has entered into an agreement with the United States of America through its Department of Housing and Urban Development ("HUO") to execute a Community Development Block Grant ("CDBG") pursuant to the Housing and Community Development Act of 1974, as amended (the "Act"); and B. WHEREAS, the Agency desires to borrow Three Million Six Hundred Thousand Dollars ($3,600,000.00) (the "Loan") from the City for the purpose of acquiring that certain Note Secured by Deed of Trust executed by MDA-San Bernardino Associates, L.L.C., a Delaware limited liability company ("MDA") in favor of Gold Mountain Financial Institution, Inc., a California corporation ("Gold Mountain") in the original principal amount of Three Million Six Hundred Thousand Dollars ($3,600,000.00) (the "Note"); and C. WHEREAS, the Note was delivered by MDA to Gold Mountain in connection with the refinancing of a construction loan obtained by MDA from GMAC Commercial Mortgage Corporation to construct an approximately 80,000 square foot multi-screen cinema complex and related common areas (the "Project") on certain real property located in the City of San Bernardino (the "Property"); and D. WHEREAS, the Note is secured by a first deed of trust on the Property in favor of Gold Mountain (the "Senior Deed of Trust"); and E. WHEREAS, in connection with the construction of the proj ect, the Agency loaned to MDA the amount of Seven Million Dollars ($7,000,000.00) pursuant to that certain 1998 Community Development Block Grant Program Section 108 Project Development 882001:9949.1 1 e e e Loan Agreement dated as of December 10, 1998 (the "Section 108 Loan"); and F. WHEREAS, the Section 108 Loan is secured by a deed of trust on the Property in favor of the Agency (the "Section 108 Deed of Trust"); and G. WHEREAS, the Agency further made a Project development cost contribution loan to MDA in the amount of One Million Three Hundred Twenty Five Thousand Five Hundred Seventy Five Dollars ($1,325,575.00) (the "Development Cost Contribution Loan"); and H. WHEREAS, the Development Cost Contribution Loan is secured by a deed of trust on the Property in favor of the Agency (the "Contribution Loan Deed of Trust"); and I. WHEREAS, a condition precedent to the refinancing by Gold Mountain of the GMAC Commercial Mortgage Corporation construction loan was that the Senior Deed of Trust constitute a first position lien against the Property prior and superior to the Section 108 Deed of Trust and the Contribution Loan Deed of Trust; and J. WHEREAS, MDA, Gold Mountain and the Agency entered into that certain Subordination and Intercreditor Agreement dated as of June 6, 2000 (the "Subordination and Intercreditor Agreement"), pursuant to which the Agency agreed to subordinate the note evidencing indebtedness under the Section 108 Loan and the note evidencing indebtedness under the Development Cost Contribution Loan to the Note; and K. WHEREAS, pursuant to the Subordination and Intercreditor Agreement, the Senior Deed of Trust constitutes a first position lien against the Property; and L. WHEREAS, the Project was leased to CinemaStar Luxury Theaters, Inc., a California corporation ("CinemaStar") pursuant to that certain Multi-Plex Theater Lease by and between MDA, as Landlord, and CinemaStar dated December 20, 1996 and amended December 10, 1998 (the "Lease"); and M. WHEREAS, in October 2000, CinemaStar ceased making rental payments to MDA under the Lease and subsequently filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code; and SB2001:9949.1 2 tit e . N. WHEREAS, iri the absence of rental income derived from the Lease, MDA was unable to make further payments on the Note and on the Section 108 Loan and the Development Cost Contribution Loan, and o. WHEREAS, MDA proposed to sell the Property to the Agency and the Agency agreed to purchase the Property from MDA in order to maintain the economic viability of the Project and to protect the Agency's investment in the Project pursuant to the Section 108 Loan and the Development Cost Contribution Loan, and P. WHEREAS, pursuant to a Purchase and Sale Agreement and Joint Escrow Instructions dated February __, 2001 (the "Purchase and Sale Agreement"), MDA sold the Property to the Agency, subject to the Note, the Section 108 Loan and the Development Cost Contribution Loan, and Q. WHEREAS, the sale of the Property pursuant to the Purchase and Sale Agreement included the sale to the Agency of all of MDA'sright, title and interest as Landlord under the Lease, and R. WHEREAS, the Agency and CinemaS tar subsequently entered into that certain Second Amendment to Multi-Plex Theater Lease dated as of February 26, 2001 (the "Second Lease Amendment"), pursuant to which CinemaStar has agreed to pay annually to the Agency Nine Hundred Eighty Four Thousand Dollars ($984,000.00) as Minimum Annual Rent, until the expiration of the Lease Term (November 26, 2018), said Minimum Annual Rent being payable in advance, in twelve (12) equal monthly installments in the amount of Eighty Two Thousand Dollar ($82,000.00) per month, and S. WHEREAS, the Second Lease Amendment was approved by the bankruptcy court on April _, 2001; and T. WHEREAS, the Minimum Annual Rent payable under the Second Lease Amendment has been calculated to be sufficient to repay (i) the Section 108 Loan and (ii) an indebtedness at zero interest cost of Three Million Six Hundred Thousand Dollars ($3,600,000.00), and u. WHEREAS, the Note bears interest at the rate of twelve percent (12%) per annum, and v. WHEREAS, the Agency desires the Note (the "Note Acquisition") savings integral to the maintenance to acquire with Loan proceeds to effect an interest cost of the economic viability of 882001:9949.1 3 e tit tit 2. The Agency shall cause Gold Mountain to deposit into Escrow (a) the Note, showing endorsement by Gold Mountain to the Agency, and (b) an assignment to the Agency, substantially in the form attached hereto as Exhibit "A", of its beneficial interest under the Senior Deed of Trust (the "Gold Mountain Assignment of Deed of Trust") . 3. The Agency shall (a) endorse the Note to the City and (b) deposit into Escrow an assignment to the City, substantially in the form attached hereto as Exhibit "B", of its beneficial interest under the Senior Deed of Trust (the "Agency Assignment of Deed of Trust") . 4. The Escrow Holder shall cause to be recorded in the Office of the County Recorder of the County of San Bernardino, first, the Gold Mountain Assignment of Deed of Trust and second, the Agency Assignment of Deed of Trust. 5. Escrow-related transaction expenses or escrow closing costs incurred by the Escrow Holder in connection with this transaction shall be paid for by the Agency. C. The City and the Agency agree that the Note shall be amended and restated to set forth the terms and conditions of the Loan. The amended and restated Note shall provide, among other things, that, so long as there is no default under the Note, the Note shall bear no interest. The City and the Agency agree that the principal amount of the Note ($3,600,000.00) shall not be increased. D. The Loan proceeds may not be used for, and the Agency hereby covenants that it shall not use such proceeds for, any ineligible purchases and expenditures, as set forth in 24 CFR 570.207. In no event shall the Agency use or otherwise invest the proceeds of the Loan, except as expressly authorized in this Agreement. 2. MATURITY DATES: TERM Upon delivery of the Note to the City, the City shall insert the "Initial Maturity Date", which is the date that is two and a half (2 *) years from the date of the City's receipt of the Note. The Note may be renewed by the City at its option in two and a half (2 * ) year intervals for a total term of the Note not to exceed twelve and a half (12 *) years. The option of the City to renew 582001:9949.1 5 . e e the Note shall be exercised by and in the sole discretion of the Executive Director of the Economic Development Agency of the City (the "Executive Director") and only upon a determination by the Executive Director that sufficient CDBG funds are available to the City to fund disbursements under the Note in addition to the other CDBG eligible activities of the City during any such optional renewal period. Such determinations shall be made by the Executive Director at least ninety (90) days prior to the Applicable Maturity Date (as defined below). If the City elects to renew this Promissory Note upon the expiration of the Initial Maturity Date, this Promissory Note shall, then, mature on ,200 (the "First Optional Maturity Date"). If the City elects to renew this Promissory Note upon the expiration of the First Optional Maturity Date, this Promissory Note shall, then, mature on , 200 (the "Second Optional Maturity Date"). If the City elects to renew this Promissory Note upon the expiration of the Second Optional Maturity Date, this Promissory Note shall, then, mature on , 20__ (the "Third Optional Maturity Date"). If the City elects to renew this Promissory Note upon the expiration of the Third Optional Maturity Date, this Promissory Note shall, then, mature on , 20__ (the "Fourth Optional Maturity Date") . The Initial Maturity Date, the First Optional Maturity Date, the Second Optional Maturity Date, the Third Optional Maturity Date and the Fourth Optional Maturity Date are, collectively, referred to herein as the "Applicable Maturity Date." On the Applicable Maturity Date, the entire unpaid principal balance of the Loan, and any other amounts payable by the Agency under the terms of this Agreement and the Note shall be due and payable. All payments, including any prepayments .or funds received upon acceleration pursuant to Section 3 below, shall be applied first toward costs of collection and default interest charges, if any, then toward the unpaid principal balance under the Note. As used herein, the word "Term" shall mean the period of time commencing with the date of the Note and terminating on the date when the Agency has repaid the entire outstanding principal balance (and accrued interest, if applicable) on the Loan. 3. ACCELERATION. The entire principal balance of the Loan shall I;:>e due and payable on the Applicable Maturity Date; provided, however, that the entire principal balance of the Loan, at the election of the City and upon notice to the Agency thereof (except with respect to Non-Curable Defaults as defined in Section 13 (A) (1) below, as to which no notice is required), shall become immediately due and SB2001:9949.1 6 e e e 5 . SOURCES OF PAYMENT: SECURITY FOR THE LOAN. Except for Mandatory Prepayments, the Note shall be payable from rent payments received by the Agency from CinemaStar pursuant to the Second Lease Amendment and remaining after application of such rent payments to the Section 108 Loan in accordance with the terms of the Section 108 Loan, and from other revenues of the Agency available therefor. Mandatory Prepayments shall be payable from the general fund of the Agency. Upon receipt of a Notice of Mandatory Prepayment, and in the case of each such receipt, the Agency shall, in accordance with 24 CFR Section 570.301(b) (4) (iii), transfer monies in the amount of the Mandatory Prepayment as set forth in the Notice of Mandatory Prepayment from the general fund of the Agency to the City on or before the Mandatory Prepayment Date stated in the Notice of Mandatory Prepayment. The Loan is secured by the Senior Deed of Trust, which constitutes a first lien on the Property. 6. CONDITIONS TO THE CITY FUNDING THE LOAN. The obligation of the City to make any disbursement of Loan proceeds under this Agreement shall be expressly subject to the following conditions: A. The execution of this Agreement by the authorized officer officers of the City and the Agency. B. The availability to the City of allocated but undrawn CDBG funds in an amount sufficient to fund the Loan. C. by Gold City. The deposit into Escrow of the Note, showing endorsement Mountain to the Agency and endorsement by the Agency to the D. The deposit into Escrow of the executed Gold Mountain Assignment of Deed of Trust and the executed Agency Assignment of Deed of Trust. E. Receipt by the City from the Agency of such documents, certifications and opinions of legal counsel to the Agency as are reasonably required by the City, in form and substance satisfactory to the City, evidencing (i) that this Agreement, the Note and all 882001:9949.1 8 e e e other documents given or executed or endorsed by the Agency in connection herewith are duly and validly executed or endorsed by and on behalf of and constitute the valid and enforceable obligation of the Agency thereunder, pursuant to the respective terms of each of such documents, and (ii) that the execution and delivery of this Agreement and all other documents executed, or given hereunder or in connection herewith and the endorsement and delivery of the Note, and the performance by the Agency under this Agreement and the Note, will not breach or violate any agreement to which the Agency is a party or violate any law or governmental regulation nor, to the best of the Agency's knowledge, constitute a breach of or default under any instrument or agreement to which the Agency may be a party, and (iii) such other matters as are reasonably required by the City. F. If necessary, receipt of environmental clearance for the Note Acquisition. G. No uncured Event of Default shall have occurred. 7. OBLIGATION OF AGENCY UNCONDITIONAL. The obligation of the Agency to repay the Loan (and all accrued interest thereon, if applicable) shall be absolute and unconditional, and until such time as all of the outstanding principal of (and interest on, if applicable) the Note shall have been fully paid, the Agency agrees that it: A. will use Loan proceeds solely for the purpose set forth in this Agreement; and B. will not terminate or suspend any payment or obligations under this Agreement, the Note or any other document executed or endorsed hereunder or in connection herewith for any cause, including without limitation, any acts or circumstances that may constitute failure of consideration, commercial frustration of purpose, or any duty, liability or obligation arising out of or in connection with this Agreement or any document executed or endorsed hereunder or in connection herewith. 5B2001:9949.1 9 e e e 8 . ADDITIONAL COVENANTS OF AGENCY. A. Comoliance with Laws. As additional consideration for the making of the Loan by the City, the Agency covenants that the Agency shall, during the Term, comply with all applicable federal, state, and local laws, ordinances, regulations and directives as they pertain to the performance of this Agreement. This Agreement is subject to and incorporates the terms of the Act and 24 Code of Federal Regulations, Chapter V, Part 570, and all amendments or successor laws, regulations or guidelines thereto (collectively, the "Laws, Regulations and Guidelines"). The Agency understands that the Note Acquisition must comply at all times during the Term with one or more of the three broad national objectives set forth in 24 CFR 570.208 and the Agency covenants that it will cooperate with the City and HUD, as reasonably necessary, to maintain compliance therewith. B. Covenant to Perform Services. The Agency shall, during the Term, perform services consistent with the goals and objectives set forth in the City of San Bernardino Community Development Block Grant Statement of Objectives and Projected Use of Funds, as adopted during the Term by the Mayor and Common Council of the City of San Bernardino, which Statement is incorporated herein by this reference. C. Audit bv State and Federal Aaencies. The Agency agrees that in the event this Agreement or the Loan is subjected to audit, monitoring or other inspections by appropriate state and federal agencies, it shall be responsible for complying with such inspections and paying, on behalf of itself and the City, the full amount of the liability to the funding agency resulting from such inspections in the event such liability results from a failure by the Agency to satisfy applicable law or its obligations under this Agreement. D. Hazardous Materials. The Agency covenants and agrees that, during its ownership of the Project and the land on which the Project is situated (the "Site"), it shall not (i) deposit "Hazardous Materials" (as defined below) in, on or upon the Site, or (ii) knowingly permit the deposit of Hazardous Materials in, on or upon the Site, and the Agency hereby assumes any and all liability arising in connection with any such deposit of Hazardous Materi~ls; provided, that this sentence shall not be construed or understood to prohibit the Agency from allowing Hazardous Materials to be brought upon the Site so long as they are materials which are 582001:9949.1 10 e e e customary and common to the normal course of business on the Site so long as such materials are used, stored and disposed of in accordance with all applicable governmental restrictions. The Agency agrees to indemnify, defend and hold the City harmless from and against any Claims respecting the presence of Eazardous Materials in, on or upon the Site to the extent such Hazardous Materials are brought thereon by or on behalf of the Agency, its employees, agents or contractors. For purposes of this Agreement, the term "Hazardous Materials" means, without limitation, gasoline, petroleum products , explosives , radioactive materials, hazardous materials, hazardous wastes, hazardous or toxic substances, polychlorinated biphenyls or related or similar materials, asbestos or any other substance or material as may now or hereafter be defined as a hazardous or toxic substance by any federal, state or local environmental law, ordinance, rule or regulation, including, without limitation, (i) the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act (42 V.S.C. Section 6901, et sea.), (ii) the Federal Water Pollution Control Act (33 V.S.C. Section 1251, et sea.), (iii) the Clean Air Act (42 V.S.C. Section 7401, et ~.), (iv) the Resource Conservation and Recovery Act, as amended by the Hazardous and Solid Waste Amendments of 1984 (42 V.S.C. Section 6902, et sea.), (v) the Toxic Substances Control Act (15 V.S.C. Section 2601-2629), (vi) the Hazardous Materials Transportation Act (49 V.S.C. Section 1801, et sea.), (vii) the Carpenter-Presley Tanner Hazardous Substance Account Act (CA Health & Safety Code Section 25300, et sea.), (viii) the Hazardous Waste Control Law (CA Health & Safety Code Section 25100, et sea.), (ix) the Porter Cologne Water Quality Control Act (CA Water Code Section 13000, et sea.), (x) the Safe Drinking Water and Toxic Enforcement Act of 1986, (xi) the Hazardous Materials Release Response Plans and Inventory (CA Health & Safety Code Section 25500, et sea.), (xii) the Air Resources Law (CA Health & Safety Code Section 39000, et sea.), or (xiii) in any of the regulations adopted and publications; promulgated pursuant to the foregoing. E. Other Reauirements. The Agency shall, during the Term, comply with all other applicable requirements of a subrecipient of CDBG funds including without limitation compliance wi th the Lead Based Paint Poisoning Prevention Act {42 V. S. C. 8B2001:9949.1 11 I e e e 4831(b)), and any other applicable laws including any laws respecting relocation, displacement and federal labor standards requirements. 9. DISCRIMINATION. The Agency and the City agree that no person shall, on the grounds of race, sex, creed, color, religion, national origin, or age be excluded from participation in, be refused the benefits of, or otherwise be subjected to discrimination in any activities, programs, or employment supported by this Agreement. The Agency shall comply with all applicable regulations set forth in 24 CFR 570.600-602, including without limitation, the requirement that the Agency comply with Title VI of the Civil Rights Act of 1964 (Public Law 88-352) and regulations at 24 CFR Part 1; Section 109 of the Act and the Age Discrimination Act of 1975 (42 U.S.C. 6101-07) and Executive Order 11246 and the regulations issued pursuant thereto (41 CFR Chapter 60), if applicable; and the requirements of the Americans With Disabilities Act (42 U.S.C. 12101-12213). 10. INDEPENDENCE OF PARTIES. In their performance of this Agreement, the Parties will be acting in an independent capacity and not as agents, employees, partners, j oint venturers, or associates of one another. The employees or agents of one Party shall not be deemed or construed to be the agents or employees of the other Party for any purpose whatsoever, including workers' compensation liability. 11. ASSIGNMENT; ACCELERATION. Notwithstanding anything which may be or appear to be herein to the contrary, no purported assignment of this Agreement shall be effective if such assignment would violate the terms, conditions and restrictions of the CDBG or any other Laws, Regulations and Guidelines applicable to this Agreement or such assignment. The Agency shall not assign this Agreement or any performance or benefit under the terms of this Agreement, without the prior written consent of the City, and any purported assignm~nt hereof shall be null and void and shall constitute a material breach of this Agreement. In the event of a sale or transfer of the Property and/or the Project (other than an encumbrance of the Property and/or the Project for security purposes) without an assignment of this Agreement approved in writing by the City, the City may, at 582001:9949.1 12 e e e its option, declare the entire principal balance of the Loan and all accrued and unpaid interest thereon immediately due and payable. 12. FISCAL LIMITATIONS. The United States of America through HUD, may in the future place programmatic or fiscal limitations on CDBG funds not presently anticipated. Accordingly, the City reserves the right to revise this Agreement in order to take account of federal government actions affecting HUD program funding. In the event of funding reduction in CDBG funds to such a level that materially affects the ongoing CDBG activities of the City, the City may reduce or eliminate, as necessary, the Loan in whole or in part. 13. EVENTS OF DEFAULT AND REMEDIES. A. Events of Default. The occurrence of any of the following shall, after the giving of any notice described therein, constitute an event of default ("Event of Default") hereunder: 1. The failure of the Agency to payor perform any covenant or obligation hereunder or under the terms of the Note, without curing such failure within ten (10) days after receipt of written notice of such default from the City (or from any party authorized by the City to deliver such notice as identified by the City in writing to the Agency). Further provided, that the herein described notice requirements and cure periods shall not apply to the following (hereinafter, "Non-Curable Defaults"): (i) any failure by the Agency to transfer monies from the general fund of the Agency to the City to make Mandatory Prepayments, as provided in Section 5 of this Agreement or (ii) the Event of Default described in the following Section 16(A) (2). 2. Failure of the Agency to pay the outstanding principal balance of the Note on any Applicable Maturity Date (as defined in the Note) ; 3. Any attempted assignment or transfer by the Agency not in compliance with Section 11 above; 4. The falsity of any material representation or breach of any material warranty made by the Agency under the terms of 582001:9949.1 13 e e e this Agreement, the Note or any other document executed in connection herewith; 5. A determination by the City or HUD that use of the Loan proceeds by the Agency does not constitute an eligible activity under the Act, 24 CFR 570.200 et sea., or other applicable regulations; 6. The Agency shall either (a) apply for or consent to the appointment of a receiver, trustee, liquidator or custodian or the like of its property, (b) fail to payor admit in writing its inability to pay its debts generally as they become due, (c) make a general assignment for the benefit of creditors, (d) be adjudicated a bankrupt or insolvent or (e) commence a voluntary case under the Federal bankruptcy laws of the United States of America or file a voluntary petition or answer seeking an arrangement with creditors or an order for relief or seeking to take advantage of any insolvency law or file an answer admitting the material allegations of a petition filed against it in any bankruptcy or insolvency proceeding; or 7. If without the application, approval or consent of the Agency, a proceeding shall be instituted in any court of competent jurisdiction, under any law relating to bankruptcy, in respect of the Agency, for an order for relief or an adjudication in bankruptcy, a composition or arrangement with credi tors, a readj ustment of debts, the appointment of a trustee, receiver, liquidator or custodian or the like of the Agency or of all or any substantial part of the Agency's assets, or other like relief in respect thereof under any bankruptcy or insolvency law, and, if such proceeding is being contested by the Agency, in good faith, the; same shall (a) result in the entry of an order for relief or any such adjudication or appointment, or (b) continue undismissed, or pending and unstayed, for any period of ninety (90) consecutive days. B. Remedies. Upon the occurrence of an Event of Default hereunder, the City may, in its sole discretion, take anyone or more of the following actions: 1. By notice to the Agency (unless an Event of Default is a Non-Curable Default as defined in Sections 13 (A) (1) above in which case no notice shall be required), declare the SB2001:9949.1 14 e e e entire principal balance of the Loan then unpaid together with interest accrued thereon immediatel.y due and payable, and the same shall become due and payable without further demand, protest or further notice of any kind, all of which are expressly waived. Upon such declaration the outstanding principal of the Loan shall thereafter bear interest ("Default Interest") at the annual rate of interest equal to the lesser of (a) four percent (4%) above the rate of interest announced from time to time by Bank of America, Downtown San Bernardino Branch (or, in the event that said bank is acquired or ceases operations, then, if there is no successor bank, another established and financially secure institutional lender selected by the City), as its prime or reference rate or (b) the maximum rate of interest permitted to be paid to the City pursuant to any applicable usury law, payable from the date of such declaration until paid in full; 2. Take action at law or in equity as may appear necessary or desirable, in the sole discretion of the City, in order to collect the amounts then due and thereafter to become due hereunder and under the Note, and to enforce performance and observance of any obligation, agreement or covenant of the Agency under this Agreement or under any other document executed in connection herewith; 3. Take any and all actions and do any and all things which are allowed, permitted or provided by law, in equity or by statute to enforce and collect upon the Note, including without limitation suing on the Note or foreclosing legally or judicially on the Senior Deed of Trust. C. No Remedv Exclusive. No remedy herein conferred upon or reserved to the City is intended to be exclusive of any other available remedy or remedies, but each such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now existing at law or in equity or by statute; and may be exercised in such number, at such times and in such order as the City may determine in its sole discretion. No delay or omission to exercise any right or power upon the occurrence of any Event of Default hereunder shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient by the City. In order to entitle the City to exercise any right or remedy reserved to it under this SB2001:9949.1 15 e e e Agreement, no notice shall be required except as expressly provided herein. 14. AGREEMENT TO PAY ATTORNEYS' FEES AND EXPENSES. The Agency agrees to payor reimburse the City, upon demand by the City, for all reasonable out-of-pocket costs incurred by the City in connection with the enforcement of this Agreement, the Note, including without limitation, reasonable attorneys' fees and costs (i) if the City shall determine to utilize an attorney to collect any sums due under this Agreement or any other documents executed in connection with this Agreement following any default by the Agency, or (ii) if the City becomes a party or otherwise appears in any legal proceeding relating to this Agreement or any documents issued hereunder or in connection herewith, or (iii) if there shall be filed by or against the Agency any proceedings under any federal or state bankruptcy or insolvency laws, whether the Ci ty is a creditor in such proceeding or otherwise. For the purposes of this Agreement, the phrase "reasonable attorneys' fees" shall include the salaries, overhead and benefits of the City Attorney for the City of San Bernardino and the attorneys employed in his office. 15. CONFLICT OF INTEREST: NO INDIVIDUAL LIABILITY. No official or employee of the City shall have any personal interest, direct or indirect, in this Agreement, nor shall any official or employee of the City participate in any decision relating to this Agreement which affects such official's or employee's pecuniary interest in any corporation, Partnership or association in which such official or employee is directly or indirectly interested. No official or employee of the City shall be personally liable in the event of a breach of this Agreement by the City. 16. AMENDMENTS. CHANGES AND MODIFICATIONS. This Agreement may only be amended, changed, modified or altered by a writing signed by both of the Parties. 17. EXECUTION OF COUNTERPARTS. This Agreement may be executed in several counterparts each of which shall be an original and all of which shall constitute one and the same document. 582001:9949.1 16 e e e 22. NOTICES. All notices to be given under this Agreement shall be in writing and shall be delivered personally, by Federal Express or other like overnight courier or by certified or registered United States Mail, return receipt requested. Any notice shall be effective upon delivery or refusal to accept delivery, if delivered personally, one (1) day after deposit with the Overnight courier, if delivered by Federal Express or other like Overnight courier, and two (2) days after mailing, if delivered by certified or registered United States Mail. Notices to the Agency shall be sent to the following address: Redevelopment Agency of the City of San Bernardino 201 North "E" Street, Suite 301 San Bernardino, California 92401 Attn: Executive Director With a copy to: Lewis, D'Amato, Brisbois & Bisgaard LLP 650 East Hospitality Lane, Suite 600 San Bernardino, California 92408 Attn: Timothy J. Sabo, Esq. Notices, reports and statements to the City shall be delivered or sent to the following address: City of San Bernardino 300 North "D" Street San Bernardino, California 92418 Attn: Mayor With a copy to: City of San Bernardino 300 North "D" Street San Bernardino, California 92418 Attn: City Attorney Each Party shall promptly notify the other Party of any change(s) of address to which notice shall be sent pursuant to this Agreement. 882001:9949.1 17 e e e 19. SEVERABILITY. The provisions provision. invalidity or unenforceability of anyone or of this Agreement will in no way affect any. more other 20. INTERPRETATION. Whenever the context requires, all words used in the singular will be construed to have been used in the plural, and vice versa, and each gender will include any other gender. The captions of the paragraphs of this Agreement are for convenience only and do not define or limit any terms or provisions. Time is of the essence in the performance of this Agreement. 21. NO WAIVER: CONSENTS. Any waiver by the City must be in writing and will not be construed as a continuing waiver. No waiver will be implied from any delay or failure by the City to take action on account of any default of the Agency. Consent by the City to any act or omission by the Agency will not be construed to be a consent to any other or subsequent act or omission or to waive the requirement for the City's consent to be obtained in any future or other instance. 22. GOVERNING LAW. This Agreement shall be governed by the laws of the State of California. 23. AUTHORITY AND ENFORCEABILITY. The Agency warrants and represents that its execution hereof has been duly authorized, that the individual(s) executing this Agreement are authorized to do so, and this Agreement constitutes a legal, valid and binding obligation of the Agency. 24. LITIGATION AND COMPLIANCE. To the Agency's actual knowledge, there are no s~its, other proceedings or investigations pending or threatened against, or affecting the business or the properties of the Agency (other than those as have been previously disclosed in writing to the City) which could materially impair its ability to perform its obligations under this Agreement, nor is the Agency in violation of SB2001:9949.1 18 e e e any laws or ordinances which could materially impair the Agency's ability to perform its obligations under this Agreement. 25. DEFAULT. To the Agency's actual knowledge, there are no facts now in existence which would, with the giving of notice of the lapse of time, or both, constitute an "Event of Default" hereunder, as described in Section 13. 8B2001:9949.1 19 e e e IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date and year first above written. REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO By: Executive Director ATTEST: By: Agency Secretary APPROVED AS TO FORM: By: Agency Special Counsel CITY OF SAN BERNARDINO By: Mayor ATTEST: By: City Clerk APPROVED AS TO FORM: By: City Attorney ACCEPTED AND AGREED TO: GOLD MOUNTAIN FINANCIAL INSTITUTION, INC., a California corporation By: Its President SB2001:9949.1 20 e e e EXHIBIT "A" RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: Redevelopment Agency of the City of San Bernardino 201 North "E" Street, Suite 301 San Bernardino, California 92401 Attention: Executive Director Space above for Recorder's Use ASSIGNMENT OF DEED OF TRUST THIS ASSIGNMENT OF DEED OF TRUST is executed this _ day of 2001, by Gold Mountain Financial Institution, Inc., a California corporation ("Gold Mountain"), in favor of the Redevelopment Agency of the City of San Bernardino, a public body corporate and politic (the "Agency"). RECITALS A. The Redevelopment Agency of the City of San Bernardino (the "Agency") and the City of San Bernardino (the "City") are parties to that certain Float Loan Agreement dated __, 2001 (the "Loan Agreement") pursuant to which the City will loan to the Agency, on and subj ect to the terms and conditions set forth therein, an aggregate principal amount not to exceed Three Million Six Hundred Thousand Dollars ($3,600,000.00) (the "Loan"). B. Pursuant to the Loan Agreement, the Agency is using the proceeds of the Loan to acquire that certain Note Secured By Deed of Trust dated June 14, 2000 held by Gold Mountain (the "Note"). The Note is secured by a Deed of Trust, Assignment of Rents and Fixture Filing dated June 14, 2000 (the "Deed of Trust") and more fully described below. NOW, THEREFORE, with reference to the above recitals and in reliance thereon, and for such other good and valuable 882001:9949.1 Exh. A - Page 1 e e e consideration the receipt and sufficiency of which is hereby acknowledged, the undersigned agrees as follows: Gold Mountain hereby grants, assigns and transfers to the Agency all beneficial interest under that certain Deed of Trust, Assignment of Rents and Fixture Filing dated June 14, 2000, executed by MDA-San Bernardino Associates, LLC, a Delaware Limited Liability Company, Trustor, to Bar K, Inc., a California corporation, Trustee, and recorded 2000, as Instrument No. , in Book ____, Page of Official Records in the office of the County Recorder of San Bernardino County, California, describing land therein as: PARCELS 1 AND 2 OF PARCEL MAP NO. 15038, IN THE CITY OF SAN BERNARDINO, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT RECORDED IN BOOK 186 OF PARCEL MAPS, PAGE(S) 14 AND 15, RECORDS OF SAID COUNTY. TOGETHER WITH ALL APPURTENANT EASEMENTS, INCLUDING, WITHOUT LIMITATION, THE EASEMENT CONTAINED IN THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND RECIPROCAL EASEMENTS, RECORDED DECEMBER 29, 1998, INSTRUMENT NUMBER 98 -556710, SAN BERNARDINO COUNTY RECORDS, AND THE EASEMENTS CONTAINED IN THE PARKING AGREEMENT RECORDED DECEMBER 29, 1998, INSTRUMENT NUMBER 98-556712, SAN BERNARDINO COUNTY RECORDS. Together with all the improvements now or hereafter erected on the Property, all replacements, all additions, all easements, rights, rents, royalties, mineral, oil and gas rights, water rights and stock and all fixtures now or hereafter a part of the Property, the Landlord's interest in the lease between Trustor, as landlord, and Cinemaster Luxury Theaters, Inc., a tenant, dated December 20, 1996 and Trustor's security therein. All of the foregoing is referred to as the "Property". 582001:9949.1 Exh. A - Page 2 e tit tit TOGETHER with the Note therein described, become due thereon wi th interest, and all accrue under said Deed of Trust. Dated , 2001 STATE OF CALIFORNIA ss. COUNTY OF SAN BERNARDINO On 2001, before me, personally appeared and --------------------- personally known to me (or proved to me on the basis of satisfactory evidence to be) the person(s) whose name (s) .is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) and that by his/her/their signature(s) on the instrument the person (s) or the entity upon behalf of which the person acted, executed the instrument. the money due and to rights accrued or to GOLD MOUNTAIN FINANCIAL INSTITUTION, INC., a California corporation By: President By: Secretary SB2001:9949.1 Exh. A - Page 3 e e e EXHIBIT "B" RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) ) City of San Bernardino ) 300 North "D" Street ) San Bernardino, California 92418 ) Attention: City Attorney ) Space above for Recorder's Use ASSIGNMENT OF DEED OF TRUST THIS ASSIGNMENT OF DEED OF TRUST is executed this day of , 2001, by the Redevelopment Agency of the City of San Bernardino, a public body corporate and politic (the "Agency") in favor of the City of San Bernardino, a municipal corporation (the "City"). RECITALS A. The City and the Agency are parties to that certain Float Loan Agreement dated 2001 (the "Loan Agreement") pursuant to which the City will loan to the Agency, on and subject to the terms and conditions set forth therein, an aggregate principal amount not to exceed Three Million Six Hundred Thousand Dollars ($3,600,000.00) (the "Loan"). B. Pursuant to the Loan Agreement, the Agency is using the proceeds of the Loan to acquire that certain Note Secured By Deed of Trust dated June 14, 2000 held by Gold Mountain (the "Note"). The Note is secured by a Deed of Trust, Assignment of Rents and Fixture Filing dated June 14, 2000 (the "Deed of Trust") and more fully described below. C. In consideration of the payment by the Agency of the acquisition price of the Note, Gold Mountain assigned the Deed of Trust to the Agency pursuant to that certain Assignment of Deed of SB2001:9949.1 Exh. B-1 e e e Trust dated , 2001 and as Instrument No. Official Records in the office Bernardino, California. recorded in Book of the County , 2001, Page of Recorder of San NOW, THEREFORE, with reference to the above recitals and in reliance thereon, and for such other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, the undersigned agrees as follows: The Agency hereby grants, assigns and transfers to the City all beneficial interest under that certain Deed of Trust, Assignment of Rents and Fixture Filing dated June 14, 2000, executed by MDA-San Bernardino Associates, LLC, a Delaware Limited Liability Company, Trustor, to Bar K, Inc., a California corporation, Trustee, and recorded 2000, as Instrument No. , in Book ____, Page of Official Records in the office of the County Recorder of San Bernardino County, California, describing land therein as: PARCELS 1 AND 2 OF PARCEL MAP NO. 15038, IN THE CITY OF SAN BERNARDINO, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT RECORDED IN BOOK 186 OF PARCEL MAPS, PAGE(S) 14 AND 15, RECORDS OF SAID COUNTY. TOGETHER WITH ALL APPURTENANT EASEMENTS, INCLUDING, WITHOUT LIMITATION, THE EASEMENT CONTAINED IN THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND RECIPROCAL EASEMENTS, RECORDED DECEMBER 29, 1998, INSTRUMENT NUMBER 98-556710, SAN BERNARDINO COUNTY RECORDS, AND THE EASEMENTS CONTAINED IN THE PARKING AGREEMENT RECORDED DECEMBER 29, 1998, INSTRUMENT NUMBER 98-556712, SAN BERNARDINO COUNTY RECORDS. Together with all the improvements now or hereafter erected on the Property, all replacements, all additions, all easements, rights, rents, royalties, mineral, oil and gas rights, water rights and stock and all fixtures now or hereafter a part of the Property, the Landlord's interest in the lease between Trustor, as landlord, and Cinemaster SB2001:9949.1 Exh. B-2 e e e Luxury Theaters, December 20, 1996 therein. All of the as the "Property". Inc., a tenant, dated and Trustor's security foregoing is referred to TOGETHER with the Note therein described, become due thereon wi th interest, and all accrue under said Deed of Trust. Dated , 2001 REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO By: the money due and to rights accrued or to Executive Director ATTEST: Agency Secretary STATE OF CALIFORNIA ss; COUNTY OF SAN BERNARDINO On 2001, before me, personally appeared and personally known to me (or proved to me on the basis of satisfactory evidence to be) the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) and that by hiS/her/their signature(s) on the instrument the person (s) or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and official seal. 582001:9949.1 Exh. B-3 "0 ~ !'oil ... - ... ~ ~ "0 ;.,l ~ ~ 00- ~ ~ Q = CI.l ~ ~ ;.,l ~ ~ ~ ~ ~ = ~ "0 :.. 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".~ r~~ ~ -: -- ** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT ** RESOLUTION AGENDA ITEM TRACKING FORM Meeting Date (Date Adopted): 4-110-01 Item # R:, 4 ~ Vote: Ayes \- ~ Nays rt Abstain Change to motion to amend original documents: Reso. # On Attachments: V Contract term: Note on Resolution of Attachment stored separately: -=- Direct City Clerk to (circle I): PUBLISH, POST, RECORD W/COUNTV Date Sent to Mayor: 4-\ <Y.o\ Date of Mayor's Signature: 4-\ <;-0 ( Date of Clerk/CDC Signature: -4-\ 4 -c \ Date Memo/Letter Sent for Signature: 60 Day Reminder Letter Sent on 30th day: 90 Day Reminder Letter Sent on 45th day: See Attached: See Attached: 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): Copies Distributed to: City Attorney Parks & Rec. Code Compliance Dev. Services Public Services Water Police Resolution # Goe.-J 2()01-/>S .& Absent <0 SEE C():../ZM \ - 1(.. ?,NJI-8'1 I ' NullNoid After: - By: - Reso. Log Updated: V Seal Impressed: Date Returned: .$"- '2.-0 \ Yes /' No By Yes No L By Yes No -L By Yes No ./ By Yes No 17 By EDA ,/ MIS Finance Others: Notes: 80A 66T'f>'"",('If, '<)It:..f'\a\rA~ o.J fuK'l1\~ ~1U.~lY\b"Y'-T. BEFORE FILING. REVIEW FORM TO ENSURE ANY NOTATIONS MADE HERE ARE TRANSFERRED TO THE YEARLY RESOLUTION CHRONOLOGICAL LOG FOR FUTURE REFERENCE (Contract Term. etc.) Ready to File: _ Date: Revised 0 1/12/0 I ** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT ** RESOLUTION AGENDA ITEM TRACKING FORM Meeting Date (Date Adopted): .q -I "-0 I Item # R 34 e Vote: Ayes 1-5 Nays 1\ Abstain Change to motion to amend original documents: Ptm810 ~~ Reso. # On Attachments: -=- Contract term: - Note on Resolution of Attachment stored separately: ~ Direct City Clerk to (circle I): PUBLISH, POST, RECORD W/COUNTY Date Sent to Mayor: 4- \(rO \ Date of Mayor's Signature: "', 1<1 <>1 Date ofClerk/CDC Signature: 6,-\0, <>\ Date Memo/Letter Sent for Signature: 60 Day Reminder Letter Sent on 30th day: 90 Day Reminder Letter Sent on 45th day: See Attached: See d: See Attached: 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): Copies Distributed to: City Attorney Parks & Rec. Code Compliance Dev. Services Public Services Water Police Notes: Resolution # Cfr.-} 2ee I - I b e- Absent "" sa; Cex:..j"2C01-1S, ZObH<'\ NullNoid After: - By: - Reso. Log Updated: V Seal Impressed: Date Returned: Yes -.L. No By Yes No~ By Yes No~ By Yes No ----'L- By Yes No -.-L By EDA v MIS Finance Others: BEFORE FILING, REVIEW FORM TO ENSURE ANY NOTATIONS MADE HERE ARE TRANSFERRED TO THE YEARLY RESOLUTION CHRONOLOGICAL LOG FOR FUTURE REFERENCE IContract Term, etc.1 Ready to File: _ Date: Revised 01/12/0 I ** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT ** RESOLUTION AGENDA ITEM TRACKING FORM Meeting Date (Date Adopted): 4-\<o-O~ Vote: Ayes )-$ Nays Change to motion to amend original documents: Item # t ~"'\ c.. Resolution # 2..c:c\ -'i;: I '1 Abstain -B- Absent (" .sEE ax-JZr-rM5 CQC fcWI-1 b , I , Reso. # On Attachments: L- Contract term: - Note on Resolution of Attachment stored separately: - Direct City Clerk to (circle I): PUBLISH, POST, RECORD W/COUNTY NulllVoid After: - By:- Date Sent to Mayor: A.-l"1l-() \ Date of Mayor's Signature: -'\-l'1.c>1 Date of Clerk/CDC Signature: 4,-\ q -0 \ Reso. Log Updated: Seal Impressed: v y' Date MemolLetter Sent for Signat!!!:e: 60 Day Reminder Letter Sent on 30th day: 90 Day Reminder Letter Sent on 45th day: See Attached: ________ See Attached: --- See Attached: Date Returned: 5- 2>-<::> \ Request for Council Action & StatTReport 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 --L No~ N04 No ,/ By By By By By_ Yes Yes Yes Copies Distribnted to: City Attorney Parks & Rec. 0/ Code Compliance Dev. Services EDA or- Finance MIS Police Public Services Water Others: Notes: COP, b6"1'PnI'\tflh .s1f,()m71~ Dfl Fc.cPrr I f\Al-.1 P<C~--r<I (SP,.y\lf.. ~ L0~'W.:ll-I'> J BEFORE FILING. REVIEW FORM TO ENSURE ANY NOTATIONS MADE HERE ARE TRANSFERRED TO THE YEARLY RESOLUTION CHRONOLOGICAL LOG FOR FUTURE REFERENCE (Contract Term, etc.) Ready to File: _ Date: Revised 01/12/01