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HomeMy WebLinkAboutResolution - 2000-R0050 - Estoppel Certificate And Agreement - Fore Star Gold LLC - Banc Of America CFC - 02/10/2000I, �, It I I ■ Resolution No. 2000-R 0050 February 10, 2000 Item No. 58 RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock BE and is hereby authorized and directed to execute on behalf of the City of Lubbock an Estoppel Certificate and Agreement, and any associated documents, by and between the City of Lubbock, Fore Star Golf of Lubbock, L.L.C., and Banc of America Commercial Finance Corporation, which Agreement is attached hereto and which shall be a part of this Resolution as if fully copied herein in detail. Passed by the City Council this 10th day of February , 2000. Max Ince, fAayorProTem ATTt�L- Kaythie'Damell, City Secretary APPROVED AS TO CONTENT: Tommy G6nzalez, ManaL411g Director for Civic Services APPROVED AS TO FORM: G. Vandiver, First Assistant Attorney DDres/Forestar2..res February 1, 2000 IiiL. ii, i{. .a. . Resolution No. 2000-R 0050 February 10, 2000 Item No. 58 ESTOPPEL CERTIFICATE AND AGREEMENT THIS ESTOPPEL CERTIFICATE AND AGREEMENT (this "Agreement") is entered into as of the 1othday of February , 2000, among the CITY OF LUBBOCK, TEXAS, a home -rule city of the State of Texas duly organized and existing pursuant to its charter and the laws of the State of Texas (the "W'), '), FORE STAR GOLF OF LUBBOCK, LLC, a Texas limited liability company ("FSGL'), and BANC OF AMERICA COMMERCIAL FINANCE CORPORATION, a Delaware corporation, formerly known as NationsCredit Commercial Corporation (` n er"). Recitals A. The City is the owner of two public golf courses located in Lubbock County, Texas, which are commonly known as the "Meadowbrook Golf Course" and the "Squirrel Hollow Golf Course" (the "Golf Courses"). B. The City and Fore Star Golf, Inc. ("FSG") are parties to a Management Agreement dated as of October 14, 1994 (the "Management Agreement"), pursuant to which FSG agreed to manage the Golf Courses for the City. The rights and obligations of FSG under the Management Agreement were assigned by FSG to FSGL pursuant to an Assignment of Management Agreement executed as of March 22, 1999 (the "Assignment"). C. Lender made a loan to FSGL, Fore Star Golf of Yuma, LLC, and Sonoma Ranch Golf, LLC (collectively, `Borrowers') in the amount of $5,400,000 on March 15, 1999 (the "Loan"). The terms of the Loan are set forth in a Loan Agreement dated March 15, 1999, between Borrowers and Lender, and the obligations of Borrowers to repay the Loan are evidenced by a promissory note dated March 15, 1999, made by Borrowers and payable to the order of Lender in the original principal amount of $5,400,000 (the "Note"). D. The Note is secured by, among other things, a Collateral Assignment of Management Agreement executed as of March 22, 1999 (the "Collateral Assignment'), pursuant to which FSGL's obligations with respect to the Loan are secured by FSGL's rights under the Management Agreement. The City consented to the making of the Assignment and the Collateral Assignment pursuant to that certain Estoppel Certificate and Agreement among the City, FSG, FSGL and Lender entered into as of March 11, 1999 (the "Original Estoppel and Agreement'). E. Lender has agreed to make a loan in the maximum principal amount of $3,000,000 (the "FSGA Loan") to Fore Star Golf of Abilene, LLC, a Texas limited liability company ("FSGA'), which is an affiliate of FSGL, on the condition that the Loan and the FSGA Loan shall be fully cross -defaulted and cross -collateralized. In order to achieve such cross - defaulting and cross -collateralization, FSGL and Lender have agreed to amend the Collateral Assignment to provide that FSGL's rights under the Management Agreement shall be security for (i) all of FSGL's obligations with respect to the Loan and (ii) all of FSGA's obligations with respect to the FSGA Loan. 447026.2 ASCOHE 02/110011:35 AM e II h Y. 11 , r F. It is a condition to Lender's willingness to make the FSGA Loan that the City consent to the amendment of the Collateral Assignment and that the City confirm certain facts and make certain agreements for the benefit of the Lender. The City is willing to do so. Agreement NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 1. Incorporation of Recitals. The Recitals set forth above are hereby incorporated into and made a part of this Agreement. 2. Estoppel Certificate. The City hereby confirms the following: (a) the Golf Courses are owned by the City, and the City has not made any assignment or transfer of, or created any options, purchase rights or other interests in, the Golf Courses, with the exception of the Management Agreement, and no consent or approval of any other person or entity is required in order for the City to enter into, or as a condition to the effectiveness of, this Agreement; (b) the Management Agreement has been amended by an Amendment executed by the parties thereto dated May 22, 1997, and it has not otherwise been amended or modified in any respect, with the exception of its being assigned to FSGL pursuant to the Assignment; and (c) to the best of the City's knowledge, FSGL has performed and observed all of its covenants and conditions under the Management Agreement and the Assignment, and is not in default under the Management Agreement or the Assignment in any respect. 3. Cross -Default. The City hereby acknowledges that any and all rights provided to Lender under the Original Estoppel and Agreement upon the occurrence of an Event of Default under the Loan, including, without limitation, Lender's Right to Become Manager under Paragraph 7 thereof, will be available to Lender upon the occurrence of an Event of Default under the FSGA Loan. 4. Consent to Amendment of Collateral Assignment. The City hereby consents to the amendment of the Collateral Assignment, so long as said amendment is finally executed in identical terms to the draft First Amendment to Collateral Assignment attached hereto as Exhibit A. 5. Notices. Any notice which any party hereto may be required or may desire to give hereunder shall be delivered personally, mailed, postage prepaid, by United States registered or certified mail, return receipt requested, or sent by overnight express courier, addressed as follows: 447026.2 A=HE o2r1/0011:35AM 2 H qI Y.. rl If to the Citv: City of Lubbock, Texas Municipal Building 1625 Thirteenth Street Lubbock, Texas 79401 Attn: Director of Culture/Leisure and Recreation If to FSGL: Fore Star Golf of Lubbock, LLC 301 Commerce, Suite 1470 Fort Worth, Texas 76102 Attn: Gary G. Miller with a copy to: Miller, Stratvert & Torgerson 500 Main Street, Suite 800 Las Cruces, New Mexico 88001 Attn: Dana Kyle, Esq. If to Lender: Banc of America Commercial Finance Corporation 187 Danbury Road Wilton, Connecticut 06897 Attn: Vice President Golf & Recreational Finance with a copy to: Banc of America Commercial Finance Corporation 187 Danbury Road Wilton, Connecticut 06897 Attn: General Counsel with an additional copy to: Banc of America. Commercial Finance Corporation 400 Northridge Road, Suite 520 Atlanta, Georgia 30350 Attn: Vice President — Real Estate and Recreation or at such other addresses or to the attention of such other persons as may from time to time be designated by the party to be addressed by written notice to the other in the manner herein provided. Notices, demands and requests given in the manner aforesaid shall be deemed 44M62 ASCOHE ov1100 11:33 AM 3 sufficiently served or given for all purposes hereunder when received or when delivery is refused or when the same are returned to sender for failure to be called for. 6. Termination Upon R avment of Loan. This Agreement shall terminate and be of no further force or effect at such time as (i) the Loan has been repaid in full and (ii) there exists no "Event of Default" as defined in the FSGA Loan Documents. 7. Amendments and Binding Effect. This Agreement may be modified only by an agreement in writing signed by the parties hereto. This Agreement shall inure to the benefit of and be binding upon the parties hereto, together with their permitted successors and assigns. 8. Continuing Effect. Except as expressly modified hereby, all terms and conditions of the Original Estoppel and Agreement remain in full force and effect, including, without limitation, the provisions thereof relating to Lender's notice and cure rights. 9. Governing Law. This Agreement shall be construed and enforced in accordance with the laws of the State of Texas and the United States of America.. 10. Counterparts: Telecopied Signatures. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Telecopied signatures shall be sufficient for purposes of executing this Agreement. 11. Further Assurances. Each of the parties to this Agreement agrees that it will without further consideration execute and deliver such other documents and take such other actions as may reasonably be requested by any other party to this Agreement in order to consummate more effectively the transactions contemplated hereby. IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. [The remainder of this page has been left blank intentionally.] 147026.2 ASCME 0V110011:35AM 4 e�mis� CITY OF LUBBOCK, TEXAS MAYOR?i►o T-" ••✓ ATTEST: I aL 4W A - Name: thie Darnell Title: ity Secretary APPROVED AS TO CONTENT: roft4mY &1.JiLar APPROVED AS TO FORM: FSGL: FORE STAR GOLF OF LUBBOCK, a Texas limited liability company By: Fore Star Golf Inc., a Nevada corporation, as Member /A By: , b?P4 t . Yo President and Chief Operating Officer LENDER: BANC OF AMERICA COMMERCIAL FINANCE CORPORATION, a Delaware corporation Barbara W. Welty Its Authorized Signatory l Resolution No. 2000 80050 February 10, 2000 Item No. 58 EXHIBIT A to ESTOPPEL CERTIFICATE AND AGREEMENT (Form of First Amendment to Collateral Assignment) FIRST AMENDMENT TO COLLATERAL ASSIGNMENT OF MANAGEMENT AGREEMENT THIS FIRST AMENDMENT TO COLLATERAL ASSIGNMENT OF MANAGEMENT AGREEMENT (this "Amendment") is made as of the day of 2000, between FORE STAR GOLF OF LUBBOCK, LLC, a Texas limited liability company ("Assignor"), and BANC OF AMERICA COMMERCIAL FINANCE CORPORATION, a Delaware corporation, formerly known as NationsCredit Commercial Corporation ("Assignee"). Recitals A. Assignee made a loan to Assignor, Fore Star Golf of Yuma, LLC, and Sonoma Ranch Golf, LLC (collectively, `Borrowers") in the amount of $5,400,000 on March 15, 1999 (the "Loan"). The terms of the Loan are set forth in a loan agreement dated March 15, 1999 (the "Loan Agreement"), between Borrowers and Assignee, and the obligations of Borrowers to repay the Loan are evidenced by a promissory note dated March 15, 1999, made by Borrowers and payable to the order of Assignee in the original principal amount of $5,400,000 (the "Note"). B. The Note is secured by, among other things, a Collateral Assignment of Management Agreement executed as of March 22, 1999 (the "Assignment"). The Assignment encumbers all of Assignor's right, title and interest (the "Management Interest") relating in any way to that certain Management Agreement entered into on October 7, 1994 by Fore Star Golf, Inc. ("FSG") and the City of Lubbock, Texas, as amended by an amendment dated May 22, 1997 (the "Management Agreement"), which Management Agreement was assigned by FSG to Assignor pursuant to that certain Assignment of Management Agreement executed as of March 22, 1999 between FSG and Assignor. Any capitalized terms used but not otherwise defined in this Amendment shall have the meanings assigned to such terms in the Assignment. The Loan Agreement, the Note, and the Assignment, together with all other mortgages, deeds of trust, and other instruments and documents securing the Note, and each other document executed or delivered in connection with the transactions pursuant to which the Note has been executed and delivered, and all modifications thereto, are hereinafter collectively referred to as the "Loan Documents." C. Pursuant to a Loan Agreement of even date herewith (the "FSGA Loan Agreement") between Assignee and Fore Star Golf of Abilene, LLC, a Texas limited liability company ("FSGA"), which is an affiliate of Assignor, Assignee has agreed to make a loan to FSGA in the maximum principal amount of $3,000,000 (the "FSGA Loan"). The FSGA Loan is Exhibit A Page 1 447026.2 ASCOHE 02/1/0011:33 AM ril n i I 1 II. e. i evidenced by a promissory note of even date herewith made by FSGA in favor of Assignee in the principal amount of $3,000,000 (the "FSGA Note"). The FSGA Loan is secured by, among other things, a deed of trust and security agreement of even date herewith (the "FSGA Mortgage") encumbering those certain parcels of real property commonly known as the Fairway Oaks Country Club located in Abilene, Texas. The FSGA Loan Agreement, the FSGA Note, and the FSGA Mortgage, together with all assignments of leases, guaranties, environmental indemnities, assignments of membership interests, assignments of permits and contracts, financing statements, and other documents and agreements evidencing or securing the FSGA Loan, as the same may be modified or amended from time to time, are hereinafter collectively referred to as the "FSGA Loan Documents." D. Assignee has agreed to make the FSGA Loan only on the condition that the Loan and the FSGA Loan shall be fully cross -defaulted and cross -collateralized. In order to achieve such cross -defaulting and cross -collateralization, Assignor and Assignee desire to amend the Assignment to provide that it shall hereafter encumber the Management Interest as security for the repayment of both the Note and the FSGA Note and the performance (i) by Assignor of all of its obligations under the Loan Documents and (ii) by FSGA of all of its obligations under the FSGA Loan Documents. Amendment NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Assignor and Assignee agree as follows: 1. Incorporation of Recitals. The Recitals set forth above are hereby incorporated into and made a part of this Amendment. 2. Definition of Obligations. The definition of Obligations set forth in Recital B of the Assignment is hereby amended by the addition of the following to the items secured by the Assignment: (i) the payment of the indebtedness in the principal sum of $3,000,000 to be paid according to the FSGA Note, (ii) the full and complete performance by FSGA of all of its obligations and agreements under the FSGA Loan Agreement, (iii) the payment of all of the other amounts, covenants, obligations, sums, expenses and liabilities due or to become due to Assignee from FSGA under all of the other FSGA Loan Documents, and (iv) the payment of all interest on said indebtedness, obligations, liabilities, amounts, sums and expenses (collectively, the "FSGA Obligations"). The FSGA Obligations shall be punctually satisfied at the times and in the manner provided in the FSGA Loan Documents. Notwithstanding the foregoing, for purposes of Section 8(a) of the Assignment concerning the discharge of the Assignment, the term "Obligations" shall be deemed to include the FSGA Obligations only if, at such time as Assignor would otherwise be entitled to the discharge of the Assignment, there exists an "Event of Default" as defined in the FSGA Loan Documents. 3. Event of Default. The definition of the term "Event of Default," as such term is used in the Assignment, is hereby amended to include among the occurrences constituting an Event of Default any Event of Default under either the Loan Documents or the FSGA Loan Documents. Exhibit A Page 2 447M6.2 ASCOHE ov1ro011:35AM R li. it 4 1 ii.. - r 4. Assignee Name: Notice Address. All references to "Assignee" or "Secured Party" contained in the Assignment shall be deemed to refer to Banc of America Commercial Finance Corporation, a Delaware corporation, formerly known as NationsCredit Commercial Corporation, whose address is 187 Danbury Road, Wilton, Connecticut 06897. 5. Continuing Effect. Except as expressly modified hereby and by such other documents as may be executed in connection herewith, all terms and provisions of the Assignment remain in full force and effect. Assignee shall have no obligation to agree to any further modifications of the Assignment. 6. Counternarts. This Amendment may be executed in counterparts, each of which shall be deemed an original, but both of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first above written. 447026.2 ASCOHE 0211/001135 AM ASSIGNOR: FORE STAR GOLF OF LUBBOCK, a Texas limited liability company By: Fore Star Golf, Inc., a Nevada corporation, as Member By: Q ol, _.. St W. YodVe President and Chief Operating Officer ASSIGNEE: BANC OF AMERICA COMMERCIAL FINANCE CORPORATION, a Delaware corporation, formerly known as NationsCredit Commercial Corporation 0 Barbara W. Welty Its Authorized Signatory Exhibit A Page 3 STATE OF e* S ) COUNTY OF L ha- (� ss. On this, the day off(Lf(jVf'LA2000, before me, the undersigned officer, personally appeared Steven W. Yonke, who ac edged himself to be the President and Chief Operating Officer of Fore Star Golf, Inc., a Nevada corporation, as Member of Fore Star Golf of Lubbock, LLC, a Texas limited liability company, and that he, as such President and Chief Operating Officer, being authorized so to do, executed the foregoing First Amendment to Collateral Assignment of Management Agreement for the purposes therein contained. IN WITNESS WHEREOF, I hereunto set my hand and official seal. My commission expires: STATE OF 6 COUNTY OF 1r--7Ll L770 A) ) ss. 0 o3 6 n�dcji) Notary Public On this, the �� day of r0 WU 2000, before me, the undersigned officer, personally appeared Barbara W. Welty, who ackitowledged herself to be the Authorized Signatory of Banc of America Commercial Finance Corporation, a Delaware corporation, and that she, being authorized so to do, executed the foregoing First Amendment to Collateral Assignment of Management Agreement for the purposes therein contained. IN WITNESS WHEREOF, I hereunto set my hand and official seal. My commission expires: 12 -1 -02 - Public 2-" % a2, Public Exhibit A Page 4 447026.2 ASCOHE 0211/0011:35 AM