HomeMy WebLinkAbout2004 Ordinance No. 029•
•
•
ORDI NANCE 0 . J?o/
SER IES OF 2004
BY AUT HOR ITY
CONTRACT NQ,
'tt.\-~ 'I-
COUNC IL BILL NO . 25
INTRODUCED BY CO CIL
MEMBER WOLO SYN
AN ORDI NANCE AUTH RIZI NG i\..SJ.Jl;\Q.B.D.!J'IAT IO AGREEMENT
BETWEEN CO LORADO HISTORI C~VOLV ING LOAN FUND ,
COLORADO PRES ER VA TION , INC . AND TH E CIT'' OF ENGLEWOOD,
CO LORADO FOR TH E REHABILITAT ION OF THE SKERR ITT PROPERTY .
WHEREAS, Co lorndo Preserva tio n, Inc. (C PI ) ha s acq uired the Skerritt Propert y
from th e Ci ty of Eng lew ood for th e purpo se of co mpletin g renova ti on and reh abi lit ati on
of improvemen ts, consis tent wi th the histori c char ac ter of th e Prope rt y; and
WHEREAS, the Co lorado State Hi stori ca l Grant is insuffi cien t to pa y all of the
required co sts of reh abilitati on of the Skcrritt Propert y required ; and
WHEREAS , CPI applied for and has been awarded a gra nt from th e Colorado Hi sto ric
Foundat io n Revol vi ng Loa n Fund (C HF) for th e rehabilit ati on of th e Skcrritt Propert y;
and
WHERAS, CP I and th e Cit y of Eng lewoo d have agreed to enter into a Subordination
Agree ment with CHF Revo lvi ng Loan Fund to indu ce th e CHF in making th e lo an;
NOW , THEREFORE , BE IT ORDAfNED BY TH E CITY COUNCIL OF TH E CITY
OF ENGLEWOOD , COLORADO , AS FOLLOWS :
~. The Subordin ati on Agreement between th e CHF Re vo lvin g Loan fund ,
th e Co lorado Pre serva tion , Inc . and the Ci ty of Englewood , Colorado for the fundin g
to stab ili ze the stru cture, rehab ilit ate the exterior an d prepare the interior for
adap ti ve reuse by th e future ow ner of th e Skerritt Prop ert y, attached here to as
Ex hibit A, is hereby accep ted an d approved the Englewood Ci ty Co un ci l.
Section 2. The Mayor and City Clerk arc authori zed to exec ut e and auc st said
Agreement for and on behalf of the Cit y of Englewood .
Int rod uc ed, rea d in full , and pas sed on fir st rea ding on th e 3rd day of Ma y, 2004 .
Publi shed as a Bill fo r an Ordinance on the 7th da y of May, 2004 .
Read by tit Ir and passed on final readin g on th e 17 th da y of Ma y, 2004 .
-1 -
P·,blishc d by titl e as Ord inanc e No;]J, Series of 2004,
200i .
I, Loucrishia A. Ellis, City Clerk of the City of Englewood, Colorado, hereby
certify that the above and foregoing is a true corJ Jf the Ordinance pa ss ed on final
reading and published by title as Ordinance No . ~• Series of 2
-2-
•
•
•
•
•
SUBORDINATION AGREEMENT
This SUBORDINATION AGREEMENT (this "S ubordination Agree ment ") is made this
day of---~ 2004 , by City of Englewood, a Co lorado Home Rule Municipal Co rporat ion
("Englewo od"), Co lorado Prese rvation. Inc., a Co lorado Non-Profit Co rporation ("CPI"), and
Colorado Historical Foundation Revo lving Loan Fund, a Colorado Non-Profit Corporation ("CHF")
(CPI , Englewood, and CHF collettively, the ·'Pm ies"\.
I
BACKGRO UN l,C IR CU MST.4/ICES
A. CPI bas acquired from Englewoo d ~ · ,, ,el of real prope rty located in Arapahoe County ,
Colorado , together with the impro verue t:ts I•. ,.i.cd thereon (the "Pro pe rty"), more particularly
described as follows:
Lots 14 through 17, inclusive , Block 6
Ske rritt 's Addition to Englewood, Third Filing .
B. The Property is historically significant for a variety of re:isons . ;, .. ,Juding the fact that it was
the residence of the founder of the City of Englewood. CPI ac4u ice-.i ,~, P:-o perty for the purpose of
completing renovation and rehabilitation of the ir.,provement$. r o~..;i:;ie::r •;•:ith the historic charac ter
of the Property.
C. l'he tenilS and co nditions under which CPI acquired the Property are se t fo rth in a Special
Warranty De ed dated April 1. 2003 (t he "Deed"). The Deed imposes conditions on CPI as the
Grantee of the Deed. The conditions require CP I to co mplete ce rtain rehabilitat ion steps by
deadline s set forth in the Deed . The Deed further provides an Jption to repurchase the Property in
favor of Englewood. as Grantor. if the conditions are not met t.-y the sc heduled deadlines.
D. CP I ap plied for and has been awarded a grant from the Color:i<:!.i State Historical Fund to pay
the costs of rehabilitation of the Property . Howeve r. the amount of the SHF grants is ins ufficie nt to
pay all of the required costs of re habilitation of the Property required under the
Deed.
E. CP I appli ed tor a loan from CHF for the purp ose of funding the balance of the anticipa ted
costs of rehabilitating the Properry . CHF has appro ved CPl 's loan reque st. subje ct to subordination
of Englewood 's rights under the Deed to a lien to be granted by CPI to secure the CPI loan . in the
amount of One Hundred Nine ty -Se ven Tho usand Three Hundred Dollars ($197.J00).
F. In ord er to induce CHF to mak e the referenced loan to CP I pursuant to the Loan
Agreement. CPI and Englewood have agreed to enter into this Subordination . .\greer.,en t wi th CHF .
Englewood wishes 10 fulfill the condition to the Loan described above by subordinating its interests
• and rights as provided herein .
COVENANTS
NOW , THEREFORE , fo : good and valuable cons ideratio n. the receipt and sufficie ncy of
wbich are hereby acknowledged, the parties hereto agree as follows :
I. Definitions . The following terms shall have the following meanings :
1.1 CHF Loan. All principal, tnte rest , fees , costs, enforcement expense~ (incl uding legal
fees and disbursements), collateral protection expenses and ,,t ,er reimhursemenl or indemnity
obligations evidencing the loan by CHF to CPI to be sec1l!W by the Property, or created in
connection with the commitment by CHF 10 loan funds to l 'Pl ;;; the amount of One Hundred
Ninety-Seven Thousand Three Hundred Dollars (S I 97 ,JOO J Jated '.k ptember JO , 2003, a.'ld any
extension, modification or renewal thereof. CHF Loan sbaJl express!;-include any and all interest
accruing or out of pocket costs or expenses incurred after tlr: 3 ne of any filing by or against CPI of
any pet ition under the federal Bankruptc y Code or an1 Nhe1· bankruptcy, insolvency or
reorganization ac t regardless of whether CHF's claim therefor is ah,lwed or allowable in the case or
proceeding relating thereto. The documents now or hereafter evidencing the CHF Loan. including
without limitation. the Note , Deed of Trust, Loan Agreement. and Security Agreement executed by
CPI in connection therewith. :ire referred to herein as the ''CHF Loan Document s. '
1.2 Deed Restrictions. All rights of E:.glewood or its successors or assigns under the
Deed .
1.3
the Deed.
Repurchase Optjon. The right ofEnglewood to repurchase the Property pursuant to
1.4 Other Defined Terms . The capitalized term, used in paragraph 7 hereof shall have the
meanings ascribed to suc h terms in the Deed .
2. Subordination. The Deed Restrictions and the Repurchas ' Option shall be and hereby are
subo rdinated 10 the full and final payment in cash of the CHF Loan. The CHF Loan and the CHF
Loan Documents shall be se nior to the Deed Restrictions or the Repurchase Option and all of the
Subordinated Doc uments irrespective o f the time of the executic-n. delivery or issuance of any
thereofor the filing or recording for perfection of any thereofor the filing of any fiuancing Slatement
or continuation statement relating to any thereof. Engle ;ood will not take or omit to take any
action or assen any clait,: with res pect to the Deed Restrictions or the Repurchase Optiu n wbich is
inconsistent with the provisions of Ibis Subordination Agreeme nt. Without limiting the foregoing ,
Englewood will not (a) assen. co llect or enf,rce the Deed Resuictions or the Repurchase Option or
any part thereof or take any action to foreclose or realize upon the Deed Restrictions or the
Repurchase Opt ion or (b) accept a vo luntary surrender or :rnnsfer of the Propeny from CPI or
modify any of the Deed Re strictions or terms of the Repurcha se Optio'l. until the CHF Loan has
been finally paid in full in cash.
J . Right to Cure . Upon the occurrence of a default by CPI unJer the terms of the CHF
•
•
•
•
•
Loan. pri or to co mmenc ing any actio n or proceed in g to to rcclo sc its Lien or othe rw ise enfo rce its
righ ts in the Pro peny sec urin g the CHF loan. CHF shall provide Eng lewood thiny (JO) days written
notice and an opportuni ty to cur e such defaults within such thirty (JO) day period. Such rig ht to
cure shall appl y to default s under any of the CHF Loan Documents , and unle ss exp ressly stat ed in
such CHF Loan Document s to the con trary, any cure periods co ntained in such doc ument s shall be
deemed to incorporate the provisions of this paragraph J . Where any other notic e or right to cure is
pro vid ed under the CHF Loan Documents. or are required by an y other contract or appLi cab le law.
said periods and the cure period co ntained in this paragra ph shall run co ncurrently.
4. Foreclosure . Englewood and CP! agree that, provided that the Property is subje ct to an
easement in favor of the Colorado Historical Foundation or it s designee and the City o f Englewood
prohibiting chaoges to the impro vements to the Property that are not consis tent with the historical
character and significance of the Property, any person acquiring any intere st in the Property as a
1esult of th e enforcement o f remedies provided in the CHF Loan Document s (including wit hout
lircit:atio n. the holder of a Ce nificate of Purchase or a PubLic Trustee 's Deed arising from the
foreclosure of the Deed o f Trust by a Public Trustee ) shall take such interest free and clear of any
obligation to pet form the Deed Re strictions or pe rfo rm the Repurchase Option. [f the Pro pe rty is
not subjected to an ease ment as provided above, any holder of a Ce rtifi ca te of Purc hase or Public
Trustee 's Deed shall take such int ere st subject to the Deed Res trictions and the Repurchase Opt io n.
5. Reaffinnation of Deed Res trictions . Englewo od acknowledgej that rp1 has not met the
requirement contained in par.1graph 1 a of the Deed, to co mplete the First Pila,. uf Reha bilitation no
later than September 30, 2003. Englewood and CPI agree to extend the First Reha bilitation
Deadline to Dec ember 3 1, 200 5. Except as expre ss ly pro vided herein to the co ntrary , nothing
contained in this Subordination Agreement shall impair. as between CPI and Englewood . the
obligation of CPI to complete the Rehabilitati on of the Property in accordanc e with the Deed
Re strictions .
6. Detense to Enfo rceme nt. If Englewoo d. in co ntrave ntio n of the terms o f this Subo rdinatio n
Agree ment . shall commence . prosec ute or participate in any suit. ac tio n or proceed ing agains t CPI to
enforce the Deed Res trictions or the Repurch ase Op ti on. then CPI may interpo se as a detense or plea
the making of this Subo rdinati on Agreement. and CHF may intervene and interp ose suc h de tense or
plea in its name or int! name o f CPI.
7. Further Ass uran ce s. Eng lewood agrees to cooperat e wi th CHF shou ld there be an y funher
documentation nec essary to co ntirm the senior pri ority of the CHF Loan as cont emplated he reby.
8. CHF's Freedo m of Dealing . Englewood ag rees. with re spect to the CHF Loan and :m y and
all co lla te ral therefor or guarantie s thereot: that CPI and CHF may agre e to in crease th e amoun t of
the CHF Loan or otherwise modify the terms of the CHF Loan. and CHF ma y grant extensions o f
the time of payment or perfo nnun ce to and make co mpromises. includ ing re leases o f co llateral or
guarant ies. and se nlement s with CPI and all other per so ns . in each c:ise without the co nsent of
En glewoo d or CPI and without affecting the agreement s of Engle wood or CP I co ntained in this
• Subo rdinat ion Agreement. provided howeve r. that the purpose of a.,y irv;r,·:ise in the amount of the
CHF Luan shall be limited to completio n of renovations of the imp rovemen ts to the Property. and •
not tor any other project . or fo r th e ge neral use of CPI. The rights co nferred on CHF hereunder are
solely to protect its int eres ts under the Loan Document s and shall not imp ose any duty upon it to
exerc ise any such powers . CHF shall not responsib le to the Eng lewood or CPI fo r an y act or fail ure
r. act or to exercise or defond an y ri gh t granted hereunde r. All conse nt s and other actions of CHF
contempi~ted by this Subordinati o n Agre ement may be give n. taken, withheld or not taken in CHF's
discretion (whether or not so exp re ssed). and CPI waives any dury of CHF to exercise goo d faith or
any other obligation to act other than in CHF"s sole interest . No claim shall be made by Englewood
or CPI against CHF or the affiliates. directors. o fficers. employees or agents of CHF for any special.
indirect . consequential or punitive damages in respect of any claim for breach of contract or under
any other theory of liability arisin g out of or related to the transactions co ntemplated by this
Subordination Agree ment and the Loan Agreement. or any act . omiss ion or eve nt oc currin g in
connection therewith; and CPI and Englewood hereby waive. release and agree not to sue upon any
claim fo r any such damages . whether or not accrued and w 1e:her or not known or suspected to exist
in its favor. now or hereafter.
9. Termination of Subordination . This Subordinat io n Agreement shall cont inue in full force and
effect. and the o bligations and agree ments of Eng lewood and CPI here under shall co ntinue to be
full y operati ve. until all of the CH F Loan sha ll have been paid and satisfied in full in c:ish and suc h
full payment and satisfaction shall be final and not avo idable. To the exte nt that CPI or any
guarantor of or provider of colla teral for the CHF Loan makes any payment on the CHF Loan that is
subsequently invalidated, declared to be fraudulent or pre fe rential or set :iside or is required to be
repaid to a trustee . receiver or any other parry under any bankruptc y, insolvenc y or reorganization •
act , state or federal law , common law or equitable cause (such payment being hereinafter referr ed to
as a "Voided Payment"), then to the extent of such Voided Payment. that ponion of the CHF r.oan
that had been pre vio usly satisfied by such Vo id ed Payment shall be revived and continue in full fo rce
and effect as if such Voided Payment had ne ve r been made . In the eve nt that a Voided Payment is
rec overed fro m CHF . an Event of De fa ult shall be deemed to have exis ted Jlld to be co ntinuing
under the Subordination Agree ment from the date of CHF's initial recei pt of such Voided Payment
until the full amount of such Vo ided Payment is restored to CHF . During any continuance of any
such Even t of Default. this Subordination Agreem ent shall be in full tcm e and effect with res pect to
the Deed Restrictio ns or the Repurchase Opt io n. Upon the payment and sati sfact ion in full in cash
o f all of the CHF Loan. which payment shall be fi nal and not avoidable. thi s Subo rdination
Agreeme nt will aut omat ically te rminate ,vi th out any add itio nal actio n by any parry heret o.
I 0. Notices. Exce pt :is oth erwise exp ressly prov ided herein. any no tice. ord er. instruction.
reque ~t or other co mmunicat io n required or permitted to he given under thi s Agree ment shall be in
writing and dee med to ha ve been properl y given whe n Je'ivered in person. or when sent by telcco py
or ot her el ectronic means and electro nic confirmation of ,,rr or-rree rec eipt is rec eived or upon recei pt
of notice se nt by cenified or regis tered L'nited Sta te s mail re turn receip t reque sted. pos ta ge prepaic.
addre ssed to the parry at the addre ss set fo nh below suc h p.Jrty's name at the end or this . .\greement .
Any parry may change it s address fo r notice s in the manner se t fo nh above.
I I. Cons truc tion. This Subo rdinatio n Agreement shall be gove rne d by and in terpreted in •
•
accordance with the laws of the Stat e of Co lorado . The headings used in this Subordination
Agreement are fo r co nvenience of referenc e only and shall not affect the construction hereof
Whene ver the co nt ext requires or permit s. the singular shall include the plural. the plural shall includ e
the singular. and th e masculine. feminine and neut e.r shall be freely interchangeable .
12. Waiver of ./urv Trial . EACH OF THE PARTlES WAIVES ITS RIGHT TO A JURY
TRIAL W!TH RESPECT TO A;''IY ACTION OR CLAIM ARISING OUT OF ANY
0¥SPUTF, IN CONNECTION WITH THIS SUBORDINATION AGREEMENT, ANY
RIGHTS . OR ORLIGATJONS HEREUNDER OR THE PERFORMANCE OF SUCH
RIGHTS AND OBLIGA noNS.
13 . ~t,r.tbi!in: if mt provision of this Subordination Agreement or any lien or other right
bere lllid¢r smill be beld 10 be invalid, illegal or unenforceable under applicable law in any jurisdiction,
such pr~,vr,;~\'l. l.len. r other right shall be ineffec tive only to the extent of such invalidity, illegality or
unenfon:eabilh, • vhich shall not affect any othe r provisions herein or an y other lien or right gr.anted
hereby or the ,alidity, legality or enforceability of such provision, lien or right in any other
jurisdiction.
14. MisceUaneous. This Subordination Agreement may be executed in several co unterparts and
by each pany on a separate counterpart, each of which when so executed and delivered shall be an
original, and all of which together shall constitute one instrument. In roving this Subordination
Agreement , it shall not be necessary to produce or account for more than one such counterpart
t ign;,-1/ by the party against which enforcement is sought.
15 . Waivers/Modifications . CHF may, in its sole and absolute discretion, waive any provisions of
this Subordination Agreement benefiting CHF : provided, howe ver, that such waiver shall be effective
only if in writing and signed by CHF and shall be limited to the specific provision or provisions
expressly so waived. Any modification or amendment to this Subordination Agreement must be
made in ··, citing and signed by the party adversel y affected .
16. ASsi gnment/Binding Effect. This Subordination Agree ment shall be binding upon the
successors and assigns of Englewood and CPI and shall inure to the benefit of CHF , CHF's
succe ssors and ass igns . but shall not otherwise create any ri ght s or benefits for any third party .
17. Enforcement Ex pe nses Including Attomevs ' Fees . Each party shall bear its own exp enses of
negotiat ion and implement atio n of this Subordination Agreement. including anomeys ' f es. If any
legal action or other proceeding is brought fo r the enfo rcement of this Subordination Agreement , or
because o f an alleged dis pute. breach. default. or misrepresentation in connection with any of the
pro vis ions of this Subordination Agreement. the successfu l or prevailing party shall be entitled 10
reco ve r reaso nable attorneys' fees and other cos ts incurred in that action or pro cee ding , in addition
to any other relie f to which such parry may be entitled .
18 . Complete Agreement . This Subordination Agreement is intended by the part ies as a final
• express ion of their agreement regarding the subject matter hereat'. The partie s intend this
Subo rdinat io n Agreement to be a c omplete and exclusive statement o f the tent1S and conditio ns of
such agreement and the subject matter hereo f, except (a) where express references are made in this
S ubordinat io n Agreement to tbe pro vis ions of the Deed and CHF Loan Documents ; or (b) where
there is an ambiguity in this Subordination Agreement , or a conflict between the tentlS o f this
Subordination Agree ment. in which instance the panics agree that reference may be made to the
provisio ns of the Loan Documents to c larify this Subordination Agreement or reso lve ar,y such
conflJ ... ' ..
IN WITNESS WHEREOF . the panics hereto have executed this Subordination Agreement as of
the date first abo\'. wiitten.
1300 Broadway
Denver, Colorado 80203
COLORADO PRES ER VA TI ON . lNC .
a Colorado not-for-profit corporation
By:C\ :!,;AA! o Uµ...
1
Fri~Gree.V
Title : PreMnt
1900 Wazee St.. Suite 360
Denver. Co lorado 80202
THE CITY OF ESGLEW OO D.
a Co lo rad o Ho me Rul e Munic :pali ty
By :--------------
Name: ____________ _
T itl e : Mayo r
l 000 Englewood Parkwa y
Engle wood. Colorad o 80 1 10
6
•
•
•
•
•
COUNCIL COMMUNICATION
Date ARenda Item Subject
O rdi nance approv in g a sub ordin ati on
Ma\' 3, 2004 11 a iii
ag ree ment w ith th e Col orado
H is torica l Foun da ti on
INITIATED BY I STAFF SOURCE ...
Cill' M Jnage , ·-Office I Michae l Fl aherty, Ass isl anl City Manage r -
COUNC IL GOAL AN D PREV IOUS COUNCIL ACTION
In 1999 City Coun cil auth orize d th e purchase of th e Th omas Sk errill H o us e and th e surro und four lots in
o rd er 10 preserve 1:1:, ! ,,l ori ca l site. In Novembe r of 2002, Coun ci l ap p rove d an opti on l o urchas e th e
Sketrl:t House w i1I, • ·J lorado Prese rvati on, In c (C PI). Thal CPI exe rcised opti o n on Apri l 1, 2003, at ,-,hich
tin,e titl e w as fo rm all y tran sferred, ba se d on the terms of th e o pti on ag ree ment, incl udi ng pay ment of
$60,000 to th e City.
·11 :e purpose of thi s ac ti on is to all ow fo r a subord inati on ag ree ment in favo r of th e Colorad o Histori c
Fo undati o n Revo lving Loan fund, in ord er l o secure th eir $19 7,000 improvement loa n 10 CPI. This ac ti o n
w ill relinquish th e City's right in th e de ed f r repurchase of th e Ske rrill House if rehabilitation is not
compl eted . In exc hange, CPI ha s agree d to fil e an histori cal ease ment in fa vor of th e City and the Colora do
Histori~a l So cie ty, w hich w ill pro tec t the City's original go al o f rehabilation and prese rvati o n of the stru cture
a~ an historical property . Th e stabili zati on and rehabilitati on of th e Skerritt House is currently undeiway.
RECOMMENDED ACTl")N
Sta ff recommend s Coun cil approva l 9f th e o rdinance approving thi s subordin ati o n agr ee ment.
BACKGROUND, ANALYSIS AND ALTERNATIVES IDENTIFI ED
Th e City purchase d th e Skerritt H ouse in ord er to pres erve th e buildin g as a hi storica l prop erty. In 20ul ,
CPI submitted an opti o n to purchase tlie Sk erritt H o use th at would all ow CPI to mark et th e property to a
third parti es fo r a use permitt ed under th e current zo ning. CPI has sec ured a grant fr o m th e Colorad o
H isto ri ca l Fo undati on and a loa n fr om th e Colo rado H is tori ca l Fo undati on (C HF ) Revo lvin g Loa n Fund to
stabili ze lhe stru cture, rehabilitate th e ex teri o r and prepare th e int eri or for adaptive reuse by a futur e
owner. In o rd er l o sec ure th e loa n fr om th e CH F, CPI ha s requ es ted th at th e City subordin ate th e
rep urchase language in th e sa le ag ree ment. In exc hange th e City has requ es ted and receive I ag ree ment
fro m CPI th at an historica l ease ment in fa vor of th e City w ill be record ed aga in st th e property. Th is
ease ment w ill similarl y protec t th e int er~;I of th e City, as the repurchas e ag ree ment would, in Ih at th e
ease ment p ro hibits chang es to th e improvements o f th e prope rty th al are not consis tent w ith th e hi stori ca l
charac ter and signi fi cance of th e prope rty. Th e CHF grant and loan document s require th al th e
im pr L . ern ent s be co mpl eted per th e term s of th ose ag ree ment s.
FINANC IAL IMPACT
None
LIST OF ATTAC HMENTS
Coun cil Bill for an O rdi na nce
O pt io n to Purchase Agree men t