LANDLORD ESTOPPEL, NON-DISTURBANCE AND RECOGNITION AGREEMENT

Transcription

1 LANDLORD ESTOPPEL, NON-DISTURBANCE AND RECOGNITION AGREEMENT This Landlord Estoppel, Non-disturbance and Recognition Agreement ( Agreement ) is made as of December, 2012, by and between Great Western Bank, Shawnee Mission Parkway, Shawnee, Kansas ( Lender ), and Westwood Foundation, a Kansas not-for-profit corporation, Westwood City Hall, 4700 Rainbow Blvd., Westwood, Kansas ( Foundation ), and The City of Westwood, Kansas, Westwood City Hall, 4700 Rainbow Blvd., Westwood, Kansas ( City ), and Woodside Racquet Club Management, Inc., a Kansas corporation ( Borrower ). WHEREAS, City is the fee owner of the real property and improvements legally described on Exhibit A attached hereto and made a part hereof ( Land and Improvements ); and WHEREAS, City, as landlord, and Foundation, as tenant, are parties to a certain Lease dated May 1, 1981, as thereafter amended and extended by the Modification of Lease dated November 11, 2010, and the Second Modification of Lease dated, 2011 ( Lease ) by which the Foundation holds certain leasehold rights concerning the Land and Improvements as evidenced by the Memorandum of Lease recorded in Vol at Page 732; and WHEREAS, Foundation, as sub-landlord, and Borrower, as subtenant, are parties to that certain Land and Building Sublease Agreement dated December 6, 2010 (aka the Amended, Restated and Consolidation of Sub-Lease Agreements by and between Westwood Foundation, Forty-Seventh Partners, L.P. and Woodside Racquet Club Management, Inc. ( Sublease ) concerning the Land and Improvements; and WHEREAS, Borrower has made, executed and delivered to Lender a Promissory Note ( Note ) in consideration for a construction loan and a permanent loan with a term of 5-10 years ( Loan ), which Note is secured by, among other things, a Leasehold Mortgage and Security Agreement (which Leasehold Mortgage and all amendments, renewals, modifications, replacements, substitutions, extensions and consolidations thereof and all re-advances thereunder and additions thereto approved consistent with this Agreement are referred to as the Mortgage or Leasehold Mortgage ) encumbering the Premises, as that term is defined in the Leasehold Mortgage ( Premises ) ; and WHEREAS, Lender, Borrower, City and Foundation desire to confirm their understanding and agreement with respect to the Lease, Sublease, Leasehold Mortgage, and Premises.

2 NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, Lender, Borrower, City and Foundation hereby agree and covenant as follows: Lease: 1. The City represents, warrants, covenants and agrees as follows with respect to the (a) As of the date hereof, to the best of its knowledge, Foundation is in full compliance with all of the terms and conditions of the Lease and no condition exists which, of itself, or upon the lapse of time or giving of notice (or both), might create an event of default under the Lease. (b) The City has no objection to and hereby consents to the Loan and Leasehold Mortgage. City hereby waives any event of default which might occur under the Lease as a result of the Loan or execution of the Leasehold Mortgage by Borrower. (c) Except as described herein, the Lease has not been modified or amended and constitutes the entire agreement between the City and Foundation. (d) The City has not assigned, pledged, conveyed, transferred, sold, encumbered or mortgaged its interest in the Lease or the Land and Improvements and there are no mortgages, deeds of trust or other security interests now encumbering the City s fee interest in the Premises. (e) No third party has any option or preferential right to purchase all or any part of the Land Landlord and Improvements arising out of an agreement with the City. (f) The termination date of the Lease with renewal periods is June 30, All Rent currently due and payable by Foundation has been paid in full. (g) Commencing July 1, 2001 the Foundation has three (3) consecutive automatic renewal periods of ten (10) years each and thereafter four (4) consecutive automatic renewal periods of five (5) years each. Foundation is currently in the first 10-year renewal period and, through the above mentioned Modification of Lease, has already provided all necessary notice for the second 10-year renewal period. (h) A copy of any notice given by the City to Foundation in accordance with the Lease shall be simultaneously given to Lender or such other party as Lender may direct by written notice to the City. The City shall give Lender all notices as required under the Lease to be given to Foundation. The City shall afford Borrower and/or Lender all rights to cure the Foundation s default provided under the terms of the Lease. (i) In the event Foundation defaults under the Lease and the Lease is terminated prior to cure of such defaults, the City will treat the Sublease as a direct lease between the City and Borrower and allow the Sublease and Lender s Leasehold Mortgage to remain in full force and effect. (j) The City shall allow the Lease to automatically renew from year to year without any action by the City or Foundation as long as the Leasehold Mortgage remains in effect in order to prevent the Lease from expiring on its own terms through and including the expiration of the Lease on June 30, Subject to Section 1(h) above, the City declares its intention with the Foundation that neither of them shall recognize the termination or expiration of the Lease at any time while the Leasehold Mortgage and/or the Sublease remains in effect, unless the City complies with (i) above. (k) The City consents to the agreements made by Foundation in Section 2 below and further agrees to acknowledge the rights of Lender as set forth below in Section 2(k). 2. Foundation represents, warrants, covenants and agrees as follows: 2

3 (a) Foundation has received no notice from the City that Foundation is in default of the Lease, nor that the City intends to terminate the Lease. (b) The termination date of the Lease with renewal periods is June 30, (c) As of the date hereof, to the best of its knowledge, Borrower is in full compliance with all of the terms and conditions of the Sublease and no condition exists which, of itself, or upon the lapse of time or giving of notice (or both), might create an event of default under the Sublease. (d) Foundation has no objection to and hereby consents to the Loan and the Leasehold Mortgage. Foundation hereby waives any event of default which might occur under the Sublease as a result of the Loan or execution of the Leasehold Mortgage by Borrower. (e) Except as described above, the Sublease has not been modified or amended and constitutes the entire agreement between the Foundation and Borrower. (f) Except for the first leasehold mortgage, Foundation has not assigned, pledged, conveyed, transferred, sold, encumbered or mortgaged its interest in the Lease, Sublease, or the Premises and there are no mortgages, deeds of trust or other security interests now encumbering the Foundation s leasehold interest in the Premises. (g) No third party has any option or preferential right to purchase all or any part of the Premises arising out of an agreement with the Foundation. (h) The termination date of the Sublease with renewal periods is June 30, All Rent currently due and payable by Borrower has been paid in full. (i) Commencing July 1, 2001 the Borrower has three (3) consecutive automatic renewal periods of ten (10) years each and thereafter four (4) consecutive automatic renewal periods of five (5) years each. (j) A copy of any notice given by Foundation to Borrower in accordance with the Sublease shall be simultaneously given to the City and the Lender or such other party as Lender may direct by written notice to Foundation. Foundation shall give Lender all notices as required under the Sublease to be given to Borrower. Foundation shall afford Lender no less than an additional sixty (60) days after written notice to cure any and all defaults of Borrower under the terms of the Sublease after Borrower fails to cure a default. (k) Any notice to Foundation given in accordance with the Sublease may be sent to Foundation at the address set forth herein. (l) If the interest of Borrower shall be transferred to and owned by the Lender or another party (each, a Successor Sub-tenant ) by reason of foreclosure or other proceedings brought by the Lender in lieu of or pursuant to a foreclosure, or by any other manner, and the Successor Sub-tenant succeeds to the interest of Borrower under the Sublease, or if the Borrower shall be adjudged bankrupt and the Borrower s obligation under the Sublease thereby disaffirmed, and the Successor Sub-tenant gives written notice to Foundation within thirty (30) days of its assumption of Borrower s interest, the Sublease shall become a direct lease binding upon Foundation and the Successor Sub-tenant, in accordance with all of the terms, conditions and covenants of the Sublease for the balance of the term thereof remaining, with the same force and effect as if the Successor Sub-tenant were the subtenant under the Sublease, to be effective and self-operative immediately upon the Successor Sub-tenant succeeding to the interest of Borrower under the Sublease, without the execution of any further instrument on the part of any of the parties hereto; provided such Sub-tenant shall not be liable for the past due obligations or default of Borrower under the Sublease. The respective rights and obligations of Foundation and Successor Sub-tenant upon such event, to the extent of the remaining balance of the 3

4 term of the Sublease, shall be and are the same as now set forth therein, it being the intention of the parties hereto for this purpose to incorporate the Sublease in this Agreement by reference by the same force and effect as if set forth at length herein. Notwithstanding anything to the contrary contained herein, in the event Lender, as Successor Sub-tenant, assumes the obligation under the Sublease, Lender shall be entitled to assign or sublease its rights under the Sublease to a third party (subject to the standards required of assignees and the approval rights under Section 13.1 of the Sublease) and be relieved of all liabilities and obligations under the Sublease which accrue after the date of such assignment or sublease. (m) Subject to Section 2(j) above, Foundation shall not, without the prior written consent of the City and Lender, (i) amend, modify, terminate or cancel the Lease or Sublease, (ii) accept a surrender of the Sublease, or (iii) permit the subordination of the Sublease to any mortgage encumbering the fee estate of the Premises except if the City, Foundation, Borrower and fee mortgagee enter into a Subordination, Non-Disturbance and Attornment Agreement, in a form acceptable to Lender. Any such purported action without such consent shall be void as against the holder of the Leasehold Mortgage. (n) This Agreement shall satisfy any and all requirements under the Sublease for providing notice to Foundation of a mortgage encumbering the Borrower s leasehold interest in the Premises. (o) Foundation agrees to take all action necessary to keep the Lease in full force and effect as long as the Leasehold Mortgage is in effect unless otherwise agreed to in writing by the parties to this Agreement. Subject to Section 2(j) above, the Foundation shall assure that the Lease shall automatically renew from year to year without any action by the City or Foundation as long as the Leasehold Mortgage and/or the Sublease remains in effect in order to prevent the Lease from expiring on its own terms through and including June 30, (p) Foundation agrees and acknowledges the Sublease shall automatically renew from year to year after its initial term without any action by the City, Foundation, or Borrower as long as the Leasehold Mortgage remains in effect in order to prevent the Sublease from expiring on its own terms through and including June 30, Subject to Section 2(j) above, the Foundation declares its intention with the City that neither of them shall recognize the termination or expiration of the Sublease at any time while the Leasehold Mortgage and/or the Sublease remains in effect unless otherwise agreed to in writing by the parties to this Agreement. 3. Lender represents, warrants, covenants and agrees as follows: (a) In the event that Borrower defaults under the terms of the Leasehold Mortgage, Lender agrees to provide notice of the default to City and Foundation. (b) In the event Lender becomes the Successor Sub-tenant, Lender will attorn to and recognize the rights of the City and Foundation under the Lease and Sublease, in accordance with the terms and provisions of this Agreement. (c) In the event Lender and Borrower modify the terms of the Leasehold Mortgage, extend the 10 year term of the Loan, or encumber additional collateral subject to the Sublease, Lender agrees to first obtain the prior written consent of the City and Foundation, which consent shall not be unreasonably withheld, delayed or conditioned. Notwithstanding the foregoing, the City s and Foundation s approval is not required for changes to the payment terms under the Note or any other modifications to the Loan that do not affect the 5-10 year term of the $2,035,000 term Note or the collateral of the Loan as it pertains to the Premises. (d) Lender shall not alter or modify existing improvements on the Premises, or construct new improvements thereon, without the prior written consent of the City and or Foundation or as 4

5 otherwise required under the Sublease, in the event the Lender becomes the owner of the sub-leasehold interests in the Premises. 4. Borrower represents, warrants, covenants and agrees as follows: (a) In the event that Borrower seeks to transfer or assign its interest in the Sublease and/or Leashold Mortgage, Borrower agrees to provide the City and Foundation with one hundred eighty (180) days notice of its intended transfer of interest. No transfer or assignment of Borrower s interest shall occur without the express written consent of the City and the Foundation. All terms of this Agreement, the Leasehold Mortgage, the Lease and Sublease will remain in full force and effect in the event Borrower s interest is assigned unless otherwise agreed to in writing by the parties to this Agreement. (b) In the event Lender and Borrower modify the terms of the Leasehold Mortgage, extend the 10 year term of the Loan, or encumber additional collateral subject to the Sublease, Borrower agrees to first obtain the prior written consent of the City and Foundation, which consent shall not be unreasonably withheld, delayed or conditioned. Notwithstanding the foregoing, the City s and Foundation s approval is not required for changes to the payment terms under the Note or any other modifications to the Loan that do not affect the 5-10 year term of the $2,035,000 term Note or the collateral of the Loan as it pertains to the Premises. 5. For so long as the Loan remains outstanding and the Leasehold Mortgage encumbers Borrower s Leasehold interest in the Premises, the City, Foundation, Borrower and Lender covenant and agree as follows: (a) In the event that the Premises encumbered by Lender s Leasehold Mortgage or any part thereof, shall be damaged by fire or other hazard against which insurance is held by Borrower as required under the Lease or Leasehold Mortgage, the following shall apply: (1) In the event the total value of the damage to the Premises is less than an amount equal to fifty percent (50%) of the cost to rebuild and replace the building improvements and structures for the entire Premises, Lender agrees to make any casualty insurance proceeds paid to Lender available to Borrower for the restoration or repair of the Premises encumbered by the Leasehold Mortgage if the following conditions are satisfied or present: (a) Borrower is required to repair or restore the Premises under the Sublease, (b) no Event of Default (as defined in the Leasehold Mortgage) has occurred and is continuing without cure, (c) there are sufficient casualty insurance proceeds to rebuild the Premises and if there are not sufficient proceeds, Borrower shall deposit with Lender such additional funds as are necessary to complete the restoration and repair, (d) the Premises can be rebuilt to substantially the same or better condition that pre-existed the casualty, (e) the repair and restoration of the damaged improvements commences no less than four (4) months after the casualty event, (f) there is no lawsuit filed claiming a right to such proceeds or claims made which would prevent use of the proceeds for rebuilding and restoration, and (g) Borrower carries sufficient business interruption insurance (naming Lender as the loss payee) at all times in an amount sufficient to pay the Indebtedness Secured Hereby and Borrower s insurer delivers to Lender sufficient assurance that the business interruption proceeds are available to be paid upon Lender s demand for same. (2) In the event the total value of the damage to the Premises is an amount equal to fifty percent (50%) or more of the cost to rebuild and replace the building improvements and structures for the entire Premises, or in the event any of the conditions in (1) (a) through (1) (g) above are not satisfied, the insurance proceeds to which Lender is entitled (as provided herein) may, at the sole discretion and option of Lender, be applied to the cost of restoration of the Premises and Borrower s sub-leasehold interest therein or applied to payment of the Loan and any amounts secured by the Leasehold Mortgage. 5

6 (3) To the extent insurance proceeds are to be applied to the cost of restoration of the Premises as described above, such proceeds shall be retained by Lender and disbursed from time to time consistent with Lender s construction lending policies and procedures, including, without limitation, requirements that Lender be furnished with (1) satisfactory evidence of the estimated cost of completion of the restoration, repair, replacement and/or rebuilding, (2) satisfactory evidence that sufficient funds are available to complete the proposed restoration, repair, replacement and/or rebuilding, and (3) such architect s certificates, waivers of lien, contractor s sworn statements, title insurance endorsements, bonds, plats of survey and other reasonable evidence of cost, payment and performance as Lender may reasonably require and approve. (4) To the extent insurance proceeds are applied by Lender to reduction of the debt owed by Borrower to Lender, Lender shall first look to the insurance proceeds paid from the Personal Property/Contents Insurance, and then to the insurance proceeds paid from the Business Interruption Insurance carried by Borrower and Lender shall not be entitled to Casualty Insurance proceeds unless proceeds made available to Lender from the Personal Property/Contents Insurance and Business Interruption Insurance are not sufficient to then retire the debt owed to Lender. (b) Notwithstanding anything to the contrary contained herein, in the event of a casualty and damage to the building improvements, structures and contents, whether the damage is fifty percent (50%) or more or less and notwithstanding whether there is a default under the Leasehold Mortgage, Lender shall be entitled to apply the proceeds from Business Interruption Insurance and Personal Property/Contents Insurance, in its sole discretion, to reduction of the debt owed by Borrower to Lender up to the outstanding balance due under the Loan. The City and Foundation acknowledge and agree that Lender s rights to any Business Interruption Insurance and Personal Property/Contents Insurance up to the outstanding balance due under the Loan are prior and superior to the rights of the City and Foundation. The City and Foundation further waive and release in favor of Lender up to the outstanding balance due under the Loan any claim to casualty insurance proceeds in excess of the insurance required under the Sublease in the event Borrower satisfies its Sublease obligations by restoring or repairing the Premises, and the City and Foundation agree such insurance may be made available to reduce the debt owed Lender. Subject to the rights of the City and Foundation under the Lease and Sublease, the acknowledgements and agreements made in this Section 5(b) by the City and Foundation are not intended to waive any of their rights to insurance proceeds once the Lender s outstanding balance due under the Loan has been paid in full and all remaining obligations owed to Lender by Borrower under the Loan Documents are satisfied. 6. Notices shall be in writing, by registered or certified mail, overnight delivery or hand delivery and the mailing or delivery of notices to the following addresses, or to such other place any party hereto may by notice in writing designate, shall constitute service of notice hereunder: CITY: City of Westwood, Kansas c/o Mayor Westwood City Hall 4700 Rainbow Boulevard Westwood, Kansas With a copy to: Ryan B. Denk McAnany, VanCleave & Phillips, P.A. 10 E. Cambridge Circle Dr., Ste. 300 Kansas City, Kansas Thomas J. Fritzlen, Jr. Martin, Leigh, Laws & Fritzlen, P.C Main Street, Suite 900 Kansas City, Missouri

7 FOUNDATION: Westwood Foundation c/o President Westwood City Hall 4700 Rainbow Boulevard Westwood, Kansas With a copy to: Richard S. Wezler Stephen B. Horner Martin Pringle 6900 College Blvd., Suite 700 Overland Park, Kansas LENDER: Great Western Bank Shawnee Mission Parkway Shawnee, Kansas With a copy to: Jay T. Shadwick Duggan, Shadwick, Doerr & Kurlbaum Oakmont Overland Park, Kansas BORROWER: Woodside Racquet Club Management, Inc. c/o Corporate Registration Services, Inc Metcalf Avenue Suite 300 Overland Park, Kansas With a copy to: Lawrence L. Ferree, III Ferree, Bunn, O Grady & Rundberg, Radom & Ridgway, Chtd 9300 Metcalf Avenue Suite 300 Overland Park, Kansas This Agreement may be executed in any number of counterparts, each of which shall be effective only upon delivery and thereafter shall be deemed an original, and all of which shall be taken to be one and the same instrument, for the same effect as if all parties hereto had signed the same signature page. 8. This Agreement shall be binding upon the parties and their respective successors and assigns and shall inure to the benefit of and be enforceable by the parties and their respective successors, assigns and designees, including, but not limited to, any purchaser at a foreclosure sale or person or entity receiving a deed in lieu of foreclosure (which successors, assigns, designees, purchaser person or entity shall be deemed to be included within the term Lender for purposes of this Agreement). 9. The parties agree to record this Agreement with the Register of Deeds of Johnson County, Kansas. 7

8 10. As used herein, the phrase as long as the Leasehold Mortgage remains in effect shall be deemed to mean Borrower (or its successors or assigns) remains obligated under the terms of the Leasehold Mortgage and Lender retains a lien by its Leasehold Mortgage on the sub-leasehold interest in the Premises or has enforced its remedies and has succeeded to the sub-leasehold interest of Borrower under the Sublease. IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written. Great Western Bank By Name Title STATE OF KANSAS ) ) ss. COUNTY OF ) On this day of December, 2012, before me appeared, to me personally known, who being by me duly sworn, did say that he is the of Great Western Bank, and that the foregoing instrument was signed on behalf of said entity by authority of its Board of Directors, and said acknowledged said instrument to be the free act and deed of said entity. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial seal at my office the day and year last above written. My commission expires: Notary Public Print Name: 8

9 The City of Westwood, Kansas (SEAL) ATTEST: By Name Title: City Clerk STATE OF KANSAS ) ) ss. COUNTY OF ) On this day of December, 2012, before me appeared, to me personally known, who being by me duly sworn, did say that he is the for The City of Westwood, Kansas, and that the foregoing instrument was signed on behalf of said city by authority of the City Council, and said acknowledged said instrument to be the free act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial seal at my office the day and year last above written. My commission expires: Notary Public 9

10 Westwood Foundation, a Kansas not-forpprofit corporation By Name Title STATE OF KANSAS ) ) ss. COUNTY OF ) On this day of December, 2012, before me appeared, to me personally known, who being by me duly sworn, did say that he is the President of Westwood Foundation, a Kansas not-for-profit corporation, and that the foregoing instrument was signed on behalf of said corporation by authority of its Board of Directors, and said acknowledged said instrument to be the free act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial seal at my office the day and year last above written. My commission expires: Notary Public 10

11 Woodside Racquet Club Management, Inc. By Blair C. Tanner, President STATE OF KANSAS ) ) ss. COUNTY OF ) On this day of December, 2012, before me appeared Blair C. Tanner, to me personally known, who being by me duly sworn, did say that he is the President of Woodside Racquet Club Management, Inc., a Kansas corporation, and that the foregoing instrument was signed on behalf of said corporation by authority of its Board of Directors, and said Blair C. Tanner acknowledged said instrument to be the free act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial seal at my office the day and year last above written. My commission expires: Notary Public 11

12 EXHIBIT A Lots 1 and 2, WOODSIDE CLUB COMPLEX, a subdivision in the City of Westwood, Johnson County, Kansas. 12