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HomeMy WebLinkAboutPCDC Resolution 2004-01 01/26/2004RES®LUTI®IV 2004-O1 PETALUMA COMMUNITY DEVELOPMENT COMMISSION APPROVING AND AUTHORIZING THE EXECUTION OF A FIRST AMENDMENT TO OWNER PARTICIPATION AGREEMENT BETWEEN THE COMMISSION AND LOK PETALUMA MARINA HOTEL COMPANY, LLC WHEREAS, the Petaluma Community Development Commission ("Commission") is carrying out the Community Development Plan ("Plan") for the Petaluma Community Development Project ("Community Development Project"); and, WHEREAS, in furtherance of the Community Development Project, Commission and LOK Petaluma Marina Hotel Company, LLC ("Participant") entered into an Owner Participation Agreement dated April 17, 2001 ("OPA"); and, WHEREAS, the OPA provides, among other things, for Participant to develop a hotel and to expand and improve an adjacent parking lot on certain real property located within the boundaries of the Petaluma Community Development Project, Commission to loan certain funds to Participant in order to make development of the hotel project economically viable, and Participant to comply with certain living wage and union card check neutrality requirements in connection with the ownership and operation of the hotel; and, WHEREAS, in accordance with the OPA, Participant has completed the development of the hotel and adjacent parking lot improvements, and Commission has disbursed some of the loan funds to Participant; and, WHEREAS, Participant and Hotel Employees and Restaurant Employees Union, Local 2850 AFL-CIO have entered into a new Memorandum of Agreement governing labor union organizing activities at the hotel, which replaces that certain Memorandum of Agreement dated August 2000; and, WHEREAS, Commission and Participant now desire to amend the OPA to modify Participant's obligations with respect to payment of living wages and labor union organizing activities and to clarify certain other provisions of the OPA. PCDC Resolution 2004-O1 Page 1 NOW, THEREFORE, THE PETALUMA COMMUNITY DEVELOPMENT COMMISSION DOES HEREBY RESOLVE AS FOLLOWS: Section 1. The Commission hereby approves the ,First Amendment to Owner Participation Agreement ("First Amendment") attached hereto as Exhibit A and incorporated herein by reference. Section 2. The Executive Director and Secretary of the Commission are hereby authorized and directed to execute the First Amendment on behalf of the Commission, subject to any minor technical revisions as may be approved by Commission counsel. The Executive Director and Secretary are hereby further authorized and directed to take such further actions and execute such documents, including the First Implementation Agreement to Subordination and Standstill Agreement, as are necessary to carry out the First Amendment on behalf of the Commission. PASSED AND ADOPTED by the Petaluma Community Development Commission this 26'h day of January 2004 by the following vote: AYES: Chair Glass, Harris, Healy, O'Brien, Torliatt NOES: Vice Chair Moynihan _ __ ,_ ABSENT: Canevaro _ - -, .~ -~- - ~ %- ABSTAIN: None _._~ ~ - ~- e ., _ _ _ ~ - - - - 'd Glass, Chair"-- -- ~ -~' -, - - - -, ATTEST: Gayle Petersen, Recording Secretary APPROVED AS TO FORM: Richard R. Rudnansky, Gen oun PCDC Resolution 2004-O1 Page 2 FIRST AMENDMENT TO OWNER PARTICIPATION AGREEMENT This First Amendment to Owner Participation Agreement (the "First Amendment") dated for reference purposes , 2004, is entered into by and between LOK PETALUMA MARINA HOTEL COMPANY, LLC, a California limited liability company ("Participant"), and the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF PETALUMA, a public body, corporate and politic, of the State of California, having offices at 1 1 English Street, Petaluma, California 94953 ("Commission"). RECITALS: Capitalized terms not otherwise defined herein shall have the meaning ascribed to such terms in the Original OPA (defined below). A. Commission and Participant entered into that certain Owner Participation Agreement dated April 17, 2001 (the "Original OPA"). B. In accordance with the Original OPA, Participant has completed the development of the Site and the parking lot adjacent to the Site, and Commission has disbursed some of the loan funds to Participant. C. Participant and Hotel Employees and Restaurant Employees Union, Local 2850, AFL-CIO have entered into a new Memorandum of Agreement governing labor union organizing activities at the hotel, which replaces that certain Memorandum of Agreement dated August 2000. D. Commission and Participant now desire to amend the Original OPA to modify Participant's obligations with respect to payment of living wages, labor union organizing activities and funding of river front enhancement improvements, and to clarify certain other provisions of the Original OPA all as set forth herein. E. Concurrently herewith Commission and Participant's lender, WG Investments, LLC, have entered into a First Implementation Agreement to Subordination and Standstill Agreement, confirming that this First Amendment and the Memorandum of First Amendment to Owner Participation Agreement to be recorded against the Project gs set forth below shall not affect in any way the relative priority of any lien or agreement recorded or entered into prior to this First Amendment among the parties hereto or by and between Commission and WG Investments, LLC. PCDC Resolution 2004-O1 Page 3 AGREEMENTS: NOW THEREFORE, in consideration of the foregoing recitals, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Participant and Commission hereby agree as follows: 1. Amendments to Definitions Under Section 100. The following definition under Section 100 of the Original OPA is hereby revised to read as follows: "Agreement" means the Owner Participation Agreement between Commission and Participant, dated April 17, 2001, as amended by the First Amendment to Owner Participation Agreement, dated 2004. The following definitions are hereby added to Section 100 of the Original OPA: "WG Investments" means WG Investments, LLC, Participant's current primary lender, which provided the financing for development of the hotel and parking lot improvements. "Luna Investments" means Luna Investments LLC, a Delaware limited liability company, the manager of the Managing Member, as defined in the Managing Member's LLC Operating Agreement. "Original OPA" means the Owner Participation Agreement between the Commission and Participant, dated April 17, 2001. 2. Approval of Change in Management and Control. Commission hereby approves Luna Investments as the manager of the Managing Member. 3. Amendment of Section 314.2. Section 314.2 of the Original OPA is hereby deleted in its entirety and restated as follows: "314.2 Labor Union Organizing. Participant covenants and agrees that it shall comply with all of the terms and conditions of that certain Memorandum of Agreement among RIM Corporation, Participant and Hotel Employees and Restaurant Employees Union, Local 2850, AFL- CIO, dated October 29, 2003, governing labor union organizing activities at the hotel." 4. Amendment of Section 314.3. The following sentence is hereby added to the end of Section 314.3 as follows: "Notwithstanding the foregoing, this section 314.3 shall be of no force or effect if a majority of the employees employed at the Project select Hotel Employees and Restaurant Employees Union, Local 2850, AFL-CIO or any other union as their exclusive representative for purposes of collective bargaining. PCDC Resolution 2004-O1 Page 4 Furthermore, this section 314.3 shall be of no force or effect as to any employees who are represented by a union for purposes of collective bargaining in connection with their employment at the Project." 5. Amendment of Section 506. Section 506 of the Original OPA is hereby deleted in its entirety and restated as follows: "506. Funding of River Front Enhancement Projects. In consideration of Commission's provision of the Commission Assistance to Participant, Participant shall pay to the City of Petaluma, for each of the first (1st) through fifth (5th) Operating Years, the sum of Twenty Five Thousand Dollars ($25,000) per Operating Year. Said funds shall be paid by Participant to City no later than thirty (30) days following the start of each of the first (l st) through fifth (5th) Operating Years. Commission shall require that said funds are allocated by the City of Petaluma specifically to fund riverfront related public works and/or parks and recreation projects that will enhance that portion of the riverfront area between the turning basin and Shollenberger Park. Commission shall cause City to consult with Participant and to consider Participant's input regarding the specific riverfront related projects to be undertaken by City prior to City's funding of said projects, however, the final decision as to which projects to undertake shall be made by City in its sole reasonable discretion. Commission shall also cause City to install and maintain, for the duration of the riverfront improvement work, a small sign at the location of the work recognizing the respective roles of the City and the Sheraton Petaluma Hotel in performing and funding such work. Commission acknowledges that the City of Petaluma has received from Participant the first $25,000 installment of the foregoing funding on or about December 19, 2003." 6. Amendment of Section 701. Participant's address for Notices in Section 701 of the Agreement is hereby amended to read as follows: LOK Petaluma Marina Hotel Company, LLC Luna Investments, LLC, Manager of Managing Member c/o Friedemann, O'Brien, Goldberg 8~ Zarian LLP 420 Aviation Boulevard, Suite 201 Santa Rosa, CA 95403 Telephone: (707) 543-4900 Facsimile: (707)543-4910 Attention: Steven M. Goldberg, Esq. The parties may designate by Notice any ofher address or any other person to whom any future Notices are to be sent. 7. Memorandum of First Amendment. Prior to Commission's execution of this First Amendment, Participant shall execute, acknowledge and deliver to Commission for recordation in the Official Records of Sonoma County, California, a "Memorandum of First Amendment to Owner Participation Agreement" in the form attached hereto as Attachment No. 1 . PCDC Resolution 2004-O1 Page 5 8. Conditions Precedent to Effectiveness of First Amendment. This First Amendment shall become effective only upon the satisfaction. of each of the following conditions: (a) Participant shall have executed, acknowledged and delivered to Commission the Memorandum of First Amendment to Owner Participation Agreement. (b) The First Implementation Agreement to Subordination and Standstill Agreement described in Recital E, above, shall have been fully executed and acknowledged by Commission and WG Investments and shall be ready to be recorded immediately following full execution of this First Amendment.. 9. Authority of Participant. Participant and each person executing this First Amendment on behalf of .Participant does hereby covenant and warrant that (a) Participant is duly organized and validly existing under the laws of the State of California; (b) Participant has full power and authority to enter into this First Amendment and to perform all of its obligations hereunder; and (c) each person (and all of the persons if more than one signs) signing this First Amendment on behalf of Participant is duly and validly authorized to do so. 10. Authority of Commission. Commission and each person executing this First Amendment on behalf of Commission does hereby covenant and warrant that (a) Commission has full power and authority to enter into this First Amendment and to perform all of its obligations hereunder; and (b) each person (and all of the persons if more than one signs) signing this First Amendment on behalf of the Commission is duly and validly authorized to do so. 1 1. Ratification. Except as amended hereby, the OPA remains unmodified and in full force and effect. IN WITNESS WHEREOF, the parties have executed this First Amendment on the respective dates set forth below, 2004 COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF PETALUMA, a public body corporate and politic. By: Chair Attest: Commission Secretary PCDC Resolution 2004-O1 Page 6 .. ~ "COMMISSION" ATTEST: By: Commission Secretary APPROVED AS TO FORM: MCDONOUGH, HOLLAND 8~ ALLEN PC By: Commission Counsel 2004 LOK PETALUMA MARINA HOTEL COMPANY, LLC, a California limited liability company By: LOK PETALUMA MARINA DEVELOPMENT COMPANY, LLC, a California limited liability company Its: Managing Member By: LUNA INVESTMENTS, LLC, a Delaware limited liability company Its: Manager By: Thomas H. Birdsall, Manager "PARTICIPANT" PCDC Resolution 2004-O1 Page 7