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HomeMy WebLinkAbout2015-106 AMS - Subordination, Attornment and Non-Disturbance Agreement Please return this copy to the Clerk to the Board's _ office for permanent agenda file. When recorded return to: Snell&Wilmer L.L.P. One Arizona Center 400 East Van Buren Phoenix,Arizona 85004-2202 Attention: Craig K. Williams,Esq. For Recorder's Use SUBORDINATION,ATTORNMENT AND NON-DISTURBANCE AGREEMENT DATE: ,2014 PARTIES: The undersigned lessee ("Lessee?); and U.S. BANK NATIONAL ASSOCIATION, a national banking association, whose address is 101 North First Avenue, Suite 1600, LM-AZ-X16E, Phoenix, Arizona 85003 ("Lender"). RECITALS: A. Lender has made a loan (the "Loan") to the Borrower who is the lessor under the Lease,described below Hillsborough Commons LLLP ("Borrower.'). B. As security for repayment of the Loan and performance of Borrower's obligations to Lender, Borrower has executed and delivered to Lender, among other things, a deed of trust, which will be recorded in the official records of the applicable county (the "Deed of Trust"), granting to the Lender a lien on the real property described in Exhibit A attached hereto and made a part hereof by this reference(the"Property'). C. Lessee claims an interest in the Property by virtue of a Lease Agreement by and between Borrower, Hillsborough Commons LLLP, as Landlord_and Lessee, Orange County Government, as Tenant, (the "Lease") made by and between Lessee and Borrower, as lessor, dated 7/25/2008, covering a portion of the Property and improvements thereon. i D. Lender has agreed to make the Loan to Borrower,but only if,among other things, Lessee subordinates any and all right,title, and interest it now has or hereafter acquires in and to the Property to the lien of the Deed of Trust. NOW, THEREFORE, in consideration of Lender's agreement to make the L_oan, the parties agree as follows: 20380644 AGREEMENTS: 1. Subordination. Lessee hereby completely and unconditionally subjects and subordinates any and all right, title, liens, claims; and interest it now has or hereafter acquires in and to the Property whether pursuant to the Lease or otherwise to Lender's liens on and claims against the Property. Lessee agrees that its subordination hereunder shall apply to the full extent of all principal advanced under the Loan, together with all accrued and accruing interest, and together with all other amounts secured by the Deed of Trust, including without limitation, all attorneys' fees and costs incurred by Lender in connection with the Loan or the Property. Lessee hereby agrees that the Deed of Trust and any and all claims or liens her acquired by Lender in and to the Property are prior and superior to any and all right,title, claims, liens, or interest now held or hereafter acquired by Lessee in and to the Property. This subordination shall extend to any and all increases, renewals, extensions, modifications, substitutions, and consolidations of the Deed of Trust, of the Loan, and of any other documents securing the Loan, and Lender may, without notice or demand, and without affecting the subordination hereunder, (a) renew, compromise, extend, accelerate, or otherwise change the time for payment of or otherwise change the terms of the Loan or any part thereof, including, without limitation, increases or decreases in the principal amount of the Loan and the interest rate thereon, (b)waive or release any part of its lien on the Property, (c) apply proceeds from the sale of the Property and direct the order or manner of sale thereof as Lender, in its discretion, may determine,and(d) assign its rights hereunder or under the Loan, or both,in whole or in part. Lessee further declares, agrees and acknowledges that, in making disbursements of the Loan, Lender has no obligation or duty to,nor has Lender represented that it will,see to the application of such proceeds by the person or persons to whom they are disbursed by Lender, and any application or use of such proceeds for purposes other than those provided for in connection with the Loan shall not defeat the subordination made in this Agreement,in whole or in part. 2. ' Reliance. Lessee acknowledges that the Loan and/or advances thereof would not have been made by Lender without the giving of this Agreement by Lessee and further acknowledges that Lender is relying upon this Agreement in making the Loan and/or advances thereof to Borrower. 3. Transfer of Lease. Any transfer or encumbrance of the Lease or Lessee's interest therein shall be subject to the terms of this Agreement. Lessee hereby agrees to notify any purchaser,assignee, or encumbrancer of the Lease of the terms of this Agreement. 4. Representations and Warranties. Lessee represents and warrants to Lender that: (a) The Lease is a commercial lease,is in full force and effect,and has not been amended or modified in any way; and there are no documents or written agreements between Lessee and Borrower with respect to the Lease,except those disclosed herein; (b) Lessee's interests under the Lease have not been assigned or transferred,whether for purposes of security or otherwise, and Lessee has all the requisite power and authority to enter into this Agreement with Lender; -2 - 20380644 (c) Lessee-will faithfully perform all obligations of the lessee under the terms of the Lease; (d) Lessee has prepaid no rent except as specifically set forth in the Lease; and (e) To the best of Lessee's knowledge, no uncured event of default or breach on the part of Borrower or Lessee has occurred under the Lease, and no event has occurred which gives Lessee the right to terminate the Lease or otherwise claim defenses, offsets or damages. 5. Covenants. Lessee covenants and agrees that: (a) . Lessee will not pay any installment of rent or any part thereof more. than one(1)month prior to the due date of such installment; (b) No extension or modification of the Lease shall be of any force or effect unless Lender has specifically consented thereto in writing; (c) Lender may enter upon the Property and inspect the same at any reasonable time;and (d) Lessee will at any time and from time to time execute, deliver,and acknowledge to Lender or to any third party designated by Lender, within thirty (30) days following Lender's written request therefor, a statement in writing certifying whether the Lease is in full force and effect, that Borrower is not in default thereunder(or specifying any defaults by Borrower which Lessee alleges), that rent has not been prepaid more than one (1) month in advance, and specifying any further information about the Lease or the Property which Lender or said third party may reasonably request. 6. Defaults. Lessee covenants and agrees to give Lender a copy of any notice of default under the Lease served upon the Borrower as landlord. Lessee further covenants and agrees that if Borrower shall have failed to cure such default within the time provided for in the Lease then Lender shall have an additional thirty (30) days to cure such default or if such default cannot be cured within that time, then such additional time as may be necessary if within such thirty (30) days Lender has commenced and is diligently pursuing the remedies necessary to cure such a default (including, but not limited to, commencement of foreclosure proceeding if necessary to effect such cure), in which event the Lease shall not be terminated while such remedies are being so diligently pursued. Lessee agrees that the correction of any such default by Lender shall have the same effect and be treated as a correction by Borrower. 7. Attornment. If the interests of Borrower shall be transferred by reason of foreclosure or exercise of power of sale or other proceeding for enforcement of the Deed of Trust, or by reason of a deed in lieu of foreclosure,Lessee shall be bound to the person acquiring the interests of landlord(the"Purchaser")under all of the terms, covenants, and conditions of the Lease for the balance of the term thereof remaining and any extensions or renewals thereof which may be effected in accordance with any option therefor in the Lease, with the same force -3 - 20380644 and effect as if the Purchaser were the lessor under the Lease. Lessee does hereby attorn to the Purchaser,including Lender, if it is the Purchaser, as its landlord, said attornment to be effective and self-operative without the execution of any further instruments upon Purchaser succeeding to the interest of the landlord under the Lease. 8. Non-Disturbance. Provided Lessee is not in default in payment of rent, taxes,_utility charges, or other sums payable by Lessee under the terms of the Lease, nor in default in the performance of any other covenant or provision of the Lease or this Agreement, and provided Lessee is in possession of the portion of the Property subject to the Lease,then the right of possession of Lessee to the portion of the Property subject to the Lease shall not be affected or disturbed by Lender in the exercise of any of its rights or remedies under the Deed of Trust. 9. Direct Payment. Lessee agrees that upon receipt of written request therefor by Lender, rental payments will be made directly to Lender or its order at such place as Lender shall direct. Lessee is authorized to accept such request from Lender and waives all claims against Lessee for any sums so paid at Lender's request and direction. 10. Liability of Lender. Notwithstanding anything to the contrary contained in this Agreement, Lender and its successors and assigns shall not, by virtue of this Agreement, be or become subject to any liability or obligation to Lessee under the Lease or otherwise,unless Lender or its successors and assigns shall obtain title to the Property, by foreclosure or otherwise; and,moreover, Purchaser in acquiring the interest of Borrower as a result of any such action or proceeding, and its successors and assigns, shall not be: (a) liable for any act or omission of any prior landlord under the Lease (including Borrower); or (b)liable for any damages or other relief at to any latent or patent defects in construction with respect to any portion of the Property; or (c) subject to any offsets or defenses which Lessee might have against any prior landlord under the Lease (including Borrower); or (d) bound by any amendment or modification of the Lease made without Lender's prior written consent; or (e)bound by, or responsible for, any security deposit paid by Lessee (unless delivered to and held by Lender); or(f)bound by or responsible for'or affected by any purchase option contained in the Lease, which provisions shall be of no force and effect upon the Lender or its successors or assigns; (g) obligated to construct any improvements on the Property (provided that if Purchaser fails to construct improvements as required under the Lease, Lessee may terminate the Lease); or (h)bound by, or responsible for, any other term or provision of the Lease which is personal to the Borrower or which may not reasonably be performed by Purchaser or its successors and assigns in the ordinary course of business. Regardless of anything in the Lease or this Agreement to the contrary, in acquiring the interest of Borrower as a result of such action or proceeding, Purchaser shall not have any obligation or liability beyond its interest in the Property. Lessee shall look exclusively to Purchaser's interest in the Property for payment and discharge of any of Purchaser's obligations under this Agreement or under the Lease. Lessee shall not collect or attempt to collect any judgment based upon such obligations out of any other assets of Purchaser. In addition, upon any sale or transfer of its interest in the Property, Purchaser shall have no further obligation under the Agreement or the Lease with respect to matters occurring after such sale or transfer. Nothing contained in this Section shall impair, affect, lessen, abrogate or otherwise modify the obligations of Borrower to Lessee under the Lease. -4- 20380644 11. No Asuum tion. Notwithstanding any other provisions contained in this Agreement, Lender does not assume any responsibility or liability for any acts or conduct by any other person, including, but not limited to, a purchaser at foreclosure or trustee's sale or grantee under deed in lieu of foreclosure. 12. Notices. Whenever and wherever in this Agreement, the Lease, or in any proceeding involving the foreclosure or attempt to foreclose pursuant to the Deed of Trust it shall be required or permitted that a notice or demand be given, such notice or demand shall be in writing and be deemed to have been given or served upon receipt or refusal of receipt after being mailed, postage-prepaid, by certified, registered, or express mail, return receipt requested, or when delivered in person to the appropriate address set forth above or to such other address as may be hereafter designated by any party thirty (30)-days in advance by proper notice to the other. 13. Amendments. No amendment or modification of this Agreement shall be valid or binding unless in writing, signed by the party or parties to be bound thereby. 14. No Merger. The parties hereto agree that unless Lender shall otherwise consent in writing, Borrower's estate in and to the Property and the leasehold estate created by the Lease shall not merge, but shall remain separate and distinct, notwithstanding the union of such estates either in Borrower or Lessee or any third party by purchase, assignment or otherwise. 15. Further Certificates. Within ten (10) days after Lender's request, Lessee shall deliver to Lender and to any person designated by Lender, estoppel certificates executed by Lessee, certifying (if such is the case) that the Lease is in full force and effect, that there are no defenses or offsets outstanding under the Lease (or stating those claimed by Lessee, as the case may be)and such other information about Lessee or the Lease as Lender may reasonably request. 16. Nondisturbance Agreement. This Agreement satisfies any condition or requirement in the Lease relating to the granting of a nondisturbance agreement from Lender. 17. Severability: Choice of Law. In the event any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall, at the option of the Lender, not_affect any other provisions of this Agreement, but this Agreement shall be construed as if such invalid,illegal, or unenforceable provision had never been contained herein. _ This Agreement shall be governed by and construed according to the internal law of the State in which the Property is located. 18. Successors. This Agreement shall bind and inure to the benefit of the parties and their respective successors and assigns. 19. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document. Signature pages may be detached from the counterparts and attached to a single copy of this Agreement to physically form one document. -5- 20380644 i IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. Orange County Government By: Name: a> Title: t I ,606 c "Lessee" -6- 20380644 STATE OF I )ss. County of ) The foregoing instrument was acknowledge before me this 5V& day of Q_(' e E 2014, by L ar Of the U�r of a(n) , on be of the C otary Public C'mm 1���t/1 IfeS V Z?/ Donna ploy Notary.Public Guilford County North Carolina M Commi pion Expires 20350644 U.S. BANK NATIONAL ASSOCIATION, a national banking association By: Name: Title: "Lender" 20380644 STATE OF ) )ss. County of The foregoing instrument was acknowledged before me this day of ,2014,by , a of U.S. Bank National Association, a national banking association,on behalf of the association. Notary Public i 20380644 EXHIBIT A Legal Description HILLSBOROUGH COMMONS SHOPPING CENTER Being all that tract or parcel of land lying in Hillsborough Township, Orange County, Hillsborough, North Carolina and being more particularly described as follows; Beginning at a point in the westerly margin of the new right-of-way of N.C, Secondary Road No. 1192, said point being located at the intersection of the northerly boundary of the property of Delmar M. Brown (now or formerly) as described in Book 207 at Page 399 of the Orange County Registry with said westerly margin of said new right-of-way; thence from the point of beginning with a boundary of the property of Delmar M. Brown(now or formerly) N 87-34-07 W 908.78 feet to a concrete monument, said monument being a corner of the property of Delmar M. Brown (now or formerly), and the property of Mrs- Lazy Lloyd(now or formerly); thence with boundaries of the properties of Mrs. Gary Lloyd(now or formerly), CCLC.Development Group (now or formerly) as described in Book 655, Page 389 of the Orange County Registry, and Geraldine McKel (now or formerly) as described in Book 216, Page 86 of the Orange County Registry N 05-12-30 E 840.67 feet to a point,said point being in the line of the property of Geraldine McKel (now or formerly), thence with the property of Geraldine McKel(now or formerly)and with a line of the property of Lethea S. Sawyer(now or formerly)as described in Book 99 at Page 186 of the Orange County Registry N 88-01-42 E 391.79 feet.to a point in the westerly margin of the new right-of-way of N.C. Secondary Road No. 1192; thence-with the westerly margin of said new right-of-way S 30-0034 E 233.05 feet to a point;thence continuing with said right-of-way with the are of a circular curve to the right.having a radius of 1225.13 feet (which curve is subtended by a chord bearing S 26-07-22 E for a distance of 91.80 feet) an arc distance of 91.82 feet to a point in the northerly boundary of the property of Edward E. Norris (now or formerly)as described in Book 251,Page 1062 of the Orange County Registry; thence with the boundaries of the property of Edward E. Norris(now or formerly) the following three (3)courses and distances: (1)S 6344-11 W 2.18.59 feet to an existing iron pipe; (2)S 26-11-24 E 149.86 feet to an existing iron pipe,and(3)N 63-45 02 E 203.53 feet to an existing iron pipe in the westerly margia of the new right-of way of N. C. Secondary Road No. 1192; thence with the westerly margin of the said new right-of-way the.following four (4) courses and distances; (1)with the arc of a circular curve to the right having a radius of 1225.13 feet(which curve is subtended by a chord.bearing S 16-24-45 E for a distance of 22.12 feet) an arc distance of 22.12 feet to a point; (2)S 15-25-53 E 192.52 feet to a point; (3)with the arc of a circular curve to the left having a radius of 434.51 feet.(which curve is subtended by a chord bearing S 29-26-34 E for a distance of 231.41 feet)an arc distance of 234.24 feet to a point; and(4) S 47-59-28 E-78.63 feet to the point or place of BEGINNING. Containing approximately 11.8230 acres as shown on ALTA/ACSM Land Title Survey prepared by Henley Surveying and Mapping Company,dated December 9, 1996(rob No. 948). y 20380644