HomeMy WebLinkAboutAssignment of Right to Repurchase Proceeds Under Purchase Agreement Grantor MW Holdings Auburn SW Block LLC t
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
Snell & Wilmer L.L.P.
1 South Church Ave., Suite 1500
Tucson, Arizona 85701
Attn: Amelie Messingham
[SPACE ABOVE LINE FOR RECORDER'S USE ONLY]
Document Title: Assignment of Right to Repurchase Proceeds under Purchase Agreement
Grantor: MW HOLDINGS AUBURN SW BLOCK LLC
Grantor: CITY OF AUBURN
Grantee: BANK OF AMERICA,N.A.
Legal Description:
Abbreviated Legal Description:
Lots 1 & 2 and ptn Lots 7 & 8, Block 5, Town of Slaughter, Vol. 2,pg. 56
Lots A & B, LLA-05-0015, rec. 20060117002764
Full Legal Description: See Exhibit A attached
Assessor's Tax Parcel Nos.: 781570-0225-04, 781570-0240-05, 781570-0250-02, and 781570-
0265-05
Reference Nos. of Related Documents: 20131227000290 and 20151218001142
4836-6793-7691
ASSIGNMENT OF RIGHT TO REPURCHASE PROCEEDS UNDER PURCHASE
AGREEMENT
THIS ASSIGNMENT OF RIGHT TO REPURCHASE PROCEEDS UNDER
PURCHASE AGREEMENT (the "Assignment") is made as of July _, 2019, between MW
HOLDINGS AUBURN SW BLOCK LLC, a Washington limited liability company
("Assignor"), THE CITY OF AUBURN, a municipal corporation of the State of Washington
("City"), and BANK OF AMERICA,N.A., a national banking association ("Lender").
RECITALS
A. Assignor is the fee owner of that certain real property more particularly described
on Exhibit A attached hereto and incorporated herein by this reference (the "Property").
B. Pursuant to that certain Construction Loan Agreement of even date herewith, by
and between Assignor and Lender (the "Loan Agreement"), Lender has agreed to loan to
Assignor up to Forty-Two Million and No/100 Dollars ($42,000,000.00) (the "Loan") for the
purpose of, among other things, financing Assignor's construction of certain improvements on
the Property. The Loan is or will be evidenced by a Promissory Note in the face amount of the
Loan, and is or will be secured by a Deed of Trust, Assignment, Security Agreement and Fixture
Filing of even date herewith, executed by Assignor, as grantor, for the benefit of Lender, as
grantee, and to be recorded concurrently with this Assignment in the official records of King
County, Washington (as the same may be amended, modified, extended, replaced and/or
renewed from time to time,the "Deed of Trust").
C. Except as otherwise provided in this Assignment, initially capitalized terms used
in this Assignment shall have the meanings set forth in the Loan Agreement.
D. The City conveyed the Property to Assignor by Warranty Deed recorded in the
official records of King County, Washington on December 27, 2013 as Recording No.
20131227000290 (the "Warranty Deed").
E. Certain covenants and restrictions set forth in the Warranty Deed were previously
modified pursuant to that certain Correction Document — Purchase and Sale Agreement [SW
Block] entered into as of December 16, 2015 by and between Assignor, Teutsch Partners, LLC,
and the City, all as disclosed by that certain Memorandum of Correction of Purchase Agreement
and Modification of Warranty Deed recorded December 18, 2015 in the official records of King
County, Washington, as Recording No. 20151218001142, and as amended by those certain
letters dated February 23, 2018 and May 29, 2019, respectively (collectively, as assigned and
amended,the "Purchase Agreement").
F. Pursuant to the Purchase Agreement, in the event Assignor fails to satisfy certain
post-closing obligations as required under Section 15.3 thereof, the City shall have the right to
repurchase the Property from Assignor (the "Repurchase Right"), subject to reimbursement by
the City of the purchase price paid by Assignor for the Property, as well as transfer costs and
other expenses, including costs of construction incurred by Assignor in connection with the
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4836-6793-7691
development of the Property, all as further detailed in Section 13.2.2 of the Purchase Agreement
(collectively,the"Repurchase Proceeds").
G. The Section 15.4 of the Purchase Agreement also provides that Assignor must
notify the City and obtain its approval prior to any encumbrance of the Property.
H. As one of the conditions to agreeing to make the Loan to Assignor, Lender has
required (and Assignor agreed) that Assignor assign, pledge and grant to Lender a lien on and
security interest in all of the right,title and interest of Assignor in the Repurchase Proceeds.
I. Lender has also required (and the City agreed) that the City confirm its approval
of Assignor granting to Lender a lien on the Property pursuant to the Deed of Trust, and
recognize Lender as a"lender"for notice purposes and otherwise under the Purchase Agreement.
NOW, THEREFORE, with reference to the foregoing Recitals, all of which are
incorporated herein by this reference, and in order to induce Lender to enter into the Loan
Agreement and make the advances thereunder, and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereto covenant and
agree as follows:
1. Consent. The City hereby consents to the Loan and the encumbrance of the
Property by Lender pursuant to the Deed of Trust, and to any modification, renewal, extension or
increase of the Loan encumbered by the Deed of Trust. The provisions of this Assignment satisfy
any consent requirement set forth in Section 15.4 of the Purchase Agreement on the part of the
City, and no further consent from, or notice to, the City shall be required prior to any
modification, renewal, extension or increase of the Loan secured by the Deed of Trust.
2. Notices. The City shall deliver a concurrent copy to Lender of any notice
delivered to Assignor in connection with the Purchase Agreement. Without limiting the
foregoing, the City hereby confirms that pursuant to Section 13.2.2 of the Purchase Agreement,
the City shall not exercise its Repurchase Right unless (i) Lender fails, within 10 days after
receiving a written notice from the City of such intent, to commit to completing the Vertical
Construction, or (ii) Lender notifies the City of its intent not to complete such Vertical
Construction. Lender's address for notices is as follows:
Bank of America,N.A.
CA4-704-06-06
2000 Clayton Road, Bldg. D, 6th Floor
Concord, CA 94520
Attention: CREB Loan Administration
With a copy to:
Bank of America N.A.
800 Fifth Avenue, 34th Floor
Seattle, WA 98104
Attention: Laurie Johnson
Fax Number: (206) 358-6338
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4836-6793-7691
3. Grant of Security Interest; Right to Receive Reimbursements Directly; No Other
Assignments. Assignor hereby assigns to Assignee and grants to Assignee a security interest in
and to the Repurchase Proceeds. This Assignment is a present absolute assignment to secure
payment of the Repurchase Proceeds. In the event the City elects to or is required to pay the
Repurchase Proceeds to Assignor, the Repurchase Proceeds shall be paid directly to Lender
without any further instruction or consent of Assignor and, in connection therewith, Assignor
irrevocably directs the City to pay the Repurchase Proceeds directly to Lender. It shall not be
necessary for an Event of Default to have occurred under the Loan Agreement, the Note or any
other Loan Document for Lender to be entitled to receive the Repurchase Proceeds. Assignor
hereby grants Lender the right to be reimbursed directly by the City,pursuant to Section 5 below.
Assignor agrees not to further assign or otherwise encumber its interest in the Repurchase
Proceeds so long as this Assignment is in effect. This Assignment shall remain in effect until the
Obligations (as defined in the Deed of Trust) have been repaid and satisfied in full.
4. Representations. Each of the City and Assignor hereby represents and warrants to
Lender,with the understanding that Lender will rely thereon in making the Loan, that:
(a) Assignor has the exclusive and entire claim to the Repurchase Proceeds;
(b) Except for this Assignment, there has been no collateral or absolute
assignment of the Repurchase Proceeds;
(c) There exists no default or any event or condition which, with notice or the
passage of time or both, would constitute such a default or would result in a breach of the
Purchase Agreement or would give the City the right to exercise its Repurchase Right;
(d) Without limiting the representations set forth in Section 4(c) above, the
City and Assignor each represent that Vertical Construction commenced on or before the date
required under Section 15.3.1 of the Purchase Agreement(as amended); and
(e) Except as specified above, none of the provisions in the Purchase
Agreement relating to the Repurchase Rights have been modified or amended as of the date
hereof.
5. Authorizations. Assignor hereby authorizes the City to accept this Assignment
and authorizes and directs the City to make and render all acts and performances required of the
City under the terms of the Purchase Agreement relating to the Repurchase Right (specifically
including payment of the Repurchase Proceeds) directly to Lender or its nominee as Lender may
direct. Assignor hereby relieves the City from any liabilities to Assignor that Assignor might
otherwise have or assert by reason of the making or rendering of any performance by the City
under such provisions to Lender or its nominee. Any such amounts received by Lender under this
Section 5 shall be applied to the Obligations, provided, that any amounts remaining after
application thereof shall be paid directly by Lender to Assignor.
6. No Assumption. Lender shall not be deemed to assume any of Assignor's
obligations or duties under or in connection with the Purchase Agreement by virtue of this
Assignment, including, without limitation, after any exercise by Lender of its rights and remedies
hereunder such as the foreclosure of the security interests granted herein. Assignor shall
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4836-6793-7691
punctually perform or cause to be performed all covenants and obligations of Assignor under the
Purchase Agreement.
7. Modification of Purchase Agreement. Assignor and the City shall obtain the prior
written consent of Lender before entering into any agreement that amends, alters, or modifies the
City's Repurchase Right or Assignor's right to the Repurchase Proceeds. Lender shall not
unreasonably withhold or delay its consent to any such amendment or modification, so long as
Assignor and the City shall have consented to such amendment or modification and as long as
such amendment or modification does not materially and adversely affect Lender's security for
the Loan Agreement.
8. Power of Attorney. ASSIGNOR HEREBY IRREVOCABLY CONSTITUTES
AND APPOINTS LENDER AS ITS ATTORNEY-IN-FACT TO DEMAND, RECEIVE AND
ENFORCE ASSIGNOR'S RIGHTS WITH RESPECT TO THE REPURCHASE PROCEEDS,
TO GIVE APPROPRIATE RECEIPTS, RELEASES AND SATISFACTIONS FOR AND ON
BEHALF OF ASSIGNOR AND TO DO ANY AND ALL ACTS IN THE NAME OF
ASSIGNOR OR IN THE NAME OF LENDER, WITH THE SAME EFFECT AS IF DONE BY
ASSIGNOR HAD THIS ASSIGNMENT NOT BEEN MADE. The foregoing power of attorney
is coupled with an interest and is therefore irrevocable until the Obligations are repaid and
satisfied in full.
9. Further Assurances. Assignor agrees, at its expense and without expense to
Lender, to do, and cause the City to do, such further acts and to execute and deliver such
additional documents as Lender from time to time reasonably requires to assure and confirm all
the rights of Lender created hereby or intended now or hereafter to be, or to carry out the
intention of or facilitate the performance of the terms of this Assignment.
10. No Waiver; Cumulative Remedies. No delay or failure by Lender to exercise any
right or remedy against Assignor hereunder or any other Loan Document shall be construed as a
waiver thereof. The rights and remedies of Lender under this Assignment are cumulative and are
not in lieu of, but are in addition to, any other rights or remedies which Lender may have under
the Loan Agreement or the other Loan Documents at law, or otherwise.
11. Severability. If any provision of this Assignment shall be invalid, illegal or
unenforceable, it shall not affect or impair the validity, legality and enforceability of any other
provisions of this Assignment or of the other Loan Documents.
12. Amendment. This Assignment may not be amended, modified or changed, nor
shall any waiver of any provision hereof be effective, except by an instrument in writing and
signed by the party against whom enforcement of the waiver, amendment, change, modification
or discharge is sought.
13. Successors and Assigns. This Assignment shall be binding upon Lender and
Assignor and their respective successors and assigns, and shall inure to the benefit of Lender and
its respective successors and assigns.
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4836-6793-7691
14. Choice of Law. This Assignment shall be governed by and construed in
accordance with the laws of the State of Washington (without regard to its conflicts of law
principles).
15. Counterpart. This Assignment may be executed in any number of counterparts
and by different parties hereto on separate counterparts, each of which, when so executed and
delivered shall be an original, but also such counterparts shall together constitute one and the
same instrument.
WASHINGTON NOTICE:
ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, TO EXTEND
CREDIT, OR TO FORBEAR FROM ENFORCING PAYMENT OF A DEBT ARE NOT
ENFORCEABLE UNDER WASHINGTON LAW.
[Signature Pages Follow]
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4836-6793-7691
IN WITNESS WHEREOF, Assignor, Lender and the City have cause this Assignment to be
executed as of the date first hereinabove set forth.
ASSIGNOR:
MW HOLDINGS AUBURN SW BLOCK LLC, a
Washington limited liability company
By: R.D. Merrill Real Estate Holdings, LLC, its
Managing Member
By:
Name:
Title:
By:
Name:
Title:
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
This record has been acknowledged before me by and
, as the and
of R.D. Merrill Real Estate Holdings,
LLC,the managing member of MW Holdings Auburn SW Block LLC.
Dated: , 2019
Name Printed:
Notary Public in and for the State of
Washington, residing at
My appointment expires
[Signatures Continue on the Following Page]
Signature Page to Assignment of Right to Repurchase Proceeds Under Purchase Agreement
4836-6793-7691
CITY:
CITY OF AUBURN, a municipal corporation of the
State of Washington
By: X:
Name: ! r1 ObG Ills
Title: • Y C
STATE OF WASHINGTON )
ss.
COUNTY OF KING )
This record has been acknowledged before me by Nan ' C;Lc (t$ , as the
NMaybr of the City of Auburn, a municipa corporation of the State of
Washington.
Dated: 31.,a1Aj _, 2019
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_7: ��; %f "i Notary Public in and for the State of
_05 4.1!`?otn,p`A$ , �� Washington, residing at Z
E.:
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V My appointment expires l • LZ
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71.j9•'', . 0_ [Signatures Continue on the Following Page]
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Signature Page to Assignment of Right to Repurchase Proceeds Under Purchase Agreement
4836-6793-7691
LENDER:
BANK OF AMERICA, N.A., a national banking
association
By:
Name:
Title:
STATE OF WASHINGTON )
ss.
COUNTY OF KING )
This record has been acknowledged before me by , as the
of Bank of America,N.A., a national banking association.
Dated: , 2019
Name Printed:
Notary Public in and for the State of
Washington, residing at
My appointment expires
Signature Page to Assignment of Right to Repurchase Proceeds Under Purchase Agreement
4836-6793-7691
EXHIBIT A
LEGAL DESCRIPTION:
PARCEL I:
LOTS 1 AND 2, BLOCK 5, TOWN OF SLAUGHTER, ACCORDING TO THE PLAT
THEREOF RECORDED IN VOLUME 2 OF PLATS, PAGE 56, IN KING COUNTY,
WASHINGTON;
TOGETHER WITH THAT PORTION OF VACATED ALLEY ADJACENT AS PER CITY OF
AUBURN ORDINANCE NO. 5842, RECORDED JULY 8, 2004 AS RECORDING NO.
20070708002028;
EXCEPT THAT PORTION CONVEYED TO THE CITY OF AUBURN BY DEED
RECORDED UNDER RECORDING NO. 20190219001257.
PARCEL II:
LOTS A AND B OF LOT LINE ADJUSTMENT NO. LLA-05-0015, RECORDED JANUARY
17, 2006 AS RECORDING NO. 20060117002764, IN KING COUNTY, WASHINGTON;
EXCEPT THAT PORTION CONVEYED TO THE CITY OF AUBURN BY DEED
RECORDED UNDER RECORDING NO. 20190219001257.
PARCEL III:
THE SOUTH 60 FEET OF LOTS 7 AND 8, BLOCK 5, TOWN OF SLAUGHTER,
ACCORDING TO THE PLAT THEREOF RECORDED IN VOLUME 2 OF PLATS, PAGE 56,
IN KING COUNTY, WASHINGTON
EXCEPT THAT PORTION CONVEYED TO THE CITY OF AUBURN BY DEED
RECORDED UNDER RECORDING NO. 20190219001257.
4836-6793-7691
Gerri Blackwell
From: Jeff Tate
Sent: Wednesday,July 3, 2019 12:06 PM
To: Gerri Blackwell
Cc: Steve Gross
Subject: FW:Auburn Towncenter[KLG-USW_Active0l.FID697584]
Attachments: Assignment of Purchase Agreement Rights - BofA - Merrill - MW Holdings A....pdf
-li Gerri,
Zan you please coordinate signature of this document? Steve has already reviewed and determined to be acceptable. Once
>igned, I would like to deliver a hard copy to the customer so please interoffice the document to me.
(hank you for your help.
teff
From: Hefta, Rhys W.<Rhys.Hefta@klgates.com>
lent:Wednesday,July 3, 2019 10:58 AM
10:Jeff Tate<jtate@auburnwa.gov>
:c:Jennifer Valenta (jennifery@merrillgardens.com)<jennifery@merrillgardens.com>;John Walker<jwalker@teutsch.com>
subject: FW:Auburn Towncenter[KLG-USW_Active0l.FID697584]
CAUTION: The following message originated from outside the City of Auburn. Be careful opening links and
attachments
Jeff,
'm working with John Walker and Pillar Properties on this transaction. Thank you for your quick review of this document. The
ender has prepared an execution version of the agreement. If you can have this signed on behalf of the City and returned to me
)t the address below, I can coordinate getting the signatures of the other parties. One copy is sufficient for the lender. Please
ust let me know if you have any questions.
['hanks,
lhys
L GATES
Phys W. Hefta
<&L Gates LLP
)25 Fourth Avenue, Suite 2900
Seattle,Washington 98104-1158
phone: +1 206-370-7675
:ax: +1 206-623-7022
1
-hys.hefta@klgates.com
www.klgates.com
From: Jennifer Valenta [mailto:JenniferV@merrillgardens.com]
Sent:Tuesday, July 02, 2019 2:21 PM
1o: John Walker
:c: Hefta, Rhys W.; Jennifer Valenta
subject: RE: Auburn Towncenter
Jennifer A. Valenta
Merrill Gardens I Pillar Properties
lice President of Real Estate Legal Services
1938 Fairview Ave.E., Ste. 300
Seattle, WA 98102
206) 676-5623
206) 676-5353 Fax
:rom:John Walker<iwalker@teutsch.com>
lent:Tuesday,July 02, 2019 1:45 PM
10:Jennifer Valenta<JenniferV@merrillgardens.com>
subject: Fwd:Auburn Towncenter
[ohn Walker
Sent from my iPhone
3egin forwarded message:
From: Jeff Tate <jtate@auburnwa.gov>
Date: July 2, 2019 at 1:31:51 PM PDT
To: 'John Walker' <jwalker@teutsch.com>
Subject: RE: Auburn Towncenter
Hi John,
The document has been reviewed and we are comfortable signing it. How do you want to coordinate
signatures? Is there an order in which signatures should be obtained (e.g. who signs first, second, and third) or
can each party sign its own version that can then be combined. We don't have a preference.
Jeff
From:John Walker<iwalker@teutsch.com>
Sent: Friday,June 28, 2019 11:48 AM
To:Jeff Tate<itate@auburnwa.gov>
Subject:Auburn Towncenter
•
•
•
C A( TION: The following message originated from outside the City of Auburn. Be careful opening
links and attachments
AMMO 6
2
Hello Jeff,
We are in the final stages of closing our construction loan with BofA. They have asked that the City
sign the attached assignment and consent. For background, the Purchase and Sale Agreement Section
15.4 provides restrictions on Buyer assignments and encumbrances which require City
consent. Additionally, Section 13.2.2 provides purchase rights to the City if Buyer fails to comply with
Section 15.3 (vertical construction start and completion). Therefore, BofA is asking for City consent of
the financing of our project and collateral assignment of the borrower's right to receive the repurchase
proceeds, if the City exercises its repurchase rights. So the payment in that case would be made directly to the
lender and applied against the loan.
Would you please forward to City attorney or other applicable parties, and let me know if you have any
questions or concerns.
Thanks,
john walker
iwalker@teutsch.com
206.919.7009
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