HomeMy WebLinkAboutContract 35326-CA4CSC No. 35326-CA4
CONSENT TO ASSIGNMENT FOR SECURITY PURPOSES
OF ECONOMIC DEVELOPMENT PROGRAM AGREEMENT BETWEEN CITY OF FORT
WORTH, BGO-S2 TRINITY BLUFFS OWNER, LLC, AND BSP OF FINANCE, LLC
(CITY SECRETARY CONTRACT NO. 35326, AS AMENDED)
AND ESTOPPEL CERTIFICATE
This CONSENT TO ASSIGNMENT FOR SECURITY PURPOSES OF FORT WORTH
CITY SECRET ARY CONTRACT NUMBER 35326, as amended, ("Consent") is entered into by and
between the CITY OF FORT WORTH ("City"), a home-rule municipal corporation organized under the
laws of the State of Texas; BGO-S2 TRINITY BLUFFS OWNER, LLC ("Developer"), a Delaware
limited liability; and BSP OF FINANCE, LLC ("Lender"), a Delaware limited liability company.
RECITALS
The City, Developer, and Lender hereby agree that the following statements are true and correct
and constitute the basis upon which the parties have entered into this Consent:
A.The City is a party to (i) that certain Amended and Restated Economic Development
Program Agreement, dated on or about May 25, 2007, between the City and Developer, as successor-in
interest to SWF Trinity Bluffs, LLC ("SWF"), as successor-in-interest to LPC Trinity Parks LP ("LPC"),
a Texas limited partnership, as successor-in-interest to Trinity Bluff Development, Ltd. ("TBD"), on file in
the City Secretary's Office as City Secretary Contract No. 35326, (ii) that certain Amendment No. 1 to
Amended and Restated Economic Development Program Agreement between the City and Developer, as
successor-in-interest to SWF, as successor-in-interest to LPC, as successor-in-interest to TBD, on file in
the City Secretary's Office as City Secretary Contract No. 35326-Al, and (iii) that certain Amendm ent No.
2 to Amended and Restated Economic Development Program Agreement between the City and Developer,
as successor-in-interest to SWF, as successor-in-interest to LPC, and as successor-in-interest to TBD, on
file in the City Secretary's Office as City Secretary Contract No. 35326-A2 (items (i), (ii) and (iii) are
collectively the "EDP A").
B.Developer wishes to obtain a loan from Lender encumbering the property subject to the
EDPA in connection with Developer's purchase of the subject property from SWF ("Loan"). As security
for the Loan, certain agreements between Developer and Lender governing the Loan, including, but not
limited to, that certain (i) Deed of Trust and Security Agreement dated on or about June 9. 2021 (the
"Closing Date"), executed by Developer, as grantor, for the benefit of Lender, as beneficiary, to be recorded
in the Real Property Records of Tarrant County, Texas, (ii) Promissory Note dated as of the Closing Date,
in the maximum principal amount of$60,173,000.00 executed by Developer, to the order of Lender, and
(iii)certain other related documents entered into by the parties in connection with the Loan (collectively,
the "Loan Documents") require that Developer assign, transfer, and convey to Lender all of Developer's
rights, interest in and to the EDP A until such time as Developer has fully satisfied all duties and obligations
set forth in the Loan Documents that are necessary to discharge Lender's security interest in the EDP A (the
"Assignment").
C.Lender intends to assign its security interest in the Agreement, as governed by this Consent,
to its affiliates ("Lender's Affiliates"), with the intent to secure the Loan (collectively, the "Subsequent
Intended Assignments"). A Lender's Affiliate means any entity under common control with, controlled
by, or controlling Lender. "Control" means fifty percent (50%) or more of the ownership as determined by
either value or vote. Consent to Assignment for Security Purposes (CSC No. 35326) Between City of Fort Worth, BGO-S2 Trinity Bluffs Owner, LLC and BSP OF Finance, LLC Pagel of7
D. Pursuant to Section 10 of the EDPA, the City is willing to grant consent to this conditional
Assignment and to the Subsequent Intended Assignments specifically in accordance with the terms and
condirions of this Consent.
E. On June 8, 2021, the City Council adopted Mayor and Council Communication 21-0385,
authorizing a consent to assignment by Developer to BSPRT CRE Finance, LLC or an Affiliate. Lender
has represented that it is an affiliate of BSPRT CRE Finance, LLC and, therefore, a proper party to this
Consent.
AGREEMENT
1. The City, Developer, and Lender hereby agree that the recitals set forth above are true and
correct and form the basis upon which the City has entered into this Consent and are incorporated here for
all purposes.
2. The City hereby consents to the Assignment at the request of Developer and Lender solely
for the purpose of Lender's securing the Loan pursuant to and in accordance with the Loan Documents.
Notwithstanding such consent, the City does not adopt, ratify, or approve any of the particular provisions
of the Loan Documents and, unless and to the extent specifically acknowledged by the City in this Consent,
does not grant any right or privilege to Lender or any assignee or successor-in-interest thereto that is
different from or more extensive than any right or privilege granted to Developer under the EDPA.
3. The Lender may enter into Subsequent Intended Assignments in connection with the Loan;
provided, however, that the Lender and Intended Subsequent Assignees (as hereinafter defined) understand
and acknowledge that, except as specifically set forth in Sections 5 and 6 below, the City will not have any
direct contractual obligations to the Lender's Affiliates or their successors and assigns (collectively, the
"Intended Subsequent Assignees"), either under this Consent or the Agreement, unless the City and the
applicable Intended Subsequent Assignee seeking to enforce such obligation enter into a written agreement
on substantially similar terms as those set forth in this Consent, with the understanding that any such
agreement will be subj ect to City Council approval. Notwithstanding anything to the contrary, Lender must
provide the City with written norice of any such Subsequent Intended Assignments, to include the identity
and contact information for the same, within thirty (30) calendar days a8er such assignment. Such a
Subsequent Intended Assignment will not be construed as a breach of the EDPA.
4. The EDPA may be amended to allow the Lender to assign any of its rights or obligations
under the EDPA to an Intended Subsequent Assignee for purposes of granting a security interest without
further approvals from the City, including City Council. If such event occurs, then the Lender and any
Intended Subsequent Assignee, as applicable, must provide the City with written notice of any such
Subsequent Intended Assignments, to include the identity and contact information for the same, within
thirty (30) calendar days after such assignment. Any such Intended Subsequent Assignees will still be
subj ect to the terms of this Consent and the EDPA. Notwithstanding anything to the contrary, if the EDPA
is amended to add the provision set forth in this Section 4, then Section 3 will be null and void and any
assignments made pursuant to Section 3 will be ratified and subject to this Section 4.
5. In the event that the City is required by the EDPA to provide any kind of written notice to
Developer, including notice of breach or default by Developer, the City will also simultaneously provide a
Consent to Assignment for Security Purposes (CSC No. 35326)
Between City of Fort Worth, BGO-S2 Trinity Bluffs Owner, LLC and BSP OF Finance, LLC Page 2 of 7
copy of such written notice to Lender, addressed to the following, or such other party or address as Lender
designates in writing, by reputable overnight courier for next day delivery, certified mail, postage prepaid,
or by hand delivery:
BSP OF FINANCE, LLC
1345 Avenue of the Americas, Suite 32A
New York, New York 10105
Attention: Micah Goodman, General Counsel
With a copy to:
Katten Muchin Rosenman LLP
550 South Tryon Street, Suite 2900
Charlotte, North Carolina 28202
Attention: John Domby, Esq.
or such other address(es) as Lender (or its successor or assigns) may advise City from time to time.
6. If Developer fails to cure any default under the EDPA, the City agrees that Lender or
Intended Subsequent Assignees will have an additional ninety (90) calendar days beyond the cure period
given to Developer under the EDPA or such greater time as may specifically be provided under the EDPA
to perform any of the obligations or requirements of Developer imposed by the EDPA and that the City will
accept Lender's or the Intended Subsequent Assignees' performance of the same as if Developer had
performed such obligations or requirements; provided, however, that in the event such default cannot be
cured within such time, Lender or Intended Subsequent Assignees, will have such additional time as may
be reasonably necessary, if within such time period, Lender or Intended Subsequent Assignees has
commenced and is diligently pursuing the remedies to cure such default, including, without limitation, such
time as may be required for Lender or Intended Subsequent Assignees to gain possession of the
Development Property and the Required Improvements pursuant to the terms of the Loan Documents.
7. If, at any time, Lender wishes to exercise any foreclosure rights under the Loan Documents,
before taking any foreclosure action, Lender must first provide written notice to the City of such intent
("Notice"). Lender must copy Developer on the Notice and deliver such Notice to Developer by both first
class and certified mail return receipt concurrent with its transmittal of the Notice to the City and represent
in the Notice that it has done so. Notwithstanding anything to the contrary herein, unless Lender enters into
a written agreement with the City to assume and be bound by all covenants and obligations of "Developer"
under the EDPA, Lender understands and agrees that the City will not be bound to pay Lender any Program
Grants pursuant to the EDPA. In addition, Lender understands and agrees that, if Lender wishes to sell all
or any portion of the Development Property or the Required Improvements to a third party following
Lender's exercise of any foreclosure rights under the Loan Documents, the City will not be bound to pay
such third party any Program Grants pursuant to the EDPA unless Lender and such third party comply with
the procedure for assignment set forth in Section 10 of the EDPA, including the obligation of such third
party to enter into a written agreement with the City to assume and be bound by all covenants and
obligations of"Developer" under the EDPA. In the event that payment of any Program Grants are withheld
by the City pursuant to this Section 7, any rights to receipt of those Program Grants are hereby waived, but
the number and amount(s) of any such Program Grant(s) will nevertheless be counted for purposes of
calculating the Term of the EDPA, as set forth in Section 3 of the EDPA. The term "Intended Subsequent
Consent W Assignment for Security Purposes (CSC No. 35326)
Between City of Fort Worth, BGO-S2 Trinity Bluffs Owner, LLC and BSP OF Finance, LLC Page 3 of 7
Assignees" will be substituted for "Lender" in this Section 7 upon the occurrence of the applicable
conditions set forth in Sections 3 or 4, as the case may be.
8. It is understood between the City, Developer, and Lender that Developer or an affiliate of
Developer will be entering into a mezzanine loan, which will entitle the mezzanine lender thereunder to
acquire a certain interest in ownership of Developer in the event of a default under the terms of such
mezzanine loan. In such event, any change in the ownership status of the Developer will not be deemed a
default under the EDPA so long such a transfer does not violate Section 10 of the EDPA.
9. In the event of any conflict between this Consent and the EDPA, this Consent controls. In
the event of any conflict between this Consent and any of the Loan Documents, this Consent controls as to
the City. In the event of any conflict between the EDPA and any of the Loan Documents, the EDPA controls
as to the City.
10. This Consent may not be amended or modified except by a written agreement executed by
all of the parties hereto. Notwithstanding anything to the contrary in the Loan Documents, an amendment
to any of the Loan Documents does not constitute an amendment to this Consent or the EDPA.
11. Once Developer has fully satisfied all duties and obligations set forth in the Loan
Documents that are necessary to discharge Lender's security interest in the EDPA and such security interest
is released, Lender must provide written notice to the City that Lender has released such security interest,
in which case this Consent will automatically terminate.
12. This Consent will be construed in accordance with the laws of the State of Texas. Venue
for any action arising under the provisions of this Consent will lie in state courts located in Tarrant County,
Texas or in the United States District Court for the Northern District of Texas, Fort Worth Division.
13. Capitalized terms used but not specifically defined in this Consent have the meanings
ascribed to them in the EDPA.
14. This written instrument contains the entire understanding and agreement between the City,
Developer, and Lender as to the matters contained herein. Any prior or contemporaneous oral or written
agreement concerning such matters is hereby declared null and void to the extent in conflict with this
Consent.
15. This Consent may be executed in any number of duplicate originals and each duplicate
original shall be deemed to be an original. The failure of any party hereto to execute this Consent, or any
counterpart hereof, does not relieve the other si�atories from their obligations hereunder.
16. This Consent may be executed by electronic signature, which will be considered as an
original signature for all purposes and have the same force and effect as an original signature. For these
purposes, "electronic signature" means electronically scanned and transmitted versions (e.g. via pdf file or
facsimile transmission) of an original signature, or signatures electronically inserted via software such as
Adobe Sign.
17. As of the date of execution of this Consent by the City, to the knowledge of the City, there
exists no factual circumstance or condition which, with notice or the lapse of time, or both, would give rise
to any obligation of any party to the Agreement which, if not satisfied, will constitute an event of default
Consent to Assignment for Securiry Purposes (CSC No. 35326)
Between City of Fort Worth, BGO-S2 Trinity Bluffs Owner, LLC and BSP OF Finance, LLC Page 4 of 7
on the part of either the City or Assignor.
IN WITNESS WHEREOF, the undersigned have caused this Consent to be executed in multiples
to be effective as of June 9, 2021.
CITY OF FORT WORTH:
By : Jesus J. Chapa (Jun9,02115:02 CDT)
Jay Chapa
Deputy City Manager
Date: Jun 9, 2021
APPROVED AS TO FORM AND LEGALITY:
7r4wa&d By: _________ _Tyler F. Wallach
Assistant City Attorney
ATTEST:
By:�9-�
Mary Kayser
City Secretary
Contract Compliance Manager:
By signing, I acknowledge that I am the person
responsible for monitoring and administration of this contract,
including all performance and reporting requirements.
�� Elise Back (Jun 9, 202114:48 CDT)
Elise Back, Manager
Economic Development
M&C: 21-0385
Form 1295: 2021-763131
[SIGNATURES CONTINUE ON THE NEXT TWO PAGES]
Consent to Assignment for Security Purposes (CSC No. 35326) Between City of Fort Worth, BGO-S2 Trinity Bluffs Owner, LLC and BSP OF Finance, LLC Page 5 of7
DEVELOPER:
BGO-S2 TRINITY BLUFFS OWNER, LLC a Delaware limited liability company
By: _�_�_-_W_·.
Name: Scott Everett Title: Manager
Date: __ J_u_n_e _8_, 2_0_2_1 ___ _ Consent to Assignment for Security Purposes (CSC No. 35326) Between City of Fort Worth, BGO-S2 Trinity Bluffs Owner, LLC and BSP OF Finance, LLC Page 6 of7
LENDER:
BSP OF FINANCE, LLC, a Delaware
Limited liability company
By:
Name: Micah Go an
Title: Authorized Person
Date: June 8, 2021
Consent to Assignment for Security Purposes (CSC No. 35326)
Between City of Fort Worth, BGO-S2 Trinity Bluffs Owner, LLC and BSP OF Finance, LLC
OFFICIAL REC�RD
CITY SECRETARY
FT. VIIORTH, TX
ACITY COUNCIL AGEND
DATE: 6/8/2021 REFERENCE **M&C 21- LOG NAME: 17TRINITYBLUFFPHIICONSENT3
NO.: 0385
CODE: C TYPE: CONSENT PUBLIC NO
HEARING:
SUBJECT: (CD 9) Ratify the Execution of Consents to Assignment for Security Purposes of City
Secretary Contract Nos. 35326 and 35327, Economic Development Program
Agreements, by BGO-S2 Trinity Bluffs Owner LLC, or an Affiliate, to BSPRT CRE
Finance, LLC or an Affiliate
RECOMMENDATION:
It is recommended that the City Council ratify the execution of consents to assignment for security purposes
of City Secretary Contract Nos. 35326 and 35327, Economic Development Program Agreements, by BGO-
S2 Trinity Bluffs Owner LLC, or an affiliate, to a BSPRT CRE Finance, LLC or an affiliate.
DISCUSSION:
On July 25, 2006, the City authorized the execution of Economic Development Program Agreements
(EDPAs) with Trinity Bluff Development, Ltd. for downtown residential projects (City Secretary Contract Nos.
34173 and 34174, Mayor and Council Communication (M&C) C-21586). Under the proposed EDPAs , Trinity
Bluff Development, Ltd., working with Lincoln Property Southwest, Inc. (collectively, Developer), committed
to construct two apartment complexes, with approximately 490 units for lease with 5\°/o of the apartments set
aside for lease at affordable rates to qualifying households earning no more than 80\% of the area median
income, per HUD standards, (collectively, Development).
On May 15, 2007, the City authorized the execution of Amended and Restated EDPAs with Trinity Bluff
Development, Ltd. to allow for changes in the project's scope and provide for changes in the amount of
grants payable by the City to the Developer under the agreements (City Secretary Contract No. 35326 and
35327, M&C C-22121). The authorized amendments replaced the originally approved agreements. On May
30, 2007, Trinity Bluff Development, Ltd., assigned all of its rights and obligations under the agreements to
LPC Trinity Parks LP, which is an affiliate of Lincoln Property Company Southwest, Inc. On October 6, 2009,
the City authorized amendments to the EDPAs (City Secretary Contract Nos. 35236-A1 and 35237-A1, M&C
23823), to modify the deadlines for the completion of the private improvements that are required under those
Agreements in order to receive certain economic development grants from the City.
On March 15, 2014, the City authorized Consents to Assignment with LPC Trinity Parks LP assigning all of
its rights and obligations under the agreements to SWF Trinity Bluff, LLC or one of its affiliates and Consents
to Collateral Assignment with Metropolitan Life Insurance (City Secretary Contract Nos. 35326-CA-1, 35326-
CA-2, 35327-CA-1, and 35327-CA-2, M&C C-26763). In March 2021, SWF Trinity Bluff, LLC approached
the City about its desire to assign the agreements to S2 Trinity Bluff, LLC or an affiliate. The Developer has
constructed all the required improvements, but has not completed all of the additional investment necessary
to obtain the full amounts of the Program Grants under the agreements. The purchaser will be required to
meet all ongoing obligations of the Developer under the agreement. The City will continue to receive the
public benefits resulting from development of this project and any additional assignments of the agreement
would have to be approved by City Council.
On May 4, 2021, the City Council authorized M&C 21-0310, authorizing a consent to assignment by SWF to
S2 Trinity Bluff, LLC. Subsequently, S2 Trinity Bluff changed its name BGO-S2 Trinity Bluffs Owner, LLC. As
a result of the pending sale, the mortgage lender has requested Consents to Assignments for Security
Purposes of the EDPAs. The lender required these documents to be executed in late May and, therefore,
this M&C is seeking the ratification of those Consents to Assignment.
The Trinity Bluff development is located in COUNCIL DISTRICT 9.
FISCAL INFORMATION/CERTIFICATION:
The Director of Finance certifies that approval of this recommendation will have no material effect on City
funds.
FORT �'�'URTH
_�_
TO
T Fund Department Account Project Program Activity Budget
_ ID ID Year
Fund Department
rn
�
Submitted for City Manager's Office by_
Originating Department Head:
Additional Information Contact:
Account � Project � Program � Activity Budget
rogram
Year
Jay Chapa (5804)
Robert Sturns (2663)
Robert Sturns (2663)
Reference # Amount
(Chartfield 2)
Reference # Amount
Chartfield 2
Reference # Amount
(Chartfield 2)
ATTACHMENTS