HomeMy WebLinkAboutRobert L. Mayer Corp. - Xyclon Services Co. - 1989-06-26 RE 'EST FOR CITY CO1 " ICILY
REDEVELOPMENT AGENCY XbTION
RH 89-40
Date .Tune 19, 1989
Submitted to: Honorable Mayor/Chairman and City Council/Redevelopment Agency Members
Submitted by: Paul Cook, City Administrator/Executive Director -G
Prepared by: Douglas La Belle, Deputy City Administrator/Economic Development
Subji!ct: TERMINATION OF LEASEHOLD INTEREST FOR NELSON AUTO SERVICE
Consistent with Council Policy? I l Yes [ New Policy or Exception
APPROVED BY CITY COU:JCIL
Statement of Issue, Recommrxtdation,Analysis, Funding Source,Alt rnative Actions,Attachments:
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STATEMENT OF1SSDUE: CITY CLERK
The Robert L. Mayer Corporation is requesting reimbursement from tqe Redevelopment
Agency for costs incurred to acquire and terminate the leasehold interest between Nelson
Auto Service and the city of Huntington Beach.•
REC MMENDATION:
Authorize City/Agency Clerk and Mayor/Chairman to execute the attached Agreement
and authorize credit of $227,499.39 to the Mayer Corporation against the amount loaned
by RLM to the Agency for relocation of Phase I of the Driftwood Mobilehome Park.
ANALYSIS:
In November of 1988, Xyclon Services Company (owned by The Robert L. Mayer
Corporation), acquired the leasehold interest of Nelson Trucking Company. Xyclon
(Mayer Corp.) acquired the interest in order to facilitate the conclusion of the
negotiations between the Driftwood Homeowners Association, the Agency, and RLM,
regarding the Driftwood Relocation Agreement. The Driftwood Homeowners Association
firmly maintained during negotiations that removal of Nelson Trucking, located on the
corner of Ellis Avenue and Golden West Street, was necessary to the development of
Phase I of Ocean View Estates Mobilehome Park (a potential relocation site for Driftwood
residents). Finalizing and subsequent approval of the Relocation Agreement was a key
component to the implementation of the Waterfront project.
The Costs for acquisition of the Nelson leasehold were later sited in the Driftwood
Relocation Agreement as an expenditure that would be a part of the $3.2 million advanced
by The Mayer Corporation for resident relocation. Pursuant to the Disposition and
Development Agreement, the amount loaned by RLM to the Agency for relocation costs is
reimbursable from future project revenues.
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EUNDING SOURCE:
The cost of acquiring the Nelson leasehold interest will be repaid to RLM through a
portion of the property tax increment and transient occupancy tax generated by later
phases of the Waterfront project.
ALIERNA11VE
Do not authorize credit to The Mayer Corporation for acquisition costs of the Nelson
leasehold interest.
ATTACHMENTS:
None
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4707h
ACTION BY UNANIMOUS WRITTEN CONSENT
OF THE BOARD OF DIRECTORS
OF
XYCLON SERVICES CO.
a California corporation
The undersigned, constituting the sole director of
Xyclon Service Co. , a California corporation, acting pursuant
to the authority of Section 307 (b) of the California General
Corporation Law, hereby adopts the following resolutions :
ASSIGNMENT, ASSUMPTION, AND TERMINATION OF LEASE
RESOLVED, that the Assignment and Assumption of
Lease dated November 9, 1988, by and between Thomas E.
Nelson and Dixie Nelson, husband and wife, and Thomas E.
Nelson dba Nelson' s Auto Service, and Xyclon Services
Co. is hereby ratified and approved and Robert L. Mayer ,
as President and Secretary, is hereby authorized to
execute said Assignment on behalf of Xyclon Services Co.
and perform all acts to be performed by Xyclon Services
Co. thereunder .
RESOLVED FURTHER, that the Agreement Re Termination
of Lease and Acknowledgment Re Reimbursement Obligations
Under Disposition and Development Agreement entered into
on or about ._1ZjN�� I , 198-, by and among the
City of Huntington Beach, the Redevelopment Agency of
the City of Huntington Beach, Robert L. Mayer, as
Trustee of the Robert L. Mayer Trust of 1982, dated
June 22, 1982, as amended, and Xyclon Services Co. is
hereby ratified and approved and Robert L. Mayer is
authorized to execute such Agreement on behalf of Xyclon
Services Co. and perform all acts required to be
performed by Xyclon Services Co. thereunder .
Dated: 1989
Robert L. Mayer
AGREEMENT RE TERMINATION OF LEASE
AND ACKNOWLEDGMENT RE REIMBURSEMENT
QBLIGATION _UNDER DISPOSITION AND
DEVELOPMENT AGREEMENT
(Waterfront Project)
THIS AGREEMENT is entered into by and between the CITY
OF HLINTINGTON BEACH, a municipal corporation ( "City") , the
'REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a
public agency ( "Agency") , ROBERT L. MAYER, as Trustee of the
Robert L. Mayer Trust of 1982, dated June 22, 1982, as
amended ("Mayer") , and XYCLON SERVICES CO. , a California
corporation ("Xyclon" ) .
A. On or about August 15, 1988, Agency and Mayer
entered into a Disposition and Development Agreement ("DDA" )
for the redevelopment of approximately forty-five (45) acres
of real property located on the inland side of Pacific Coast
Highway between Huntington Street and Beach Boulevard in
Agency's Main-Pier Redevelopment Project Area (the
"Waterfront Site") .
B. On or about August 15, 1988, Agency, Mayer, the
Driftwood Beach Club Mobile Homeowner's Association, Inc. ,
and individual tenants of the Driftwood Beach Club Mobile
Home Park on the Waterfront Site entered into a Mobilehome
Acquisition and Relocation Agreement (the "Mobilehome
Relocation Agreement") which provides for the relocation .of
certain of the mobilehome tenants from the Waterfront Site to
a mobilehome park being developed by City and Agency at the
northeast corner of Ellis Avenue and Goldenwest Street
( "Oceanview Estates I" ) in time to allow redevelopment of the
Waterfront Site to proceed in accordance with the DDA.
C. Pursuant to the DDA and the Mobilehome Relocation
Agreement, Agency agreed to exercise its best efforts to
acquire the necessary possessory rights to Oceanview
Estates I to enable it to develop the replacement mobilehome
park thereon.
D. Pursuant to the DDA, Mayer agreed to loan or
advance to Agency up to Four Million Eight Hundred Thousand
Dollars ($4,800,000.00) , less certain adjustments, with a
maximum of Three Million Six Hundred Fifty Thousand Dollars
($3,550,000.00) of said amount to be loaned or advanced in
Phase 1, to assist Agency in performing its obligations to
relocate tenants from the Driftwood Mobilehome Park on the
Waterfront Site to Oceanview Estates I.
05/19/89
E. As of the date that the DDA and Mobilehome
Relocation Agreement were entered into, City was the owner of
a - portion of Oceanview Estates I (the "Premises" ) that was
subject to a long-term lease dated February 23, 1968 (the
"Lease") , entered into by and between City's predecessor-in-
interest, as lessor, and Thomas E. Nelson and Dixie Nelson,
husband and wife, and Thomas E. Nelson dba Nelson's Auto
Service (collectively, "Nelson") , as lessee. The Lease .
expires on or about April 1, 1993.
F. Mayer formed Xyclon as an affiliated company to
assist Agency in acquiring Nelson's leasehold interest in the
Premises under the Lease.
G. On . or about November 9, 1988, Xyclon, acting on
behalf of Agency, entered into an agreement with Nelson
entitled "Assignment and Assumption of Lease" and acquired
all of Nelson's right, title, and interest in and to the
Lease and the Premises.
H. Xyclon has requested that City consent to the
assignment of the Lease by Nelson to Xyclon.
I. City, Agency, Mayer, and Xyclon desire to enter
into this Agreement to memorialize City's consent to the
assignment of the Lease from Nelson to Xyclon, to terminate
the Lease, and to acknowledge Mayer 's entitlement to
reimbursement for expenses incurred by Xyclon in acquiring
the Lease, all pursuant to the applicable provisions of the
DDA and the Mobilehome Relocation Agreement.
Based upon the foregoing Recitals and for the considera-
tion set forth in the DDA, the Mobilehome Relocation
Agreement, and herein, City, Agency, Mayer, and Xyclon agree
as follows:
1. City hereby consents to the assignment of the Lease
from Nelson to Xyclon and does fully affirm and declare said
assignment to be valid and of full force and effect.
2. Xyclon hereby surrenders the Lease and all of its
right, title, and interest in and to the Premises to City and
City hereby accepts such surrender from Xyclon. The Lease
shall be deemed to have terminated effective November 10,
1988 (the "Effective Date" ) .
3. City, on the one hand, and Xyclon and Mayer, on the
other hand, and their respective officers, directors,
employees, agents, and Shareholders, hereby specifically
release and forever discharge the other from their respective
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obligations arising from the Lease and all rights, claims,
demands, causes of action, damages, suits; controversies,
debts, breaches of agreements, breaches of contract, breaches
of covenants, representations and/or warranties, costs and
expenses of any nature whatsoever, whether known or unknown,
arising out of or in connection with the Lease, excluding
only those obligations arising from this Agreement. By
releasing and forever discharging claims, both now known or
unknown, as provided herein, the undersigned acknowledge that
they are familiar with and understand California Civil Code
Section 1542 which provides in pertinent part as follows:
"A general release does not extend to claims
which the creditor does not know or suspect to
exist in his favor at the time of executing
the release, which if known by him must have
materially affected his settlement with the
debtor."
4. Xyclon and Mayer agree to indemnify, defend, and
hold harmless City and Agency from and against any and all
claims, demands, causes of action, damages, liabilities,
costs, and expenses of Nelson and any person or entity
claiming under or through Nelson arising out of Xyclon's
acquisition of Nelson's leasehold interest in the Premises
pursuant to the Lease, including without limitation claims
for relocation expenses and assistance, loss of business
goodwill, compensation for the value of land, improvements,
improvements pertaining to the realty, and personal property,
attorney's fees, and costs.
5. City and Agency agree to indemnify, defend, and
hold harmless Xyclon, Mayer, and Xyclon's and Mayer's
respective officers, directors, employees, agents, and
shareholders from and against any and all claims, demands,
causes of action, damages, liabilities, costs, and expenses
of any nature whatsoever arising from any contamination,
hazardous waste, or toxic substance in existence on or below
the surface of the Premises subject to the Lease, including
without limitation any contamination of the soil, subsoil, or
groundwater which constitutes a violation of any law, rule,
or regulation of any governmental entity having jurisdiction
thereof, or which exposes Xyclon or Mayer or their respective
officers, directors, employees, agents, or shareholders to
liability to third parties, including without limitation any
investigatory costs, clean-up fees, legal fees, consultant's
fees, or other expenses which they may incur.
5. . City represents to Xyclon and Xyclon represents to
City that they have not made any assignment, sublease,
transfer, conveyance, or other disposition of the Lease or
their respective interests in the Lease or any claim, demand,
obligation, liability, action, or cause of action arising
from the Lease.
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7. City agrees to accept the Premises in an "As Is"
physical condition as of the Effective Date.
B. Agency hereby acknowledges that Mayer and its
affiliated company Xyclon have reasonably and properly
expended the sum of Two Hundred Twenty-Seven Thousand Four
Hundred Ninety-Nine . Dollars and Thirty-Eight Cents
($227,499.38) to assist Agency in acquiring and terminating
Nelson's interest in the Lease. Expenses incurred for this
purpose include payments made by Xyclon to Nelson, closing
costs, attorney's fees, and rental payments made by Xyclon to
City under the Lease for the period from October 1988 through
January 1989. Such expenses shall be included as a part of
the loan by Mayer to Agency pursuant to Paragraph II.I of
Attachment No. 3 (the "Scope of Development") to the DDA, to
be reimbursed by Agency at the times, in the manner, from the
sources of funds, and subject to the terms and conditions set
forth in Paragraph 5 of Attachment No. 5 (the "Method of
Financing") to the DDA. Except as specifically set forth in
the preceding sentence, Mayer and Xyclon agree that City and
Agency shall have no liability to Xyclon or Mayer for
compensation for the taking of land, . improvements,
improvements pertaining to the realty, relocation expense and
assistance, loss of business goodwill, attorney's fees,
costs, or expenses arising out of Xyclon's acquisition of the
Lease and the termination of the Lease as provided herein.
9 . Except as hereinabove specifically ratified, the
parties hereto acknowledge that this Agreement shall in no
way be construed as authority for any other actions,
expenditures, or claims by any party not expressly authorized
by the above-mentioned DDA or Mobilehome Relocation
Agreement.
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10. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective heirs,
successors, and assigns.
CITY OF HUNTINGTON BEACH,
a municipal corporation
Dated:
Mayor
ATTEST:
City Clerk
APPROVED AS TO FORM:
A.
City. Attorne t
REDEVELOPMENT AGENCY OF THE .
CITY OF HUNTINGTON BEACH,
a publi agency
Dated:_ z %���L By
Chairman
ATTEST:
Clerk
REVIEWED AND APPROVED AS TO FORM:
City Attorn /Agency Attorney
40 1-(�—
_5i
ROBERT L. MAYER, as Trustee of
the Robert L. Mayer Trust of
1982, dated June 22, 1982,
as amended
Dated;���w� f �� By c
Robert L. Mayer
XYCLON SERVICES CO. , a
California corporation
Dated: By e
Robert L. Mayer
President and Secretary
7/112/065580-0001/088
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