Report to Successor Agency
Tuesday, July 16, 2019
Consent
SUBJECT:
Title
CONSIDER APPROVAL OF THE SUBORDINATION AGREEMENT BY AND BETWEEN THE CARSON SUCCESSOR AGENCY, WIN CHEVROLET PROPERTIES, LLC, AND WIN CHEVROLET, INC. SUBORDINATING THE AGENCY NOTE TO BANK OF AMERICA, N.A. IN CONNECTION WITH THE WIN CHEVROLET DEALERSHIP PROPERTY LOCATED AT 2201 E. 223RD STREET (SUCCESSOR AGENCY)
Body
I. SUMMARY
On May 21, 2019, the Successor Agency Board approved this item and directed staff to take the matter to the County Oversight Board for consideration. Subsequent to the approval, staff and the City Attorney's Office determined that Oversight Board approval was not required. Staff is requesting the Successor Agency Board to re-approve the WIN Subordination Agreement without directing staff to take the matter to Oversight Board for consideration. The remainder of the staff report is identical to the May 21, 2019 staff report with the exception of the recommendation section.
May 21, 2019 Staff Report with Updated Recommendations.
WIN Chevrolet, Properties, LLC ("WIN") is preparing to refinance its holdings at 2201 E. 223rd Street ("Property") with Bank of America, N.A. ("Senior Lender"). The Carson Successor Agency ("Agency") currently holds a 20-year note ("Note") in the original amount of $7 million, which was secured by a deed of trust against the Property ("Agency Trust Deed"). The current principal balance of the Agency Note is $4,550,000, having been forgiven over the years in accordance to the Note at the rate of $350,000 per year provided WIN complied with certain obligations, including the continued operation of the existing WIN Chevrolet and Hyundai auto dealerships. The Agency Note was executed in 2011 pursuant to the Disposition and Development Agreement between the Carson Redevelopment Agency ("RDA") and WIN and Win Chevrolet, Inc. ("WIN Inc.") representing a portion of the purchase price for the Property ("DDA"). The RDA received an ALTA loan title pol...
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