HomeMy Public PortalAbout10) 7F Approval of a Payoff and Release Agreement between Calabees Inc and the City of Temple CityMANAGEMENT SERVICES DEPARTMENT
DATE: December 2. 2014
TO: The Honorable City Council
FROM: Bryan Cook, City Manager
Eric S. Vail, City Attorney
MEMORANDUM
AGENDA
ITEM 75
SUBJECT: APPROVAL OF A PAYOFF AND RELEASE AGREEMENT
(AGREEMENT) BETWEEN CALABEE'S, INC. AND THE CITY OF
TEMPLE CITY
RECOMMENDATION:
It is recommended the City Council approve an Agreement (Attachment "A") by and
between Calabee's Inc., (Calabee's) and the City of Temple City (City).
BACKGROUND:
On July 1, 2003, the City Council approved a Loan and Security Agreement by
and between the City and Calabee's. The minutes of this action is included in this
report as Attachment "B". The Loan and Security Agreement is also included in
the report as Attachment "C".
2. On July 31, 2013, the City corresponded with Calabee's (Attachment "D") and the
guarantor, Mr. John R. Biafone, (Attachment "E"), informing them that the City had
not received the regularly monthly payment of principle and interest as required by
the Loan and Security Agreement in April 2013, May 2013, June 2013 or July
2013.
3. On August 2, 2013, the City received the regularly monthly payment of principle
and interest as required by the Loan and Security Agreement for April 2013.
4. On November 20, 2013, the City corresponded with Calabee's (Attachment "F"),
offering them a new restructured loan as part of a Business Retention and
Operating Agreement, not yet drafted at that time. The deal points of the
Business Retention and Operating Agreement are outlined in the correspondence.
City Council
December 2, 2014
Page 2 of 3
5. Over the course of the last six months, staff has met periodically with Mr. Biafone
and has come to terms for a payoff and release as outlined in the Agreement.
6. On November 4, 2014, the City Council gave direction to staff to bring forward a
payoff and release agreement for approval in open session.
ANALYSIS:
In 2003, the City was interested in improving the business environment throughout the
City, potentially increasing revenues for the City and retail opportunities for the
residents and surrounding communities, which included a family style restaurant within
the City's corporate limits. Calabee's operated several family style restaurants under
the Applebee's and Millie's trade names in the greater San Gabriel Valley. To
overcome certain economic barriers, the City Council determined that it was in the
City's best interest and its residents to offer incentives to businesses. Their direction to
the City Manager was to negotiate a financing package with Calabee's to facilitate the
construction and operation of an Applebee's Restaurant (Restaurant) located on the
northwest corner of the intersection of Rosemead Boulevard and Las Tunas Drive.
The City agreed to finance the construction of the new Restaurant and tenant
improvements, which included a grant amount of $135,000 and a loan amount up to
$1,105,000.00. Calabee's ultimately borrowed $1,065,000.00. The term of the loan
was for 12 years or 144 months, at an interest rate of 4.5%.
Since 2005, the City has received $711,710.58 in principle payments and $295,954.42
in interest payments. However, Calabee's has been in default of the loan since May
2013, with a remaining principle balance of $353,289.42. The City recognized the
financial difficulty and proposed discussions for alternatives to resolving the default.
Unfortunately those discussions did not result in a restructuring of the current
outstanding debt or a revised loan agreement. However, an Agreement has been
reached between Mr. Bifone, Chief Operating Officer of Calabee's, and the City;
Calabee's has agreed to pay the City $200,000.00 within 120 days from the date the
Agreement is fully executed and the City agrees that Calabee's obligations under the
Loan and Security Agreement and satisfies the amount owed.
Isle] LR[94R9[*P►A
An analysis confirmed that the City has fully recovered its investment from this project
for the following factors:
City Council
December 2, 2014
Page 3 of 3
• Investment earnings from the loan exceeded the Local Agency
Investment Fund (LAIF) rates over the same period;'
• A majority of the principle and interest is paid; and
• The City received Sales and Property Tax revenues over the past 11
years approximately, as a result of this of the Restaurant operating in the
City.
Based on an assessment of circumstances effecting the existing default and future
repayment of the loan, there is a substantial risk that the City would not be able to
collect the full amount of principle and interest owing, and that the City may collect less
than the discounted amount being offered.
FISCAL IMPACT:
The current outstanding principle balance on the loan is $353,289.42. If the City
Council approves this Agreement and accepts $200,000.00 as a settlement, the
outstanding loan balance would be $153,289.42. However, the City has reserved the
amount of the outstanding principle in fund balance, so this proposed settlement will
not affect the current fiscal year's operations. In fact, this will allow the City to release
the reserved fund balance and the net amount of $153,289.42 will revert to unreserved
fund balance and be available to the City Council for redirection.
ATTACHMENTS:
A. Payoff and Release Agreement
B. Minutes of City Council Meeting of July 1, 2003
C. Loan and Security Agreement dated July 31, 2003
D. Letter to Calabee's dated July 31, 2013
E. Letter to Calabees dated November 20, 2013
1 LAIF is a pooled investment instrument administered by the State of California and is widely utilized by
municipalities in California. LAIF's rate of return is often used as a bench mark for rate of return
comparisons similar as utilized in this analysis.
ATTACHMENT A
PAYOFF AND RELEASE AGREEMENT
This Payoff and Release Agreement (this "Agreement') ismade as of October 27, 2014 (the "Effective Date") by
and between Calabee's, Inc., a California corporation ("Calabee's"), and the City of Temple City, California, a Charter City
(the "Ciff") (each a "Party' and together the "Parties"), with reference to the following facts.
RECITALS
WHEREAS, as of the Effective Date, Calabee's owes. the City certain monies pursuant to that certain Loan and
Security Agreement, effective as of August 11, 2003, by and between the City and Calabee's (the "Loan Aereement") (the
"Amount Owed");
WHEREAS, Calabee's and the City have agreed that upon the payment of U.S. Two Hundred Thousand Dollars
($200,000) (the "Pavoff Amount"), Calabee's will have fulfilled its obligations under the Loan Agreement and satisfied the
Amount Owed;
WHEREAS, the Parties agree that payment of the Payoff Amount to the City is contingent upon the sale or closure
of the Applebee's Neighborhood Grill and Bar restaurant located in Temple City, California, operated by Calabee's (the
"Restaurant");
WHEREAS, the Parties desire to memorialize their agreement that: (1) upon a sale or closure of the Restaurant,
Calabee's will pay the City the Payoff Amount; and (2) the City will execute and deliver a formal written document
acknowledging and agreeing that, among other things, the Payoff Amount will serve as payment in full by Calabee's such
that Calabee's has no further obligations under the Loan Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and agreements herein contained
and other consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows:
1. Recitals. The recitals set forth above are fully incorporated into this Agreement asif they were fully set forth
herein.
2. Term and Termination. The term of this Agreement shall be one hundred twenty (120) days. The Parties
recognize that Calabee's has been working to close or sell the Restaurant and that such sale or closure may
occur after the 120 -day term. Upon presentation to the City by Calabee's of the efforts exerted by Calabee's to
complete the sale or closure, the City may in its sole and unfettered discretion extend the term for up to an
additional ninety (90) days to allow for Calabee's to complete the sale or closure and make the payment
required by Section 2, below. No further extension or renewal is anticipated by this Agreement, and any delay
beyond the term (or term as extended by the City in its sole and unfettered discretion) shall cause the
termination of this Agreement and the reinstatement in full of Calabee's duties and responsibilities under the
Loan Agreement.
3, PavofF. Within thirty (30) days of the sale or closure of the Restaurant, Calabee's will deliver the Payoff
Amount to the City during normal City business hours. Upon mutual agreement of the Parties, the Payoff
Amount may be delivered by wire transfer; in the absence of such mutual agreement, the Payoff Amount will
be submitted to the City as a cashier's check.
4. Pavoff as Full Satisfaction. The City acknowledges and agrees that, upon receipt of payment in full of the
Payoff Amount, it will be paid in full for all amounts owed to it by Calabee's, specifically including but not
limited to the Amount Owed and any other amounts potentially owed under the Loan Agreement, and the City
is owed no other reimbursement, cash, property, or value of any kind by Calabee's.
5. Release. Upon payment of the Payoff Amount, the Parties on behalf of themselves, and their respective heirs,
executors, officers, directors, employees, constituents, residents, predecessor and successor entities and
assigns, hereby fully and forever release each other and their respective heirs, executors, officers, directors,
employees, constituents; residents, predecessor and successor entities and assigns from any claim, duty,
obligation, or cause of action, whether known or unknown, suspected or unsuspected, that has occurred up
until and including the Effective Date, including any and all claims relating to or arising from the Loan
Agreement and for any amounts owed by Calabee's to the City (including without limitation the Amount
Owed and the Payoff Amount). Until the Payoff Amount is paid to the City in the form required by Section 2
of this Agreement, the Loan Agreement and all terms and conditions thereof remain in full force and effect.
6. California Code Section 1542. Each Party hereby waives any and all rights under Section 1542 of the Civil
Code of California, and any similar applicable law which states in full (or otherwise in substance) as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER
FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS
HER SETTLEMENT WITH THE DEBTOR.
Each Party knowingly and willingly waives the provisions of Section 1542 of the Civil Code of California and
any similar applicable law which operates to bar the release of unknown claims, and acknowledges and agrees
that this waiver is an essential and material term of this Agreement
7. Miscellaneous. This Agreement and the documents and agreements referenced herein constitute the entire
agreement of the Parties pertaining transactions contemplated herein. Any and all other written or oral
agreements existing between the Parties regarding such transactions are expressly cancelled. This Agreement
may be modified only by a writing signed by the Parties. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together shall be deemed to constitute one (1)
instrument. This Agreement is governed by the laws of the State of California.
[Signature Page to Follow]
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of the Effective Date.
"CALABEE'S:"
CALABEE'S, INC.,
a Cahfornia corporation
By:
7. Bifone, Jr.
Chief Operating Officer
"CITY:"
CITY OF TEMPLE CITY, CALIFORNIA,
a Charter City
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ATTACHMENT B
City Council Minutes
July 1, 2003
Page 5
' C. CONSIDERATION OF AUTHORIZING THE CITY MANAGER TO SOLICIT
REQUESTS FOR PROPOSALS FOR RESIDENTIAL DESIGN STANDARDS AND
APPOINTING A RFP REVIEW TASK FORCE
City Manager Cole reviewed the staff report, stating the City Council was requested
to consider authorizing staff to solicit requests for proposals for residential design
standards and appoint a RFP Review Task Force. Council received a lot of input
from residents while • considering various residential development proposals
submitted for projects throughout the City. Mayor Pro Tem Zovak previously
suggested developing design standards for residential properties.
Council, as a legislative body, is charged with the authority to regulate residential and
commercial land use, but Is also bound by federal and state law to protect the rights
of property owners, These competing interests often cause the City to perform a
balancing test between the rights of existing property owners and those of the
developer. Courts have consistently ruled that if proposed development projects
meet the general zoning requirements, cities denying such projects are probably
violating the private property rights of the owner. This makes the inclusion of
carefully crafted design standards an important part of any city's Zoning Code and Is
one of the few ways to more carefully regulate development proposals.
In addition to soliciting requests for proposals for a residential design consultant, it
was recommended to appoint an RFP Review Task Force to review and interview the
RFP's and make a recommendation to the City Council. The Task Force would be
comprised of one City Councllmember, One Planning Commissioner, the City
Manager, the Director of Community Development and the Senior Planner. The Task
' Force would be subject to the requirements of the Brown Act.
Council discussed the focus of the Task Force Committee and Mayor Pro Tem Zovak
suggested the Committee make recommendation to the Council on their number one
selection. He also noted, when this issue was previously discussed, it was
suggested, in addition to residential standards, zoning standards and the ability to
downzone would be included in the RFP.
Councllmember Ardghl moved to authorize the City Manager to solicit requests for
proposals for residential design standards, including zoning standards and
downzoning, seconded by Councllmember Wong and unanimously carried.
There was Council consensus to appoint Mayor Pro Tem Zovak to the Task Force as
the Councllmember representative.
City Manager Cole estimated results of the RFP would be returned to the Task Force
in 7.8 weeks.
D. CONSIDERATION OF APPROVING A LOAN AND SECURITY AGREEMENT BY
AND BETWEEN THE CITY OF TEMPLE CITY, CALIFORNIA AND CALABEE'S,
INC. AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAID AGREEMENT
City Manager Cole presented a Loan and Security Agreement by and between the
City of Temple City, California and Calabee's Inc. He announced that Applebees, a
family style sit-down restaurant, was willing to negotiate with the City, and after an
initial contact a year ago, agreed to enter Into the proposed agreement and open a
restaurant in the City.
' Referring to his staff report, City Manager Cole reviewed the effort leading up to this
negotiation, including consideration of various ways to Improve the business climate,
Council's determination to extend the City's Redevelopment Area to encompass all of
Las Tunas Drive, soliciting public Input at three Community Forums, hiring a
City Council Minutes
July 1, 2003
Page 6
consultant to conduct a market survey, and extensive contacts and background work. '
With the first success of Starbucks Coffee opening in the City, Baskin-Robbins and
Togo's Sandwiches soon followed. After receiving a follow-up call from
representatives of Applebees who expressed an interest in opening a restaurant at
the former Conroy's Flowers and Mattress Discounters location at the corner of Las
Tunas Drive and Rosemead Boulevard, and with Council approval, discussions
between the broker and the City commenced. Within a month, consensus between
the landlord, the franchisee and the City was reached. In order to obtain this
consensus, the City was required to provide financing for the construction of the new
Applebee's. There was also an allowance for tenant improvement requested from
the City, The loan, in excess of $1M, provides for full repayment of principal end
interest at an interest rate at least twice the amount the City currently earns. Staff
recommended approval of the agreement.
In response to questions from Mayor Pro Tem Zcvak, City Manager Cole provided
the following information, In order to minimize risks, certain security terms were
placed In the agreement including a Uniform Commercial Code (UCC) filing and a
sinking fund whereby every month, if the business makes a profit, it will send 10% to
the City to hold in a sinking fund to immediately apply to any indebtedness. Also the
principal of Applebee's offered a personal guarantee during the first 3 years of the
agreement. The principal of Applebee's tuns four other Applebee's Restaurants,
including one in Monrovia, and fourteen Millie's Restaurants, He also worked for the
parent corporation of Soup Plantation and has run restaurants for over a decade,
The term of the loan Is twelve years at an interest rate of 41/2 percent. The interest Is
deferred until the second year of the loan, but will accrue so no interest will be lost.
After three years of operation, the sinking fund can be released, but only with the
City's approval. A pro forma was received and reviewed which indicates there is
enough profitability to pay the loan. It was the City's desire to have the principal
present this evening to answer questions, but he Was out of the country, He would
be able to come to a future meeting if Council desired.
It took three months to negotiate this deal with three parties involved. There was
compromise on the part of the City, the principal and the shopping center owner.
There will be an outside patio incorporated into the design,
In response to Mayor Pro Tem Zovak, City Attorney Marlin stated there Is certain
legislation that restricts what cities can and cannot do. Regarding SB 975, it was
determined that the City, :as a charter city, has the ability to exempt itself from the
public contracts code.
Linda Pavne, Chamber of Commerce President, asked how large the restaurant
would be and if it would be similar to the one in Monrovia that has a sport bar.
In response, City Manager Cole stated the restaurant would have approximately
5,000 square feet and would be a full service restaurant like the one in Monrovia,
The parking in the shopping center is adequate,
Councilmember Capra moved to approve a Loan' and Security Agreement by and
between the City of Temple City, California and Calabee's Inc. (Agreement), and
authorize the City Manager to execute said agreement, seconded by Councilmember
Wong and unanimously carried. I
9. COMMUNICATIONS — None
ATTACHMENT C
ORIGINAL.
LOAN AND SECURITY AGREEMENT BY AND BETWEEN
THE CITY OF TEMPLE CITY, CALIFORNIA
AND
CALABEE'S INC.
This Loan and Security Agreement (AGREEMENT) Is made by and between the
City of Temple City, California, a Charter City, (CITY) and Calabee's Inc., a
California Corporation (CALABEES).
RECITALS
WHEREAS, CITY desires to Improve the business environment throughout CITY,
thereby increasing revenues for CITY and retail opportunities for the residents of
CITY and surrounding communities; and,
WHEREAS, one of the goals of CITY's Business Retention and Attraction
Program is the location of a family style restaurant within CITY's corporate limits;
and,
WHEREAS, CALABEES operates several family style restaurants under the
Applebee's and Millie's trade names in the greater San Gabriel Valley; and,
WHEREAS, to overcome certain economic barriers to the entry of a family style
restaurant within CITY, CITY's City Council has determined that it Is in the best
interests of CITY and its residents to offer incentives to businesses; and,
WHEREAS, CITY's City Council has directed and authorized its City Manager to
negotiate a financing package with CALABEES to facilitate the construction and
operation of an Applebee's Restaurant (RESTAURANT) located on the northwest
corner of the intersection of Rosemead Boulevard and Las Tunas Drive (SITE);
and,
WHEREAS, both partles have negotiated, in good faith, and have come to
agreement on such a financing package.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1 —TERMS
1.1 AMOUNT
The amount of the financing package shall consist of two components: a grant
(to offset, in whole or In part, the costs of making necessary and customary
tenant Improvements at SITE) and a loan (to fund start-up and other operating
costs as determined by CALABEES). The amount of the grant shall be $135,000
Loan and Security Agreement — Calabees, Inc.
Page 2 of 6
and the principal amount of the loan shall be $1,105,000. The total financing
package shall be $1,240,000 (TOTAL FINANCING PACKAGE).
1.2 TERM
The TERM of the loan shall be 144 months (12 years).
1.3 RATE
The loan shall be made at an interest rate of 4.50% per annum.
1.4 AMORTIZATION
The loan shall be fully amortized for a period of 132 months (11 years).
1.5 DISBURSEMENT
The grant and loan portions of financing package shall be subject to
disbursement only subsequent to: 1) the execution of a lease agreement
between CALABEES and landlord of SITE; and, (2) upon CALABEES receiving
any and all permits from CITY necessary to construct RESTAURANT as defined
In EXHIBIT C. Upon execution of said lease, CALABEES shall provide a copy
thereof to CITY upon request of City Manager,
Disbursement shall be made within 14 days of receipt by CITY of a written
request by CALABEES (DISBURSEMENT DATE) and shall be disbursed at the
rate not to exceed $300,000 per month so long as CALABEES continues
constructlon of said RESTAURANT. The first date of the first month following
100% disbursement of the loan shall be the FINAL DISBURSEMENT DATE.
In the case that 100% of the loan amount has not been disbursed on the day of
opening of RESTAURANT, then the FINAL DISBURSEMENT DATE shall be
deemed to be the first day of the first month 60 days after the date of opening.
Further, the amount of the loan disbursed on the 6& day after opening of
RESTAURANT shall be used as the principal amount of the loan. This principal
amount shall be the total amount of the loan and any further amounts available to
CALABEES hereunder shall be deemed waived.
1.6 PAYMENTS
Payments shall become due to CITY from CALABEES commencing on the first
day of the thirteenth month after Applebee's opening date. Payments shall be
made in accordance with a Promissory Note (EXHIBIT "A").
1.7 ACCRUED INTEREST
Loan and Security Agreement-- Calabees, Inc.
Page 3 of 6
Interest shall accrue from the FINAL DISBURSEMENT DATE until FIRST
PAYMENT DATE. Such accrued interest shall be paid in 132 equal installments,
commencing with FIRST PAYMENT DATE. At the option of CITY (by its City
Manager), the amount of accrued interest may be offset by the amount of the
SINKING FUND as established under Section 2.2 hereof.
SECTION 2 — SECURITY INSTRUMENTS
2.1 PERSONAL GUARANTEE
Mr, John R. Bifone, as both President/CEO of CALABEES and as an individual,
shall provide CITY with a personal guarantee of payments for the first 38 months
of TERM. Such personal guarantee shall be in a form acceptable to the City
Manager and the City Attorney. Such Personal Guarantee shall be made
EXHIBIT "B" attached hereto,
2.2 SINKING FUND
During the first 12 months of RESTAURANT operation, CALABEES agrees to
deposit with CITY an amount equal to 10% of monthly net operating income of
Applebee's Temple City restaurant for the establishment of a SINKING FUND,
Said SINKING FUND shall be held by CITY or in the name of CITY. Funds
deposited into the SINKING FUND shall become property of CITY subject to
application and disbursement as contained in this AGREEMENT. CALABEES
shall make such SINKING FUND payments to CITY within 45 days of the close
of each calendar month. Upon submission of each monthly SINKING FUND
payment, CALABEES shall provide a financial statement supporting the amount
of said payment reviewed by CALABEE'S President/CEO or other competent
authorized officer of CALABEES. Such financial statements shall be held in
strictest confidence by CITY.
Funds In said SINKING FUND shall be placed in an interest bearing account by
CITY. Interest shall remain in said SINKING FUND and shall be used for the
purposes outlined herein. In the case of default by CALABEES hereunder funds
In said SINKING FUND shall be, at the sole discretion of the CITY's City
Man@er, applicable to any sums due CITY by CALABEES. Upon conclusion of
the 36" month of operation of the Temple City Applebee's, upon mutual
agreement of CITY's City Manager and CALABEES, the amount In said
SINKING FUND shall be disbursed to CALABEES and the SINKING FUND
closed,
2.3 UCC FILING
CALABEES hereby consents and CITY may, at Its sole option, determine to
further secure the financing package with a lien against the furniture, fixtures,
and equipment of RESTAURANT as allowed by the Uniform Commercial Code.
Loan and Security Agreement — Calabees, Inc,
Pago 4 of 6
2,4 FINANCIAL STATEMENTS
As a condition precedent to CITY's execution of AGREEMENT, CALABEES shall
provide CITY with financial statements for the accounting year of CALABEES last
closed, Further, CALABEES shall provide CITY with operating statements for
the unaudited months. During TERM, CALABEES shall provide CITY with
financial statements within six months of the close of the prior fiscal year,
CALABEES shall provide reviewed statements unless it has financial statements
which are prepared in accordance with a higher standard such as audited
financial statements in which case CALABEES shall provide the higher standard
financial statements.
2.5 PRO -FORMA
As a condition precedent to CITY's execution of AGREEMENT, CALABEES shall
provide CITY with a pro -forma of RESTAURANT'S operations. Said pro -forma
shall be developed using prevailing industry standards, CITY shall have no
obligation hereunder unless and until said pro -forma is approved by the City
Manager and City Attorney.
SECTION 3 — NOTICE
3,1 NOTICE TO CITY
Items to be sent to CITY shall be addressed as follows:
City of Temple City
Attn: Martin R. Cole, City Manager
9701 Las Tunas Drive
Temple City, California 91780
3,2 NOTICE TO CALABEES
Items to be sent to CALABEES shall be addressed as follows:
Calabee's Inc.
Attn: John R. Bifone, President/CEO
565 W. Lambert Road, Suite C
Brea, Callfornla 92821-3901
3.3 CHANGES IN NOTICE LOCATIONS
Either party hereto may change the location where it receives notice by providing
the other party with notification of such change at least 30 days prior to It taking
effect.
Loan and Security Agreement -- Calabees, Inc.
Page 6 of 6
SECTION 4 — DEFAULT
4.1 DEFAULT
Subsequent to disbursement, CALABEES shall utilize funds produced by the
financing package to construct and operate RESTAURANT utilizing applicable
Industry standards and best practices. in the event CALABEES is unable
perform its obligations hereunder by constructing and operating RESTAURANT
for the entire TERM of the promissory note, CiTY may, at its sole option, declare
CALABEES in default hereunder.
In the event of default, CALABEES shall return any unspent proceeds of
financing package. Further, in the event of default by CALABEES hereunder, the
CITY may, at its sole option, decline further disbursement of any funds due
CALABEES hereunder. Also, in the event of default, CITY may, at its sole
option, declare the entire outstanding principal and accrued Interest as
Immediately due and payable.
42 COOPERATION IN DEFAULT
Without waving any of its rights hereunder, CITY agrees to work cooperatively
with CALABEES in the event CITY declares CALABEES In default.
SECTION 5 — NON-DISCRIMINATION
5.1 NON-DISCRIMINATION
CALABEES covenants by and for itself, and any successors In Interest, that there
shall be no discrimination against or segregation of any person, or group of
persons, on account of sex, race, color, creed, national origin or ancestry, marital
status or handicap in the sale, lease, sublease, transfer, use, occupancy, tenure
or enjoyment of the SITE, nor shall CALABEES establish or permit any such
practice or practices of discrimination or segregation with reference to the
selection, location, number, use or occupancy of tenants, lessees, subtenants,
sublessees, or vendees of the SITE.
CALABEES for itself and its successors and assigns, agrees that In the
construction and operations of the improvements provided for in AGREEMENT,
CALABEES will not discriminate against any employee or applicant for
employment because of sex, race, color, creed, national origin or ancestry,
marital status, or handicap.
IN WITNESS WHEREOF, both parties execute this Agreement in triplicate by
their duly authorized and empowered representatives.
[signature page follows]
Loan and Security Agreement — Calaoees, Inc,
Page 6 of 6
C,TY OF TEMPLE CITY, CALIFORNIA
BY; 4yt o.. t:.7 vYL'k . uta
Martin R. Cole, MPA
ITS: City Manager
DATE: J AUrA ooa5
CA.ABEE'S, INC.
BY;
Joh R Bifone
ITS: PresidentlCEC
DATE: jk-J,,.t cat, X03
�l
Exhibit "A"
Loan and Security Agreement
City of Temple City and Calabee's Inc.
PROMISSORY NOTE
This Promissory Note (NOTE) is made by Calabee's, Inc. a California
Corporation (CALABEES) in evidence of Indebtedness to the City of Temple City,
a Charter City (CITY).
RECITALS
WHEREAS, CITY and. CALABEES are prepared to enter Into that certain Loan
and Security Agreement (AGREEMENT); and,
WHEREAS, on July 1, 2003, the City Council of CITY did approve the
AGREEMENT and authorize the City Managerto execute same; and,
WHEREAS, Section 1.5 of AGREEMENT provides for the execution of a
Promissory Note for the purposes of securing the Indebtedness contemplated
under AGREEMENT; and,
WHEREAS, this NOTE shall constitute the Exhibit "A" required by AGREEMENT,
NOW, THEREFORE, the parties hereto agree as follows;
SECTION 1 —TERMS
1.1 PRINCIPAL AMOUNT
The principal amount of the indebtedness secured hereby shall not exceed
$1,105,000. The actual'principal amount (ACTUAL PRINCIPAL AMOUNT) of the
Indebtedness shall be determined In accordance with Section 1.6 of
AGREEMENT.
1.2 TERM
The TERM of the loan shall be 144 months (12 years).
1.3 RATE
The loan shall be made at an interest rate of 4.50% per annum.
1.4 AMORTIZATION
The loan shall be fully amortized for a period of 132 months (11 years). Upon
determination of the ACTUAL PRINCIPAL AMOUNT, CITY shall create an
Promissory Note )
City of Temple City — Calabee's, Inc.
Page 2 of 4
amortization and payment schedule which shall become Exhibit 1 hereto and
shall be In substantially the same form as Exhibit 1X hereto.
SECTION 2 PROMISE TO PAY
2.1 ACKNOWLEDGEMENT OF VALUE RECEIVED
CITY shall make disbursements of principal amounts in accordance with Section
1.5 of AGREEMENT. By endorsing the warrants disbursing funds, CALABEES,
thereby, acknowledges the value thereof.
2.2 CALABEES PROMISE TO PAY
By executing this document, CALABEES acknowledges and accepts the
responsibility and obligation to repay said amount with interest to CITY as stated
In AGREEMENT and as further defined herein.
SECTION 3 —PAYMENTS
3.1 PAYMENTS
Payments shall become due to CITY from CALABEES commencing on the first
day of the thirteenth month after Applebee's opening date, Within 60 days of
Applebee's opening date, CITY shall cause a notice to be sent to CALABEES
Indicating the first payment date. Payments are due on the first day of each
calendar month and become delinquent on the fifteenth day of the same month
(DELINQUENT DATE). Should the DELINQUENT DATE fall on a Saturday,
Sunday, or holiday recognlzdd by CITY, the DELINQUENT DATE shall be the
next business day following said Saturday, Sunday, or holiday.
CALABEES shall make payments hereunder In accordance with Exhibit 1 hereto
without any additional notice or demand from CITY.
3.2 LATE FEE
Monthly payments (including principal, Interest, accrued interest, and/or late fees)
not received In accordance with Section 3.1 hereof may, at the sole discretion of
CITY'S City Manager, be assessed a late fee equal to 6% of the original payment
amount. CALABEE'S hereby consents and agrees to promptly pay any late fee
so assessed,
3.3 APPLICATION OF PAYMENTS
Payments shall be applied In the following precedence:
(1) Late Fees
Promissory Note '
City of Temple City -- Calabee's, Inc.
Page 3 of 4
(2) Accrued Interest
(3) Monthly Interest
(4) Principal
3.4 PAYMENT ADDRESS
Payments to CITY shall be made to the following address:
City of Temple City
Alin, Martin R. Cole, City Manager
9701 Las Tunas Drive
Temple City, Callfomia 9178D.
CITY may, with a minimum of 30 days' notice to CALABEES, change the
address to which payments shall be sent.
SECTION 4— DEFAULT
4.1 DEFAULT
Payments not received by CITY by 5:00 PM on the DELINQUENT DATE shall be
subject to a late fee and, at the sole discretion of CITY's City Manager, may
constiNte default hereunder and under AGREEMENT.
Should CITY's City Manager determine CALABEES to be in default, either
hereunder or under AGREEMENT, or both, City Manager shall send a notice of
default (NOTICE OF DEFAULT) to CALABEES. Said notice shall include, at a
minimum, (1) the action (or inaction) leading to the notice of default, and (2) the
action required to cure the default, CALABEES shall be provided with 15
calendar days from issuance of NOTICE OF DEFAULT to take the actions stated
therein. In the sole determination of CITY'S City Manager, should such default
continue after expiration of the 15 day period hereunder, City Manager may
suspend disbursements hereunder and take whatever additional actions
permitted by law to collect the amounts due CITY hereunder.
4.2 COOPERATION OF TERMS
This NOTE and AGREEMENT are meant to cooperate. In the case of conflict of
terms between said NOTE and AGREEMENT, the terms of AGREEMENT shall
prevail.
IN WITNESS WHEREOF, CALABEES executes this NOTE in triplicate by Its
duly authorized and empowered representative(s),
f ftnature Page Follows}
Promissory Note '
City of Temple City — Calaboe's, Inc.
Page 4 of 4
CALABEE'S, INC,
BY: +/
John R.BfOn f
ITS: President/CEO
1
DATE: J-mJq 3(,0003
U
`1
Promissory Note
Exhlbit 1X
Calabee's, Inc.
Amortizatlon and
Payment Schedule
Principal Amount: $1,105,000.00
Interest Rate:
4.50%
Term (months):
144
Payment
Accrues'
Totai'
Remaining
Date
Principal
Interest
Interest
Payment
Balance
Principal Amount
$1,106,000.00
01101/XO
$4,143,75
$0,00
$1,109,143.75
021011X0
$4,143.75
$0,00
$1,113,287.50
031011X0
$4,143,75
$0,00
$1,117,431,25
04/011X0
$4,143,75
$0.00
$1,121,575.00
05/011X0
$4,143,75
$0,00
$1,125,718,75
06101/XO
$4,143.75
$0.00
$1,129,862.60
07/01/X0
$4,143.76
$0,00
$1,134,005.26
08/01/XO
$4,143,75
$0,00
$1,138,150,00
09/01/X0
$4,143,76
$0.00
$1,142,293.75
101011X0
$4,143.76
$0.00
$1,146,437.60
11101!X0
$4,143,75
$0.00
$1,160,581,26
12101/X0
$4,143.75
$0,00
$1,154,725,00
01/011X1
$8,484.94
$4,143,75
$376,70
$11,005.40
$1,147,863.36
02/011X1
$5,509,26
$4,119,43
$376.70
$11,005,40
$1,140,977,39
03/011X1
$6,533.67
$4,095.02
076,70
$11,005,40
$1,134,067,01
04/01/X1
$6,568.17
$4,070.52
$376,70
$11,005,40
$1,127,132.13
05/011X1
$6,682,77
$4,046.93
$376.70
$11,005.40
$1,120,172,86
08/011X1
$6,607,45
$4,021,24
$378.70
$11,005.40
$1,113,168.61
071011X1
$6,632.23
$3,996,46
$376,70
$11,005,40
$4,105,179.57
08101/X1
$8,667,10
$3,971,59
070,70
$11,005,40
$1,099,146.77
09/01/X1
$6,682,06
$3,946,63
$376,70
$11,005.40
$1,092,087.00
10/01/X1
$6,707,12
$3,921,67
$376.70
$11,005.40
$1,086,003.17
11101/X1
$0,732.27
$3,896.42
$376.70
$11,005,40
$1,077,894.19
12101/X1
$6,757.62
$3,871.17
$376,70
$11,005.40
$1,070,759,97
01101/X2
$0,782,66
$3,845.63
$378.70
$11,005,40
$1,063,600.41
02/011X2
$6,508.30
$3,820,40
$37670
$11,005.40
$1,056,415.40
001/X2
$6,833.83
$3,794,87
$376.70
$11,005,40
$1,049,204.87
04/01/X2
$6,869.45
$3,789,24
$378.70
$11,006.40
$1,041,968,71
06/01/X2
$6,886.18
$3,743.$2
$376.70
$11,005.40
$1,034,706.83
08/01/X2
$6,911,00
$3,717,70
$376,70
$11,005,40
$1,027,419.13
07/011X2
$8,936,91
$3,891.78
$376.70
$11,005.40
$1,020,105,51
08/01/X2
$6,062,93
$3,665.77
$376.70
$11,005,40
$1,012,765.88
09/01/X2
$6,989.04
$3,639.60
$376.7D
$11,005.40
$1,005,400.14
10/011X2
$7,015,25
$3,613.45
$376.7D
$11,005,40
$998,008,19
11101/X2
$7,041,65
$3,687.14
$376,70
$11,005,40
$990,589,93
12/01/X2
$7,067,96
$3,560,73
976,70
$11,005.40
$983,146,27
Page 1 of 4
��) l
P r o m i s s o r y N o t e E x h i b i t 1 X
C a l a b e e ' s , I n c .
A m o r t i z a t i o n a n d P a y m e n t S c h e d u l e
P r i n c l p a l A m o u n t : $ 1 , 1 0 5 , 0 0 0 , 0 0
I n t e r e s t R a t e : 4 . 5 0 %
T e r m ( m o n t h s ) : 1 4 4
P a y m e n t
A c c r u e d
T o t a l
R e m a l n i n 9
D a t e
P r i n c i p a l
I n t e r e s t
I n t e r e s t
P a y m e n t
B a l a n c e
0 1 / N W
$ 7 , 0 9 4 , 4 0
$ 3 , 5 3 4 , 2 3
$ 3 7 6 , 7 0
$ 1 1 , 0 0 5 , 4 0
$ 9 7 5 , 6 7 4 . 1 0
0 2 1 0 1 / X 3
$ 7 , 1 2 1 . 0 7
$ 3 , 5 0 7 , 8 3
$ 3 7 6 , 7 0
$ 1 1 , 0 0 5 . 4 0
$ 9 6 8 , 1 7 6 . 3 3
W N W
$ 7 , 1 4 7 , 7 7
$ 3 , 4 8 0 , 9 2
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 , 4 0
$ 9 8 0 8 5 1 , 8 5
0 4 1 0 1 ( X 3
$ 7 , 1 7 4 , 6 8
$ 3 , 4 5 4 , 1 2
$ 3 7 6 . 7 0
$ 1 1 , 0 0 6 , 4 0
$ 9 5 3 , 1 0 0 . 5 7
0 6 / 0 1 M
$ 7 , 2 0 1 , 4 8
$ 3 , 4 2 7 . 2 1
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 . 4 0
$ 9 4 5 , 5 2 2 . 3 9
0 8 1 0 1 / X 3
$ 7 , 2 2 8 . 4 9
4 3 , 4 0 0 . 2 1
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 . 4 0
$ 9 3 7 , 9 1 7 . 2 0
0 7 / 0 1 1 X 3
$ 7 , 2 5 5 , 6 9
$ 3 , 3 7 3 , 1 0
$ 3 7 8 , 7 0
$ 1 1 , 0 0 5 . 4 0
$ 9 3 0 , 2 8 4 . 9 0
0 8 1 0 1 M
$ 7 , 2 8 2 . 8 0
$ 3 , 3 4 5 , 8 9
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 . 4 0
$ 9 2 2 , 6 2 6 , 3 9
0 9 1 0 1 7 X 3
$ 7 , 3 1 0 , 1 1
$ 3 , 3 1 8 , 5 8
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 . 4 0
$ 9 1 4 , 9 3 8 . 6 7
1 0 1 0 1 / X 3
$ 7 , 3 3 7 , 6 3
$ 3 , 2 8 1 , 1 7
$ 3 7 8 . 7 0
$ 1 1 , 0 0 5 . 4 0
$ 9 0 7 , 2 2 4 . 3 5
1 1 / 0 1 / X 3
$ 7 , 3 6 5 , 0 4
$ 3 , 2 6 3 , 6 5
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 . 4 0
$ 8 9 9 , 4 8 2 , 6 0
1 2 1 0 1 1 X 3
$ 7 , 3 9 2 . 6 6
$ 3 , 2 3 6 . 0 3
$ 3 7 6 , 7 0
$ 1 1 , 0 0 6 . 4 0
$ 8 9 1 , 7 1 3 . 2 4
0 1 1 0 1 / X 4
$ 7 , 4 2 0 . 3 8
$ 3 , 2 0 8 , 3 1
$ 3 7 6 , 7 0
$ 1 1 , 0 0 5 . 4 0
$ 8 6 3 , 9 1 6 . 1 6
0 2 / 0 1 / X 4
$ 7 , 4 4 8 2 1
$ 3 , 1 6 0 . 4 8
$ 3 7 6 , 7 0
$ 1 1 , 0 0 5 . 4 0
$ 6 7 6 , 0 9 1 . 2 4
0 3 1 0 1 / X 4
$ 7 , 4 7 6 . 1 4
$ 3 , 1 5 2 . 5 5
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 . 4 0
$ 8 6 8 , 2 3 8 , 3 9
0 4 / 0 1 / X 4
$ 7 , 5 0 4 , 1 7
$ 3 , 1 2 4 , 5 2
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 . 4 0
$ 8 6 0 , 3 6 7 , 5 1
0 5 / 0 1 / X 4
$ 7 , 5 3 2 . 3 2
$ 3 ; 0 9 8 . 3 8
$ 3 7 0 . 7 0
$ 1 1 , 0 0 5 , 4 0
$ 8 5 2 , 4 4 8 . 4 9
0 6 1 0 1 ! X 4
$ 7 , 6 6 0 , 5 6
$ 3 , 0 6 8 , 1 3
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 , 4 0
$ 8 4 4 , 5 1 1 . 2 3
M O M
$ 7 , 5 8 8 . 9 1
$ 3 , 0 3 9 . 7 8
$ 3 7 6 , 7 0
$ 1 1 , 0 0 5 , 4 0
$ 5 3 8 , 5 4 5 , 0 1
0 8 / 0 1 / X 4
$ 7 , 6 1 7 , 3 7
$ 3 , 0 1 1 . 3 2
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 , 4 0
$ 8 2 8 , 6 5 1 . 6 3
0 9 ! 0 1 / X 4
$ 7 , 6 4 5 . 9 4
$ 2 , 9 1 3 2 , 7 6
$ 3 7 6 , 7 0
$ 1 1 , 0 0 5 . 4 0
$ 8 2 0 , 5 2 8 , 8 9
1 0 / 0 1 1 X 4
$ 7 , 6 7 4 , 6 1
$ 2 , 9 5 4 . 0 6
$ 3 7 5 , 7 0
$ 1 1 , 0 0 6 . 4 0
$ 8 1 2 , 4 7 7 . 5 7
1 1 1 0 1 1 X 4
$ 7 , 7 0 3 , 3 9
$ 2 , 9 2 5 , 3 0
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 , 4 0
$ 8 0 4 , 3 9 7 . 4 8
1 2 / 0 1 / X 4
$ 7 , 7 3 2 . 2 8
$ 2 , 8 9 6 . 4 2
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 . 4 0
$ 7 9 6 , 2 8 8 , 5 0
0 1 1 0 1 1 X 5
$ 7 , 7 8 1 , 2 7
$ 2 , 8 6 7 . 4 2
$ 3 7 6 , 7 0
$ 1 1 , 0 0 6 , 4 0
$ 7 6 8 , 1 6 0 , 6 2
0 2 1 0 1 1 X 6
$ 7 , 7 9 0 , 3 8
$ 2 , 8 3 8 . 3 2
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 , 4 0
$ 7 7 9 , 9 8 3 . 4 4
0 3 / 0 1 1 X 6
$ 7 , 8 1 9 , 5 9
$ 2 , 8 0 9 . 1 0
$ 3 7 8 . 7 0
$ 1 1 , 0 0 5 . 4 0
$ 7 7 1 , 7 8 7 , 1 4
0 4 / 0 1 / X 5
$ 7 , 8 4 8 , 9 2
$ 2 , 7 7 9 , 7 6
$ 3 7 6 , 7 0
$ 1 1 , 0 0 6 , 4 0
$ 7 6 3 , 5 6 1 , 5 2
0 5 1 0 1 / X 6
$ 7 , 8 7 8 . 3 5
$ 2 , 7 5 0 . 3 4
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 , 4 0
$ 7 5 5 , 3 0 6 , 4 7
0 6 1 0 1 1 X 6
$ 7 , 9 0 7 , 8 9
$ 2 , 7 2 0 , 8 0
$ 3 7 6 , 7 0
$ 1 1 , 0 0 6 . 4 0
$ 7 4 7 , 0 2 1 . 8 7
0 7 1 0 1 / X 6
$ 7 , 9 3 7 . 5 6
$ 2 , 0 9 1 , 1 6
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 , 4 0
$ 7 3 8 , 7 0 7 . 6 2
0 8 / 0 1 1 X 5
$ 7 , 9 6 7 . 3 1
$ 2 , 8 0 1 . 3 6
$ 3 7 6 . 7 0
$ 1 1 , 0 0 5 , 4 0
$ 7 3 0 , 3 6 3 . 6 0
0 9 / 0 1 / X 5
$ 7 , 9 9 7 . 1 9
$ 2 , 6 3 1 . 5 0
$ 3 7 6 . 7 0
$ 1 1 , 0 0 6 . 4 0
$ 7 2 1 , 9 8 9 , 7 1
1 0 / 0 1 1 X 6
$ 8 , 0 2 7 . 1 8
$ 2 , 0 0 1 . 5 1
$ 3 7 6 , 7 0
$ 1 1 , 0 0 6 , 4 0
$ 7 1 3 , 5 8 6 . 8 2
1 1 1 0 1 / 0
$ 8 , 0 5 7 . 2 8
$ 2 , 5 7 1 , 4 1
$ 3 7 6 , 7 0
$ 1 1 , 0 0 5 , 4 0
$ 7 0 5 , 1 6 1 , 8 3
1 2 1 0 1 / X 6
$ 6 , 0 8 7 , 6 0
$ 2 , 8 4 1 , 2 0
$ 3 7 6 . 7 0
$ 1 1 , 0 0 6 . 4 0
$ 6 9 6 , 6 6 7 . 6 3
P a g e 2 o f 4
Promissory Note Exhibit 1X
Calabee's, Inc.
Amortization and Payment Schedule
Principal Amount: $1,106,000,00
Interest Rata: 4.60%
Term (months): 144
Payment
AQor4ecl'
Totai
Remaining'
Date
Principal
Interest
interest
Payment
Balance
01/01/X6
$8,117,82
$2,610.87
$376,70
$11,005.40
$688,193.10
02101/X6
$8,148,27
$2,480,43
$376,70
$11,006.40
$879,688,13
03101/X6
$8,178,82
$2,449,87
$376.70
$11,005.40
$671,112,61
04101/X6
$8,209,49
$2,419.20
$376.70
$11,005.40
$662,628,41
06101/X8
$8,240,28
$2,388,41
$376.70
$11,005.40
$653,909,42
081011X6
$8,271.18
$2,307,61
$376,70
$11,006.40
$646;261.64
071011X6
$8,302,20
$2,326,60
$378,70
$11,005.40
$636,582,64
08101/X0
$8,333,33
$2,295.36
$376,70
$11,005,40
$627,872.60
09(01/X6
$6,384.58
$2,254.11
$376.70
$11,005.40
$619,131.32
10/01/X6
$8,396.95
$2,232,76
$376,70
$11,006.40
$610,368,67
111011X6
$8,427.43
$2,201.26
$376.70
$11,005.40
$601,554,63
12/01!X6
$6,469.03
$2,169.06
$376.70
$11,006.40
$592,718,79
01/011X7
$8,490.76
$2,137.94
$370.70
$11,006.40
$683,851,33
02101/X7
$8,622.60
$2,106,10
$370,70
$11,005,40
$574,952.03
031011X7
$8,554.56
$2,074.14
$376,70
$11,005.40
$566,020,77
04101!X7
$8,586.64
$2,042,06
$376,70
$11,005.40
$557,057.43
061011X7
$8,618.84
$2,009,86
$376,70
$11,006.40
$548,061,89
06101/X7
$8,651.10
$1,977.54
$370,70
$11,006.40
$639,034.03
07!01/X7
$6,663,60
$1,945.09
$376.70
$11,005,40
$529,973,72
08/01/X7
$8,718.16
$1,912,63
'$376.70
$11,006A0
$520,880,86
09/01/X7
$0,748,85
$1,879.85
$376,70
$11,005.40
011,756.31
10101!X7
$8,781,66
$1,847.04
$378.70
$11,005.40
$502,596.95
11101/X7
$6,814,59
$1,814,11
$376.70
$11,005.40
$493,406.65
121011X7
$8,047.64
$1,781.05
$370,70
$11,005,40
$484,181.31
01/01/X8
$8,880,82
$1,747.87
$376.71
$11,005.40
$474,923.78
02101/X8
$8,914,12
$1,714,57
$376.70
$11,005.40
$465,632,96
031011X5
$8,947.56
$1,681.14
$376.70
$11,006,40
$456,308,70
04101/X8
$8}981.10
$1,647.69
$376.70
$11,005,40
$446,950,89
06101/X8
$9,014,78
$1,613,91
$376,70
$11,005,40
$437,559.40
061011X8
$9,048,69
$1,580.10
$37670
$11,005,40
$428,1$4.11
07!01/X8
$9,082.62
$1,646.17
$376.70
$11,005,4D
$418,674,88
081011X8
$9,116,68
$1,512.11
$376,70
$11,005,40
$409,181,60
09101/X6
_$9,160.77
$1,477.93
$376,70
$11,005,40
$309,654.13
10101/X8
$9,105.08
$1,443,61
$376.70
$11,006,40
$390,092,34
11101/X6
$9,219,53
$1,409.17
$376,70
$11,005,40
$380,496.11
121011X8
$9,254.10
$1,374.59
$378.70
$11,005,40
$370,665,30
Page 3 of 4
Promissory Note Exhibit 1X
Calabee's, Inc.
Amortization and Payment Schedule
Principal Amount; $1,105,000,00
Interest Rate; 4,50%
Term (months); 144
Payment
Accrues'
Total
Remaining
Date
Principal
Interest
Interest
Payment
Balance
011011X9
$9,288,80
$1,339,89
$376,70
$11,006.40
$361,199.79
02101/X9
$9,323,84
$1,305,06
$376,70
$11,006,40
$361,499.45
03/01/X9
$9,358.60
$1,270,09
$376.70
$11,005.40
$341,764.15
04/011X9
$9,393,69
$1,236,00
$376.70
$11,006.40
$331,993,75
05/01/X9
$9,428,92
$1,199,77
$376,70
$11,005.40
$322,168,12
08101/0
$9,404.28
$1,104.41
$376,70
$11,005,40
$312,347,14
071011X9
$9,499.77
$1,128,92
$370.70
$11,005.40
$302,470.66
08/011X9
$9,635,39
$1,093,30
$376,70
$11,005.40
$292,658.56
09101!X9
$9,671.15
$1,057.64
$376.70
$11,005.40
$282,610.71
10101/X9
$9,607.04
$1,021.65
$376,70
$11,005.40
$272,626.96
11101/X9
$9,643.07
$985,62
$376.70
$11,005.40
$262,607.18
12101/X9
$9,679.23
$949,46
$376.70
$11,006,40
$262,551.24
01101/X10
$0,715.53
$913,16
$376.70
$11,005,40
$242,459.01
02/011X10
$9,751.96
$876.73
$376,70
$11,006.40
$232,330,34
03(01/X10
$9,758,53
$840,16
$376.70
$11,005.40
$222,165.11
04/01/X10
$9,826.24
$80146
$376.70
$11,005,40
$211,963.16
05/01/X10
$9,852.08
$768,61
$376,70
$11,005.40
$201,724,37
061011X10
$9,899,07
$729,83
$376,70
$11,005.40
$191;448.60
07101/X10
$9',936,19
$692.60
$376,70
$11,006,40
$181,135,71
081011X10
$9,973.45
$65524
$376,70
$11,005.40
$170,786.66
09101/X10
$10,010,85
$617.84
$$76.70
$11,006.40
$160,398.00
10101/X10
$10,048,39
$580.30
$376,70
$11,005,40
$149,972.91
11101/X10
$10,086,07
$542,62
$378,70
$11,005,40
$139,510.13
12/01/X10
$10,123.89
$504.80
$376,70
$11,005.40
$129,009.63
011011X11
$10,161.86
$466,83
$376,70
$11,005.40
$116,470.97
02/01/X11
$10,199,97
$428,73
$376,70
$11,006.40
$107,894.30
03101/X11
$10,238.22
$390,48
$376.70
$11,006,40
$97,279.38
04/01/X11
$10,270.61
$352.06
$378,70
$11,005,40
$86,626.06
05/011X11
$10,315,15
$313.55
$376,70
$11,006.40
$75,934.21
08/01/X11
$10,353.83
$274.88
$376,70
$11,005.40
$66,203.88
07/01/X11
$10,392,66
$236,04
$376,70
$11,005.40
$54,434.32
08/011X11
$10,431.63
$197.07
$378.70
$11,005,40
$43,626.98
091011X11
$10,470,76
$157,95
$378,70
$11,006A0
$32,778,53
10101/X11
$10,510,01
$118.68
$376,70
$11,005,40
$21,891,82
11/01/X11
$10,549.42
$79,27
$376.70
$11,005.40
$10,965.69
12/011X11
$10,588,98
$39.71
$376,70
$11,005,40
$0.00
Page 4 of 4
Exhibit 'V
Loan and Security Agreement
City of Temple City and Calabee's Inc,
AGREEMENT GUARANTY,
This GUARANTY ("GUARANTY") Is made as of the date set forth, below
by the undersigned ("GUARANTOR"), in favor of The City of Temple City, a
Charter City ("CITY").
WHEREAS, CiTY has entered into that certain Loan and Security
Agreement ("AGREEMENT") with Calabee's, Inc., D,BA Applebee's, a California
corporation ("CALABEES"), regarding the construction and operation of an
Applebee's Restaurant at that certain premises and improvements located at
5701 Rosemead Boulevard, Temple City, California 91780 ("Project"); and
WHEREAS, GUARANTOR Is the Chief Executive officer of CALABEES
and has a substantial financial, ownership, or controlling interest in CALABEES;
and
WHEREAS, to Induce CITY to enter Into the AGREEMENT and to
undertake various actions in connection therewith, GUARANTOR has agreed to
GUARANTY the performance of each and every obligation of CALABEES under
and arising from the AGREEMENT;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, receipt of which Is hereby acknowledged, GUARANTOR
agrees with CITY as follows:
1. GUARANTOR unconditlonally,and irrevocably guarantees the prompt
payment of all sums due under the AGREEMENT and the prompt performance of
all other obligations of CALABEES uhder and arising from the AGREEMENT (the
"Obligations"). The AGREEMENT for the purposes of this GUARANTY shall
include any and all amendments, modifications and extensions thereof as well as
any documents or agreements referred to therein regardless of whether
GUARANTOR has consented to or has been notified of such changes, This Is a
continuing GUARANTY. With regard to the payment of sums due under the
AGREEMENT, this GUARANTY is a GUARANTY of payment and not only a
GUARANTY of collection,
2. The obligations of GUARANTOR hereunder are independent of the
obligations of CALABEES, and a separate action or actions may be brought and
prosecuted against GUARANTOR whether or not an action is brought against
CALABEES or any other person, or whether or not CALABEES or any other
person is joined in any such.action or actions, GUARANTOR acknowledges that
there are no conditions precedent to the effectiveness of this GUARANTY, and
that this GUARANTY Is in full force and effect and is binding on GUARANTOR as
of the date this GUARANTY Is executed by GUARANTOR. GUARANTOR
waives the benefit of any statute of limitations affecting its liability hereunder or
the enforcement thereof, and agrees that the payment of any Obligations or any
other act which shall toll any statute of limitations applicable thereto shall
similarly operate to toll such statute of limitations applicable to GUARANTOR's
liability hereunder. The liability of GUARANTOR hereunder shall be reinstated
and revived and the rights of CITY shall continue if and to the extent for any
reason any amount at any time paid on account of any obligations is rescinded
or must be otherwise restored by CITY, whether as a result of any proceedings in
bankruptcy or reorganization or otherwise, all as though such amount had not
been paid. The determination as to whether any amount so paid must be
rescinded or restored shall be made by CITY in Its sole discretion,
3. GUARANTOR authorizes CITY, without notice to or demand on
GUARANTOR, and without affecting GUARANTOR's liability hereunder, from
time to time to: (a) alter, compromise, renew, extend, accelerate or otherwise
change the time for payment, or other performance under the AGREEMENT or
otherwise change the terms of .the Obligations or any part thereof; (b) take and
hold collateral security for the payment of this GUARANTY or the Obligations or
any portion thereof, and exchange, enforce, waive and release any such
collateral security; (c) apply such collateral security and direct the order or
manner of sale thereof; (d) release or substitute any one or more of the
endorsers or any other GUARANTORs of the Obligations, or any part thereof, or
any other party thereto; and (e) apply payments received by CITY from
CALAt3EES to the Obligations in such order as CITY shall determine in its sole
discretion, and GUARANTOR hereby waives any provision of law regarding
application of payments which specifies otherwise,
4. GUARANTOR represents and warrants to CITY that; (a) if
GUARANTOR is a corporation, partnership, trust, limited liability company or
other entity, the execution and delivery by GUARANTOR of this GUARANTY and
the performance by it of its obligations under this GUARANTY are within its
powers and have been duly authorized by all necessary action; (b) this
GUARANTY constitutes the valid and binding obligation of GUARANTOR,
enforceable against it in accordance with its terms; (c) the execution ,and
delivery of this GUARANTY by GUARANTOR do not violate or conflict, with any
Instrument or agreement or any order of any court or administrative agency
binding on GUARANTOR or any of its properties or assets; (d) neither the
making nor the performance of this GUARANTY by GUARANTOR requires the
approval of or notice to any governmental authority or body or any third party; (e)
GUARANTOR has not and shall not, without the prior written consent of CITY,
sell, lease , assign, encumber, hypothecate, transfer or otherwise dispose of all
or a substantial or material part of Its assets; (f) CITY has made no repre-
sentation or warranty to GUARANTOR as to the creditworthiness of CALASEES;
and (g) GUARANTOR has established adequate means of obtaining from
CALABEES on a continuing basis financial and other Information pertaining to
CALABEES's financial condition.
5. GUARANTOR agrees to keep adequately informed by such means of
any facts, events or circumstances which might in anyway affect GUARANTOR's
risks hereunder, and GUARANTOR further agrees that CITY shall have no
obligation to disclose to GUARANTOR any Information or material about
CALABEES which is acquired by CITY in any manner.
6. GUARANTOR walves any right to require CITY to; (a) proceed first
against any other person, Including CALABEES; (b) proceed first against or
exhaust any collateral seourlty received from CALABEES or any other person; (c)
pursue any other remedy in CITY's power; or (d) make any presentment or
demand for performance, or give any notice of nonperformance, protest, notice of
protest or notice of dishonor in connection with the Obligations.
7. GUARANTOR waives any rights and any defenses to the performance
of Its obligations under this GUARANTY based upon or arising by reason Of', (a)
any disability or other defense of CALABEES or any other person to the payment
of the Obligations when due; (b) the termination or expiration from any cause
whatsoever, other than full and timely performance of the Obligations; (c) any
act or omission by CITY which directly or indirectly results in or aids the
discharge of CALABEES or the Obligations by operation of law or otherwise; (d)
any modification of the Obligations, in any form whatsoever; or (e) any rights or
defenses available to GUARANTOR under or by the operation of Sections 2787
through 2855 of the California Civil Code and all equivalent and. similar statutes
of any other jurisdiction applicable to GUARANTOR,
S. GUARANTOR warrants and agrees that each of the waivers set forth
above Is made with GUARANTOR's full knowledge of its significance and
consequences, and that under the circumstances, the waivers are reasonable
and not contrary to public policy or law. If any of said waivers are determined to
be contrary to any applicable law or public policy, such waivers shall be effective
only to the extent permitted by law,
9, Until the Obligations shall have been paid and performed in full,
GUARANTOR shall:
(a) as soon as available, and in any event within 160 days after the end of
each fiscal year of GUARANTOR, provide CITY with a copy of the
reviewed financial statements of GUARANTOR for such year (unless
audited financial statements are available). The reviewed statement shall
be reviewed by GUARANTOR's independent public accountants who shall
be reasonably acceptable to CITY;
(b) deliver to CITY within 30 days after the filing thereof true and correct
copies of its federal and state income tax returns for each year;
(c) deliver to CITY upon request such other information concerning
GUARANTOR as CITY may reasonably request from time to time.
10. Any. Indebtedness of CALABEES to GUARANTOR is hereby
subordinated to the Obligations, Such Indebtedness of CALABEES to
GUARANTOR Is assigned to CITY as security for this GUARANTY and the -
Obligations and, if CITY requests, shall be collected and received by
GUARANTOR'as trustee for CITY and paid over to CITY on account of the
Obligations but without reducing or affecting In any manner the liability of
GUARANTOR under the other provisions of this GUARANTY. Any notes now or
hereafter evidencing such Indebtedness of CALABEES to GUARANTOR shall be
marked with a legend that it is subject to this GUARANTY and, if CITY so
requests, shall be delivered to CITY. GUARANTOR will, and CITY is hereby
authorized, in the name of GUARANTOR from time to time, to execute and file
financing statements and continuation statements and execute such other docu-
ments and fake such other actions as CITY deems necessary or appropriate to
perfect, preserve and enforce its rights hereunder.
11. GUARANTOR waives any rights of subrogation to which It might
otherwise be entitled against CALABEES until such time as the Obligations have
been paid in full,
12. GUARANTOR acknowledges that CITY has the right to sell, assign,
sublease or otherwise transfer all or any part of its rights under the
AGREEMENT, including this GUARANTY, In connection therewith, CITY may
disclose all documents and information which CITY now has or hereafter
acquires relating to GUARANTOR and this GUARANTY, whether furnished by
CALABEES, GUARANTOR or otherwise.
13. GUARANTOR represents and warrants that all Information given to
CITY pertaining to GUARANTOR and which may be given to CITY in the future,
including but' not limited to Its financial condition, is true and complete. Any
misstatement or Inaccuracy in such information shall be deemed a material
default under this GUARANTY. Any such Information may be relied upon by
CITY's lenders and any successors or assigns of CITY.
14. GUARANTOR shall pay to CITY Immediately upon demand the full
amount of all payments, advances, charges, costs and expenses, including
without limitation reasonable attorneys' fees, incurred by CITY In connection with
the enforcement or preservation of its rights under this GUARANTY and/or the
collection of any of the Obligations, together with interest at a rate per annum
equal to the prime bank lending rate stated in the Wall Street Journal (or If not
available then a similar newspaper of national distribution) plus four percent (4%)
;1
or the maximum rate then allowable by law on similar obligations, for each day
any such amount is unpaid after such demand,
15, Until the Obligations have been paid and performed in full,
GUARANTOR shall upon 10 days prior notice provide, at GUARANTOR's sole
cost and expense, a certificate to CITY which states that this GUARANTY Is in
full force and effect without modification (or If modified containing a description of
such modification with copies of any agreements which have made such
modification), that GUARANTOR Is not in default under the terms of this
GUARANTY), and such other Items which CITY reasonably requests, Any such
statement may be conclusively relied upon by any prospective purchaser or
encumbrancer of the Premises. Failure to comply with this paragraph shall be a
material breach of this GUARANTY and GUARANTOR shall be liable for all
damages Incurred by CITY Including any loss of a loan or sale which may result
from such failure by Lessee. Without waiving such default, In the event
GUARANTOR falls to provide such certificate In the time period or manner set
forth above, CITY may elect to provide Its own statement which shall be
conclusive upon GUARANTOR.
16. Unless expressly provided otherwise herein, all notices, demands,
approvals and other communications provided for herein shall be In writing and
be delivered by telecopy, overnight delivery service, mail or personal delivery to
the appropriate party at its address as follows,. if to GUARANTOR, at the
address set forth below GUARANTOR's signature; and if to CITY, at the address
set forth in the AGREEMENT.
All notices and other communications shall be deemed to have been duly given
on (1) the date of delivery if personally delivered or sent by overnight delivery
service, (11) three days after deposit In the malls if sent by first class mall, or (Iii)
on the date a legible copy is received by the addressee, If transmitted by
telecopier or facsimile machine, whichever shall first occur, A party's address for
notice may be changed from time to time by written notice to the other party.
17, This GUARANTY supersedes all previous agreements between or
among the parties with regard to the terms and conditions addressed herein.
There are no agreements, representations, or warranties between or among the
parties other than those set forth In this GUARANTY or the documents and
agreements referred to in this GUARANTY. This GUARANTY shall be binding
upon GUARANTOR and its successors and assigns and Inure to the benefit of
CITY and Its successors and assigns, and shall be governed by and construed in
accordance with the laws of the State of California, without reference to the
choice of law principles thereof. GUARANTOR irrevocably submits to the
exclusive jurisdiction of any federal or state court located in Los Angeles County,
California, In connection with any dispute arising under or In connection with this
GUARANTY and consents to service of process by any means permitted under
the laws of the State of California.
18. If more than one person or entity executes this GUARANTY,
references to GUARANTOR shall include each and all such persons or entitles
and the representations, warranties, obligations and undertakings of each person
or entity shall be joint and several. This GUARANTY, was executed voluntarily
without any duress or undue Influence. GUARANTOR acknowledges that it has
read and understood this GUARANTY and Its legal effect. GUARANTOR
acknowledges that it has had a reasonable opportunity to obtain Independent
legal counsel for advice and representation in connection with this GUARANTY.
GUARANTOR represents and warrants that this GUARANTY is a binding
obligation thereon fully enforceable in accordance with Its terms. If this
GUARANTY is signed by a corporation or other entity the person signing this
GUARANTY on behalf of such entity represents and warrants that he/she has full
authorlty to bind such entity and that all requisite action has been taken by such
entity to authorize such action.
19. GUARANTOR hereby Irrevocably waives all right to trial by jury in any
litigation, action, proceeding or counterclaim arising out of or in any way relating
to this GUARANTY or any other document or agreement related to the
transactions contemplated hereby.
20. GUARANTOR further represents and warrants that:
(a) if GUARANTOR is an individual, GUARANTOR is above the legal age
of majority;
(b) GUARANTOR is authorized to enter Into this GUARANTY and the
entering into this GUARANTY and or the performance of
GUARANTOR's obligations under this GUARANTY shall not result in a
violation or breach any agreement or law binding thereon or applicable
thereto;
(c) GUARANTOR is solvent as such term is defined under applicable laws
Including bankruptcy and creditors rights laws and entering Into, this
GUARANTY and performing GUARANTOR's obligations under this
GUARANTY shall not render GUARANTOR Insolvent.
21, This GUARANTY shall expire on the third anniversary date of the
under the AGREEMENT provided no default exists or has occurred prior to such
date under the AGREEMENT or this GUARANTY and or no action has been
iniflated to enforce any rights under this GUARANTY.
IN WITNESS WHEREOF, GUARANTOR has caused this GUARANTY to
be executed by its duly authorized representative as of the date set forth below,
GUARANTO ,
r'r✓
John R. Bif ne
-IA;
Date
Notice Address:
565 West Lambert Road, Suite C
Brea, California 92821-3901
Telecopy: (714) 671-7957
Telephone: (714) 671.0772
FRAKRIBI 66C"
The following is a list of pre -construction and construction permits
that must be either approved or pulled prior to construction:
Fre-construction permit: Conditional Use Permit Application
(including plot plan and floor plan, subject to
City approval)
Construction permits: .Demolition per-mit(s)
Building permits (including plan check)
Electrical permit
Plumbing porn -At
Mechanical permit
Sanitary Sewer permit
Industrial Waste
health Department clearance
N.\WordlDopartnw¢t1CUll1BliWVtpplebea's ByNbit C • r WVa to wWtruotlon and prc-consttuction pamvts doc
July 31, 2013
ATTACHMENT D
9701 LA5 TVNA5 ORIVE 9 TEMPLE CITY • CALIFORNIA 91780-2249 a (6 261 286-2171
Calabee's Inc.
Attention: John R. Biafone, President/CEO
565 West Lambert Road, Suite C
Brea, California 92821-3901
Re: Default on Loan and Securitv Agreement with Citv of Temple Citv
Dear Mr, Blafone:
I am writing to you on behalf of the City of Temple City, which under the above -referenced
agreement ("Agreement") lent to Calabee's Inc. the sum of One Million Sixty -Five Thousand
Dollars ($1,065,000,00) to aid in the construction and initiation of Celebes's restaurant business
in the City. Calabee's had, until May 2013, made its regular monthly payments of principal and
Interest to the City as required by the agreement and the Promissory Note. The City did not
receive pavment in April 2013 and has not received Pavment in May 2013, June 2013 or July
2013.
Calabee's has therefore failed to meet its. obligation to repay the loan as set forth in the
Agreement and the Promissory Note, and as required by Section 4.1 of the Agreement the City
is declaring Calabee's to be in default of the Agreement and the Promissory Note.
Pursuant to Section 4:2 of the Agreement, and reserving all rights to proceed with any remedies
available to it should the parties not be able to resolve the default, the City agrees to work
cooperatively with Calabee's to reach such resolution, if such is possible and if Calabee's works
with the City in a responsive and prompt manner to accomplish such. Please contact me at
(626) 285-2171 at your earliest convenience, but no later than Friday, August 9, 2013, to
discuss those options available to Calabee's and the City that will allow us to effectively resolve
this default.
Very truly yours,
p''vy-arfi
Jose E. Pulldo
City Manager
LA #4814-8473-9861 v1
July 31, 2013
9701 LAS TUNAS DRIVE • TEMPLE CITY m CALIFORNIA 91780-2249 a (626) 266-2171
John R. Biafone
565 West Lambert Road, Suite C
Brea, California 92821-3901
Re: Duties to Citv of Temole City Under Aoreement Guaranty
Dear Mr. Biafone
I am writing to you in your capacity as the guarantor under the above -referenced guaranty
agreement ("Guaranty") dated July 31, 2003 and pursuant to which you personally guaranteed
the prompt payment of all sums due under that certain Loan and Security Agreement
("Agreement") dated August 11, 2003 and entered Into between the City of Temple City and
Calabee's Inc.
Calabee's has failed since April 2013 to make Its monthly payments due under the Agreement
and the associated Promissory Note and is now four (4) payments behind the agreed-upon
schedule. Pursuant to a letter sent to Calabee's on July 31, 2013, the City has declared
Calabee's In default and has agreed to work cooperatively with Calabee's to resolve the default
if possible. Such resolution may alter, compromise, extend or otherwise change the timing and
terms of payment under the Agreement, to which you consented via Section 3 of the Guaranty.
Please allow this letter to serve as notice that a default has been declared, that the City Is
attempting to resolve the default with Calabee's, and that should resolution be unachievable, the
City will look to you as guarantor for any amounts owed,
Please feel free to contact me at (626) 285-2171 if you have any questions or wish to discuss
this matter,
Very truly yours,
Jose E. Pulido
City Manager
LA H4829-6165-9157 v I
ATTACHMENT E
9701 LAS TUNAS DRIVE • TEMPLE GRy • GALIPORNIA 91780-2248 • (628)2&5-2171
November 20, 2013
Calabee's Inc.
Attn: John R. Bifone, President/CEO
565 W. Lambert Rd., Suite C
Brea, CA 92821-3901
RE: Default on Loan and Security Agreement with City of Temple City
Dear Mr. Bifone;
In follow-up to our July 31, 2013 correspondence regarding Calabee's loan default, we
have not received any of the amount In arrears to date,
We understand that your restaurant (dba Applebee's at 5701 Rosemead Blvd.) is
enduring financial difficulty. Without.waiving Calabee's existing default and without
waiving any rights or remedies the City may have under the loan or California law, we
are proposing an alternative for resolving the default, In short, we would combine the
existing loan balance and accrued interest into a new restructured loan- as -part ofa-
Business Retention and Operating Agreement ("Agreement'). The following deal points
provide the basis for further discussion.
Actions Calabee's would take:
1. Resolve anv default .ofd Calabee's ground lease with the landlord. This entails
providing the City written proof by the landlord that all lease payments are current.
We also ask that a copy of the ground lease be provided to the City Attorney for
confidential review.
2. Negotiate a new ground lease with the landlord. Terms of this new lease should be
in line with duration of the proposed Agreement, and which continues ongoing
restaurant operations,
3. Make certain phvsical ,improvements to the Applebee's restaurant space. These
improvements will be agreed upon_ between Calabee's and the City, and
November 20, 2013
Calabee's Inc.
Page 2 of 3
memorialized in the Agreement, The City proposes the phasing of improvements to
minimize financial impact and business disruption.
4. free to_certain operating provisions that support the restaurant's viability_. This
includes consultant services for efficiency and customer service staff trainings,
implementation of a marketing program, and agreement on a set number of full-time
equivalent employees required for adequate operations.
5, Prepare and provide an operating proforma and business plan. Components should
accomplish aforementioned Items 1 through 4, incorporate other practices to
increase annual gross revenues by 5% per year, and demonstrate ability to repay
per terms outlined in the Agreement.
Actions City would take:
6. Enter into the Agreement with Calabee's. Replacing the existing contract, the
Agreement would incorporate referenced Items 1 through 5 and waive Calabee's
existing loan default.
7. Provide Calabee's with financial assistance and a payment holiday. As part of the
Agreement, some funds would be provided to Calabee's to support phased
improvements (per Item 3). This assistance would be combined with the unpaid
balance of the existing loan and security agreement with a new amortization
schedule to provide a more affordable payment plan. The City would also defer any
payments to the existing agreement until July 1, 2014, however interest would still
accrue and be capitalized on the loan balance,
I trust these deal points provide a more attractive alternative to your financial difficulties.
We look forward to meeting with you to discuss our proposal at your earliest
convenience.
Sincerely,
Jose E. Pulido
City Manager
C: Eric S. Vail, City Attorney (email)
Tracey L. Hause, Administrative Services Director (email)