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Home My WebLink About9/15/1999 - STAFF REPORTS (29) DATE: September 15, 1999 TO: City Council FROM: Director of Aviation ASSIGNMENT OF LEASE AND CONSENT RECOMMENDATION: That the City Council approve an Assignment of Lease and Consent between the City of Palm Springs ("City'), AMR Combs, Inc. ("Lessee) and Signature Flight Support Corporation ("Signature)and Signature Flight Support- California,Inc. ("Assignee'). BACKGROUND: The attached Assignment of Lease and Consent was prepared by the City Attorney's office in coordination with staff and the referenced parties. The Assignment incorporates: a guarantee that the Assignee will assume all obligations of the Lease;that the City's consent of the Assignment is subject to the purchase of improvements and other related requirements of the Lease in connection withthe transactions contemplated bythe Purchase Agreement and is being transferred and assigned pursuant to the terms of the Purchase Agreement; and that the consent, including the assignment shall terminate if any term of the Lease and the Stipulation and Order ("Order') is violated in carrying out the transactions contemplated in the Purchase Agreement. The Consent is subject to approval by both the City and the Department ofJustice("DOJ')pursuant to the terms of the Order. The City Attorney's office and staff have conferenced with the DOJ and they are taking an assertive and involved approach to the compliance and enforcement of the Order. This proposed Assignment and Consent is the first step in a two-step process which will include another proposed Assignment/Consent by the new proposed owner of the Signature leasehold. At its August 25, 1999 meeting the Airport Commission unanimously approved the Assignment of Lease and Consent subject to City Attorney review of Stock Purchase Agreement between AMR Combs and Signature Flight Support before the City signs the consent. The City Attorney's office has since reviewed the Stock Purchase Agreement between AMR Combs and Signature Flight Support, and is in the process of obtaining the name of the person who is authorized to sign the appropriate documents for AMR Combs' asset transaction. ��1149 APPROVED: JERJVL. (RIDDLE T,A. A.E. Director of Aviation Assistant Casty Manager- ions APPROVED: Attachment: 1. Minute Order ell � 2. Assignment of Lease and Consent1 ' / Aur28-00 10:40>10 Fron-RUTAR A TUCKER CM. 7146460036 T-403 P 011143 t-wlb ASSIGNMENT OF LEASE AND CONSENT a7 �r This Assignment of Leases Agreement and Consent(the 'Consent") is trade and entered into as of the day of , 19—, between the CITY OF PALM SPRINGS, whose principal place of business is 3200 East Tahquitz Canyon Way, Palm Springs, California ("City"), AMR COMBS, Inc., a California Corporation ("Lessee") SIGNATURE FLIGHT SUPPORT CORPORATION, a Delaware corporation("Signamre")and SIGNATURE FLIGHT SUPPORT-CALIFORNIA, INC , a California corporation and wholly-owned subsidiary of Signature ("Assignee") with reference to the following facts and purposes: RECITALS A. City and Lessee are parties to that certain Lease Agreement dated December 11. 1996, including any extensions, renewals or permitted modifications thereof (collectively the "Lease") covering a portion of those certain premises known as Palm Springs Regional Airport as more particularly described as Exhibit A attached hereto and incorporated herein by reference (the "Ptcmises"). B. Pursuant to the lease, Lessee owns the airport facility improvements that are a part of the Premises during the term of the Leases (the "Improvements"). C. Pursuant to The terms of an Stock Purchase Agreement dated December 14, 1999 attached hereto as Exhibit A and incorporated herein by reference (the "Purchase Agreement"), Assignee desires to purchase substantially all of the assets relating to the business operation conducted by Lessee on the Premises, including all of Lessee's rights and privileges under the Lease which is being transferred and assigned by Lessee to Assignee pursuant to the terms of The Purchase Agreement (the "Assignment'). D. Pursuant to the terms of the Purchase Agreement, Assignee has guaranteed all of The obligations of Assignee set forth in die Lease. E. Lessee and Assignee desire to obtain the City's specific consent to (1) the Assignment, (0)the purchase of the Improvements and(iii)all other matters relating thereto that may be required under the [ease in connection with the transactions contemplated by the Purchase Agreement, F. The patties acknowledge that the transfer of assets to Assignee under the Purchase Agreement shall be temporary until Assignee transfers the assets thereunder to an entity subject to the consent of the City and the United States Department of 7usnce, pursuant to Elie terms of the Lease and the Stipulation and Order in the action entitled Unima States of America v. Signature Flight SuMert Cote AMR Comb,Inc et al., filed on or about March 1, 1999 in the United States District Court for the District of Columbia, Civil Action No. 990537 ("Order"), respectively. 671N14W 41t"I34By)391 aI1B/2LY9 A- A,u-23-00 10:40a Fro -MM 4 now, T145409035 • 7-403 P 00/I3 F-015 NOW, THEREFORE, in consideration of the premises, the mutual promises of the parties hereto and for other good and valuable consideration, The receipt and sufficiency of which is hereby acknowledged, City, Lessee, Assignee and Signature agree as follows: 1. &greseniations. City and Lessee represent and certify the following: a. That the Lease is in full force and effect and has not been modified, changed, altered or amended is say respect. b. That the Lease is the only agreement between the City and the Lessee affecting the Premises. C. That to City's knowledge, Lessee is current in the payment of any and all rent and any charges required to be paid by Lessee under the Lease to die City's knowledge, no default presently exists under the Lease and no state of facts exist which would constitute a default under dre Lease 2. Consent and Related Agreements. a. Assignee acknowledges that it has received a copy of the Lease and is fully familiar with its terms. b. Upon the effective date of the Assignment, Assignee shall assume all obligations of Lessee under the Lease and shall perform all duties and obligations required to be performed under the Lease. C. lessee hereby guaraarees all obligations of Assignee under the Lease and shall be responsible for The performance of all duties and obligations of Lessee whatsoever thereunder and which guarantee shall continue for the entire term of the Lease. City shall not be bound to exhaust its recourse against Assignee or any other person or entities or resort to any other means of obtaining payment or performance before being entitled to payment from Lessee of the amount hereby guatrsnleed. d. Effective as of the closing Date referenced in the Purchase Agreemem (the "Closing Date" being the date on which transactions contemplated by die Purchase Agreement, including the Assignment, are consummated), City hereby consents to the (i) Assignment of the Lease to Assignee, subject to the guarantee of Assignee(ii) the purchase of the Improvements and (iii) all other matters relating thereto that may be required under the Lease in connection with the transactions contemplated by the purchase Agreement. e. Such consent shall terminate if the transactions contemplated by the Purchase Agreement, including the Assignment, shall violate arty term of the Order or Lease.. 6t7Al�OMA0NrS2YT1)91 a9ll23A➢ -2- �� ' ) MINUTE ORDER NO. a1 � APPROVE AN ASSIGNMENT OF LEASE AND CONSENT BETWEEN THE CITY OF PALM SPRINGS("CITY"),AMR COMBS, INC.(°LESSEE") AND SIGNATURE FLIGHT SUPPORT CORPORATION(°SIGNATURE°)AND SIGNATURE FLIGHT SUPPORT - CALIFORNIA, INC. ("ASSIGNEE"). -------------------- I HEREBY CERTIFY that this Minute Order approving an Assignment of Lease and Consent between the City of Palm Springs ("City"), AMR Combs, Inc. ("Lessee") and Signature Flight Support Corporation('Signature")and Signature Flight Support - Inc. ("Assignee'), was adopted by City Council of the City of Palm Springs, Califomia in a meeting thereof held on the 15th day of September, 1999. PATRICIA A. SANDERS Acting City Clerk