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FURRA, RALPH RESOLUTION NO CRA 92-10-6-1 DEPOSIT AND INVESTMENT OF AGENCY FUNDS - A RESOLUTION OF THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, DELEGATING TO THE AGENCY FINANCE OFFICER AUTHORITY TO DEPOSIT AGENCY FUNDS AND TO INVEST AND REINVEST AGENCY FUNDS, AND REPEALING RESOLUTION NO. CRA 91-12-3-2 The motion carried by the following vote: AYES: Directors Harris, Hausdorfer, Jones, Vasquez, and Chairman Friess NOES: None ABSENT: None The Resolution authorizes the signatures of the Chairman or Vice Chairman; and, the Executive Director, or Agency Secretary, or Agency Finance Officer. 4. RATIFICATION OF TERMINATION OF STEPHEN B JULIAN (75010) Written Communications: Report dated October 6, 1992,from the City Attorney, advising that the requested action was necessary to satisfy any technicalities which may arise from operation of Municipal Code Section 2-5.212. Ratification of Action: It was moved by Director Hausdorfer, seconded by Director Jones, and unanimously carried that the Board concur with the Resolution of the City Council ratifying the termination of Stephen B. Julian effective October 15, 1992. --� 5. RESOLUTION APPROVING CANCELLATION OF DISPOSITION AND DEVELOPMENT AGREEMENT FOR THE PROPERTY LOCATED AT 31782-86 CAMINO CAPISTRANO (SWALLOW INN/FURRA Written Communication: Report dated October 6, 1992, from Julia M. Kimminau, Management Assistant, recommending that the Disposition and Development Agreement between the City and Ralph A. Furra for the purchase of the Swallows Inn property be canceled at the request of Mr.Furra and that the Good Faith Deposit in the amount of$50,000 be returned. Mr.Furra was unable to reach an agreement with Ms.Tacy Lee because of her difficulty in securing her partner's approval of the proposed sale. Resolution Canceb& the DisUgsition and Development Agreement with Ralph A. Furra: It was moved by Director Harris, seconded by Director Hausdorfer, that the following Resolution be adopted: -2- 10/6/92 i • RESOLUTION NO CRA 92-10-6-2 APPROVING CANCELLATION OF DISPOSITION AND DEVELOPMENT AGREEMENT FOR THE SALE OF PROPERTY LOCATED AT 31782-31786 CAMINO CAPISTRANO TO RALPH A FURRA - A RESOLUTION OF THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, CITY OF SAN JUAN CAPISTRANO, CALIFORNIA, APPROVING THE CANCELLATION OF THE DISPOSITION AND DEVELOPMENT AGREEMENT FOR CERTAIN PROPERTY WITHIN THE SAN JUAN CAPISTRANO CENTRAL REDEVELOPMENT PROJECT AREA TO RALPH A. FURRA The motion carried by the following vote: AYES: Directors Harris, Hausdorfer, Jones, Vasquez, and Chairman Friess NOES: None ABSENT: None CLOSED SESSION The Board recessed to the Council meeting at 7:52 p.m. and reconvened in Closed Session at 8:20 p.m. for discussion of real property negotiations per Government Code Section 54956.8 (AP 124160-021/Furca; 26832 Ortega Highway/Darnold; AP 121-240-20 and AP 121-240-39/Yorba, Harrison), the Agency Secretary being excused therefrom, and reconvened at 9:08 p.m. ADJOURNMENC There being no further business before the Board, the meeting was adjourned at 9:08 p.m. to the next regular meeting date of Tuesday, October 20, 1992, at 7:00 p.m. in the City Council Chamber. Respectfully submitted, CHERYL JOHNSON, AGENCY SECRETARY ATTEST: KENNETH E. FRIESS, CHAIRMAN -3- 10/6/92 AGENDA ITEM October 6, 1992 TO: George Scarborough, Executive Director FROM: Julia M. Kimminau, Management Assistant SUBJECT: Cancellation of Disposition and Development Agreement for the property located at 31782-86 Camino Capistrano (Ralph A. Furra) RECOMMENDATION: By motion, adopt the resolution, and approve the cancellation of the Disposition and Development Agreement with Ralph A. Furra, and authorize the Executive Director, on behalf of the Community Redevelopment Agency,to cancel escrow and to return Mr.Furra's $50,000 Good Faith Deposit and any earned accrued interest per Section II.A.[201]3. SITUATION. A. Summary and Recommendation - On August 18, 1992, the Agency Board of Directors adopted a resolution and executed the Disposition and Development Agreement with Ralph A. Furra for the property located at 31782-86 Camino Capistrano. The property houses two businesses, the Swallows Inn and the Paisley Penguin. On September 10, 1992, escrow was opened on the property, and on September 14, 1992, in accordance with the terms of the agreement, Ralph A. Furra delivered to the Agency a $50,000 Good Faith Deposit. On September 16, 1992, the Community Redevelopment Agency was notified through a letter by Mr. Furra's attorney (Attachment 1) that the acquisition of the Swallows Inn from Ms. Tacy Lee could not be accomplished and requested that the Good Faith Deposit be returned to Ralph Furra. In subsequent communications with Ralph Furra, it became apparent that he had negotiated with the Agency and Ms. Lee in good faith and had made an industrious effort to acquire the Swallows Inn, but was unable to reach an agreement with Ms. Lee due to circumstances associated with Ms. Lee's difficulty in securing her partner's approval of the proposed sale. Pursuant to Section I.P.[2181 of the Disposition and Development Agreement, Ralph Furra's obligation to complete and purchase the property is subject and contingent to his acquisition of the Swallows Inn operation and name. Since he has been unable to acquire the business, Mr. Furra cannot meet one of the conditions precedent to closing and has, therefore, requested that the Disposition and Development Agreement be canceled and that his Good Faith Deposit be returned. Staff recommends that the Agency Board of Directors adopt the resolution, attached herein, and cancel the Disposition and Development Agreement with Ralph A.Furra,cancel escrow and return to Mr. Furra the $50,000 Good Faith Deposit. FOR CITY COUNCIL AGEIS��i �I`'� Agenda Item -2- October 6, 1992] PUBLIC NOTIFICATION: A copy of this agenda item has been furnished to Ralph A. Furra, Tacy Lee, Proctor Stafford and Jeffrey Hartman. OTHER BOARDS AND COMMISSIONS: Not Applicable FINANCIAL CONSIDERATION: Return the $50,000 Good Faith Deposit. No escrow fees have been assessed to the Agency. ALTERNATIVES: 1. Adopt the resolution and approve the cancellation of the Disposition and Development Agreement with Ralph A. Furra, and authorize the Executive Director, on behalf of the Community Redevelopment Agency, to cancel escrow and to return Mr. Furra's $50,000 Good Faith Deposit and any earned accrued interest per Section II.A.[201]3. 2. Request further information from staff. RECOMMENDATION• By motion, adopt the resolution and approve the cancellation of the Disposition and Development Agreement with Ralph A. Furra, and authorize the Executive Director, on behalf of the Community Redevelopment Agency,to cancel escrow and to return Mr.Furra's $50,000 Good Faith Deposit and any earned accrued interest per Section II.A.[201]3. Respectfully submitted, 'a M �m�->irlau Julia . Kimmmau nagement Assistant JMK attach RESOLUTION NO. CRA 92-10-6-2 APPROVINGCANCELLATION OF DISPOSITION AND DEVELOPMENT AGREEMENT FOR THE SALE OF PROPERTY LOCATED AT 31782-31786 CAMINO CAPISTRANO TO RALPH A. FU RA A RESOLUTION OF THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, APPROVING THE CANCELLATION OF THE DISPOSITION AND DEVELOPMENT AGREEMENT FOR CERTAIN PROPERTY WITHIN THE SAN JUAN CAPISTRANO CENTRAL REDEVELOPMENT PROJECT AREA TO RALPH A. FURRA WHEREAS, the Community Redevelopment Agency of the City of San Juan Capistrano (the "Agency"), is engaged in activities necessary to carry out and implement the Redevelopment Plan for the San Juan Capistrano Central Redevelopment Project Area; and, WHEREAS, the Agency entered into a Disposition and Development Agreement (the "Agreement"), with Ralph A. Furra (the "Developer") for the sale of the premises (the "Premises") in the San Juan Capistrano Central Redevelopment Project Area, described in the Agreement as approximately 17,133 square feet commonly known as the Swallows Inn and Paisley Penguin with a mailing address of 3L782-3L786 Camino Capistrano; and, WHEREAS, the Developer was unable to purchase the Swallows Inn business and name as a precedent to closing and has submitted to the Agency a written request to have the Disposition and Development Agreement cancelled. NOW, THEREFORE, BE IT RESOLVED, by the San Juan Capistrano Community Redevelopment Agency, City of San Juan Capistrano, California, as follows: 1. The Disposition and Development Agreement with Ralph A. Furra is hereby cancelled. 2. The Executive Director of the Agency (or his designee) is hereby authorized on behalf of the Agency, to administer the Agency's obligations, responsibilities and -duties to be performed to cancel the agreement. PASSED, APPROVED, AND ADOPTED this 6th day Of notnher , 1992. ( �KENNETH E. FRI SS, CHAIRMAN ATTEST: AGENCY E E A Y -1- STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss CITY OF SAN JUAN CAPISTRANO ) 1, CHERYL JOHNSON, Secretary of the San Juan Capistrano Community Redevelopment Agency, DO HEREBY CERTIFY that the foregoing is a true and correct copy of Resolution No. CRA 92-10-6-2 adopted by the Board of Directors of the San Juan Capistrano Community Redevelopment Agency, at a regular meeting thereof held on the 6th day of October , 1992, by the following vote: AYES: Directors Hausdorfer, Jones, Harris, Vasquez, and Chairman Friess NOES: None ABSTAIN: None ABSENT: None (SEAL) _ CHERYL JOHNSO ,�AZENCY SECR -Y- -2- JEFFREY A. HARTMAN A Professional Law Corporation Telephone (714)644-1002 567 Sen Nicolas,Suite 308 Fax Cn4)721-1316 Newport Beach,CA 92660 September 16, 1992 Community Redevelopment Agency of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 ATTN: Kenneth E. Friess, Chairman RE: Termination of Disposition and Development Agreement by and between the San Juan Capistrano Community Redevelopment Agency and Ralph Furra Dear Mr. Friess: This office has been representing Ralph Furra in his attempt to acquire the Swallows Bar in the building located at 31786 Camino Capistrano, which is the subject of the above described agreement. I have been worldng with Mr. Ralph Furra and Mrs. Tacy Lee to accomplish the transaction described in the Agreement. Due to several reasons, the acquisition of the Swallows Bar cannot be accomplished. We would appreciate it if you would send the Good Faith deposit to my clients office, which is located at 2318 Newport Blvd., Newport Beach, CA 92663. Thank you in advance for your cooperation on this matter. Very truly your,9 JAH:db cc: Ralph Furra Tacy Lee ATTACHMENT 1 JEFFREY A. HARTMAN A Professional Law Corporation Telephone (714)6442002 567 San Nicolas,Suite 308 Fax (714)721-8316 Newport Beach, CA 92660 September 30, 1992 Community Redevelopment Agency of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 ATTN: Kenneth E. Friess, Chairman RE: Termination of Disposition and Development Agreement by and between the San Juan Capistrano Community Redevelopment Agency and Ralph Furra Dear Mr. Friess: This letter is in response to your request that my client provide the City Redevelopment} Agency the reasons why the acquisition of the Swallows Bar cannot occur. My client, Ralph Furra, has used his best efforts to acquire the business known as the Swallows Inn for the past five months. His accepted offer to purchase, however, cannot reach a successful conclusion due to factors that could not be anticipated when negotiations began. These are: 1. Sharon Thatcher, a shareholder in the Corporation that owns the Swallows Inn, has not, through her attorney, consented to the sale. There are ongoing problems between Tacy Lee and Sharon Thatcher that to date have not been resolved. 2. The financial condition of the business has deteriorated to the point that monthly losses are occurring and continued viability of the business known as the "Swallows Inn" is questionable in light of the value placed on the building. 3. Because of numerous lawsuits that include assault and battery, procuring insurance at reasonable rates, without several exclusions, is very difficult to obtain. X U C N1 Community Redevelopment Agency September 30, 1992 Page two Pursuant to paragraph 218 of the Development Agreement between Ralph Furra and the Community Redevelopment Agency of the City of San Juan Capistrano, please return my clients deposit of Fifty Thousand ($50,000) dollars. Thank you in advance for your cooperation on this matter. Very truly yours,,. Jeffrey A. artman JAH:db DISPOSITION AND DEVELOPMENT AGREEMENT by and between the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, Agency, and RALPH FURRA Developer. August 5, 1992 TABLE OF CONTENTS I . [51001 SUBJECT OF AGREEMENT . . . . . . . . . . . . . . . . . 1 A. [51011 Purpose of the Agreement . . . . . . . . 1 B. [§102] The Redevelopment Plan . . . . . . . . . . 1 C. [§103] The Redevelopment Project Area . . 1 D. [51041 The Property . . . . . . . . . . . . . . . . . . . . 1 E. [§105] Parties to the Agreement . . . . . . . . 2 1 . [§106] The Agency . . . . . . . . . . . . . . . . . 2 2. [ §1071 The Developer . . . . . . . . . . . . 2 F. [§1081 Prohibition Against Change in Ownership, Management and Control of Developer . . . . . . . . 2 II . [52001 DISPOSITION OF THE PROPERTY . . . . . . . . . . 3 A. [52011 Sale and Purchase of the Property . . . . . . . . . . . . . . . . . . . . . . . . 3 B. [52021 Escrow . . . . . . . . . . . . . . . . . . . . . . . . . . 4 C. [§2031 Conveyance of Title and Delivery of Possession . . . . . . . . . . 7 D. [§2041 Form of Grant Deed . . . . . . . . . . . . . . 8 E. [§2051 Condition of Title . . . . . . . . . . . . . . 8 F. [§2061 Time for and Place of Delivery of Grant Deed . . . . . . . . . . . . . . 8 G. I §2071 Payment of the Purchase Price and Recordation of the Grant Deed . . . 8 H. [ 52081 Title Insurance . . . . . . . . . . . . . . . . . 9 I . [§2091 Taxes and Assessments . . . . . . . . . . . 9 J. [52101 Occupants of the Property . . . . . . . 9 R. [52111 Zoning of the Property . . . . . . . . . . 10 L. [52121 Condition of the Property . . . . . . . 10 1 . [§2131 Suitability of the Property . . 10 2 . [ §2141 "As Is" Conveyance . . . . . . . . . . . 11 M. [§2151 Access to and Entry by the Developer upon the Property . . . . . 12 N. [§2161 Representations and Warranties ofAgency . . . . . . . . . . . . . . . . . . . . . . . 12 O. [§2171 Representations and Warranties of Developer . . . . . . . . . . . . . . 13 P. [52181 Developer ' s Conditions Precedent to Closing . . . . . . . . . . . . . . . . . . . . . . 14 III . [53001 DEVELOPMENT OF THE PROPERTY . . . . . . . . . . 15 A. [§3011 Scope of Development . . . . . . . . . . . . 15 B. [§3021 Cost of Construction 15 (i) C. [ §3033 City and Other Governmental Agency Permits . . . . . . . . . . . . . . . . . . 15 D. [ §3043 Rights of Access . . . . . . . . . . . . . . . . 15 E. [§3053 Local , State and Federal Laws . . . 15 F. [53063 Nondiscrimination During Construction . . . . . . . . . . . . . . . . . . . . 15 G. [ 53073 Certificate of Completion . . . . . . . 16 IV. [§4003 USE OF THE PROPERTY . . . . . . . . . . . . . . . . . . 16 A. [ §4013 Uses . . . . . . . . . . . . . . . . . . . 16 B. [§4023 Obligation to Refrain from Discrimination . . . . . . . . . . . . . . . . . . 17 C. [§4033 Form of Nondiscrimination and Nonsegregation Clauses . . . . . . . . . . 17 D. [ §4043 Effect and Duration of Covenants . . . . . . . . . . . . . . . . . . . . . . . 19 V. [§500] DEFAULTS, REMEDIES AND TERMINATION . . . 19 A. [ 55013 Defaults - General . . . . . . . . . . . . . . 19 B. [§5023 Legal Actions . ... . . . . . . . . . . . . . . 19 1 . [ §5033 Institution of Legal Actions 19 2 . [ §5043 Applicable Law . . . . . . . . . 20 3 . [§505] Acceptance of Service of Process . . . . . . . . . . . . . . . . . . . . 20 C. [ §5063 Rights and Remedies are Cumulative . . . . . . . . . . . . . . . . . . . . . . 20 D. [ §5073 Damages . . . . . . . . . . . . . . . . . . . . . . . . . 20 E. ( 55083 Specific Performance . . . . . . . . . . . . 20 F. [ 55093 Remedies and Rights of Termination . . . . . . . . . . . . . . 21 1 . (55103 Termination of Developer . . . 21 2 . [ §5113 Termination by Agency . . . . . . 21 G. [ 55123 Rights and Remedies Subsequent to the Issuance of a Certificate of 23 Completion . . . . . . . . . . . . . . . . . . . . . . VI . [5600] GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . 23 A. [ §6013 Notices, Demands and Communications Between the Parties . . . . . . . . . . . . . . . . . . . . . . . . . 23 ( ii) 0 0 B. (§602] Conflicts of Interest . . . . . . . . . . . 23 C. (§6031 Warranty against Payment of Consideration for Agreement . . . . . 24 D. ( §6041 Nonliability of Agency Officials and Employees . . . . . . . . . 24 E. [56051 Enforced Delay: Extension of Times of Performance . . . . . . . . . . . . 24 F. [56061 Approval by the Agency and the Developer . . . . . . . . . . . . . . . . . . . 24 G. [ 56071 Plans and Data . . . . . . . . . . . . . . . . . . 25 VII . (57001 ENTIRE AGREEMENT, WAIVERS AND AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 VIII . [§8001 TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 ATTACHMENTS Attachment No. 1 Property Map Attachment No. 2 Legal Description Attachment No. 3 Scope of Development Attachment No . 4 Grant Deed Attachment No. 5 Seller ' s Disclosure Statement Attachment No . 6 Cooperative Parking Agreement Attachment No. 7 Tenant ' s Certificate (iii) DISPOSITION AND DEVELOPMENT AGREEMENT THIS AGREEMENT is entered into by and between the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, a public body, corporate and politic ( "Agency" ) , and RALPH FURRA, an individual, ( "Developer" ) . The Agency and the Developer agree as follows : I . [ §100] SUBJECT OF AGREEMENT A. [5101] Purpose of the Agreement 1 . The purpose of this Agreement is to effectuate the Redevelopment Plan for the Central Redevelopment Project (the "Redevelopment Project" ) by providing for the disposition and development of property owned by the Agency within the Redevelopment Project area . The disposition of the Property by the Agency is authorized by Article 11, Sections 33430 et seg. of the California Health and Safety Code and is in the vital and best interest of the City of San Juan Capistrano and the health, safety, and welfare of its residents, necessary for purposes of redevelopment within the Project Area, and in accord with the public purposes and provisions of applicable federal, state, and local laws and requirements . B. [ § 1021 The Redevelopment Plan This Agreement is subject to the provisions of the Redevelopment Plan for the Redevelopment Project, which was approved and adopted by the City Council of the City of San Juan Capistrano by Ordinance No. 408, and amended by Ordinance Nos . 509, 547 and 582; said ordinances and the Redevelopment Plan (the "Redevelopment Plan" ) are incorporated herein by reference and made a part hereof as though fully set forth herein. C. [ § 1031 The Redevelopment Project Area The San Juan Capistrano Project Area (the "Project Area" ) is located in the City of San Juan Capistrano, California, (the "City" ) . The exact boundaries of the Project Area are specifically and legally described in the Redevelopment Plan. D. [§ 1041 The Property The Agency holds fee title to certain real property in the City (Assessor Parcel #124-160-21 ) located at 31786 Camino Capistrano (the "Property" ) . The Property is in the Project Area and is shown on the "Property Map" attached hereto as i Attachment No. 1 and described in the "Legal Description of the Property" attached hereto as Attachment No. 2, both Attachments incorporated herein by reference. The Property encompasses approximately 15,320 square feet and includes an existing two-unit retail building of approximately 3, 600 square feet. E. IS 1051 Parties to the Agreement 1. IS 1061 The Agency The Agency is a public body, corporate and politic, exercising governmental functions and powers, and organized and existing under Chapter 2 of the Community Redevelopment Law of the State of California. The principal office of the Agency is located at 32400 Paseo Adelanto, San Juan Capistrano, California, 92675, Attention: Executive Director. "Agency" as used in this Agreement includes the San Juan Capistrano Community Redevelopment Agency and any assignee of or successor to its rights, powers and responsibilities . 2 . IS 1071 The Developer The Developer is an individual . The principal office of the Developer for purposes of this Agreement is located at 2318 Newport Boulevard, Newport Beach, California, 92663 . Wherever the term "Developer" is used herein, such term shall include any permitted nominee, assignee or successor in interest as herein provided. F. [§108] Prohibition against Change in Ownership, Management and Control of Developer The Developer represents and agrees that his purchase of the Property and his other undertakings pursuant to this Agreement are, and will be used, for the purpose of redevelopment of the Property and not for speculation in land holding. The Developer further recognizes that, in view of : (a) the importance of the redevelopment of the Property to the general welfare of the community; (b) the public aids that have been made available by law and by the government for the purpose of making such redevelopment possible; and 08/05/92 1661Q/2299/00 - 2 - (c) the fact that a change in ownership or control of the Developer or of a substantial part thereof, or any other act or transaction involving or resulting in a significant change in ownership or control of the Developer or the degree thereof, is for practical purposes a transfer or disposition of the property then owned by the Developer, the qualifications and identity of the Developer are of particular concern to the community and the Agency. The Developer further recognizes that it is because of such qualifications and identity that the Agency is entering into this Agreement with the Developer . No voluntary or involuntary successor in interest of the Developer shall acquire any rights or powers under this Agreement except as expressly set forth herein, and the Developer shall not assign all or any part of this Agreement without the prior written approval of the Agency. The restrictions of this Section 108 shall terminate upon issuance by the Agency of a Certificate of Completion for the Property as described in Section 307 of this Agreement. I1 . [5200] DISPOSITION OF THE PROPERTY A. [5201] Sale and Purchase of the Property 1 . Purchase and Sale In accordance with and subject to all the terms, covenants and conditions of this Agreement, the Agency agrees to sell the Property to the Developer and the Developer agrees to purchase the Property from the Agency. 2 . Purchase Price The Purchase Price payable for the Property and the terms of the purchase by the Developer shall be Five Hundred Thousand Dollars ($500, 000 . 00) cash (the "Purchase Price" ) . 3 . Developer Good Faith Deposit; Liquidated Damages Within forty-eight (48) hours of the opening of escrow by the Agency as provided in Section 202 of this Agreement, the Developer shall deliver to the Agency cash or a cashier ' s or certified check in the amount of Fifty Thousand Dollars ($50, 000 . 00) . The above described funds delivered to the Agency are herein called the "Good Faith Deposit . " 08/05/92 1661Q/2299/00 - 3 - • 0 Upon the Developer ' s delivery of the Good Faith Deposit to the Agency, the Agency shall deposit the Good Faith Deposit in a federally insured financial institution and the parties agree that the interest rate on such deposit shall be the prevailing rate paid by financial institutions for regular short term passbook accounts . Upon the occurrence of the termination of this Agreement pursuant to Section 510(a) hereof, the Good Faith Deposit shall be promptly returned to the Developer. Upon the termination of this Agreement pursuant to Section 511 hereof, the Good Faith Deposit shall be retained by the Agency as liquidated damages, as further provided in Section 511 hereof . Regardless of whether the Good Faith Deposit is retained by the Agency as either liquidated damages or as a portion of the Purchase Price, or is returned to the Developer pursuant to Section 510(a) of this Agreement, the parties agree that all interest accrued on the Good Faith Deposit while on deposit shall be paid to the Developer. B. [§202] Escrow The Agency agrees to open an escrow for conveyance of the Property with First American Title insurance Company, or such other escrow agent as may be agreed upon by the parties (the "Escrow Agent") , not later than ninety (90) days after the execution of this Agreement by the Agency. Sections 104 through 107 and 200 through 209, inclusive, and Section 218 of this Agreement shall constitute the joint escrow instructions of the Agency and the Developer with respect to the sale and purchase of the Property, and a duplicate original of this Agreement shall be delivered to the Escrow Agent upon the opening of escrow. The Agency and the Developer shall provide such additional escrow instructions as shall be necessary and consistent with this Agreement. The Escrow Agent is hereby empowered to act under this Agreement and upon indicating its acceptance of the applicable provisions of this Agreement in writing, delivered to the Agency and to the Developer within five (5) days after opening of the escrow, shall carry out its duties as Escrow Agent hereunder . The Agency shall timely and properly execute, acknowledge and deliver a Grant Deed for the conveyance of title to the Property (or other transferring document) in substantially the form established in Section 204 of this Agreement and attached hereto as Attachment No. 4 and incorporated herein by reference. Upon delivery to the Escrow Agent by the Agency of the Grant Deed (Attachment No. 4) for the Property pursuant to Section 206 of this Agreement, the Escrow Agent shall record such deed when title thereto can be vested in the Developer in accordance with the terms and provisions of this Agreement . 08/05/92 1661Q/2299/00 - 4 - The Escrow Agent shall buy, affix, and cancel any transfer stamps required by applicable law, and pay any transfer tax required by law. Any insurance policies governing the Property are not to be transferred. The Developer shall pay in escrow to the Escrow Agent the following fees, charges and costs promptly after the Escrow Agent has notified the Developer of the amount of such fees, charges, and costs, but not earlier than ten (10) days prior to the scheduled date for the conveyance of the Property: 1 . One-half of the escrow fee; 2. The portion of the premium for the title insurance policies to be paid by the Developer as set forth in Section 208 of this Agreement; The Developer shall deposit the Purchase Price for the Property (less the Good Faith Deposit) and any other amounts required by the provisions of this Agreement with the Escrow Agent in accordance with the provisions of Section 207 of this Agreement. The Escrow Agent shall charge the following fees, charges, and costs to the Agency and deduct the same from the Purchase Price provided that prior to the close of escrow, the Agency has approved a pro forma closing statement setting forth the amount of such fees, charges and costs : 1 . Costs necessary to place title to the Property in the condition required by the provisions of this Agreement; 2. One-half of the escrow fee; 3 . Cost of drawing the deed; 4 . Recording fees; 5 . Notary fees; 6 . The portion of the premium for the title insurance policy to be paid by the Agency as set forth in Section 208 of this Agreement; 7. Ad valorem taxes, if any, upon the Property for any time prior to conveyance of title. 8. Any State, County or City documentary stamps; 9 . Any transfer tax. 08/05/92 16610/2299/00 - 5 - The Agency shall furnish, at its expense, a termite report for the Property within thirty (30) days of the date of this Agreement . If the termite report determines that such work is necessary, the Agency will, at its cost and expense, cause the building upon the Property to be treated by a licensed pest control company for the elimination of termite infestation. The Developer shall be solely responsible for all other necessary or recommended repairs or corrections listed in the termite report. The Escrow Agent is authorized to: 1 . Pay, and charge the Agency and the Developer respectively, for any fees , charges and costs payable under Section 202 of this Agreement . Before such payments are made, the Escrow Agent shall notify the Agency and the Developer of the fees, charges and costs necessary to clear title and close the escrow. 2 . Disburse funds and deliver the Grant Deed (Attachment No . 4) and other documents to the parties entitled thereto when the conditions of this escrow have been fulfilled by the Agency and the Developer . Such funds shall not be disbursed by the Escrow Agent unless and until it has recorded the Grant Deed (Attachment No. 4) to the Property and is prepared to deliver to the Developer a title insurance policy insuring and conforming to the requirements of Section 208 of this Agreement . 3 . Record any instruments delivered through this escrow if necessary or proper to vest title in the Developer in accordance with the terms and provisions of the escrow instructions portion of this Agreement (Sections 104-107 and 200-209, inclusive, and Section 218) . 4 . Report all information required pursuant to Internal Revenue Service Code Section 6045(a) regarding the disposition of the Property by the Agency to the Developer hereunder, and provide copies of all such reports to all parties hereto. All funds received in this escrow shall be deposited by the Escrow Agent in a general escrow account with any state or national bank doing business in the State of California and reasonably approved by the Developer and the Agency, and may be combined in such with other escrow funds of the Escrow Agent . If this escrow is not in condition to close on or before the time for conveyance established in Section 203 of this Agreement, either party who then shall have fully performed the acts to be performed before the conveyance of title may, in writing, demand the return of its money, papers, or documents from the Escrow Agent. No demand for return shall be recognized until ten (10) days after the Escrow Agent (or the 08/05/92 1661Q/2299/00 - 6 - party making such demand) shall have mailed copies of such demand to the other party at the address of its principal place of business. Objections, if any, shall be raised by written notice to the Escrow Agent and to the other party within the 10-day period, in which event the Escrow Agent is authorized to hold all money, papers and documents until instructed by mutual agreement of the parties or, upon failure thereof, by a court of competent jurisdiction. If no such demands are made, the escrow shall be closed as soon as possible. If objections are raised as above provided for , the Escrow Agent shall not be obligated to return any such money, papers or documents except upon the written instructions of both the Agency and the Developer, or until the party entitled thereto has been determined by a final decision of a court of competent jurisdiction. If no such objections are made within said 10-day period, the Escrow Agent shall immediately return the demanded money, papers or documents . Any amendment to these escrow instructions shall be in writing and signed by both the Agency and the Developer . At the time of any amendment, the Escrow Agent shall agree to carry out its duties as Escrow Agent under such amendment . All communications from the Escrow Agent to the Agency or the Developer shall be directed to the addresses and in the manner established in Section 601 of this Agreement for notices, demands, and communications between the Agency and the Developer . The liability of the Escrow Agent under this Agreement is limited to performance of the obligations imposed upon it under Sections 104 through 107 and Sections 200 through 209, inclusive, and Section 218 of this Agreement . The Agency acknowledges that the Developer is a licensed California Real Estate Broker . The Agency shall not be liable for any real estate commissions or brokerage fees which may arise herefrom. The Agency represents that it has engaged no broker, agent, or finder in connection with this transaction, and the Developer agrees to hold the Agency harmless from any claim by any broker, agent or finder retained by the Developer . C. [ 52031 Conveyance of Title and Delivery of Possession Subject to any mutually agreed upon extension of time, conveyance to the Developer of title to the Property in accordance with the provisions of Section 205 of this Agreement shall be concurrent with the Developer ' s acquisition of the "Swallows Inn" business operation and name, or such later date as authorized by the Agency and the Developer and communicated 08/05/92 1661Q/2299/00 - 7 - 0 0 in writing to the Escrow Agent. The Developer shall provide the Escrow Agent with immediate notice of the completion of said acquisition. Possession of the Property shall be delivered to the Developer concurrently with the conveyance of title. The Developer shall accept title to and possession of the Property on or before the date established for conveyance in this Section 203 . D. [§204] Form of Grant Deed The Agency shall convey to the Developer title to the Property in the condition provided in Section 205 of this Agreement by Grant Deed (or other conveyancing instrument) substantially in the form of Attachment No. 4 and consistent with the provisions of Section 205 of this Agreement . The Grant Deed (Attachment No. 4) shall contain covenants necessary or desirable to carry out this Agreement . E. [§205] Condition of Title The Agency shall convey to the Developer fee simple title to the Property free and clear of all liens, encumbrances, assessments, easements, leases and taxes, except for (1) covenants and easements of record at the time of execution of this Agreement which the Developer has approved; (2) the Redevelopment Plan; (3) those tenancies which are set forth in Section 210 of this Agreement; and (4) such other encumbrances to which the Developer may consent and which are otherwise consistent with this Agreement. Notwithstanding any other provision of this Agreement to the contrary, the Agency may obtain possession of part or all of the Property by means of an order of immediate possession from a court exercising eminent domain jurisdiction or similar right . F. [§206] Time for and Place of Delivery of Grant Deed Subject to any mutually agreed upon extension of time, the Agency shall deposit the Grant Deed (Attachment No. 4) for the Property with the Escrow Agent on or before the date established for the conveyance of the Property in Section 203 of this Agreement . G. [§207] Payment of the Purchase Price and Recordation of the Grant Deed The Developer shall promptly deposit the Purchase Price (less the Good Faith Deposit) with the Escrow Agent no later than one (1) day prior to the date for conveyance, provided 08/05/92 1661Q/2299/00 - 8 - that the Escrow Agent shall have notified the Developer in writing that the Grant Deed (Attachment No. 4) , properly executed and acknowledged by the Agency, has been delivered to the Escrow Agent and that title is in the condition to be conveyed in conformity with the provisions of Section 205 of this Agreement. The Escrow Agent shall deliver the Purchase Price (less the Good Faith Deposit) to the Agency in accordance with Section 203 at such time as the Escrow Agent is prepared to deliver to the Developer a title insurance policy in conformity with Section 208 of this Agreement, and shall - promptly file the Grant Deed for recordation among the land records in the Office of the County Recorder for Orange County. H. [§208] Title Insurance Concurrently with recordation of the Grant Deed, First American Title Insurance Company or another insurance company acceptable to the parties (the "Title Insurance Co. " ) shall provide and deliver to the Developer a title insurance policy (which at the Developer ' s option may be an ALTA owner ' s policy) issued by the Title Insurance Co. insuring that title to the Property is vested in the Developer in the condition required by Section 205 of this Agreement . The Title Insurance Co . shall provide the title insurance policy, and the title insurance policy shall be in the amount of the Purchase Price for the Property or in such greater amount as the Developer may specify as hereinafter provided. The Agency shall pay only for that portion of the title insurance premium attributable to a CLTA or ALTA standard form owner ' s policy of title insurance in the amount of the Purchase Price for the Property. The Developer shall pay for all additional premiums, including those for any extended coverage or special endorsements which it requests . I . [§209] Taxes and Assessments All ad valorem taxes and assessments levied or imposed for any period commencing after conveyance of title to or delivery of possession of the Property to the Developer and taxes upon this Agreement or any rights hereunder , shall be borne by the Developer . J. [5210] Occupants of the Property The parties agree that title to the Property shall be conveyed to the Developer subject only to any possession or right of possession of the two current tenants of the Property: (1) Tacy Lee, the owner of the "Swallows Inn" business, and (2) Alan Brown, the owner of the "Paisley Penguin" business . The Developer is presently in the process of acquiring the "Swallows Inn" business operation and name from its current owner and, as provided in Section 203 of this 08/05/92 1661Q/2299/00 - 9 - Agreement, the Developer shall accept title to the Property concurrently with his acquisition of the "Swallows Inn" business operation and name. The Developer shall accept title to the Property subject to the "Paisley Penguin" tenancy; notwithstanding, however, that the Developer reserves the right to make subsequent changes to the terms and/or conditions of that tenancy. The parties acknowledge that neither the current owner of the "Swallows Inn" business nor the "Paisley Penguin" business is an intended third party beneficiary of this Agreement. K. [5211] Zoning of the Property The Property is presently zoned CT (Tourist Commercial) and is subject to the Architectural Design Guidelines . The Developer shall insure that all plans for improvement and/or rehabilitation of the Property conform to said zoning and guidelines . L. [§212] Condition of the Property For the purposes of Section 213 , Section 214 and Section 217 hereto, the term "Hazardous Materials" shall mean ( i) any "hazardous substance" as defined by the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. Section 9601 et seg• ) , as amended from time to time, and regulations promulgated thereunder; ( ii) any "hazardous substance" as defined by the Carpenter-Presley-Tanner Hazardous Substance Account Act (California Health and Safety Code Sections 25300 et sea. ) , as amended from time to time, and regulations promulgated thereunder; (iii) asbestos; ( iv) polychlorinated biphenyls; (v) petroleum, oil , gasoline (refined and unrefined) and their respective by-products and constituents; and (vi) any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever , which by any "Governmental Requirements" either requires special handling in its use, transportation, generation, collection, storage, handling, treatment or disposal, or is defined as "hazardous" or harmful to the environment . The term "Governmental Requirements" shall mean all laws, ordinances , statutes, codes, rules, regulations, orders and decrees of the United States, the State, the County, the City, or any other political subdivision in which the Property is located, and of any other political subdivision, agency or instrumentality exercising jurisdiction over the Agency, the Developer or the Property. 1 . [§2137 Suitability of the Property The Developer acknowledges and agrees that the Agency will provide the Developer with access to the Property for the purpose of investigating and determining the presence of Hazardous Materials, soil condition of the Property, its 08/05/92 16610/2299/00 - 10 - seismic condition, its geology, the presence of known and unknown faults, and the suitability of the Property for economically feasible development and use thereof by the Developer in accordance with this Agreement. The Developer shall have thirty (30) days from the date of execution of this Agreement by the Agency to undertake, at the Developer 's sole cost and expense, the Hazardous Materials assessment of the Property (the "Hazardous Materials Assessment" ) . The Developer shall provide the Agency with a copy of the Hazardous Materials Assessment immediately upon receipt of same by the Developer. In the event it is determined by the Hazardous Materials Assessment that remediation is required, and the cost thereof is projected to exceed the amount of Five Thousand Dollars ($5 , 000) , the Developer shall have the option to terminate the Agreement. The Developer shall exercise such option by giving the Agency written notice within three (3) days of his receipt of the Hazardous Materials Assessment . In the event it is determined by the Hazardous Materials Assessment that the cost of remediation will be equal to or less than Five Thousand Dollars ($5, 000 . 00) , or if the cost of such remediation exceeds Five Thousand Dollars ($5, 000 . 00) but the Developer has not terminated this Agreement pursuant to this Section 213, or Section 510 of this Agreement, the Developer shall cause the required remediation to be performed with the cost of the remediation to be borne solely by the Developer. 2 . [§214] "As Is" Conveyance Possession of the Property shall be delivered from the Agency to the Developer in an "as is" physical condition, with no warranty, expressed or implied by the Agency as to the presence or absence of Hazardous Materials or the condition of the soil, its geology, or the presence or absence of known or unknown faults, or the suitability of the Property for any particular use or purpose. The Agency acknowledges that the existing building upon the Property is constructed using a reinforced masonry block method and does not constitute a "potentially hazardous building" as defined in California Government Code Section 8875. The Agency cannot warrant that future seismic safety improvements to the building may be required relating to changes in State law. If the condition of the Property (including the building thereon) is not in all respects entirely suitable for the use or uses to which the Property will be put, then it is the sole responsibility and obligation of the Developer to place the Property in all respects in a condition entirely suitable for his development and/or use thereof . 08/05/92 1661Q/2299/00 - 11 - After delivery of possession of the Property, the Developer shall defend, release, indemnify and hold the Agency, the City, and their officers, employees, contractors, and/or agents harmless from any claims, liability, injury, damages, costs and expenses (including, without limitation, the cost of any clean-up of Hazardous Materials and the cost of attorneys ' and consultants• fees arising as a result of the presence of Hazardous Materials) which the use Agency may sustain as a result of the presence or clean-up of Hazardous Materials on the Property. M. [§215] Access to and Entry by the Developer upon the Property The Developer shall have the right of access to and entry upon the Property for the purpose of obtaining data and making surveys and tests necessary for the Hazardous Materials Assessment. The Developer agrees to and shall defend, release, indemnify and hold the Agency and the City harmless from and against any and all injuries or damages, and any liens, arising out of any work or activity of the Developer, his agents, servants, employees or contractors . The Agency agrees to provide or cause to be provided to the Developer all data and information pertaining to the Property and available to the Agency when requested in writing by the Developer. The Agency makes no warranty as to the accuracy or sufficiency of such data or information. N. [§216] Representations and Warranties of Agency The Agency hereby represents and warrants to the Developer as follows: 1. The Agency is the owner of the Property and/or has the full right, power and authority to transfer the Property to the Developer as provided herein and to perform all of the Agency' s obligations hereunder . 2 . To the best of the Agency' s knowledge, there are no unsatisfied mechanic' s or materialman' s lien rights concerning the Property. 3 . Except as to proposed Ortega Highway Realignment plans, to the best of the Agency' s knowledge, no actions, suits, or proceedings are pending or threatened before any governmental department, commission, board, bureau, agency or instrumentality that would adversely affect the Property or the right to occupy or utilize it . 4 . The Agency has disclosed all information concerning the Property of which the Agency is aware on the "Seller' s Disclosure Statement" attached hereto as Attachment 08/05/92 1661Q/2299/00 - 12 - 0 0 No. 5 and incorporated herein by reference. If the Agency becomes aware of any fact or circumstance which would change or render incorrect, in whole or in part, any representation or warranty by the Agency under this Agreement, whether as of the date given or any time thereafter through the close of Escrow, and whether or not such representation or warranty was based on the Agency' s knowledge and/or belief as of a certain date, the Agency will give immediate written notice of such changed facts or circumstances immediately to the Developer. O. [§217] Representations and Warranties of Developer The Developer hereby represents and warrants to, and covenants with, the Agency as follows : 1 . The Developer is familiar with the Property and has made such independent investigations as the Developer deems necessary or appropriate concerning all aspects of the Property, including, but not limited to, its title, physical condition, economic viability, financing and any and all other matters relating to the Property. 2 . Except for the Seller 's Disclosure Statement (Attachment No. 5) and the Agency' s representations and warranties under Section 216 of this Agreement, the Developer is relying solely upon his own inspection, investigation and analysis of the foregoing matters in purchasing the Property, and is not relying in any way upon any representations , statements, agreements, warranties, studies, plans, reports, descriptions, guidelines or other information or material furnished by the Agency or its representatives, whether oral or written, express or implied, of any nature whatsoever regarding any of the foregoing matters . 3 . Except for the Seller ' s Disclosure Statement (Attachment No. 5) and the Agency' s representations and warranties under Section 216 of this Agreement , the Developer acknowledges that he is aware of the condition of the building infrastructure and utilities and that he is acquiring the Property "as is" without representation or warranty by the Agency or any of the Agency' s representatives or agents as to any matters. 9 . In purchasing the Property on an "as is" basis, the Developer acknowledges that in the past certain Hazardous Materials (as defined in Section 212 of this Agreement) may have been stored on and deposited onto the Property which storage and depositing may violate local , state and federal laws, may result in restrictions being placed on the Developer' s use of the Property and may result in fines, damages, cleanup costs and other liability being assessed against the Developer as owner of the Property. The Developer agrees that he will make no claims against the Agency or any 08/05/92 1661Q/2299/00 - 13 - person comprising the Agency for any fines, damages, costs or other losses the Developer suffers because of the past storage or depositing of Hazardous Materials on the Property. The Developer releases the Agency from any liability, loss, damage, judgment, fine, claim, cost or expense ( including, without limitation, attorneys ' fees and court costs) arising from or related to the storage or deposit of Hazardous Materials on the Property, whether or not caused in whole or in part by the active or passive negligence of the Agency. Further the Developer agrees that the Agency shall not be liable for the Developer ' s inability to use or develop the Property as intended for any reason whatsoever due to the past storage or depositing of Hazardous Materials on the Property and that such storage and depositing shall not provide any grounds whatsoever to support rescission of this Agreement or any other recovery by the Developer under this Agreement . In addition, the Agency shall have no liability for any subsequently discovered defects, whether latent or patent, or any other problems related to the Property. 5. The Developer acknowledges that certain exterior or interior modifications to the building, including changes to the facade, may require approval through the normal City review process . The Developer understands that all permit and processing fees and deposits for such modifications are to be paid by the Developer . 6. The Developer acknowledges he is aware of the proposed Ortega Highway Realignment plans and the potential adverse impact it may have upon any business conducted upon the Property. The Developer releases the Agency and the City from any claims, liability, or causes of action regarding damage to his business from such impacts . 7 . The Developer agrees to enter into a Cooperative Parking Agreement with the Agency, in substantially the form attached hereto as Attachment No. 6 and incorporated herein by reference, for the purpose of pursuing discussions regarding long-term parking improvements and policies in the vicinity of the Property. These parking improvements may involve the rear parking area of the Property. P. [§218) Developer ' s Conditions Precedent to Closing The obligation of the Developer to complete his purchase of the Property shall be subject to and contingent upon (1) the consummation of the Developer ' s acquisition of the "Swallows Inn" business operation and name, and (2) the Developer ' s receipt of a Tenant ' s Certificate from the owner of the "Paisley Penguin" in substantially the form attached hereto as Attachment No. 7 and incorporated herein by reference. 08/05/92 16610/2299/00 - 14 - 0 0 III . [53001 DEVELOPMENT OF THE PROPERTY A. [§3011 Scope of Development The Property shall be developed by the Developer in accordance with the Redevelopment Plan and the "Scope of Development" attached to this Agreement as Attachment No . 3 and incorporated herein. B. [§3021 Cost of Construction The cost of constructing, rehabilitating and/or repairing all improvements on the Property shall be borne solely by the Developer . C. [ §3031 City and Other Governmental Agency Permits The Developer shall, at his own expense, secure or cause to be secured, any and all permits which may be required by the City or any other governmental agency affected by such construction, development, or work. D. 153041 Rights of Access Representatives of the Agency and the City shall have the reasonable right of access to the Property without charge or fees, at normal construction hours during the period of construction for the purposes of this Agreement, including, but not limited to, the inspection of the work being performed in constructing the and/or rehabilitating improvements . Such representatives of the Agency or the City shall be those who are so identified in writing by the Community Development Director of the Agency. E. [§3051 Local , State and Federal Laws The Developer shall carry out the construction of the improvements on the Property in conformity with all applicable laws, including all applicable federal and state labor standards . F. [53061 Nondiscrimination During Construction The Developer for himself , his successors and assigns, agrees that in the construction and/or rehabilitation of the improvements on the Property provided for in this Agreement, the Developer will not discriminate against any employee or applicant for employment because of race, color , creed, religion, sex, marital status, or national origin or ancestry. 08/05/92 1661Q/2299/00 - 15 - G. [§307] Certificate of Completion Promptly after completion of all construction and/or rehabilitation of the improvements to be carried out by the Developer upon the Property as generally and specifically required by this Agreement and in particular the Scope of Development (Attachment No. 3) , and all plans approved pursuant hereto, the Agency shall furnish the Developer with a Certificate of Completion upon written request therefor by the Developer. Such Certificate of Completion shall be, and shall so state, conclusive determination of satisfactory completion of the improvement work required by this Agreement upon the Property. The Certificate of Completion shall be in such form as to permit it to be recorded in the Recorder ' s Office of Orange County. Following the Agency' s issuance of the Certificate of Completion to the Developer, the Developer may, at his discretion, make subsequent alterations or enhancements to the Property as are approved by the City and are consistent with the Redevelopment Plan. If the Agency refuses or fails to furnish a Certificate of Completion for the Property after written request from the Developer, the Agency shall , within thirty (30) days of the written request, provide the Developer with a written statement of the reasons the Agency refused or failed to furnish a Certificate of Completion. The statement shall also contain the Agency' s opinion of the action the Developer must take to obtain a Certificate of Completion. If the reason for such refusal is confined to a matter deemed insubstantial by the Community Development Director , the Agency may issue its Certificate of Completion upon the posting of a bond by the Developer with the Agency in an amount representing the fair value of the work not yet completed. If the Agency shall have failed to provide such written statement within said 30-day period, the Developer shall be deemed entitled to the Certificate of Completion. Such Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of the Developer to any holder or any insurer of a mortgage securing money loaned to finance the improvements, or any part thereof . Such Certificate of Completion is not notice of completion as referred to in Section 3093 of the California Civil Code. IV. [§400] USE OF THE PROPERTY A. [§401] Uses The Developer covenants and agrees (for himself, his successors, its assigns, and every successor in interest to the 08/05/92 1661Q/2299/00 - 16 - 0 0 Property or any part thereof) that during construction and thereafter, the Developer, such successors, and such assigns shall - 1 . carry out all development and/or rehabilitation activities as provided for in this Agreement in such manner as will not cause the temporary or permanent displacement of the businesses currently occupying the Property; 2. develop, rehabilitate, maintain and operate the Property as described in the Scope of Development (Attachment No. 3) and any plans approved pursuant hereto, and devote the Property to that use, as specified therefor in the Redevelopment Plan and this Agreement; 3 . maintain the improvements on the Property in good condition and faithful to their western flavor and historic character , and keep the Property free from debris, graffiti or waste materials and maintain the landscaping in a healthy and weed-free condition; 4 . continue to operate the historic "Swallows Inn" business upon the Property for a minimum of five (5) years after the date of conveyance of the Property to the Developer, so long as the financial viability of the "Swallows Inn" business enterprise supports its continued operation. The Agency will cooperate in the transfer of the "Swallows Inn" business operation and name as such transfer relates to City permits and licenses . B. [§402] Obligation to Refrain from Discrimination There shall be no discrimination against or segregation of any person, or group of persons, on account of race, color , creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, and the Developer itself (or any person claiming under or through it) shall not 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 Property. C. [§4031 Form of Nondiscrimination and Nonsegregation Clauses The Developer shall refrain from restricting the rental , sale or lease of the Property, or any portion thereof, on the basis of sex, marital status, race, color, religion, creed, ancestry or national origin of any person. All such deeds , 08/05/92 1661Q/2299/00 - 17 - 0 9 leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses : 1. In deeds : "The grantee herein covenants by and for himself , his heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or any person claiming under or through him, 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 in the land herein conveyed. The foregoing covenants shall run with the land. " 2. In leases : "The lessee herein covenants by and for himself, his heirs, executors, administrators and assigns, and all persons claiming under or through him, and this lease is made and accepted upon and subject to the following conditions : That there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry, in the leasing, subleasing, transferring, use or enjoyment of the land herein leased nor shall the lessee himself, or any person claiming under or through him, 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 , sublessees, subtenants or vendees in the land herein leased. " 3 . In contracts : "There shall be no discrimination against or segregation of any person, or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land, nor shall the transferee himself or any person claiming under or through him, 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 land. " 08/05/92 16610/2299/00 - 18 - D. [§404] Effect and Duration of Covenants The covenants established in this Agreement shall , without regard to technical classification and designation, be binding on the Developer and any successor in interest to the Property, or any part thereof, for the benefit and in favor of the Agency, its successors and assigns, and the City. Except as set forth in the following sentence, the covenants contained in this Agreement shall remain in effect until the termination of the Redevelopment Plan. The covenants against discrimination (set forth in Sections 402 and 403) shall remain in perpetuity. V. [ 5500) DEFAULTS, REMEDIES AND TERMINATION A. [5501] Defaults - General Subject to the extensions of time set forth in Section 605, failure or delay by either party to perform any term or provision of this Agreement constitutes a default under this Agreement. The party who so fails or delays must immediately commence to cure, correct, or remedy such failure or delay, and shall complete such cure, correction or remedy with reasonable diligence, and during any period of curing shall not be in default . The injured party shall give written notice of default to the party in default, specifying the default complained of by the injured party. Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default . Except as otherwise expressly provided in this Agreement, any failures or delays by either party in asserting any of its rights or remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies . Delays by either party in asserting any of its rights or remedies shall not deprive either party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect , assert or enforce any such rights or remedies . B. B5021 Legal Actions 1. B5031 Institution of Legal Actions In addition to any other rights or remedies, either party may institute legal action to cure, correct or remedy any default, or to obtain any other remedy consistent with the purpose of this Agreement. Such legal actions may be instituted in the Superior Court of the County of Orange, State 08/05/92 16610/2299/00 - 19 - 0 of California, in an appropriate municipal court in that County, or in the Federal District Court in the Central District of California. 2. [ §504] Applicable Law The laws of the State of California shall govern the interpretation and enforcement of this Agreement . 3 . [§505] Acceptance of Service of Process In the event that any legal action is commenced by the Developer against the Agency, service of process on the Agency shall be made by personal service upon the Secretary of the Agency, or in such other manner as may be provided by law. In the event that any legal action is commenced by the Agency against the Developer, service of process on the Developer shall be made by personal service upon the Developer or in such other manner as may be provided by law, and shall be valid whether made within or without the State of California. C. [§506] Rights and Remedies are Cumulative Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same time or different times, of any other rights or remedies for the same default or any other default by the other party. D. [§507] Damages If either party defaults with regard to any of the provisions of this Agreement, the nondefaulting party shall serve written notice of such default upon the defaulting party. If the default is not commenced to be cured within thirty (30) days after service of the notice of default and is not cured promptly in a continuous and diligent manner within a reasonable period of time after commencement, the defaulting party shall be liable to the nondefaulting party for any damages caused by such default, and the nondefaulting party may thereafter (but not before) commence an action for damages against the defaulting party with respect to such default . E. [§508] Specific Performance If either party defaults with regard to any of the provisions of this Agreement, the nondefaulting party shall serve written notice of such default upon the defaulting party. If the default is not commenced to be cured within thirty (30) days after service of the notice of default and is not cured promptly in a continuous and diligent manner within a 08/05/92 1661Q/2299/00 - 20 - 0 0 reasonable period of time after commencement, the nondefaulting party, at its option, may thereafter (but not before) commence an action for specific performance of the terms of this Agreement pertaining to such default . F. [5509] Remedies and Rights of Termination 1 . [§510] Termination by Developer (a) In addition to the Developer ' s option to terminate this Agreement as set forth in Section 213 hereof, in the event the Developer is not in default of any of the terms and conditions of this Agreement and the Agency does not tender conveyance of title and possession of the Property to the Developer in the manner and condition and within the time established therefor by Section 203 of this Agreement, then the Developer shall notify the Agency in writing to cure such failure within ninety (90) days after the date of receipt of such notice. If such failure shall not be cured within such ninety (90) day period, then this Agreement shall , at the option of the Developer, be terminated by written notice thereof to the Agency. In such event, the Purchase -Price, if any shall have been paid, and the Good Faith Deposit shall be returned to the Developer, and thereafter neither the Agency nor the Developer (or assignee or transferee) shall have any further rights against or liability to the other under this Agreement . (b) Notwithstanding anything herein to the contrary, in the event conveyance of the Property has not occurred within five (5) days after the Developer has acquired the "Swallows Inn" business operation and name, or such later date as the parties shall agree in writing, either party hereto may terminate this Agreement upon thirty (30) days written notice to the other party. 2 . [5511] Termination by Agency In the event that prior to the conveyance of title or transfer of possession to the Property to the Developer : (a) The Developer (or any successor in interest) assigns or attempts to assign this Agreement or any rights herein, or makes any total or partial sale, transfer, or conveyance of the whole or any part of the Property or the improvements thereon, in violation of this Agreement; or (b) There is a change in ownership of the Developer contrary to the provisions of Section 108 of this Agreement; or (c) The Developer does not deliver the Good Faith Deposit to the Agency in the amount and within the time established therefor in Section 201 of this Agreement; or 08/05/92 16610/2299/00 - 21 - (d) The Developer does not pay the Purchase Price, pursuant to Section 207 of this Agreement; or (e) The Developer does not take title to the Property under a tender of conveyance by the Agency pursuant to this Agreement; or (f) The Developer is otherwise in default of this Agreement; then, in addition to any other remedy to which the Agency may be entitled, this Agreement and any rights of the Developer or transferee thereof arising from this Agreement shall , at the option of the Agency, be terminated by the Agency by written notice thereof to the Developer . From the date of the written notice of termination of this Agreement by the Agency to the Developer and thereafter this Agreement shall be deemed terminated and there shall be no further rights or obligations between the parties , except the retention of the entire Good Faith Deposit by the Agency as liquidated damages as hereinafter set forth. IN THE EVENT OF AGENCY TERMINATION OF THIS AGREEMENT UNDER THIS SECTION 511, THE GOOD FAITH DEPOSIT, AS SET OUT IN SECTION 201 HEREOF, SHALL BE RETAINED BY THE AGENCY AS LIQUIDATED DAMAGES AS THE SOLE AND EXCLUSIVE REMEDY OF THE AGENCY HEREUNDER. IN THE EVENT OF TERMINATION, THE AGENCY WOULD SUSTAIN DAMAGES BY REASON THEREOF WHICH WOULD BE UNCERTAIN. SUCH DAMAGES WOULD INVOLVE SUCH VARIABLE FACTORS AS THE DELAY OR FRUSTRATION OF TAX REVENUES THEREFROM TO THE CITY OF SAN JUAN CAPISTRANO AND THE AGENCY, THE DELAY OR FAILURE OF THE AGENCY TO FURTHER THE IMPLEMENTATION OF THE REDEVELOPMENT PLAN, AND A LOSS OF OPPORTUNITY TO ENGAGE IN OTHER POTENTIAL TRANSACTIONS, RESULTING IN DAMAGE AND LOSS TO THE AGENCY. IT IS IMPRACTICABLE AND EXTREMELY DIFFICULT TO FIX THE AMOUNT OF SUCH DAMAGES TO THE AGENCY, BUT THE PARTIES ARE OF THE OPINION, UPON THE BASIS OF ALL INFORMATION AVAILABLE TO THEM THAT SUCH DAMAGES WOULD APPROXIMATELY EQUAL THE AMOUNT OF THE GOOD FAITH DEPOSIT, AND SUCH AMOUNT SHALL BE RETAINED BY THE AGENCY UPON TERMINATION AS THE REASONABLE TOTAL OF ALL LIQUIDATED DAMAGES FOR ANY AND ALL SUCH DEFAULTS AND NOT AS A PENALTY. IN THE EVENT THAT THE DEVELOPER SHOULD CHALLENGE THE APPLICABILITY OR EFFICACY OF THIS PARAGRAPH OR IF THIS PARAGRAPH SHOULD BE HELD TO BE VOID FOR ANY REASON, THE AGENCY SHALL BE ENTITLED TO THE FULL EXTENT OF DAMAGES OTHERWISE PROVIDED BY LAW. 08/05/92 1661Q/2299/00 - 22 - • i THE DEVELOPER AND THE AGENCY SPECIFICALLY ACKNOWLEDGE THIS LIQUIDATED DAMAGES PROVISION BY THEIR SIGN ELOW: Developer ency-- Notwithstanding the termination of the Agreement by the Agency as set forth in this Section 511, the obligation of the Developer to the Agency and the City set forth in Section 215 of this Agreement, shall remain in full force and effect . Notwithstanding anything herein to the contrary, the Agency shall have the right to terminate this Agreement pursuant to and in accordance with Section 510(b) hereinabove. G. 85121 Rights and Remedies Subsequent to the Issuance of a Certificate of Completion If either the Developer or the Agency defaults under any of the provisions of this Agreement subsequent to the issuance of the Certificate of Completion, then subject to the provisions of Section 501 , the non-defaulting party at its option may institute an action at law or in equity, and/or the defaulting party shall be liable to the other party for any damages caused by such default, and/or the non-defaulting party may seek any remedies available at law or in equity. VI . B6001 GENERAL PROVISIONS A. [9601] Notices, Demands and Communications Between the Parties Formal notices, demands and communications between the Agency and the Developer shall be deemed sufficiently given if dispatched by registered or certified mail, postage prepaid, return receipt requested, to the principal offices of the Agency and the Developer as provided in Section 106 and 107 of this Agreement . Such written notices, demands and communications may be sent in the same manner to such other addresses as either party may from time to time designate by mail as provided in this Section. B. [ §602] Conflicts of Interest No member, official or employee of the Agency shall have any direct or indirect interest in this Agreement, nor participate in any decision relating to the Agreement which is prohibited by law. 08/05/92 16610/2299/00 - 23 - • C. [§603] Warranty against Payment of Consideration for Agreement The Developer warrants that he has not paid or given, and will not pay or give, any third person any money or other consideration for obtaining this Agreement, other than normal costs of conducting business and costs of professional services such as architects, engineers and attorneys . D. [§6041 Nonliability of Agency Officials and Employees No member, official or employee of the Agency shall be personally liable to the Developer, or any successor in interest, in the event of any default or breach by the Agency or for any amount which may become due to the Developer or successor, or on any obligation under the terms of this Agreement. E. [§6051 Enforced Delay: Extension of Times of Performance In addition to specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in default where delays or defaults are due to war; insurrection; strikes; lock-outs; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemic; quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; litigation (other than condemnation actions) ; unusually severe weather; inability to secure necessary labor, materials or tools; delays of any contractor, subcontractor or supplier; acts of the other party; acts or the failure to act, of any public or governmental agency or entity (except that acts or failure to act of the Agency shall not excuse performance by the Agency) ; or any other causes beyond the control or without the fault of the party claiming an extension of time to perform. An extension of time for any such cause shall only be for the period of the enforced delay, and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by mutual agreement of the Agency and the Developer . F. [§6061 Approval by the Agency and the Developer Wherever this Agreement requires the Agency or the Developer to approve any contract, document, plan, proposal , specification, drawing or other matter, such approval shall not be unreasonably withheld. 08/05/92 1661Q/2299/00 - 24 - 0 G. [§607] Plans and Data Where the Developer does not proceed with the purchase and development of the Property, and when this Agreement is terminated with respect thereto for any reason, the Developer shall deliver to the Agency any and all plans concerning the Property, and the Agency or any person or entity designated by the Agency shall have the right to use such plans and data . VII . [§700] ENTIRE AGREEMENT, WAIVERS AND AMENDMENTS This Agreement is executed in five (5) identical originals, each of which is deemed to be an original . This Agreement includes twenty-six (26) pages and seven (7) Attachments which constitute the entire understanding and agreement of the parties . This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the parties with respect to all or any part of the subject matter hereof. None of the terms, covenants, agreements or conditions set forth in this Agreement shall be deemed to be merged with the Grant Deed conveying title to the Property, the Covenant Agreement and this Agreement shall continue in full force and effect before and after such conveyance. All waivers of the provisions of this Agreement must be in writing and signed by the appropriate authorities of the Agency or the Developer, and all amendments hereto must be in writing and signed by the appropriate authorities of the Agency and the Developer. VIII . [§800] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY This Agreement, when executed by the Developer and delivered to the Agency, must be authorized, executed and delivered by the Agency within forty-five (45) days after the date of signature by the Developer, or this Agreement may be withdrawn by the Developer on written notice to the Agency. 08/05/92 1661Q/2299/00 - 25 - 0 0 The date of this Agreement shall be the date when this Agreement shall have been signed by the Agency. SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, a public body, corporate and politic Date: August 18, 1992 By: I , Kennefn F. Friess, unairman "AGENCY" APPROVED AS TO FORM: ATTEST: STRADLING, YOCCA, CARLSON & RAUTH By: t �; - Agency Special CounselAgency Setketkry RALPH FURRA, an individual Date: By: �A� Ralph Furra "DEVELOPER" 08/05/92 1661Q/2299/00 - 26 - f•E`F ` '-r SrREET o DEL OgrS'= tl 0 1 a t.� TR-vr l"AC , a 1 1 1 .LM LOI r! it 1 'Fee -� 1 t 9 Aw 1 . 1 •, 31 Jr s I R � ar►• � � �!� M LL ' 1 I O K Lis A!. ® L�riloc 1 SA r. ,11 S[N. bKA d a = C cc 30LW ' � a AA as o :a ; EZ J rw1Mw e AEAt 1 App JCS • � O „ R�� L �.. M. LII N � ®� rRAW ® ; CArrsrMAV ' L tar r.J.vl 1 I NOTE - ASSESSORS SLOCR S ASSESSOR'S NAP CAM►NO 121 _ 15 0 PARCEL Nt/NSERS SOON 120 PAGE is --fia CN /95/ SHOW NY CIRCLES COfJNTr OF ORAAGE VS. SAN ANN ('AP/STRAA'O• RS2-33 1 �� ATTACHMENT NO. 2 LEGAL DESCRIPTION Lot 26 of Tract 103, in the City of San Juan Capistrano, as shown on a map recorded in Book 11, Pages 29 to 33 inclusive, in the office of the orange county recorder. The property is further identified as Assessor Parcel 124-160-121. ATTACHMENT NO. 2 ATTACHMENT NO. 3 SCOPE OF DEVELOPMENT The Developer understands and appreciates the western flavor, historic character, and local legends surrounding the Property. The Developer is purchasing the Property in an "as is" condition, and will undertake the rehabilitation of the Property, maintaining the integrity of the building and improvements thereon, while at the same time providing necessary improvements and upgrades . The Developer will undertake the rehabilitation of the Property in such manner as will not cause the temporary or permanent displacement of the businesses currently occupying the Property. In conjunction with the purchase of the Property, the Developer is acquiring the "Swallows Inn" business and name. The Developer will continue to operate the historic "Swallows Inn" business in this location for a minimum of five (5) years after the date of conveyance of the Property to the Developer, so long as the financial viability of the "Swallows Inn" enterprise supports its continued operation. 1661Q/2299/00 ATTACHMENT NO. 3 Order No. • ATTACHMENT NO. 4 • Escrow No. Loan No. WHEN RECORDED MAIL TO: SPACE ABOVE THIS LINE FOR RECORDER'S USE MAIL TAX STATEMENTS TO: DOCUMENTARY TRANSFER TAX$............................................................ ......Computed on the consideration or value of property conveyed; OR ...... Computed on the consideration or value less liens or encumbrances remaining at time of sale. Signature oi Declarant or Agent determin ng tax—Firm Nme GRANT DEED FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, hereby GRANT(S) to the real property in the City of State of California, described as County of • ATTACHMENT NO. 5 • SELLER'S DISCLOSURE STATEMEIN'T THIS DISCLOSURE STATEMENT CONCERNS THE REAL PROPERTY SITUATED IN THE CITY OF SAN JUAN CAPISTRANO, COUNTY OF ORANGE, STATE OF CALIFORNIA, LOCATED AT 31786 CAMINO CAPISTRANO (Assessor Parcel #124-160-21). THIS STATEMENT IS A DISCLOSURE OF THE CONDITION OF THE ABOVE DESCRIBED PROPERTY. IT IS NOT A WARRANTY OF ANY KIND BY THE SELLER AND IS NOT A SUBSTITUTE FOR ANY INSPECTIONS OR WARRANTIES THE BUYER MAY WISH TO OBTAIN. SELLER'S INFORMATION THE FOLLOWING INFORMATION IS A DISCLOSURE MADE BY THE SELLER AS TO THE SUBJECT PROPERTY AS REFERENCED IN SECTION 216 OF THAT CERTAIN DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY AND RALPH FURRA. THE SELLER DISCLOSES THE FOLLOWING INFORMATION WITH THE KNOWLEDGE THAT EVEN THOUGH THIS IS NOT A WARRANTY, THE BUYER MAY RELY ON THIS INFORMATION IN DECIDING WHETHER AND ON WHAT TERMS TO PURCHASE THE SUBJECT PROPERTY. A. The subject property has the items checked below (read across): _ Burglar Alarms Rain Gutters _ Central Heating Evaporator Cooler(s) Smoke Detector(s) Public Sewer System Fire Alarm Private Utility or _ Central Air Conditioning _ Other: _ Fire Sprinklers �/ Exhaust Fan(s) in K mvi IJ i Moms 220 Volt Wiring in `NALK- )N GOOL 454 Roof(s): Type: 11_ —Vi0 0" C.ORR Age(approx.): Other: �►6FJ�6L413 j Are there, to the best of your (Seller's) knowledge, any of the above that are not in operating condition? X Yes _ No. If es, then describe. Attach additional sheets if necessary.): • IN�10 • Mit doey"AdOe S rrl : �( S 1 rr0 B, a you (Seller) aware of any tigs<ifua-* defects/malfunctions in any of the following? Yes _ No. If yes, check appropriate space(s) below. _ Interior Walls _ Foundation _ Ceilings _ Slab(s) _ Floors _ Driveways Exterior Walls _ Sidewalks InsX Rooulationf(si5� PA6a I _ Walls/Fencesrival Electrical Systems Windows g Plumbing/Sewers _ Doors _ Other Structural Components(Describe: ) If • checked, explain. (Attach additional sheets if n arylan o / is Q : �i it ' /4/+e C. Are you (Seller) aware of any of the following: 1. Substances, materials, or products which may be an environmental hazard such as, but not limited to, asbestos, formaldehyde, radon gas, lead-based paint, fuel or chemical storage tanks, and contaminated soil or water on the subject property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . _Yes No 2. Features of the property shared in common with adjoining landowners,such as walls,fences, and driveways, whose use or responsibility for maintenance may have an effect on the subject property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . _Yes KNO 3. Any encroachments, easements or similar matters that may affect your interest in the subject property . . . . . . . . . . . . _Yes �(No 4. Structural modifications or other alterations or repairs made without necessary permits . . . . . . . . . . . . . . . . . . . . . . _Yes yNo 5. Structural modifications or other alterations or repairs not in compliance with building codes . . . . . . . . . . . . . . . . . . Yes KNo 6. Landfill (compacted or otherwise) on the property or any portion thereof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . _ Yes KNo 7. Any settling from any cause, or slippage, sliding or other soil problems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . _ Yes KNo B. Flooding, drainage or grading problems . . . . . . . . . . . . . Yes )�'No 2299000 f.W,abubn391mwm*r.00r 2 9. Major damage to the property or any of the structures from fire, earthquake, floods or landslides Yes �<No 10. Any zoning violations, nonconforming uses, violations of 'setback' requirements . . . . . . . . . . . . . . . . . . . . . . . . _Yes J No 11. Neighborhood noise problems or other nuisances . . . . . . . _ Yes XNo 12. CC&R's or other deed restrictions or obligations . . . . . . . _Yes No 13. Any 'common area' (facilities such as walkways or other areas �( co-owned in undivided interest with others) . . . . . . . . . . . _Yes / No 14. Any notices of abatement or citations against the property . . _Yes �KNo 15. Any lawsuits against the seller threatening to or affecting this real property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . _Yes ^No If the answer to any of these is yes, explain. (Attach additional sheets if necessary.): Seller certifies that the infornuuion herein is true and correct to the best of Seller's knowledge as of the date signed by the Seller. Seller: San JuanC istrano Community Redevelopment Agency By: Date: 61- 2o- 92. Its: )F/X4-P -3&<VJZZ> v V4T0 I ACKNOWLEDGE RECEIPT OF A COPY OF THIS STATEMENT. Buyer: Date: 22"WO t a.ub�tu9�wor>.00� 3 ATTACHMENT NO. 6 SWALLOWS INN COOPERATIVE PARKING AGREEMENT THIS Cooperative Parking Agreement ("Parking Agreement") is entered by and between the San Juan Capistrano Redevelopment Agency ( "Agency") and Ralph Furra ("Furra") . RECITALS A. The parties have concurrently herewith entered into that certain Disposition and Development Agreement pursuant to which the Agency has agreed to convey to Furra that certain property located at 31782-31786 Camino Capistrano, San Juan Capistrano ("Property") , commonly known and operates as the Swallows Inn and Paisley Penguin. B. The parties acknowledge that the Agency and the City of San Juan Capistrano ("City") are considering the overall redevelopment of downtown San Juan Capistrano which may include the re-alignment of Ortega Highway, the development of an Historic Town Center Archaeological Park, the development of additional tourist activities and the construction of improved parking facilities . C. In connection with such proposed redevelopment, the Agency and City anticipate common use and/or public parking to serve downtown tourist and commercial activities . And, in this regard, the parties anticipate the possibility that the unimproved portion of the Property, currently used as a parking lot, ("Swallows inn Parking Lot") may subsequently be needed for common use and/or public parking . AGREEMENT NOW, THEREFORE, in consideration for the conveyance described in Recital A. above, the parties agree, as follows : 1. The Agency or City may use excess parking at the Swallows Inn Parking Lot for public parking during hours and under conditions to be established by Furra and the Agency. 2 . Furra agrees to participate in a downtown parking district if and when one is established; provided that nothing in this paragraph 2 requires Furra to support the formation of such district. 0 0 3 . Furra will reasonably cooperate with the Agency and/or City at such time as the City develops an overall plan for use of the Swallows Inn Parking Lot . To this end, Furra acknowledges and agrees that the Agency and/or City may bring an action in eminent domain to acquire all or a portion of the Property and/or the Swallows Inn Parking Lot provided that Furra is entitled to just compensation for any property taken but hereby waives any claim for severance damages if the Agency and/or City provides parking for the Property, substantially similar in size, location and utility as is presently available to the Property. In addition, the measure of just compensation will be based on the use of the Property for its present business uses or for any proposed expansion or new uses which could reasonably be anticipated to be approved by the City assuming the availability of parking as aforesaid. 4 . Currently the Swallows Inn Parking Lot is designated for "Patron Use Only, " the adjacent lot to the north is designated for three-hour parking only, and the lot to the south is designated for all day parking . Patrons of the Property currently .use these surrounding lots and patrons of businesses in the vicinity may use the Swallows Inn Parking Lot. Furra agrees to continue this cooperative use as long as such use does not interfere with the businesses being operated on the Project . 5 . The City of San Juan Capistrano currently leases a parking area off of El Camino Real for downtown merchant and employee parking. These spaces will be made available to employees of the Owner to maximize the space available for patron parking . 6 . The obligations contained herein shall be deemed to be a covenant running with the land and will be recorded against the Property. 7 . This Parking Agreement shall terminate as of September 30, 1997 provided that such termination shall not be construed as a waiver of the right of eminent domain with respect to the Property. 08/20/92 2193Q/2299/54 - 2 - ATTACHMENT NO. 7 TENANT ' S CERTIFICATE TENANT: PREMISES: THIS TENANT' S CERTIFICATE is executed by TENANT, who is currently the tenant under an oral month-to-month tenancy agreement by and between the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY ( "Landlord" ) and Tenant with respect to the Premises (the "Agreement" ) . Subject to any exceptions and qualifications stated in Paragraph 12, below, Tenant represents, warrants, certifies and states each of the following: 1 . The Agreement is presently in full force and effect . 2 . Landlord has satisfied all commitments, if any, made to Tenant, and to the best of Tenant ' s knowledge, is not in any respect in default in the performance by Landlord of its obligations under the Agreement . 3 . Tenant fully occupies the Premises and is not in any respect in default or breach of the Agreement and has not assigned, sublet, transferred or hypothecated its interest under the Agreement . 4 . Tenant has no notice or knowledge of any prior assignment, hypothecation or pledge of rents of the Agreement . 5 . Neither Tenant nor Landlord has begun any action, or given or received any notice for the purpose of termination of the Agreement . 6 . Tenant has paid all monetary obligations as required under the Agreement. 7. There is no period of free rent, rental abatement or reduction, and Landlord has not given or conceded to Tenant any other concessions, abatements or compromises with respect to the rental obligations under the Agreement, nor has Landlord waived or purchased any other period of free rent, rental abatement or reduction. 1661Q/2299/00 ATTACHMENT NO. 7-1 0 0 8. There are no offsets or credits against or defenses to payment of any monetary obligations payable under the Agreement and Tenant has made no payments to Landlod as a security deposit or advance or prepaid rental . 9 . Tenant ' s address for notice is : 10 . This Tenant ' s Certificate is a legal, valid, binding and enforceable obligation of the Tenant . Tenant has reviewed and understands this document and has had an opportunity to discuss this with counsel or has waived such opportunity. 11 . Other than cleaning and office supplies used and stored on the Premises in the normal course Tenant ' s business, Tenant does not use, handle, store or dispose of any asbestos , polychlorinated biphenyls, petroleum, oil, gasoline, or any "hazardous substance" as defined by either the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S .C. Section 9601 et seg. ) , as amended from time to time (and regulations promulgated thereunder) , or the Carpenter-Presley-Tanner Hazardous Substance Account Act (California Health and Safety Code Sections 25300 et seg. ) , as amended from time to time (and regulations promulgated thereunder) , in connection with Tenant ' s business in the Premises. 12. The representations set forth above are subject to the following exceptions and qualifications (if none stated, all representations shall be taken as without exception or qualification) : IN WITNESS WHEREOF, Tenant has caused this Tenant ' s Certificate to be executed this day of 1992 . TENANT By: Title: 1661Q/2299/00 ATTACHMENT NO. 7-2 AUGUST 18, 1992 REGULAR MEETING OF THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY BOARD OF DIRECTORS The Regular Meeting of the Board of Directors of the City of San Juan Capistrano Redevelopment Agency was called to order by Chairman Friess at 9:30 p.m. in the City Council Chamber. ROLL CALL PRESENT: Kenneth E. Friess, Chairman Gil Jones, Vice Chairman Jerry Harris, Director Gary L. Hausdorfer, Director Jeff Vasquez, Director ABSENT: None STAFF PRESENT: Stephen B.Julian, Executive Director; Thomas Tomlinson, Deputy Director; Richard K. Denhalter, Agency Counsel; David Bentz, Finance Officer; Cheryl Johnson, Agency Secretary; George Scarborough,Assistant City Manager;William Huber,Director of Engineering and Building Services;Al King, Jr., Director of Community Services; Nancy Bernardi, Recording Secretary. MINUTES The Minutes of the Regular Meeting of July 21, 1992,were approved as submitted as part of the City Council Consent Calendar. PUBLIC HEARINGS —� 1. JOINT PUBLIC HEARING WITH THE CITY COUNCIL- PROPOSED DISPOSITION AND DEVELOPMENT AGREEMENT, 31782-31786 CAMINO CAPISTRANO (SWALLOWS INN FURRA 600.40 Proposal: Joint Public Hearing with the City Council to consider a Disposition and Development Agreement for the sale of the Agency-owned property located at 31782-31786 Camino Capistrano (Swallows Inn and Paisley Penguin). Written Communication: Report dated August 18, 1992, from the Community Development Manager, recommending that the highest bid received by the Agency for the property from Ralph A. Furra be accepted in the amount of$500,000, a gain of$126,751 over the original purchase price. Mr. Furra has agreed to enter into a separate agreement with the owner of the Swallows Inn to purchase the name and business operation and continue its operation for a minimum of five years. Mr.Julian noted that an easement agreement between the Agency and Mr.Furra for the rear parking lot portion of the site to facilitate the possibility of future public parking improvements in the area was still under review at this time. He suggested that the Disposition and Development Agreement be approved subject to completion of the Real Estate Disclosure Statement prior to execution by the Agency Chairman and resolution to the satisfaction of the Agency the issue of the parking easement for reservation of parking rights. -1- 8/18/92 Mr. Denhalter advised that the residential and business properties within 2,500 feet of this project owned by three of the Directors would not be financially impacted by the sale of these properties because there was no change proposed in the uses. Therefore, he felt there would be no conflict of interest for any of the Directors involved. Public Hearing: Notice having been given as required by law,Mayor Jones opened the Public Hearing,and there being no response, closed the hearing with the right to reopen at any time. Board Discussion: Chairman Friess and Directors Vasquez and Jones concurred with Mr.Denhalter's opinion regarding potential conflicts of interest and stated they would vote in the matter. Director Vasquez expressed concern that the parking easement be included in the negotiated sale price and not be sold back to the Agency for the proposed realignment of Ortega Highway at a future date. Resolution Aooroving_Disuosition and Development Agreement: It was moved by Director Hausdorfer, seconded by Chairman Friess, that the following Resolution be adopted, subject to completion of the Real Estate Disclosure State prior to execution by the Agency Chairman and resolution of the parking easement rights issue: RESOLUTION NO. CRA 92-8-18-1. APPROVING DISPOSITION AND DEVELOPMENT AGREEMENT FOR THE SALE OF PROPERTY LOCATED AT 31782-31786 CAMINO CAPISTRANO TO RALPH A.FURRA(SWALLOWS INN) - A RESOLUTION OF THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, CITY OF SAN JUAN CAPISTRANO, CALIFORNIA, APPROVING THE DISPOSITION AND DEVELOPMENT AGREEMENT FOR CERTAIN PROPERTY WITHIN THE SAN JUAN CAPISTRANO CENTRAL REDEVELOPMENT PROJECT AREA TO RALPH A. FURRA (SWALLOWS INN) The motion carried by the following vote: AYES: Directors Harris, Hausdorfer, Jones, Vasquez, and Chairman Friess NOES: None ABSENT: None BOARD ACTIONS 1. FINANCE OFFICER'S REPORT OF INVESTMENTS AS OF JULY 31. 1992 (350.30) It was moved by Director Hausdorfer,seconded by Director Harris and unanimously carried to receive and file the Finance Officer's Report of Investments as of July 31, 1992, in the total amount of $600,357.68. 2. ARCHAEOLOGIST CONSULTING AGREEMENT (ROBERTA GREENWOOD) (60040) Written Communication: Report dated August 18, 1992, from the Community Development Manager, recommending that the Agency enter into a two-year contract with Roberta Greenwood and Associates as the City's -2- 8/18/92 • • AGENDA ITEM August 18, 1992 TO: Stephen B. Julian, Executive Director FROM: Cassandra C. Walker,-Community Development Manager SUBJECT: Joint Public Hearing of the City of San Juan Capistrano and the San Juan Capistrano Community Redevelopment Agency on the proposed Disposition and Development Agreement for the property located at 31782-86 Camino Capistrano RECOMMENDATION Open the Public Hearing and take public testimony. By motion, adopt the resolution, and approve and execute the Disposition and Development Agreement with Ralph A. Furra, and authorize the Executive Director, on behalf of the Agency, to sign all documents necessary to carry out and implement the Agreement, to administer the Agency's obligations, responsibilities, and duties to be performed under the Agreement. SITUATION A. Summary and Recommendation - In April 1992, the Agency approved the process and schedule for the sale of Agency-owned property located at 31782-31786 Camino Capistrano, better known as the Swallows Inn and Paisley Penguin. On June 24, 1992, the Agency received three offers to purchase the property which varied in terms of price and future use of the property. On July 7, 1992, the Agency directed staff to enter into exclusive negotiations with Ralph A. Furra toward the sale of the property. The terms and conditions of the sale are outlined in the Disposition and Development Agreement and were reviewed with the Agency Board of Directors on August 4, 1992. At that time, the Executive Director was asked to secure an easement on the rear parking lot portion of the site to facilitate the possibility of future public parking improvements in the area. A meeting regarding the easement is scheduled for August 17, 1992. Staff recommends that the Agency Board of Directors adopt the Resolution and execute the Disposition and Development Agreement. The Disposition and Development Agreement may have to be modified to reflect the outcome of the negotiations regarding the easement. B. Background - The Agency acquired the Swallows Inn and Paisley Penguin property in 1985 from the Olivares Estate for $373,249. The property was originally purchased in FOR CITY COUNCIL AGEN �I7� I Agenda Item - 2 - August 18, 1992 anticipation of the commercial/retail development of the Historic Town Center area. The Agency has determined that this property is not needed for the Historic Town Center project, and it would be appropriate to sell the site at this time. In April 1992, the Agency approved the process and schedule for the sale of this property. The Agency went through a lengthy "Invitation to Bid" process to select a Buyer for the property. Brochures were mailed out to over 500 interested parties. The property was advertised in several publications including the Los Angeles Times, The Orange County Register, Daily Sun/Post, National Trust for Historic Preservation Newsletter, and the Society for Architectural Historians Newsletter. The Agency received three bids in response to the "Invitation to Bid". The bids ranged from $395,000 to $500,000. Of primary consideration in selecting a Buyer for the building was the desire for the new owner to continue the Swallows Inn use and maintain and rehabilitate the structure. The Agency also expected the Buyer to provide an easement to the rear parking lot. In July, the Agency directed staff to enter into exclusive negotiations with Ralph A. Furra regarding the terms and conditions of a Disposition and Development Agreement for the property. The Disposition and Development Agreement provides for the following: 1. A sales price of $500,000, which reflects a gain of $126,751 over the original purchase price. 2. Mr. Furra will purchase the Swallows Inn business and name and will continue its operation for a period of five years. Mr. Furra has entered into a separate Agreement with the owner of the Swallows Inn, Tacy Lee, to purchase the name and business operation. The Disposition and Development Agreement requires execution of this agreement. 3. The Executive Director has not yet negotiated an easement agreement with Mr. Furra per the Agency's direction at the August 4, 1992 meeting. A meeting has been scheduled for August 17, 1992 to discuss the easement. However, Mr. Furra has agreed to the execution of a Cooperative Parking Agreement which outlines discussion issues relating to future parking improvements in the area. The negotiated sales price is less than the fair market appraisal for the property. In June of 1992, the Agency had an appraisal prepared for the property. Three methods of evaluation were used to determine the highest and best use. These methodologies are as follows: Income Capitalization $662,000 Replacement Cost $573,000 Sales Comparison - Land Value $536,000 with Adjustments $660,000 Agenda Item • 3 - • August 18, 1992 Based on these methods, the fair market value of the property was determined to be $660,000. The original offer was for $400,000. The Executive Director has negotiated the offer to $500,000 and recommends that the Agency approve this sales price for several reasons. 1. The Agency went through a lengthy and comprehensive "Invitation to Bid" process to select a purchaser for the property. This offer equals the highest bid amount. 2. The offer indicates and the Disposition and Development Agreement requires that the Buyer purchase the Swallows Inn business and name. The continued operation of this historic community landmark has an undetermined value and benefit to the community. 3. The appraisals are at highest and best use. The existing facility is in need of significant rehabilitation including a new roof, upgraded plumbing, heating, air conditioning, electrical, and restroom facilities. The Buyer will purchase the property in an "as is" condition. 4. The appraisal value was also based on the fair market rent. The current rental rates for the Swallows Inn and Paisley Penguin are below fair market value. There is some question regarding the ability of the current businesses operations to afford higher rents based on current market conditions. 5. Although, the offer does not meet the fair market value for the property, the proposed offer facilitates what the Agency is trying to accomplish: An experienced operator,willing to purchase the property for cash, and purchase the existing business operation under a separate agreement with the owner of the Swallows Inn. 6. A commitment by the Buyer to operate the Swallows Inn business for a period of five years. 7. A commitment by the Buyer to enter into a Cooperative Parking Agreement to be involved in discussions regarding long-term parking improvements in the area. C. Developer's Background - Ralph A. Furra owns and operates three similar establishments in South Orange County. They include Shooters Bar in Mission Viejo, Goody's Tavern in San Clemente, and Woody's Wharf Restaurant in Newport Beach. Mr. Furra will operate and manage the Swallow's Inn, and he recognizes the importance of maintaining the Swallows Inn establishment. Agenda Item • - 4 - • August 18, 1992 ENVIRONMENTAL The City issued a Categorical Exemption for the Disposition and Development Agreement on July 30, 1992. PUBLIC NOTIFICATION The required legal notices of the public hearing were published on August 6, 1992, and on August 13, 1992, in the Capistrano Valley News. Ralph Furra, Tacy Lee, Proctor Stafford, and Jeffrey Hartman were sent a copy of the public hearing notice and this staff report. The Disposition and Development Agreement, the California Community Redevelopment Law, Section 33433 Report, and the Categorical Exemption are on file in the City Clerk's Office. COMMUNITY REDEVELOPMENT AGENCY The project is located within the Central Redevelopment Project Area. The proposed Disposition and Development Agreement meets the goals and objectives of the Redevelopment Plan. OTHER BOARDS/COMMLSSIONS Not applicable. FINANCIAL CONSIDERATION The "Invitation to Bid" process has resulted in a negotiated offer of $500,000 cash for the property. The negotiated price reflects a gain of$126,751 over the original purchase price of $373,249. The Agency and Developer will share in the escrow costs. The Disposition and Development Agreement also provides that the Developer will rehabilitate the building and maintain the improvement in good condition and faithful to the western flavor and historic character. The Developer, under a separate agreement,will also purchase the Swallows Inn business. Agenda Item • 5 - August 18, 1992 ALTERNATIVES 1. By motion, adopt the resolution, and approve and execute the Disposition and Development Agreement with Ralph A. Furra,and authorize the Executive Director, on behalf of the Agency, to sign all documents necessary to carry out and implement the Agreement, to administer the Agency's obligations, responsibilities, and duties to be performed under the Agreement. 2. Direct staff to bring back revisions to the Disposition and Development Agreement. 3. Direct staff to end exclusive negotiations with Ralph A. Furra and enter into negotiations with another Bidder. RECOMMENDATION By motion, adopt the resolution, and approve and execute the Disposition and Development Agreement with Ralph A.Furra, and authorize the Executive Director, on behalf of the Agency, to sign all documents necessary to carry out and implement the Agreement, to administer the Agency's obligations, responsibilities, and duties to be performed under the Agreement. Respectfully submitted, � 0, .. 4Vj�1 Cassandra C. Walker Community Development Manager CLW:rmb attach RESOLUTION NO. CRA 92-8-18-1 APPROVING DISPOSITION AND DEVELOPMENT AGREEMENT FOR THE SALE OF PROPERTY LOCATED AT 31782-31786 CAMINO CAPISTRANO TO RALPH A. FURRA SWALLOWS INN A RESOLUTION OF THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, CITY OF SAN JUAN CAPISTRANO, CALIFORNIA, APPROVING THE DISPOSITION AND DEVELOPMENT AGREEMENT FOR CERTAIN PROPERTY WITHIN THE SAN JUAN CAPISTRANO CENTRAL REDEVELOPMENT PROJECT AREA TO RALPH A. FURRA (SWALLOWS INN) WHEREAS, the Community Redevelopment Agency of the City of San Juan Capistrano (the "Agency"), is engaged in activities necessary to carry out and implement the Redevelopment Plan for the San Juan Capistrano Central Redevelopment Project Areas; and, WHEREAS, in order to carry out and implement such Redevelopment Plan, the Agency proposes to enter into the Disposition and Development Agreement (the "Agreement"), made a part hereof by reference, with Ralph A. Furra (the "Developer") for the sale of the premises (the "Premises") in the San Juan Capistrano Central Redevelopment Project Area, described in the Agreement as approximately 17,133 square feet commonly known as the Swallows Inn and Paisley Penguin with a mailing address of 31782-31786 Camino Capistrano; and, WHEREAS, pursuant to the California Community Redevelopment Law (California Health and Safety Code, Section 33000 et seq.), the Agency and this City held a joint public hearing on the terms of the Disposition and Development Agreement and including the sale of the Premises, having duly published notice of such public hearing and made copies of the proposed Agreement available for public inspection and comment; and, WHEREAS, the Agency has duly considered all terms and conditions of the proposed Agreement and believes that the redevelopment of and sale of the Premises thereof is in the best interest of the City of San Juan Capistrano and the health, safety, and welfare of it residents, and in accord with the public purposes and provisions of applicable State and local law and requirements; and, WHEREAS, the proposed Disposition and Development Agreement was determined by the Planning Director to be Categorically Exempt pursuant to California Environmental Quality Act Guidelines (CEQA), Class 12, on July 30, 1992. NOW, THEREFORE, BE IT RESOLVED, by the San Juan Capistrano Community Redevelopment Agency, City of San Juan Capistrano, California as follows: 1. The Agency has received and heard all oral and written objections to the proposed Agreement and to the proposed sale of the Premises and to other matters pertaining to this transaction, and that all such oral and written objections are hereby overruled. -1- 2. The Agency hereby finds and determines that the consideration to be paid by the Developer for the sale of the Premises is in accordance with the covenants and conditions governing such sale. The Agency hereby further finds and determines that alt consideration to be paid under the Agreement is in an amount necessary to effectuate the purposes of the Redevelopment Plan for the San Juan Capistrano Central Redevelopment Project. 3. The Categorical Exemption issued on July 30, 1992, adequately considered all environmental impacts potentially caused by the proposed sale of Premises as there are no substantial changes relating to the proposed sale which would alter the determination that the project is exempt under CEQA Guidelines, Class 12, Section 11532. 4. The sale of the Premises and the proposed Agreement, which establish the terms and conditions therefore, are hereby approved. 5. The Chairman of the Agency is hereby authorized to execute the Agreement on behalf of the Agency. A copy of the Agreement, when executed by the Agency, shall be placed on file in the office of the Agency Secretary. 6. The Executive Director of the Agency (or his designee) is hereby authorized on behalf of the Agency, to sign all documents necessary and appropriate to carry out and implement the Agreement and to administer the Agency's obligations, responsibilities and duties to be performed under the Agreement, and related documents. PASSED, APPROVED, AND ADOPTED this 18th day of August , 1992. AKENNETHE . FRIESS, CHAJRMAN ATTEST: AGENCY SECRE RY -2- AFFIDAVIT OF PUBLICATION Space below for Filing Stamp Only STATE OF CALIFORNIA COUNTY OF ORANGE I am a citizen of the United States and a resident of the County aforesaid. I am over the age of eighteen years,and not a party to or interested in the above entitled matter. I am the principal clerk of the Proof of Publication of Capistrano Valley News, a newspaper that has been adjudged to be a newspaper of general circulation by the Superior Court of the County of Orange, State of California, on .lune 7, 1984, Case No. ,NOTICE OF PUBLIC HEARTNG A-122949 in and for the City of San Juan Capistrano, County of ..................I.........- - Orange, State of California;that the notice,of which the annexed is .. a true printed copy, has been published in each regular and entire issue of said newspaper and not in any supplement thereof on the following dates, to wit: "JOINT PUBLIC HEARING.CITY Of ,/,VAN CAPISTRANO ANDTHE SAN CAPISTRANO COMMUNITY August 6, 13, 1992 REDEVELOPMENTAGENCY . DISPOSITIONANDDEVSI.O' : AGREEMENT(SWALLOWS I is EZRWY GIVEN,that GUY 1i"a UW I declare under penalty of perjury that the foregoing is true and Re e"10FUe (the.I and the P b 0 9 9 aad"a pnaet A it tree"Apeq"1- correct. head"m Auaotl>a I.14"� brulty a the emtter eaabe head bw,DOY S, aaaro aeeo pyaya,ppnpantbtha � OeAdl tSabty rade t9 Of itlr. we of neaelMAgre tha t(ft" d h rhpPpp�d beeetePeapt Apealpmt(tea" Executed at Mission Viejo, Orange County, California,on �J "DaieI.P.') hkb PrO"' 'T�t( ,mWlenanee and t* 040111kiI k.. August 13, 1992 P>®pr&+dne for the .lpaatom . ............................................................................... loan C+pYtrano Cowmuphy aatltlwYp"A Yanterieg auto aeeparaYwlth Im to punhne the I adp rvis eeNNHe tbabuiWleeaatr�attMrY need �te.Re wW motYm 011e+0 Or a ............................................................................................................. pnrpaee ofthe pblie eturipaYbmYidpr: (Signature) `f,the propp.e we of theeMesMYAwtM no Centre HoApvpYPeteuI Frym4Ar"Mhhl dereloPer Por the rehWOt4ttop We ora mmearcipt use. E.The document provMW 4/uM aW posedce tbb and Daeelppglt a.AI)evidencienne and Ys NmoglhrpddaoaYM the t need tae PeOPead YY dthe A. not �arhy time nolLter turn a ho�Nn 04ad ibM person ob)repa s to the prdpoesd Nla e(flm iMMt,or to the the CofanYptWi%rte tms with the CkCity lash a etaYgeet df hY tw .Any Y nee or+urYatWa theM1e t,efore the Agepey and th tmd Capistrano Valley News the aveementAt er M ofMaeUa (A Publication of South Orange County News) p in he' psaw UMPM 811 23811 Via Fabricante "bllowipg doeemen4 am ayaOWYPer pphac P. O. Box 3629 durYsrM dpcnmeemeeeta�d°m bsp°p. Friday)at the.mm of ibe City CYrk and Mission Viejo, California 92690 City Hart aa.00FneeoAdelanta.SMJum 714 768-3631 Pis` J copy ofthe aQeemept between the Sm Jum Commrtmty Aederotopummat Asenry. Clty Of Capietrauo,CeifernY a.dsa)ph A.Fum. +..f'.•.}:;,'.. `-.Y:'ASW=WYRepartehiehdeeerle` W ,e a.The nest oftMaarooment b.The eeti"W mare of the eeftst to datenmmed at the hf9beal u PerleProject d ' Flan br the Central 1;An e.AA CW ad the GYanr7nel ffi®Mbp ipblyMiYp you ma embtd the Aaseyatf44171. CHERYL OMMON. STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss CITY OF SAN JUAN CAPISTRANO ) 1, CHERYL JOHNSON, Secretary of the San Juan Capistrano Community Redevelopment Agency, DO HEREBY CERTIFY that the foregoing is a true and correct copy of Resolution No. CRA 92-8-18-1 adopted by the Board of Directors of the San Juan Capistrano Community Redevelopment Agency, at a regular meeting thereof held on the 18th day of August , 1992, by the following vote: AYES: Directors ilausdorfer, Jones, Harris, Vasquez, and Chairman Friess NOES: None ABSTAIN: None ABSENT: None (SEAL) CHERYL JO EN Y ECRE Y -3- NOTICE OF TRANSMITTAL - LEGAL PUBLICATIONS TO: CAPISTRANO VALLEY NEWS Bea Gougeon, Legal FOR PUBLICATION ON: THURSDAY, AUGUST 6, 1992 THURSDAY, AUGUST 13 , 1992 DOCUMENT TO BE PUBLISHED: NOTICE OF JOINT PUBLIC HEARING - PROPOSED DISPOSITION AND DEVELOPMENT AGREEMENT (SWALLOWS INN/FURRA) FOR PUBLICATION ON: Please send to: City Clerk's Division City Hall 32400 Paseo Adelanto San Juan Capistrano, California, 92675 (714) 493-1171 AUTHORIZED BY: C DATE: July 30, 199 Date of Public Hearing - 08/18/92 Date notice published - 08/06/92 - 08/13/92 Date affidavit received - 611.7�9a — Date notice posted in designated posting places (3) - 08/06/92 Date notice posted on property - N/A Date of mailing notice to interested parties - 08/06/92 Date notice transmitted to City Manager' s Office - 07/30/92 noticAf irn PL BLIC HEARING CITY OF SAN JUAN CAPISTRANO JOINT PUBLIC HEARING CITY OF SAN JUAN CAPISTRANO AND THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY PROPOSED DISPOSITION AND DEVELOPMENT AGREEMENT (SWALLOWS INN/FURRA) NOTICE IS HEREBY GIVEN, that City Council of the City of San Juan Capistrano (the "City") and the San Juan Capistrano Community Redevelopment Agency (the "Agency") will hold a joint public hearing on August 18, 1992, at the hour of 7: 00 p.m. or as soon thereafter as the matter can be heard, in the City Council Chamber, City Hall, 32400 Paseo Adelanto, San Juan Capistrano, California 92675, pursuant to the California Community Redevelopment Law (Health & Safety Code Sections 33000 et. seq. ) for the purpose of considering the approval of a proposed Disposition and Development Agreement (the "Agreement") with Ralph A. Furra (the "Developer") which provides for the sale of the site at 31782-31786 Camino Capistrano to the developer for the rehabilitation, maintenance and operation of the existing Swallows Inn business. The proposed plan provides for the purchase of the site from the San Juan Capistrano Community Redevelopment Agency. The developer is entering into a separate agreement with the owner of the Swallows Inn to purchase the business and name. The developer will rehabilitate the building as necessary and make minor improvements. He will continue the operation of the Swallows Inn business. The purpose of the public hearing is to consider: 1. The proposed sale of the site in the San Juan Capistrano Central Redevelopment Project Area by the Agency to the developer for the rehabilitation and continued operation of a commercial use. 2 . The document providing for such sale which is the proposed Disposition and Development Agreement. 3 . All evidence and testimony for and against the approval of the Agreement and the proposed sale of the site to Ralph A. Furra. Joint Public Hearing Swallows Inn Page 2 At any time not later than the hour aforesaid set for the hearing, any person objecting to the proposed sale of the site, or agreement, or to the regularity of any of the prior proceedings may file in writing with the City Clerk a statement of his or her objections thereto. Any persons or organizations desiring to be heard may appear before the Agency and the City Council and show cause why the agreement or the proposed sale of the site should not be approved. At the aforesaid hour the City Council and the Agency shall proceed to hear and pass upon all written and oral objections. The following documents are available for public inspection and copying during regular office hours (8 :00 a.m. to 5: 00 p.m. , Monday through Friday) at the office of the City Clerk and Secretary of the Agency, City Hall, 32400 Paseo Adelanto, San Juan Capistrano, California 92675: 1. A copy of the agreement between the San Juan Capistrano Community Redevelopment Agency, City of San Juan Capistrano, California and Ralph A. Furra. 2 . A Summary Report which describes and specifies: a. The cost of the agreement to the Agency. b. The estimated value of the interest to be conveyed, determined at the highest uses permitted under the Redevelopment Plan for the Central Redevelopment Project Area. C. A copy of the Categorical Exemption issued by the Planning Director. For further information you may contact the Community Redevelopment Agency at 493-1171. CHERYL JC CI Y LERI FOR OFFICE USE ONLY: STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss. AFFIDAVIT OF POSTING CITY OF SAN JUAN CAPISTRANO ) AND PUBLICATION I, CHERYL JOHNSON, declare that I am the duly appointed and qualified City Clerk of the City of San Juan Capistrano; that on August 6, 1992 , I caused the above Notice to be posted in three (3) public places in the City of San Juan Capistrano, to wit: City Hall; Old Fire Station Recreation Complex; Orange County Public Library AND, that on August 6, 1992 , and August 13, 1992 , the above Notice was published in the Capistrano Valley News newspaper. I declare under penalty of perjury that the foregoing is true and correct. �Dry.4 CHERYL LY JOHNSON, CITY CLERK City of San Juan Capistrano California Public Hearing MAIL List Swallows Inn Mr. Ralph A. Furra c/o Woody's Wharf 2318 Newport Blvd Newport Beach, CA 92663 Proctor Stafford c/o R. Brundage Inn Robert B. Hamilton 34080 Golden Lath, Suite 302 Dana Point, CA 92629 Mr. Jeffrey A Hartman 567 San Nicolas, Suite 308 Newport Beach, CA 92660 Taey Lee Swallows Inn 31786 Camino Capistrano San Juan Capistrano, CA 92675 CENTRAL REDEVELOPMENT PROJECT AREA SAN JUAN CAPISTRANO, CALIFORNIA SUMMARY PERTAINING TO THE DISPOSITION AND DEVELOPMENT OF CERTAIN REAL PROPERTY RALPH A. FURRA (California Community Redevelopment Law, Section 33433) San Juan Capistrano Community Redevelopment Agency August 1992 QOMMUNITY REDEVELOPMENT IAW 33433 REPORT 31782 - 31786 CAMINO CAPISTRANO I. INTRODUCTION The Redevelopment Agency of the City of San Juan Capistrano, California (the "Agency") is considering the sale of certain real property in the Central Redevelopment Project Area to Ralph A. Furra (the 'Developer")pursuant to a proposed Disposition and Development Agreement (the "Agreement") between the Agency and the Developer. The proposed property to be sold to the Developer, subject to certain conditions, consists of the Premises shown on the map attached hereto as Attachment #1. The site consists of approximately 17,133 square feet and has one approximately 3,600 square feet building commonly known as the Swallows Inn/Paisley Penguin and adjacent parking. This summary is prepared in accordance with Section 33433 of the California Community Redevelopment Law, which describes and specifies: A. The cost of the Agreement to the Agency; B. The estimated value of the interest to be conveyed to the Developer, determined at the highest uses permitted under the applicable Redevelopment Plan; C. The purchase price of the property which the Developer will pay. If the sales price is less than the fair market value of the property, the Agency shall provide an explanation of the reasons for the difference. Property Location The property is located at 31782-86 Camino Capistrano. The Assessors Parcel Number is 124-160-021. II. THE COST OF THE AGREEMENT TO THE AGENCY The Agency acquired the Swallows Inn and Paisley Penguin property in 1985 from the Olivares Estate for $373,249. The property was originally purchased in anticipation of the commercial/retail development of the Historic Town Center area. The sales price is $500,000, which reflects a gain of $126,751 over the original purchase price. III. ESTIMATED VALUE OF INTEREST TO BE CONVEYED AT THE HIGHEST USES PERMITTED UNDER THE REDEVELOPMENT PLAN This section presents an analysis of the fair market value of the site at its highest and best use. The proposed use of the site must be consistent with the Redevelopment Plan. • The highest and best use can be defined as the legal use (allowed under the Redevelopment Plan) that will yield the highest value. Therefore, the definition of highest and best use is based solely on the value created and not on whether or not it enhances or carries out the redevelopment goals and policies for San Juan Capistrano. In June of 1992, the Agency had an appraisal prepared for the property. Three methods of evaluation were used to determine the highest and best use. These methodologies are as follows: Income Capitalization $662,000 Replacement Cost $573,000 Sales Comparison - Land Value $536,000 with Adjustments $660,000 Based on these methods, the fair market value of the property was determined to be $660,000. IV. PURCHASE PRICE OF THE PROPERTY AND DISPOSITION AND DEVELOPMENT AGREEMENT CONDITIONS The Agency went through a lengthy 'Invitation to Bid" process to select a purchaser for the property. Brochures were mailed out to over 500 interested parties. The property was advertised in several publications including the Los Angeles Times, The Orange County Register, Daily Sun/Post, National Trust for Historic Preservation Newsletter, and the Society for Architectural Historians Newsletter. The Agency received three bids in response to the 'Invitation to Bid'. The bids ranged in value from $395,000 to $500,000. Of primary consideration in selecting a purchaser for the building was the desire of the new owner to continue the Swallows Inn use and maintain and rehabilitate the structure. The Agency also expected the purchaser to enter into a Cooperative Agreement to discuss the long term parking improvements in the area. Through a negotiation process, Ralph A. Furra was selected as the proposed purchaser of the property. The Disposition and Development Agreement provides for the following: 1. Purchase Price of $500,000 2. Purchase of the Swallows Inn business and name and commitment to continue its operation for a period of five years. 3. Execution of a Cooperative Parking Agreement which outlines discussion issues for cooperation regarding parking improvements in the area. The negotiated sales price is less than the fair market appraisal of the property. The original offer was for$400,000. The Executive Director has negotiated the offer to$500,000 and recommends that the Agency approve this sales price for several reasons. 1. The Agency went through a lengthy and comprehensive "Invitation to Bid" process to select a purchaser for the property. This offer equals the highest bid amount. 2. The offer indicates and the Disposition and Development Agreement requires that the Developer purchase the Swallows Inn business and name. The continued operation of this historic community landmark has an undetermined value and benefit to the community. 3. The appraisals are at highest and best use. The existing facility is in need of significant rehabilitation including a new roof, upgraded plumbing, heating, air conditioning, electrical, and restroom facilities. The Developer will purchase the property in an "as is" condition. 4. The appraisal value was also based on the fair market rent. The current rental market in the community is depressed. Several developers are trying to lease facilities at this time. The current rental rates for the Swallows Inn and Paisley Penguin are below fair market value. There is some question regarding the ability of the current businesses operations to afford higher rents based on current market conditions. 5. The current real estate market is slow. The proposed offer facilitates what the Agency was trying to accomplish. An experienced operator, willing to purchase the property for cash, and the purchase of the existing business operation under a separate agreement with the owner of the Swallows Inn. 6. A commitment by the Developer to operate the Swallows Inn business for a period of five years. 7. A commitment by the Developer to enter into a Cooperative Parking Agreement to be involved in discussions regarding long-term parking improvements in the area. J J • SrREEr 1 f DEL � a 0 .� w i•.: MWr 1 It 1 IRK 1 1 . 1 •rl � t �1 air J L • ^ IItJ ; ' + 1 OR7o v ® r i eJI r. ® ap n d At;. v • ILE a ® 1 b ( It Ac ' }I V � o ( .• .� �� A, br.,, MA •; EL � t71ANlt9 � � � REAL• J.- 'I) -��-'' � N a MD 105 w Mo Ora • � _�.r © e ALS a .4160 1 J . ' too r.l.wlr Avrf- ASslXtws Apff a ASSMOO'S MAI CAMIOW 1,E1 _ 15 0 PARCEL NWIOM IOOK12AM6E16 �GAWN 1931 SNOM'N ANVIRCLES couNrr OF mow MS, SAN .WN I„•AFISMAW. A'SP-33 1 �� City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 (714) 493-1171 NOTICE OF EXEMPTION 1. APPLICANT: Community Redevelopment Agency (CRA) , City of San Juan Capistrano 2 . ADDRESS: 32400 Paseo Adelanto, San Juan Capistrano, CA 92675 3. PHONE NUMBER: (714) 493-1171 4 . LEAD AGENCY: City of San Juan Capistrano 5. PROJECT TITLE: CRA, Swallows Inn, Property Sale/Lease. 6. DESCRIPTION: The City's Community Redevelopment Agency owns property in the downtown area including the "Swallows Inn" , a 4,200 square foot structure presently used as a tavern on an 0. 35 acre parcel. The property is situated along the east side of Camino Capistrano at the intersection of Verdugo Street, and is General Planned 113 . 1, general commercial" and zoned "CG" (general commercial) . The City proposes to sell the Swallows Inn property to a private party. The sale has been subject to a public bid process administered pursuant to State law. ADMINISTRATIVE DETERMINATION: Planning Department staff have completed a preliminary review of this project in accordance with the City of San Juan Capistrano's adopted guidelines for implementing the California Environmental Quality Act (CEQA) of 1970. Based on that review, the Planning Director finds that the proposed project constitutes the sale of surplus government property which qualifies as a categorical exemption under the provisions of CEQA. Therefore, the Planning Director has determined that further environmental evaluation is not required because: [ ] The proposed project does not constitute a "project" as defined in the CEQA Guidelines (Section 15378) , or [ ] The project is ministerial (Section 15300. 1) , or [ J The project is a declared emergency (Section 15269) , or [X] The project is categorically exempt, Class 12 (Section 15312) . [ ] The project could not possibly cause a significant effect on the environment (Section 15061(b) (3) ) . Date: July 30, 1992 Th as Tomlinson, P1 ng Dire for (C:\WP50\SP2\CRASWA E) r %RRVt)n '� S I wrrnn�' �rrl lnnrmrn _ San Juan Capistrano Community Redevelopment Agency October 8, 1992 Mr. Ralph A. Furra 1418 West Bay Avenue Newport Beach, California 92661 Re: Cancellation of Disposition and Development Cancellation of Disposition and Development Agreement - Swallows Inn- Swallows Inn Dear Mr. Furra: At their regular meeting of October 6, 1992, the San Juan Capistrano Community Redevelopment Agency and the San Juan Capistrano City Council both adopted resolutions approving the cancellation of the Disposition and Development Agreement for the property located at 31782-31786 Camino Capistrano, otherwise known as the Swallows Inn. Copies of Resolution No. CRA 92-10-6-2 and Resolution No. 92-10-6-4, setting forth the approvals, are enclosed for your files. The Good Faith Deposit of $50,000 will be returned to you. Thank you for your interest in being a part of San Juan Capistrano. Very truly yours, 04�— Cheryl Johnson Agency Secretary Enclosure cc: Jeffrey Hartman Tacy Lee Proctor Stafford Executive Director Finance Officer Julia Kimminau 32400 Paseo Adelanto San Juan Capistrano California 92675 714-493-1171 RErV3 JEFFREY A. HARTMAN S°"P, I A Professional Law Corporation Telephone (714) 644-2002 567 San Nicolas,Suite 308 Fax (714)721-8316 Newport Beach, CA 92660 September 16, 1992 Community Redevelopment Agency of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 ATTN: Kenneth E. Friess, Chairman RE: Termination of Disposition and Development Agreement by and between the San Juan Capistrano Community Redevelopment Agency and Ralph Furra Dear Mr. Friess: This office has been representing Ralph Furra in his attempt to acquire the Swallows Bar in the building located at 31786 Camino Capistrano, which is the subject of the above described agreement. I have been working with Mr. Ralph Furra and Mrs. Tacy Lee to accomplish the transaction described in the Agreement. Due to several reasons, the acquisition of the Swallows Bar cannot be accomplished. We would appreciate it if you would send the Good Faith deposit to my client's office, which is located at 2318 Newport Blvd., Newport Beach, CA 92663. Thank you in advance for your cooperation on this matter. Very truly yours J A. tman JAH:db cc: Ralph Furra Tacy Lee gllal9� S. �ulL+cw�- SEF 1 7 1992 X S/o�S 0 0 MEMORANDUM September 1, 1992 TO: Cheryl Johnson, City Clerk FROM: Stephen B. Julian, City Manager SUBJECT: Furra/CRA Disposition and Development Agreement Please note that the entire Disposition and Development Agreement should be recorded, including the Parking Agreement. Thank you, SBJ:mjs x San Juan Capistrano Community Redevelopment Agency August 24, 1992 Mr. Ralph A. Furra c/o Jeffrey A. Hartman 567 San Nicolas, Suite 308 Newport Beach, California 92660 Re: Sale of Swallows Inn Property - 31782-31786 Camino Capistrano Dear Mr. Furra: At their meeting of August 18, 1992, the Community Redevelopment Agency and the City Council held a joint public hearing regarding disposition of the Swallows Inn Property. Following that hearing the Agency Board and the City Council adopted resolutions approving the Disposition and Development Agreement. Copies of the Agency's Resolution No. CRA 92-8-18-1 and the City's Resolution No. 92-8-18-8 are enclosed for your files. The Agency Chairman was authorized to execute the Disposition and Development Agreement following completion of the real estate disclosure statement and resolution of the parking easement rights issue. When the Agreement has been executed by the Agency, a copy will be forwarded to you. If you have any questions, please do not hesitate to call. VerX truly yours,(//\ Cheryl Johnson Agency Secretary Enclosure cc: Tacy Lee Jeffrey Hartman Proctor Stafford Community Development Division 32400 Paseo Adelanto San Juan Capistrano California 92675 714-493-1171 n JEFFREY A. HARTMAN n A Professional Law Corporation j _ Telephone (714)644-2002 567 San Nicolas,Suite 308 Fax (714) 721.8316 Newport Beach, CA 92660 A- August 7, 1992 Ms. Cassandra Walker Community Development Manager City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 Dear Ms. Walker: Enclosed please find five (5) signed and notarized, original Disposition and Development Agreements by and between the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, and RALPH FURRA. Very truly yours, 9V QJ/ Jeffrey A. Ha tman JAH:db 41 Enclosures -1�. 1 E IVb • i Cpl 11/y rOF +\ HIS` ORIC SAN` JUAN CAPISTRANO �Uo / Post Office Box 1645 OSan Juan Capistrano, California 92693 (714) 496-1846; Fax 496-0015 August 3, 1992 Ms. Cassandra Walker Community Development Manager City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, California 92675 Dear Cass: Thank you for returning my call last Tuesday concerning the status of the upcoming Historic Town Center city council agenda item. I wanted to follow-up and confirm with you that the item will, in accordance with Council's April 21, 1992 action, provide an economic analysis of both the HTC Ad Hoc Committee's May 21, 1992 recommended plan and the November 3, 1987 Oliver McMillan plan. Following our conversation, I reviewed to the Disposition and Development Agreement (DDA) between the redevelopment agency and Oliver McMillan Capistrano I, Ltd. and concur that it provides an excellent basis for your analysis of this project. In particular, Attachment No. 6 of the DDA itemizes the Agency's obligation under IV. AGENCY PUBLIC IMPROVEMENTS (relocation of public facilities, relocation of existing tenants, and construction of public improvements); Attachment No. 7 spells out the Agency's obligation to provide the project property and improvements "secured" by a subordinated Agency Note in the amount of$5,000,000.00 underwriting the guaranteed Net Operating Income of the project. In addition, any valid economic analysis of the Oliver McMillan DDA will, no doubt, provide a current market occupancy and income forecast. To the extent that the Agency would be underwriting the success, or failure, of the project during a severe recession and real estate slump, the Oliver McMillan analysis should also include adequate discussion of the Agency's downside risk should the project fail and become insolvent. Precisely, what are the likely risks to the municipality and the taxpayer in the event that the entire project, or for that matter the "high intensity anchor" component (hotel), fails and causes the limited partnership to default on its obligations? "Ms. Cassandra Walker l Community Development Manager August 3, 1992 Page Two Another aspect of the former redevelopment plan that would be helpful to the public would be information on Oliver McMillan Capistrano I, Ltd. Since limited partnerships are by nature and corporate designation limited in terms of ultimate liability, information beyond a mere prospectus is essential in determining risk to the redevelopment agency and the municipal treasury. Additionally, since the Oliver McMillan project has been out-of- process so long, a discussion of its review history(Schedule of Performance) and remaining valid resolutions, if any, would be helpful. As it stands now, our understanding is that this agenda item will appear no sooner than August 18, 1992. At such time that the staff report for the agenda item is available for distribution, will you be sending the Steering Committee members a copy? Thank you very much Cassandra. Sincerely, Friends of Historic San Juan Capistrano CLL�L- Mark B. Clancey, President Historic Town Center Steering Committee Member cc: City Clerk #�a�� AY�?f 8id��b • • • ek bM i b �Ob9Pn& @6fCb@atr �3�b49W. weighed in making a recom- Proposal "� projected date of Purchase Deposit-A 10% mendation to the Board. T'hey- StVWssion occupancy deposit of the proposed PVT- _ are: Requirements 3.A business chase price in the form of 1.Business/Development In response to the development plan cash,a cashier's check,or experience of purchaser. Invitation to Bid each Pur- for the proposed enterprise money order will be required 2.Management/Operation chaser must submit seven l- including should inc The from the Purchaser selected Swallows Inn For Sale experience. packages containing the fol- pro-forma should include for exclusive negotiations of 3.Intended use of the lowing information: specific information about any the final terms and conditions facility and any long term renovation costs,capital costs of the sale. r San Juan s favorite watering hole goes on the market associated with the The 10%deposit will be renovation,start- due within 24 hours of the up costs for the selection of the Purchaser by new facility,anfici- the Agency.This money will be pated taxable and deposited in escrow as a non- non-taxable sales refundable deposit if escrow is projections,and not completed in accordance gross and net with the final terms and condi- revenues. tions of the sale as approved Purchaser and accepted by the Agency. Qualifications- _ - 1.Identification Submission Deadlineof the type of legal All responses to this Invita- entity with whom tion to Bid shall be submittedthe Agency would to the San Juan Capistrano enter negotiations. Community Redevelopment - - � � I improvement. Purchase Offer-including 2. identification of the Agency to the attention of F i 4.Financial terms of the the following three items. Purchaser including all joint Cassandra Walker,Community offer. 1.A narrative description of venture or limited partners Development Manager,at 5. Other information may be all proposed terms and condi- and percentage of interest. 32400 Paseo Adelanto,San submitted which provides a tions of the sale,including 3. The Purchaser's previous Juan Capistrano, Callformia, he San Juan Capistra- Hoosegow Day,die Return of The Downtown-The City Swallows Inn,with its five better understanding of the purchase price,proposed fi- relevant experience in similar 92675.The Invitation to Bid no Community Rede- the Swallows,and Rancho of San Juan Capistrano is screen Edwards theater and a qualifications of the purchaser. nancing, source of ten percent ventures. responses will be accepted velopment Agency is Days to name a few. home to Mission San Juan 352 space parking structure, Selection Process-Agen- deposit,acknowledgment of 4.Evidence that the Pur- until 5:00 p.m. on Wednesday, Tpleased to announce To visit the Swallows Inn is Capistrano,founded in 1776 has boosted the Downtown cy staff will make a recom- building condition,outline of chaser (including joint ven- June 24,1992. that it is seeking a Buyer with to step back in time to a true as the seventh mission of the nightlife.Franciscan Plaza also mendation to the Agency proposed seller and buyer tore partners) has the finan- A Purchaser,by submitting a unique approach and western bar.The worn wood California chain.The Mission includes close to 21,000 Board of Directors regarding costs, statement of your long cial capability to undertake the a response to this Invitation to creative sensitivity to historic dance floor has seen the boots is in the heart of the Historic square feet of commercial the proposal or proposals to term community commitment, purchase.Business and Bid waives all rights to protest structures to purchase the of many saddle-sore riders, Downtown-also home to the space with tenants such as accept for final negotiation at and schedule for conclusion of personal financial statements or seek any legal remedies Swallows Inn,a famous San (and a few horse shoes,too). Swallows Inn.Several recent Ruby's Diner and Sloan&Kat- their attheir first meeting in July. transaction within 30-60 day for the prior two years must whatsoever regarding any as- Juan Capistrano landmark. The walls and ceilings are projects in the downtown have cef,inc. Phase 11 of Franciscan Once the terms and conditions escrow period. be included in the submittal. pect of the Invitation to Bid This downtown bar has fined with posters,street- brought revitalization to the Plaza is scheduled to open this of the sale are completed,a 2. If a change in use or sig- 5. identification,role,and process,the Agency's selection become an institution in the signs,newspaper clippings area.The San Juan Capistrano spring and will add close to Public Hearing will be sched- nificant modification to pre- experience of key individuals of an offer or rejection of any community and has a loyal and items significant to the Depot recently underwent an 18,000 square feet of com- uled to make public those sent use is proposed,the pur- that will be involved in the and all offers,and subsequent clientele that reflects the history of the bar,its patrons, extensive upgrade and remod- mercial space. terms and conditions.it is an- chase offer should include a sales transaction and opera- sale that might be entered into town's rural character and tra- and the community.The elmg effort,enhancing the Historic Town Center- ticipated that the Public Hea- narrative description of the bon/management of the facility as a result of this process. ditions. In addition,the Swallows is a place where facility for Amtrak passengers (see map) Originally planned ring will be scheduled for the proposed use,a description of when purchased. Swallows Inn is patronized in people make new friends and and bringing a first-class as a commercial development first meeting in August An proposed change in the physi- 6.Purchaser references Information conjunction with many events see old friends over the din of south-west cuisine restaurant for the Downtown,the discov- escrow of 30-60 days will cal characteristics,estimated including at least four,with For information contact associated with the community a Eve country band or the roar to the facility. ery of significant archaeolog- follow for conclusion of the cost of renovation,a schedule contact name,address and Cassandra Walker or David including the Heritage Festival of the jukebox. Franciscan Plaza,located ical features on this site transaction. of performance, and phone number. Bentz at (714)493-1171. and parade,the Portola Ride, across the street from the caused the formation of a S A N J U A N C A P I S T R A N 0 C 0 M M U N I T Y R E D E V E L O P M E N T A G E N C Y S A N I U A N C A P I S T R A N 0 C 0 M M U N I T Y R E D E V E L O P M E N T A G E N C Y = : SEE Steering Committee to will need to be ad- to facilitate parking consistency of improvement Commercial Potential offers for the pur- " purchase of the will provide an opportunity to formalize recommendations dressed depending and pedestrian and maintenance. Economic Potential-The chase of the Swal- building.We will discuss offer requirements pertaining to the future use of on the nature of any circulation. Development Guidelines Swallows Inn has excellent lows Inn building. not retain any own- and address questions to the the site.The Steering Commit- proposed use The second re- While the building itselfmay economic potential relating to The Agency would ership or financial City regarding plans for the tee's Concept Plan outlines the changes,modifications,or striction applies to the future not be architecturally signiB- its location in downtown San encourage the Purchaser to involvement with the facility. area.'the walls-through will be development of an Historic expansion to the existing realignment of Ortega High- cant to the downtown area,the Juan Capistrano;its adjacency retain the present use. The The Agency is looking for fair held on Thursday,May 28,at Town Center Archaeological building.The building may re- way.The realignment of the design and location of the to the Mission,the Railroad Agency desires an offer which market value in conjunction 2 p.m.outside 31786 Camino Park which will both preserve quire reroofing in the near highway will provide for a structure are crucial to main- Depot with over 300,000 will provide the appropriate with a short escrow process. Capistrano.Those interested and further explore the future,but does not require Mission Forecourt pedestrian taining the "village-like down- patrons annually,and the new economic return on the Summary of Existing in submitting an offer w ll have cultural features of the site, any seismic retrofitting.Other area between the Mission and town"that San Juan Capistrano commercial development Agency's investment.The pro- Leases-The Swallows Inn an opportunity to see the and provide a park area for items relating to the environ- the EI Peon Complex.Signifi- is known for.Massing and across the street.The world perry was purchased in 1985 curremty has two tenants on layout of the building. community activities and civic mental assessment famous"Return of the for$373,249 for inclusion in standard month-to-month Qualification Phase- events.The plan also provides of the building will Swallows" occurs each year in the Historic Town Center pro- leases.The monthly rental for Agency staff intends to recom- for the realignment of Ortega need to be Much as visitors travel to the jest.In July 1990,a prehmi- the Swallows Inn is$2990 and mend the most qualified offer Highway.A Master Plan for the addressed by the City for the week-long celebra- nary value estimate indicated a $625 for Paisley Penguin.The based on information submit- implementation of the park purchaser. tion and parade.other events market value of$650,000.The Agency owns onTy the site in ted in the response to this based on the Concept Plan will Uses-The Somal- are sponsored quarterly by the Agency acknowledges this was which the Swallows Inn and Invitation to Bid.All competi- be prepared by the City.The lows Inn is located Merchants Association.The not a full appraisal of the Paisley Penguin are located. dve offers will be presented to Purchaser should not rely on in the Tourist Com- Downtown is the shopping property,nor does it reflect the Agency Board of Directors. the ultimate development of mercial zoning dis- center of the City and provides the presence of new develop- Purchaser Selection Process They will then select the most the area as depicted on the trio which allows . goods and services for resi- ment in the area. Walk Through-Interested responsive offer and enter into Concept Plan as changes to the tourist-oriented �` dents and visitors. The Agency will be most Purchasers will be requested exclusive negotiation for the&- Plan may occur during the retail,small scale Primary Objectives-The responsive to offers which to attend a pre-proposal walk- nal sale terms and conditions. planning process. retail,restaurant Agency is entertaining all provide a straight forward through.The walk-through Several relevant factors will be /bar,lodging and - Site Description general office uses f a Mt _ o 0 History-The swallowsinn includingmedical Historic Town Censer S v, building was constructed circa and dental.Any use Concept Plan* Ilmina 1935 and has a brick and which includes live cant improvement in down- architectural style of adjacent sanjaan concrete block exterior.The entertainment will be subject town circulation is expected structures would have to be Capistrano _0 o eWp uwe - i �pHVGN H structure has always housed a to a Conditional Use Permit Pnu„a from this action.The pro- considered in designing a new ax FORKOURT Pyyl 11141EVI �EQ restauranWar, although the Community expectation is that posed alignment may require structure. J^u name has changed over time. the Purchaser will maintain the removal of a 150 square A new building or modifica- Railroad ' Pmwenui Depot D PPivui}. asieuvsei Q0. Ownership of the site can be the current use. foot section of the northwest tion to the exterior of the ex e, r �o iasnt traced to one of the City's Restrictions-There are corner of the building.To isting structure vzll require o ”' SITE o prominent fatuities,the Egans, three main restrictions which facilitate use of this area for the project go through the Los Rios [env swmuws - Historia PJJA RLIAnFPHIS 1 Condition-The current will apply to the purchase of realignment,the Agency may City's Design Review Process. � INN EO ^� District Franciscan N[a_a '�—r� n�Do I tenant has occupied the build- the Swallows.Flexibility must require an easement or other All development,engineering, ,o„ ,a,„„ ��;;,�� an ing since 1978 The adjacent be maintained for the develop- legal mechanism. and building fees and permits a„g „„,a„s _ ~ „a,56 PfRCIxG „P[INl Paisley Penguin retail space meet of future public parking The third restriction applies will be the responsibilityof the (ARAE[ r / A DISINe (I wF � oUESIRIAN has been n the building since lots and the circulation be- to easement dedications for Owner. o �J Y[nf9RP PWA >Hnr 1985.The site is approximate- [ween them.The Agency will the improvement of public Any change or expansion to Historic Town PdRORM 5MULCIAI PARAi�6 wsuiuui ly 15,320 square feet with a 30 therefore require a permanent sidewalks in front of the build- the existing uses may require os a„ , space parking lot;building easement or other form of ing.Throughout the down- additional parking.The City rd P size is 3,350 square feet. dedication to ensure that the town, sidewalk areas are both willentertain an in-lieu fee for „O,, There have been no substan- 30 space parking tot at the in private and public owner- the provision of additional = Ott anA a,`s� , tial renovations to the facility rear of the Swallows Inn is ship.The Agency,working parking that cannot be pro- ', sa„v„aa and the condition of the cies- used as public puking and with the City,would like to vided on site.This in-lieu fee trical,plumbing,HVAC,and can be redesigned or modified coordinate the public owner- will be based on the improve- `E'An ” IS handicap accessible upgrades at the discretion of the Agency ship of the sidewalks to ensure meat of a nearby parking lot. P PoseabyThe lHCSteering Committee '„S S A N J U A N < A P I S T R A N 0 C 0 M M U N I T Y R E D E V E L O P M E N T A G E N C Y S A N J U A N C A P I S T R A N 0 C 0 M M U N I T Y R E D E V E L O P M E N T A G E N C Y DRAFT DISPOSITION AND DEVELOPMENT AGREEMENT by and between the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, Agency, and RALPH FURRA Developer . DRAFT July 31, 1992 TABLE OF CONTENTS I . [5100] SUBJECT nF AGR-vEMFNT 1 A. [§101] Purpose of the Agreement . . . . . . . . 1 B . [§102] The Redevelopment Plan . . . . . . . . . . 1 C . [§103] The Redevelopment Project Area . . 1 D. [§104] The Property . . . . . . . . . . . . . . . . . . . . 1 E . [§105] Parties to the Agreement . . . . . . . . 2 1 . [§106] The Agency . . . . . . . . . . . . . . . . . 2 2 . [§107] The Developer . . . . . . . . . . . . . . 2 F . [§108] Prohibition Against Change in Ownership, Management and Control of Developer . . . . . . . . 2 II . [§200] DISPOSITION OF THE PROPERTY . . . . . . . . . . 3 A. [§201] Sale and Purchase of the Property . . . . . . . . . . . . . . . . . . . . . . . . 3 B . [§202] Escrow . . . . . . . . . . . . . . . . . . . . . . . . . . 4 C. [§203] Conveyance of Title and Delivery of Possession . . . . . . . . . . 7 D. [§204 ] Form of Grant Deed and Covenant Agreement . . . . . . . . . . . . . . . . . . . . . . . 7 E . [§205] Condition of Title . . . . . . . . . . . . . . 8 F . [§206] Time for and Place of Delivery of Grant Deed . . . . . . . . . . . . . . . . . . . 8 G . [§207] Payment of the Purchase Price and Recordation of the Grant Deed . . . 8 H. [§208] Title Insurance . . . . . . . . . . . . . . . . . 9 I . [§209] Taxes and Assessments . . . . . . . . . . . 9 J. [§210] Occupants of the Property . . . . . . . 9 K. [§211] Zoning of the Property . . . . . . . . . . 9 L. [§212] Condition of the Property . . . . . . . 10 1 . [§213 ] Suitability of the Property . . 10 2 . [§214 ] "As Is" Conveyance . . . . . . . . . . . 11 M. [§215] Access to and Entry by the Developer upon the Property . . . . . 12 N. [§216] Representations and Warranties ofAgency . . . . . . . . . . . . . . . . . . . . . . . 12 O. [§217] Representations and Warranties of Developer . . . . . . . . . . . . . . . . . . . . 13 P. [§218] Developer ' s Condition Precedent to Closing . . . . . . . . . . . . . . . . . . . . . . 14 III . [§300] DEVELOPMENT OF THE PROPERTY . . . . . . . . . . 14 A. [§301] Scope of Development . . . . . . . . . . . . 14 B . [§302 ] Cost of Construction . . . . . . . . . . . . 15 ( i) C. [§303] City and Other Governmental Agency Permits . . . . . . . . . . . . . . . . . . 15 D. [§304] Rights of Access . . . . . . . . . . . . . . . . 15 E. [S3051 Lccal, State and Federal I,acas . . . 1.5 F. [§306] Nondiscrimination During Construction . . . . . . . . . . . . . . . . . . . . 15 G. [§307] Certificate of Completion . . . . . . . 15 IV. [§400] USE OF THE PROPERTY . . . . . . . . . . . . . . . . . . 16 A. [§401] Uses 16 B. [§402] Obligation to Refrain from Discrimination . . . . . . . . . . . . . . . . . . 17 C. [§403] Form of Nondiscrimination and Nonsegregation Clauses . . . . . . . . . . 17 D. [§404] Effect and Duration of Covenants . . . . . . . . . . . . . . . . . . . . . . . 18 E. [§405] Public Agency Rights of Access for Construction, Repair and Maintenance of Public Improve- ments and Facilities . . . . . . . . . . . . 18 V. [§500] DEFAULTS, REMEDIES AND TERMINATION . . . 19 A. [§501] Defaults - General . . . . . . . . . . . . . . 19 B. [§502] Legal Actions . . . . . . . . . . . . . . . . . . . 19 1 . [§503] Institution of Legal Actions 19 2 . [§504] Applicable Law . . . . . . . . . . . . . 20 3 . [§505] Acceptance of Service of Process . . . . . . . . . . . . . . . . . . . . 20 C. [§506] Rights and Remedies are Cumulative . . . . . . . . . . . . . . . . . . . . . . 20 D. [§507] Damages 20 E. [§508] Specific Performance . . . . . . . . . . . . 20 F. [§509] Remedies and Rights of Termination . . . . . . . . . . . . . . . . . . . . . 21 1 . [§510] Termination of Developer . . . 21 2 . [§511] Termination by Agency . . . . . . 21 G. [§512] Rights and Remedies Subsequent to the Issuance of a Certificate of 23 Completion . . . . . . . . . . . . . . . . . . . . . . VI . [§600] GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . 23 A. [§601] Notices , Demands and Communications Between the Parties . . . . . . . . . . . . . . . . . . . . . . . . . 23 ( ii) B. [§602] Conflicts of Interest . . . . . . . . . . . 23 C. [§603] Warranty against Payment of Consideration for Agreement . . . . . 24 T?- L§5041 Nonliahility, of Agency Officials and Employees . . . . . . . . . 24 E. [§605] Enforced Delay: Extension of Times of Performance . . . . . . . . . . . . 24 F. [§606] Inspection of Books and Records 24 G. [§607] Approval by the Agency and theDeveloper . . . . . . . . . . . . . . . . . . . 25 H. [§608] Plans and Data . . . . . . . . . . . . . . . . . . 25 VII . [§700] ENTIRE AGREEMENT, WAIVERS AND AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 VIII . [§800] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 ATTACHMENTS Attachment No . 1 Property Map Attachment No . 2 Legal Description Attachment No . 3 Scope of Development Attachment No . 4 Grant Deed Attachment No . 5 Seller ' s Disclosure Statement Attachment No . 6 Cooperative Parking Agreement ( iii) DISPOSITION AND DEVELOPMENT AGREEMENT THIS AGREEMENT is entered into by and between the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, a public body, corporate and politic ( "Agency" ) , and RALPH FURRA, an individual , ( "Developer" ) . The Agency and the Developer agree as follows : I . [§100] SUBJECT OF AGREEMENT A. [§1011 Purpose of the Agreement 1 . The purpose of this Agreement is to effectuate the Redevelopment Plan for the Central Redevelopment Project (the "Redevelopment Project" ) by providing for the disposition and development of property owned by the Agency within the Redevelopment Project area . The disposition of the Property by the Agency is authorized by Article 11, Sections 33430 et seg. of the California Health and Safety Code and is in the vital and best interest of the City of San Juan Capistrano and the health, safety, and welfare of its residents , necessary for purposes of redevelopment within the Project Area , and in accord with the public purposes and provisions of applicable federal , state, and local laws and requirements . B. [§ 1021 The Redevelopment Plan This Agreement is subject to the provisions of the Redevelopment Plan for the Redevelopment Project , which was approved and adopted by the City Council of the City of San Juan Capistrano by Ordinance No . 408 , and amended by Ordinance Nos . 509 , 547 and 582 ; said ordinances and the Redevelopment Plan (the "Redevelopment Plan" ) are incorporated herein by reference and made a part hereof as though fully set forth herein. C. [§ 1031 The Redevelopment Project Area The San Juan Capistrano Project Area (the "Project Area" ) is located in the City of San Juan Capistrano, California , (the "City" ) . The exact boundaries of the Project Area are specifically and legally described in the Redevelopment Plan. D. [§ 1041 The Property The Agency holds fee title to certain real property in the City (Assessor Parcel #124-160-21) located at 31786 Camino Capistrano (the "Property" ) . The Property is in the Project Area and is shown on the "Property Map" attached hereto as Attachment No . 1 and described in the "Legal Description of the Property" attached hereto as Attachment No . 2 , both Attachments incorporated herein by reference. The Property encompasses approximately 15 , 31.0 square feet and includes an existing two-unit retail building of approximately 3 , 600 square feet . E . [§ 1051 Parties to the Agreement 1 . [§ 1061 The Agency The Agency is a public body, corporate and politic, exercising governmental functions and powers , and organized and existing under Chapter 2 of the Community Redevelopment Law of the State of California . The principal office of the Agency is located at 32400 Paseo Adelanto, San Juan Capistrano, California, 92675 , Attention: Executive Director . "Agency" as used in this Agreement includes the San Juan Capistrano Community Redevelopment Agency and any assignee of or successor to its rights , powers and responsibilities . 2 . [§ 1071 The Developer The Developer is an individual . The principal office of the Developer for purposes of this Agreement is California , Wherever the term "Developer" is used herein, such term shall include any permitted nominee, assignee or successor in interest as herein provided. F . [§108] Prohibition against Change in Ownership, Management and Control of Developer The Developer represents and agrees that its purchase of the Property and its other undertakings pursuant to this Agreement are, and will be used, for the purpose of redevelopment of the Property and not for speculation in land holding . The Developer further recognizes that , in view of : (a) the importance of the redevelopment of the Property to the general welfare of the community; (b) the public aids that have been made available by law and by the government for the purpose of making such redevelopment possible; and 07/31/92 1661Q/2299/00 - 2 - (c) the fact that a change in ownership or control of the Developer or of a substantial part thereof, or any other act or transaction involving or resulting in a significant change in ownership or control of the Developer or the degree thereof , is for practical purposes a transfer or disposition of the property then owned by the Developer, the qualifications and identity of the Developer, and its principals , are of particular concern to the community and the Agency. The Developer further recognizes that it is because of such qualifications and identity that the Agency is entering into this Agreement with the Developer . No voluntary or involuntary successor in interest of Developer shall acquire any rights or powers under this Agreement except as expressly set forth herein, and the Developer shall not assign all or any part of this Agreement without the prior written approval of the Agency. The restrictions of this Section 108 shall terminate upon issuance by the Agency of a Certificate of Completion for the Property as described in Section 306 of this Agreement . II . [§200] DISPOSITION OF THE PROPERTY A. [§201] Sale and Purchase of the Property 1 . Purchase and Sale In accordance with and subject to all the terms , covenants and conditions of this Agreement, the Agency agrees to sell the Property to the Developer and Developer agrees to purchase the Property from the Agency. 2 . Purchase Price The Purchase Price payable for the Property and the terms of the purchase by the Developer shall be Five Hundred Thousand Dollars ($500, 000 . 00) cash (the "Purchase Price" ) . 3 . Developer Good Faith Deposit ; Liquidated Damages Within forty-eight (48) hours of the opening of escrow by the Agency as provided in Section 202 of this Agreement , the Developer shall deliver to the Agency cash or a cashier ' s or certified check in the amount of Fifty Thousand Dollars ($50 , 000 . 00) . The above described funds delivered to the Agency are herein called the "Good Faith Deposit . " 07/31/92 1661Q/2299/00 - 3 - 0 Upon the occurrence of the termination of this Agreement pursuant to Section 510 hereof , the Good Faith Deposit shall be promptly returned to the Developer . Upon the termination of this Aar_eement Pursuant to Section 511 hereof , the Good Faith Deposit shall be retained by the Agency as liquidated damages , as further provided in Section 511 hereof . B. [§2027 Escrow The Agency agrees to open an escrow for conveyance of the Property with First American Title Insurance Company, or such other escrow agent as may be agreed upon by the parties (the "Escrow Agent" ) , not later than ninety (90) days after the execution of this Agreement by the Agency. Sections 104 through 107 and 200 through 209 , inclusive, shall constitute the joint escrow instructions of the Agency and the Developer with respect to the sale and purchase of the Property, and a duplicate original of this Agreement shall be delivered to the Escrow Agent upon the opening of escrow. The Agency and the Developer shall provide such additional escrow instructions as shall be necessary and consistent with this Agreement . The Escrow Agent is hereby empowered to act under this Agreement and upon indicating its acceptance of the applicable provisions of this Agreement in writing, delivered to the Agency and to the Developer within five (5) days after opening of the escrow, shall carry out its duties as Escrow Agent hereunder . Upon delivery to the Escrow Agent by the Agency of the Grant Deed for the Property pursuant to Section 206 of this Agreement , the Escrow Agent shall record such deed when title thereto can be vested in the Developer in accordance with the terms and provisions of this Agreement . The Escrow Agent shall buy, affix, and cancel any transfer stamps required by applicable law, and pay any transfer tax required by law. Any insurance policies governing the Property are not to be transferred. The Developer shall pay in escrow to the Escrow Agent the following fees, charges and costs promptly after the Escrow Agent has notified the Developer of the amount of such fees , charges , and costs , but not earlier than ten (10) days prior to the scheduled date for the conveyance of the Property: 1 . One-half of the escrow fee; 2 . The portion of the premium for the title insurance policies to be paid by the Developer as set forth in Section 208 of this Agreement; 07/31/92 1661Q/2299/00 - 4 - 3 . Any State, County or City documentary stamps ; 4 . Any transfer tax. The Developer shall deposit the Purchase Price for the Property ( less the Good Faith Deposit) and any other amounts required by the provisions of this Agreement with the Escrow Agent in accordance with the provisions of Section 207 of this Agreement . The Escrow Agent shall charge the following fees , charges , and costs to the Agency and deduct the same from the Purchase Price provided that prior to the close of escrow, the Agency has approved a pro forma closing statement setting forth the amount of such fees , charges and costs: 1 . Costs necessary to place title to the Property in the condition required by the provisions of this Agreement ; 2 . One-half of the escrow fee; 3 . Cost of drawing the deed; 4 . Recording fees ; 5 . Notary fees ; 6 . The portion of the premium for the title insurance policy to be paid by the Agency as set forth in Section 208 of this Agreement ; 7 . Ad valorem taxes , if any, upon the Property for any time prior to conveyance of title. The Agency shall furnish, at its expense, a termite report for the Property within thirty (30) days of the date of this Agreement . The Developer shall be solely responsible for any necessary repairs or corrections required or recommended by the termite report . The Agency shall timely and properly execute, acknowledge and deliver a Grant Deed for the conveyance of title to the Property (or other transferring document) in substantially the form established in Section 204 of this Agreement and attached hereto as Attachment No . 4 and incorporated herein by reference. The Escrow Agent is authorized to : 1 . Pay, and charge the Agency and the Developer respectively, for any fees , charges and costs payable under Section 202 of this Agreement . Before such payments are made, 07/31/92 1661Q/2299/00 - 5 - the Escrow Agent shall notify the Agency and the Developer of the fees , charges and costs necessary to clear title and close the escrow. 2 . Disburse funds and deliver the Grant Deed and other documents to the parties entitled thereto when the conditions of this escrow have been fulfilled by the Agency and the Developer . Such funds shall not be disbursed by the Escrow Agent unless and until it has recorded the Grant Deed (Attachment No . 4) to the Property and is prepared to deliver to the Developer a title insurance policy insuring and conforming to the requirements of Section 208 of this Agreement . 3 . Record any instruments delivered through this escrow if necessary or proper to vest title in the Developer in accordance with the terms and provisions of the escrow instructions portion of this Agreement (Sections 104-107 and 200-209 , inclusive) . 4 . Report all information required pursuant to Internal Revenue Service Code Section 6045 (a) regarding the disposition of the Property by the Agency to the Developer hereunder, and provide copies of all such reports to all parties hereto . All funds received in this escrow shall be deposited by the Escrow Agent in a general escrow account with any state or national bank doing business in the State of California and reasonably approved by the Developer and the Agency, and may be combined in such with other escrow funds of the Escrow Agent . If this escrow is not in condition to close on or before the time for conveyance established in Section 203 of this Agreement, either party who then shall have fully performed the acts to be performed before the conveyance of title may, in writing, demand the return of its money, papers , or documents from the Escrow Agent . No demand for return shall be recognized until ten ( 10) days after the Escrow Agent (or the party making such demand) shall have mailed copies of such demand to the other party at the address of its principal place of business . Objections, if any, shall be raised by written notice to the Escrow Agent and to the other party within the 10-day period, in which event the Escrow Agent is authorized to hold all money, papers and documents until instructed by mutual agreement of the parties or, upon failure thereof , by a court of competent jurisdiction. If no such demands are made, the escrow shall be closed as soon as possible. If objections are raised as above provided for , the Escrow Agent shall not be obligated to return any such money, papers or documents except upon the written instructions of both the Agency and the Developer , or until the party entitled 07/31/92 1661Q/2299/00 - 6 - thereto has been determined by a final decision of a court of competent jurisdiction. If no such objections are made within said 10-day period, the Escrow Agent shall immediately return the demanded money, pavers or cloeumerts _ Any amendment to these escrow instructions shall be in writing and signed by both the Agency and the Developer . At the time of any amendment , the Escrow Agent shall agree to carry out its duties as Escrow Agent under such amendment . All communications from the Escrow Agent to the Agency or the Developer shall be directed to the addresses and in the manner established in Section 601 of this Agreement for notices , demands, and communications between the Agency and the Developer . The liability of the Escrow Agent under this Agreement is limited to performance of the obligations imposed upon it under Sections 104 through 107 and Sections 200 through 209 , inclusive, of this Agreement . The Agency shall not be liable for any real estate commissions or brokerage fees which may arise herefrom. The Agency represents that it has engaged no broker , agent, or finder in connection with this transaction, and the Developer agrees to hold the Agency harmless from any claim by any broker, agent or finder retained by the Developer . C. [§203] Conveyance of Title and Delivery of Possession Subject to any mutually agreed upon extension of time, conveyance to the Developer of title to the Property in accordance with the provisions of Section 205 of this Agreement shall be concurrent with the Developer ' s acquisition of the "Swallow' s Inn" business operation and name, or such later date as authorized by the Agency and the Developer and communicated in writing to the Escrow Agent . The Developer shall provide the Escrow Agent with immediate notice of the completion of said acquisition. Possession of the Property shall be delivered to the Developer concurrently with the conveyance of title. The Developer shall accept title to and possession of the Property on or before the date established for conveyance in this Section 203 . D. [§204] Form of Grant Deed and Covenant Agreement The Agency shall convey to the Developer title to the Property in the condition provided in Section 205 of this 07/31/92 1661Q/2299/00 - 7 - • Agreement by Grant Deed (or other conveyancing instrument) substantially in the form of Attachment No . 4 and consistent with the provisions of Section 205 of this Agreement . The Grant Deed (Attachment No . 4) shall contain covenants necessary or desirable to carry out this Agreement . E . [§205] Condition of Title The Agency shall convey to the Developer fee simple title to the Property free and clear of all liens , encumbrances, assessments , easements , leases and taxes , except the Redevelopment Plan and except those which are set forth in this Agreement and included in the Grant Deed (Attachment No. 4) , and those which are otherwise consistent with this Agreement . Furthermore, title to the Property shall be subject to the exclusion therefrom (to the extent now or hereafter validly excepted and reserved by the parties named in existing deeds, leases , and other documents of record) of all oil , gas , hydrocarbon substances and minerals of every kind and character lying more than 500 feet below the surface, together with the right to drill into, through, and to use and occupy all parts of the Property lying more than 500 feet below the surface thereof for any and all purposes incidental to the exploration for and production of oil , gas , hydrocarbon substances or minerals from the Property, but without, however , any right to use or disturb either the surface of the Property or any portion thereof within 500 feet of the surface for any purpose or purposes whatsoever . Notwithstanding any other provision of this Agreement to the contrary, the Agency may obtain possession of part or all of the Property by means of an order of immediate possession from a court exercising eminent domain jurisdiction or similar right . F . [§206] Time for and Place of Delivery of Grant Deed Subject to any mutually agreed upon extension of time, the Agency shall deposit the Grant Deed (Attachment No . 4 ) for the Property with the Escrow Agent on or before the date established for the conveyance of the Property in Section 203 of this Agreement . G . [§207] Payment of the Purchase Price and Recordation of the Grant Deed The Developer shall promptly deposit the Purchase Price ( less the Good Faith Deposit) with the Escrow Agent no later than one ( 1) day prior to the date for conveyance, provided 07/31/92 1661Q/2299/00 - 8 - that the Escrow Agent shall have notified the Developer in writing that the Grant Deed (Attachment No. 4) , properly executed and acknowledged by the Agency, has been delivered to the Escrow Agent and that title is in the condition to be conveyed in conformity with the provisions of Section 205 of this Agreement . The Escrow Agent shall deliver the Purchase Price to the Agency in accordance with Section 203 at such time as the Escrow Agent is prepared to deliver to the Developer a title insurance policy in conformity with Section 208 of this Agreement, and shall promptly file the Grant Deed for recordation among the land records in the Office of the County Recorder for Orange County. H. [§208] Title Insurance Concurrently with recordation of the Grant Deed, First American Title Insurance Company or another insurance company acceptable to the parties (the "Title Insurance Co . " ) shall provide and deliver to the Developer a title insurance policy (which at the Developer ' s option may be an ALTA owner ' s policy) issued by the Title Insurance Co . insuring that title to the Property is vested in the Developer in the condition required by Section 205 of this Agreement . The Title Insurance Co . shall provide the title insurance policy, and the title insurance policy shall be in the amount of the Purchase Price for the Property or in such greater amount as the Developer may specify as hereinafter provided. The Agency shall pay only for that portion of the title insurance premium attributable to a CLTA or ALTA standard form owner ' s policy of title insurance in the amount of the Purchase Price for the Property. The Developer shall pay for all additional premiums , including those for any extended coverage or special endorsements which it requests . I . [§2091 Taxes and Assessments All ad valorem taxes and assessments levied or imposed for any period commencing after conveyance of title to or delivery of possession of the Property to the Developer and taxes upon this Agreement or any rights hereunder , shall be borne by the Developer . J. [§2101 Occupants of the Property Agency agrees that title to the Property shall be conveyed free of any possession or right of possession. K. [§211) Zoning of the Property The Property is presently zoned CT (Tourist Commercial) and is subject to the Architectural Design Guidelines . The 07/31/92 1661Q/2299/00 - 9 - Developer shall insure that all plans for improvement and/or rehabilitation of the Property conform to said zoning and guidelines . L. [§212] Condition of the Property For the purposes of Section 213 , Section 214 and Section 217 hereto , the term "Hazardous Materials" shall mean ( i) any "hazardous substance" as defined by the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. Section 9601 et seg. ) , as amended from time to time, and regulations promulgated thereunder; (ii) any "hazardous substance" as defined by the Carpenter-Presley-Tanner Hazardous Substance Account Act (California Health and Safety Code Sections 25300 et seg. ) , as amended from time to time, and regulations promulgated thereunder; (iii) asbestos; ( iv) polychlorinated biphenyls; (v) petroleum, oil, gasoline ( refined and unrefined) and their respective by-products and constituents ; and (vi) any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever, which by any "Governmental Requirements" either requires special handling in its use, transportation, generation, collection, storage, handling , treatment or disposal , or is defined as "hazardous" or harmful to the environment . The term "Governmental Requirements" shall mean all laws , ordinances, statutes, codes , rules , regulations , orders and decrees of the United States , the State, the County, the City, or any other political subdivision in which the Property is located, and of any other political subdivision, agency or instrumentality exercising jurisdiction over the Agency, the Developer or the Property. 1 . [§213 ] Suitability of the Property The Developer acknowledges and agrees that the Agency will provide the Developer with access to the Property for the purpose of investigating and determining the presence of Hazardous Materials , soil condition of the Property, its seismic condition, its geology, the presence of known and unknown faults , and the suitability of the Property for economically feasible development and use thereof by the Developer in accordance with this Agreement . The Developer shall have thirty (30) days from the date of execution of this Agreement by the Agency to undertake, at the Developer ' s sole cost and expense, the Hazardous Materials assessment of the Property (the "Hazardous Materials Assessment" ) . The Developer shall provide the Agency with a copy of the Hazardous Materials Assessment immediately upon receipt of same by the Developer . In the event it is determined by the Hazardous Materials Assessment that remediation is required, and the cost 07/31/92 1661Q/2299/00 - 10 - thereof is projected to exceed the amount of Fifty Thousand Dollars ($50, 000) , the Developer shall have the option to terminate the Agreement . The Developer shall exercise such option by giving the Agency written notice, within three (3) days of the receipt of the Hazardous Materials Assessment . In the event it is determined by the Hazardous Materials Assessment that the cost of remediation will be equal to or less than Fifty Thousand Dollars ($50, 000 . 00) , or if the cost of such remediation exceeds Fifty Thousand Dollars ($50, 000 . 00) but the Developer has not terminated this Agreement pursuant to this Section 213 , or Section 510 of this Agreement , the Developer shall cause the required remediation to be performed with the cost of the remediation to be borne solely by the Developer . 2 . [§214] "As Is" Conveyance Possession of the Property shall be delivered from the Agency to the Developer in an "as is" physical condition, with no warranty, expressed or implied by the Agency as to the presence or absence of Hazardous Materials or the condition of the soil, its geology, or the presence or absence of known or unknown faults , or the suitability of the Property for any particular use or purpose. However, the Agency shall pay for the cost of any relocation benefits required to be paid to occupants of the Property. The Agency acknowledges that the existing building upon the Property is constructed using a reinforced masonry block method and does not meet the standards of SB547 . The Agency cannot warrant that future seismic safety improvements to the building may be required relating to changes in State law. If the condition of the Property (including the building thereon) is not in all respects entirely suitable for the use or uses to which the Property will be put , then it is the sole responsibility and obligation of the Developer to place the Property in all respects in a condition entirely suitable for the development and/or use thereof . After delivery of possession of the Property, the Developer shall defend, release, indemnify and hold the Agency, the City, and their officers , employees , contractors , and/or agents harmless from any claims, liability, injury, damages , costs and expenses ( including , without limitation, the cost of any clean-up of Hazardous Materials and the cost of attorneys ' and consultants ' fees arising as a result of the presence of Hazardous Materials) which the use Agency may sustain as a result of the presence or clean-up of Hazardous Materials on the Property. 07/31/92 1661Q/2299/00 • M. [§215] Access to and Entry by the Developer upon the Property The Developer shalt nave the right of access to and entry upon the Property for the purpose of obtaining data and making surveys and tests necessary for the Hazardous Materials Assessment . The Developer agrees to and shall defend, release, indemnify and hold the Agency and the City harmless from and against any and all injuries or damages, and any liens , arising out of any work or activity of the Developer, its agents , servants, employees or contractors . The Agency agrees to provide or cause to be provided to the Developer all data and information pertaining to the Property and available to the Agency when requested in writing by the Developer . The Agency makes no warranty as to the accuracy or sufficiency of such data or information. N. [§216] Representations and Warranties of Agency The Agency hereby represents and warrants to the Developer as follows : 1 . The Agency is the owner of the Property and/or has the full right, power and authority to transfer the Property to the Developer as provided herein and to perform all of the Agency' s obligations hereunder . 2 . To the best of the Agency' s knowledge, there are no unsatisfied mechanic ' s or materialman' s lien rights concerning the Property. 3 . Except as to proposed Ortega Highway Realignment plans , to the best of the Agency' s knowledge, no actions , suits, or proceedings are pending or threatened before any governmental department , commission, board, bureau, agency or instrumentality that would adversely affect the Property or the right to occupy or utilize it . 4 . The Agency has disclosed all information concerning the Property of which the Agency is aware on the "Seller ' s Disclosure Statement" attached hereto as Attachment No . 5 and incorporated herein by reference . If the Agency becomes aware of any fact or circumstance which would change or render incorrect , in whole or in part, any representation or warranty by the Agency under this Agreement , whether as of the date given or any time thereafter through the close of Escrow, and whether or not such representation or warranty was based on the Agency' s knowledge and/or belief as of a certain date, the Agency will give immediate written notice of such changed facts or circumstances immediately to the Developer . 07/31/92 1661Q/2299/00 - 12 - O. [§217] Representations and Warranties of Developer The Developer hereby represents and warrants to, and covenants with, the Agency as follows : 1 . The Developer is familiar with the Property and has made such independent investigations as the Developer deems necessary or appropriate concerning all aspects of the Property, including, but not limited to, its title, physical condition, economic viability, financing and any and all other matters relating to the Property. 2 . Except for the Seller ' s Disclosure Statement (Attachment No . 5) and the Agency' s representations and warranties under Section 216 of this Agreement, the Developer is relying solely upon its own inspection, investigation and analysis of the foregoing matters in purchasing the Property, and is not relying in any way upon any representations , statements, agreements , warranties, studies , plans , reports , descriptions , guidelines or other information or material furnished by the Agency or its representatives, whether oral or written, express or implied, of any nature whatsoever regarding any of the foregoing matters . 3 . Except for the Seller ' s Disclosure Statement (Attachment No . 5) and the Agency' s representations and warranties under Section 216 of this Agreement, the Developer acknowledges that it is aware of the condition of the building infrastructure and utilities and that it is acquiring the Property "as is" without representation or warranty by the Agency or any of the Agency' s representatives or agents as to any matters . 4 . In purchasing the Property on an "as is" basis, the Developer acknowledges that in the past certain Hazardous Materials (as defined in Section 212 of this Agreement) may have been stored on and deposited onto the Property which storage and depositing may violate local , state and federal laws, may result in restrictions being placed on the Developer ' s use of the Property and may result in fines , damages , cleanup costs and other liability being assessed against the Developer as owner of the Property. The Developer agrees that it will make no claims against the Agency or any person comprising the Agency for any fines , damages , costs or other losses the Developer suffers because of the past storage or depositing of Hazardous Materials on the Property. The Developer releases the Agency from any liability, loss , damage, judgment , fine, claim, cost or expense ( including, without limitation, attorneys ' fees and court costs) arising from or related to the storage or deposit of Hazardous Materials on the Property, whether or not caused in whole or in part by the 07/31/92 1661Q/2299/00 - 13 - • active or passive negligence of the Agency. Further the Developer agrees that the Agency shall not be liable for the Developer ' s inability to use or develop the Property as intended for any reason whatsoever due to the past storage or depositing of Hazardous Materials on the Property and that such storage and depositing shall not provide any grounds whatsoever to support rescission of this Agreement or any other recovery by the Developer under this Agreement . In addition, the Agency shall have no liability for any subsequently discovered defects, whether latent or patent , or any other problems related to the Property. 5 . The Developer acknowledges that certain exterior or interior modifications to the building, including changes to the facade, may require approval through the normal City review process . The Developer understands that all permit and processing fees and deposits for such modifications are to be paid by the the Developer . 6 . The Developer acknowledges he is aware of the proposed Ortega Highway Realignment plans and the potential adverse impact it may have upon any business conducted upon the Property. The Developer releases the Agency and the City from any claims , liability, or causes of action regarding damage to his business from such impacts . 7 . The Developer agrees to enter into a Cooperative Parking Agreement with the Agency in substantially the form attached hereto as Attachment No . 6 and incorporated herein by reference, for the purpose of pursuing discussions regarding long-term parking improvements and policies in the vicinity of the Property. These parking improvements may involve the rear parking area of the Property. P. [§218] Developer ' s Condition Precedent to Closing The obligation of the Developer to complete his purchase of the Property shall be subject to and contingent upon the consummation of the Developer ' s acquisition of the "Swallow' s Inn" business operation and name. III . [§300] DEVELOPMENT OF THE PROPERTY A. [§301] Scope of Development The Property shall be developed by the Developer in accordance with the Redevelopment Plan and the "Scope of Development" attached to this Agreement as Attachment No . 3 and incorporated herein. 07/31/92 1661Q/2299/00 - 14 - B. [§302] Cost of Construction The cost of developing the Property and of constructing all improvements thereon shall be borne solely by the Developer . C. [§303] City and Other Governmental Agency Permits The Developer shall , at its own expense, secure or cause to be secured, any and all permits which may be required by the City or any other governmental agency affected by such construction, development, or work. D. [§304] Rights of Access Representatives of the Agency and the City shall have the reasonable right of access to the Property without charge or fees , at normal construction hours during the period of construction for the purposes of this Agreement , including, but not limited to, the inspection of the work being performed in constructing the and/or rehabilitating improvements . Such representatives of the Agency or the City of San Juan Capistrano shall be those who are so identified in writing by the Community Development Director of the Agency. E. [§305] Local, State and Federal Laws The Developer shall carry out the construction of the improvements on the Property in conformity with all applicable laws , including all applicable federal and state labor standards . F. [§3061 Nondiscrimination During Construction The Developer for itself , its successors and assigns, agrees that in the construction and/or rehabilitation of the improvements on the Property provided for in this Agreement , the Developer will not discriminate against any employee or applicant for employment because of race, color, creed, religion, sex, marital status , or national origin or ancestry. G. [§3071 Certificate of Completion Promptly after completion of all construction and/or rehabilitation of the improvements to be completed by the Developer upon the Property, as generally and specifically required by this Agreement and in particular the Scope of Development (Attachment No . 3) , and all plans approved pursuant hereto, the Agency shall furnish the Developer with a Certificate of Completion upon written request therefor by the Developer . Such Certificate of Completion shall be, and shall so state, conclusive determination of satisfactory completion 07/31/92 1661Q/2299/00 - 15 - of the construction required by this Agreement upon the Property. The Certificate of Completion shall be in such form as to permit it to be recorded in the Recorder ' s Office of Orange County. If the Agency refuses or fails to furnish a Certificate of Completion for the Property after written request from the Developer , the Agency shall , within thirty (30) days of the written request , provide the Developer with a written statement of the reasons the Agency refused or failed to furnish a Certificate of Completion. The statement shall also contain the Agency' s opinion of the action the Developer must take to obtain a Certificate of Completion. If the reason for such refusal is confined to a matter deemed insubstantial by the Community Development Director, the Agency may issue its Certificate of Completion upon the posting of a bond by the Developer with the Agency in an amount representing the fair value of the work not yet completed. If the Agency shall have failed to provide such written statement within said 30-day period, the Developer shall be deemed entitled to the Certificate of Completion. Such Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of the Developer to any Holder or any insurer of a mortgage securing money loaned to finance the improvements , or any part thereof . Such Certificate of Completion is not notice of completion as referred to in Section 3093 of the California Civil Code. IV. [§400] USE OF THE PROPERTY A. [§401] Uses The Developer covenants and agrees (for itself , its successors , its assigns , and every successor in interest to the Property or any part thereof) that during construction and thereafter , the Developer , such successors , and such assigns shall : 1 . develop, rehabilitate, maintain and operate the Property as described in the Scope of Development (Attachment No . 3 ) and any plans approved pursuant hereto, and devote the Property to that use, as specified therefor in the Redevelopment Plan and this Agreement ; 07/31/92 1661Q/2299/00 - 16 - 2 . maintain the improvements on the Property in good condition and faithful to their western flavor and historic character, and keep the Property free from debris , graffiti or waste materials and maintain the landscaping in a healthy and weed-free condition; 3 . continue to operate the historic Swallows Inn business upon the Property for a minimum of (_) years after the date of conveyance of the Property to the Developer. B. [§402 ] Obligation to Refrain from Discrimination There shall be no discrimination against or segregation of any person, or group of persons , on account of race, color , creed, religion, sex, marital status , national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, and the Developer itself (or any person claiming under or through it) shall not 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 Property. C. [§403] Form of Nondiscrimination and Nonsegregation Clauses The Developer shall refrain from restricting the rental , sale or lease of the Property, or any portion thereof , on the basis of sex, marital status , race, color , religion, creed, ancestry or national origin of any person. All such deeds , leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses : 1 . In deeds : "The grantee herein covenants by and for himself , his heirs , executors , administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of , any person or group of persons on account of race, color, creed, religion, sex, marital status , national origin, or ancestry in the sale, lease, sublease, transfer , use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or any person claiming under or through him, 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 in the land herein conveyed . The foregoing covenants shall run with the land . " 07/31/92 1661Q/2299/00 - 17 - • �► 2 . In leases : "The lessee herein covenants by and for himself , his heirs, executors , administrators and assigns , and all persons claiming under or through him, ann this lease is Trade and accepted upon and subject to the following conditions : That there shall be no discrimination against or segregation of any person or group of persons on account of race, color , creed, religion, sex, marital status , national origin or ancestry, in the leasing , subleasing, transferring, use or enjoyment of the land herein leased nor shall the lessee himself , or any person claiming under or through him, 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 , sublessees, subtenants or vendees in the land herein leased. " 3 . In contracts : "There shall be no discrimination against or segregation of any person, or group of persons on account of race, color, creed, religion, sex, marital status , national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land, nor shall the transferee himself or any person claiming under or through him, 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 land. " D. [§404] Effect and Duration of Covenants The covenants established in this Agreement shall , without regard to technical classification and designation, be binding on the Developer and any successor in interest to the Property, or any part thereof , for the benefit and in favor of the Agency, its successors and assigns , and the City. Except as set forth in the following sentence , the covenants contained in this Agreement shall remain in effect until the termination of the Redevelopment Plan. The covenants against discrimination (set forth in Sections 402 and 403) shall remain in perpetuity. E . [§405] Public Agency Rights of Access for Construction, Repair and Maintenance of Public Improvements and Facilities The Agency for itself , and for the City and other public agencies , at their sole risk and expense , reserves the right to 07/31/92 1661Q/2299/00 - 18 - enter the Property or any part thereof at all reasonable times and with as little interference as possible, for the purposes of construction, reconstruction, maintenance, repair or service of any public improvements or pubiiC facilities located on rhe Property. Any such entry shall be made only after reasonable notice to the Developer . Any damage or injury to the Property resulting from such entry shall be promptly repaired at the sole expense of the public agency responsible for the entry. V. [§500] DEFAULTS, REMEDIES AND TERMINATION A. [§501] Defaults - General Subject to the extensions of time set forth in Section 605, failure or delay by either party to perform any term or provision of this Agreement constitutes a default under this Agreement . The party who so fails or delays must immediately commence to cure, correct , or remedy such failure or delay, and shall complete such cure, correction or remedy with reasonable diligence, and during any period of curing shall not be in default . The injured party shall give written notice of default to the party in default, specifying the default complained of by the injured party. Failure or delay in giving such notice shall not constitute a waiver of any default , nor shall it change the time of default . Except as otherwise expressly provided in this Agreement, any failures or delays by either party in asserting any of its rights or remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies . Delays by either party in asserting any of its rights or remedies shall not deprive either party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect , assert or enforce any such rights or remedies . B. [§502] Legal Actions 1 . [§503] Institution of Legal Actions In addition to any other rights or remedies , either party may institute legal action to cure, correct or remedy any default , or to obtain any other remedy consistent with the purpose of this Agreement . Such legal actions may be instituted in the Superior Court of the County of Orange, State of California , in an appropriate municipal court in that County, or in the Federal District Court in the Central District of California . 07/31/92 1661Q/2299/00 - 19 - 2 . [§504] Applicable Law The laws of the State of California shall govern the interpretation and enforcement of this Agreement . 3 . [§505] Acceptance of Service of Process In the event that any legal action is commenced by the Developer against the Agency, service of process on the Agency shall be made by personal service upon the Secretary of the Agency, or in such other manner as may be provided by law. In the event that any legal action is commenced by the Agency against the Developer, service of process on the Developer shall be made by personal service upon the Developer or in such other manner as may be provided by law, and shall be valid whether made within or without the State of California . C. [§506] Rights and Remedies are Cumulative Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it , at the same time or different times, of any other rights or remedies for the same default or any other default by the other party. D. [§507] Damages If either party defaults with regard to any of the provisions of this Agreement, the nondefaulting party shall serve written notice of such default upon the defaulting party. If the default is not commenced to be cured within thirty (30) days after service of the notice of default and is not cured promptly in a continuous and diligent manner within a reasonable period of time after commencement , the defaulting party shall be liable to the nondefaulting party for any damages caused by such default , and the nondefaulting party may thereafter (but not before) commence an action for damages against the defaulting party with respect to such default . E. [§508] Specific Performance If either party defaults with regard to any of the provisions of this Agreement , the nondefaulting party shall serve written notice of such default upon the defaulting party. If the default is not commenced to be cured within thirty (30) days after service of the notice of default and is not cured promptly in a continuous and diligent manner within a reasonable period of time after commencement , the nondefaulting party, at its option, may thereafter (but not before) commence 07/31/92 1661Q/2299/00 - 20 - an action for specific performance of the terms of this Agreement pertaining to such default . F . 1§5091 Remedies and. Riuhts of Termination 1 . [§510] Termination by Developer (a) In addition to the Developer ' s option to terminate this Agreement as set forth in �- �ction 213 hereof, in the event the Developer is not in default*of any of the terms and conditions of this Agreement and the Agency does not tender conveyance of title and possession of the Property to the Developer in the manner and condition and within the time established therefor by Section 203 of this Agreement, then the Developer shall notify the Agency in writing to cure such failure within ninety (90) days after the date of receipt of such notice. If such failure shall not be cured within such ninety (90) day period, then this Agreement shall , at the option of the Developer , be terminated by written notice thereof to the Agency. In such event , the Purchase Price, if any shall have been paid, and the Good Faith Deposit shall be returned to the Developer, and thereafter neither the Agency nor the Developer (or assignee or transferee) shall have any further rights against or liability to the other under this Agreement . (b) Notwithstanding anything herein to the contrary, in the event conveyance of the Property has not occurred within five ( 5) days after the Developer has acquired the Swallows Inn business operation and name, or such later date as the parties shall agree in writing, either party hereto may terminate this Agreement upon thirty (30) days written notice to the other party. 2 . [§511] Termination by Agency In the event that prior to the conveyance of title or transfer of possession to the Property to the Developer : (a) The Developer (or any successor in interest) assigns or attempts to assign this Agreement or any rights herein, or makes any total or partial sale, transfer , or conveyance of the whole or any part of the Property or the improvements thereon, in violation of this Agreement ; or (b) There is a change in ownership of the Developer contrary to the provisions of Section 108 of this Agreement ; or (c) The Developer does not deliver the Good Faith Deposit to the Agency in the amount and within the time established therefor in Section 201 of this Agreement ; or 07/31/92 1661Q/2299/00 - 21 - (d) The Developer does not pay the Purchase Price, pursuant to Section 207 of this Agreement; or (e) The Developer does not take title to th? Property under a tender of conveyance by the Agency pursuant to this Agreement; or (f) The Developer is otherwise in default of this Agreement; then, in addition to any other remedy to which the Agency may be entitled, this Agreement and any rights of the Developer or transferee thereof arising from this Agreement shall, at the option of the Agency, be terminated by the Agency by written notice thereof to the Developer . From the date of the written notice of termination of this Agreement by the Agency to the Developer and thereafter this Agreement shall be deemed terminated and there shall be no further rights or obligations between the parties, except the retention of the entire Good Faith Deposit by the Agency as liquidated damages as hereinafter set forth. IN THE EVENT OF AGENCY TERMINATION OF THIS AGREEMENT UNDER THIS SECTION 511, THE GOOD FAITH DEPOSIT, AS SET OUT IN SECTION 201 HEREOF, SHALL BE RETAINED BY THE AGENCY AS LIQUIDATED DAMAGES AS THE SOLE AND EXCLUSIVE REMEDY OF THE AGENCY HEREUNDER. IN THE EVENT OF TERMINATION, THE AGENCY WOULD SUSTAIN DAMAGES BY REASON THEREOF WHICH WOULD BE UNCERTAIN. SUCH DAMAGES WOULD INVOLVE SUCH VARIABLE FACTORS AS THE DELAY OR FRUSTRATION OF TAX REVENUES THEREFROM TO THE CITY OF SAN JUAN CAPISTRANO AND THE AGENCY, THE DELAY OR FAILURE OF THE AGENCY TO FURTHER THE IMPLEMENTATION OF THE REDEVELOPMENT PLAN, AND A LOSS OF OPPORTUNITY TO ENGAGE IN OTHER POTENTIAL TRANSACTIONS, RESULTING IN DAMAGE AND LOSS TO THE AGENCY. IT IS IMPRACTICABLE AND EXTREMELY DIFFICULT TO FIX THE AMOUNT OF SUCH DAMAGES TO THE AGENCY, BUT THE PARTIES ARE OF THE OPINION, UPON THE BASIS OF ALL INFORMATION AVAILABLE TO THEM THAT SUCH DAMAGES WOULD APPROXIMATELY EQUAL THE AMOUNT OF THE GOOD FAITH DEPOSIT (WITH ANY INTEREST THEREON) , AND SUCH AMOUNT SHALL BE RETAINED BY THE AGENCY UPON TERMINATION AS THE REASONABLE TOTAL OF ALL LIQUIDATED DAMAGES FOR ANY AND ALL SUCH DEFAULTS AND NOT AS A PENALTY. IN THE EVENT THAT THE DEVELOPER SHOULD CHALLENGE THE APPLICABILITY OR EFFICACY OF THIS PARAGRAPH OR IF THIS PARAGRAPH SHOULD BE HELD TO BE VOID FOR ANY REASON, THE AGENCY SHALL BE ENTITLED TO THE FULL EXTENT OF DAMAGES OTHERWISE PROVIDED BY LAW. 07/31/92 1661Q/2299/00 - 22 - THE DEVELOPER AND THE AGENCY SPECIFICALLY ACKNOWLEDGE THIS LIQUIDATED DAMAGES PROVISION BY THEIR SIGNATURES BELOW: Developer Agency Notwithstanding the termination of the Agreement by the Agency as set forth in this Section 511, the obligation of the Developer to the Agency and the City set forth in Section 215 of this Agreement , shall remain in full force and effect . Notwithstanding anything herein to the contrary, the Agency shall have the right to terminate this Agreement pursuant to and in accordance with Section 510(b) hereinabove. G . [§512] Rights and Remedies Subsequent to the Issuance of a Certificate of Completion If either the Developer or the Agency defaults under any of the provisions of this Agreement subsequent to the issuance of the Certificate of Completion, then subject to the provisions of Section 501, the non-defaulting party at its option may institute an action at law or in equity, and/or the defaulting party shall be liable to the other party for any damages caused by such default, and/or the non-defaulting party may seek any remedies available at law or in equity. VI . [§6001 GENERAL PROVISIONS A. [§601] Notices , Demands and Communications Between the Parties Formal notices , demands and communications between the Agency and the Developer shall be deemed sufficiently given if dispatched by registered or certified mail , postage prepaid, return receipt requested, to the principal offices of the Agency and the Developer as provided in Section 106 and 107 of this Agreement . Such written notices , demands and communications may be sent in the same manner to such other addresses as either party may from time to time designate by mail as provided in this Section. B. [§602] Conflicts of Interest No member, official or employee of the Agency shall have any direct or indirect interest in this Agreement , nor participate in any decision relating to the Agreement which is prohibited by law. 07/31/92 1661Q/2299/00 - 23 - C. [§603] Warranty against Payment of Consideration for Agreement The Developer warrants that it has not paid or given, and will not pay or give, any third person any money or other consideration for obtaining this Agreement, other than normal costs of conducting business and costs of professional services such as architects , engineers and attorneys . D. [§604] Nonliability of Agency Officials and Employees No member, official or employee of the Agency shall be personally liable to the Developer , or any successor in interest, in the event of any default or breach by the Agency or for any amount which may become due to the Developer or successor , or on any obligation under the terms of this Agreement . E. [§605] Enforced Delay: Extension of Times of Performance In addition to specific provisions of this Agreement , performance by either party hereunder shall not be deemed to be in default where delays or defaults are due to war ; insurrection; strikes; lock-outs; riots ; floods ; earthquakes; fires; casualties ; acts of God; acts of the public enemy; epidemic; quarantine restrictions ; freight embargoes ; lack of transportation; governmental restrictions or priority; litigation (other than condemnation actions) ; unusually severe weather; inability to secure necessary labor, materials or tools; delays of any contractor, subcontractor or supplier ; acts of the other party; acts or the failure to act , of any public or governmental agency or entity (except that acts or failure to act of the Agency shall not excuse performance by the Agency) ; or any other causes beyond the control or without the fault of the party claiming an extension of time to perform. An extension of time for any such cause shall only be for the period of the enforced delay, and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by mutual agreement of the Agency and the Developer . F. [§606] Inspection of Books and Records The Agency has the right at all reasonable times to inspect the books and records of the Developer pertaining to the Property as pertinent to the purposes of this Agreement . 07/31/92 1661Q/2299/00 - 24 - G. [§607] Approval by the Agency and the Developer Wherever this Agreement requires the Agency or the Developer to approve any contract , document , pian .. proposal , specification, drawing or other matter, such approval shall not be unreasonably withheld. H. [§608] Plans and Data Where the Developer does not proceed with the purchase and development of the Property, and when this Agreement is terminated with respect thereto for any reason, the Developer shall deliver to the Agency any and all plans concerning the Property, and the Agency or any person or entity designated by the Agency shall have the right to use such plans and data . VII . [§700] ENTIRE AGREEMENT, WAIVERS AND AMENDMENTS This Agreement is executed in five (5) identical originals, each of which is deemed to be an original . This Agreement includes twenty-six (26) pages and six ( 6) Attachments which constitute the entire understanding and agreement of the parties . This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the parties with respect to all or any part of the subject matter hereof . None of the terms , covenants , agreements or conditions Set forth in this Agreement shall be deemed to be merged with the Grant Deed conveying title to the Property, the Covenant Agreement and this Agreement shall continue in full force and effect before and after such conveyance. All waivers of the provisions of this Agreement must be in writing and signed by the appropriate authorities of the Agency or the Developer, and all amendments hereto must be in writing and signed by the appropriate authorities of the Agency and the Developer . VIII . [§800 ] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY This Agreement , when executed by the Developer and delivered to the Agency, must be authorized, executed and delivered by the Agency within forty-five (45) days after the date of signature by the Developer , or this Agreement may be withdrawn by the Developer on written notice to the Agency. 07/31/92 1661Q/2299/00 - 25 - The date of this Agreement shall be the date when this Agreement shall have been signed by the Agency. SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, a public body, corporate and politic Date: By: Its : "AGENCY" APPROVED AS TO FORM: STRADLING, YOCCA, CARLSON & RAUTH By: Agency Special Counsel RALPH FURRA, an individual Date : By: Ralph Furra "DEVELOPER" 07/31/92 1661Q/2299/00 - 26 - STATE OF CALIFORNIA ) ss . COUNTY OF ORANGE ) On 1992 , before me, the undersigned, a Notary Public in and for said State, personally appeared RALPH FURRA, personally known to me (or proved to me on the basis of satisfactory evidence) to be the person who executed the within instrument as and acknowledged to me that he executed the same . WITNESS my hand and official seal . (SEAL) STATE OF CALIFORNIA ) ss . COUNTY OF ORANGE ) On 1992 , before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person who executed this instrument as the of the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY and acknowledged to me that the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY executed it . Signature of Notary Public Name typed or printed (SEAL) 07/31/92 1661Q/2299/00 - 27 - F.GN- '' SrREEr 0 SEL OB'S'` �� w i � J v ,.N fM AM It j1 ' 'O•C Nli N [b W. /r � 'o � h •t 6-is h Fya a, rt N 1 _r`• f c cu EL -j CAWMV MIL . ♦ t t 4 ® CAR3rMW 1 "1 COL �� 121 N01E - ASSESSOR'S Arocx B ASSESSOR'S MAP CIM _ 15 0 PARCEL NUMBERS BOOK124PAGE15 ��MARCN /95/ SHOWN /N CIRCLES COUNTr OF ORAAG£ 1 Li SAN .RNN GAP/SrRAtiO. RS?-35 ATTACHMENT NO. 2 LEGAL DESCRIPTION Lot 26 of Tract 103 , in the City of San Juan Capistrano, as shown on a map recorded in Book 11, Pages 29 to 33 inclusive, in the office of the Orange county recorder. The property is further identified as Assessor Parcel 124-160-121. ATTACHMENT NO. 2 ATTACHMENT NO. 3 SCOPE OF DEVELOPMENT The Developer understands the western flavor, historic character, and local legends surrounding the Property. The Developer is purchasing the Property in an "as is" condition, and will undertake the rehabilitation of the Property maintaining the integrity of the building and improvements theron, while at the same time providing necessary improvements and upgrades . In conjunction with the purchase of the Property, the Developer is acquiring the Swallows Inn business and name . The Developer will continue to operate the historic Swallows Inn business in this location for a minimum of years . 1661Q/2299/00 ATTACHMENT NO. 3 ATPACFID1FdV'P N0. 5 SELLER'S DISCLOSURE STATEMENT THIS DISCLOSURE STATEMENT CONCERNS THE REAL PROPERTY SITUATED IN THE CITY OF SAN JUAN CAPISTRANO, COUNTY OF ORANGE, STATE OF CALIFORNIA, LOCATED AT 31786 CAMINO CAPISTRANO (Assessor Parcel #124-160-21). THIS STATEMENT IS A DISCLOSURE OF THE CONDITION OF THE ABOVE DESCRIBED PROPERTY. IT IS NOT A WARRANTY OF ANY KIND BY THE SELLER AND IS NOT A SUBSTITUTE FOR ANY INSPECTIONS OR WARRANTIES THE BUYER MAY WISH TO OBTAIN. SELLER'S INFORMATION THE FOLLOWING INFORMATION IS A DISCLOSURE MADE BY THE SELLER AS TO THE SUBJECT PROPERTY AS REFERENCED IN SECTION 216 OF THAT CERTAIN DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY AND RALPH FURRA. THE SELLER DISCLOSES THE FOLLOWING INFORMATION WITH THE KNOWLEDGE THAT EVEN THOUGH THIS IS NOT A WARRANTY, THE BUYER MAY RELY ON THIS INFORMATION IN DECIDING WHETHER AND ON WHAT TERMS TO PURCHASE THE SUBJECT PROPERTY. A. The subject property has the items checked below (read across): Burglar Alarms _ Rain Gutters Central Heating _ Evaporator Cooler(s) Smoke Detector(s) _ Public Sewer System Fire Alarm _ Private Utility or Central Air Conditioning _ Other: _ Fire Sprinklers Exhaust Fan(s) in 220 Volt Wiring in Roof(s): Type: Age(approx.): Other: Are there, to the best of your (Seller's) knowledge, any of the above that are not in operating condition? _ Yes _ No. If yes, then describe. (Attach additional sheets if necessary.): B. Are you (Seller) aware of any significant defects/malfunctions in any of the following? _ Yes _ No. If yes, check appropriate space(s) below. _ Interior Walls _ Foundation Ceilings _ Slab(s) Floors _ Driveways _ Exterior Walls _ Sidewalks _ Insulation _ Walls/Fences Roof(s) _ Electrical Systems Windows _ Plumbing/Sewers Doors _ Other Structural Components(Describe: ) If any of the above is checked, explain. (Attach additional sheets if necessary.): C. Are you (Seller) aware of any of the following: 1. Substances, materials, or products which may be an environmental hazard such as, but not limited to, asbestos, formaldehyde, radon gas, lead-based paint, fuel or chemical storage tanks, and contaminated soil or water on the subject property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No 2. Features of the property shared in common with adjoining landowners, such as walls, fences, and driveways, whose use or responsibility for maintenance may have an effect on the subject property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No 3. Any encroachments, easements or similar matters that may affect your interest in the subject property . . . . . . . . . . . . Yes No 4. Structural modifications or other alterations or repairs made without necessary permits . . . . . . . . . . . . . . . . . . . . . . Yes No 5. Structural modifications or other alterations or repairs not in compliance with building codes . . . . . . . . . . . . . . . . . . Yes No 6. Landfill (compacted or otherwise) on the property or any portion thereof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No 7. Any settling from any cause, or slippage, sliding or other soil problems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No 8. Flooding, drainage or grading problems . . . . . . . . . . . . . Yes No 2299000 f:\dsWpub1\391\I Msfer.001 2 Yi w 9. Major damage to the property or any of the structures from fire, earthquake, floods or landslides . . . . . . . . . . . . . . . _ Yes _ No 10. Any zoning violations, nonconforming uses, violations of "setback" requirements . . . . . . . . . . . . . . . . . . . . . . . _ Yes _ No 11. Neighborhood noise problems or other nuisances . . . . . . . Yes _ No 12. CC&R's or other deed restrictions or obligations . . . . . . . _ Yes _ No 13. Any "common area" (facilities such as walkways or other areas co-owned in undivided interest with others) . . . . . . . . . . . Yes _ No 14. Any notices of abatement or citations against the property . . _ Yes _ No 15. Any lawsuits against the seller threatening to or affecting this real property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . , Yes _ No If the answer to any of these is yes, explain. (Attach additional sheets if necessary.): Seller certifies that the information herein is true and correct to the best of Seller's knowledge as of the date signed by the Seller. Seller: San Juan Capistrano Community Redevelopment Agency By: Date: Its: I ACKNOWLEDGE RECEIPT OF A COPY OF THIS STATEMENT. Buyer: Date: 2299000 E\date\puhl\391\trmsfer.001 3