01-0417_BRANDON, MILES D._Owner Participation AgreementOWNER PARTICIPATION AGREEMENT
This Agreement is made this 17th day of April 2001, by and between the San Juan
Capistrano Community Redevelopment Agency (hereinafter "Agency"), and Miles D.
Brandon, an individual (hereinafter "Owner").
RECITALS:
Whereas, Owner proposes to expand its automobile sales business known as
Capistrano Volkswagen at its existing location on Valle Road in San Juan Capistrano by
establishing new additional auto showroom and service areas ("the project improvements"),
and
Whereas, Owner intends to construct such project improvements on an adjoining
parcel which has previously been used for auto dealership purposes for many years, and
Whereas, Owner has requested financial assistance from the Agency to construct
certain public and related improvements to complete the project improvements, and
Whereas, Agency finds that pursuant to a study by its consultant, Keyser and
Marston Associates, the establishment of such improvements at this location will result in
substantial additional sales taxes to the City of San Juan Capistrano (hereinafter "City")
and property tax increment to the Agency, and
Whereas, Agency is authorized to provide financial assistance to Owner pursuant
to Health and Safety Code section 33220(b),
NOW, THEREFORE, BE IT MUTUALLY AGREED between the Agency and Owner
as follows:
Section 1. Contingent Financial Assistance To Owner.
In consideration of the significant economic benefits that Owner will bring to the San
Juan Capistrano community from the addition of the above described improvements,
Agencywill provide financial assistance to Owner under the following terms and conditions:
(a) Agency shall reimburse Owner funds in accordance with the following
apportionment formula. Owner shall be paid on a quarterly basis in an amount determined
in accordance with sales tax generated from new sales generated from the project
improvements as follows:
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1. Owner shall be paid from Agency funds annually an
amount equal to fifty percent (50%) of sales taxes generated
over and above the first $225,000 of sales taxes derived from
Owner' s entire automobile sales operation on Valle Road over
the course of a operating year, but in any event not to exceed
$35,000 in any one operating year. Thus, Owner shall not
receive any quarterly funds in and operating year should sales
taxes not exceed $225,000 in any given year.
2. This reimbursement obligation shall terminate when
Owner has been paid the total sum of Five Hundred Thousand
Dollars ($500,000.00), or at the end of twenty-two (22) years,
whichever occurs first.
3. Owner shall receive quarterly payments based upon
sales tax generation as described above approximately 120
days after the end of each calender quarter.
(b) "Operating year" shall mean (1) the twelve (12) calendar months beginning on
the commencement date of business activity (i.e., date of first sale) upon completion of
Project improvements, and (ii) each twelve (12) calendar months thereafter. If the
commencement date falls on a day other than the first day of a calendar month, the first
Operating Year shall consist of the twelve calendar months beginning with the first month
after the commencement date plus the period from the commencement date until the first
day of the first calendar month. The quarterly payment shall be made to Owner within
approximately (90) days following verification by City of the Tax revenues during the
immediate previous quarter.
For purposes of determining sales tax revenue deriving from leased
automobile sales, sales tax data shall be used only from sales data supplied from Owner's
primary leasing agent. Owner and Agency agree that the primary leasing agents are VW
Credit, Inc. and Capistrano Finance Corporation. Owner agrees to cooperate and make
every effort to have its leasing agent provide this data in a timely manner.
"Taxes and Sales Taxes" shall mean an amount equal to one hundred
percent (100%) of that portion of sales tax revenues derived by the City from Bradley Burns
Uniform Local Sales and Use Tax (Revenue and Taxation Code sections 7200, et seq.).
If there is change in the applicable law at any time during the term of this Agreement and
City, s share of sales tax revenues becomes less than one percent (1 %) of retail sales, that
reduction shall be reflected in the computations required under this agreement.
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2002.
Section 2. Owner's Projected Time -frame for Start Up.
Owner projects to have his improvements in place and operational by January 1,
Section 3. Term of Agreement.
This Agreement shall remain in full force and effect so long as the obligations under
this Agreement remain uncompleted, but in any event not later than twenty-two (22) years
from the date of execution of this Agreement.
Section 4. Dispute Resolution.
In the event of a dispute between the parties, each agrees to first formally meet and
confer regarding the matter. If the dispute cannot be resolved through a meet and confer
session, the matter will then be referred to non-binding mediation. If non-binding mediation
is not successful, the parties shall determine in writing whether binding arbitration is
appropriate. Thereafter, judicial remedies shall be available to resolve the dispute.
Section 5. Assignments
This agreement may not be assigned to any party without the written consent of the
agency.
Section 6. Notices.
Any notices given under this Agreement may be sent by first class mail, postage
prepaid, or by fax transmission as follows:
To Agency:
San Juan Capistrano Redevelopment Agency
Attn: George Scarborough, Executive Director
32400 Paseo Adelanto
San Juan Capistrano CA 92675
Telephone Number: 949/493-1171
Facsimile Number: 949/493-1053
To Owner:
Capistrano Volkswagen
Miles Brandon
32852 Valle Road
San Juan Capistrano CA 92675
Telephone Number: 949/837-4800
Facsimile Number: 949/493-4511
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Section 7. No Assignments Without Agency Consent.
This Agreement may not be assigned or hypothecated in any manner without the
written approval of the Agency.
Section 8. Entire Agreement.
This Agreement contains the entire Agreement and understanding of the parties
concerning the subject matter herein.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first written above.
Owner:
By:
Mil s Brandon
ATTEST:
By:"(/M &aa .Z'
'Dawn Sch nderl, Acting City Clerk
APPR VE AS TO FORM:
By:
John .Shaw,Ci Attorney
Agency:
By:104ct' A
DIANE BATHGATE, VICE I"N
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