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HomeMy WebLinkAbout00366C - MAC MAGRUDER CHEVROLET OPA 999 SPC OWNER PARTICIPATION AGREEMENT By and Between THE COMMQNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS and MAC MAGRUDER, dba Mac Magruder Chevrolet/Geo F82\383\0140840006\2155186.2 all/27195 0 TABLE OF CONTENTS SECTION 1. DEFINITIONS . . . . . . . . . . . . . . 1 1.1 Agency . . . . . . . . . . . . . . . 1 1 .2 Agreement . . . . . . . . . . 2 1 . 3 Basic Concept Drawings . . . . . . . . . 2 1 .4 Certificate of Completion . . . . . . . . . . . 2 1.5 CEQA . . . . . . . . . . . . . . . . . 1. 6 City . . . . . . . . . . . . . . . . . . . . 2 1.7 Days . . . . . . . . . . . . . . . . . . . . . . 2 2 1. 8 Declaration . . . . . . . . . . . . . 2 1.9 Effective Date . . . . . . . . . . . . . . 2 1. 10 Executive Director . . . . . . . . . . 2 1. 11 Force Maj eure . . . . . . . . . . . . . . 2 1 .12 Participant . . . . . . . . . . . . . . . . 3 1. 13 Project . . . . . . . . . . . . . . . 3 1.14 Promissory Note . . . . . . . . . . 3 1. 15 Intentionally Deleted . . . . . . . . . . . 3 1.16 Redevelopment Plan . . . . . . . . . . 3 1 .17 Redevelopment Plan Termination Date 3 1.18 Redevelopment Project Area . . . . . 3 1.19 Schedule of Performance . . . . . . . . . 3 1.20 Scope of Development . . . . . . . . . . . . 3 1 .21 Site . . . . . . . . . . . . . . . . . . . 3 1.22 Site Map . . . . . . . . . . . . . . . . 4 1 .23 Transfer . . . . . . . . . . . . . . . . . . . . 4 SECTION 2 . PURPOSE OF THIS AGREEMENT . . . . . . . . 4 SECTION 3 . REPRESENTATIONS AND WARRANTIES . . . . 5 3 . 1 Participant Representations and Warranties 5 3 . 1.1 Participant Lease . . . . . . . . . . . 5 3 .1.2 Litigation . . . . . . . . . . . . . 5 3 . 1.3 No Default . . . . . . . . . . . . 5 3 .1.4 No Violation . . . . . . . . . . . 5 3 . 1.5 No Possessory Interests . . . . . . . . . 5 3 .1. 6 No Bankruptcy . . . . . . . . . . . . . . 6 3 . 1. 7 No Misrepresentation . . . . . . . . . . 6 3 .1. 8 Disclosure . . . . . . . . . . . . 6 3 . 1.9 Due Execution . . . . . . . 6 3 .1. 10 No Extraneous Consideration 6 3 .2 Agency Representations and Warranties . . 6 3 .2 . 1 No Approvals . . . . . . . , , , , . . 6 3 .2 .2 Due Execution . . . . . . . . . . 6 3 .2 .3 Governmental Approvals . . . . . . . . . 6 SECTION 4 . DEVELOPMENT OF THE SITE . . . . . . 7 4 . 1 Construction of the Project . . . . . . . 7 4 .1. 1 Development in Accordance with Plans 7 4 . 1.2 Evolution of Development Plan . . . . . . 7 4 . 1.3 Other Governmental Permits . . . 7 4 . 1.4 Approval by Agency . . . . . . . . . . . 8 4 . 1.5 Agency Assistance . . . . . . . . . . . . 8 FS2\383\014084-000612155186.2 all/27/95 -i i- 4.1. 6 Cost of Construction . . . . . . 8 4. 1. 7 Construction Schedule; Reports . . . . . 9 4. 1. 8 Financing of the Project . . . . . . . . 9 4.2 Financial Capability . . . . . . . . . . . . . . 10 4 .2 . 1 Definition . . . . . . . . . . 10 4.2 .2 Submission to Agency . . . . . . 10 4.2 .3 Approval of Evidence of Financial Capability . . . . . . . . . . . . 10 4. 3 Liability; Worker' s Compensation; Automobile and Builder' s Risk Insurance . . . . . . . . 10 4 .4 Intentionally Deleted . . . . . . . . . . . 12 4.5 Rights of Access . . . . . . . . . . . . 12 4 . 6 Applicable Laws . . . . . . . . . . . . . . 12 4.7 Prohibition on Transfer . . . . . 12 4 . 8 Antidiscrimination During Construction 13 4 . 9 Relocation Assistance . . . . . . . . . . 13 4 . 10 Indemnification . . . . . . . . . . 13 4 . 11 Hazardous Substances . . . . . . . . . . . 13 4.12 Intentionally Deleted . . . . . . . . . . . . 17 4 . 13 Certificate of Completion . . . . . . . . . . . 17 SECTION 5 . USE OF THE SITE . . . . . . . . . . . . . 18 5 .1 No Inconsistent Uses . . . . . . . . . . . 18 5 .2 Declaration . . . . . . . . . . . . . . . . . . 18 5 .3 Participant Covenants . . . . . . . . . . . . . 18 SECTION 6 . DEFAULTS AND REMEDIES . . . . . . . . . 18 6 . 1 Participant Defaults . . . . . . . . . . 18 6 .2 Agency Defaults . . . . . . . . . . . . . . . . 20 6.3 Notice of Default . . . . . . . . . . 20 6.4 Remedies . . . . . . . . . . . . . . 20 6 .5 Agency' s Right to Terminate . . . . . . . 21 6. 6 Rights and Remedies are Cumulative . . . . . . . 21 SECTION 7, GENERAL PROVISIONS . . . . . . . . . . . . . 21 7 . 1 Standards of Review . . . . . . . . . 21 7.2 Governing Law . . . . . . . . . . . . . . . . . 21 7.3 Attorney' s Fees . . . . . . . . . . . . . 21 7.4 Notices, Demands, and Communications Between the Parties . . . . . . . . . . . . . . 22 7.5 Acceptance of Service of Process . . . . . 22 7. 6 Conflicts of Interest . . . . . . 22 7. 7 Nonliability of Agency Officials and Employees . 23 7. 8 Books and Records . . . . . . . . . . . . . . . 23 7. 8 .1 Maintenance of Books and Records 23 7. 8 .2 Right to Inspect . . . . . . . . . . . . 23 7.9 Ownership of Documents . . . . . . . . . 23 7. 10 Fair Meaning . . . . . . . . . . . . . . . . . . 23 7. 11 Titles and Captions . . . . . . . . . . . . . . 23 7. 12 Gender . . . . . . . . . . . . . . . . . . . . 23 7. 13 Modifications . . . . . . . . . . . . . 24 7. 14 Merger of Prior Agreements and Understandings 24 7. 15 No Third Parties Benefited . . 24 7. 16 Assurances to Act in Good Faith . . . . . . . . 24 F52\3831014084-000612155186.2 all/27/95 -i i i- 7. 17 Interpretation . . . . . . . . . . . . 24 7.18 Effect of Redevelopment Plan Amendment . . . . . 24 7.19 Time For Acceptance of Agreement By Agency 24 7.20 Counterparts . . . . . . . . . . . . . 25 7.21 Severability . _ . _ . . . . 25 7.22 Extension of Times of Performance . . . . . . . 25 EXHIBIT "A" LEGAL DESCRIPTION OF SITE EXHIBIT "B" SITE MAP EXHIBIT "C" SCOPE OF DEVELOPMENT EXHIBIT "D" LEASE EXHIBIT "E" SCHEDULE OF PERFORMANCE EXHIBIT "F" BASIC CONCEPT DRAWINGS EXHIBIT "G" CERTIFICATE OF COMPLETION EXHIBIT "H" DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS EXHIBIT "I" UNSECURED PROMISSORY NOTE EXHIBIT "J" DISCLOSURE OF HAZARDOUS MATERIALS F=383\0140840006\2UM6.2 a11/27/95 -iv- Mac Magruder Chevrolet/Geo OPA PA3 AGREEMENT #366C R997, 1-17-96 OWNER PARTICIPATION AGRESb�NT THIS OWNER PARTICIPATION AGREEMENT is entered into as of this G 5 day of 199� by and between THE COMMUNITY REDEVELOPMENT ENCY OF THE CITY PALM SPRINGS, CALIFORNIA, a public agency, corporate and politic ( "Agency") , and MAC MAGRUDER, dba Mac Magruder Chevrolet/Geo ( "Participant") . R E C I T A L S A. Agency is a public body, corporate and politic, exercising governmental functions and powers and organized and existing under the Community Redevelopment Law of the State of California (Health and Safety Code Section 33000, et sea. ) . B. Agency desires to implement the Redevelopment Plan for its South Palm Canyon Redevelopment Project Area by providing for the rehabilitation of a portion of the South Palm Canyon Redevelopment Project Area designated herein as the "Site" and the development of the "Project" thereon (as those terms are defined herein) . C. Participant has represented to Agency that: (i) Participant is the owner of a leasehold interest in the Site; (ii) Participant is prepared to redevelop the Site in accordance with the requirements of Agency; and (iii) Participant qualifies as an "Owner Participant" (as such term is defined herein) . D. The rehabilitation of the Site pursuant to this Agreement, and the fulfillment generally of this Agreement are in the vital and best interests of the "City" , as such term is defined herein, and the health, safety, morals and welfare of its residents and in accord with the public purposes and provisions of the applicable state and local laws and requirements under which the Project has been undertaken and is being assisted. NOW THEREFORE, in consideration of the promises and covenants contained herein, the above recitals, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: TERMS AND CONDITIONS SECTION 1 . DEFINITIONS. The following terms as used in this Agreement shall have the meanings given unless expressly provided to the contrary: 1 . 1 Agency. The term "Agency" shall mean THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic, having its offices at 3200 East FS2l8SS1014084-000612155186.2 .11/27/95 Tahquitz Canyon Way, Palm Springs, California 92262, and any assignee of, or successor to, the rights, powers, and responsibilities of Agency. 1.2 Agreement. The term "Agreement" or any reference to this "Agreement" shall mean this Owner Participation Agreement executed by and between Agency and Participant, including all exhibits attached hereto, which exhibits are incorporated herein by this reference and all other documents incorporated herein by reference. 1 .3 Basic Concept Drawings. The term "Basic Concept Drawings" shall mean the drawings attached hereto as Exhibit 'IF" submitted by Participant and approved by Agency. 1 .4 Certificate of Completion. The term "Certificate of Completion" shall mean that certificate attached hereto as Exhibit "G11 issued by Agency to Participant pursuant to the provisions of Section 6 . 1.5 below. 1. 5 CEO A. The term 110EQA11 shall mean the California Environmental Quality Act, Public Resources Code Section 21000 et sea. , as amended. 1. 6 City. The term "City" shall mean the CITY OF PALM SPRINGS, a municipal corporation, having its offices at 3200 East Tahquitz Canyon Way, Palm Springs, California 92263 . 1. 7 Days . The term "days" shall mean calendar days and the statement of any time period herein shall be calendar days and not working days, unless otherwise specified. 1. 8 Declaration. The term "Declaration" shall mean that certain Declaration of Covenants, Conditions and Restrictions attached hereto as Exhibit 11H11 and incorporated herein by reference. 1.9 Effective Date. The term "Effective Date" shall mean the date this Agreement is executed on behalf of Agency after a public hearing and approval by Agency. 1. 10 Executive Director. The term "Executive Director" shall mean the individual duly appointed to the position of Executive Director of the Agency. 1 . 11 Force Majeure. The term "Force Majeure" shall mean any war, insurrection, strike, lock-out, labor dispute, riot, flood, earthquake, fire, casualty, Act of God, act of the public enemy, epidemic, quarantine restriction, freight embargo, unavoidable lack of transportation, governmental restriction, unusually severe weather, inability to secure necessary labor, materials or tools, delay of any contractor, subcontractor or supplier, act of the other party, act or failure to act of City or any other public or governmental agency or entity (except that any act or failure to act of City or Agency shall not excuse performance by Agency) , or FS2\383\014084-0006\2155186.2 *11127/95 -2- 0 0 any other cause beyond the control or without the fault of the party claiming an extension of time to perform. 1.12 Participant. The term "Participant" shall mean Mac Magruder, whose address is 999 South Palm Canyon Drive, Palm Springs, California 92262 and any permissible assignee or successor pursuant to Section 4. 1. 13 below. 1. 13 Project . The term "Project" shall mean the work of improvements upon the Site set forth in the Scope of Development . The Project shall be performed in accordance with the approved Basic Concept Drawings, Development Project Plans, and Final Building Plans . 1.14 Promissory Note. The term "Promissory Note" shall mean that certain Unsecured Promissory Note attached hereto as Exhibit "I" and incorporated herein by reference. 1. 15 Intentionally Deleted. 1. 16 Redevelopment Plan. The term "Redevelopment Plan" shall mean the Redevelopment Plan for the Redevelopment Project Area, which was adopted by Ordinance No. 1203 of the City Council of City on December 30, 1983 and as the Redevelopment Plan has been amended from time to time. A copy of the Redevelopment Plan is on file in the Office of the City Clerk of the City. The Redevelopment Plan is incorporated herein by this reference and made a part hereof as though fully set forth herein. 1. 17 Redevelopment Plan Termination Date. The term "Redevelopment Plan Termination Date" shall mean the date the Redevelopment Plan expires, which date is December 30, 2013 . 1. 18 Redevelopment Project Area. The term "Redevelopment Project Area" shall mean the South Palm Canyon Redevelopment Project Area which is located in the City of Palm Springs, California. The exact boundaries of the Redevelopment Project Area are specifically described in the Redevelopment Plan. 1. 19 Schedule of Performance. The term "Schedule of Performance" shall mean that certain schedule attached hereto as Exhibit "Ell setting forth the times upon which performance by the parties under this Agreement is due. 1.20 Scope of Development. The term "Scope of Development" shall mean that certain exhibit attached hereto as Exhibit "C" and incorporated herein by reference which sets forth the terms of the Project. 1.21 Site. The term, "Site" shall mean that certain real property located in the City of Palm Springs, County of Riverside, State of California commonly known as 999 South Palm Canyon Drive and more particularly described on Exhibit "A" and depicted on the Site Map. FS2\383\014084-0006\2155186.2 all/27/95 -3- 1.22 Site Map. The term ,Site Map,, shall mean the map attached hereto as Exhibit "B" and incorporated herein by reference depicting the location of the Site. 1.23 Transfer. The term "Transfer" shall mean any assign- ment, hypothecation, mortgage, pledge, conveyance, lease, sale, exchange, gift, or encumbrance of all or any portion of this Agreement, the Site, or the improvements thereon, whether voluntary, involuntary or by operation of law. A Transfer shall also include the transfer to any person or group of persons acting in concert of twenty-five percent (2516) or more of the present ownership and/or control of Participant, taking all transfers into account on a cumulative basis. In the event Participant or its successor is a corporation or trust, such transfer shall refer to the transfer of the issued and outstanding voting rights or capital stock of Participant, or of the beneficial interests of such trust; in the event that Participant is a limited or general partnership, such transfer shall refer to the transfer of more than twenty-five percent (25%) of the limited or general partnership interests; in the event that Participant is a joint venture, such transfer shall refer to the transfer of more than twenty-five percent (25%-) of the ownership and/or control of any such joint venture partner, taking all transfers into account on a cumulative basis. SECTION 2 . PURPOSE OF THIS AGREEMENT. This Agreement and the Exhibits attached hereto are intended to effectuate the Redevelopment Plan for the Redevelopment Project Area by providing for the development of the Project on the Site. Participant has agreed to participate in the redevelopment of the Site by entering into this Agreement with Agency. The development of the Site pursuant to this Agreement, and the fulfillment generally of this Agreement, are in the best interests of the City and the welfare of its residents, and are in accordance with the public purposes and provisions of applicable federal, state, and local laws and requirements under which the Project has been undertaken and is being assisted. This Agreement is entered into by the Agency pursuant to its authority under the Community Redevelopment Law of the State of California, Health and Safety Code Sections 33000 et seo. (all statutory references herein are to the Health and Safety Code unless otherwise provided) ; which authorizes the Agency to make agreements with owners, purchasers and lessees of property in the Redevelopment Project Area providing for the development of property in conformity with the Redevelopment Plan, and providing that the Agency retain controls and establish restrictions or covenants running with the land so that the property will be developed, operated, and used in conformity with this Agreement and the Redevelopment Plan (see Health and Safety Code Sections 33380, 33381, 33437-33439 and 33339) . F52\383\014084-0"\2155186.2 all/27/95 -4- 0 SECTION 3 . REPRESENTATIONS AND WARRANTIES . 3 . 1 Participant Representations and Warranties . Participant hereby makes the following representations, covenants, and warranties for the benefit of Agency, and Agency' s successors and assigns, and acknowledges that the execution of this Agreement by Agency has been made, in MATERIAL reliance by Agency on such representations and warranties : 3 . 1. 1 Participant Lease. As of the Effective Date, Participant has a leasehold interest in the Site. The lease is in full force and effect and a true and correct copy of the lease and all amendments thereto is attached hereto as Exhibit I'D" and incorporated herein by reference. The remaining term of the lease is at least ten (10) years . The landlord under the lease does not have the right to terminate the lease for any reason other than a default by Participant. Participant has no knowledge of the occurrence of any event which with the passage of time, the giving of notice or both would constitute a default under the lease by landlord or Participant. 3 . 1.2 Litigation. There are no pending or threatened claims, actions, proceedings, or lawsuits of any kind, whether for personal injury, property damage, landlord-tenant disputes, property taxes, or otherwise, that could adversely affect title to or the operation or value of the Site or which questions the validity or enforceability of this transaction, nor is there any governmental investigation of any type or nature, pending or threatened, against or relating to the Site or the transactions contemplated hereby (other than those conducted by City and Agency) . 3 . 1 .3 No Default. The execution and delivery of this Agreement will not constitute or result in any default or event that with notice or the lapse of time, or both, would be a default, breach, or violation of any lease, mortgage, deed of trust, or other agreement, instrument or arrangement by which Participant or the Site are bound or any event which would permit any party to terminate an agreement or accelerate the maturity of any indebtedness or other obligation affecting Participant or the Site. 3 . 1.4 No Violation. The execution and delivery of this Agreement and the consummation of the transactions contemplated herein will not violate any provision of, or require any consent, authorization, or approval under any law or administrative regula- tion or any other order, award, judgment, writ, injunction or decree applicable to, or any governmental permit or license issued to, Participant or relating to the Site. 3 . 1. 5 No Possessory Interests. Participant has the right of possession of the Site on the scheduled date of commencement of construction of the Project set forth in the Schedule of Performance, free from any tenant leases, tenancies, B52\383\0140840006\2155186.2 all/27/95 -,5- licenses, or other similar occupancy agreements that could interfere with Participant' s right to develop the Project . 3 .1. 6 No Bankruptcy. Neither Participant nor the entity constituting Participant, if any, has filed or been the subject of any filing of a petition under the Federal Bankruptcy Law or any insolvency laws, or any laws for the discharge of indebtedness or for the reorganization of debtors . 3 .1.7 No Misrepresentation. No representation, warranty, or covenant of Participant in this Agreement, or in any document or certificate furnished or to be furnished to Agency pursuant to this Agreement, contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary to make the statements contained herein or therein not misleading. 3 . 1. 8 Disclosure. Participant has disclosed all infor- mation concerning the Site of which Participant is aware which may materially affect the value of the Site and/or Participant' s continued ability to develop and utilize the Site as provided in this Agreement . 3 . 1.9 Due Execution. This Agreement has been duly exe- cuted by Participant and constitutes a valid, binding, and enforceable obligation of Participant . In the event Participant is an individual and executing this Agreement without a spouse, the Site is the Participant's sole and separate property. 3 . 1 .10 No Extraneous Consideration. Participant has not paid or given to, and will not pay or give to, the Agency or City or any official or agent of the Agency or City any money or other consideration for obtaining this Agreement, except as expressly provided herein. 3 .2 Agency Representations and Warranties . Agency hereby represents and warrants for the benefit of Participant and Participant' s successors and assigns, that the following facts are true as of the execution of this Agreement: 3 .2 . 1 No Approvals. No approvals or consents not here- tofore obtained by Agency are necessary in connection with the execution of this Agreement by Agency or with the performance by Agency of Agency' s obligations hereunder. 3 .2 .2 Due Execution. This Agreement has been duly exe- cuted by Agency or its duly authorized officers or agents and constitutes a valid, binding, and enforceable obligation of Agency. 3 .2 . 3 Governmental Approvals . Notwithstanding anything contained herein to the contrary, the Agency makes no representa- tions or warranties with respect to the approvals required by any other governmental entity or with respect to approvals hereinafter required from the City or the Agency. The Agency reserves full FS2\383\014084-0006\2155186.2 a11/27/95 -6- 0 police power authority over the Project and Participant acknowledges that the City retains such full police power as well . Nothing in this Agreement shall be deemed to be a prejudgment or commitment with respect to such items nor to guaranty that such approvals or permits will be issued within any particular time or with or without any particular conditions . SECTION 4 . DEVELOPMENT OF THE SITE. 4 .1 Construction of the Project. 4. 1. 1 Development in Accordance with Plans . Participant shall develop the Project in accordance with this Agreement, the Scope of Development, the approved Basic Concept Drawings, and the plans and permits approved by Agency and City pursuant to Section 4 .3 .2, including any changes thereto as may be subsequently approved in writing by both Participant and Agency and, if necessary, City. As completed, the Project (a) shall comply with all applicable laws and ordinances of all governmental authorities, including, without limitation, all laws and ordinances necessary to permit development of the Site as permitted by this Agreement; (b) except as expressly provided herein, will be entirely on the Site and will not encroach upon the land of others or overbound any easement or right-of-way; and (c) will be wholly in compliance with any enforceable building restriction laws, however established, and will not violate any enforceable use, easement, license, covenant, condition or other restriction affecting the Site. 4.1.2 Evolution of Development Plan. Concurrently with the approval of this Agreement, the Agency has approved the Participant' s Basic Concept Drawings . On or before the date set forth in the Schedule of Performance, Participant shall submit to the City preliminary, and thereafter final drawings and specifications for development of the Site and each parcel thereof in accordance with the Scope of Development, and all in accordance with the City' s requirements . The term preliminary and final drawings shall be deemed to include site plans, building plans and elevations, grading plans, if applicable, landscaping plans, parking plans, material pallets, a description of structural, mechanical, and electrical systems, and all other plans, drawings and specifications . Final drawings will be in sufficient detail to obtain a building permit. Said plans, drawings and specifications shall be consistent with the Scope of Development and the various development approvals referenced hereinabove, except as such items may be amended by City (if applicable) and by mutual consent of Agency and Participant. Plans, (concept, preliminary and construction) shall be progressively more detailed and will be approved if a logical evolution of plans, drawings or specifications previously approved. 4. 1. 3 Other Governmental Permits . Participant shall, at its own expense and before commencement of construction, rehabilitation, restoration, revitalization, or development of any FS21SM14084-000612155186.2 .11/27/95 -7- buildings, structures, or other work of improvement upon the Site, secure or cause to be secured any and all permits and approvals which may be required by City or any other governmental agency affected by such construction, development or work to be performed by Participant pursuant to the Scope of Development, including but not limited to, necessary building permits and all approvals required under CEQA. Not by way of limiting the foregoing, in developing and constructing the Project, Developer shall comply with all applicable development standards in City' s Municipal Code and shall comply with all building code, landscaping, signage and parking requirements except as may be permitted through approved variances and modifications. Participant shall not be obligated to commence construction if any such permit is not issued despite good faith effort by Participant. Participant shall pay all normal and customary fees and charges applicable to such permits and any fees and charges hereafter imposed by City or Agency which are standard for and uniformly applied to similar projects in the City. 4 . 1.4 Approval by Agency. The Agency shall approve or disapprove any submittal made by the Participant pursuant to this Agreement within thirty (30) days after such submittal . All submittals made by Participant will note in bold type the thirty (30) day time limit and specifically reference this Agreement and this Section 4. 1.4 . Any disapproval shall state in writing the reason for the disapproval and the changes which the Agency requests to be made. After Participant resubmits the corrected submittal, Agency shall have an additional thirty (30) days for the review of the resubmittal but if the Agency disapproves the resubmittal, then the cycle shall repeat, until the Agency' s approval has been obtained. 4 . 1.5 Agency Assistance. Subject to Participant' s compliance with (i) applicable City and Agency development standards for the Site and (ii) all applicable laws and regulations governing such matters as public hearings, site plan review and environmental review, Agency agrees to provide reasonable assistance to Participant, at no cost to Agency, in the expeditious processing of Participant' s submittals required under this Agreement in order that Participant may obtain a final City action on such matters on or before the date set forth in the Schedule of Performance; provided that Agency does not warrant or represent that such approval shall be obtained. In connection therewith, Agency agrees to assist Participant in scheduling Participant' s sign program for the Project, which sign program was submitted to the Executive Director of the Agency on August 31, 1995 by Swain Sign, Inc. and is on file with the Agency, for approval by the City Council of City concurrently with the approval of this Agreement by the Agency Board. 4 . 1 . 6 Cost of Construction. Participant shall bear all costs of preparing and developing the Project and constructing all improvements thereon, including, but not limited to any and all costs for demolition and clearance of existing surface and subsurface improvements inconsistent with the Project, FS21383\014084-0006\2155186.2 all/27/95 -8- 0 architectural and engineering plans, preparation of the Site, costs associated with meeting applicable seismic standards, interim and permanent financing, broker's and leasing commissions, and fees or charges for development and building, except as expressly set forth in Section 4 . 1. 8 of this Agreement. 4 . 1. 7 Construction Schedule; Reports. Participant shall commence and complete construction of the Project within the times set forth in the Schedule of Performance. Once construction is commenced, Participant shall diligently pursue such construction to completion and Participant shall not abandon such construction for more than thirty (30) consecutive days . The decision of the Executive Director shall be final and conclusive upon the parties to this Agreement. Participant shall keep Agency informed of the progress of construction and submit to Agency written reports of the progress of construction when and in the form requested by Agency, but not less than monthly. 4 .1. 8 Financing of the Project . Subject to the terms of this Agreement and the availability of tax increment funds not previously committed to other projects, the Agency agrees to loan Participant a sum not to exceed TWO HUNDRED THOUSAND DOLLARS ($200, 000 . 00) ( "Loan") for the construction of the Project on the Site. Concurrently with the execution of this Agreement, Participant will execute and deliver to Agency the Promissory Note. Within sixty (60) days of the issuance of a building permit from the City for the construction of the Project, Agency shall disburse to Participant the sum of FORTY THOUSAND DOLLARS ($40, 000 . 00) , which sum is to be held in trust by Participant to be used solely for the cost to construct the Project . Additional disbursements of the Loan shall be made annually commencing on the date that is sixty (60) days after the date the City receives from the Franchise Tax Board a report setting forth the annual sales tax revenues received by the City with respect to the business operated on the Site for the fiscal year immediately succeeding the fiscal year in which this Agreement was executed and continuing for a period of seven (7) years thereafter or until the amount of the Loan has been fully disbursed, whichever occurs sooner. By way of example, if this Agreement is executed in the 1995 fiscal year, the first payment would be made within sixty. (60) days of the date the City receives the annual sales tax report for the 1996 fiscal year. The amount to be disbursed to Participant on each annual disbursement date shall be the amount of annual sales tax revenues received by the City for the applicable fiscal year in excess of EIGHTY THOUSAND DOLLARS ($80, 000 . 00) ; provided, however, that the amount to be disbursed to Participant in any one year shall not exceed the lesser of (i) TWENTY-FIVE THOUSAND DOLLARS ($25, 000 . 00) ; (ii) the aggregate sum expended by Participant through the end of said fiscal year for the cost of constructing the Project, less the amount of the Loan previously disbursed to Participant; and (iii) the amount of available tax increment revenue available to Agency not previously committed to other projects . Prior to the disbursement of any funds under this Agreement, other than the initial disbursement, Participant shall submit to Agency copies of FS2\383\014084-0006\2155186.2 •11/27/95 -9- 0 0 paid invoices and such other documents as Agency may reasonably request documenting the amount expended by Participant on the Project. Should the amount of the Loan not be fully disbursed by the end of said seven (7) year period, the Agency shall have no obligation to disburse the remaining balance of the Loan; provided, however, that the seven (7) year period shall be extended for a period equal to the duration of any event of Force Majeure. 4 .2 Financial Capability. 4.2 .1 Definition. The term "Evidence of Financial Capability" shall mean documentation reasonably satisfactory to the Executive Director establishing that Participant has the funds available to construct the Project on the Site. 4 .2 .2 Submission to Agency. Participant shall submit its Evidence of Financial Capability to the Agency for approval by the Executive Director on or before the date set forth in the Schedule of Performance. 4 .2 .3 Approval of Evidence of Financial Capability. The Executive Director will notify Participant of his or her decision with respect to the Evidence of Financial Capability within thirty (30) days of Submission to the Agency by Participant. 4 . 3 Liabilit • Worker' s Compensation, Automobile and Builder' s Risk Insurance. Prior to the commencement of any construction by Participant on the Site, Participant shall procure and maintain, at its sole cost and expense, in a form and content satisfactory to Agency, during the entire term of this Agreement, the following policies of insurance: (a) Commercial General Liability Insurance. A policy of comprehensive general liability insurance written on a per occurrence basis in an amount not less than either (i) a combined single limit of TWO MILLION DOLLARS ($2 , 000, 00 . 00) or (ii) bodily injury limits of ONE MILLION DOLLARS ($1, 000, 000 . 00) per person, TWO MILLION DOLLARS ($2 , 000, 00 . 00) per occurrence and ONE MILLION DOLLARS ($1, 000, 000 . 00) products and completed operations and property damage limits of ONE MILLION DOLLARS ($1, 000, 000 . 00) per occurrence and ONE MILLION DOLLARS ($1, 000, 000 . 00) in the aggregate. Said policy is to include Blanket Contractual Liability, Completed Operations, Owner' s Broad Form Property Damage, Installation Floater, Independent Contractor, Personal Injury and deletion of the "X" , "Y" and "U" exclusions . (b) Worker' s Compensation Insurance. A policy of worker' s compensation insurance in such amount as will fully comply with the laws of the State of California and which shall indemnify, insure and provide legal defense for both the Participant, Agency and the City against any loss, claim or damage arising from any injuries or occupational diseases occurring to any worker employed by or any persons retained by FS2\383\014084-0006\2155186.2 all/27/95 -1 0_ the Participant in the course of carrying out the work or services contemplated in this Agreement. (c) Automotive Insurance. A policy of comprehensive automobile liability insurance written on a per occurrence basis in an amount not less than either (i) bodily injury liability limits of $250, 000 .00 per person and $500, 000 . 00 per occurrence and property damage liability limits of $100, 000 .00 per occurrence and $250, 000 . 00 in the aggregate or (ii) combined single limit liability of $500, 000 .00. Said policy shall include coverage for owned, non-owned, leased and hired cars . (d) Property Insurance. A policy of property insurance covering "all risks" written on a replacement cost basis . All of the above policies of insurance shall be primary insurance and shall name Agency, City, and their officers, employees and agents as additional insureds . The insurer shall waive all rights of subrogation and contribution it may have against Agency, City, and their officers, employees and agents and their respective insurers . All of said policies of insurance shall provide that said insurance may not be amended or cancelled without providing thirty (30) days prior written notice by registered mail to Agency and City. In the event any of said policies of insurance are cancelled, the Participant shall, prior to the cancellation date, submit new evidence of insurance in conformance with this Section 4 . 1.9 to the Executive Director. No work or services under this Agreement shall commence until the Participant has provided Agency with Certificates of Insurance or appropriate insurance binders evidencing the above insurance coverages and said Certificates of Insurance or binders are approved by Agency. The policies of insurance required by this Agreement shall be satisfactory only if issued by companies qualified to do business in California, rated "A" or better in the most recent edition of Best Rating Guide, The Key Rating Guide or in the Federal Register, and only if they are of a financial category Class VII or better, unless such requirements are waived by the Risk Manager of the Agency ( "Risk Manager") due to unique circumstances . Participant shall provide in all contracts with contractors, subcontractors, architects and engineers that said contractor or subcontractor shall maintain the same policies of insurance required to be maintained by Participant pursuant to this Section 4 .3 . The Participant agrees that the provisions of this Section 4 .3 shall not be construed as limiting in any way the extent to which the Participant may be held responsible for the payment of damages to any persons or property resulting from the Participant' s activities or the activities of any person or persons for which the Participant is otherwise responsible. FS2\383\014084-0006\2155186.2 all/27/95 4.4 Intentionally Deleted. 4 .5 Rights of Access. Representatives of Agency shall have the reasonable right of access to the Site without charges or fees, at any time during normal construction hours during the period of construction, for the purpose of assuring compliance with this Agreement including, but not limited to, the inspection of the work of construction being performed by or on behalf of Participant. ,Such representatives of Agency shall be those who are so identified in writing to Participant by the Executive Director of Agency. Each such representative of Agency shall identify himself or herself at the job site office upon his or her entrance to the Site and shall provide owner or the construction superintendent or similar person in charge on the Site a reasonable opportunity to have a representative accompany him or her during the inspection. If the Agency, in its discretion, determines that any work or materials are not in conformity with the Final Building Plans or any other provisions of this Agreement, or any laws or ordinances, or not otherwise in conformity with the laws of the City, Agency may stop the work and order replacement or correction of any such work or materials on any portion of the Site, unless a similar use of such materials has been previously approved by Agency for use on the Site. Inspection by Agency of the Site or any improvements thereon is not to be construed as an acknowledgment, acceptance or representation by Agency that there has been compliance with any plans approved pursuant to this Agreement or that the Site or any improvements thereon will be free from defect in design or construction or that the same is free of any faulty material or workmanship. Agency shall nullify, defend and hold Participant harmless from any injury or property damage caused or liability arising out of Agency' s exercise of this right of access . 4 . 6 Applicable laws. Participant shall construct the Project in conformity with all applicable laws, including all applicable Federal and State labor laws . 4 . 7 Prohibition on Transfer. Prior to the termination of the Declaration, Participant shall not Transfer this Agreement or any of Participant' s rights hereunder, or any interest in the Site or in the improvements thereon, directly or indirectly, voluntarily or by operation of law, except as provided below, without the prior written approval of Agency, and any such purported Transfer without such approval shall be null and void. In considering whether it will grant approval to any Transfer by Participant before the recordation of the Certificate of Completion, which Transfer requires Agency approval, Agency shall consider factors such as (i) whether the completion of the Project is jeopardized, if the Project has not been completed; (ii) the financial strength and capability of the proposed transferee to perform Participant' s obligations hereunder; (iii) the proposed transferee's experience and expertise in the planning, financing, development, ownership, and operation of similar projects; and (iv) whether the Transfer is for the purpose of financing the construction or development of the Project. A Transfer for financing purposes shall not be approved FS2\383\014084-0006\2155186.2 all/27/95 -12- by the Agency if the financing exceeds eighty percent (8016) of the construction or development costs of the Project or if the loan documents do not state that the loan proceeds must be used for the construction or development of the Project. In the absence of specific written agreement by Agency, prior to the recordation of a Certificate of Completion, no Transfer by Participant of all or any portion of its interest in the Site or this Agreement (including, without limitation, a Transfer not requiring Agency approval hereunder) shall be deemed to relieve Participant or any successor party from any obligations under this Agreement. In addition, no attempted Transfer of any of Participant' s obligations hereunder shall be effective unless and until the successor party executes and delivers to Agency an assumption agreement in a form approved by the Agency assuming such obligations . 4 . 8 Antidiscrimination During Construction. Participant, for itself and its successors and assigns, agrees that during the construction of the Project, Participant will not discriminate against any employee or applicant for employment because of race, color, creed, religion, sex, marital status, ancestry, or national origin. 4 . 9 Relocation Assistance. Participant waives any claims that it or any entities owned or controlled by it, and its successors and assigns may have to receive relocation assistance or benefits arising out of the work to be performed pursuant to this Agreement . 4 . 10 Indemnification. During the period of construction of any of the improvements pursuant to this Agreement and until such time as is issued a Certificate of Completion, Participant agrees to and shall indemnify and hold the Agency and the City harmless from and against all liability, loss, damage, cost or expenses (including reasonable attorneys' fees and court costs) arising from or as a result of the death of any person or any accident, injury, loss, or damage whatsoever caused to any person or to the property of any person which shall occur on any of the properties subject to this Agreement and which shall be directly or indirectly caused by the acts done thereon or any errors or omissions of the Participant or its agents, servants, employees or contractors. Participant shall not be responsible for (and such indemnity shall not apply to) any acts, errors or omissions of the Agency or the City or their respective agents, servants, employees or contractors . Agency and City shall not be responsible for any acts, errors or omissions of any person or entity except Agency and City and their respective agents, servants, employees or contractors, subject to any and all statutory and other immunities. 4 . 11 Hazardous Substances . Participant represents and warrants that, after due and diligent inquiry and investigation, there exists no "Hazardous Materials" (as such term is herein defined) nor oil wells, underground storage tanks, or pipelines in, FS2\383\014084-0006\2155186.2 all/27/95 -73- 0 on, under, or about the Site except as set forth in Exhibit "J" attached hereto and incorporated herein by reference. Participant understands and agrees that in the event Participant incurs any loss or liability concerning Hazardous Materials and/or oil wells and/or underground storage tanks and/or pipelines whether attributable to events occurring prior to or following the Effective Date, then Participant may look to current or prior owners of the Site, but under no circumstances shall Participant look to Agency or City for any liability or indemnification regarding Hazardous Materials and/or oil wells and/or underground storage tanks and/or pipelines. Participant, and each of the entities constituting Participant, if any, from and after the Effective Date, hereby waives, releases, remises, acquits and forever discharges Agency, City, their directors, officers, shareholders, employees, and agents, and their respective heirs, successors, personal representatives and assigns, of and from any and all Environmental Claims, Environmental Cleanup Liability and Environmental Compliance Costs, as those terms are defined below, and from any and all actions, suits, legal or administrative orders or proceedings, demands, actual damages, punitive damages, loss, costs, liabilities and expenses, which concern or in any way relate to the physical or environmental conditions of the Site, the existence of any Hazardous Material thereon, or the release or threatened release of Hazardous Materials therefrom, whether existing prior to, at or after the Effective Date. It is the intention of the parties pursuant to this release that any and all responsibilities and obligations of Agency and City, and any and all rights, claims, rights of action, causes of action, demands or legal rights of any kind of Participant, its successors, assigns or any affiliated entity of Participant, arising by virtue of the physical or environmental condition of the Site, the existence of any Hazardous Materials thereon, or any release or threatened release of Hazardous Material therefrom, whether existing prior to, at or after the Effective Date, are by this Release provision declared null and void and of no present or future force and effect as to the parties . In connection therewith, Participant and each of the entities constituting Participant, expressly agree to waive any and all rights which said party may have under Section 1542 of the California Civil Code which provides as follows : "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor. " Participant and each of,the entities constituting Participant, shall, from and after the Effective Date, defend, indemnify and hold harmless Agency, City and their officers, directors, employees, agents and representatives (collectively, the "Indemnified Parties" ) from and against any and all Environmental FS2\383\014084-0006\2155186.2 all/27195 -14- Claims, Environmental Cleanup Liability, Environmental Compliance Costs, and any other claims, actions, suits, legal or administrative orders or proceedings, demands or other liabilities resulting at any time from the physical and/or environmental conditions of the Site whether before or after the Effective Date or from the existence of any Hazardous Materials or the release or threatened release of any Hazardous Materials of any kind whatsoever, in, on or under the Site occurring at any time whether before or after the Effective Date, including but not limited to, all foreseeable and unforeseeable damages, fees, costs, losses and expenses, including any and all attorneys, fees and environmental consultant fees and investigation costs and expenses, directly or indirectly arising therefrom, and including fines and penalties of any nature whatsoever, assessed, levied or asserted against any Indemnified Parties to the extent that the fines and/or penalties are the result of a violation or an alleged violation of any Environmental Law. Participant further agrees that in the event Participant obtains, from former or present owners of the Site or any other persons or entities, releases from liability, indemnities, or other forms of hold harmless relating to the subject matter of this section, Participant shall use its diligent efforts to obtain for Agency and City the same releases, indemnities and other comparable provisions. For purposes of this Section 4. 12, the following terms shall have the following meanings : (a) "Environmental Claim" means any claim for personal injury, death and/or property damage made, asserted or prosecuted by or on behalf of any third party, including, without limitation, any governmental entity, relating to the Site or its operations and arising or alleged to arise under any Environmental Law. (b) "Environmental Cleanup Liability" means any cost or expense of any nature whatsoever incurred to contain, remove, remedy, clean up, or abate any contamination or any Hazardous Materials on or under all or any part of the Site, including the ground water thereunder, including, without limitation, (i) any direct costs or expenses for investigation, study, assessment, legal representation, cost recovery by governmental agencies, or ongoing monitoring in connection therewith and (ii) any cost, expense, loss or damage incurred with respect to the Site or its operation as a result of actions or ,measures necessary to implement or effectuate any such containment, removal, remediation, treatment, cleanup or abatement . (c) "Environmental Compliance Cost" means any cost or expense of any nature whatsoever necessary to enable the Site to comply with all applicable Environmental Laws in effect . "Environmental Compliance Cost" shall include all costs necessary to demonstrate that the Site is capable of such compliance. FS213831014084-000612155186.2 all/27/95 -1 5_ (d) "Environmental Law" means any federal, state or local statute, ordinance, rule, regulation, order, consent decree, judgment or common-law doctrine, and provisions and conditions of permits, licenses and other operating authoriza- tions relating to (i) pollution or protection of the environment, including natural resources, (ii) exposure of persons, including employees, to Hazardous Materials or other products, raw materials, chemicals or other substances, (iii) protection of the public health or welfare from the effects of by-products, wastes, emissions, discharges or releases of chemical substances from industrial or commercial activities, or (iv) regulation of the manufacture, use or introduction into commerce of chemical substances, including, without limitation, their manufacture, formulation, labeling, distribution, transportation, handling, storage and disposal . (e) "Hazardous Material" is defined to include any hazardous or toxic substance, material or waste which is or becomes regulated by any local governmental authority, the State of California, or the United States Government. The term "Hazardous Material" includes, without limitation, any material or substance which is: (i) petroleum or oil or gas or any direct or derivate product or byproduct thereof; (ii) defined as a "hazardous waste, " "extremely hazardous waste" or "restricted hazardous waste" under Sections 25115 , 25117 or 25122 . 7, or listed pursuant to Section 25140, of the California Health and Safety Code, Division 20, Chapter 6 . 5 (Hazardous Waste Control Law) ; (iii) defined as a "hazardous substance" under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6. 8 (Carpenter-Presley- Tanner Hazardous Substance Account Act) ; (iv) defined as a "hazardous material, " "hazardous substance, " or "hazardous waste" under Sections 25501 (j ) and (k) and 25501 .1 of the California Health and Safety Code, Division 20, Chapter 6 .95 (Hazardous Materials Release Response Plans and Inventory) ; (v) defined as a "hazardous substance" under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6 . 7 (Underground Storage of Hazardous Substances) ; (vi) "used oil" as defined under Section 25250 . 1 of the California Health and Safety Code; (vii) asbestos; (viii) listed under Chapter 11 of Division 4 . 5 of Title 22 of the California Code of Regulations or defined as hazardous or extremely hazardous pursuant to Chapter 10 of Division 4 . 5 of Title 22 of the California Code of Regulations; (ix) defined as waste or a hazardous substance pursuant to the Porter-Cologne Act, Section 13050 of the California Water Code; (x) designated as a "toxic pollutant" pursuant to the Federal Water Pollution Control Act, 33 U.S.C. § 1317; (xi) defined as a "hazardous waste" pursuant to the Federal Resource Conservation and Recovery Act, 42 U.S .C. § 6901 et sea. (42 U.S .C. § 6903) ; (xii) defined as a "hazardous substance" pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S .C. § 9601 et sea . (42 U.S.C. § 9601) ; (xiii) defined as "Hazardous Material" pursuant to the FS2\3831014094-000612155186.2 all/27/95 -1 6- • • Hazardous Materials Transportation Act, 49 U.S .C. § 5101 et seq. ; or (xiv) defined as such or regulated by any °Superfund" or "Superlien" law, or any other federal, state or local law, statute, ordinance, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning Hazardous Materials and/or oil wells and/or underground storage tanks and/or pipelines, as now, or at any time hereafter, in effect. Notwithstanding any other provision of this Agreement, Participant' s release and indemnification as set forth in the provisions of this Section, as well as all provisions of this Section shall survive the termination of this Agreement and shall continue in perpetuity. 4 . 12 Intentionally Deleted. 4 . 13 _C_ertificate of Completion. Upon written request by Participant, and upon satisfactory completion of the Project, Agency shall issue to Participant a Certificate of Completion. The Certificate of Completion shall be, and shall so state, a conclusive determination of satisfactory completion of the Project required by this Agreement, and of full compliance with the terms of this Agreement relating to commencement and completion of the Project. After the date Participant is entitled to issuance of the Certificate of Completion, and notwithstanding any other provision of this Agreement to the contrary, any party then owning or thereafter purchasing, leasing, or otherwise acquiring any interest in the Site shall not (because of such ownership, purchase, lease, or acquisition) incur any obligation or liability under this Agreement, except that such party shall be bound by the covenants that survive issuance of the Certificate of Completion, as set forth in Section 4 .5 above and in the Declaration. A Certificate of Completion shall not be issued for less than the complete improvements and development of the entire Site. The Certificate of Completion is not a notice of completion as referred to in California Civil Code Section 3093 . If Agency refuses or fails to furnish a Certificate of Completion after written request from Participant, Agency shall, within ten (10) days of the written request, provide the Participant a written statement of the reasons Agency refused or failed to furnish a Certificate of Completion. The statement shall also contain the Agency' s opinion of the action Participant must take to obtain a Certificate of Completion. If the Agency shall have failed to provide such written statement within said ten (10) day period, Participant shall be deemed entitled to the Certificate of Completion. If Agency refuses or fails to furnish the Certificate of Completion for the reason that specific items or materials are not available or landscaping is not complete, Agency shall issue the Certificate of Completion upon the posting by Participant with Agency of a cash deposit, bond or irrevocable letter of credit (in a form acceptable to Agency) in an amount representing the fair value of the work not yet completed. F52UM014084-0006\2155186.2 .11/27195 -1 7_ SECTION 5 . USE OF THE SITE. 5 . 1 No Inconsistent Uses . Participant covenants and agrees, for itself, its successors, its assigns, and every successor in interest to the Site, or any part thereof, that for the period beginning on the Effective Date and ending on the Redevelopment Plan Expiration Date, Participant and such successors shall not devote the Site to uses inconsistent with the Redevelopment Plan, the applicable zoning restrictions, this Agreement and the Declaration; provided that, in the event of any inconsistency, the provisions of the Redevelopment Plan shall prevail over all others and the provision of the Declaration shall prevail over this Agreement. 5 .2 Declaration. Concurrently with the execution of this Agreement, the Participant shall execute and record against the entire Site the Declaration. Each and every term, provision, agreement, covenant, condition and restriction contained in the Declaration is hereby expressly incorporated herein by reference as if fully set forth herein. The Declaration shall be signed and acknowledged by all parties having record title interest in the Site, shall make the Agency and City parties thereto and shall be enforceable by the Agency and the City. 5 .3 Participant Covenants . Agency is deemed a beneficiary of the terms and provisions of this Agreement and of the restrictions and covenants running with the land appearing in the Declaration for and in its own right for the purposes of protecting the interests of the community in whose favor and for whose benefit the covenants running with the land have been provided. The covenants in favor of Agency shall run without regard to whether Agency has been, remains or is an owner of any land or interest therein in the Site or in the Redevelopment Project Area and shall be effective as both covenants and equitable servitudes against the Site. Agency shall have the right, if any of the covenants set forth in this Agreement which are provided for its benefit are breached, to exercise all rights and remedies and to maintain all actions or suits at law or in equity or other proper proceedings to enforce the obligations under this Agreement. With the exception of the City, no other person or entity shall have any right to enforce the terms of this Agreement under a theory of third party beneficiary or otherwise. Upon the recordation of the Declaration, the covenants contained in this Agreement, except those covenants contained in the Declaration, shall become personal covenants of the Participant. SECTION 6 . DEFAULTS AND REMEDIES. 6 . 1 Participant Defaults . The occurrence of any one or more of the following events shall constitute an event of default by Participant hereunder if, after receiving written notice from Agency as provided in Section 6 . 3 below indemnifying such event, FS2\383\014084-000612155185.2 a11127195 -18- • ! Participant fails to cure said event within ten (10) days if such event is a monetary default or Participant fails to cure said default within thirty (30) days, if such event is a non-monetary default; provided that if such non-monetary default is not capable of being cured within thirty (30) days Participant commences to cure said event within ten (10) days and diligently and in good faith continues to cure the event of default: 6.1. 1 Participant fails to observe or perform any term or provision of this Agreement within the time set forth in this Agreement; 6. 1.2 Participant fails to timely obtain all required permits and approvals for the Project which shall be determined in the sole and absolute discretion of Agency; 6 . 1.3 Participant makes or delivers to Agency any statement, report, financial statement, or certificate that is not true or correct in any material respect; 6 . 1 .4 Participant applies for the appointment of a receiver, trustee, or custodian for any of Participant' s assets; 6 . 1. 5 Participant files a petition under any section or chapter of the Bankruptcy Code or any similar law or regulation; 6 . 1. 6 Participant makes a general assignment for the benefit of his creditors; 6. 1. 7 A petition under any section or chapter of the Bankruptcy Code or any similar law or regulation is filed against Participant, and such injunction, restraint, or petition is not dismissed within thirty (30) days after the entry or filing thereof; 6. 1. 8 Participant ceases to conduct his business substantially as now conducted; 6 . 1.9 Participant is enjoined, restrained, or in any way prevented by court order from conducting all or any material part of his business affairs; 6 . 1.10 Participant becomes insolvent or admits in writing his inability to pay its debts as they mature; or 6 . 1. 11 A notice of lien, levy, or assessment is filed of record with respect to all or any of Participant' s assets by the United States, or any department, agency or instrumentality thereof, or by any state, county, municipal, or other governmental agency, or if any taxes or debts owing at any time hereafter to any one of these becomes a lien or encumbrance upon any of Borrower' s assets or the Site and the same is not released within thirty (30) days after the same becomes a lien or encumbrance; provided that Participant shall have the right to contest in good faith and by FS2\383\0140840006\2155186.2 all/27/95 _19_ appropriate proceedings any such lien, levy or assessment if Participant provides Agency with a bond or indemnity satisfactory to Agency assuring the payment of such lien, levy, or assessment; 6.1. 12 Any of Participant' s representations and warranties set forth in Section 3 .1 of this Agreement is untrue or materially misleading. 6.2 Agency Defaults . The occurrence of any one or more of the following events shall constitute an Event of Default by Agency hereunder: 6.2 .1 Agency fails to observe or perform any term or provision of this Agreement within the time set forth in this Agreement and such failure is not cured to Participant' s reasonable satisfaction within thirty (30) days after Participant gives Agency written notice as provided in Section 6.3 below identifying such failure; provided that if said default cannot be cured within said thirty (30) day period, Agency shall not be in default of this Agreement if Agency commences to cure said default within ten (10) days of said notice and diligently and in good faith continues to cure the default; 6 .2 .2 Agency makes or delivers to Participant any statement, report, or certificate that is not true or correct in any material respect; or 6.2 .3 Any of Agency' s representations and warranties set forth in Section 5 of this Agreement is untrue or materially misleading. 6. 3 Notice of Default . The non-defaulting party shall give written notice of any default under this Section 6 to the defaulting party, clearly specifying the default. Copies of any notice of default given to the defaulting party shall also be given to any permitted lender requesting such notice. Any failure or delay in giving such notice or in asserting any of either party' s rights and remedies as to any default shall not constitute a waiver of any default, nor shall it change the time of default, nor shall it deprive either party of its rights to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies . 6 .4 Remedies. In addition to any other rights or remedies set forth in this Section 6 .4, either party may institute legal action to cure, correct, or remedy any default, to recover damages for any default, or to obtain any other remedy consistent with the purposes of this Agreement. Such legal actions must be instituted and maintained in the Superior Court of the County of Riverside, State of California, or in, any other appropriate court in that county. Subject to any applicable cure periods and the general right to notice provided for in this Agreement, upon a default or breach FS2\383\0140840006\2155186.2 A11127195 -2 0_ of this Agreement by one party to this Agreement, the other party may bring an action for damages proximately caused thereby or for specific performance of this Agreement or any term or provision hereof. Participant agrees that Agency shall be entitled to the judicial remedy of specific performance and Participant agrees (subject to its reserved right to contest whether in fact a default does exist) not to challenge or contest the appropriateness of such remedy. In this regard, Participant specifically acknowledges that Agency is entering into this Agreement for the purpose of assisting in the redevelopment of the Site and not for the purpose of enabling Participant to speculate with land. 6.5 Agency' s Right to Terminate. In the event that, prior to Participant' s commencement of construction of the Project, Agency is not in default under this Agreement and: (i) Participant commits a default hereunder and fails to cure such default within the time provided in Sections 6.1. 1 and 6.3 ; or (ii) Participant fails to obtain any of the required approvals for the Project referenced herein; then, in such event, Agency may deliver a thirty (30) day written notice of termination to Participant and, if the applicable default or condition has not been satisfied (or waived by Agency) within said time period, this Agreement shall terminate and neither party shall have any further rights against or liabilities to the other (except Agency reserves its rights under Section 6 .4 if Participant is in default) . 6 . 6 Rights and Remedies are Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties hereto are cumulative, and the exercise by any party of one or more of its rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by another party. SECTION 7 . GENERAL PROVISIONS . 7.1 Standards of Review. The Agency' s and Executive Director' s approval (s) under this Agreement shall not be unreasonably withheld. Any disapproval by Agency or Executive Director shall state in writing the reasons for disapproval and the changes which Agency or Executive Director requests to be made. Such reasons and such changes must be consistent with any items previously approved hereunder. Any item submitted to and approved in writing by Agency or Executive Director shall not be subject to subsequent disapproval . An approval by Agency or Executive Director under this Agreement shall not be deemed as a waiver of any requirements that may be imposed by City. 7.2 Governing Law. The laws of the State of California shall govern the interpretation and enforcement of this Agreement. 7.3 Attorney' s Fees . In the event of litigation between the parties arising out of this Agreement, the prevailing party shall FS2\383\0140840006\2155186.2 all/27/95 -21- 0 0 be entitled to recover its reasonable attorneys' fees and other costs and expenses incurred, including attorneys' fees on appeal and all other reasonable costs and expenses for investigation of such action, including the conducting of discovery, in addition to whatever other relief to which it may be entitled. 7.4 Notices . Demands . and Communications Between the Parties . Formal notices, demands, and communications between Agency and Participant shall be sufficiently given if: (i) personally delivered; (ii) delivered by overnight courier (acknowledged by receipt) ; or (iii) dispatched by registered or certified mail, postage prepaid, return receipt requested, to the addresses set forth below: If to Participant: MAC MAGRUDER CHEVROLET/GEO 999 South Palm Canyon Drive Palm Springs, CA 92262 Attn: M. C. Magruder If to Agency: THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS P.O. Box 2743 Palm Springs, CA 92263 3200 East Tahquitz Canyon Way Palm Springs, CA 92262 Attn: Executive Director With a copy to: RUTAN & TUCKER 611 Anton Blvd. , Suite 1400 Costa Mesa, CA 92626 Attn: David J. Aleshire, Esq. All notices shall be deemed to be received as of the earlier of actual receipt by the addressee thereof twenty-four (24) hours after deposit with an overnight courier or the expiration of forty- eight (48) hours after depositing in the United States Postal System in the manner described in this Section. 7.5 Acceptance of Service of Process. In the event that any legal action is commenced by Participant against Agency, service of process on Agency shall be made by personal service upon Executive Director or the Secretary of Agency, or in such other manner as may be provided by law. In the event that any legal action is commenced by Agency against Participant, service of process on Participant shall be made by personal service upon Participant or in such other manner as may be provided by law, and shall be valid whether made within or without the State of California. 7. 6 Conflicts of Interest. No member, official, or employee of Agency shall have any personal interest, direct or indirect, in this Agreement nor shall any such member, official, or employee participate in any decision relating to this Agreement which affects his personal interests or the interests of any corporation, F52\3%3\014084-000612155186.2 all/27/95 -2 2- 0 partnership, or association in which he is, directly or indirectly, interested. 7. 7 Nonliability of Agency Officials and Employees. No member, official, employee, or consultant of Agency or City shall be personally liable to Participant, or any successor in interest of Participant, in the event of any default or breach by Agency or for any amount which may become due to Participant or to its successor, or on any obligations under the terms of this Agreement . 7. 8 Books and Records. 7. 8 . 1 Maintenance of Books and Records . Participant shall prepare and maintain all books, records and reports necessary to substantiate Participant' s compliance with the terms of this Agreement or reasonably required by the Agency. 7. 8 .2 Right to Inspect. Either party shall have the right, upon not less than seventy-two (72) hours notice, at all reasonable times, to inspect the books and records of the other party pertaining to the Site as pertinent to the purposes of this Agreement . Said right of inspection shall not extend to documents privileged under attorney-client or other such privileges . 7.9 Ownership of Documents. Copies of all drawings, specifications, reports, records, documents and other materials prepared by Participant, its employees, agents and subcontractors, in the performance of this Agreement, which documents are in the possession of Participant and are not confidential shall be delivered to Agency upon request in the event of a termination of this Agreement, and Participant shall have no claim for additional compensation as a result of the exercise by Agency of its rights hereunder. The Agency shall have an unrestricted right to use such documents and materials as if it were in all respects the owner of the same. Participant makes no warranty or representation regard- ing the accuracy or sufficiency of such documents for any future use by Agency, and Participant shall have no liability therefor. Notwithstanding the foregoing, the Agency shall not have any right to sell, license, convey or transfer the documents and materials to any third party, or to use the documents and materials for any other site, except in the case of a termination of this Agreement due to default of Participant. 7. 10 Fair Meaning. This Agreement shall be construed according to its fair meaning and as if prepared by each respective party hereto. 7 .11 Titles and Captions . Titles and captions are for convenience only and shall not constitute a portion of this Agreement. 7. 12 Gender. As used in this Agreement, masculine, feminine or neuter gender and the singular or plural number FS2\383\014084-0006\2155186.2 all/27/95 -2 3- 0 • shall each be deemed to include the others wherever and whenever the context so dictates . 7.13 Modifications . Any alteration, change or modification of or to this Agreement, in order to become effective, shall be made by written instrument or endorsement thereon and in each such instance executed on behalf of each party hereto. 7. 14 Mercer of Prior Agreements and Understandings . This Agreement and all documents incorporated herein contain the entire understanding among the parties hereto relating to the transactions contemplated herein and all prior or contemporaneous agreements, understandings, representations, and statements, oral or written, are merged herein and shall be of no further force or effect . 7.15 No Third Parties Benefited. This Agreement shall create no other third party beneficiary rights or any other rights in favor of any persons, firms or corporations. This, Agreement is for the sole use and benefit of the parties hereto and is not for the use or benefit of any other person or entity. 7. 16 Assurances to Act in Good Faith. Agency and Participant agree to, execute all documents and instruments and to take all action, including deposited funds in addition to such funds as may be specifically provided for herein and as may be required for the development of the Site as herein contemplated and shall use their best efforts to accomplish the development of the Site in accordance with the provisions hereof. Agency and Participant shall each diligently and in good faith pursue the satisfaction of any conditions or contingencies subject to their approval . 7. 17 Interpretation. The terms of this Agreement shall be construed in accordance with the meaning of the language used and shall not be construed for or against either party by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply. 7. 18 Effect of Redevelopment Plan Amendment . Pursuant to the provisions of the Redevelopment Plan for modification or amendment thereof, Agency agrees that no further amendment to the Redevelopment Plan which causes the uses or development permitted on the Site, or changes the restrictions or controls that apply to the Site or otherwise affects the Site shall be made or become effective as to the Site without the prior written consent of Participant. Further amendment to the Redevelopment Plan applying to other property in the Redevelopment Project Area shall not require the consent of Participant . 7 . 19 Time For Acceptance of Agreement By Agency. This Agreement, when executed by Participant and delivered to Agency must be authorized, executed and delivered by Agency not later than the time set forth in the Schedule of Performance or this instrument shall be void, except to the extent that Participant shall consent in writing to further extensions of time for the FS2138310160840006M55186.2 .11/27/95 -2 4 authorization, execution and delivery of this Agreement . After execution by Participant, this Agreement shall be considered an irrevocable offer until such time as such offer shall become void due to the failure of the Agency to authorize, execute and deliver this Agreement in accordance with this Section. 7.20 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. 7.21 Severability. Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law. If, however, any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement. 7.22 Extension of Times of Performance. Time is of the essence of the performance of this Agreement. Notwithstanding the foregoing, in addition to the specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in default during an event of Force Majeure. An extension of time for an event of Force Majeure shall be limited to the period of such event, and shall commence to run from the time of the commencement of the cause, provided notice by the party claiming such extension is sent to the other party within ten (10) days of the commencement of the cause. In the event of such delay, the party delayed shall continue to exercise reasonable diligence to minimize the period of delay. Times of performance under this Agreement may also be extended by mutual written agreement by Agency and Participant. The Executive Director shall have the authority on behalf of Agency to approve extensions of time not to exceed a cumulative total of one hundred eighty (180) days. IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective as of the date first written above (the "Effective Date" ) . ATTEST: THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS By. .__ ssistant ecretary - Chairman FS2\8881014084000612155186.2 all/27/95 -2 rj_ APPROVED AS TO FORM: RUTAN & TUCKER By: jDavidQJ-..,�AlesHj-re,-Esq. Agency Counsel "Agencyll MAC MAGRUDER, CLOK Mac Magrud€r Chevrolet/Geo "Participant], FS2\323\014084-0006\2155186.2 .11/27195 -26- EXHIBIT "A" LEGAL DESCRIPTION OF SITE The Easterly 470 feet of the South one-half of the Southeasterly one-quarter of the Southeasterly one-quarter of the Northeasterly one-quarter of Section 22, Township 4 South Range 4 East San Bernardino Base and Meridian, Riverside County, California, excepting the Southerly forty-four feet for street purposes and excepting that portion lying within the State Highway on the East, containing 3 .0 acres, more or less. Page 1 of 1 EXHIBIT "A" TO OWNER PARTICIPATION AGREEMENT F52\383\0140840006\2155186.2 all/27/95 ��� { ^s— �,;. `3:. EAST tw£,,'"b`•�''• }.y..,k rIS r• ''�'��:y=V3Y tE•sSEE r � lE�i'APD dC5Ef3t/�Av46EZ,ALLOTTEEW24 f ti J. 115 -s O •, £� Ca: _ Sec,22 iI.�PT/O�Y OFT.YE .S.�,SEf, 6fy,iYf�� .4'EGT/OiY' : •_ ,, _, ":, 'n_,�:. iirt.J AM- t A.'':_irGrA -IGf�/E�F�L✓1.16 P1 fBi3o 3,v j rrg€s pis EXHIBIT "C" • SCOPE OF DEVELOPMENT CREVROLET IMAGE 2000 for dealership facilities Page 1 of 4 Mac Magruder Chevrolet/GEO Palm Springs, CA W David Sowinski, Facility designer Selected color pallet - "Light gray scheme" RECOMMENDED LEASEHOLD IMPROVEMENTS Exterior : Fascia: See Plastiline specification Walls: Paint C7C "Gigs'" gray, Semi-gloss. Doors: Paint C7C "Gigs'" gay, Semi-gloss. Frames: Paint C71) "Silver Lining" gay, Semi-gloss. Glass: Gray tinted, insulating glazing where required, typical. Showroom : Floor. CLG- 1 "Agata", 12"x 12" / CLG- 2 grout typical, Ceramic tile Base: CLG- 12B black 4" rubber Cove base Walls: Paint C7D "Silver Lining" gray, Semi-gloss. Doors: Paint C7C "Gigs'" gray, Semi-gloss. Paint C71) "Silver Lining" gray, Semi-gloss. Ceiling: Suspended acoustical tile, 2W grid- 111" a$ Lighting: Recessed fluorescent fixtures w/full spectrum(daylight) lamps, with parabolic diffusers . Notes: Provide electrical connections for Light clouds in the feature vehicle display area, as indicated on plans. Patio lighting; these lamps could be replaced with recessed incandescents or possibly suspended up-lights, these would bounce light off the ceiling illuminating the cars more evenly. Minimally the fixtures should be cleaned up and have the ballast's and bulbs replaced as necessary. Closing offices Floor. CLG- 3B Veelock laser "Ash gray", Carpeting with black transition strip. Base: CLG- 12B black 4" rubber Cove base Walls: • CLG - 6A "Espere" vinyl wall covering - cobblestone gray/vertical texture Doors: Paint C7C "Gigs'" gray, Semi-gloss. Trim: Paint C713 "Silver Lining" gray, Semigloss. Ceiling: Paint C7A "Winters gate" Lighting: Recessed fluorescent fixtures.w/full spectrum(daylight) lamps, use parabolic diffusers/reflectors, Notes: EXHIBIT "C" QWNt1PR0UMS HMDRPT.3.-,.%1 Mac Magruder Chevrolet/GEO Page 2 of 4 RECOM1bfENDED LEASEHOLD WROVEMENTS General Maneer's Office : Floor. CLG- 3B carper, "Veelock laser " - ash gray Base: CLG- 12B black 4" rubber Cove base Walls: Paint C71), "Silver lining" gray, Semi-gloss Doors: Paint C7C "Gigs'" gray, Semi-gloss. Trim: Paint C7D, "Silver lining" gray, Semi -gloss Ceiling: Paint C7A, "Winters gate" gray, Semi- gloss Lighting: Install 2x4 fluorescent fixtures with parabolic diffusers. Use "full spectrum" lamps. F&I Office Floor. CLG- 3B carpet, "Veelock laser " - ash gray Base: CLG- 12B black 4" rubber Cove base Walls: Paint C7D, "Silver lining" gray, Semi -gloss Doors: Paint C7C, "Gigs'" gray, Semi-gloss. Trim: Paint C7D,."Silver lining" gray, Semi -gloss Ceiling: Paint C7A, 'Winters gate" gray, Semi - gloss Lighting: Install Zx4 fluorescent fixtures with parabolic diffusers. Use "foil spectrum" lamps. Rest rooms : Floor CLG 9A 2"x 2", "Loan star" gray/CLG-2 grout typical, Ceramic tile Base: CLG-12B "Black" 4" rubber Cove base. Walls: CLG- I IA 2" x 2"white/Natural color grout, Ceramic tile to 4' 6" aff. Paint C7C, "Gigs' gray", Semi Gloss from 4'6" AFF to ceiling. Doors: Paint C7C, "Gigs' gray", Semi-gloss. Trim: Paint C71), "Silver lining" gray, Semi -gloss Ceiling: Paint C7A, 'Winters gate" gray, Semi -gloss Lighting: Install 2x4 fluorescent fixtures with parabolic diffusers. Use "full spectrum" lamps. Customer Lounee : Floor. . CLG- 1 "Agata", 12"x 12" / CLG- 2 grout typical, Ceramic file Walls: CLG- 6B Forum, "October fest gray", Vinyl wall covering, light gray Doors: Paint C7C, "Gigs'" gray, Semi-gloss. Trim: Paint C71), "Silver lining" gray, Semi -gloss Ceiling: Paint C7A, "Winters gate" gray, Semi -gloss Lighting: Install fluorescent fixtures with parabolic diffusers, use full spectrum lamps. Notes: Install Muller/Zell merchandising elements as indicated on plans. aWnrRaoornt LDRrrs..0 Mac Magruder Chevrolet/GEO Page 3 of 4 RECOMMENDED LEASEHOLD I11PROVEMENTS Retail Parts : Floor. CLG- 5A "Empire" rubber- raised radial flooring, gray, 4'behind counter also. Base: CLG- 12A gray 4" rubber Cove base Walls: Paint C7C, "Winters gate" gray, Semi gloss Doors: Paint C7C, "Gigs' gray", Semi-gloss. Trim: Paint C7D, "Silver lining" gray, Semi _gloss Ceiling: Paint C7A, "Winters gate" gray, Semi -gloss Lighting: Recessed fluorescent fixtures with parabolic diffusers. Use Sill spectrum lamps. Service shoos : Paint Buildings to match showroom building (A) Cashier • Floor. CLG- 1 "Agata", 12"x 12" /CLG- 2 grout typical , Ceramic tile Base: CLG- 12A gray 4" rubber cove base Walls: Paint C7D, "Silver lining" gray, Semi Gloss Doors: Paint C7C, "Gigs' gray", Semi-gloss. Trim: Paint C71), "Silver lining" gray, Semi-gloss Ceiling: Paint C7A, "Winters gate"gray, Semi-gloss Lighting: Recessed fluorescent fixtures with parabolic diffusers. Use full spectrum lamps. Business offices Floor CLG- 3B carpet, "Veelock laser " - ash gray Base: CLG- 12B black 4" rubber Cove base Walls: Paint C71), "Silver lining" gray, Semi Gloss Doors: Paint C7C, "Gigs'gray", Semi-gloss. Trim: Paint C71), "Silver lining" gray, Semi-gloss Ceiling: Paint C7A, "Winters gate" gray, Semi - gloss Lighting: Install2'xT fluorescent fixtures with parabolic diffusers. Use "firll spectrum" type lamps. c:M.+urxoUnocslF ELDRrrsAM t Mac Magruder Chevrolet/GEO Page 4 of 4 RECONSIE DED LEASEHOLD IMPROVEMENTS Service Manager Floor. CLG- SA"Empire" rubber-raised radial flooring, gray. Base: CLG- 1ZA gray 4" rubber Cove base Walls: Paint C71), "Silver lining" gray, Semi Gloss Doors: Paint C7C, "Gigs' gray", Semi-gloss. Trim: Paint CM, "Silver lining" gray, Semi-gloss Ceiling: Paint C7A, "Winters gate" gray, Sean -gloss Lighting: Install fluorescent fu=es with parabolic diffusers. Use full spectrum lamps. Service writers - Floor: CLG- 5A "Empire" rubber- raised radial flooring on the top of the islands Base: Walls: Doors: Trim: Ceiling: Lighting: Notes: This area is entirely "outdoors",under a conopy. The colors are to match the building exterior. Second Floor Break Room Floor. CLG-4 Terralast, " Ermine" #402, VCT Base: CLG- 12A gray 4" rubber Cove base Walls: Paint C7C, "Winters gate" gray, Semi gloss Doors: Paint C7C, "Gigs' gray", Semi-gloss. Trim: Paint C71), "Silver lining" gray, Send -gloss Ceiling: Paint C7A, "Wiirrters gate" gray, Semi-gloss Lighting: Recessed fluorescent fixtures with parabolic diffusers. Use full spectrum lamps. Second Floor Conference Room Floor. CLG- 3B carpet, "Veelock laser" - ash gray Base: - CLG- 12B black 4" rubber Cove base Walls: Paint C71), "Silver lining" gray, Semi Gloss Doors: Paint C7C, "Gigs'gray", Semi gloss. Trim: Paint C71), "Silver lining" gray, Seim -gloss Ceiling: Paint C7A, "Mutters gate" gray, Semi-gloss Lighting: Install Zx4 fluorescent fixtures with parabolic diffusers. Use"fitll spectrum" lamps. C=41drtPROMDOCSIFMIM2P'r.SA.�t EXHIBIT "C" SCOPE '1W DEVELOPMENT - PAGE 5 tz .AL.F � 9 .uu"i =a .m -dnvon �nve • -_ieonone --mod L °AUM SPRINGS. JAUFCRNIA 92264 REMODELIVG MENSES Replace Block wall and repair 678 03 Cass Rogers Civil, Engineer 2,105.00 (Drawings for new signs and codes) Edwards & Sons 3 new lifts 10,881.67 Bureau of Indian Affairs 2,000.00 (Administrative cost on new lease) Remodel Banners 434.23 Air Conditioning (Body Shop & Service Manager) 650.42 Palm tree removal 600.00 Freestanding Car Port 3,771.25 Freestanding car port signs 608.78 Survey of Image 2000 3,500.00 Image 2000 Signs 27,503.19 4315.90 4315.90 7250.60 43385.59 Install canopy for new signs 29,209.00 (Paid $11,692.60 on 11/28/95 Sauers Brothers Construction (Inside remodel 150,757.00 Three sliding entry gates 3,935.00 Six outside glass doors 4579.00 Re-Key all door and locks 300.00 All outside replacement lites 35123.33 *Outside lites in front of showroom if approved by owner 10,127.00 Total 302.645.30 "The Best Deal Under the Sun" EXHIBIT "D" LEASE UNITED STATES DEPARTMENT OF THE INTERIOR Bureau of Indian Affairs Lease No. 328 Allotment No. 24C BUSINESS LEASE 1.Parties. THIS LEASE,in seztuplicate,is made and entered into this day of October 1995 by and between Leonard Joseph SaubeL Allottec No.24 hereinafter called the'Landlord',whose address is do Bureau of Indian Affairs P.O.Box 2245 Palm Springs,California 92263- 2245, and MAC MAGRUDER CHEVROLET, a California Corporation, hereinafter called the 'Tenant', whose address is 999 South Palm Canyon Drive, palm Springs, California 92263, with reference to the facts and circumstances set forth hereinafter. This lease entered into pursuant to the provisions of the Act of August 9, 1955, as amended and as subsequently modified,25 U.S.C.415,as implemented by Part 162 Leasing and Permitting - of the Code of Federal Regulations, Title 25 Indians, and any amendments thereto relative to Business Leases on restricted Indian lands which by reference are made a part hereof, If a conflict arises with any subsequent modification of Part 162 and the lease, he modification applies, unless specifically waived by the Secretary. 1. Description. For and in consideration of the rents, covenants, and agreements hereinafter set out, the Landlord hereby leases to the Tenant the ollowing described premises:Allotment of Leonard Joseph Saubel AIloacc No.24, described as follows: The eastedy 470 feet of the South one-half of the Southeasterly one-quarter of the Southeasterly one-quarter of the Northeasterly one-quarter of Section 22,Township 4 South Range 4 Fast San Bernardino Base and Meridian, Riverside County, California, excepting the southerly forty-four feet for street purposes and ezecpting that portion lying within the State Highway an the east, containing 3.0 acres, more or less. �.�s of 19 pages Landlord initials _ _ Tenant initials G _ EXHIBIT "0" TO OWNER PARTICIPATION AGREEMENT FSTJ810140840006\2155186.2 all/27/95 r 3. Definitions. A. "Secretary"means the Secretary of the United States Department of the Interior or his authorized representative, delegate or successor. B. "Gross receipts' means all income, including money and any other thing of value, received by or paid to Tenant or its affiliates,whether individuals, corporations, partnerships or other legal entity, or received by or paid to others for Tenant's or its affiliate's use and benefit, derived from business done, sales made or services rendered directly or indirectly from or on the leased premises, or derived from the subleasing, submnting, permitting, contracting or other use of the leased premises or any portion thereof. All income accruing from credit transactions shall be treated as "gross receipts" as of the date credit is extended "Gross receipts" shall not include amounts collected and paid out for a sales or excise tax imposed by a duly constituted governmental authority where such tax is billed to the purchaser as a separate item.It shall not include credits for the exchange of goods or merchandise between the stores,if any,of Tenant or its affiliates where such exchange is made solely for the convenient operation of business and not for the purpose of consummating a sale previously made directly or indirectly from or on the leased premises. It shall not include the amount of any refund where the merchandise sold,or some part thereof,is returned by the purchaser and accepted by Tenant or its affiliates.It shall not include income from the sale of futures or good will. 'Gross receipts' shall not include proceeds from 'internal sales'. The teen 'internal sales' shall include the following items: used cars wholesaled; labor, internal; warranty claims, labor, new vehicle inspection; body shop labor, internal; body shop warranty; parts, internal; parts, warranty claims; new cars to lease and rental; new trucks to lease and rental; 80% of new can - fleet; 80% of new trucks -fleet; GM insurance plan. 'Internal sales' is defined with reference to General Motors Dealers Standard Financial Statement, a copy of which is to be attached hereto,marked Exhibit"B"and incorporated herein by reference." C. Impositions. "Impositions" shall mean and include all impositions, all amounts, all costs, all expenses and all charges of any and every kind (whether foreseen or unforeseen) which may be or become due or owing with respect to all or any part of the 4 Premises (or any portion thereof or any interest therein) during, for, or with respect to, all or any part of the Term of this Lease, including, without limitation, all real estate, ad valorem; and other taxes or assessments, assessments for public improvements or benefits (whether or not commenced or completed during the term of this Lease), possessory interest taxes, water and sewer charges, gross receipts tax, tax on rents or any other tax described levied against Landlord on account of the rent reserved hereunder,and governmental impositions and charges of every kind and nature whatsoever, extraordinary as well ordinary, and each and every installment thereof, which shall or may during the Tam be charged,levied,assessed, imposed upon or become payable out of,or become liens upon,or arise in connection with the ownership, leasing, operation,use, occupancy or possession of, or become due or payable out of Premises,or any part thereof or any interest therein, or be payable for or with respect to or the premises or the Lease or the privilege of entering into or holding this Lease or leasing, or;easing space within, the Premises, regardless of whether assessed or levied upon or payable by Landlord or Tenant Notwithstanding anything contained in the foregoing to the contrary, "Impositions" shall not include any liens affecting the Premises which secure a mortgage or deed of trust obligation of Landlord 4.Term. The term of this lease shall be 20 years beginning on August 20, 1996,which date shall be the anniversary date of this lease. 5. Renewal. At Tenant's option,Tenant may after 10 and/or 15 years terminate this lease with a minimum of a 90 day written notice. Tenant shall 2 of 19 pages Landlord initials'z�� Tenant initials��` r have art option to renew this Iesse for a Sather period of five yeas by Siving dt moa&s wrh=notice in advaoce to Landlord and Seaaary prior to the expiration dice of this lass provided that if Landlord sh&U receive a boos fide offer to lease the pxsmisca,the Landlord sbz2 read to Tenant it copy of the proposed Iease(except for the name of the Tcaam)and notify the Tenant of the intention of the Landlord to accept the aura The Teaaat shxa bave the right within 20 days to cxctcise the option,m wtitin&provided the:caul tmdcr the renewal period shag be for at last as much sx a spo46ed in the aid proposed Lease. Financial information included in Section 6 has been deemed confidential by the Bureau of Indian Affairs, and has been eliminated from this document. 3 of 19 pages Landlord initials Tenant inilialS�"e;' 7. Liens, Taxes, Utilities. No mechanics's lien, material lien, or any lien for goods, labor, materials, services or work delivered to or performed on the premises shall attach to or encumber Landlord's fee or reversionary interest in the property. AR contractors, subcontractors and providers of goods, labor, materials, services or worn, to or for the benefit of the premises, are: hereby put on notice of this provision and restriction and by such notice they agree that they shall have no such lien on Landlord's interest in the premises. Landlord shall have the right to post on the premises any and all notices of non-responsibility which Landlord in its sole and absolute discretion deems appropriate. The filing of any lien against Landlord's interest in the premises in violation of this provision shall not be deemed to be a default of Tenant under this lease, if Tenant diligently and in good faith, discharges or contests the lien. Tenant shall cause each person with whom it contracts for the construction of improvements on or for the benefit of the premises to agree, in such contract, to the prohibition against liens against the Landlord's fee interest in the land and shall require such contractors to cause their subcontractors to do the same. Tenant shall not permit to be enforced against the leased premises or any part thereof, any liens arising from any wodc performed, materials furnished or obligations incurred by Tenant. Tenant shall discharge all such urns before any action is brought to enforce same; Rather,Tenant shall pay,when and as the same become due and payable, all taxes, assessments,licenses, fees and other like charges levied luring the term of this lease upon or against the leased land and all interests therein and property thereon for which either the Tenant or Landlord may become liablo.Tenant shall directly bear, pay and discharge all impositions including the payment of taxes before the fast day rn which a penalty or interest may accrue or be assessed thereon for nonpayment. Upon written application, the Tenant shall fianish to the secretary written evidence duly certified that any and all taxes required to be paid by Tenant have been paid, satisfied or otherwise discharged. Penant shall have the right to contest any claim, asserted tax or assessment against the property by posting bond to prevent enforcement of ny lien resulting therefrom,and Tenant agrees to protect and hold harmless the Landlord,the Secretary and the leased premises and all interest herein and improvements thereon from any and all claims, taxes, assessments and like charges and any lien thereto or sale or other roccedings to enforce payment thereof, and all costs in connection therewith.Landlord shall execute and file any appropriate documents with eference to real estate tax exemption of the land when requested by Tenant. In addition to the rents, taxes and other charges herein dcsc ibcd, 4 of 19 pages Landlord initials Zi � — Tenant initials`_ �v Tenant shall pay all charges for water, sewage, gas, electricity, telephone and other utility services supplied to said premises as they become due. Nothing in this lease shall require the Tenant to pay any franchise, estate, inheritance, succession, capital levy or transfer tax of the Landlord,or any income,excess profits tax,or any other tax assessment,charge or levy upon the rent payable by Tenant under this lease. During the term of this lease, tenant shall not permit to remain, and shall promptly discharge, at its sole cost and expense, all liens • and charges (other than liens and charges created by Landlord) upon the premises or any part thereof; provided that the existence of any mechanics' liens, laborers' liens, materialmen's liens, suppliers' liens or vendors' liens or rights thereto shall not constitute a violation of this section if payment is not yet due under the contract and the contract does not postpone payment for more than sixty days after performance, and there is no risk of foreclosure on the lien prior to payment_ Tenant shall have the right to contest with due diligence the validity or amount of any lien or claimed lien, if tenant posts in the manner requited by applicable local law, a bond to remove the lien or, Alternatively,gives to Landlord such security as Landlord may reasonable require to insure payment thereof and to prevent any sale, foreclosure or forfeiture of the Premises or any portion thereof or any interest therein,by reason of such non-payment. On final determination of the lien or claim for lien (including the settlement or compromise of the claim by Landlord as provided below), Tenant shall immediately pay any judgment rendered,with all proper costs and charges and shall have the lien released or judgement satisfied at its own expense. If tenant fails to do so, Landlord may pay, at its option, any such final judgment and clear the Premises from such lien, and any such amount shall become immediately due and payable to Landlord by Tenant with interest at the Prime Rate plus three points. If Tenant fails to contest with due diligence the validity or amount of any such lien or claim for lien,or to post the bond or give Landlord security as required under this Section, Landlord may, but shall not be required to, give the Tenant notice of such failure and if Tenant has not cured same within fifteen (15) days, Landlord may contest the validity or amount of any such lien or claim for lien or settle or compromise the same. If any lien is filed against the Premises or if any action of any character affecting the title hereto is commenced,Tenant shall give to the Landlord written notice hereof promptly following Tenant's receipt of notice of such lien or action. 8. Force Majeure. If any party is rendered unable, wholly or in part, by force majeure to carry out its obligations under this Lease, other than the obligation to indemnify or make money payments or firmish or provide the necessary bond, that party shall give to the other party prompt written notice of the force majeure with reasonably full particulars concerning it;thereupon,the obligations of the party giving the notice, so far as they are affected by the force majcuro, shall be suspended during, but no longer than, the continuance of the force majeure. The term 'force majeure; as here employed, shall mean an act of God, strike, lockout, or other industrial disturbance, act of the public enemy, war, blockade, public riot, lightning, fire, storm, flood or other ad of nature, explosion,restraint or inaction, and any other cause,whether of the kind specifically enumerated above or otherwise, which is not reasonably within the control of the party claiming suspension. The affected party shall use all reasonable diligence to remove the force majeure situation as quickly as practicable. 9.Purpose of the Lease. Tenant shall use the leased premises for the following specific purposes: A new and used automobile lot and repair of said new and used automobiles. Said operations may include,in addition to the sale and leasing of automobiles and trucks,the sale of all other supplies and equipment generally and commonly sold,and services rendered,in such an operation. Tenant shall not leave said premises unoccupied or vacant but shall continuously during the entire term of the lease herein conduct and 5 of 19 pages Landlord initials ` .J Tenant initials'A6-7� carry on in the demised premises the type of business for which the demised premises are leased,keep in stock in the demised premises a full and ample supply of merchandise for the purpose of carrying on said business,and to maintain an adequate staff of personnel to serve properly all customcs and to operate said business in an efficient and diligent manner. Tenant agrees that he shall use this location with these improvements as his primary place of business in the City.of Palm Spring and that if Tenant shall conduct business elsewhere in the City of • Palm Springs,new car sales shall not be made elsewhere than on the leased premises. If the Tenant uses the leased premises for any purpose not set forth above without the prior consent and written approval of the Landlord,and the Secretary,such use shall constitute grounds for cancellation of the lease. Tenant shall use and keep the premises, and all improvements located thereon in full compliance with all applicable laws,regardless of whether any such applicable law expressly allocates the burden of such compliance to Landlord or to another party. Tenant shall not use or permit any person or persons to use the premises or any part thereof for any use or purpose in violation of the laws of the United States of America,the Agua Caliente Band of Cahuilla Indians, or applicable laws, ordinances,regulations and the requirements of the state, county or city where the property is situated or of any other applicable governmental authorities, and Tenant shall keep the premises and every part thereof in a clean and wholesome condition, fee from any nuisances and shall comply with any and all applicable health and police regulations in all material respects. 10. Operating Covenant From and after the date the premises open for business, Tenant shall be obligated to continually operate the business throughout the term of this lease. Tenant shall conduct such business on the premises at all times in a respectable, reputable and lawful manner and in accordance with standards of similar businesses conducted in the Coachella Valley. t 11. Improvements. All improvements, excluding removable personal property and trade futures, on the leased property shall remain on said property after the termination of this lease; also, any future buildings shall become the property of the Landlord The term 'removable personal property'as used in this Clause shall not include property which normally would be attached or affixed to the buildings,improvements or land in such a way that it would become a part of the realty,regardless of whether such property is in fact so placed in or on,or affixed or attached to, the buildings, improvements or land in such a way as to legally retain the characteristics of personal property. 12. Delivery of Premises. The Tenant hereby agrees that at the termination of this lease,by normal expiration or otherwise,Tenant will peaceably and without legal process, deliver up the possession of the premises herein described and buildings and improvements,exclusive of the personal property which remains the Tenant's property,in good condition,usual wear and acts of God excepted. 13. Holding over. Holding over by the Tenant after the completion of the term of this lease shall not constitute a renewal or extension thereof or give the Tenant any right hereunder or in or to the leased premises. Tenant agrees to remove all property removable under the terms of this lease within 30 days of the completion of the term of this lease or pay a daily rental computed at the rate of double the daily `rental charged during the year immediately preceding tcrminalion of this 6 of 19 pages Landlord initials �• '` Tenant initials'" l lease from the day following the termination date of the lease until said property is removed. On the 31st day after the completion of the term of this lease,Landlord has the right to enter the premise and take possession of any personal property of the Tenant or occupant which shall remain in the building. Said personal property shall be deemed to have been abandoned by the Tenant and either may be retained by the Landlord as its property or may be disposed of in such manner as the Landlord may see fit If such personal property or any pad thereof shall. • be sold,the Landlord may receive and retain the proceeds of such sale and apply the same, at its option,against the expenses of the sale, the cost of moving and storage,any arrears of rent or additional tent payable hereunder and any damages to which the Landlord may be entitled hereof or pursuant to law. 14.Unlawful Use. The Tenant agrees not to use or cause to be used any part of the leased premises for any unlawful conduct or purpose. 15. Maintenance, Alteration and Repairs. The Tenant shall have the right at any time during the term of this lease to make limited alterations or additions and any repair to any improvement on or placed upon the premises; no single alteration, addition or remodeling of improvements involving an expenditure in excess of$5,000 and , or removal or demolition of improvements, shall take place without the prior written consent of the Landlord and the Secretary.The Tenant shall, at all times during the term of this lease and at the Tenant's sole cost and expense, maintain the premises and all improvements thereon in good order and repair and in a neat, sanitary and attractive condition.Tenant shall construct, maintain and repair,as required by law, all improvements on the leased premises and any alterations, additions or appurtenances thereto, and shall otherwise comply with all public laws, ordinances and regulations applicable to said premises.Tenant shall indemnify and hold hamiless the Landlord and the United States Government against liability for all claims arising from Tenant's failure to maintain said premises and the improvements s thereon, as hereinabove provided, or from Tenant's nonobservance of any law, ordinance or regulation applicable hereto. In addition, at Tenant's expense, to the foregoing, all parties to this contract understand Tenant intends to remodel,modernize and upgrade these premises to Chevrolet's new"Image 2000 Program as well as complete required repairs and replacements related thereto. 16. Indemnification. Neither the Landlord nor the United States Government, nor their officers, agents, and employees shall be liable for any loss, damage, or injury of any kind whatsoever to the person or property of the Tenant or any other person whomsoever caused by any use of the leased premises, or by any defect in any structure erected thereon, or arising from any accident,fire,or other casualty on said premises or from any other cause whatsoever, and Tenant, as a material part of the consideration for this lease, hereby waives on Tcnanfs behalf all claims against Landlord and/or the United States Government and agrees to hold Landlord and/or the United States Government free and harmless from liability for all claims for any loss, damage, or injury arising from the use of the premises by Tenant, together with all costs and expenses in connection therewith. 17.Fire and Damage Insurance. Tenant shall, from the date of approval of this lease, carry fire insurance with extended coverage endorsements, and vandalism, jointly in the names of Landlord and the Bureau of Indian Affairs,covering the full insurable value of the building and all improvements on the leased premises. Certificates of insurance related to said policy or policies shall be deposited with the Secretary, and Tenant shall pay all 7 of 19 pages Landlord initials �•�� Tenant initialsg,C% 2 premiums and other charges payable in respect to such insurance, and shall deposit with the Secretary the receipt for each premium or other charge as paid, or satisfactory evidence thereof. In the event of damage to the building and any improvement on the leased premises, the Tenant shall reconstruct the improvement in compliance with applicable laws and building regulations and in accordance with plans to be approved by Landlord and/or authorized represenative of the Bureau of Indian Affairs. Such reconstruction shall commence within one year after the damage occurs and shall be pursued diligently. Insurance proceeds shall be deposited in escrow with an institution approved by the Sccretary. The Tenant shall also deposit in said escrow all additional funds required to reconstruct the damaged improvemenL Escrow instructions shall include provisions that all funds so deposited shall be used to reconstruct the damaged improvement, and funds shall be disbursed during the progress of reconstruction on proper architect's,engineei s or contractor's certificate. If Tenant has not defaulted under this lease,all money in escrow after reconstruction has been completed shall be paid to Tenant; if a default has taken place,said money shall remain in escrow as security for performance of Tenant until said default is corrected,after which funds remaining shall be paid to TenanL If Tenant does not correct the default,said funds shall be paid to Landlord. 18. Public Liability Insurance. At all tunes during the term of this lease, Tenant shall carry a public liability insurance policy in the minimum amount of SI,OD0,000/S2,000,000 for personal injury, and S1,000,000 for property damage, said policy to be written jointly to protect Tenant, Landlord and the Bureau of Indian Affairs. Current certificate of insurance or copy of said policy and all renewals shall be furnished to the Secretary.Neither the Landlord nor the United States Govemment, nor their officers,agents and employees shall be liable for any loss, damage or injury of any kind whatsoever to the person or property of the Tenant or Subtenant or of any other person whomsoever, caused by any use of the leased premises or by any defect in any structure erected thereon or arising from any accident,fire or other casualty on said premises or from any other cause whatsoever, and Tenant, as a material part of the consideration for this lease, waives on Tenant's behalf all claims against Landlord and/or the United States Government and agrees to hold Landlord and/or the United States Government free and harmless from liability for all claims for any loss, damage or injury arising from the use of the premises by Tenant, together with all costs and expenses in connection therewith. 19. Surety. After approval and prior to delivery of this lease by the Secretary, the Tenant agrees to post a surety in a sum of not less than the second years minimum rent, which surety shall be deposited with the Secretary and shall remain in force for the full term of the lease, at the discretion of the Secretary. The amount of said surety shall be subject to adjustment during the term of the lease to a sum equal to the next year's minimum rent, and Tenant hereby agrees to effect said adjustment before the end of each current lease year. Tenant may funish a corporate surety or,in lieu of corporate surety,Tenant may deposit with the Secretary lawful money of the United States of America a certificate of deposit from a federally chartered lender or negotiable United States Treasury Bonds or other negotiable Treasury obligations in the appropriate amount, together with power of attorney, appointing and empowering the Secretary, in the event of Tenant's default in any of the rent provisions of this lease, to pay over any such cash, or to dispose of any such bonds and pay over the proceeds derived therefrom, as liquidated damages to or for the benefit of the Landlord, subject to Tenant's privilege of curing said default as hereinafter provided. Any other type of security which may be offered by Tenant to satisfy the requirements of this Clause will be given reasonable consideration by the Secretary, but it is understood and agreed by the parties hereto that acceptance of surety in lieu of those described above shall be at the sole discretion of the Secretary. 8 of 19 pages Landlord initials ` ,V,J Tenant initials"'°�P�/� • It is understood and agreed that surety required by this provision will guarantee payment of tent only,and that corporate surety may be furnished annually or may be continued from year to year by a certificate of renewal, copy of which certificate shall be furnished the Secretary by Tenant.If United States Treasury Bonds are provided,Tenant agrees to brake up any deficiency in the value deposited that might occur due to a decrease in the value of the bonds.Interest on said bonds shall be paid to Tenant Notwithstanding the foregoing,landlord and the Director of the Palm Springs Feld Office of the Bureau of Indian Affairs shall attempt to secure a waiver of this surety provision from the central office of the Bureau of Indian Affairs in Washington,DC. 20. Companies Bonding and Insuring. All corporate surety bonds provided by Tenant in compliance with this lease shall be frmished and maintained by companies holding certificates of authority from the Secretary of the Treasury as acceptable sureties on Federal Bonds. Insurance policies shall be famished by such responsible companies as are rated A or better in the current edition of Best's Insurance Guide. 21. Sublease, Assignment,Transfer. The Tenant shall not sublease,assign or transfer this ]case or any right to or interest in this lease or any of the improvements on the leased premises without written consent of the Landlord. The occurrence or existence of any one of the above will constitute an event of default 22.Leasehold Encumbrance. Tenant shall not encumber this lease. s 23. Landlord Paying Claims. Landlord shall have the option to pay any lien or charge payable by Tenant under this lease,or settle any action thereto,if the Tenant after written notice from Landlord or Secretary fails to pay or to post bond against enforcement. All costs and other expenses incurred by Landlord in so doing shall be paid to Landlord by Tenant upon demand with interest at the rate of prime plus 10% per annum, from date of payment until repaid. Default in such repayment shall constitute a breach of the Covenant of this ]ease, 24.Inspection of the Premises. The Secretary and the Landlord and their authorized representatives shall have the right, at any reasonable times during the term of this lease, to enter upon the leased premises, or any part thereof, to inspect the same and all buildings and other improvements erected and placed thereon. 25. Default. Time is declared to be of the essence of this lease. Should Tenant fail to perform pursuant to this lease, and if such default is for non payment of rent, Secretary may proceed with cancellation of this lease pursuant to 25 CFR 162. Should Tenant breach any other covenant of this lease,and if such breach shall continue uncured for a period of 10 days after written notice thereof by the Secretary to the Tenant, during which 10-day period Tenant shall have the privilege of curing such broach,then Landlord and the Secretary may either. A.Collect,by suit or otherwise,all monies as they become due hereunder,or enforce,by suit or otherwise,Tenant's compliance with 9 of 19 pages Landlord initials J/_ Tenant initialstL%rL l any other provision of this lease;or _ B.Terminate this lease. Exercise of this remedy shall exclude recourse to any other remedy. Within 10 days after receipt of written notice under this paragraph,Tenant can request in writing,an extension of time,not to exceed 30 days in which to cure default Any adjudication rendered against Tenant as a debtor under any insolvency or bankruptcy act shall constitute a breach of this lease. No waiver of a breach of any of the covenants of this lease shall be construed to be a waiver of any succeeding breach of the same or any other covenant s C. In the event of an appeal of default by the Tenant,said Tenant will continue to pay rent to Landlord If the appeal involves rents to the Landlord, the Tenant shall continue to pay the minimum rent and the remainder will be placed in the BIXs escrow account until the matter is resolved through a final non-appellate opinion by the courts. 26. Attorneys' Fees. If action is brought by either party in unlawful detainer for rent or any other sums of money due under this lease, or to enforce performance of any of the covenants and conditions of this lease,the losing party shall pay reasonable attorneys' fees of the prevailing party to be fixed by the Court as a part of the costs in any such action. 27. Tenant's Obligations. While the leased premises are in trust or restricted status, all of the Tenant's obligations under this lease, and the obligations of his sureties,are to the United States as well as to the owner of the land. s 28. Payments and Notices. All notices,payments and demands shall be sent to the parties hereto at the addresses herein recited or to such addresses as the parties may hereafter designate in writing. Notices and demands shall be sent by certified mail. Service of any notice or demand shall be deemed complete 10 days after mailing or on the date actually received,whichever occurs first.Copies of all notices and demands shall be sent to the Secretary in care of the Office of the Bureau of Indian Affairs bereinabove recited 29. Eminent Domain. If,at any time during the tern of this lease,the leased premises or any part thereof is taken or condemned under the laws of Eminent Domain, then and in every such case the leasehold estate and interest of the Tenant in such premises or part thereof taken shall forthwith cease and terminate. All compensation awarded by reason of the taking of leased land and any taking of or injury to the buildings or improvements located thereon shall be awarded solely to the Landlord. 30. Lease Binding. This lease and the covenants, conditions and restriction hereof shall extend to and be binding upon the successors, heirs, assigns, executors and administmtors of the parties hereto. 1 0 of 19 pages Landlord initials Tenant initials"_ %�— 31. Interest of Member of Congress. No Member of,or Delegate to,Congress shall be admitted to any share or part of this lease or to any benefit that may arise herefrom, but this provision shall not be construed to extend to this lease if made with a corporation or company for its general benefit 32. Validity. This lease, and any modification of or amendment to this lease, shall not be valid or binding upon either party hereto until approved by the Secretary. 33. Landlord's Determinations, Consents or Approvals. Whenever in this lease it is provided that the Landlord may exercise any rights or discretions or make any determinations, consents or approvals,except changes in guaranteed minimum rentals, percentage rentals,participation of the parties in rentals,term or surrender of the lease, and the leased land is in multiple ownership, the action of those Lessors holding the majority of interest in the ownership of the leased premises shall constitute the action of all the Lessors for the purposes of this lease and any extension thereof. 34.Termination of Federal Trust. Nothing contained in this lease shall operate to delay or prevent a termination of Federal trust responsibilities with respect to the land by issuance of a fee patent or otherwise during the term of the lease.However, such termination shall not serve to abrogate the lease.The owners of the land and the Tenant and his surety or sureties shall be notified of any such change in the status of the land. 35. Agreements for Utility Facilities. Tenant shall have the right to enter into agreements with public utility companies and the State of California or any of its political subdivisions to provide utility services, including, but not limited to gas, water, electricity, telephone, television, and sewer facilities, necessary to the full enjoyment of the leased premises and the development thereof in accordance with the provisions of this lease, which agreement shall be binding upon any subtenant or other occupant of the leased premises; provided, that no such agreement shall cover land not included in this lease. However,any such agreement with such public utility is only for the term of the lease. Upon entering into such agreement or agreements,the Tenant shall furnish the Secretary executed copies thereof together with a plat or diagram showing the true location of the utility lines to be constructed in accordance therewith. No subtenant shall have the right to enter into such facility agreements; this limitation shall be inserted in all subleases. Subtenants;Subtenants;shall, however, have the right to contract for utility services. 36.Tax Immunity. Nothing contained in this lease shall be deemed to constitute a waiver of applicable laws providing tax immunity to trust or restricted Indian property or any interest thereon. 37. General Provisions A.No Mercer.There shall be no merger of this Lease,nor of the Leasehold Estate created by this Lease,with the fee estate in the Land or with the interest or estate of any Leasehold Mortgagee by reason of the fact that this Lease or any such Leasehold Estate may be held, directly or indirectly, by or for the account of any person or persons who shall own a beneficial interest in the Land, or shall hold any 1 1 of 19 pages Landlord initials ` •v Tenant initials"`eo'�- r Leasehold Mortgage.No such merger shall occur unless and until all persons at the time holding the estates or interests to be merged shall join in a written instrument effecting such merger and shall duly record the same. B.Entire Agreement This Lease sets forth all of the agreements,conditions and understandings between Landlord and Tenant relative to the leasing of the Premises, and there arc no promises, agreements, conditions, understanding,warranties or representations, oral or written, expressed or implied,between them other than as set forth or as referred to herein. ' C. No Oral Modification. No statement, action or agreement hereafter made shall be effective to change, amend, waive, modify, discharge, terminate or effect an abandonment of this Lease in whole or in part unless such agreement is in writing and signed by the party against whom such change,amendment,waiver, modification, discharge,termination of abandonment is sought to be enforced D.Successors and Assigns.The covenants and agreements herein contained shall be binding upon and inure to the benefit of Landlord and Tenant and their respective heirs, successors,permitted assigns, and personal representatives. E.Headings.The Table of Contents and Clause headings are inserted herein only for convenience and are in no way to be construed as part of this Lease,or as indicative of the meaning of the provisions of this Lease or the intention of the parties, or as a limitation in the scope of the particular Clauses to which they refer. F. Severability;Invalidity of Particular Provisions.If any term or provision of this Lease, or the application thereof to any person or circumstances shall, to any extent,be invalid or unenforceable, the remainder of this Lease, or the application of such term or provision to persons or circumstances other than those to which it is held invalid or unenforceable, shall not be affected thereby, and each other term and provision of this Lease shall be valid and enforceable to the fullest extent permitted by law. G. No Partnership or Joint Venture. Nothing in this Lease shall be deemed to create a partnership or joint venture between Landlord and Tenant or to render either party generally liable for the debts or obligations of the other. H.Time of the Essence. Except as otherwise specifically provided in this Lease, time is of the essence in this Lease and in each and every provision hereof on Landlords and Tenant's pad to be performed - 1.Exhibits.All exhibits attached hereto and/or referred to in this Lease arc incorporated in this Lease as though set forth in full. J.Governing Law.This Lease shall be governed exclusively by the provisions hereof and by the laws of the United States and to the extent applicable, California Law. K.Counterparts.This Lease may be executed in several counterparts,each of which shall be deemed an original,and such counterparts shall constitute but one and the same instrument L. Landlord's Rights to Defend Notwithstanding anything to the contrary in this Lease, Landlord shall have the right to undertake and continue to defend,at Tenant's reasonable costs and expense,any claim,action or proceeding which is brought against Landlord and which Tenant is obligated under this Lease to defend,if following 10 days notice to Tenant,Tenant has failed to diligently defend M. Quid Enjoyment. Landlord covenants and agrees that upon Tenant's paying the rent reserved herein and timely performing and observing all of the covenants and provisions of this Lease on Tenant's part to be performed and observed,Tenant shall peaceably and quietly enjoy the Premises without disturbance by Landlord or anyone claiming by, through or under Landlord(subject to the terms and conditions of this Lease,encumbrances and Legal Requirements). N. No Third Party Beneficiary.The covenants and obligations set forth in this Lease are to benefit only the parties hereto, and the Leasehold Mortgagee as specified in this Lease, and shall not be for the benefit of any third party. 1 2 of 19 pages Landlord initials kj]�— Tenant initials' �' l 38.Sale of premises by Landlord If Landlord sells, exchanges or assigns this Lease, Landlord shall be and is hereby entirely free and relieved of all liability under this Lease and under any and all covenants and obligations contained in or derived fium this Lease which accrue after the notice to Tenant that such sale, exchange or assignment has been consummated 39. Indian Employment Tenant hereby agrees that to the extent feasible preference and opportunities for training and employment shall be given to enrolled members of Federally recognized tribes. Employer is aware under specific criteria employers on reservations receive a 20% tax credit against tax liablrlities for the first S20,000 of qualified wages and health benefits paid to Indian employees and/or their lawful spouses. The new employee must live on or near the reservation and wages may not exceed$30,000 annually. The tax credit applies to current employees for the amount of wages and benefits above:costs in 1993. Tenant shall have the right to reject the applications for valid reasons,or to terminate the employment of any Indian or their lawful spouse on reasonable grounds. 40. Hazardous Materials. Tenant shall keep and maintain the Premises in compliance with,and shall not cause or permit the Premises to be in violation of any federal, state or local laws, ordinances or regulations relating to industrial hygiene or to the environmental conditions on,under or about the Premises including but not limited to, soil and groundwater conditions. Tenant shall not use generate, manufacture, store or dispose of on, under or about the Premises or transport to or from the Premises any flammable explosives, radioactive materials, hazardous wastes, toxic substances or related materials, including, without limitation, any substances defined as or included in the definition of "hazardous substances; 'hazardous wastes," "hazardous materials; or "toxic substances under any applicable federal or state laws or regulations (collectively referred to hereinafter as"Hazardous Materials"). A. Notification. The parties shall immediately advise each other in writing as soon as they become aware of (i) any and all enforcement, cleanup, removal or other governmental or regulatory actions instituted, completed or threatened pursuant to any applicable federal, state or local laws, ordinances, or regulations relating to any Hazardous Materials affecting the premises ("Hazardous Materials Laws');(ii) any and all claims made or threatened by third parties claiming or regulating damage, contribution, cost recovery compensation, loss or injury as a result of Hazardous Materials on or emanating from the Premises (the matters set forth in clauses (i) and (iD above are hereinafter referred to as "Hazardous Materials Claims"); and (iii) all occurrences or conditions on any real property adjoining or in the vicinity of the Premises that could cause the Premises or any part thereof to be classified as "bordercone property" under the provisions of California Health and Safety Code, Sections 25220 et seq.. or any regulation adopted in accordance therewith, or to be otherwise subject to any restrictions on the ownership,occupancy,transferability or use of the Subleased Premises under any Hazardous Materials Laws. Tenant hereby agrees to pay for all expenses pertaining to replacing underground fuel tanks and waste oil tanks in accordance with applicable laws and pay for all expenses in converting to above ground tanks. B. Indemnity. Landlord shall have the right to join and participate in, as a party if it so elects, any legal proceedings or actions initiated in coancction with any Hazardous Materials Claims regardless of whether Landlord is legally liable or responsible therefor, and, if Tenant is liable or responsible therefor pursuant to this paragraph, Landlord's reasonable attorneys' fees in connection therewith shall be paid by Tenant. Tenant shall be solely responsible for, and shall indemnify and hold harmless Landlord, its directors, officers, employees, 1 3 of 19 pages Landlord initials J Tenant initialsdl'- G � agents, successors and assigns from and against, any loss, damage, cost, expense or liability directly or indirectly arising out of or attributable to the use, generation, storage, release, threatened release, discharge, disposal, or presence of Hazardous Materials on, under or about the premise during the term of the Sublease, including, without limitation: (a) all foreseeable consequential damages; (b) the costs of any required or necessary repair,cleanup or detoxification of the Premises,and the preparation and implementation of any closure,remedial or other required plans; and(c)all reasonable costs and expenses incurred by Landlord in connection with clauses (a)and(b), including but not limited to reasonable attorneys' fees.The various rights and remedies reserved to Landlord herein, including those not specifically described herein, shall be cumulative, and, except as otherwise provided by Cali min law in force and effect at the time of the execution hereof, Landlord may pursue any or all of such rights and remedies,whether at the same time or otherwise. y The foregoing indemnity shall;further apply to any- residual contamination on or under the Premises, or affecting any natural resources, and to any contamination of any property or natural resources arising in connection with the generation, use, handling, storage, transport or disposal of any such Hazardous Materials, and irrespective of whether any of such activities were or will be undertaken in accordance with applicable laws, regulations,codes and ordinances. C. Remediation. without Landlord's prior written consent, which shall not be unreasonably withheld, Tenant shall not take any remedial action in response to the presence of any Hazardous Materials on, under, or about the Premises, nor enter into any settlement agreement, consent decree, or other compromise in respect to any Hazardous Material Claims,which remedial action, settlement,consent or compromise might, in Landlord's reasonable judgment impair the value of Landlord's interest hereunder, provided, however, that Landlord's prior consent shall not be necessary in the event that the presence of Hazardous Materials on, under, or about the Premises ether poses an immediate threat to the health,safety or welfare of any individual or is of such a nature that an immediate remedial response is necessary and it is not possible to obtain Landlord's consent before taking such action, provided that in such event Tenant shall notify Landlord as.soon as practicable of any action so taken. Landlord agrees not to withhold its consent, where such consent is required hereunder, if either (i) a particular tcmcckal action is ordered by a court of competent jurisdiction, or(ii)Tenant establishes to the reasonable satisfaction of Landlord that there is no reasonable alternative to such remedial action which would result in less impairment of Landlord's security hereunder. D.Landlord's Covenants and Obligations.Landlord shall not cause, nor permit its agents,employees, or contractors to bring upon, keep, or use on or about the Premises, any Hazardous Materials except in a manna that complies with all laws,ordinances, and regulations regulating any such Hazardous Material so brought upon,kept or used in or about the Premises. If Landlord breaches the obligations stated in the preceding sentence and contamination of the Premises occurs and results thereby, or if contamination of the Premises by Hazardous Material otherwise occurs for which Landlord is legally liable, then Landlord shall (i) promptly take all actions, at its expense, as may be necessary to return the Premises to substantially the same condition existing prior to the introduction of any such Hazardous Material, and (ii) indemnify, defend, and hold Tenant harmless from any and all claims, judgments, damages, penalties, fines, costs, liabilities, or loss" which arise as a result of such contamination. 1 4 of 19 pages Landlord inftials ^_J_Y Tenant initials� i • IN WITNESS WHEREOF,the parties hereto have duly executed this tease as of the day and year fast above written. DATED /` LEONAI&JOSEPHSALIBEL,LANDLORD State of California ) ss County of Riverside/ ) On 3 7 f/ b/eforo me, t \ 4 !til D A)A �• � f I rS a notary public, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the persoif,f whose name(/is/aWsubscribed to the within instrument and acknowledged to me that hd ey executed the same in hisA1 d authorized capacity( and that by his/ to r si�rature on the instrument the person or the entity upon behalf of which the personJ,djacted, executed the ent. (O RAMONA L. ELLIS WITNESS my hand and official scat N COMM.11041911 C NOTARY PUBLIC-CALIFORNIA N RIVERSIDE COUNTY M Comm.E Ires October 9 1998 Notarial Seal Notary Public 1 5 of 19 pages Landlord initials 2. Tenant initials�� � _ i • DATED: MAC MAGRUDER CHEVROLET, Inc., A California Corporation, TENANT by: (title of authorized official) State of California ) ss County of Riverside ) On L.Liv before me M 0 A) `" 1 �s a notary public, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the perso%411' whose name/is/Ye subscribed to the within instrument and acknowledged to me that hel/e/yy executed the same in his /1 rr authorized capacity and that by his�t� rr signature on the instrument the person or the entity upon behalf of whicb the person(s)" acted, executed the instrument. RAMONA L. EL ISe.nj WITNESS my hand and official seal. - COMM./1041911 c NOTARY PUBLIC-CALIFORNIA N RIVERSIDE COUNTY IX Comm.5 Ires October 9 1998 Notarial Seal Notary Public 1 6 of 19 pages Landlord inRials Tenant initials G`��_�? Affidavit of Tenant. STATE OF CALIFORNIA ) as COUNTY OFRWERSIDE ) ' ,,� I, aI` , LI oar uj t— __ (insert name of authorized official), the hey/ter x (insert title of authorized official) of Mae Magruder Chevrolet Inc,A California Corporation,TENANT heroin, being duly sworn, depose and say that TENANT is leasing the land herein for own use and benefit and not directly or indirectly for the benefit of any other person partnership, corporation or any other entity. DATED: A �7 �l•1 ' �' ✓' ��� MAC MAGRUDER CHEVROLET,Inc,A California Corpomtion,TENANT by:(title of authorized official) State of California ) as County of Riverside ) '/�.�/ 9 �^ On before me, A �-LM C�IC��' L—• ^L� r S a notary public, personally appeared mm (Amonally ]mown to me (or proved to me on the basis of satisfactory evidence) to be the perso/ e(whose nam ,wf is/� subscribed to the within instrument and acknowledged to me that hl;Afi cy executed the same in his h authorized capacity), and that by hisKI rr signature on the ent the personKor the entity upon behalf of which the person/acted, executed the cut. RAMONA L. ELLISins COMM./1041911 NOTARY PUBLIC-CALIFORNIA w1Ai. WITNESS my hand and official seal. RNERSIDE=O r' M Comrn. X iresOctoher9199B Notarial Seal Notary Public - 1 7 of 19 pages Landlord initials Zia Tenant initialOe Affidavit of LANDLORD. STATEOFCALIFORNIA ) ss COUNTYOFRIVERSIDE ) I,the undersigned, LEONARD JOSEPH SAUBEL, LANDLORD of the within lease,hereby certify that the contents,purport,and effect of the within lease are fully understood by me and that I signed the lease of my own free will Signature of LANDLORD State of California ) ss County of RiversideG / ) On / ` J before me, 41.49-�A- �'"" 2�rs a notary public, personally appeared SQI'L 6-eI sr / personally kn""""o�/l�wn to me (or proved to me on the basis of satisfactory evidence) to be the perso(((n(9 ti whose nam(is/�re subscribed to the within instrument and acknowledged to me that he's ,,, ,y executed the same in authorized capacity(and that by his/h�II' signature on the instrument the person( or the entity upon behalf of which the perso(ac[ed, executed the ent. RAMONA COMM.J1 04 1 ELLIS WITNESS my hand and official seal � 911 � NOTARY PUBLIC-CALIFORNIA mW RIVERSIDE COUNTY N M Comm.Ex Tres October 9 1998 Notarial Seal Notary Public 1 8 of 19 pages Landlord initials Tenant initial��"C EXHIBIT "E" SCHEDULE OF PERFORMANCE Item of Performance I Date 1. Participant executes, acknowledges Participant will endeavor to (if appropriate) and submits the submit by October 31, 1995, but Agreement, the Promissory Note and no later than January 15, 1996 the Declaration to Agency. 2. Participant to execute lease The date Participant executes agreement or lease extension for Site the Agreement for an additional ten years, 3. Agency and City hold public hearing As soon as practicable after for Site to authorize execution of Participant submits the Agreement by Agency, and if so documents referenced in 1 and 2 authorized Agency shall promptly above, but no later than execute the Agreement thereafter. February 7, 1996 4. Participant submits final building Within 150 days of the plans to Agency and City for execution of the Agreement by processing and approval. Agency 5. Participant submits Evidence of Within 150 days of the Financial Capability to Executive execution of the Agreement by Director for approval Agency 6. Executive Director to approve Within 30 days of submission Evidence of Financial Capability 7. Pt iits to obtain building Within 300 days of the om the City for the Project execution of this Agreement by Agency8. t submits certificates of Within 30 days of obtaining to Agency and commences building permit for the Project on of the Project on the 9. Agency to make initial disbursement Within 60 days of the issuance under Promissory Note. of a building permit for the Project 10. Participant completes construction of Within 180 days of commencement Project on the Site. of construction 11. Agency to issue Certificate of Within the time specified in Completion Section 4.13 of the Agreement It is understood that this Schedule of Performance is subject to all of the terms and conditions of the text of the Agreement . The summary of the items performance in this Schedule of Performance is not intended to supersede or modify the more complete description in the text; in the event of any conflict or inconsistency between this Schedule of Performance and the text of the Agreement, the text shall govern. The time periods set forth in this Schedule of Performance may be altered by attorney or amended only by written agreement signed by both the Participant and the Agency. The Executive Director of EXHIBIT "E" TO OWNER PARTICIPATION AGREEMENT FS2\383W14084-0006\2155186.2 all/27/95 Agency shall have the authority to approve extensions of time without action of the Board of Directors of Agency not to exceed a cumulative total of 180 days. EXHIBIT "E" TO OWNER PARTICIPATION AGREEMENT F521383101408¢000612155186.2 all/27/95 1 1 I I 1 I 1 PARTS STORAGE PARTS STORAGE I IMIi RLCLIVIM ;f4, I I nk El z ,Z {.:{ii ,{:r ilk�. .; t 3 ..1Rsl•m• � uv ;tail!, {!Ij!{ il FF�1���v 1 1 I w � 'LV � "L':'°' nvu••�ip � !III ^ ' 1 H 17 Ll !III' n.gpo rlp H / j x H — 1113 - }to ai; :! rl:.;.; .. , w ! i.! j ' !`IIII. ...... r}i.11.1.; : .it I..I: Oa � !i!ii�, I; i:��f I.r.IL:. :::,i::nm L:. I l HIM I LULIP. PLAID {I J . v 4N R�ij ,�s�.f �r..'i� ! � fGvlll N11pi �' • J ------------------- 'r. C'�� S'_ _ CVSLPSR»•glxG MAC MAGRUDER CHEVROLET IMAGE cr,evna€r*uoE two FM oEr���r FncunEe oEstaa solver �T. � 02 02 _ __ '•••••»..•" ti %101'O�R.Od11LAN ._ .,,.. `l— ;1 EXHIBIT "G" FREE RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS P.O. Box 2743 Palm Springs, CA 92263 Attn: Executive Director (Space Above This Line For Recorder' s Office Use Only) CERTIFICATE OF COMPLETION WHEREAS, by an Owner Participation Agreement (hereinafter referred to as the "Agreement") dated , 199 , by and between THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS (hereinafter referred to as "Agency") , and MAC MAGRUDER, dba Mac Magruder Chevrolet/Geo (hereinafter referred to as "Participant") , Participant has redeveloped the real property (the "Site") , legally described on Exhibit 1 attached hereto and incorporated herein by reference, according to the terms and conditions of said Agreement; and WHEREAS, pursuant to Section 4 .13 of the Agreement, promptly after completion of all construction work to be completed by Participant upon the Site, and upon request by Participant, Agency shall furnish Participant with a Certificate of Completion in such form as to permit it to be recorded in the Official Records of the County of Riverside; and WHEREAS, the issuance by Agency of the Certificate of Completion shall be conclusive evidence that Participant has complied with the terms of the Agreement pertaining to the redevelopment of the Site; and WHEREAS, Participant has requested that Agency furnish Participant with the Certificate of Completion; and WHEREAS, Agency has conclusively determined that the redevelopment of the Site has been satisfactorily completed as required by the Agreement; and WHEREAS, the Agreement provided for certain covenants to run with the land, which covenants were incorporated in a Declaration of Covenants, Conditions and Restrictions (the "Declaration") ; EXHIBIT "G" TO OWNER PARTICIPATION AGREEMENT PAGE 1 OF 3 PAGES FS2\383\014084-0006\2155186.2 a11/27/95 0 0 NOW, THEREFORE: 1. As provided in the Agreement, Agency does hereby certify that redevelopment of the Site has been fully and satisfactorily performed and completed, and that such redevelopment is in full compliance with said Agreement. 2 . This Certificate shall not constitute evidence of Participant's compliance with the Declaration, the provisions of which shall continue to run with the land. 3 . This Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of Participant to any holder of a mortgage, or any insurer of a mortgage, securing money loaned to finance construction work on the Site, or any part thereof . Nothing contained herein shall modify in any way any other provision of said Agreement. 4 . This Certificate is not a Notice of Completion as referred to in California Civil Code Section 3093 . 5 . Except as stated herein, nothing contained in this instrument shall modify in any way any other provisions of the Agreement or any other provisions of the documents incorporated therein. IN WITNESS WHEREOF, Agency has executed this Certificate as of this day of , 199_. THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS By Executive Director EXHIBIT "G" TO OWNER PARTICIPATION AGREEMENT PAGE 2 OF 3 PAGES FS21300140E4-0006@1SM6.2 e11127195 0 STATE OF CALIFORNIA ) ss. COUNTY OF ) On before me, personally appeared personally known to me (or proved to me on the basis of satisfac- tory evidence) to be the person(s) whose names) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) , and that by his/her/their signatures) on the instrument the person(s) or the entity upon behalf of which the person (s) acted, executed the instrument. Witness my hand .and official seal . [SEAL] Notary Public EXHIBIT "G" TO OWNER PARTICIPATION AGREEMENT PAGE 3 OF 3 PAGES FS2\383\014084.000612155186.2 ell/27/95 Exhibit 1 LEGAL DESCRIPTION OF SITE [To be Inserted] EXHIBIT "1" Bs213383\O14064-oaaX215518e.2 w/2v95TO CERTIFICATE OF COMPLETION EXHIBIT "H" FREE RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: The Community Redevelopment Agency of the City of Palm Springs P.O. Box 2743 Palm Springs, CA 92263 Attn: Executive Director (For Recorder' s Use Only) DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS THIS DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS ( "Declaration") is made this day of 199_ by and among MAC MAGRUDER, dba Mac Magruder Chevrolet/Geo ( "Declarant") , THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic ( "Agency" ) , and THE CITY OF PALM SPRINGS, a municipal corporation ( "City") . R E C I T A L S: A. Declarant is the owner of a leasehold interest in that certain real property located in the City of Palm Springs, County of Riverside, State of California more particularly described on Exhibit "1" attached hereto and incorporated herein by reference ( "Site".) . B. The Site is within the South Palm Canyon Redevelopment Project Area ( "Project Area") specifically described in the Redevelopment Plan for the Project Area which was approved and adopted by the City Council of the City of Palm Springs by Ordinance No. 1203 on December 30, 1983 and as subsequently amended by means of ordinances of the City Council . C. The Agency and the City have fee or easement interests in various streets, sidewalks and other property within the City and are responsible for the planning and development of land within the City in such a manner so as to provide for the health, safety and welfare of the residents of the City. That portion of the Agency' s or City' s interest in real property most directly affected by this Agreement is depicted in Exhibit 112 " attached hereto and incorporated herein by reference ( "Public Parcel" ) . EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 1 OF 14 PAGES F82\383\01408440006\2155186.2 all/27195 D. The purpose of the Redevelopment Plan is to remedy and alleviate blighted conditions associated with undeveloped and unproductive. land, inadequate street and circulation systems, unsuitable land mixes, inadequate or total lack of public street improvements, and the existence of substandard and incompatible uses and structures. The redevelopment and restriction of the Site in accordance with the Redevelopment Plan will promote the utility and value of the Site and of the Project Area, for the benefit of its future owners and the entire city. E. Pursuant to the Redevelopment Plan, Declarant has entered into an Owner Participation Agreement with the Agency which Agreement places certain restrictions on the Site. Pursuant to the City' s development requirements, the City has approved or will approve a site plan for the development of the Site ("Site Plan") , which plan places certain restrictions on the Site. Said Redevelopment Plan, Owner Participation Agreement and Site Plan (i) are on file and may be reviewed in the office of the executive director of the Agency ( "Executive Director") , in the Palm Springs City Hall and (ii) are each incorporated herein by this reference and made a part hereof as though fully set forth herein. F. Declarant, the Agency and City intend, in exchange for the entering into the Owner Participation Agreement by the Agency and the approval of the Site Plan by City, that the Declarant hold, sell, and convey the Site subject to the covenants, conditions, restrictions, and reservations set forth in this Declaration and that the Agency and City shall have the right and power to enforce the covenants, conditions, restrictions, and reservations as provided herein. G. Declarant desires to establish and grant certain covenants, conditions and restrictions upon the property for the benefit of the Agency and the City and their respective successors and assigns for the purpose of enhancing and protecting the value, desirability and attractiveness of the Site and effectuating the Redevelopment Plan. Such covenants, conditions and restrictions shall run to the benefit of the Public Parcel and bind the Site, the Declarant and its successors and assigns . NOW, THEREFORE, the Developer, Agency and City declare, covenant and agree, by and for themselves, their heirs, executors and assigns, and all persons claiming under or through them that the Site shall be held, transferred, encumbered, used, sold, conveyed, leased and occupied subject to the covenants and restrictions hereinafter set forth, which covenants are established expressly and exclusively for the use and benefit of the Agency and City. TERMS AND CONDITIONS EXHIBIT I1H11 TO OWNER PARTICIPATION AGREEMENT PAGE 2 OF 14 PAGES FS2\383\014084-0006\2155186.2 all/27/95 0 ARTICLE I COVENANTS, CONDITIONS AND RESTRICTIONS 1. 1 General . The Site shall be developed and used only as permitted by the restrictions contained in the Site Plan, Redevelopment Plan and Owner Participation Agreement. 1.2 Permitted Use. During the term of this Declaration, Declarant shall use the Site solely for the purpose of conducting and carrying on the business of a new car automobile dealership. In connection with said primary use, Declarant may also operate a used car sales lot, body shop and service facility as ancillary uses . Declarant shall continuously conduct and carry on said business on the Site and shall keep said business open for business during the usual business hours of each and every business day as is customary for businesses of like character to be open for business in the Coachella Valley area; provided, however, that the foregoing shall not apply during the period of any strikes, lockouts or similar causes beyond the reasonable control of Declarant . 1 . 3 Maintenance Agreement. Declarant, for itself and its successors and assigns, hereby covenants and agrees to maintain and repair or cause to be maintained and repaired the Site and all related on-site improvements and landscaping thereon at its sole cost and expense, including, without limitation, buildings, parking areas, lighting, signs and walls, in a first class condition and repair, free of rubbish, debris and other hazards to persons using the same, and in accordance with all applicable laws, rules, ordinances and regulations of all federal, state, and local bodies and agencies having jurisdiction over the Site. Such maintenance and repair shall include, but not be limited to, the following: (i) sweeping and trash removal; (ii) the care and replacement of all shrubbery, plantings, and other landscaping in a healthy condition; and (iii) the repair, replacement and restriping of asphalt or concrete paving using the same type of material originally installed, to the end that such pavings at all times be kept in a level and smooth condition. In addition, Declarant shall be required to maintain the Site in such a manner as to avoid the reasonable determination of a duly authorized official of the Agency or City that a public nuisance has been created by the absence of adequate maintenance such as to be detrimental to the public health, safety or general welfare or that such a condition of deterioration or disrepair causes appreciable harm or is materially detrimental to property or improvements within one thousand (1, 000) feet of such portion of the Site. 1 .4 Parking. Declarant shall use its best efforts to insure that vehicles associated with the operation of the Site, including delivery vehicles, vehicles of customers and employees and vehicles of persons with business on the Site will park solely on the Site and not park on public streets or adjacent property. EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 3 OF 14 PAGES FS2\383\0140840006\2155186.2 all/27/95 1.5 Compliance With Ordinances . Declarant shall comply with all ordinances, regulations and standards of the City and Agency applicable to the Site. Declarant shall comply with all rules and regulations of any assessment district of the City with jurisdiction over the Site. 1. 6 Nondiscrimination. 1. 6 .1 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 Site, or any part thereof, nor shall Declarant, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site, or any part thereof. 1. 6.2 Declarant shall not restrict the rental, sale or lease of any portion of the Site on the basis of race, color, creed, religion, sex, marital status, ancestry or national origin of any person. Any and all agreements relating to the rental, sale or lease of the Site, or any portion thereof, and shall contain the following nondiscrimination and nonsegregation clauses (or clauses substantially similar thereto) : a. Clause for Deeds. The following language shall appear in deeds : "The grantee herein covenants by and for himself or herself, his or her 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, ancestry or national origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself, or any persons claiming under or through him or her, 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. " b. Clause for Leases . The following language shall appear in leases : "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 4 OF 14 PAGES F52\3831014084-0006\2155186.2 all/27/95 i • assigns, and all persons claiming under or through him or her, 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, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the land herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, 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. " C. Clause for Contracts . The following language shall appear in contracts : "There shall be no discrimination against or segregation of any persons or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin in the sale, lease, transfer, use, occupancy, tenure or enjoyment of land, nor shall the transferee himself or herself, or any person claiming under or through him or her, 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 land. " 1. 7 Outside Storage. No storage of any kind shall be permitted outside the building (s) located on the Site except for trash or other storage in any outside storage areas approved by the Agency or as required by law. Adequate trash enclosures shall be provided and screened. Locations of such areas and types of screening must be approved by the Executive Director. Gates for trash storage area shall be kept closed at all times except when in actual use. 1. 8 Buildings and Equipment. Any construction, repair, modification or alteration of any buildings, equipment, structures or improvements on the Site shall be subject to the following restrictions : 1. 8 . 1 All mechanical and electrical fixtures and equipment to be installed on the roof or on the ground shall be EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 5 OF 14 PAGES F82\383\014084-0006\2155186.2 all/27/95 adequately and decoratively screened. The screening must blend with the architectural design of the building (s) . Equipment on the roof must be at least six (6) inches lower than the parapet line and adequately screened. All details and materials of said screening shall be approved by the Executive Director prior to installation. 1. 8 .2 The texture, materials and colors used on the buildings, as well as the design, height, texture and color of fences and walls shall be subject to the approval of the Executive Director. 1. 8 .3 Signs on the Site shall conform to the standards and ordinances of the City and to a uniform design theme approved by the City. Any signs installed on the Site shall conform to said design scheme and shall be approved by the Executive Director prior to installation. 1. 8 .4 Lights installed on the building shall be a decorative design. No lights shall be permitted which may create any glare or have a negative impact on the residential areas, if any, existing around the Site. No light stand on any portion of the Site shall be higher than fifteen (15) feet. The design and location of any lights shall be subject to the approval of the Executive Director. 1. 8 . 5 No fences, signs, gas pumps, or any other similar facilities shall be constructed or provided on the Site without the prior approval of the Executive Director. 1. 8 . 6 Manufacturing plant use may be permitted on the Site, subject to the limitations provided in the Municipal Code of the City. Specifically, prior to such use, suitable evidence must be provided to the Executive Director that no negative environmental effect shall be caused by reason of odor, noise, glare, vibration, fumes, smoke, particulate matter, refuse matter, and that no unsafe or dangerous conditions are to be created such as the manufacture, use or storage of explosive, radioactive materials or other similarly hazardous materials. 1.9 Prohibition on Transfers . During the term of this Agreement, Declarant shall not transfer the Owner Participation Agreement or any of Declarant' s rights thereunder, or any interest in the Site or in the improvements thereon, directly or indirectly, voluntarily or by operation of law, except in accordance with Section 4 . 1. 10 of the Owner Participation Agreement . 1 . 10 Public Agency Rights of Access. Participant hereby grants to the Agency, the City and other public agencies the right, at their sole risk and expense, to enter the Site or any part thereof at all reasonable times with as little interference as possible for the purpose of construction, reconstruction, EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 6 OF 14 PAGES F5Z393\014094-0006\2155136.2 A11/27/95 relocation, maintenance, repair or service of any public improvements or public facilities located on the Site. Any damage or injury to the Site or to the improvements constructed thereon resulting from such entry shall be promptly repaired at the sole expense of the public agency responsible for the entry. ARTICLE II ENFORCEMENT 2 . 1 Termination. No breach of this Declaration shall entitle any party to cancel, rescind or otherwise terminate this Declaration, or excuse the performance of such party's obligations hereunder; provided that, however, this limitation shall not affect in any manner any other rights or remedies which the parties may have by reason of such breach. 2 .2 Injunction. Notwithstanding anything contained herein to the contrary, in the event of any violation or threatened violation of any of the terms, covenants, restrictions and conditions contained herein, in addition to the other remedies herein provided, the parties hereto shall have the right to enjoin such violation or threatened violation in a court of competent jurisdiction. 2 . 3 Other Rights of Agency and City. In the event of any violation or threatened violation of any of the provisions of this Declaration, then in addition to, but not in lieu of, any of the rights or remedies the Agency and City may have to enforce the provisions hereof, the Agency and City shall have the right (i) to enforce the provisions hereof as a party hereto and as an owner of the Public Parcel, and (ii) to withhold or revoke, after giving written notice of said violation, any building permits, occupancy permits, certificates of occupancy, business licenses and similar matters or approvals pertaining to the Site or any part thereof or interests therein as to the violating person or one threatening violation. 2 .4 Failure to Perform• Lien. If any owner of the Site defaults on the performance of any of its obligations hereunder, the Agency or City, their employees, contractors and agents may, at their sole option, and after making reasonable demand of the owner of the Site that it cure said default, enter onto the Site for the purpose of curing the default. In making an entry, the Agency or City shall give the owners of the Site or their representative, reasonable notice of the time and manner of said entry and said entry shall only be at such times and in such manners as is reasonably necessary to carry out this Agreement. In such event, the owner of the Site shall reimburse the Agency or City for all costs and expenses related to the curing of said default. If the Agency or City is not reimbursed for such costs by the owner of the Site within 30 days after giving notice thereof, the same shall be EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 7 OF 14 PAGES F52\383\014084-000612155186.2 all/27/95 i deemed delinquent, and the amount thereof shall bear interest thereafter at a rate of ten percent (10%) per annum until paid. Any and all delinquent amounts, together with said interest, costs and reasonable attorneys fees shall be a personal obligation of the owner of the Site as well as a lien and charge, with power of sale, upon the Site. The Agency may bring an action at law against the owner of the Site to pay any such sums . The lien provided for in this Section 2 .4 may be recorded by the Agency as a Notice of Lien against the Site in the Office of the County Recorder, County of Riverside, signed and acknowledged, which Notice of Lien shall contain a statement of the unpaid amount of costs and expenses . The priority of such lien when so established against the Site shall date from the date such notice is filed of record and shall be prior and superior to any right, title, interest, lien or claim which may be or has been acquired or attached to such real property at the time of recording of such lien, but shall be junior and subordinate to matters having a priority prior to the date such notice is recorded; provided that, however, said lien shall be subordinate to any bona fide mortgage or deed of trust and any purchaser at any foreclosure or trustee' s sale under any such bona fide mortgage or deed of trust as provided in Section 3 .3 below. Such lien shall be for the use and benefit of the person filing the same, and may be enforced and foreclosed in a suit or action brought in any court of competent jurisdiction. Any such lien may be enforced by the Agency or City by taking either or both of the following actions concurrently or separately (and by exercising either of the remedies set forth below shall not prejudice or waive its rights to exercise the remedy) : (i) bring an action at law against the defaulting party personally obligated to pay such lien or (ii) foreclose such lien in accordance with the provisions of Section 2924 of the California Civil Code applicable to the exercise of powers of sale or mortgages and deeds of, trust, or any other manner permitted by California law. Upon the timely curing of any default for which such lien was recorded, the City or Agency shall record an appropriate release of such lien, and sign any other documents reasonably necessary to satisfy title insurance requirements, upon payment by the owner of the Site of a reasonable fee to cover the costs of preparing and recording such release, together with the payment of such other costs, including without limitation, reasonable attorneys fees, court costs, interest or other fees which have been incurred. ARTICLE III ENCUMBRANCES, MORTGAGE PROTECTION AND TAXES 3 . 1 Participant' s Breach Not to Default MortcracTe Lien. Declarant' s breach of any, of the covenants or restrictions contained in this Declaration or the Owner Participation Agreement shall not defeat or render invalid the lien. of any mortgage or deed EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 8 OF 14 PAGES FS2\383\014084-0006\2155186.2 a11/27/95 0 of trust made in good faith and for value as to the Site or any part thereof or interest therein, whether or not said mortgage or deed of trust is subordinated to this Declaration or the Owner Participation Agreement; but, unless otherwise herein provided, the terms, conditions, covenants, restrictions and reservations of this Declaration and the Owner Participation Agreement shall be binding and effective against the holder of any such mortgage or deed of trust and any owner of any of the Site or any part thereof whose title thereto is acquired by foreclosure, trustee' s sale, or otherwise. 3 .2 Amendments or Modifications to Declaration. No purported rule, regulation, modification, amendment and/or termination of this Declaration or the Owner Participation Agreement shall be binding upon or affect the rights of any mortgagee holding a mortgage or deed of trust upon the Site that is recorded in the Office of the Riverside County Recorder prior to the date any such rule, regulation, modification, amendment or termination is recorded in such office, without the prior written consent of such mortgagee. 3 .3 Liens Subordinate. Any monetary lien provided for herein shall be subordinate to any bona fide mortgage or deed of trust covering an ownership interest or leasehold or subleasehold estate in and to the Site and any purchaser at any foreclosure or trustee' sale (as well as any by deed or assignment in lieu of foreclosure or trustee' s sale) under any such mortgage or deed of trust shall take title free from any such monetary lien, but otherwise subject to the provisions hereof; provided that, after the foreclosure of any such mortgage and/or deed of trust, all other assessments provided for herein to the extent they relate to the expenses incurred subsequent to such foreclosure, assessed hereunder to the purchaser at the foreclosure sale, as owner of the Site after the date of such foreclosure sale, shall become a lien upon the Site and may be perfected and foreclosed as provided in Section 2 .4 . 3 .4 Payment of Taxes and Assessments . Declarant shall pay, when due, all real estate taxes and assessments assessed or levied against the Site. Nothing herein contained shall be deemed or prohibit Declarant from contesting the validity or amounts of any tax or assessments nor to limit the remedies available to Declarant with respect thereto. ARTICLE IV COVENANTS TO RUN WITH THE LAND 4 . 1 Covenants Running With the Land. This Declaration is designed to create equitable servitudes and covenants appurtenant to the Public Parcel and running with the Site. Declarant hereby declares that all of the Site shall be held, sold, conveyed, encumbered, hypothecated, leased, used, occupied and improved EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 9 OF 14 PAGES FS2\383\014084-0006\2155186.2 all/27/95 i • subject to the covenants, conditions, restrictions and equitable servitudes, all of which are for the purposes of uniformly enhancing or protecting the value, attractiveness and desirability of the Site and effectuating the Redevelopment Plan. The covenants, conditions, restrictions, reservations, equitable servitudes, liens and charges set forth herein shall run with the Site and shall be binding upon all persons having any right, title or interest in the Site, or any part thereof, their heirs, successive owners and assigns; shall inure to the benefit of every portion of the Public Parcel and any interest therein; shall inure to the benefit of the Agency, the City and their successors and assigns and successors in interest; shall be binding upon Declarant, its successors and assigns and successors in interest; and may be enforced by the Agency and City. Agency and Declarant hereby declare their understanding and intent that the burden of the covenants set forth herein touch and concern the land in that Declarant' s legal interest in the Site is rendered less valuable thereby. Agency and Declarant hereby further declare their understanding and intent that the benefit of such covenants touch and concern the land by enhancing and increasing the enjoyment and use of the Site by the citizens of the City and by furthering the public purposes for which the Agency was formed. 4 .2 _Agreement Among Declarant Agency and City. The Declarant, in exchange for entering the Owner Participation Agreement by the Agency and granting of the Site Plan by City, hereby agrees to hold, sell, and convey the Site subject to the covenants, conditions, restrictions and reservations of this Declaration. Declarant also grants to the Agency and City the right and power to enforce the covenants, conditions, restrictions and reservations contained in this Declaration against the Declarant and all persons having any right, title or interest in the Site, or any part thereof, their heirs, successive owners and assigns . ARTICLE V TERM The covenants, conditions and restrictions contained in this Declaration shall remain in effect for a period of ten (10) years from the date this Declaration is recorded in the Official Records of the Riverside County Recorder; provided that, however, the covenants contained in Section 1 . 6 shall remain in effect in perpetuity. EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 10 OF 14 PAGES F82\300140840006\2155186.2 all/27/95 ARTICLE VI MISCELLANEOUS 6 .1 Modification. This Declaration may not be modified, terminated or rescinded, in whole or in part, except by a written instrument duly executed and acknowledged by the parties hereto, their successors or assigns and duly recorded in the Office of the County Recorder, County of Riverside. 6.2 Governing Law. This Declaration shall be governed by and construed in accordance with the laws of the State of California. 6 .3 Severability. The invalidity or unenforceability of any provision of this Declaration with respect to a particular party or set of circumstances shall not in any way affect the validity and enforceability of any other provision hereof, or the same provision when implied to another party or to a different set of circumstances . 6 .4 Notices. Any notice to be given under this Declaration shall be given by personal delivery or by depositing the same in the United States Mail, certified or registered, postage prepaid, at the following address: Agency: The Community Redevelopment Agency of The City of Palm Springs P.O. Box 2743 Palm Springs, CA 92263 Attn: Executive Director City: City of Palm Springs P.O. Box 2743 Palm Springs, CA 92263 Attn: City Manager With Copy to: Rutan & Tucker 611 Anton Blvd. , Suite 1400 Costa Mesa, CA 92623-9990 Attn: David J. Aleshire, Esq. Declarant: Mac Magruder Chevrolet/Geo 999 South Palm Canyon Drive Palm Springs, CA 92262 Attn: Mac Magruder Any notice delivered personally shall be effective upon delivery. Any notice given by mail as above provided shall be effective forty-eight (48) hours after deposit in the mails . Any party may change address for notice by giving written notice of such change to the other party. EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 11 OF 14 PAGES FS2\383\014084-0006\2155186.2 all/27/95 i • 6 .5 Counterparts . This Declaration may be executed in any number of counterparts each of which shall be an original but all of which shall constitute one and the same document. IN WITNESS WHEREOF, the undersigned have executed this Agreement was executed as of the date first written above. MAC MAGRUDER, dba Mac Magruder Chevrolet/Geo "Declarant" ATTEST: COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate , and politic By: By: Assistant Secretary Chairman "Agency" ATTEST: CITY OF PALM SPRINGS, a municipal corporation By: By: City Clerk Mayor "City" APPROVED AS TO FORM: RUTAN & TUCKER David J. Aleshire, Agency Counsel and City Attorney EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 12 OF 14 PAGES FS2\383\0140840006\2155186.2 all/27/95 0 STATE OF CALIFORNIA ) ss. COUNTY OF ) On before me, personally appeared personally known to me (or proved to me on the basis of satisfac- tory evidence) to be the person(s) whose names) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) , and that by his/her/their signature (s) on the instrument the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal. [SEAL] Notary Public STATE OF CALIFORNIA ) ss . COUNTY OF ) On before me, personally appeared personally known to me (or proved to me on the basis of satisfac- tory evidence) to be the person(s) whose name (s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) , and that by his/her/their signature (s) on the instrument the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal . [SEAL] Notary Public EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 13 OF 14 PAGES FS2\ U014084-000612155186.2 a11127195 0 STATE OF CALIFORNIA ) ss . COUNTY OF ) On before me, personally appeared personally known to me (or proved to me on the basis of satisfac- tory evidence) to be the person(s) whose name (s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) , and that by his/her/their signature (s) on the instrument the person (s) or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal . Notary Public [SEAL] EXHIBIT "H" TO OWNER PARTICIPATION AGREEMENT PAGE 14 OF 14 PAGES F92\3831014084-0006\2155186.2 all/27/95 r EXHIBIT LEGAL DESCRIPTION OF THE SITE The Easterly 470 feet of the South one-half of the Southeasterly one-quarter of the Southeasterly one-quarter of the Northeasterly one-quarter of Section 22, Township 4 South Range 4 East San Bernardino Base and Meridian, Riverside County, California, excepting the Southerly forty-four feet for street purposes and excepting that portion lying within the State Highway on the East, containing 3 . 0 acres, more or less. EXHIBIT TO DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS F52\3831014084-000612155186.2 al1/27/95 EXHIBIT „2„ DEPICTION OF PUBLIC PARCEL /5 J4 23 SEE SEE 2 2 26 27 MAP NAP v 2cg 2 Q 27 26 vi OP' 5 SIFE l.90AL{• 23 ® MAP 29 /e.rJa�.t 29 3 es� z9.zr• — — _. _ — � _ — Po` 508 L//Aa'�� � 6060-J01 L66Ac_ "139dZ �A— L,.c, n EX a,%„ �O• SUNM nuHE3 es a. c EX ^f 77 / 25.56ACY £X. A.s Ae 4 / M"1 /9.39Ac? a/ 1 / EX. J o O3 / 2 O.JJA6.+ D n .n rs ©Ex. r i 1 yJ; a+. 9.52Ac.t P.4 tile% t / 406X t EXHIBIT "2 " TO DECLARATION OF COVENANTS, FS2\3 831014 0 8 4A0 0 6121 5 5 1S6.2 a1/27/95 CONDITIONS AND RESTRICTIONS EXHIBIT "I" UNSECURED PROMISSORY NOTE $200, 000 . 00 199 Palm Springs, California FOR VALUE RECEIVED, the undersigned ( "Maker") hereby promises to pay to the order of the COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, public body, corporate and politic ( "Holder") , at a place designated by Holder, the principal sum of TWO HUNDRED THOUSAND DOLLARS ($200, 000 . 00) or such lesser amount which shall from time to time be owing hereunder on account of unpaid advances made by Holder to or for the benefit of Maker. The principal sum hereof shall be disbursed pursuant to the terms and conditions set forth in that certain Owner Participation Agreement of even date herewith by and between Maker and Holder ( "OPA" ) . Any capitalized terms not defined herein shall have the meanings ascribed to them in the OPA. 1. Repayment by Maker. Unless Maker shall have defaulted under the OPA, the Declaration, or breached any promise or obligation in this Note or in any other instrument now or hereafter securing the indebtedness evidenced hereby, (i) no interest shall accrue on the unpaid principal of this Note and (ii) a portion of the total principal advanced hereunder shall be forgiven on each anniversary date of the recordation of the Declaration in an amount equal to the total principal advanced hereunder divided by ten (10) . Any payments made by Maker in payment of this Note shall be applied first to the interest then accrued and due on the unpaid principal balance under this Note, and the remainder of each payment shall be applied to the reduction of the unpaid principal . 2 . Prepayment . This Note may be prepaid in whole or in part at any time without penalty. 4 . Acceleration of Obligation. Upon the failure to make a payment that may become due under this Note (whether by extension, acceleration or otherwise) , or in the event of default under the OPA or the Declaration, or any breach of any other promise or obligation in this Note or in any other instrument now or hereafter securing the indebtedness evidenced hereby, then, and in any of such events, Holder may, at its option, declare this Note and the entire indebtedness hereby evidenced that has not been forgiven pursuant to Section 1 above to be immediately due and payable and collectible then or thereafter as Holder may elect, regardless of the date of maturity, and notice of the exercise of said option is hereby expressly waived by Maker. EXHIBIT "I" TO OWNER PARTICIPATION AGREEMENT PAGE 1 OF 3 PAGES FS2083\0140840006\2155186.2 all/27/95 5 . Default Interest. If any event occurs giving Holder the right to accelerate this Note pursuant to Section 4 above, the entire unpaid and unforgiven principal owing hereunder shall commence to accrue interest at a rate equal to three percentage points above the Reference Rate published by Bank of America N.A. , or the maximum non-usurious interest rate permitted by law, whichever is less . 6 . Collection Costs , Attorneys' Fees . If any attorney is engaged by Holder because of any event of default under this Note or to enforce of defend any provision of either instrument, whether or not suit is filed hereon, then Maker shall pay upon demand reasonable attorneys' fees and all costs so incurred by Holder together with interest thereon until paid at the applicable rate of interest payable hereunder, as if such fees and costs had been added to the principal owing hereunder. 7. Waivers by Maker. Maker and all endorsers, guarantors and persons liable or to become liable on this Note waive presentment, protest and demand, notice of protest, demand and dishonor and nonpayment of this Note and any and all other notices or matters of a like nature, and consent to any and all renewals and extensions near the time of payment hereof and agree further that at any time and from time to time without notice, the terms of payment herein may be modified or the security described in any documents securing this Note released in whole or in part, or increased, changed or exchanged by agreement between Holder and any owner of the premises affected by said documents securing this Note, without in any way affecting the liability of any party to this Note or any persons liable or to become liable with respect to any indebtedness evidenced hereby. 9 . Severability. The unenforceability or invalidity of any provision or provisions of this Note as to any persons or circumstances shall not render that provision or those provisions unenforceable or invalid as to any other provisions or circum- stances, and all provisions hereof, in all other respects, shall remain valid and enforceable. 10 . Modifications. Neither this Note nor any term hereof may be waived, amended, discharged, modified, changed or terminated orally; nor shall any waiver of any provision hereof be effective except by an instrument in writing signed by Maker and Holder. No delay or omission on the part of Holder in exercising any right hereunder shall operate as a waiver of such right or of any other right under this Note. 11 . No Waiver by Holder. No waiver of any breach, default or failure of condition under the terms of this Note shall be implied from any failure of the Holder of this Note to take, or any delay be implied from any failure by the Holder in taking action with EXHIBIT "I" TO OWNER PARTICIPATION AGREEMENT PAGE 2 OF 3 PAGES FS2\383\014084-0006\2155186.2 a1V27/95 • 9 respect to such breach, default or failure from any prior waiver of any similar or unrelated breach, default or failure. 12 . Usury. Notwithstanding any provision in this Note, the total liability for payment in the nature of interest shall not exceed the limit now imposed by applicable laws of the State of California. 13 . Governing Law. This Note has been executed and delivered by Maker in the State of California and is to be governed and construed in accordance with the laws thereof. IN WITNESS WHEREOF, Maker has executed this Note as of the date and year first above written. MAC MAGRUDER, dba Mac Magruder Chevrolet/Geo "Maker" EXHIBIT "I" TO OWNER PARTICIPATION AGREEMENT PAGE 3 OF 3 PAGES F82\383\014084-0006\2155186.2 •11/27/95 EXHIBIT "J" DISCLOSURE OF HAZARDOUS MATERIALS Participant uses on the Site those Hazardous Materials typically used at a new car dealership with a service facility including gasoline and other petroleum products. Said Hazardous Materials are only kept in those quantities reasonably necessary for the operation of said automobile dealership business on the Site and are used, stored, maintained and disposed of in accordance with applicable Environmental Law. EXHIBIT "J" TO OWNER PARTICIPATION AGREEMENT FS2\383\0140840006\2155186.2 all/27/95 DOG a 1999-21; 2Zoa 05/17/1999 08:00A Fee:NC Page 1 of 15 Recorded in Official Records River FREE RECORDING REQUESTED BY County Garyf L. Orsoo side AND WHEN RECORDED MAIL TO: Assessor, County Clerk & Recorder The Agency�ofnthe City vofalm Redevelopment 1111IIIIIIIIIIIII1IIIIIIIII11I �11 111111111 P.O. Box 2743 Palm Springs, CA 92263 A S U PAGE SIZE DA PCOR NOCOR SMF MISC. Attn: Executive Director A R L COPY LONG REFUND NCHG EXAM DECLARATION OF COVENANTS CONDITIONS }� + AND RESTRICTIONS THIS DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS ( "Declaration") is made this /6 day of 1999 by and among MAC MAGRUDER, dba Mac Magruder Chevrolet Geo ( "Declarant") , THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic ("Agency") , and $F THE CITY OF PALM SPRINGS, a municipal corporation ("City") co 0 i A. Declarant is the owner of a leasehold interest in that s certain real property located in the City of Palm Springs, County of Riverside, State of California more particularly described on v Exhibit "1" attached hereto and incorporated herein by reference _ ("Site".) . L ns r- m <r qk U B. The Site is within the South Palm Canyon Redevelopment M Project Area ( "Project Area") specifically described in the u Jz Redevelopment Plan for the Project Area which was approved and W adopted by the City Council of the City of Palm Springs by W Pl: m M C, Ordinance No. 1203 on December 30, 1983 and as subsequently amended a o W a m qtz by means of ordinances of the City Council . C. The Agency and the City have fee or easement interests in various streets, sidewalks and other property within the City and are responsible for the planning and development of land within the City in such a manner so as to provide for the health, safety and welfare of the residents of the City. That portion of the Agency's or City' s interest in real property most directly affected by this Agreement is depicted in Exhibit "2" attached hereto and incorporated herein by reference ( "Public Parcel") . F32U9310409COMU155196.2 a11I27193 21220s D. The purpose of the Redevelopment Plan is to remedy and alleviate blighted conditions associated with undeveloped and unproductive. land, inadequate street and circulation systems, unsuitable land mixes, inadequate or total lack of public street improvements, and the existence of substandard and incompatible uses and structures. The redevelopment and restriction of the Site in accordance with the Redevelopment Plan will promote the utility and value of the Site and of the Project Area, for the benefit of its future owners and the entire city. E. Pursuant to the Redevelopment Plan, Declarant has entered into an Owner Participation Agreement with the Agency which Agreement places certain restrictions on the Site. Pursuant to the City' s development requirements, the City has approved or will approve a site plan for the development of the Site ("Site Plan") , which plan places certain restrictions on the Site. Said Redevelopment Plan, Owner Participation Agreement and Site Plan (i) are on file and may be reviewed in the office of the executive director of the Agency ( "Executive Director") , in the Palm Springs City Hall and (ii) are each incorporated herein by this reference and made a part hereof as though fully set forth herein. F. Declarant, the Agency and City intend, in exchange for the entering into the Owner Participation Agreement by the Agency and the approval of the Site Plan by City, that the Declarant hold, sell, and convey the Site subject to the covenants, conditions, restrictions, and reservations set forth in this Declaration and that the Agency and City shall have the right and power to enforce the covenants, conditions, restrictions, and reservations as provided herein. G. Declarant desires to establish and grant certain covenants, conditions and restrictions upon the property for the benefit of the Agency and the City and their respective successors and assigns for the purpose of enhancing and protecting the value, desirability and attractiveness of the Site and effectuating the Redevelopment Plan. Such covenants, conditions and restrictions shall run to the benefit of the Public Parcel and bind the Site, the Declarant and its successors and assigns. NOW, THEREFORE, the Developer, Agency and City declare, covenant and agree, by and for themselves, their heirs, executors and assigns, and all persons claiming under or through them that the Site shall be held, transferred, encumbered, used, sold, conveyed, leased and occupied subject to the covenants and restrictions hereinafter set forth, which covenants are established expressly and exclusively for the use and benefit of the Agency and City. TERMS AND CONDITIONS PAGE 2 OF 14 PAGES PS2 SM014Ob1-0006\2155196.2 dl/27/95 - • • 212208 ARTICLE I COVENANTS, CONDITIONS AND RESTRICTIONS 1.1 General. The Site shall be developed and used only as permitted by the restrictions contained in the Site Plan, Redevelopment Plan and Owner Participation Agreement. 1.2 Permitted Use. During the term of this Declaration, Declarant shall use the Site solely for the purpose of conducting and carrying on the business of a new car automobile dealership. In connection with said primary use, Declarant may also operate a used car sales lot, body shop and service facility as ancillary uses. Declarant shall continuously conduct and carry on said business on the Site and shall keep said business open for business during the usual business hours of each and every business day as is customary for businesses of like character to be open for business in the Coachella Valley area; provided, however, that the foregoing shall not apply during the period of any strikes, lockouts or similar causes beyond the reasonable control of Declarant. 1.3 Maintenance Agreement. Declarant, for itself and its successors and assigns, hereby covenants and agrees to maintain and repair or cause to be maintained and repaired the Site and all related on-site improvements and landscaping thereon at its sole cost and expense, including, without limitation, buildings, parking areas, lighting, signs and walls, in a first class condition and repair, free of rubbish, debris and other hazards to persons using the same, and in accordance with all applicable laws, rules, ordinances and regulations of all federal, state, and local bodies and agencies having jurisdiction over the Site. Such maintenance and repair shall include, but not be limited to, the following: (i) sweeping and trash removal; (ii) the care and replacement of all shrubbery, plantings, and other landscaping in a healthy condition; and (iii) the repair, replacement and restriping of asphalt or concrete paving using the same type of material originally installed, to the end that such pavings at all times be kept in a level and smooth condition. In addition, Declarant shall be required to maintain the Site in such a manner as to avoid the reasonable determination of a duly authorized official of the Agency or City that a public nuisance has been created by the absence of adequate maintenance such as to be detrimental to the public health, safety or general welfare or that such a condition of deterioration or disrepair causes appreciable harm or is materially detrimental to property or improvements within one thousand (1, 000) feet of such portion of the Site. 1.4 Parking. Declarant shall use its best efforts to insure that vehicles associated with the operation of the Site, including delivery vehicles, vehicles of customers and employees and vehicles of persons with business on the Site will park solely on the Site and not park on public streets or adjacent property. PAGE 3 OF 14 PAGES F52\383\014084-M\2155196.2 a11/27/93 0 0 ,, 208 1.5 Compliance With Ordinances . Declarant shall comply with all ordinances, regulations and standards of the City and Agency applicable to the Site. Declarant shall comply with all rules and regulations of any assessment district of the City with jurisdiction over the Site. 1 . 6 Nondiscrimination. 1. 6 . 1 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 Site, or any part thereof, nor shall Declarant, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site, or any part thereof. 1. 6 .2 Declarant shall not restrict the rental, sale or lease of any portion of the Site on the basis of race, color, creed, religion, sex, marital status, ancestry or national origin of any person. Any and all agreements relating to the rental, sale or lease of the Site, or any portion thereof, and shall contain the following nondiscrimination and nonsegregation clauses (or clauses substantially similar thereto) : a. Clause for Deeds. The following language shall appear in deeds : "The grantee herein covenants by and for himself or herself, his or her 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, ancestry or national origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself, or any persons claiming under or through him or her, 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. " b. Clause for Leases. The following language shall appear in leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and PAGE 4 OF 14 PAGES P52\363\0140E4-0006\2155196.2 a11/27195 i 212208 assigns, and all persons claiming under or through him or her, 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, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the land herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, 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. " C. Clause for Contracts. The following language shall appear in contracts : "There shall be no discrimination against or segregation of any persons or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or, national origin in the sale, lease, transfer, use, occupancy, tenure or enjoyment of land, nor shall the transferee himself or herself, or any person claiming under or through him or her, 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 land. " 1.7 Outside Storage. No storage of any kind shall be permitted outside the building(s) located on the Site except for trash or other storage in any outside storage areas approved by the Agency or as required by law. Adequate trash enclosures shall be provided and screened. Locations of such areas and types of screening must be approved by the Executive Director. Gates for trash storage area shall be kept closed at all times except when in actual use. 1.8 Buildings and Equipment. - Any construction, repair, modification or alteration of any buildings, equipment, structures or improvements on the Site shall be subject to the following restrictions: 1. 8 . 1 All mechanical and electrical fixtures and equipment to be installed on the roof or on the ground shall be PAGE 5 OF 14 PAGES P82\383\0140840006\2155186.2 aII/27/95 212208 adequately and decoratively screened. The screening must blend with the architectural design of the building (s) . Equipment on the roof must be at least six (6) inches lower than the parapet line and adequately screened. All details and materials of said screening shall be approved by the Executive Director prior to installation. 1. 8 .2 The texture, materials and colors used on the buildings, as well as the design, height, texture and color of fences and walls shall be subject to the approval of the Executive Director. 1. 8 .3 Signs on the Site shall conform to the standards and ordinances of the City and to a uniform design theme approved by the City. Any signs installed on the Site shall conform to said design scheme and shall be approved by the Executive Director prior to installation. 1. 8 .4 Lights installed on the building shall be a decorative design. No lights shall be permitted which may create any glare or have a negative impact on the residential areas, if any, existing around the Site. No light stand on any portion of the Site shall be higher than fifteen (15) feet. The design and location of any lights shall be subject to the approval of the Executive Director. 1. 8 .5 No fences, signs, gas pumps, or any other similar facilities shall be constructed or provided on the Site without the prior approval of the Executive Director. 1. 8.6 Manufacturing plant use may be permitted on the Site, subject to the limitations provided in the Municipal Code of the City. Specifically, prior to such use, suitable evidence must be provided to the Executive Director that no negative environmental effect shall be caused by reason of odor, noise, glare, vibration, fumes, smoke, particulate matter, refuse matter, and that no unsafe or dangerous conditions are to be created such as the manufacture, use or storage of explosive, radioactive materials or other similarly hazardous materials. 1.9 Prohibition on Transfers . During the term of this Agreement, Declarant shall not transfer the Owner Participation Agreement or any of Declarant's rights thereunder, or any interest in the Site or in the improvements thereon, directly or indirectly, voluntarily or by operation of law, except in accordance with Section 4. 1.10 of the Owner Participation Agreement. 1.10 Public Agency Rights of Access. Participant hereby grants to the Agency, the City and other public agencies the right, at their sole risk and expense, to enter the Site or any part thereof at all reasonable times with as little interference as possible for the purpose of construction, reconstruction, PAGE 6 OF 14 PAGES FS2\393\0140U-0006\2155196.2 dl/27/95 • • 222208 relocation, maintenance, repair or service of any public improvements or public facilities located on the Site. Any damage or injury to the Site or to the improvements constructed thereon resulting from such entry shall be promptly repaired at the sole expense of the public agency responsible for the entry. ARTICLE II ENFORCEMENT 2 . 1 Termination. No breach of this Declaration shall entitle any party to cancel, rescind or otherwise terminate this Declaration, or excuse the performance of such party' s obligations hereunder; provided that, however, this limitation shall not affect in any manner any other rights or remedies which the parties may have by reason of such breach. 2 .2 Injunction. Notwithstanding anything contained herein to the contrary, in the event of any violation or threatened violation of any of the terms, covenants, restrictions and conditions contained herein, in addition to the other remedies herein provided, the parties hereto shall have the right to enjoin such violation or threatened violation in a court of competent jurisdiction. 2 .3 Other Rights of Agency and City. In the event of any violation or threatened violation of any of the provisions of this Declaration, then in addition to, but not in lieu of, any of the rights or remedies the Agency and City may have to enforce the provisions hereof, the Agency and City shall have the right (i) to enforce the provisions hereof as a party hereto and as an owner of the Public Parcel, and (ii) to withhold or revoke, after giving written notice of said violation, any building permits, occupancy permits, certificates of occupancy, business licenses and similar matters or approvals pertaining to the Site or any part thereof or interests therein as to the violating person or one threatening violation. 2 .4 Failure to Perform; Lien. If any owner of the Site defaults on the performance of any of its obligations hereunder, the Agency or City, their employees, contractors and agents may, at their sole option, and after making reasonable demand of the owner of the Site that it cure said default, enter onto the Site for the purpose of curing the default. In making an entry, the Agency or City shall give the owners of the Site or their representative, reasonable notice of the time and manner of said entry and said entry shall only be at such times and in such manners as is reasonably necessary to carry out this Agreement. In such event, the owner of the Site shall reimburse the Agency or City for all costs and expenses related too the curing of said default. If the Agency or City is not reimbursed for such costs by the owner of the Site within 30 days after giving notice thereof, the same shall be PAGE 7 OF 14 PAGES Ps2\393%014084-ODN\2155196.2 a11127193 0 r 212208 deemed delinquent, and the amount thereof shall bear interest thereafter at a rate of ten percent (10t) per annum until paid. Any and all delinquent amounts, together with said interest, costs and reasonable attorneys fees shall be a personal obligation of the owner of the Site as well as a lien and charge, with power of sale, upon the Site. The Agency may bring an action at law against the owner of the Site to pay any such sums . The lien provided for in this Section 2 .4 may be recorded by the Agency as a Notice of Lien against the Site in the Office of the County Recorder, County of Riverside, signed and acknowledged, which Notice of Lien shall contain a statement of the unpaid amount of costs and expenses. The priority of such lien when so established against the Site shall date from the date such notice is filed of record and shall be prior and superior to any right, title, interest, lien or claim which may be or has been acquired or attached to such real property at the time of recording of such lien, but shall be junior and subordinate to matters having a priority prior to the date such notice is recorded; provided that, however, said lien shall be subordinate to any bona fide mortgage or deed of trust and any purchaser at any foreclosure or trustee' s sale under any such bona fide mortgage or deed of trust as provided in Section 3 .3 below. Such lien shall be for the use and benefit of the person filing the same, and may be enforced and foreclosed in a suit or action brought in any court of competent jurisdiction. Any such lien may be enforced by the Agency or City by taking either or both of the following actions concurrently or separately (and by exercising either of the remedies set forth below shall not prejudice or waive its rights to exercise the remedy) : (i) bring an action at law against the defaulting party personally obligated to pay such lien or (ii) foreclose such lien in accordance with the provisions of Section 2924 of the California Civil Code applicable to the exercise of powers of sale or mortgages and deeds of trust, or any other manner permitted by California law. Upon the timely curing of any default for which such lien was recorded, the City or Agency shall record an appropriate release of such lien, and sign any other documents reasonably necessary to satisfy title insurance requirements, upon payment by the owner of the Site of a reasonable fee to cover the costs of preparing and recording such release, together with the payment of such other costs, including without limitation, reasonable attorneys fees, court costs, interest or other fees which have been incurred. ARTICLE III ENCUMBRANCES, MORTGAGE PROTECTION AND TAXES 3 .1 Participant' s Breach Not to Default Mortgage Lien. Declarant' s breach of any, of the covenants or restrictions contained in this Declaration or the Owner Participation Agreement shall not defeat or render invalid the lien.of any mortgage or deed PAGE 8 OF 14 PAGES P521393101/084-000M2155166.2 a11/27/93 • • 212208 of trust made in good faith and for value as to the Site or any part thereof or interest therein, whether or not said mortgage or deed of trust is subordinated to this Declaration or the Owner Participation Agreement; but, unless otherwise herein provided, the terms, conditions, covenants, restrictions and reservations of this Declaration and the Owner Participation Agreement shall be binding and effective against the holder of any such mortgage or deed of trust and any owner of any of the Site or any part thereof whose title thereto is acquired by foreclosure, trustee' s sale, or otherwise. 3 .2 Amendments or Modifications to Declaration. No purported rule, regulation, modification, amendment and/or termination of this Declaration or the Owner Participation Agreement shall be binding upon or affect the rights of any mortgagee holding a mortgage or deed of trust upon the Site that is recorded in the Office of the Riverside County Recorder prior to the date any such rule, regulation, modification, amendment or termination is recorded in such office, without the prior written consent of such mortgagee. 3 .3 Liens Subordinate. Any monetary lien provided for herein shall be subordinate to any bona fide mortgage or deed of trust covering an ownership interest or leasehold or subleasehold estate in and to the Site and any purchaser at any foreclosure or trustee' sale (as well as any by deed or assignment in lieu of foreclosure or trustee' s sale) under any such mortgage or deed of trust shall take title free from any such monetary lien, but otherwise subject to the provisions hereof; provided that, after the foreclosure of any such mortgage and/or deed of trust, all other assessments provided for herein to the extent they relate to the expenses incurred subsequent to such foreclosure, assessed hereunder to the purchaser at the foreclosure sale, as owner of the Site after the date of such foreclosure sale, shall become a lien upon the Site and may be perfected and foreclosed as provided in Section 2 .4. 3 .4 Payment of Taxes and Assessments. Declarant shall pay, when due, all real estate taxes and assessments assessed or levied against the Site. Nothing herein contained shall be deemed or prohibit Declarant from contesting the validity or amounts of any tax or assessments nor to limit the remedies available to Declarant with respect thereto. ARTICLE IV COVENANTS TO RUN WITH THE LAND 4 .1 Covenants Running With the Land. This Declaration is designed to create equitable servitudes and covenants appurtenant to the Public Parcel and running with the Site. Declarant hereby declares that all of the Site shall be held, sold, conveyed, encumbered, hypothecated, leased, used, occupied and improved PAGE 9 OF 14 PAGES FS21383\014084-0006\2155186.2 a11127M 0 • 212208 subject to the covenants, conditions, restrictions and equitable servitudes, all of which are for the purposes of uniformly enhancing or protecting the value, attractiveness and desirability of the Site and effectuating the Redevelopment Plan. The covenants, conditions, restrictions, reservations, equitable servitudes, liens and charges set forth herein shall run with the Site and shall be binding upon all persons having any right, title or interest in the Site, or any part thereof, their heirs, successive owners and assigns; shall inure to the benefit of every portion of the Public Parcel and any interest therein; shall inure to the benefit of the Agency, the City and their successors and assigns and successors in interest; shall be binding upon Declarant, its successors and assigns and successors in interest; and may be enforced by the Agency and City. Agency and Declarant hereby declare their understanding and intent that the burden of the covenants set forth herein touch and concern the land in that Declarant's legal interest in the Site is rendered less valuable thereby. Agency and Declarant hereby further declare their understanding and intent that the benefit of such covenants touch and concern the land by enhancing and increasing the enjoyment and use of the Site by the citizens of the City and by furthering the public purposes for which the Agency was formed. 4 .2 Agreement Among Declarant Agency and Citv. The Declarant, in exchange for entering the Owner Participation Agreement by the Agency and granting of the Site Plan by City, hereby agrees to hold, sell, and convey the Site subject to the covenants, conditions, restrictions and reservations of this Declaration. Declarant also grants to the Agency and City the right and power to enforce the covenants, conditions, restrictions and reservations contained in this Declaration against the Declarant and all persons having any right, title or interest in the Site, or any part thereof, their heirs, successive owners and assigns. ARTICLE V TERM The covenants, conditions and restrictions contained in this Declaration shall remain in effect for a period of ten (10) years from the date this Declaration is recorded in the Official Records of the Riverside County Recorder; provided that, however, the covenants contained in Section 1.6 shall remain in effect in perpetuity. PAGE 10 OF 14 PAGES FSMSM0140II40006\2155196,2 a11127/95 • • zzzz�8 ARTICLE VI MISCELLANEOUS 6 . 1 Modification. This Declaration may not be modified, terminated or rescinded, in whole or in part, except by a written instrument duly executed and acknowledged by the parties hereto, their successors or assigns and duly recorded in the Office of the County Recorder, County of Riverside. 6 .2 Governing Law. This Declaration shall be governed by and construed in accordance with the laws of the State of California. 6 .3 Severability. The invalidity or unenforceability of any provision of this Declaration with respect to a particular party or set of circumstances shall not in any way affect the validity and enforceability of any other provision hereof, or the same provision when implied to another party or to a different set of circumstances. 6.4 Notices. Any notice to be given under this Declaration shall be given by personal delivery or by depositing the same in the United States Mail, certified or registered, postage prepaid, at the following address: Agency: The Community Redevelopment Agency of The City of Palm Springs P.O. Box 2743 Palm Springs, CA 92263 Attn: Executive Director City: City of Palm Springs P.O. Box 2743 Palm Springs, CA 92263 Attn: City Manager With Copy to: Rutan & Tucker 611 Anton Blvd. , Suite 1400 Costa Mesa, CA 92623-9990 Attn: David J. Aleshire, Esq. Declarant: Mac Magruder Chevrolet/Geo 999 South Palm Canyon Drive Palm Springs, CA 92262 Attn: Mac Magruder Any notice delivered personally shall be effective upon delivery. Any notice given by mail as above provided shall be effective forty-eight (48) hours after .deposit in the mails. Any party may change address for notice by giving written notice of such change to the other party. PAGE 11 OF 14 PAGES FS2\383\0140M-0006\2155186.2 a11/27/95 • 212208 6.5 Counterparts . This Declaration may be executed in any number of counterparts each of which shall be an original but all of which shall constitute one and the same document. IN WITNESS WHEREOF, the undersigned have executed this Agreement was executed as of the date first written above. MAC MAGRUDER, Mac Magruder Chevrolet/Geo "Declarant" ATTEST: COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic ��W,- .� Assistant Secretary Chairman "Agency" ATTEST: CITY OF PALM SPRINGS, a municipal corporation Byc /-"'ice By: e Cilty/Clerk Mayor "City" APPROVED AS TO FORM: RUTAN & TUCKER N' iQRhwVVL/ DaVA�l J. Aleshire, Agency Counsel and City Attorney PAGE 12 OF 14 PAGES FS2\393\014061-O"\2135196.2 all/27195 STATE OF CALIFORNIA ) COUNTY OF On before me, &//V� !. Lz/FFjfjKirJr1 �li �l /P_, personally appeared - G. personally known to me -(ar-prayed-te-the-ors the basis af--satisfac- ,tary-evidence)--to be the person) whose name (ls) 2tYare ubscribed um and acknowledged to me that/she/they to the within inst�executed-_Llie same i> '-sj/her/their authorized capacity(4es) and that byChisxher/their signature (A) on the instrument the person(,pj or the entity upon behalf of which the person(S`) acted, executed the instrument. Witness my hand and official seal. E EL o � UfNOTARYPUBLIC-CALIFORNIATVtary INE L. WEDEKIND COMM.#7206984 � G� 1� Public [SEAL] RIVERSIDE COUNTY 0 COMM.EXP.FEES.3,2003 STATE OF CALIFORNIA ) ss. COUNTY OFC'rJl(% �° ) On efore,me, Acn/� Fr�� personally appeared`C�G.eZX .r„ L'i�J R/P,LZG_c��cr�c.� �.z-;C U_ (-'. •.�r/t L�f. personally known to me �-(or p-oved-to-me-on-the--basis,-o_f- satisfac- -to-ry-evidence)- to be the personQi)) whose name 64 is/q!�)subscri,b-e --, to the within instrument and acknowledged to me that he%heftheyl executed the sn his/hefZEheir)authorized capacit5Wies J, and that by his/he3 /their' signatur�lE on the instrument the personfi) or the entity upon behalf of which the person( acted, executed the instrument. Witness my hand and official seal. [SEAL] t a Nory Public s^ &+S.o F LHI NE WEDEKIND ,. COMM,.#1206984 (1 ,,rn•c ""L,h NOTARY PUBLIC-CALIFORNIA� RIVERSIDE COUNTY 0 n v COMM,EXP.FEB.3,2003 - PAGE 13 OF 14 PAGES PS2138310140840 MU155186.2 all@7195 212208 STATE OF CALIFORNIA ) ) SS . COUNTY OF ) On before me, personally appeared personally known to me (or proved to me on the basis of satisfac- tory evidence) to be the person(s) whose name (s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) , and that by his/her/their signature (s) on the instrument the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument. witness my hand and official seal . Notary Public [SEAL] PAGE 14 OF 14 PAGES FS2U83\0140U-000612155196.2 all/27/95 0 222208 EXHIBIT "1" LEGAL DESCRIPTION OF THE SITE The Easterly 470 feet of the South one-half of the Southeasterly one-quarter of the Southeasterly one-quarter of the Northeasterly one-quarter of Section 22, Township 4 South Range 4 East San Bernardino Base and Meridian, Riverside County, California, excepting the Southerly forty-four feet for street purposes and excepting that portion lying within the State Highway on the East, containing 3 . 0 acres, more or less. EXHIBIT TO DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS FS2\3631014084-0006\2155186.2 LLI/27/95 EXHIBIT "2" DEPICTION OF PUBLIC PARCEL —L1 L —TE=7 LLL251 IZ4 ------ . —IC A'-I R01 23 SEE SEE 2 O 2 Z6 27 MAP MA P v 28 z Q 27 2e OP' 5 SEE 5.v0 At± 23 ® M A P 29 18.r5Ac.rt JJb.0! _ 2 9 w o 2.55Ac.2' fh' � n LllAti• �, � 6060-50D "�3$.17- u..� "_.�, e17 W i £X llt li 1 4G' S✓NM A "oj PC P. 0 4.4Ae f V T 25.56Ac-t ,• £x. A.s Ar 4 / £X. J wl c V O / 2 O.JJAc.f 1is•S� u 1 i 4 Q4At f zr V 4.//At.Y 'o m �Fi�os2 EXHIBIT "2" TO DECLARATION OF COVENANTS, PS2\383\014094-0006\2155166.2 lui27i95 CONDITIONS AND RESTRICTIONS PA3 Mac Maruder Chevrolet/Geo OPA Exec Exh I - Unsec. Promissory Note AGREEMENT #366C R997_1-17-96__ UNSECURED PROMISSORY NOTE $200, 000 .00 199 Palm Springs, California FOR VALUE RECEIVED, the undersigned ("Maker") hereby promises to pay to the order of the COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, public body, corporate and politic ("Holder") , at a place designated by Holder, the principal sum of TWO HUNDRED THOUSAND DOLLARS ($200, 000 .00) or such lesser amount which shall from time to time be owing hereunder on account of unpaid advances made by Holder to or for the benefit of Maker. The principal sum hereof shall be disbursed pursuant to the terms and conditions set forth in that certain Owner Participation Agreement of even date herewith by and between Maker and Holder ( 11OPA" ) . Any capitalized terms not defined herein shall have the meanings ascribed to them in the OPA. 1. Repayment by Maker. Unless Maker shall have defaulted under the OPA, the Declaration, or breached any promise or obligation in this Note or in any other instrument now or hereafter securing the indebtedness evidenced hereby, (i) no interest shall accrue on the unpaid principal of this Note and (ii) a portion of the total principal advanced hereunder shall be forgiven on each anniversary date of the recordation of the Declaration in an amount equal to the total principal advanced hereunder divided by ten (10) . Any payments made by Maker in payment of this Note shall be applied first to the interest then accrued and due on the unpaid principal balance under this Note, and the remainder of each payment shall be applied to the reduction of the unpaid principal . 2 . Prepayment. This Note may be prepaid in whole or in part at any time without penalty. 4. Acceleration of Obligation. Upon the failure to make a payment that may become due under this Note (whether by extension, acceleration or otherwise) , or in the event of default under the OPA or the Declaration, or any breach of any other promise or obligation in this Note or in any other instrument now or hereafter securing the indebtedness evidenced hereby, then, and in any of such events, Holder may, at its option, declare this Note and the entire indebtedness hereby evidenced that has not been forgiven pursuant to Section 1 above to be immediately due and payable and collectible then or thereafter as Holder may elect, regardless of the date of maturity, and notice of the exercise of said option is hereby expressly waived by Maker. F52\383\014084-0006\2155186.2 .11/27/95 5 . Default Interest. If any event occurs giving Holder the right to accelerate this Note pursuant to Section 4 above, the entire unpaid and unforgiven principal owing hereunder shall commence to accrue interest at a rate equal to three percentage points above the Reference Rate published by Bank of America N.A. , or the maximum non-usurious interest rate permitted by law, whichever is less. 6. Collection Costs, Attorneys' Fees. If any attorney is engaged by Holder because of any event of default under this Note or to enforce of defend any provision of either instrument, whether or not suit is filed hereon, then Maker shall pay upon demand reasonable attorneys' fees and all costs so incurred by Holder together with interest thereon until paid at the applicable rate of interest payable hereunder, as if such fees and costs had been added to the principal owing hereunder. 7. Waivers by Maker. Maker and all endorsers, guarantors and persons liable or to become liable on this Not waive presentment, protest and demand, notice of protest, demand and dishonor and nonpayment of this Note and any and all other notices or matters of a like nature, and consent to any and all renewals and extensions near the time of payment hereof and agree further that at any time and from time to time without notice, the terms of payment herein may be modified or the security described in any documents securing this Note released in whole or in part, or increased, changed or exchanged by agreement between Holder and any owner of the premises affected by said documents securing this Note, without in any way affecting the liability of any party to this Note or any persons liable or to become liable with respect to any 'indebtedness evidenced hereby. 9 . Severability. The unenforceability or invalidity of any provision or provisions of this Note as to any persons or circumstances shall not render that provision or those provisions unenforceable or invalid as to any other provisions or circum- stances, and all provisions hereof, in all other respects, shall remain valid and enforceable. 10 . Modifications. Neither this Note nor any term hereof may be waived, amended, discharged, modified, changed or terminated orally; nor shall any waiver of any provision hereof be effective except by an instrument in writing signed by Maker and Holder. No delay or omission on the part of Holder in exercising any right hereunder shall operate as a waiver of such right or of any other right under this Note. 11. No Waiver by Holder. No waiver of any breach, default or failure of condition under the terms of this Note shall be implied from any failure of the Holder of this Note to take, or any delay be implied from any failure by the Holder in taking action with F5213831014084000612155186.2 al IJ27195 0 respect to such breach, default or failure from any prior waiver of any similar or unrelated breach, default or failure. 12 . Usk. Notwithstanding any provision in this Note, the total liability for payment in the nature of interest shall not exceed the limit now imposed by applicable laws of the State of California. 13 . Governing Law. This Note has been' executed and delivered by Maker in the State of California . and is to be governed and construed in accordance with the laws thereof. IN WITNESS WHEREOF, Maker has executed this Note as of the date and year first above written. �� j /G • Cam, �%�� �jjti /��/ �/lP,GJ MAC MAGRUDER, Awa Mac Magruder Chevrolet/Geo "Maker" FS2\383\014094-0006\2155186.2 all/27/95 CERTIFICATE OF INSURANCE „`-` ' - UU3308 (9-82) UNIVERSAL UNDERWRITERS INSURANCE COMPANY 6363 College Boulevard--Overland Park, Kansas 66211 WECE!VE L hereby certifies that the following insurance policies have been issued on behalf of: r U L tf is 1999 Name of Insured Mac Magruder Chevrolet, Inc. Address of Insured 999 S. Palm Canyon Dr., Palm Springs, CA 92264 KIND OF INSURANCE POLICY NUMBER POLICY PERIOD OUR LIMITS Building 168690A 08-01-98/99 $887,000 $500 Deductibles: Fire, W-H, V&MM, Other Spec. Perils, Theft-Burglary, Unnamed Perils, &Breakdown Replacement Cost Garage Operations and Auto Hazard 168690A 08-01-98/99 $300,000 including General Liability Umbrella 168690A 08-01-98/99 $5,000,000 City of Palm Springs, their offficers, employees and agents are named as Additional Insured on the above coverages. This Certificate of Insurance neither affirmatively nor negatively amends, extends or alters the coverage afforded by the policies listed above which have been issued by this Company. In the event of any material change in, or cancellation of, said policies, the undersigned company will give 30 days written notice to the party to whom this certificate is issued. Certificate of insurance prepared for: Name City of Palm Springs Address 3200 Tahquitz Carryon Way Palm Springs, CA 92262 This certificate is not valid unless countersigned by an authorized representative of tfi company., 7, , Date 06-30-98 Countersigned by at Costa Mesa, CA Authorized Representative