Sales Tax Taco Bell Agreement- 2021-25 aoat- XS
SALES TAX SHARING AGREEMENT
ARTICLE I PARTIES AND EFFECTIVE DATE.
1.1 Parties. This Sales Tax Sharing Agreement("Agreement") is entered into
on this 23`d day of February 2021 ("Effective Date") by and between the CITY OF
GRAND TERRACE, a California municipal corporation ("City"), and SERJ TACO
CALIFORNIA, LLC, a California limited liability company (the "Business"). City and
Business are sometimes referred to individually as a "Party" and together as "Parties"
herein.
1.2 Effective Date. This Agreement will not become effective until the date
on which both of the following are true: (i) this Agreement has been approved by the City
Council following all legally required notices and hearings; and (ii) this Agreement has
been executed by the appropriate authorities of City and Business.
ARTICLE II RECITALS.
2.1 Business is a fast food restaurant Taco Bell franchisee and is considering
establishing a new Restaurant Facility on the Property in the City of Grand Terrace, sales
from which are expected to generate significant sales tax revenues for the City.
2.2 To facilitate Business's ability to construct and operate a new Restaurant
Facility at the Property, the City has agreed to waive $35,000 of building permit fees and
has also agreed to provide Business financial assistance by making payments to Business
of sales tax revenues paid by Business and collected by City from the California
Department of Tax and Fee Administration, in an amount of$8,300 per year for five (5)
years for a maximum total of$41,500, or until Business's sales exceed $1.6 million per
year, whichever occurs first.
2.3 The incentives provided in this Agreement are intended for the purpose of
facilitating Business's establishment and operation of a Restaurant Facility at the Property,
and help ensure that such facility remains at the Property for not less than five (5) years.
2.4 Entering into this Agreement will provide significant public benefits to the
City by encouraging Business to operate in the City for at least the minimum term of this
Agreement, thereby generating substantial sales and property tax revenue for the City,
creating new employment opportunities for 35 persons, and generally creating social and
economic benefits locally. The City has also determined that its entry into this Agreement
serves a significant public purpose while providing only incidental benefits to a private
party.
2.5 This Agreement has been reviewed with respect to applicability of the
California Environmental Quality Act ("CEQA"), the State CEQA Guidelines (California
Code of Regulations, Title 14, §§ 15000 et seq., hereafter the "Guidelines"), and the
environmental guidelines of the respective parties. This Agreement is not a "project" for
purposes of CEQA, as that term is defined by Guidelines §15378,because this Agreement
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is a government funding mechanism or other government fiscal activity, which does not
involve any commitment to any specific project which may result in potentially significant
physical impact on the environment, per §15378(b)(4) of the Guidelines, or alternatively,
an organizational or administrative activity 'that will not result in a direct or indirect
physical change in the environment.
2.6 City, in consideration of the additional Local Sales Tax Revenues (as
defined in Section 3.1.14) to be collected and remitted by Business for the benefit of City,
which City would not otherwise realize, desires to provide City Payments to Business as
compensation for Business establishing Operations at the Property through a Restaurant
Facility, and otherwise satisfying its obligations under this Agreement.
2.7 Such City Payment will be made on an annual basis from Local Sales Tax
Revenues actually received by City.
2.8 City and Business desire to enter into this Agreement for the purposes
described above.
ARTICLE III DEFINITIONS.
3.1 Definitions. Unless the,context otherwise requires,the terms defined in this
Article III shall, for all purposes, and of any amendment hereof, and of any opinion or
report or other document mentioned herein or therein, have the meapings defined herein;
the following definitions to be equally applicable to both the singular and plural forms of
any of the terms defined herein.
3.1.1. "Agreement" shall have the meaning set forth in Section 1.1.
3.1.2 "Business Day" means a day which is not a Saturday, Sunday or
legal holiday on which banking institutions in the State of California or City are closed.
3.1.3 "CDTFA" means the California Department of Tax and Fee
Administration and any successor agency. .
3.1.4 "City" shall have the meaning set forth in Section 1.1 and shall
include any nominee, assignee or successor to City's rights,powers and responsibilities.
3.1.5 "City Payment"means a payment in the amount of Eight Thousand
Three Hundred Dollars ($8,300), or a portion thereof where this Agreement is
automatically terminated-pursuant to Section 4.7.1 in which event the City Payment will
be pro-rated based on a 365-day calendar year, paid by City to Business from the Local
Sales Tax Revenues received by City in accordance with Section 4.2.
3.1.6 "Data and Documentation" shall have the meaning set forth in
Section 4.2.2.
3.1.7 "Dispute Notice" shall have the meaning set forth in Section 6.16.
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3.1.8 "Effective Date" shall have the meaning set forth in Section 1.1.
3.1.9 "Event of Default" shall have the meaning set forth in Section 4.5.
3.1.10 "Financial Assistance" shall have the meaning set forth in Section
4.1.
3.1.11 "First City Payment Date" shall have the meaning set forth in
Section 4.2.
3.1.12 "First Restaurant Sales Transaction Date" means the date
Business enters into its first Restaurant Sales transaction.
3.1.13 "Fiscal Quarter" means each of the four (4) three-month periods
within the Term and commencing on January 1, April 1, July 1, or October 1.
3.1.14 "Local Sales Tax Revenues" means that portion of the Sales Tax,
paid by Business, which is allocated and paid to City pursuant to the Sales Tax Law. Local
Sales Tax Revenues shall not include: (i) Penalty Assessments, (ii) any Sales Tax levied
by, collected for or allocated to the State of California, the County of San Bernardino, or a
district or any entity(including an allocation to a statewide or countywide pool) other than
City, (iii) any administrative fee charged by the CDTFA, (iv) any Sales Tax subject to any
sharing, rebate, offset or other charge imposed pursuant to any applicable provision of
,federal, state or local law,rule or regulation; or(v) any gales Tax(or other funds measured
by Sales Tax) required by the State of California to be paid over to another public entity
(including the State)or set aside and/or pledged to a specific use other than for deposit into
or payment from the City's general fund.
3.1.15 "Minor Amendment" means any, limited technical correction, or
not-substantive modification of this Agreement, as determined by the City Manager and
City Attorney.
3.1.16 "Operations" means Restaurant Sales consummated through the
Restaurant Facility to be operated by Business following the Effective Date of this
Agreement.
3.1.17 "Penalty Assessments" means penalties, assessments, collection
costs and other costs, fees or charges resulting from late or delinquent payment of Sales
Tax and which.are levied, assessed or otherwise collected from Business.
3.1.18 "Property" means the 0.56 acre real property having Assessor's
Parcel Number 0275-242-1.3-0000, located at 22172 Barton Road, City of Grand Terrace,
California upon which it is anticipated that Business will operate the Restaurant Facility.
3.1.19 "Resolution Period" shall have the meaning set forth in Section
6.16.
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3.1.20 "Restaurant Facility" means the Business's facility located upon
the Property and to be operated by Business following the Effective Date at which
Restaurant Sales transactions are consummated pursuant to the Sales Tax Law.
3.1.21 "Restaurant Sales" means all sales of food, beverage and other
items to any person or entity, which is subject to the Sales Tax Law and which generates
Local Sales Tax Revenues.
3.1.22 "Sales Tax"means all sales and use taxes levied under the authority
of the Sales Tax Law, excluding Sales Tax which is to be refunded to Business,because of
an overpayment of Sales Tax.
3.1.23 "Sales Tax Law" means (i) California Revenue and Taxation Code
Section 6001 et seq., and any successor law thereto, (ii) any legislation allowing City or
other public agency with jurisdiction in City to levy any form of Sales Tax, and (iii)
regulations of the CDTFA and other binding rulings and interpretations relating to (i) and
(ii) hereof.
3.1.24 "Term" shall mean that period commencing on the Effective Date
and ending upon the date City makes the last of the five (5) annual City Payments to
Business commencing on the First City Payment Date and continuing thereafter on an
annual basis (that is, after a total of$41,500 is paid to Business) unless Business's sales
should exceed $1.6 million (i) during t e twelve-month period following the First
Restaurant Sales Transaction Date or (ii) any of the successive twelve-month periods
following the first anniversary of the First Restaurant Sales Transaction Date, in which
event this Agreement shall automatically terminate effective at the end of such annual
period.
ARTICLE IV OPERATION
4.1 Operation Covenant. Business hereby represents,warrants and covenants
that it shall conduct any Restaurant Sales operations through the Restaurant Facility in
accordance with this Agreement, the Sales Tax Law, and all other applicable provisions of
local, state and federal law. Business will not directly or indirectly solicit or accept any
"Financial Assistance" from any other public or private person or entity, if such Financial
Assistance is given for the purpose of causing or would result in Business's breach of the
covenants set forth in this Section 4.1. For purposes of this Section 4.1 the term"Financial
Assistance" means any direct or indirect payment, subsidy, rebate, or other similar or
dissimilar monetary or non-monetary benefit, including, without implied limitation,
payment of land subsidies, relocation expenses, public financings, property or sales tax
relief, rebates, exemptions or credits, relief from public improvement obligations, and
payment for public improvements to or for the benefit of Business.
4.2 Payment of City Payment. Within one hundred twenty (120) calendar
days following the one-year anniversary of the Effective Date ("First City Payment
Date") and on each anniversary of the First City Payment Date, and provided City has
received: (i) final reconciliation reports from the CDTFA for the time period for which
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Local Sales Tax Revenues were paid by Business, and (ii) all Data and Documentation
applicable to such time period, City will determine and pay to Business five (5) City
Payments for a maximum total of Forty One Thousand Five Hundred Dollars ($41,500) or
until Business's sales revenues exceed $1.6 million per year, whichever occurs first. To
determine whether Business's sales revenues exceed $1,6 million per year, sales shall be
calculated (i) during the twelve-month period following the First Restaurant Sales
Transaction Date or (ii) any of the successive twelve-month periods following the first
anniversary of the First Restaurant Sales Transaction Date. City Payments shall be paid on
an annual basis notwithstanding that calculations of the same based on final reconciliation
reports from the CDTFA and Data and Documentation shall be made on a Fiscal Quarter
basis. In the event Business' sales should exceed$1.6 million per year and this Agreement
should automatically terminate pursuant to Section 4.7.1, to the extent City Payments are
still owed, City shall remain obligated to pay Business even after the date of Agreement
termination.
4.2.1 Conditions Precedent to City Payments. City's obligations to
make any City Payments to Business hereunder are expressly contingent upon the
satisfaction of the following conditions precedent in each Fiscal Quarter after Business has
begun Restaurant Sales from the Property:
(i) Business having, for the entirety of such Fiscal Quarter or
portion thereof, as applicable, completely fulfilled its
1�aterial obligations under this Agreement;
(ii) City's receipt and reasonable approval of the Data and
Documentation, certified as complete and accurate by an
authorized Business officer or an authorized signatory
delegate; and
(iii) City possessing sufficient Local Sales Tax Revenues to
make a City Payment to Business.
Should any one or more of the foregoing conditions precedent not be satisfied for
each Fiscal Quarter or portion thereof, as applicable, then City shall have no obligation to
make any City Payment to Business until such condition(s) precedent are met. If the City
elects to delay any payment on account of any such purported noncompliance by Business,
the City must promptly give Business written notice pursuant to Section 6.8 of all such
material obligations that the City alleges have not been fulfilled and cooperate with
Business's efforts to effect a cure or remedy with respect thereto.
4.2.2 Data and Documentation. For the purposes of this Agreement,
the term "Data and Documentation"means copies of Business's quarterly reports to the
CDTFA for the applicable Fiscal Quarter which sets forth the amount of Sales Taxes paid
to the CDTFA during the Fiscal Quarter arising from Business's Operations.
4.2.3 Adequate Consideration. Each City Payment due and payable
hereunder shall constitute the total payment to Business for the time period to which it
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relates. The Parties hereto have determined and agreed that the City Payment due and
payable under this Agreement represents fair consideration to Business for its covenants
and obligations hereunder. Business shall not be entitled to any reimbursement or other
compensation from City for any costs incurred by Business in performing or preparing to
perform its obligations under this Agreement. The City Payments shall not be reduced or -
offset for any costs or expenses incurred by City in performing or preparing to perform its
duties under this Agreement.
4.2.4 No Carry Forward or Back. City and Business acknowledge and
agree that the calculation and determination of all financial components of the Parties'
rights and obligations under this Agreement shall be computed on a Fiscal
Quarter-to-Fiscal Quarter basis. Revenues generated in one Fiscal Quarter may not be
carried forward or back to any prior or future Fiscal Quarter,it being the express agreement
and understanding of the Parties that for each Fiscal Quarter the financial obligations of
the Parties and satisfaction of the conditions precedent to such obligations shall be
determined and made independently of any other Fiscal Quarter.
4.2.5 Source of City Payment. City Payments shall be payable only from
the Local Sales Tax Revenues received by City. City covenants to reasonably consider
such actions as may be necessary to include all City Payments owed hereunder in each of
its annual budgets during the Term and to reasonably consider the necessary annual
budgetary appropriations for all such City Payments.
4.2.6 Recapture of City Payments. If, at any time dun ng or after the
Term of this Agreement, CDTFA makes a final Board determination that all or any portion
of the Local Sales Tax Revenues received by the City were improperly allocated and/or
paid to the City, and if CDTFA requires repayment of, offsets against future Sales Tax
payments, or otherwise recaptures from the City those improperly allocated and/or paid
Local Sales Tax Revenues,then Business shall,within thirty(30)days after written demand
from the City, together with reasonable documentation, repay all City Payments (or
applicable portions thereof) theretofore paid to Business which are, attributable to such
repaid, offset or recaptured Local Sales Tax Revenues. If Business fails to make such
repayment within thirty(30)days after the City's written demand,together with reasonable
documentation, then such obligation shall accrue interest from the date of the City's
original written demand at the then-maximum legal rate imposed by the California Code
of Civil Procedure on prejudgment monetary obligations, compounded monthly,until paid.
In addition, to the extent unpaid, City may withhold such amounts from future City
Payments.The City will promptly contact Business regarding any communication from the
CDTFA pertaining to tax allocations associated with Business's business.
4.3 Audit of Books and Records. Either Party shall make its books and
records relating to the rights and obligations under this Agreement available at no cost to
the requesting Party and/or its designees (including its accountants and/or attorneys) and
shall direct its accountants and other consultants and contractors in possession of its books
and records to do likewise; provided, however, that nothing herein shall be deemed to
abridge or constitute a waiver of any Party's evidentiary rights and privileges arising
pursuant to any provision of law, including, without implied limitation, the California
01247.0002/670104.1 6
Evidence Code, California Government Code(including the Public Records Act),the Code
of Civil Procedure, federal statutes and state or federal judicial decisions. Furthermore,
Business may redact or omit confidential information,including but not limited to customer
information such as addresses, names and phone numbers. Furthermore, all such non-
privileged books and records may be made available and introduced as evidence if ordered
by any court of competent jurisdiction. Each Party shall bear the costs of its own auditors,
experts and other consultants it may engage to complete its investigation of the other Party's
books and records; provided, however, that any audit and/or investigation ordered by the
court,may be recovered as an item of litigation expense pursuant to Section 6.13.
4.4 Employment Outreach for Local Residents. A goal of the City in
entering into this Agreement is to foster employment opportunities for City residents. To
that end, Business shall use commercially reasonable efforts to recruit and hire local
residents for full and part time employment opportunities at its Restaurant Facility, as
determined by Business in its sole discretion. Any offers of employment shall be at
Business's sole discretion., Nothing in this paragraph shall require Business to offer
employment to individuals who are not otherwise qualified for such employment. Without
limiting the generality of the foregoing, the provisions of this Section 4.4 are not intended,
and shall not be construed, to benefit or be enforceable by any person whatsoever other
than City.
4.5 Event of Default. Each of the following shall constitute an "Event of
Defa�lt":
4.5.1 Failure by a Party to comply with and observe any of the conditions,
terms, or covenants set forth in this Agreement, if such failure remains uncured within
thirty (30) days after written notice of such failure from the non-defaulting Party to the
defaulting Party in the manner provided herein or, with respect to a default that cannot be
cured within thirty (30) days, if the defaulting Party fails to commence such cure within
such thirty (30) day period or thereafter fails to diligently and continuously proceed with
such cure to completion. However, if a different period,.notice requirement, or remedy is
specified under any other section of this Agreement, then the specific provision shall
control.
4.5.2 Any representation or warranty contained in this Agreement or in
any application, financial statement, invoice, certificate, or report submitted pursuant to
this Agreement proves to have been incorrect in any material respect when made.
4.6 Rights and Remedies; Rights and Remedies Not Exclusive. Unless
prohibited by law or otherwise provided by a specific term of this Agreement, the rights
and remedies of City and Business under this Agreement are non-exclusive and all
remedies hereunder may be exercised individually or cumulatively. Upon the other Party's
Event of Default, in addition to those remedies expressly granted herein, the Parties shall r
also have the right to seek all other available legal and equitable remedies.
01247.0002/670104.1 7
4.7 Term and Termination.
4.7.1 As defined in Section 3.1.24, the Term of this Agreement shall be
the period commencing on the Effective Date and ending upon the date City makes the last
of the five (5) annual City Payments to Business commencing on the First City Payment
Date and continuing thereafter on an annual basis (that is, after a total of$41,500 is paid to
Business) unless Business's sales should exceed $1.6 million (i) during the twelve-month
period following the First Restaurant Sales Transaction Date or (ii) any of the successive
twelve-month periods following the first anniversary of the First Restaurant Sales
Transaction Date, in which event this Agreement shall automatically terminate effective at
the end of such annual period, it being understood that such sales amount may not become
known to the Parties until after the period ends.
4.7.2 In the event Business's lease agreement for the Property where the
Restaurant Facility is located expires or terminates or the operations of the Restaurant
Facility should terminate, Business may, at its option, terminate this Agreement upon
written notice to the City.
4.7.3 In addition to all other rights and remedies granted to the Parties
under this Agreement or available to them in equity or at law, either Party may terminate
this Agreement and all of its obligations hereunder without cost or liability upon the other
Party's Event of Default. Such termination shall not limit or abridge the rights and remedies
available to the non-defaulting Party.
4.7.4 City may terminate this Agreement in the event Business does not
get a Certificate of Occupancy issued for the Restaurant Facility within one year of the
Effective Date.
ARTICLE V REPRESENTATIONS AND WARRANTIES
5.1 City Representations and Warranties. City represents and warrants to
Business that, to City's actual current knowledge:
(i) City is a municipal corporation exercising governmental
functions and powers and organized and existing under the
State of California;
(ii) City has taken all actions required by law to approve the
execution of this Agreement;
(iii) City's entry into this Agreement and the performance of
City's obligations under this Agreement do not violate any
contract, agreement or other legal obligation of City;
(iv) There are no pending lawsuits or other actions or
proceedings which would prevent or impair the timely
performance of City's obligations under this Agreement;
01247.0002/670104.1 8
(v) City has the legal right,power and authority to enter into this
Agreement and to consummate the transactions
contemplated hereby, and the execution, delivery and
performance of this Agreement has been duly authorized and
no other action by City is requisite to the valid and binding
execution, delivery and performance of this Agreement,
except as otherwise expressly set forth herein; and
(vi) The individual executing this Agreement is authorized to
execute this Agreement on behalf of City.
The representations and warranties set forth above are material
consideration to Business and City acknowledges that Business is relying upon the
representations set forth above in undertaking' Business's obligations set forth in this
Agreement.
The term "actual current knowledge" as respecting City means, and is
limited to, the actual current knowledge of City Manager, as of the Effective Date,without
having undertaken any independent inquiry or investigation for the purpose of making such
representation or warranty. All of the terms, covenants and conditions of this Agreement
shall be binding on and shall inure to the benefit of City and its nominees, successors and
assigns.
5.2 Business Representations and Warranties. Business represents and l
warrants to City that, to Business's actual current knowledge:
(i) Business is a 'duly formed California limited liability
company and is in good standing and qualified to do business
under the laws of the State of California;
(ii) The individual(s)executing this Agreement is/are authorized
to execute this Agreement on behalf of Business;
(iii) Business has taken all actions required by law to approve this
Agreement;
(iv) Business's entry into this Agreement and the performance of
Business's obligations under this Agreement do not violate
any contract, agreement or other legal obligation of
Business;
(v) There are no pending lawsuits or other actions or
proceedings which would prevent or impair the timely
performance of Business's obligations under this
Agreement; and
(vi) Business has the legal right,power and authority to enter into
this Agreement and to consummate the transactions
01247.0002/670104.1 9
contemplated hereby, and the execution, delivery and
performance of this Agreement have been duly authorized
and no,other action by Business is requisite to the valid and
binding execution, delivery and performance of this
Agreement, except as otherwise expressly set forth herein.
The representations and warranties set forth herein are material
considerations to City and Business acknowledges that City is relying upon the
representations set forth above in undertaking City's obligations set forth above.
The term "actual current knowledge" as respecting Business means, and is
limited to, the actual current knowledge of the individual(s) executing this Agreement on
behalf of Business as of the Effective Date.
5.3 The City has entered into this Agreement with Business because of the
unique qualifications and identity of Business. No voluntary or involuntary successor-in-
interest of Business shall acquire any rights or powers under this Agreement except as
expressly set forth herein.
ARTICLE VI MISCELLANEOUS
6.1 Amendment;Modification. At any time City and Business may determine
that this Agreement should be amended for the mutual benefit of the Parties, or for any
other reason. Any such amendment to this Agreement shall only be by written lagreement
between City and Business. City and Business agree to consider reasonable requests for
amendments to this Agreement which may be made by either of the Parties hereto,although
neither Party shall be obligated to approve any such amendment. Any amendments to this
Agreement must be in writing and signed by the appropriate authorities of both City and
Business. With the concurrence of the City Attorney, the City Manager is authorized on
behalf of City to approve and execute Minor Amendments to this Agreement (as defined
in Section 3.1.15) on behalf of City. Any amendment that is not a Minor Amendment shall
require approval by the City Council. Any such approved amendment shall control over
this Agreement.
6.2 California Law. This Agreement shall be construed and governed in
accordance with the laws of the State of California without regard to its conflict of laws
principles.
6.3 Execution in Counterparts. This Agreement may be executed in two (2)
or more counterparts, each of which shall be deemed an original, and all of which shall
constitute but one(1) and the same instrument.
6.4 Business Days. Any act or thing required to be done or exist on any date
set forth herein which does not constitute a Business Day in any year shall be deemed to
be done or to exist on such date if such act or thing is done or exists on the next date which
constitutes a Business Day.
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6.5 Tax Consequences. Business shall be responsible and assume all liability
for federal, state and/or local income or other taxes resulting from its receipt of City
Payments.
6.6 Rights Not Granted. This Agreement is not, and shall not be construed to
be, a statutory development agreement under California Government Code Section 65864
et seq. or a disposition and development agreement under California Health and Safety
Code Section 33000 et seq. This Agreement is not, and shall not be construed to be, an
approval of or an agreement to issue permits or a granting of any right or entitlement by
City concerning any project, development, or construction by Business in City. This
Agreement does not, and shall not be construed to exempt Business in any way from the
requirement to obtain permits and/or other discretionary or non-discretionary approvals as
may be necessary for the development, maintenance and operation of any project,
development or construction within City.
This Agreement does not, and shall not be construed to exempt Business from the
application and/or exercise of City's power of eminent domain or its police power,
including, but not limited to, the regulation of land uses and the taking of any actions
necessary to protect the health, safety and welfare of its citizenry.
6.7 Consent. Whenever consent or approval of either Party is required under
this Agreement,that Party shall not unreasonably withhold,delay or condition such consent
or approval unless a different standard is otherwise provided by a specific provision of this
Agreement. '
6.8 Notices and Demands. All notices or other communications required or
permitted between City and Business under this Agreement shall be in writing, and may be
(i) personally delivered, (ii) sent by United States registered or certified mail, postage
prepaid, return receipt requested, or (iii) sent by nationally recognized overnight courier
service(e.g., Federal Express), and addressed to the Parties at the addresses below subject
to the right of either Party to designate a different address for itself by notice similarly
given. Any notice so given by registered or certified United States mail shall be deemed
to have been received on the fourth (4th) Business Day after the same is deposited in the
United States mail. Any notice not so given by registered or certified mail, such as notices
delivered by courier service (e.g., Federal Express), shall be deemed received upon actual
receipt of the same by the Party to whom the notice is given.
To City: City of Grand Terrace
Attention: City Manager
22795 Barton goad
Grand Terrace, CA 92313
With a copy to: Aleshire&Wynder, LLP
Attention: Adrian Guerra, City Attorney
18881 Von Karman Ave., Suite 1700
Irvine, CA 92612
01247.0002/670104.1 11
To Business: SERJ Taco California, LLC
Attention: Jasmin Patel
1500 East Katella Avenue, Suite 5
Orange, CA 92867
6.9 Non-liability of City Officials and Employees. No officer, elected
official, contractor, consultant, attorney or employee of City shall be personally liable to
Business, any voluntary or involuntary successors or assignees of Business, or any lender
or other party holding an interest in Business's property, in the event of any default or
breach by City, or for any amount which may become due to Business or to its successors
or assigns, or on any obligations arising under this Agreement.
6.10 Conflicts of Interest. No officer, elected official, contractor, consultant,
attorney or employee of City shall have any personal interest, direct or indirect, in this
Agreement nor shall any such officer, elected official, contractor, consultant, attorney or
employee participate in any decision relating to this Agreement which unlawfully affects
his/her personal interests or the interests of any corporation, partnership or association in
which he/she is directly or indirectly interested.
6.11 Entire Agreement; Confidentiality. This Agreement contains all of the
terms and conditions agreed upon by the Parties. No other understanding, oral or
otherwise, in direct conflict with this Agreement shall be deemed to exist or to bind any of
the Parties hereto. All prior written or oral offors, counteroffers, memoranda of
understanding, proposals and the like are superseded by this Agreement. The terms and
existence of this Agreement will not be publicized or made public beyond what is required
by law. City shall keep any and all proprietary and confidential information and data
provided by Business under this Agreement strictly confidential to the extent permitted by
law. City will use information provided by Business pursuant to this Agreement only for
the purposes within the scope of this Agreement. Business shall clearly mark or otherwise
identify in writing all information it considers to be proprietary and confidential at the time
it is delivered to City. The confidentiality obligation under this section shall not apply to:
(a) information which is already public information or which is otherwise available to the
general public; (b)information received from a third party without a similar confidentiality
restriction who is lawfully in possession of the information and who has the lawful right to
disclose it; (c) information that is already in City's possession prior to receiving it from
Business; (d) information delivered by Business to City and not marked or otherwise
identified as proprietary and confidential at the time it was delivered; or (e) information
required to be disclosed under the California Public Records Act.
6.12 Force Majeure. Time is of the essence in the performance of the
obligations of City and Business under this Agreement. The time period(s) specified for
performance pursuant to this Agreement shall be extended because of any delays due to
unforeseeable causes beyond the control and without the fault or negligence of the delayed
Party, including,but not restricted to, acts of God or of the public enemy,unusually severe
weather, fires, earthquakes,floods, epidemics, quarantine restrictions,riots, strikes, freight
embargoes,wars, litigation, and/or acts of any governmental agency, including the City, if
the Party seeking to claim force majeure protection shall within ten (10) days of the
01247.0002/670104.1 12
commencement of such delay notify the other Party in writing of the causes of the delay.
The Party not seeking force majeure protection shall ascertain the facts and the extent of
delay, and extend the time for performance for the period, of the delay when and if in the
judgment of such Party such delay is justified. Such determination shall be final and
conclusive upon the Parties to this Agreement.
6.13 Indemnification. Business agrees to indemnify and defend City and hold
it harmless from and against all third party demands, suits, proceedings, causes of action
or claims arising from, in connection with or related to this Agreement or from City's
performance of this Agreement, except to the extent such demand, suit,proceeding, cause
of action or claim was caused by City's negligence or intentional misconduct, or the
negligence or intentional misconduct of any of the City's officials, officers, employees, or
agents. The City shall fully cooperate in the defense of such demand, suit, proceeding,
cause of action or claim and upon written request of Business shall provide to Business
such documents and records in possession of the City that are relevant to such demand,
suit,proceeding or claim and not otherwise protected by law.
6.14 Payment of Prevailing Wages. Business acknowledges that the City has
made no representation, express or implied, to Business or any person associated with the
Business regarding whether or not laborers employed relative to the construction and
installation of the Restaurant Facility, if any, must be paid the prevailing per diem wage
rate for their labor classification, as determined by the State of California, pursuant to
Labor Code Sections 1720, et seq.("Prevailing Wage Law"). Business agrees with the City
that Business shall assume the responsibility and be solely responsible for determining
whether or not laborers employed relative to any construction pertaining to the Restaurant
Facility must be paid the prevailing per diem wage rate for their labor classification, as
determined by the State of California, pursuant to Labor Code Sections 1720, et seq. To
this end, Business acknowledges and agrees that should any third party, including but not
limited to the Director of the Department of Industrial Relations ("DIR"),require Business
or any of its contractors or subcontractors to pay the general prevailing wage rates of per
diem wages and overtime and holiday wages determined by the Director of the DIR under
Prevailing Wage Law,then Business shall(with counsel acceptable to the City)indemnify,
defend, and hold City harmless from any such determinations, or actions (whether legal,
equitable, or administrative in nature), liabilities, damages,penalties or other proceedings,
and shall assume all obligations and liabilities for the payment of such wages and for
compliance with the provisions of the Prevailing Wage Law. Business covenants and
agrees that Business shall assume the responsibility and be solely responsible for
determining whether or not laborers employed relative to any construction pertaining to
the construction of the Restaurant Facility must be paid the prevailing per diem wage rate
for their labor classification, as determined by the State of California, pursuant to the
Prevailing Wage Law.
6.15 Attorneys' Fees. In the event of the-bringing of an action or suit.by a Party
hereto against another Party hereunder by reason of any breach of any of the covenants or
agreements or any intentional inaccuracies in any of the representations and warranties on
the part of the other Party arising out of this Agreement or any other dispute between the
Parties concerning this Agreement then, in that event, the prevailing Party in such action
01247.0002/670104.1 13
or dispute,whether by final judgment or arbitration award, shall be entitled to recover from
the other Party all costs and expenses of suit or claim, including actual attorneys' fees and
expert witness fees. Any judgment, order or award entered in any final judgment or award
shall contain a specific provision providing for the recovery of all costs and expenses of
suit or claim, including actual attorneys' fees and expert witness fees (collectively,
"Costs") incurred in enforcing,perfecting and executing such judgment or award. For the
purposes of this Section 6.15, Costs shall include, without implied limitation, attorneys'
and experts' fees, costs and expenses incurred in the following: (i)post judgment motions
and appeals, (ii) contempt proceedings, (iii) garnishment, levy and debtor and third party
examination; (iv) discovery; and (v)bankruptcy litigation. This Section 6.15 shall survive
any expiration or sooner termination of this Agreement.
6.16 Informal Dispute Resolution. The Parties shall attempt in good faith to
resolve any differences, controversy or claim arising out of or relating to this Agreement
promptly by negotiations between senior officials of the Parties who have authority to settle
the difference or controversy. The disputing Party may give the other Party written notice
("Dispute Notice") that a dispute exists.between them. Within twenty (20) days after
receipt of a Dispute Notice,the receiving Party shall submit to the disputing Party a written
response. The Dispute Notice and response shall include (a) a statement of each Party's
position and a summary of the evidence and arguments supporting its position, and (b)the
name and title of the official who shall represent that Party. The senior officials shall meet
at a mutually acceptable time and place or by telephone conference within thirty(30) days
of the date of the Dispute Notice, and thereafter as often as they reasonably deem necessary
to exchange relevant information and to attempt to resolve the dispute, up to a maximum
of ninety (90) days of the date of the Dispute Notice ("Resolution Period"). In the event
any Party fails to provide a response to a Dispute Notice in accordance with this section or
fails to cooperate in the scheduling of, or to attend, the meetings, described above, to
resolve the dispute, then, with respect to that Party, the Resolution Period shall be deemed
to have run so that the dispute may immediately be subject to legal action.
6.17 Jurisdiction and Venue. Any legal action or proceeding concerning this
Agreement shall be filed and prosecuted in the appropriate State of California court in the
County of San Bernardino, California. Both Parties hereto irrevocably consent to the
personal jurisdiction of that court. City and Business each hereby expressly waive the
benefit of any provision of federal or state law or judicial.decision providing for the filing,
removal, or change of venue to any other court or jurisdiction, including, without implied
limitation, federal district court, due to any diversity of citizenship between City and
Business, due to the fact that City is a party to such action or proceeding or due to the fact
that a federal question or federal right is involved or alleged to be involved. Business
acknowledges that the provisions of this Section 6.17 are material consideration to City for
its entry into this Agreement, in that City will avoid the potential cost, expense and
inconvenience of litigating in a distant forum.
6.18 Interpretation. City and Business acknowledge that this Agreement is the
product of mutual arms-length negotiation and drafting and that both Parties have been
represented by legal counsel in the negotiation and drafting of this Agreement.
Accordingly, the rule of construction which provides that ambiguities in a document shall
01247.0002/670104.1 14
be construed against the drafter of that document shall have no application to the
interpretation and enforcement of this Agreement. In any action or proceeding to interpret
or enforce this Agreement, the finder of fact may refer to any extrinsic evidence not in
direct conflict with any specific provision of this Agreement to determine and give effect
to the intention of the Parties with respect to any ambiguities in this Agreement.
6.19 No Waiver. Failure to insist on any occasion upon strict compliance with
any of the terms, covenants or conditions hereof shall not be deemed a waiver by any Party
of such term, covenant or condition, nor shall any waiver or relinquishment of any rights
or powers hereunder at any one time or more times be deemed a waiver or relinquishment
by any Party of such other right or power at any other time or times.
6.20 Successors and Assigns. The terms, covenants and conditions of this
Agreement shall be binding upon and inure to the benefit of the Parties hereto and their
voluntary and involuntary successors and assigns.
6.21 No Third Party Beneficiaries. The performance of the respective
obligations of City and Business under this Agreement are not intended to benefit any party
other than City or Business. No person or entity not a signatory to this Agreement shall
have any rights or causes of action against any Parry to this Agreement as a result of that
Party's performance or non-performance under this Agreement.
6.22 Nio Effect on Eminent Domain Authority. Nothing ink this Agreement
shall be deemed to limit, modify, or abridge or affect in any manner whatsoever City's
eminent domain powers with respect to any property.
6.23 Warranty Against Payment of Consideration. Business warrants that it
has not paid or given, and will not pay or give, any third party any money or other
consideration for obtaining this Agreement. Third parties,.for the purposes of this Section
6.23, shall not include persons to whom fees are paid for professional services if rendered
by attorneys, financial consultants, accountants, engineers, architects and.the like when
such fees are considered necessary by Business.
6.24 Severability. City and Business declare that the provisions of this
Agreement are severable. If it is determined by a court of competent jurisdiction that any
term, condition or provision hereof is void, voidable, or unenforceable for any reason
whatsoever, then such.term, condition or provision shall be severed from this Agreement
and the remainder of the Agreement enforced in accordance with its terms.
6.25 Further Acts. City and Business each agree to take such additional acts
and execute such other documents as may be reasonable and necessary in the performance
of their obligations hereunder. The foregoing shall not, however, be deemed to require
City to exercise its legislative discretion in any particular fashion or to provide to Business
any remedy or claim for damages against City based on the lawful exercise of City's
discretion.
6.26 No Assignment, Transfer, Pledge or Hypothecation. Business may not
assign,transfer, encumber or hypothecate its rights or obligations under this Agreement to
01247.0002/670104.1 15
any person or entity, without the express written consent of City, which may be withheld
in City's sole and absolute discretion. Any unpermitted assignment, transfer, pledge,
encumbrance, or hypothecation, or any attempt to do so, shall not confer any rights upon
the purported assignee or transferee and shall constitute Business's immediate and
incurable material default of this Agreement, and City may, without providing Business
notice or opportunity to cure,exercise those remedies available to City pursuant to Sections
4.6 and 4.7.2. Notwithstanding the foregoing, Business shall have the right to assign this
Agreement or any right or obligation hereunder to its immediate or ultimate parent, or to
an affiliate,by providing advance written notice to City.An"affiliate"shall mean any legal
entity that, at the applicable time, directly or indirectly controls, is controlled with or by,
or is under common control with, Business.
6.27 Relationship of Parties. The Parties shall not be deemed in a relationship
of partners or a joint venture by virtue of this Agreement,nor shall either Party be an agent,
representative, trustee or fiduciary of the other. Neither Party shall have any authority to
bind the other to any agreement.
[Signatures on following pages]
01247.0002/670104.1 16
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the date
and year first-above written.
CITY:
CITY OF G ND TERRACE, a municipal
corporation
0� z
G. Harold Duf y ity Marfer
EST:
ebra Thomas, 1 Clerk
APPROVED AS TO FORM:
ALESHIRE & , LLP
Adrian R. Guerra, City Attorney
BUSINESS:
SIERJ TACO CALIFORNIA, a California
limited liability company
By:
Name: Jasmin Patel
Title: Manager
Address: 1500 East Katella Avenue, Suite 5
Orange, CA 92867
Two corporate officer signatures required when Consultant is a corporation,with one signature required from
each of the following groups: 1)Chairman of the Board,President or any Vice President; and 2)Secretary,any
Assistant Secretary, Chief Financial Officer or any Assistant Treasurer. CONSULTANT'S SIGNATURES
SHALL BE DULY NOTARIZED, AND APPROPRIATE ATTESTATIONS SHALL BE INCLUDED AS
MAY BE REQUIRED BY THE BYLAWS, ARTICLES OF INCORPORATION, OR OTHER RULES OR
REGULATIONS APPLICABLE TO CONSULTANT'S BUSINESS ENTITY.
01247.0002/670104.1 17
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed
the document to which this certificate is attached,and not the truthfulness,accuracy or validity of that document.
STATE OF CALIFORNIA
COUNTY OF SAN BERNARDINO -�
On ,2021 before me, ,personally appeared N tt51h(11 6y fi ,proved to me on the
basis of satisfactory evidence to .be the person(s) whose names(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.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true
and correct.
WITNESS my hand and official seal. 16my
JULIE ANNE GARLAND
Notary Public-California
/;�� � Orange County s:
Signature: Idil-L
C'UWl.Z Commisslon N 2335471
Comm.Expires Oct 13,2024
OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and ould
prevent fraudulent reattachment of this form
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT
❑/ INDIVIDUAL
® CORPORATTEOFFICER
' b TITLE OR TYPE OF DOCLYNIEIjk
TITLE(S)
❑ PARTNER(S) ❑ LIMITED 19
❑ GENERAL NUMBER OF PAGES
❑ ATTORNEY-IN-FACT
❑ TRUSTEE(S)
❑ GUARDIAN/CONSERVATOR
❑ OTHER DATE OF DOCUMENT
SIGNER IS REPRESENTING:
(NAME OF PERSON(S)OR ENTITY(IES)) SIGNER(S)OTHER THAN NAMED ABOVE
01247.0002/670104.1 18
,;2oa�- aS
SALES TAX SHARING AGREEMENT
ARTICLE I PARTIES AND EFFECTIVE DATE.
1.1 Parties. This Sales Tax Sharing Agreement("Agreement") is entered into
on this 23rd day of February 2021 ("Effective Date") by and between the CITY OF
GRAND TERRACE, a California municipal corporation ("City"), and SERJ TACO
CALIFORNIA, LLC, a California limited liability company (the `Business"). City and
Business are sometimes referred to individually-as a "Party" and together as "Parties"
herein.
1.2 , Effective Date. This Agreement will not become effective until the date
on which both of the following are true: (i)this Agreement has been approved by the City
Council following all legally required notices and hearings; and (ii) this Agreement has
been executed by the appropriate authorities of City and Business.
ARTICLE II RECITALS.
2.1 Business is a fast food restaurant Taco Bell franchisee and is considering
establishing a new Restaurant Facility on the Property in the City of Grand Terrace, sales
from which are expected to generate significant sales tax revenues for the City.
2.2 To facilitate Business's �bility to construct and operate a new Restaurant
Facility at the Property, the City has agreed to waive $35,000 of building permit fees and
has also agreed to provide Business financial assistance by making payments to Business
of sales tax revenues paid by Business and collected by City from the California
Department of Tax and Fee Administration, in an amount of$8,300 per year for five (5)
years for a maximum total of$41,500, or until Business's sales exceed $1.6 million per
year, whichever occurs first.
2.3 The incentives provided in this Agreement are intended for the purpose of
facilitating Business's establishment and operation of a Restaurant Facility at the Property,
and help ensure that such facility remains at the Property for not less than five(5) years.
2.4 Entering into this Agreement will provide significant public benefits to the
City by encouraging Business to operate in the City for at least the minimum term of this
Agreement, thereby generating substantial sales and property tax revenue for the City,
creating new employment opportunities for 35 persons, and generally creating social and
economic benefits locally. The City has also determined that its entry into this Agreement
serves a significant public purpose while providing only incidental benefits to a private
party.
2.5 This Agreement has been reviewed with respect to applicability of the
California Environmental Quality Act ("CEQA"), the State CEQA Guidelines (California
Code of Regulations, Title 14, §§ 15000 et seq., hereafter the "Guidelines"), and the
environmental guidelines of the respective parties. This Agreement is not a"project" for
purposes of CEQA, as that term is defined by Guidelines §15378,because this Agreement
01247.0002/670104.1 1
is a government funding mechanism or other government fiscal activity, which does not
involve any commitment to any specific project which may result in potentially significant
physical impact on the environment, per §15378(b)(4) of the Guidelines, or alternatively,
an organizational or administrative activity that will not result in a direct or indirect
physical change in the environment.
2.6 City, in consideration of the additional Local Sales Tax Revenues (as
defined in Section 3.1.14)to be collected and remitted by Business for the benefit of City,
which City would not otherwise realize, desires to provide City Payments to Business as
compensation for Business establishing Operations at the Property through a Restaurant
Facility, and otherwise satisfying its obligations under this Agreement.
2.7 Such City Payment will be made on an annual basis from Local Sales Tax
Revenues actually received by City.
2.8 City and Business desire to enter into this Agreement for the purposes
described above.
ARTICLE III DEFINITIONS.
3.1 Definitions. Unless the context otherwise requires,the terms defined in this
Article III shall, for all purposes, and of any amendment hereof, and of any opinion or
report or other document 1 entioned herein or therein, have the meanings defined�ierein;
the following definitions to be equally applicable to both the singular and plural forms of
any of the terms defined herein.
3.1.1- "Agreement" shall have the meaning set forth in Section 1.1.
3.1.2 "Business Day" means a day which is not a Saturday, Sunday or
legal holiday on which banking institutions in the State of California or City are closed.
3.1.3 "CDTFA" means the California Department of Tax and Fee
Administration and any successor agency.
3.1.4 "City" shall have the meaning set forth in Section 1.1 and shall
include any nominee, assignee or successor to City's rights,powers and responsibilities.
3.1.5 "City Payment"means a payment in the amount of Eight Thousand
Three Hundred Dollars ($8,300), or a portion thereof where this Agreement is
automatically terminated pursuant to Section 4.7.1 in which event the City Payment will
be pro-rated based on a 365-day calendar year, paid by City to Business from the Local
Sales Tax Revenues received by City in accordance with Section 4.2.
3.1.6 "Data and Documentation" shall have the meaning set forth in
Section 4.2.2.
3.1.7 "Dispute Notice" shall have the meaning set forth in Section 6.16.
01247.0002/670104.1 2
3.1.8 "Effective Date" shall have the meaning set forth in Section I.I.
3.1.9 "Event of Default" shall have the meaning set forth in Section 4.5.
3.1.10 "Financial Assistance" shall have the meaning set forth in Section
4.1.
3.1.11 "First City Payment Date" shall have the meaning set forth in
Section 4.2.
3.1.12 "First Restaurant Sales Transaction Date" means the date
Business enters into its first Restaurant Sales transaction.
3.1.13 "Fiscal Quarter" means each of the four (4) three-month periods
within the Term and commencing on January 1, April 1, July 1, or October 1.
3.1.14 "Local Sales Tax Revenues" means that portion of the Sales Tax,
paid by Business,which is allocated and paid to City'pursuant to the Sales Tax Law. Local
Sales Tax Revenues shall not include: (i) Penalty Assessments, (ii) any Sales Tax levied
by, collected for or allocated to the State of California,the County of San Bernardino, or a
district or any entity(including an allocation to a statewide or countywide pool)other than
City, (iii) any administrative fee charged by the CDTFA, (iv) any Sales Tax subject to any
sharing, rebate, offset or other charge imposed pursuant to any applicable provision of
federal, state of local law,rule or regulation; or(v) any Sales Tax(or other funds measured
by Sales Tax) required by the State of California to be paid over to another public entity
(including the State) or set aside and/or pledged to a specific use other than for deposit into
or payment from the City's general fund.
3.1.15 "Minor Amendment" means any limited technical correction, or
not-substantive modification of this Agreement, as determined by the City Manager and
City Attorney.
3.1.16 "Operations" means Restaurant Sales consummated through the
Restaurant Facility to be operated by Business following the Effective Date of this
Agreement.
3.1.17 "Penalty Assessments" means penalties, assessments, collection
costs and other costs, fees or charges resulting from late or delinquent payment of Sales
Tax and which are levied, assessed or otherwise collected from Business.
3.1.18 "Property" means the 0.56 acre real property having Assessor's
Parcel Number 0275-242-13-0000, located at 22172 Barton Road, City of Grand Terrace,
California upon which it is anticipated that Business will operate the Restaurant Facility.
3.1.19 "Resolution Period" shall have the` meaning set forth in Section
6.16.
01247.0002/670104.1 3
3.1.20 "Restaurant Facility" means the Business's facility located upon
the Property and to be operated by Business following the Effective Date at which
Restaurant Sales transactions are consummated pursuant to the Sales Tax Law.
3.1.21 "Restaurant Sales" means all sales of food, beverage and other
items to any person or entity, which is subject to the Sales Tax Law and which generates
Local Sales Tax Revenues.
3.1.22 "Sales Tax"means all sales and use taxes levied under the authority
of the Sales Tax Law, excluding Sales Tax which is to be refunded to Business,because of
an overpayment of Sales Tax.
3.1.23 "Sales Tax Law" means (i) California Revenue and Taxation Code
Section 6001 et seq., and any successor law thereto, (ii) any legislation allowing City or
other public agency with jurisdiction in City to levy any form of Sales Tax, and (iii)
regulations of the CDTFA and other binding rulings and interpretations relating to (i) and
(ii)hereof.
3.1.24 "Term" shall mean that period commencing on the Effective Date
and ending upon the date City makes the last of the five (5) annual City Payments to
Business commencing on the First City Payment Date and continuing thereafter on an
annual basis (that is, after a total of$41,500 is paid to Business) unless Business's sales
should exceed $1.6 million (i) during the twelve-month period following the First
Restaurant Sales Transaction Date or (ii) any of the successive twelve-month periods
following the first anniversary of the First Restaurant Sales Transaction Date, in which
event this Agreement shall automatically terminate effective at the end of such annual
period.
ARTICLE IV OPERATION
4.1 Operation Covenant. Business hereby represents,warrants and covenants
that it shall conduct any Restaurant Sales operations through the Restaurant Facility in
accordance with this Agreement, the Sales Tax Law, and all other applicable provisions of
local, state and federal law. Business will not directly or indirectly solicit or accept any
"Financial Assistance" from any other public or private person or entity, if such Financial
Assistance is given for the purpose of causing or would result in Business's breach of the
covenants set forth in this Section 4.1. For purposes of this Section 4.1 the term"Financial
Assistance" means any direct or indirect payment, subsidy, rebate, or other similar or
dissimilar monetary or non-monetary benefit, including, without implied limitation,
payment of land subsidies, relocation expenses, public financings, property or sales tax
relief, rebates, exemptions or credits, relief from public improvement obligations, and
payment for public improvements to or for the benefit of Business.
4.2 Payment of City Payment. Within one hundred twenty (120) calendar
days following the one-year anniversary of the Effective Date ("First City Payment
Date") and on each anniversary of the First City Payment Date, and provided City has
received: (i) final reconciliation reports from the CDTFA for the time period for which
01247.0002/670104.1 4
}
Local Sales Tax Revenues were paid by Business, and (ii) all Data and Documentation
applicable to such time period, City will determine and pay to Business five (5) City
Payments for a maximum total of Forty One Thousand Five Hundred Dollars ($41,500) or
until Business's sales revenues exceed $1.6 million per year, whichever occurs first. To
determine whether Business's sales revenues exceed $1.6 million per year, sales shall be
calculated (i) during the twelve-month period following the First Restaurant Sales
Transaction Date or (ii) any of the successive twelve-month periods following the first
anniversary of the First Restaurant Sales Transaction Date. City Payments shall be paid on
an annual basis notwithstanding that calculations of the same based on final reconciliation
reports from the CDTFA and Data and Documentation shall be made on a Fiscal Quarter
basis.In the event Business' sales should exceed$1.6 million per year and this Agreement
should automatically terminate pursuant to Section 4.7.1, to the extent City Payments are
still owed, City shall remain obligated to pay Business even after the date of Agreement
termination.
4.2.1 Conditions Precedent to City Payments. City's obligations to
make any City Payments to Business hereunder are expressly contingent upon the
satisfaction of the following conditions precedent in each Fiscal Quarter after Business has
begun Restaurant Sales from the Property:
(i) Business having, for the entirety of such Fiscal Quarter or
portion thereof, as applicable, completely fulfilled its
material obligations under this Agreement;
(ii) City's receipt and reasonable approval of the Data and
Documentation, certified as complete and accurate by an
authorized Business ' officer or an authorized signatory
delegate; and
(iii) City possessing sufficient Local Sales Tax Revenues to
make a City Payment to Business.
Should any one or more of the foregoing conditions precedent-not be satisfied for
each Fiscal Quarter or portion thereof, as applicable, then City shall have no obligation to
make any City Payment to Business until such condition(s) precedent are met. If the City
elects to delay any payment on account of any such purported noncompliance by Business,
the City must promptly give Business written notice pursuant to Section 6.8 of all such
material obligations that the City alleges have not been fulfilled and cooperate with
Business's efforts to effect a cure or remedy with respect thereto.
4.2.2 Data and Documentation. For the purposes of this Agreement,
the term "Data and Documentation" means copies of Business's quarterly reports to the
CDTFA for the applicable Fiscal Quarter which sets forth the amount of Sales Taxes paid
to the CDTFA during the Fiscal Quarter arising from Business's Operations.
4.2.3 Adequate Consideration. Each City Payment due and payable
hereunder shall constitute the total payment to Business for the time period to which it
01247.0002/670104.1 5
relates. The Parties hereto have determined and agreed that the City Payment due and
payable under this Agreement represents fair consideration to Business for its covenants
and obligations hereunder. Business shall not be entitled to any reimbursement or other
compensation from City for any costs incurred by Business in performing or preparing to
perform its obligations under this Agreement. The City Payments shall not be reduced or
offset for any costs or expenses incurred by City in performing or preparing to perform its
duties under this Agreement.
4.2.4 No Carry Forward or Back. City and Business acknowledge and
agree that the calculation and determination of all financial components of the Parties'
rights and obligations under this Agreement shall be computed on a Fiscal
Quarter-to-Fiscal Quarter basis. Revenues generated in one Fiscal Quarter may not be
carried forward or back to any prior or future Fiscal Quarter,it being the express agreement
and understanding of the Parties that for each Fiscal Quarter the financial obligations of
the Parties and satisfaction of the conditions precedent to such obligations shall be
determined and made independently of any other Fiscal Quarter.
4.2.5 Source of City Payment. City Payments shall be payable only from
the Local Sales Tax Revenues received by City. City covenants to reasonably consider
such actions as may be necessary to include all City Payments owed hereunder in each of
its annual budgets during the Term and to reasonably consider the necessary annual
budgetary appropriations for all such City Payments.
4.2.6 Recapture of City Payments. If, at any time during or after the
Term of this Agreement, CDTFA makes a final Board determination that all or any portion
of the Local Sales Tax Revenues received by the City were improperly allocated and/or
paid to the City, and if CDTFA requires repayment of, offsets against future Sales Tax
payments, or otherwise recaptures from the City those improperly allocated and/or paid
Local Sales Tax Revenues,then Business shall,within thirty(30)days after written demand
from the City, together with reasonable documentation, repay all City Payments (or
applicable portions thereof). theretofore paid to Business which are attributable to such
repaid, offset or recaptured Local Sales Tax Revenues. If Business fails to make such
repayment within thirty(30)days after the City's written demand,together with reasonable
documentation, then such obligation shall.accrue interest from the date of the City's
original written demand at the then-maximum legal rate imposed by the California Code
of Civil Procedure on prejudgment monetary obligations, compounded monthly,until paid.
In addition, to the extent unpaid, City may withhold such amounts from future City
Payments.The City will promptly contact Business regarding any communication from the
CDTFA pertaining to tax allocations associated with Business's business.
4.3 Audit of Books and Records. Either Party shall make its books and
records relating to the rights and obligations under this Agreement available at no cost to
the requesting Party and/or its designees (including its accountants and/or attorneys) and
shall direct its accountants and other consultants and contractors in possession of its books
and records to do likewise; provided, however, that nothing herein shall be deemed to
abridge or constitute a waiver of any Party's evidentiary rights and privileges arising
pursuant to any provision of law, including, without implied limitation, the California
01247.0002/670104.1 6
Evidence Code, California Government Code(including the Public Records Act),the Code
of Civil Procedure, federal statutes and state or federal judicial decisions. Furthermore,
Business may redact or omit confidential information,including but not limited to customer
information such as addresses, names and phone numbers. Furthermore, all such non-
privileged books and records may be made available and introduced as evidence if ordered
by any court of competent jurisdiction. Each Party shall bear the costs of its own auditors,
experts and other consultants it may engage to complete its investigation of the other Party's
books and records; provided, however, that any audit and/or investigation ordered by the
court,may be recovered as an item of litigation expense pursuant to Section 6.13.
4.4 Employment Outreach for Local Residents. A goal of the City in
entering into this Agreement is to foster employment opportunities for City residents. To
that end, Business shall use commercially reasonable efforts to recruit and hire local
residents for full and part time employment opportunities at its Restaurant Facility, as
determined by Business in its sole discretion. Any offers of employment shall be at
Business's sole discretion. Nothing in this paragraph shall require Business to offer
employment to individuals who are not otherwise qualified for such employment. Without
limiting the generality of the foregoing, the provisions of this Section 4.4 are not intended,
and shall not be construed, to benefit or be enforceable by any person whatsoever other
than City.
4.5 Event of Default. Each of the following shall constitute an "Event of
Default": i
4.5.1 Failure by a Party to comply with and observe any of the conditions,
terms, or covenants set forth in this Agreement, if such failure remains uncured within
thirty (30) days after written notice of such failure from the non-defaulting Party to the
defaulting Party in the manner provided herein or, with respect to a default that cannot be
cured within thirty (30) days, if the defaulting Party fails to commence such cure within
such thirty (30) day period or thereafter fails to diligently and continuously proceed with
such cure to completion. However, if a different period, notice requirement, or remedy is
specified under any other section of this Agreement, then the specific provision shall
control.
4.5.2 Any representation or warranty contained in this Agreement or in
any application, financial statement, invoice, certificate, or report submitted pursuant to
this-Agreement proves to have been incorrect in any material respect when made.
4.6 Rights and Remedies; Rights and Remedies Not Exclusive. Unless
prohibited by law or otherwise provided by a specific term of this Agreement, the rights
and remedies of City and Business under this Agreement are non-exclusive and all
remedies hereunder may be exercised individually or cumulatively. Upon the other Party's
Event of Default, in addition to those remedies expressly granted herein, the Parties shall
also have the right to seek all other available legal and equitable remedies.
01247.0002/670104.1 7
4.7 Term and Termination.
4.7.1 As defined in Section 3.1.24, the Term of this Agreement shall be
the period commencing on the Effective Date and ending upon the date City makes the last
of the five (5) annual City Payments to Business commencing on the First City Payment
Date and continuing thereafter on an annual basis (that is, after a total of$41,500 is paid to
Business) unless Business's sales should exceed $1.6 million (i) during the twelve-month
period following the First Restaurant Sales Transaction Date or (ii) any of the successive
twelve-month periods following the first anniversary of the First Restaurant Sales
Transaction Date, in which event this Agreement shall automatically terminate effective at
the end of such annual period, it being understood that such sales amount may not become
known to the Parties until after the period ends.
4.7.2 In the event Business's lease agreement for the Property where the
Restaurant Facility is located expires or terminates or the operations of the Restaurant
Facility should terminate, Business may, at its option, terminate this Agreement upon
written notice to the City.
4.7.3 In addition to all other rights and remedies granted to the Parties
under this Agreement or available to them in equity or at law, either Party may terminate
this Agreement and all of its obligations hereunder without cost or liability upon the other
Party's Event of Default. Such termination shall not limit or abridge the rights and remedies
availab�e to the non-defaulting Party.
4.7.4 City may terminate this Agreement in the event Business does not
get a Certificate of Occupancy issued for the Restaurant Facility within one year of the
Effective Date.
ARTICLE V REPRESENTATIONS AND WARRANTIES
5.1 City Representations and Warranties. City represents and warrants to
Business that, to City's actual current knowledge:
(i) City is a municipal corporation exercising governmental
functions and powers and organized and existing under the
State of California;
(ii) City has taken all actions required by law to approve the
execution of this Agreement;
(iii) City's entry into this Agreement and the performance of
City's obligations under this Agreement do not violate any
contract, agreement or other legal obligation of City;
(iv) There are no pending lawsuits or other actions or
proceedings which would prevent or impair the timely
performance of City's obligations under this Agreement;
01247.0002/670104.1 8
(v) City has the legal right,power and authority to enter into this
Agreement and to consummate ' the transactions
contemplated hereby, and the execution, delivery and
performance of this Agreement has been duly authorized and
no other action by City is requisite to the valid and binding
execution, delivery and performance of this Agreement,
except as otherwise expressly set forth herein; and
(vi) The individual executing this Agreement is authorized to
execute this Agreement on behalf of City.
The representations and warranties set forth above are material
consideration to Business and City acknowledges that Business is relying upon the
representations set forth above in undertaking Business's obligations set forth in this
Agreement.
The term "actual current knowledge" as respecting City means, and is
limited to,the actual current knowledge of City Manager, as of the Effective Date,without
having undertaken any independent inquiry or investigation for the purpose of making such
representation or warranty. All of the terms, covenants and conditions of this Agreement
shall be binding on and shall inure to the benefit of City and its nominees, successors and
assigns.
5.2 Business Representations and `Varranties. Business represents and
warrants to City that, to Business's actual current knowledge:
(i) Business is _a duly formed California limited liability
company and is in good standing and qualified to do business
under the laws of the State of California;
(ii) The individual(s)executing this Agreement is/are authorized
to execute this Agreement on behalf of Business;
(iii) Business has taken all actions required by law to approve this
Agreement;
(iv) Business's entry into this Agreement and the performance of
Business's obligations under this Agreement do not violate
any contract, agreement or other legal obligation of
Business;
(v) There are no pending lawsuits or other actions or
proceedings which would prevent or impair the timely
performance of Business's obligations under this
Agreement; and
(vi) Business has the legal right,power and authority to enter into
this Agreement and to consummate the transactions
01247.0002/670104.1 9
contemplated hereby, and the execution, delivery and
performance of this Agreement have been duly authorized
and no other action by Business is requisite to the valid and
binding execution, delivery and performance of this
Agreement, except as otherwise expressly set forth herein.
The representations and warranties set forth herein are material
considerations to City and Business acknowledges that City is relying upon the
representations set forth above in undertaking City's obligations set forth above.
The term "actual current knowledge" as respecting Business means, and is
limited to, the actual current knowledge of the individual(s) executing this Agreement on
behalf of Business as of the Effective Date.
5.3 The City has entered into this Agreement with Business because of the
unique qualifications and identity of Business. No voluntary or involuntary successor-in-
interest of Business shall acquire any rights or powers under this Agreement except as
expressly set forth herein.
ARTICLE VI MISCELLANEOUS
6.1 Amendment;Modification. At any time City and Business may determine
that this Agreement should be amended for the mutual benefit of the Parties, or for any
other reason. Any such amendment to this Agreement shall only be by written agreement
between City and Business. City and Business agree to consider reasonable requests for
amendments to this Agreement which may be made by either of the Parties hereto,although
neither Party shall be obligated to approve any such amendment. Any amendments to this
Agreement must be in writing and signed-by the appropriate authorities of both City and
Business. With the concurrence.of the City Attorney, the City Manager is authorized on
behalf of City to approve and execute Minor Amendments to this Agreement (as defined
in Section 3.1.15)on behalf of City. Any amendment that is not a Minor Amendment shall
require approval by the City Council. Any such approved_ amendment shall control over
this Agreement.
6.2 California Law. This Agreement shall be construed and governed in
accordance with the laws of the State of California without regard to its conflict of laws
principles.
6.3 Execution in Counterparts. This Agreement may be executed in two (2)
or more counterparts, each'of which shall be deemed an original, and all of which shall
constitute but one (1) and the same instrument.
6.4 Business Days. Any act or thing required to be done or exist on any date
set forth herein which does not constitute a Business Day in any year shall be deemed to
be done or to exist on such date if such act or thing is done or exists on the next date which
constitutes a Business Day.
01247.0002/670104.1 10
6.5 Tax Consequences. Business shall be responsible and assume all liability
for federal, state and/or local income or other taxes resulting from its receipt of City
Payments.
6.6 Rights Not Granted. This Agreement is not, and shall not be construed to
be, a statutory development agreement under California Government Code Section 65864
et seq. or a disposition and development agreement under California Health and Safety
Code Section 33000 et seq. This Agreement is not, and shall not be construed to be, an
approval of or an agreement to issue permits or a granting of any right or entitlement by
City concerning any project, development, or construction by Business in City. This
Agreement does not, and shall not be construed to exempt Business in any way from the
requirement to obtain permits and/or other discretionary or non-discretionary approvals as
may be necessary for the development, maintenance and operation of any project,
development or construction within City.
This Agreement does not, and shall not be construed to exempt Business from the
application and/or exercise of City's power of eminent domain or its police power,
including, but not limited to, the regulation of land uses and the taking of any actions
necessary to protect the health, safety and welfare of its citizenry.
6.7 Consent. Whenever consent or approval of either Party is required under
this Agreement,that Party shall not unreasonably withhold,delay or condition such consent
or approval unless a different standard is otherwise provided by a specific provisiol of this
Agreement.
6.8 Notices and Demands. All notices or other communications required or
permitted between City and Business under this Agreement shall be in writing, and may be
(i) personally delivered, (ii) sent by United States registered or certified mail, postage
prepaid, return receipt requested, or (iii) sent by nationally recognized overnight courier
service (e.g., Federal Express), and addressed to the Parties at the addresses below subject
to the right of either Party to designate a different address for itself by notice similarly
given. Any notice so given by registered or certified United States mail shall be deemed
to have been received on the fourth (41h) Business Day after the same is deposited in the
United States mail. Any notice not so given by registered or certified mail, such as notices
delivered by courier service (e.g., Federal Express), shall be deemed received upon actual
receipt of the same by the Party to whom the notice is given.
To City: City of Grand Terrace
Attention: City Manager
22795 Barton Road
Grand Terrace, CA 92313
With a copy to: Aleshire&Wynder, LLP
Attention: Adrian Guerra, City Attorney
18881 Von Karman Ave., Suite 1700
Irvine, CA 92612
01247.0002/670104.1 11
To Business: SERJ Taco California, LLC
Attention: Jasmin Patel
1500 East Katella Avenue, Suite 5
Orange, CA 92867
6.9 Non-liability of City Officials and Employees. No officer, elected
official, contractor, consultant, attorney or employee of City shall be personally liable to
Business, any voluntary or involuntary successors or assignees of Business, or any lender
or other party holding an interest in Business's property, in the event of any default or
breach by City; or for any amount which may become due to Business or to its successors
or assigns, or on any obligations arising under this Agreement.
6.10 Conflicts of Interest. No officer, elected official, contractor, consultant,
attorney or employee of City shall have any personal interest, direct or indirect, in this
Agreement nor shall any such officer, elected official, contractor, consultant, attorney or
employee participate in any decision relating to this Agreement which unlawfully affects
his/her personal interests or the interests of any corporation, partnership or association in
which he/she is directly or indirectly interested.
6.11 Entire Agreement; Confidentiality. This Agreement contains all of the
terms and conditions agreed upon by the Parties. No other understanding, oral or
otherwise, in direct conflict with this Agreement shall be deemed to exist or to bind any of
the Parties 'hereto. All prior written or oral offers, counteroffers, memoranda of
understanding, proposals and the like are superseded by this Agreement. The terms and
existence of this Agreement will not be publicized or made public beyond what is required
by law. City shall keep any and all proprietary and confidential information and data
provided by Business under this Agreement strictly confidential to the extent permitted by
law. City will use information provided by Business pursuant to this Agreement only for
the purposes within the scope of this Agreement. Business shall clearly mark or otherwise
identify in writing all information it considers to be proprietary and confidential at the time
it is delivered to City. The confidentiality obligation under this section shall not apply to:
(a) information which is already public information or which is otherwise available to the
general public; (b)information received from a third party without a similar confidentiality
restriction who is lawfully in possession of the information and who has the lawful right to
disclose it; (c) information that is already in City's possession prior to receiving it from
Business; (d) information delivered by Business to City and not marked or otherwise
identified as proprietary and confidential at the time it was delivered; or (e) information
required to be disclosed under the California Public Records Act.
6.12 Force Majeure. Time is of the essence in the performance of the
obligations of City and Business under this Agreement. The time period(s) specified for
performance pursuant to this Agreement shall be extended because of any delays due to
unforeseeable causes beyond the control and without the fault or negligence of the delayed
Party,including,but not restricted to, acts of God or of the public enemy,unusually severe
weather, fires, earthquakes,floods, epidemics,quarantine restrictions,riots, strikes, freight
embargoes, wars, litigation, and/or acts of any governmental agency, including the City, if
the Party seeking to claim force majeure protection shall within ten (10) days of the
01247.0002/670104.1 12
commencement of such delay notify the other Party in writing of the causes of the delay.
The Party not seeking force majeure protection shall ascertain the facts and the extent of
delay, and extend the time for performance for the period of the delay when and if in the
judgment of such Party such delay is justified. Such determination shall be final and
conclusive upon the Parties to this Agreement.
6.13 Indemnification. Business agrees to indemnify and defend City and hold
it harmless from and against all third party demands, suits, proceedings, causes of action
or claims arising from, in connection with or related to this Agreement or from City's
performance of this Agreement, except to the extent such demand, suit, proceeding, cause
of action or claim was caused by City's negligence or intentional misconduct, or the
negligence or intentional misconduct of any of the City's officials, officers, employees, or
agents. The City shall fully cooperate in the defense of such demand, suit, proceeding,
cause of action or claim and upon written request of Business shall provide to Business
such documents and records in possession of.the City that are relevant to such demand,
suit, proceeding or claim and not otherwise protected by law.
6.14 Payment of Prevailing Wages. Business acknowledges that the City has
made no representation, express or implied, to Business or any person associated with the
Business regarding whether or not laborers employed relative to the construction and
installation of the Restaurant Facility, if any, must be paid the prevailing per diem wage
rate for their labor classification, as determined by the State of California, pursuant to
4abor Code Sections 1720,et seq.("Prevailing Wage Lav "). Business agrees with the City
that Business shall assume the responsibility and be solely responsible for determining
whether or not laborers employed relative to any construction pertaining to the Restaurant
Facility must be paid the prevailing per diem wage rate for their labor classification, as
determined by the State of California, pursuant to Labor Code Sections 1720, et seq. To
this end, Business acknowledges and agrees that should any third party, including but not
limited to the Director of the Department of Industrial Relations ("DIR"),require Business
or any of its contractors or subcontractors to pay the general prevailing wage rates of per
diem wages and overtime and holiday wages determined by the Director of the DIR under
Prevailing Wage Law,then Business shall(with counsel acceptable to the City)indemnify,
defend, and hold City harmless from any such determinations, or actions (whether legal,
equitable, or administrative in nature), liabilities, damages,penalties or other proceedings,
and shall assume all obligations and liabilities_ for the payment of such wages and for
compliance with the provisions of the Prevailing Wage Law. Business covenants and
agrees that Business shall assume the responsibility and be solely responsible for
determining whether or not laborers employed relative to any construction pertaining to
the construction of the Restaurant Facility must be paid the prevailing per diem wage rate
for their labor classification, as determined by the State of California, pursuant to the
Prevailing Wage Law.
6.15 Attorneys' Fees. In the event of the bringing of an action or suit by a Party
hereto against another Party hereunder by reason of any breach of any of the covenants or
agreements or any intentional inaccuracies in any of the representations and warranties on
the part of the other Party arising out of this Agreement or any other dispute between the
Parties concerning this Agreement then, in that event, the prevailing Party in such action
01247.0002/670104.1 13
or dispute,whether by final judgment or arbitration award, shall be entitled to recover from
the other Party all costs and expenses of suit or claim, including actual attorneys' fees and
expert witness fees. Any judgment, order or award entered in any final judgment or award
shall contain a specific provision providing for the recovery of all costs and expenses of
suit or claim, including actual attorneys' fees and expert witness fees (collectively,
"Costs") incurred in enforcing,perfecting and executing such judgment or award. For the
purposes of this Section 6.15, Costs shall include, without implied limitation, attorneys'
and experts' fees, costs and expenses incurred in the following: (i) post judgment motions
and appeals, (ii) contempt proceedings, (iii) garnishment, levy and debtor and third party
examination; (iv) discovery; and(v)bankruptcy litigation. This Section 6.15 shall survive
any expiration or sooner termination of this Agreement.
6.16 Informal Dispute Resolution. The Parties shall attempt in good faith to
resolve any differences, controversy or claim arising out of or relating to this Agreement
promptly by negotiations between senior officials of the Parties who have authority to settle
the difference or controversy. The disputing Party may give the other Party written notice
("Dispute Notice") that a dispute exists between them. Within twenty (20) days after
receipt of a Dispute Notice,the receiving Party shall submit to the disputing Party a written
response. The Dispute Notice and response shall include (a) a statement of each Party's
position and a summary of the evidence and arguments supporting its position, and(b) the
name and title of the official who shall represent that Party. The senior officials shall meet
at a mutually acceptable time and place or by telephone conference within thirty(30) days
of the date of the Dispute Notice, and thereafter as often as they reasonably deem necessary
to exchange relevant information and to attempt to resolve the dispute, up to a maximum
of ninety (90) days of the date of the Dispute Notice ("Resolution Period"). In the event
any Party fails to provide a response to a Dispute Notice in accordance with this section or
fails to cooperate in the scheduling of, or to attend, the meetings, described above, to
resolve the dispute, then,with respect to that Party, the Resolution Period shall be deemed
to have run so that the dispute may immediately be subject to legal action.
6.17 Jurisdiction and Venue. Any legal action or proceeding concerning this
Agreement shall be filed and prosecuted in the appropriate State of California court in the
County of San Bernardino, California. Both Parties hereto irrevocably consent to the
personal jurisdiction of that court. City and Business each hereby expressly waive the
benefit of any provision of federal or state law or judicial decision providing for the filing,
removal, or change of venue to any other court or jurisdiction, including, without implied
limitation, federal district court, due to any diversity of citizenship between City and
Business, due to the fact that City is a party to such action or proceeding or due to the fact
that a federal question or federal right is involved or alleged to be involved. Business
acknowledges that the provisions of this Section 6.17 are material consideration to City for
its entry into this Agreement, in that City will avoid the potential cost, expense and
inconvenience of litigating in a distant forum.
6.18 Interpretation. City and Business acknowledge that this Agreement is the
product of mutual arms-length negotiation and drafting and that both Parties have been
represented by legal counsel in the negotiation and drafting of this Agreement.
Accordingly, the rule of construction which provides that ambiguities in a document shall
01247.0002/670104.1 14
be construed against the drafter of that document shall have no application to the
interpretation and enforcement of this Agreement. In any action or proceeding to interpret
or enforce this Agreement, the finder of fact may refer to any extrinsic evidence not in
direct,conflict with any specific provision of this Agreement to determine and give effect
to the intention of the Parties with respect to any ambiguities in this Agreement.
6.19. No Waiver. Failure to insist on any occasion upon strict compliance with
any of the terms, covenants or conditions hereof shall not be deemed a waiver by any Party
of such term, covenant or condition, nor shall any waiver or relinquishment of any rights
or powers hereunder at any one time or more times be deemed a waiver or relinquishment
by any Party of such other right or power at any other time or times.
6.20 Successors and Assigns. The terms, covenants and conditions of this
Agreement shall be binding upon and inure to the benefit of the Parties hereto and their
voluntary and involuntary successors and assigns.
6.21 No Third Party Beneficiaries. The performance of the respective
obligations of City and Business under this Agreement are not intended to benefit any party
other than City or Business. No person or entity not a signatory to this Agreement shall
have any rights or causes of action against any Party to this Agreement as a result of that
Party's performance or non-performance under this Agreement.
6.22 No Effect on ETninent Domain Authority. Nothing in this Agreement
shall be deemed to limit, modify, or abridge or affect in any manner whatsoever City's
eminent domain powers with respect to any property.
6.23 Warranty Against Payment of Consideration. Business warrants that it
has not paid or given, and will not pay or give, any third party any money or other
consideration for obtaining this Agreement. Third parties, for the purposes of this Section
6.23, shall not include persons to whom fees are paid for professional services if rendered
by attorneys, financial consultants, accountants, engineers, architects and the like when
such fees are considered necessary by Business.
6.24 Severability. City and Business declare that the provisions of this
Agreement are severable. If it is determined by a court of competent jurisdiction that any
term, condition or provision hereof is void, voidable, or unenforceable for any reason
whatsoever, then such term, condition or provision shall be-severed from this Agreement
and the remainder of the Agreement enforced in accordance with its terms.
6.25 Further Acts. City and Business each agree to take such additional acts
and execute such other documents as may be reasonable and necessary in the performance
of their obligations hereunder. The foregoing shall not, however, be deemed to require
City to exercise its legislative discretion in any particular fashion or to provide to Business
any remedy or claim for damages against City based on the lawful exercise of City's
discretion.
6.26 No Assignment, Transfer, Pledge or Hypothecation. Business may not
assign, transfer, encumber or hypothecate its rights or obligations under this Agreement to
01247.0002/670104.1 15
any person or entity, without the express written consent of City, which may be withheld
in City's sole and absolute discretion. Any unpermitted assignment, transfer, pledge,
encumbrance, or hypothecation, or any attempt to do so, shall not confer any rights upon
the purported assignee or transferee and shall constitute Business's immediate and
incurable material default of this Agreement, and City may, without providing Business
notice or opportunity to cure, exercise those remedies available to City pursuant to Sections
4.6 and 4.7.2. Notwithstanding the foregoing, Business shall have the right to assign this
Agreement or any right or obligation hereunder to its immediate or ultimate parent, or to
an affiliate,by providing advance written notice to City.An"affiliate"shall mean any legal
entity that, at the applicable time, directly or indirectly controls, is controlled with or by,
or is under common control with, Business.
6.27 Relationship of Parties. The Parties shall not be deemed in a relationship
of partners or a joint venture by virtue of this Agreement,nor shall either Party be an agent,
representative, trustee or fiduciary of the other. Neither Party shall have any authority to
bind the other to any agreement.
[Signatures on following pages]
01247.0002/670104.1 16
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the date
and year first-above written.
CITY:
CITY OF G ND TERRACE, a municipal
corporation
V�,w
EST: e ,G. Harold Du City anager
L
ebra Thomas, City Clerk
APPROVED AS TO ORM:
ALESHIRE &VD , LLP
Adrian R. Guerra, City Attorney
BUSINESS:
SERJ TACO ALIFORNIA, a California
limited liability company
By: O—`'
Name: Jasmin Patel
Title: Manager
Address: 1500 East Katella Avenue, Suite 5
Orange, CA 92867
Two corporate officer signatures required when Consultant is a corporation,with one signature required from
each of the following groups: 1)Chairman of the Board,President or any Vice President; and 2)Secretary,any
Assistant Secretary, Chief Financial Officer or any Assistant Treasurer. CONSULTANT'S SIGNATURES
SHALL BE DULY NOTARIZED, AND APPROPRIATE ATTESTATIONS SHALL BE INCLUDED AS
MAY BE REQUIRED BY THE BYLAWS, ARTICLES OF INCORPORATION, OR OTHER RULES OR
REGULATIONS APPLICABLE TO CONSULTANT'S BUSINESS ENTITY.
01247.0002/670104.1 17
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed
the document to which this certificate is attached,and not the truthfulness,accuracy or validity of that document.
STATE OF CALIFORNIA
COUNTY OF SAN BERNARDINO
On US�u� ui�l C � i,y� Put
2021 before me, persona ly appeared U N✓�ll� �7�7`�i I,proved to me on the
basis satisfactory evidence to be the person(s) whose names(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.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true
and correct.
WITNESS y hand and official s 1. r JULIE ANNE GARLAND
`�" Notary Public-California
Orange County
Signatur r Commission f#2335471
'•�,.ca My comm.Expires Oct 13,2024
OPTIONAL
Though the data below is not required by law, it may prove v�luable to persons relying on the document and could
prevent fraudulent reattachment of this form
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT
INDIVIDAL
CORPORATE OFFICER &('64DT6W (/��{, ` d 91" 11 tz
(A�b TITLE OR TYPE OF DOCUNIENJ
TITLES)
❑ PARTNER(S) ❑ LIMITED
i
❑ GENERAL NUMBER OF PAGES
❑ ATTORNEY-IN-FACT
❑ TRUSTEE(S)
❑ GUARDIAN/CONSERVATOR r b�'�,{�{,� 2� 2-0 Z/
❑ OTHER DATE CIF DOCCMENT
SIGNER IS REPRESENTING:.
(NAME OF PERSON(S)OR ENTITY(IES)) SIGNER(S)OTHER THAN NAMED ABOVE
01247.0002/670104.1 18
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