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HomeMy WebLinkAboutC-2696(A) - 30th St, 426 (Cannery Village Parking Lot) - Base Lease Agreement 1988RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: CITY OF NEWPORT BEACH 3300 Newport Boulevard ExEMP? RECORDING REQb%...t PER GOVERNMENT CODE 6103 E?CEMPT C5 WECORDEO IN OFFICIAL RECORDS OF ORANGE COUNTY, CALIFORNA •10 40 AM APR 2 6'88 Newport Beach, CA 92663 /6 %CORDER Above area is for recording use only)C� _���)� DD CONSIDERATION REAL PROPERTY LEASE/PURCHASE AG EMENT (87-0340)W� THIS REAL PROPERTY LEASE/PURCHASE AGREEMENT (the "Lease") is dated as of February 15, 1988, by and between First Continental Financial Corporation, a Texas corporation ("FCFC"), and the City of Newport Beach, a body corporate and politic of the State of California ("the City"). WITNESSETH: WHEREAS, the City intends to acquire through purchase from Pelican Properties (the "Seller") or through condemnation proceedings that certain real property described in Appendix "A" attached hereto (the "Site"); and WHEREAS, the City, following its acquisition of the Site, intends to demolish and remove the improvements presently located thereon and to construct a paved, metered parking facility on the Site (the Site and the parking facilities to be constructed thereon, the "Project"); WHEREAS, the Project is an integral part of the City's plans to revitalize its Cannery Village Area, and the Site is designated for use as a public parking facility on the Cannery Village Specific Area Plan and other official documents of the City; and WHEREAS, in order to provide the funds necessary to pay the Project Cost (as defined herein) when due, the City and FCFC de- sire to enter into this Lease. NOW, THEREFORE, in consideration of the premises, the mutual covenants and provisions contained herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, FCFC and the City hereto agree as follows: 1. Lease of the Project. FCFC agrees to and does hereby lease the ProDect to the City and the City agrees to and does hereby lease the Project from FCFC, all upon the terms and con- ditions set forth herein. 2. Definitions. As used herein, the following terms shall be the following meanings unless the context clearly requires otherwise: "Base Lease" shall mean that certain "Base Lease Agreement," in substantially the form prescribed by the Indenture to be dated as of February 15, 1988, between the City, as lessee, and FCFC as the lessor, relating to the Site. "Concluding Payment Amount" shall mean the amount, as of a specific date, set forth on Exhibit "B" hereto. "Gross Revenues" shall mean all revenue and income of every nature derived or received by the the City from the opera- tion and ownership of the System, including interest income from the investment of moneys on deposit in the Off Street Parking Fund, the Parking Meter Fund or any account thereof. "Indenture" shall mean that certain Trust Indenture, dated as of February 15, 1988, and executed by and among FCFC, the City and the Trustee. "Lease Payments" shall mean, collectively, the 60 monthly deposits and the 10 semi-annual payments required to be made from pursuant to Section 4 hereof. Lease Term" shall mean the term of this Lease as set forth in Section 3 hereof. "FCFC" shall mean First Continental Financial Corporation, together with any successor or assignee thereof. "Net Revenues" shall mean Gross Revenues less current ex- penses of operating and maintaining the System, including such repairs and extensions as may be necessary to keep the System in operation and to render adequate service. "Pledged Revenues" shall mean Net Revenues and any funds lawfully appropriated by the City for payment of the Lease Payments. "Project" shall have the meaning ascribed to such term in the recitals hereof. "Project Acquisition Fund" shall mean the fund bearing such name established and held by the Trustee under the Inden- ture. �Am "Project Cost" shall mean in the aggregate $1,200,000. "System" shall mean the Project and all other parking spaces on facilities the Revenues from which are required to be or are presently deposited to the Parking Meter Fund or the Offstreet Parking Fund. "Trustee" shall mean Sovran Bank, N.A., a national banking association having its principal corporate trust offices in Richmond, Virginia. 3. Term. The term of this Lease will commence as of the date hereof, and, unless earlier terminated as expressly provided for in this Lease, will continue until payment of the final Lease Payment set forth in Exhibit "B" hereto. 4. Lease Payments. (a) The City agrees to pay to the Trustee as the assignee of FCFC under the Indenture, the Lease Payments (herein so called), including the interest component thereof, at the times and in the amounts specified in Exhibit "B" hereto. The Lease Payments will be payable without notice or demand at the principal corporate trust office of Trustee (or such other place as the Trustee or its assignee may from time to time designate in writing). (b) Any Lease Payment received later, than ten (10) days from the due date will bear interest at the highest lawful rate from the due date. (c) Except as specifically provided in Section 7 hereof, the City's obligation to pay the Lease Payments will be absolute and unconditional in all events and will not be subject to any set-off, defense, abatement, reduction, counterclaim, or recoupment for any reason whatsoever. (d) The City reasonably believes that funds can be obtained sufficient to make all Lease Payments during the Lease Term and hereby covenants that it will do all things lawfully within its power to obtain, maintain and properly request and pursue funds from which the Lease Payments may be made, including making pro- visions for such payments to the extent necessary in each budget submitted for the purpose of obtaining funding, using its bona fide best efforts to have such portion of the budget approved and exhausting all available administrative reviews and appeals in the event such portion of the budget is not approved. It is the City's intent to make Lease Payments for the full Lease Term first from funds which are legally appropriated therefor and then from Net Revenues. - 3 - 5. Project Acquisition Fund. (a) At such time as FCFC receives (i) a fully executed copy of this Lease, (ii) the docu- ments contemplated hereby and (iii) such closing certificates and opinions as may be reasonably required by FCFC, FCFC shall deliv- er or cause to be delivered to the Trustee an amount equal to the Project Cost for deposit by the Trustee to the Project Acquisi- tion Fund. (b) Moneys in the Project Acquisition Fund shall be applied and disbursed as set forth in the Indenture. (c) In no event shall payment be made from the Project Ac- quisition Fund for any Project Cost or portion thereof if the City is then currently in default with respect to the payment of any Lease Payment then due and currently owing under this Lease. 6. Project Completion. (a) The City agrees to acquire the Site on or about April 1, 1988, or as soon as possible thereafter and to proceed to construct and acquire the remainder of the Project in a reasonably prudent manner and in every case prior to February 15, 1991. (b) In the event the cost of the Project exceeds the Proj- ect Cost, the City agrees to provide such additional moneys as may be required for such purpose. (c) If, on the date which is six (6) months after the date hereof, amounts on deposit in the Project Acquisition Fund exceed the lesser of five percent (5%) of the Project Cost or $100,000; or if, on the date which is one year following the date hereof, amounts initially deposited to the Project Acquisition Fund have not been totally expended, the City shall take all steps as may be required by special tax counsel selected by FCFC to comply with the arbitrage rebate requirements of the Tax Reform Act of 1986, including without limitation Section 148(f) thereof. 7. Nonappropriation of Funds. (a) In the event insufficient funds are appropriated and budgeted in any fiscal period for Lease Payments due during such fiscal period under this Lease, then the City will immediately notify FCFC or its assignee of such occurrence and this Lease shall terminate on the last day of the fiscal period for which appropriations were received without penalty or expense to the City of any kind whatsoever, except as to the portions of Lease Payments herein agreed upon for which funds shall have been appropriated and budgeted. (b) The City shall have no right to terminate this Lease under this Section if, during the fiscal period that termination - 4 - of this Lease would have otherwise occurred, any funds are appro- priated to it, or by it, for the acquisition, retention or opera- tion of the Project or any other facilities (real or personal) or equipment performing functions similar to the Project. (c) In the event this Lease is terminated pursuant to this Section, the City agrees to peaceably surrender possession of the Project to the Trustee. The Trustee shall have all legal and equitable rights and remedies to take possession of the Project. (d) During the Lease Term, the City shall not give priority to the application of funds for the acquisition, retention or operation of any real or personal property or facilities perform- ing functions similar to the Project. (e) If the City terminates this Lease pursuant to this Sec- tion, the City agrees to not purchase, lease, rent or otherwise acquire the use of any real or personal property or facilities performing functions similar to the Project during the period commencing on the date of termination of this Lease and ending on last day of the fiscal period following the fiscal period during which the termination occurred. (f) If the City terminates this lease pursuant to this Section, the City agrees to immediately give effect to its pledge of the Pledged Revenues by immediately transferring to the Trustee under the Indenture all Pledged Revenues then on deposit in the City's Offstreet Parking Fund or Parking Meter Fund and to transfer any additional moneys deposited to such fund or funds from time to time therafter such transfer to occur on the first day of each month thereafter during the term of the Base Lease. 8. Limitation on Warranties. (a) The City acknowledges and agrees that any portion of the Project constituting personal property is of a size, design, and capacity selected by the City; that such personal property is satisfied that such personal prop- erty is suitable for its purpose; that FCFC is neither a manufac- turer nor a vendor of such personal property; and that FCFC HAS NOT MADE, AND DOES NOT HEREBY MAKE, ANY REPRESENTATION, WARRANTY, OR COVENANT, EXPRESS OR IMPLIED, WITH RESPECT TO THE MERCHANT- ABILITY, CONDITION, QUALITY, DURABILITY, DESIGN, OPERATION, FIT- NESS FOR USE, OR SUITABILITY OF THE PROJECT IN ANY RESPECT WHAT- SOEVER OR IN CONNECTION WITH OR FOR THE PURPOSES AND USES OF THE CITY, OR ANY OTHER REPRESENTATION, WARRANTY, OR COVENANT OF ANY KIND OR CHARACTER, EXPRESS OR IMPLIED, WITH RESPECT THERETO, AND FCFC SHALL NOT BE OBLIGATED OR LIABLE FOR ACTUAL, INCIDENTAL, CONSEQUENTIAL, OR OTHER DAMAGES OF OR TO THE CITY OR ANY OTHER PERSON OR ENTITY ARISING OUT OF OR IN CONNECTION WITH THE USE OR PERFORMANCE OF THE PROJECT AND THE MAINTENANCE THEREOF. =•= :: •111; (b) FCFC hereby assigns to the City during the Lease Term, so long as no Event of Default has occurred hereunder and is con- tinuing, all manufacturer's warranties, if any, expressed or im- plied with respect to the Project, and FCFC authorizes the City to obtain the customary services furnished in connection with such warranties at the City's expense. 9. Representations and Warranties. (a) The City repre- sents and warrants as of the date hereof and at all times during the Lease Term that: (i) the City is a fully constituted politi- cal subdivision or agency of the State of California; (ii) the execution, delivery and performance by the City of this Lease and all documents executed in connection herewith (the Lease together with all such documents shall be collectively referred to herein as the "Lease Documents") have been duly authorized by all neces- sary action on the part of the City; (iii) the Lease Documents each constitute a legal, valid and binding obligation of the City enforceable and in accordance with their respective terms; (iv) the entering into and performance of the Lease Documents will not violate any judgment, order, law or regulation applicable to the City or result in any breach of, or constitute a default under, or result in the creation of any lien, charge, security interest or other encumbrance upon the Project or any assets of the City pursuant to any indenture, mortgage, deed of trust, bank loan, credit agreement or other instrument by which the City is a party or by which it or its assets may be bound; (v) there are no actions, suits or proceedings pending or, to the knowledge of the City, threatened against or affecting the City in any court or before any governmental commission, board or authority, which, if adversely determined, will have a material, adverse effect on the ability of the City to perform its obligations under the Lease Documents; (vi) no governmental orders, permissions, consents, approvals or authorizations are required to be obtained and no registrations or declarations are required to be filed in con- nection with the execution and delivery of the Lease Documents; (vii) the City has observed and complied with all applicable pub- lic bidding procedures regarding the award of the transaction contemplated in the Lease Documents to FCFC; (viii) the City has sufficient appropriations or other funds available to pay all Lease Payments and other amounts due hereunder for the current fiscal period; (ix) the Project is an integral part of the City's plans to revitalize the Cannery Village area, and the Site is designated for use as a public parking facility on the Cannery Village Specific Area Plan and other official documents of the City; (x) no portion of the Project will be used directly or indirectly in any -trade or business carried on by any person other than the City; (xi) without receipt of an opinion of nationally recognized bond counsel that such action will not ad- versely affect the tax exempt status of the Lease Payments - 6 - hereunder or cause the Lease to become a "Private Activity Bond", as defined in the Internal Revenue Code of 1986, as amended (the "Code") the City will not enter into any contract or agreement pertaining to the use or operation of the Project (other than arrangements made pursuant to Section 12.44.125 of the Newport Beach Municipal Code pertaining to commercial in lieu parking fees; (xii) the obligations of the City under the Lease Documents will not constitute "arbitrage bonds" as that term is defined in Sections 103 and 148 of the Code and the City will take all actions required to maintain .such tax-exempt status and will refrain from taking any action which would adversely affect such tax exempt status; (xiii) the City will designate this Lease as a qualified tax-exempt obligation for purposes of Section 265(b)(3) of the Code; and (xiv) the aggregate face amount of all tax-exempt bonds (other than private activity bonds) issued by the the City (and all subordinate entities thereof) during calendar year 1988 is not reasonably expected to exceed $5,000,000. (b) The City shall deliver to FCFC an opinion of the City's counsel in form and substance acceptable to FCFC, dated the date hereof, as to the validity of the statements made in subsections (i) through (vii) above, inclusive. (c) A duly authorized officer of the City shall execute and deliver his certificate, dated as of the date hereof, as to the validity of the statements made in subsections (viii) through (xi) and (xiii) and (xiv) above, inclusive. (d) If requested by FCFC, the City shall deliver its cer- tificate in form and substance acceptable to FCFC described the facts upon which the statement contained in items and (xii) above are based. 10. Possession and Enjoyment. (a) During the Lease Term, FCFC shall provide the City with quiet use and enjoyment of the Project, provided such use is solely for a governmental purpose, and the City shall during the Lease Term peaceably and quietly have and hold and enjoy the Project, without suit, trouble or hindrance from FCFC. (b) FCFC will, at the request of the City and at the City's cost, join in any legal action in which the City asserts its right to such possession and enjoyment to the extent FCFC may lawfully do so. 11. Title to Project. (a) Title to the Project shall re- main in the City, subject to the rights of FCFC herein under this Lease and the Base Lease. Upon payment of all the Lease Pay- ments, FCFC shall execute a cancellation of this Lease and the - 7 - Base Lease and shall enter into an agreement prepared by the City, terminating this Lease and shall enter into an quitclaim of all of its right, title and claim in and to the Project, and shall take all actions necessary to authorize, execute and deliv- er to the City any documents which may be necessary to vest in the City all of FCFC's interest in and to the Project, including, if necessary, a release of any and all liens created under the provisions of this Lease or by FCFC. FCFC agrees to defend or eliminate any claims adverse to such interest arising out of an event occurring after receipt by FCFC of its leasehold interest in the Project; provided that FCFC's obligations under this sen- tence shall not extend to claims arising out of actions by the City or persons asserting claims under it. (b) FCFC acknowledges that the City intends to and may use the Project in conjunction with its 'in lieu' parking program established pursuant to the provisions of Section 12.44.125 of the Newport Beach Municipal Code (such program authorizes a waiv- er of some or all of the off-street parking required by pro- visions of the Newport Beach Zoning Ordinance if the person in need of parking pays an annual fee of $150.00 per parking space.); provided however, such persons participating in such program shall not be granted, nor shall there by conveyed to any such person, any possessory or proprietary interest in or to the Project, the Site or any portion thereof. 12. Grant of Mortgage and Security Interest. (a) The City does hereby mortgage in favor of FCFC all estate, right, title and interest of the City in and to the buildings, structures, improvements, fixtures, equipment, machinery, apparatus and in- stallation now or at anytime hereafter erected, constructed and situated on the Site, to have and to hold said property with all rights, appurtenances and privileges thereunto belonging, unto FCFC, its successors and assigns forever, the City hereby releas- ing and waiving all rights to retain possession of the said prop- erty upon the occurrence of an event of default hereunder and, to the extent permitted by law, all right of appraisement, sale and redemption, to secure the payment of all amounts due from the City hereunder, including without limitation the Lease Payments, and the performance of all obligations, covenants and agreements of the City hereunder. (b) The City does hereby irrevocably pledge and grant unto FCFC a first lien and prior security interest in and to the Pledged Revenues for the purpose of securing the City's obliga- tions to make Lease Payments hereunder and the performance and observance by the City of all of its covenants, expressed or im- plied, herein including, without limitation the City's obligation under Section 7(f) hereof, which pledge shall survive any termin- ation of this Lease pursuant to Section 7 hereof or Section 23 hereof. (c) The City does hereby grant to FCFC a first and prior security interest in any and all right, title and interest of the City in the portion of the Project constituting personal property and in all additions, attachments, accessions, and substitutions thereto, and on any proceeds therefrom. (d) The City agrees that this Lease may be filed as a fi- nancing statement evidencing such security interest; and further agrees to execute and deliver all financing statements, certifi- cates of title and other instruments necessary or appropriate to evidence such security interest. 13. Maintenance and Modification of Project. (a) The City shall, at its own expense, maintain, preserve and keep the Proj- ect in good repair, working order and condition, and shall from time to time make all repairs, replacements and improvements nec- essary to keep the Project in such condition. FCFC shall have no responsibility for any of these repairs, replacements or improve- ments. (b) The City shall, at its own expense, have the right to remodel the Project or to make additions, modifications and im- provements thereto. All such additions, modifications and im- provements shall thereafter comprise part of the Project and be subject to the provisions of this Lease. Such additions, modi- fications and improvements shall not in any way damage the Proj- ect nor cause it to be used for purposes other than those au- thorized under the provisions of applicable local, State and Fed- eral law; and the Project, upon completion of any additions, mod- ifications and improvements made pursuant to this Section, shall be of a value which is not substantially less than the value of the Project immediately prior to the making of such additions, modifications and improvements. Any property for which a sub- stitution. or replacement is made pursuant to this Section may be disposed of by the City in such manner and on such terms as are determined by the City. (c) The City will not permit any mechanic's or other lien to be established or remain against the Project for labor or mate- rials furnished in connection with any construction remodeling, additions, modifications, improvements, repairs, renewals or re- placements made by the City pursuant to this Section; provided that if any such lien is established and the City shall first notify the Trustee of the City's intention to do so, the City may in good faith contest any lien filed or established against the Project, and in such event may permit the items so contested to remain undischarged and unsatisfied during the period of such contest and any appeal therefrom unless the Trustee shall notify the City that, in the opinion of Independent Counsel, by nonpay- ment of any such item the interest of the Trustee in the Project will be materially endangered or the Project or any part thereof will be subject to loss or forfeiture, in which event the City shall promptly pay and cause to be satisfied and discharged all such unpaid items or provide the Trustee with full security against any such loss or forfeiture, in form satisfactory to the Trustee. FCFC and the Trustee will cooperate fully with the City in any such contest, upon request and at the expense of the City. 14. Taxes, Other Governmental Charges and Utility Charaes. (a) The City shall pay all property and excise taxes and other governmental charges of any kind whatsoever which are at any time lawfully assessed or levied against or with respect to the Proj- ect or any part thereof or the Lease Payments, which become due during the term of this Lease. The City shall also pay when due all gas, water, steam, electricity, heat, power, telephone, and other charges incurred in the operation, maintenance, use, occu- pancy and upkeep of the Project, and all special assessments and charges lawfully made by any governmental body for public im- provements that may be secured by a lien on the Project; provided that with respect to special assessments or other governmental charges that may lawfully be paid in installments over a period of years, the City shall be obligated to pay only such install- ments as are required to be paid during the Lease Term as and when the same become due. The City shall not be required to pay any Federal, state or local income, inheritance, estate, suc- cession, transfer, gift, franchise, gross receipts, profit, ex- cess profit, capital stock, corporate, or other similar tax pay- able by FCFC, its successors or assigns, unless such tax is made in lieu of or as a substitute for any real estate tax upon the Project. (b) The City may, at the City's expense and in the City's name, in good faith contest any such taxes, assessments, utility and other charges and, in the event of any such contest, may per- mit the taxes, assessments or other charges so contested to re- main unpaid during the period of such contest and any appeal therefrom unless the Trustee shall notify the City that, in the opinion of Independent Counsel, by nonpayment of any such items the interest of the Trustee in the Project will be materially endangered or the Project or any part thereof will be subject to loss or forfeiture, in which event the City shall promptly pay such taxes, assessments or charges or provide the Trustee with full security against any loss which may result from nonpayment, in form satisfactory to the Trustee. =51M 15. Indemnification. The City shall defend, and indemnify FCFC against, and hold FCFC harmless from, any and all claims, actions, proceedings, expenses, damages or liabilities, including attorneys' fees, court costs, judgments and interest thereon, arising out of, or in any way related to, the Project, including, but not limited to, its selection, purchase, delivery, pos- session, use, operation, condition, or existence, provided, how- ever, the City's duty to defend, indemnify and hold FCFC harmless shall not extend to claims or lawsuits arising out of the sole and exclusive negligence, or willful misconduct, of FCFC or its employees. The City shall, through its established program of self-insurance, promptly investigate and process all claims for bodily injury or property damage that are in any way related to the project. The City shall notify FCFC, in writing, of any claim or loss that has a reasonable judgment potential in excess of $100,000.00 and, upon request, will make all information rela- tive to the claim or lawsuit available to FCFC. 16. Insurance. Lessee shall maintain a commercially reasonable program of self-insurance covering all risks of loss and damage to the Project. 17. Advances. If the City shall fail to perform any of its obligations under this Article, FCFC may, but shall not be obligated to, take such action as may be necessary to cure such failure, including the advancement of money, and the City subject to appropriation, shall be obligated to repay all such advances on demand, with interest thereon at the highest rate allowed by applicable law. 18. Liens. The City shall not, directly or indirectly, create, incur, assume or suffer to exist any mortgage, pledge, lien, charge, encumbrance or claim on or with respect to the Project or Pledged Revenues, other than the respective rights of FCFC and the City as herein provided. Except as expressly provided in this Section, the City shall promptly, at its own expense, take such action as may be necessary to duly discharge or remove any such mortgage, pledge, lien, charge, encumbrance or claim if the same shall arise at any time. The City shall reimburse FCFC for any expense incurred by it in order to discharge or remove any such mortgage, pledge, lien, charge, encumbrance or claim. 19. Damaqe, Destruction and Condemnation. (a) The City assumes all—risk of loss of or damage to the Project from any cause whatsoever, and no such loss of or damage to the Project nor defect therein nor unfitness or obsolescence thereof shall relieve the City of the obligation to make Lease Payments or to perform any other obligation under this Lease. (b) Unless the City shall have exercised its option to pur- chase FCFC's interest in the Project by payment of the Concluding Payment Amount as herein provided, if prior to the termination of this Lease (i) any component of the Project is destroyed (in whole or in part) or is damaged by fire or other casualty or (ii) title to or the temporary use of such component of the Project or the interest of the City or FCFC in the component of the Project, shall be taken under the exercise of the power of eminent domain by any governmental body or by any person, firm or corporation acting under governmental authority, the net proceeds of any in- surance or condemnation award shall be held in a separate insur- ance fund created by the City to be applied to the prompt repair, restoration, modification or improvement of the Project. (c) If the City determines that the repair, restoration, modification or improvement of the Project is not economically feasible or in the best interest of the City, then, in lieu of making such repair, restoration, modification or improvement, the City shall promptly purchase FCFC's interest in the Project by paying to FCFC the then applicable Concluding Payment Amount and such net proceeds shall be applied to such payment to the extent required for such payment. Any insurance proceeds remaining af- ter such work has been completed or after the Concluding Payment Amount has been paid shall belong to the City. 20. Purchase Option. Commencing on and after February 15, 1989, and annually thereafter, upon thirty (30) days prior writ- ten notice from the City to FCFC, and provided that there is no Event of Default, or an event which with notice or lapse of time, or both, could become an Event of Default, then existing, the City will have the right to purchase the Project on the Lease Payment dates set forth in Exhibit "B" by paying to FCFC, on such date, the Lease Payment then due together with the Concluding Payment Amount set forth opposite such date. Upon satisfaction by the City of such purchase conditions, FCFC will transfer any and all of its right, title and interest in the Project to the City as is, without warranty, express or implied, except that FCFC will warrant to the City that the Project is free and clear of any liens created by FCFC other than the lien of the Inden- ture. 21. Assiqnment. (a) Without FCFC's prior written consent, the City will not either (i) assign, transfer, pledge, hypo- thecate, grant any security interest in or otherwise dispose of this Lease or the Project or any interest in this Lease or the Project, or (ii) sublet or lend the Project or permit it to be used (except for its intended purposes as a parking facility open to the general public) by anyone other than the City or the City's employees. =VM (b) FCFC may assign its rights, title and interest in and to this Lease, the Project and any other documents executed with respect to this Lease and/or grant or assign a security interest in this Lease and the Project, in whole or in part. Any such assignees shall have all of the rights of FCFC under this Lease. Upon assignment of FCFC's interests herein, FCFC will cause writ- ten notice of such assignment to be sent to the City which will be sufficient if it discloses the name of the assignee and ad- dress to which further payments hereunder should be made. No further action will be required by FCFC or by the City to evi- dence the assignment, but the City will acknowledge such assign- ments in writing if so requested and will provide such further Certificates and acknowledgements as reasonably requested by FCFC. (c) Subject to the foregoing, this Lease inures to the ben- efit of and is binding upon the successors and assigns of the parties hereto. (d) The City shall retain all notices of assignment and maintain a book -entry record which identifies each owner of FCFC's interest in the Lease, including without limitation the Trustee. Upon the City's receipt of written notice of Lessor's assignment of all or any part of its interest in the Lease, the City agrees to attorn to and recognize any such assignee as the owner of Lessor's interest in this Lease, and the City shall thereafter make such payments, including without limitation such Lease Payments, as are indicated in the notice of assignment, to such assignee. 22. Events of Default. The term "Event of Default", as used herein, means the occurrence of any one or more of the fol- lowing events: (a) the City fails to make any Lease Payment (or any other payment) as it becomes due in accordance with the terms of this Lease; (b) the City fails to perform or observe any other cove- nant, condition, or agreement to be performed or observed by it hereunder and such failure is not cured within twenty (20) days after written notice thereof by FCFC; or, (c) the discovery by FCFC that any statement, representa- tion, or warranty made by the City in this Lease or in any writ- ing ever delivered by the City pursuant hereto or -in connection herewith is false, misleading, or erroneous in any material re- spect. 23. Remedies. and as long as such its option, exercise (a) By written to all amounts then Payments due during able, whereupon the able; Upon the occurrence of an Event of Default, Event of Default is continuing, FCFC may, at any one or more of the following remedies: notice to the City, declare an amount equal due under this Lease and all remaining Lease the Lease Term to be immediately due and pay - same shall become immediately due and pay - (b) By written notice to the the City, request the City to (and the City agrees that it will), at the City's expense, promptly return the Project to FCFC, or FCFC, at its option, may enter upon the Project and take immediate possession thereof; (c) Sublease the Project for the account of the City, holding the City liable for all Lease Payments and other payments due to the effective date of such selling, leasing or subleasing and for the difference between the purchase price, rental and other amounts paid by the purchaser, lessee or sublessee pursuant to such sale, lease or sublease and the amounts payable by the City hereunder; and, (d) By written notice to the City, demand that the City immediately give effect to its pledge of the Pledged Revenues by immediately transferring to the Trustee under the Indenture all Pledged Revenues that are on deposit in the City's Offstreet Parking Fund or Parking Meter Fund, and exercise any right, remedy or privilege which may be available under applicable laws of the State of California or other applicable law to assure such transfer is made and that transfers of any additional moneys deposited to such fund or funds from time to time thereafter are transferred to the Trustee on the 1st day of each month thereafter during the term of the Base Lease; and (e) Exercise any other right, remedy or privilege which may be available to it under applicable laws of the State of California or any other applicable law or proceed by appropriate court action to enforce the terms of this Lease or to recover damages for the breach of this Lease or to rescind this Lease as to any or all of the Project. In addition, the City will remain liable for all covenants and agreements under this Lease and for all legal fees and other costs and expenses, including court costs, incurred by FCFC with respect to the enforcement of any of the remedies listed above or any other remedy available to FCFC. - 14 - 24. Notices. All notices to be given under this Lease shall be made in writing and mailed by certified mail, return receipt requested, to the other party at its address set forth below or at such address as the party may provide in writing from time to time. Any such notice shall be deemed to have been re- ceived five days subsequent to mailing. If to FCFC: First Continental Financial Corporation 8080 North Central Expressway, Suite 850 Dallas, Texas 75206 Attn: President If to the City: City of Newport Beach 3300 Newport Boulevard P.O. Box 1768 Newport Beach, California 92658 Attn: City Attorney 25. Headings. All headings contained herein are for the convenience of reference only and are not intended to define or limit the scope of any provision of this Lease. 26. Governinq Law. This Lease shall be construed in accor- dance with, and governed by the laws of, the State of California. 27. Delivery of Related Documents. (a) the City will exe- cute or provide, as requested by FCFC, such other documents and information as are reasonably necessary with respect to the Transaction contemplated by this Lease. (b) At the request of FCFC, the City will furnish FCFC an- nual financial statements of the City within one hundred and twenty (120) days after the end of the City's fiscal year. (c) During the Lease Term, the City will provide to FCFC annually the applicable budget with proof of appropriation for the ensuing fiscal year and such other financial information relating to the ability of the City to continue this Lease as may be reasonably requested by FCFC. 28. Entire Lease; waiver. This Lease, together with the Acceptance Certificate and other attachments hereto, and other documents or instruments executed by the City and FCFC in con- nection herewith, constitute the entire agreement between the parties with respect to the lease of the Project, and this Lease shall not be modified, amended, altered, or changed except with the written consent of the City and FCFC. Any provision of this Lease found to be prohibited by law shall be ineffective to the extent of such prohibition without invalidating the remainder of - 15 - this Lease. The waiver by FCFC of any breach by the City of any term, covenant or condition hereof shall not operate as a waiver of any subsequent breach thereof. EXECUTED by the parties hereto as of the day and year first set forth above. First Continental Financial Newport Beach, California Corporation By: '_n c c t o���� ter. By: �C•t L W (Authorized Officer signature `e- Name: /e a41 /e- 7- Title: - Tit1e: -- 16 - ACKNOWLEDGEMENT STATE OF TEXAS § COUNTY OF DALLAS On this the 21st day of February r 1988, Barbara Friedman , who acknowledged khj (her) self to be an Authorized Officer of First Continental Financial Corpo- ration and that, in such capacity i0m) (she) executed the forego- ing Real Property Lease/Purchase Agreement for the purposes set forth herein. WITNESS my hand and official seal. S E A L Notary Public, in and for said County and State My commission expires 12/1/91 ACKNOWLEDGEMENT STATE OF CALIFORNIA § COUNTY OF ORANGE On this the 18th day of February r 1988, Robert L. Wynn , who acknowledged (him) (&rx) self to be an Authorized Officer of the City of Newport Beach, California and that, in such capacity (he)(st�e) executed the foregoing Real Property Lease/Purchase Agreement for the purposes set forth herein. i WITNESS my hand and official seal. n !r S E A L L Notary Publi n and for said County and S to .•... ` OFFICIAL SEAL DOROTHY L. PALEN tl NOTARY PUBLIC - CALIFORNIA M commission expires Y p April 5, 1989 PRINCIPAL OFFICE IN ORANGE COUNTY My Commission Exp. Apr. 5, 1989 i 88-190008 EXHIBIT A TO REAL PROPERTY LEASE -PURCHASE AGREEMENT NO. 87-0340 Description of Property Site That certain tract of land lying the City of Newport Beach, Orange County, California, and more particularly described as follows: PARCEL 1: Lots 12, 13, 14, 15, 16, and 17 in Block 230 of Lancaster's Addition to Newport Beach, as shown on a map recorded in Book 5, Page 14 of Miscellaneous Maps, in the Office of the County Recorder of said county. Except the Westerly 12.5 feet of said Lot 17. A portion of said land is included within the area shown on a map filed in Book 94, Page 7 of Parcel Maps, in the Office of the County Recorder of said county. *AFTER MAKING THE LEASE PAYMENT DUE ON SUCH DATE. "B« 88-190008 EXHIBIT TO REAL PROPERTY LEASE/PURCHASE AGREEMENT NUMBER 87-0340 LEASE CERTIFICATE PRINCIPAL INTEREST CONCLUDING* DATE PM'T # DEPOSIT ........ CREDITS .......... FUND BALANCE ------------ LEASE PAYMENT ............. ........... COMPONENT COMPONENT PAYMENT AMOUNT --------- ------------- ...... ...... 3/15/88 1 13,693.59 4/15/88 2 13,693.59 5/15/88 3 13,693.59 6/15/88 4 13,693.59 7/15/88 5 13,693.59 8/15/88 6 13,693.59 4,835.89 86,997.43 24,880.00 24,880.00 9/15/88 7 13,693.59 10/15/88 8 13,693.59 11/15/88 9 13,693.59 12/15/88 10 13,693.59 1/15/89 11 13,693.59 2/15/89 12 13,693.59 7,114.57 151,393.54 149,880.00 125,000.00 24,880.00 671,101.30 3/15/89 13 13,693.59 4/15/89 14 13,693.59 5/15/89 15 13,693.59 6/15/89 16 13,693.59 7/15/89 17 13,693.59 8/15/89 18 13,693.59 4,884.22 88,559.30 21,255.00 21,255.00 9/15/89 19 13,693.59 10/15/89 20 13,693.59 11/15/89 21 13,693.59 12/15/89 22 13,693.59 1/15/90 23 13,693.59 2/15/90 24 13,693.59 7,305.45 156,771.29 156,255.00 135,000.00 21,255.00 535,866.71 3/15/90 25 13,693.59 4/15/90 26 13,693.59 5/15/90 27 13,693.59 6/15/90 28 13,693.59 7/15/90 29 13,693.59 8/15/90 30 13,693.59 4,847.52 87,525.35 17,137.50 17,137.50 9/15/90 31 13,693.59 10/15/90 32 13,693.59 11/15/90 33 13,693.59 12/15/90 34 13,693.59 1/15/91 35 13,693.59 2/15/91 36 13,693.59 7,418.93 159,968.32 157,137.50 140,000.00 17,137.50 392,792.84 3/15/91 37 13,693.59 4/15/91 38 13,693.59 5/15/91 39 13,693.59 6/15/91 40 13,693.59 7/15/91 41 13,693.59 *AFTER MAKING THE LEASE PAYMENT DUE ON SUCH DATE. EXHIBIT "B" TO REAL PROPERTY LEASE/PURCHASE AGREEMENT NUMBER 87-0340 INTEREST CONCLUDING* COMPONENT PAYMENT AMOUNT --------- ------------- 12,762.50 2/15/92 48 LEASE CERTIFICATE PRINCIPAL DATE PM'T # DEPOSIT CREDITS FUND BALANCE LEASE PAYMENT COMPONENT ........ .......... ...... 8/15/91 ...... 42 ............ ............. ----------- 13,693.59 4,932.70 89,925.06 12,762.50 9/15/91 43 13,693.59 10/15/91 44 13,693.59 11/15/91 45 13,693.59 12/15/91 46 13,693.59 1/15/92 47 13,693.59 INTEREST CONCLUDING* COMPONENT PAYMENT AMOUNT --------- ------------- 12,762.50 2/15/92 48 13,693.59 7,668.26 166,992.36 162,762.50 150,000.00 12,762.50 240,960.91 3/15/92 49 13,693.59 4/15/92 50 13,693.59 5/15/92 51 13,693.59 6/15/92 52 13,693.59 7/15/92 53 13,693.59 8/15/92 54 13,693.59 4,984.19 91,375.59 7,962.50 7,962.50 9/15/92 55 13,693.59 10/15/92 56 13,693.59 11/15/92 57 13,693.59 12/15/92 58 13,693.59 1/15/93 59 13,693.59 2/15/93 60 .......... 13,693.59 87,398.29 .......... 252,972.92 252,962.50 245,000.00 7,962.50 1.00 821,615.40 141,390.02 ............... ........... 962,995.00 .......... 795,000.00 167,995.00 *AFTER MAKING THE LEASE PAYMENT DUE ON SUCH DATE.