Dr. Salwan cancels theater purchase agreement
Thursday, October 11, 2001
Contact: Nancy Shelvy - (510)317-6640
SAN LORENZO -- Immediately following the public signing of both a letter of agreement for the purchase of the Lorenzo Theater by the Lorenzo Theater Foundation last month and a donation agreement, the owner, Dr. Dharam Salwan, cancelled the donation agreement stipulated in the purchase agreement.
In the agreement, signed by Dr. Salwan and Foundation representative Larry Leal at a public gathering at the Theater, Dr. Salwan agreed to donate $200,000 to the Foundation in return for his parents' names to be prominently displayed on the building. "As part of this purchase agreement, Dr. Salwan will finance $306,000 himself. $94,000 of the donation will go to pay off the existing note on the property" Leal announced to the gathering prior to the signing of the agreements.
Dr. Salwan has since stated that he did not have time to review the donation agreement at the press conference. Foundation documentation clearly shows that the agreement was faxed to Dr. Salwan on two separate occasions in late August and discussed in person several times prior to the signing.
Other meetings followed and on September 17 Leal faxed a summary of the proposal to Dr. Salwan, and on September 20 faxed a document outlining the joint announcement of the sale containing the statement: "Your donation (sign the donation agreement in front of all) then YOU hand me the large prop along with the actual check".
The Foundation's original meetings with Dr. Salwan were to negotiate a long term lease agreement. On July 28, 2001, Dr. Salwan offered a solution for the Foundation to purchase the property from him. His solution was the $200,000 donation offer that would make the sale possible, which he has since rescinded.
Dr. Salwan has since proposed a counter donation offer which has been declined by the Foundation's Board of Directors. "It is the feeling of the Board that if Dr. Salwan can sign an agreement publicly, after ample time to review all documentation with the legal and business advisors he uses with his real estate transactions, and then claim he didn't have time to review the agreement prior to his signing that agreements, what guarantee is there he won't pull out of his counter offer?", Leal stated.
"We have a fiduciary responsibility to our donors to utilize their donations wisely. It is the decision of the Board to turn down Dr. Salwan's counter offer because the Board decided that acceptance of the counter offer would violate that fiduciary responsibility. However, we are willing to move forward with the original agreement," Leal concluded.
(Complete documentation of the negotiations, including a video of the signing, is available as well as the signed agreement .)