SR-6-E-19
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Santa i'Io:nca, Callfornla June 9, 1980 '.E.I,!
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W: Nayor and Clty councll
JUN 2 4 1980
FRO~l: Clty Staff
SUBJECT : Reccmmendatlon to a,mrd bld for Boat Orlented Uses of S~lff Rental
Area
BID 1\,[0. 1513
I:ITPODUCTIOK
TIllS concesslon, located on the Santa Honlca Pler, \nll :te rentmg motor I:oats
fer f lshl..'1g mSlde the break '"ater. TIllS lease wlll run for a perioe. of one
(1) year ',nth an optlon for tlrree (3) consectutlve yearly rene'.vals. The terms
are to :te 5220.00 plus hfteen (15) percent of gross recelpts per month. In
response to publlShed Notlce Invltl'1g Blds, blds 'vere recelved and publlcly op=Jled
&'1d read f.lay 15, 1980. P-.coposals '",ere mailed to flve (5) conceSSloners and notlces
"Jere publlShed III accorda'1ce '.nth Clty Charter and HLlIllclpal Code provlsions.
'J\'D (2) blds vJere recelved. 'The Bld by Hest l\'llld Salllllg Club '.,'as ruled to be non-
responslve by the Clty Attorney. The Bld contailled no prices, no percentage rental
and no bldder I s :.:ond.
RECO"r.IENDATION
It lS recarrnended the a'.vard be mace to the only responsive bldder ~Ilchael Lee
Kennedy, ill the amount of 5220.00 per rnonth plus hfteen (15) percent of sales
and that the Clty Manager be author lzec to execute the lease agreemeIlt.
Prepared By: R. :;. Aronoff
Purchasillg Agent
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JUN 2 4 1980
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SANTA MONICA PIER
LEASE FORM
Table of Contents
Page
REC I TALS I
l. TERM I
2. RENT I
2. J Minimum Annual Rental I
2.2 Additional Percentage Rental I
2.3 Late Payment Penalty 2
2.4 Definition of Gross Sales 2
2.5 Maintenance of Records 2
2.6 Verification of Records, Payments and Correction
of Percentage Rentals 2
2.7 Retention of Records 3
2.8 Adjustment of Minimum Annual Rentals 3
3. PERM ITTED USES 4
4. CONTROL OF ACCESS 4
5. IMPROVEMENTS TO BE CONSTRUCTED BY LESSEE 4
5. I Alterations or Modifications 4
5.2 Ut i 1 it i es 4
6. SECURITY FOR RENT AND REPAIRS c:
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7. MAINTENANCE AND REPAIR 6
7. I Lessee's Obligation to Maintain and Repair 6
7.2 Lessor's ObI igation to Maintain and Repair 6
7.3 Lessor's Right of Entry and RepaIr 6
7.4 Limitations on Lessor's ObI igation to Repair 6
8. REMOVAL OF DEBRIS 7
9. SURRENDER OF LEASED PREMISES 7
9.1 Lessee's Obligation to Surrender upon Expiration .,
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9.2 Surrender of Improvements 7
10. TITLE AND WARRANTIES 7
11. ENCUMBRANCE OF LEASEHOLD 8
12. HOLD HARMLESS AND INSURANCE 8
12.1 Exculpatory Clause and Indemnification of Lessor 8
12.2 Waiver of Claims 8
12.3 Acceptance of Premises in Present Condition 8
12.4 Insurance Hazards Prohibited 9
12.5 Public LiabfJity and Property Damage Insurance 9
12.6 Workmen's Compensation Insurance 9
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13. ASSIGNMENT OR SUBLETTING 10
13. I Restrictions O~ Assignment or Subletting 10
13 .2 Term i nat j on 10
13.3 Effect of ~essor's Consent JO
13.4 Written Assumption ~greenent 10
13.5 Transfer on Termination 10
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14. DEFAULT AND REMEDIES 10
14.1 Default 10
14.2 Lessor's Election 11
14.3 Cumulative Remedies 12
14.4 Waiver 12
14.5 Right of Re-entry 12
14.6 Percentage Rental Upon Default 13
14.7 Lessor's Right to Cure Default 13
15. CONDEMNAT~ON 13
16. DAMAGE OR DESTRUCTION 13
16.1 Partial Destruction of Premises 13
16.2 Material Destruction of Premises 13
16.3 Commencement and Completion of Restoration 13
16.4 Rent Upon Destruction 14
17. ABANDONMENT 14
18. COMPLIANCE WITH LAWS 14
19. SUPERVISION AND CONDUCT OF LESSEE'S EMPLOYEES 14
20. OPERATIONS AND CHARGES 14
20. I Hours of Business 14
20.2 Fees and Charges 14
20.3 Binding on Agents, Sublessees, Concessionaires.
and Licensees 15
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21. TAXES ]5
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21.] Taxes and Assessments 15
21.2 Hold Harmless Clause 15
21.3 Separate Assess",ents of Real and Personal
Property 15
21.4 Time of Payment 15
21.5 Payment by Lessor on Lessee's Default 15
22. LESSEE'S ASSOCIATION 15
23. WASTES; NUISANCE; UNLAWFUL USE PROHIBITED 16
24. HOLDING OVER ]6
25. NOTICE FOR PROCESS 16
25.1 Not ices 16 .
25.2 Notices to Lessor 16
25.3 Notices to Lessee 16
25.4 Change of Address 16
25.5 Multiple Parties 16
25.6 Services of Process 16
26. GENERAL PROVISIONS ]7
26.1 Conditions and Covenants 17
26.2 Presumption That Pre~ises Abandoned 17
26.3 Time of Essence 17
26.4 Computation of Time . 17
26.5 Captions 17
26.6 Attorney's Fees 17
26.7 Term Includes Extensions 17
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26.8 Number and Gender 17
26.9 Interpretation 18
26.10 Mod i ficat ion 18
26.11 Entire Agreement 18
26.12 partial Inval idity 18
EXHIBITS:
"A" Tidelands Grant
" elt Legal Description
"e" Perm i tted Uses
"0" Hours of Business
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THIS LEASE is made and entered into as of the 18 day of
June 1980, between the City of Santa Monica, a chartered munici-
,
pal corporation of the State of Cal ifornia, hereinafter referred to as "Lessor,"
and Ml.chael Lee Kennedy
hereinafter referred to as "Lessee;"
RECITALS
WHEREAS, by and through 1917 general statutes 78, as amended by 1970
general statutes 1077 (hereinafter referred to as "Grant,") a copy of which
Grant is attached hereto as Exhibit "A" and incorporated herein, the State of
California has granted to Lessor certain tide and submerged lands for commerce
and navigation; and
WHEREAS, in order to develop and improve said tide and submerged
lands for commerce and navigation, Lessee desires to enter into this Lease for
rental of those parcels situated on or about the Santa Monica Pier hereinafter
referred to as the "Premises," which are located in that area: commonly known
and referred to as the "Santa Monica Pier and Harbor Area," described more
particularly in Exhibit "B" attached hereto and incorporated herein by reference;
and
WHEREAS, Lessee desires to enter into this Lease for the rental of
the Premises on which improvements are now or will hereinafter be situated;
NOW, THEREFORE, the parties hereto agree that Lessor does hereby lease,
and Lessee does hereby hire from Lessor, the Premises for the covenants and
considerations and upon the terms and conditions hereinafter stated.
I. TERM
The term of this Lease, hereinafter referred to as the "Lease Term,"
shall be One ( 1 ) years, commencing on J~e 30, 1980 ,
and expi ring on July 1, 1981 ' unless sooner terminated as prOVided
below.
2. RENT
2. I MJNIMUM ANNUAL RENTAL
During the Lease Term, Lessee shall pay to Lessor a minimum annual
rental in the amount of <;2:20_00 dollars ($ 220.od,
payable in advance on or before the tenth (10th) day of each calendar month in
an amount equal to one-twelfth (1/12) of the minimum annual renta I. Said
one-twelfth (1/12) of said minimum annual rental shall hereinafter be referred
to as the minimum monthly rental. Said minimum annual rental shall be subject
to any adjustments of minimum annual rentals as hereinafter provided for in
this Lease.
2.2 ADO IT] ONAL PERCENTAGE R,ENTAL
In addition to the minimum monthly rental, during the Lease Term
Lessee shall pay to Lessor percentage rental due and payable on or before the
tenth (10th) day of the month immediately following the month in which the cumu-
lative gross sales, during the Lease Year covering said month, exceeds the minimum
annual sales. Said minimum annual sales shall be determined by dividing the
minimum annual rental by the percentage established below. Said percentage
rental shall be in the amount of Plft~n percent
( 15 %) of said cumulative gross sales in excess of said ~inimum an~ual sales.
Thereafter during each and every month of the Lease Year. Lessee
shall pay to Lessor percentage rental in the amount of . F~ftee.l1.
percent ( 15 Z) of the gross sales made during each ~onth. Sa~d percentage rental
shall be due and payable on or before t~e tenth (10th) day of the month immediately
following said month.
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I. TERM
I(a) OPTfON
(I) In the event that Lessee meets and satifles each and everyone of
the conditions enumerated herein below, and each and everyone of the condltiors
enumerated in Exhibit "E", attached hereto and incorporated herein by reference,
and only in such event, Lessee may elect, if not at the time in default under this
Lease. to extend the ter~ of this Lease for an additional period of Three
years from the eXDiration date hereof, but otherwise on the same terms, covenants,
and conditions herein contained.
(2) This option shall be exercised on or before the sixtieth (60th)
day preceding the expiration of this Lease by the giving of written notice of his
election to extend this Lease. Said notice shall be served pursuant to Article 25
. of this Lease.
INDEMNIFICATION AND HOLD HARMLESS
(a) This Lease is made on the express condition that if
accepted by the City Council, said Lessee agrees that
Lessor will be free from all liability or loss by reason
of injury to person or property, from whatever cause,
while in or on the premises, or in any way connected with
the premises or with the improvements or personal property
therein or thereon, including, but not by way of limitation,
any liability for injury to the person or property of
Lessee, its agents, officers and employees Lessee
hereby covenants and agrees to, and shall, indemnify the
Lessor and save it harmless from any and all liability,
loss, costs, or obligations on account of, or arising
out of, any such injuries or losses however occurring,
~ncluding consequential damages.
(b) Lessee, as a material part of the consideration of said
lease will hereby waive all claims against Lessor for
damages to goods, wares, merchandise, buildings,
installations or other improvements in, upon, or about
the premises, and for injuries to Lessee, his agents
or employees or persons in and about the premises from
any cause arising at any time. Lessee will hold Lessor
exempt and harmless from any damages or injurv to person,
or to the goods, wares, merchandise, facilities or any
property of any person arising fro~ the use of the premises
by Lessee or from the failure of Lessee to keen t~e
premises in go~d condition repair, as herein provided,
when such damage or injury shall be caused in part or
~n whole by the negligence or fault of, or omissions of
any duty with respect to the same by Lessee. Lessee
further expressly waives all rights under Section 1542
of the Civil Code of California as it now provides or
may hereafter be amended. Section 1542 reads as follows:
"A general release does not extend
to claims which the creditor does
not know or suspect to exist in
its favor at the time of executing
the release, which if known by him
must have materially affected his
settlement ~vith the debtor."
(c) Lessee accepts the premises and any other improvements
on the premises in their present condition, and is without
any representation or warranty by Lessor as to t~e
condition of such, or as to the use or occupancy which
may be made thereof and the Lessor shall not be respon-
sible for any latent defect or change of condit~on in
the prem~ses, or improvements thereon, or for any change
in the condition or-for any da~age occurring thereto,
or because the existence of any violations of anv state,
county, or municipal statutes," laws or regulations
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For purposes of this Article 2.2, said cumulative gross sales
shall only be accumulated during each and every Lease Year of the Lease Term
and not from Lease Year t~ Lease Year.
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2.3 LATE PAYMENT PENALTY
If rental payable to Lessor by Lessee pursuant to this Lease
is not paid within a ten (10) day period from its due date, a penalty of ten
percent (10%) of the amount due and unpaid shall be added to the amount when
due and the total sum shall immediately become due and payable to Lessor. A
further penalty of ten percent (1~1o) of the amount due and unpaid, including
previously assessed penalties, shall be added for each month that said amount
remains unpaid. This provision shall in no way restrict the right of Lessor
to terminate this Lease for failure to pay rent as provided in this Lease.
2.4 DEFINITION OF GROSS SALES
The term "Gross Sales" shall be the gross selling price of all
merchandise or services sold in or from the Premises by Lessee or Lessee's
agents, sublessees, licensees and concessionaires whether for cash or on credit,
and whether made by store personnel or vending machines, excluding therefrom
the following:
(a) Sales Taxes and other similar taxes now or hereafter imposed
upon the sale of merchandise or services, subject to the condition that Lessee
submit verified records, documents, or tax forms substantiating the payment by
Lessee of said taxes.
(b) Sales of fixtures, equipment or property which are not stock
in trade.
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All sales originating in or about the Premises shall be considered
as made and completed therein, even though bookkeeping and payment of the account
may be transferred to another place for collection, and even though actual
filling of the sale or service order and actual delivery of the merchandise may
be made from a place other than the Premises.
2.5 MAINTENANCE OF RECORDS
(a) Lessee shall keep, or cause to be kept, in a form acceptable
to Lessor, full, complete and proper books, records and accounts of the gross
sales both for cash and on credit, for each separate business of Lessee, its
agents, sublessees, concessionaires Qr licensees at any tIme operated on the
Premises. , Upon the giving of four (4) days written notice by Lessor, said
books, records and accounts, including any and all sales tax reports that Lessee,
its agents, sublessees, concessionaires or licensees may be required to furnish
to any government or governmental ag~ncy, and any and all bank accounts maintained
by, controlled by, or in the name of Lessee, its agents, sublessees, concession-
aires or licensees in connection with its or their business activities operated
upon the Premises as described in Exhibit "B" attached hereto and incorporated
herein, shall be open to the inspection of Lessor, Lessor's auditor, or other
representative or agent of Lessor.
(b) Lessee shall at all times keep and maintain in good operating
order and condition, upon the Premises, a cash register which shall register all
sales on a tape and be so constructed that it cannot be reversed or turned back
or not register sales thereon without the use of a key or other device which
shal I be exclusively in the hands of the Lessor; and Lessee shall register on
said cash register every sale of every kind or character made in or from the
Premises, whether for cash or on credit. Said cash register, or any other
alternate method of recording said sales, must be approved in writing by Lessor.
2.6 VERIFICATION OF RECORDS, PAYMENTS AND CORRECTION OF PERCENTAGE
RENTALS
(a) Within ten (10) days after the end of each calendar month
during the Lease Term, Lessee shall furnish Lessor with a ~tatement to be certi-
fied as correct by Lessee which is to set forth the gross sales, as hereinabove
defined, of each separate business of Lessee, its agents, sublessees, conces-
Sionaires or licensees operating on the Premises for the month just concluded,
and with each statement. Lessee shall pay Lessor the a~ount of the percentage
rental which is payable to Lessor based on the application of the percentage
hereinabove set forth to said gross sales as shown in said statement.
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(b) The acceptance by Lessor of any monies paid to Lessor by
Lessee as percentage rental for the Premises, as shown on any statement furnished
by Lessee, shall not be an admission of the accuracy of said statement or of the
sufficiency of the amount of said percentage ren~al payment. Lessor shall be
entitled at any time within three (3) years after the receipt of any such per-
centage rental payment to question the sufficiency of the amount thereof and/or
the accuracy of the statement or statements furnished by Lessee to Justify the
same. Should any audit conducted pursuant to this section disclose that percentage
rental on gross sales for the period In question exceeds the amount of percentage
rental paid to Lessor by Lessee during said period, Lessee sha 11 illl11ediately P<lY
the amount of such deficiency to Lessor. In the event that said defiCiency is
in excess or five percent (~I.) of the percentage rental paid to Lessor by Lessee
during said period, the cost of said audit shall be paid by Lessee. In the event
that said deficiency is in excess of ten percent (10%) of the percentage rental
paid to Lessor by Lessee during said period, such event shal I constitute a material
breach of this Lease, and shall be subject to the remedies contained in Article 14
of this Lease.
2.7 ~ETENTfON OF RECORDS
For the purposes oT enabling Lessor to check the accuracy of any
such statement or statements furnished to Lessor by Lessee, and the sufficiency
of any additional rental payments made in accordance therewith, Lessee shall for
a period of three (3) years after submission to Lessor of any such statements,
keep safe and intact all of Lessee's records, books, accounts, and other data
which in any wise bear upon or are required to establish detail of gross sales
and any authorized deductions therefrom as shown by any such statement. Upon the
giving of four (4) days written notice by Lessor, said records, books, accounts
and other data shall be open to the inspection of Lessor, Lessor's auditor or
other representative or agent of Lessor.
2.8 ~DJUSTMENT OF MINIMUM ANNUAL RENTALS
(a) At the expiration of the initial three (3) year period of the
Lease Term, Lessor and Lessee agree to the adjustment of the minimum annual ren ta 1
. provided for in Article 2.1 hereinabove. Said adjusted minimum annual rental
shall be the greater amount in terms of increase of the two amounts computed in
paragraphs 2.8(a) (1) and 2.8 (a)(2) hereinafter as fol lows:
(1 ) The average of all of the annual rentals and sums due and
payable pursuant to Article 2 of this Lease during said three (3) year period, or
if a greater increase;
(2) The percentage increase or decrease in the Consumer Price
Index (C.P.I.) as determined by the following calculation: The base of computing
the adjustment is the index figure for the month of April, 1976, as shown in the
Consumer Price Index (all items) , Los Angeies-Long Beach, based on the period
1967=100. The adjustment date shall be the month of April, 1979, and said index
publ ished for that month shall be computed as a percentage of the base figure.
For example, assuming the index figure on the base date is 110 and the index
figure on the adjustment date is 121, the percentage to be applied is 121/110 =
1.10 = 110 percent. That percentage shall be appl ied to the minimum annual rent
for the lease year commencing July 1, 1979.
(b) Thereafter at the commencement of each subsequent year of the
Lease Term, Lessor and Lessee agree to the adjustment of the minimum annual rental
computed pursuant to the Consumer Price Index as follows; The base of computing
the adjustment is the index figure for the month which is fourteen months prior
to the commencement of subject Lease Year, as shown in the C.P.I. (a 11 items) ,
Los Angeles-Long Beach. The adjustment date shall be the month which is two montr,s
prior to the commencement of subject Lease Year, and the index publ ished for that
month shall be computed as a percentage of the base figure. For example, assuming
the index figure on the base date is 110 and the index figure on the adjustment
aa te IS 121. the percentage to be appl ied is 121/110 = 1.10 = 110 percent. That
percentage shall be appl ied to the minimum annual rent for the subject Lease Year.
If the Index is calculated from a base different from the base
pe r i ad 1967=100 used for the base figure above, the base figure used for calcu-
lating the adjustment percentage shall first be converted under a formula suppl led
by the U.S. Bureau of Labor Statistics.
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(c) The aforementioned Consumer Index figures shall hereafter be
ascertained from the revised Consumer Price Index (all items) for Los Angeles-
~ong Beach. California, compiled, publ ished and issued monthly by the United
States Department of Labor, Bureau of Labor Statistics. If the aforementioned
Consumer Price Index (all items) for Los Angeles-Long Beach, California, as now
constituted, compiled, published and issued monthly by the United States Department
of Labor, Bureau of Labor Statistics, shall cease to be compiled and made publ ic
and shafl have another index substituted in its place, said substituted index shall
be used for the purpose of calculating the increase or decrease, if any, in the
aforementioned minimum annual ren ta I . If a new Consumer Price Index should be
deVised by the Department of Labor, Bureau of Labor Statistics, so as to apply
and include more specifically Lessor's City and the Premises located therein, said
devI sed index shall be substituted and used for the purpose of calculating the
increase or decrease, if any, in the aforementioned minimum annual renta I.
3. PERMITrED USES
Lessee shall not use, or permit the Premises, or any part thereof. to
be used for any purpose or purposes. other than the purpose or purposes, and on
the conditiorls, set forth in Exhibit "e" attached hereto and by this reference
incorporated herein. Any provision contained in th is Lease, to the contrary
notwithstanding, said Premises shall not be used for any purpose which shall
interfere with commerce, navigation or fishery or be inconsistent with any trusts
upon which the Premises are now or may hereafter be heid by the Lessor.
4. CONTROL OF ACCESS
Lessor, at its opti on and in its sole discretion, may at any time
control and limit access to, in or about, the Santa Monica Pier and Harbor Area
for the public health, safety, welfare, or for any public purpose. Lessor sha II
not be liable or responsible for any damages arising therefrom to the Premises,
buildings, structures, installations or improvements thereon, or any business or
operation of Lessee. Lessee further agrees any such action by Lessor does not
entitle LeSsee to a proration of any rent and other sums due under this Lease,
-and Lessee will.remain liable for the full amount of rent and other sums due,
except as hereinafter provided in this Article. In the event that such control
and limitation of access renders the Premises totally unusable for Lessee's
purposes as herein limited for a period exceeding seventy-two (72) hou rs , then
from said seventy-second (72nd) hour LeSsee shall be entitled to a credit against
the minimum annual rental payable of one three-hundred-sixty fifth (1/365) or
said rental for each day from said seventy-second (72nd) hour that renders the
Premises totally unusable for Lessee's purposes.
5. IMPROVEMENTS TO BE CONSTRUCTED 6Y LESSEE
5.1 ALTERATIONS OR MOOIFICA~IONS
Lessee may make, at its own cost and expense, any alterations,
modifications or other changes in the Premises, or cause to be built, made or
installed thereon any buildings, structures, equipment, appliances, utilities,
signs or other improvements necessary or desirable for its use of the Premises,
provided, however, that any such alterations, modifications, or other changes,
excluding minor repairs, made on the Premises, and that any such buildings,
structures, equipment, appliances, utilities, signs and other improvements
built or installed, shall be accomplished in accordance with the plans, speci-
fications, or other designs previously submitted to and approved in writing by
the Lessor. Said approval or disapproval, as the case may be, shal I be submrtted
in writing within a reasonable period from the receipt of Lessee's application.
5.2 UTILITIES
(a) Lessee agrees that any authorized uti! rtv company has the
right. subject to Lessor's written approval, to run utility lines, pipes, condUIts,
or ductwork, where necessary or desirable, through the Premises ir a ~anner which
wi II not interfere unnecessarily WIth Less~e's use of the Premises.
(0) Lessee shall have the responsibility to continue to connect
the utilities provided on the Premises to its facilities. and to furnis~, ins ta 11
and maintain, at its own expense, all necessary ducts, pipes, and condu; ts to
service adequately its own Installations.
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(c) Lessee agrees that no use shall be made by Lessee of the
Premises or the utilities thereon which in any way shall interfere with or disturb
the existing utilities of other Lessees or of Lessor's facilities on the pier.
(d) Lessee shall pay for any and all utilities on Lessee's
Premises for use by Lessee in its business activities, whether provided by Lessor,
public utility companies, or private companies.
(e) Lessee shall be responsible for the removal of any and all
trash, garbage, rubbish, and debris originating from, created on, and located on
the Premises and shall not be liable for the removal of trash which may exist on
other portions of the pier whether or not on public or private areas.
6. SE~URITY FOR RENT AND REPAIRS
(a) Lessee shall deposit with Lessor on or before the effective date
of this Lease a sum equal to ten percent (10%) of the minimum annual renta I.
(b) Except as otherwise expressly provided in this Paragraph 6(b),
said security deposit shall be subject to any adjustment of minimum annual rental
as hereinbefore provided in Article 2.8 of this Lease. Said deposit shalJ be
increased in an amount equaJ to ten percent (J~I.) of the increase in the adjusted
minimum annual renta 1 . In the event of a decrease in the adjusted minimum annual
rental for anyone (1) year period of the Lease Term, said security deposit shall
neither be increased nor decreased for the one (1) year period in which the
minimum annual rental is decreased and Lessee shall not be entitled to a refund
of any portion of said security deposit and subsequent adjusted security deposits
except as hereinafter provided in Paragraph 6(f) herein. Said adjusted increase
shaJl be payable on or before the effective date of the adjustment of the minimum
annual rental for each one (I) year period of thiS Lease.
(c) Said security deposit and all adjusted security deposits shaJl be
heJd by Lessor as security for the faithfuJ performance by Lessee of all of the
terms, covenants, and conditions of this Lease by said Lessee to be kept and
performed du ring the Lease Term or any renewa 1 thereof. I f at any t I me du ring
the Lease Term any rent herein reserved shaJl be overdue and unpaid, then Lessor
may. at the option of Lessor, appropriate and apply any portion of said deposit
to the payment of any such overdue rent or other sum. In the event of the failure
of Lessee to keep and perform all of the terms, covenants, and conditions of this
Lease to be kept and performed by Lessee, Lessor may, at its option, appropriate
and apply said deposits, or so much thereof as may be necessary to compensate
Lessor for a 1 J loss or damage sustained or suffered by Lessor due to such breach
on the part of Lessee. Lessor shall give three (3) days written notice to Lessee,
in the event that Lessor elects, at its option, to appropriate and apply said
deposit pursuant to this Article 6.
(d) Said security deposit and all adjusted security deposits shall be
placed in an interest bearing account by the Lessor and actual i nteres t earned,
if any, shall be payable to Lessee within thirty (30) days of the end of each
twelve (12) month period during the Lease Term.
(e) Should the entire deposit, or any portion thereof, be appropriated
and appiied by Lessor for the payment of overdue rent or other sums due and
payable to Lessor by Lessee hereunder, then Lessee shall, upon the written
demand of Lessor, forthwith remit to Lessor a suffiCient amount in cash to restore
said security to a sum equal to ten percent (1~1o) of the minimum ann~al renta 1.
(f) Should Lessee comply with all of said terms, covenants and condi-
tIons and promptly pay all of the rental herein provided for as it fa 11 s due,
rnd all other sums p3yable by Lessee to Lessor hereunder, the said deposits shall
be returned in full to Lessee at the end of the term of this Lease, or upon the
earlier termination of tn:s Lease as herein provided.
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7. MAINTENANCE AND REPAIR
7.1 LESSEE'S OBLIGATION TO MAINTAIN AND REPAIR
Lessee expressly agrees to maintain and keep, at its sole cost
and expense, the Premises and all improvements of whatever kind that may be now
erected thereon, or hereafter erected, installed, or otherwise made thereon by
Lessee in a safe, clean, wholesome and sanitary condition, and agrees to make
all necessary repairs and alterations thereto. Lessee shall further make any
and all necessary repairs to or replacement of any equipment, structures, or
other physical improvements on the Premises, to comply with any and all applicable
regulations, laws or ordinances of the State of California, County of Los Angeles,
or other governmental body. Lessee further shall provide proper containers for
trash and garbage and keep the Premises at all times free and clear of rubbish,
debris and 1 itter. Lessee shall not be obligated to repair, maintain, or replace
pier pilings or understructure except as provided for in Article 16.
7.2 LESSOR'S OBLIGATION TO MAINTAIN AND REPAIR
(a) Except as otherwise provided in this Lease, Lessor shall
not at any time be required to make any improvements or repairs whatsoever.
except that lessor may at its sole discretion do any necessary improvements
or repairs to protect the Premises or adjoining premises, in or about the Santa
Monica Pier and Harbor Area. To the extent that the hereinafter mentioned
maintenance services are reasonably necessary and legally and economically
practicable, Lessor shall continue to provide the following maintenance services:
containers for public trash and removal of rubbish, debris and litter from
common areas, lighting of publ ic areas, and provision of publ ic restroom facil-
ities.
(b) Lessor shall, in the event that the improvement and main-
tenance of pier pilings and understructure are reasonably necessary, and in the
event that funds are available from pier revenues or any specified fund that
may be established for the improvement and maintenance of the Santa Monica Pier,
continue to repa,r, maintain or replace pier pilings and understructure.
(c) In the event that Lessor does not repair, maintain, or
replace pier pilings or understructure as provided in Paragraph 7.2, and in the
event that lack thereof materially affects the condition of the Premises, or
materially affects Lessee's business operations, the Lessee may at its option,
terminate this Lease upon giving thirty (30) days prior written notice in accord-
ance with paragraph 7.4. Lessee shall be entitled to receive a refund of all
deposits for security, or otherwise, less any unpaid and accrued rental.
7.3 LESSOR'S RIGHT OF ENTRY AND REPAIR
Lessor reserves the right to enter upon the Premises or any portion
thereof, from time to time, for the purpose of inspecting any facilities owned,
operated, or controlled by Lessor, or for the purposes of making any such repairs
or improvements that are undertaken by Lessor at its sole discretion, which are
in the opinion of the Lessor necessary to the continued maintenance or repair of
the Santa Monica Pier and Harbor Area. Excepting for emergencies to preserve
or protect the public health, safety, welfare or any publ ic purpose, Lessor shail
give the Lessee three (3) days notice prior to exercising the right to enter
upon the Premises for the purposes of making any of said repairs or improvements,
but no such notice shall be reqUired when the Lessor exercises the right to enter
for the purpose of inspecting said facilities.
7.4 LIMITATIONS ON LESSOR'S OBLIGATION TO REPAIR
EXCEpt as otherwise expressly provided in thiS Lease, Lessor
shall have no duty, obligation, or liability whatever to care for or Maintain
the Premises. In the event that, by any express provision of this Lease, Lessor
agrees to care for or maintain the whole or any part of the Premises, such agree-
ment on the part of the Lessor shall constitute a covenant only, and no obi igation
or 1 iabil Ity whatsoever shall exist on the part of the Lessor unto Lessee by
reason thereof unless Lessor fails to commence performance of such obi igatlon
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in reasonable diligence aiter receipt of a written notice of Lessee specifying
(a) the provision of this Lease whereunder said duty is claimed to exist on
the part of Lessor, and (b) facts existing requiring the performance of such
duty.
8. REMOVAL OF DEBRIS
Lessee, at its sole cost and expense, shall remove all debris, shoaling,
or submerged craft from the water area of the Premises which may obstruct water
traffic and otherwise interfere with the use of any water lease hereunder, if
such debris, shoaling, or submerged craft resulted from or was caused by the
actions of said Lessee, its agents, servants, employees, sublessees, concession-
aires or 1 icensees. If Lessee fails to commence the removal of such debris,
shoaling, or submerged craft within ten (10) days after receipt of notice thereof
from Lessor, or thereafter fails to prosecute diligently said removal to camp let ion,
Lessor may remove the debris, shoaling, or submerged craft and use so much of the
security deposit referred to in Article 6 in the Lease, up to the whole thereof,
as is necessary to cover the costs of removing such debris, shoal ing, or submerged
craft. In the event said security deposit is not sufficient to cover said costs,
Less-ee sha II immediately pay the amount by which said costs exceed said security
deposits upon receiving notification from Lessor.
9. SURRENDER OF LEASED PREMISES
9.1 LESSEEIS OBL1GATJON TO SURRENDER UPON EXPIRATION
Lessee hereby covenants and agrees that upon the expiration of
the basic Lease Term, or the renewal thereof, whichever event shall I as t occu r ,
it shall forthwith quit and surrender unto Lessor the Premises and all buildings,
structures, installments, and other improvements thereon in good and clean
condition so as to leave the Premises and said buildings, structures, ins ta II at ions,
and other improvements in substantially the same condition as when first occupied
by Lessee, reasonable wear and tear excepted.
9.2 S~RRENOER OF IMPROVEMENTS
Upon termination, whether by the expiration of the basic Lease
Term, the renewal thereof, cancellation for good cause, forfeiture or otherwise,
title to said buildings, structures, installations, and other improvements
installed by Lessee shall vest in Lessor and shal I become the absolute property
of Lessor without compensation therefore to Lessee. All said buildings, struc-
tures, instal lations and improvements shall remain and be surrendered to Lessor
in good and serviceable condition with the Premises as part thereof, reasonable
wear and tear excepted. Lessee agrees to execute any and all documents necessary
to transfer title to lessor to said buildings. structures, installations, and
other improvements.
~otwithstanding the foregoing, Lessee, if not in default, shalf
have the right at its option. to remove a I I its personal property, trade fixtures,
light fixtures and other items installed and paid for by Lessee. In the event
that any damage is caused to said Premises by the removal of said property,
Lessee shall repair said damage at its own expense.
In the event that Lessee is in default under the terms of this
Lease, Lessor may, at its option, retain Lessee's property pending the cure of
the default.
10. TITLE A~D WARRENTIES
Lessee acknowledges that the PreMises are subject to trusts, covenants,
conditions, easements and restrictions of record. lessor warrants tha t it has
the authority to lease the Premises to Lessee for uses not inconSIstent With the
trust under which the Premises are held by Lessor pursuant to the Grants from
the State of California. Lessor and Lessee agree and acknowledge that no
warranties, covenants, promises or representations as to the title, possession
or use of the Premises are made by Lessor in thiS Lease or in any other form
or manner, except as provided herein in Article 10. It IS expressly agreed and
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understood that notwithstanding any provisions in this Lease to the contrary,
in the event that the tenancy hereunder is or becomes inconsistent with the
trust under which the Premises are held by Lessor pursuant to the Grant from
the State of Cal ifornia, rights and obI igations of the parties will be governed
solely and exclusIvely by the applicable laws of the State of Car ifornia.
11. ENCUMBRANCE OF LEASEHOLD
Prior to making any I ien or encumbrance on the leasehold interest,
excluding trade fixtures, Lessee must submit to Lessor the proposed terms and
conditions of said lien or encumbrance, setting forth the total amount thereof,
the interest rate, the schedules and description of the security for the repayment
thereof, The prior written consent of Lessor must be had and obtained before the
LeSsee may, at any time, encumber the leasehold interest, excluding trade fixtures,
by deed of trust, mortgage, or other security instrument; but no such encumbrance
shall constitute a lien on tbe fee title of Lessor.
12. HOLD HARMLESS AND INSURANCE
12.1 EXCULPATORY CLAUSE AND INDEMNIFICATION OF lESSOR
This Lease is made on the express condition that Lessor is to
be free from all liabil ity or loss by reason of injury to person or property,
from whatever cause, while in or on the Premises, or in any way connected with
the Premises or with the improvements or the personal property therein or thereon
including, but not by way of limitation, any liability for injury to the person
or property of lessee, his agents, officers, and employees. Lessee hereby
covenants and agrees to, and shall, indemnify Lessor and save it harmless from
any and all I iabi I ity, loss, costs, or obi igations on account of, or arising out
of, any such injuries or losses however occurring.
12.2 WAIVER OF CLAIMS
Lessee, as a material part of the consideration of this Lease,
hereby waives all claims against Lessor for damages to goods, wares, merchandise,
bu i I d i "9S , installations or other improvements in, upon, or about the Premises
and for Injuries to Lessee, his agents or employees, or persons in or about the
Premises from any cause arising at any time, including, but not by way of limita-
tion, damages, costs, and liabil ity, of any kind or nature whatsoever, arising
from the total or partial destruction, deterioration, or collapse of any pier
in and about the Santa Monica Pier and Harbor Area, Lessee will hold Lessor
exempt and harmless from any damages or injury to any person, or to the goods,
wares, merchandise, watercraft, facilities, or other property of any person
arising from the use of the Premises by Lessee or from the failure of lessee to
keep the Premises in good condition and repair, as herein provided, when such
damage or injury shall be caused in part or in whole by the negligence or fault
of, or omission of any duty with respect to the same by Lessee. Lessee further
expressly waives all rights under Section 1542 of the CiVil Code of California
as It now provides or may hereafter be amended. Section 1542 reads as fol lows:
"A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at
the time of executing the release, which if known by him
must have materially affected his settlement with the debtor."
12.3 ACCEPTANCE OF PREMISES IN PRESENT CONDITION
The Lessee accepts the Premises, piers, buildings, structures,
installations, and other Improvements on the Premises in their present condition,
as is, and without any representation or warranty by the Lessor as to the condi-
tion of such, or as to the use or occupancy which may be made thereof and the
Lessor shall not be responSible for any latent defect or change of condition in
the Premises, piers, buildings, structures, installations, or improvements thereon,
or for any change in their condition, Or for any damage occurring thereto, or
because of the existence of any violations of any state, county, or municipal
laws.
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12.4 INSURANCE HAZARDS PROHIBITED
Lessee shall not commit or permit any act or acts in or on the
Premises or use the Premises or suffer them to be used In any manner which
will increase the existing fire, liability, and other insurance rates on the
Premises, buildings, or improvements thereon, or which will cause a cancellation
of any insurance polley covering said Premises. said buildings, or any said
improvements thereon. Lessee shall not keep, hold, store, use or sell in or
On the Premises any product or article prohibited by any insurance polrcy,
as it now exists or may hereafter provide covering the said Premises, bUildings,
or any improvements thereon, Or permit or suffer any such product or article
to be kept, held, stored, used, or sold in or on the Premises. Lessee sha 11
comply with any and all requirements necessary for the maintenance of public
liability insurance covering the said Premises, buildings, Or other improvements
and appurtenances.
12.5 PUBLIC LIABILITY AND PROPERTY DAMAGE INSURANCE
Additionally to and independently of all other provisions of
this Lease, Lessee shall, at its own cost and expense, forthwith after the
execution hereof, procure a policy or pol icies of Comprehensive General Liabil ity
Bodily Injury and Property Damage insurance with Contractual Liabi I ity and
Products and Completed Operations coverage. Such pol icy or pol icies shall be
issued with per occurrence limits of not less than $300,000.00 Combined Single
Limit, issued by insurers either approved in writing by Lessor or rated in
Best's as "Triple AIL or better, whereof Lessor shall be the named or additionally
named insured. The terms of said pol icies may be for such period as shall be
designated by Lessee; provided, however, that within two (2) months prior to
the expiration of such insurance terms, Lessee shall procure other pol icies of
said insurance so that between the execution of this Lease and the commencement
of the Lease Term, and throughout the entire Lease Term or any renewal thereof,
or until the sooner termination hereof, Lessor shall always be a named aaditional
insured under the policies of comprehensive public liability and property damage
insu rance in accordance With the foregoing. Certificate of said insurance,
together with the receipts for the payment of premiums for the terms thereof,
shall be del ivered to Lessor within ten (IO) days after the execution of thiS
Lease, and, thereafter within thirty (30) days prior to the expiration of the
term of each such policy. Said policies shall contain a non-cancellatlon-
without-notice clause and shal I provide that copies of all cancellation notices
shall be sent to Lessor.
12.6 WORKMEN'S COMPENSATION INSURANCE
Lessee shall procure, at his own expense, and shall keep in
force during the Lease Term, adequate insurance against 1 iability arising on
account of injuries or death to workmen or employees on the Premises or any
installation or improvements of Lessee. Such workmen's compensation insurance
to be provided by Lessee shall be in the maximum amounts obtainable against
I lability under the Workmen's Compensation Insurance and Safety Act of the State
of Cal ifornia.
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13. ASSIGNMENT O~ SUBLETTING
13.1 RESTRICTIOtlS Ot~ ASSIGNMENT OR SUBLETTING
Lessee shall not assign, encumber, or otherwise transfer this Lease,
or any right or interest hereunder, or in or to any of the improvements or appur-
tenances, excluding trade fixtures, that hereafter may be constructed or Installed
on the Premises, and Lessee shall not sublet the Premises, improvements, or appur-
tenances in whole or in part without the prior written consent and approval of
Lessor. For purposes of this Article 13, assignment and transfer shall include,
but not be limited to, any transfer of common or preferred stock, assignment for
benefit of creditors, or otherwise. No such assignment, encumbrance or other trans-
fer, whether voluntary or involuntary, by operation of law. under legal process,
through receivership or bankruptcy, or otherwise, and no such subletting shall be
val id or effective without such prior written consent and approval. Any consent to
one assignment, subletting encumbrance. or other transfer of interest shall not be
deemed to be a consent to any subsequent assignment, subletting, encumbrance, or
t~ansfer of interest, and Lessor's consent will not unreasonably be withheld. In
granting its consent, Lessor shal I have the right to impose upon the assignee, sub-
lessee, encumbrancer, or transferee as condition to its consent, written compl lance
to all terms. covenants, conditions and agreements in this Lease.
13.2 TERMINATION
Should Lessee make or suffer to be made any such assignment, sub-
letting, encumbrance, or transfer, exceot with Lessor's consent, thereupon Lessor
may, at its option, terminate this Lease forthwith by written notIce, and upon
such termination this Lease shall cease and be of no further force or effect except
as hereinafter otherwise provided.
13.3 EFFECT OF LESSOR'S CONSENT
Should lessor consent to any such assiQnment, sublettlng, encum-
brance, or transfer, none of the restrictions of this Lease shall be thereby
waived, but the same shall apply to each successive assignment, subletting,
encumbrance, or transfer hereunder, if any, and shall be separately binding upon
each and every assignee, sublessee, encumbrancer, transferee, and other successor
in interest of Lessee.
13.4 WRITTEN ASSUMPTION AGREEMENT
In the event that Lessor gives consent and approval to any transfer
or assignment, and before such transfer or assIgnment becomes effective for any
purpose, the transferees and assignees must. in writing, assume all obligations of
this Lease and agree to be bound by all terms of the Lease. Except in the case
of a valid assignment, and only in such case, said written assumption agreement
shall not in any way limit, release Dr discharge the original Lessee from any
I iability under any provision of this Lease.
13.5 TRANSFER ON TERMINATION
Unless Lessor elects, at its option and in its sole discretion, to
continue approved subleases,. the termination of this Lease prior to the expiration
of the Lease Term shall serve to cancel approved subleases. In the event that
Lessor elects, at ItS option and in its sole discretion to continue any approved
subleases, a termination of this Lease prior to the explr~tion of the Lease Term
shall operate as an assignment to Lessor of any such subleases and al I rights of
Lessee thereunder sMa] I termInate and shall pass to Lessor. Lessor may, at its
option and in its sole discretion, transfer said subleases to a new Lessee or
otherwise as Lessor deems fit.
14. DEFAULT AND REMEDIES
14. I DEFAULT
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Not by way of 1 imitation, the following shall be deemed a default
by Lessee and a breach of this Lease:
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(a) Failure to payor cause to be paid any tax, assessment,
insurance premium, lien, claim, charge, or demand herein provided to be paid or
caused to be paid by Lessee at the times and in the manner herein provided;
(b) Defaults In the payment of any installment of rent or any
other sum when due as herein provided;
(c) Failure to commence or to complete the construction, repa I r,
restoration or replacement of the building and other improvements in or ,about the
Premises within the times and in the manner herein provided;
(d) Failure to commence and thereafter to continuously conduct its
operation thereon within the times and the manner herein provided;
(e) Failure to use, maintain, and operate the Premises as herein
reqUired, or abandon the Premises;
(f) Defaul t in the performance or breach of any other covenant,
condition, or restriction of this Lease herein provided to be kept or performed
by Lessee.
14.2 LESSOR'S ELECTION
Upon occurrence of any of the following:
(a) If Lessee's interest, or any part of its interest, in this
Lease is assigned or transferred, either voluntarily or by operation of law,
except with Lessor's prior written consent had and obtained; or .",
j I
(b) A voluntary petition in bankruptcy or for reorganization or
for an arrangement is filed by Lessee, if Lessee is a sole proprietor or corporation,
or is filed by any member of Lessee, if Lessee is a partnership or Joint venture;
or If
(c) Lessee or any member of Lessee, if Lessee is a partnership
or a joint venture, is adjudicated, bankrupt or insolvent or makes a general or
other assignment for the benefit of creditors or app! ies for receivership or a
trusteeship; or if
(d) Lessee fails within sixty (60) days of receipt of written
notice from Lessor to obtain dismissal of a, petition in bankruptcy or for reorgani-
zation or for an arrangement filed against any member of Lessee, if Lessee is a
partnership or jOint venture; or if
(e) Lessee fails within sixty (60) days of receipt of written
notice from Lessor to obtain dismissal of the app! Ication of a creditor for the
appointment of a receiver or trustee of the business or the assets of Lessee, or
of any member of Lessee if Lessee IS a partnership or jOint venture, except a
receiver or trustee appointed at the instance or request of Lessor; of if
(f) Lessee fails Within ten (lO)daysofreceiptofwrltten notice from
lessor to remedy any default in the payment of any sum, including but not limited
to, payment of the minimum annual rental, the additional percentage rental. late
payment penalty, or any deficiency of any security deposit due under this Lease;
of if
(9) Lessee fails within thirty (30) days of receipt of written
notice from Lessor to remedy any other default or to ~eep any other covenant or
condition of this Lease; then, in addition to any other remedy, Lessor mav have
under the laws of the State of California, County of Los Angeles, or any other
governmental body,
(1) Declare th,s Lease, and all rights and interests created
by it. to be terminated, in which event lessee shal I Immediately pay Lessor a sum
of l110ney equal to the amount, if any, by which the then cash value of the re~t
reserved under thiS Lease for the balance of the Lease Term exceeds the tnen
reasonable cash rental value of the Premises for the balance of the Lease Term; or
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(2) Without terminating this Lease, relet the Premises, or
any part of the Premises, as the agent and for the account of lessee upon such terms
and conditions as Lessor may deem advisable, in which event the rent received on such
reletting shall be applied first to the expenses of such reletting and collection,
including necessary renovation and alterations of the Premises, reasonable attorneys'
fees, any real estate commissions paid, and thereafter to payment of all sums due
or to become due Lessor under this Lease, and if a sufficient sum sha1 I not be
real ized to pay such sums and other charges, Lessee shall pay Lessor any defiCiency,
notwithstanding Lessor may have received rental in excess of the rental stipulated
to in this Lease in previous or subsequent months, and Lessor may bring an action
therefor as such monthly deficiencies shall arise. Lessor shall in no event be
r iable in any way whatsoever for failure to relet the Premises or in the event
that the Premises are relet, for failure to collect the rent thereof under such
reletting.
(3) At the option of the Lessor, without terminating this
Lease, the Lessor may elect to enter the Premises for the purpose of removing,
sell ing, removing and selling, or destroying some or all of any buildings, structures,
instal lations, and other improvements placed on and about the Premises without the
prior written consent of Lessor, or to enter upon the Premises, or any portion
thereof, for the purpose of performing Lessee's obl igation and duty to repair, keep,
and maintain the Premises pursuant to Paragraph 7.1 of the Lease hereinabove. Such
removing, selling, removing and selling, or destroying some or all of the said
unauthorized buildings, structures, installations. or other imorovement, or any other
such repairing, or maintenance, may be done on Lessee's account, and Lessee shall
pay to Lessor the reasonable costs of such removal, sale, removal and sale. or
destruction, and any such repairing, or maintaining.
(4) At the option of the Lessor, without terminating this
Lease, the Lessor may elect to have the Lease continue in effect for the Lease Term
so long as the Lessor does not terminate the Lessee's right to possession, and
Lessor may enforce all of the rights and remedies under this Lease including, but
not by wa? of limitation, his right to recover from Lessee the rent as it becomes
due hereun de r.
..
(5) At the option of the Lessor, the Lessor may elect any
other remedy provided for in this Lease and by law under the laws or the State of
Ca I i ro rn i a, County or Los Angeles, or other governmental body.
14.3 CUMULATIVE REMEDIES
Any termination of this Lease as herein provided shal 1 net relieve
Lessee from the payment of any sum or sums that shall then be due and payable to
Lessor hereunder or any claim ror damages then or theretofore accruing against
Lessee hereunder and any such termination shall not prevent Lessor rrom enforcing
the payment of any such sum or sums or claim for damages by any remedy prOVided
ror by law, or from recovering damages from Lessee for any default thereunder. All
rights, options, and remedies of Lessor contlned in this Lease shall be construed
and held to be cumulative, and no one or them shall be exclUSive or the other, and
Lessor sha 11 have the right to anyone or all such remedies or any other remedy
or re1 ier which may be provided by law, whether or not stated in this Lease.
14.4 WAIVER
The waiver by Lessor of any breach of any term, covenant, or condi-
tion herein contained shal I not be deemed to be a waiver of such term, covenant, or
condition or any subsequent breach of the same or any other term, covenant, or
condition herein contained. The subsequent acceptance of rent ~ereunder by Lessor
shall not be deemed to be a waiver of any prior occurring breach by Lessee or any
term, covenant, or condition of this Lease, other than the failure of Lessee to
pay a particular rental so accepted, regardless or Lessor's ~nowledge of such prior
existing breach at tre time of acceptance of suc~ rent.
14.5 RIGHT OF RE-ENTRY
Any such right of re-entry reserved uncer Paragraph 14.2 of thiS
Lease shall be al lowed by Lessee Without hindrance, and Lessor shall not be l,able
In damages for any such re-entry, or be guilty of trespassing or forceable entry.
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14.6 PERCENTAGE RENTAL UPON DEFAULT
For the purposes of Paragraph 14.1, the percentage rental for any
period after such default by Lessee and entry by Lessor shall be at a monthly rate
equa! to the average mont,ly percentage rental which Lessee was obI igated to pay
Lessor during the preceding year, except that if such event shall occur during the
first year of the Lease Term, t~en at a rate for the then elapsed portion of the
Lease Term.
14.7 LESSOR'S R!GHT TO CURE DEFAULT
In the event of Lessee's breach or default of any term, covenant
or condition of this Lease, Lessor may at any time, without notice, except as
otherwise provided in this Lease, cure such breach for the account and at the expense
of Lessee. If the Lessor at any time, by reason of such breach or default, is
compelled to pay, or elects to pay, any sum of money or to do any act that will
require the payment of any sum of money, or is compelled to incur any expense,
including reasonable attorneys' fees, in instituting, prosecuting, or defending any
actions or proceedings to enforce Lessor's rights under this Lease or otherWise,
the sum or sums to be paid by Lessor, with all interests, costs, and damages, shall
be due from lessee to lessor on the first day of the month following the incurrlng
of such expenses.
15. CONDEMNA T1 ON
In the event of any taking of the Premises under the laws of eminent domain,
rent liabil ity and disposition of award shall be determined in accordance with the
laws of the State of California then in effect.
1&. DAMAGE OR DESTRUCTION
16.1 PARTI~L DESTRUCTION OF PREMISES
In the event of a partial destruction of the leased Premises, Lesser
shall rebui ld, repair, or restOre the same to substantially the original condition,
provided however that Lessee shall be I iable to Lessor for al I damages resulting
from such destruction caused by Lessee's negl igence or the negligence of its agents,
servants, employees, sublessees, concessionaires or ) icensees. Lessee further
expressly waives the provisions of Section 1932, Subdivision 2, and Seclon 1933,
Subdivision 4 of the Civil Code of California. As used herein, "oartial destruction"
means any destruction of fifteen percent (15%) or less of the replacement value of
the Premises.
16.2 MATERIAL DESTRUCTION OF PREMISES
In the event of a material destruction of the leased Premises,
Lessor may elect, at its OPtion and In ItS soJe discretion, to rebu j I d, repair, or
restore the Same to substantial ly the original condition, or Lessor shall elect to
allow the Lessee to rebuild, repair, or restore the sa~e, at Lessee's sole cost and
expense, to substantially the original condition, in which case Lesser and Lessee
may elect to amend or revise this Lease. In the event t~at neither the Lessor nor
lessee rebu i r ds, repairs, or restores the Pre~ises, pursuant to the options stated
hereinabove, the Lease shall terminate and the parties hereto shall thereafter be
released from al I obl igatlons accruing hereunder, provided, however, that Lessee
shall be liable to Lessor for all damages resulting from such destruction caused
by Lessee's negl igence or the negJ igence of Its agents, servants, employees.
sublessees, concessionaires, or J i censees . As used herein, "material damage"
means any destruction in excess of fifteen percent (15%) of the replacement value
of the Premises.
16.3 COM~ENCEME~T AND COMPLETION OF RESTORATION
In the event that Lessee rebulids, repa I rs, or restores the Premises
pursuant to Paragraph 16.2 above, Lessee shall, within thirty (30) days of receipt
of notification by Lessor to commence, submit to Lessor plans for the restoration
of the Premises. Lessee sha 11 , furthermore, complete said restoration with due
dll igence to permit full use and occupancy of the Premises for the purposes reqUired
by this Lease, but in any event, no longer t~an six (6) months from the date or
issuance of a valid bui ldl~g permit.
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16.4 RENT UPON DESTRUCTION
Unless terminated pursuant to Paragraph 16.2 above, any such
destruction, whether partiar or material, shall not annul or void this Lease,
except that Lessee shall be entitled to a credit aqainst the minimum annual
rental payable of 1/365th of said rental for each day following said destruction
during which the Premises are totally unusuable for Lessee's purposes, provided,
however, that if Lessee restores pursuant to Paragraph 16.2, said rent abatement
shall in no event extend beyond the date specified in Paragraph 16.3 for the
completion of said restoration.
17. ABANDONMENT
Lessee shall not abandon Premises anytime during the Lease Term, or any
renewal thereof; and If Lessee shall abandon the Premises or be dispossessed by
process of law or otherwise, any personal property belonging to Lessee and left on
the Premises, or in any building, structure, or any improvements made by Lessee on
the Premises, shall, at the option of Lessor, be deemed to have been abandoned.
Upon abandonment by Lessee, Lessee agrees that Lessor has the right, at its option,
to re-enter and relat the Premises for the account of the Lessee and that such
action shall not be construed as a consent to the surrender of the Lease unless
written notice of this intent is given to Lessee.
18. COMPLIANCE WITH LAWS
Lessee agrees to and shall maintain and conduct his business in a lawful
manner, and agrees to and shall comply promptly with all federal, state and
muniCipal statutes and ordinances, and with all regulations, orders, and directions
of appropriate governmental agencies as such statutes, ordinances, regulations,
orders, and directives now exist or may hereafter provide concerning the use and
safety of the Premises, and, at his sole expense, make any repairs, changes, or
modifications in, on, or to the Lease Premises required by any of the foregoing.
The duties and obl fgations imposed upon Lessee in this Article 18 are not.appl fcable
to the Pier Structure, unless any such repairs, changes, or ~dificatrons in, on,
or to the Pier Structure are required due to the want of ordinary care of the
lessee, his agents, servants, or employees.
19. SUPERVISION AND CONDUCT OF LESSEE'S EMPLOYEES
Lessee warrants, promises, and covenants that the Premises or any buildi~gs,
structures, installations or improvements of Lessee situated thereon sha! I be
personally supervised by competent personnel who shall have the capacity and power
to act on behalf of Lessee. Upon good cause, Lessor shall have the right to require
the discharge by Lessee of any employee of Lessee or of Lessee's agents, sublessees,
concessionaires or licensees, whose conduct is determined by Lessor to be detri-
mental to the public interest.
20. OPERATIONS AND CHARGES
20. t HOURS OF BUSINESS
Lessee shall continuously during the entire lease Term conduct and
carryon lessee's business on the Premises and shall keep said Premises open for
business and cause such business to be conducted thereon for such number of hours
as is customary for businesses of like character on the Santa Monica Pier and other
small boat harbors of Southern California, described more particularly in Exhibit "0".
20.2 FEES AND CHARGES
Lessee shall at all times carry in Its business on t~e Prem'ses a
stock of goods, wares, and merchandise of such size, character and qual !ty and shal I
render such services as fs reasonably deSignated to produce the ~axlmum return to
Lessee and t~e greatest amount of rent to Lessor. The fees, charges and prices of
all goods, wares, and merchandise sold or leased and all services rendered by any
business, concession or activities conducted on the Premises shall be reasonable
and in fair competition With prevail ing prices, fees and charges c~arged by compar-
able establ ishments for 1 ike goods, wares, merchandise or services 'n the said City
of Santa Monica or in other small boat harbors of Southern Cal ifor~ia. Lessor
reserves the right to Inspect all schedules of prices, fees and charges Whenever
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the Lessor determines that any such fees, charges or prices are unreasonable, or
are not in conformity with the prevailing competitive prices in comparable establ ish-
ments, it may, by written notice to Lessee in the manner provided herein, requ i re
such adjustments to be made which will cause such fees, charges or prices to be
fair and reasonable or competitive.
20.3 BINDING ON AGENTS, SUBLESSEES, CONCESSIONAIRES, AND LICENSEES
The Provisions of Paragraph 20.1 and 20.2 shall be binding upon all
agents, sublessees, concessionaires, and licensees of Lessee.
21. TAXES
21.1 TAXES AND ASSESSMENTS
In addition to the foregoing sums, Lessee shall, as further considera-
tion for this Lease, pay and discharge all taxes, general and special assessments
and other charges of every description which during the term of this Lease may be
levied on or assessed against the Premises and all interests therein and all improve-
ments and other property thereon, whether belonqlng to Lessor or to Lessee, or to
which either of them may become liable in relation thereto. Lessee sha 11 further
payor cause to be paid any fees imposed by law for licenses or permits for any
business or activity of Lessee, 5ublessees, concessionaires, or licensees upon or
in connection with the Premises or under this Lease.
21.2 HOLD HARMLESS CLAUSE
Lessee agrees to and shall protect and hold harmless Lessor in the
Premises from I iabil Ity from any and all such taxes, assessments, and charges
together with any interest, penalties, or other sums thereby imposed and from any
sale or other proceeding to enforce payment thereof.
21. 3 SEPARATE ASSESSMENTS OF REAL AND PERSONAL PROPERTY
During the Lease Term, or any extension thereof, Lessee shall cause
all taxes, assessments, and other charges levied on or imposed on any of his personal
properties situated on, or about the Premises to be levied on or assessed separately
from the Premises and not as alien thereon.
21. 4 TIME OF PAYMENT
Lessee agrees to and shall pay all such foregoing taxes, assessments,
and charges not less than seven (7) days prior to the date of delinquency thereor.
21.5 PAYMENT BY LESSOR ON LESSEE'S DEFAULT
Should Lessee fail to pay any such taxes, assessments, or charges
as herein provided, Lessor may, at its option, at any time pay such taxes, assess-
ments, or charges together with al I penalties nr interests which may have been
added thereto by reason of Lessee's delinquency or default, and may 1 ,kewise redeen
the Premises, or any part thereof, or the buildings, structures, installments or
improvements thereon from any tax sale or sales. Any such amount so paid by Lessor
shall become immediately due and payable as rent by Lessee to Lessor, together with
interest thereon at the rate of seven percent (]%) per annum from the date of payment
by Lessor unt i 1 paid by Lessee. Any such paynent by Lessor shall not be deemed to
be a waiver of any other rights which Lessor may have under the provisions of thiS
Lease or as provided by law.
22. LESSEE'S ASSOCIATION
Lessee agrees to pay and maintain me~bersh,? .n any organization that 's
now or ~ay be organ;z~d, formed or sponsored by Lesser for all business on the
Santa Monica Pier and to pay such organization as membership fees therein such
amounts, jf any, as may be establIshed for the period In question by membership. to
be used (except for reasonable administrative expenses) at the directIon of the
~embership thereof for the sole purpose of promotion of said Pier The bv 1 aws to
be adopted by such organization, for the ~urDose of t~is Article 22, and any ame~d-
ments t~e"eto, ~ust be aporoved by Lessor and a ~aJorlty of Lessees the~ hOldIng
Leases on said Pier.
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e .
Annua 1 dues to be paid ~y Lessee as a member of the Lessee's Association
shall in no event be less than rour percent {4%) nor more than ten percent (10%)
or the ~inimum annual rent of each Lessee. Lessor sha 11 contribute to said Lessee's
AssoCiation an amount equal to the actual contribution of the Lessee, provided,
however, that said contribution by Lessor shall in no event exceed ten percent (10%)
or the minimum annual rent provided in this Lease. Said contribution by Lessor
sha II in no event be expended by said Lessee's Association for any purpose other
than promotion of said Pier.
23. ~ASTES; NUISANCE; UNLAWFUL USE PROHIBITED
Lessee shall not commit, or surfer to be committed, any wastes on the
P rero i ses nor sha 11 lessee maintain, permit or suffer the maintenance or commission
or any nuisance on the Premises or use, or permit the use of the Prem,ses for any
unlawful purpose.
24. HOLDING OVER
In the event that Lessee shall hold over after expiration or the Lease
Term, or any extension thereof, with the consent, express or implied, of Lessor,
such holding over shall be deemed merely a tenancy rrom month-to-month, at the
monthly rental then in effect, and shall otherwise be on the same terms, covenants,
and conditions as so far applicable, until such tenancy is terminated in a manner
prescribed by law.
25. NOTICE FOR PROCESS
25.1 NOT! CES
All notices, demands, requests, or approvals which are required
under this Lease or which either Lessor or Lessee may desire to serve upon the
other, sha 1 r he In writing and shall be conclusively deemed served when delivered
personally, or forty-eight (48) hours after the deposit thereof in the United
States mail, postage prepaid. registered or certified, addresse~ as hereinafter
provided.
25.2 NOTICES TO LESSOR
All notices, demands, requests, or approvals from Lessee to Lessor
shall be addressed to the Pier Manager at 1685 Main Street, Santa Mon i ca, Ca 1 i forn i a
90401.
25.3 NOrlCES TO LESSEE
All notices, demands, requests, or approvals from Lessor to Lessee
shall be given to Lessee at 7325 The Prcmanade 1407 Santa Monlca C:1\, q(J4111
25.4 CHANGE OF ADDRESS
Each party shall have the right, from time-to-time, to designate a
different address by rtotice given in conformity with this Paragraph.
25.5 MU~ TfPLE PARTI ES
If more than one Lessee is named In thiS Lease, service of any
notice on any of the Lessees shall be deemed service on ail the Lessees, respectively.
25.6 SERVICE OF PROCESS
If Lessee is not a res,dent of the State of Cal ifornia or I s an
association or parcnership without a memoe~ or ~artner present In the said state,
or is a foreign corporation, Lessee shall file with Lessor a designation of a
natural person reSiding in the County of Los 4ngeles, State or Cal [fornia, glVI'g
his name, residence, and business address as the agent of Lessee for the servi~e
of written notice Or the service of process in any court action between Lessor
and Lessee, arising out of or based upon this Lease, and t~e del ; very to Such
. ,
-'0-
~
e e
agent of such written notice or a copy of any orocess In such action shal I constitute
a val id service upon Lessee.
If for any reason, service of such written notice or such process upon
such agent is not possible, then Lessee may be personally served with suc, written
notice or process outside the State of Cal ifornia and such service Will constitute
val id service upon Lessee; and it is further expressly agreed that Lessee is
amenable to such process and submits to the jurisdiction of the court so acquired
and waives any and all objection and protest thereto.
26. GENERAL PROVISIONS
26.1 CONDITIONS AND COVENANTS
Unless expressry indicated otherwise, all of the provisions of thiS
Lease shall be deemed as running with the land and construed to be "conditions"
as well as "covenants" as though the words specifically expressing or imparting
covenant and conditions were used in eac~ separate provision.
26.2 P~ESUMPTION THAT PREMISES ABANDONED
tn the event that Lessee shall be absent from the Premises for a
period of thirty (30) days after default in payment of rent or other ob1 igations
imposed upon them by this Lease, such absence shall be deemed to be an abandonment
of Lessee's interest in the Premises and an abandonment by him of any personal
property left on the Premises and lessor may thereuDon re-enter the Premises as
hereinbefore prOVided.
26.3 TIME OF ESSENCE
Time is hereby expressly decla~ed to be of the essence of this
Lease and all the covenants, agreements, conditions, and obi Igations herein
contained.
26 4 COMPUTATION OF TIME
The time in which any act provided by thiS Lease is to be done is
computed by excluding the first day and ,ncluding the last, unless the last day IS
a Saturday, Sunday or holiday, and then it is also excluded. The term "hol,day"
shall mean all holidays specified in Section 6700 and 6701 of the Government Code
of the State of California.
26.5 CAPT! ONS
Captions of the Articles, Sections and Paragraphs or this Lease
are for convenience and reference only, and the words contained the~eln shall in
no way ~e held to explain, mOdify, amplify, or aid in the interpretation, construction,
o~ meaning of the proviSIons of this Lease.
26.6 ATTORNEY'S FEES
11 the event that any party to th,s Lease shall bring any action
or proceeding to enforce, protect, or establish any ~ight or remedy arls'ng out of
this Lease or any provision thereof, or to recover rents, the prevail iog partv I'
such action or proceeding shall be entitled to recover from the other oarty
reasonable attorney's fees and costs In addition to any ot~e~ re'iledy or jucgment
g~anted by the Court
26.7 TERM INCLUDES EXTENSIONS
All references to t~e te~m of thiS Lease or the Lease ie~m shall
include any exten~'ons of such tern.
26.8 NUM8EP ~~D SE~DER
in this Lease ":he 'leuter gender Includes the femlnl:'le and mascul''1e
and the Singular number inclUdes t"le pl;.;ral, wherever the COntext so requires
-~7-
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26.9 I NTERPRETAT I ON
The language in all parts of this lease shall in all cases be
simplv construed according to its fair ~ean;ng and not strictly for or against
Lessor or lessee.
26.10 MODIFICATION
This lease is not subject to modification except in writing
26.11 ENTIRE AGREEMENT
This lease contains the entire agreement of the parties with
respect to the matters covered by this lease, and no other agreement, statement
or promise made by any party, or to any employee, officer, or agent of any party
which IS not contained in this lease shall be binding or valid.
26.12 PARTIAL INVALIDITY
If any ter~, covenant, condition, or provision IS held by a court
of competent jurisdiction to be Invalid, void, or unenforceable, the remainder of
the provisions shall remain in full force and effect and shall in no way be affected,
impaired, or invalidated.
CITY OF SANTA MONICA
A Municipal Corcoration
by
City Manager
.
lessor
.
Dated:
by
Lessee
Dated
-18-
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~ ~XHI8IT A ~ Page 1
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EXHIBIT B
DESCRIPTION OF PREMISES
That certain portion of the Santa Monica Pier situated at or above
the deckllne, more particularly described as follows, and shown by
the boundary 1 ines in red on the drawing hereto attached and made a
part of this Lease:
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EXHIBIT C
PE~HITTED USES
Said premises shall be used only for the purpose of operating or
running a Small boat rental concess~on. and Motor~zed boat harbor tours
i
and Lessee shall not, without prior written consent of Lessor, sell
or expose for sale, keep or ~~low to be kept in, or have therein
any articles or merchandise of any description other than those
hereinafter set forth, to wit: NONE.
~ e
EXHIBIT 0
HOURS OF BUSINESS
lessee shall, weather permitting, conduct and carryon lessee's
business on tne Premises and shall keep said Premises open for
business and cause such business to be conducted thereon no less
an amount than the hours and days set forth below:
7 A.M. to 6 P.M. seven (7) days per 'Heek May 1 through Septeml:er 30'IH and
7 A.M. to 4 P.M. F~ve (5) days per week October 1 st through Apr ~l 30th
A four ,veek closure w~ll J::e perrru.tted durmg the October - Apnl perlOd.
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4gen~a !te~ ll-E Fresente~ fOT CGnSlcerat~on ~as a renort reco~~eDd:~~
a::::~-::ro\.a: of lease a.sslgnmen: of Joseph '[orTJ.S t dba F1Sh- '.l'Ch~ps, to -
.l,c.'11ral 3<op Bo",., Inc and tne lease of 'ir Robert ~Iorrls dba Sea\"oe',
Seafoo.::., tD \[r and. \1rs Yong Klr.., at Sant.a \-ion1.ca ?~er Counc1-1..,erber
Reed ~oYed to hear me,bers of the Dub12c and wlth~old Coun~il d~Scus51oa
un::il later In the evenlng Telated~ to t~e ExeCutlVe SeSSion (-\genda Ite-.
Il-D~ Secoad by Counc11~ember Rhodep
CouncIl Vote Unaulnously approvec 7-0
~alter Sc~wart= 5no~e ~o request lnvestlgatlon of lease conSlcerat10hJ
Jc~n 3~eddon an~ 30b Silt~erland, the s~blessors repl:ed to GUest:OllS
frc~ the ~cuncll ~fter dlScuss~on, Councl1member leed Teq~ested !~a~
t~e recora re~lect that the ~otent:al suo:esscrs do not oblec~ to tte
~ea.se asslgnre:"1t ::,e::.ng mace out separately to the, 35 lndl\.lGUa:s _ ___
- --- - - -- ------- -
A~enda Ite~ ll-E~ CounCl1~embeT Reed moved to approve the lease aS5~g~-
w~nt of RabeTt ~foTris dba Seavie1'; Seafood to Yang K1f.1 and Hae ';U Kln
bv a~ard of ContTact ~o. 3500(CCS) and to aDprove the lease aS51gnTent o~
J~se-ph "1orTIs dba FISh 1>1\" ChlpS by a',"ard of ContTact \Jo 349~(CCS; to
Pcbe~t Sutherland, Alexandra Su.herland, Jo~n Sneddon and SanGra ~e~gn r,
as :cur 1"1::l1"1C.uals "'jho "'~lll be res[lon:~ilble fOT the lease asslgneTn't c
t';-,e lease to ~e uredlcated upon the- agTeement: prel~lou51y reached bet"'~'e "l.
gt~~= and the~varlous assIgneeS as to the ter~s thereof Seco~d bv
C::June] I.-ember Rl:.oden The notlon was approved bv t~e folloT\l~g vo~e
CouncIl Vo~e Unanl~ouslv approved 4-0
.\b= CT'lt Counc1lnembers Jenn1.ngs, Scott. ar...G vap cie-~.!
_ Steenho"en
---
- -- - - - - --
City Council Meeting-May 28, 1980
NlrNE
ADDR.ESS
ITEN NO. liE
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ADDRESS C -'0,_
I TEN [.;0.
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