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SR-106-025-02 (3) .doc RMD:EDD:DM:F:\RESOURCE\SHARE\STAFFREPORTS\Pier Restoration Corporation City Council Meeting: December 19, 2000 Santa Monica, California To: Mayor and City Council From: City Staff Subject: Recommendation to Authorize the Execution of the Proposed Services Agreement Between the City of Santa Monica and the Santa Monica Pier Restoration Corporation and Approve the Proposed Guidelines for Leasehold Management of City Property on Santa Monica Pier, the Amended and Restated Bylaws of the Santa Monica Pier Restoration Corporation, and the Annual Plan of Work for Fiscal Year 2000-01 by the Santa Monica Pier Restoration Corporation. Introduction This report recommends that Council authorize the execution of the proposed Services Agreement between the City of Santa Monica and the Santa Monica Pier Restoration Corporation (PRC), approve the proposed guidelines for leasehold management of City property on the Santa Monica Pier, and approve the amended and restated Bylaws and Annual Plan of Work for Fiscal Year 2000-01 of the PRC. Background The Santa Monica Pier has been an integral part of the recreational and visitor- serving commercial life of the City for more than ninety years. What is now known as Santa Monica Pier is in actuality two piers built side by side: the Municipal Pier, a public right of way extending Colorado Street built initially in 1908 and replaced in 1921; and the Pleasure Pier built in 1916 which featured the Looff Hippodrome and carousel, as well as a roller coaster, various other 1 entertainment features, restaurants and fish markets. Through the 1920s and 1930s, Santa Monica Pier was a prominent regional entertainment outlet. The commercial popularity of the Pier declined through the 1950s and 1960s, and portions of the wooden pilings and deck structure fell into disrepair. In 1973 City Council authorized its demolition as part of a more comprehensive proposal to create a mixed-use offshore island development project. However, Santa Monica residents recognized the value of the structure as a public recreational asset and responded with a grass-roots initiative that forbade demolition of either the Municipal or the Pleasure Piers. Concerted plans for the Pier’s restoration began in 1981, when City Council appointed the 15-member Pier Restoration and Development Task Force, charged with preparing a comprehensive set of goals, objectives and policy guidelines for the physical, economic and functional improvement of the Pier. The City and the Pier Restoration and Development Task Force entered into an “Interim Agreement for the Development of a General Plan and Contract for the Restoration and Operation of the Santa Monica Pier.” Following a series of public workshops conducted by the Task Force and funded by the State Coastal Conservancy, a 1982 document entitled “Pier Guidelines” was generated containing the general objectives for future development of the Pier. In January 1983, a series of storms severely damaged the Pier, with the loss of more than 100,000 square feet of deck area and significant structural damage to 2 much of the remaining pilings and deck. In November 1983 City Council created the Santa Monica Pier Restoration Corporation (PRC) as a non-profit, public benefit corporation to oversee the reconstruction and revitalization of the Pier and to continue implementation of the “Pier Guidelines.” The responsibilities and authority of the PRC were broadened and formalized in December 1985, with City Council approval of a Services Agreement with the PRC and by-laws for the corporation. In the 1985 Services Agreement, City Council delegated to the PRC the responsibility to develop, implement and maintain various programs for the operation, reconstruction and revitalization of the Pier. Specifically, the PRC was granted authority to negotiate and administer all leases for commercial use of space on the Pier, review and approve plans for tenant improvements, develop and implement a vendor’s program, and serve as liaison between the City and Pier tenants on all lease matters. The PRC had the sole responsibility to negotiate directly with any prospective or existing tenant for purposes consistent with City and coastal zone regulations and an approved General Use and Development Plan, prepare and approve any lease documents and, following PRC approval, submit proposed leases to the City Manager for execution. The PRC was also responsible for collecting rents and other tenant assessments for payment to the City, assisting in the administration of the parking program on the Pier deck as requested by the City; planning and making recommendations on capital improvements and other construction projects benefiting the Pier and subject to the City’s discretion to undertake projects; and 3 developing and implementing various promotional programs to enhance the commercial operation, economic performance and aesthetic quality of the Pier. City Council oversight and review of PRC activities arises through its appointment of members to the PRC Board of Directors, which currently consists of eleven members, and through annual review and approval of the business plan and budget proposed by the PRC. The Plan of Work sets forth the goals and objectives of the PRC for the ensuing fiscal year, and through its allocation of budget resources, the City funds the PRC’s activities and program implementation. Following approval of the 1985 Services Agreement, the PRC inaugurated the Summer Twilight Dance Series, commenced a façade painting and signage improvement program, introduced the Fun Zone concept as a means to increase the entertainment opportunities on the Pier, and sponsored a number of festivals and special events to promote the Pier and Santa Monica as an attractive venue for visitors and residents. Most critically, the PRC formulated a set of public policy statements, goals and objectives for future development and use of property on the Pier. These guidelines were set forth in the General Use and Development Plan adopted by the PRC in September 1987 and approved by City Council in February 1988. The 1988 Plan set forth a multi-step development program for the commercial revitalization of the Pier through attraction of a diversity of products and services 4 offering a broad range of public appeal. The appropriate tenant mix distribution identified in the Plan included retail, restaurant and entertainment/amusement uses. A primary objective of the PRC’s development program was to revitalize the Pier in a manner that preserved its character while serving the future recreational needs of the community and the economic requirements of the City. The Pier’s economic position was to be improved by increasing the commercial area available for lease and improving the quality of products and services offered while preserving it as an affordable destination. The Plan has been sequentially implemented by the PRC through restoration and operation of the Carousel Building, attraction of new restaurant and entertainment leaseholds to the historic Billiards Building, and physical improvements to Playland Arcade. New entertainment, educational and restaurant developments have been secured through leasehold development of Mariasol Restaurant, UCLA Discovery Center, and Pacific Park. All public and private improvements have been performed in accordance with the Design Guidelines, which were prepared as a companion document to the 1988 Plan. Highlights of the 1988 Development Plan and the progress to date toward implementation of the Plan are summarized as follows: ? Total commercial development program on the Pier will consist of approximately 150,000 square feet of leased building and deck area. 5 As of November 1, 2000, total leased commercial area on the Pier consists of 122,870 square feet of building and deck area. ? Diversity of products and services offered on the Pier will appeal to a broad range of incomes, ages and lifestyles. The adopted tenant distribution was 40% amusements, 40% dining and music entertainment venues and 20% retail. As of November 1, 2000, the Pier tenant mix is 61% amusements, 35% dining and music entertainment venues, 1% retail and 4% educational. ? Opportunity is provided for all existing Pier tenants to participate in the Development Program provided that the operations meet reasonable standards of quality and service. Existing tenants will be given priority in the selection process for new leases if their leasehold concepts and standards are equal to or better than those of competing applicants. The PRC and City staff have provided the opportunity for existing Pier tenants to present their development concepts consistent with the Development Program and to compete on a priority basis upon expiration of lease terms. 6 ? Design Guidelines will be prepared and implemented as the method by which the eclectic appearance and important design elements of the Pier are retained, preserved and enhanced. Design Guidelines have been adopted and continue to serve as a standard by which any proposed structural modifications and tenant improvements on the Pier are reviewed. ? The Pier’s economic position will be improved by increasing the amount of leased commercial area and providing quality tenancies and services, consistent with the character, scale and role of the Pier to the community. Leasehold uses and operations on the Pier remain eclectic, casual and reasonably unique to Santa Monica, while providing enhanced rental income and recapture of common area maintenance costs. ? The Pier will attract and serve visitors from a broad range of sources, income groups and lifestyles, and provide a vital entertainment and recreational outlet for Santa Monica residents and visitors. In addition to accommodating a relatively low density, eclectic mix of commercial operations, the PRC has promoted the Pier to the Santa Monica 7 community and visitors through annual operation of the Twilight Dance Series, various special public promotional events, private events and filming. For the duration of the present Services Agreement, City staff has been responsible for physical maintenance and repair of the pilings and substructures, all public or common areas of the Pier and for operation of the public parking located on the Pier deck and in the adjacent beach lots. The City, separate from the PRC’s business plan and budget, annually funds these municipal maintenance, repair and operational responsibilities. The 1985 Services Agreement between the City and PRC was for a five-year term expiring June 30, 1990, and has continued for renewable one-year periods since expiration. Negotiations between the PRC and the City for a successor to the expired Services Agreement commenced in 1995, and focused primarily on the PRC’s role in developing a sponsorship and licensing program to promote the Pier and enhance PRC revenues, and in leasehold negotiations, lease management and legal services. As part of its budget considerations in June 1999, City Council concluded that, with the exception of on-going negotiations between the PRC and Pacific Park for a comprehensive lease amendment, lease negotiations and lease management responsibilities were to be transferred to the City Economic Development Division (EDD) staff supported by the Office of the City Attorney. 8 Discussion The proposed new Services Agreement between the City and the PRC is for a two-year term commencing upon its execution by the City, and will continue for successive one-year periods thereafter unless terminated by either party upon thirty days’ notice. This Agreement would supercede the 1985 Services Agreement, and was approved by the PRC Board of Directors at its meeting held August 2, 2000. Under the new Agreement, City Council will continue to delegate to the PRC, as it has since 1983, the obligation and responsibility to direct, supervise and coordinate the development and implementation of policies and programs for the general commercial planning, promotions, advertising and marketing of the Pier. The PRC will continue to prepare and submit to the City for approval an annual business plan and budget setting forth its goals and objectives for the Pier in the ensuing fiscal year, and establish guidelines and policies for leasehold development and occupancy on the Pier. It will continue to review and approve leases and lease modifications, and refer leases to the City Manager for execution following approval. However, unlike the 1985 Services Agreement, City staff with the legal assistance of the Office of the City Attorney will implement the PRC’s leasing goals and objectives by negotiating and administering Pier leases and lease modifications. Annual Plan of Work Under the terms of the proposed Services Agreement, the PRC must prepare and submit to the City for its approval, at least 120 days prior to the 9 commencement of each fiscal year, an overall operational business plan for all activities, policies and business strategies to be implemented on the Pier during the ensuing year. The City has the sole authority to approve each business plan and the annual Pier budget to provide the funds necessary to implement the Annual Plan of Work as approved. Included with each Plan of Work will be a summary and schedule of activities, programs, advertising and public events planned for the Pier; and recommendations to the City for modifications to parking, traffic and circulation patterns, municipal ordinances, capital improvements, product and/or service sponsorship programs, and PRC and City staffing for performance of responsibilities on the Pier. At its meeting held October 4, 2000, the PRC Board of Directors approved the Annual Plan of Work for Fiscal Year 2000-01, attached to this report as Attachment D, subject to approval by City Council. The proposed PRC Annual Plan of Work for Fiscal Year 2000-01 was prepared in accordance with Section 4.1 of the Services Agreement as the statement of the PRC’s overall operational and business plan for the activities to be implemented at the Pier during the year, and incorporates a Mission Statement to preserve and enhance the pleasure pier experience for people of all ages and for future generations. Annual Budget The Pier Budget submitted annually to the City with the Plan of Work will contain an operating budget in a form prescribed by the City including a forecast of 10 anticipated income and delineation of expenses necessary for PRC implementation and performance of responsibilities under the Agreement and business plan. The City has the sole authority to approve each Pier budget. Included with each Pier budget will be a forecast of income derived from sponsorships, licensing, special events and film permitting under the PRC’s direction, and a forecast of expenses necessary to implement PRC duties, such as advertising, marketing and event costs, PRC staff salaries and benefits, and other costs associated with office operations. Leasing Guidelines and Operations Guidelines for design and future development and use of property on the Pier were set forth as public policy statements, goals and objectives in the 1988 General Use and Development Plan. As called for in section 5.1 of the Services Agreement, draft leasing guidelines for the Santa Monica Pier were presented to and reviewed with the Leasing Committee of the PRC on October 26, 2000, and were recommended for approval by the PRC Board. At its meeting held December 6, 2000, the PRC Board adopted a motion recommending approval of the Leasing Guidelines. These are conveyed as Attachment B. The PRC Board has reviewed and approved concepts for development of opportunity sites, which may become available due to lease expiration, lease termination or as part of implementation of the 1988 Plan, in accordance with the approved Plan of Work. The Board considered alternative uses for leaseable sites, established design and operations standards for Pier lessees, and set general policies for solicitation of tenants and review of leasehold proposals. Any lease or lease modification 11 recommended to the PRC Board by City staff for approval will be consistent with the Plan of Work and Leasing Guidelines, and will be subject to review and approval by the Board prior to execution by the City Manager. The sole exception to delegation of duties for lease negotiation and lease administration to City EDD staff is the retention of responsibility by the PRC over current negotiations of a lease modification with Pacific Park. For its part, the City is obligated to use commercially reasonable efforts to solicit proposals and identify qualified prospective tenants for leasehold occupancy of available space on the Pier for purposes consistent with the 1988 Plan and Leasing Guidelines. Leases negotiated for use of Pier space will be reasonably consistent with the Plan of Work and Leasing Guidelines, and must be submitted to the PRC Board in the form of a recommended action for approval prior to implementation. The City EDD staff will also monitor tenant and City compliance with the terms and conditions of approved leases, and enforce lease provisions, respond to tenant and visitor complaints and requests related to Pier leases, bill and collect rents and other tenant assessments which may become due, and pursue legal actions as necessary for the defense and prosecution of leasehold disputes. The PRC Board expressed serious concern for the identification and preservation of preferred uses for each leasehold site on the Pier, and the establishment of pricing for leasehold occupancy consistent with supporting the unique character 12 of Pier uses and optimizing the preferred uses while assisting in the fiscal self- sufficiency of the Pier Fund. Uniqueness and diversity will be maintained, focused on those purposes that support the historic character of the Pier and offer choices of services and pricing within the general use categories. The controlled scope of commercial development and casual recreational ambiance are also important factors in defining the unique character of Santa Monica Pier. Leasing and licensing of buildings and Pier deck area will be subject to a preference for local independent businesses and activities that are financially and operationally capable of providing the preferred uses for each leasehold site. Staff recommends that automatic lease renewals or options to extend occupancy not be offered to existing or future tenants, with two current exceptions. As vacancies arise either by lease expiration or earlier termination, recruitment for occupancy will be conducted in accordance with the Leasing Guidelines, thereby assuring periodic public access to Pier leasing opportunities. The two exceptions are recommended short term interim leases with present month-to-month tenants of Surf View Café, where changes to portions of the Pier deck may arise within the ensuing three years, and Santa Monica Pier Bait & Tackle, which will be affected by the anticipated restoration of a portion of the breakwater and installation of commercial vessel moorings and vessel landing. 13 Rents will be established based upon independently estimated fair market rates or in accordance with responses received to any public Request for Proposal process. Lease rates are considered secondary to implementing or retaining a preferred site use, and pricing may be adjusted as necessary for that purpose. Tenant recruitment would be in accordance with public marketing and solicitation of prospective qualified tenants suitable for the available space. Leasehold tenants will also pay, as a condition of occupancy on the Pier, a proportionate share of the City’s cost to manage, maintain and provide security to Santa Monica Pier. As of January 1, 2000, the applied Common Area Maintenance cost is $5.00 per leased square foot per year, increasing with CPI adjusted as of July 1 biennially. A well-publicized process to market and solicit interest by prospective tenants and licensees with appropriate financial and experience qualifications to successfully implement the preferred uses will be conducted for any available leasehold opportunity on the Pier. Requests for Proposals will be prepared by City staff and approved by the Leasing Committee of the PRC prior to dissemination. Responses to the public solicitation will be analyzed and rated by a review team comprised of City staff and the Executive Director of the PRC. Representatives of City Engineering and/or Planning and Community Development may be included as appropriate. The lease proposal review team will provide its analysis and recommendation as to a preferred respondent to the Leasing committee of the PRC. The recommendation may be to reject all 14 responses, solicit additional information from one or more respondent, or to enter exclusive lease or license negotiations with a preferred respondent. The Leasing Committee will consider the review team analysis and make its recommendation to the PRC Board. The Board may authorize City staff to enter exclusive negotiations with a preferred respondent on terms consistent with the Leasing Guidelines, or it may reject all responses or direct that additional information be solicited. City staff will conduct any negotiations as authorized by the PRC Board, and any proposed agreement will be prepared and subsequently approved as to form by the City Attorney. If a proposed lease or license is consistent with the authorization to enter exclusive negotiations, the Leasing Committee and PRC Board will approve and transmit the lease to the City Manager for execution on behalf of the City. Sponsorship and Licensing The PRC will continue to be responsible for development and implementation of sponsorship and licensing programs in support of Pier operations, marketing and other functions. A Sponsorship Guidelines document will be prepared by the PRC for City review and approval as soon as practicable following execution of this Agreement, setting forth the concepts and general parameters of the sponsorship and licensing programs. The PRC will also prepare and submit for City review and approval as soon as practicable written Marketing Guidelines to establish concepts and general parameters for advertising, special promotions, 15 media relations relating to the Pier, the Pier logo and related products, and enhance public awareness of the various activities and special events relating to the Pier. PRC staff will develop and implement various special events to promote community participation and enjoyment of the Pier, coordinate and implement events in accordance with City ordinances and Special Event Guidelines, and manage filming rights at the Pier. The proposed Agreement establishes the PRC as the exclusive agent for the City to conduct the licensing of service marks, logos and graphic depictions related to the Pier and the Pier sign. The licensing program remains subject to separate City approval. Marketing Program and Funding In addition to funds provided by the City as part of its annual budget process for PRC performance of its operational duties and responsibilities, the City has additionally provided funds commencing with the 1997-98 fiscal year for development of the Pier marketing program. These additional funds have been expended by the PRC in accordance with the annual budget approved by the City for conceptual planning, design and implementation of Pier sponsorship, licensing and marketing activities to enhance revenue received by the PRC in support of public events on the Pier and advertising and promotion of the Pier. Under the proposed Services Agreement, the PRC would annually retain revenue and income received from sponsorship and licensing fees up to the amount identified in the PRC Marketing Budget, as identified in the annual Pier Budget. Upon reaching that revenue threshold, the City would participate in the 16 sponsorship and licensing fees through payment from the PRC in an amount not to exceed $100,000 in any fiscal year. Payments to the City will not exceed the aggregate of funds appropriated by the City to the PRC for marketing commencing from the 1997-98 fiscal year and continuing through the term of this Agreement. Insurance The PRC and any independent contractors employed by it will maintain insurance coverage for commercial public liability, workers’ compensation and employer’s liability, comprehensive automobile liability and such other insurance as the City may require. The insurance shall be primary in connection with claims against the PRC. To the extent that the PRC’s insurance does not cover claims, the City will indemnify and hold harmless the PRC and its officers and employees from any liability, claim, loss, damage or injuries arising from performance of this Agreement. However, the City will not be required to indemnify the PRC against damages resulting from gross negligence or willful misconduct on the part of the PRC. All individuals employed by the PRC will indemnify and save the PRC, the City and its Council, representatives and employees harmless from all liabilities, losses and claims for damage arising from or related to the performance of work or services performed on or about the Pier. 17 Bylaws City Council has requested that its various boards and commissions amend their bylaws to establish director and commissioner term lengths of four years, and to establish an implementing transition plan for the appointment of new board members andcommissioners. The City of Santa Monica acting by and through its City Council is the sole member of the PRC. The member elects the Board of Directors of the PRC, and initiates and approves any amendment to the PRC bylaws. At its meeting held October 4, 2000, the PRC Board of Directors adopted amended bylaws consistent with Council’s request. The proposed PRC Bylaws, attached as Attachment C, set the number of directors at eleven. Directors shall be elected by the member and serve for a term of four years with a limit of two terms. Vacancies in the Board shall be filled by the member in accordance with a nomination and selection procedure established consistent with member policy and with Section 5520 of the California Nonprofit Public Benefit Corporation laws. The PRC Board of Directors also suggests a transition plan for the reappointment of directors to provide continuity while implementing the change in term of years and term limits. The suggested transition plan was devised to cap the terms of current directors to as close to eight years as feasible, while reasonably minimizing turnover during the transition period. As current director terms expire, new directors would be appointed to four-year terms. Upon implementation of 18 the reappointment and replacement schedule, three director positions would expire in November of each year during three of the four-year cycles and two director positions would expire in November of the fourth four-year cycle. Other Under the proposed Services Agreement, the PRC remains a California non- profit public benefit corporation formed by the City for the sole purpose of assisting the City in the rehabilitation, protection, development, operation and management of the Pier. The City is the sole member of the PRC, and the PRC governing board of directors remains subject to appointment by City Council. Oversight and direction of the PRC’s policies, goals, objectives and actions resides with City Council through its appointments to the PRC board of directors, its right of annual review and approval of the PRC Business Plan and Budget, its right of review and approval of any Pier capital improvement projects and Pier maintenance budget, and its right of review and approval of Leasing Guidelines and Marketing Guidelines. Budget and Financial Impact The City currently budgets for and funds anticipated costs of the Pier Restoration Corporation including salaries, supplies and other basic operating expenses through Economic Development Division, Resource Management Department Account Number 30625.577300. Approval of the proposed Services Agreement would not affect the fiscal year 2000-01 budgeted amount. 19 Pier Restoration marketing, sponsorship program and related expenses are currently funded by the City through Economic Development Division, Resource Management Department Account Number 30625.578440. Approval of the proposed Services Agreement would not increase the fiscal year 2000-01 budgeted amount, and may result in City participation in the revenues derived from implementation of the Pier Restoration Corporation sponsorship and licensing program. No budget or financial impact in Fiscal Year 2000-01 will result from approval of the Leasing Guidelines, the PRC Annual Plan of Work, or the amended and restated bylaws of the PRC. The planned activities referenced in the Plan of Work are funded by a combination of the City’s annual budget grant to the PRC plus any sponsorships and promotional fees generated by the PRC. The Fiscal Year 2000-01 Plan of Work submitted for approval is fully funded under the City’s current fiscal year budget. Recommendation Staff recommends that Council approve and authorize the execution of the proposed Services Agreement between the City of Santa Monica and the Santa Monica Pier Restoration Corporation based on the terms and conditions summarized in this report and in the attached Agreement. 20 Staff recommends that City Council approve the proposed Leasing Guidelines for use of Santa Monica Pier commercial areas, and that the City Manager be authorized to implement the Leasing Guidelines as approved. Staff recommends that the City Council approve the PRC Annual Plan of Work for Fiscal Year 2000-01. Staff recommends that the City Council approve the amended and restated bylaws of the PRC. Attachments: A Services Agreement between the City of Santa Monica and the Santa Monica Pier Restoration Corporation B Santa Monica Pier Leasing Guidelines C Amended and Restated Bylaws of Santa Monica Pier Restoration Corporation D Annual Plan of Work for Fiscal Year 2000-01 by the Santa Monica Pier Restoration Corporation Prepared by: Jeff Mathieu, Director of Resource Management Mark H. Richter, Economic Development Manager JoAnne Brosi, Senior Administrative Analyst 21 ATTACHMENT A Services Agreement between the City of Santa Monica and the Santa Monica Pier Restoration Corporation SERVICES AGREEMENT BETWEEN THE CITY OF SANTA MONICA AND THE SANTA MONICA PIER RESTORATION CORPORATION SERVICES AGREEMENT THIS SERVICES AGREEMENT ("Agreement") is made as of this _____ day of July, 2000 (“Execution Date”), by and between the CITY OF SANTA MONICA, a California municipal corporation ("City"), and the SANTA MONICA PIER RESTORATION CORPORATION, a California non-profit public benefit corporation ("PRC"), with respect to the following: RECITALS City A. . City is a municipal corporation duly organized and validly existing under the laws of the State of California with the power to carry on its business as it is now being conducted under the statutes of the State of California and the Charter of the City. Pier B. . City owns and operates that certain real property commonly known as the Santa Monica Pier and consisting of the entire pier platform and certain appurtenant structures, fixtures, improvements, utility lines and systems, public restrooms, public parking sites, stairways and common areas, and maintenance and equipment areas located thereon, including the leasehold space currently occupied by the UCLA Ocean Discovery Center and the Boat House Restaurant, all as more particularly described in Exhibit "A" attached hereto and incorporated herein by reference (collectively referred to as the "Pier"). PRC C. . PRC is a California non-profit public benefit corporation formed for the purpose of assisting City in the rehabilitation, preservation, protection, development, operation, and management of the Pier. As set forth in the PRC’s Articles of Incorporation and Bylaws, the City is the sole member of the PRC. PRC is governed by a board of directors ("PRC Board") who are appointed by the City Council. Prior Services Agreement D. . City and PRC entered into that certain Services Agreement, dated as of December 2, 1985 ("Prior Agreement"), for the purpose of governing certain operational and management functions concerning the Pier. This Agreement is intended to supersede the Prior Agreement. Accordingly, upon the commencement of the term of this Agreement, the Prior Agreement shall terminate and be of no further force or effect. Agreement E. . City and PRC recognize and acknowledge that the Pier is a valuable recreational resource of City, which should be developed, protected, and preserved as a public resource. Accordingly, City desires to assign certain responsibilities to the PRC as set forth in this Agreement, and the PRC desires to accept such assignment, upon the terms and conditions set forth herein. NOW, THEREFORE, in consideration of the foregoing recitals and the mutual promises and covenants contained herein, City and PRC agree as follows: RECITALS 1. . The recitals are incorporated herein by reference into this Agreement. ASSIGNMENT AND AUTHORITY OF PRC 2. . The City hereby assigns to the PRC, and the PRC accepts the assignment, of certain responsibilities more particularly described in this Agreement to develop, implement, and maintain various programs and functions in connection with the operation and management of the Pier, including promotions, marketing, special events, sponsorship, licensing, filming and vendors. In addition, the PRC agrees to assist the City with the formulation of commercial development proposals, Pier improvements proposals, Pier leasing guidelines, and sponsorship programs. GENERAL RESPONSIBILITIES 3. . General 3.1 . PRC shall be responsible for the promotion of public and commercial use of the Pier and for providing several project services (hereinafter called the "Work") at the Pier. Such Work shall include the obligation to manage, advise, supervise, direct and coordinate: (a) the development, implementation, execution, and maintenance of policies and programs concerning general commercial planning, promotions, advertising, marketing, special activities and events, sponsorships, licensing, and filming at the Pier as set forth more particularly in Article 6, below; (b) the preparation and submission of Business Plans and Budgets for the City’s approval on an annual basis that sets forth its plans for the Pier for each fiscal year as set forth more particularly in Article 4, below; (c) the establishment of guidelines and policies for leasehold development at the Pier, as well as the review and approval of leases and lease modifications presented by the City, as set forth more particularly in Article 5, below; 2 (d) providing recommendations to the City on matters related to health, public safety and capital improvements on the Pier and adjacent public areas as set forth more particularly in Articles 6.9 and 6.10, below; (e) the purchase of Pier supplies, materials, and parts from time to time as contemplated and authorized under the Business Plan as set forth more particularly in Article 9.3, below; and (f) the hiring and discharging of PRC's employees, suppliers, materialmen and subcontractors. (g) other services, labor and materials to adequately perform the work required pursuant to this Agreement; and (h) other additional services in connection with the Pier as the parties may agree from time to time. Standard of Care 3.2 . PRC shall furnish its best skill and judgment in the performance of the work so as to achieve a high degree of cost efficiency while maintaining quality performance, and shall cooperate with City in protecting and furthering the best interests of City regarding the management of the Pier. BUSINESS PLAN AND PIER BUDGET 4. Annual Business Plan 4.1 . PRC shall prepare and submit to City for City’s approval, at least one hundred twenty (120) days prior to the commencement of each fiscal year, an overall operational, use, and business plan for all activities, policies, and business strategies to be implemented at the Pier by PRC for each upcoming fiscal year of City (“Business Plan”). City shall have the sole authority to review and approve each Business Plan, including the annual Pier Budget (as hereinafter defined) contained therein as necessary to implement each approved Business Plan. Each Business Plan shall include, without limitation, each of the following: (a) a summary and schedule for those activities, events, programs, and other areas of responsibility assigned to PRC in this Agreement, including, without limitation, those duties concerning Pier advertising, event management, planning and development, leasing guidelines and approvals, sponsorships and licensing, marketing and promotion, special events, film permitting, service contracts and insurance; (b) as appropriate, recommendations to City to address traffic, vehicular and pedestrian circulation, parking, safety, and other community concerns arising in the vicinity of the Pier; (c) as appropriate, recommendations to City for any new ordinances or modifications to existing ordinances to improve the Pier and its environs; (d) as appropriate, recommendations to City for amendments or revisions to any plan for the development of the Pier and traffic, circulation and parking modifications affecting the Pier, and capital improvements and budgets therefor; (e) as appropriate, recommendations to City for product and/or service sponsorship programs for the Pier; (f) as appropriate, recommendations to City on levels of staffing for performance of City responsibilities relating to maintenance, repair and leasehold management; and (g) a summary of advertising and marketing activities, events and programs to be undertaken by PRC on behalf of City if funds are available pursuant to Article 8.1 of this Agreement. Annual Pier Budget 4.2 . Together with the annual Business Plan summarized in Article 4.1 above, PRC shall prepare and submit to City for City’s approval, at least one hundred twenty (120) days prior to the commencement of each fiscal year, a pro forma operating budget and forecast of income and expenses for implementation and performance of those activities, events, programs, and other areas of responsibility assigned to PRC in this Agreement (“Pier Budget”). City shall have the sole authority to review and approve each Pier Budget in accordance Articles 4.2 and 9.1 of this Agreement. For each fiscal year, the Pier Budget shall include, without limitation, each of the following elements: (a) a pro forma forecast of income and expenses considered necessary by the PRC to implement the duties and responsibilities assigned to PRC in this Agreement including, without limitation, Pier advertising, event management, planning and development, leasing guidelines and approvals, sponsorships and licensing, marketing and promotion, special events, film permitting, service contracts and insurance; and (b) a pro forma operating budget setting forth the cost of PRC’s operation including, without limitation, the cost of PRC’s staff salaries and benefits, out- of-pocket expenses, and costs associated with office operations. The operating budget shall also set forth the estimated cost of PRC’s advertising and marketing activities which may be performed by PRC on behalf of City if funds are available as set forth in Articles 4.2 and 9.1 of this Agreement. Business Plan and Pier Budget Review 4.3 . City will consider the Business Plan and Pier Budget, and any recommendations of PRC regarding community concerns, ordinances, capital improvements, product and/or service sponsorship programs, and City performance of its responsibilities, and will consult with PRC in the period prior to the commencement of each subsequent fiscal year in order to agree upon each Business Plan and Pier Budget. The Pier Budget shall provide sufficient funds for the promotion, marketing, advertising and event management of the Pier in a manner appropriate for a public asset dedicated to recreational and mixed commercial uses, as determined in City’s sole discretion and consistent with the Business Plan. Implementation of Business Plan and Pier Budget 4.4 . Once approved by City, PRC shall implement the Business Plan and Pier Budget and, except as otherwise required by this Agreement or the Business Plan, shall be authorized without the need of further approvals to make the expenditures and incur the obligations provided for in such Business Plan. During any fiscal year, either party may propose an amendment to the Business Plan or Pier Budget based on changed circumstances, which amendment must be approved by City in writing. Performance Within Pier Budget 4.5 . PRC shall use diligence and employ all reasonable efforts to ensure that the actual costs of promoting, marketing and performance of its responsibilities on the Pier shall not exceed the Pier Budget either in total or in any accounting category. Where feasible, PRC shall attempt to reduce actual costs of performance of its responsibilities on the Pier below the amounts specified in the Pier Budget. All expenses must be charged to the proper account on the Pier Budget and no expense may be classified or reclassified for the purpose of not accounting for an excess in the annual budgeted amount of an accounting category. Any contract entered into by the PRC shall not exceed the length of the then current fiscal year, unless such contract specifies that contractual obligations beyond such fiscal year shall be subject to budgetary and programmatic approval of the City Council. Accounts, Books and Records 4.6 . In order to facilitate the management of cash handling, the PRC shall maintain an account with the same financial institution utilized by the City (“PRC Account”). In addition, the PRC shall maintain its books and GAAP records in accordance with generally accepted accounting principles (“”) in a manner as will facilitate accurate preparation of necessary fiscal reports and in the form required by the City’s Director of Finance and reasonably acceptable to the City. Such books and records shall be maintained by PRC at PRC’s address set forth below or at such other location as may be mutually agreed upon in writing, and shall be so maintained for a period of ten (10) years after the creation of such books and records (except in the event of an audit, litigation or other proceeding involving such books and records which is not complete within said ten (10) year period, in which case, the books and records shall be maintained until the conclusion of the proceeding), or for such other period as City and PRC shall agree. City and its representatives shall have the right of access to audit and to inspect all books and records maintained by PRC with respect to the Pier. All audits shall be at City's cost, shall be conducted during normal business hours and shall be conducted at PRC’s office where such books and records are located or at the Pier. Any audit may be conducted by City's Director of Finance, City's direct employees or by independent auditors engaged by City. PRC shall cooperate with City's auditors and accountants in any inspection and audit of the books and records and the preparation of financial statements and tax returns. Should an inspection or audit reveal material weaknesses or material errors in record keeping, PRC shall immediately correct such weaknesses or errors. PRC shall expend commercially reasonable best efforts to control accounting and financial transactions as is reasonably required to protect City's assets from theft, error or fraudulent activity on the part of PRC's associates or direct employees. Accounting 4.7 . Monthly statements of PRC operations shall be provided to City within thirty-five (35) days after each month hereunder and shall show payments, collections, delinquencies, uncollectible items, and other matters pertaining to the promotion, marketing and operation of the Pier during the preceding month. The statements shall include a comparison of monthly and year-to-date actual income and expenses with the Pier Budget. PRC shall, on a quarterly basis, provide City with an analysis of any significant variances between budgeted and actual amounts. Such statements and reports shall be in a form required by City's Director of Finance or otherwise acceptable to City. Copies of Books and Records 4.8 . PRC shall maintain, and shall supply to City upon request, copies of the books and records maintained by PRC for the Pier, including, but not limited to: (a) All bank statements, bank deposit slips and bank reconciliations; (b) Detailed cash receipts and disbursement records; (c) Detailed trial balance; (d) Paid invoices; (e) Summaries of adjusting journal entries; (f) Supporting documentation for payroll, payroll taxes and employee benefits; and (g) Vouchers, statements and records from all independent contractors engaged by PRC. Miscellaneous Reports and Information 4.9 . PRC shall deliver to City copies of all notices, agendas, and minutes of PRC Board meetings, quarterly financial reports of expenditures, and semi-annual reports of all program and promotional activities. In addition, PRC shall prepare, from time to time, reports concerning such other matters relating to its responsibilities as City may reasonably request. LEASING 5. . PRC Leasing Responsibilities 5.1 . PRC’s lease responsibilities shall include the following functions: (a) PRC Board shall review and approve concepts, definitions and parameters from time to time concerning (i) opportunity sites available on the Pier for leasehold occupancy and development; (ii) uses for opportunity sites to be leased; (iii) design and operations standards for Pier lessees and their occupancies, and (iv) general policies for solicitation of tenants and review of leasehold proposals, all of which shall be subject to leasing guidelines prepared by PRC and approved by City (“Leasing Guidelines”). PRC Board shall submit to City for City’s approval the Leasing Guidelines as soon as practicable, but in no event later than one hundred twenty (120) days after execution of this Agreement. City shall have the sole authority to review and approve the Leasing Guidelines; (b) PRC Board shall use its commercially reasonable best efforts to assist City to facilitate the leasehold occupancy of all available space on the Pier which is at any time unleased during the term of this Agreement in accordance with the Leasing Guidelines. PRC shall promptly notify City of any prospective tenants for lease space on the Pier. City may, after consultation with PRC, issue requests for proposals for leasehold occupancy and development of available space on the Pier; (c) PRC Board shall keep City informed through periodic reports regarding the names and businesses of all prospective tenant contacts, including inquiries and offers from brokers, advertising and promotional activity, and similar activity and developments, all in such form and detail as City shall reasonably require; (d) PRC Board shall review each proposed lease or lease modification, and shall submit a memorandum to City stating whether the lease or lease modification is consistent with the Leasing Guidelines and approved by PRC Board. No lease or lease modification shall be effective without the prior approval of PRC Board, approval as to form by the City Attorney, and execution by City. However, in the event that any lease agreement becomes the subject of litigation, City shall have sole responsibility for all decisions in connection with the litigation and the requirements of lease review of the PRC Board shall not apply; (e) PRC shall have primary responsibility over the negotiations of the lease modification pertaining to the current monetary dispute, boundary line dispute, and arcade games dispute (collectively, the "Disputed Issues") with Santa Monica Amusements, Inc., commonly known as Pacific Park, until the execution of the lease modification incorporating the resolution of the Disputed Issues or until otherwise specified by the City; (f) PRC Board shall review and approve concepts, definitions and parameters for a master vending program for the Pier as part of the Leasing Guidelines and which shall provide for the leasing and/or licensing of vendors to sell merchandise on the Pier (“Vendor Program”). In addition to any requirement of the PRC, any such vendors shall be required to comply with all other applicable laws, including the obligation to obtain business licenses and compliance with any other City rules and regulations. The Vendor Program shall specify the vendor solicitation and selection process and the relevant documentation to be used in connection therewith. City Leasing Responsibilities 5.2 . PRC shall not be responsible for any of the following functions, which shall be the responsibility of City: (a) use commercially reasonable efforts to solicit proposals and identify prospective tenants for occupancy of available space on the Pier for purposes which are reasonably consistent with the Leasing Guidelines; (b) negotiate leases and, as deemed necessary in its sole discretion, lease modifications for use of space on the Pier which are reasonably consistent with the Leasing Guidelines; (c) monitor the fulfillment of landlord and tenant obligations pursuant to tenant leases; identify and respond to tenant and landlord issues that arise in the course of the various tenants’ lease terms; (d) use commercially reasonable efforts to enforce provisions of the tenant leases, and use commercially reasonable efforts to cause all tenants to comply with terms of all easements, restrictions or covenants affecting the Pier and all applicable laws affecting the Pier; (e) respond to complaints and requests from tenants related to their leasehold occupancies on the Pier, and respond to complaints and requests from visitors to the Pier related to leasehold occupancies on the Pier; (f) secure from tenants any certificates of insurance, and renewals thereof, required to be furnished by the terms of the leases, and notify the City’s Business License Office in writing of all leases in effect at the commencement of each fiscal year and upon the execution of any lease for occupancy on the Pier; (g) use commercially reasonable efforts to bill and to collect all rents and other charges which may become due at any time from any tenant or from others for services provided in connection with or for the use of the Pier, including tenant and employee parking, tenant storage, common area maintenance charges, and promotion fees; (h) pursue legal actions, as necessary, for the defense and prosecution of leasehold disputes involving the Pier, including, but not limited to, collection of rent or other amounts due to City, dispossession of tenants and other persons from the Pier, and breach of contract actions; (i) administer the solicitation and selection of vendors, and prepare, negotiate, and administer licenses for vendors pursuant to the Vendor Program. No Commission 5.3 . No commission or compensation of any kind shall be payable to PRC in connection with any lease, sale, or other transfer of the Pier or any portion thereof. SPECIFIC MANAGEMENT RESPONSIBILITIES 6. . PRC shall each use its commercially reasonable best efforts in performing the following specific functions: Planning and Development 6.1 . PRC shall establish short term and long term planning and development objectives for (a) leasing and continued development, activities, and (b) services to be performed by PRC concerning the operation, use, and development of the Pier which objectives shall be incorporated in the Annual Business Plan as set forth in Article 4.1 of this Agreement. Corporate Sponsorships 6.2 . PRC and City agree that it may be desirable to involve the Pier with one or more corporate sponsorship programs so as to increase revenues or other resources that may be made available, including, without limitation, in- kind contributions in support of Pier operations, marketing and other functions. PRC shall be responsible for establishing appropriate concepts and general parameters for any corporate sponsorship programs involving the Pier, and shall prepare written guidelines (“Sponsorship Guidelines”) for review and approval by the City as soon as practicable upon the execution of this Agreement. Upon approval by the City of the Sponsorship Guidelines, PRC shall implement any sponsorship programs pursuant to the Sponsorship Guidelines. PRC shall have the sole right to solicit, create, manage, and service all corporate sponsorship programs. The corporate sponsorship programs shall be in full compliance with all applicable laws, regulations and ordinances. PRC shall provide the City with a full and complete accounting of such revenues on at least a quarterly basis. Marketing and Promotion 6.3 . PRC shall develop and implement various marketing programs from time to time to enhance the commercial operation and aesthetic quality of the Pier and adjacent areas and to emphasize the Pier's historical and recreational significance. These marketing programs, including without limitation, advertising, promotions, marketing, and media relations relating to the Pier, the Pier logo, and related products, will create public awareness of the various activities and special events relating to the Pier and future development plans concerning the Pier. The PRC shall establish appropriate concepts and general parameters for marketing programs involving the Pier, and shall prepare written guidelines (“Marketing Guidelines”) for review and approval by the City as soon as practicable upon the execution of this Agreement. Upon approval by the City of the Marketing Guidelines, PRC shall implement such programs. All advertising, promotional materials and marketing programs shall comply with all applicable laws, ordinances and regulations, and all tenant leases. All expenses incurred by the PRC related to marketing shall be in accordance with the Business Plan and Pier Budget. Special Events 6.4 . PRC shall develop and implement various special events from time to time to enhance community participation and enjoyment of the Pier, taking advantage of the Pier's historical and recreational significance. PRC shall establish appropriate concepts, fees and general parameters for special events involving the Pier, and implement such events and coordinate these events with appropriate marketing and promotional programs and meeting community guidelines. All special events shall be in compliance with City ordinances, regulations and Special Event Guidelines. Filming at the Pier 6.5 . PRC and City agree that it may be desirable to permit filming of and/or on the Pier from time to time to create revenues for the Pier and to bring attention to the Pier's historical and recreational significance. PRC shall solicit, negotiate, and manage filming rights at the Pier. PRC shall be responsible for establishing appropriate concepts, fees and general parameters for permitting such filming involving the Pier, and for implementing PRC policies to bring about appropriate filming at the Pier and coordinate any such filming with the daily operation of the Pier. All filming shall be in compliance with City ordinances, regulations and Filming Guidelines. Marks 6.6 . PRC shall be the exclusive agent for the City to conduct the licensing of the City’s service marks, copyrights, representations, names, logos, artwork, photographs, graphic depictions or other material related to the Pier and the sign affixed to the entrance of the Pier (collectively, the "Marks"). PRC shall establish and implement appropriate concepts, fees and general parameters for licensing the Marks consistent with the Marketing Guidelines. This provision is not intended to convey any proprietary interest in the Marks to the PRC, and the City shall remain the owner of all proprietary interest in the Marks throughout the term of this Agreement. PRC shall honor all currently existing licensing arrangements set forth in the tenant lease agreements. Security 6.7 . PRC Responsibility (a) . PRC shall provide City with recommendations relating to security and public safety issues concerning the Pier. PRC shall not be responsible for policing the Pier or for administering any security plan. City Responsibility (b) . City, in its sole and absolute discretion, shall police the Pier and otherwise provide all security for the Pier and its environs. The foregoing shall not be construed to affect any tenant's responsibility to provide security with respect to such tenant's premises at the Pier. Janitorial/Custodial 6.8 . City shall be responsible for supervising and managing janitorial and custodial services for the Pier. PRC shall advise City on concepts and general parameters for such services. Repairs and Maintenance 6.9 . The PRC shall suggest standards and general parameters for maintenance and repair of the Pier to the City. The City may, in its sole and absolute discretion, adopt the suggestions of the Pier; provided, however, that nothing in this Agreement shall obligate City to undertake or complete such repairs or maintenance. Capital Improvements 6.10 . PRC Responsibility (a) . As part of or otherwise in accordance with the Business Plan and the goals and policies contained therein, PRC shall make recommendations and proposals concerning capital improvements to the Pier, and shall prepare such studies and reports as City may request related thereto. Such proposals shall contain and/or consider economic analyses, parking plans, community needs, and such other concerns as City may designate. City Responsibility (b) . City may, in its sole and absolute discretion, approve recommendations and proposals from PRC and implement any capital improvements so approved; provided, however, that nothing in this Agreement shall obligate City to undertake or complete any construction project at the Pier. City shall not implement any capital improvements on the Pier without prior written notice to the PRC. City Inspection 6.11 . PRC shall permit and facilitate inspection of the work by City, its representatives, and other public authorities at all times. Failure of City during the term of this Agreement to discover or reject unacceptable work, or work not in accordance with the terms of this Agreement, shall not be deemed an acceptance thereof nor a waiver of City's right to the proper execution of the work or any part of it by PRC. METHODS OF OPERATION 7. . Contracting 7.1 . All service contracts for expenditures included within the Pier Budget shall be paid by PRC from funds provided by City pursuant to this Agreement. Without relieving it of its obligations hereunder, PRC shall be entitled, at its expense, to enter in its own name into such subcontracts with third parties to perform any of the functions which are the subject of this Agreement and the Business Plan. However, all other contracts with respect to the Pier and all tenant leases shall be executed by City except (a) in the event that City directs PRC to act as agent for City for such purpose or (b) as otherwise set forth in the Business Plan. Upon any termination of this Agreement, PRC shall, if and to the extent requested by City, assign all assignable contracts executed by PRC to City. Compliance with Laws 7.2 . (a) In performing all of the services provided by PRC pursuant to this Agreement and any exhibits hereto, PRC shall be responsible for compliance with: (i) all applicable federal, state and municipal laws, ordinances, regulations and orders; (ii) applicable laws and regulations relating to workers' compensation, social security, unemployment insurance, hours of labor, wages, working conditions and other employer- employee related subjects; and (iii) the rules, regulations or orders of the local Board of Fire Underwriters or other similar body. PRC shall promptly remedy any violation of any such law, ordinance, rule, regulation or order which comes to its attention. Expenses incurred by PRC in so complying and in correcting any such violation shall be included in the Pier Budget, provided, PRC shall be solely responsible for any fine or other cost or penalty imposed upon City stemming from PRC's failure to comply with any law, ordinance, rule or regulation, provided that the City, in its fiduciary capacity, does not cause such violation (or prevent PRC's compliance therewith). (b) PRC agrees that, for the purpose of compliance with the requirements of the Occupational Safety and Health Act of 1970, as amended ("OSHA"), work performed on the Pier by or under the supervision of PRC shall be deemed entirely within PRC's responsibility. PRC will notify City promptly, in writing, if PRC observes an unsafe condition on the Pier, or if a charge of non-compliance with OSHA has been filed or to PRC's knowledge threatened to be filed against PRC or City in connection with the Pier. Employment of Personnel 7.3 . (a) In accordance with the Business Plan, PRC shall have in its employ at all times during the term of this Agreement a sufficient number of capable employees to enable it to properly, adequately and economically perform its responsibilities consistent with this Agreement and the standards contained herein. All matters pertaining to the employment, supervision, compensation, promotion and discharge of such employees, as well as union negotiation and compliance with laws and regulations dealing with employee matters, are the responsibility of PRC, which is in all respects the employer of such employees. PRC shall be responsible to City for the acts and omissions of its agents and employees, each acting within the scope of his or her relationship with PRC. If PRC enters into contracts with independent contractors, PRC shall require that each independent contractor comply with the provisions of Article 10, below, and be responsible to PRC and City for the acts and omissions of the independent contractor's agents and employees. For security purposes, PRC shall use commercially reasonable efforts to screen persons employed by PRC prior to employment and giving them access to the Pier. PRC shall ensure that all of its employees understand that they are the employees of PRC and not City. The wages, salaries and other compensation paid to employees and independent contractors of the PRC shall be paid by PRC from the Pier Budget. (b) PRC shall provide equal opportunity employment to all people without regard to race, religion, color, sex, marital status, national origin, age, disability, the condition of having AIDS and/or sexual orientation. PRC shall provide City with a copy of its personnel policies manual which sets forth the policies governing the transactions between employees and prospective employees and PRC relating to employment benefits and other personnel-related activities. FINANCIAL MATTERS 8. . PRC Account 8.1 . Funds shall be transferred from City into a PRC Account (“PRC Account”) in advance as requested by PRC from time to time, typically on a quarterly basis, sufficient to cover the amounts expendable pursuant to this agreement or the Business Plan. PRC shall also deposit all revenue and income received by or for the PRC from sponsorship fees and licensing fees into the PRC Account. PRC shall identify all such revenue and income by source and provide a report to the City, on a quarterly basis, identifying the revenue and income. Under no circumstances shall the aggregate amount of draws from the PRC Account exceed the approved annual Pier Budget in any fiscal year. It is understood the periodic amounts deposited into the PRC Account may fluctuate, as income varies, provided all such funding shall be in accordance with the Business Plan and the approved Pier Budget. The PRC Account shall be in a separate bank account established by PRC at a bank utilized and approved by the City. All funds so deposited shall be held in trust for City, and shall be disbursed in accordance with this Agreement and the Business Plan. PRC shall pay from the PRC Account all expenses of the PRC for which it is responsible under this Agreement. Payment of Bills 8.2 . PRC shall pay promptly all expenses it incurs in the performance of this Agreement and agrees to hold City harmless from and against any claim or liability on account of nonpayment of such expenses when properly due and payable and so long as there are sufficient amounts in the PRC Account to cover such expenses. Upon demand, or on expiration or earlier termination of this Agreement, PRC will pay over promptly to City any balance remaining in the PRC Account, after deducting any sums properly due and owing to PRC hereunder, subject to Article 10.3 hereof, and shall remove its name as a signatory on the PRC Account and shall submit an itemized accounting of such sums together with such supporting data as City may reasonably require. Deposit of Revenues 8.3 . PRC shall deposit all revenue and income received by or for the PRC for charitable donations and revenue from special events with Resource Management Department of the City but no later than fifteen business days following receipt of such revenues and income. PRC shall identify all such income and revenue by source and provide a report to the City identifying the revenue or income. Participation in Marketing Funds 8.4 . The term “Marketing Fees” shall mean and refer to funds deposited by PRC into the PRC Account from revenue and income received by the PRC from sponsorship fees and licensing fees in each fiscal year. During the term of this Agreement, City shall receive from the PRC as follows: (a) In any fiscal year where the aggregate amount of Marketing Fees is greater than the budgeted amount for PRC’s sponsorship fees and licensing fees revenue as approved by the City (the “Marketing Budget”), the City shall receive from PRC the amount equivalent to twenty-five percent (25%) of the Marketing Fees in excess of the Marketing Budget, in an amount not to exceed $100,000 in any fiscal year (the “Annual Marketing Payment”). The Annual Marketing Payment shall be payable within ninety (90) days after the end of each fiscal year. (b) The aggregate Annual Marketing Payments shall not exceed the total aggregate of funds appropriated by the City to PRC for marketing as identified in the City’s annual budget as “PRC Marketing” with account number 30625.578440 commencing from City fiscal year 1997-98 and continuing up through the term of this Agreement. FUNDING OF PRC 9. . Funding 9.1 . City shall fund the PRC each fiscal year through City’s normal budgetary process as necessary for PRC to perform its services pursuant to this Agreement. PRC shall submit its budget requests annually with its Business Plan, allowing City staff adequate time to incorporate such request through City’s normal budget process, and City shall approve or disapprove the same in a timely manner allowing PRC adequate time to avoid unnecessary disruption of regular PRC operations. Nothing herein shall be deemed to obligate City to approve funding for any particular expense or program. Employee Compensation 9.2 . PRC shall pay for the compensation of its employees from the Pier Budget. PRC agrees to compensate its employees on the following basis: (a) The number, job classifications, general duties and salaries of employees of PRC shall be determined by PRC. All wages, salaries, and other compensation shall be reasonable in amount and shall be paid by PRC from funds provided by City pursuant to the Pier Budget and this Agreement. (b) PRC shall make disbursements and deposits for all compensation and other amounts payable with respect to persons employed by PRC in the performance of its responsibilities on the Pier. The amounts so payable shall include, but not be limited to, wages, salaries, and other compensation, unemployment insurance, social security, worker's compensation, employee benefit packages, payroll processing, recruiting agency fees and other charges imposed by a governmental authority or provided for in a union agreement. PRC shall maintain complete payroll records. Out-of-Pocket Expenses, Office and Other Services 9.3 . In accordance with the approved Pier Budget, PRC shall be entitled to funds from City for reasonable direct out-of-pocket expenses including, but not limited to, normal office expenses and business and local travel expenses associated with operating an on-site business office at the Pier. Further, in accordance with the approved Pier Budget, City shall provide for PRC’s use an adequately furnished management office in the Pier, to be utilized directly for the benefit of the Pier, together with telephone service, janitorial service, printed forms and customary office supplies and equipment (such as typewriters, computers, photocopying equipment and calculators). The method of furnishing and equipping such office, and the total cost thereof, shall be determined by City from time to time taking into consideration the recommendations of PRC and shall be set forth in the approved Business Plan and Pier Budget. Payment and Record of Expenses 9.4 . Payment of the expenses of the PRC set forth in this Agreement, subject to the provisions of the Pier Budget, shall be made from the PRC Account described in Article 8.1 above. A detailed summary of such expenses shall be included on PRC's regular accountings to City. Role of PRC 9.5 . The parties expressly acknowledge that PRC is not acting as a real estate broker or real estate agent for City, and the PRC is not providing any services for which a real estate broker's or salesperson's license is required pursuant to the California Business and Professions Code. Matters Beyond PRC Responsibility 9.6 . PRC shall not be responsible for the payment of any property taxes, assessments, or other costs associated with the ownership of the Pier, except as may be specifically required to be paid by PRC pursuant to this Agreement or the Business Plan or as otherwise required or approved and funded by City. Reversion of Property 9.7 . Any assets, including without limitation furniture, equipment, and supplies, purchased with funds obtained by PRC from any source pursuant to the Pier Budget shall revert to City at the termination of this Agreement, unless a new agreement is entered into between City and PRC for a purpose similar to this Agreement. INDEMNIFICATION AND INSURANCE 10. . Indemnity by City 10.1 . It is understood between the parties that PRC’s insurance set forth in Article 10.2, below, shall be the primary insurance in connection with claims, actions or proceedings arising from PRC’s performance of this Agreement. To the extent that PRC’s insurance does not cover such claim, action or proceeding, the City agrees to indemnify, save, defend, and hold harmless PRC and its officers, directors, agents and employees (collectively “the PRC”) from any liability, claim, loss, damage, or injuries whatsoever arising directly or indirectly from or in any manner related to the PRC’s performance of this Agreement. PRC must first seek coverage for any defense and/or indemnity with respect to such claim, action or proceeding from PRC’s insurer. To the extent coverage from such insurer is not available, the City shall defend such claim, action or proceeding against PRC arising therefrom, at its cost and expense, subject to any reservation of rights; provided that the PRC promptly notify the City of any claim, action or proceeding and cooperate with the City in connection with the defense of such claim or lawsuit. Notwithstanding the foregoing, City shall not be required to indemnify the PRC against damages suffered as a result of the following: (i) gross negligence of the PRC; and (ii) willful misconduct on the part of PRC. This Article 10.1 shall survive the expiration or earlier termination of this Agreement. PRC's Insurance 10.2 . During the term of this Agreement, PRC (as an expense payable from funds provided by City to the PRC Account under this Agreement) and independent contractors employed by PRC hereunder pursuant to a written agreement entered into after the date of Agreement (at such contractor's expense) shall maintain in full force and effect the following kinds of insurance covering its respective operations in the State of California: (a) Broad Form Commercial Public Liability, including coverage of the contractual liability described in Articles 10.1 and 10.3, as applicable. Unless otherwise approved in writing by City, PRC will maintain at least One Million Dollars ($1,000,000) of such coverage and require all independent contractors it employs hereunder to maintain public liability insurance in the minimum amount of One Million Dollars ($1,000,000), combined single limit, covering both bodily injury (including death) and property damage; (b) Workers' Compensation and Employer's Liability in an amount not less than required by California laws, covering all employees who are engaged in any work under this Agreement; and (c) Comprehensive Automobile Liability when the services to be performed require use of a motor vehicle; (d) Such other insurance as City may reasonably require, upon 90 days advance written notice from City. (e) Such PRC insurance coverage shall be subject to City's approval for carriers and adequacy of protection, and City may elect to insure PRC under policies carried by City. If City does not elect to insure PRC under City's policies, PRC's policies shall name City, its City Council, its boards and commissions, its agents, representatives, employees, and lenders designated by City as additional insureds. Nothing shall prohibit PRC from purchasing any insurance under which PRC, its officers, directors, employees, and agents are named as insureds, but in no event shall PRC be deemed to be responsible for insuring the interests of City as owner of the Pier. Third Party Indemnity 10.3 . PRC shall require that all persons it employs hereunder (other than common law employees) indemnify and save City, its City Council, its boards and commissions, its agents, representatives, employees, and lenders designated by City, PRC and their respective officers, directors, agents, employees, and affiliates harmless from, and defend them against, all liabilities, losses and claims, and reimburse them for all expenses they incur (including the costs of litigation and reasonable attorneys' fees) on account of personal injury or death to persons and damage to property which occurs on the Pier, to the extent caused by the misconduct or wrongful or negligent act or omission of such independent contractor, or employees or agents of such independent contractor, arising from or related to the performance of work or services it performs on or about the Pier, or from such contractor's property. Each independent contractor that PRC employs hereunder shall pay for and defend any and all suits or actions threatened or instituted against PRC or City, its City Council, its boards and commissions, its agents, representatives, employees, and its lenders designated by City, and shall pay all reasonable attorneys' fees, litigation costs and all other expenses in connection therewith, and shall promptly discharge any judgments arising therefrom. These conditions shall also apply to any work or operations subcontracted by such contractors. Such provisions shall expressly survive the expiration of any contracts in which they are contained. City’s Insurance 10.4 . City may self-insure or may carry, at its own expense, property damage and public liability insurance for the Pier if and to the extent that City determines in its sole discretion that such insurance is reasonably required. PRC and its officers, directors, and employees shall be named insureds under these insurance policies to the same extent that the Councilpersons of the City Council of City are insured. TERM OF AGREEMENT 11. . Term 11.1 . The initial term of this Agreement shall commence upon the Execution Date, and shall continue for a period of two (2) years thereafter unless terminated earlier pursuant to Article 11.2. This Agreement shall automatically be renewed upon provisions identical to those contained herein (unless modified by mutual agreement of the parties) for successive periods of one (1) year each unless either PRC or City, in its discretion, elects not to renew this Agreement by written notice to the other party at least 30 days prior to the expiration of the initial term and of each renewal term of this Agreement. Early Termination 11.2 . Notwithstanding the provisions of Article 11.1, this Agreement may be terminated prior to the expiration of the initial term or any renewal thereof upon the occurrence of any of the following events: (a) Either party may terminate this Agreement, without cause, upon six (6) months prior written notice; or (b) This Agreement shall terminate upon the closing of a sale or exchange by City of its entire interest in the Pier or City's right to collect the income therefrom, unless City's transferee elects prior to such closing, by written notice consented to by PRC, to assume the obligations of City pursuant to this Agreement; or (c) This Agreement may be terminated by City, by at least thirty (30) day's written notice to PRC, upon the destruction of a substantial part of the Pier, or if the Pier is rendered untenantable in whole or in part, by fire or other casualty, provided that City does not thereafter proceed with the reconstruction of the Pier. If City does so proceed to commence the reconstruction of the Pier, or any portion thereof, within eighteen (18) months after such destruction, this Agreement shall immediately again become effective and binding on both parties; or (d) Upon thirty (30) days’ prior written notice to PRC, City may terminate this Agreement at any time for "cause," as such term is hereafter defined. The term "cause" as used herein in connection with the termination of this Agreement shall mean: (1) The failure of PRC to comply with any provisions of this Agreement, where such failure is not cured by PRC within thirty (30) calendar days after written notice thereof from City (or such longer period of time as may be needed in the exercise by PRC of due diligence to effect a cure of such failure); (2) The material failure by PRC to exercise the level of managerial skill and efficiency required under this Agreement, where such failure is not cured by PRC within thirty (30) calendar days after written notice thereof from City (or such longer period of time as may be needed in the exercise by PRC of due diligence to effect a cure of such failure); or (3) Fraud, misrepresentation or breach of trust or the intentional breach of a material provision of this Agreement by PRC. Obligations Upon Termination 11.3 . Upon the termination of this Agreement by any means: (a) City shall remain bound by and indemnify PRC against obligations and expenses on all contracts, commitments and purchase orders placed or made by PRC within PRC's authority hereunder, up to the effective date of termination. City shall remain obligated to PRC for all funding, payments, reimbursements, and other compensation due to PRC pursuant to the Business Plan and this Agreement up to the effective date of termination; provided, however, City may withhold such unpaid amounts if this Agreement is terminated because of the willful misconduct, fraud, misrepresentation, or breach of trust by PRC, pending resolution of damages City has incurred, if any, because of such act or omission by PRC. (b) Upon City's payment to PRC of all funding, payments, reimbursements, and other compensation due to PRC pursuant to the Business Plan and this Agreement through the date of termination, less any offset due City under Article 8.4, PRC shall have no further rights, duties, liabilities or obligations whatsoever under this Agreement and City shall have only those rights which may arise hereunder or at law or in equity due to a breach of this Agreement by PRC. (c) PRC shall remain obligated: (1) To render to City a final accounting of income and expenses of the Pier as provided in this Agreement. (2) To deliver to City all income and all security deposits from the Pier for which PRC is responsible hereunder, if any. If any dispute exists between City and PRC concerning the payment of unpaid amounts, payment or reimbursement of expenses or other amounts to be paid under this Agreement as of the date of termination, PRC shall deposit the disputed amount (if in PRC’s possession) on the date of termination into an escrow account with an independent escrow holder which requires the agreement of both City and PRC to release the funds. (3) To deliver to City all keys, records, contracts, receipts, unpaid bills and other documents relative to the Pier and in PRC's possession at the date of termination and to assign to City all of its rights and obligations in purchase orders, contracts, warranties, and other commitments which City requests that it assign. (d) All personal property (including but not limited to equipment, hardware, trade and non-trade fixtures, materials and supplies) acquired pursuant to this Agreement or the Business Plan, whether paid for directly by City or by way of reimbursement to PRC, shall become the property of City and shall remain on the Pier at the termination of this Agreement. This Article shall survive the expiration or earlier termination of this Agreement. GENERAL PROVISIONS 12. . Notices 12.1 . All notices, approvals, demands, reports and other Notice communications provided for in this Agreement (individually, a "") shall be in writing and shall be given to such party at its address set forth below or such other address as such party may hereafter specify for the purpose by Notice to the other party listed below. Each Notice shall be deemed delivered to the party to whom it is addressed (a) if personally served or delivered, upon delivery, (b) if given by certified or registered mail, return receipt requested, deposited with the United States Mail with first-class postage prepaid, seventy-two (72) hours after such Notice is deposited with the United States Mail, (c) if given by overnight courier with overnight courier charges prepaid, twenty-four (24) hours after delivery to said overnight courier, or (d) if given by any other means, upon delivery when delivered at the following address: If to City: Office of the City Manager of the City of Santa Monica 1685 Main Street, Room 209 Santa Monica, California 90401 Attention: City Manager with a copy to: City of Santa Monica Resource Management Department 3223 Donald Douglas Loop South Santa Monica, California 90405 Attention: Economic Development Manager and Santa Monica City Attorney’s Office 1685 Main Street, Third Floor Santa Monica, California 90401 Attention: City Attorney If to PRC: Santa Monica Pier Restoration Corporation 200 Santa Monica Pier Santa Monica, California 90401 Attention: Executive Director Attorneys’ Fees 12.2 . If any action, arbitration or proceeding be commenced (including an appeal thereof) to enforce any of the provisions of this Agreement or to enforce a judgment, whether or not such action is prosecuted to judgment ("Action"), (a) the unsuccessful party therein shall pay all reasonable costs incurred by the prevailing party therein, including reasonable attorneys' fees and reasonable costs, court costs and reimbursements for any other expenses incurred in connection therewith in an amount equal to the fair market value of legal services provided by attorneys (authorized to provide such services) employed by it as well as any attorneys’ fees actually incurred for outside counsel by the prevailing party, and (b) as a separate right, severable from any other rights set forth in this Agreement, the prevailing party therein shall be entitled to recover its reasonable attorneys’ fees and costs incurred in enforcing any judgment against the unsuccessful party therein, which right to recover post-judgment attorneys' fees and costs shall be included in any such judgment. The right to recover post- judgment attorneys’ fees and costs shall (1) not be deemed waived if not included in any judgment, (2) survive the final judgment in any Action, and (3) not be deemed merged into such judgment. The rights and obligations of the parties under this Article 12.2 shall survive the termination of this Agreement. Prohibition Against Transfers 12.3 . Except for the retention of consultants, contractors or other third parties to assist the PRC in providing the management services required hereunder, PRC shall not assign, hypothecate, or transfer this Agreement or any interest therein directly or indirectly, by operation of law or otherwise without the prior written consent of City, which may be withheld at the City’s sole discretion. Any attempt to do so without the City’s consent shall be null and void, and any assignee, hypothecatee or transferee shall acquire no right or interest by reason of such attempted assignment, hypothecation or transfer. This Agreement and the rights and obligations of the City hereunder shall not be assignable by the City, voluntarily or by operation of law. Non-Discrimination 12.4 . Any contracts or agreements entered into or hiring by PRC shall comply with Title VI of the Civil Rights Act of 1964 (Public Law 88-352), Article as applicable. Any contracts awarded by PRC shall comply with the terms of this 12.4 . Amendments 12.5 . All amendments to this Agreement shall be in writing and executed by both parties. Governing Law 12.6 . This Agreement shall be governed by and construed in accordance with the laws of the State of California. Cooperation 12.7 . Should any claim, demand, action or other legal proceeding arising out of matters covered by this Agreement be made or instituted by any third party against a party to this Agreement, the other party to this Agreement shall furnish such information and reasonable assistance in defending such proceeding as may be requested by the party against whom such proceeding is brought. Waiver of Rights 12.8 . The failure of City or PRC to seek redress for violations, or to insist upon the strict performance of any covenant, agreement, provision or condition of this Agreement, shall not constitute a waiver of the terms of such covenant, agreement, provision or condition at any subsequent time, or of the terms of any other covenant, agreement, provision or condition contained in this Agreement. Subordination 12.9 . This Agreement shall not provide PRC with any interest in the Pier or right of possession and shall be and remain absolutely and unconditionally subordinate to any valid recorded mortgage on the Pier whether already or hereafter recorded. The subordination of this Agreement shall require the execution of no further documentation, but PRC agrees to execute any reasonable subordination agreement or consent to any assignment of this Agreement for security purposes which City or any lender of City requests PRC to execute. No Recourse 12.10 . Any other provisions of the Agreement notwithstanding, the parties agree that there shall be no recourse against any employee, officer, director, agent, representative or affiliate of City or PRC, including without limitation the City Council and the PRC Board, for any payments due, or the enforcement of any obligations under this Agreement; each party's liability under this Agreement shall be limited to the amount which can be recovered from such party's assets. Severability 12.11 . If any provision of this Agreement or the application thereof to any person or circumstances shall be invalid or unenforceable to any extent, the remainder of this Agreement and the application of such provisions to other persons or circumstances shall not be affected thereby and shall be enforced to the greatest extent permitted by law. No Third Party Beneficiary 12.12 . Without limiting the rights of any secured lender which receives an assignment of City's interest hereunder for security purposes, this Agreement is made solely and specifically between and for the benefit of the parties hereto, and no other person whatsoever shall have any rights, interest, or claims hereunder or be entitled to any benefits under or on account of this Agreement as a third party beneficiary or otherwise. No Lien 12.13 . This Agreement does not create a lien of any kind upon the Pier or any other real or personal property. Integration 12.14 . Subject to any currently existing Business Plan, this Agreement and any Exhibits attached hereto and made a part hereof set forth the entire agreement and understanding of the parties with respect to the subject matter hereof, supersede and take the place of any and all previous agreements entered into between the parties hereto relating to the subject matter of this Agreement. Nuisance 12.15 . PRC shall not maintain, commit, or permit the maintenance or commission of any nuisance on the Pier in connection with the performance of services under this Agreement. / / / / / / / / / IN WITNESS WHEREOF, City and PRC have executed this Agreement as of the day and year first above written. CITY OF SANTA MONICA a municipal corporation By: SUSAN E. McCARTHY City Manager Approved as to Form MARSHA JONES MOUTRIE City Attorney Attest: MARIA STEWART City Clerk SANTA MONICA PIER RESTORATION CORPORATION a non-profit public benefit corporation By: Name: Title:_____________________________ By: Name: Title:_____________________________ EXHIBIT "A" DESCRIPTION OF PIER 1 TABLE OF CONTENTS Page 1. RECITALS…………………………………………………………………2 2. ASSIGNMENT AND AUTHORITY OF PRC…………………………….2 3. GENERAL RESPONSIBILITIES………………………………………….2 3.1 General ……………………………………………….2 3.2 Standard of Care……………………………………...3 4. BUSINESS PLAN AND PIER BUDGET…………………………………3 4.1 Annual Business Plan………………………………...3 4.2 Annual Pier Budget…………………………………..4 4.3 Business Plan and Pier Budget Review………………5 4.4 Implementation of Business Plan and Pier Budget…...5 4.5 Performance Within Pier Budget…………………….5 4.6 Accounts, Books and Records………………………..5 4.7 Accounting……………………………………………6 4.8 Copies of Books and Records………………………...6 4.9 Miscellaneous Reports and Information……………...7 5. LEASING…………………………………………………………………..7 5.1 PRC Leasing Responsibilities………………………...7 5.2 City Leasing Responsibilities………………………...8 5.3 No Commission………………………………………9 6. SPECIFIC MANAGEMENT RESPONSIBILITIES ………………………9 6.1 Planning and Development…………………………...9 6.2 Corporate Sponsorships……………………………..10 6.3 Marketing and Promotion…………………………...10 6.4 Special Events……………………………………….10 6.5 Filming at the Pier…………………………………...11 6.6 Marks………………………………………………..11 6.7 Security……………………………………………...11 6.8 Janitorial/Custodial………………………………….11 6.9 Repairs and Maintenance……………………………11 6.10 Capital Improvements……………………………….12 6.11 City Inspection………………………………………12 7. METHODS OF OPERATION……………………………………………12 7.1 Contracting………………………………………….12 7.2 Compliance with Laws ……………………………12 7.3 Employment of Personnel…………………………..13 8. FINANCIAL MATTERS…………………………………………………14 8.1 PRC Account………………………………………..14 8.2 Payment of Bills……………………………………..14 8.3 Deposit of Revenues………………………………...14 8.4 Reimbursement of Marketing Funds………………..15 9. FUNDING OF PRC……………………………………………………….15 9.1 Funding……………………………………………...15 9.2 Employee Compensation……………………………15 9.3 Out-of-Pocket Expenses, Office and Other Services..16 9.4 Payment and Record of Expenses…………………...16 9.5 Role of PRC…………………………………………16 9.6 Matters Beyond PRC Responsibility………………..16 9.7 Reversion of Property……………………………….16 10. INDEMNIFICATION AND INSURANCE ……………………………...17 10.1 Indemnity by City…………………………………...17 10.2 PRC's Insurance……………………………………..17 10.3 Third Party Indemnity……………………………….18 10.4 City’s Insurance……………………………………..18 11. TERM OF AGREEMENT………………………………………………...19 11.1 Term…………………………………………………19 11.2 Early Termination…………………………………...19 11.3 Obligations Upon Termination ……………………..20 12. GENERAL PROVISIONS………………………………………………..21 12.1 Notices ……………………………………………...21 12.2 Attorneys’ Fees……………………………………...22 12.3 Prohibition Against Transfers……………………….22 12.4 Non-Discrimination…………………………………23 12.5 Amendments………………………………………...23 12.6 Governing Law……………………………………...23 12.7 Cooperation………………………………………….23 12.8 Waiver of Rights…………………………………….23 12.9 Subordination………………………………………..23 12.10 No Recourse…………………………………………23 12.11 Severability………………………………………….24 12.12 No Third Party Beneficiary………………………….24 12.13 No Lien……………………………………………...24 12.14 Integration…………………………………………...24 12.15 Nuisance……………………………………………..24 ATTACHMENT B SANTA MONICA PIER LEASING GUIDELINES GUIDELINE OBJECTIVES Promote and maintain the compatibility of use of City-owned property located on the Santa Monica Pier in a manner supporting an attractive, safe and accessible environment for visitors and the residential community; preserve and enhance the Preferred Uses through operation of the facility in a manner supporting diverse and affordable public recreational and community asset; establish the pricing of leasehold occupancy consistent with optimizing the Preferred Uses and assisting in the support of fiscal self-sufficiency of the Pier Fund; and assure access to and use of City-owned properties by the general public for the Preferred Uses through a leasing program that promotes the orderly management of tenancies. PREFERRED USES Current uses of City-owned structures and deck area on Santa Monica Pier are diverse, and have been intended to preserve the Pier as a unique community recreational resource. The Pier is an internationally recognized attraction serving residents and visitors representing a broad range of incomes, ages and lifestyles. The current lease and license agreements represent the implementation of the Santa Monica Pier Development Program adopted in 1988. Diversity will be maintained but focused on those purposes that support the historic character of the Pier and offer choices of services and pricing within the general use categories while retaining the intended emphasis on low density, unique recreational and entertainment-oriented activities. Preferred Uses include, but are not limited to, a range of entertainment and commercial products and services that will appeal to and serve both the residential community and area visitors. Buildings and deck area on Santa Monica Pier that are and will be available for lease or license, and associated Preferred Uses for each, consist of the following: ? 1600 Oceanfront Walk – 4,533 s.f. enclosed structure area Current Operation: UCLA Ocean Discovery Center Lease Term: 8 years, commencing 7-1-95 Preferred Use: marine research and educational facility accessible to the public ? 200 Santa Monica Pier – 8,236 s.f. enclosed structure area Current Operation: Carousel and related retail activities Lease Term: Month-to-month. Trafton Operating Agreement expired 6-30-00 Preferred Use: public access to Carousel at supported pricing, and evening/off-hours use of the Carousel building for parties, receptions and special events ? 250 Santa Monica Pier – 5,015 s.f. enclosed structure and 1,064 s.f. patio area Current Operation: The Arcadia Lease Term: 20 years, commencing 10-27-98 Preferred Use: music and entertainment venue with food and beverage service ? 256 Santa Monica Pier – 3,035 s.f. enclosed structure and 1,073 s.f. patio area Current Operation: Rusty’s Surf Ranch Lease Term: 20 years, commencing 11-1-94 Preferred Use: full service restaurant with music and entertainment ? 258 Santa Monica Pier – 2,557 s.f. enclosed structure and 1,392 s.f. patio area Current Operation: Santa Monica Pier Seafood Lease Term: 23 years, commencing 5-1-91 Preferred Use: limited or full service family-oriented restaurant ? 301 Santa Monica Pier – 4,534 s.f. enclosed structure and 2,198 s.f. patio area Current Operation: Boathouse Restaurant Lease Term: Month-to-month. Lease expired 6-30-98 Preferred Use: limited or full service family-oriented restaurant ? 310 Santa Monica Pier – 1,292 s.f. enclosed structure Current Operation: Blazing Saddles Bicycle Rentals and Sales Lease Term: 43 months, commencing 4-1-00 Preferred Use: recreation-oriented rentals and sales ? 330 Santa Monica Pier – 1,525 s.f. enclosed structure and 584 s.f. patio area Current Operation: Surf View Café Lease Term: Month-to-month Preferred Use: limited service convenience restaurant ? 350 Santa Monica Pier – 8,603 s.f. enclosed structure and 641 s.f. patio area Current Operation: Playland Arcade Lease Term: Twenty years, expiring June 30, 2010 Preferred Use: amusement and self-operated games arcade with ancillary retail sales ? 370 Santa Monica Pier – 12,085 s.f. gross deck area Current Operation: Club Route 66 (not yet constructed) Lease Term: 40 years, not yet commenced Preferred Use: full service restaurant with music and entertainment ? 380 Santa Monica Pier – 75,000 s.f. gross (56,891 s.f. net) deck area Current Operation: Pacific Park Lease Term: 50 years, commencing 5-26-96 Preferred Use: amusement rides and games with ancillary retail sales and fast food ? 401 Santa Monica Pier – 6,204 s.f. enclosed structure and 2,217 s.f. patio area Current Operation: Mariasol Restaurant Lease Term: 35 years, commencing 1-1-91 Preferred Use: limited or full service family-oriented restaurant ? 404 Santa Monica Pier – 292 s.f. enclosed structure Current Operation: Santa Monica Pier Bait & Tackle Lease Term: Month-to-month. Lease expired 6-30-98 Preferred Use: fishing bait and tackle sales with ancillary retail sales and fast food ? Municipal Pier Deck Area Current Operation: Promenade Services Vending Cart Program License Term: Month-to-month Preferred Use: Pier and/or beach-oriented retail sales and services ? Santa Monica Harbor Moorings Current Operation: 12 vessel moorings, with at least eight available for commercial boating activities, one for public safety, three for transient/harbor of refuge (project subject to EIR; not yet constructed) License Term: commercial vessels, one year; transient, 72-hours Preferred Use: sportfishing, scuba, and harbor tour vessel operations DESIGN GUIDELINES The historic character and eclectic appearance of the Pier are important aesthetic elements to be retained, preserved and enhanced. The City has previously adopted Design Guidelines to serve as a standard for the Pier. All structural modifications and other improvements both public and private proposed for implementation on the Pier will be subject to review for consistency with the Design Guidelines, without exception. If tenants must make improvements to structures on the Pier deck or build new structures to implement the Preferred Uses as a mutually agreed condition of a lease, the City must first review and approve the proposed scope of work and improvement design in accordance with the Design Guidelines. All necessary architectural reviews and building permits must be obtained, and the work inspected for compliance with applicable codes. LOCAL PREFERENCE The controlled scope of commercial development and casual recreational ambiance are important factors in defining the unique character of Santa Monica Pier. Leasing and licensing of City-owned buildings and Pier deck area will be subject to a preference for local independent, non-formula businesses and activities that are financially and operationally capable of providing the Preferred Uses. A formula business is that which requires by contractual or other arrangement the maintenance of standardized services, décor, uniforms, facility design and format substantially identical to another operation. RENEWAL OPTIONS Lease renewals or options to extend the terms of occupancy will not be offered to existing tenants or to new tenants, with two current exceptions. As vacancies arise either by lease expiration or earlier termination, recruitment for occupancy will be conducted in accordance with the Leasing Guidelines. Changes to portions of the Pier deck area, including the site of Surf View Café, may occur within the ensuing three years. Restoration of a portion of Santa Monica Breakwater and installation of 12 commercial vessel moorings and landing may also occur within the ensuing three years, prospectively affecting operation of Santa Monica Pier Bait & Tackle. It is recommended that the two current tenants be offered leases terminating June 30, 2003, conditioned upon cosmetic structural and signage improvements to the premises. TERM OF YEARS As vacancies arise either by lease/license expiration or earlier termination, available space will be offered for lease for Preferred Uses for non-renewable five-year terms if substantial new capital investment in structures, structural improvements or equipment is not warranted. If a tenant is required to make substantial new capital investment in structures, structural improvements or equipment to implement the Preferred Use consistent with intended purposes of the premises, lease terms of ten years to twenty-five years varying with financial requirements of the investment. Prospective tenants for licenses or leasing of vacant space will be selected from responses to public Requests for Qualifications and/or Requests for Proposals. City staff pursuant to Tenant Recruitment procedures will receive applications for each Preferred Use. Prospective tenants will be screened for responsiveness to the public solicitation, confirmation of credit-worthiness, confirmation of operational capability, anticipated effect on parking space ratios, anticipated effect on the Pier substructure and related issues. EXPANSION OF LEASEHOLD S In order to provide access to and use of the leasehold opportunities of Santa Monica Pier buildings and deck to as many prospective tenants as possible, physical expansion of existing and leasehold occupancies will not be accommodated if the number or diversity of commercial activities are adversely affected. PERIODIC REVIEW OF RENTAL RATES Minimum rents and participation by City in percentage rents based on gross receipts from commercial lease and license activities will be established at estimated fair market rates and set forth in any public Request for Qualifications and/or Request for Proposals issued for any available leasehold or license opportunities. Responses received for lease and license opportunities may exceed the minimum and percentage rents set forth in the Requests. Leaseholds with Preferred Uses for research and public educational purposes (e.g. UCLA Ocean Discovery Center) and Operating Agreements subject to supported pricing standards (e.g. Carousel) will be maintained without application of fair market rental rates. The City will seek to reasonably minimize its costs associated with these activities by recovering Common Area Maintenance costs from leaseholds and participating in ancillary gross receipts from commercial activities at educational facilities and the Carousel. COMMON AREA MAINTENANCE COSTS Leasehold tenants will pay as a condition of occupancy of Pier building or deck areas a proportionate share of the City’s cost to manage, maintain and provide security to Santa Monica Pier. As of January 1, 2000, the applied Common Area Maintenance cost is $5.00 per leased square foot per year, increasing with CPI adjusted as of July 1 biennially. Monthly payment of Common Area Maintenance costs as additional rent will be a condition of each lease granted for the Pier. The Common Area Maintenance cost will be reanalyzed and adjusted on five-year intervals, commencing with July 1, 2000. FACILITY CONDITION REVIEW All City-owned structures and deck area available for lease will be inspected prior to new leasehold occupancy and brought by the City or new tenant to a decent, safe and sanitary condition appropriate for the Preferred Use. If tenants must make improvements to a building or deck area to implement the Preferred Uses as a mutually agreed condition of a lease, City staff will first review and approve the proposed scope of work and improvement design. The proposed scope of work and improvement design will be provided by the prospective tenant in accordance with Tenant Recruitment procedures. All improvements on the Pier shall be in accordance with the Design Guidelines. All necessary building permits must be obtained, and the work inspected for compliance with applicable codes. Appropriate rental credits for the approved work performed would be negotiated as part of the lease. TENANCY RELATIONSHIPS All City-owned buildings and deck areas on Santa Monica Pier appropriate and suitable for leasing or licensing by the City to individual tenancies or licensees for the Preferred Uses will be in accordance with agreements prepared by the City. Each tenant or licensee would be responsible for interior maintenance and repair and utility consumption at its expense, and the City would retain responsibility for maintenance and repair of roofs and exterior of its buildings. Structures constructed by tenants for the Preferred Uses would be subject to interior and exterior maintenance and repair by the tenant at its expense. Subletting of leased premises is explicitly prohibited. TENANT RECRUITMENT All City-owned buildings and deck areas on Santa Monica Pier appropriate and suitable for leasing or licensing will be subject to a public marketing and solicitation process to identify prospective tenants and licensees with financial and experience qualifications for the Preferred Use of the available space. Vacancies will be the subject of public Requests for Qualifications and/or Requests for Proposals publicized utilizing: ? Media advertising, including general circulation newspapers or local/limited circulation publications ? Direct mail to waiting list and/or other targeted individuals having expressed previous interest in leasehold occupancy or license operation for the available Preferred Use ? Posting notice on the Pier Restoration Corporation’s, City’s and Resource Management Department’s internet web site As appropriate, vacancies may also be publicized utilizing: ? Direct contact or outreach to prospective tenants ? Dissemination by fax, e-mail or telephone to local commercial real estate brokers ? Press releases and other direct marketing performed by the PRC Requests for Qualifications and/or Requests for Proposals will be drafted by City staff and approved prior to release by the Leasing Committee of the PRC. The Request for Qualifications and/or Request for Proposals will set forth the Preferred Uses of the available space, proposed terms and conditions for the leasehold or license opportunity, and criteria for reviewing and rating responses. All respondents and prospective tenants will file a Lease Application. Information contained in the Lease Application will be utilized for confirmation that the proposed tenancy is a Preferred Use for the available space, and verification of experience, references and financial capability to perform leasehold obligations. Responses will also state preliminary terms and conditions for the proposed lease or license. Responses to Request for Qualifications and/or Request for Proposals will be analyzed and rated by a review team comprised of City staff and the Executive Director of the PRC. Representatives of City Engineering Division and/or Planning and Community Development may be included as appropriate. The review team will provide its analysis and recommendation as to a preferred respondent to the Leasing Committee of the PRC. The recommendation may be to reject all responses, solicit additional information from one or more respondent, or to enter exclusive lease or license negotiations with a preferred respondent. The Leasing Committee will receive the review team analysis, and make its recommendation the PRC Board. The Board may authorize City staff to enter exclusive negotiations with a preferred respondent subject to specific terms and conditions, or it may reject all responses or direct that additional information be solicited from one or more respondent prior to making a determination. City staff will conduct exclusive negotiations with a preferred respondent as authorized by the PRC Board. All term sheets and lease or license agreements will be prepared by the City Attorney for review and execution by the prospective tenant or licensee. The executed agreement will be submitted to the Leasing Committee for its review in terms of consistency with the PRC Board authorization. If determined to be in accordance with the authorization to enter exclusive negotiations, the lease or license will be recommended to the PRC Board for approval. Upon approval of a lease or license by the PRC Board, the agreement will be approved as to form by the City Attorney and transmitted to the City Manager for execution. The City will neither pay nor receive commissions for leasing of City-owned property. Staff will cooperate with commercial real estate brokers who are authorized to negotiate leases and licenses on behalf of prospective tenants. ATTACHMENT C Amended and Restated Bylaws of Santa Monica Pier Restoration Corporation a California nonprofit public benefit corporation Article I. Offices Section 1 Principal Office. The corporation's principal office shall be fixed and located at such place in the City of Santa Monica, California as the Board of Directors (herein called the "Board") shall determine. The Board is granted full power and authority to change said principal office from one location to another. Section 2. Other Offices. Branch or subordinate offices may be established at any time by the Board at any place or places. Article II. Members Section 1. Member. The City of Santa Monica shall be the sole Member (herein called the "Member" of this corporation and shall act through its City Council (the "City Council") in accordance with the City Charter, the City's Municipal Code and the applicable state laws. The function of the Member shall be to elect the Board of Directors, to initiate and approve any amendment to these Bylaws, to approve the corporation's budget and to perform other duties as the Board of Directors may from time to time assign or establish with the prior approval of the Member. Section 2. Meetings of Member. There shall be an annual meeting of the Member of this corporation held each year during the second week of November or as soon thereafter as possible at such time and place as may be determined by the Member. A special meeting of the Member may be held upon call by the Member. All meetings of the Member shall be conducted at meetings of the City Council, and shall be placed on the agenda of the City Council meetings in accordance with the City Council's regular procedures. Section 3. Notice of Meetings. Written notice of each annual or special meeting shall be given to the Member either personally or by mail or other means of written communication, charges prepaid, addressed to such Member as follows: City of Santa Monica, 1685 Main Street, Santa Monica, California 90401, Attention: Office of the City Clerk or to such other address or addresses as shall be given by it to the corporation for the purposes of notice. All such notices shall be sent to the Member not fewer than ten (10) nor more than ninety (90) days before each meeting; shall specify the place, day and hour of such meeting; shall state the general matter of the business or proposal to be considered or acted upon at such meeting; and shall contain a request that the City Clerk ("City Clerk") of the City of Santa Monica give such public notice of the meeting as may be required by the Ralph M. Brown Act (California Government Code sections 54950 et seq.). Such notice shall also be given to the City Manager (the "City Manager") of the City of SantaMonica. Such notice shall comply with section 5511 of the California Nonprofit Public Benefit Corporation Law. Section 4. Quorum . The presence in person of a majority of the City Council shall constitute a quorum for the transaction of business at all meetings. Section 5. Action . Membership action shall be effective upon written notification to the corporation by the City Clerk. Section 6. Associates . Nothing in the Article II shall be construed as limiting the right of the corporation to refer to persons associated with it as "members" even though such persons are not members, and no such reference shall constitute anyone a member, within the meaning of Section 5056 of the California Nonprofit Public Benefit Corporation Law. The corporation may confer by amendment of its Articles or of these Bylaws some or all of the rights of a member, as set forth in the California Nonprofit Public Benefit Corporation Law, upon any person or persons who do not have the right to vote for the election of directors or on a disposition of substantially all of the assets of the corporation or on a merger or on a dissolution or on changes to the corporation's Articles or Bylaws, but no such person shall be a member within the meaning of said Section 5056. Article III. Directors Section 1. Powers . Subject to limitations of the Articles and these Bylaws, the activities and affairs of the corporation shall be conducted and all corporate powers shall be exercised by or under the direction of the Board. The Board may delegate the management of the activities of the corporation to an Executive Director and Staff, to any other person or persons, or to committees however composed, including, without limitation, the Executive Committee referred to in Section 15 of this Article III below, provided that the activities and affairs of the corporation shall be managed and all corporate powers shall be exercised under the ultimate direction of the Board. Without prejudice to such general powers, but subject to the same limitations, it is hereby expressly declared that the Board shall have the following powers in addition to the other powers enumerated in these Bylaws: (a) To select and remove an Executive Director, officers, agents, and employees of the corporation, prescribe powers and duties for them as may not be inconsistent with law, the Articles, or these Bylaws, fix their compensation, and require from them security for faithful service; provided, however, that the selection of the Executive Director of the corporation shall be subject to the express written consent of the City Manager. (b) To adopt, make and use a corporate seal and to alter the form of such seal from time to time as they may deem best. (c) To borrow money and incur indebtedness for the purposes of the corporation, and to cause to be executed and delivered therefor, in the corporate name, promissory notes, bonds, debentures, deeds of trust, mortgages, pledges, hypothecations, or other evidences of debt and securities therefor, subject, however, to the prior written approval of the Member. (d) To carry on a business at a profit and apply any profit that results from the business activity to any activity in which it may lawfully engage, subject, however, to the restrictions contained in the Articles. (e) To assist the Executive Director and Chief Financial Officer in the establishment of a budget for the corporation with the Member, and to oversee implementation of the budget by the Executive Director. (f) To act as an advocate for the Santa Monica Pier before the citizens of the City of Santa Monica and the Member, as well as to act to implement the goals of such citizens and the Member with respect to the Santa Monica Pier. Without limiting the generality or specificity of the foregoing, the Board generally shall delegate the daily management of the operations and affairs of the corporation to its Executive Director and/or its Executive Committee shall oversee such management and shall establish policies and procedures therefor. Section 2. Number of Directors . The authorized number of directors shall be eleven (11) until changed by amendment of the Articles or by a Bylaw. Section 3. Election and Term of Office . Directors shall be elected by the Member. Directors shall serve for a term of four years. Notwithstanding the foregoing, Directors shall be appointed and hold office consistent with Member policy. The Member shall adopt a nomination and election procedure that will comply with Section 5520 of the California Nonprofit Public Benefit Corporation Law. Section 4. Vacancies . Subject to the provisions of Section 5226 of the California Nonprofit Public Benefit Corporation Law, any director may resign effective upon giving written notice to the Chair of the Board, the Secretary, or the Board, unless the notice specifies a later time for the effectiveness of such resignation. If the resignation is effective at a future time, a successor may be elected before such time, to take office when the resignation becomes effective. Vacancies in the Board shall be filled by the Member. Each director so selected shall hold office until the expiration of the term of the replaced director and until a successor has been elected and qualified. A vacancy or vacancies in the Board shall be deemed to exist in case of the death, resignation, or removal of any director, or if the authorized number of directors is increased. The Board may declare vacant the office of a director who has been declared of unsound mind by a final order of court, or convicted of a felony, or found by a final order or judgment of any court to have breached any duty arising under Article 3 of the California Nonprofit Public Benefit Corporation Law or who has failed to attend six (6) regular meetings of the Board within a twelve (12) month period. A director may be removed without cause by the vote of five (5) City Council members. A removed director's successor may be elected immediately. No reduction of the authorized number of directors shall have the effect of removing any director prior to the expiration of the director's term of office. Section 5. Place of Meeting . Meetings of the Board shall be held at any place within the City of Santa Monica, State of California which is open to the public and which has been designated from time to time by the Board. In the absence of such designation, regular meetings shall be held at the principal office of the corporation, in which case the principal office of the corporation shall be open to the public for the meeting of the Board. Section 6. Annual Meetings . The Board shall hold an annual meeting for the purpose of organization, election of officers, and the transaction of other business. Section 7. Regular Meetings . Regular meetings of the Board shall be held on such dates and at such times as may be fixed by the Board. At least ten (10) monthly meetings shall be held during each full fiscal year. Notice of regular meetings shall be published once in a newspaper of general circulation in the City of Santa Monica and shall be sent to the City Clerk and the City Manager not fewer than four (4) nor more than ten (10) days before such meeting. The notice shall specify the business intended to be conducted at the meeting, but any business transacted at such meeting shall be validly conducted, so long as not otherwise inconsistent with law, the Articles or these Bylaws. Section 8. Special Meetings . Special meetings of the Board for any purpose or purposes may be called at any time by the Chair of the Board, the Executive Director, any Vice Chair, the Secretary, or any seven (7) directors. Special meetings of the Board shall be held upon four days notice by first- class mail or 48 hours notice given personally or by telephone, telegraph, telex, or other similar means of communication. Any such notice shall be addressed or delivered to each director at such director's address as it is shown upon the records of the corporation or as may have been given to the corporation by the director for purposes of notice or, if such address is not shown on such records or is not readily ascertainable, at the place in which the meetings of the directors are regularly held. Such notice shall also be given to: (a) Two (2) daily newspapers of general circulation in the City of Santa Monica; (b) such other news media in the County of Los Angeles that has filed a written request therefor with the Secretary of the corporation; and (c) the City Clerk and the City Manager. The notice shall specify the purpose of the meeting, but any business transacted at such meeting shall be validly conducted, so long as not otherwise inconsistent with law, the Articles or these Bylaws. Notice by mail shall be deemed to have been given at the time a written notice is deposited in the United States mails, postage prepaid. Any other written notice shall be deemed to have been given at the time it is personally delivered to the recipient or is delivered to a common carrier for transmission, or actually transmitted by the person giving the notice by electronic means, to the recipient. Oral notice shall be deemed to have been given at the time it is communicated, in person or by telephone or wireless, to the recipient or to a person at the office of the recipient who the person giving the notice has reason to believe will promptly communicate it to the receiver. Section 9. Quorum . Seven (7) directors constitute a quorum of the Board for the transaction of business, except to adjourn as provided in Section 12 of the Article III. Every act or decision done or made by a majority of the number of directors authorized by these Bylaws shall be regarded as the act of the Board, unless a greater number is required by law, by the Articles or by these Bylaws. Section 10. Participation in Meetings by Conference Telephone . Members of the Board may participate in a meeting through use of conference telephone or similar communications equipment, so long as all persons participating in or present at such meeting can hear one another, and so long as not less than a quorum of the Board is present in person at the meeting. In order to vote at such a meeting, any director participating through the use of conference telephone or similar communications equipment must have so participated for the entire portion of such meeting preceding such vote. Section 11. Waiver of Notice . Notice of a meeting need not be given to any director who signs a waiver of notice or a written consent to holding the meeting or an approval of the minutes thereof, whether before or after the meeting, or who attends the meeting without protesting, prior thereto or at its commencement, the lack of notice to such director. All such waivers, consents, and approvals shall be filed with the corporate records or made a part of the minutes of the meetings. Section 12. Adjournment . A majority of the directors present, whether or not a quorum is present, may adjourn any directors' meeting to another time and place. Notice of the time and place of holding an adjourned meeting need not be given to absent directors, nor to the news media, the City Clerk or the City Manager if the time and place is fixed at the meeting adjourned, except as provided in the next two sentences. If the meeting is adjourned for more than seventy-two (72) hours, notice of any adjournment to another time or place shall be given prior to the time of the adjourned meeting to the directors who were not present at the time of the adjournment. A written notice of adjournment setting forth the time and place of the adjourned meeting shall be conspicuously posted on or near the door of the place where the regular, adjourned regular, special or adjourned special meeting was held within 24 hours after the time of adjournment, and shall remain posted until at least the time specified therein for the commencement of the adjourned meeting. Section 13. Public Meetings . All meetings of the Board shall be open and public, and any person shall be permitted to attend any meeting of the Board, except as otherwise provided in this section. Members of the public shall be entitled to participate in accordance with such rules as may be adopted by the board from time to time. Nothing contained in this section or these Bylaws shall be construed to prevent the Board from holding closed sessions to the extent permitted by applicable law (a) for the purpose of discussing matters related to litigation, including pending, threatened or anticipated litigation; (b) to consider the appointment, employment, evaluation of performance, or dismissal of an employee or to hear complaints or charges brought against an employee by another person or employee unless such employee requests a public hearing or (c) for such other purposes as may be permitted by the Ralph M. Brown Act (California Government code Sections 54950 et seq.); provided, however, that the final vote of the Board on any action to be taken by the corporation with respect to the appointment, employment or dismissal of an employee shall be taken at a meeting of the Board while such meeting is open to the public. Section 14. Right of lnspection. Every director shall have the absolute right at any reasonable time to inspect and copy all books, records, and documents of every kind and to inspect the physical properties of the corporation. Section 15. Committees . The Board may appoint one or more committees, each consisting of two or more directors, and delegate to such committees any of the authority of the Board except with respect to: (a) The approval of any action for which the California Nonprofit Public Benefit Corporation Law also requires approval of the members or approval of a majority of all members; (b) The filling of vacancies on the Board or in any committee which has the authority of the Board; (c) The fixing of compensation of the directors for serving on the Board or on any committee; (d) The amendment or repeal of bylaws or the adoption of new bylaws; (e) The amendment or repeal of any resolution of the Board which by its express terms is not so amendable or repealable; (f) The appointment of other committees of the Board or the members thereof; (g) The expenditure of corporate funds to support a nominee for director; or (h) The approval of any self-dealing transaction, as such transactions are defined Section 5233(a) of the California Nonprofit Public Benefit Corporation Law. Without limiting the foregoing, the primary purpose of the committees of the Board shall be to advise the Executive Director with respect to the Executive Director's management of the affairs and operations of the corporation and to advise the Board as a whole with respect to the establishment of general policy and direction of the corporation. Any such committee must be created, and the members thereof appointed, by resolution adopted by a majority of the authorized number of directors then in office, provided a quorum is present, and any such committee may be designated an Executive Committee or by such other name as the Board shall specify. The Board may appoint, in the same manner, alternate members of any committee who may replace any absent member at any meeting of the committee. The Board shall have the power to prescribe the manner in which proceedings of any such committee shall be conducted. In the absence of any such prescription, such committee shall have the power to prescribe the manner in which its proceedings shall be conducted. Unless the board or such committee shall otherwise provide, the regular and special meetings and other actions of any such committee shall be governed by the provisions of this Article III applicable to meetings and actions of the Board. Minutes shall be kept of each meeting of each committee. Section 16. Fees and Compensation . Directors and members 'of committees shall receive no compensation for their services as such directors or members, but may receive reimbursement for expenses, as may be fixed or determined by the Board. Article IV. Transactions In Which Directors Have Material Financial Interest Section 1. Prohibition Against Self-Dealing Transactions . The corporation shall not enter into any transaction in which one or more of its directors has a material financial interest, unless the transaction meets the requirements of paragraph (a), (b) or (c) of Section 2 of this Article IV. For purposes of this Article IV, a "self-dealing transaction" means a transaction to which the corporation is a party and in which one or more of its directors has a material financial interest. For purposes of this Article IV, such a director is referred to an "interested director." This section shall not be construed to prohibit (a) a transaction which is part of a public or charitable program of the corporation if it: (i) is approved or authorized by the corporation in good faith and without unjust favoritism; and (ii) results in a benefit to one or more directors or their families because they are in the class of persons intended to be benefited by the public or charitable program; or (b) a transaction, of which the interested director or directors have no actual knowledge, and which does not exceed the lesser of 1 percent of the gross receipts of the corporation for the preceding fiscal year or one hundred thousand dollars (100,000). Section 2. Prohibited Loans and Guarantees . The corporation shall not make any loan of money or property to or guarantee the obligation of any director or officer, unless approved by the California Attorney General, except that: (a) The corporation may advance money to a director or officer of the corporation for expenses reasonably anticipated to be incurred in the performance of the duties of such officer or director, provided that in the absence of such advance, such director or officer would be entitled to be reimbursed for such expenses by the corporation; and (b) The corporation may pay premiums in whole or in part on a life insurance policy on the life of the director or officer so long as repayment to the corporation of the amount paid by it is secured by the proceeds of the policy and its cash surrender value. Article V. Officers Section 1. Officers . The officers of the corporation shall be a Chair of the Board, an Executive Director, a Secretary, a Treasurer and a Chief Financial Officer. The corporation may also have, at the discretion of the Board, one or more Vice- Chairs, one or more Assistant Secretaries, one or more Assistant Treasurers and such other officers as may be elected or appointed in accordance with the provisions of Section 3 of this Article V. Any number of offices may be held by the same person except as provided in the Articles or in these Bylaws and except that neither the Secretary, any Assistant Secretary, the Treasurer,the ChiefFinancial Officer, nor any Assistant Treasurer may serve concurrently as the Executive Director or the Chair of the Board. Section 2. Election . The officers of the corporation, except the Executive Director and such other officers as may be elected or appointed in accordance with the provisions of Section 3 or Section 5 of this Article V, shall be chosen annually by, and shall serve at the pleasure of, the Board, and shall hold their respective offices until their resignation, removal, or other disqualification from service, or until their respective successors shall be elected. Section 3. Subordinate Officers . The Board may elect, and may empower the Chair of the Board to appoint, the Executive Director and such other officers as the business of the corporation may require, each of whom shall hold office for such period, have such authority, and perform such, duties as are provided in these Bylaws or as the Board may from time to time determine. Section 4. Removal and Resignation . Any officer may be removed, either with or without cause, by the Board at any time or, except in the case of an officer chosen by the Board, by any officer upon whom such power of removal may be conferred by the Board. Any such removal shall be without prejudice to the rights, if any, of the officer under any contract of employment of the officer. Any officer may resign at any time by giving written notice to the corporation, but without prejudice to the rights, if any, of the corporation under any contract to which the officer is a party. Any such resignation shall take effect at the date of the receipt of such notice or at any later time specified therein and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Section 5. Vacancies . A vacancy in any office because of death, resignation, removal, disqualification, or any other cause shall be filled in the manner prescribed in these Bylaws for regular election or appointment to such office, provided that such vacancies shall be filled as they occur and not on an annual basis. Section 6. Chair of the Board. The Chair of the Board shall, if present, preside at all meetings of the Board and exercise and perform such other powers and duties as may be assigned from time to time by the Board. The Chair of the Board must be a director of the corporation. Section 7. Executive Director . Subject to such powers, if any, as may be given by the Board to the Chair of the Board, the Executive Director shall be the chief executive officer and chief operating officer of the corporation and shall have, subject to the control of the Board, general supervision, direction and control of the business and other officers of the corporation. At the Board's discretion, the Executive Director shall have the general powers and duties of management usually vested in the office of the president of a corporation and such other powers and duties as may be prescribed by the Board. Without limiting the generality or specificity of the foregoing, with the advice of the Board and any committees of the Board, the Executive Director shall be the primary authority and representative of the corporation in dealing with the Member and shall have the authority and responsibility to manage the day to day affairs of the corporation, including, without limitation, the budget of the corporation and other financial matters of the corporation in concert with the Chief Financial Officer, subject to the oversight and general direction of the Board. The Executive Director shall not be a director of the corporation. Section 8. Vice Chairs . In the absence or disability of the Chair of the Board, the Vice-Chairs, if any are appointed, in order of their rank as fixed by the Board or, if not ranked, the Vice-Chair designated by the Board, shall preside at meetings of the Board and shall perform all the duties of, and be subject to all the restrictions upon, the chair of the Board. The Vice-Chairs shall have such other powers and perform such other duties as from time to time may be prescribed for them respectively by the Board. All Vice-Chairs must be directors of the corporation. Section 9. Secretary . The Secretary shall keep or cause to be kept, at the principal office or such other place as the Board may order, a book of minutes of all meetings of the Board and its committees, with the time and place of holding, whether regular or special, and if special, how authorized, the notice thereof given, the names of those present at Board and committee meetings, and the proceedings thereof. The Secretary shall keep, or cause to be kept, at the principal office in the State of California, the original or a copy of the corporation's Articles and Bylaws, as amended to date. The Secretary shall give, or cause to be given, notice of all meetings of the Board and any committees thereof required by these Bylaws or by law to be given, shall keep the seal of the corporation in safe custody, and shall have such other powers and perform such other duties as may be prescribed by the Board. In the absence or disability of the Chair of the Board and all Vice-Chairs, the Secretary shall preside at meetings of the Board of the Secretary is a director of the corporation. The Secretary may but need not be a director of the corporation. Section 10. Treasurer . The Treasurer shall have such duties and responsibilities with respect to the finances and accounts of the corporation as may be prescribed for the Treasurer by the Board from time to time, which may include, without limitation, supervising the activities of the Chief Financial Officer and chairing any audit or budget committee established by the Board. In the absence or disability of the Chair of the Board, all Vice-Chairs, and the Secretary, the Treasurer shall preside at meetings of the Board. The Treasurer must be a director of the corporation. Section 11. Chief Financial Officer . The Chief Financial Officer shall keep and maintain, or cause to be kept and maintained, adequate and correct accounts of the properties and business transactions of the corporation. The books of account shall at all times be open to inspection by any director. The Chief Financial Officer shall deposit all moneys and other valuables in the name and to the credit of the corporation with such may be designated by the Board. The Chief Financial Officer shall disburse the funds of the corporation as may be ordered by the Board, shall render to the Executive Director and directors, whenever they request it, an account of all transactions as Chief Financial Officer and of the financial condition of the corporation, and shall have such other powers and perform such other duties as may be prescribed by the Board. The Chief Financial Officer may but need not be a director of the corporation. Article VI. Reports, Records And Rights Of Inspection Section 1. Annual Report to Member . Within ninety (90) days after the close of the corporation's fiscal year, the Board shall cause an annual report of its operations to be provided to the City Council. Such report shall contain, in appropriate detail, the following: (a) The assets and liabilities, including the trust funds, of the corporation as of the end of the fiscal year. (b) The principal changes in assets and liabilities, including trust funds, during the fiscal year. (c) The revenue or receipts of the corporation, both unrestricted and restricted to particular purposes, for the fiscal year. (d) The expenses or disbursements of the corporation, for both general and restricted purposes, during the fiscal year. (e) Any information required by Section 5322 of the California Nonprofit Public Benefit Corporation Law (pertaining to certain transactions and indemnifications involving interested persons). (f) A narrative description of the corporation’s principal activities during the fiscal year. (g) Such other information concerning the corporation as may be requested by the City Council in writing not less than ninety (90) days preceding the end of such fiscal year. Section 2. Records and Rights of Inspection . The corporation shall keep adequate and correct books and records of account and minutes of the proceedings of its Member, the Board and committees of the Board. Minutes shall be kept in written form. Other books and records shall be kept either in written form or in any form capable of being converted into written form. The books and records of the corporation shall be open to inspection and copying by members of the public to the same extent as the public records of the City of Santa Monica. Article VII. Indemnification Section 1. Statutory Indemnity . This corporation shall indemnify its Directors, officers and employees to the fullest extent permitted of the California Nonprofit Public Benefit Corporation Law. Section 2. Nonapplicability to Fiduciaries of Employee Benefit Plans. This Article VII does not apply to any proceeding against any trustee, investment manager, or other fiduciary of an employee benefit plan in such person's capacity as such, even though such person may also be an agent of the corporation as defined in Section 1 of this Article VII. The corporation shall have power to indemnify such trustee, investment manager, or other fiduciary to the extent permitted by subdivision (f) of Section 207 of the California General Corporation Law. Article VIII, Other Provisions Section 1. Endorsement of Documents; Contracts . Subject to the provisions of applicable law and these Bylaws, any note, mortgage, evidence of indebtedness, contract, conveyance, or other instrument in writing and any assignment or endorsement thereof executed or entered into between the corporation and any other person, when signed by (a) the Executive Director, or (b) (i) the Chair of the Board or any Vice-Chair and (b) (ii) the Secretary, any Assistant Secretary, the Chief Financial Officer, or any Assistant Treasurer of the corporation shall be valid and binding on the corporation in the absence of actual knowledge on the part of the other person that the signing officers had no authority to execute the same. Any such instruments may be signed by any other person or persons in such manner as from time to time shall be determined by the Board, and, unless so authorized by the Board, no officer, agent, or employee shall have any power or authority to bind the corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or amount. Section 2. Representation of Shares of Other Corporations . The Chair of the Board or any other officer or officers authorized by the Board or the Chair of the Board are each authorized to vote, represent, and exercise on behalf of the corporation all rights incident to any and all shares of any other corporation or corporations standing in the name of the corporation. The authority herein granted may be exercised either by any such officer in person or by any other persons authorized so to do by proxy or power of attorney duly executed by said officer. Section 3. Construction and Definitions . Unless the context otherwise requires, the general provisions, rules of construction, and definitions contained in the General Provisions of the California Nonprofit Corporation Law and in the California Nonprofit Public Benefit Corporation Law shall govern the construction of these Bylaws. Section 4. Establishment of Fiscal Year . The fiscal year of this corporation shall end on June 30 of each year. Section 5. Amendments . These Bylaws may be amended or repealed by the approval of the Board, effective only upon the Member's written approval given in accordance with Section 5 of Article II. THIS IS TO CERTIFY: That I am the Secretary of the Santa Monica Pier Restoration Corporation and that the above and foregoing Amended and Restated By-Laws were adopted as the By-Laws of said corporation on the _____day of __________ , 20_____ by the Board of Directors thereof and approved by the Member thereof. IN WITNESS WHEREOF, I have hereunto set my hand this ______day of __________________, 20_____. __________________________________________ Secretary 7/4/07 Attachment D SANTA MONICA PIER RESTORATION CORPORATION Annual Plan of Work for fiscal Year 2000-2001 Approved by PRC Board of Directors October 4, 2000 SANTA MONICA PIER RESTORATION CORPORATION Annual Plan of Work for Fiscal Year Ending June 2001 Table of Contents Page number PRC Mission Statement 2 PRC Roles and Responsibilities 2 Executive Summary 3 Marketing and Sponsorship 5 Pier Operations and Lease Management 10 Administration and Finance 14 PRC Board and Staff 16 PRC Mission Statement To preserve and enhance the pleasure pier experience for people of all ages and for future generations. PRC Roles and Responsibilities The Pier Restoration Corporation operates under its Services Agreement with the city of Santa Monica, dated December 2, 1985. The city and PRC entered into the agreement for the purpose of governing certain operational and management functions. The PRC and city recognized the need to update the agreement and for the past two years have been in negotiations for a new Services Agreement. In July 2000 the PRC board approved a draft agreement. It is anticipated that City Council will consider approval of the agreement in October. The new agreement reflects the current needs of the city and the Pier and more clearly defines roles and responsibilities of the PRC and city Under the new Services Agreement, the PRC will have responsibility for the operation of the Pier and for providing project management services to the extent specified in the annual work plan. It will have certain responsibilities with respect to ? general planning ? marketing ? corporate sponsorships ? licensing of marks ? leasing ? special events ? filming ? carousel operations ? parking and traffic circulation ? maintenance ? capital improvements The PRC is responsible for managing, advising, supervising directing and/or coordinating these functions to the extent authorizedby City Council under the Services Agreement and the Annual Plan of Work. The PRC also acts as an advocate to city staff and to the City Council on issues of concern related to the management and operation of the Pier. Executive Summary Overview The Santa Monica Pier Restoration Corporation (PRC), a non-profit public benefit corporation, was formed in 1983. The Pier had suffered enormous damage as a result of the storms in the winter of 1982-83 and the PRC was formed for the purpose of assisting the city in the rehabilitation, preservation, protection, development, operation and management of the Pier. A board of directors whose members are appointed by City Council governs the PRC. The Santa Monica Pier Development Plan, prepared by the PRC, was adopted by City Council in 1988. Since that time, the PRC, in cooperation with the city, has overseen the implementation of that plan. The city and various business owners have invested more than $45 million into the rebuilding of the Pier. Throughout this process an effort was made to balance the requirements attendant to the diverse uses on the Pier. The Pier is a unique public recreational and commercial mixed-use venue. It is a destination for more than 3 million local, domestic and international visitors each year. Until 1996, the PRC focus was on rebuilding and developing the Pier. While the PRC will continue to address development issues, its primary focus has shifted from development to improving operations and services, enhancing public amenities, marketing, sponsorship and special events. PRC Efforts Since 1983, the city, community and Pier business owners have invested cash and other resources that have resulted in a dramatic revitalization of this precious resource. Once again, it has become an asset of which Santa Monicans can be proud. The PRC is committed to doing what is necessary to ensure the long-term stability of the Pier so that it does not experience the decline of the 1960’s, 70’s and early 80’s. The PRC is committed to ensuring that the Pier is properly operated, maintained, and promoted so that it is a resource that can be enjoyed by future generations. It is also committed to promoting the provision of services and amenities that continue to appeal to a diverse demographic mix of visitors. It is anticipated that the new Services Agreement between the PRC and city will be finalized in the fall of 2000. This agreement will provide the organizational infrastructure that will enable the Pier to function more effectively. In addition, the programs described in the following pages will provide the means by which the PRC will deliver on the commitments mentioned above. The PRC faces several significant challenges in the coming year. The Pier has a variety of well-known operational problems that the PRC will address with the city, not the least of which is parking and traffic circulation. The Pier can be made more aesthetically pleasing and, therefore, more enjoyable for the public by improving maintenance and repairs of the facilities. It is important to do this to maintain the integrity and presentation of the physical structure. It is also important from a marketing perspective. Valuable resources are spent trying to attract and keep visitors and other clients. Efforts must continue to ensure that the experience of visiting the Pier is positive so that the value of PRC and tenant marketing efforts is maximized. There are also significant challenges in the area of lease management. There are a variety of unresolved leasing issues that need to be addressed to enable the PRC and city to move forward with new leases and important development plans. Marketing will remain a challenge because resources are limited and opportunities and projects will have to be carefully and strategically prioritized. Implementation of the Corporate Partnership Program, which began in January 1998, will continue to be a challenge as the dynamics of securing sponsors in this unique environment unfold. A number of event sponsorships have been secured and PRC staff will continue to seek the first top-line year-round sponsor for the Pier. The PRC will also continue its efforts to secure cash and in-kind sponsorship revenue that will be used to support its year-round special events programs and other marketing efforts. Marketing and Sponsorship Overview The Marketing Department is responsible for developing, implementing and managing the Marketing Plan for the Santa Monica Pier in the most productive and cost effective manner possible. Staff will oversee programs already in place and will develop new programs which best meet the goals and objectives of the PRC. A demographic study completed for the PRC in 1998 provided valuable information about Pier visitors, which has been used to develop marketing strategies and programs and potential sponsors. PRC plans to complete another survey in 2000/01. The PRC’s Marketing Committee holds monthly meetings to coordinate marketing strategies, programs and special events planning with the Santa Monica Pier Lessees’ Association (SMPLA), other contractors and city and private service providers. The Marketing Department includes four components: Special events, public and community relations, advertising, and the Corporate Partnership Program. Objectives The Marketing Department’s objective is to promote the Santa Monica Pier as a unique year-round seaside venue with multifaceted entertainment options and uses including family amusements, musical entertainment, dining, novelty retail, fishing, sightseeing, special events, filming and marine and environmental education. To achieve this objective, the following items are given careful consideration throughout all of the PRC’s marketing efforts: ? Recognition of the cultural, economic, and geographic diversity of the Pier’s visitors. ? Promoting the many uses of the Pier. ? Achieving the most cost-effective return for the resources spent. ? The need to reduce the “seasonality” of the Pier by expanding visitors’ awareness and use of the Pier as a year-round venue. Strategies The Pier is a unique and significant regional attraction that competes with other regional attractions. It is important for the PRC to improve its efforts to market the Pier. The Marketing Department is challenged by the need to use its limited resources as effectively as possible to achieve its goals and objectives. Its three key strategies reflect this reality: 1.Maximize marketing resources by partnering, whenever appropriate, with Pier businesses, special event producers, corporate partners and local organizations. 2.Promote the Pier primarily through consistent, well-organized public relations efforts and through limited advertising. 3.Promote special events in the “off-season” that appeal to current visitors and help build a wider visitor base with special attention to activities that are attractive to the local community. Target Markets The Marketing Department’s programs are designed to appeal to the following markets: ? Current Pier clientele ? Local Santa Monica and beach community residents ? Residents of the greater Los Angeles area ? Travel, trade and corporate ? Film companies ? Event producers The PRC advertises to hotel guests and other tourists through the Santa Monica Visitors Guide and the Quick Guide. Special events are promoted through advertising in local media and publicity efforts. PRC relies on Santa Monica Convention and Visitors Bureau efforts to promote Santa Monica as a destination to domestic and international tourists. The Pier is consistently included in the CVB’s promotion of the city. The Pier is listed in trade publications as a location for filming. Programs The Marketing Department will develop and manage the following programs to achieve its objectives. These programs are budgeted and managed through the PRC and rely on revenues from the city’s Pier Fund, the Promotion Fund (funded by a category of rent designated in most Pier leases), cash and “value-in-kind” sponsorship resources and income generated by events and special promotions. Special Events Following are the key annual events produced on the Pier and staged in public space. Twilight Dance Series th The 16 Annual Twilight Dance Series concerts will take place on Thursday evenings from June 29 through August 31. This event began in 1983 as a method of bringing the local community back to the Pier and sparking interest in plans to rebuild the Pier following its partial destruction in the winter of 1982-83. Attendance estimates in 1999 ranged from 9,000 to 15,000 per show. TDS is produced by the PRC. Pier Days th Pier Days 1999 held on October 2 and 3 marked the Pier’s 90 anniversary as a public venue. Pier events throughout 1999 were presented under the banner of the th 90 Anniversary. The celebration was kicked-off in April with the installation of th the city’s historic landmark plaque for the Pier. A 90 anniversary logo was developed and appeared from June through October on light pole banners on the Pier and along Ocean Avenue. In October 2000, Pier Days 2000 will be the second annual event and will feature many elements of the 1999 event including musical entertainment, activities for children, a story telling contest and a kite festival and special promotions by Pier merchants. Pier Days is the revival of an event that was first held on the Pier in the early 1920s. Pier Days is produced by PRC. Halloween on the Pier The PRC and Pier merchants attempted to create an annual Halloween event called Pier Thrills and Chills. It was moderately successful. Because Halloween falls on a Tuesday in 2000, the event will likely be limited to trick-or-treating. Winter Holidays This is an annual promotion, coordinated by PRC, from Thanksgiving through New Year’s Day. It includes the installation of holiday banners as part of a citywide program, a visit by Santa Claus, a Menorah lighting and special entertainment. “Rose Bowl Week” has emerged as a busy time on the Pier, and PRC will invite Rose Bowl bands to perform on the Pier from December 26 – January 1. Sunday Concerts on the Pier This annual pop music event produced by the SMPLA with support from PRC, is a free concert series that runs on Sunday afternoons from February through May. Three to four hundred people attend the concerts each week. Cinco de Mayo Celebration The event, produced by PRC, will include musical entertainment and special events and promotions at many Pier businesses. It is a daytime event that is designed to appeal to families as an added form of entertainment for Pier visitors. Public Relations Public relations efforts for 2000/01 will include the following: ? Revision and distribution of Pier media kits. ? Writing and distribution of media releases for special events and news. ? Pitching stories about the Pier to appropriate local, regional and national media. ? Pitching local organizations to encourage participation in Pier events and promotions. Advertising Internet The PRC created the Pier’s website, www.santamonicapier.org in 1998 as part of a corporate partnership agreement. The web site will be redesigned to make the site more appealing and will more effectively serve the Pier’s needs. An advertising campaign will promote the new web site. Print The PRC will produce and pay for an ad in the Santa Monica Visitors Guide in partnership with Pacific Park. This ad will also appear in the L.A. Quick Guide, a publication that is placed in hotel rooms throughout the region. Event specific ads will be placed. PRC will also seek out cooperative advertising opportunities for the Pier. Television and Radio Event specific ads and PSA’s will be created and placed. On Site PRC will create two sets of identical light pole banners for the Pier to be on display from September until December and from January until July. While set number 1 is on display, set number 2 will be cleaned and stored until it is time to clean set number 1. Graphic Identity Program PRC will develop a new graphic identity program to include creation and production of logo and collateral materials including business stationery, rack cards and flyers for events. The identity program will also be applied to print ads, the new web site and the sign program described under Sign Program on page 12 below. Corporate Partnership Program An important component of the Marketing Department is the PRC’s Corporate Partnership Program. This program was implemented following an assessment of the Pier’s marketing assets by IEG, the recognized leader in the field of sponsorship. The IEG study indicated that the Pier’s assets could be packaged to create valuable sponsorship opportunities in a program that would reflect the values of the community, meet the PRC’s marketing goals and provide benefits to Pier visitors, businesses and sponsors. The goal of the Corporate Partnership Program is to develop long and short-term revenue streams for the Pier in order to expand its ability to promote itself as a viable tourist and local attraction. The PRC will secure cash and value-in-kind resources for the Pier by selling corporate partnership packages to companies in specific product and service categories that are appropriate, as specified in the IEG study, for the Santa Monica Pier. The program has been in place since January 1998. A number of event sponsorships have been secured and staff endeavors to remain on target and secure two top-line year- round partnerships in the next fiscal year. The short-term plan to achieve the goal of the Corporate Partnership Program is to replicate the success of the Twilight Dance Series with other events including Pier Days. Other possible events include a classic film series, a craft fair or a kite festival. The long- term plan is to attract annual sponsors interested in selling and branding opportunities. While the Pier attracts more than 3 million visitors each year, as a marketing vehicle for sponsors it offers limited opportunities. Staff will create more “sponsor friendly” opportunities to maximize the Pier’s revenue potential. Goals for the Marketing Department ? To successfully produce and support the special events described above. ? To obtain media coverage of special events and news and improve the Pier’s public image through the media. ? To secure 2 year-round corporate partners, 2 event presenting sponsors and 6 event co-sponsors. To renew current event sponsorship agreements. ? To design and launch a new web site for the Pier, to create links with Pier sponsors and other related web sites to drive visits to the Pier web site. ? To create and implement a new graphic identity program for the Pier. Pier Operations and Lease Management Overview The management structure for Pier maintenance, parking lot operations and leasing is described in the yet to be finalized new Services Agreement. Discussions between PRC and city representatives during the past 24 months about the new Services Agreement resulted in clear definition of responsibility for these areas. All day-to-day responsibility for maintenance is with the city’s Pier Maintenance Supervisor. The city’s Pier Leasing Manager is responsible for leasing, Carousel operations and vendor carts. Parking operations are under the direction of the city’s Planning Department. Under the new Services Agreement the PRC’s role will be to develop leasing policies, review and approve new leases and improvements. In addition, it will play a significant role in setting priorities for maintenance and improvement of visitor amenities. PRC will continue to work with the city to ensure that maintenance, parking lot operations, development and leasing are professionally managed. PRC staff will work with city staff to ensure that the Pier is maintained and operated efficiently, that it is safe and that standards are increased to effectively serve Pier visitors and business owners. Objectives ? To advise the city on leasing matters. ? To significantly improve coordination between city of Santa Monica departments and PRC to expedite resolution of leasing, maintenance, operations and development issues. ? To provide recommendations to the city for improvements in maintenance and operations and for other significant projects on the Pier. ? To work with city staff to improve the general cleanliness and appearance of the Pier to better serve visitors and business owners. ? To improve coordination and communication with the SMPD and Harbor Patrol to ensure that special event, filming and other operational issues are addressed, that business owner and PRC concerns are understood and that public safety improvements are implemented. Strategies The PRC does not have direct management responsibility for operations and leasing and capital improvements so PRC staff must rely on maintaining good rapport with city staff to identify and prioritize projects. Staff will coordinate PRC participation in various projects including the city’s Pier bridge widening project, the building of a ramp from the Pier to the 1550 PCH parking lot, the implementation of other measures to improve circulation and parking, and planning efforts for the breakwater project and the development site. PRC will advocate for improved maintenance and upkeep and improved visitor amenities on the Pier. It will also continue to advocate for public safety improvements. In the area of leasing management, PRC staff will cooperate with city staff to bring leasing matters to the PRC board of directors. The board will adopt Pier leasing guidelines that will provide a framework for developing lease terms, conditions and operating requirements. Projects PRC will address the following projects. Pier Bridge Widening and Construction of Ramp from Pier to 1550 PCH Parking Lot Throughout the city’s various studies of parking and traffic circulation problems, the PRC has played an active role in providing information for the studies and in providing constructive responses to recommendations emerging from the studies. PRC continues to maintain that the highest priority for improving operations not only for the Pier but also for the adjacent residences and businesses, and the quality of Pier visitor experience is to complete the Pier bridge widening and the ramp to 1550 PCH. PRC will continue to cooperate in the city’s efforts to address traffic and parking and will advocate for the completion of these two projects. Development Site Conceptual Plan The Fransen Company, a consulting group engaged by the PRC for the purpose of evaluating Pier operations and development opportunities, identified this site in its 1998 Retail Assessment and Recommendations. It is an area of approximately 25,000 square feet between the entrance to the Pier parking lot and the Playland Arcade. In early 1999, the PRC Board of Directors approved, subject to securing funding from the city, the creation of a concept design for the site to accommodate specific elements including a new public restroom facility, an expanded SMPD substation and a variety of retail businesses. Lease for 301 Santa Monica Pier PRC will fulfill its role in the process of developing a new lease for this site. Parking Operations Parking operations for the lots serving the Pier (the Pier deck lot, 1550 and 1440 PCH and Hot Dog-on-a-Stick) should be integrated to ensure that visitors to the Pier area and event and filming clients can come and go as easily as possible. Customer service and safety should be the highest priorities for the parking operator. PRC will also advocate for a promotional program to make the public aware of the various parking options on and around the Pier. Sign Program PRC will advocate for the development and implementation of a comprehensive sign program for the Pier. The program will incorporate the new graphic identity program and will include the installation of 5 directories and replacement of all directional signage on the Pier. A new sign program will significantly enhance the experience of visiting the Pier. Carousel Operations Evaluation Carousel operations will be evaluated and management alternatives will be explored with the intention of better serving the public by extending the hours of operations, improving the appearance of the facility, and operating more efficiently. Cart Program The PRC will fulfill its role in the development and implementation of a new vendor cart program that will provide improved service to Pier visitors. UCLA Ocean Discovery Center Phase 2 The PRC formed an ad hoc subcommittee in spring of 2000 which will continue to work with UCLA on plans for phase 2 of the Ocean Discovery Center. Goals ? To participate in the Pier bridge widening and ramp to 1550 PCH projects and the implementation of other parking and circulation measures. ? To complete conceptual plans for the development site. ? To conclude a new lease for 301 Santa Monica Pier. ? To identify priorities and establish short-term priorities for maintenance and for at least a 3-year plan for repairs and capital improvement projects. ? To implement a comprehensive directional sign program on the Pier. ? To significantly improve Carousel operations. ? To implement a new vendor cart program. ? To adopt new Pier leasing guidelines. ? To develop recommendations for public safety improvements. Administration and Finance Overview The Administration and Finance Department is responsible for a wide variety of administrative duties. Its duties include all financial functions, processing applications for and facilitating filming and special events, administration of PRC insurance policies, Board and committee support, liaison with parking operators and Pier maintenance. PRC staff also handled the collection and processing of rent, supervision of the Carousel operations contract and Pier licensees until January 2000 when the city hired a Pier leasing manager who now is responsible for those functions. Objectives ? To provide financial and administrative services as efficiently as possible and in a timely and accurate fashion. ? To generate filming and special event activity and to provide good service to clients wishing to use the Pier for filming and for event production. ? To provide effective administrative support for the Board and committees. Strategies The department will continue to maintain excellent communication internally and with various city departments to ensure that it can effectively perform its wide range of administrative duties. It must also ensure that it responds quickly, efficiently and in a helpful and friendly manner to filming and special event clients. Preparation and follow- up for meetings will be completed as efficiently as possible. Projects Revise Event Management Guidelines and Plan In anticipation of the city’s implementation of new special event policies, the PRC will revise its event application process and create event packages. This will enable the Administration and Finance Department to more efficiently manage the event application and production process. Review of Filming Guidelines and Permit Process Staff will review and revise as necessary Pier filming guidelines and the film permit process to ensure that this program is managed effectively and profitably. Filming activity will be used to promote the Pier as one of the world’s premier public spaces, a place where people from all ethnicities and walks of life converge to recreate. Intellectual Property Management The PRC will license the use of the city’s Pier service marks, copyrights, logos photographs and graphic depictions and other material according to a program to be approved by the city. Goals ? To maximize access to the Pier as a location resource for commercial filming, feature films, music and television productions and to do this profitably and efficiently with minimum detrimental impact on Pier visitors and businesses. ? To prepare updated information for filming and special events applications and to post this information on the Pier website. ? To prepare and deliver monthly and quarterly reports as appropriate for filming, special event and special promotions revenue. ? To maintain a current integrated calendar of PRC and Pier activities. Pier Restoration Corporation Board of Directors Rae Archibald Abby Arnold Glen Friedman Don Girard Jonathan Gross Michael Klein Jean McNeil Wyner William Spurgin Linda Sullivan Natividad Vazquez Staff Executive Director Jan Palchikoff Marketing Manager Steve Kohn Office Manager Aurora Astorga Administrative Assistant Ben Franz-Knight