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• "v1HE FOLLO'!I.'.G copy O TILE", THE GRIGINAL OF H WAS FILED j
FOR P,ECOI� ON9 `�'1 —iC "-T� 1N THE OFFICE OF THE RECORDER
OF _ ICOUFNiTY, CALIFORNIA, IS SENT TO
YOU. INAS?1tJCH AS EXAM.IHATIOt OF THE TITLE T7 SAID TRUST PROPERTY
SHOWS YOU MAY -.HA AN INTEREST IN THE TRUSTEE'S SALES PROCEEDINGS.
TITLE . I1`iSURANCE" AND TRUST COMPANY, AS ,TRUSTEE
Notice of Default and Election to Sell Under Deed of Trust
SUBSTITUTED
NOTICE IS HEREBY GIVEN: THAT TITLE INSURANCE and TRUST COMPANY, a corporation is duly )(pyW#K%%KTruetee under o Deed of
.Trust dated FEBRUARY. 25, _ 1972
executed by BALBOA SAY CLUB, INC., A CALIFORNIA,CORPOR'ATION
.. as Triedar, to secure certain abRAwtfane:
In favor of USE INVESTORS,A GEORGIA BUSINESS TRUST
., as baneficieft.
recorded 3-16-72 Monino. 13703 took 10040 page 629 inof theeOOffi Of ON
Rectods
Recorder of ORANGE County, Comm. ia,X"00X"X$W
iNLdG?i)Edk
said obligations:
Including ONE note far the PRINCIPAL sumof$ 6,6500000.00
that the beneficial interest under such Deed of Trust and the obligations secured thereby are presently held by the undersigned, tMst
a breach of, and default in, the obligations for which such Deed of Trust is security has occurred in that payment has not been
moaeof: THE REMAINING PRINCIPAL SUM WHICH BECAME DUE OCTOBER 310 1973,
TOGETHER WITH INTEREST DUE FROM DECEMBER. 1, 1974.
that by reason thereof, the undersigned, present beneficiary under such Deed of Trust, fiu executed- and delivered to said duty 4p-
pointed Trustee, a written Declaration of Default and Demand for Sale, and has deposited with said duly appointed Trustee, such 6bed
of .Trust and all documents evidencing obligations secured thereby, and has declared and does hereby declare all sums secured Mere -
by immediately due and payable and has elected and does hereby elect to cause the trust property to be sold to satisfy the ablipa-
tfons secured thereby..
Iidt)EPENDENCE MORTGAGE TRUST, A GEORGIA
BUSINESS TRUST, FORMERLY USE INVESTORS,
THIS NOTICE MUST BE RECORDED A GEORGIA BUSINESS TRUST
BY TITLE INSURANCE BY PROVIDENT REALTY, INC.
AND TRUST COMPANY ONLY; ATTORNTY-IN-FACT
Decd AUGUST 5 1975
Thomas L. LaHay, Senior Vice President
NOTICE
YOU MAY HAVE THE RI(=FIT TO CURE THE DEFAULT DESCRIBED HEREIN AND REIN—
STATE THE MORTGAGE OR DEED OF TRi)S T . SFCTION 2924C OF THE CIVIL CODE. '
PERMITS CERTAIN DEFAULTS TO BE CURED UPOi) THE PAYMF€*iT OF THE AMOUNTS
REQUIRED BY THAT SECTION t1ITHOUT REC!1IRING PAYMENT OF THAT PORTION OF
PRINCIPAL AND INTEREST VHICH WOULD t!OT BE DUE HAV NO DEFAULT OCCURRED.
,VtHERF. REIVSTATEtIENT IS POSSIBLE, IF THE DEFAULT IS NOT CURED WITH11y
THREE MONTHS FOLLOWING THE RECORDING OF THIS NOTICE, THE RIGHT OF
RS7NSTATEMENT WILL TERMINATE AND THE PROPERTY MAY, .BE SOLD.
TO DETERMINE IF REINSTATEMENT IS POSSIBLE AND THE AMOUNT, iF ANY,
NECESSARY TO CURE THE DEFAULT, CON -ACT THE GENFFICIARY t%R MORTGAGEE GR
THEIR SUCCESSORS IN INTEREST, WHOSE NAME AND ADDRESS A - t�F THE DATE G�
THIS NOTICE IS Ih7E:PENPFNCF 14ORTG';GE TPl1C]", A
FORMERLY USF INVEE,TORS, A GFORGIA 3USINES4 TRUST C/O U,JNOFS
F h1ALI:ER,S55 SOUTH FLOWER STRE.r 1, LOS ANaFLES, CALIFORl±?A '•^if 1. ,TTN.
r .
0
Policy No, NXP2336002
r
Name
Insured International Bay Club
This is to certify that the
City of Newport Beach
CERTIFICATE OF INSURANCE FOR LEASE OF CITY PROPERTY
COMPANY
of Company or Organization)
r�7
of P 0. Box 1975 Santa Ana. calif. - I
(Address of Company or Organization)
has issued to
International Bap Club, Inc. etal
1617 Westcliff Or.. Suite
of
wport Beach, Calif.
of Insured)
The policy of Liability Insurance described herein, which by the attachment of the City Property Endorsement has been changed in
accordance with the terms of the Endorsement. Coverages and limits of liability under the policy are not less than:
BODILY INJURY PROPERTY DAMAGE
$100,000 each person $50,000 each person
$300,000 each occurrence $50,000 each occurrence
CITY PROPERTY ENDORSEMENT
This endorsement is attached to the policy described herein to assure compliance by the named insured with the terms and provisions
of the lease, rental or other agreement entered into between the insured as Lessee and the City of Newport Beach as Lessor.
The Company or Organization amends the policy described herein as follows:
1. if the policy is cancelled or changed so as to affect the coverages, at least fifteen (15) days prior written notice of such
cancellation or change will be sent to the Lessor, City of Newport Beach, c/o City Manager, 3300 Newport Boulevard,
Newport Beach, California 92660.
2. The Lessor City of Newport Beach, its officers, and employees are hereby declared to be additional insureds in the policy
described insofar as they may be held liable for injuries, deaths, or damage to property occuring in or about the leased
premises including negligence of the city and the company waives any right of contribution which it may have against any
other insurance carrier by the additional insureds.
Lessee shall, at his own expense, take out and keep in force during the within tenancy, public liability insurance, in a company or
companies to be approved by the Lessor, to protect the City of Newport Beach, its officers and employees against any liability,
including negligence of the City, to any person incident to the use of, or resulting from injury to, or death of, any person occuring in,
or about the demised premises, in the amount of not less than $100,000.00 to insure against the claim of one person; in the amount of
not less than $300,000.00 against the claims of two or more persons resulting from any one accident; and $50,000.00 for damage to
property,
Said policies shall obligate the insurance carriers to notify the Newport Beach City Manager in writing, not less than fifteen (15) days
prior to the cancellation thereof, or any other changes affecting the coverage of the policies.
Lessee shall furnish as proof of public liability insurance, a fully executed copy of City form, "Certificate of Insurance for Lease of
City Property" and "City Property Endorsement." Lessee agrees that, if Lessee does not keep such insurance in full force and effect,
Lessor may take out insurance and pay the premiums thereon, and the repayment thereof shalt be deemed to be additional rental.
This endorsement countersigned by an authorized representative of the Company or Organization becomes applicable endorsement
number
Effective Date of Policy: 3/9/73 Expiration Date of Policy: 3/9/76
Dated: May 14 19 73 at Newport Beach, Calif.
(City) (State)
Name of Agent or Broker: Anderson & Anderson, Inc.
Address of Agent or Broker: P. 0. Box 127, Balboa Island, Calif. 92662
Countersigned By:
thorized
0
IMPORTANT — THIS FORM IS THE ONLY CERTIFICATE OF INSURANCE ACCEPTABLE TO THE CITY OF NEWPORT BEACH
OFFICE OF THE MANAGER
August 1972
,,_::; 'ir NG MOUESTEiD RY
AN,, :-iEN/ RECt)E DEI) PAIL T� 137 4
O,KvEt'1, REMIT & GRIEFP, INCORPORATED
2323 North `f]oadt•ray, Suite 1100
Santa Ana, California 97.700 _
it
Telephone: (7111) 835-1100
ii Ccs
TO 698 C
(Corporation)
diff. 10040 j"r+ff P,^7
+✓us.
'.T i'__- t;a
�3.1 ... .SIL✓ � .... vr.. ....r 41�w
),�':7LLC.".:::' ,Ces7lyP,asor�tr
REQUEST FOR NOTICE OF DEFAULT
Immediately prior to the recording hereof there has
been recorded a Deed of Trust and Assignment of Rents dated
February 25, 1972 between the undersigned, BALBOA BAY CLUB, INC.,
a California corporation, as Trustor, USF INVESTMENT MANAGERS,
INC., a Delaware corporation, Trustee, and USF INVESTORS, a
Georgia Business Trust, Beneficiary, affecting a leasehold in-
terest in that certain real property in the County of Orange,
State of California, described in Exhibit "A" attached hereto.
In accordance with Section 2924b, Civil Code, request
is hereby made by the undersigned Trustor, that a copy of any
Notice of Default and a copy of any Notice of Sale under said
Deed of Trust affecting the above-described property be mailed
to the City of Newport Beach, 3300 Newport Boulevard, Newport
Beach, California.
BALBOA BAY CLUB, INC.
By 'r,
Thomas .Ll O'Kee;e,"Secretary
STATE OF CALIFORNIA
COUNTY OF_OtRAUGE ) SS
On arCh 1�2 before me, the undersigned, a Notary Public in and for said
State, personalty appeared THOMAS J. Or KE '�' �y_
known to me to be the MX11 io'bS )bXjX
1kr}ws'uYil rX YcuY ]4t%liC Secretary of the corporation that executed the within Instrument,
known to me to be the persons who executed the within
Instrument on behalf of the corporation therein named, and
acknowledged "r me that such corporation executed the within eoa 8opoo8666068 po oOPo 8y Ao0oio0
instrument pursuant to its by-laws or a resolution of its board 4
of directors. o@7�:"
JO ANN JOHNSaidWITNESS my hand and official sea] o NOTArY ?UCLIC•CALIFORNJA F;IINCNIAL OFFICE IN
"> OIiANGc COUNTY o
4 ��•—� A Ori;ci SFAI /.Ir Commiuton Pk41ro1
Signature �. 4J "�'L--x- c 7cN.:y... 0
:•T9PiVOJ808}88C001408ApFy'26 1975 0
8880i -8C
Jt Ann Johnson
' Name, (Tyl e l or Printed)
Rats area lar official aM.ext /<a1}
a` ioii,ni.,.u�}
r,,
ttj" �'i•Sl.:t.C)7' .i.Il .liCl t•t} (.itltl; Curt:ain in wecl of
1 L::4` l..i i; �r Ui' }'a+iA;7�;y GC)lutL�' of UI"11l e., .)L"At4'
t',
Oi� (,ft]„1 i'�ii'?)�. :y Uil7: .. 1�:1.1'1•'1 t:1: J. ;...'i,,:�`.'I'1'].l)4�.1 it :. I�U.I .LVt•: :i.
JJe ;iz:. is at':1 point on til:: U, S. Eu'.: 1_ d Un- o=cndin; from U. S. Saul' :lead
Stn.. io.a ti,). 12:0 to 11. S. J:::l: ic.,d ::.: i.. :l No. 1=02 as said Bulkh_ad lino and
It IlRI:ead St ti_en:z are laid out and sho%-a on a uip of litw-p ort Illy, California,
she>)iIi ; tiarbc;r 1: nc;: acYroved by t! I ”,t .' r Dcnartr_L'nt, JanilaI:Y 18, 1017, iahich
said poi•... 'a t: ekiL twtt sot lt:h 61° 011 071j 1:tsst0 r; <-...: aCI aloe; said Eul'::-leaa
liilc, 700,00 .._.c,`- frc-. Lh1 .' TeZc):section of sa:i-d illii;tivad lira frith the
5011111:?^: S:Cx1y 2)roIo-."7,1,6.iOn of the center ling of Irvirm Avenue, as ,S: mm on
::) r
1 111 O:. A•i .. .a4(i'1ti.v.i to N: ,v'J chit 2 _'1.�; CS, I'CCord Cti J'.n bMolc jiy page 94 O,
1'ti�ccll C.^.•�0::1 i':.^ ,:y ....,, tlt:; :Y;.;ficu of 2:1:^ Cotler: -, rc-ordLi: of :::.l''d Orznai e. ro:L'1.t
Said 120illi: of .:Git So ::'IC t1} coxller of Lot 1e./
or
Tract: No. (1119, ar £::\:::1 0`.: .. ra—,-, rccore-c'..i in 29, paaU s 31 to 34 malls va
inclusiveyt: id :c ofzics of ile r:
w nn r+-.^ t oa' 01 "" rr t:0 a point iu the
Or. nJ.. CG A...y, C C•.'• l OrtR lu 'Ju 5.2 I9it 154.19 fcc^.t
Sot2I:l:FCStCx�.y 1 Of 111^ 100 iout rin..t irr. Cty o� t 7ilifoState Itiohwy
0:;:. 130 -may 51'1('1 1)6:1 t 1) 11: :l1 G ':2 1 :li:'.0:? 6'i'jSe13 1T tPC C Yt^r
lin3 of said hiSh way, said rtecli"a:, i)L'ars`:iartil 199 37' 57" Bast from said, point,
S c1'ifl sou:'tl'.::..'.tei:.3.y lJ-_C ll.cin-o a cu-,vCy conc.vu Nor "lie -as tw.-.y and bavriT],r.,'`� a
r4lda.us2\1 ,1 l[ �Vei7vT CJuia4 C h
L .00 fL_ tll_�ce rou ^.102. .)outir, t cx1J i:ice
anSla of 3, 591 27", .l.ti2.79a rr.'e.•'i: t0 a tan,:int line i.:1 ::1:Ce
South M' 27.' 3011 ::ast ...lu 2, sic'• tzrv� lin_ an"! ----Id otttt::._ ^:cxly lit::, 652.03
teat; if=lance South 28' 53' 53" West 19:5.71 za::ty LL=,rc�: Souter 27° 00' Coil
E-_:st 16.66 T<w..a.:t; eha:* `.'. Sunt` 3* s', r31, .,ry 4; ;0 C0 •+•eett e p '"aallsl
la -:t; .} SJ .iJ T1'c..a . 1 1 4 to a lin a:.:.
with asd Squtta.rristerly 350.00 zfect from said 1l'uU-ha:d l:)..IIr::; L`harca north 619 01'
07" i7c:,L' aloe„ .,aid parz7lJ 3.in a ciistarc4 0_` 70i.00 feet to a point siaa.ch
T• nU rn1 t! :>., a. •- .3. 0.00
,Octthe f; Mw.
bears Sl outh 2u .)t 5.i es _v from- tal i70i� £ S 1) - 1^«;i dy ii.2 iC0
owth 239 5S' 53>" a? st:. 350..00 fee to the point o?- b=_oinnlnS.
i -C PT that portio21 e scribcd as fol!o:,s: I;'c-ronin- ata point on the Southerly
lana of the in ;.o: t r4g-at of way 0E, the Ca1'iforrJu., S'.. to Jti h:,ay 0 LN --60-E in
Co::nty, said -point- of ba ilaii. b'ainJ at rig^ -)t <angi.c5 to p.'. 3incc
Station //7��`/�95,A6 ill the cC'.ater 1.1ile of said h:'i^1:.;11,,7(;�(�t 111 lice .Sr:'1. l.th 115' 33' .10"
Wast: 1;4A 00 Arc. ; tbence 1Tzc _rtl't 74' 21' 3D" Tti we J I.VJ ( Ly tll:' ncc: bolt:1 159 3V-
30"
-30" East to an :i:ltc-rsection faith th:. ,aid Sa.I herly ling of tha Stetc }?igl:way;
thencS°. alr)i:l- &aid South S`.r.l.y line to the point- of ba'rg:1.91'7 i-
ALSO %::.C^Pi that portion thereof lying Sout 1westerly of the existing
concrete j ulkaead or below the i,ean thigh tide line of the Pecific ,
Ocean in Newport Bay as to those portions where nroved Bulk='
head exists. i" r Tj j;l-,
t
11,)' j'�
UNIMPROVED PROPERTY LEASE
BETWEEN
CITY OF NEWPORT BEACH
AND
BALBOA BAY CLUB
(As Amended to Date)
September 7, 1965
A%
TABLE OF CONTENTS
W r 4c -
Page Page
Introduction.................................................... 1
LegalDescription ............................................... 3
Termof Lease ................................................... 5
Purposeof Lease ......................... I ....... I.............. 5
Useof Premises ................................................. 5
Minimum and Percentage Rental ................................... 6
Definition of Gross Operating Revenues .......................... 8
Booksof Account ................................................ 10
Utilities, Taxes and Assessments ................................ 10
Compliancewith Laws ............................................ 11
Improvements, Fixtures and Equipment ............................ 12
Assignment of Lease ............................................. 13
Subletting...................................................... 14
Default......................................................... 14
Remedies of City ................................................ 15
Costsof Litigation ............................................. 16
PeacefulEnjoyment .............................................. 17
Invalidity of Provisions ........................................ 17
Relationship of Parties ......................................... 19
Holding Over .................................................... 19
Notices........................................................ 19
Collection of Rental Deficiencies ............................... 20
Successors and Assigns .......................................... 20
Seal of Adoption ................................................ 21
7 September 1965
UNIMPROVED PROPERTY LEASE
(Amended Working Copy)
THIS INDENTURE OF LEASE made in triplicate this
24th day of March, 1948, by and between the CITY OF
NEWPORT BEACH, a municipal corporation, party of the first
part and hereinafter for the sake of convenience designated
as the "City", and BALBOA BAY CLUB, a California corporation,
party of the second part and hereinafter for the sake of,
convenience designated as the "Club",
WW I T N E S S E T H;
THAT WHEREAS, the City is the owner of certain
harbor frontage, tidelands and uplands abutting thereon,
located within the corporate limits of the City of Newport
Beach, in the County of Orange, State of California, and
hereinafter more particularly described; and
WHEREAS, in the judgment of the City Council of
the City it is for the best interests and welfare of the
City and the residents thereof to lease the aforementioned
real property hereinafter more particularly described to
the Club for the purposes hereinafter set forth and under
the terms and provisions herein contained; and
WHEREAS, in the judgment of the City Council of
the City the use of the aforementioned harbor frontage,
tidelands and uplands abutting thereon, hereinafter more
particularly described, for industrial uses or purposes
would be inimical to the best interests of the City; and
WHEREAS, in the judgment of the City Council of
the City the use of the aforementioned harbor frontage,
tidelands and uplands abutting thereon, hereinafter more
particularly described, for other than industrial uses or
purposes would be for the best interests of the City and
the residents thereof; and
WHEREAS, it is the judgment of the City Council
of the City that the leasing of the aforementioned real
property hereinafter more particularly described to the
Club upon the conditions in this agreement specified is
not inconsistent with the trusts imposed upon such tide-
lands contained therein or inconsistent with or opposed to
the law in such cases made and provided; and
WHEREAS, a portion of the aforementioned real
property hereinafter more particularly described constitutes
tideland and water frontage and a portion thereof constitutes
uplands abutting thereon, and in the judgment of the City
Council of the City said uplands cannot be used without said
tidelands nor can said tidelands be used without the uplands
abutting thereon and the leasing of the whole of the afore-
mentioned real property hereinafter more particularly.
described as one parcel is necessary for the proper develop-
ment and use of said real property and for the proper
-2-
developmerrt of Newport Harbor and the City of Newport Beach,
NOVI THEREFORE THIS AGREEMENT FURTHER WITNESSETH:
That the City, for and in consideration of the
rentals herein reserved and the covenants and agreements
herein contained on the part of the Club to be kept and
performed, has demised and leased and does by these presents
demise and lease unto the Club that certain real property
lying and situate in the corporate limits of the City of
Newport Beach, County of Orange, State of California, and
more particularly described as follows, to -wit;
Beginning at a point in the U. S. Bulkhead line
extending from U. S. Bulkhead Station No. 129 to
U. S. Bulkhead station No. 130, as said Bulkhead line
and Bulkhead Stations are laid out and shown on a Map
of Newport Bay, California, showing Harbor lines
approved by the War Department January 18, 1917, which
said point is distant South 610 00' 00" East, measured
along said Bulkhead line, 700.00 feet from the inter-
section of said Bulkhead line with. the Southwesterly
prolongation of the center line of Irvine Avenue, as
shown on a Map of First Addition to Newport Heights,
recorded in Book 4, page 94, Miscellaneous Maps,
records of Orange County, California, said point of
intersection being the most Southerly corner of Lot
"H" of Tract No. 919, as shown on a Map thereof
recorded in Book 29, Pages 31 to 34 inclusive,
Miscellaneous Maps, Records of Said County, and run-
ning thence from said point of beginning, North 290
00' 00" last, 155.00 feet, more or less, to the
Southerly line of the eighty (80) foot right-of-way
of the California State Highway, as shown on Sheet
No. 2, Section B, Route 60, County of Orange, Division
VII, of Plans approved by the California Highway
Commission on November 19, 1923 and on file in the
office of said California Highway Commission;
Thence, Easterly along said Southerly line of
the eighty(30) foot right-of-way of the California
State Highway, to an intersection with the North-
easterly prolongation of the Northwesterly line of
-3-
Tract No. 1140, as shown on a Map thereof recorded
in Book 36, Page 28, Miscellaneous Maps, Records of
said Orange County, which point of intersection
bears South 10 36' 30" West, 40 feet from Engineers
Station 23+12.35 of the center line of said highway,
said points of intersection being station No. 131
as described in Decree in Case No. 20436 of the
Superior Court of the State of California in and
for the County of Orange;
Thence, South 290 00' 00" West, along the last
mentioned Northeasterly prolongation, the said
Northwesterly line and the Southwesterly prolonga-
tion thereof, 632.07 feet to a point in the said
U. S: Bulkhead line between Station No. 129 and
Station No. 130, said point being Station No. 130
as described in said Decree in Case No. 20436;
Thence, continuing South 290 00' 00" West,
350.00 feet to a line parallel with and distant
350.00 feet Southwesterly, measured at right angles
from the above mentioned U. S. Bulkhead line between
Station No. 129 and Station No. 130;
Thence, North 610 00' 00" West, along said
parallel line, 1574.84 feet, more or less, to a
point which bears South 290 00' 00" West, 350.00
feet from the point of beginning of the description
for this parcel;
Thence, North 290 00' 00" East, 350.00 feet to
the said point of beginning.
EXCEPTING THEREFROM, that certain parcel of
land lying in the City of Newport Beach, County of
Orange, State of California, described as follows:
Beginning at a point in the Southerly line of
the 100 foot right of way of the California State
Highway ORA -60B in Orange County, California, said
point of beginning being at right angles to
Engineers Station 7+95.46 in the center line of
said highway; thence South 150 38' 30" West 44
feet; thence North 740 21' 30" West 34 feet; thence
North 150 38' 30" East to an intersection with the
said Southerly line of the State Highway; thence
Southeasterly along said Southerly line to the
point of beginning.
SUBJECT TO easements and rights of way of
record.
-4-
THIS LEASE is made upon the following rentals,
terms, conditions and covenants between the parties hereto
and as follows, to -wit;
TERM OF LEASE
The term of this lease shall be for a period of
fifty {50} years, commencing on the lst day of September,
1948, and continuing to and including the 315t day of
August, 1998, provided all of the terms and conditions
hereof shall be fully completed, observed and performed by
the Club and the rentals herein provided shall be fully
paid at the time and in the manner hereinafter specified.
PURPOSE OF LEASE
The real property hereinbefore described may be
used by the Club for any purpose not prohibited by law,
other than industrial purposes, and the Club agrees that
it will not use the demised premises for any purpose not
authorized by law or for any industrial purpose without the
written consent of the City first had and obtained.
USE OF PREMISES
PRIOR TO TERM
Notwithstanding any of the terms and provisions
in this lease contained, the City agrees that the Club shall
be entitled to use and occupy the demised premises during
the period between the date hereof and the 1st day of Sep-
tember, 1948, for any purpose not prohibited by law, other
-5-
than industrial purposes, without the payment of any rental
therefor. Such use of the premises prior to the commence-
ment of the term hereof may include the erection and con-
struction of buildings, structures or other improvements
and such other activities as to the Club may appear desir-
able or necessary.
MINIMUM RENTAL
The Club shall pay to the City as a minimum
rental for the use and occupancy of the demised premises
the sum of Forty-five Thousand Dollars ($45,000) a year,
payable on a calendar year basis, prorated for the last
three quarters of calendar year 1960, and $45,000. per
year thereafter during the term. The said minimum rental
shall be paid in equal quarterly installments in advance,
with the first installment falling due on April 1, 1960.
For the period from January 1, 1998 to August 31, 1998,
said payment and accrual of rental shall be prorated.
PERCENTAGE
RENTAL
The Club shall pay to the City in addition to
the minimum rental in the foregoing paragraph mentioned for
the use and occupancy of the demised premises a sum equiva-
lent to five per cent (5%) of the gross operating revenues
of the Club not in excess of Seven Hundred Fifty Thousand
Dollars ($750,000), plus a sum equivalent to four per cent
-6-
(d%) of the gross operating revenues of the Club in excess
of Seven Hundred Fifty Thousand Dollars ($750,000) and not
in excess of One Million Dollars ($1,000,000), plus a sum
equivalent to three per cent (3%) of the gross operating
revenues of the Club in excess of One Million Dollars
($1,000,000) received by the Club from any and all business
activities conducted by it at, in or about the demised
premises during each year of the term hereof,. plus a sum
equivalent to such percentage as may be mutually agreed
upon between the parties of all sub -rentals received by the
Club from any and all sub -tenants using or occupying any
part or portion of the demised premises during said year,
less from the total of all percentage rentals a sum equiva-
lent to the minimum rental payable by the Club for said
year under the terms and provisions of the foregoing para-
graph. The percentage rental payable by the Club to the
City in excess of the minimum rental accruing for each year
of the term hereof shall be paid by the Club to the City on
or before sixty (60) days following the expiration of each
year of the term hereof and each payment of percentage
rental shall be accompanied by a full, true and correct
statement prepared by the Club indicating in detail all
gross operating revenues and sub -rentals received by it in
connection with the operation of the demised premises during
the year of the term hereof for which such payment is made.
Notwithstanding any provisions of this paragraph to the
-7-
contrary, it is agreed that the Club shall pay to the City
two per cent (2%) of the gross operating revenues of the
Club derived from the sale of off -sale liquor.
SECOND: It is hereby agreed between the parties
hereto that the Club shall pay to the City a sum equal to
two and one-half per cent (2�2-/.) of the first Thousand
Dollars of gross sales per month by.the Club's sub -tenant,
Piper -Johnson, or his successor, two per cent (2/0) of the
nest One Thousand Dollars of such gross sales per month
and one and one-half per cent (1'-2/0) of the balance of such
gross sales per month.
THIRD: It is further hereby agreed that the
said percentage rental shall not apply to gross operating
revenues of the Club derived from the portion of the origin-
ally demised premises going to the County of Orange under
the settlement of 1952.
DEFINITION OF GROSS
OPERATING REVENUES
The term "gross operating revenues", as in this
lease used, shall be deemed to mean for the purpose of
determining any percentage rental which may be payable by
the Club to the City the aggregate amount of all sales of
merchandise or services made at, in or about the demised
premises whether for cash, charge or credit (and in case
of credit or charge sales, regardless of whether the money
for such sales be collected or not) without deduction or
9 M-
allowance for costs, charges or expenses for purchase,
sale, transportation or delivery of merchandise or for
labor and materials in connection with the rendition of
services. The term "gross operating revenues", as in
this lease used, shall not, however, include the selling
price of goods which are delivered in exchange for goods
returned by customers or the price of goods returned
without.exchange upon which a refund of the purchase
price is made or cash or other discounts allowed to pur-
chasers of merchandise or services or the amount of any
tax imposed or computed upon the basis of sales made or
services rendered at, in or about the demised premises.
The term "gross operating revenues", as in this lease
used, shall likewise not include sub -rentals received from
sub -tenants carrying on and conducting a business on any
part or portion of the demised premises under any sub -lease
or sub -leases providing for a term of more than one year,
but shall include fees and charges made by the Club for
use of any facilities located at, in or about the demised
premises, such as dockage fees and charges, hotel, motel
apartment or motel rentals derived from persons not carry-
ing on and conducting a business at, in or about the
demised premises whether their use of said facilities be
under and pursuant to the terms of a sub -lease or sub-
leases, or otherwise, and sub -rentals received from sub -
ME
D
tenants carrying on and conducting a business on any
part or portion of the demised premises under any sub-
lease or sub -leases providing for a term of one year or
a lesser period.
BOOKS OF ACCOUNT
The Club shall maintain and keep a full, accu-
rate and correct account of all of its business carried
on and conducted at, in or about the demised premises' and
all of its books and records in respect to said business
shall be open to the inspection of the City and of any
authorized agent, accountant or employee of the City, and
it is specifically agreed between the parties that the
City shall have the right through its authorized agents,
accountants and employees to enter in and upon the demised
premises at any time and from time to time during reason-
able business hours for making an inspection of said
premises, and that.upon demand of the City the Club will
produce all books and records of its business done at,
in or about the demised premises at said premises for
audit and inspection by the City.
UTILITIES, TAXES
AND ASSESSMENTS
The Club shall pay and discharge prior to
delinquency all charges for water, gas, electricity,
telephone, rubbish and garbage disposal and other public
-10-
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IMPROVEMENTS,
FIXTURES AND
EQUIPMENT
The Club shall have the right and privilege of
erecting and constructing such buildings, structures and
improvements at, in or about the demised premises as it
may deem to be desirable or necessary and as shall comply
with existing building ordinances of any governmental
authority having jurisdiction over the demised premises
then in force and effect, and shall likewise have the
right and privilege of placing at, in or about the demised
premises such trade fixtures and personal property as may
appear to be desirable or necessary for the operation of
any business or other activity conducted thereat. All
buildings, structures and improvements placed at, in or
about the demised premises by the Club shall, upon the
expiration of the term of this lease or the earlier termina-
tion thereof, belong to and become the property of the
City and the Club shall have no right, title or interest
therein or any right or privilege of removing the same
therefrom. The Club, however, shall have the right and
privilege of removing from the demised premises all trade
fixtures and personal property placed or installed at, in
or about the same for a period of sixty (60) days from
and after the expiration of the term hereof or in the
event of the earlier termination of this lease for a period
of sixty (60) days from and after the effective date
-12-
0 0
thereof and all personal property and trade fixtures
not so removed by the Club within said sixty (60) day
period shall, upon the expiration thereof, be and become
the property of the City and the Club shall no longer
have any right, title or interest therein or any right
or privilege of removing the same from the demised
premises. The Club agrees to expend for upkeep and main-
tenance of all improvements placed on said demised
premises, a minimum amount of money per annum, beginning
with the fortieth (40th) year of this lease, equal to
the average per annum expenditures made for maintenance
and upkeep on said demised premises during the twentieth
(20th) to the fortieth (40th) year of this lease.
ASSIGNMENT
OF LEASE
The Club shall not assign this lease or any
interest therein without the written consent of the City
first had and obtained and this lease and the leasehold
estate created thereby shall not be assignable by opera-
tion of law or otherwise. In the event the Club shall at
any time during the term hereof be adjudicated a bankrupt
or assign over all of its estate for the payment of its
debts or in the event any execution or attachment shall
issue against the Club or any of its effects and remain
in force for a period of more than thirty (30) days, or
in the event a receiver or trustee be appointed over the
-13-
business, properties and assets of the Club whereunder
a public officer or agent shall be placed in charge of
the demised premises or any part or portion thereof and
shall so remain in charge for a period of thirty (30)
days or this lease shall by operation of law devolve upon
or pass to any person or persons other than the Club,
then and in any or either of such events the City may,
at its option, terminate this lease and the same shall
become null and void and thereafter of no effect whatso-
ever.
The Club shall not sublet the demised premises
or any part or portion thereof for the purpose of operat-
ing and conducting any business enterprise at, in or
about the same for a term in excess of the period of one
(1) year without the written consent of the City first
had and obtained, and it is agreed that any consent given
by the city to the Club authorizing it to sublet the
demised premises or any part or portion thereof shall
not be construed as a consent to any further subletting
or as a waiver of the right of the City to object to any
further subletting to which its consent in writing has
not been first had and obtained.
DEFAULT
Each and all of the covenants, agreements and
provisions in this lease contained and on the part of
-14-
the Club to be performed are conditions precedent to be
fully observed by the Club to entitle it to continue in
possession of the demised premises and in the event any
default shall be made either in the payment of rent or
other items payable to the City and continue for a period
of thirty (30) days after notice thereof in writing from
the City to the Club or in the event any default shall
be made in the observance or performance of any of the
conditions, terms or provisions hereof and continue for
a period of thirty (30) days after notice thereof in
writing from the City to the Club, then and in either of
such events this lease may, at the option of the City,
be at once terminated and at an end and the Club shall
be deemed to have forfeited all of its rights herein and
hereunder and the City may thereupon immediately reenter
and take possession of the demised premises and the whole
thereof without any further notice whatsoever to the Club.
The Club shall waive any compensation for the forfeiture
of said term or the repossession of the demised premises
by the City in the event of the forfeiture of this lease
for any of the causes aforesaid and hereby waives demand
for the possession of the premises in the event of the
forfeiture of this lease.
REMEDIES OF CITY
The various rights and remedies herein contained
and reserved to the City shall not be considered as exclu-
-15-
06
L7- r�
sive of any other right or remedy but the same shall
be construed as cumulative and shall be in addition to
every remedy now or hereafter existing at law in equity
or by statute. No delay or omission of the City to
exercise any right or power arising from any default
or omission of the Club shall impair any such right or
power or shall be construed as a waiver of any such
default or any acquiescence therein.. No waiver of the
breach of any of the covenants of this lease shall be
construed or held to be a waiver of any other breach
or waiver or acquiescence therein. No waiver of the
breach of any of the covenants of this lease shall be
construed or held to be a waiver of any other breach or
waiver or acquiescence in or consent to any further or
succeeding breach of the same covenant.
COSTS OF LITIGATION
In the event the City shall without any fault
on its part be madea party to any litigation commenced
by or against the Club the latter shall pay all costs and
reasonable attorney's fees incurred by or imposed upon
the City or by or in connection with said litigation, and
the Club shall pay all costs and reasonable attorney's
fees which may be incurred or paid by the City in enforcing
the covenants of this lease and all such costs and attor-
ney's fees when paid to said City shall be deemed addi-
tional consideration for the execution and delivery of
this lease.
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PEACEFUL ENJOYMENT
The City covenants and agrees that the Club in
performing the covenants, terms and conditions of this
lease on the.part of the Club to be kept, observed and
performed may and shall have the right at all times
during the term of this lease to quietly and peacefully
hold, possess, use, occupy and enjoy the demised premises
and all improvements which may from time to time be placed
thereon under and by virtue of this lease. Notwithstand-
ing any of the provisions of this lease, it is understood
that the same is subject and subordinate to the existing
rights and interests, if any, of Orange County Council,
Boy Scouts of America, a corporation, in respect to the
real property covered by the lease executed between the
City, as lessor, and Orange County Council, Boy Scouts
of America, as lessee, under date of April 19, 1937, in
respect to a portion of the demised premises.
INVALIDITY OF
PROVISIONS
In the event this lease in its entirety shall
be declared invalid or void by a court of competent
jurisdiction the same shall cease and determine and the
Club waives any claim of damages or right of action
against the City by reason of such invalidity but shall
be entitled, notwithstanding any of the other terms and
provisions of this lease, to remove from the demised
premises any and all buildings, improvements, trade
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fixtures and personal property placed by it thereon
for a period of sixty (60) days from and after judgment
or decree declaring said lease to be invalid or void
becoming final. However, in the event of any of the
particular terms or provisions of this lease shall be
declared invalid or void by a court of competent juris-
diction the Club waives any claim for damages or right
of action against the City by reason of such invalidity,
but shall have the option of terminating this lease by
a notice in writing given at any time on or before sixty
(60) days following the judgment or decree declaring
such terms or provisions to be invalid or void becoming
final, and in the event this lease be so terminated the
Club shall have the right of removing from the demised
premises for a period of sixty (60) days from and after
the date of said written notice any and all buildings,
improvements, trade fixtures and personal property
placed by it on the demised premises. Should the Club
not elect to exercise the option in the foregoing sen-
tence mentioned all of the terms and provisions of this
lease, other than those declared to be invalid or void,
shall remain in force and effect the same as though
said declaration had not been made. The City, in the
event of the termination of this lease under the terms
and provisions of this paragraph, shall refund to the
Club all unearned rentals paid by the Club and shall not
be entitled to receive any accrued or unpaid rentals
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which have not at the effective date of said termination
become due and payable under the terms hereof.
RELATIONSHIP
OF PARTIES
The parties agree that this lease does not create
a partnership relation between them or that of joint
adventurers and that it is intended by the parties that
this lease shall only create as between them the relation-
ship of landlord and tenant.
HOLDING OVER
The Club, upon the termination of this lease by
forfeiture or lapse of time, shall yield up immediately
the possession of the demised premises to the City or,
upon its failure so to do, shall pay to the City as liqui-
dated damages for such time as such possession is withheld
the sum of Five Thousand Dollars ($5,000) per month, but
the provisions of this paragraph shall not be held as a
waiver by the City of any right of reentry nor shall the
receipt of such liquidated damages or any part thereof or
any other act in apparent affirmance of the tenancy operate
as a waiver of the right to forfeit this lease and the term
hereby created for the period still unexpired for any
breach of any of the covenants herein contained.
NOTICES
All notices, demands or communications of any
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kind which may be required or be desired to be served
by the City or the Club upon the other under terms of
this lease, or otherwise, shall be sufficiently served,
given or made (as an alternative to personal service)
if mailed by registered mail with postage prepaid, and
if intended for the City addressed to it at City Hall,
Newport Beach, California, or at such other address
as may be hereafter furnished to the Club in writing,
and if intended for the Club addressed to it at 1221
West Coast Highway, Newport Beach, California, or at
such other address as may be hereafter furnished the
City in writing. Such service shall be deemed complete
at the expiration of forty-eight (48) hours from and
after the mailing of such notice, demand or communication.
COLLECTION OF
RENTAL DEFICIENCIES
Should the Club abandon or vacate the demised
premises the same may be relet by the City for such rent
and upon such terms as the City may see fit and in the
event a sufficient sum shall not be thus realized after
paying the expenses for such reletting and collecting to
satisfy the rents hereby reserved the Club agrees to
satisfy and pay all deficiencies year to year as the
same may be determined.
SUCCESSORS AND ASSIGNS
That each of the covenants, provisions, conditions
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I . - '
and obligations of this lease shall extend to and bind
and inure to the benefit of, as the case may be, not
only the parties hereto but each and every of their
assigns and successors in interest, and wherever in this
lease a reference to either of the parties is made such
reference shall be deemed to include, whenever applicable,
also a reference to the assigns and successors in interest
of said parties the same as if in every case so expressed.
IN WITNESS WHEREOF, the City of Newport Beach
has this day caused its corporate name to be signed and
its corporate seal to be affixed by.its Mayor and City
Clerk thereunto duly authorized by resolution of its
A
City Council dated the 8th day of March, 1948, and the
Club has caused its corporate name to be signed and its
corporate seal to be affixed by its President and Secretary
thereunto duly authorized all as of the day and year first
above written.
(SEAL)
(SEAL)
CITY OF NEWPORT BEACH
By O. B. REED
Mayor
By FRANK L. RINEHART
City Clerk
"CITY"
BALBOA BAY CLUB, INC.
By KENNETH T. KENDALL
President
By HOWARD BURRELL
Secretary
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