HomeMy WebLinkAboutC-1772 - 15th Street, 211 - Lease 2002LEASE
THIS LEASE between the CITY OF NEWPORT BEACH, a Charter City (City) and
NEWPORT HARBOR POST NO. 291 OF THE AMERICAN LEGION, a California
corporation (Lessee) is effective on the 6th ' day of December 2002 ("Effective
Date") and is made with reference to the following:
RECITALS
A. City is the owner of a parcel consisting of tidelands and/or uplands that is
generally located at 15th Street and West Bay in the City Newport Beach
(Premises). The Premises is depicted on Exhibit A, is legally described in
Exhibit B and the "Adjoining Property" is depicted and described on and in
Exhibits C and D.
B. Lessee has continuously occupied the Premises pursuant to a Lease dated
March 10, 1975 that has been amended on two occasions to extend the
term to March 2002 (Original Lease).
C. Lessee is currently in possession of the Premises and has constructed
improvements on the Premises including a marina, legion hall, parking
area, dry boat storage facilities and lockers.
D. Lessee is a non-profit public benefit corporation with approximately 2051
members as of the Effective Date including many Newport Beach residents.
American Legion Membership is available to all persons who served in any
branch of the armed forces of the United States. The marina and dry boat
storage facilities are currently available only to members of Lessee but the
legion hall is rented to members of the public on a "first come first served
basis" for weddings, parties and special. occasions.
E. On November 3, 1992, a majority of the electors of the City of Newport
Beach approved Measure M. Measure M authorizes the Newport Beach
City Council to lease tidelands and waterfront property consistent with the
provisions of State law.
F. The City has entered into an agreement with Sutherland-Talla Hospitality
(STH) pursuant to which STH has been given the exclusive right to apply
for and seek approval of all permits and approvals necessary to construct
a hotel (Hotel Project) on City owned property that is adjacent to the
Premises (Adjoining Property). This agreement between the City and STH
also obligates City, assuming STH obtains all required permits and
approvals, to negotiate, in good faith, with STH in an effort to agree on the
terms and conditions of a long term ground lease for some or all of the
Adjoining Property.
G. State Lands Commission (Commission) approval of this Lease is not
required. Commission staff has determined that this Lease conforms to
the statutes and constitutional provisions relevant to the City
administration and use of tide and submerged lands.
H. The City Council of the City of Newport Beach has determined that this
Lease is consistent with the Charter of the City of Newport Beach, the
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Newport Beach General Plan, the Land Use Plan of the Local Coastal
Program and all ordinances, resolutions, and policies presently in effect.
The City Council of the City of Newport Beach has determined that it is in
the best interests of the citizens of the City of Newport Beach to grant
Lessee a long-term ground lease of the Premises on the terms and
conditions specified in this Lease.
NOW, THEREFORE, in consideration of the mutual promises and covenants in
this Lease, the Parties agree as follows:
1. DEFINITIONS
1.1 General Definitions. As used in this Lease, the following words and
phrases shall have the following meanings:
(a) Alteration — means any addition or change to or modification
of, the Premises made by Lessee including, without limitation,
fixtures.
(b) Annual Total Rent — means Base Rent and Percentage Rent for
a Lease Year.
(c) Authorized Representative - means any officer, agent,
employee, or independent contractor retained or employed by
either Party and acting within authority given by that Party:
(d) City — means the CITY OF NEWPORT BEACH.
(e) Damage — means an injury to or deathof any Person, or the
damage destruction, or Toss of Premises caused by another
Person's acts or omissions.
(f)
Damages — means monetary compensation or indemnity that
can be recovered in the courts by any Person who has
suffered Damage.
(g) Day or Days — means calendar day(s), subject to extension for
weekends or any day when banks are not open in California if
a deadline occurs on any such Day.
(h) Expiration — means the lapse of the time specified as the Term
of this Lease.
(i) Good Condition — means the clean, safe, physical condition of
the Premises and each portion of the Premises in compliance
with all applicable governmental laws and regulations.
(j) Hazardous Materials — means any substance the nature of
which, whether in terms of quantity, existence, storage, use,
manufacture, disposal or effect, renders the substance and/or
the user or the owner of real property affected by the
substance, subject to or controlled by federal, state or local
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law, or regulation because (i) the substance is actually or
potentially injurious, or a threat, to the public's health or
welfare orto the environment; or (ii) because the substance
requires, pursuant to federal, state or local law, remediation,
removal, cleanup or other action to bring the substance andlor
the Premises into conformance with applicable law.
(k). Hold Harmless — means to protect, defend, indemnify and hold
harmless the other party (including employees, officers and,
agents) from all liability, losses, penalties, Damages, costs,
attorney fees or expenses arising out of or related to any
Damage to any Person or property.
(I) Law — means any judicial decision, statute, constitution,
ordinance, resolution, regulation, rule, administrative order, or
other requirement of any municipal, county, state, federal, or
other government agency or authority having jurisdiction over
the Parties and/or the Premises.
(m) Lease Year — means each twelve (12) month period
subsequent to the Rent Commencement Date and during the
Term.
(n) Maintenance or Maintain — means repairs, replacement,
maintenance, repainting, and cleaning.
(o) Material Default — means the failure of Lessee to cure a default
pursuant to Section 16 on or before the applicable, cure
deadline.
(p) Person — means one or more natural persons, or legal entities,
including, without limitation, partnerships, corporations,
trusts, estates, associations, or a combination of natural
persons and legal entities.
(q) Provision — means any term, covenant, condition, or clause in
this Lease that defines, establishes, or limits the performance
required or permitted by either Party.
(r) Redevelopment (with or without "of Adjoining Property") —
means any study, planning, design, construction or operation
of any portion of all or a portion of the City owned property,
other than the . Premises, bounded by 15'" Street, Balboa
Boulevard, 19"' Street and Newport Bay (including any public
facility on or serving the Premises or Adjoining Property) for
any purpose or project including the Hotel Project.
(s) Rent — means Base Rent, Percentage Rent, late payment.
penalties, interest, taxes, and other monetary amounts and
charges payable by Lessee under the Provisions of this Lease.
(t) Rent Commencement Date — means the first day of January
2003.
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(u) Successor — means any assignee, transferee, personal
representative, heir, or other Person succeeding lawfully, and
pursuant to the provisions of this. Lease, to the rights or
obligations of either Party.
(v) Termination — means the termination of this Lease, for any
reason, prior to Expiration.
1.2 "Gross Sales Revenue"
The term Gross Sales Revenue means:
(a) The entire amount of the actual consideration paid to Lessee
for all sales of merchandise, labor, service and materials and
all charges made by or on behalf of Lessee from or upon the
Premises, including orders taken on the Premises and filled
elsewhere and sales by any sublessee, or subcontractor in or
from the Premises.
(b) The gross receipts of all coin-operated.devices that are placed
on the Premises by Lessee or pursuant to any rent
concession, percentage or other arrangement but excluding
revenue collected by a public and/or private utility from
telephones.
Each sale upon installment or credit shall be treated as a sale for the
full price in the month during which the sale is made, irrespective of
the time when Lessee receives payment (whether in full or in part)
from the customer. Gross Sales Revenue shall not include sales and
use taxes, so-called luxury taxes, consumers' excise taxes, and
other similar taxes now or in the future imposed on the sale of
merchandise or services, provided the taxes are separately stated on
the invoice and added to the selling price and collected from
customers. Gross Sales Revenue shall not include the amount of
any cash or credit paid by a customer to the extent that a cash or
credit refund is given to the customer. Gross Sales Revenue shall
not include uncollectible credit accounts and other bad debts or the
proceeds of sale of Lessee's personal property, trade fixtures or
business equipment. The term gross sales shall not include any gift,
donation, bequest or other transfer of property to Lessee for
charitable purposes.
1.3 Rules of Construction. The language in this Lease shall be construed
simply, according to its fair meaning, and not strictly for or against
either City or Lessee. The term "permit" shall be interpreted to
include "cause to be permitted or allowed to be permitted." The term
"include" or "including" shall be interpreted to comprise the term
"without limitation" and shall not imply any limitation unless
otherwise expressly provided.
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•
2. LEASE OF PREMISES
City leases the Premises to Lessee and Lessee leases the Premises from
City for the Term and on and subject to the terms and conditions in this
Lease.
3. TERM
The initial Term of this Lease shall be twenty-five (25) years from the Rent
Commencement Date (initial Term) unless earlier terminated. Lessee shall
have the option to extend the Term for an additional twenty-five years
(subsequent Term) from the date of expiration of the initial Term if Lessee
(a) gives City written notice, at least sixty (60) days before expiration of the
initial Term, of its intention to exercise the option; and (b) Lessee is not in
default at the time the written notice is given and is not in default when the
initial Term expires. Should Lessee hold over and continue in possession
of the Premises after Expiration of the initial Term or the subsequent Term,
Lessee's continued occupancy of the Premises shall be considered a
month -to -month tenancy subject to termination by either Party upon thirty
(30) days prior written notice and subject to all the terms and conditions of
this Lease except the provisions of this Section.
4. RENT
Lessee shalt pay Base Rent (as adjusted periodically pursuant to Section
4.1(b)) to City each month from and after the Rent Commencement Date.
Lessee shall also pay Percentage Rent to the City if and to the extent that,
during any Lease Year, Percentage Rent exceeds the Base Rent. The
following provisions govern the calculation and payment of Base Rent and.
Percentage Rent.
4.1 Base Rent.
(a) Base Rent. Lessee shall pay Base Rent to City in the sum of
ninety-six thousand dollars ($96,000.00) per year beginning on
the Rent Commencement Date. Base Rent shall be paid in
equal monthly installments of eight thousand dollars ($8,000).
Base Rent for each full month shall be due on the Tenth (10 )
day of that month (Rent Due Date) and late on the Twentieth
(201 day of the month. Base Rent for any partial month shall
be prorated in accordance with the actual number of days in
that month.
(b) Periodic Adjustment. After the end of every fifth Lease Year,
the Base Rent shall increase by ten percent (10%) or seventy
five percent (75%) of the percentage increase in the Consumer
Price Index (Los Angeles — Anaheim — Riverside (1967 = 100)
All Urban Consumers) the average Annual Total Rent (the total
of Base Rent and Percentage Rent) for the previous five (5)
Lease Years, whichever is greater. The calculation of the
Periodic Adjustment shall be made within ninety days after the
end of every fifth Lease Year and the increase in Base Rent
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shall be effective and paid to the City as of the first Rent Due
Date after calculation of the Periodic Adjustment and each
month thereafter until Base Rent is increased pursuant to the
next Periodic Adjustment.
4.2 Percentage Rent.
(a) Calculation. Lessee shall also pay Percentage Rent if and to
the extent that Percentage Rent exceeds, for any Lease Year,
the Base Rent. Percentage Rent shall equal the total of the
sums derived from multiplying the annual Gross Sales
Revenue from the following Revenue Categories by the
corresponding Percentage Rates.
REVENUE CATEGORY PERCENTAGE RATE
Hall Rental Revenues 20%
Marina Revenues 40%
Storage Revenues 50%
Parking Lot 100%
The Gross Sales Revenue used to calculate Percentage Rent
shall include the proceeds of business interruption or rental
loss insurance to the extent the proceeds are based on and to
compensate for, the loss of any Gross Sales Revenue from
which Percentage Rent is calculated.
(b) Charges for Goods and Services. Lessee agrees to charge
prices for all goods, services and facilities (including boat slip
rentals) offered at or provided on or from the. Premises that
are, taking into consideration when appropriate the relative
size, location and condition of the facility, comparable with
prices for similar goods, facilities and services charged at
other locations in Newport Beach. Lessee may charge less
than amounts charged by similar locations if, in the exercise
of Lessee's reasonable business judgment, a lower charge will
stimulate revenue increases or is offered in connection with
advertising, promotions, discounts to employees, guests or
charitable functions.
(c) Annual Statement/Payment of Percentage Rent. Lessee shall,
within sixty (60) days following the end of each Lease Year,
provide City with a statement, in reasonable detail, of the
amount of Lessee's Gross Sales Revenue for each Revenue
Category during the preceding Lease Year. The statement
shall also calculate the Percentage Rent due for the preceding
Lease Yearbased on the Gross Sales Revenue in each
Revenue Category multiplied by the corresponding
Percentage Rates. The statement shall be accompanied by
payment of the amount, if any, of the Percentage Rent due for
the preceding Lease Year.
(d) Failure to Submit. Lessee shall be in default, and City shall
have the right, in addition to any other rights or remedies, to
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(e)
conduct an audit at Lessee's expense if Lessee fails to provide
City with the annual statement and/or the Percentage Rent as
specified in Subsection (c).
Termination. City may terminate this Lease upon written
notice given at any time within thirty (30) days after receipt of
an audit that concludes that the Annual Gross Sales Revenue
and/or Percentage Rent is three percent (3%) or more above
the amount shown on the Annual Statement and/or Percentage
Rent paid to City.
4.3 Payment Location. Rent shall be payable at the office of the City's
Revenue Division at 3300 Newport Boulevard, Newport Beach,
California, or at such other place or places as City may from time to
time designate by written notice delivered to Lessee.
4.4 Production of Statement, Records and Audit. Lessee agrees to make
available for inspection by City, or its Authorized Representative, at
the Premises a complete and accurate set of books and records of
all sales of merchandise and revenue derived from the conduct of
business or activity in, at or from the Premises from which Gross
Sales Revenue can be determined. Lessee shall also make available,
upon City's request, all supporting records, including federal, state
and local tax returns. Lessee shall also furnish City's Authorized
Representative, upon request, with copies of its quarterly Califomia
sales and use tax returns filed with the State of California. Lessee
shall retain and preserve for at least Three (3) years all records,
books, bankbooks or duplicate deposit books and other evidence of
Gross Sales Revenue. City and its Authorized Representative shall
have the right, upon reasonable notice, during the Term or any
Option Term, to inspect and audit Lessee's books and records and to
make transcripts to verify the Rent due City. The audit may be
conducted at any reasonable time during normal business hours.
Lessee shall cooperate with City in making the inspection and
conducting the audit. City shall also be entitled, once during each
Lease Year and within Two (2) years after its end, and once within
one hundred eighty (180) days after Expiration or Termination of this
Lease, to an independent audit of Lessee's books of account,
records, cash receipts, and other pertinent data to determine
Lessee's Gross Sales Revenue. The audit shall be conducted at
City's sole cost and expense by a certified public accountant
designated by City. The audit shall be limited to the determination of
Gross Sales Revenue and shall be conducted during usual business
hours in a manner that minimizes any interference with the conduct
of Lessee's regular business operations. If the audit concludes that.
there is a deficiency in the payment of any Rent, the deficiency shall
become due and payable within twenty (20) days and if there is an
overpayment, City shall refund the amount of the overpayment
within twenty (20) days. City shall bear its costs of the audit unless
the audit shows that Lessee understated Gross Sales Revenue by
more than three percent (3%), in which case Lessee shall pay the
reasonable cost of the audit. City and City's Authorized
Representative shall be required to keep confidential to the
maximum extent permitted by law any information gained from such
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documents, statements, inspections or audits confidential. City and
its Authorized Representative shall not disclose financial information
received in confidence and pursuant to this Lease except to carry
out the purposes of this Lease unless the law requires, as opposed
to permits, disclosure. However, City may disclose the results of
any audit in connection with any financing arrangements, the sale or
transfer of City's interest in the Premises, or pursuant to order of a
court or administrative tribunal.
4.5 Lessee's Gross Sales Revenue Audit. In the event of any audit by
City in accordance with this Lease, Lessee may contest the results
of City's audit by performing a confirming audit within thirty (30)
days of receipt of City's audit results and supporting evidence, using
an independent public accountant reasonably acceptable to City. If
Lessee's audit discloses that City's audit was incorrect by more than
three percent (3%), then City shall pay the cost of Lessee's
contesting audit.
4.6 Late Payment Penalty. Rent shall be late if paid on or after the
Twentieth (201 day of the month due. Late Rent shall be assessed a
One (1) time penalty of five percent (5%) of the amount due and shall
bear interest at the rate of ten percent (10%) per annum on the
unpaid balance (including Rent, late payment penalty and accrued
interest) calculated from the date that Rent was due to the date that
the balance is fully paid.
5. USE OF PREMISES
5.1 Approved Uses. Lessee shall use the Premises only for the
purposes specified in this Section (Approved Uses). Lessee may
not use the Premises for any other use except with prior written
consent of the City Manager. Lessee may temporarily utilize a
portion of the Premises for uses not authorized by this Section upon
securing any required permit from City acting in its governmental
capacity. Lessee shall be entitled to maintain the following:
(a) A Legion Hall of approximately 10,000 square feet and an
ancillary food/drink service area.
(b) A marina consisting of 49 slips with 34 lockers.
(c) Dry boat storage and lockers consisting of 47 spaces and 43
dinghy racks.
(d) Parking lot consisting of 26 spaces.
5.2 City/Community Use. When Lessee is not using the Premises, the
Premises and structures shall be available for use as a community
center and recreation instruction facility by the City on a first
priority -basis, and by local organized community or civic
organizations in accordance with reasonable rules, regulations, fees
and scheduling to be established by Lessee with the approval of the
City Manager.
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5.3 Operation of Premises. Lessee shall operate and manage the
Premises in a manner comparable to an organization similar to the
American Legion providing similar facilities or services. Lessee
shall not use the Premises in any manner that: (a) creates a
nuisance; (b) violates any Law; or (c) is not in compliance with all
statutes, laws, permits, use restrictions and regulations of City
applicable to the Premises, Lessee and/or Lessee's use of the
Premises.
5.4 Advertising Display. Lessee may, at its own expense, place signs in
or upon the Premises subject to the prior written consent of the City
Manager as to the size, type, design and method of installation. All
signage placed by Lessee on, in or about the Premises shall be
removed by Lessee upon Termination or Expiration of this Lease and
any damage caused by removal shall berepaired at Lessee's
expense. Any permanent signage in place as of the Execution Date
of this Lease shall be deemed approved by the City.
5.5 Independent Contractor. City shall have no interest in the business
of Lessee and no liability for the business operations or
diminution/loss of Gross Sales Revenue whether or not caused by
City's enforcement of Law.
5.6 Parking. Lessee shall provide a total of 26 off-street parking spaces.
The provision of these spaces satisfies the requirements of Title 20
of the Newport Beach Municipal Code. Lessee shall not permit any
repair of vehicles on the Premises.
5.7 No Discrimination. Lessee shall allow members of the general
public, through a reservation system, to use the Legion Hall for
special events on a non-discriminatory basis. Lessee shall not
discriminate on the basis of gender, race, religion, or other criteria
that violates constitutional or statutory law with respect to the use or
occupancy of the Premises.
6. SPECIAL PROVISIONS
The provisions of this Section represent special and unique circumstances
and consideration related to this Lease and the proposed Redevelopment
of all or any portion of the Adjoining, Property. The terms and conditions of
this Section are material and the failure to comply shall constitute a
material breach on the part of Lessee or, in the case of the charter and
minimum membership provisions, cause a forfeiture of this Lease.
6.1 Charter/Membership. City has entered into this Lease based on
Lessee's representation that Lessee is a an American Legion Post
that is chartered by the American Legion, that Lessee's membership
consists of a substantial number of persons and that membership in
the American Legion and Newport Harbor Post No. 291 is contingent
only upon having served in an active duty capacity in the military
forces of the United State. Lessee acknowledges that the minimum
membership provisions of this Lease are crucial to the finding by the
City Council that this Lease is consistent with City's obligations
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pursuant to statutory, constitutional and decisional law related to the
permitted use of tide and submerged lands. Accordingly, Lessee
agrees to maintain a minimum membership of one thousand two
hundred (1200) natural persons. Lessee shall, within thirty days
after the end each Lease Year, provide City with access to a list of all
active members so City can confirm compliance with the minimum
membership requirement. Lessee agrees to forfeit all of its rights
and interests under this Lease if, at any time during the Term,
Lessee fails to satisfy the minimum membership• provisions of this
Lease or fails to maintain its current affiliation and relationship with
the American Legion.
6.2 Cooperation. Lessee shall fully cooperate with City, and City's
tenants (other than Lessee), contractors, representatives and
assignees (Agents) in the Redevelopment of the Adjoining Property.
Lessee's obligation to cooperate with the Redevelopment includes
the general and specific requirements in this Section.
(a) General. Lessee shall allow City and/or its Agents to take any
action, including the right to enter to conduct tests, surveys
and studies with respect to the Premises in conjunction with
the Redevelopment of Adjoining Property provided the tests,
surveys or studies do not unreasonably interfere with
Lessee's ability to conduct business on the Premises. Lessee
shall allow City and/or its Agents to enter onto the Premises
subject only to the obligation of City and its Agents to give
Lessee seventy two (72) hours prior written notice and the
obligation of the City to, at its sole cost, to commence repair
of any Damage to the Premises caused by the City or its
Agents, within twenty-four (24) hours after causation.
(b) Occupation of Premises. In addition to the general obligation
of Lessee to cooperate in Redevelopment, City and/or its
Agents shall have the right to occupy any portion of the
Premises, except the Legion Hall, Marina and necessary
access to each, for: (i) a period of up to 12 consecutive
months once during the term of this Lease; and (ii) a total of
twenty-four (24) months during the Term. The right of City
and/or its Agents to occupy a portion of the Premises is
contingent upon City's execution of, and compliance with, an
agreement that (i) compensates Lessee for the period of
occupation; and (ii) holds Lessee harmless from any claim,
loss, damage or liability proximately caused by the
occupation. City or its Agents shall, in the course of any
occupation of a portion of the Premises, ensure that at least 13
on -site parking spaces remain accessible to Lessee and its
invitees. City shall also take all reasonable action to mitigate
the impact of any occupation on Lessee such as temporary
suspension of on street parking charges or the issuance of
short term "no -fee" parking permits to Lessee and/or its
invitees. The compensation for occupation shall be calculated
on the basis of the average revenue during the six (6) months
prior to occupation that was derived from for the use of that
portion of the Premises being occupied. For example, if the
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occupation is four (4) months and the average month revenue
for the preceding six (6) months from that portion of the
Premises was one thousand dollars ($1000.00), the
compensation would be four thousand dollars ($4,000.00).
In the event of an occupation of a portion of the Premises, City
may authorize Lessee to conduct its operations from facilities
located on the Adjoining Property during the term of the
occupation.
6.3 RENOVATION
(a) Plans/Permits. Lessee shall, within thirty (30) days after
receipt of written notice from City and at Lessee's sole cost
and expense, commence preparation of plans for the
remodeling and renovation of the structures on the Premises
(Renovation). The Renovation shall be designed and
constructed in a manner that ensures architectural
compatibility with any structures to be constructed on
Adjoining Property pursuant to any Redevelopment. The
written notice to proceed shall generally specify the
architectural criteria for compatibility and Lessee shall submit
conceptual designs for the Renovation to the City for approval
or modification within sixty (60) days after notice. The
conceptual designs shall assume a construction cost of not
less than two hundred and fifty thousand dollars ($250,000.00)
subject only to a credit in the sum of ten thousand dollars
($10,000) for maintenance performed between the Effective
Date and the date of the notice to proceed. City shall approve
or conditionally approve the conceptual designs, taking into
consideration the assumed construction costs, within thirty
(30) days after submittal. Lessee shall, within sixty days after
City approval or conditional approval, prepare final
construction plans and specifications that are consistent with
the approval or conditional approval as well as the assumed
construction costs and submit the plans to the City for
issuance of permits. City" shall waive all fees related to the
issuance of permits for the plans.
(b) Construction. Lessee shall not be obligated to commence
construction of the Renovation until final approval of all
necessary permits and City has given Lessee written notice to
proceed. The written notice to proceed shall specify the date
on which construction is to commence but in no event shall
Lessee be required to commence construction Tess than sixty
(60) days after the notice to proceed. Lessee shall commence
construction on or before the date specified in the notice to
proceed and diligently pursue construction to completion.
Lessee shall construct the Renovation at Lessee's sole cost
and expense.
Undergrounding. Lessee shall, in conjunction with the
Renovation, underground all utilities on the Premises at
Lessee's sole cost and expense. The cost and expense of
(c)
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undergrounding utilities is exclusive of, and in addition to, the
minimum cost of Renovation as specified in this Subsection.
(d) Water Main. In the event City undertakes a project to increase
the size of, or replace, the water main in Balboa Blvd or 15th
Street, City shall install, at its sole cost and expense, a "tee
connection" and/or any other facility that will enable Lessee to
improve its fire suppression capacity and/or fire suppression
facilities.
6.4 Tidelands Agreement. The State Lands Commission staff contends
that a substantial portion of the property bounded by Balboa Blvd.,
15"' Street, 1811' Street and Newport Harbor is tidelands. City and the
State Lands Commission may, at some time in the future, consider
approval of a boundary line agreement to resolve any dispute
relative to the appropriate tidelands boundary. City commits not to
approve any boundary line agreement that would materially alter the
rights of Lessee pursuant to this Lease. Lessee acknowledges that a
boundary line agreement that does not impact its rights pursuant to
this Lease would be in Lessee's best interests and agrees to support
approval of any such agreement.
7. TAXES, LICENSES AND OTHER OBLIGATIONS
7.1 Payment of Taxes. Lessee acknowledges that this Lease may create
a possessory interest subject to taxation. Lessee shall pay, before
delinquency, all taxes, assessments, license fees and other charges
(Taxes) that are levied or assessed Lessee's interest in this Lease or
any fixture, improvement, equipment and other property on the
Premises. Lessee shall pay directly to the appropriate taxing
authorities all Taxes at least Ten (10) days before delinquency and
before any fine, interest or penalty is due or imposed by operation of
law. Lessee shall provide City with a copy of the check used to pay
any Taxes with the Rent payment due immediately after Lessee
receives with the monthly bank statement the check used to pay the
Taxes. Lessee shall not be required to pay any Taxes based on
City's ownership interest in the Premises.
7.2 Payment of Obligations. Lessee shall promptly pay, when due, any
and all bills, debts, liabilities and obligations incurred by or charged
to Lessee in connection with Lessee's occupation and use of the
Premises. However, the provisions of this subsection shall not
prevent Lessee from contesting the validity of any lien, claim or
demand, provided that in such event, Lessee shall, at its expense,
defend itself and City against the same and shall pay and satisfy any
adverse judgment that may be rendered before enforcement against
City or the Premises.
7.3 Challenge to Taxes. Lessee shall have the right in good faith, at its
sole cost and expense, to contest the amount or legality of any
Taxes including the right to apply for reduction. If Lessee contests
payment of Taxes, Lessee's failure to pay the Taxes shall not
constitute a default as long as Lessee complies with the provisions
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of this Section. City shall not be required to join in any proceeding
or contest brought by Lessee unless the Law requires joinder of the
City and in that case City shall join in the proceeding, permit it to be
brought in City's name and shall execute any necessary or
appropriate document necessary so long as City is not required to
bear any cost or liability for payment of Taxes. Lessee shall, on final
determination of the proceeding or contest, immediately pay such
disputed tax and also discharge any decision or judgment rendered,
together with all related costs, charges, interest and penalties and
provide City with a copy of Lessee's payment as and when ,provided
in Section 7.1. Lessee shall Indemnify and Hold Harmless the City
and its officers and employees from and against any liability, claim,
demand, penalty, cost or expense arising out of or in connection
with any contest or proceeding prosecuted by Lessee pursuant to
this Section.
7.4 License. Lessee shall maintain in good standing all required
licenses and permits required for operation of the business on the
Premises, including but not limited to a City Business License.
8. UTILITIES AND REFUSE COLLECTION
8.1 Basic Utilities. Lessee shall make all arrangements for and pay for
all utilities furnished to or used on the Premises, including, gas,
electricity, water, telephone service and cable TV. Any repair to
utility lines within the Premises is the sole responsibility of Lessee.
Lessee bears all risk of interruption, cancellation and/or disruption
of utility services, as well as the cost of all utilities Lessee requires
for its use of the Premises.
8.2 Refuse Collection. Lessee shall make arrangements for and pay for
all refuse collection and Hazardous Materials disposal. Lessee shall
keep the Premises free and clean of rubbish and litter and shall
deposit accumulated rubbish and litter in containers designated by
City. Trash containers shall be kept in an approved enclosed area
and shall be emptied on a regular basis. Lessee shall comply with
the provisions of the Newport Beach Municipal Code and all other
Laws regarding the use, storage and disposal of Hazardous
Materials. In no event shall Lessee allow Hazardous Materials
related to the Premises to enter, be disposed of into, seep or
otherwise be released into any sewer line, soil, storm drain and/or
waterway on, under or adjacent to the Premises.
8.3 Undergroundinq. Lessee shall fully cooperate in, and support, any
effort to underground utilities on and in the vicinity of the Premises
such as the formation of any district for the purpose of funding or
implementing a program to underground utilities. Lessee shall,
upon formation of any such district, pay all costs and assessments
required in conjunction with the undergrounding of utilities.
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9. ALTERATIONS TO THE PREMISES
9.1 Alterations Requiring Building Permits. Any alteration that requires
a building permit from City shall require the written consent of the
City Manager. The City Manager's written consent shall not be
unreasonably withheld so long as the permit is requested in
conjunction with and furtherance of an Approved Use. The
provisions of Section 6.2 shall control with respect to alterations.
made in conjunction with the Renovations.
9.2 Non -Structural Alterations. Lessee shall have the right to make, at
its sole expense, such non-structural changes, alterations,
improvements and additions in and to the interior of the buildings, or
to the piers, slips, floats and ramps on Premises, and Lessee may
install any trade fixtures and equipment as it may deem advisable for
the conduct of any Approved Use of the Premises.
9.3 Alterations Costing More than $50,000. Except as otherwise
provided in Section 6.2 pertaining to Renovations, Lessee shall not
make any Alterations (other than non-structural Alterations costing
less than fifty thousand dollars ($50,000.00]) to the Premises without
the prior written consent of the City Manager which shall not be
unreasonably withheld if in conjunction with and in furtherance of
any Approved Use. In granting or withholding consent to proposed
Alterations by Lessee, the City Manager shall consider the impact of
the proposed Alterations on public views adjacent Premises owners,
compliance of City codes and the impact of the proposed Alterations
on any private or public use of the Adjoining Property. The City
Manager may require, as a condition of approval, that Lessee agree
to amendments to this Lease, including. amendments increasing the
amount of Rent payable under this Lease if the proposed Alterations
would materially increase the floor area or size of the building
structures on the Premises. The City Manager may also require
Lessee to provide, at Lessee's expense, appropriate engineering and
feasibility studies regarding the structural integrity of the Premises.
Any damages or destruction to the structural improvements or
Lessee equipment at the Premises shall not reduce or excuse
Lessee's obligation to pay Rent in full and on time.
9.4 Quality of Work Performed. All work shall be performed in a good
and workmanlike manner, shall substantially comply with the plans
and specifications submitted to City and shall comply with all
applicable governmental permits and Laws in force at the time
permits are issued.
9.5 Payment of Costs. Lessee shall pay all costs related to the
construction of any Alterations by Lessee or its agents. Lessee shall
use its best efforts to keep the. Premises free and clear of all
mechanics' liens resulting from construction performed at the
direction of Lessee. All construction improvements shall, upon
completion, become part of the Premises, owned by City. However,
the provisions of this subsection shall not prevent Lessee from
contesting the validity of any lien, claim or demand, provided that in
such event, Lessee shall, at its expense, defend itself and City
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against the same and shall pay any adverse judgment that may be
rendered before enforcement against City or the Premises.
9.6 Indemnification. Lessee shall Hold Harmless City and its officers
and employees with respect to any Damage or Damages related to
any work performed on the Premises by Lessee. City shall promptly
provide Lessee with a copy of any claim filed by any third party with
respect to work performed by Lessee. City has no obligation to or
liability to Lessee incident to City's approval of Lessee's plans or
issuance of permits for any improvements to the Premises.
9.7 Disposition of Alterations at Expiration or Lease Termination. Any
Alterations made to the Premises shall remain on, and be
surrendered with, the Premises on Expiration or Termination of this
Lease (Excluding Lessee's fixtures, equipment, furniture, movable
decorations and the like). However, City may elect not less than
thirty (30) days prior to Expiration or Termination of this Lease, to
require Lessee to remove, at Lessee's cost, any Alterations that
Lessee has made to the Premises, except those Alterations existing
as of the date of this Lease or approved by City excluding any
Lessee related Hazardous Materials or other clean-up of any
environmental contamination which shall remain a Lessee
obligation. If City requires removal of Alterations, Lessee shall, at its
cost, remove the Alterations and restore the Premises to its
condition prior to installation of such Alterations, ordinary wear and
tear excepted, before the last day of the Term, or within thirty (30)
days after notice is given, whichever is later. Prior to Expiration or
within fifteen (15) days. after Termination of this Lease, Lessee may
remove any movable partitions, machinery, equipment, furniture, and
trade fixtures previously installed by and solely paid for by Lessee,
provided that Lessee repairs any damage to the Premises caused by
removal and the structural integrity of the foundation and bulkhead
areas of the Premises are not adversely impacted.
10. REPAIRS AND MAINTENANCE OF PREMISES
10.1 Maintenance and Repair by Lessee and City. Lessee agrees that it
will maintain the Premises in Good Condition. City shall be
responsible solely for the maintenance of the vertical bulkheads
serving the Premises excluding damage or deterioration caused to
any bulkhead by Lessee or Lessee's operations for which Lessee
shall be responsible. Lessee shall also, at its sole cost and expense,
at all times during the Term, maintain all other improvements and
equipment on the Premises including entrances and exits, plate
glass, roofs, doors, exterior and interior painted areas, HVAC
equipment, electrical circuits and switchgear, utility supply lines,
plumbing and other fixtures, equipment, interior walls, ceilings and
floors, piers, concrete foundations, fencing, gates, asphalt areas,
slips, floats and ramps, in good order, condition and repair. City
may perform Maintenance or repairs in the event Lessee fails to
commence required Maintenance or repairs within fifteen (15) days
after receipt of notice to do so. The cost of any Maintenance or
repairs by the City pursuant to this Section shall be payable upon
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billing by City as additional Rent with the Lessee's next monthly
Rent payment.
10.2 Entry by City. City may enter upon and inspect the Premises at any
reasonable time for Maintenance or other purposes. In case of
emergency, City or its Authorized Representatives may enter the
Premises by the master key if Lessee is not present to open and
permit an entry. During entry, City shall exercise reasonable care
relative to the Premises and to Lessee's Property. Any entry to the
Premises by City shall not be construed as a forcible or unlawful.
10.3 Acceptance As Is. Lessee is the long-time tenant of the Premises, is
fully aware of the condition of the Premises and accepts the
condition of the Premises "as is" on the date of this Lease without
any City warranty, representation or repair obligation.
11. LIENS
Lessee shall use its best efforts to prevent the enforcement against all or a
portion of the Premises of any mechanics', materialman's, contractors' or
other liens arising from, or any claims for damages growing out of, any
work or repair or alteration (except from the actions of City), and Lessee
use its best efforts to pay or cause to be paid the liens and claims before
any action is brought to enforce the same against Lessee or the Premises,
or shall adequately indemnify City and the Premises by payment bonds
acceptable to City and as provided for by Law. However, the provisions of
this Section shall not prevent Lessee from contesting the validity of any
lien, claim or demand, provided that in such event, Lessee shall, at its
expense, defend itself and City against the same and shall pay and satisfy
any adverse judgment that may be rendered before enforcement against
City or the Premises.
12. INDEMNITY AND EXCULPATION; INSURANCE
12.1 Exculpation of City. Except as otherwise expressly provided in this
Lease, City shall not be liable to Lessee for any damage to Lessee or
Lessee's Premises (including any boat owned by any Lessee
customer) goodwill, increased Lessee operating costs, or loss of
business or income by Lessee from any cause other than the gross
negligence or intentional or willful acts of City. Except as otherwise
expressly provided in this Lease, Lessee releases and also waives
all claims against City for Damages arising for any reason other than
the gross negligent, intentional or willful acts of City or its
Authorized Representatives. City shall not be liable to Lessee for
any Damage to the Premises, Lessee's Premises, Lessee's goodwill,
or Lessee's business income, caused in whole or in part by acts of
nature including, without limitation, waves, wind and tidal flows.
12.2 Lessee Release and Hold -Harmless. Lessee releases the City and
also agrees to Hold Harmless the City, its elected officials, officers
and employees from any and all claims, liability, loss, Damage, or
expenses resulting from Lessee's occupation and use of the
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Premises, specifically including, without limitation, any claim,
liability, Toss, or Damage arising by and Lessee assumes all
corresponding risk because of:
(a) The death or injury of any Person caused or allegedly caused
by the condition of the Premises or an act or omission of
Lessee or an agent, contractor, employee, servant, sublessee
or concessionaire of Lessee; and
(b) Any work performed on the Premises or materials furnished to
the Premises at the request of Lessee or any agent or
employee of Lessee, with the exception of Maintenance
performed by City; and
(c) Lessee's failure to perform any provision of this Lease or to
comply with any requirement of Law or any requirement
imposed on the Premises by any duly authorized
govemmental agency or political subdivision.
Lessee's obligations pursuant to this Subsection shall not extend to any
claim, loss, liability, Damages, costs or fees that are proximately caused by
the sole gross negligence, willful misconduct, or unlawful or fraudulent
conduct on the part of the City or its officers or employees.
12.3 Insurance Limits.
(a) Liability Insurance. Lessee shall, at its own cost and expense,
secure and maintain during the entire Term a broad form
commercial general liability insurance policy issued by an
insurance company reasonably acceptable to City covering
the acts and omissions of Lessee, any Lessee employee,
agent customer, independent contractor or visitor to the
Premises. The policy shall name City, and its officers,
employees and agents as additional insureds and protect,
against loss or liability caused by or connected with Lessee's
occupation and use of the Premises under this Lease in
amounts not less than: combined single limit bodily injury and
Premises damage, including products/completed operations
liability and blanket contractual liability, of two million dollars
($2,000,000.00) per occurrence, subject to increased limits in
accordance with Section 12.3(b).
(b) City's Ability to Increase Amount of Public Liability and
Premises Damage Insurance. Not more frequently than once
every five (5) years, Lessee shall increase the insurance
coverage as reasonably required by City so that at all times,
the amount of public liability and Premises damage insurance
coverage maintained by Lessee reasonably and fully protects
the City.
(c) Deductibles. Any deductible amount under each insurance
policy shall not exceed seven thousand five hundred dollars
($7,500.00) without the express written consent of the City
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a •
Manager and Lessee is responsible for payment of such
amount in the event of any Damage.
12.4 Fire Insurance on Building and Other Improvements. Lessee at its
cost shall maintain on the Buildings and other improvements that
are or become a part of the Premises a policy of standard broad form
all-risk fire and extended coverage insurance, with vandalism and
malicious mischief endorsements, to the extent of at least full
replacement value, with coverage for demolition and compliance
with future Building Codes in a form acceptable to the City Manager.
The insurance policy shall be issued in the names of City and
Lessee, as their interests appear... The insurance policy shall provide
that any proceeds shall be made jointly payable to City and Lessee.
12.5 Determination of Replacement Value. The "full replacement value"
of the Buildings and other improvements to be insured under
Section 12 shall be determined by the company issuing the
insurance policy at the time the policy is initially obtained. Not more
frequently than once each year, either Party shall have the right to
notify the other Party that it elects to have the replacement value re-
determined by such underwriting insurance company. The re-
determination shall be made promptly and in accordance with the
rules and practices of the Board of Fire Underwriters, or a like board
recognized and generally accepted by the insurance company. Each
Party shall be promptly notified of the re -determination by the
company. The insurance policy shall be adjusted according to the
re -determination.
12.6 Loss of Rent Insurance. Lessee at its cost shall maintain loss of rent
insurance (or business interruption insurance) insuring that the
Base Rent will be paid to City for a period up to Twelve (12) months if
the Premises are destroyed or rendered unusable or inaccessible for
commercial purposes by a risk insured under a special form
Premises coverage policy including vandalism and malicious
mischief endorsements.
12.7 Workers' Compensation. Lessee shall comply with all of the
provisions of the Workers' Compensation Insurance and Safety Acts
of the State of California and the applicable provisions of Divisions 4
and 5 of the California Labor Code.
12.8 Waiver of Subrogation. The parties release each other, and their
respective Authorized Representatives, from any claims for Damage
to any Person or to the Premises and to the fixtures, personal
Premises, and Alterations of either in or on the Premises that are
caused by or result from risks insured against under any insurance
policies carried by the parties and in force at the time of any Damage
or required to be carried under this Lease. Lessee shall cause each
insurance policy obtained by it to provide that the insurance
company waives all rights of recovery by way of subrogation against
the City in connection with any Damage covered by any policy of
Premises insurance. Neither party shall be liable to the other for any
Damage caused by fire or any of the risks insured against under any
insurance policy required by this Lease. If any insurance policy
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cannot be obtained with a waiver of subrogation, or is obtainable
only by the payment of an additional premium charge above that
charged by the insurance company issuing policies without a waiver
of subrogation, the Party undertaking to obtain the Insurance shall
notify the other Party of this fact. The other Party shall have a period
of twenty (20) days after receiving the notice either to place the
insurance with a company that is reasonably satisfactory to the
other Party and that will carry the insurance with a waiver of
subrogation, or to agree to pay the additional premium. The Party is
relieved of the obligation to obtain a waiver of subrogation rights
with respect to the particular insurance involved if the insurance
cannot be obtained with a waiver of subrogation or the other Party
refuses to pay the additional premium.
12.9 Other Insurance Matters. All the insurance required under this Lease
shall:
(a) Be issued by insurance companies authorized to do business
in the State of California, with a minimum Best Insurance
Guide or financial rating of A -VD unless otherwise approved in
advance by City Risk Manager;
(b) Be issued as a primary policy;
(c) Be noncontributing with any insurance that may be carried by
City;
(d) Contain an endorsement requiring Thirty (30) days written
notice from the insurance company to both Parties before
cancellation or material change in the coverage, scope or
amount of the policy; and
(e) Lessee shall maintain insurance for all boats being repaired or
stored at the Premises to protect City from any liability
concerning third party property located at the Premises.
Each policy, or a certificate of the policy, together with evidence of
payment of premiums, shall be deposited with City and on renewal of the
policy not less than thirty (30) days before expiration of the term of the
policy. Either Party may maintain for its own account any insurance not
required under this Lease, but any such policy shall be separate from and
non-contributory in the event of loss covered by insurance carried by the
Party responsible for said Toss as required by this Lease.
13. DAMAGE OR DESTRUCTION OF PREMISES
13.1 Destruction of Premises. If the Premises are totally or partially
destroyed, rendering the Premises or any portion totally or partially
inaccessible or unusable, Lessee shall restore the Premises, at
Lessee's sole cost and effort, to substantially the same condition as
immediately prior to such destruction (including all trade fixtures,
personal Premises, improvements and Alterations as are installed by
Lessee, which shall be replaced by Lessee at its expense, unless
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Lessee elects to terminate this Lease pursuant to this Section.
Lessee can elect to terminate this Lease by giving notice of such
election to City within sixty (60) days after the date of the occurrence
of any casualty and also proving to the reasonable satisfaction of
City that each of these conditions are satisfied:
(a) The cost of the restoration exceeds the amount of any
available insurance proceeds by at least twice the Total
Annual Rent for the most recent two (2) completed Lease
Years;
(b) At the time of such casualty Lessee maintained all insurance
required by this Lease; and
(c) No act attributable to Lessee voided insurance coverage
otherwise available concerning the Damage or loss.
If the Lease is terminated, all insurance proceeds applicable to
reconstruction (excluding Lessee's personal in the Premises) shall
be assigned by Lessee to City and Lessee shall pay any policy
deductible to City. Lessee shall Hold Harmless the City from any
expenses, liability or loss regarding damage or loss to boats being
repaired or stored by Lessee at the Premises and any other liability
or loss incurred by Lessee concerning such casualty and event.
13.2 Replacement of Lessee's Premises. In the event of the damage or
destruction of improvements located on the Premises not giving rise
to Lessee's option to terminate this Lease under Section 13.1,
Lessee shall, at its own expense, replace and repair all Lessee's
trade fixtures, equipment, furnishings and inventory as soon as
reasonably possible to permit the prompt continuation of Lessee's
business at the Premises for the Approved Use.
14. ABATEMENT OF RENT
In the event of Damage or destruction• of the Premises and this Lease is not
terminated, Lessee shall continue to utilize the Premises for the operation
of its business for the Approved Use to the extent it may be practicable and
commercially reasonable. Base Rent shall abate in proportion to the area
of the Premises that is rendered unusable for the Approved Use. The
abatement of Rent shall commence on the date that use of the Premises is
impacted and continue for so long as is reasonably required to complete
those repairs necessary to restore full use of the Premises and Lessee's
re -opening of the Premises. Lessee's obligation to pay Taxes and other
monetary obligations pursuant to this Lease shall not be abated or
reduced. Rent shall not abate if the Damage or destruction to the Premises
is the result of the negligence or willful conduct of Lessee or its
employees, officers or agents. Lessee's right to abatement of Base Rent is
contingent on payment of insurance proceeds, if any, equal to the amount
of Base Rent pursuant to the coverage required by this Lease.
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15. PROHIBITION AGAINST VOLUNTARY ASSIGNMENT, SUBLETTING AND
ENCUMBERING
15.1 Prohibition. The Parties acknowledge that City is entering into this
Lease in consideration of the unique nature of Lessee and special
circumstances pertaining to Lessee's prior history as a tenant.
Consequently, Lessee shall not voluntarily delegate, assign or
encumber its interest in this Lease or in the Premises, or sublease
substantially all or any part of the Premises, or allow any other
person or entity (except Lessee's Authorized Representatives) to
occupy or use all or any part of the Premises without the prior
written consent of City, which may be withheld at the sole discretion
of the City.
15.2 Effect of Consent. City's consent to any assignment, encumbrance,
or sublease shall not relieve Lessee from its obligations or liabilities
under this Lease nor act as a waiver of the requirement that such
consent be obtained to any subsequent assignment, encumbrance
or sublease.
16. DEFAULT
16.1 Default by Lessee. The occurrence of any one or more of the
following events shall constitute a "Material Default" of this Lease by
Lessee:
(a) The vacating or abandonment of the Premises by Lessee.
(b) The failure by Lessee to make any payment of Rent or any
other payment required by this Lease, as and when due, when
such failure shall continue for a period of Ten (10) days after
written notice of default from City to Lessee.
(c) The failure of Lessee to observe or perform any of the
"material" (meaning costing five thousand dollars ($5,000.00)
or more to fully remedy covenants, conditions or provisions of
this Lease to be observed or performed by Lessee where the
failure continues for a period of thirty (30) days after written
notice from City to Lessee; provided, however, that if the
nature of Lessee's default is such that more than thirty (30)
days are reasonably required for its cure, then Lessee shall
not be deemed to be in default if Lessee commences such
cure within said thirty (30) day period and then diligently
prosecutes the cure to completion. However, no thirty (30)
day cure period is allowed for any Lessee caused
-environmental event involving Hazardous Substances at the
Premises or otherwise caused by Lessee or Lessee's agents
or customers that is estimated to cost fifteen thousand dollars
($15,000.00), or more, to fully remediate. Immediately
following any environmental event, Lessee shall use Lessee's
best efforts to fully remediate or prove to the reasonable
satisfaction of City that remediation is underway and will be
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(f)
completed in ninety (90) days without any risk of further
environmental damage to the Premises and/or surrounding
area.
(d) The making by Lessee of any general arrangement or
assignment for the benefit of creditors.
(d) Lessee becomes a "debtor" as defined in 11 U.S.C. Section
101 or any successor statute thereto (unless, in the case of a
petition filed against Lessee, the same is dismissed within
sixty (60) days).
(e) The appointment of a trustee or receiver to take possession of
substantially all of Lessee's assets located at the Premises or
of Lessee's interest in this Lease, where such appointment is
not discharged within sixty (60) days.
The attachment, execution or the judicial seizure of
substantially all of Lessee's assets located at the Premises or
of Lessee's interest in this Lease, where such seizure is not
discharged within sixty (60) days.
16.2 Remedies.
(a) Cumulative Nature of Remedies. If any Material Default by
Lessee shall not be cured as required in Section 16.1, City
shall have the remedies described in this Subsection, in
addition to all other rights and remedies provided by law or
equity, to which City may resort cumulatively or in the
alternative.
(1) Reentry without Termination. Citymayreenter the
Premises, and, without terminating this Lease, re -let all
or a portion of the Premises. City may execute any
leases made under this provision in City's name and
shall be entitled to all rents from the use, operation, or
occupancy of the Premises. Lessee shall nevertheless
pay to City on the dates specified in this Lease the
equivalent of all sums required of Lessee under this
Lease, plus City's expenses in conjunction with re-
letting, less the proceeds of any re -letting or attornment.
No act by or on behalf of City under this provision shall
constitute a Termination of this Lease unless City gives
Lessee specific notice of Termination.
(2) Termination. City may terminate this Lease by giving
Lessee notice of Termination. In the event City
terminates this Lease, City may recover possession of
the Premises (which Lessee shall surrender and vacate
upon demand) and remove all Persons and Premises.
City shall be entitled to recover the following as
damages:
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(i)
The value of any unpaid Rent or other charges
that are unpaid at the time of Termination;
(ii) The value of the Rent and other charges that
would have accrued after Termination less the
amount of Rent and charges the City received or
could have received through the exercise of
reasonable diligence as of the date of the award;
(iii) Any other amount necessary to reasonably
compensate City for the detriment proximately
caused by Lessee's failure to perform its
obligations under this Lease; and
(iv) At City's election,.such other amounts in addition
to or in lieu of the foregoing as may be permitted
from time -to -time by applicable California law.
City shall be entitled to interest at the rate of ten percent (10%)
per annum on all Rent and other charges from the date due or
the date they would have accrued. City shall also be entitled
to an award of the costs and expenses incurred by City in
maintaining or preserving the Premises after default,
preparing the Premises for re -letting, or repairing any damage
caused by the act or omission of Lessee.
(3) Use of Lessee's Personal Premises. City may use
Lessee's personal property and trade fixtures located on
the Premises without compensation or liability to
Lessee for use or damage. In the alternative City may
store the Premises and fixtures at the cost of Lessee.
City shall not operate the Premises in any manner
tending to indicate that the Premises is affiliated with,
part of or operated in conjunction with Lessee's
business.
(b) City's Right to Cure Lessee's Default. Upon continuance of
any material default beyond applicable notice and cure
periods, City may, but is not obligated to, cure the default at_
Lessee's cost. If City pays any money or performs any act
required of, but not paid or performed by, Lessee after notice,
the payment and/or the reasonable cost of performance shall
be due as additional Rent not later than five (5) days after
service of a written demand accompanied by supporting
documentation. No such payment or act shall constitute a
waiver of default or of any remedy for default or render City
liable for any Toss or damage resulting from performance.
(c) Waiver of Rights. Lessee waives any right of redemption or
relief from forfeiture under California Code of Civil. Procedure
Sections 1174 or 1179, or under any other present or future
law, in the event. Lessee is evicted or City takes possession of
the Premises by reason of any default by Lessee.
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17. CONDEMNATION
17.1 Termination of the Lease. Lessee or the City shall have the right to
terminate this Lease as of the date a public agency with lawful
authority to condemn obtains possession or title to ten percent
(10%), or more of the land area at the Premises, or the condemnation
materially affects the conduct of Lessee's business in the Premises,
or the Premises will no longer be suitable for the conduct of
Lessee's business for the Approved Use. In the event of Termination
pursuant to this Subsection, Base Rent shall be prorated to the date
of Termination, any unearned Rent shall be refunded to Lessee and
Lessee shall have no further obligations under this Lease. Lessee
shall not grant a right of entry to any potential condemner without
the written consent of City.
17.2 No Termination of Lease. If this Lease is not terminated under
Section 17.1, then this Lease shall terminate as to the portion of the
Premises taken upon the date that possession is taken, but this
Lease shall continue in force and effect as to the remainder of the
Premises. Lessee shall, in the event of a taking of any portion of the
Premises, be entitled to a reduction in the Base Rent in reasonable
proportion to the area of the Premises taken.
17.3 Allocation of Award. In the event that an award is made for an entire
or partial taking of the Premises pursuant to the power of eminent
domain, the award or compensation paid shall be as follows:
(a) City shall be entitled to that Portion of the award received for
the taking of the real property, the value of thisleasehold,
including all buildings and other improvements to which City
is entitled on Expiration or Termination of this Lease, and for
severance damages.
(b) Lessee shall be entitled to any award that may be made for the
taking of or injury to Lessee's business and profits, including
any amount attributable to Lessee's personal Premises,
fixtures, installations, or improvements in or on the Premises,
Lessee's relocation expenses, but excluding any "bonus
value" attributable to this Lease.
(c) Any interest payable on the total award shall be divided
between City and Lessee in the same ratio as the awards are
allocated pursuant to this Section.
18. SUBJECT TO STATE LANDS COMMISSION GRANT
The Premises are located on property that may, in whole or in part, be
subject of a grant from the State of Califomia to the City that is
administered by the State Lands Commission. Lessee shall not take any
action that would cause the City to be in violation of any provisions of that
grant. If the State Lands Commission or the State Legislature terminates
or modifies the tidelands grant or any related legislation in a manner that
prevents the Premises from being used for any Approved Use, this Lease
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shall terminate as a result and the Parties shall be released from all
liabilities and obligations under this Lease.
19. WASTE OR NUISANCE
Lessee shall not commit or permit the commission of any waste on the
Premises. Lessee shall not maintain, commit, or permit any nuisance as
defined in Section 3479 of the California Civil Code on the Premises.
Lessee shall not use or permit the use of the Premises for any unlawful
purpose.
20. PRIOR LESSEE USE AND HAZARDOUS MATERIALS
The Parties acknowledge that Lessee has been in possession of the
Premises pursuant to the provisions of a Lease since at least 1975. Lessee
represents and warrants that, to the best of Lessee's knowledge: (i)
Lessee's continued use of the Premises does not conflict with applicable
Laws; (ii) the Premises is not and has not been operated in violation of any
environmental laws, rules or regulations and Lessee's contemplated uses
will not cause any such violation; and (iii) the land underlying the Premises
is free of any and all Hazardous Materials as of the date of this Lease
caused by the Lessee. In the event that the presence of any Hazardous
Material caused by Lessee is detected in the land underlying the Premises
or the bay or any tidelands' areas adjacent to this Premises at any time
during the Term of this Lease and any Option Term all remedial or clean up
work shall be immediately performed by Lessee at Lessee's expense to
fully remediate such environmental condition so that the Premises and
such affected area(s) are promptly brought into full compliance with all
Laws. This clause and this lease does not restrict or limit Lessee's right to
lawfully use Hazardous Materials on the Premises, if in strict conformance
with all Laws.
21. CITY'S DEFAULTS/LESSEE'S REMEDIES
City shall be in Material Default if Lessee gives notice of nonperformance
specifying the nature of such default and/or City nonperformance and City
either does not cure such noticed item(s) within thirty (30) days or City
does not commence such cure performance within said thirty (30) days and
then diligently completes said cure to City's reasonable best efforts. In the
event of City's Material Default, Lessee may:
(a) Upon fifteen (15) days notice to City cure any such default by City
and City shall reimburse Lessee the amount of all costs and
expenses incurred by Lessee in curing the default, together with
interest and expenses at the maximum rate then allowed by law;
(b) Terminate this Lease if City's default materially interferes with
Lessee's use of the Premises for their intended purpose and City
fails to cure such default within fifteen (15) days after a second
demand by Lessee in which case Lessee shall have no further or
continuing obligations and City shall have no liability to Lessee; or
-25-
22. NOTICES
Any notice, demand, request, consent, approval or communication that
either Party desires or is required to give shall be in writing and shall be
deemed given three (3) days after deposit into the United States registered
mail, postage prepaid, by registered or certified mail, return receipt
requested or upon delivery if personally served or upon transmission if
sent by facsimile. Unless notice of a different address has been given in
accordance with this Section, all notices shall be addressed as follows:
If to City:
If to Lessee:
CITY OF NEWPORT BEACH
Attention: City Manager
3300 Newport Boulevard
Newport Beach, CA, 92658
AMERICAN LEGION POST 291
Attention: Commander
215 East 15th Street
Newport Beach, CA, 92660
23. SURRENDER OF PREMISES
At the Expiration or earlier Termination of this Lease, Lessee shall
surrender to City the possession of the Premises. Lessee shall leave the
surrendered Premises, required personal property and fixtures in good and
broom -clean condition, reasonable wear and tear excepted. All property
that Lessee is not required to surrender, but that Lessee does abandon
shall, at City's election, become City's property upon Expiration or
Termination.
24. WAIVER
The waiver by City or Lessee of any breach of this Lease by the other shall
not be deemed to be a waiver of any term, covenant, or condition or any
subsequent breach. The acceptance of Rent by City shall not be deemed a
waiver of any breach by Lessee other than the failure to pay the particular
rent accepted.
25. PARTIAL INVALIDITY
If any term or Provision of this Lease is declared invalid or unenforceable,
the remainder of this Lease shall not be affected.
26. GOVERNING LAW
This Lease shall be governed by the laws of the State of California. Neither
City's execution of this Lease nor any consent or approval given by City in
its capacity as City shall affect City's powers and duties as a governmental
body. Any consent or approval Lessee is required to obtain from City
pursuant to this Lease is in addition to any permits or approvals Lessee is
-26-
required to obtain pursuant to law or ordinance. However, City shall
attempt to coordinate its procedures for giving contractual and
governmental approvals so that Lessee's requests and applications are not
unreasonably denied or delayed.
27. ENTIRE AGREEMENT; MODIFICATION
This Lease contains the entire agreement between the Parties. No verbal
agreement or implied covenant shall be held to vary the provisions of this
Lease. Each Party has relied on its own inspection of the Premises and
examination of this Lease, the counsel of its own attomey or other
advisors, and has a complete understanding of the overall warranties,
representations, and covenants in this Lease. The failure or refusal of
either Party to inspect the Premises, to read this Lease or other
documents, or to obtain legal or other advice relevant to this transaction
shall not be the basis for later claim that all or part of this Lease is not
enforceable or was not understood by a Party when this Lease was signed.
No provision of this Lease may be amended or variedexcept by an
agreement in writing signed by the Parties or their respective Successors.
Upon execution of this Lease by both Parties, the previous lease will be
terminated and have no further force and effect.
28. TIME OF ESSENCE
Time is of the essence with respect to the performance of every Provision
of this Lease in which time of performance is a factor. All time deadlines
are meant to be strictly construed. A "day" means a calendar day, with
extension if a deadline occurs on a weekend or day when banks are not
open in Califomia.
29. SUCCESSORS
Subject to the Provisions of this Lease onassignment and subletting, each
and all of the covenants and conditions of this Lease shall be binding on
and shall inure to the benefit of the heirs, successors, executors,
administrators, assigns, and personal representatives of the respective
parties.
30. NO BROKERS
Each party warrants to and for the benefit of the other than it has had no
dealings with any real estate broker or other agent (attomeys excepted) in
connection with the negotiation or making of this Lease, and that no
commission, fee or other compensation is owed regarding this Lease by
such other Party.
-27-
31. GENDER; NUMBER
The neuter gender includes the feminine and masculine, the masculine
includes the feminine and neuter, and the feminine includes the neuter, and
each includes corporation, partnership, or other legal entity whenever the
context requires. The singular number includes the plural whenever the
context so requires.
32. EXHIBITS
All exhibits to which reference is made in this Lease are incorporated by
reference. Any reference to "this Lease" includes matters incorporated by
reference.
33. PROPRIETARY CAPACITY
The provisions of this Lease do not, and shall not be construed, to alter or
impair the rights and duties of City when acting in its capacity as a
govemmental entity. This Lease has been approved and executed by City
in its proprietary capacity as the owner/grantee of the Premises.
IN WITNESS WHEREOF, the parties have executed this Lease as of the date first
written above.
ATTEST:
La onne Harkless, City Clerk
APP -;• VED AS TO FORM:
obert H. Burnham, City Attorney
CITY OF NEWPORT BEACH, a
Municipal Corporation
By:
Tod W. Ridgewaayor
NEWPORT HARBOR POST NO. 291
OF THE AMERICAN LEGION,
a Cali nia Coraoratias("Lessee")
-28-
• •
EXHIBIT B
Legal Description:
That parcel of land in the City of Newport Beach, County of Orange, State of California,
being a portion of Lot 4, Section 33, and a portion of Lot 4, Section 34, Township 6
South, Range 10 West, San Bernardino Meridian, and those adjacent filled tidelands,
described as follows:
Beginning at a point on the northerly prolongation of the westerly line of 15th Street, as
shown on the map of Tract Number 234, recorded in Book 13, Pages 36 and 37 of
Miscellaneous Maps, in the office of the County Recorder of said County, said point
being 160.00 feet northerly from the northeasterly corner of Lot 4, Block 115 of said
Tract; thence North 9 degrees, 43 minutes, 30 seconds East along said northerly
prolongation 109.79 feet to the United States Government Bulkhead Line between
Station Number 118 and Station Number 119, as shown on the map entitled "Harbor
Lines — Newport Bay, Newport Beach, California", dated March 20, 1936, File Number
958, approved by the U.S. Secretary of War on May 2, 1936, a copy of which is on file in
the offices of the Coastal Projects Section, Engineering Division, U.S. Army Corps of
Engineers, Los Angeles District, 911 Wilshire Boulevard, Los Angeles, California,
90017-3401; thence North 80 degrees, 16 minutes, 30 seconds West along said Bulkhead
Line 349.90 feet to the northerly prolongation of the easterly line of Lot 13, Block 115 of
said Tract, thence South 9 degrees, 43 minutes, 30 seconds West 249.79 feet along said
northerly prolongation of the easterly line of Lot 13 to a line 20.00 feet northerly of and
parallel with the northerly line of said Block 115; thence South 80 degrees, 16 minutes,
30 seconds East along said parallel line 203.90 feet; thence North 9 degrees, 43 minutes,
30 seconds East 140.00 feet; thence South 80 degrees, 16 minutes, 30 seconds East
146.00 feet to the point of beginning.
RESERVING for street purposes a strip of land 50 feet wide, lying 25 feet on each side
of the following described centerline:
Beginning at a point on the northeasterly prolongation of said Lot 13 of Tract Number
234, said point being 135.00 feet northerly of the northeasterly corner of said Lot 13;
thence South 80 degrees, 16 minutes, 30 seconds East 203.90 feet along a line parallel
with said northerly line of Block 115 to a point being 146.00 feet westerly of said
prolongation of the westerly line of 15th Street.
• •
EXHIBIT D
Legal Description
That parcel of land in the City of Newport Beach, County of Orange, State of California,
being a portion of Lot 4, Section 33, Township 6 South, Range 10 West, San Bernardino
Meridian, and Block 117 as shown on the Map of Section B, Newport Beach,recorded in
Book 4, Page 27 of Miscellaneous Maps, in the office of the County recorder of said
County, and Block 116 as shown on the map of Tract Number 234, recorded in Book 13,
Pages 36 and 37 of Miscellaneous Maps, in the office of the County Recorder of said
County, and Lots 11, 12, and 13 of Block 115 of said Tract Number 234, and those
adjacent filled tidelands, described as follows:
Beginning at the southeasterly corner of Lot 11, Block 115 of said Tract Number 234,
thence North 9 degrees, 43 minutes, 30 seconds East along the easterly line of said Lot 11
100.00 feet to the northeasterly corner of said Lot 11; thence North 80 degrees, 16
minutes, 30 seconds West 20.00 feet along the northerly line of said Lot 11; thence North
9 degrees, 43 minutes, 30 seconds East 20.00 feet parallel with said easterly line of Lot
11; thence North 80 degrees, 16 minutes, 30 seconds West 38.73 feet parallel with the
northerly line of said Lot 11 to the northerly prolongation of the easterly line of Lot 13 of
said Tract Number 234; thence North 9 degrees, 43 minutes, 30 seconds East 249.79 feet
along said northerly prolongation to the United States Government Bulkhead Line
between Station Number 118 and Station Number 119, as. shown on the map entitled
"Harbor Lines — Newport Bay, Newport Beach, California", dated March 20, 1936, File
Number 958, approved by the U.S. Secretary of War on May 2, 1936, a copy of which is
on file in the offices of the Coastal Projects Section, Engineering Division, U.S. Army
Corps of Engineers, Los Angeles District, 911 Wilshire Boulevard, Los Angeles,
California, 90017-3401; thence North 80 degrees, 16 minutes, 30 seconds West along
said Bulkhead Line 930.00 feet to the northerly prolongation of the westerly line of Lot
16 of said Block 117; thence South 9 degrees, 43 minutes, 30 seconds West 369.79 feet
to the southwesterly corner of said Lot 16; thence South 80 degrees, 16 minutes, 30
seconds East 988.73 feet along the southerly line of said Block 117 of Section B and
along the southerly line of said Blocks 116 and 115 of Tract Number 234 to the point of
beginning.
lb
2nd LEASE AMENDMENT
to the 1975 Lease between the City of Newport Beach
and the American Legion Post 291 (Newport Harbor)
This Second Lease Amendment, made and entered into this 24th day of
October, 2000, by and between the City of Newport Beach, a chartered
municipal corporation ("CITY") and Newport Harbor Post 291 of the American
Legion ("LEGION") is as follows:
WHEREAS, Legion has operated a marina and clubhouse at 215 15th
Street in Newport Beach since September 1940 and
WHEREAS, City owns or holds in trust the property associated with the
clubhouse and marina and has leased the premises to Legion under a lease
executed March 10,1975 ("1975 Lease") and
WHEREAS, the 1975 Lease was to expire on March 15, 2000 but was
extended to March 15, 2001 ("First Lease Amendment"); and
WHEREAS, City and Legion desire to match the Legion's Lease with the
term of the Marinapark Lease Extension, which allows Marinapark residents to
remain at Marinapark to March 15, 2002;
NOW, THEREFORE, IN CONSIDERATION OF THE FOREGOING
RECITALS AND THE MUTUAL COVENANTS set forth below, City and
Legion hereby agree to execute the 2nd Lease Amendment to the 1975 Lease (as
amended by the First Lease Amendment) as follows:
II. TERM
... The term of this lease will commence on March 15, 1975 and expire on
March 15, 2002.
IN WITNESS THEREOF, the parties hereto have executed this 2nd Lease
Amendment as of the day and year first above written.
ATTEST:
LaVonne Harkless, City Clerk
CITY OF NEWPORT BEACH
1
AMERICAN LEGION POST 291
Dennis Lahey, Commander
• •
Attachment A
Pt LEASE AMENDMENT
to the 1975 Lease between the City of Newport Beach
and the American Legion Post 291 (Newport Harbor)
This First Lease Amendment, made and entered into this 2 Z. day of
August, 2000, by and between the City of Newport Beach, a chartered
municipal corporation ("CITY") and Newport Harbor Post 291 of the American
Legion ("LEGION") is as follows:
WHEREAS, Legion has operated a marina and clubhouse at 215 15th
Street in Newport Beach since September 1940 and
WHEREAS, City owns or holds in trust the property associated with the
clubhouse and marina and has leased the premises to Legion under a lease
executed March 10,1975 ("1975 Lease") and
WHEREAS, the 1975 Lease expired on March 15, 2000; and
WHEREAS, City and Legion desire to extend the 1975 Lease under
identical terms for the period of one (1) year from the March 15, 2000 lease
expiration date and
WHEREAS, this one (1) year extension shall cause the 1975 Lease to
expire on March 15, 2001.
NOW, THEREFORE, IN CONSIDERATION OF THE FOREGOING
RECITALS AND THE MUTUAL COVENANTS set forth below, City and
Legion hereby agree to execute the First Amendment to the 1975 Lease (Exhibit
A) as follows:
II. TERM
... The term of this lease will commence on March 15, 1975 and expire on
March 15, 2000 2001.
IN WITNESS THEREOF, the parties hereto have executed this Lease
Amendment as of the day and year first above written.
Page 4
LaVorme Harkless, City Clerk
CITY OF NEWPORT BEACH
oyes/ a rr
AMERICAN LEGION POST 291
Dennis L. ey, Comman er
a
CITY OF NEWPORT BEACH
Office of City Manager
(714) 644-3002
October 5, 1994
Mr. Don Donaldson
Lease Committee Member
Newport Harbor American Legion Post 291
215 15th Street
Newport Beach, CA 92663
Subject: Lease of American Legion Property
Dear Mr. Donaldson:
This is in response to your letter of September 30, 1994. Regarding your
specific question, I am unsure about the sequence of your request and the
Marina Park request. However, until the disposition of the larger property
(Marina Park) is determined, it would be difficult to determine the disposition of
your smaller property.
Though separate now, the two properties are best considered together when
assessing their potential as a revenue source to the City. Since the initial
request for a renogotiation of the lease, the City's financial situation has
declined precipitously and the importance of income producing property has
become paramount. Attached is a copy of the City Income Property Policy
setting forth the philosophy governing lease renewals. The American Legion
leasehold is an integral part of the total City -owned parcel when considering
potential income. Thus the City cannot enter negotiations on the Legion's lease
until Marina Park's lease is settled.
In the way of a progress report, it appears the Marina Park lease will notbe
renogotiated until the existing lease nears it expiration. In the meantime, in
accordance with the City Council Policy, the City will be investigating all
alternatives for the entire bay front property.
City Hall • 3300 Newport Boulevard • P.O. Box 1768 • Newport Beach, California 92659-1768
Page 2
A City Council Income Property Committee which reviews these items now
consists of Mayor Turner, Councilmember Sansone and Councilmember Cox.
Messrs. Turner and Sansone will leave the Council next month and a new
Committee will be appointed. Staff intends to brief the new Committee on these
and other matters when they first convene at the beginning of next year. At that
time I will have a better indication of the time frame and other considerations
regarding the disposition of the leasehold now occupied by the American
Legion.
If you have any specific questions please feel free to contact me directly.
S cerely,
Kenneth J. - no
Assistant City Manager
KJD:mb
F-7
INCOME PROPERTY
The City owns and manages an extensive and valuable assortment of property
including streets, parks, beaches, public buildings and service facilities. The
City also owns and operates a yacht basin, a mobile home park, a luxury
residential development and various other income properties. Most of the
income property is tidelands, filled tidelands or waterfront. Unencumbered fee
value of income property is estimated at upwards of one hundred million
dollars, and income typically contributes ten percent of all City revenues.
As owner of property, the City is the steward of a public trust, and state law
requires the City to maximize its returns or be subject to a charge of making a
gift of public funds. Nevertheless, the City Council recognizes the importance of
this property not only as a revenue generator, but also as a means to provide
otherwise unfeasible uses and facilities to benefit the community.
In managing its property, the City will continually evaluate the potential of all
City owned property to produce revenue. This may include leasing unused
land, renting vacant space, establishing concessions in recreation areas or other
similar techniques. The City Council will evaluate the appropriateness of
establishing new income properties using sound business principals and after
receiving input from neighbors and users.
The policy of the City Council is that income property be managed in accordance
with the following:
1. Whenever a lease, management contract, concession, sale or similar action
regarding income property is considered by the City, an analysis shall be
conducted to determine the maximum or open market value of the
property. This analysis shall be conducted using appraisals or other
techniques to determine the highest and best use of the property and the
highest value of the property.
2 All negotiations regarding the lease, management contract, concession,
sale or similar action regarding income property shall include review of
an appraisal or analysis of the use being considered for the property
conducted by a reputable and independent professional appraiser, real
estate consultant or business consultant
3. The City shall seek, whenever practical and financially advantageous, to
operate or manage all property and facilities directly with City staff or
contractors.
• •
F-7
7. All negotiations regarding the lease, management contract, concession,
sale or similar action regarding income property shall be conducted by
the City Manager or his designee under the direction of the City Council
Ad Hoc Income Property Committee or other appropriate committees
prior to consideration by the City Council.
Adopted - July 27,1992
Amended - January 24,1994
Formerly F-24
3
Newport
American Legion I'o>gt-1\%. 291
215 15th Street
Newport Beach, California
673-5070
September 30, 1994
Kenneth J. Delino
Assistant City Manager
City of Newport Beach
3300 Newport Boulevard
Newport Beach, California 92663
Subject: Lease of American Legion Property
Dear Ken:
On August 21, 1992, your letter stated when the City
concludes negotiations with Beacon Bay the investigation of
the American Legion lease would begin.
The next letter we received, on November 9, 1994, addressed
to John McDaniel, stated negotiations on the Legion Hall
will commence upon completion of the Marina Park lease.
The American Legion request for extension of their lease was
submitted some four weeks before the Marina Park request.
Our question now is, how did we get moved back of Marina
Park? Our membership has been asking!
Could you help us out by giving us the answer,and the
approximate date we may expect to negotiate?
Sincerely,
Don Donaldson
Lease Committee -Member
w
•
•
•
February 10,1993
CITY OF NEWPORT BEACH
(714) 644-3000
Mr. John K. McDaniel, Secretary
Newport Harbor American Legion Post No. 291
215 15th Street
Newport Beach, CA 92660
Dear Mr. McDaniel:
Recently I received your letter regarding the charging of a $250 fee for the use of
the American Legion Post for civic organizations use of your facility. After
receiving your request I have reviewed it with our City Attorney and have
concluded that the fee is appropriate and may be instituted to offset your costs at
the Legion Post.
If you have any questions on the above action please contact my office.
Sincerely,
Kevin J. Murphy
City Manager
cc: Saty Attorney
Deputy City Manager
City Hall • 3300 Newport Boulevard • P.O. Box 1768 • Newport Beach, California 92659-1768
anuary 22, 1983
•
Newport Harbor
American Legion Post No. 201
215 15th Street
Newport Broth, California
673-5070
Kevin Murphy
City Manager
P.O. Box 1760
Newport Beach, CA 82658-1788
Dear Mr. Murphy:
1 am in receipt of correspondence dated January 18, 1993, from
Kenneth Delino advising American Legion Post 281 that Your
approval must be obtained for the Legion to charge the minimum
fee of $250.00 anytime one of the oivio organisations reserve the
Legion Hall.
As 1 explained to Mr. Delino by telephone, our new corporate
board hasaanaIyzed our basic costs and find they are a minimum of
$250.00 These costs include the obvious:overhead• expenses of
inuuranoe, taxes, utilities, etc., plus labor expense for setting
up the hall, clean up and general maintenance. In addition, the
Legion furnishes table cloths for each event, for which we pay a
fee to an outside service.
We have also instituted a requirement that, for all community
organizations to secure their desired date, the $250.00 fee must
be paid at the time the contract is written. This fee is
refundable if the event is canceled no less than ninety (80) days
prior to the agreed upon date. I am certain the necessity of
this requirement is obvious to you. We have reservations booked
from six to twelve months in advance. In the event of a late
cancellation, we would be precluded from renting the Hall.
Amerioan Legion polioy has been, and will continue to be, to
support all community and civic organizations. The only thing
which has changed is that the Post is no longer able to donate
the above mentioned expenses.
If I may be of any further assistance, please contact me. Or,
come to the Post and visit us.
Very trtly yours,
K. McDaniel
oretary cc:Kenneth Delino
Ron Whitley, PB&R
cuncilmember E. HART 7146454571 P.01
AMERICAN GION POST 291 AUDIT C 14MITTEE REPORT
TO: POST COMMANDER ROGER REIMER
PURPOSE::
The Post 291 Audit Committee reviewed the condition of the current
accounting system to determine if the Financial Statements accurately
report the Assets, Liabilities, and Net Profit (or Loss) of Newport
Harbor Post 291, Inc. of the American Legion. Our examination was made
to determine if the system was creating accurate Financial Statements
rather than to verify the dollar amounts on th 4ancial Statements.
The Committee examined Corporate Board mee es, a cross-section
of income and expense records, review nMarina lease, and
interviewed the outside accountjnn ;c'e
FINDINGS:: `-
• x>
The records are so poorly ke at the Corporation's office help
was at no time able to provide us with all of the records we requested.
The 1991 Financial Statements contain gross errors and misstatements.
There were transactions that are illegal without the approval of the
Corporate Board and the Board's minutes do not reflect any such action.
One of these transactions was a $ 10,000 bank loan; another was opening
a Petty Cash checking account which only requires one signature instead
of the two signatures required by our By -Laws. Board minutes reflect
that these items were not brought before the Board for its approval.
The Marina Lease has been rewritten recently and now contains at
least a dozen typographical errors. The Marina income records show
that a number of renters have not been charged late fees, as required
by the Lease, and several renters are months in arrears with no action
having been taken against them.
We interviewed the owner of the accounting service and discussed
the errors in the Financial Statements he had prepared. His defense
for not correcting errors that he noticed was that he "did not think
that anybody cared".
While bar income dropped $ 3,000 in 1991, bar purchases have gone
up by $ 12,000. This fact was concealed in the Financial Statements
until after a physical inventory was ordered taken by the Audit
Committee. The numbers indicate either management incompetence,
misappropriation of funds, or both. Also, the premise for having a
large amount of cash on hand ($ 4,000) was so that an employee would
not have to come in on week -ends to handl e.bar cash, but the
payroll records indicate otherwise.Corked on weekends.
RECOMMENDATIONS::
. \-\
Instruct the Chairman and members.. the Corporate Hoard to keep
accurate minutes and to not violate the By -Laws. Close the Petty Cash
Checking Account and return the funds to the general account. The
By -Laws prohibit Corporate employees from being officers of the Post,
Auxiliary, S.A.L.s, Yacht Club, etc. Instruct the Corporate employees
that the A.L.Y.C. is not to be run out of the Corporation's office by
Corporate employees.
uncilmember E. HART 7146454571
•
AMERICAN
P. 62
Instruct the Corporate Board to rewrite the Marina Lease without
the typographical errors and have it reviewed by an attorney before
using it. Instruct the Corporate Board to bill ALL Marina renters for
late charges when their full payment has not been received by the end
of the ten day grace period. Instruct the Corporate Board (supervised
by the outside accountant) to serve notice to ALL delinquent Marina
renters that they have thirty (30) days to pay their outstanding
balances and file liens against any boats that are of brought current
within that time. Turn the Marina billing over he outside
accountant. Also, as the Marina operatio 4,842 in 1991 an
IMMEDIATE rate increase is needed (per.elaV n analysis).
Errors in the Financial Statements tarestau &knd prove that the
record -keeping system needs updating._ hsttuc the Corporate Board to
contract with a more conscientious adcount4iflervice to update the
accounting system. Office employees=will-not decide which records will
be kept or when, where, and how they will be kept.
Instruct the Corporate Board to hire an experienced facilities
manager. This action was supposed to have been done over a year ago
(it was a mandate passed on the floor). Instruct the Corporate Board,
or new manager, to take monthly bar inventories and take the steps
necessary to re-establish employee integrity. Program the bar cash
registers to show income we are making on lunch sales. Sell the
cellular telephone at market value. Give the bar manager authority.
Collect the sales tax owed by the Fish Fry and Steak Fry and
require that they make proper reports to the Corporation accompanied
with payment of sales tax that they have collected during that period.
The present operation is in violation of California laws regarding the
collection and payment of sales tax, for wh the American Legion Post
is responsible and directly liable. Sa •eing is collected but,
as of this date none has been turne, • Corporation.
CONCLUSION: W
Our Corporation handlesC It-'0,000 a year and it is time to
develop a responsible organiz t °� to prevent this money from being
wasted. The Corporation needs develop a formal Business Plan, to
define the jobs and responsibilities of all officers and employees, to
write (and follow) procedures for daily operations, and to set up and
KEEP WITHIN a balanced budget. The Post Audit Committee should audit
the Corporation's operation on a quarterly audit basis with non -Board
members only on the Committee. We recommend the Committee rotate one
member each quarter with the rest staying on for continuity.
Respectfully submitted,
Jack Shafer
Nita Ullman
Walt Wagner, Chairman
Art Beauregard
D. W. Woollett
c.c.: Corporate Board President Dick Porch
touncilmember E. HART .6454571
NEWPORT HARBOR POST 291, IFC. OF THE AMERICAN LEGION
P.03
FINANCIAL STATEMENT DATA COMPARISON
1986 through 1991
ITEM 12/86 12/87 12/88 12/89 12/90 12/91
ASSETS:
Cash on Hand 2,698 2,657 3,320
Cash In Checking 23,501 18,111 24,859
Cash In savings 66,016 60,812 53,773
TOTAL CASH
Inventory
Net Fixed Assets
2,232
24,238
66,325
3,657
30,101
66,269
4,108
927
61,056
92,215
5,210
26,961
92,795
3,280
31,535
HALL INCOME:
Hall Rentals
Donations/Cards
Bar Sales
Cost of Sales
Bar Payroll
Hall R & M
Hall Refunds
Bar Overhead
Bar Profit/<Loss>
24,274
120
100,425
26,040
10,183
131,940
81,580
6,470
32,363
81,952 100,027
4,391 8,451
28,170 30,677
66,091
6,211
40,535
=s=
26,693 41,964 50,809 50,775
13,248 7,473 8,060 16,983
152,267 179,178 191,381 188,047
33,785 44,324 54,393 65,839 65,779 72,782
22,810 45,407 49,247 50,723 60,100 61,439
12,052 9,933 17,691 26,525 15,938 12,479
Incl. Inca. Incl. Incl. 8,801 20,629
52,810 58,731 63,302 96,710 82,105 84,484
3,362
C.O.S./Sales
33.64%
9,768
7,575 (11,182) 17,527
3,992
33.59%
35.72% 36.75% 34.37%
38.70%
MARINA INCOME:
Marina
Dry Storage
Lockers
Interest
Misc.
Payroll, Off.
Payroll, Maint.
Rent
Marina R & M
Marina Overhead
Mar. Profit/<Loss>
144,539
26,039
2,980
5,988
7
46,348
65,538
10,060
61,204
156,343
29,227
2,835
6,753
581
45,980
83,215
2,036
71,474
151,361
31,867
2,880
5,649
2,012
41,738
78,967
5,685
66,047
151,284
34,617
3,230
4,842
2,052
13,978
12,967
74,861
9,100
70,955
150,601
37,958
3,270
5,047
6,046
27,141
17,416
79,441
22,273
63,443
153,218
35,606
3,200
3,786
4,895
31,131
36,471
82,949
17,837
67,159
(3,597)
(6,966)
1,332 14,164 (6,792)
(34,842)
TOTAL PROFIT/GLOSS
ssF
(235) 2,802
8,907 2,982 10,735 (30,850)
.uncilmember E. HART 4,6454571 P.04
(SL:F PLAN THE CITY HAS)
The west end slip of the American Legion Marina 30' and 6a nct
exceed 6' in length slips.
There is approximately 70' of space taken by American Legion
Yacht Club.
Slip #1 tor l8 years had a 36' boat in a :30' siip.
Slip 01 $33:3.00
y slips 5' S200.00
Total $ 5 33 . 00
ALYG
Total
per month
per month
gross revenue from Slip #1
$533 per month
40 mos. possession
$21,320 x 40% to the City
$21,320 x 60% to the AL
$5,525.00
= $12,292
Further the access to the hoist is bad at low tide and at high
tide as returning sail boats run with boom extended on the port
side. Suggest provide S slips as originally planned.
The slip rent has been increased $1.00 in seven years. This has.
put the American Legion Marina the lowest in Newport by two to
three dollars per foot.
i strongly suggest a token increase by seventy five cents (3
.75) per foot on wet slips and an increase in the dry storage
area of fifty cents ($ .50. per foot on dry storage. Dinghy
racks increase $5.00 and lockers increased $5.00 per month.
It is a must that you keep skits from the hoist area. The
biggest complaint from renters is the space is crowded, you can't
walk between the boats. Also the dock area to the first piling
is for sail boat to make ready to sail. This is for the renters,
not for mooring skifs in that water way. A daily count has been
taken and the same 5 or 6 skits are there. They are not paying
for water storage. THESE POINTS SHOULD BE ADDRESSED NOW.
Don Donaldson, Chairman Lease Committee
cc: Dick Porch
Bill von Esch
Red Dwyer
Howard Holden
Frank Kaiser
Lowell O'Brien
Roger Reimer
•
CITY OF NEWPORT BEACH
Office of City Manager
(714) 644-3002
January 18, 1993
Mr. John K. McDaniel, II
Secretary
American Legion Hall
Post 291 Incorporated
215 15th Street ,
Newport Beach, CA 92663
Dear Mr: McDaniel:
I recently reviewed your letter to Dorothy Palen dated January 8, 1993 regarding a
$250 fee for use of the Legion Hall. The Legion'slease with the City regarding the
subject reads as follows:
IV. USE AS A COMMUNITY CENTER BY OTHER ORGANIZATIONS
"When the demised premises and buildings are not in use by the
lessee, the premises and buildings shall be available for the use
as a community center and recreation instruction facility by the City
Parks, Beaches and Recreation Department on a first priority
basis, and by local organized community, civic related
organizations in accordance with reasonable rules, regulations,
fees and scheduling to be established by lessee with the approval
of the City Manager." (emphasis added)
From your letter, it appears that the Legion is, now imposing fees for use of the
facilities. However, I am unable to find any record of the City Manager approving rules
and regulations as required by the lease. Accordingly, I must ask that you submit a
copy of your rules and regulations for use of the building by civic organizations to the
City Manager for his approval.
Please call me if you have any questions.
Sincerely,
Kenneth J. Deli
KJD:mb Deputy City Manager
cc: City Manager
PB&R Director
City Hall • 3300 Newport Boulevard • P.O. Box 1768 • Newport Beach, California 92659-1768
CITY OF NEWPORT BEACH
OFFICE OF THE CITY MANAGER
JANUARY 18, 1993
TO: ALL DEPARTMENT DIRECTORS
FROM: DEPUTY CITY MANAGER
SUBJECT: LEGION HALL FEES
Recently the Legion Hall instituted a $250 fee for use of their facilities.
According to their lease with the City, such fee requires approval by the City
Manager. Inasmuch as they have not yet submitted their rules to the City
Manager for his approval, this fee is not yet permissible under their lease. I
have asked the Legion to submit their rules for approval, and until such time as
the City Manager approves them, no department should pay any fee for use of
the Legion Hall.
Kenneth J. Deli
KJD:mb
cc: City Manager
Newport Harbor
American Legion Post No. 291
215 15th Street
Newport Beach, California
673-5070
January 8, 1993
Dorothy Palen
3300 Newport Blvd.
Newport Beach, CA 92663
Dear Dorothy:
Nice talking with you today. I have enclosed a
copy of our standard contract which should be completed on
any future use of the hall.
Dorothy, we have always tried to accommodate the
city and other civic groups at a fair and reasonable price
to help them support their functions. However, due to the
hard economic times we must cover our basic costs. After an
end of the year audit, we find our break even is OW This
will be your charge in the future. At the time the hall is
reserved, this amount along with the contract reserving the
hall must be submitted. one other restriction, if there is a
cancellation of your reserved date 90 days or before, the
full $250 will be refunded. cancellations less than 90 days
will be non refundable. This we have to do because most of
our bookings are 6 months to one year in advance and the
hall would go unused for that evening.
If there there are any further questions please
call Sally Chapman, Office Manager at 673-5070.
Looking forward to working with you in the future.
erely,
/ John K. Mc Daniel, II
[/� Secretary, American Legion
Post 291, Inc.
cc: Kevin Murphy, City Manager
All Department Directors
•
MEMORANDUM
OFFICE OF THE CITY ATTORNEY
June 20, 1988
TO: Robert Wynn, City Manager
FROM: Robert H. Burnham, City Attorney
RE: Proposed Expansion of American Legion Lease
I have reviewed the map that accompanies your June 17, 1988 Memo
and, in my opinion, the area outlined in green is not "water -front
or beach property." The parcel outlined in green is one lot
removed from the water front, does not look or function like a
beach, and is fenced off from the parcel currently leased to the
American Legion. The use of the property as a lawn bowling
facility suggests that the community did not consider the property
useful for beach- or water -related purposes.
According to Ron Whitley, the property in question was used as a
lawn bowling facility for a long time prior to relocation of the
green to San Joaquin and Crown Drive. If the property was under
lease to the Lawn Bowling Club prior to January 11, 1957 there are
no restrictions on the right of the City to lease or release the
property.
Please call if you have any questions
obert H. Burnham
City Attorney
RHB/jc
Attachment
•
CITY OF NEWPORT BEACH
OFFICE OF THE CITY MANAGER
June 17, 1988
TO: CITY ATTORNEY
FROM: City Manager
SUBJECT: EXPANSION OF AMERICAN LEGION LEASE
ni11:2jirrairl
011
{+EWPORT BEACH.
CALIF.
Attached is a map showing the current American Legion lease
area outlined in yellow. The American Legion now wishes to expand their
lease area to the area outlined in green on the attached plot map. This
green area was the former lawn bowling green prior to the time that it
moved to San Joaquin and Crown Drive. Currently the area shown in green
is just a grassy regionwith some picnic area in the Southwest corner.
I need an opinion as to whether the expansion of the lease
would be permitted under Section 1402 of the City Charter. 1402 prohibits
leasing land that is classified waterfront or beach property. 'Is this
property close enough to the beach to be classified waterfront or beach
property in your opinion?
I will meet again with the American Legion in about two weeks.
If I could have your opinion prior to meeting, it would be helpful.
FL.OBtl
ERT L.
RLW:kf
Enclosure
LEASE
THIS LEASE, made and entered into this /O rA, day
naReAi
, 1975, by and between the CITY OF NEWPORT
BEACH,a chartered municipal corporation, hereinafter referred to
as "Lessor", and NEWPORT HARBOR POST NO. 291 OF THE AMERICAN LEGION,
a California corporation, hereinafter referred to as "Lessee":
RECITAL S:
A. Lessor holds title to certain harbor frontage and
tidelands, together with certain uplands abutting thereon located
at 15th Stzeet and West Bay, City of Newport Beach, County of Orange,
State of California, hereinafter more particularly described.
B. "Lessee has constructed substantial improvements upon
the property consisting of certain buildings, boat anchorages,
moorings, slips, docks, ramps, launching facilities, parking lot,
and dry boat storage which Lessee presently operates and maintains
pursuant to a lease between Lessor and Lessee dated February 26, 1951.
The term of the existing lease expires on January 31, 1976. Lessee
has requested Lessor to extend the term of.the lease for an additional
twenty-five (25) years.
C. It is the judgment of the City Council of the City of
Newport Beach that the uplands cannot be used without the tidelands,
nor can said tidelands be used without the uplands abutting thereon;
and it is further the judgment of Lessor that the leasing of the
whole of said lands hereinafter described as one parcel is necessary
for the proper development and use of said lands, water frontage
and tidelands for recreational, public, civic, beaches, commerce,
navigation and fishery purposes.
D. It is the judgment of the City Council of the City of
Newport Beach that the leasing of said lands to Lessee, upon the
conditions in this agreement specified, is not inconsistent with
,the trust imposed • such por a on of tX •.reinafter
described, which may constitute tidelands, an .t is further the
judgment of the City Council of the City of Newport Beach that the
leasing of said uplands as hereinafter described upon the conditions
in this agreement specified, is for a public purpose and does not
violate the Constitution of the State of California and is permis-
sible under State law.
E. Lessor proposes to lease to Lessee the premises
described hereinafter, and Lessee is willing to accept said lease on
the terms and conditions hereinafter set forth. This lease does
not violate Section 1402 of the Newport Beach City Charter in that
this lease constitutes a releasing of property under lease at the
effective date of said Charter.
NOW,THEREFORE, IN CONSIDERATION OF THE FOREGOING RECITALS
AND THE MUTUAL COVENANTS set forth below, Lessor and Lesseehereby
agree as follows:
I. DESCRIPTION OF LEASED PREMISES
Lessor hereby leases, and Lessee does hereby accept a
lease of the property, buildings and related parking and boat
facilities located at 15th Street and West Bay, as more particularly
described in Exhibit "A", which is attached hereto and made a part
herein by this reference.
II.. TERM
In order to comply with Section 420 of the Newport Beach
City Charter which restrictstheleasing of property for a period
of more than twenty-five (25) years without prior voter approval,
the existing lease between Lessor and Lessee dated February:26, 1951,
may be extended for a period of twenty-four (24) years and two (2)
months, which would constitute a total period of twenty-five (25)
years from the expiration date of the existing lease, to wit, •
January 31, 1976. The term of this lease will commence on March 15,
1975, and expire on March15,2000.
III. USE
Lessee shall use the demised premises, together with the
buildings, parking and boat and marine facilities located thereon
-2-
for the purposes of managing, operating and conducting the activi-
ties of the American Legion. In and as a part of its duties in
managing and operating said American Legion Post, Lessee shall
not discriminate as to race, color, creed or the civil rights and
liberties of individuals subject to the normal rules and operating
procedures of the American Legion. Lessor retains the right to
locate an Acquatic Center in the area formerly used by the
Newport Harbor Lawn Bowling Association, as more accurately
depicted on Exhibit "B" attached hereto and made a part herein
by this reference. Lessee covenants and agrees to permit Lessor
to use its boat launching...facilities in connection with said
Acquatic Center.
IV. USE AS A COMMUNITY CENTER BY OTHER ORGANIZATIONS
When the demised premises and buildings are not in use
by the Lessee, the premises and buildings shall be available for
the use as a community center and recreation instruction. facility
by the City Parks, Beaches and Recreation Department on a first -
priority basis, and .by local organized community, civic related
organizations in accordance with reasonable rules, regulations,
fees and scheduling to be established by Lessee with the approval
of the City Manager.
V. . TYPE OF BUSINESS ACTIVITY
Lessee shall not grant any concession, license, permit
or privilege for the conduct of. any business or other operation
for profit or alter the use or type of service on the demised
premises without the prior approval of the City Manager.
VII. TAXES AND UTILITIES
Lessee shall promptly pay for all utility services
furnished to it and shall pay before delinquent any general and
special taxes or assessments or other governmental charges, if
any, which may be levied on the demised premises or furnishings
therein, or improvements thereon, or any possessory interest therein
arising out of or based upon the leasehold interest throughout the
term hereof, or may be imposed upon Lessee as a.result of its
operations under the lease. Satisfactory evidence of such payments
shall be delivered to Lessor upon demand therefor.
VIII. MAINTENANCE OF LANDSCAPING AND IMPROVEMENTS
Lessee coven,.:nts and agrees that during the term of
this lease it will, at its own cost and expense, maintain the
grounds, landscaping, and all buildings,, and any other improve-
ments of any kind in existenceor nature constructed or installed
on the demised premises by the Lessee, ata high standard of
maintenance and repair. Maintenance shall include painting of all
buildings and boat facilities. If in the judgment of the Lessor,
such standards of maintenance and repair are not being maintained,
Lessor may at its option, after written notice thereof to the
Lessee and Lessee's failure to commence in good faith to remedy
the same within the time herein provided and thereafter diligently
prosecute thesame to completion, elect to correct any deficiency,
whether it be in reference to grounds, landscaping, buildings or
improvements. Lessee covenants and agrees to pay to the Lessor
on demand any and all sums expended by it in correcting any such
deficiency. If, in the judgment of the Lessor, the disrepair or
lack of maintenance constitutes an emergency, the notice herein
provided shall be a 24-hour notice to'remedy; in all other cases
it shall be a 5-day notice.
-4-
• •
IX. INSURANCE - HOLD HARMLESS
Lessee shall save and keep Lessor, its officers, agents
and employees free and harmless from any and all claims or demands
of any name or nature whatsoever arising out of, or incident to,
the use and occupancy of the premises herein described by Lessee.
In partial performance of this obligation by Lessee, Lessee shall
procure and at all times during the term of this Lease maintain in
full force and effect a policy, or policies, of public liability
and property damage insurance protecting the City of Newport Beach,
its officers, agents and employees from all claims or demands for
damages. The policy, or policies, shall provide for not less than
Two Hundred Thousand Dollars ($200,000.00) for injury or death of
one person; Five Hundred Thousand Dollars ($500,000.00) for injury
or death of .two or more persons; and Fifty Thousand Dollars
($50,000.00) for damages to property. The City Manager may require
an increase in the amount of insurance from time to time in
accordance with changes in economic conditions. Attached to said
policy shall be an endorsement which shall provide as follows:
"Withinthe limits set forth in this policy,
to indemnify and save the City:of Newport Beach, its
officers, agents and employees, free and harmless from
all damage, claim, loss or liability of any name or
nature whatsoever which the City:of Newport Beach, its
officers, agents or employees may hereafter sustain or
incur, or maybe imposed upon them, arising out of, or
in any way connected with, the use or occupancy by the
insured, its servants, agents,and.employees, of the
premises described in a lease granted to insured by the
City of Newport Beach."
Lessee shall furnish, and maintain with the Lessor, either
the original policy, or policies, or a certified copy, or copies,
thereof. The policy, or policies, shall be approved as to sufficiency
by the City Manager and as to form by the City Attorney.
X. LESSOR'S RIGHT OF INSPECTION
Lessor reserves the right by its authorized agents,
employees or representatives to enter the leased premises to inspect`
the same or any nZ L.nereof at any atten4 to or
' protect the Lessor `s interest under ths. ase.
XI. COMPLIANCE WITH LAWS
Lessee covenants and agrees to comply with all rules,
regulations, statutes, ordinances and laws of the State of California,
County of Orange,. the City of Newport Beach or any other governmental
body or agency having lawful jursidiction over the leased premises
or the business, enterprises or activities conducted thereon.
XII. ASSIGNMENT
Except as provided in paragraph IV hereinabove, Lessee
shall not assign, transfer, sublease or give any grant of control
of this lease or demised premses, or any part thereof, either
voluntarily or involuntarily, unless first approved by the City
Council.
XIII. 'NON-COMPLIANCE
If the Lessee. fails to comply with any of the terms and
conditions of this Lease,. the Lessor may give to the Lessee a
notice in writing of such failure and specify therein the particu-
lars in which Lessee has.failed:to comply with the provisions of
this Lease. If the Lessee fails for a period of thirty (30) days
after the giving of such notice to comply with the provisions of
this Lease, the Lessor may; at its option,terminate this Lease,
and all rights of the Lessee therein shall cease and terminate and
the Lessee shall immediately thereafter deliver possession of the
premises to the Lessor.
XIV. SURRENDER OF PREMISES UPON EXPIRATION OR
TERMINATION
Upon the expiration of the term of this lease or
sooner termination thereof as herein provided,. Lessee shall deliver
possession of said demised premises to Lessor in the same condition
as delivered to Lessee, reasonable wear and tear excepted, and
also excepting any changes or alterations authorized or approved
in writing by the City Manager or City Council. Upon the expiration
or termination of this lease, any additions or improvements made
upon the demised premises shall become the property of the Lessor.
XV. DEFAULT AND TERMINATION OF LEASE
A. Default
Time and each of the terms, covenants and
conditions hereof are expressly made the essence of this Lease.
If the Lessee shall fail to comply with any of
the terms, covenants, or conditions of this Lease, including the
payment of rental herein reserved, at the time and in the amount
herein required, and shall fail to remedy such default within
thirty (30) days after service of a written notice from Lessor so
to do if the default may be cured by the payment of money, or to
commence in good faith to remedy any other default within thirty
(30) days and thereafter diligently prosecute the same to completion,
or if Lessee shall abandon or vacate the leased premises, Lessor
may, at its option, and without further notice or demand, terminate
this Lease and enter upon the leased premises and take possession
thereof, and remove any and all persons therefrom with or without
process of law.
B. Surrender of Possession Upon Termination
Lessee covenants and agrees that upon the
expiration or sooner termination of this Lease, the Lessee will
peaceably surrender the leased premises with all buildings and
improvements, in the same condition as when received or constructed,
reasonable use and wear thereof, and damage by fire, Act of God,
or by the elements excepted. Lessee expressly waives any 'right
which it may have to relocation assistance or costs in vacating
the demised premises. Any improvements built, constructed or
placed upon the leased premises by the Lessee, or anyone holding
by, under, or through it, shall remain on the leased premises and
become the property, of the Lessor without any cost to Lessor upon
the termination of this Lease, whether by lapse of time or by
reason of default.
-7-
C.
Remedies Cumulative
The rights, powers, elections and remedies of
the Lessor contained in this Lease shall be construed as cumulative
and no one of them shall be considered exclusive of the other or
exclusive of any rights or remedies allowed by law, and the
exercise of one or more rights, powers, elections or remedies shall
not impair or be deemed a waiver of Lessor's right to exercise any
other.
D. No Waiver
No delay or omission of the Lessor to exercise
any right or power arising from any omission, neglect or default of
the Lessee shall impair any such right or power or shall be
construed. as a waiver of any such omission, neglect or default on
the part of the Lessee or any acquiescence therein.
No waiver of any breach of any of the terms,
covenants, agreements, restrictions or conditions of this lease
shall be construed as a waiver of any succeeding breach of the same
or of any of the terms, covenants, agreements, restrictions or
conditions of this lease.
E. Holding Over
It is mutually agreed that if the Lessee shall
hold over after the expiration of this lease for any cause, such
holding over shall be deemed a tenancy from month to month only,
upon the same terms, conditions and provisions of this lease.
XVI. NOTICES
It is mutually agreed that any notice or notices provided
for by this lease or by law, to be given or served upon the Lessee,
may be given or served by mail, registered or certified, with
postage prepaid, and if intended for the City of Newport Beach,
addressed to the City Manager, Newport Beach, California 92660,
or at such other address as may be hereafter furnished to the Lessee
in writing, and if intended for the Lessee, addressed to its Director
at 211 15th Street, Newport Beach, California, 92660 or at such
other address as may be hereafter furnished to the Lessor in writing;
-8-
or it may be served personally upon any corporate officer of Lessee
or person charged with general management responsibilities in
connection with the leased premises; and that any notice or notices
provided by this lease or by law to be served upon Lessor may be
served personally upon the Mayor of the City of Newport Beach or
the City Clerk of said City. Such service shall be deemed complete
at the expiration of forty-eight (48) hours from and after the
deposit in the United States mail of such notice, demand or
communication.
XVII. RECORL.; AND ACCOUNTS
A. Bookkeeping
Lessee covenants.and.agrees that it'will, at
all times during the term of this lease, keep or cause to be kept
true and complete books, records and accounts of all financial
transactions in the operation of all businesses, concessions,
services and activities of whatever nature conducted on or from the
demised premises.
B.. Inspection of Records
All books, records and accounts of every kind
and nature kept by Lessee, its agents or employees relating to the
operation of any business, concession, service or activity conducted
on or from the demised premises shall, at all reasonable times, be,
open and made available for inspection or audit». by the Lessor, its
agents or employees, :upon request.
C. Audit
Lessee covenants and agrees to furnish to Lessor
annually, a non -certified statement showing the annual gross
income derived from.the marina slips, the dry boat storage
facilities, the parking lot, and any other business activity con-
ducted on the demised premises, and the disbursement of. said annual
.gross income. Said statement shall be furnished to Lessor within
thirty (30) days following the completion of Lessee's fiscal year
The cost of said audit shall be borne by Lessee.
A. Building Facilities
Lessee covenants and agrees to pay to Lessor
a minimum rental for the use and occupancy of the building facili-
ties located on the leased premises in the sum of Three Hundred
Dollars ($300.00) per month, payable on the first day of each
month commencing with the effective date of this lease.
B. Parking Lot
Lessee covenants and agrees to pay to Lessor
one hundred percent (100%) of the revenues derived from the parking
lot, payable monthly. Lessee shall purchase a minimum of
twenty-six (26) parking spaces at a fee consistent with Cityparking
lot charges. It is further agreed that thirty-six (36) parking
stalls shall be made available for use at no cost to Lessee or
-r7"< ote.
by those persons renting a boat slip from Lessee. :
C. Marina Slips
Lessee covenants and agrees to pay to Lessor
the sum of forty percent (40%) of the gross revenues received from
_the marina slips, payable monthly. If it is mutually determined
'��'.:s
by the parties hereto that additional boat slips are required,.
Lessee will finance their construction with the additional revenue
derived from the rents being used to retire the debt incurred
for the costs of the new slip construction. Upon payment of the
entire debt incurred for the costs of new slip construction,
Lessee shall pay to Lessor the sum of forty percent (40%) of the
gross revenues derived from the new marina slips.
D. Dry Boat Storage
Lessee covenants and agrees to pay to Lessor
the sum of fity percent (50%) of the revenues received from the
Ary boat storage facilities and lockers, payable monthly. If it
is determined by the parties hereto that additional dry boat storage
and locker facilities are required, Lessee will finance their con-
struction with the additional revenue derived from the rents being. used
to retire the debt incurred for the new dry boat storage and locker
facilities. Upon payment of the entire debt incurred for the cost
of the new dry boat storage and locker facilities, Lessee shall
pay to Lessor the sum of fifty percent (50%) of the gross revenues
derived from the new dry boat storage and locker facilities.
XIX. RENEGOTIATION OF RENTS
If either party deems it necessary at the end
of the yearly audit, all rental rates may be renegotiated and
adjusted by mutual agreement of both parties.
XX. MISCELLANEOUS
A. Inurement
Each and all of the covenants, conditions and
agreements herein contained shall, in accordance with the context,
inure to the benefit of Lessor and apply to and bind Lessee, its
respective heirs, legatees, devisees, executors, administrators,
successors, assigns, licensees, permittees, or any person who may
come into possession or or^upancy of said premises or any part
thereof in any manner whatsoever.: Nothing in this paragraph shall
in any way alter the provisions herein contained against assignment
or subletting or the granting of licenses or concessions.
-11,-
• •
B. Captions
The captions of paragraphs and subparagraphs of
this Lease are for convenience only and do not in any way limit
or amplify the terms and provisions hereof.
IN WITNESS WHEREOF, the parties hereto have executed this
Lease as of the day and year first above written.
APPROVED AS TO FORM:
City Attorney.
CITY OF NEWPORT BEACH
a municipal corporation
By : MayoY�.4i!��
'iM�a
ATTEST:
NEWPORT HARBOR POST NO. 291 OF. THE
AMERICAN LEGION
a California corporation
-12-
A parcel of land situated in the City of Newport
Beach, California, being a portion of Lot 4, Section 33,
Township 6 South, Range 10 West, S.B.B. & M., a portion of
Lot 4, Section 34, Township 6 South, Range 10 West, S.B.B.
& M., and certain filled tidelands described as follows,
to wit:
Beginning at a point in the northerly prolongation
of the Westerly line of 15th Street, as said 15th Street is
laid outand shown upon a map of Tract No. 234, recorded in
Book 13, pages 36 and 37, Miscellaneous Maps, Records of
Orange County, California, said point of beginning being
160 feet northerly from the northeasterly corner of Lot 4,
Block 115 of said Tract No. 234; running thence North 9° 43'
30" East along the Northerly prolongation of the Westerly
Line of said 15th Street, a distance of 109.79 feet to an
intersection with the United States Government Bulkhead line
between Station No. 118 and Station No. 119, as said bulkhead
line is shown upon a map entitled "Harbor Lines -Newport Bay,
Newport Harbor, California", approved May 2nd, 1936, by the
Secretary of War and on file in the office of the U. S.
District Engineer, 751 South Figueroa Street, Los Angeles,
California; thence westerly along said bulkhead line a distance
of 349.9 feet to an intersection with the northerly prolonga-
tion of the easterly line of Lot 13, Block 115 of said Tract
No. 234; thence south 9° 43' 30" West along the said northerly
prolongation of the Easterly line of Lot 13, a distance of
249.79 feet to an intersection with a line 20 feet northerly
of and parallel with the northerly line of said Block 115;
thence south 80° 16' 30" East along the said line 20 feet
northerly of and parallel with the northerly line of Block 115,
a distance of 203.9 feet; thence North 9° 43' 30" East a
distance of 140 feet; thence south 80° 16' 30" East, a distance
of 146 feet to the point of beginning.
RESERVING for street purposes a strip of land 50
feet in width, lying 25 feet on each side of the following
described center line:
Beginning at a. point in the northerly prolongation of
the easterly line of Lot 13, Block 115, as shown on a map of
Tract No. 234, recorded in Book 13, pages 36 and 37, Miscellaneous
Maps, Records of Orange County, California, said point of begin-
ning being 135 feet northerly of the northeasterly corner of
said Lot 13; running thence south 80° 16' 30" East along a line
parallel to the northerly line of said Block 115, a distance of
203.9 feet to a point which is 146 feet westerly of the westerly
line of 15th Street.
EXHIBIT "A"
•
/.93115 71.
II II I III I II I
of
LEASE
THIS LEASE, made and entered into this /p Tp day
.naRtN
, 1975,,by and between the CITY OF NEWPORT
BEACH,a chartered municipal corporation, hereinafter referred to
as "Lessor", and NEWPORT HARBOR POST NO. 291 OF THE AMERICAN LEGION,
a California corporation, hereinafter referred to as "Lessee":
RECITAL 5:
A. Lessor holds title to certain harbor frontage and
tidelands,together with certain uplands abutting thereon located
at 15th Street and West Bay, City of Newport Beach, County of Orange,
State of California, hereinafter more particularly described.
B. "Lessee has constructed substantial improvements upon
the property consisting of certain buildings,' boat anchorages,
moorings, slips,,docks, ramps, launching facilities, parking lot,
and dry boat storage which Lessee presently operates and maintains
pursuant to a lease between Lessor and Lessee dated February 26,.1951.
The term of the existing lease expires on January 31, 1976. Lessee
has requested Lessor to extend the term of the lease for an additional
twenty-five (25) years:
C. It is the judgment of the City Council of the City of
Newport Beach that the uplands cannot be used without the tidelands,
nor can said tideland's be used without the uplands abutting thereon;
and it is further the judgment of Lessorthat the leasing of the
whole of said lands hereinafter described as one parcel is necessary
for the proper development and use of said lands;water frontage
and tidelands for recreational, public, civic; beaches, commerce,.
navigation and fishery purposes.
D.
It is the judgment of the City Council of the City of
Newport Beach that the leasing of said lands to Lessee, upon the
conditions in this' agreement specified, is not inconsistent with
the trust imposed. such portion of the 1a . hereinafter
described, which may constitute tidelands, and it is further the
judgment of the City Council of the City of Newport Beach that the
leasing of said uplands as hereinafter described upon the conditions
in this agreement specified, is for a public purpose and does not
violate the Constitution of the State of California and is permis-
sible under State law.
E. Lessor proposes to lease to Lessee the premises
described hereinafter, and Lessee is willing to accept said lease on
the terms and conditions hereinafter set forth. This lease does
not violate Section 1402 of the Newport Beach City Charter in that
this lease constitutes a releasing of property under lease at the
effective date of said Charter.
NOW,, THEREFORE, IN CONSIDERATION OF THE FOREGOING RECITALS
AND THE MUTUAL COVENANTS set forth below, Lessor and Lessee: hereby
agree as follows:
I. DESCRIPTION OF LEASED PREMISES
Lessor hereby leases, and Lessee does hereby:accept a
lease of the property, buildings and related parking and boat
facilities located at 15th Street and West Bay, as more particularly
described in Exhibit "A", which is attached hereto and made a part
herein by, this reference.
II. TERM
In order to comply with Section 420 of the Newport Beach
City Charter which restricts the leasing of property for a period
of more than twenty-five (25) years without prior voter approval,
the existing lease between Lessor and Lessee dated February 26, 1951,
may be extended for a period of twenty-four (24) years and two (2)
months, which would constitute a total period of twenty-five (25)
years from the expiration date of the existing lease, to wit, •
January 31, 1976. The term of this lease will commence on March 15,
1975, and expire on March 15,2000.
III. USE
Lessee shall use the demised premises; together with the
buildings, parking and boat and marine facilities located thereon
'for the purposes of managing, operating and conducting the activi-
ties of the American Legion. In and as a part of its duties in
managing and operating said American Legion Post, Lessee shall
not discriminate as to race, color, creed or the civil rights and
liberties of individuals subject to the normal rules and operating
procedures of the American Legion. Lessor retains the right to
locate an Acquatic Center in the area formerly used by the
Newport Harbor Lawn Bowling Association; as more accurately
depicted on Exhibit "B" attached hereto and made a part herein
by this reference. Lessee covenants and agrees to permit Lessor
to use its boat launching facilities in connection with said
Acquatic Center.
IV. USE AS A COMMUNITY CENTER BY OTHER ORGANIZATIONS
When the demised premises and buildings are not in use
by the Lessee, the premises and buildings shall be available for
the use as a comniunity.center and recreation instruction. facility
by the City Parks, Beaches and Recreation Department on a first -
'priority basis, and.by local organized community, civic related
,organizations in accordance with reasonable rules, regulations,
fees and scheduling to be established by Lessee with the approval
of the City Manager:
V. TYPE OF BUSINESS ACTIVITY
Lessee shall. not grant any concession, license, permit
or privilege for the conduct ofany business or other operation.,
for profit or alter the use or type of service on the demised
premises without the prior approval of the City Manager. •
VII. TAXES AND UTILITIES
Lessee shall promptly pay for all utility services
furnished to it and shall pay before delinquent any general and
special taxes or assessments or other governmental charges, if
any, which may be levied on the demised premises or furnishings
therein, or improvements thereon, or any possessory interest therein
arising out of or based upon the leasehold interest throughout the
term hereof, or may be imposed upon Lessee as a resultof its
operations under the lease., Satisfactory evidence of such payments
shall be delivered to Lessor upon demand therefor.
VIII. MAINTENANCE OF LANDSCAPING AND IMPROVEMENTS
Lessee covenants and agrees that during the term of
this lease it will, at its own cost and expense, maintain the
grounds, landscaping, and all buildings,.. and any other improve-
ments of any kind in existenceor nature constructed or installed
on the demised premises by the Lessee, at a high standard of
maintenance and repair. Maintenance shall include painting of all
buildings and boat facilities. If in the judgment of the Lessor,
such standards of maintenance and repair are not being maintained,
Lessor may at its option, after written notice thereof to the
Lessee and Lessee's failure to commence in good faith to remedy
the same within the time hereinprovided and thereafter diligently
prosecute thesame to completion, elect to correct any deficiency,
whether it be in reference to grounds, landscaping, buildings or
improvements. Lessee covenants and agreestopay to the Lessor
on demand any and all sums expended by it in correcting any such
deficiency.• if, in the judgment of the Lessor, the disrepair or .
lack of maintenance constitutes an emergency, the notice herein
provided shall be a 24-hour notice to remedy; in all other cases
it shall be a 5-day notice.
-4-
IX. INSURANCE - HOLD HARMLESS
Lessee shall save and keep Lessor, its officers, agents
and employees free and harmless from any and all claims or demands
of any name or nature whatsoever arising out of, or incident to,
the use and occupancy of the premises herein described by Lessee.
In partial performance of this obligation by Lessee, Lessee shall
procure and at all times during the term of this Lease maintain in
full force and effect a policy, or policies, of public liability
and property damage insurance protecting the City of Newport Beach,
its officers, agents and employees from all claims or demands for
damages. The policy, or policies, shall provide .for not less than
Two Hundred Thousand Dollars ($200,000.00) for injury or death of
one. person; Five Hundred Thousand. Dollars ($500,000.00) for injury
or death of .two or more persons; and Fifty Thousand Dollars.
($50,000.00) for damages to. property. The City Manager may require ..
an increase in the amount of insurance from time to time in
accordance with changes in economic conditions. Attached to said
policy shall be an endorsement which shall provide as follows:
"Within the limits set forth in this policy,
to indemnify and save the City.of Newport Beach, its
officers, agents and employees, free and harmless from
all damage, claim, loss or liability of any.name or
nature whatsoever which the City of Newport Beach, its
officers, agentsor employees may hereafter sustain or
incur,or may be imposed: upon them, arising out ot, or
in any way connected with, the use or occupancy by the
insured, its servants, agentsand.employees, of the
premises described in a lease granted toinsured by the
City of Newport Beach."
Lessee shall furnish, and maintain with the Lessor,: either
the original policy, or policies, or a certified copy, or copies,
thereof. The policy, or policies, shall be approved as to sufficiency
by the City Manager and as to form by the City Attorney.
X. LESSOR'S RIGHT OF INSPECTION
Lessor reserves the right by its authorized agents
employees or representatives to enter the leased premises to.inspect»
the same or any rt thereof at any time an o attend to or
• protect the LessoP�s interest under this least.
XI. COMPLIANCE WITH LAWS
Lessee covenants and agrees to comply with all rules,
regulations, statutes, ordinances and laws of the State of California,
County of Orange, the City of Newport Beach or any other governmental
body or agency having lawful jursidiction over the leased premises
or the business, enterprises or activities conducted thereon.
XII. ASSIGNMENT
Except as provided in paragraph IV hereinabove, Lessee
shall not assign, transfer,. sublease or give any grant of control
of this lease or demised premses, or any part thereof, either
voluntarily or involuntarily, unless first approved by the City
Council.
XIII. 'NON-COMPLIANCE
If the Lessee..fails to comply with any of the terms and
conditions of this Lease, the Lessor may give to the Lessee a
notice in writing of such failure and specify therein the particu-
lars in which Lessee has.failed:to comply with the provisions of
this Lease. If the Lessee fails for a period of thirty .(30) days
after the giving of such notice to comply:with the provisions of
this Lease, the Lessor may; at its option, terminate.this Lease,
and all rights of the Lessee therein shall cease and terminate and
the Lessee shall immediately thereafter deliver possession of the
premises to the Lessor.
XIV. SURRENDER OF PREMISES UPONEXPIRATION OR
TERMINATION
Upon the expiration of the term of this lease or
sooner termination thereof as herein provided, Lessee shall deliver
possession of said demised premises to Lessor in the same condition
as delivered to Lessee, reasonable wear and tear excepted, and
also excepting any changes or alterations authorized or approved
in writing by the City Manager or City Council. Upon the expiration
or termination of this lease, any additions or improvements made
upon the demised premises shall become the property of the Lessor.
. DEFAULT AND TERMINATION OF LEASE
A. Default
Time and each of the terms, covenants and
conditions hereof are expressly made the essence of this Lease.
If the Lessee shall fail to comply with any of
the terms, covenants, or conditions of this Lease, including the
payment of rental herein reserved, at the time and in the amount
herein required, and shall.fail to remedy such default within
thirty (30) days after service of a written notice from Lessor so
to do if the default may be cured by the payment of money, or to
commence in good faith to remedy any other default within thirty
(30) days and thereafter diligently prosecute the same to completion,
or if Lessee shall abandon or vacate the leased premises, Lessor
may, at its option, and without further notice or demand, terminate
this Lease and enter upon the leased premises and take possession
thereof, and remove any and all persons therefrom with or without
process of law.'
B. Surrender of Possession Upon Termination
Lessee covenants and agrees that upon the
expiration or sooner termination of this Lease, the Lessee will
peaceably surrender the leased premises with all buildings and
improvements, in the same condition as when received or constructed,
reasonable use and wear thereof, and damage by fire, Act of God,
or by the elements excepted. Lessee expressly waives any right
which it may have to relocation assistance or costs in vacating
the demised premises. Any improvements built, constructed or
placed upon the leased premises by the Lessee, or anyone 'holding
by, under, or through it, shall remain on the leased premises and
become the property of the Lessor without any cost to Lessor upon
the termination of this Lease, whether by lapse of time or by
reason of default.
41110
C.Remedies Cumulative
The rights, powers, elections and remedies of
the Lessor contained in this Lease shall be construed as cumulative
and no one of them shall be consideredexclusive of the other or
exclusive of any rights or remedies allowed by law, and the
exercise of one or more rights, powers, elections or remedies shall
not impair or be deemed a waiver of Lessor's right to exercise any
other.
D. No Waiver
No delay or omission of the Lessor to exercise
any right or power arising from any omission, neglect or default of
the Lessee shall impair any such right or power or shall be
construed, as a waiver of any such omission, neglect or default on
the part of the Lessee or any acquiescence therein.
No waiver of any breach of any of the terms,
covenants, agreements, restrictions or conditions of this lease
shall be construed as a waiver of any succeedingbreach of the same
or of any of the terms, covenants, agreements, restrictions or
conditions of this lease.
E. Holding Over
It is mutually agreed that if the Lessee shall,
hold over after the expiration of this lease for any cause, such
holding over shall be deemed a tenancy from month to month only,
upon the same terms, conditions and provisions of this lease.
XVI. NOTICES
It is mutually agreed that any notice or notices provided
for by this lease or by law, to be given or served upon the Lessee,
may be given or served by mail, registered or certified, with
postage prepaid, and if intended for the City of Newport Beach,
addressed to the City Manager, Newport Beach, California 92660,
or at such other address as may be hereafter furnished to the Lessee
in writing, and if intended for the Lessee, addressed to its Director
at 211'15th Street, Newport Beach, California, 92660 or at such
other address as may be hereafter furnished to the Lessor in writing;
-8-
i
or it may be served personally upon any corporate officer of Lessee
or person charged with general management responsibilities in
connection with theleased premises; and that any notice or notices
provided by this lease or by law to be served upon Lessor may be
served personally upon the Mayor of the City of Newport Beach or
the City Clerk of said City. Such service shall be deemed complete
at the expiration of forty-eight (48) hours from and after the
deposit in the United States mail of such notice, demand or
communication.
XVII. RECORDS AND ACCOUNTS
A. Bookkeeping
Lessee covenants and agrees thatit will, at
all times during the term of this lease, keep or cause to be kept
true and complete books, records and accounts of all financial
transactions in the operation of all businesses, concessions,
services and activities of whatever nature conducted on or from the
demised premises.
B. Inspection of Records
All books, records and accounts of every..kind
and nature kept by Lessee, its agents or employees relating:to the
operation.of any business, concession, service or activity conducted
on or from the demised premises shall, at all reasonable times,.be..
open and made available for inspection or audit::, by the Lessor, its
agents or employees,:upon.request.
C. Audit
Lessee covenants and agrees to furnish to Lessor
annually, a non -certified statement showing the annual gross
income derived from the marina slips; the dry boat storage
facilities, the parking lot; and any.other business activity con-
ducted on the demised premises, and the disbursement of said annual
.gross income. Said statement shall be furnished to Lessor within
thirty (30) days following the completion of Lessee's fiscal year.
The cost of said audit shall be borne by Lessee.
XVIII.''RENTAL
. Building Facilities
Lessee covenants and agrees to pay 'to Lessor
a minimum rental for the use and occupancy of the building facili-
ties located on the leased premises in the sum of Three Hundred
Dollars ($300.00) per month, payable on the firstday of each
month commencing with the effective date of this .lease.
B. Parking Lot
Lessee covenants and agrees to pay to Lessor
one hundred percent (100%) of the revenues derived from the parking
lot, payable monthly. Lessee shall purchase a minimum of
twenty-six (26) parking spaces at a fee consistent with City parking
lot charges. It is further agreed that thirty-six (36) parking
stalls shall be made available for use at no cost to Lessee or.
by those persons renting a boat slip from Lessee.
C. Marina Slips
Lessee covenants and agrees to pay to Lessor
the sum of forty percent (40%) of the gross revenues received from
the marina slips, payable monthly. If it is mutually determined.
by the parties hereto that additional boat slips'are required,
Lessee will finance their construction with the additional revenue
derived from the rents being used to retire the debt incurred
for the costs of the new slip construction. Upon payment of the
entire debt incurred for the costs of new slip construction,
Lessee shall pay to Lessor the sum of forty percent (.40%) of the,.
gross revenues derived from the new marina slips.
D. Dry Boat Storage
Lessee covenants and agrees to pay to Lessor
the sum of fity percent (50%) of the revenues received from the
dry boat storage facilities and lockers, payable monthly. If it
is determined by the parties hereto that additional dry boat storage
and locker facilities are required, Lessee will finance their con-
struction with the additional revenue derived from the rents being used
to retire the debt incurred for the new dry boat storage and locker
-10-
facilities. Upon payment of the entire debt incurred for the cost
of the new dry boat storage and locker facilities, Lessee shall
pay to Lessor the sum of fifty percent (50%) of the gross revenues
derived from the new dry boat storage and locker facilities.
XIX. RENEGOTIATION OF RENTS
If either party deems it necessary at the end
of the yearly audit, all rental rates may be renegotiated and
adjusted by mutual agreement of both parties.
XX. MISCELLANEOUS
Inurement
Each and all of the covenants, conditions and
agreements herein contained shall, in accordance with the. context,
inure to the benefit of Lessor and apply to and bind Lessee, its
respective heirs, legatees, devisees, executors, administrators,
successors, assigns, licensees., permittees, or any person who may
come into possession or occupancy of said premises or any part
thereof in any manner whatsoever.. Nothing :in this paragraph shall
in any way alter the provisions herein contained against assignment
or subletting or the granting of licenses or concessions.:
• •
B. Captions
The captions of paragraphs and subparagraphs of
this Lease are for convenience only and do not in any way limit
or amplify the terms and provisions hereof.
IN WITNESS WHEREOF, the parties hereto have executed this
Lease as of the day and year first above written.
APPROVED AS TO FORM:
City Attorney.
CITY OF NEWPORT BEACH
a municipal corporation
By :-0t( Lam'
Mayor
NEWPORT HARBOR POST NO. 291 OF THE
AMERICAN LEGION
a California corporation
-12-
A parcel of land situated in the City of Newport
Beach, California, being a portion of Lot 4, Section 33,
Township 6 South, Range 10 West, S.B.B. & M., a portion of
Lot 4, Section 34; Township 6 South, Range 10 West, S.B.B.
& M., and certain filled tidelands described as follows,
to wit:
Beginning at a.point in the northerly prolongation
of the Westerly line of 15th Street, as said 15th Street is,
laid out. and shown upon a map of Tract No. 234, recorded in
Book 13, pages 36 and 37, Miscellaneous Maps, Records of
Orange County, California, said point of beginning being
160 feet northerly from the northeasterly corner of Lot 4,
Block 115 of said Tract No. 234; running thence North 9° 43'
30" East along the Northerly prolongation of the Westerly
Line of said 15th Street, a distance of 109.79 feet to an
intersection with the United States Government Bulkhead line
between Station No. 118 and Station No. 119, as said bulkhead
line is shown upon a map entitled "Harbor Lines -Newport Bay,
Newport Harbor, California", approved May 2nd, 1936, by the.
Secretary of War and on file in the office of the U. 5.
District Engineer, 751 South Figueroa Street, Los Angeles,
California; thence westerly along said bulkhead line a distance
of 349.9 feet to an intersection with the northerly prolonga-
tion of the easterly line of Lot 13, Block 115 of said Tract
No. 234; thence south 9° 43' 30" West along the said northerly
prolongation of the Easterly line of Lot 13, a distance of
249.79 feet to an intersection with a line 20 feet northerly
of and parallel with the northerly line of said Block 115;
thence south 80° 16' 30" East along the said line 20 feet
northerly of and parallel with the northerly line of Block 115,
a distance of 203.9 feet; thence North 9° 43' 30" East a
distance of 140 feet; thence south 80° 16' 30" East, a distance
of 146 feet to the point of beginning.
RESERVING for street purposes a strip of land 50
feet in width, lying 25 feet on each side of the following
described center line:
Beginning at.a point in the northerly prolongation of
the easterly line of Lot 13, Block 115, as shown on a map of
Tract No. 234, recorded in Book 13, pages 36 and 37, Miscellaneous -
Maps, Records of Orange County, California, -said point of begin-
ning being 135 feet northerly of the northeasterly corner of
said Lot 13; running thence south 80° 16'.30"East along a line
parallel to the northerly line of said Block 115, a distance of
203.9 feet to a point which is 146 feet westerly of the westerly
line of 15th Street.
EXHIBIT "A"
2I Lbjo\
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jJLJ..jLJJJJj
71
•
WWC:mee
2/6/59
GENERAL
Parties
CITY OF NEWPORT BEACH
OFFICE -OF THE CITY ATTORNEY
SUMMARY OF CITY'S AMERICAN•LEGION LEASE
INFORMATION
to Lease
Date of Lease
City Council approval
Original lease
City of Newport Beach, Lessor
Newport Harbor Post -No. 291 of
the American Legion, Lessee "
February 26, 1951
(Res. No.)..
Land Location 15th St. and Bay Front
Source of City's Title • Uncertain
Approximate Area 1.54 acres
February 26, 1951
(Date adopted)
Frontage
• .Water Street <.
349.90' 109.79'.�`•
Reserved Area 10,195 Sq. Ft., 50' Street
Reservation, 203.9' long
II. LEASE DURATION No. years: 25
From: February 1, 1951, to January 31, 1976.
'`III., LEASE PROVISIONS
Rental:
Purpose:
Repairs:
$1.00 per year, plus the amount.of the fire insurance
premiums paid by the City on the buildings located on the
demised premises.'
Recreational, educational and civic purposes.
Lessee to keep the buildings in good condition and repair
and to keep the grounds surrounding the buildings in a
good condition, free from weeds, rubbish, papers, etc.
Assignability: No assignment of lease or subletting of premises,
and no mortgaging of the leasehold interest or any of the':,
improvements, without written consent of Lessor.
Holding over of premises after end of lease term; with.
express consent of Lessor, toabe construed as month -to=
month tenancy at $100.00 per month rental and upon all
other conditions of original lease.
Renewal:
Terms of default: Upon default in any condition of the Lease by
Lessee continuing for 60 days after written notice to
Lessee, Lessor may declare -term ended and re-enter
premises. Lessee waives compensation for forfeiture and:
.demand for possession.
Taxes: Lessee to pay all taxes levied upon leasehold interest,
and all water rates, meter charges and other charges
imposed upon demised premises before delinquency.
Insurance: Lessor to maintain adequate fire insurance on improve-
ments, and Lessee to maintain public liability insurance
with minimum liability of.$100,000-$300,000.