HomeMy WebLinkAboutA3785 - LEASE AGREEMENT WITH PALM CANYON THEATER FOR 538 NORTH PALM CANYON DRIVE r
LEASE
By and Between
THE CITY OF PALM SPRINGS
and
PALM CANYON THEATRE,INC.
55575.18175\32359304.3
LEASE
By and Between
THE CITY OF PALM SPRINGS
and
PALM CANYON THEATRE,INC.
T I LEASE ("Lease") i made and entered into this 10 day of
OA 201itjby and between the CITY OF PALM SPRINGS, a
municipal corporation (referred to variously as "Landlord" or "City"), and PALM CANYON
THEATRE INC., a non-profit corporation ("Tenant" or "Palm Canyon Theatre") who agree as
follows:
1.0 LEASE SUMMARY. Certain fundamental lease provisions are presented in this
Section and represent the agreement of the parties hereto, subject to further definition and
elaboration in the respective referenced Sections and elsewhere in this Lease. In the event of any
conflict between any fundamental lease provision and the balance of this Lease, the latter shall
control. References to specific Sections are for convenience only and designate some of the
Sections where references to the particular fundamental lease provisions may appear.
1.1 Premises. The "Premises" shall refer to that certain real property located in
the City of Palm Springs, County of Riverside, State of California, located at 538 North Palm
Canyon Drive and shown on Exhibit"A"hereof together with the improvements located thereon as
depicted on the Plot Plan attached as Exhibit `B"hereof.
1.2 Approximate Floor Area of Premises. 10,755 square feet of exclusive use
and 2,850 square feet of non-exclusive use floor area (said measurements being to the outside of
exterior walls).
1.3 Lease Commencement Date/Term. On July 9, 1997, City and Tenant entered
into that certain Lease Agreement ("Prior Lease") for the Premises. By execution of this Lease, the
parties agree that the Prior Lease is terminated and has no further force and effect except for any
obligations which specifically survive. Tenant is in occupancy as of the Commencement Date
under the Prior Lease terms. The Lease shall commence November 1, 2019. Lease Term: Five (5)
years; Lease Termination Date: October 31, 2024.
1.4 Rent. $2,500 per month (see Section 3.1).
1.5 Security Deposit. $2,500.00; previously received with execution of original
lease. (See Section 3.7)
1
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
1.6 Use of Premises. Non-profit professional actors' equity/non-equity live
indoor theatre; including an approximately 200-seat theatre, dressing rooms and showers, back
stage and prop room, costume shop and scene shop. The premises may also be used for community
outreach and educational programs. The Tenant may allow other non-profit groups to use the
facility provided the use is consistent with this section and Section 9 of the Lease, "Assignment and
Subletting". The Tenant is entitled to recover its cost incurred when another user leases the facility.
The Tenant's use and possession of the Premises shall not be exclusive,but shall be deemed subject
to the Landlord's right to permit use of the Premises by other nonprofit entities. Without limitation
of the foregoing and in recognition of the substantial contributions and improvements to the
Premises by the Palm Springs International Film Festival, a California nonprofit corporation("Film
Festival"), Tenant specifically acknowledges and agrees to the exclusive use of the Premises for the
Palm Springs International Film Festival ("Film Festival") for approximately fifteen (15) days each
January, and the Palm Springs International Short Film Festival ("Short Film Festival") for
approximately eight (8) days in June each year, and in addition; for film screenings ("Screenings")
by the Palm Springs International Film Society, a California nonprofit corporation ("Film Society")
not less than three (3) evenings per month, scheduled a minimum of 30 days in advance, on
Mondays, Tuesdays, or Wednesdays, or other such time as Tenant is not using the theater for live
performances or rehearsal. With the exception of the utility credit provided for in Section 3.8(c)
below, the rent due shall not be affected or offset by the uses required in this section. Tenant shall
coordinate a minimum of 30 days in advance with Film Festival regarding scheduling of Film
Festival and Short Film Festival. Tenant may conduct rehearsals in classroom spaces on the wings
of the property during film screenings and Film Festival events provided that such use will not
interfere with the exclusive use of the theatre (including auditorium and stage) by Film Festival and
its patrons during such events. Tenant has been in possession of the Premises under the Prior Lease
and by execution of this Lease, Tenant agrees that the Premises and the Building were at such time
in tenantable condition and that Tenant has accepted the condition of the Premises and the Building
in their tenantable condition.
1.7 Address for Notices
Tenant:
Palm Canyon Theatre, Inc.
William J. Layne or Mr. J. W. Layne
538 North Palm Canyon Drive
Palm Springs, CA 92262
Landlord:
City of Palm Springs
David H. Ready, Esq., Ph.D., City Manager
3200 East Tahquitz Canyon Way
Palm Springs, CA 92262
2
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
2.0 TERM.
2.1 Term. The term of this Lease shall commence on the date specified in
Section 1.3 ("Commencement Date") and shall continue for a period of five years unless earlier
terminated as provided herein. The Parties may, by mutual written agreement, extend the term of
this Lease for an additional five (5) years, upon such terms and conditions as the Parties may
mutually agree to. The Parties shall meet and confer, at least twelve (12) months prior to the end
of the first five (5) year term, in order to discuss the potential extension of the initial term.
2.2 Termination By Landlord. Landlord shall have the right to terminate this
Lease effective at any time after the first anniversary of the Commencement Date, for its
convenience and without cause, upon giving Tenant eighteen (18) month's prior written notice.
Tenant hereby waives any right to receive any other compensation from Landlord, including, but
not limited to, the value of Tenant's leasehold interest, loss of goodwill and relocation benefits,
inverse condemnation or the taking of property and Landlord shall have no obligation to pay
Tenant therefore. Landlord shall not be obligated to pay Tenant any portion, including any
unamortized portion, of any costs of improvements except as the Parties may agree in writing by
future amendment to this Lease. Landlord shall have the right to terminate this Lease upon thirty
(30) days' advance written notice to Tenant for non-performance of this agreement including
delinquent rental payments, failure to provide annual reports as outlined in Exhibit "E", or any
other breach of agreement terms (see Section 3.8).
2.3 Holding Over. Any holding over after the expiration of the term of this
Lease, with the consent of Landlord, express or implied, shall be construed to be a tenancy from
month to month, cancelable upon thirty (30) days' written notice, and continued at the rent in
effect at the expiration of the term and upon terms and conditions as existed during the last year of
the term hereof.
3.0 RENT.
3.1 Rent. Tenant shall pay to Landlord, during the term of this Lease from and
after the Commencement Date as monthly rental ("Monthly Rental") for the Premises the sum
specified in Section 1.4 hereof, .unless Section 4.6 requires fair market value in which case the
Tenant shall pay the sum specified in Section 4.6, which sum shall be paid in advance on the first
day of each calendar month. In the event the Commencement Date does not occur on the first day
of a calendar month, the Tenant shall pay the rental for the fractional month on the
Commencement Date on a per diem basis (calculated on a thirty-day month). All rental to be paid
by Tenant to Landlord shall be in lawful money of the United States of America and shall be paid
without deduction or offset, prior notice or demand at the address designated in Section 1.7
hereof.
3.2 Cost of Living Adjustment. Upon each annual anniversary date of the
3
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
Commencement Date or if the Commencement Date is not on the first day of a month,then on the
first day of the next calendar month, the Monthly Rental shall be adjusted in proportion to
changes in the Consumer Price Index. Such adjustment shall be made by multiplying the original
Monthly Rental by a fraction,the numerator of which is the value of the Consumer Price Index for
the calendar month three (3) months preceding the calendar month for which such adjustment is to
be made and the denominator of which is the value of the Consumer Price Index for the same
calendar month immediately prior to Commencement Date. For example, if the adjustment is to
occur effective June 1, 2019, the index to be used for the denominator is the index for the month
of March preceding the Commencement Date. However, in no event shall the rent be reduced
below the Monthly Rental in effect immediately preceding such adjustment. The "Consumer
Price Index"to be used in such calculation is the Consumer Price Index for All Urban Consumers
(CPI-U): Riverside-San Bernardino-Ontario, published by the United States Department of Labor,
Bureau of Labor Statistics (December 2017=100). If both an official index and one or more
unofficial indices are published, the official index shall be used. If said Consumer Price Index is
no longer published at the adjustment date, it shall be constructed by conversion tables included in
such new index.
3.3 Annual Repair and Improvement List. City and Tenant shall meet with
each other on each anniversary of the Commencement Date in order to develop a list of repairs
and improvements of the Premises that the City intends to undertake for the following year. City
and Tenant shall work in good faith in developing such list; provided however, that the City, as
the owner of the Premises, retains the ultimate discretion with regard to what repairs and
improvements are listed and ultimately undertaken.
3.4 Reports. Tenant shall submit an annual report detailing its programming,
number of participants, and accounting of funds spent on maintenance of the facility.
3.5 Real Prooerty Taxes. In addition to all rentals herein reserved, if required,
Tenant shall pay either directly to the taxing authority or to Landlord, annual real estate taxes and
assessments levied upon the Premises (including any possessory interest taxes levied under
Revenue and Tax Code 107.6), as well as taxes of every kind and nature levied and assessed in
lieu of, in substitution for, or in addition to, existing real property taxes.
3.6 Utilities.
(a) Water. City shall pay for water utility services, since the buildings are not
separately metered from the City's Frances Stevens Park.
(b) Solid Waste. Palm Springs Disposal Service picks up trash from Frances
Stevens Park as part of its franchise agreement with the City. Tenant may use trash
receptacles provided for Frances. Stevens Park and located at the south entrance to the
parking lot off of Indian Canyon Drive for normal trash disposal; however, upon request
of City, Tenant shall pay for any excessive trash disposal beyond the capacity of said
trash receptacles.
4
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
(c) All other Utilities. Tenant shall pay before delinquency all charges for gas,
heat, electricity, power, sewer, telephone service, and all other utility services
(other than water and trash, as described above) used in, upon, or about the
Premises by Tenant or any of its subtenants, licensees, or concessionaires
during the term of this Lease, with the exception of during approximately two
(2) weeks of Film Festival use, for which Landlord will prorate credit for that
month's rent in an amount estimated to equal the Film Festival's utility usage
during that time.
3.7 Security Deposit. Tenant has previously paid $2,500.00 deposit as part of
the original Lease dated July 9, 1997. Said sum shall be held by Landlord as security for the
faithful performance by Tenant of all of the terms, covenants, and conditions of this Lease to be
kept and performed by Tenant during the term hereof. If Tenant defaults with respect to any
provisions of this Lease, including but not limited to the provisions relating to the payment of rent,
Landlord may (but shall not be required to) use, apply or retain all or any part of this Security
Deposit for the payment of any rent or any other sum in default, or for the payment of any other
amount which Landlord may spend or become obligated to spend by reason of Tenant's default or
to compensate Landlord for any loss or damage which Landlord may suffer by reason of Tenant's
default. If any portion of said deposit is so used or applied, Tenant shall, within ten (10) days after
demand therefor, deposit cash with Landlord in an amount sufficient to restore the Security Deposit
to its original amount and Tenant's failure to do so shall be a material breach of this Lease.
Landlord shall not be required to keep this Security Deposit separate from its general funds, and
Tenant shall not be entitled to interest on such Security Deposit. If Tenant shall fully and faithfully
perform every provision of this Lease to be performed by it, the Security Deposit or any balance
thereof shall be returned to Tenant (or, at Landlord's option, to the last assignee of Tenant's
interests hereunder) at the expiration of the Lease term, provided that Landlord may retain the
Security Deposit until such time as any amount due from Tenant in accordance with Paragraph 5
hereof has been determined and paid in full. Should Landlord sell its interest in the Premises
during the term hereof and if Landlord deposits with the purchaser thereof the then unappropriated
funds deposited by Tenant as aforesaid, thereupon Landlord shall be discharged from any further
liability with respect to such Security Deposit. Nothing contained in this Section shall in any way
diminish or be construed as waiving any of the Landlord's other remedies as provided in Section
10.0 hereof, or by law or in equity.
3.8 Late Payment. Tenant hereby acknowledges that late payment by Tenant
to Landlord of rental or other sums due hereunder will cause Landlord to incur costs not
contemplated by this Lease, the exact amount of which is extremely difficult to ascertain. Such
costs include, but are not limited to, processing and accounting charges. Accordingly, any
payment of any sum to be paid by Tenant not paid within five (5) days of its due date shall be
subject to a five percent (5%) late charge. Landlord and Tenant agree that this late charge
represents a reasonable estimate of such costs and expenses and is fair compensation to Landlord
for its loss suffered by such late payment by Tenant. Sixty (60) days before the anniversary date
each year the City shall notify the Tenant of any outstanding delinquency, which must be cured
5
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
prior to the anniversary date or the City may exercise its right of termination under Section 2.2
and terminate the lease. If a due date falls on a date the City offices are closed for holidays or
otherwise, payment may be accepted as on time on the City's next open business day.
4.0 USE OF THE PREMISES
4.1 Permitted Use. The Landlord hereby leases to Tenant and Tenant hires from
Landlord the exclusive use of the Premises, with improvements as defined herein, for the purpose
of conducting thereon only the use specified in Section 1.6 of this Lease.
4.2 Prohibited Uses. Tenant shall not sell or permit to be kept, used, displayed or
sold in or about the exclusive Premises: (a) pornographic or sexually explicit books, magazines,
literature, films or other printed material, sexual paraphernalia, or other material which would be
considered lewd, obscene or licentious, (b) any article that may be prohibited "by standard forms• of
fire insurance policies; nor shall Tenant shall use, or permit to be used upon the Premises any of the
foregoing, as part of any gaming machine or video or arcade game.
4.3 Compliance with Laws.
(a) Tenant shall comply with all laws, ordinances, orders, regulations, rules,
resolutions and other governmental requirements relating to the use, condition or occupancy of the
Premises which may now or hereafter be in force, including, without limitation, the Americans
with Disabilities Act of 1990, and applicable Environmental Laws as defined herein (collectively,
the "Laws"). The cost of compliance with any of the Laws (except any capital expenditures, which
are the Landlord's responsibility, as provided in Section 5.3 hereof) shall be borne by Tenant.
Tenant shall not use or occupy the Premises in violation of any Law or of the certificate of
occupancy issued for the Building of which the Premises are a part, and shall, upon five (5) days'
written notice from Landlord, discontinue any use of the Premises which is declared by any
governmental authority having jurisdiction to be a violation of Law or of the certificate of
occupancy. Tenant shall not use or occupy the Premises in any manner which is: (i)potentially
injurious to the public health, safety or welfare, the environment on the Premises; or (ii) in a
manner which creates a basis for liability of Landlord to any governmental agency or third party
under any applicable statute or common law theory including, but not limited to, Environmental
Laws. Tenant shall comply with any direction of any governmental authority having jurisdiction
which shall, by reason of the nature of Tenant's use or occupancy of the Premises, impose any duty
upon Tenant or Landlord with respect to the Premises or with respect to the use or occupation
thereof. Tenant shall not do or permit to be done anything which will invalidate or increase the
cost of any fire, extended coverage or any other insurance policy covering the Building and/or
property located therein and shall comply with all rules, orders, regulations and requirements of the
Pacific Fire Rating Bureau or any other organization performing a similar function. Tenant shall
promptly upon demand reimburse Landlord as additional rent for any additional premium charged
for such policy by reason of Tenant's failure to comply with the provisions of this Paragraph.
Tenant shall not do or permit anything to be done in or about the Premises which will in any way
obstruct or interfere with the rights of other tenants or occupants of the Building, or injure or annoy
6
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
them, or use or allow the Premises to be used for any improper, immoral, unlawful or objectionable
purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or about the Premises.
Tenant shall not commit or suffer to be committed any waste in or upon the Premises and shall
keep the Premises in a reasonably good, neat and clean condition and appearance.
(b) Tenant shall comply with all federal, state and local laws, ordinances, rules and
regulations relating to environmental protection or the use, analysis, generation, treatment,
handling, storage, disposal, release, threatened release or transportation of any Hazardous Materials
(as hereinafter defined) including, but not limited to Environmental Laws. Tenant shall not cause
or permit any Hazardous Materials to be brought upon, kept, used, generated, treated, handled,
released, stored or disposed in, on, under or about the Building or Premises by Tenant, its agents,
employees, contractors, licensees or invitees, without the prior written consent of Landlord. The
term "Hazardous Materials" as used in this Lease includes any hazardous, toxic, contaminated or
polluting substance, material or waste which is regulated by'any local governmental authority or
special district, the State of California or the United States Government, including any material,
contaminant, pollutant, or substance which is: (i) designated as a "hazardous waste," "hazardous
material," "hazardous substance," "extremely hazardous waste" or "restricted hazardous waste";
(ii) flammables or explosives; (iii) petroleum or petroleum products; (iv) asbestos;
(v) polychlorinated biphenyls ("PCB"), or PCB-containing materials; (vi) radioactive materials; or
(vii)materials or chemicals stated to be known to cause cancer or reproductive toxicity. In
addition, the term "Hazardous Materials" shall also include those materials and substances which
are deemed to be hazardous under applicable case law and/or common law theories including,
without limitation, theories of nuisance and tort liability. Notwithstanding the foregoing, Tenant
may, without Landlord's prior consent, use any ordinary and customary materials reasonably
required to be used by Tenant in the normal course of Tenant's office operation on the Premises, so
long as such use is in compliance with this Lease, all applicable Laws, and does not expose the
Building, Property, Premises or any neighboring properties to any material risk of contamination or
damage or expose Landlord to any liability therefor. Landlord makes no representation or warranty
as to the presence of Hazardous Materials in, on, under, or emanating from or to the Building or
Premises. Landlord has received no written notice of any Building or Premises violation of any
applicable Laws regarding Hazardous Materials. "Environmental Laws" shall mean all federal,
state and local laws, statutes, ordinances, codes, rules, regulations, standards, orders and
requirements pertaining to Hazardous Materials, including the handling and exposure to Hazardous
Materials, and/or environmental conditions in, on, under or about the Premises, the Property, or the
Building, including soil and groundwater conditions, whether now in effect or which may hereafter
come into effect, including but not limited to, the Comprehensive Environmental Response,
Compensation, and Liability Act ("CERCLA") (42 U.S.C. § 9601 et seq.); the Resource
Conservation and Recovery Act ("RCRA") (42 U.S.C. § 6901 et seq.); the California Hazardous
Waste Control Act ("HWCA") (Cal. Health & Safety Code § 25100 et seq.); and the California
Hazardous Substance Account Act ("HSAA") (Cal. Health& Safety Code § 25300 et seq.).
(c) Pursuant to Section 5.3, Landlord shall be responsible for any structural
alterations required to maintain compliance with any Laws, and Tenant shall be responsible for
informing Landlord of the need for such alterations.
7
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
(d) Inspection by Certified Access Specialist. Landlord discloses that the Premises
have not undergone inspection by a Certified Access Specialist as referenced in California Civil
Code Section 1938 subsection(e) of which provides: "A Certified Access Specialist (CASp) can
inspect the subject premises and determine whether the subject premises comply with all of the
applicable construction-related accessibility standards under state law. Although state law does not
require a CASp inspection of the subject premises, the commercial property owner or lessor may
not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the
occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The
parties shall mutually agree on the arrangements for the time and manner of the CASp inspection,
the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to
correct violations of construction-related accessibility standards within the premises." Pursuant to
the foregoing Section 1938(e), Tenant acknowledges and agrees that, if Tenant wishes to have the
Premises inspected by a CASp: (i) Tenant must notify Landlord on or before the date when Tenant
executes this Lease pursuant to the election below; (ii) the inspection will be at Tenant's sole cost
and expense; (iii)the inspection must be scheduled through Landlord and in coordination with the
Building's property manager; (iv) any repairs or modifications necessary to correct any violation of
construction-related accessibility standards that is noted in the CASp report shall be Tenant's
responsibility; and (v) Tenant must provide a copy of the CASp report to Landlord on completion.
By initialing below, Tenant represents that:
Tenant wishes to have a CASp inspection of the Premises Initials:
Tenant hereby waives its right to have a CASp inspection of the Premises Initials: �L
4.4 Siens. Tenant shall not place or permit to be placed any sign that is not in
compliance with the sign ordinance of the Landlord upon the exterior or in the windows of the
Premises. Any sign not constructed in accordance therewith shall be immediately removed by
Tenant and, if said sign is not removed by Tenant within ten (10) days of written notice from
Landlord to Tenant, then Landlord may remove and destroy said sign without Tenant's approval and
without any liability to Tenant.
4.5 Parking and Common Areas. During the term of this Lease and any extension
thereof, Landlord gives to Tenant for the use and benefit of Tenant, its agents, employees,
customers, licensees and subtenants a non-exclusive license in common with Landlord and other
present and future owners and tenants of the Property and their agents, employees, customers,
licensees and subtenants, and others authorized by Landlord to use the automobile parking areas,
roadways, walkways, landscaped areas, service areas, of the Property for ingress, egress and
automobile parking, provided that the condemnation or other taking by any public authority, or sale
in lieu of condemnation, of any or all of such parking and common areas shall not constitute a
violation of this covenant. Nothing herein contained shall be deemed to prevent Landlord from
using or authorizing others to use said parking and common areas.
4.6 Charitable Leases. The provisions of this Section are required by Resolution
No. 14527 of the City Council. Tenant hereby represents and warrants to Landlord that Tenant is
8
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
exempt from federal income taxation pursuant to Internal Revenue Code Section 501(c)(3) and that
Tenant's use of the Premises as specified in Section 1.6 is a tax exempt function. Tenant hereby
acknowledges that the Rent is below fair market rental rates and that the fair market rental value of
the property is $23,000 per month. Prior to the execution of this Lease, Tenant has provided
Landlord with a proposed schedule of programs and events for which the Tenant intends to use the
Premises. On each anniversary of the Commencement Date, or such anniversary date as agreed
upon by Landlord and Tenant, Tenant shall report its intended programming and event schedule for
the upcoming year as outlined in Exhibit "E". If Landlord is not satisfied with the Tenant's
performance, Landlord may terminate this Lease upon eighteen (18) months' advance written
notice to Tenant or increase the Monthly Rent to the fair market rental for the Premises as set forth
in this paragraph. If Landlord elects to terminate this Lease as provided in this Section, Tenant
hereby waives any right to receive any other compensation from Landlord, including, but not
limited to, the value of Tenant's leasehold interest, loss of goodwill, relocation benefits, inverse
condemnation, or the taking of property and Landlord shall have no obligation to pay Tenant
therefor. In the event that Tenant ceases to be a tax-exempt organization or the use is no longer a
tax-exempt function, Rent shall be due at the fair market value from the date Tenant is no longer a
tax-exempt or from the date the use is no longer a tax-exempt function,whichever occurs first.
4.7 Rules and Regulations. Tenant shall faithfully observe and comply with the
rules and regulations that Landlord shall from time to time promulgate and/or modify. The rules
and regulations, if any, are attached hereto as Exhibit "D" ("Rules and Regulations"). Any
amendment or modification of the Rules and Regulations shall be binding upon the Tenant upon
delivery of a copy of such amendment or modification to Tenant. Landlord shall not be responsible
to Tenant for the nonperformance of any said rules and regulations by any other tenants or
occupants. The Rules and Regulations shall apply and be enforced as to all tenants in the Premises
on a uniform basis. Notwithstanding the preceding paragraph, if Landlord undertakes the rental of
the Premises to a third party group outside the scope of this Lease, Tenant shall not bear
responsibility for the compliance with the Landlord's rules and regulations by the group.
5.0 ALTERATIONS,MAINTENANCE AND REPAIRS.
5.1 Alterations and Fixtures. Tenant shall not make, or suffer to be made, any
alterations to the Premises, or any part thereof, outside the terms of this lease, without the prior
written consent of Landlord. Any alterations to the Premises, except movable furniture and trade
fixtures, shall become at once a part of the realty and shall at the expiration or earlier termination of
this Lease belong to Landlord. The following trade fixtures shall remain the personal property of
Tenant: lighting instruments, control boards, sound boards, microphones, recording and playback
equipment, closed circuit communications systems, fly/pully/rail/curtain system, ticketing system,
and office equipment. Tenant shall not in any event make any changes to the exterior of the
Premises, without the prior written consent of Landlord. Any such alterations shall be in
conformance with the requirements of all municipal, state, federal, and other governmental
authorities, including requirements pertaining to the health, welfare or safety of employees or the
public and in conformance with reasonable rules and regulations of Landlord. Any removal of
alterations or furniture and trade fixtures shall be at Tenant's expense and accomplished in a good
9
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
and workmanlike manner. Any damage occasioned by such removal shall be repaired at Tenant's
expense-so that the Premises can be surrendered in a good, clean and sanitary condition as required
by Section 5.3 hereof. Any and all fixtures and appurtenances installed by Tenant shall conform
with the requirements of all municipal, state, federal, and governmental authorities, including
requirements pertaining to the health, welfare, or safety of employees or the public. Upon
completion of construction of the alterations, Tenant shall submit to Landlord evidence satisfactory
to Landlord of the cost of said alterations ("Improvement Costs").
5.2 Maintenance. Tenant shall be responsible for the minor cosmetic
maintenance of the Premises, such as vacuuming, window cleaning, mopping, painting, light bulb
changes, regular deep cleaning of the Premises, and small drywall repairs. In addition, Tenant
shall periodically sweep and clean the sidewalks adjacent to the Premises, in order to keep the
sidewalks in a clean, safe and neat condition.
5.3 Repair. Landlord shall be responsible for any and all repairs to the
Premises, including, without limitation, structural repairs, the electrical system, broken windows,
plumbing repairs, repairs to the HVAC system, the roof and any exterior improvements. Tenant
hereby waives all rights to make repairs at the expense of Landlord, and Tenant hereby waives all
rights provided for by the Civil Code of the State of California to make said repairs. By entering
into the Premises, Tenant shall be deemed to have accepted the Premises as being in tenantable
order, condition and repair, and Tenant agrees on the last day of said term or sooner termination of
this Lease to surrender the Premises with appurtenances, in the same condition as when received
and in a tenantable condition, reasonable use and wear thereof and damage by fire, acts of God or
by the elements excepted. Upon Tenant's possession of the Premises, Tenant shall be deemed to
have accepted the Premises as being in tenantable condition and repair. Tenant agrees that it will
not, nor will it authorize any person to, go onto the roof of the building of which the Premises are a
part without the prior written consent of Landlord. Landlord shall respond, within a reasonable
time period, to Tenant's non-emergency requests for repairs. Landlord shall respond 24 hours a
day, 7 days a week for emergency repairs to the Premises. For purposes of this section,
"emergency" shall mean a sudden, unexpected occurrence that poses a clear and imminent danger,
requiring immediate action to prevent or mitigate the loss or impairment of life, health, or property.
5.4 Free from Liens. Tenant shall keep the Premises free from any liens arising
out of any work performed, material furnished, or obligation incurred by Tenant or alleged to have
been incurred by Tenant.
5.5 Additional Consideration for Lease. As additional consideration for renting
the Premises, Tenant agrees to perform the Property management.obligations in accordance with
Exhibit "E" attached hereto.
6.0 INSURANCE AND INDEMNIFICATION.
6.1 Insurance Provided by Landlord. Landlord shall maintain fire and extended
coverage insurance throughout the term of this Lease in an amount equal to at least ninety percent
10
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3 -
(90%) of the replacement value of the Tenant's building on the Premises, together with such other
insurance, coverages and endorsements as may be required by Landlord's lender, or as Landlord
may determine in its sole discretion. Tenant hereby waives any right of recovery from Landlord,
its officers and employees, and Landlord hereby waives any right of loss or damage (including
consequential loss) resulting from any of the perils insured against as a result of said insurance.
Tenant agrees to pay to Landlord its pro rata share of the cost of said insurance to be determined by
the relationship that the gross floor area of the Premises bears to the total gross leasable floor area
of the building or buildings for which such policy relates.
6.2 Insurance Provided by Tenant.
(a) Tenant to Provide Personal Property Insurance. Tenant, at its expense,
shall maintain fire and extended coverage insurance written on a per occurrence basis on
its trade fixtures, equipment, personal property and inventory within the Premises from
loss or damage to the extent of their full replacement value.
(b) Tenant to Provide Liability Insurance. During the entire term of this
Lease, the Tenant shall, at the Tenants sole cost and expense, but for the mutual benefit of
Landlord and. Tenant, maintain comprehensive general liability insurance insuring against
claims for bodily injury, death or property damage occurring in, upon or about the
Premises and on any sidewalks directly adjacent to the Premises written on a per
occurrence basis in a combined single limit of ONE MILLION DOLLARS
($1,000,000.00) for bodily injury, death, and property damage and TWO MILLION
DOLLARS in the aggregate, however, if Landlord so elects Landlord may provide such
insurance and, in such event, Tenant agrees to pay its pro rata share of the cost of said
insurance on the same basis as provided in Section 6.1 above.
(c) Tenant to Provide Worker's Compensation Insurance. If applicable,
Tenant shall, at the Tenants sole cost and expense, maintain a .policy of worker's
compensation insurance in an amount as will fully comply with the laws of the State of
California and which shall indemnify, insure and provide legal defense for both the Tenant
and the Landlord against any loss, claim or damage arising from any injuries or
occupational diseases occurring to any worker employed by or any persons retained by the
Tenant in the course of conducting Tenant's business in the Premises.
(d) General Provisions Applicable to Tenant's Insurance. All of the
policies of insurance required to be procured by Tenant pursuant to this Section 6.2 shall
be primary insurance and shall name the Landlord, its officers, employees and agents as
additional insureds. The insurers shall waive all rights of contribution they may have
against the Landlord, its officers, employees and agents and their respective insurers. All
of said policies of insurance shall provide that said insurance may not be amended or
cancelled without providing 30 days prior written notice by registered mail to the
Landlord. Prior to the Commencement Date or such earlier date as Tenant takes
possession of the Premises for any purpose; and at least 30 days prior to the expiration of
any insurance policy, Tenant shall provide Landlord with certificates of insurance or
11
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
appropriate insurance binders evidencing the above insurance coverages written by
insurance companies acceptable to Landlord, licensed to do business in the state where the
Premises are located and rated A: VII or better by Bests Insurance Guide. In the event the
Risk Manager of Landlord ("Risk Manager") determines that (i) the Tenant's activities in
the Premises creates an increased or decreased risk of loss to the Landlord, (ii) greater
insurance coverage is required due to the passage of time, or (iii) changes in the industry
require different coverages be obtained, Tenant agrees that the minimum limits of any
insurance policy required to be obtained by Tenant may be changed accordingly upon
receipt of written notice from the Risk Manager, provided that Tenant shall have the right
to appeal a determination of increased coverage by the Risk Manager to the City Council
of Landlord within ten (10) days of receipt of notice from the Risk Manager. Landlord
and Tenant hereby waive any rights each may have against the other on account of any
loss or damage occasioned by property damage to the Premises, its contents, or Tenants
trade fixtures, equipment personal property or inventory arising from any risk generally
covered by insurance against the perils of fire, extended coverage, vandalism, malicious
mischief, theft, sprinkler damage, and earthquake sprinkler leakage. Each of the parties,
on behalf of their respective insurance companies insuring such property of either
Landlord or Tenant against such loss, waives any right of subrogation that it may have
against the other. The foregoing waivers of subrogation shall be operative only so long as
available in California and provided further that no policy is invalidated thereby.
6.3 Indemnification of Landlord. Tenant, as a material part of the consideration
to be rendered to Landlord under this Lease, hereby waives all claims against Landlord for damage
to equipment or other personal property, trade fixtures, leasehold improvements, goods, wares,
inventory and merchandise, in, upon or about the Premises and for injuries to persons in or about
the Premises, from any cause arising at any time. Tenant agrees to indemnify the Landlord, its
elected officials, officers, agents, public officials, volunteers, and employees against, and will hold
and save them and each of them harmless from, any and all actions, suits, claims, damages to
persons or property, losses, costs, penalties, obligations, errors, omissions or liabilities, (herein
"claims or liabilities") that may be asserted or claimed by any person, firm or entity arising out of
or in connection with the performance of the work, operations or activities of Tenant, its agents,
employees, subcontractors, or invitees, provided for herein, or arising from the use of the Premises
or the common area by Tenant or its employees and customers,or arising from the failure of Tenant
to keep the Premises in ,good condition, as herein provided, or arising from the negligent acts or
omissions of Tenant hereunder, or arising from Tenant's negligent performance of or failure to
perform any term, provision covenant or condition of this Lease, whether or not there is concurrent
passive or active negligence on the part of the Landlord, its officers, agents, public officials,
volunteers, or employees but excluding such claims or liabilities arising from the sole negligence or
willful misconduct of the Landlord, its officers, agents, public officials, volunteers, or employees,
who are directly responsible to the Landlord, and in connection therewith:
(a) Tenant will defend any action or actions filed in connection with any of
said claims or liabilities and will pay all costs and expenses, including legal costs and
attorneys' fees incurred in connection therewith;
12
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
(b) Tenant will promptly pay any judgment rendered against the Landlord,
its officers, agents, public officials, volunteers, or employees for any such claims or
liabilities arising out of or in connection with the negligent performance of or failure to
perform such work, operations or activities of Tenant hereunder, and Tenant agrees to save
and hold the Landlord, its officers, agents, public officials, volunteers, and employees
harmless therefrom;
(c) In the event the Landlord, its elected officials, officers, agents. public officials,
volunteers, or employees is made a party to any action or proceeding filed or prosecuted against
Tenant for such damages or other claims arising out of or in connection with the negligent
performance of or failure to perform the work, operation or activities of Tenant hereunder, Tenant
agrees to pay to the Landlord, its officers, agents, public officials, volunteers, or employees, any
and all costs and expenses incurred by the Landlord, its officers, agents. public officials, volunteers,
or employees in such action or proceeding, including but not limited to, legal costs and attorneys'
fees
7.0 ABANDONMENT AND SURRENDER.
7.1 Abandonment. Tenant shall not vacate or abandon the Premises at any time
during the term of this Lease, except upon providing Landlord eighteen (18) months' prior written
notice. If Tenant shall abandon, vacate or surrender the Premises without said notice or be
dispossessed by process of law, or otherwise, any personal property belonging to Tenant and left on
the Premises shall be deemed to be abandoned, at the option of Landlord, except such property as
may be mortgaged to Landlord.
7.2 Surrender of Lease. The voluntary or other surrender of this Lease by Tenant
or a mutual cancellation thereof, shall not work a merger, and shall, at the option of Landlord,
terminate all or any existing subleases or sub-tenancies, or may, at the option of Landlord, operate
as an assignment to it of any or all of such subleases or sub-tenancies.
8.0 DAMAGE AND DESTRUCTION OF PREMISES. In the event of(a) partial or
total destruction of the Premises during the term of this Lease, which requires repairs to the
Premises, or(b)the Premises being declared unsafe or unfit for occupancy by any authorized public
authority for any reason other than Tenant's act, use or occupation, which declaration requires
repairs to the Premises, Landlord shall, at its option, make such repairs. Any partial or total
destruction of the Premises (including any destruction necessary in order to make repairs required
by any declaration made by any public authority) may, at Tenant's election, annul or void this
Lease.
9.0 ASSIGNMENT AND SUBLETTING. Tenant shall not assign this Lease or
sublet the Premises or any interest therein, without the prior written consent of Landlord, which
consent shall not be unreasonably withheld. For purposes of this Lease, an assignment shall be
deemed to include the transfer to any person or group of persons acting in concert of more than
13
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
twenty five percent (25%) of the present ownership and/or control of Tenant, taking all transfers
into account on a cumulative basis. Landlord may withhold its consent to an assignment or
sublease to a proposed assignee or sub-lessee, and Tenant agrees that Landlord shall not be
unreasonable for doing so, unless all the following criteria are met: (a) The proposed assignee's or
sub-lessee's general financial condition, including liquidity and net worth, verified by audited
financial statements prepared by a Certified Public Accountant in conformity with Generally
Accepted Accounting Principles is equal to or greater than that of Tenant; (b)the proposed assignee
or sub-lessee has a demonstrated merchandising capability equal to or greater than that of Tenant as
to the use for which the Premises are leased; (c) the proposed assignee or sub-lessee is morally and
financially responsible; (d) the failure of tenant's use of the Premises to fit the business plan of
Landlord to promote tourism to the City of Palm Springs; and (e) the proposed assignee or
subtenant is exempt from federal income taxation pursuant to Internal Revenue Code Sections
501(c)(1) and/or 501(c)(3) and the proposed assignee's or subtenant's proposed use of the Premises
is a tax exempt function. Any such assignment shall be subject to all of the terms and conditions of
this Lease and the proposed assignee shall assume the obligations of Tenant under this Lease in
writing in form satisfactory to Landlord. The proposed assignee shall simultaneously provide to
Landlord an estoppel certificate in the form described in Exhibit "F" hereafter. Consent by
Landlord to one assignment, subletting, occupation or use by another person shall not be deemed to
be consent to any subsequent assignment, subletting, occupation or use by another person. Any
assignment or subletting without the prior written consent of Landlord shall be void, shall
constitute a material breach of this Lease, and shall, at the option of Landlord, terminate this Lease.
Neither this Lease nor any interest therein shall be assignable as to the interest of Tenant by
operation of law.
Landlord shall be under no obligation to consider a request for Landlord's consent
to an assignment until Tenant shall have submitted in writing to Landlord a request for Landlord's
consent to such assignment together with audited financial statements of Tenant and the proposed
assignee, a history of the proposed assignee's business experience and such other information as
required by Landlord to verify that the criteria for assignment, as set forth herein are met. If
Landlord approves such assignment, Tenant shall pay to Landlord one-half (1/2) of any
consideration received by Tenant for such assignment. In addition, if Landlord determines that the
Monthly Rent payable to Landlord under this Lease is less than the fair market rental value, as
determined by Landlord, Landlord shall have the right to condition its approval to an assignment
or subletting on the increase of Monthly Rent to the fair market rental value.
10.0 CURE AND REMEDIES.
10.1 Default by Tenant. In addition to the defaults described in Section 9.0
hereinabove, the occurrence of any one or more of the following events shall constitute a default
and breach of this Lease by Tenant: (a) the failure to pay any rent or other payment required
hereunder to or on behalf of Landlord more than three (3) days after written notice from Landlord
to Tenant that Tenant has failed to pay rent when due; (b) the vacation or abandonment of the
Premises by Tenant. Landlord may, at its discretion, allow Tenant to cure any defaults within sixty
(60) days or any other agreed upon terms (in writing) without waiving any future right to terminate
14
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
the lease for any other breach of the lease.
Notwithstanding any of the foregoing, the breach of this Lease by Tenant, or an
abandonment of the Premises by Tenant, shall not constitute a termination of this Lease, or of
Tenant's right of possession hereunder, unless and until Landlord elects to do so, and until such
time Landlord shall have the right to enforce all of its rights and remedies under this Lease,
including the right to recover rent, and all other payments to be made by Tenant hereunder, as
they become due. Failure of Landlord to terminate this Lease shall not prevent Landlord from
later terminating this Lease or constitute a waiver of Landlord's right to do so.
10.2 No Waiver. Acceptance of rental hereunder shall not be deemed a waiver
of any default or a waiver of any of Landlord's remedies.
10.3 Landlord's Right to Terminate. In the event of any such default by Tenant, in
addition to any other remedies available to Landlord at law or in equity, Landlord shall have the
immediate option to terminate this Lease and all rights of Tenant hereunder. In the event that
Landlord shall elect to so terminate this Lease then Landlord may recover from Tenant:
(a) the worth at the time of award of any unpaid rent which had been earned
at the time of such termination; plus
(b) the worth at the time of award of the amount by which the unpaid rent
which would have been reasonably earned after termination until the time of
award exceeds the amount of such rental loss that Tenant proves could have
been reasonably avoided; plus
(c) the worth at the time of award of the amount by which the unpaid rent for
the balance of the term after the time of award exceeds the amount of such
rental loss that Tenant proves could be reasonably avoided; plus
(d) any other amount necessary to compensate Landlord for all the detriment
proximately caused by Tenant's failure to perform its obligations under this
Lease or which in the ordinary course of things would be likely to result
therefrom.
As used in Subparagraphs 10.3 (a) and (b) above, the "worth at the time of
award" is computed by allowing interest at the maximum rate permitted by law per annum. As used
in Subparagraph 10.3(c) above, the "worth at the time of award" is computed by discounting such
amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus
one percent (1%).
10.4 Landlord's Re-Entry In the event of any such default by Tenant, Landlord
shall also have the right, with or without terminating this Lease, to re-enter the
Premises and remove all persons and property from the Premises; such property may
be removed and stored in a public warehouse or elsewhere at the cost of and for the
15
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
account of Tenant. No re-entry or taking possession of the Premises by Landlord
pursuant to this Subparagraph 10.4 shall be construed as an election to terminate this
Lease unless a written notice of such intention be given to Tenant or unless the
termination thereof be decreed by a court of competent jurisdiction.
10.5 No Termination of Lease. Landlord shall also have the remedy described in
California Civil Code Section 1951.4 (i.e., the right to continue the Lease in effect
and recover rent as it becomes due). In such event, Landlord may continue this
Lease in full force and effect, and this Lease will continue in effect as long as
Landlord does not terminate Tenant's right to possession, and Landlord shall have the
right to collect rent when due. During the period Tenant is in default, Landlord can
enter the Premises and relet them, or any part of them, to third parties for Tenant's
account. Tenant shall be liable immediately to Landlord for all costs Landlord incurs
in reletting the Premises, including, without limitation, brokers' commissions,
expenses of remodeling the Premises required by the reletting, and like costs.
Reletting can be for a period shorter or longer than the remaining term of this Lease.
Tenant shall pay to Landlord the rent due under this Lease on the dates the rent is
due, less the rent Landlord receives from any reletting. No act by Landlord allowed
by this Subparagraph 10.5 shall terminate this Lease unless Landlord notifies Tenant
that Landlord elects to terminate this Lease.
If Landlord elects to relet the Premises as provided in this Subparagraph 10.4,
rent that Landlord receives from reletting shall be applied to the payment of,
(a) First, any indebtedness from Tenant to Landlord other than rent due from
Tenant;
(b) Second, all costs, including for maintenance, incurred by Landlord in
reletting;
(c) Third, rent due and unpaid under this Lease. After deducting the
payments referred to in this Paragraph, any sum remaining from the rent
Landlord receives from reletting shall be held by Landlord and applied in
payment of future rent as rent becomes due under this Lease. In no event
shall Tenant be entitled to any excess rent received by Landlord. If, on the
date rent is due under this Lease, the rent received from the reletting is less
than the rent due on that date, Tenant shall pay to Landlord, in addition to the
remaining rent due, all costs, including for maintenance, Landlord incurred in
reletting that remain after applying the rent received from the reletting as
provided in this Subparagraph 25(d).
10.6 Landlord's Rights, Options and Remedies. All rights, options and remedies
of Landlord contained in this Lease shall be construed and held to be cumulative, and
no one of them shall be exclusive of the other, and Landlord shall have the right to
pursue any one or all of such remedies or any other remedy or relief which may be
16
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
provided by law or in equity, whether or not stated in this Lease. No waiver of any
default of Tenant hereunder shall be implied from any acceptance by Landlord of any
rent or other payments due hereunder or any omission by Landlord to take any action
on account of such default if such default persists or is repeated. Any waiver must be
in writing and such express waiver shall not affect defaults other than as specified in
the waiver. The consent or approval of Landlord to or of any act by Tenant requiring
Landlord's consent or approval shall not be deemed to waive or render unnecessary
Landlord's consent or approval to or of any subsequent similar acts by Tenant.
10.7 Meaning of"Rent" As used in this Lease, except as expressly stated herein,
the term "rent" shall refer to Monthly Rental and any other sum required to be paid to
Landlord under this Lease.
11.0 MISCELLANEOUS.
11.1 Reservation of Right to Modify Property. Landlord hereby reserves the right
(but not the obligation) to renovate, modernize, rehabilitate, expand, reduce, reconfigure, enclose
and/or otherwise alter all or any portion of the Premises (collectively "Modifications"), in such
manner and at such time or times,throughout the term of this Lease, as Landlord may, in its sole and
absolute discretion, deem to be in the best interests of the Property. In connection with any and all
such Modifications, Landlord may enter the Premises to the extent reasonably required by Landlord
to pursue and complete such Modifications. In addition, Landlord may temporarily close portions of
the parking and common areas and cause temporary obstructions in connection with any
Modifications. Landlord will use reasonable efforts to avoid impeding on Tenant's regular business
and patrons. Notice for such modifications will be provided to Tenant in writing at least thirty (30)
days in advance. Tenant agrees that under no circumstances shall the Modifications as to any portion
of the Property or the construction activity that takes place in the course of making the
Modifications, or any aspect thereof, including Landlord's entry into the Premises, constitute an
eviction or partial eviction of Tenant or a breach of Tenant's right to quiet enjoyment or of any other
provision of this Lease.
11.2 Entry and Inspection. Tenant shall permit Landlord and his agents to enter
into and upon the Premises at all reasonable times for the purpose of inspecting the same for the
purpose of maintaining or repairing the Premises as required by the terms of this Lease or for the
purpose of posting notices of non-liability for alterations, additions or repairs, or for the purpose of
placing upon the property in which the Premises are located any usual or ordinary "For Sale" signs
or any signs for public safety as determined by Landlord. Landlord shall be permitted to do any of
the above without any rebate of rent.
11.3 Estoppel Certificate. If, as a result of a proposed sale, assignment, or
hypothecation of the Premises or the land thereunder by Landlord, or at any other time, an estoppel
certificate shall be requested of Tenant, Tenant agrees, within ten (10) days thereafter, to deliver
such estoppel certificate in the form attached hereto as Exhibit "F" addressed to any existing or
proposed mortgagee or proposed purchaser, and to the Landlord. Tenant shall be liable for any loss
17
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
or liability resulting from any incorrect information certified, and such mortgagee and purchaser
shall have the right to rely on such estoppel certificate and financial statement.
11.4 Jurisdiction, Venue and Mediation. The parties hereto agree that the State of
California is the proper jurisdiction for litigation of any matters relating to this Lease, and service
mailed to the address of tenants set forth herein shall be adequate service for such litigation. The
parties further agree that Riverside County, California is the proper place for venue as to any such
litigation and Tenant agrees to submit to the personal jurisdiction of such court in the event of such
litigation. Prior to any claim or litigation for breach of this agreement, Landlord and Tenant agree
to non-binding mediation and agree to split the cost for such mediation.
11.5 Force Maieure. If either party hereto shall be delayed or prevented from the
performance of any act ,including, but not limited to reason of acts of God, strikes, lockouts, labor
troubles, inability to procure materials, usually severe weather, fires, earthquakes, floods,
epidemics, quarantine restrictions, riots, strikes, freight embargos, wars, and/or acts of any
government agency, restrictive governmental laws or regulations or other cause without fault and
beyond the control of the party obligated (financial inability excepted), performance of such act
shall be excused for the period of the delay and the period for the performance of any such act shall
be extended for a period equivalent to the period of such delay as determined by the Landlord,
provided such party provides the other party written notice of such event within ten (10) days of the
commencement of the prompt payment of any rental or other charge required of Tenant hereunder
except as may be expressly provided elsewhere in this Lease. Upon receipt of written notice of
delay from the Tenant, Landlord shall ascertain the facts and the extent of delay, and extend the
time for performing the acts required for the period of the enforced delay when and if in the
judgment of the Landlord such delay is justified. The Landlord's determination shall be final and
conclusive upon the Parties to this Lease.
11.6 Partial Invalidity. If any term, covenant, condition or provision of this Lease
is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of
the provisions hereof shall remain in full force and effect and shall in no way be affected, impaired
or invalidated thereof.
11.7 Successors in Interest. The covenants herein contained shall, subject to the
provisions as to assignment, apply to and bind the heirs, successors, executors, administrators and
assigns of all the parties hereto; and all of the parties hereto shall be jointly and severally liable
hereunder.
11.8 No Oral Agreements. This (i) Lease covers in full each and every agreement
of every kind or nature whatsoever between the parties hereto concerning this Lease, (ii) supersedes
any and all previous obligations, agreements and understandings, if any, between the parties, oral or
written, and (iii) merges all preliminary negotiations and agreements of whatsoever kind or nature
herein. Tenant acknowledges that no representations or warranties of any kind or nature not
specifically set forth herein have been made by Landlord or its agents or representatives.
18
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
11.9 Authority. In the event that Tenant is a corporation or a partnership, each
individual executing this Lease on behalf of said corporation or said partnership, as the case may
be, represents and warrants that he or she is duly authorized to execute and deliver this Lease on
behalf of said corporation or partnership, in accordance with a duly adopted resolution of the Board
of Directors, if a corporation, or in accordance with the Partnership Agreement if a partnership, and
that this Lease is binding upon said corporation or partnership in accordance with its terms. Tenant
represents and warrants to Landlord that the entering into this Lease does not violate any provisions
of any other agreement to which Tenant is bound.
11.10 Relationship of Parties. The relationship of the parties hereto is that of
Landlord and Tenant, and it is expressly understood and agreed that Landlord does not in any way
or for any purpose become a partner of Tenant in the conduct of Tenant's business or otherwise, or
a joint venture with Tenant.
11.11 Covenant Against Discrimination. In connection with its performance under
this Agreement, Contractor shall not discriminate against any employee or applicant for
employment because of actual or perceived race, religion, color, sex, age, marital status, ancestry,
national origin (i.e., place of origin, immigration status, cultural or linguistic characteristics, or
ethnicity), sexual orientation, gender identity, gender expression, physical or mental disability, or
medical condition (each a"prohibited basis"). Contractor shall ensure that applicants are employed,
and that employees are treated during their employment, without regard to any prohibited basis. As
a condition precedent to City's lawful capacity to enter this Agreement, and in executing this
Agreement, Contractor certifies that its actions and omissions hereunder shall not incorporate any
discrimination arising from or related to any prohibited basis in any Contractor activity, including
but not limited to the following: employment, upgrading, demotion or transfer; recruitment or
recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and
selection for training, including apprenticeship; and further, that Contractor is in full compliance
with the provisions of Palm Springs Municipal Code Section 7.09.040, including without limitation
the provision of benefits, relating to non-discrimination in city contracting.
11.12 Notices. Wherever in this Lease it shall be required or permitted that notice
and demand be given or served by either party to this Lease to or on the other, such notice or
demand shall be given or served in writing and shall not be deemed to have been duly given or
served unless in writing, and personally served or forwarded by certified mail, postage prepaid,
addressed, if to Landlord, as specified in Section 1.7. Either party may change the address set
forth herein by written notice by certified mail to the other. Any notice or demand given by
certified mail shall be effective one (1) day subsequent to mailing.
11.13 Waiver. No delay or omission in the exercise of any right or remedy by a
non-defaulting party shall impair such right or remedy or be construed as a waiver. A party's
consent to or approval of any act by the other party requiring the party's consent or approval shall
not be deemed to waive or render unnecessary the other party's consent to or approval of any
subsequent act. Any waiver by either party of any default must be in writing and shall not be a
waiver of any other default concerning the same or any other provision of this Lease.
19
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
11.14 Exhibits and Addenda. The Exhibits and any other attachments to this
Lease are made a part hereof as if fully set forth herein.
11.15 Conflict of Interest. Tenant acknowledges that no officer or employee of the
Landlord has or shall have any direct or indirect financial interest in this Lease nor shall Tenant
enter into any agreement of any kind with any such officer or employee during the term of this
Lease and for one year thereafter. Tenant warrants that Tenant has not paid or given, and will not
pay or give, any third party any money or other consideration in exchange for obtaining this Lease.
11.16 California Labor Code Requirements. Tenant is aware of the requirements of
California Labor Code Sections 1720 et seq. and 1770 et seq., which require the payment of
prevailing wage rates and the performance of other requirements on certain "public works" and
"maintenance" projects. If Tenant performs any "maintenance" with regard to the Premises, and if
the total compensation is more than $15,000 or more, Tenant agrees to fully comply with such
Prevailing Wage Laws, if applicable. Tenant shall defend, indemnify and hold the Landlord, its
elected officials, officers, employees and agents free and harmless from any claims, liabilities, costs,
penalties, or interest arising out of any failure or alleged failure to comply with the Prevailing Wage
Laws. It is the intent of the parties to effectuate the requirements of sections 1771, 1774, 1775,
1776, 1777.5, 1813, and 1815 of the Labor Code within this Agreement, and Tenant shall therefore
comply with such Labor Code sections to fullest extent required by law. It shall be mandatory upon
the Tenant and all of Tenant's contractors to comply with all California Labor Code provisions,
which include but are not limited to prevailing wages, employment of apprentices, hours of labor
and debarment of contractors and subcontractors.
11.17 Attorneys' Fees. In the event that any action or proceeding is commenced to
regarding this Lease, the prevailing party in such action or proceeding, in addition to all other relief
to which it may be entitled, shall be entitled to recover from the other party the prevailing party's
costs of suit and reasonable attorneys' fees. The prevailing party shall be as determined by the court
in accordance with Code of Civil Procedure Section 1032. The attorney's costs and expert fees
recoverable pursuant to this Section include, without limitation, attorney's costs and expert fees
incurred on appeal and those incurred in enforcing any judgment rendered. Attorney's costs and
fees may be recovered as an element of costs in the underlying action or proceeding or in a separate
recovery action.
[SIGNATURES ON NEXT PAGE]
20
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
IN WITNESS WHEREOF, the parties have duly executed this Lease together with the
herein referred to Exhibits which are attached hereto, on the day and year first above written in
Palm Springs, California.
"City"
ATTEST: CITY OF PALM SPRINGS, a municipal
oration
By: B l
City Ce
Its:
APPROVED AS TO FORM:
1
Cit Att rn y
"Tenant"
PALM CANYON THEATRE INC., a
California non-profit 501(c)(3) corporation
By:
Its: 1%,AU ef- Qv-K sTtr_ 'I), ^'c&L,
J ISao..i-cQ. meu4vg
By: p \4�mo, p
Its: &y-
21 APPROM BY CRY COUNCIL
Palm Canyon Theatre Lease LIN IV ILL-h
538 North Palm Canyon Drive 444
55575.18175\32359304.3
EXHIBIT "A"
LEGAL DESCRIPTION OF THE PREMISES
That certain property in the City of Palm Springs, County of Riverside, State of
California, being generally the property known as Frances Stevens Park,
described as follows:
That portion of the Southeast quarter of the Southeast quarter of Section 10,
Township 4 South, Range 4 East, San Bernardino Base and meridian, described as
follows:
Beginning at a point on the south line of said Section 10, Township 4 South,
Range 4 East, San Bernardino Base and Meridian, 30 feet West of the Southeast
corner thereof; thence South 89' 42' West on said South line, 297.40 feet; thence
North on the East line of a public highway 550.4 feet; thence North 89' 42' East
296.75 feet to a point distance 30 feet, measured at a right angle, from the East
line of said Section 10; thence South 0° 2' 30" East and parallel with said East
line, 550.4 feet to the point of beginning.
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
A-1
55575.18175\32359304.3
EXHIBIT "B"
PLOT PLAN OF DEMISED PREMISES
NPALM CANYON�R 0 !^�'
1 6y�9NINDIANEY U,IIJ
'8]I N PAUA CANYON DR
EGaIJ.YIAVAUAONi2
550 N Palm`CanyDn Dr.
1
6I5 NFA MCANYON OR �ki Deseft[1tt Ginter- �,.. ' t
�VI
1 ,
} __
I
I
srzxl wouN�cANYON aR \
i 3
i 538 N.Palm Canyon°Dr:-
Palm Canyon Theatre
55 NII NOUN'CY, R
615NPACMCANYDN OR ," : I i } 6W NINDIAN CYND
n {1- f 580N OtA4O NOR C
if , 2� NO'ANE INOIAIv'C�Y4 DR:f
t I{zKI _
....._.__ f W:..�.._......
—^"-':^`"'"" E AIP.10 N➢ E ALEA RO
W AlEJO NO
414 N PAW CANYON OR
1 Lcmy GndeV 4 I `+
09lNPALM CANYON DR I 3 ersry,Hyve Gt m 6e�d a.hdro Co' .r�er Kive d B e uer LendM ner£v¢N Rrt�
B-1
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
55575.18175\32359304.3
EXHIBIT"C"
INTENTIONALLY LEFT BLANK
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
C-1
55575.18175\32359304.3
EXHIBIT M
RULES AND REGULATIONS
1. All of Tenant's solid waste shall be removed to central trash bins located in the
Property, per section 3.8(b) of this Agreement.
2. No radio or television or other similar device audible outside the Premises shall be
installed without obtaining in each instance the written consent of Landlord. No
aerial shall be erected on the roof or exterior walls of the Premises or on the grounds
of the Property without first obtaining in each instance the written consent of
Landlord which consent shall not be unreasonably withheld or delayed. Any aerial so
installed without such written consent shall be subject to removal without notice at
any time.
3. No loudspeakers, televisions, phonographs, radios or other devices shall be used in a
manner so as to be heard or seen outside of the Premises without first obtaining in
each instance written consent of Landlord.
4. The outside sidewalks and loading areas immediately adjoining the Premises shall be
kept clean and free from dirt and rubbish by Tenant to the reasonable satisfaction of
Landlord, and Tenant shall not place or permit any obstructions or merchandise in
such areas, except to the extent specifically permitted by the provisions of Tenant's
Lease.
5. Tenant shall not burn any trash or garbage of any kind in or about the Premises or the
Property generally.
6. Tenant will not allow animals, except service animals or those animals used in theatre
productions, in, about or upon the Premises (except within the immediate vicinity of
the Palm Canyon Theatre Box Office).
7. Tenant shall not use, and shall not allow anyone else to use, the Premises as a
habitation. Such prohibition shall include, without limitation, sleeping, eating or
bathing except for cots provided in the Actors Equity dressing rooms solely for use by
performers and required under the Equity contract.
8. Tenant shall not place any rubbish or other matter outside any building within the
Property, except in such containers as are authorized from time to time by Landlord.
9. Tenant shall provide for professional janitorial cleaning of the men's and women's
restrooms prior to performances in the auditorium, and at other times as may be
necessary by heavy use.
D-1
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
EXHIBIT"E"
TENANT'S PROPERTY MANAGEMENT OBLIGATIONS
As additional consideration for this Lease, Tenant agrees to provide a "non-profit professional
equity/non-equity theatre" operation each year during the Lease term consisting of a minimum of
eight (8) professional quality indoor theatre productions on the Premises per season during the
months of October through May with an average of ten (10) performances per month, except
during the Palm Springs International Film Festival.
Tenant agrees to the exclusive use of the Premises for the Palm Springs International Film
Festival ("Film Festival") for approximately fifteen (15) days each January, and the Palm
Springs International Short Film Festival ("Short Film Festival") for approximately eight (8)
days in June each year, and in addition, for film screenings ("Screenings") by the Palm Springs
International Film Society, a California nonprofit corporation ("Film Society") not less than
three (3) evenings per month, scheduled a minimum of thirty (30) days in advance, on Mondays,
Tuesdays, or Wednesdays, or other such time as Tenant is not using the theater for live
performances or rehearsal. Tenant shall coordinate a minimum of 30 days in advance with Film
Festival regarding scheduling of Film Festival and Short Film Festival. Tenant may conduct
rehearsals in classroom spaces on the wings of the property during film screenings and Film
Festival events provided that such use will not interfere with the exclusive use of the theatre
(including auditorium, and stage) by Film Festival and its patrons during such events.
In consideration of the substantial contributions and improvements to the Theatre previously
made by the Film Festival and hereby acknowledged by the City, no rental fee is to be charged
by the Tenant to the Film Festival or Film Society for use of the Premises.
Tenant also agrees to allow the City exclusive use of the Premises one (1) evening per month for
special events by the City or performances by other organizations as specified by the City's
Special Events Coordinator scheduled a minimum of thirty (30) days in advance, at such time as
Tenant is not using the theater for live performances or rehearsals.
Tenant will reinvest all "net annual income" generated from its business and productions on the
Premises into facility improvements and/or program enhancements directly related to the
Premises. "Net Annual Income" shall mean the excess of(i) all money received during a specific
calendar year as a result of the operation of the theater and business on the Premises and the sale
of goods and services at the Premises determined in accordance with generally accepted
accounting principles consistently applied minus (ii) all operating expense directly related to the
Premises determined under generally accepted accounting principles consistently applied. In no
event shall Tenant be required to reinvest earnings in the project in violation of its nonprofit
status. The City may review and audit the Tenant's books and records upon reasonable notice to
assure compliance with this paragraph.
Tenant will give priority to Palm Springs residents where possible in retaining actors, designers,
E-1
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
technical staff and skilled/non-skilled labor where qualifications and experience are equivalent to
those of other non-Palm Springs residents. The Tenant will also initiate several theatre-related
educational outreach programs during the Lease term including, but not limited to, an intern
program; children's theatre and workshops.
The Tenant will strive to involve local art groups as Palm Canyon Theatre resource groups for
the creation of stage sets and related artwork for theatre productions, as well to provide pre- and
post-performance artist exhibits for the enjoyment of theatre patrons.
Tenant also agrees to work with the City and other non-profit arts groups in order to develop a
well-coordinated annual calendar of productions and special events at the Frances Stevens
Festival Park in order to avoid an overly intensive use of the facilities and the creation of
vehicular parking and traffic congestion problems.
Tenant will submit an annual report detailing its programming and number of participants.
Annual Report shall provide the following information:
Intended Programming and Schedule of Upcoming Year
Documentation of 501c3 non-profit status
Breakdown of Prior Year Revenue
• Ticket Sales
• Grants
• Donation
• Totallncome/Revenue
Cash Reserve Balance
Accounting of funds spent on building maintenance
E-2
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
EXHIBIT "F"
ESTOPPEL CERTIFICATE
Tenant: PALM CANYON THEATRE, INC.
Landlord: CITY OF PALM SPRINGS, a municipal corporation
Date of Lease:
Premises: 538 North Palm Canyon Drive
To: Palm Canyon Theatre, Inc.
William J. Layne,
Palm Springs, CA 92263
The undersigned hereby certifies as follows:
1. The undersigned is the tenant ("Tenant") under the above-referenced lease ("Lease")
covering the above-referenced premises ("Premises").
2. The Lease constitutes the entire agreement between landlord and Tenant with respect to the
Premises and the Lease has not been modified, changed, altered or amended in any respect
except as set forth above.
3. The term of the Lease commenced on , 20 and, including any presently
exercised option or renewal term, will expire on 20 . Tenant has
accepted possession of the Premises and is the actual occupant in possession thereof and
has not sublet, assigned or hypothecated its leasehold interest.
4. As of this date, to the best of Tenant's knowledge, there exists no breach or default, nor
state of facts which, with notice, the passage of time, or both, would result in a breach or
default on the part of either Tenant or Landlord. To the best of Tenant's knowledge, no
claim, controversy, dispute, quarrel or disagreement exists between Tenant and Landlord.
5. Tenant is currently obligated to pay Rent in installments of$ per month and
such monthly installments have been paid not more than one month in advance. To the
best of Tenant's knowledge, no other rent has been paid in advance and Tenant has no
claim or defense against Landlord under the Lease and is asserting no offsets or credits
against either the rent or Landlord. Tenant has no claim against Landlord for any security
or other deposits except $2,500 which was paid pursuant to the Lease.
F-1
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
6. Tenant has no option or preferential right to lease or occupy additional space within the
Property of which the Premises are a part. Tenant has no option or preferential right to
purchase all of any part of the Premises nor any right or interest with respect to the
Premises other than as Tenant under the Lease. Tenant has no right to renew or extend the
term of the Lease except as set forth in the Lease.
7. Tenant has made no agreements with Landlord or its agent or employees concerning free
rent, partial rent, rebate of rental payments or any other type of rent or other concession
except as expressly set forth in the Lease.
8. There has not been filed by or. against Tenant a petition in bankruptcy, voluntary or
otherwise, any assignment for the benefit of creditors, or any petition seeking
reorganization or arrangement under the bankruptcy laws of the United States, or any state
thereof, or any other action brought under said bankruptcy laws with respect to Tenant.
9. All insurance which Tenant is required to maintain under the Lease has been obtained by
Tenant and is in full force and effect and all premiums with respect thereto have been paid.
Dated this day of 20_
By:
Its:
F-2
Palm Canyon Theatre Lease
538 North Palm Canyon Drive
PHILADELPHIA INDEMNITY INSURANCE COMPANY
1-877-438-7459
ONE BALA PLAZA, SUITE 100
BALA CYNWYD PA 19004
NOTICE OF CANCELLATION OF INSURANCE
Named Insured & Mailing Address:
PALM CANYON THEATER COMPANY
538 N PALM CANYON DR
PALM SPRINGS CA 92262-5526
Producer:0003334
HUB INTERNATIONAL INSURANCE SERVICES
4695 MACARTHUR CT STE 600
NEWPORT BEACH CA 92660-1861
Policy No.: PHPK2633431
Type of Policy: NP :NON PROFIT PACKAGE
Date of Cancellation: 05/17/2024; 12:01 A.M. Local Time at the mailing address of the Named Insured.
We are cancelling this policy. Your insurance will cease on the Date of Cancellation shown above.
The reason for cancellation is NONPAYMENT OF PREMIUM 1301.25.
This policy provides basic property insurance on your property. You should contact your agent concerning
coverage through another insurer, or your eligibility for coverage through the California Fair Plan, P.O. Box
76924, Los Angeles, CA 90076, Phone: (800) 339-4099 or www.cfpnet.com.
Your interest in this policy as an "insured" or other party of interest is being cancelled effective 05/17/2024;
12:01 A.M. Local Time at the mailing address of the named insured.
Other Party of Interest
CITY OF PALM SPRINGS
3200 E TAHQUITZ CANYON WAY
PO BOX 2743
PALM SPRINGS CA 92262
1RECmm
APR 2 9 2024
OFFICE OF THE CITY CLERK
Date Mailed:
26t y of Apri , 24
JOAN HILLMAN
CACC36NONPMNT
FORM# CC969701 CA1 02020 04252024MYNY
ODEN 3.0.24.02a Copy for Other Interests Page 1 of 1
0000014-0000028
PHILADELPHIA INDEMNITY INSURANCE COMPANY
1-877-438-7459
ONE BALA PLAZA, SUITE 100
BALA CYNWYD PA 19004
REINSTATEMENT NOTICE
Named Insured & Mailing Address: Producer: 0003334
PALM CANYON THEATER COMPANY HUB INTERNATIONAL INSURANCE SERVICES
538 N PALM CANYON DR 4695 MACARTHUR CT STE 600
PALM SPRINGS CA 92262-5526 NEWPORT BEACH CA 92660-1861
Policy No.: PHPK2633431
Type of Policy: NP :NON PROFIT PACKAGE
You recently received a notice advising this policy was being cancelled effective 05/17/2024 .
This notice is to advise that the policy is being reinstated without lapse in coverage.
Other Party of Interest
RECEIVED
MAY 0 6 2024
OFFICE OF THE CIT :f CLERK
CITY OF PALM SPRINGS
3200 E TAHQUITZ CANYON WAY
PO BOX 2743
PALM SPRINGS CA 92262
FORM# CT969897CA51995
ODEN 3.0.24.02a
0000832-0001664
Copy for Other Interests
Date Mailed:
1 st of May, 0 4
JOAN HILLMAN
CACT36
05012024SNNY
Page 1 of 1