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HomeMy WebLinkAbout03785 - PALM CANYON THEATRE LEASE 538 NPC MO 5927 SECOND AMENDED AND RESTATED LEASE By and Between THE CITY OF PALM SPRINGS and THE PALM CANYON THEATRE, INC. 538963.1 4 r; I RECITALS A. On July 9, 1997, City and Tenant entered into that certain Lease Agreement ("Lease") for a portion of real property described in Exhibit "A" attached and incorporated into the Lease ("Legal Description of the Premises") B. On October 1, 1997, City and Tenant entered into that certain First Amendment to Lease, increasing Tenant's exclusive use of floor area at the Premises, increasing the monthly rental and prepaid rent amount, and allowing certain Tenant electrical improvements and repairs on the Premises. C. On June 17, 1998, City and Tenant entered into that certain Second Amendment and Addendum to adjust the rent and reflect the cost of public improvements made by Tenant, to clarify the responsibility for certain public improvements, and to change the accounting requirements of the Lease. D. On June 5, 2002, City and Tenant entered into that certain Third Amendment to Lease extending the term of the Lease through April 30, 2007, adjusting the Monthly Rental, amending provisions relating to the use of the Premises and late payment. E. On February 16, 2007, City and Tenant entered into that certain Fourth Amendment to Lease for the purpose of incorporating and coordinating Tenant improvements with the Palm Springs International Film Festival, making a $200,000 Tenant improvement allowance to Tenant for the Premises. F. On May 1, 2007, City and Tenant entered into that certain Amended and Restated Lease extending the term of the Lease through April 30, 2012. G. On February 1, 2012, the City issued a Request for Proposals (RFP) for a Resident Performing Arts and/or Visual Arts Company for the Frances Stevens Park Cultural Arts Center in Palm Springs, and Tenant submitted a proposal to the City. H. The City and Tenant desire to extend the Lease term and modify certain other provisions of the Lease set forth below. NOW, THEREFORE, in consideration of the mutual covenants and obligations in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows! 1. Section 4.9 of the Lease is amended to clarify the Tenant's obligations when the Landlord leases the Premises outside the scope of the Lease. 2. Section 2.4 of the Lease is amended to provide for additional right of termination by Landlord after the first anniversary date of the Lease. . 3. The Rules and Regulations of the Lease has been amended to add a provision requiring the Tenant to provide professional janitorial service for the restrooms as needed. 4. The Lease is amended and restated to incorporate all previous Lease Amendments and current agreement, commencing on May 1 , 2012 and expiring on April 30, 2015. i SECOND AMENDED AND RESTATED LEASE 538963.1 SECOND AMENDED AND RESTATED LEASE By and Between THE CITY OF PALM SPRINGS and THE PALM CANYON THEATRE, INC. THIS LEASE ("Lease') is made and entered into this �� day of 2012, by and between the CITY OF PALM SPRINGS, a municipal corpor tion ("Landlord"), and THE PALM CANYON THEATRE, INC., a non profit corporation ("Tenant"). 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 County of Riverside, State of California, as more particularly described in 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. May 1, 2012. Term: 3 years. Lease Termination Date: April 30, 2015. (See Section 2.1) 1.4 Monthly Rental. $1,785.71 (See Section 3.1) 1.5 Security Deposit. $2,500.00. (See Section 3.9) 1.6 Prepaid Rent. $1,290.00. (Deposited with the Landlord previously with the execution of the First Amendment to the Lease dated October 1, 1997). 1.7 Use of Premises. Non-profit professional actors' equity and/or non- equity live indoor theatre; including an approximately 210-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. (See Section 4.1) 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". 2 SECOND AMENDED AND RESTATED LEASE 539963.1 The Tenant is entitled to recover its cost incurred when another user leases the facility, provided that such cost shall be recoverable, if at all, solely from the other user. 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 outside of scheduled dates of use by Tenant. 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 ("PSIFF"), 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 in addition, for film screenings ("Screenings") by the Palm Springs International Film Society, a California nonprofit corporation ("PSIFS") 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. Tenant shall coordinate a minimum of 30 days in advance with PSIFF 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 PSIFF and its patrons during such events. In addition, Tenant operates a summer Kid's Camp in the premises during June and July of each year. 1.8 Address for Notices. Tenant: The Palm Canyon Theatre 538 North Palm Canyon Drive Palm Springs, CA 92262 Attn: Dr. William J. Layne or Mr. J. W. Layne Landlord: City of Palm Springs 3200 East Tahquitz Canyon Way Palm Springs, CA 92262 Attn: City Manager 1 .9 Charitable Lease. If S cfon 4.8 of this Lease relating to charitable leases is applicable, please initial here If not initialed, the Rent shall be the fair market rental value, increased pursua t to Section 3.2. If Section 4.8 is applicable, the fair market rental value of the Premises is $9,000 per month. 3 SECOND AMENDED AND RESTATED LEASE 538963.1 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 the period specified therein unless earlier terminated as provided herein. 2.2 Time. Time is of the essence of this Lease. 2.3 Force Maieure. If either party hereto shall be delayed or prevented from the performance of any act required hereunder by reason of acts of God, strikes, lockouts, labor troubles, inability to procure materials, 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, 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. 2_4 Termination by Landlord. Landlord shall have the right to terminate this Lease at any time after the first anniversary of the Commencement Date, for its convenience and without cause, upon giving Tenant ninety (90) days written notice. In addition, the Tenant may terminate this Lease at any time, with or without cause, upon ninety (90) days written notice to the Landlord, and shall have no further obligation to the Landlord. Landlord shall also have the right to terminate this Lease with or without cause on the first anniversary of the Commencement Date by providing Tenant with at least thirty (30) days' advance written notice. If Landlord or Tenant terminates 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 and relocation benefits, inverse condemnation or the taking of property and Landlord shall have no obligation to pay Tenant therefor. This section 2.4 supersedes all agreements in the Lease and amendments concerning termination by landlord. 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. 2_5 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 at a monthly rental equal to one hundred and fifty percent (150%) of the monthly rental in effect at the expiration of the term and upon terms and conditions as existed during the last year of the term hereof. 4 SECOND AMENDED AND RESTATED LEASE 538963.1 3.0 RENTAL 3.1 Monthly Rental. 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 4.8 requires fair market value in which case the Tenant shall pay the sum specified in Section 1.9, 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 1.8 hereof. 3.2 Cost of Living Adiustment. Upon each annual anniversary date of the 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, 2012, 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, All Urban Consumers (All Items), for the Los Angeles-Anaheim- Riverside Metropolitan Area, published by the United States Department of Labor, Bureau of Labor Statistics (1982-84 = 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 Additional Rental. For the purposes of this Lease, all monetary obligations of Tenant under this Lease, including but not limited to, insurance premiums, property taxes, maintenance expenses, late charges and utility costs shall be deemed to be additional rental. 3.4 Real Property Taxes. In addition to all rentals herein reserved, Tenant shall pay, at the election of Landlord, either directly to the taxing authority or to Landlord, annual real estate taxes and assessments levied upon the Premises (including any possessory interest taxes), 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. Such amount shall be paid on the date that is twenty (20) days prior to the delinquent date or, if Landlord receives the tax bill, ten (10) days after receipt of a copy of the tax bill from Landlord, whichever is later. Even though the term of this Lease has expired and Tenant has vacated the Premises, when the final determination is made of 5 SECOND AMENDED AND RESTATED LEASE 538963.1 Tenant's share of such taxes and assessments, Tenant shall immediately pay to Landlord the amount of any additional sum owed. 3.5 Personal Property Taxes. During the term hereof Tenant shall pay prior to delinquency all taxes assessed against and levied upon fixtures, furnishings, equipment and all other personal property of Tenant contained in the Premises, and when possible Tenant shall cause said fixtures, furnishings, equipment and other personal property to be assessed and billed separately from the real property of Landlord. 3.6 Utilities. Tenant shall pay before delinquency all charges for water, gas, heat, electricity, sewer, telephone service, and all other services used in, upon, or about the Premises by Tenant or any of its subtenants, licensees, or concessionaires during the term of this Lease. 3.7 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 prior to the anniversary date or the City may exercise its right of termination under Section 2.4 and terminate the lease. 3.8 Interest. Any sum to be paid pursuant to the terms of this Lease not paid when due shall bear interest from and after the due date until paid at a rate equal to three percent (3%) over the reference rate being charged by Bank of America, N. A. from time to time during such period so long as the rate does not exceed the maximum non-usurious rate permitted by law in which case interest shall be at the maximum non-usurious rate allowed by law at the time the sum became due. 3.9 Security Deposit. Tenant has previously with the execution of the original Lease dated July 9, 1997, deposited with the Landlord the sum specified in Section 1.5 hereof, receipt of which is hereby acknowledged by Landlord, said deposit being given to secure the faithful performance by the Tenant of all terms, covenants, and conditions of this Lease by the Tenant to be kept and performed during the term hereof. Tenant agrees that if the Tenant shall fail to pay the rent herein reserved or any other sum required hereby promptly when due, said deposit may, at the option of the Landlord (but Landlord shall not be required to) be applied to any rent or other sum due and unpaid, and if the Tenant violates any of the other terms, covenants, and conditions of this Lease, said deposit may, at Landlord's option, be applied to any damages suffered by Landlord as a result of Tenant's default to the extent of the amount of the damages suffered. 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 6 SECOND AMENDED AND RESTATED LEASE 538963.1 law or in equity. Should the entire security deposit, or any portion thereof, be appropriated and applied by Landlord for the payment of overdue rent or other sums due and payable to Landlord by Tenant hereunder, then Tenant shall, on the written demand of Landlord, forthwith remit to Landlord a sufficient amount in cash to restore said security deposit to its original amount, and Tenant's failure to do so within five (5) days after receipt of such demand shall constitute a breach of this Lease. Should Tenant comply with all of the terms, covenants, and conditions of this Lease and promptly pay all of the rental herein provided for as it falls due, and all other sums payable by Tenant to Landlord hereunder, said security deposit shall be returned in full to Tenant at the end of the term of this Lease; or upon the earlier termination of this Lease as specified herein except in the event the Premises are sold as a result of the exercise of any power of sale under any mortgage or deed of trust, in which event this Lease shall be automatically amended to delete any reference to this Section and Tenant shall be entitled to immediate reimbursement of its security deposit from the party then holding said deposit. 4.0 USE OF THE PREMISES 4.1 Permitted Use. The Landlord hereby leases to Tenant and Tenant hires from Landlord the Premises with appurtenances as defined herein, for the purpose of conducting thereon only the use specified in Section 1.7 of this Lease and for no other use. Tenant may sell refreshments, beer, and other concessions during performances as long as Tenant obtains all necessary licenses. 4.2 Prohibited Uses. Tenant shall not sell or permit to be kept, used, displayed or sold in or about the 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, or (b) any article which may be prohibited by standard forms of fire insurance policies. Tenant shall not use, or permit to be used the Premises or any part thereof for the installation or on-premises use of any vending machine, gaming machine or video or arcade game unless expressly permitted by this Lease. 4.3 Compliance with Laws. Tenant shall, at his own cost and expense, comply with all of the requirements of all municipal, state and federal authorities now in force or which may hereafter be in force pertaining to the use of the Premises, and shall faithfully observe in said use all municipal ordinances, including, but not limited to, the General Plan and zoning ordinances, state and federal statutes, or other governmental use regulations now in force or which shall hereinafter be in force. Tenant's violation of law shall constitute an incurable default under this Lease. The judgment of any court of competent jurisdiction, or the admission of Tenant in any action or proceeding against Tenant, whether Landlord is a party thereto or not, that Tenant has violated any such order or statute in said use, shall be conclusive of that fact as between the Landlord and Tenant. Tenant shall not engage in any activity on or about the Premises that violates any Environmental Law, and shall promptly, at Tenants sole cost and expense, SECOND AMENDED AND RESTATED LEASE 5389631 take all investigatory and/or remedial action required or ordered by any governmental agency or Environmental Law for clean-up and removal of any contamination involving any Hazardous Material created or caused directly or indirectly by Tenant. The term "Environmental Law" shall mean any federal, state or local law, statute, ordinance or regulation pertaining to health, industrial hygiene or the environmental conditions on, under or about the Demised Premises, including, without limitation, (i) the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), 42 U.S.C. Sections 9601 et seq.; (ii) the Resource Conservation and Recovery Act of 1976 ("RCRA"), 42 U.S.C. Sections 6901 et seq.; (iii) California Health and Safety Code Sections 25100 et seq.; (iv) the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249.5 et seq.; (v) California Health and Safety Code Section 25359.7; (vi) California Health and Safety Code Section 25915; (vii) the Federal Water Pollution Control Act, 33 U.S.C. Sections 1317 et seq.; (viii) California Water Code Section 1300 et seq.; and (ix) California Civil Code Section 3479 et seq., as such laws are amended and the regulations and administrative codes applicable thereto. The term "Hazardous Material' includes, without limitation, any material or substance which is (i) defined or listed as a "hazardous waste", "extremely hazardous waste", "restrictive hazardous waste" or "hazardous substance" or considered a waste, condition of pollution or nuisance under the Environmental Laws; (ii) petroleum or a petroleum product or fraction thereof; (iii) asbestos; and/or (iv) substances known by the State of California to cause cancer and/or reproductive toxicity. It is the intent of the parties hereto to construe the terms "Hazardous Materials" and "Environmental Laws" in their broadest sense. Tenant shall provide all notices required pursuant to the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249.5 et seq. Tenant shall provide prompt written notice to Landlord of the existence of Hazardous Substances on the premises and all notices of violation of the Environmental Laws received by Tenant. 4.4 Signs. 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 Tenants 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 nonexclusive 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. 8 SECOND AMENDED AND RESTATED LEASE 5389611 4.6 Maintenance of Common Arens. During the entire term hereof, Landlord shall keep or cause to be kept the parking and common areas as same are established and completed by Landlord in a good, neat, clean and orderly condition, properly lighted and landscaped, and shall repair any damage to the facilities thereof as well as the exterior walls and roof of the Premises as provided in Article 11. 4.7 Hours of Business. Subject to the provisions of Section 8.0 hereof, Tenant shall continuously during the entire term hereof conduct and carry on Tenant's business in the Premises and shall keep the Premises open for business and cause Tenant's business to be conducted therein during the usual business hours of each and every business day as is customary for theaters of like character to be open for business in Riverside County. This provision shall not apply if the Premises should be dosed and the business of Tenant temporarily discontinued therein on acoount of strikes, lockouts,or similar causes beyond the reasonable control of Tenant. It is the intention of Landlord that the Premises are open during evening hours to promote business in the City of Palm Springs and, therefore, Tenant shall participate in any program established by Landlord to provide evening shopping and entertainment, which program may be administered by such entity that may be designated by the Landlord. 4.8 Charitable Leases. The provisions of this Section are required by Resolution No. 14527 of the City Council and shall only apply as indicated in Section 1.10. Tenant hereby represents and warrants to Landlord that Tenant is exempt from federal income taxation pursuant to Internal Revenue Code Sections 501(c)(1)and/or 501(c)(3)and that Tenant's use of the Premises as specified in Section 1.7 is a tax exempt function. Tenant hereby acknowledges that the Monthly Rent is below fair market rental rates and that the fair market rental value of the property is as specified in Section 1.9. Prior to the execution of this Lease, Tenant has provided Landlord with a proposed program for which the Tenant intends to use the Premises ("Program"). On each anniversary of the Commencement Date,Tenant shall submit to Landlord a report, in a form and content satisfactory to Landlord,setting forth Tenants progress in meeting the provisions of the program during that year. If Landlord is not satisfied with the Tenant's performance, Landlord may terminate this Lease upon thirty(30)days'advance written notice to Tenant or increase the Monthly Rent to the fair market rental for the Premises as specified in Section 1.9 (increased pursuant to Section 3.2, if applicable). 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. 4.9 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 9 SECOND AMENDED AND RESTATED LEASE 538963.1 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 AND REPAIRS. 5.1 Alterations and Fixtures. Tenant shalt not make, or suffer to be made, any alterations to the Premises, or any part thereof, without the prior written consent of Landlord, and any alterations to the Premises, except movable furniture and trade fixtures, shall become at once a part of the really and shall at the expiration or earlier termination of this Lease belong to Landlord.Tenant shall not in any event make any changes to the exterior of the Premises.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. Tenant may leave all equipment and fixtures relating to the operation of the theatre on the Premises with the exception of fighting instruments and control boards, sound boards, microphones, recording and playback equipment.Any removal of alterations or furniture and trade fixtures shall be at Tenant's expense and accomplished in a good 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, dean and sanitary condition as required by Section 5.2 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 and Repair. Tenant shall, subject to Landlord's obligations hereinafter provided, at all times during the term hereof, and at Tenant's sole cost and expense, keep, maintain and repair the Premises, and other improvements within the Premises in good and sanitary order, condition, and repair (except as hereinafter provided), including, without limitation, the maintenance and repair of any doors, window casements, walls, glazing, heating and air conditioning system, plumbing, pipes, electical wiring and conduits. Tenant shall also at its sole cost and expense be responsible for any alterations or improvements to the Premises necessitated as a result of the requirement of any municipal, state or federal authority. Tenant hereby waives all right 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 good and sanitary 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 good, clean and sanitary condition, reasonable use and wear thereof and damage by fire, ad of God or by the elements excepted. Tenant shall periodically sweep and dean the sidewalks adjacent to the Premises, as needed. Upon Tenant's possession of the Premises,Tenant shall be deemed to have accepted the Premises as being in good condition and repair. Tenant agrees that it will not, nor will it authorize any person to,go onto the roof ofthe building of which the Premises are a part without the prior written consent of Landlord. Said is SECOND AMENDED AND RESTATED LEASE 538963.1 consent will be given only upon Landlord's satisfaction that any repairs necessitated as a result of Tenants action will be made by Tenant at Tenant's expense and will be made in such a manner so as not to invalidate any guarantee relating to said roof. 5.3 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. 5.4 Additional Consideration for Lease. As additional oonsideration 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 (90%) of the replacement value of the building containing 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 forwhich 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 and shall provide plate glass coverage. (b) Tenant to Provide Liability Insurance. During the entire term of this Lease, the Tenant shall, at the Tenant's 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 or provided, 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 Workers' Compensation Insurance. Tenant shall, at the Tenant's sole cost and expense, maintain a policy of workers' 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 11 SECOND AMENDED AND RESTATED LEASE 538963.1 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 subrogation and 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 thirty (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 thirty(30)days prior to the expiration of any insurance policy, Tenant shall provide Landlord with endorsements 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 Best's Insurance Guide. In the event the Risk Manager of Landlord ("Risk Manager") determines that (i) the Tenants 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 Tenant's 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 or leakage, and earthquake. 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 lawful in Caltfomia 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 underthis Lease,herebywaives 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 officers, agents 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 negligent 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 parking 12 SECOND AMENDED AND RESTATED LEASE 5389631 and common areas by Tenant or its employees and customers, or arising from the failure of Tenant to keep the Premises in good condition and repair, as herein provided, or arising from the negligent acts or omissions of Tenant hereunder, or arising from Tenants negligent perfonnance 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 or employees but excluding such claims or liabilities arising from the sole negligence or willful misconduct of the Landlord, its officers, agents 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 attomeys'fees incurred in connection therewith; (b) Tenant will promptly pay anyjudgment rendered against the Landlord, its officers, agents 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, and employees harmless therefrom; (c) In the event the Landlord, its officers, agents 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 or employees, any and all costs and expenses incurred by the Landlord, its officers, agents 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; and if Tenant shall abandon,vacate orsurrenderthe Premises 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 ti 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 Tenants act, use or occupation, which declaration requires repairs to the Premises, Landlord shall forthwith make said repairs provided Tenant gives to Landlord thirty (30) days' written notice of the necessity therefor. No such partial destruction (including any destruction necessary in order to make repairs required by any declaration 13 SECOND AMENDED AND RESTATED LEASE 538963.1 made by any public authority)shall in any way annul or void this Lease except that Tenant shall be entitled to a proportionate reduction of Monthly Rental while such repairs are being made, such proportionate reduction to be based upon the extent to which the making of such repairs shall interfere with the business carded on by Tenant in the Premises. However, if during the last two(2) years of the term of this Lease the Premises are damaged as a result of fire or any other insured casualty to an extent in excess of twenty-five percent (25%) of the then replacement cost (excluding foundations), Landlord may within thirty (30) days following the date such damage occurs terminate this Lease by written notice to Tenant. If Landlord, however, elects to make said repairs, and provided Landlord uses due diligence in making said repairs, this Lease shall continue in full force and effect, and the Monthly Rental shall be proportionately reduced while such repairs are being made as hereinabove provided. Nothing in the foregoing to the contrary withstanding, if the Premises or said building is damaged or destroyed at any time during the term hereof to an extent of more than twenty-five percent (25%) of the then replacement cost (excluding foundations)as a result of a casualty not insured against, Landlord may within thirty (30) days following the date of such destruction terminate this Lease upon written notice to Tenant. If Landlord does not elect to terminate because of said uninsured casualty, Landlord shall promptly rebuild and repair the Premises and/or the building and the Monthly Rental shall be proportionately reduced while such repairs are being made as hereinabove provided. If Landlord elects to terminate this Lease, all rentals shall be prorated between Landlord and Tenant as of the date of such destruction. In respect to any partial or total destruction (including any destruction necessary in order to make repairs required by any such declaration of any authorized public authority) which Landlord is obligated to repair or may elect to repair under the terms of this Section, Tenant waives any statutory right it may have to cancel this Lease as a result of such destruction. 9.0 ASSIGNMENT AND SUBLETTING.Tenant shall not assign this Lease or sublet all or a portion of the Premises 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 twenty five percent(25%) of the present ownership and/or control of Tenant, taking all transfers into a000unt 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; and (d)the failure of tenants 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)br 501(c)(3)and the proposed assignee's or subtenants proposed use of the Premises is a tax exempt furxction. Any such assignment shall be subject to all of the terms and condtions of this Lease and the proposed assignee shall assume the obligations of Tenant underthis Lease in writing in form satisfactory to Landlord. The proposed assignee shall simultaneously provide to Landlord an estoppel certificate in the form described in Section 12.3 hereafter. Consent by Landlord to one assignment, subletting, occupation or use by another person shall not be deemed to be consent to 14 SECOND AMENDED AND RESTATED LEASE 539963.1 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 DEFAULT 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 rental 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 failure to perform any of Tenant's agreements or obligations hereunder (exclusive of a default in the payment of money) where such default shall continue for a period of thirty(30)days after written notice thereof from Landlord to Tenant which notice shall be deemed to be the statutory notice so long as such notice complies with statutory requirements; (c)the vacation or abandonment of the Premises by Tenant;(d)the making by Tenant of a general assignment for the benefit of creditors; (e) the filing by Tenant of a voluntary petition in bankruptcy or the adjudication of Tenant as a bankrupt; (f)the appointment of a receiver to take possession of all or substantially all the assets of Tenant located at the Premises or of Tenant's leasehold interest in the Premises; (g)the filing by any creditor of Tenant of an involuntary petition in bankruptcy which is not dismissed within sixty(60)days after filing; or(h)the attachment, execution or otherjudicial seizure of all or substantially all of the assets of Tenant or Tenant's leasehold%here such an attachment, execution or seizure is not discharged within sixty(60)days. Any repetitive failure by Tenant to perform its agreements and obligations hereunder, though intermittently cured, shall be deemed an incurable default. Two (2) breaches of the same covenant within a sixty (60) day period, a notice having been given pursuant to (a)or(b)above for the first breach, or three (3) of the same or different breaches at any time during the terra of this Lease for which notices pursuant to (a) or (b) above were given for the first two (2) breaches shall conclusively be deemed to be an incurable repetitive failure by Tenant to perform its obligations hereunder. In the event of any such default or breach by Tenant, Landlord may at any time thereafter, without further notice or demand, rectify or cure such default, and any sums expended by Landlord for such purposes shall be paid by Tenant to Landlord upon demand and as additional rental hereunder. In the event of any such default or breach by Tenant, Landlord shall have the right(i)to continue the lease in full force and effect and enforce all of its rights and remedies under 15 SECOND AMENDED AND RESTATED LEASE 538963.1 this Lease, including the right to recover the rental as it becomes due under this Lease, or(ii) Landlord shall have the right at any time thereafter to elect to terminate the Lease and Tenant's right to possession thereunder. Upon such termination, Landlord shall have the right to recover from Tenant: (i) The worth at the time of award of the unpaid rental which had been earned at the time of termination; (ii) The worth at the time of award of the amount by which the unpaid rental which would have been earned after termination until the time of award exceeds the amount of such rental loss that the Tenant proves could have been reasonably avoided; (iii) The worth at the time of award of the amount by which the unpaid rental for the balance of the term after the time of award exceeds the amount of such rental loss that the Tenant provescouki be reasonably avoided; and (iv) Any other amount necessary to compensate the Landlord for all the detriment proximately caused by Tenant's failure to perform its obligations under the lease or which in the ordinary course ofthings would be likely to result therefrom. The "worth at the time of award" of the amounts referred to in subparagraphs(i) and (ii) above shall be computed by allowing interest at three percent(3%) over the prime rate then being charged by Bank of America, NA but in no event greater than the maximum rate permitted by law. The worth at the time of award of the amount referred to in subparagraph(iii)above shall be 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%), but in no event greater than ten percent (10%). As used herein "rental" shall include the Monthly Rental, other sums payable hereunder which are designated "rental" or "additional rental" and any other sums payable hereunder on a regular basis such as reimbursement for real estate taxes. Such efforts as Landlord may make to mitigate the damages caused by Tenants breach of this Lease shall not constitute a waiver of Landlord's right to recover damages against Tenant hereunder, nor shall anything herein contained affect Landlord's right to indemnification against Tenant for any liability arising prior to the termination of this Lease for personal injuries or property damage, and Tenant hereby agrees to indemnify and hold Landlord harmless from any such injuries and damages, including all attorneys' fees and costs incurred by Landlord in defending any action brought against Landlord for any recovery thereof, and in enforcing the terms and provisions of this indemnification against Tenant. 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 16 SECOND AMENDED AND RESTATED LEASE 538963.1 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 Default. Landlord shall not be in default unless Landlord fails to perform obligations required of Landlord within a reasonable time, but in no event later than thirty (30) days after written notice by Tenant to Landlord and to the holder of any first mortgage or deed of trust covering the Premises whose name and address shall have theretofore been furnished to Tenant in writing, specifying wherein Landlord has failed to perform such obligation; provided, however, that if the nature of Landlord's obligation is such that more than thirty (30) days are required for performance then Landlord shall not be deemed in default if Landlord commences performance within a (30) day period and thereafter diligently prosecutes the same to completion. In no event shall Tenant have the right to terminate this Lease as a result of Landlord's default and Tenant's remedies shall be limited to damages and/or an injunction. 11.0 CONDEMNATION. In the event a condemnation or a transfer in lieu thereof results in a taking of any portion of the Premises, Landlord may, or in the event a condemnation or a transfer in lieu thereof results in a taking of twenty-five percent (25W) or more of the Premises, Tenant may, upon written notice given within thirty (30) days after such taking or transfer in lieu thereof, terminate this Lease. Tenant shall not be entitled to share in any portion of the award and Tenant hereby expressly waives any right or claim to any part thereof. Tenant shall, however, have the right to claim and recover, only from the condemning authority (but not from Landlord), any amounts necessary to reimburse Tenant for the cost of removing stock and fixtures. If this Lease is not terminated as above provided, Landlord shall use a portion of the condemnation award to restore the Premises. 12.0 MISCELLANEOUS. 12.1 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. Such Modifications may include, without limitation, the right to construct new buildings on the Property for additional uses, to remove, renovate, repair, add to, modernize or otherwise alter the building in which the Premises are situated as well as other buildings, facilities, structures, malls, walkways, landscaping, parking and common areas or other areas within 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. 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, 17 SECOND AMENDED AND RESTATED LEASE 538963.1 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, nor entitle Tenant to damages, injunctive relief or other equitable relief, nor entitle Tenant to any abatement or reduction in the Monthly Rental, additional rental or other charges or sums due under this Lease; provided Landlord uses reasonable efforts to mitigate any adverse effects on Tenant caused by the Modifications. 12.2 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 or for the purpose of maintaining 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 and without any liability to Tenant for any loss of occupation or quiet enjoyment of the Premises thereby occasioned. Tenant shall permit Landlord, at any time within six (6) months prior to the expiration of this Lease, to place upon the Premises any usual or ordinary "For Lease" signs, and during such (6) month period Landlord or his agents may, during normal business hours, enter upon said Premises and exhibit same to prospective tenants. 12.3 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 "C" addressed to any existing or proposed mortgagee or proposed purchaser, and to the Landlord. Tenant shall be liable for any loss 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. 12.4 Jurisdiction and Venue. 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. 12.5 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. 12.6 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. is SECOND AMENDED AND RESTATED LEASE 538963.1 12.7 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. 12.8 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. 12.9 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, and that the provisions of this Lease and the agreements relating to rent payable hereunder are included solely for the purpose of providing a method whereby rental payments are to be measured and ascertained. 12.10 Nondiscrimination. Tenant herein covenants by and for itself, its heirs, executors, administrators and assigns and all persons claiming under or through it, and this Lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any person or group of persons on account of race, sex, marital status, color, creed, national origin or ancestry, in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the Premises herein leased, nor shall the Tenant itself, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sub-lessees, subtenants or vendees in the Premises. 12.11 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 1.8. 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. 12.12 Waiver. No delay or omission in the exercise of any right or 19 SECOND AMENDED AND RESTATED LEASE 538963.1 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 parry'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. 12.13 Exhibits and Addenda.The Exhibits and Addenda attached to this Lease are made a part hereof as if fully set forth herein. In the event of a conflict between the terms and provisions of Addenda and the terms and provisions of this Lease,the terms and provisions of the Addenda shall prevail. zo SECOND AMENDED AND RESTATED LEASE 5389631 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 Corporation By: By'_ � mes Thompson, City Clerk Its: APPROVED BY CITY COUNCIL APPROVED AS TO FORM: 11 1a A� J,,�_ Dou las Holland, City Attorney "Tenant" PALM CANYON THEATRE, INC., a non- profit corporation By: Zi / e Its: By: W 21 SECOND AMENDED AND RESTATED LEASE 538963.1 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 southern most half of 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 comerthereof;thence South 890 42'West on said South line, 297.40 feet; thence North on the East line of a public highway 550.4 feet; thence North 890 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 00 2' 30" East and parallel with said East line, 550.4 feet to the point of beginning. EXHIBIT"A" SECOND AMENDED AND RESTATED LEASE 538963.1 EXHIBIT "B" PLOT PLAN OF DEMISED PREMISES u A ;cAa! > a a Y tilYLiF Li1f' O (1 1 I A n eoYs' y ru�cr YCQ MFa� A;CA OL S F y 4 M u 1 61 i 7010EF ----- n a Y � O tl P n ^ IA p n a . o a a i EXHIBIT`B" SECOND AMENDED AND RESTATED LEASE 538963.1 EXHIBIT "C" ESTOPPEL CERTIFICATE Tenant: PALM CANYON THEATRE Landlord: CITY OF PALM SPRINGS, a municipal corporation Date of Lease: Premises: To: 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 riot sublet, assigned or hypothecated its leasehold interest.All improvements to be constructed on the Premises by Landlord have been completed and accepted by Tenant and any tenant construction allowances have been paid in full. 4. As of this date, to the best of Tenants 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 Annual Rent in installments of $1,669.36 per month, and such monthly installments have been paid not more than one month in advance. To the best of Tenants 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$2,500.00 which was paid pursuant to the Lease. 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 EXHIBIT"C" SECOND AMENDED AND RESTATED LEASE 535212.1 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 auditors, 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: EXHIBIT"C SECOND AMENDED AND RESTATED LEASE 535212.1 EXHIBIT "D" RULES AND REGULATIONS 1. All loading and unloading of goods shall be done only at the times, in the areas and through the entrances reasonably designated for such purposes by Landlord. 2. The delivery or shipping of merchandise, supplies and fixtures to and from the Premises shall be subject to such rules and regulations as in the reasonable judgment of Landlord are necessary for the proper operation of the Premises or of the Property generally. 3. All of Tenant's refuse and rubbish shall be removed to central trash bins located in the Property, at Tenant's sole cost and expense. 4. 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. 5. 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. 6. 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 due to storage of stage sets or construction material in such areas, except to the extent specifically permitted by the provisions of Tenant's Lease. 7. Tenant shall not burn any trash or garbage of any kind in or about the Premises or the Property generally. 8. Tenant will not allow animals, except seeing-eye dogs and/or those animals used in theatre productions, in, about or upon the Premises. 9. 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 showers and cots provided in the Actors Equity dressing rooms solely for use by performers and required under the Equity contract. EXHIBIT"D" SECOND AMENDED AND RESTATED LEASE 538963.1 10. 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. 11. 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. EXHIBIT"D" SECOND AMENDED AND RESTATED LEASE 5389631 EXHIBIT "E" TENANT'S PROPERTY MANAGEMENT OBLIGATIONS As additional consideration for this Lease, Tenant agrees to provide a "non-profit professional equity and/or non-equity theatre" operation each year during the Lease term consisting of a minimum of six (6) professional quality indoor theatre productions on the Premises per season during the months of October through May, 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 in addition, for film screenings ("Screenings") by the Palm Springs International Film Society, a California nonprofit corporation ("PSIFS") 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 PSIFF regarding scheduling of 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 PSIFF and its patrons during such events. Tenant shall provide the theatre to the PSIFF/PSIFS clean and free of debris (inside lobby, projection booth, stage, bathrooms, auditorium and outside walkways), and ready for use for festivals and screenings. Tenant shall allow PSIFF/PSIFS use of the marquee(s) during Film Festivals and monthly film screenings. In consideration of the substantial contributions and improvements to the Theatre previously made by the PSIFF and hereby acknowledged by the City, no rental fee is to be charged by the Tenant to the PSIFF or PSIFS for use of the Premises except for the reimbursement of the pro rata share of the Tenant's utility and building maintenance direct costs actually incurred during the Film Festival time frame. 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, 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 and continue to operate several theatre-related educational outreach EXHIBIT"E" SECOND AMENDED AND RESTATED LEASE 538963.1 programs during the Lease term including, but not limited to, an Equity intern program; Kid's Camp, 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. EXHIBIT`E" SECOND AMENDED AND RESTATED LEASE 538963.1 AMENDED AND RESTATED LEASE By and Between THE CITY OF PALM SPRINGS and THE PALM CANYON THEATRE, INC. CMEE fG9 '� 4 538963.1 RECITALS A. On July 9, 1997, City and Tenant entered into that certain Lease Agreement ("Lease") for a portion of real property described in Exhibit "A" attached and incorporated into the Lease ("Legal Description of the Premises") B. On October 1, 1997, City and Tenant entered into that certain First Amendment to Lease, increasing Tenant's exclusive use of floor area at the Premises, increasing the monthly rental and prepaid rent amount, and allowing certain Tenant electrical improvements and repairs on the Premises- C. On June 17, 1998, City and Tenant entered into that certain Second Amendment and Addendum to adjust the rent and reflect the cost of public improvements made by Tenant, to clarify the responsibility for certain public improvements, and to change the accounting requirements of the Lease. D. On June 5, 2002, City and Tenant entered into that certain Third Amendment to Lease extending the term of the Lease through April 30, 2007, adjusting the Monthly Rental, amending provisions relating to the use of the Premises and late payment. E. On February 16, 2007, City and Tenant entered into that certain Fourth Amendment to Lease for the purpose of incorporating and coordinating Tenant improvements with the Palm Springs International Film Festival, making a $200,000 Tenant improvement allowance to Tenant for the Premises. F. The City and Tenant desire to extend the Lease term and modify certain other provisions of the Lease set forth below. NOW, THEREFORE, in consideration of the mutual covenants and obligations in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows: 1. Section 1.5 of the Lease is amended to provide that the Monthly Rental shall be $1,669.36. 2. Section 1.8 of the Lease is amended to provide that 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. 3. The Lease has been amended and restated to incorporate all previous Lease Amendments and current agreement, commencing on May 1, 2007 and expiring on April 30, 2012. 539963.1 TABLE OF CONTENTS Pape 1.0 LEASE SUMMARY 1 1.1 Premises 1 1.2 Approximate Floor Area of Premises 1 1.3 Lease Commencement Date 1 1.4 Monthly Rental 1 1.5 Security Deposit 1 1.6 Prepaid Rent 1 1.7 Use of Premises 1 1.8 Address for Notices 2 1.9 Charitable Lease 2 2.0 TERM 2 2.1 Initial Term 2 2.2 Time 2 2.3 Force Majeure 2 2.4 Termination by Landlord 3 2.5 Holding Over 3 3.0 RENTAL 3 3.1 Monthly Rental 3 32 Cost of Living Adjustment 3 3.3 Additional Rental 4 3.4 Real Property Taxes 4 3.5 Personal Property Taxes 4 3.6 Utilities 4 3.7 Late Payment 4 3.8 Interest 5 3.9 Security Deposit 5 4.0 USE OF THE PREMISES 5 4A Permitted Use 5 4.2 Prohibited Uses 6 4.3 Compliance with Laws 6 4.4 Signs 7 4.5 Parking and Common Areas 7 4.6 Maintenance of Common Areas 7 4.7 Hours of Business 7 4.8 Charitable Leases 7 4.9 Rules and Regulations 8 5.0 ALTERATIONS AND REPAIRS 8 5.1 Alterations and Fixtures 8 5.2 Maintenance and Repair 9 AMENDED AND RESYAILD LEASE TABLE OF CONTENTS Page 5.3 Free from Liens 9 5.4 Additional Consideration for Lease 9 6.0 INSURANCE AND INDEMNIFICATION 9 6.1 Insurance Provided by Landlord 9 62 Insurance Provided by Tenant 10 6.3 Indemnification of Landlord 11 7.0 ABANDONMENT AND SURRENDER 12 7.1 Abandonment 12 7.2 Surrender of Lease 12 8.0 DAMAGE AND DESTRUCTION OF PREMISES 12 9.0 ASSIGNMENT AND SUBLETTING 13 10.0 DEFAULT AND REMEDIES 13 10.1 Default by Tenant 13 102 No Waiver 15 10.3 Landlord's Default 15 11.0 CONDEMNATION 15 12.0 MISCELLANEOUS 16 12.1 Reservation of Right to Modify Property 16 12.2 Entry and Inspection 16 12.3 Estoppel Certificate 17 12.4 Jurisdiction and Venue 17 12.5 Partial Invalidity 17 12.6 Successors in Interest 17 12.7 No Oral Agreements 17 12.8 Authority 17 12.9 Relationship of Parties 17 12.10 Nondiscrimination 18 12.11 Notices 18 12.12 Waiver 18 12.13 Exhibits and Addenda 18 AMENDED AND RESTATED LEASE AMENDED AND RESTATED LEASE By and Between THE CITY OF PALM SPRINGS and THE PALM CANYON THEATRE, INC. THIS LEASE ("Lease") is made and entered into this day of , 2007, by and between the CITY OF PALM SPRINGS, a municipal corporation ("Landlord"), and THE PALM CANYON THEATRE, INC_, a non profit corporation ("Tenant"). 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 County of Riverside, State of California, as more particularly described in 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. May 1, 2007. Term: 5 years. Lease Termination Date: April 30, 2012. (See Section 2.1) 1.4 Monthly Rental. $1,669.36 (See Section 3.1) 1.5 Security Deposit. $2,500.00. (See Section 3.9) 1.6 Prepaid Rent. $1,290.00. (Deposited with the Landlord previously with the execution of the First Amendment to the Lease dated October 1, 1997). 1.7 Use of Premises. Non-profit professional actors' equity/non-equity live indoor theatre; including an approximately 230-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. (See Section 4A) 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, provided that such cost shall be recoverable, if at all, solely from the other user. The 1 AMENDED AND RESTATED LEASE 539963.1 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 ("PSIFF"), 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 late August/early September each year, and in addition, for film screenings ("Screenings") by the Palm Springs International Film Society, a California nonprofit corporation ("PSIFS") 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. Tenant shall coordinate a minimum of 30 days in advance with PSIFF 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 PSIFF and its patrons during such events. 1.8 Address for Notices. Tenant: The Palm Canyon Theatre 538 North Palm Canyon Drive Palm Springs, CA 92262 Attn: Dr, William J_ Layne or Mr. J. W. Layne Landlord: City of Palm Springs 3200 East Tahquitz Canyon Way Palm Springs, CA 92262 Attn: City Manager 1.9 Charitable Lease. 1#_S�eetien 4.8 of this Lease relating to charitable leases is applicable, please initial here' If not initialed, the Rent shall be the fair market rental value, increased pursuant to Section 3.2. If Section 4.8 is applicable, the fair market rental value of the Premises is $ per month_ 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 the period specified therein unless earlier terminated as provided herein. 2.2 Time. Time is of the essence of this Lease. 2 AMENDED AND RESTATED LEASE 538963 1 2.3 Force Majeure. If either party hereto shall be delayed or prevented from the performance of any act required hereunder by reason of acts of God, strikes, lockouts, labor troubles, inability to procure materials, 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, 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. 2.4 Termination by Landlord. Landlord shall have the right to terminate this Lease effective on any anniversary of the Commencement Date, with or without cause, by providing Tenant with at least thirty (30) days' advance written notice. If Landlord terminates 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 and relocation benefits, inverse condemnation or the taking of property and Landlord shall have no obligation to pay Tenant therefor. This section 2.4 supercedes all agreements in the Lease and amendments concerning termination by landlord. 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. 2.5 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 at a monthly rental equal to one hundred and fifty percent (150%) of the monthly rental 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 RENTAL 3.1 Monthly Rental. 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 4.8 requires fair market value in which case the Tenant shall pay the sum specified in Section 1.9, 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 1.8 hereof. 3.2 Cost of Living A6ustment. Upon each annual anniversary date of the Commencement Date or if the Commencement Date is not on the first day of a 3 AMENDED AND RESTATED LEASE 53ft963� 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, 2007, 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, All Urban Consumers (All Items), for the Los Angeles-Anaheim- Riverside Metropolitan Area, published by the United States Department of Labor, Bureau of Labor Statistics (1982-84 = 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 Additional Rental. For the purposes of this Lease, all monetary obligations of Tenant under this Lease, including but not limited to, insurance premiums, property taxes, maintenance expenses, late charges and utility costs shall be deemed to be additional rental. 3.4 Real Property Taxes. In addition to all rentals herein reserved, Tenant shall pay, at the election of Landlord, either directly to the taxing authority or to Landlord, annual real estate taxes and assessments levied upon the Premises (including any possessory interest taxes), 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. Such amount shall be paid on the date that is twenty (20) days prior to the delinquent date or, if Landlord receives the tax bill, ten (10) days after receipt of a copy of the tax bill from Landlord, whichever is later. Even though the term of this Lease has expired and Tenant has vacated the Premises, when the final determination is made of Tenant's share of such taxes and assessments, Tenant shall immediately pay to Landlord the amount of any additional sum owed. 3.5 Personal Property Taxes, During the term hereof Tenant shall pay prior to delinquency all taxes assessed against and levied upon fixtures, furnishings, equipment and all other personal property of Tenant contained in the Premises, and when possible Tenant shall cause said fixtures, furnishings, equipment and other personal property to be assessed and billed separately from the real property of Landlord. 3.6 Utilities. Tenant shall pay before delinquency all charges for water, gas, heat, electricity, power, sewer, telephone service, trash removal and all other services used in, upon, or about the Premises by Tenant or any of its subtenants, licensees, or concessionaires during the term of this Lease. 3.7 Late Payment. Tenant hereby acknowledges that late payment by Tenant to Landlord of rental or other sums due hereunder will cause Landlord to incur 4 AMENDED AND RESTATED LEASE 5389631 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 prior to the anniversary date or the City may exercise its right of termination under Section 2.4 and terminate the lease. 3.8 Interest_ Any sum to be paid pursuant to the terms of this Lease not paid when due shall bear interest from and after the due date until paid at a rate equal to three percent (3%) over the reference rate being charged by Bank of America, N. A. from time to time during such period so long as the rate does not exceed the maximum non-usurious rate permitted by law in which case interest shall be at the maximum non-usurious rate allowed by law at the time the sum became due. 3.9 Security Deposit. Tenant has previously with the execution of the original Lease dated July 9, 1997, deposited with the Landlord the sum specified in Section 1.5 hereof, receipt of which is hereby acknowledged by Landlord, said deposit being given to secure the faithful performance by the Tenant of all terms, covenants, and conditions of this Lease by the Tenant to be kept and performed during the term hereof. Tenant agrees that if the Tenant shall fail to pay the rent herein reserved or any other sum required hereby promptly when due, said deposit may, at the option of the Landlord (but Landlord shall not be required to) be applied to any rent or other sum due and unpaid, and if the Tenant violates any of the other terms, covenants, and conditions of this Lease, said deposit may, at Landlord's option, be applied to any damages suffered by Landlord as a result of Tenant's default to the extent of the amount of the damages suffered. 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. Should the entire security deposit, or any portion thereof, be appropriated and applied by Landlord for the payment of overdue rent or other sums due and payable to Landlord by Tenant hereunder, then Tenant shall, on the written demand of Landlord, forthwith remit to Landlord a sufficient amount in cash to restore said security deposit to its original amount, and Tenant's failure to do so within five (5) days after receipt of such demand shall constitute a breach of this Lease. Should Tenant comply with all of the terms, covenants, and conditions of this Lease and promptly pay all of the rental herein provided for as it falls due, and all other sums payable by Tenant to Landlord hereunder, said security deposit shall be returned in full to Tenant at the end of the term of this Lease, or upon the earlier termination of this Lease as specified herein except in the event the Premises are sold as a result of the exercise of any power of sale under any mortgage or deed of trust, in which event this Lease shall be automatically amended to delete any reference to this Section and Tenant shall be entitled to immediate reimbursement of its security deposit from the party then holding said deposit. 5 AMENDED AND RESTATED LEASE 538963 1 4.0 USE OF THE PREMISES 4.1 Permitted Use. The Landlord hereby leases to Tenant and Tenant hires from Landlord the Premises with appurtenances as defined herein, for the purpose of conducting thereon only the use specified in Section 1.7 of this Lease and for no other use. Tenant may sell refreshments, beer, and other concessions during performances as long as Tenant obtains all necessary licenses. 4.2 Prohibited Uses. Tenant shall not sell or permit to be kept, used, displayed or sold in or about the 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, or (b) any article which may be prohibited by standard forms of fire insurance policies. Tenant shall not use, or permit to be used the Premises or any part thereof for the installation or on-premises use of any vending machine, gaming machine or video or arcade game unless expressly permitted by this Lease. 4.3 Compliance with Laws. Tenant shall, at his own cost and expense, comply with all of the requirements of all municipal, state and federal authorities now in force or which may hereafter be in force pertaining to the use of the Premises, and shall faithfully observe in said use all municipal ordinances, including, but not limited to, the General Plan and zoning ordinances, state and federal statutes, or other governmental regulations now in force or which shall hereinafter be in force. Tenant's violation of law shall constitute an incurable default under this Lease. The judgment of any court of competent jurisdiction, or the admission of Tenant in any action or proceeding against Tenant, whether Landlord is a party thereto or not, that Tenant has violated any such order or statute in said use, shall be conclusive of that fact as between the Landlord and Tenant. Tenant shall not engage in any activity on or about the Premises that violates any Environmental Law, and shall promptly, at Tenants sole cost and expense, take all investigatory and/or remedial action required or ordered by any governmental agency or Environmental Law for clean-up and removal of any contamination involving any Hazardous Material created or caused directly or indirectly by Tenant. The term "Environmental Law" shall mean any federal, state or local law, statute, ordinance or regulation pertaining to health, industrial hygiene or the environmental conditions on, under or about the Demised Premises, including, without limitation, (i) the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), 42 U.S.C. Sections 9601 et seq.; (ii) the Resource Conservation and Recovery Act of 1976 ("RCRA"), 42 U.S.C. Sections 6901 et seq.; (iii) California Health and Safety Code Sections 25100 et seq.; (iv) the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249.5 et seq.; (v) California Health and Safety Code Section 25359.7; (vi) California Health and Safety Code Section 25915; (vii) the Federal Water Pollution Control Act, 33 U.S.C. Sections 1317 et seq.; (viii) California Water Code Section 1300 et seq.; and (ix) California Civil Code Section 3479 et seq., as such laws are amended and the regulations and 6 AMENDED AND RESTATED LEASE 538963 I administrative codes applicable thereto. The term "Hazardous Material" includes, without limitation, any material or substance which is (i) defined or listed as a "hazardous waste", "extremely hazardous waste", "restrictive hazardous waste" or "hazardous substance" or considered a waste, condition of pollution or nuisance under the Environmental Laws; (ii) petroleum or a petroleum product or fraction thereof; (iii) asbestos; and/or (iv) substances known by the State of California to cause cancer and/or reproductive toxicity. It is the intent of the parties hereto to construe the terms "Hazardous Materials" and "Environmental Laws" in their broadest sense. Tenant shall provide all notices required pursuant to the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249.5 et seq. Tenant shall provide prompt written notice to Landlord of the existence of Hazardous Substances on the premises and all notices of violation of the Environmental Laws received by Tenant. 4.4 Signs_ 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 Tenants approval and without any liability to Tenant. 4.5 Parkin 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 nonexclusive 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 Maintenance of Common Areas. During the entire term hereof, Landlord shall keep or cause to be kept the parking and common areas as same are established and completed by Landlord in a good, neat, clean and orderly condition, properly lighted and landscaped, and shall repair any damage to the facilities thereof as well as the exterior walls and roof of the Premises as provided in Article 11_ 4.7 Hours of Business. Subject to the provisions of Section 8.0 hereof, Tenant shall continuously during the entire term hereof Conduct and carry on Tenant's business in the Premises and shall keep the Premises open for business and cause Tenants business to be conducted therein during the usual business hours of each and every business day as is customary for theaters of like character to be open for business in Riverside County. This provision shall not apply if the Premises should be dosed and the business of Tenant temporarily discontinued therein on account of strikes, lockouts,or similar causes beyond the reasonable control of Tenant. It is the intention of Landlord that the Premises are open during evening hours to promote business in the City of Palm Springs and, therefore, Tenant shall participate in any 7 AMENDED AND RESTATED LEASE $3896311 program established by Landlord) to provide evening shopping and entertainment, which program may be administered by such entitythat may be designated by the Landlord. 4.8 Charitable Leases. The provisions of this Section are required by Resolution No. 14527 of the City Council and shall only apply as indicated in Section 1 A 0. Tenant hereby represents and warrants to Landlord that Tenant is exempt from federal income taxation pursuant to Internal Revenue Code Sections 501(c)(1)and/or 501(c)(3)and that Tenants use of the Premises as specified in Section 1.7 is a tax exempt function.Tenant hereby acknowledges that the Monthly Rent is below fair market rental rates and that the fair market rental value of the property is as specified in Section 1.9. Prior to the execution of this Lease,Tenant has provided Landlord with a proposed program for which the Tenant intends to use the Premises ("Program"). On each anniversary of the Commencement Date,Tenant shall submit to Landlord a report, in a form and content satisfactory to Landlord, setting forth Tenants progress in meeting the provisions of the program during that year. If Landlord is not satisfied with the Tenant's performance, Landlord may terminate this Lease upon thirty(30) days'advance written notice to Tenant or increase the Monthly Rent to the fair market rental for the Premises as specified in Section 1.9 (increased pursuant to Section 3.2, if applicable). 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. 4.9 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. 5.0 ALTERATIONS 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, without the prior written consent of Landlord, and any alterations to the Premises, except movable fumbire and trade fixtures, shall become at once a part of the reafty and shall at the expiration or earlier termination of this Lease belong to Landlord.Tenant shall not in any event make any changes to the exterior of the Premises.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. Tenant may leave all equipment and fixtures relating to the operation of the theatre on the Premises with the exception of lighting instruments and control boards, sound boards, microphones, recording and playback equipment.Any removal of alterations or furniture and trade fixtures shall be at Tenants expense and s AMENDED AND RESTATED LEASF. 539963.1 accomplished in a good 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 5.2 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 and Repair. Tenant shall, subject to Landlord's obligations hereinafter provided, at all times during the term hereof, and at Tenant's sole cost and expense, keep, maintain and repair the Premises, and other improvements within the Premises in good and sanitary order, condition, and repair (except as hereinafter provided), including, without limitation, the maintenance and repair of any store front, doors, window casements, walls, glazing, heating and air conditioning system, plumbing, pipes, electrical wiring and conduits. Tenant shall also at its sole cost and expense be responsible for any alterations or improvements to the Premises neoessitated as a result of the requirement of any municipal, state or federal authority- Tenant hereby waives all right to make repairs at the expense of Landlord, and Tenant hereby waives all rights provided for by the Civil Code of the State of Califomia to make said repairs. By entering into the Premises, Tenant shall be deemed to have accepted the Premises as being in good and sanitary 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 good, clean and sanitary condition, reasonable use and wear thereof and damage by fire, act of God or by the elements excepted.Tenant shall periodically sweep and dean the sidewalks adjacent to the Premises, as needed. Upon Tenants possession of the Premises, Tenant shall be deemed to have accepted the Premises as being in good 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. Said consent will be given only upon Landlord's satisfaction that any repairs necessitated as a result of Tenant's action will be made by Tenant at Tenant's expense and will be made in such a manner so as not to invalidate any guarantee relating to said roof. 5.3 Free from Liens. Tenant shall keep the Premises free from any liens arising out of any worm performed, material fumished, or obligation incurred by Tenant or alleged to have been incurred by Tenant. 5.4 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 (90%) of the replacement value of the building containing the Premises, together with such 9 AMENDED AND RESTATED LEASE 538963.1 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 and shall provide plate glass coverage. (b) Tenant to Provide Liability Insurance. During the entire term of this Lease, the Tenant shall, at the Tenant's 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 or provided, 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 Workers' Compensation Insurance. Tenant shall, at the Tenants sole cost and expense, maintain a policy of workers' 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 subrogation and 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 thirty (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 thirty(30)days prior to the expiration of any insurance policy, Tenant shall provide Landlord with endorsements evidencing the above insurance coverages written by insurance companies acceptable to Landlord, licensed to do business in the state to AMENDED.AND RESTATED LEASE 5389631 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 Witten 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 Tenant's trade fixtures, equipment, personal property or inventory arising from any risk generally covered by insurance against the perils of tire,extended coverage,vandalism,malicious mischief,theft, sprinkler damage or leakage, and earthquake. 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 lawful 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 underthis Lease, herebywaives 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 officers, agents 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 negligent 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 parking and common areas by Tenant or its employees and customers, or arising from the failure of Tenant to keep the Premises in good condition and repair, as herein provided, or arising from the negligent acts or omissions of Tenant hereunder,or arising from Tenants 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 or employees but excluding such claims or liabilities arising from the sole negligence or willful misconduct of the Landlord, its officers, agents 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; (b) Tenant will promptly pay anyjudgmerrt rendered against the Landlord, its officers, agents 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 11 AMENDED AND RESTATED LEASE 538963 1 activities of Tenant hereunder,and Tenant agrees to save and hold the Landlord, its officers, agents, and employees harmless therefrom; (c) In the event the Landlord, its officers, agents 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 or employees, any and all costs and expenses incurred by the Landlord, its officers, agents 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; and if Tenant shall abandon, vacate or surrender the Premises 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 itof 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 aufhor¢ed public authorityforany reason otherthan Tenant's act, use or occupation, which declaration requires repairs to the Premises, Landlord shall forthwith make said repairs provided Tenant gives to Landlord thirty (30) days' written notice of the necessity therefor. No such partial destruction (including any destruction necessary in order to make repairs required by any dedaration made by any public authority)shall in any way annul or void this Lease except that Tenant shall be entitled to a proportionate reduction of Monthly Rental while such repairs are being made, such proportionate reduction to be based upon the extent to which the making of such repairs shall interfere with the business carried on by Tenant in the Premises. However, if during the last two(2) years of the term of this Lease the Premises are damaged as a result of fire or any other insured casualty to an extent in excess of twenty-five percent (25%) of the then replacement cost (excluding foundations), Landlord may within thirty (30) days following the date such damage occurs terminate this Lease by written notice to Tenant. If landlord, however, elects to make said repairs, and provided Landlord uses due diligence in making said repairs, this Lease shall continue in full force and effect, and the Monthly Rental shall be proportionately reduced while such repairs are being made as hereinabove provided. Nothing in the foregoing to the contrary withstanding, if the Premises or said building is damaged or destroyed at any time during the term hereof to an extent of more than twenty-five percent (25%) of the then replacement cost (excluding foundations)as a result of a casualty not insured against, Landlord may within thirty (30) days following the date of such destruction terminate this Lease upon written notice to Tenant. If Landlord does not elect to terminate because of said uninsured casualty, Landlord 12 AMENDED AND RESTATED LEASE 532963.1 shall promptly rebuild and repair the Premises and/or the building and the Monthly Rental shall be proportionately reduced while such repairs are being made as hereinabove provided. If Landlord elects to terminate this Lease, all rentals shall be prorated between Landlord and Tenant as of the date of such destruction. In respect to any partial or total destruction (including any destruction necessary in order to make repairs required by any such declaration of any authorized public authority) which Landlord is obligated to repair or may elect to repair under the terms of this Section, Tenant waives any statutory right it may have to cancel this Lease as a result of such destruction. 9.0 ASSIGNMENT AND SUBLETTING.Tenant shall not assign this Lease or sublet all or a portion of the Premises 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 ailing in concert of more than 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 sublessee 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; and (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 subtenants 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 underthis Lease in writing in form satisfactory to Landlord. The proposed assignee shall simultaneously provide to Landlord an estoppel certificate in the form described in Section 12.3 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 (112) 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. 13 AMENDED AND RESTATED LEASE 536963 A 10.0 DEFAULT 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 rental 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 failure to perform any of Tenant's agreements or obligations hereunder (exclusive of a default in the payment of money) where such default shall continue for a period of thirty(30)days after written notice thereof from Landlord to Tenant which notice shall be deemed to be the statutory notice so long as such notice complies with statutory requirements;(c)the vacation or abandonment of the Premises by Tenant;(d)the making by Tenant of a general assignment for the benefit of creditors; (e) the filing by Tenant of a voluntary petition in bankruptcy or the adjudication of Tenant as a bankrupt; (f)the appoirarr ent of a receiver to take possession of all or substantially all the assets of Tenant located at the Premises or of Tenant's leasehold interest in the Premises; (g)the filing by any creditor of Tenant of an involuntary petition in bankruptcy which is not dismissed within sixty(60)days after filing; or(h)the attachmert, execution or otherjudidal seizure of all or substantially all of the assets of Tenant or Tenant's leasehold where such an attachment, execution or seizure is not discharged within sixty(60) days_ Any repetitive failure by Tenant to perform its agreements and obligations hereunder, though intermittently cured, shall be deemed an incurable default. Two (2) breaches of the same covenant within a sixty (60) day period, a notice having been given pursuant to (a) or(b) above for the first breach, or three (3) of the same or different breaches at any time during the term of this Lease for which notices pursuant to (a) or (b) above were given for the first two (2) breaches shall conclusively be deemed to be an incurable repetitive failure by Tenant to perform its obligations hereunder. In the event of any such default or breach by Tenant, Landlord may at any time thereafter, without further notice or demand, rectify or cure such default, and any sums expended by Landlord for such purposes shall be paid by Tenant to Landlord upon demand and as additional rental hereunder. In the event of any such default or breach by Tenant, Landlord shall have the right(I)to continue the lease in full force and effect and enforce all of its rights and remedies under this Lease, including the right to recover the rental as it becomes due under this Lease, or(ii) Landlord shall have the right at any time thereafter to elect to terminate the Lease and Tenant's right to possession thereunder. Upon such termination, Landlord shall have the right to recover from Tenant: (I) The worth at the time of award of the unpaid rental which had been earned at the time of termination; (ii) The worth at the time of award of the amount by which the unpaid rental which would have been earned after termination until the time of award exceeds the amount of such rental loss that the Tenant proves could have been reasonably avoided; (iii) The worth at the time of award of the amount by which the unpaid rental for the balance of the term after the time of award exceeds the amount of such rental loss that the Tenant proves could be reasonably avoided; and 14 AMENDED AND RESTATED LEASL-' 538963.1 (iv) Any other amount necessary to compensate the Landlord for all the detriment proximately caused by Tenant's failure to perfon-n its obligations under the lease orwhich in the ordinary course of things would be likely to result therefrom. The "worth at the time of award" of the amounts referred to in subparagraphs(i) and (ii) above shall be computed by allowing interest at three percent(3%) over the prime rate then being charged by Bank of America, N.A. but in no event greater than the maximum rate permitted by law.The worth at the time of award of the amount referred to in subparagraph (iii)above shall be 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%), but in no event greater than ten percent (10%). As used herein "rental" shall include the Monthly Rental, other sums payable hereunder which are designated "rental' or "additional rental" and any other sums payable hereunder on a regular basis such as reimbursement for real estate taxes. Such efforts as Landlord may make to mitigate the damages caused by Tenant's breach of this Lease shall not constitute a waiver of Landlord's right to recover damages against Tenant hereunder, nor shall anything herein contained affect Landlord's right to indemnification against Tenant for any liability arising prior to the termination of this Lease for personal injuries or property damage, and Tenant hereby agrees to indemnify and hold Landlord harmless from any such injuries and damages, including all attorneys' fees and costs incurred by Landlord in defending any action brought against Landlord for any recovery thereof, and in enforcing the terms and provisions of this indemnification against Tenant. 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 reM 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 Default. Landlord shall not be in default unless Landlord fails to perform obligations required of Landlord within a reasonable time, but in no event later than thirty (30) days after written notice by Tenant to Landlord and to the holder of any first mortgage or deed of trust covering the Premises whose name and address shall have theretofore been furnished to Tenant in writing, specifying wherein Landlord has failed to perform such obligation; provided, however, that if the nature of Landlord's obligation is such that more than thirty (30) days are required for performance then Landlord shall not be deemed in default if Landlord commences performance within a (30) day period and thereafter diligently prosecutes the same to completion. In no event shall Tenant have the right to terminate this Lease as a result of Landlord's default and Tenant's remedies shall be limited to damages and/or an injunction. 15 AMENDED AND RESTATED LEASE 538963.1 11.0 CONDEMNATION. In the event a condemnation or a transfer in lieu thereof results in a taking of any portion of the Premises, Landlord may, or in the event a condemnation or a transfer in lieu thereof results in a taking of twenty-five percent (25W) or more of the Premises, Tenant may, upon written notice given within thirty (30) days after such taking or transfer in lieu thereof, terminate this Lease. Tenant shall not be entitled to share in any portion of the award and Tenant hereby expressly waives any right or claim to any part thereof. Tenant shall, however, have the right to claim and recover, only from the condemning authority (but not from Landlord), any amounts necessary to reimburse Tenant for the cost of removing stock and fixtures. If this Lease is not terminated as above provided, Landlord shall use a portion of the condemnation award to restore the Premises. 12.0 MISCELLANEOUS. 12.1 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. Such Modifications may include, without limitation, the right to construct new buildings on the Property for additional uses, to remove, renovate, repair, add to, modernize or otherwise alter the building in which the Premises are situated as well as other buildings, facilities, structures, malls, walkways, landscaping, parking and common areas or other areas within 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. 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, nor entitle Tenant to damages, injunctive relief or other equitable relief, nor entitle Tenant to any abatement or reduction in the Monthly Rental, additional rental or other charges or sums due under this Lease; provided Landlord uses reasonable efforts to mitigate any adverse effects on Tenant caused by the Modifications. 12.2 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 or for the purpose of maintaining 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 and without any liability to Tenant for any loss of occupation or quiet enjoyment of the Premises thereby occasioned. Tenant shall permit Landlord, at any time within six (6) months prior to the expiration of this Lease, to place upon the Premises 16 AMENDED AND RESTATED LEASE 539963 1 any usual or ordinary "For Lease" signs, and during such (6) month period Landlord or his agents may, during normal business hours, enter upon said Premises and exhibit same to prospective tenants. 12.3 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 "C" addressed to any existing or proposed mortgagee or proposed purchaser, and to the Landlord. Tenant shall be liable for any loss 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. 12A Jurisdiction and Venue. 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. 12.5 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. 12.6 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. 12.7 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. 12.8 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. 17 AMENDED AND RESTATED LEASE 5389631 12.9 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, and that the provisions of this Lease and the agreements relating to rent payable hereunder are included solely for the purpose of providing a method whereby rental payments are to be measured and ascertained. 12.10 Nondiscrimination_ Tenant herein covenants by and for itself, its heirs, executors, administrators and assigns and all persons claiming under or through it, and this Lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any person or group of persons on account of race, sex, marital status, color, creed, national origin or ancestry, in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the Premises herein leased, nor shall the Tenant itself, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sub-lessees, subtenants or vendees in the Premises. 12.11 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 1.8. 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. 12.12 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 parry'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. 12.13 Exhibits and Addenda.The Exhibits and Addenda attached to this Lease are made a part hereof as if fully set forth herein. In the event of a conflict between the terms and provisions of Addenda and the terms and provisions of this Lease,the terms and provisions of the Addenda shall prevail. IN WITNESS WHEREOF,the parties have duly executed this Lease togetherwilh 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 is AMENDED AND RESTATED CEASE 538963.1 �Corporation By: a'mes Thompson, City Cl rk 62d �Z0Q8 Its: APPROVED AS TO FORM: ` APPROVED BY CITY COUNCIL Dough Holland, City Attorney "Tenant" PALM CANYON THEATRE, INC., a non- profit corporation By: �^ Its: l S9 — �'7 By: —a Its: r� 19 AMENDED AND RESTATED LEASE 539963 1 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 southern most half of 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 comer 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. EXHIBIT"A„ AMENDED AND RESTATED LEASE 538963.1 EXHIBIT "B" PLOT PLAN OF DEMISED PREMISES ^ cuts-won AtrA1 { V O < u { S �I f� ryt;w•�w `� �• Cutt•R aan r�+W'ape+ Hrcren it aancc l� A lad•4a� ARC Au a EXFIIBTT"B" AMENDED AND RESTATED LEASE 538963.1 EXHIBIT "C" ESTOPPEL CERTIFICATE Tenant; PALM CANYON THEATRE Landlord: COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, a municipal corporation Date of Lease: Premises: To: The undersigned hereby certifies as follows: 1. The undersigned is the tenant(Tenanf')under the above-referenced lease("Lease") covering the above-referenced premises("Premises"). 2. The Lease constitutes the entire agreement between landlord and Tenant with aspect 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.All improvements to be constructed on the Premises by Landlord have been completed and accepted by Tenant and any tenant construction allowances have been paid in full. 4. As of this date, to the best of Tenants knowledge, there exists no breach or default, nor state of facts which,with notice,the passage of time,or bath,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 Annual Rent in installments of $1,669.36 per month, and such monthly installments have been paid not more than one month in advance. To the best of Tenants 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$2,500.00 which was paid pursuant to the Lease. 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 EXHIBIT"C" AMENDED AND RESTATED LEASE 5399G3.1 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,any petition seeking reorgan¢ation 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: EXHIBIT"C" AMENDED AND RESTATED LEASE 539963.1 EXHIBIT "D" RULES AND REGULATIONS 1_ All loading and unloading of goods shall be done only at the times, in the areas and through the entrances reasonably designated for such purposes by Landlord. 2. The delivery or shipping of merchandise, supplies and fixtures to and from the Premises shall be subject to such rules and regulations as in the reasonable judgment of Landlord are necessary for the proper operation of the Premises or of the Property generally. 3. All of Tenant's refuse and rubbish shall be removed to central trash bins located in the Property, at Tenant's sole cost and expense. 4. 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. 5. 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. 6. 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 Tenants Lease. 7. Tenant shall not burn any trash or garbage of any kind in or about the Premises or the Property generally. 8_ Tenant will not allow animals, except seeing-eye dogs and/or those animals used in theatre productions, in, about or upon the Premises. 9. 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. 10. 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. EXH18IT"D" AMENDED AND RESTATED LEASE 538963.1 11. Tenant shall keep all window displays in a clean and orderly fashion. If merchandise is to be shown in the window displays, such merchandise shall be changed at least every other month. landlord shall have the right to require the removal or change of any window display it finds, in its sole and absolute judgment, unattractive or objectionable. EXHIBIT"D" AMENDED AND RESTATED LEASE 538963.1 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 six (6) professional quality indoor theatre productions on the Premises per season during the months of October through May with a minimum of five (5) performances per week for four (4) weeks each 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 late August/early September each year, and in addition, for film screenings ("Screenings") by the Palm Springs International Film Society, a California nonprofit corporation ("PSIFS") 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 PSIFF 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 PSIFF and its patrons during such events. Tenant shall provide the theatre to the PSIFF/PSIFS clean and free of debris (inside lobby, projection booth, stage, bathrooms, auditorium and outside walkways), and ready for use for festivals and screenings. Tenant shall allow PSIFF/PSIFS use of the marquee(s) during Film Festivals and monthly film screenings. In consideration of the substantial contributions and improvements to the Theatre previously made by the PSIFF and hereby acknowledged by the City, no rental fee is to be charged by the Tenant to the PSIFF or PSIFS for use of the Premises except for the reimbursement of the pro rata share of the Tenant's utility and building maintenance direct costs actually incurred during the Film Festival time frame. During Short Film Festival in August, the Tenant is not in production and their use of the facility is limited. PSIFF/PSIFS shall contribute to electric bills in an amount over the baseline use in previous years, prorated on the basis of Tenant's vs. PSIFF/PSIFS's use of the facility during that month. 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 EXI•IIBIT"E" AMENDED AND RESTATED LEASE 5389G3 I 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, 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. EX14im r"E" AMENDED AND RESTATED LEASE sasw. i FOURTH AMENDMENT TO LEASE 538 North Palm Canyon Drive Palm Canyon Theatre THUFOURTH AMENDMENT TO LEASE ("Fourth Amendment")is made on this lbf day of 12006 by and between the CITY OF PALM SPRINGS, a California muni ipal corporation ("City") and THE PALM CANYON THEATRE, INC., a non-profit corporation("Tenant")- RECITALS A. On July 9, 1997, Tenant entered into that certain Lease Agreement("Lease") for a portion of real property described at Exhibit"A"attached and incorporated to the Lease ("Premises"). B. On October 1, 1997, City and Tenant entered into that certain Amendment to Lease, increasing Tenant's exclusive use of floor area at the Premises, increasing the monthly rental and prepaid rent amount, and allowing certain Tenant electrical improvements and repairs on the Premises. C. On June 17, 1998, City and Tenant entered into that certain Amendment and Addendum to adjust the rent to reflect the cost of public improvements made by Tenant,to clarify the responsibility for certain public improvements, and to change the accounting requirements of the Lease. D. On June 5,2002, Tenant and City amended the lease granting an additional five years of lease. E. On October 4,2006, City Council approved Amendment#4 to the lease agreement with the Tenant for the purpose of incorporating and coordinating tenant improvements with the Palm Springs International Film Festival,making a $200,000 Tenant improvement allowance to Tenant for the City owned property located at 538 North Palm Canyon Drive. The parties hereto now desire to amend the Lease upon the terms and conditions contained herein. COVENANTS NOW, THEREFORE, for fair and valuable consideration,the receipt and adequacy of which is hereby acknowledged,the parties hereto now further amend the Lease by adding the following subsection to the Lease: Section 5.1.1 City will reimburse Tenant or otherwise pay for,up to $200,000 for the coordination of Tenant improvements with the Palm Springs International Film Festival incurred prior to the 2007 Film Festival. Tenant shall submit a list of improvements for review by City Manage. Tenant and Palm Springs International Film Festival shall contract for work to be done and submit a draw request as shown on Attachment 1, completed and signed by Contractor, Tenant and Palm Springs International Film Festival upon satisfactory completion of work. FULL FORCE AND EFFECT. Except as specifically provided in this Amendment, all terms and conditions in the lease shall remain unmodified and in full force and effect. IN WITNESS WIIEROF,the parties hereto have executed the Amendment the day and year first written above. ,City" ATTEST: CITY OF PALM SPRINGS, a municipal = Corporation Sd"ur',Cc;': .'�t Its: APPROVED BY CITY APPROVED AS TO FORM: a���� S0:t =oo - gjx//� N5156 City Atto ey "Tenant" PALM CANYON THEATRE,INC., a non- profit corporation Its: By: Its: Palm Canyon Theatre Improvements Item Description Estimated Cost Schedule 35 mm projection system including sound, Equipment retrtactabIs screen and electrica€ $196,000.00 Dec 15-31 Expanded Projection Booth IConstruction, windows, doors floor and paint $60,000.001Dee 16-31 Replace Theatre Seats Ilrwin Theatre Seats, including new numbering $14,947.32 Dec 22-31 Stage Curtains and Track !DaClerc j $24,156.66 Dec 20-31 Theatre Lighting Wall sconces, stairway lighting $10,000.00 Complete Marquee and Exterior Lighting Per approval of AAC $5,000.00 After January 2007 Box office DSL and Improvements 'Verizon working on DSL $3,500.00 Dec 4-15 ✓ New Carpeting Wavelength Pattern called COSMIC $12,587.40 Dec 20-22 Replace Tile in Lobby Charcoal Grey Ceramic Tile $10,500.00 Dee 4-15 ✓ Major Cleaning and Mold Removal $2,800.00 Complete Air Conditioning and Servicing (complete) Desert Air-Lobby Compressor $9,930.00iAfter January 2007 Paint Dunn Edwards#439 DEA 150 $5,800.00 Dec 20-24 Architectural Design Projection booth, later bathrooms $10,000.00 Complete Miscellaneous Repairs $5,000.001Ongoing Restrooms Complete Replacement of Men's and Women's After January 2007 Outdoor Landscaping of Courtyard After January 2007 TOTAL $360,2 11.38 Table prepared based on information provided by Palm Springs international Film Festival and Ken McNeal City of Palm Springs Community Redevelopment Agency 2116/2007 Palm Canyon Theatre, Inc Lease AGREEMENT 13785 Amend 3 M07090, 6-5-02 THIRD AMENDMENT TO LEASE — — — 538 North Palm Canyon Drive Palm Canyon Theater THIS THIRD AMENDMENT TO LEASE ("Third Amendment") is made this day of , 2002 by and between the CITY OF PALM SPRINGS, a California municipal corporation ("City"), and THE PALM CANYON THEATRE, INC. a non-profit corporation ("Tenant"). R ECITALS A On July 9, 1997, Tenant entered into that certain Lease Agreement ("Lease") for a portion of real property described at Exhibit "A" attached and incorporated to the Lease ("Premises"). B. On October 1, 1997, City and Tenant entered into that certain Amendment to Lease, increasing Tenant's exclusive use of floor area at the Premises, increasing the monthly rental and prepaid rent amount, and allowing certain Tenant electrical improvements and repairs on the Premises. C. On June 17, 1998, City and Tenant entered into that certain Amendment and Addendum to adjust the rent to reflect the cost of public improvements made by Tenant, to clarify the responsibility for certain public improvements, and to change the accounting requirements of the Lease. D. On January 18, 2002, Tenant informed the City of its desire to exercise its option for an additional five years of lease. The parties hereto now desire to amend the Lease upon the terms and conditions contained herein. COVENANTS NOW, THEREFORE, for fair and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto now further amend the lease in the following particulars only: Section 1.3. Lease Commencement Date. May 1, 1997. Term: 10 years. Lease termination Date: April 30, 2007. Section 1.5. Monthly Rental. The lease shall be $1,400 per month, adjusted annually under the provisions of Section 3.2. Section 1.8. Use of Premises. Add "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." Section 3.7. Late Payment. Add at the end of the paragraph: "Sixty (60) days before the anniversary date each year (March 1) the City shall notify the Tenant of any outstanding delinquency, which must be cured prior to the anniversary date or the City may exercise its right of termination under Section 2.5 and terminate the lease. FULL FORCE AND EFFECT. Except as specifically provided in this Amendment, all terms and conditions in the lease shall remain unmodified and in full force and effect. IN WITNESS WHEREOF, the parties hereto have executed the Amendment the day and year first written above. "City" ATTEST: CITY OF PALM SPRINGS, a municipal corporation �/ do By. Its: �I APPROVED AS TO FORM: City A taFF� y gY V�1 8 a, OC7 "Tenant" PALM CANYON THEATRE )INC., a non profit corporation r( By: v,'r� l,k� p ,f 1 _ lJ � r Its: ✓��J�`rf,.dh:2. 4, 4 I � �a By: �( //��� 7% ✓ Its: The Palm Canyon Theatre, Inc. Amend #2 to Lease 0 is AGREEMENT #3785 M06166, 6-17-98 SECOND AMENDMENT TO LEASE AND ADDENDUM THIS SECOND AMENDMENT TO LEASE (�"Secon 1dAmen ment") is made this day of June, 1998, by and between the CITY OF PALM SPRINGS, a California municipal corporation ("City"), and TIIE PALM CANYON THEATRE, INC., a non-profit corporation ("Tenant"). RECITALS A. On July 9, 1997, Tenant entered into that certain Lease Agreement ("Lease") for a portion of real properly described at Exhibit "A" attached and incorporated to the Lease ("Premises"). B. On October 1, 1997, City and Tenant entered into that certain Amendment to Lease, increasing Tenant's exclusive use of floor area at the Premises, increasing the monthly rental and prepaid rent amount, and allowing certain Tenant electrical improvements and repairs on the Premises. C. City wishes to make necessary structural improvements to the Premises to allow for continued use of the theatre facility for public assembly. D. Tenant and City wish to amend and extend the Monthly Rental of the Lease to provide an offset of $18,450.00 to the Monthly Rental for City approved expenditure made by Tenant on common area improvements to the Frances Stevens Park Facilities. The parties hereto now desire to amend the Lease upon the terms and conditions contained herein. COVENANTS NOW, TIIEREFORE, for fair and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto now amend the lease in the following particulars only: Section 3 of the Lease shall be supplemented, and immediately below the existing paragraph at subsection 3.10, shall read as follows: 3.10 Monthly Rental Offset. In consideration of improvements made by Tenant to common areas of the Premises, which improvements are the property of City and shall revert to City upon termination of Lease, Landlord agrees to offset the Monthly Rental ("Monthly Rental Offset") by EIGHTEEN TIIOUSAND FOUR HUNDRED FIFTY AND 00/100 DOLLARS ($18,450.00), representing improvements of twenty thousand 627/014084-0001/3168691.1 a06/11/98 seven hundred fifty and 00/100 dollars ($20,750), minus the structural improvements made by City, as described in Section 5.6 herein. The parties hereby agree that, unless reduced by costs in excess of the Improvement Costs set forth at Section 5.6 herein, City shall pay the Monthly Rental Offset by suspending Tenant's obligation to pay the Monthly Rental due City pursuant to Section 1.5 of the Lease for fourteen (14) months, beginning and including the months Of June 1998 and ending July 1999, with rent commencing on August 1999. On August 1999, Landlord shall pay three hunched ninety and 00/100 dollars ($390.00), representing the difference between the balance of the Monthly Rental Offset and the Monthly Rental due on August 1999. On September 1999, Tenant shall resume payments to City of the Monthly Rental due City IMBLMNA to Section 1.5 of the Lease for the Term of the Lease. Section 5 of the Lease shall be supplemented, and immediately below the existing paragraph at subsection 5.6, shall read as follows: 5.6 Structural Improvement and Repairs. At the City's sole cost, not to exceed TWO THOUSAND THREE HUNDRED AND 00/100 DOLLARS ($2,300.00) City agrees to perform certain structural improvements and repairs to the structure on the Premises as specified by plans provided by City's Building Department, and as proposed by PSI General Contractors in the PSI proposal, a copy of which is on file at the City, (collectively "Improvements"). Should the cost of the Improvements exceed the maximum amount of $2,300.00 ("Improvement Costs"), Tenant agrees to pay, and City is not responsible for any portion of, any such excess costs. Any costs exceeding the Improvement Costs herein shall be chargeable against Tenant by an equal reduction in the Monthly Rental Offset set forth at Section 3.10 herein. Tenant agrees that Section 12.2 of the Lease, wherein Tenant agreed to permit City and its agents to enter the Premises, specifically applies and is extended to the City's right to enter the Premises and inspect and perform the Improvements thereon. Tenant agrees that any and all Improvements provided for in this Section 5.6 shall become part of the Premises and upon the termination of the Lease, City shall retain sole and exclusive ownership of any such Improvements. Tenant agrees that it shall not be entitled to any reimbursement for the Improvements, whether or not the cost of such Improvements exceeds the amount paid by City pursuant to this Section 5.6. Section 12 of the Lease shall be supplemented, and immediately below the existing paragraph at subsection 12.14, shall read as follows; 6271014084-0001/3168691.1 a06/11/98 -2- 12.14 Reports. In consideration of the obligations of City to make the Improvements, as set forth at Section 5.6 herein, Tenant agrees to submit to City the following reports: 1. Quarterly accounts payable aging reports, as regularly maintained by Tenant in a format acceptable to the City, at the end of each quarter for each year during the Term of the Lease; and 2. A financial status report at the end of the 1998 season, in a format acceptable to the City, showing all expenses related to the operation of the theatre at the Premises. FULL FORCE AND EFFECT. Except as specifically provided in this Amend entl,all dendum terms and conditions in the Lease shall remain unmodified and in full force and effect. and Addendum IN WITNESS WHEREOF, the parties hereto have executed this Amelldme4 the day and year first written above. "City" ATTEST: CITY OF PALM SPRINGS, a municipal corporation By: City'Clerk Its:_ APPROVED AS TO FORM: city Att ney Tenant agrees to this Amendment subject to the Addendum attached hereto. "Tenant" PALM CANYON 'THEATRE, INC., a Non-Profit Corporation APPROVED By TX" (.171 07),L llt L 122L) ���-' —/� /i� ..ram,.__., By: rZD Its: tw'"'C'e,t u 7` V C'V�C- 627/014084-OOOI/3168691,1 a06A 1/98 —3— �J ADDENDUM TO SECOND AMENDMENT TO LEASE 1. Section 5 of the Lease and Second Amendment shall be supplemented, and immediately below Section 5.6, as amended, the following language shall be added: 5.7 Whereas, Tenant has already spent in excess of$273,907.37 on improvements to the premises, Tenant's consent to this provision and Tenant's liability hereunder are conditioned on Tenant's prior written approval of PSI's proposal. 2. Section 12 of the Lease and Second Amendment shall be supplemented and immediately below Section 12.14, as amended, the following language shall be added: 12.15 Tenant does not maintain quarterly accounts payable aging reports. Tenant does not know what accounting formats are acceptable to the City and Tenant does not agree to assume any additional accounting burden. However, Tenant is an IRC 501(c)(3) non-profit corporation, and Tenant agrees that those records reasonably requested by the City on reasonable notice to assure Tenant's compliance with the lease and Tenant's continued non-profit status will be made available. Dated: September 4 1998 Tenant: PALM CANYON THEATER, INC. A Non-Profit Corporation By Its JI The Palm Canyon Theatre, Inc. • Amendment to Lease AGREEMENT #3785 M06033, 10-1-97 AMENDMENT TO LEASE THIS AMENDMENT TO LEASE ("Amendment") is made this 1st day of October, 1997, by and between the CITY OF PALM SPRINGS, a California municipal corporation ("City"), and THE PALM CANYON THEATRE, INC., a non-profit corporation ("Tenant"). ;RECITALS A. On July 9, 1997, Tenant entered into that certain Lease Agreement ("Lease") for a portion of real property described at Exhibit "A" attached and incorporated to the Lease ("Premises"). B. Tenant is planning a gala opening and first production of a live performance at the structure erected on the Premises; known as the Palm Canyon Theatre, and wishes to perform certain improvements to the electrical system of the structure prior to said gala opening. Tenant and City wish to have Tenant perform said improvements to said structure pursuant to the terms and conditions contained herein. C. Tenant further wishes to increase the leased area under the Lease to encompass the entire Premises at 538 North Palm Canyon Drive, and the parties wish to set forth the terms and conditions herein of the amended leased area. D. Tenant and City wish to amend and extend the completion date for Tenant's construction work performed pursuant to Section 5.1 of the Lease and described at Exhibit "E" therein. The parties hereto now desire to amend the Lease upon the terms and conditions contained herein. COVENANTS NOW, THEREFORE, for fair and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto now amend the lease in the following particulars only: The following sections of the Lase shall be amended as follows: 1.2. Approximate Floor Area of Premises. Ten thousand seven hundred and fifty five (10,755) square feet of exclusive use. 1.5. Monthly Rental. One thousand two hundred ninety dollars ($1,290.00)per month, representing a monthly rate of twelve cents per square foot of leased space. See Section 3.1 of Lease.) 1.7. Prepaid Rent. One thousand two hundred ninety dollars ($1,290.00). 627/014084-0001/3108855.1 .10/07/97 AND/OR ORIGIN-AL au u The Plot Plan attached as Exhibit "B", as described at Section 1.1 shall be amended and replaced by the Plot Plan attached hereto and incorporated herein as Exhibit "B". The completion date for alterations and improvements of October 15, 1997, as described at Section 5.1 and set forth at Exhibit "E" of the Lease, shall be amended and replaced by the new completion date of November 30, 1997. . Section 5 of the Lease shall be supplemented, and immediately below the existing paragraph at subsection 5.4, shall read as follows: 5.5. Electrical Improvement and Repairs. a. At the City's sole cost, not to exceed twenty five thousand five hundred dollars ($25,500.00), Tenant agrees to install certain electrical improvements and repairs to the structure on the Premises as specified by plans provided to Tenant by City (collectively "Improvements"). Should the cost of the Improvements exceed the maximum amount of twenty five thousand five hundred dollars ($25,500.00), Tenant agrees to pay, and City is not responsible for any portion of, any such excess costs. b. The Improvements shall be performed by a licensed contractor selected by Tenant and subject to the City's approval. Tenant covenants that the work and services required for the Improvements shall be, performed pursuant to the highest professional standards and that all materials used for the Improvements shall be of good quality and fit for the purpose intended. C. Tenant agrees that completing the Improvements in a timely fashion, or prior to Tenant's planned gala opening, shall be Tenant's sole responsibility. Tenant agrees that the City shall be held harmless for any delays in the completion of the Improvements, pursuant to Section 5.5f. below. d. Tenant agrees that Section 12.2 of the Lease, wherein Tenant agreed to permit City and its agents to enter the Premises, specifically applies and is extended to the City's right to enter the Premises and inspect the Improvements and work performed thereon. 627/014084-0001/3108855.1 .10/07/97 -2- C. City shall pay the costs of the Improvements, not to exceed twenty five thousand five hundred dollars ($25,500.00), to Tenant within thirty (30) days of the date in which Tenant completes the Improvements to the satisfaction of City, as certified by the City Engineer. f. Tenant agrees to indemnify and hold the City harmless, pursuant to section 6.3 of the Lease, for any and all electric work performed under this section 5.5. Tenant herein acknowledges that section 6.3 of the Lease shall specifically apply to the Improvements and work performed thereon. g. Tenant agrees that any and all Improvements provided for in this section 5.5 shall become part of the Premises and upon the termination of the Lease, City shall retain sole and exclusive ownership of any such Improvements. Tenant agrees that it shall not be entitled to any reimbursement for the Improvements, whether or not the cost of such Improvements exceeds the amount paid. by City pursuant to this Section 5.5. FULL FORCE AND EFFECT. Except as specifically provided in this Amendment, all terms and conditions in the Lease shall remain unmodified and in full force and effect. 627/014084-000113108855.1 a10/07197 -3- IN WITNESS WHEREOF, the parties hereto have executed this Amendment the day and year first written above. "City" ATTEST: CITY_.QF­PAL NGS, a municipal ,orporaflon !�� a By: City Clerk Its: Mi ,r L,9s c vity" APPROVED AS TO FORM: City Attorney "Tenant" PALM CANYON THEATRE, INC., a Non-Profit Corporation By: Its: G�s� 627/014094-0001/3108855.1 a10107197 4- EXHIBIT NB- PLOT PLAN OF THE PROPERTY SHOWING THE LOCATION OF DE141SED PREMISES 0 U A4c ADE a . Y J I Lcr e rUl.[T IG I ARCADE S, a � nsu Irn r I 1 611 LS 7DILET ---- A � A r I O y n o � > . m e . I A n n } I A I � I O I P 3 I . O I r II O TABLE OF CONTENTS Pave 1. LEASE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . 1 1.1 Premises . . . . . , . . . . . . . . . . . . . . 1 1 .2 Approximate Floor Area of Premises . . . . . . . . . . . . 1 1.3 Lease Commencement Date . . . . . . . . . . . . . . . . . . 1 1.4 Extension Options . . . . . . . . . . . . . . . . . . . . 1 1.5 Monthly Rental . . . . . . . . . . . . . . . . . . . . . . 1 1.6 Security Deposit . . . . . . . . . . . . . . . . . . . . . 1 1.7 Prepaid Rent . . . . . . . . . . . . . . . . . . . . . . 1 1.8 Use of Premises . . . . . . . . . . . . . . . . . . . . . . 1 1.9 Address for Notices . . . . . . . . . . . . . . . . . . . . 1 1.10 Charitable Lease . . . . . . . . . . . . . . . . . . . . 1 2. TERM . . . . . . . . . . . . . . . . . . . . . . . . . 1 2 .1 Initial Term . . . . . . . . . . . . . . . . . . . . . . . 1 2.2 Option Term . . . . . . . . . . . . . . . . . . . . . . . 1 2 .3 Time . . . . . . . . . . . . . . . . . . . . . . . . . 1 2.4 Force Maj eure . . . . . . . . . . . . . . . . . . . . 1 2.5 Termination By Landlord . . . . . . . . . . . . . . . . . 2 2.6 Holding Over . . . . . . . . . . . . . . . . . . . . . . . 2 3 . RENTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 3 .1 Monthly Rental . . . . . . . . . . . . . . . . . . 2 3 .2 Cost of Living Adjustment . . . . . . . . . . . . . . . . 2 3 .3 Additional Rental . . . . . . . . . . . . . . . . . . . . . 2 3 .4 Real Property Taxes . . . . . . . . . . . . . . . . . . . . 2 3 .5 Personal Property Taxes . . . . . . . . . . . . . . 2 3.6 Utilities . . . . . . . . . . . . . . . . . . . . . . . . . 3 3 .7 Late Payment . . . . . . . . . . . . . . . . . . . . . . . 3 3.8 Interest . . . . . . . . . . . . . . . . . . . . . . 3 3 .9 Security Deposit . . . . . . . . . . . . . . . . . . . . 3 4 . USE OF THE PREMISES . . , . . . . . . . . . . . . . . . . . . 3 4.1 Permitted Use . . . . . . . . . . . . . . . . . . . . . . . 3 4 .2 Prohibited Uses . . . . . . . . . . . . . . . . . . . . . . 3 4.3 Compliance with Laws . . . . . . . . . . . . . . . . . . . 3 4,4 Signs . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 4.5 Parking and Common Areas . . . . . . . . . . . . . . . . . 4 4 .6 Maintenance of Common Areas . . . . . . . . . . . . . . . . 4 4.7 Hours of Business . . . . . . . . . . . . . . . . . . . . . 4 4 .8 Charitable Leases . . . . . . . . . . . . . . . . . . . . . 4 4.9 Rules and Regulations . . . . . . . . . . . . . . . . . . . 5 S . ALTERATIONS AND REPAIRS . . . . . . . . . . . . . . . . . . . . 5 5.1 Alterations and Fixtures . . . . . . . . . . . . . . . . . 5 5.2 Maintenance and Repair . . . . . . . . . . . . . . . 5 5.3 Free from Liens . . . . . . . . . . . . . . . . . . . 6 5.4 Additional Consideration For Lease . . . . . . . . . . . . 6 6. INSURANCE AND INDEMNIFICATION . . . . . . . . . . . . . . 6 6.1 Insurance Provided by Landlord . . . . . . . . . . . . . . 6 6.2 Insurance Provided by Tenant . . . . . . . . . . . . . . . 6 6.3 Indemnification of Landlord . . . . . . . . . . . . . . . . 7 7. ABANDONMENT AND SURRENDER . . . . . . . . . . . . . . . . . . . . 7 7 .1 Abandonment . . . . . . . . . . . . . . . . . . . . . . . . 7 7.2 Surrender of Lease . . . . . . . . . . . . , , . . . . . 7 8. DAMAGE AND DESTRUCTION OF PREMISES . . . . . . . . . 7 9 . ASSIGNMENT AND SUBLETTING . . . . . . . . . . . . . . . . . . . . 8 10. DEFAULT AND REMEDIES . . . . . . . . . . . . . . . . . . . . . . . 8 10.1 Default by Tenant . . . . . . . . . . . . . . . . . . . . . 8 10.2 No Waiver . . . . . . . . . . . . . . . . . . . . 9 10.3 Landlord' s Default . . . . . . . . . . . . . . . . . . . . 10 11. CONDEMNATION . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 12. MISCELLANEOUS . . . . . . . . . . . . . . . . _ 10 12 .1 Reservation of Right to Modify Property . . . . . . . . . . 10 12.2 Entry and Inspection . . . . . . . . . . . . . . . . . 10 12.3 Estoppel Certificate . . . . . . . . . . . . . . . . . . . 10 12 .4 Jurisdiction and Venue . . . . . . . . . . . . . . . . 10 12 .5 Partial Invalidity . . . . . . . . . . . . . . . . . . . 11 12.6 Successors in Interest . . . . . . . . . . . . . . . . . . 11 12 .7 No Oral Agreements . . . . . . . . . . . . . . . . . . . . 11 12.8 Authority . . . . . . . . . . . . . . . . . . . . 11 12.9 Relationship of Parties . . . . . . . . . . . . . . . . . . 11 12,10 Nondiscrimination . . . . . . . . . . . . . . . . . . . . . 11 12.11 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . 11 12.12 Waiver . . . . . . . . . . . . . . . . . . . . it 12.13 Exhibits and Addenda . . . . . . . . . . . . . . . . . . . 12 4871014084-0 1?3066M 1 0611 IM -i- Palm Canyon Theatre, inc. • • 5-yr Lease - Term 4-30-2002 AGREEMENT #3785 MO5927, 4-2-97 L E A S E THIS LEASE ("Lease") is made and entered into this day of > �- , 1997, by and between the CITY OF PALM SPRINGS, a municipal corpo ti n ("Landlord") , and THE PALM CANYON THEATRE, INC. , a non-profit corporation ("Tenant") . 1. 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 County of Riverside, State of California, as more particularly described in Exhibit "A11 hereof together with the improvements located thereon and as depicted on the Plot Plan attached as Exhibit "B" hereof. 1.2 Approximate Floor Area of Premises. 5,200 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. May 1, 1997. Term: 5 years. Lease Termination Date: April 30, 2002 . (See Section 2 .1.) 1.4 Extension Options. One (1) option for a term of five (5) years (See Section 2.2. ) 1 .5 Monthly Rental. $795. (See Section 3 .1.) 1.6 Security Deposit. $2,500. (See Section 3.9 .) 1.7 Prepaid Rent. $795. 1.8 Use of Premises. Non-profit professional actors, equity/non- equity live indoor theatre; including an approximately 250-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. (See Section 4 .1.) . 1.9 Address for 'Notices. Tenant: The Palm Canyon Theatre 538 North Palm Canyon Drive Palm Springs, CA 92662 Attn: Dr. William J. Layne or Mr. J.W. Layne Landlord: City of Palm Springs 3200 East Tahquitz Canyon Way Palm Springs, CA 92663 Attn: Economic Development Director 1.10 Charitable Lease. If Section 4.7 of this Lease relating to charitable leases is applicable, please mark here X If Section 4 .7 is applicable, the fair market rental value of the Premises is $9, 000.00 per month. 2. TERM. 2.1 Initial Term. The initial term of this Lease shall commence on the date specified in Section 1.2 ("Commencement Date") and shall continue for the period specified therein unless earlier terminated as provided herein. 2.2 Option Term. Tenant is given the option(s) to extend the term on all of the provisions contained in this Lease for the period specified in Section 1.3 ("extended term") following the expiration of the initial term or any other extended term properly exercised hereunder, by giving notice of exercise of the option ("option notice") to Landlord at least one hundred twenty (120) days but not more than six (6) months before the expiration of the initial term or any other extended term properly exercised hereunder. Provided that, if Tenant is in default on the date of giving the option notice, the option notice shall be totally ineffective, or if Tenant is in default on the date the extended term is to commence, the extended term shall not commence and this Lease shall expire at the end of the initial term or properly exercised extended term. 2 .3 Time. Time is of the essence of this Lease. 2.4 Force Maleure. If either party hereto shall be delayed or prevented from the performance of any act required hereunder by reason of acts of God, strikes, lockouts, labor troubles, inability to procure materials, restrictive governmental laws or regulations or other cause without fault and beyond the control of the party obligated (financial inability excepted) , 4"]N19094L 1/3066W2.3 .06/1 HV 0 • 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, provided such party provides the other party written notice of such event within ten (10) days of the commencement of the delay; provided, however, nothing in this Section shall excuse Tenant from the prompt payment of any rental or other charge required of Tenant hereunder except as may be expressly provided elsewhere in this Lease. 2 .5 Termination By Landlord. Landlord shall have the right to terminate this Lease effective on any anniversary of the Commencement Date, with or without cause, by providing Tenant with at least thirty (30) days' advance written notice. If Landlord terminates this Lease pursuant to this Section, Landlord shall pay Tenant the unamortized portion of the Improvement Costs that are amortized pursuant to Section 5.1. If Landlord terminates 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 and relocation benefits, inverse condemnation or the taking of property and Landlord shall have no obligation to pay Tenant therefor. 2 .6 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 at a monthly rental equal to Nine Thousand Dollars ($9,000.00) and upon terms and conditions as existed during the last year of the term hereof. 3 . RENTAL. 3 .1 Monthly Rental. 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, 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 12.11 hereof. 3 .2 Cost of Living Adjustment. Upon each anniversary date of the 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, 1989, the index to be used for the numerator is the index for the month of March 1989 and 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, All Urban Consumers (All Items) , for the Los Angeles-Anaheim-Riverside Metropolitan Area, published by the United States Department of Labor, Bureau of Labor Statistics (1982-84 = 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. Notwithstanding anything herein to the contrary, Tenant shall be entitled to defer payment of the CPI increases until the date which is three (3) years following the Commencement Date; provided, however, at such time Tenant shall pay all accrued CPI increases over the prior three (3) year period. 3 .3 Additional Rental. For purposes of this Lease, all monetary obligations of Tenant under this Lease, including, but not limited to, insurance premiums, property taxes, maintenance expenses, late charges and utility costs shall be deemed to be additional rental. 3.4 Real Property Taxes. In addition to all rentals herein reserved, Tenant shall pay, at the election of Landlord, either directly to the taxing authority or to Landlord, annual real estate taxes and assessments levied upon the Premises (including any possessory interest taxes) , 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. Such amount shall be paid on the date that is twenty (20) days prior to the delinquent date or, if Landlord receives the tax bill, ten (10) days after receipt of a copy of the tax bill from Landlord, whichever is later. Even though the term of this Lease has expired and Tenant has vacated the Premises, when the final determination is made of Tenant's share of such taxes and assessments, Tenant shall immediately pay to Landlord the amount of any additional sum owed. 3.5 Personal Property Taxes. During the term hereof Tenant shall pay prior to delinquency all taxes assessed against and levied upon fixtures, 48]/"14084- 1/3MM2.3 vM/11/r -2- furnishings, equipment and all other personal property of Tenant contained in the Premises, and when possible Tenant shall cause said fixtures, furnishings, equipment and other personal property to be assessed and billed separately from the real property of Landlord. 3 .6 Utilities. Tenant shall pay before delinquency all charges for water, gas, heat, electricity, power, sewer, telephone service, trash removal and all other services and utilities used in, upon, or about the Premises by Tenant or any of its subtenants, licensees, or concessionaires during the term of this Lease. 3 .7 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 when 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. 3 .8 Interest. Any sum to be paid pursuant to the terms of this Lease not paid when due shall bear interest from and after the due date until paid at a rate equal to three percent (3%-) over the reference rate being charged by Bank of America, N.A. from time to time during such period so long as the rate does not exceed the maximum non-usurious rate permitted by law in which case interest shall be at the maximum non-usurious rate allowed by law at the time the sum became due. 3 .9 Security Deposit. Tenant contemporaneously with the execution of this Lease, has deposited with Landlord the sum specified in Section 1.6 hereof, receipt of which is hereby acknowledged by Landlord, said deposit being given to secure the faithful performance by the Tenant of all terms, covenants, and conditions of this Lease by the Tenant to be kept and performed during the term hereof. Tenant agrees that if the Tenant shall fail to pay the rent herein reserved or any other sum required hereby promptly when due, said deposit may, at the option of the Landlord (but Landlord shall not be required to) be applied to any rent or other sum due and unpaid, and if the Tenant violates any of the other terms, covenants, and conditions of this Lease, said deposit may, at Landlord's option, be applied to any damages suffered by Landlord as a result of Tenant's default to the extent of the amount of the damages suffered. 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. Should the entire security deposit, or any portion thereof, be appropriated and applied by Landlord for the payment of overdue rent or other sums due and payable to Landlord by Tenant hereunder, then Tenant shall, on the written demand of Landlord, forthwith remit to Landlord a sufficient amount in cash to restore said security deposit to its original amount, and Tenant's failure to do so within five (5) days after receipt of such demand shall constitute a breach of this Lease. Should Tenant comply with all of the terms, covenants, and conditions of this Lease and promptly pay all of the rental herein provided for as it falls due, and all other sums payable by Tenant to Landlord hereunder, said security deposit shall be returned in full to Tenant at the end of the term of this Lease, or upon the earlier termination of this Lease as specified herein except in the event the Premises are sold as a result of the exercise of any power of sale under any mortgage or deed of trust, in which event this Lease shall be automatically amended to delete any reference to this Section and Tenant shall be entitled to immediate reimbursement of its security deposit from the party then holding said deposit. 4 . USE OF THE PREMISES. 4.1 Permitted Use. The Landlord hereby leases to Tenant and Tenant hires from Landlord the Premises with appurtenances as defined herein, for the purpose of conducting thereon only the use specified in Section 1.8 of this Lease and for no other use. Tenant may sell refreshments, beer and other concessions during performances as long as Tenant obtains all necessary licenses. 4.2 Prohibited Uses. Tenant shall not sell or permit to be kept, used, displayed or sold in or about the 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, or (b) any article which may be prohibited by standard forms of fire insurance policies. Tenant shall not use, or permit to be used, the Premises or any part thereof for the installation or on-premises use of any vending machine, gaming machine or video or arcade game unless expressly permitted by this Lease. 4 .3 Compliance with Laws. Tenant shall, at his sole cost and expense, comply with all of the requirements of all municipal, state and federal authorities now in force or which may hereafter be in force pertaining to the use of the Premises, and shall faithfully observe in said use all municipal ordinances, including, but not limited to, the General Plan and zoning 41 101J0SM1 113066WM a06lI M -3- ordinances, state and federal statutes, or other governmental regulations now in force or which shall hereinafter be in force. Tenant's violation of law shall constitute an incurable default under this Lease. The judgment of any court of competent jurisdiction, or the admission of Tenant in any action or proceeding against Tenant, whether Landlord be a party thereto or not, that Tenant has violated any such order or statute in said use, shall be conclusive of that fact as between the Landlord and Tenant. Tenant shall not engage in any activity on or about the Premises that violates any Environmental Law, and shall promptly, at Tenant's sole cost and expense, take all investigatory and/or remedial action required or ordered by any governmental agency or Environmental Law for clean-up and removal of any contamination involving any Hazardous Material created or, caused directly or indirectly by Tenant. The term "Environmental Law" shall mean any federal, state or local law, statute, ordinance or regulation pertaining to health, industrial hygiene or the environmental conditions on, under or about the Premises, including, without limitation, (i) the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA") , 42 U.S.C. Sections 9601 et seq. ; (ii) the Resource Conservation and Recovery Act of 1976 ("RCRA") , 42 U.S.C. Sections 6901 et seq. ; (iii) California Health and Safety Code Sections 25100 et seq. ; (iv) the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249 .5 et seq. ; (v) California Health and Safety Code Section 25359 .7; (vi) California Health and Safety Code Section 25915; (vii) the Federal Water Pollution Control Act, 33 U.S.C. Sections 1317 et seq. ; (viii) California Water Code Section 1300 et seq. ; and (ix) California Civil Code Section 3479 et seq. , as such laws are amended and the regulations and administrative codes applicable thereto. The term "Hazardous Material" includes, without limitation, any material or substance which is (i) defined or listed as a "hazardous waste, " "extremely hazardous waste, " "restrictive hazardous waste" or "hazardous substance" or considered a waste, condition of pollution or nuisance under the Environmental Laws; (ii) petroleum or a petroleum product or fraction thereof; (iii) asbestos; and/or (iv) substances known by the State of California to cause cancer and/or reproductive toxicity. It is the intent of the parties hereto to construe the terms "Hazardous Materials" and "Environmental Laws" in their broadest sense. Tenant shall provide all notices required pursuant to the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249 .5 et seq: Tenant shall provide prompt written notice to Landlord of the existence of Hazardous Substances on the premises and all notices of violation of the Environmental Laws received by Tenant. 4.4 Signs. 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 Maintenance of Common Areas. During the entire term hereof, Landlord shall keep or cause to be kept the parking and common areas as same are established and completed by Landlord in a good, neat, clean and orderly condition, properly lighted and landscaped, and shall repair any damage to the facilities thereof as well as the exterior walls and roof of the Premises as provided in Article 11. 4.7 Hours of Business. Subject to the provisions of Section 8.0 hereof, Tenant shall continuously during the entire term hereof conduct and carry on Tenant's business in the Premises and shall keep the Premises open for business and cause Tenant' s business to be conducted therein during the usual business hours of each and every business day as is customary for theaters of like character to be open for business in Riverside County. In no event, however, shall such hours of business be less than (a) 9:00 a.m. through 6:00 p.m, at least five days per week, except for the months of June, July and August of each calendar year. This provision shall not apply if the Premises should be closed and the business of Tenant temporarily discontinued therein on account of strikes, lockouts, or similar causes beyond the reasonable control of Tenant. It is the intention of Landlord that the Premises be open during evening hours to promote business in the City of Palm Springs and, therefore, Tenant shall participate in any program established by Landlord to provide evening shopping and entertainment, which program may be administered by such entity that may be designated by the Landlord. ,187I0140"4-0 113066W28 a061111V -4- 4 .8 Charitable :Leases. The provisions of this Section are required by Resolution No. 14527 of the City Council and shall only apply as indicated in Section 1.10. Tenant hereby represents and warrants to Landlord that Tenant is exempt from federal income taxation pursuant to Internal Revenue Code Sections 501 (c) (1) and/or 501 (c) (3) and that Tenant's use of the Premises as specified in Section 1.8 is a tax exempt function. Tenant hereby acknowledges that the Monthly Rent is below fair market rental rates and that the fair market rental value of the property is as specified in Section 1.10. Prior to the execution of this Lease, Tenant has provided Landlord with a proposed program for which the Tenant intends to use the Premises ("Program") . On each anniversary of the Commencement Date, Tenant shall submit to Landlord a report, in a form and content satisfactory to Landlord„ setting forth Tenant's progress in meeting the provisions of the program during that year. If Landlord is not satisfied with the Tenant' s performance, Landlord may terminate this Lease upon thirty (30) days' advance written notice to Tenant or increase the Monthly Rent to the fair market rental for the Premises as specified in Section 1.10 (increased pursuant to Section 3 .2, if applicable) . If Landlord elects to terminate this Lease, Landlord shall pay Tenant the unamortized portion of the Improvement Costs which are amortized pursuant to Section 5.1. 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. 4.9 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 "DI' ("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 o'n a uniform basis. 5. ALTERATIONS AND REPAIRS. 5.1 Alterations and Fixtures. Except as set forth on Exhibit "Ell attached hereto Tenant shall not make, or suffer to be made, any alterations to the Premises, or any part thereof, without the prior written consent of Landlord, and 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. Tenant shall not in any event make any changes to the exterior of the Premises. 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. Tenant may leave all equipment and fixtures relating to the operation of the theatre on the Premises with the exception of lighting instruments and control boards, sound boards, microphones, recording and playback equipment. Any removal of alterations or furniture and trade fixtures shall be at Tenant's expense and accomplished in a good 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 .2 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") . The Improvement Costs shall be amortized over the remaining initial term of this Lease on a straight line basis in the event of early termination as specified in Sections 2.5 and 4 .7. 5.2 Maintenance and Repair. Tenant shall, subject to Landlord's obligations hereinafter provided, at all times during the term hereof, and at Tenant' s sole cost and expense, keep, maintain and repair the Premises, and other improvements within the Premises in good and sanitary order, condition, and repair (except as hereinafter provided) , including, without limitation, the maintenance and repair of any store front, doors, window casements, walls, glazing, heating and air conditioning system, plumbing, pipes, electrical wiring and conduits. Tenant shall also at its sole cost and expense be responsible for any alterations or improvements to the Premises necessitated as a result of the requirement of any municipal, state or federal authority. Tenant hereby waives all right 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 good and sanitary 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 good, clean and sanitary condition, reasonable use and wear thereof and damage by fire, act of God or by the elements excepted. Tenant shall periodically sweep and clean the sidewalks adjacent to the Premises, as needed. Upon Tenant's possession of the Premises, Tenant shall be deemed to have accepted the Premises as being in good condition and repair. 4H7/014O844WII3066M.3 46/III"] -5 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. Said consent will be given only upon Landlord's satisfaction that any repairs necessitated as a result of Tenant's action will be made by Tenant at Tenant's expense and will be made in such a manner so as not to invalidate any guarantee relating to said roof. 5.3 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. 5.4 Additional Consideration For Lease. As additional consideration for renting the Premises, Tenant agrees to perform the following: (i) construct all improvements in accordance with Exhibit "E" attached hereto at Tenant's sole cost and expense; and (ii) perform the Property management obligations in accordance with Exhibit .,F11 attached hereto. 6. 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 (901s) of the replacement value of the building containing 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 and shall provide plate glass coverage. (b) Tenant to Provide Liability Insurance. During the entire term of this Lease, the Tenant shall, at the Tenant's 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 an amount not less than either (i) a combined single limit of ONE MILLION DOLLARS ($1,000,000.00) for bodily injury, death, and property damage or (ii) bodily injury limits of $250,000.00 per person, $500,000.00 per occurrence and $500,000.00 products and completed operations and property damage limits of $100, 000.00 per occurrence and $250,000.00 in the aggregate; provided, 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 Workers' Compensation Insurance. Tenant shall, at the Tenant's sole cost and expense, maintain a policy of workers' 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 thirty (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 thirty (30) days prior to the expiration of any insurance policy, Tenant shall provide Landlord with certificates of insurance or 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 Best's 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 487JOI4 840Mm 113116 M 3 a1161111W _6_ 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 Tenant's 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, waive 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 officers, agents 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 negligent 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 parking and common areas by Tenant or its employees and customers, or arising from the failure of Tenant to keep the Premises in good condition and repair, 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 or employees but excluding such claims or liabilities arising from the sole negligence Or willful misconduct of the Landlord, its officers, agents 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; (b) Tenant will promptly pay any judgment rendered against the Landlord, its officers, agents 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, and employees harmless therefrom; (c) In the event the Landlord, its officers, agents 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 or employees, any and all costs and expenses incurred by the Landlord, its officers, agents or employees in such action or proceeding, .including, but not limited to, legal costs and attorneys' fees. 7. ABANDONMENT AND SURRENDER. 7.1 Abandonment. Tenant shall not vacate or abandon the Premises at any time during the term of this Lease; and if Tenant shall abandon, vacate or surrender the Premises 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 subtenancies, or may, at the option of Landlord, operate as an assignment to it of any or all of such subleases or subtenancies. S. 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 forthwith make said repairs provided Tenant gives to Landlord 48710W84AW1/31166W23 aW111W -7- thirty (30) days' written notice of the necessity therefor. No such partial destruction (including any destruction necessary in order to make repairs required by any declaration made by any public authority) shall in any way annul or void this Lease except that Tenant shall be entitled to a proportionate reduction of Monthly Rental while such repairs are being made, such proportionate reduction to be based upon the extent to which the making of such repairs shall interfere with the business carried on by Tenant in the Premises. However, if during the last two (2) years of the term of this Lease the Premises are damaged as a result of fire or any other insured casualty to an extent in excess of twenty-five percent (25%) of the then replacement cost (excluding foundations) , Landlord may within thirty (30) days following the date such damage occurs terminate this Lease by written notice to Tenant. If Landlord, however, elects to make said repairs, and provided Landlord uses due diligence in making said repairs, this Lease shall continue in full force and effect, and the Monthly Rental shall be proportionately reduced while such repairs are being made as hereinabove provided. Nothing in the foregoing to the contrary withstanding, if the Premises or said building is damaged or destroyed at any time during the term hereof to an extent of more than twenty-five percent (25%�) of the then replacement cost (excluding foundations) as a result of a casualty not insured against, Landlord may within thirty (30) days following the date of such destruction terminate this Lease upon written notice to Tenant. If Landlord does not elect to terminate because of said uninsured casualty, Landlord shall promptly rebuild and repair the Premises and/or the building and the Monthly Rental shall be proportionately reduced while such repairs are being made as hereinabove provided. If Landlord elects to terminate this Lease, all rentals shall be prorated between Landlord and Tenant as of the date of such destruction. In respect to any partial or total destruction (including any destruction necessary in order to make repairs required by any such declaration of any authorized public authority) which Landlord is obligated to repair or may elect to repair under the terms of this Section, Tenant waives any statutory right it may have to cancel this Lease as a result of such destruction. 9. ASSIGNMENT AND SUBLETTING. Tenant shall not assign this Lease or sublet all or a portion of the Premises 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 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 sublessee, 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 sublessee'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 sublessee 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 sublessee is morally and financially responsible; and (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. 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 Section 12 .3 hereafter. Consent by Landlord to one assignment, subletting, occupation or use by another person shall not be deemed to be a 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. DEFAULT 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 rental 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 failure to perform any of Tenant's agreements or obligations hereunder (exclusive of a default in the 4V/0140844 11306 W2.3 a06/111W -a payment of money) where such default shall continue for a period of thirty (30) days after written notice thereof from Landlord to Tenant which notice shall be deemed to be the statutory notice so long as such notice complies with statutory requirements; (c) the vacation o:r abandonment of the Premises by Tenant; (d) the making by Tenant of a general assignment for the benefit of creditors; (e) the filing by Tenant of a voluntary petition in bankruptcy or the adjudication of Tenant as a bankrupt; (f) the appointment of a receiver to take possession of all or substantially all the assets of Tenant located at the Premises or of Tenant's leasehold interest in the Premises; (g) the filing by any creditor of Tenant of an involuntary petition in bankruptcy which is not dismissed within sixty (60) days after filing; or (h) the attachment, execution or other judicial seizure of all or substantially all of the assets of Tenant or Tenant's leasehold where such an attachment, execution or seizure is not discharged within sixty (60) days. Any repetitive failure by Tenant to perform its agreements and obligations hereunder, though intermittently cured, shall be deemed an incurable default. Two (2) breaches of the same covenant within a sixty (60) day period, a notice having been given pursuant to (a) or (b) above for the first breach, or three (3) of the same or different breaches at any time during the term of this Lease for which notices pursuant to (a) or (b) above were given for the first two (2) breaches shall conclusively be deemed to be an incurable repetitive failure by Tenant to perform its obligations hereunder. In the event of any such default or breach by Tenant, Landlord may at any time thereafter, without further notice or demand, rectify or cure such default, and any sums expended by Landlord for such purposes shall be paid by Tenant to Landlord upon demand and as additional rental hereunder. In the event of any such default or breach by Tenant, Landlord shall have the right (i) to continue the lease in full force and effect and enforce all of its rights and remedies under this Lease, including the right to recover the rental as it becomes due under this Lease, or (ii) Landlord shall have the right at any time thereafter to elect to terminate the Lease and Tenant's right to possession thereunder. Upon such termination, Landlord shall have the right to recover from Tenant: (i) The worth at the time of award of the unpaid rental which had been earned at the time of termination; (ii) The worth at the time of award of the amount by which the unpaid rental which would have been earned after termination until the time of award exceeds the amount of such rental loss that the Tenant proves could have been reasonably avoided; (iii) The worth at the time of award of the amount by which the unpaid rental for the balance of the term after the time of award exceeds the amount of such rental loss that the Tenant proves could be reasonably avoided; and (iv) Any other amount necessary to compensate the Landlord for all the detriment proximately caused by Tenant's failure to perform its obligations under the lease or which in the ordinary course of things would be likely to result therefrom. The "worth at the time of award" of the amounts referred to in subparagraphs (i) and (ii) above shall be computed by allowing interest at three percent (3%) over the prime rate then being charged by Bank of America, N.A. but in no event greater than the maximum rate permitted by law. The worth at the time of award of the amount referred to in subparagraph (iii) above shall be 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&) , but in no event greater than ten percent (10%�) . As used herein "rental" shall include the Monthly Rental, other sums payable hereunder which are designated "rental" or "additional rental" and any other sums payable hereunder on a regular basis such as reimbursement for real estate taxes. Such efforts as Landlord may make to mitigate the damages caused by Tenant's breach of this Lease shall not constitute a waiver of Landlord's right to recover damages against Tenant hereunder, nor shall anything herein contained affect Landlord's right to indemnification against Tenant for any liability arising prior to the termination of this Lease for personal injuries or property damage, and Tenant hereby agrees to indemnify and hold Landlord harmless from any such injuries and damages, including all attorneys' fees and costs incurred by Landlord in defending any action brought against Landlord for any recovery thereof, and in enforcing the terms and provisions of this indemnification against Tenant. 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. 4841014 84-MI13" W2.3 o"eiwW _g_ 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 Default. Landlord shall not be in default unless Landlord fails to perform obligations required of Landlord within a reasonable time, but in no event later than thirty (30) days after written notice by Tenant to Landlord and to the holder of any first mortgage or deed of trust covering the Premises whose name and address shall have theretofore been furnished to Tenant in writing, specifying wherein Landlord has failed to perform such obligation; provided, however, that if the nature of Landlord's obligation is such that more than thirty (30) days are required for performance then Landlord shall not be deemed in default if Landlord commences performance within a (30) day period and thereafter diligently prosecutes the same to completion. In no event shall Tenant have the right to terminate this Lease as a result of Landlord's default and Tenant's remedies shall be limited to damages and/or an injunction. 11. CONDEMNATION. In the event a condemnation or a transfer 'in lieu thereof results in a taking of any portion of the Premises, Landlord may, or in the event a condemnation or a transfer in lieu thereof results in a taking of twenty-five percent (25%-) or more of the Premises, Tenant may, upon written notice given within thirty (30) days after such taking or transfer in lieu thereof, terminate this Lease. Tenant shall not be entitled to share in any portion of the award and Tenant hereby expressly waives any right or claim to any part thereof. Tenant shall, however, have the right to claim and recover, only from the condemning authority (but not from Landlord) , any amounts necessary to reimburse Tenant for the cost of removing stock and fixtures. If this Lease is not terminated as above provided, Landlord shall use a portion of the condemnation award to restore the Premises. 12. MISCELLANEOUS. 12 .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. Such Modifications may include, without limitation, the right to construct new buildings on the Property for additional uses, to remove, renovate, repair, add to, modernize or otherwise alter the building in which the Premises are situated as well as other buildings, facilities, structures, malls, walkways, landscaping, parking and common areas or other areas within 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. 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, nor entitle Tenant to damages, injunctive relief or other equitable relief, nor entitle Tenant to any abatement or reduction in the Monthly Rental, additional rental or other charges or sums due under this Lease; provided Landlord uses reasonable efforts to mitigate any adverse effects on Tenant caused by the Modifications. 12.2 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 or for the purpose of maintaining the Premises as required by the terms of this Lease or for the purpose of posting notices of nonliability 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 and without any liability to Tenant for any loss of occupation or quiet enjoyment of the Premises thereby occasioned. Tenant shall permit Landlord, at any time within six (6) months prior to the expiration of this Lease, to place upon the Premises any usual or ordinary "For Lease" signs, and during such six (6) month period Landlord or his agents may, during normal business hours, enter upon said Premises and exhibit same to prospective tenants. 12.3 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 'ICII addressed to any existing or proposed mortgagee or proposed purchaser, and to the Landlord. Tenant shall be liable for any loss 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. 12 .4 Jurisdiction and Venue. 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 497I01MI94 W)II30MM 3 .06/11/W _1 0 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. 12.5 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. 12.6 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. 12 .7 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. 12.8 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. 12.9 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 venturer with Tenant, and that the provisions of this Lease and the agreements relating to rent payable hereunder are included solely for the purpose of providing a method whereby rental payments are to be measured and ascertained. 12 .10 Nondiscrimination. Tenant herein covenants by and for itself, its heirs, executors, administrators and assigns and all persons claiming under or through it, and this Lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any person or group of persons on account of race, sex, marital status, color, creed, national origin or ancestry, in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the Premises herein leased, nor shall the Tenant itself, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the Premises. 12.11 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 1.8. 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. 12 .12 Waiver. No delay or omission in the exercise of any right or remedy by a nondefaulting 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. [THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.] 118710I 1(194 W I I3066M 3 .06/111W • 12 .13 Exhibits and Addenda. The Exhibits and Addenda attached to this Lease are made a part hereof as if fully set forth herein. In the event of a conflict between the terms and provisions of an Addenda and the terms and provisions of this Lease, the terms and provisions of the Addenda shall prevail. 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. ATTEST: CITY,OF^PALM SPRI a mu i ipal corporati n By: f City/Clerk CityMa ger "LANDLORD" APPROVED AS TO FORM RUTAN & TUCKER By: David J. A eshire, Esq. City AL�Uor ey PALM CANYON THEATRE, INC. , anon-profit corporation By: *rfltle�5 7 By: "TENANT" 49710 NIN44I I/3066W2.3 u06111M -12- 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 southern most half of 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 890 42' West on said South line, 297.40 feet; thence North on the East line of a public highway 550.4 feet; thence North 890 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 00 2' 3011 East and parallel with said East line, 550.4 feet to the point of beginning. Y EXHIBIT "A" TO LEASE 487/01MS44 113066W2.3 "061111W ]EXHIBIT "B" PLOT PLAN OF THE PROPERTY SHOWING THE LOCATION OF THE DEMISED PREMISES C LA.53- 'kOOM A ILCAO [ v U G O < < U u r r q I CLA SS•R OOI� 7UOIEI.S'Ran ' IUrcued PSI.6f LI A !FM.AY A KC NO I 538 NORTH PALM CANYON DRIVE ® Palm Canyon Theatre Exclusive Use Floor Area: 5,200 square Meet at $0.12 per square foot per month equals $624.00 per month rent. Palm Canyon Theatre Shared Use Floor Area: 2,850 square lfeet at $0.06 per square foot per month equals $171.00 per month rent. TOTAL RENT E9UALS $795.00 PER MONTH EXHIBIT"B' TO LEASE EXHIBIT "C" ESTOPPEL CERTIFICATE Tenant: THE PALM CANYON THEATRE, INC. Landlord: CITY OF PALM SPRINGS, a municipal corporation Date of Lease: May 1, 1997 Area: Frances Stevens Park Premises: 538 North Palm Canyon Drive To: 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 May 1, 1997, and, including any presently exercised option or renewal term, will expire on March 31, 2002. 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. All improvements to be constructed on the Premises by Landlord have been completed and accepted by Tenant and any tenant construction allowances have been paid in full. 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 Monthly Rent in installments of $795.00 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 $2,500.00 which was paid pursuant to the Lease. 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, 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 19 t By:.. Its: EXHIBIT "C" TO LEASE 48]1014084-0 1/3066W2.3 u06111/W 0 EXHIBIT I'D" RULES AND REGULATIONS 1. All loading and unloading of goods shall be done only at the times, in the areas and through the entrances reasonably designated for such purposes by Landlord. 2 . The delivery or shipping of merchandise, supplies and fixtures to and from the Premises shall be subject to such rules and regulations as in the reasonable judgment of Landlord are necessary for the proper operation of the Premises or of the Property generally. 3 . All of Tenant's refuse and rubbish shall be removed to central trash bins located in the Property, at Tenant's sole cost and expense. 4 . 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. S. 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. 6. 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. 7. Tenant shall not burn any trash or garbage of any kind in or about the Premises or the Property generally. 8. Tenant will not allow animals, except seeing-eye dogs, in, about or upon the Premises except those animals used in theatre productions. 9 . Tenant shall not use, and shall not allow anyone else to use, the Premises as an overnight habitation. Such prohibition shall not prohibit bathing, showering, sleeping or eating on a temporary basis. Showers and cots are provided for equity actors in the dressing rooms of the Premises. 10. 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. 11. Tenant shall keep all window displays in a clean and orderly fashion. If merchandise is to be shown in the window displays, such merchandise shall be changed at least every other month. Landlord shall have the right to require the removal or change of any window display it finds, in its sole and absolute judgment, unattractive or objectionable. _EXHIBIT I'D" TO LEASE 4871U 14084-0 1M66972.3 a06/I 1/97 • EXHIBIT "El' TENANT'S CONSTRUCTION OBLIGATIONS Within ten (10) days after the execution of this Lease, Tenant shall commence construction of improvements consisting of the following: 1) Water blasting, surface preparation and painting of all exterior walls, doors and trim of the Premises; 2) Building maintenance upgrades as identified in the "Maintenance Review of Frances Stevens School, " dated February 15, 1996, prepared by City staff, which is incorporated herein; 3) All HVAC (heating, air conditioning and ventilation) systems upgrades and improvements as required by the Tenant to operate an indoor professional theatre venue, complete with ancillary uses as identified on the ATTACHED BUILDING MASTER PLAN as submitted by the Tenant and incorporated in this Lease; 4) Within the "Auditorium" space of the Premises, construct an indoor fixed-seat theatre and stage suitable for professional live productions, creating a capacity for approximately 250 seats, on a stepped floor. Such improvements shall be cross-braced according to current seismic design code requirements and incorporating handicapped accessibility design standards consistent with the °CalACS Accessibility Standards Interpretative Manual" ; 5) Improvements in two (2) public restrooms within the Premises to current and applicable handicapped accessibility standards of the IICalACS Accessibility Standards Interpretative Manual. " The improvements shall be constructed in accordance with plans and specifications prepared by an architect or engineer licensed to practice in the State of California that are in sufficient detail to enable potential contractors and subcontractors to make reasonably accurate bid estimates and to enable Landlord to make an informed judgment about the design and quality of construction. Said plans and specifications shall be subject to the prior written approval of Landlord. Tenant also shall furnish Landlord with a true and correct copy of Tenant's contract with any general contractor. _ Tenant shall provide Landlord with ten (10) days advance written notice of Tenant' s intent to commence construction of the improvements so that Landlord may post appropriate notices of nonresponsibility. Tenant shall not commence construction until Tenant has procured all necessary permits and approvals required by all federal, state and local governmental authorities with jurisdiction. In consideration of this Lease, the City agrees to waive its fees in connection with the issuance of building permits for the above improvements; provided, however, the estimated maximum value of fees to be waived is Three Thousand Dollars ($3,000.00) . All improvements shall be constructed within the boundaries of the Premises, shall be constructed in a good and workmanlike manner, shall substantially comply with the approved plans and specifications for the improvements and shall comply with all applicable governmental permits, laws, ordinances and regulations. Tenant shall diligently prosecute the construction of the improvements to completion. The improvements shall be completed not later than October 15, 1997. Upon substantial completion of the improvements, Tenant shall file or cause to be filed appropriate notices of completion in the Riverside County Recorder's Office. Tenant shall immediately notify Landlord upon completion of the improvements and the City's Building and Safety Department shall perform an inspection of the improvements within five (5) days of such notification. City shall issue a Certificate of Occupancy for the Premises upon approval of the work. Tenant shall pay or cause to be paid the total cost and expense of all works of improvement constructed upon the Premises by Tenant. Tenant shall not suffer or permit to be enforced against the Premises or any part of it any mechanic's, materialman's, contractor's, subcontractor's or design professional's liens arising from any work of improvement, however it may arise. However, Tenant may in good faith and at Tenant's expense contest the validity of any such asserted lien, claim or demand provided Tenant has furnished a bond required pursuant to the California Civil Code to free the Premises from the effect of such lien. Tenant hereby agrees to indemnify, protect, defend and hold Landlord harmless from any loss, expense (including reasonable attorneys' fees) or liability arising out of the work of improvement. If Tenant fails to discharge such lien, Landlord shall have the right, but not the obligation, to pay or otherwise discharge such lien. Tenant shall reimburse Landlord for all sums expended by Landlord therefor, plus interest at the rate of ten percent (10&) per annum from the date expended by Landlord until fully repaid. Any such amounts expended by Landlord plus interest shall be deemed to be additional rental. All of the above improvements to the Premises, including related fixtures and equipment, are to remain the property of the City in the event that (i) Tenant defaults under this Lease and/or (ii) upon expiration of the Lease. All improvements and alterations to the Premises shall be deemed fixtures and automatically become the Property of Landlord. EXHIBIT "E" TO LEASE 487I014084-000113066972.3 a06/H/97 EXHIBIT "F" 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 six (6) professional quality indoor theatre productions on the Premises per season during the months of October through May with a minimum of five (5) performances per week for four (4) weeks each month, except during the Palm Springs International Film Festival. Tenant agrees to provide up to fourteen (14) calendar days of shared use of the theatre space within the Premises to the Palm Springs International Film Festival during such event. No rental fee is to charged by the Tenant to the festival for this use except for the reimbursement of the pro rata share of the Tenant's utility and building maintenance direct costs actually incurred during the Film Festival time frame. At the outset of the Lease term, the Tenant will submit a detailed Five- Year Business Plan for review and approval by the City's Downtown Development Director prior to being issued a Certificate of Occupancy. Also, prior to each season of theatre operation, the Tenant will submit an annual marketing and operations plan for review and approval by the Downtown Development Director. This plan is to be submitted no later that September 1 of each calendar year of the Lease, prior to the upcoming season to begin in the subsequent September and extending to the following May. Tenant will reinvest all "net annual income" generated form 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, 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; and a lecture series by writers. 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. Further, the Tenant agrees to coordinate with the Inland Empire Renaissance Festival and the Holiday Season Festival of Lights by scheduling and producing themed performances in the theatre venue which help strengthen the overall family entertainment value during these events. 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. EXHIBIT 'IF" TO LEASE 46/10M4-0 1M66W2.3 a06111M CALIFORNIA SECRETARY OF STATE BUSINESS FOGRAMS DIVISION = DOCUMENT FILING SUPPORT UNIT 1500- 11th Street Sacramento, California 95814 (916) 657-5448 �IIFO PP`' April 24, 1997 Joseph W. Layne 73-441 Broken Arrow Trail Pa17i Desert, CA 92260 RE: PALM CANYON THEATRE (4 The proposed Articles of Incorporation or Statement and Designation by Foreign Corporation form have been approved for filing. The documents (and fees, if submitted) have been placed in a pending file for a period of 60 days. The application for exemption from tax, together with the attachments thereto, have been sent to the Franchise Tax Board for processing. ( ) The proposed Articles of Incorporation or Statement and Designation by Foreign Corporation form, have been approved for filing by the Secretary of State and a copy has been sent to the Franchise Tax Board. The documents (and fees, if submitted) have been placed in a pending file for a period of 60 days awaiting the granting of the required exemption letter. ( ) The required Secretary of State filing fee for this document is $30.00. Please remit the BALANCE DUE OF Sections 23153 and 23221, Revenue and Taxation Code, prohibit the filing of Articles of Incorporation or the Statement and Designation by Foreign Corporation form, until the exemption from payment of franchise tax has been granted, or the minimum franchise tax is paid. The Franchise Tax Board will send a letter granting exemption from franchise tax, an inquiry requesting additional information, or a rejection of the application to the address indicated on the application. If exemption is granted, a copy of the letter will be sent to the Secretary of State for use in filing the pending documents. ALL INQUIRIES REGARDING THE ISSUANCE OF THE TAX EXEMPTION MUST BE DIRECTED TO THE FRANCHISE TAX BOARD, SACRAMENTO, CA, ATTENTION: EXEMPT SECTION. DOCUMENT FILING SUPPORT UNIT BUSINESS FILING ilg DOCS.N-P (f-97J Palm Canyon Theatre, Inc. Guaranty of Lease William J. Layne 6-23-97 GUARANTY OF LEASE — - THIS GUARANTY OF LEASE is executed as of 1997, by WILLIAM J. LAYNE ("Guarantor") in favor of the CI OF PALMS RIN s, a municipal corporation ("Landlord") , with reference to the following facts: A. Landlord and THE PALM CANYON THEA E, INC. , as tenant ("Tenant") , are about to execute that certain Lease dated , 1997 (the "Lease") covering certain premises in the City of a m Springs, commonly known as 538 North Palm Canyon Drive (the "Premises") B. Landlord has required as a condition precedent to the execution of the Lease that Guarantor execute and deliver to Landlord this Guaranty of Lease. NOW, THEREFORE, in consideration of the execution of the Lease by Landlord and as a material inducement to Landlord to execute the Lease, Guarantor hereby agrees as follows: 1. Guarantor hereby unconditionally guarantees to Landlord and its successors and assigns, without deduction by reason of setoff, defense or counterclaim, (1) the timely payment of all amounts that Tenant may owe under the Lease during the first year of the term, (ii) further guarantees to Landlord the full, faithful and timely performance by Tenant of all of the covenants, terms and conditions of the Lease during the first year of the term, and (iii) timely completion of all of Tenant's construction obligations under the Lease, (collectively, "Tenant's Obligations") . Guarantor shall be liable for a maximum amount of One Hundred Thousand Dollars ($100, 000) under this Guaranty for defaults of Tenant's Obligations. If Tenant shall fail at any time to pay any rent or any other sums, costs or charges whatsoever, or to perform any of the other covenants and obligations of Tenant under the Lease, then Guarantor, at Guarantor' s expense, shall on demand by Landlord fully and promptly pay all rent, sums, costs and charges to be paid and perform all other covenants and obligations to be performed by Tenant under or pursuant to the Lease, and in addition shall on demand by Landlord pay to Landlord any and all sums due to Landlord, including, without limitation, all interest on past due obligations of Tenant, costs advanced by Landlord, damages and all expenses (including, without limitation, court costs and reasonable attorneys' fees) incurred by Landlord that may arise in consequence of Tenant's default under the Lease and in seeking to enforce this Guaranty of Lease. 2. The obligations of Guarantor hereunder are independent of the obligations of Tenant. A separate action or actions may, at Landlord's option, be brought and prosecuted against Guarantor individually, whether or not any action is first or subsequently brought against Tenant, or whether or not Tenant is joined in any such action, and Guarantor may be joined in any action or proceeding commenced by Landlord against Tenant arising out of, in connection with or based on the Lease. Guarantor hereby waives all right to assert or plead at any time any statute of limitations as relating to the Lease, the obligations of Guarantor hereunder and any and all surety or other defenses in the nature thereof. In addition, Guarantor hereby waives any rights to (a) require Landlord to proceed against Tenant or any other person or entity or pursue any other remedy in Landlord's power whatsoever; (b) complain of delay in the enforcement of Landlord's rights under the Lease or under this Guaranty; and (c) require Landlord to proceed against or exhaust any security held from Tenant or Guarantor. Guarantor waives any defense arising by reason of any disability or other defense of Tenant or by reason of the cessation from any cause whatsoever of the liability of Tenant. Guarantor waives all demand upon the notices to Tenant and to Guarantor, including, without limitation, demands for payment or performance, and notices of nonperformance or nonpayment. 3. Any act of Landlord, or its successors or assigns, consisting of a waiver of any of the terms or conditions of the Lease, or the giving of any consent to any matter or thing relating to the Lease, or the granting of any indulgences or extensions of time to Tenant, may be done without notice to Guarantor and without releasing Guarantor from any of Guarantor's obligations hereunder. 4. Guarantor's liability hereunder shall in no way be affected by (a) the release or discharge of Tenant in any creditors' receivership, bankruptcy or other proceeding; (b) the impairment, limitation or modification of the liability of Tenant or the estate of Tenant in bankruptcy, or of any remedy for the enforcement of Tenant's liability under the Lease resulting from the operation of any present or future provision of the Bankruptcy Code or any successor statute or any other statute or from the decision of any court; (c) Landlord's receipt, application or release of any security given for Tenant's performance and observance of Tenant's Obligations; (d) the rejection or disaffirmance of the Lease in any such proceedings; (e) the assignment or transfer of the Lease or subletting of the Premises by Tenant; (f) the assignment or transfer of the Lease or this Guaranty of Lease by Landlord; (g) the exercise by Landlord of any of its rights or remedies reserved under the Lease or by law; or (h) any termination of the Lease. 5. Until all of Tenant's Obligations are fully performed and observed, Guarantor (a) shall have no right of subrogation against Tenant by reason of any 487/014084-0001/3074894.3 a06/11/97 N 46 payments or acts of performance by Guarantor hereunder, and (b) subordinate any liability or indebtedness of Tenant now or hereafter held by Guarantor to the obligations of Tenant to Landlord under the Lease. 6. This instrument constitutes the entire agreement between Landlord and Guarantor with respect to the subject matter hereof. 7. This Guaranty shall be governed by and construed in accordance with the laws of the State of California. s. Should Landlord desire to give any notice to Guarantor, such notice shall be in writing and may be given by personal service or by certified or registered mail, postage prepaid, return receipt requested, to Guarantor at the address indicated below. Guarantor may by written notice given in the manner described in the preceding sentence designate a different address for notice purposes. Any notice sent by mail shall be deemed delivered within seventy-two (72) hours after mailing. 9. Any action to declare or enforce any rights or obligations under this Guaranty may be commenced by Landlord in the appropriate federal or state court of California. Guarantor hereby consents to the jurisdiction of such court for such purposes and agrees that any notice, complaint or other legal process therein may be delivered to Guarantor in accordance with the above notice provisions and that any notice, complaint or other legal process so delivered shall constitute adequate notice and service of process for all purposes and shall subject Guarantor to the jurisdiction of such court for purposes of adjudicating any matter related to this Guaranty. IN WITNESS WHEREOF, Guarantor has executed this Guaranty of Lease as of the date first written above. ti WILLIAM LAYNE Address: &=0;7__44,�,y�rf/}� -2- 487/014084-0001/30748943 a06/11/97 AI/II I{II® DATE(MM/DDNY) CERTIFICAITOF LIABILITY 1NSURA E 05/15/97 PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HRH Ins Sery of Coachella Vly HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR License Number 0684603 ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. 77.564 Country Club Dr. *150 ?� `� COMPANIES AFFORDING COVERAGE Palm Desert CA 92211 J I COMPANY A NIAC INSURED COMPANY I Palm Canyon Theatre B O n—Q)C' �� .�t�,S u.n..e-v-� ! �r AN C J 538 N. Palm Canyon Drive COMPANY Palm Springs CA 92262 ° `� .�+-(•�-��In;�- 3� - L1?O COMPANY D COVERAGES .f .. TO C THE ICI .O .. .. . . .:.. NAME. THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS, POLICY EFFECTIVE POLICY EXPIRATION Go n TYPE OF INSURANCE POLICY NUMBER LIMITS LTR DATE (MM/DDYY) DATE (MMIDDAY) A GENERAL LIABILITY PENDING 05/14/97 05/14/98 GENERAL AGGREGATE $ 1,000,000 X COMMERCIAL GENERAL LIABILITY PRODUCTS COMPIOP AGG $ 1,000,000 CLAIMS MADE F OCCUR PERSONAL&ADV INJURY $ 1,000,000 OWNER'S&CONTRACTOR'S PROT EACH OCCURRENCE $ 1,000,000 FIRE DAMAGE(Any one ire) $ 50,000 MED EXP(Any one person) $ 5,000 AUTOMOBILE LIABILITY COMBINED SINGLE LIMIT $ ANY AUTO ALL OWNED AUTOS BODILY INJURY $ SCHEDULED AUTOS (Per person) HIRED AUTOS BODILY INJURY S NON OWNEDAUTOS (Per acc dent) PROPERTY DAMAGE $ GARAGE LIABILITY AUTO ONLY EA ACCIDENT $ ANY AUTO OTHER THAN AUTO ONLY EXCESS LIABILITY EACH OCCURRENCE $ UMBRELLA FORM AGGREGATE $ OTHER THAN UMBRELLA FORM $ _ WORKERS COMPENSATION AND -- - -___-- — C-5Tei — --or = __ EMPLOYERS LIABILITY TORY LIMITS ER EL EACH ACCIDENT $ THE PROPRIETORI INCL EL DISEASE-POLICY LIMIT $ PARTNERS/EXECUTIVE OFFICERS ARE EXCL EL DISEASE-EA EMPLOYEE $ OTHER DESCRIPTION OF OPERATIONSiOCATIONSNEHICLESISPECIAL ITEMS Certificate Holder is named as Manager/Lessor of Premises CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE The City of Palm Springs EXPIRATION DATE THEREOF,THE ISSUING COMPANY WILL ENDEAVOR TO MAIL Attn: Judy Sumich 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT, P,O. Box 2743 BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR LIABILITY Palm Springs CA 92263 OF ANY KIND UPON THE COMPANY,ITS AGENTS OR REPRESENTATIVES AUTHORIZED REPRESENTATIVE ACORD 25-S (1l95) Tina Matuska . ... �CSE#0 84503. ° ACOR ON 1988 acoko. CERTIFICPW OF LIABILITY INSUONCkD LK DATE(MM/DD/YY) RBR-1 06/13/00 PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION Austin Cooper & Price ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE Ins Agency Inc (Lic-0546677) HOLDER.THIS CERTIFICATE DOES NOT AMEND,EXTEND OR P O Box 3280 ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. San Bernardino CA 92413-3280 Phone: 909-886-9861 Fax:909-886-2013 INSURERS AFFORDING COVERAGE INSURED NSURERA Royal Surplus Lines Ins Co/B&R INSURER B. Federal Ins Company/Chubb Bar Bro Inc INSURER C: American Motorist Ins Co/Kempe 2750 Siggal Parkway INSURER D. State Compensation Ins Fund Signal Hill CA 908D6 INSURER E: COVERAGES THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED NOTWITHSTANDING ANY REQUIREMENT,TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN,THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS,EXCLUSIONS AND CONDITIONS OF SUCH POLICIES.AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR TYPE OF INSURANCE POLICY NUMBER POLICY EFFECTIVE POLICY EXPIRATION LTR DATE MMIFECTI DATE MXPIRA I LIMITS GENERAL LIABILITY EACH OCCURRENCE $ 1,000,000 A X COMMERCIAL GENERAL LIABILITY KZB511722 07/01/99 07/01/00 FIRE DAMAGE(Anyone fr.) $ 50,000 CLAIMS MADE [X] OCCUR MED EXP(Any one person) S 5,000 X Owner/Cunt Prot. PERSONAL&ADV INJURY S1,000,000 GENERAL AGGREGATE $2,000,000 GEHL AGGREGATE LIMIT APPLIES PER: PRODUCTS-COMP/OP AGG $ 1,000,000 POLICY PRO LOD ECT El AUTOMOBILE LIABILITY COMBINED SINGLE LIMIT S1,000,000 C X ANY AUTO TKP73042601 07/01/99 07/01/00 (Ea acodan) ALL OWNED AUTOS BODILY INJURY SCHEDULED AUTOS `�}� �IiJ's (Per person) $ X HIREDAUTOS ��` '� A BODILY eracci ent) $ X NON-OWNED AUTOS �) LBtrj�l (Per ecmtlent) PROPERTY DAMAGE $ GARAGE LIABILITY - EV AUTO ONLY-EA ACCIDENT $ ANY AUTO f� OTHER THAN EA ACC S AUTO ONLY. AGG $ EXCESS LIABILITY EACH OCCURRENCE $ 10,000,000 B OCCUR CLAIMS MADE 79770787 07/01/99 07/01/00 AGGREGATE S 3.0,000,000 S DEDUCTIBLE RETENTION $ $ WORKERS COMPENSATION AND __ WC STATU ER EMPLOYERS'LIABILITY- - -- _ --—-' - - — ------- -- - - ---- - - D 46859200 01/01/00 01/01/01 EL EACHACCIDENT $ 1000000 - E.L DISEASE-EA EMPLOYEE $ 1000000 E.L.DISEASE-POLICY LIMIT $ 1000000 OTHER C Equipment TKP730426001 07/01/99 07/01/00 Equipment $150,000. Ded $1,000. DESCRIPTION OF OPERATIONSILOCATIONSIVEHICLES/EXCLUSIONS ADDED BY ENDORSEMENTISPECIAL PROVISIONS RE: Palm Canyon Theatre-538 Palm Canyon Drive, Palm springs CA Certholder is add'1 ins as respects gen'l liab per CG2010 1093and Add-1 ins as respects workers compensation from 06/14/00 thru 06/23/00. Workers Comp add'1 insured end't will be issued direct from State Compensation Fund Ins 30 days N 0 C except 10 days nonpayment CERTIFICATE HOLDER }[ I ADDITIONAL INSURED;INSURER LETTER:_ CANCELLATION CI PAL01 SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATETHEREOF,THE ISSUING INSURERWILL EMAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT City of Palm Springs 3200 East Taquitz Canyon Way Palm Springs CA 92262 ��---- ACORD 25-S(7197) / ©ACORD CORPORATION 1988