Loading...
The URL can be used to link to this page
Your browser does not support the video tag.
Home
My WebLink
About
Robert L. Mayer - 1993-06-14 (17)
MI , 1 , sees� Page ARTICLE XIV. CASUALTY LOSS AIM. RESTORATION 14 . 1 None-Termina*:aon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 14 . 2 Repair of Damages . . . . . . . . . . . . . . . lose . . . . . . . . . . . 65 14. 3 Continued Operations . . . . . . . . . . . . . . . . . . . . . . . . . . 66 14. 4 Deferral of Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67 14 , 5 Damage or Destruction in Last Years . . . . . . . . . . . 68 14 . 6 Limitation on Lessee: ' a Obligation to Restore and Right to Terminate Le:aae . . . . . . . . . . . . . . . . 69 ARTICLE XV. EMINENT DOMAIN 15 . 2 Condemnation of Premises . . . . . . . . . . . . . . . . . . . . . . 70 ? 15 .2 Partial Condemnation . . . . . . . . . . . . . . . . . . . . . . . . . . 70 i 15 .3 Laneor ' s and Lessee ' s Damages . . . . . . . . . . . . . . . . . 73 ARTICLE XVI . ASSIGNMENT AND SUBLETTING - 1 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 26.2 Bankruptcy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 26.3 Lessor ' s Zee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 26.4 No Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 ARTICLE XVII . LEASEHOLD FINANCING: RIGHTS OF LEASEHOLD LENDER ..a 17. 1 M o r t gage�yof Lease . . . . . . . . . . . .• . . . . . . . . . . . . . . . . . 8{2 ' 17. 2 Dofiniti/M roe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v/3 17. 3 'Rights ofLender 83 17. 4 Connent of Lessor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88 } ARTICLE XVIII . DEFAULT Ewa 18. 1 Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89 26.2 ... Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . cd .. Ia. 3 Default by Lessor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95 18.4 Legal Enpenshs and CoLlection Costs . . . . . . . . . . . 95 ARTICLE XXX. HOLDING OVER ! 19. 1 Holding Over . . . . . . . . . . . . . . . . . . . . . . . . . , . . . . . . . . 96 i tied ART I CLIP XX. (RE SERVED) i f i Faao ARTICLE XXZ , ( RESERVED) i ARTICLE XXII . ACCESS BY LANDLORD 22 . 2 Right of Entry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ARTICLE XXIII . FURNITURE:, FIXTURE AND EQUIPMENT FINANCING 23. 1 FF&E Financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99 ARTICLE XXIV. TRANSFER OF LESSOR ' S INTEREST 24. 1 Transfer of Lessc•r' s Interest . . . . . . . . . . . . . . . . . 10: ARTICLE XXV. FORCE MAJEUftE �..I 25 . 1 Force Majeure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102 i ARTICLE XXVI . MISCELLANEOUS 26 . 2 Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . ... . . . . . . . . . . . 302 26. 2 Notices � 103 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . } 26. 3 Relationship of Parties 103 r 26.4 Broker' s Commission 104 26. 5 Accord and Satisfaction 104 26. 6 Time of Essence 205 26. 7 Remedies Cumulative 105 26. 8 Construction, . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105 26. 9 Effect of Invalidity . . . . . . . . . . . . . . . . . . . . . . . . . . 105 26. 10 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . 206 26. 11 Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106 ;.., 26. 12 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106 2.6. 13 Peerfcrmanco of Lessee' s Obligations . . . . . . . . . . . 107 �.J 26 . 14 Quitclaim Deed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107 26. 15 N=bar and Gander . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107 26 . 16 Interest on Past-Due Obligationn . . . . . . . . . . . . . . 108 ,► 26. 17 Execution of Leaser; No Option . . . . . . . . . . . . . . . . . 108 26 . 26 Corporate Authority 108 26.19 Reserved lag 26.2�i Controlling Law . . . . . . . . . . . . . . . . . . . . . „ . . . . . . . . . 109 26.21 Spert:ific Performance . . . . . . . . . . . . . . . . . . . . . . . . . . 209 28 22 Survival of Indemnities and Warranties . . . . . . . . 209 i26:23 Honoirandum of Lease . . . . . . . • . . . • . . . . . . . . . . . . . . . 210 i 1 ' 1 1 � •ter Page ARTICLE MVII . ARBITRATION 27 . 1 Comm-uncament . . . . . . . . . . . . . . : . . . . . . . . . . . . . . . . . . . 110 27 . 2 Procedure . . . . . . . . . . . . . . . . . . 112 27 . 3 ;qualifications . . . . . . . . . . . . . .• . . . . . . . . . . . . . . . . . . 113 i7 . 4 $indA nq Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213 27 . 5 Expert Testimony 113 27 . 6 Lercinion Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.'.4 27 . 7 Enfor:etneent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114 ARTICLE XXVIII . REPRESEItiTATIONS BY LESSEE 26 . 2 Rw;resentftt1Tana by Lessees . . . . . . . . . . . . . . . . . . . . . 115 �.1 11 1 1 13 16 • ♦ i �- rV • M r Revisions to bb Made to Lease at Time of Disposition w EXHIBIT C Legal Description of • • }• I r u Y a r 4� r - - O► ti t• l A Of 1• AWTA • r r •1'1 no ' CECOND AMENDED AND RESTATED LEASE THxS SECOND AMENDED AND RESTATED LEASE ( the "Lease" ) is ex-ecut:ed at of the 15th Flax of August;, 1988 (;:tle 'Effective Date" ) , by and between THE CITY GF HUNTINSTON PEACH, a municipal corporation ( "Lessor" ) , and R.OBERT L. MAYER, xe Truttee of the Robert L . Mayer Trust of 1982 , dated June 22 , 1982, as amended ( "Lessee" ) (collectively, the "Parties" ) , with reference to the following: A. Lessor owns that certain real property located gens;:atlly on the north side of Pacific Coast Highw4y, between Huntington Street and Beach Boulevard, in the City of Luntington Beach, County of Orange , State of California; and more particularly described on Exhibit "A" attached hereto and by this reference made a part hereof ;the "Premises" ) . B. The Premises have prcvioualy been leased by Lessor pursuant to the fal'.owing described instrum,%nts : 2 . Leese dated March 28, 1960, as recorded in the Officia,7, Records of Orange County on January 9, 1961 , in Book �0382 at Page 203 s 2 . option dated January 2, 1962, as recorded in the Official Records of Orange County on January 17, 1962 , in Book 59178 at, ?age 905; i %TTA UT i 1 r' 3 . Amendment to Lease dated January 3 , 1962 , as recorded in the Official Records of Orange County on innusry 17, 1962 , in Book 5978 at Page 910; 4. Amendment to Lease dated January 22, 1963 , as recorded in the Official. Records of Orange County on February 1, 19631 in Book 6416 at Pago 719 ; i ��. Lease dated February 7 , 1967, as recorded in the Official Records of Orange County on February 10, 1967 , in Book 81.74 at Page 346; and S. emended and gestated Lease dated November 29, 1983, as referenced . , the Memorandum( s) of Lease recorded in the Official Records of Crange County oO. December 24, 1983 as instrument no. 83-567981 and 63-567982 and on December 19, 1983 as I.r.strument no. 83-574611. C. Lessee now holds all of the Lessee ' s Interest in the Promises under the Amended and Restated Lease referenced in Paragraph B. 6 above . ..). Lessor and Lessee now desire to restate `,;her Lease and Y amend It In certain reepects , ..i �'!"�'8►�lO�i� 8�� i i 06SSh/2460/12 -Z- f a� �MNh,Y4?wy �j;'r5: inn . I t ;n consideration of the payments to be made hereunder and the cotlenants and agreements contained herein, Lessor hereby agrees to lease to Leassoe: and Lessee hereby agrees to lease from Lessor the real property hereinafter de:-fined as the Premises upon the following terms and conditions : ti ARTICLE I . PREMISES AND TERM 1 . 1 Premises . Lessor hereby leases the Premises to Lessen, and Lessee hereby hires the Fremisas from Lessor. Any and all buildings, structures and fixtures (other than trade fixtures, as defined in this Le�aae) attached to :the Premisms, and any utilitica and related improvements (other than dedicated public improvements ) made to the Pramises, and any and all s',.terations, additions, and improvements thereto shall be deemed to i)e real property and shall hereafter be referred .,i to an the "Improvements" . 2 .2 Reservation. Lessor reserves to itself , its successors and assigns, together with the right to grant and transfer all or a porti n of the same, the following: ..J ( a) The non-exclusive right to enter upon the i Premises in accardanca with any rights of Lessor set; ::orth in this Loaso; i no i 0635n/2460/11 403- 1 , ' 1 1 F 1 1 1 (b) .%ny and all oil , oil rights, petroleum, i minerals, mireral rights, natural gas rights , and other 1. hydrocarbon substances by vhatsoeve: name known, geothermal i resources ( as defined in California Public• Resources Cede, i Section 6903 ) , and all products derived from any of the { fore:going, that nay be wi than or %ender the land, together with the perpetual right. of drilling, mtninq, exploring, proapecting and operating therefor and sic,ring in and removing the same from the Premises or any other land, including the right to 1 whipstock or directionally drill and mine from lands other than those conveyed hereby, oil or gas wells, tunnels and. shafts into, through or across the subsurface of the Preminee, and to bottom such whipstocked or directionally drilled wells, tunnels and shafts under and beneath or beyond the exterior limits thereof, and to redrill, retitnnal, equip, maintain, repair, deepen and operat6 any ouch wells or mines; without, however, the right to enter, drill , mine, store, explore or operate on or through the surface or the upper 500 feet of the subsurface of the Premises; and (C) Any and all water, hater rights or interests therein, no matter how acquired by Lesior, together with the F �+ right and power to explore, drill, reRdri33 , remove and store the same from the Premises or to divert or otherwise utilipte such grater, wxtet rights or interests on any other property evned or leised by Lessor, whether such water nights shall be riporlan, overlying, appropriative, percolating, littoral , 4 T 30. 6 0635n/2460/12 } a WORD prescriptive . adjudicated, statutory or contractual ; but - i without, however, any right to enter upon the surface of the Premisecr in the exercise of such rights xnd, provided further, that the exercise of any s"ch rights by Lessor shall not result in any damage or injury to the Improvements, including without limitation any subsidence of all or any part of the Ymprovaments , 1. 3 Exceptions tc Leazehold Estate, This Lease is made sud.jact to : ( a) General and special taxes and assess--n©nts for the current fiscal tax year and all unpaid bonds and/or assessments; provided, however, that the foregoing shall not be deemed to be a consent by Lesser tu •any bonds or assessments; and (b) All covenants, conditiuris, .restrictions, reservations, rights, rights-of-way, easements and all other matters of record or apparent upon a visual inspection of the Premises affecting the Premises or L•he use t-horeof on the _ Efr'ective Date. 1. 4 1'erm of Lease . This Lease shall covirOnce on Aiguat 15, 1988 (the "Term Commencement Dste" ) , and shall terminate ou January 31, 20230 unless sooner terminated Or extended as herein provided. For purpasea of this Lease, the _.: A2?AC ZM NO. 6 ' 0630 3n/2 460/12 w. . I ' sML r - •r I I term "Lease Year" shall mean a calendar year; except in the event when the Term commences on a cute other than January 1, the first Lease Year sh&A'.1 be the period f,t'om ouch commencement date to the next succeeding Uecember 31 and, further, if this Lease terminates on a date other than December 31, the last Lease Year ahall be the period beginning cn the January 1 following the last full. Lease Year and ending on such tornination nett . 1' 5 Termination. Alotwi..hmtanding Section 1 . 4, the Term of this Lease shall i-Apire on December :31, 2010, as t. any property covered by this Lease which has not been "conveyed", to Lessee ny Lessor on or before Decomber 31, 2004, pt:,suant to a "Dispouitlon Transfer" , as set forth in Section 301 of the "DDA" described in Section 1 . 11 below; provided, however, that in the event that any such D: spos=. tion Transfer is del.ailed past December. 31, 2004, due to a default by the Agency under the DDA or due to circumstances entitling Lessee to an extension of time under 5ect±an 7.03 of the DDA, the Term of this Lease as to the portion of such "Separat:s Development Parcel" ( as dofined in the ODA) included within the Premises that has not been so "nvay*d to Lessee shall be extended for the period of the delay (but in no avant .beyond .tanuary 31, 2f 13) . Nothing in tbis Lease is it.tended or shall be interpreted to 21-mit or affect Lessee ' • or Lessoi;' s respective tights to specific parfo;vanao under the Wil. ,r.•! .era. 6 08/01/019 063 5n/i 46 V/12 =6- r , 1 . t; 1 . 6 Possession of the Premises . Lisssor shall he doomed to have delivered possession of the Promises to :,asses at they Term _3 Commencement Date . L s sssee hereby acknowledges that it has viewed and is familiar with the condition of the Prnmi s s s and accepts the Premi s%;s in ai, "ass 's" Physical condition, i • 1 . 7 Date of Leas@ and Lecal Effect. The terms, covenants and conditions of this LeRsses shall become legally binding on the Effective Date . 1 . 8 Rent Comme ncemp.nt Date . Lessee' s obligation to ps.y kesnt ( "Rent Commencement Date"-) shell commence on the 1'e rm Commencement Date . 1 . 9 Commencement Date for All Other Oblxgationp. All other monetary obligations of "` %%ssee including, but not linited • to, the obligation to pay taxes and assessments , development fees, and any other sum of money or charges shall carnmeence, sxs of ';he Rent Contmerncement Date. X .'.'L' O Owaarsahip of Ipproyesments and furnishings, Fixtures, Equipment and _Personal Property; Lessee ' s Duty To Surrender. IDurinq the entire berm of this Lease, all Improvements and all furnishi-ngs, fixtures, equipment, and perN;onal property that are made or placed in or an the Promises by Leases!, and all chinges, alterations, improvements, and additions thereto, shall be vaned by and considered at the property of Less** and not Lessor. �� . lam No. i 08/01/86 0633n/2460J12 r-7- I 1 At the expiration or earlier termination of the Term, Lessee shall surrender to Lessor tJ.ie po asassion of the Premises, including the Improvements thereon, in good order, broom-clean, and in a clean, sanitary, and safe condition, uw giiallty, and repair, and in accordance with this Lease . At 1 � such time, a1i of the Improvements (which term is intended to exclude ME ( as dex'ined in this Lease) , personal property, and s co:7tsinin a business name trademark symbol, logo, any sign g Y� g or design.) I:hat Are made or placed in or on the Premises by Lease*, and all changes, alterations, improvcm. eats and additions thereto, shall be coneidared part of the real property of the Premises and shall remain on the Premises and become the property of .Lessor. Lessee shall be entitled to ramove any furnishings, equl.pnent and personal property owned or leased by Lessee, provided that such removal shall completed within thirty (30) obeys after the expiration or earlier termination of the Term, provided that with respect to trade fixtures, at Lessor' s election, (i ) each trade fixture which in not subject to an +encumbrance In connection W th financinq tho acquisition thereof shall become the property of Lea sor for tba purchase pria-We get forth below and shall not be removed b f Lessea, and (1 i ) each trade fixture which is subject to any encumbrances) in connection frith financing the acquisition thereof may be purchased by Lessor as provided �►'1"'L'J1�CilM'i' �D. i i� ; 1 The price, for each such trade fixture shall be Lessee ' s depreciated cost based on the estimated useful life of the :subject. fixture as determined from Lessee ' s books and calculated on a straight lime basis . The election shall be i exurvised, if at all, by notice given not more than thirty (30) , L days nor lens than one hundred twenty ( 120) days before: the ari expiration of the Term; provided that, in the want of i l! termination other than by normal expiration of the Term, the notice mall be given concurrently with or as a part of the notice of termination. At Lessor ' s elsction, Lessor may without notice offset aagainat taie purchase price any or all sums then due from Lessee to Lessor, iTpon election of Lessor to purchase any such trade fixtures as aforesaid, Lessee shall �. zunvey good and marketable title to etch such trade fixture to Lessor free and clear of all liens and encumbrances of any kind 9� whatsoever. !el For puzp!ozes of this Lease, trade fixtures shall include all machinery, partitions, furniture, furnishings, doors, bins, ricks, floor coverings, lighting fixtures, gasoline pumps, seater pumps, axterior and interior signs, and other equipment and personal property installed or placed in or on the Premises whether or not permanently attached to the real property, but shall not incjudi elevators, radiators, boilers, or air Cond4tIoninq equipment unless those 'Mesas can be removed W.thout Y tothe ur 1n� rovement& or to the Premises. lmp 08/01/88 0633v,/2960/12 -�- •I wx i Elevntorst radiators, boilers *.rid air conditioning emiipment which cannot be removed without injury to the Improvements or to the: premises stall be considered part of the Improvements for purpose-, of this Lease. Lessee shall repair any damage, to the Improvements caused by ts.e wr-'oval of any of Les-3ee' s property from the Premises as w permitted hereunder . In the: event that Le zzea elicts to terminate this Leas. as a result of casualty damage* or dent•:uction, in accordffinc& w•'th Sections 14.2 (a) and 14 . 5, h Lesser shall lsave the right, within thirty (30) days after } receipt of Laassoe: ' s Notice of termination, to xea_u.ird Lessee: to demolish the Improvements and clear them from the Premieres, and in such event she Term shall eoritinu►e until such word: is t COII.Vle wed'. Ail property that Lessee is required to surrender :d shall become Leiser' s property at termination or expiration of this Lease. All property that Lessee is not required -to , t . n,srxeandex but that Lease a does abandon shall , at Lessor' s A elerctiop, become Lessor' s property thirty (30) days after termination or expiration. ) 1. 11 The__Cit;i-Agency Agreement afiO the DDA; Madificaticn of ~ Lease at Tlma of Dispo*itio ti Transfors. Losgor and the guutincxton Hecch Redevelopment Agency (the "Agenay" ) intend to enter into a Purchaao and Sale Agr*tmont (the "City-Agnncy !� AgreeaeAt#) for the sale of the promises by Lessor to Agency. 9n Unquiet 15, 2988, the .Agency and Lessee entered into a I%VTm 1fT no* 5 Oe'01/" 0635 ►/Ma/l2 -10- .r. risposition i.in i DeveI opine n F,41•eeinf..:,1: with r--opect to " :;ite'' ctc-::,cribed t:heroin, of. which .�nz. Premizes are. a 7�. , t . The City g�ancy �1gA.evve%t wi 12 he ,end the DE i s a p�ibli%-. record on file in the office of t1w.- City Clerk of the y oL H ntincjv.nn 'Oeach, 2000 rain St.-reet, Huntington Beach, CA 926-46, and reference i made to suic:h agreements io;: further. •a particolarz. In genera]., the DDA c:ontempli.tes the sale by the I Agenc,! to Lessee of "Separate Development Parcels" ( as defined In Vie DDA) w' thin the "Residential PorLic, (as defi*+ed in the DDA ) of the "SJ to" , anti the leasing by the Ag,incy to L assee of � "Separate Development Parcels" within L.he "Commercial Portion" Y ( as defined in the DDA) of the "Site" , Buz sitant to "Disposition t Transfers" ( as defined in the BDA) which will. occur at -the timer, fo'r the consideration, an•-' based on the terms and conditio:�c. set forth in the BDA, The City-Agency Agreement contemplates the nale by Lessor to the Agency of. Lessor ' s interest ;.n such Separate Development Parcels in time for t LA Agency to convey the Rare to T,os.sete pursuant to the DD.N. At the time Agency acquires C:it:y' s interest in the Site or any Separate Development Parc;.-r thereof, Agency shall be responsible for all of Lessor' s responsibilities hereunder; as used herein, the term "Lessor" shall include any successov to I the City' s intarest in the Site or any portion thereof . At the r +i time of each "Disposition Transfer" of a "Separate Development Parcel" within the "Site" pursuant to t'he DDA., this Lease sha►1l be modified ,..a set forth in Exhibit "B" hereto. Lessor and 08/01188 If UMn/248O/I2 -il� } i Lessee eaac'Ah, agreas tr) coops rate. and execute modified lease ► cior;uwent s in acc orc?avnce with uxhibil: "II" ar: i to execute all documents rer;�ie��t:ed l;l, the o;.her tc remove any prior and conflicting lease i of recu d. it is ur,deirst:ood and agreed that except as ot:herwiye; specifically set forth in •;:his Lease , a i breach or default by either party under the DDA shall not constitute a breach or default hereunder, and that a terminatiOIL, in whole or part, of the DDA shall not termi.nato or modify Lessor' s or. Lessee ' s rights or obligations ha.-Munder, s except as may be specifically set forth in Section 1 . 5 and , Section 2 . 1. , clause (b) , and elsewhere herein. 1 . 12 Quiet Enjoyment . Subject to Sections 1 . 2 and 1 . 3 above, upon payment by Lessee of the rents provided herein, and upon the observance and performance of all of the covenants, terms and conditions on the part of Lessee to be performe3 hereunder, Lessor covenants and warraats that Lessee may peaceably and quietly hold and enjoy the Premises for the Term, without hindrance or interruption by Lessor or any person or entity claiming under or through Lessor . 1 . i 1 > f i Rx'ICLE I1 . RENT 2 . 1 InItJ-;:,J Rent . "W ( a ) Initial Rent. F roin the Rent Commenc,►ir:-int Date. untli the date set forth ir, (b) below, Lessee shall pay to lie sor an Anniial rent of Two Hura:ecl T:�ousanci Dollars ( $200, 000) per Lease Year . Rent for any Lease. Year less than a full calendar year shall be prorated by multiplying they annual rent then in effect by a fraction in which the n:imerator equals the number of days ir. such Lease Year and in which the denominator equals 365 . The rent shall be payable in quarterly �i '� P Y installments equal to one-fourth ( 1/4th) of such annual rent beginnizig on the Rent Commencement Date. Each installment y shall be payable in advance without demand upon the firs. day of the first month of eanch caleiida r ,:r•a-urter during the Term without deduction or offset in lawful money of the United States . The rent for any fractional part of a quarter w following the Rent. Commencement Date shall be prorated on a daily bAsis based can a ninety (90 ) day calendar quarter. `* (b) Adjustment of Initial Rent. Subject to Section ' 2 . 7 below, the initial rent shall be adjusted to an amount { yqual to Five hundred Thousand Dollars ( $500, 000 . 00) per Lease Year on thw earlier of the following dR L.as: r 4 0435 '/2460/l2 d-13 KT W ( i ) June :30, 1999 , ( ii ) The date: on which _Lessee do faults tinder whe DIM by fa:iliag to timely complete construction of the "Developer Improvements" ( as defined in the DDA) on any ct .p the "-se nr rate Development Parcels" which are the subject. of a "Disposition Tranzf.'er" , as provided, in the DDA ; provi.:ied, that in determining whether a de.fatllt has occurred, Lessen shall be entitled to the benefitr of. Sections 601 and 703 of the DDA; And further provided that this subparagraph M ( ii ) shall not apply to the extent that such default is �+ committed by any person or entity ogler than Lessee .A hereunder. `1 2 . 2 Rent Increases . Subject to Sectioti 2 . 7 hn.low, the rent payaLl,e u1nder this Lease ohall be a ininimum of -the rent therk <r payable pursuant to Section 2 . 1 above increased as set forth in � e this Section 2 . 2 . The annual rent required pursuant to Section, I: . 1 shall. 14 be adjusted upward as of July 1, 1994, and each January tat thereafter as provided herein (the "Adjustment Datmn" ) . The adjustment shall be calculated upon the basis, of the United States Department of Labor, Burewo of Labor Stettistics Consumer price Index of Urban wage Earners and Clerical Workers , Loa Angilsaa-Gonr� peach.-AnRheim Average.. all items (1967 : 100) ( the " Index" ) . The Index published and in effect n:s.nety (90) days -»- J' + prier to July 1 , 19S.4, shall be considered the. "Base Year Index" . At: each .AdJuTtrnurt: :)ate , the rent otherwise due shall t be adjusted by the: per.cLntage increase, if any, be':wee:n the Base Fear. Tm'. ex and they Index published and in effect ninety ( 90 ) ci;kyu preceding the Adjustment D,, In no event~ shall the rent following ari Adjustment Dais be less than the rent in effect during the Lease Yea: immediately preceding such Adjustment Da A. notwithista.nding the fact that the Index may, as of acme Adjustment Date , be Less than the Index as of the ;4 previous Adjust.%Rnt Late or the Base Year Index . In addition, >a the increase in rent pursuant to this Section 2 . 2 1;1 any given five (5 ) Lease Year par. iod shall nit exce?ea twenty-five percent '1 (25%) and the increase in rent from one Lease Year to the next shall, not exceed ter. percent ( 10 ) . When the adjusted rent is determined, Lessor shall giVee Lessee written rot.ice of same p indicating how the new figure was computed. If at hny Adjustment Date the Inlex shall not exist in the same format as { recited in this Section 2 .2, Lessor and Lesseo shall agree to substitutes any official index published by the Bureau of �J Labor Statistics, or successor or similar governmental agency, as mny then be in exiest*ncea and which is most nearly equivalent , e to they Index. Should Lessor and Leaan*e be unable to mutually w agree as to any such substitute index prior to the date such + agree*sent, is required in order to properly and timely comply with this paragraph, determination of %he proper substitute index shall bey by arbitration in accordance with Artie lea XXVII . C*SSW2460/13 -13- e,� OEM& t � , 7 r 7 . 3 P.Mitional Pairne nts . Except a, otherwise provided ;14 this Lease, al.i GUMS 04' money or charges whatsoever required to l.�e paid by 'Lessee to Lessor under thi a 1.!.-ase other ;-an rent sha 6 l be due and payable ten ( 10 ) days of tet demand, without any dec ttctior_s or. )£fret wlha;scever. Lessee ' s failure to pay any such amounts or charges when due shall carry with it the same consequences as Lessee ' s failure to pay rent and shall be deemed to be additional rent. Lessor shall have no obligation 't to bill or make demand upon Lessee for quarterly rent ;.nd such rent shall be delinquent If not r, eceivhd by Lessor on the date r� Itirdue . 2 . 4 Place of Payment; Late Pa)Mme:nts . Le:asee agrees to pay the rentAl and other charges herein reserved to Lessor at the address specified in the nr1tic%� r::ov;y azons of this Lease payable to the City of lluntingtor, Beach or to such other person and/or at such other place as Lessor may from time to time designate in writing. Any installment. or rent or any additional charges or rent which shall. not be said within ten � i ( 10) days after the due date shall bear interest at the rate of three ( 3 ) perctntage points above the discount rate of the Federal Reseive Bank of San Francisco (not to excaed the maximusm legal rats per ..�itted by law) from tho day which is ten ' ; 10) days after the due date until the day the rent: is paid. D% addition, with respect to any delinquent payment of runt or other sum due to Lessor (lout to no other person or entity) 063 5r 2/24 0/12 -16- w 'hereunder not paid x ithJ n the tatter of ',:iv,,- ( 5 ) days of t cr written Potice from Lesso: to Lessee Lind ten ( 10 ) days of'Cer the dl:cr date , Lessee shall pay to Les Tor &a; A la; e chzrge an additional payment: equal to five percent. ( 5 ;; of such delinquent payment. Following each second consecutive late paaymant of rent and/or additional charges after the latter of q five ( 5 ) days after written notice from Lessor to Lass,ee and b tan ( 10 ) days after the due- elate, Lessor shall hav the option t to require that beginning with the first payment of rent due following the date such second consecutive late payment was due, rent shall no longer be paid in quarterly installments but zhaxll be payable in annual installments in advance; provided, a t however, that: in the event Lessor exercises ouch option to require arinual installments of rf:nfi and additional charges in "dvaance and thereafter Lessee is not delinquent it the making ` of any such annual insta:11ments for a period of five (f ) years, after the fifth .such consecutive annual i.istallment is timely made, theroufter rent will agair► be payable quarterly in advance until such time as two consecutive late payrrics.its after the latter of five (5) days after written not.. from Lessor to Lessee or ten ( 10) days after the due date agair. occur at which time Lessor shall again have the option to require annual t instaallmants an aforesaid. All payments shall be made in lawful Monay of the United Statea. tall payments requiring J proration shall be prorated on the basis of a thirty (30) day f month and a ninety (90) day quarter. f 0636n/2"0,/3.2 -1' + s a,y z I 2 . 5 LesFjor' s Right. to Au6i t . Lass or rshall have the right at any time and fs:om tirae to titne upon rearanable notice to Lcss�.'n , and v* Lessor ' s expense , to rc,.view and examine at the Prainises ;:tie info,6 maticn contained ir. Lessee ' s s books, records , and :ederF.l and Etatee :income tax returns relating to the grn:.s income and revenues derivod from sales, rental of hotel rooms, and nervicez provided on the Premises (but not information relating to expensas; or profits of the Project or information unrelated to 'the Project) for the sc le and limited purpoaa of verifying whether Lessee and any subl essse:e n, operators and lconcessionaires conducting business on the Premises -have { properly xeported and paid taxes all or a portion of which are collected by or paid, directly or indirectly, to Lessor or the l Agency (including without limitation sales taxers and transient ( occupancy taxes) relative to the conduct, of such lousiness+ ( es3 ) . In addition, and subject to the same limitations, Lessor shall h"ve the right for any given period to have such limited information contained within Lessee' s books , records, and tax returns audited by a disinterested, rep::taib! a fx,rm of certified public accountants sselrcted by Lessor at Lessor' s expense . { Losses shall a for a period of at least seven (7 ) years from J the end of each Lease Year, keep safe and intact within the Promises or at Lessee' s offices located no morn than fifty ( 50) miles from the Promises all of the books , records, tax return --, Information and other da-ca which are subject to Lessor' s review _1 'vivo • a. 1. w w M i' under this ,section . S aiic. regiiIarly ).e£ . by Lessee in the ordinary -:ourse of it:, buoiness . All information obtained by L,esso)• in ac ordanc v with its right.,] under, MELis Section 2 . 5 shall be treated as ccn£ident:inl by Lessor and its agents and accountants and Shull not be disclosed except as requirec; by l.aw or as reasonably necessary to prcatect: Le5E;oi• or to enforce L,essor ' z ricjhts and remedies and/or Lesbee ' s duties and obligations hereunder. w 2 . 6 No Abatement_of Rent . Lxcepl as expressly provided in Sections 1.4 . 4 arJ 15 . 2 of tUs Lease, Lessee shall not be entitled to any abatement, diminution, reduction, setoff or postponement of rent as a consequence of any inconvenience to , interruption of , cessation of or loss of Lessee ' s use of the •r•i Premises or Improvements as a result of any reason whatsoever including, without limitation, any events or unavoidab� -relays described in Section 25 . 1 (unless sam% results from the impn-& er or wrongful actioxis of Lessor ) . 2 . 7 Re*it freeze. Notwithstanding any other: provision of ;:his Lease to the contr airy, provided that Lessee is not in material default hereunder or under the DDA ( or is in the ► + process of curing such default in accordance with this Lee.sr: or thf DDA) , the Initial Rent set forth in Section 2 . 1( a) s'.sove shall not be adjusted pursuant to Sections 2 . 1 (b) or 2.2 in the *Vent that Lessee does not complete a Disposition Transfer of a wf f4parate Development Parcel puzwuant to the DDA for any of the following reasons: A'1" AOMMI 110. i 06/01/88 0631SU/2"0/'12 19- , „ ( r� ) The Agency has committed ct MtAtCriel default under the r:DA; or (l�) The Agtnicy his failed or refused to ti:%ely accuire and terminate all of the property interests/occupancies in the Site ov that portion of the Paci f.Lc: Mobilehoine Fark property that must be acquired and terminated pursuant to Saction3 201 and 301 of the .ODA as a conditAnn to the close of escrow for such. Separate Development Parcel ; o:: ( c) Lessor or the Agency have famed, or ,refused to timely approve .any of the plans ( including final building plans) for. said Separate Development Parcel which are required to ba approved purnu$nt to Sections 203 and 301 of the DDA as a condition to the close of escrow for such Separate Development Parcel, provided said plans ara in, full conformity with the DDA and Lessee has exercised best efforts to obtain such approva' s; or ' (d) The Agency has unreasonably faired cr refused to timely approve Las&ee ' s evidence of financing commitments for this development of said Separate Development Parcel which i • � financing commitments are required to be aprroved as a condition to the close of escrow pursuant to Sections 204 and y� 301 of the LDA, and Lessee has exercised best efforts to obtain _7 such approval; or (a) The Agency hR& unreasonably failed or refused to Jtimely approve a hotel operator or hotel franchisor as to any Separat• Deveelopment Parcel on which Lonsee is otherwise 064$U/2460112 -20= N 1 rac,iu,i red to c-onfitruct; a hotel , which mpproval a are. .required puvsuant ::o Section 205 , 206 , end 301 of the IDDA Rs a. condition to the clone of escrow for. such SF:parate Development Parcel , and Lessee hp.s exercisext bo%st effort; to obtain sucks approvals . Not.hi.ng in this Si c: tion 2 . 7 in intended to limit or affect; Leezec' s right, to specific performance under the DEIA. A.-RTICLE 711 . LESSEE' S RIGHT OF FIRST MFUSAL To PURCHASE PREMISES 3 . 1 Lesseev a Might of First Refuse l tc Purchase Premi less . Retween the Term Commencement Date and the expiration or termination of this Lemse, and so long as Lessee i.a not in def&,j.lt hereundev ( or is in the process of curing such a default) , Lessor shall not sell , convey, transfer, or otherwise dixposss`e of all or any portion of or any interest in the Premises (other than a pledge of any of it4 income under this Lease) until it shall first have offered such portion or interest to Lessee in the manner specified below: (a) i.o•.sssor deliver sa notice ( the "Notice" ) to Less** stating ( i ) Lessor' s bona ride intention to sell, trans fer or otherwise dispose of all or any portion of or any interoat in the Promises, ( ii ) the portion or interest. proposed --= to be sold, transferred or otherwise• dirposed of ( the "Offered I i'x, mo• i 5�246a�lz - 2- �" r Interest:" ) , And ( fii. ) t.}le o-,fc;.ing pricv2 and all other materia3 !.errns for 0ii ch Lessor propose,-. to :Nell , transfer, or otherw:" Se di spuse of t M Offered I ntere nt. (b ) Vithin s-ixty ( 60) nays after receipt .,.f the Notice, r.es see or ry is permitted a sd gnee may accept Le.s-scar' u offer by delivering to Iou-;sox, a writing ay eeinq 4o purchase the Offered Inters rft on the terms offe:Ld by Les ior. Any auch acceptance of Le:efsor' s offer shall be accompanied by a deposit espial to tern percent ( 10%) of the purchase price which deposit shall be retained bl, Lessor as liquidated damages in the event that the purcha:Ne is not completed due to a default by Lescee . In the alternative, Lessee may. %,ithiu such period deliver a counter-offer to Lessor. Such counter-offer shalt be binding on Lessee a?Ld shall remain effective and may be accepted by Lessor for a period of one ( 1. ) !,,car from the date of delivery of the counter-offer to Lessor. In such event, Lessor small accept or reject Lessee ' s counter-offer within said one ( 1 ) year period. During such one ( 1 ) year period, Lessor may entertain offers and counter-offers of third parties to � purchase the Offered Interest. No such action sha].1 be deemed to be a rejection of Lessee' s counteroffer. At any time during said one ( 1 ) year period, Lessor may accept offers of third parties so long as the purchase price for t.?ie Offered Interest is in axs:•ss of th• price offered in Lesson' s coroner-offer sand/or the terms of the t%ird party of fer are more Lova rablee to Lessor than the terms of Lessee' s 0�/01/ilk 063Sn/2660/12 -22- f counter-offer . Acceptance by T wasor in writing of an otfr_r or counter-offer o� a third party to purchase the O:'fered Interest shall a rejection of Lessee ' s 4oun•L•er-offer . If L:t:ssee ac:c opts Lessor ' s offer to seLl the Offered XntereoL, or i:' r,esassor acr:ent.,c Leszee' s count:r• offer to piirchasr ,, tht. pattien shall connurnm to such purchase yromptl.y in accordance therewith ( c) ( i ) If Lessee and Lesser du not enter into an agreement: to purchase/sell the Otfcred Interest as set forth in subparagraph (b) above, or ( i9 ) if Lessee and Lessor enter into such an agreement but Lessee fails to complete the purchase as set forth in subparagraph (b ) above , Lessor may s3ell. the Offered Interest to any person at any price and upon any, t,:eMsr, as Lessor shall, determine , provided that such sale is consummated within one ( 1 ) year of the date of the initial. No-tics to Lessee and provided further that in the event of (i ) above, the purchase price for •the 'O''fered Interest, and the terms of the sale, shall be no less, or mare favorable to the purchaser, respectively, than the terms of any counter-offer by Lessee. For purposes of comparing whether an offer by Lessee- is more, or less favorable than an offer by a third party, any financed portion of the offered purchase price shall be: dincounted to present cash value using the prime lendinro rate of Wells Fargo Bank or comparable financial institution. If such mile is not co::9ummated within raid one ( 1) year period, Lessor mhall again be obligzted to first offer 11TTACA1tM 110. 1 �,. ii�/�1/I�� 0635n/2460/12 -23- YIY1S i 1� to st ll tha Offered Intereal to Lessee as utt forth ir. this Fection 3 . 1 ; provided, hoaievc , that Lessee' s rightH under this Article III shall terminate and be of no further force or c i'met if Lms.Ror and Lessee agree to a propc:�ed e,ale tc .Lessee of an Offered lntere�st constituting ten percent ( 1011�) or snore.. ; of the grass useable area of t:her Premizes and such sale is not consurinated clue to a default by Lessee of the terms of the written agreement of sale. In the event a person or antity k, other titan Lea -srs acquires all or any portion of or any int:srest in the Premise.=., such person or entity shall take ?� title to such portion c:- interest subject: to all of the terms J and conditions of this Lease , ARTICLE IV . (RESERVED) ARTICLE �T. T.A::ES AND ASSESSMENTS 5 . 1 Lessee' s Obligation for Taxed and Assessment's . ; (a) Goverrmtn tal Clear es . In addition tc the rents and other payments required to be paid under this Lease from th* Te&Tn Commencement Date t:hroug%, the expiration or termination of this Lease, Lessee shell be respcinnib2 a for, and j agrees to pay, prior to delinquency, any and all taxes, anaaesSMOAtOe ingtKIlmcaits of ':axes, lavl ee, fees and other gov►axnmental chaargws of every kind or nature (hereinafter collectively called "taxis" ) levied or assessed by municipal, 0635a/24W/12 + -i� .w was" r G ,Y I county , st:a� r, federal o:: other taring or as easing authorAties } or agencies or entit-les upon, against or with :expect to ( i ) t.hc Improvements , or ar portion thereof, ( 1i ) the Premises, or .a::y portion thereof, including without 11mitat-ion, Lessor ' s fee interest in the Premises, ( iii ) all �. fixtures, equipment and any other proper,:y of. Finy kind owned by Lessee nr placed, installed •-ir located within, upon or about A the Premises for which Lessor might be asres:sed or which might become z lien cii the Premises If not paid by Lessee , ( iv) all +.a as.teri..tion a , additions and improvements of whatsoever kind or A. nature, it any, made to the Premises or the Improvements, (v) f rental a-- or: other charges payable by Lessee to Lessor (other s� than state and federal income taxes applicable to Lessor) , and I (vi ) any ether interest in the Promises ( including the leace-hold intevest created by this Lease) , irrespective of whether any of the iterns described in clauses ( i ) through (vi ) above are nssessed as real or personal property, and i41 irrespective of whether any of such items are assessed to or agein;s: Lessor or Lessee, or any other person . The foregoing obligations of Lessee shall not constitute a waiver of Lessee' s rights to contast taxes, etc . , as not forth in subparagraph (d) below. if at any ttrie during the Term any of such taxes are not levied or asseened separately and directly to Lessee (for example, if the same are levied or assessed to Lessor as part of a larger tax parcel) , Lessee shall pay Lessee' s proportionate shares as netermined below in (b) . Any and all ATTAC$1L NT FO. 6 08/01/" 06j5ta/►2460/12 .025- i t; r I � i � taxes and assessments and installments of taxes and &ssessmente required to be paid by Leasr�e under this Lease shall be paid by Lessee betWi-e each such tax, assessment, or fnstallrtiert of tax :•� or assessment becomes delirqurnt and a copy certified by Lessee under penalty of perjury of the official and original receipt for the payment of such tax , assessment, or JAnstallment shall promptly be given to Lassor .. (b) Lessee' s Allocation. Lessee ' s proportionate ahAre of all taxes levied 4r anmeslsed against or with respect to the Premises or other matters described in Section 5 . 1. ( a) above, excluding the Improvements, which are not separately Li asse+ssto small be that portion thereof which the nurd)er of j LA square fact of the land area of the Promises bears to the total numbe &- of sclu-c.rt feet of lard area from time to time levied or LJ assessed with the Premises or any other fair and equitable manner as mutually deteimined by Leasor and Lessee . Lessee ' s L nhare of taxes levied or asse$ced against or with respect to the Improvements which are levied or assessed with other improvements levied or assessed with the Premises shall be determined by Lersor and Lessee in a fain and equitable alanraAr. Should Isessor avid Lie seeRts be unable to agree as described in this subparagraph (b) prior to the date such agreement is required in order to properly and timely comply f with this sub%action (b) and aubsectioz) ( a) , determination of err! L*esee' a proportionate uhsre shall le by arbitra_ to;a in aceordanct with Article XXVII . The tr.xe:s payable by Lessee r' A'L" RCMdzjdT V0 4. a 08/01/88 0635n/2460/12 -26- .ri r r 1 - . J i 1pursuant to this subsection (b) and suosect.ion ( a ) which are levied or assessed for the fisc&l tax year in which the Term commences and for the fiecal tax year in which the Term of this i Lease ends, shall be prorated on the basis of a 30 day month i and a 360 day year . Lessor agrees to cooperate with Lesser. , at no cost to Lessor, to cause the Premises to be separately assessed by the County of Orange if at any time the Promises are not so separately assessed. it (c) Substitute ,,^,fixes . Should the United States of z America, State of Californlp or any political subdivision w thereo: ( other than the Cit -7 of. Huntington Beach) or any governmental authority having jur:isdicti ii (by way of 14 substitution for all or any part of the "taxes" otherwise required to be paid in whcle or in part by Lessee pursuant tc this Section 5 . 1 or elsewhere in this Lease , or in addition thereto) oi.ther ( i ) impose a capital levy or a tax, assessmerit and/or surcharge of any kind or .nature upon, against, in r ccnnection with or with respect to the rentals or other charges , d payable to Lessor by Lessee or other tenants , lessees, occupants, operators or concessionaires in or of the Premises and/or (ii) impose a tax or surcharge of any kind or nature upon, against or with respect to the panting areas or the nimbex of parking spaces in the premises, then, in any such case,, such tax, assessment and/or surcharge shall be deemed to r constitute s tax and/or •ssesbment against the Premises and 1 Lessne shall pay its proportionate share thereof pursv.ant to this subsection, an billed by Lessor. 0635n/2460/12 -2 7- 5 ' �Y 4 1 (d) Contesting Taxes . Lessee shall have the right to contest, oppose, Or object to the amount or validity of any tax, assessment., or other charge levied on or assessed against °4 the, Preami,sco or any portionthereof; provided, howe:vFr, that J 1, the contest, opposition, or objection must be filed before the tax, assessment, or other charge at which it la directed becomes delinquent nt and written notice of the contest, A # opposition, or objection must be give to Lessor before the date the tax or assessment, or other charge becomes delinquent. No Such contest, opposition, or objection shall be continued or �. maintained after the date the Lax, assessment, or other charge at which it is directed becomes delinquent unless Lessee has , i met one of the following conditions : ( i ) paid each tax, assessment, ox ather charge �.a under prote3t prior to its becoming delinquent; 1 ( i.i_) obtained and maintained a stay of all proceedir•,s for enforcement and collection of the tax, p j aosesaament, or other charge: by posting such bond ar other a matter required by law for such a stay; or ( iii ) Delivered to Lessor a good and sufficient undertaking in a form rexsonably acceptable to Lessor' s 1 Executive Director, in an amount equal to one hundred twenty-five percent ( 125%) of the amount in controversy (inclusive of finum, interests, penalties, costs, and other es that expenses may have accrued or been imposed thereon) and issued by a surety company a►uthorizod to issue undertakings r XTTACffiUMT NO. 0 0635n/2460/12 -28- ! ' ws IF 1, � in California, conditioned on the payment by Lessee of the tax, assessment, or charge ogether with any fines , ' interest., penalties, costs, and expenses that may have 01 accrued or been imposed thereon within thirty (30 ) days ,4 after final determination of Lessee ' s contest, opp,oaition, or objection to such tax, assessment, or other charge. � d Lessor shall not be required to join in any proceeding or contest brought by Lessee unless the provisions of any law requ.il-ea that the proceeding or contest be brought by or in the mane of Lessor or any owner of the Premi. zes • In that case , Lea.eor shall join in the proceeding or contest or permit:. It to ; a be brought in Lessor ' s name but such action shall be without cost or other liability to Lessor and Lessee agrees to pay tc Lessor all costs incurred by Lessor in connection therewith . (e) Payment. Subject to Lsssee ' s rights under 0-4 subparagraph ( c) , supra, fcAlowing each second consecutive delinquent payment of taxes required to be paid by Lessee under ;his Section 5 . 1, Lessor shall hAve the right to elect to bill Lesese for any amount ,payable by Lessee under this Section 5 - 1 in periodic installments, in advance , from time to time, but not more often than gjarterly, and thereafter Lessee ' s failure to pax such amount to Lessor shall carry with it the same cons*quencee as Lessee ' s failure to pay rent and shall be a� detvAd to be additional rent. In such event, Lessor may so bill Lessee prior to Leaaor' u receipt of assessment notices ATTACMCINT We 9 08/02/88 0635n/2460/12 -29- Atl and/or tsx statements or bills covering any or all of the taxes payabla by Lessee hereunder. In the event the amount of the taxes described in this Section 5 . 1 for any fiscal tax year has fl not been made known. to L�esso= by the tax collector at the time of billing, Lessor shall have the right toy estimate. reasonably . :; the amount thereof and to base its billing to Lessee upon said estimated amount, and in suc-11 event-Lessor agrees to adjust such billing when the actual amount of such taxes is mane }mown to Lessor by -t:he tax colle ct:or. Yt: the event Lessor exercises such option to require Lessee to pay taxes to Lessor in Avance (instead of directly to the taxing authority) and thereafter Lessee is not delinquent in the making of any such installment J paymento for a period of five ( 5 ) yearn, after the fifth year. I.e 5see shall again be entitled to make: its tax payments directly to the taxing authority until such time as two consecutive delinquent payments again occur at which time a Lessor sha.11 again have the option to requires periodic a� Installment payments of taxes to Lessor- as aforesaid . In the event Lessor collects tax payments from Lessee pursuant to this s# Section 5. 1 , Lesser shall promptly pay such taxes prior to daelinqu*ncy. ( � ) Tax Returns And Stntements. Lessee shall , as between loossor and Lessee, hove the duty of Attending tn, preparing. making, and filing any statement, raturin, report, or " other instzume nt required or permitted by law in connection A, with the rdesteermination, equalization,, reduction, or payment of 08/01 r' e+r i any taxes, assessr.ente, or other charges that are or may be .� levied on or assessed against the Premises, or any portion ` J thereof, or any interest therein, or the Improvements or other property on the premises . Lessor shall cooperate with Lessee, , f at no cast to Lessor, as reasonably necessary for Lessee to ., comply with this subparagraph ( f) , including providing � q information and documents in Lessor ' s possession to Lesse© and executing necessary documents . ( g) Indemnification. Lessee shell indemnify, defend and hold Lessor, the Premises. Lessor ' s interest in the Pre:misea, and any Improvements located on the Premises, free and harmless from any lxabiiit;r, claim, logs, cost, expense or damage resulting from any taxes, assessments, or other charges required by this Article to be paid by Lessee, any loss, cost, expense or, damar,e , including without li .nation attorneys ' fees and court costs, incurred by Lessor or Lessee in connection with any such contest, and from all interests, penalties;, and ,W other auras imposed thereon and from any sales or other 4 p,rocradings to enforce collection of any such tare,-, , assessments, or other charges. (h) Payment Hy Lessor. Subject to Lessee ' s rights under subsection (d) , supta, rhould Lessee fail to pay within the time specified in this Article any taxes, assessmeenta, or other charges reequir:td by this Article to be paid by Leessee, Lessor may pay, disehargee, or adjust such tad, assessment, or other charge for the benefit of Lesset, but Lessor shall have M" AfTAC3DOW 00• 6 09/01/86 063Sn/2460/12 -31- r Marl,,. '�r1•. • . ., s, 4 net obligation so to do . In such event, Lease* shall promptly reimburse Lessor for the full amount incurred by Lessor in e,-2 paying, discharging, or adjusting such tnx, assessment, or f other charge together with interest thereon at the rate required to be paid by Lessee for 0alinquent rent i:-c,m the date of r�ec, ,neent b Leaaaor until the dLtee repayment ent in received b . Y p Ym Y " Les )r From. Leaseee . ARTICLE VI . [ RESERVED ) ,i ARTICLE VIX . USE AND COMPLIANCE WITH LAW t • 7 . 1 Use of Premises . Subject to Lesizee ' s rights under the DDA and under the Development Agreement entered into between Lessee and Lessor on or about AucmAt 15, 1988 (the "Development Agreement" ) , Lessee , at Lessee' s e:•xpegnne, sha?.l promptly comply with all valid and applicabl* present and ;futu:ce laws, ordinances, erde,7z, rules , regulations and regjireements of all governmental authorities having jurisdiction of, or affecting or applicable to this Promisees or Improvements •-)r t -e cleanliness, safety, occupancy 1 and us* of the same, whether or not any such law, ordinance, A order, rule, regulation or requirement is substantial, or forees"n or unforeseen, or ordinary or extraordinary or shall • 1 . neCeessitate structural changes of the Improvermente or interfere e A'!" ACMUM N A 6 .ti I rrs A S ` with the use and enjoyment of the Premises; provided, that nothing in this Secticn 7 . 1 in intended to conGtit:ute a waiver by Lessee of its vested rights, if any , its rights, if any, to maintain a legal nonconforming use, or its rights under the DDA and the Developsn_,a keiraro►.lent. If ,any governmental license for p,ormit shall be required for the proper and lawful. conduct of Lessee ' s businebe or other activities carried on in the Premises, then Lessee, at its sale: expense, shall, duly procure S end thereafter maintain such license or permit, or Cause such procurement and maintenance, and submit the came for inspection by Loozor. Lessor will cooperate with Lessee , at no cost to Lessor, as may reasonably be necessary J.n order to assist Lessee in complying with this paragraph, including making appearances at hearings and executing documents. in addition, Lessee shall not commit: or suffer to be committed any wastes upon the Premises or any nuisance or other, act or thing which disturbs the quiet enjoyment of owners or occupants of property adjacent to the prenissess; provided, however, that so long as they Improvements ss constructed and maintained are in full compliance. with tb*t DDA and all permits • and other requirements of law, no claim of breach of this paragraph may b* mads by Lessor based on a claim of nuisance. J ,= In addition, Lessee shall not, remove any of the Improvementu ' frou the Premises, nor waste, destroy or modify any Improvements or the Premises, eerceapt as permitted by this p � Leesse�. I , W/01/88 06354/2490/22 M33 M """ ti Y " 7. rant Of- Uses , Easements . Leases® may enter into agroments restricting use or granting easements over the Promises, provided ahoy are limited to the Term of this Lease or, in the case of .restrictions or casements in favor of other. "Separate Development Parcels" within the. "Commercial Portion" of the "Site" (as those terms are defined in DDA) , provided they are limited to the term of the lease( a ) for such other Separate Dev?lopm.. nt Paresl( s) . Such restrictions and easements shall not adversely affect the determination o:� the market value of the fee of the P:-omiees or the market rental y: value of the Premises as get forth In Article II , and shall not be i.nconsietent with any of the c:,venan;:s , conditions, or restriction, on Lerisee ' s use of the Premises as set forth herein . Lessee must obtain Lesso.•' o prior written consent to any restrictions on 41-ae Premises, its use or its alienation, inconsistent with the f—dreagoing. In addition, Lessee must also obtain Lessor ' s prior written s:onsant to cartain assignments of a Y.essee' s interests Ira w.he Premises and this Lease, am more particularly set forth in Article XV'I below. ^� 7.3 Non-Discrimination. Lessee: covenants for itself, its hears, oxecutar!! , administrators, and assigns, and all persons clalminq under or through it, that this Leaoea is made and r accepted upon and subject to the following conditions: That -,� there shall he no discrimination aqainat or segregation of any a person ar group of 1, ersons on account of race, color, creed, M34- •IA rx. J Ji 0d V I• religion, sox, marts scl ssstatub , age, national origin or ancestry In the; subleasing of the Premises herein leased, nor shall the sere establish or permit an such practice or practices a �� P Y p of discrimination or segregation with reference to the selection, locations, number, use or occupancy of sublessees wh the Promises . In the event Lessee enters into contracts , lenses, subleases, or assignments w- 'h respect to any of its interest •i i Mrsin, Lessee shall include in such arrangements a nondiscrimination claus:,e rubsstanti.ally conforming to the following: ( a ) In leases. "The lessee herein covenantsby and for himself or herscelf, his or- her heirs, executors, adminisstrat�.ra, and assigns and all persons claiming under or through him or her, that Chia lease i!a :Wade and accepted upon and nubject to the following conditions : "That there ;shall be no discrimination against or a*gregatio;_ of any person or group oi. persons on account of race, color, creed, religion, sex, marital status , a national origin or ancestry in the subleasing, transferring, -uss e.. occupanncy, tenure or enjoyment of the: 1 promises harm in leased, nor shall the lessee himself or hersalf, or any person claiming under or through him or c her, establish or peer+ait any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of lessssoca of the prowAsesa. " i 0635n/2 400/22 ft 3 S- ti7 (b) In contracts and assignments : "There shall be no discrimination against or segregation of any person or group at persona c,A account of race , color, creed, religion, sex, marital status , age; , national origin or .a ancestry In the subleasing, transfer, use , occupancy, tenure or enjoyment of the premises, nor shall the transfethee (or assignee) himself or herself, or any person claiming under or through him or liar, ar;tablirsh or permit any ruch practice or practices of d acrimination or segregation with reference to the selection, location, nuzibeer, use or occupancy of the premises . " ARTICLE VI I I . LESSOR COVENANT TO RESTRICT USE OF CITY SEhC11 PRO ?ERTY 8 . 1 recitals . ( a) Lessor is one of the owners in fee of thE,.t certain real property located. in the City of Huntington Beach, CaliiorniA, and mounded on the north by the right-cf-way line for pacific Coast Highway, on the east by Huntington Beach ' Mate Park, on the south by the mean high tido line of the Pacific Ocean, and on the worst by an imaginary lint.,. extending southward from the westerly side of the intersection of Pacific Coast HigWay Nt'td Huntington Stroat (hereinafter referred to as ., the '"City Beach Property" ) . The City Beach Property is -more particularly described in fthibit "C" attached beereeto and :a incorporated herein by this reference . iri/� bQjl -36- . r (b) Pur-uant to the LDA referenced in Section 1 . 11 9 of this L.eaet , it is Contemplated that Lessee will b-t constructing, operatinq, and maintaining on the Separate I Development Parcels within the Commercial Portion of the wits ocean-oriented visitor-serving coitiunercisl Facilities which are dov�igned to take full Advantage of the exiAting ocean views mexoss Pacific Coast Highway. Lessee desi7es to obtain ass-arancos from Leasor that such views will not be obstructed ,Suring the `ei•m of the modified I,easeas to be entered into between the Huntington Beach Redevelopment Agency and Lessee � pug:suent to Sectiois 1 . 11 , Exhibit "A" hereto, anti the DDA. ( c ) Pursuunt to the Cali iornit Coastal Act of 1976, as nmended (Public: Resources Code Section 30600, jLt 2 . ) , Leesor has prepared and the California Coastal Con—imletsion has certixied 9 Local Coastal Plan (hereina*ter the "LCP" ; for that perti= of the City of Huntington Eeach that a.s located within tna Coastal Zone, irx3udeing the City Beach Property. On January 19, 19SI, the City Council of Lessen adopted Resolution No. 4954 adopting the LCP in the fora of the Coastal Element of the City' s General Plan; the LCP has subsequently been amended through the City Council ' s adoption of Resolution No . 5147 on _. August 2, 1982 , Resolution No. $267 on. May 16p 19631 and Resolution No, 5341 un January 3 , 1W . The LCP is a public record, a copy of which is availahler ;.or inspection at the office of the City Clark at this City of Huntington 13�aeh, 2000 Main Street, Huntington Beach, California 92649. The LCP requires "Preservation of as much beach sand area as possible in order to acconnodat® future lsvels of beach ...,I I1'1''�k'AC'Y�l4 NT NO. 6 �/Oi/B� 0635n/2 460/22 -3 7 t y: i attendance. " ( I.i^F, Section " . 3 . ) Tyre I.CY FL�rttlEr establishes as a policy the "increased numbers o.t hotel./mote). rooms. arld c d rtataurants In the Coat tal Zone . " _ :d , at Sec tion 3 . 3 , ! The LC? desi nites i:hr: et:tire City B(_-:.i7h 114roperty for recrea:.ione.1 us* in which the "principal permitted ut;ev art +mites, to open sa d areas, beach related rf!creational activit{ c: , anti under certain conditions, prr%incj lots , ci.:►ic•essioni:.. and a . cjAj,. :)itig , " ( Ici, at Fiqure 9 . 11 and Section 5 The UT f.urth-t� r "Prohibit( s ) dai�elopmeni. o- permanent ah, ".-gro:"nd .� z1.rL1,Ct11rP.5 Cn the 1aE:ach taan: airei,:'' an thn City Beach 1 vop_ "tj, tait:li t},�: F��c:rpti on of a.wfecn.tatci :.r}trerr and o-Cher p►ib is s�tfat-. 1 , r )� 1 �.czi h c tr.tcil.it�icu, I,�sb)_ac �rest.roorn:� r,t�ci . . �c.z c.c,nc.�:..���. oti s;tat_c1,. Whell located {nirr.ediat:ely :adjaccAlt: to paved j al.):ing .0!: access 8."'t'.Fl$ , a:.J c. � i:'�gs, .,ol l�!ybal nets, bik.o. tza. 1 -, YAke suyl po:. t: i'a..•ilitics . and hrindicapp-,d access . r-Ar -illy, th=.: LCP urc• ' '�,'. t' s) exyan:-z i Un of parking f aci?it,iess th is. would ret„ait " in tho to .,; of roc reat:i,:)na] ar,za . . . '' ( z-:i, at r section %) . 5 , 1 . (c�,) On C-7�.r;ber 10, 158 the city of r,essor adopted Resolu i e.,nA Igo . 5308 a, b and c approving and adopting the Downtown Specific Plan (hereinafte.r the " Specific Plan" ) for the Implementation 4i' the 1,CP . T).ae entire City Beach Property It located in District Eleven of he Specific ?'lano which Is designated for beach-.:of ated open space an d rocr+eational uses. District eleven "in inter►ded to preserve end protect the Mandy beach area within the (Dmmtown) Specific Plan b,)urdor;le■ while allowing parking xne: auxiliary 00/01/U Jl'" ACNIMVT fib. i �i1S�/246n/1� -:��- �. ;I . convenionea uses. " 15peacific Plan, Section 4 . 13 . ) Pursuant to the Specific plan, the only users and structures permittod on they City 044ch Property are access facilities, basketball courts, beach concession stands at intervals no closer than, one f thousand ( 1 , 000) feat and limited to two thousand five hundred s (2, 500) square feet per building, , bicycle and jogging trails i„ and support facilities, fire ring&, lifeguard towers and other structures necessary for health or safety, paddiaboard courts, surface parking lots or public transit facilities that will not result in the loss of recreational sand areas, provided that any tiered parking shall ba designed so that the top of th* structures including walls, etc . , are located a minimum of one fdot below the maximum heiight of the adjacent bluff, park F' offices, playgrpund equipment, public reestrooms, public drrossing rooms or showers, shoreline construction that may alter natural shoreline process (such as gzoize*, cliff retaining walls, pipelines, and outfall■ that are: designed to e11minato adverse impacts on local shoreline sand supply) , and volleyball net supports (a) City and Lessee desires to ensure the lonq-term I maintenance of the City Beach Property for beach-related uses consistent with the LCP and Specific Plan, to promotes the development and operation of high-quality vloltor-servinq ccmuercial uses an the Promises, and to provj de 4 long-term sourkt.'e of reavenue to the City to enhance the City' s ibplema►w:,ation of the LCP and Specific Plan or for other public purposes as determined by the C#ty in its sole diarretion. diJC�1, 063 are/:460/12 71'1'Ta1C'B 6 r� 1 ' �h prM i •Y ,, l 1 v' • 9.2 Aeatri'ctidns on AeveloAment on City beach Property. . 1 Lessor covenants neat to construct or maintain or permit to be constructed or maintaineA any improvements or structures on the ~• city beach groparty excepting dnLy the following: access facilities, basketball courts, Leach concession stands at intervals no closer than one thousand (1,OOO) feet and limited to two thousand five hundre .; (2, 500) square feet per building, F � bicycle and jogging trails and support facilities, fire rings, lifeguard towers and other structures necasstry for health or safety, paddleboard courts, parking late and public transit facilitie% that will not result in the lose of recreational sand area and that will not extend above the existing grade of the adjacent stretch of Pacific Coast Mighway, park offices, play4iound equipment, public res trooms, public dressing zooms s � or showers, shoreline construction that may alter natural shorealino process ( such as groins, cliff retaining walla, pipelinez, and outf ells that are designed tv eliminate adverse impacts on local shoreline sand supply), volleyball, net ; r supports, and pedestrian overcrossing ( s ) of Pacific Coast Highway. 8. 3 Ftyments. In consideration of Lessor' s agreement to ;restrict development on they City Beach Property as set forth herein, Leos** shall pay to Lessor the amounts set forth below: (a) For each Lease Year from i989 through 2000, inclusive, the sum of Five Thousand Dollars ($5 , 000.00) per Lease Year, payable in advance on the first day of each such year. ATTACMXIW go. s 08/02/8d 1 063SA/2460/12 -40- Ir (b) for each Lease Year from 2001 through 2013 , r r ' inclusive,, or the earls sr termination of this Least, the sum at Ton Thousand Dollars ($10,000 .00) per Lease Year, payable in advance on the first day of each such year. 8 .4 tro t o be Benefited by Citit' s Covenant. The covenants met forth in Sections 8.2 and +8. 3 are intended to �i burden and benefit the City Beach Property and the Premises. At such time that there is a Disposition, Transfer of. a Separate Cevelv;=ent parcel Vithin the Rea;.14c,'itial Portion of the Site, pursuant to the DDA, the benefit and burden of this Agreement shall, be ramoVed from such Separate Development Parcel only. At such time that there is a Disposition Transfer of a Separate Development Parcel vithin the Commercial Portion of the Si1ta, pursuant to the DDA, the benefit and burden of this Agreement shall continue in effect with respect to such Separate Development Parcel . At -such time that the DDA is terminated, the bent it and burden of Sections P,.2 and 8 . 3 shall be removed from any portion of the Premises that has not been the subject of a Disposition Transfer. Accordingly, after all of the � t. Disposition Transfers contemplated in the UDA have occurred, tho benefit and burden of this ''Agreement shall apply to all of the Separate Development Parcels within the Commercial Portion of the, Site which have been the subject of Disposition Transfers (with tht understanding that if for any reason a Separate Development Parcel within the Clommercial Portion of the Site is not the subject of a Disposition Transfer, the i .� A7l"P714�tILE11? �lC1. i 08/01,/B8 0635n/2460,/12 r� 1 y Gino #WON ` I benefits, accruing to the remaininq Separate Development Parcels within the Comorcial Portion of the Site which have been the subject of Disposition Transfer* shall not be adversely atfected) , and the benefit and Y urden of this Agreement shall not apply to any of the Separate I)evelopment Parcels within the Resf dontiAl Portion of the Site or any other portion of the Ute. The City and Lessee agree to •cooperate and execute all documents that may be reasonably required in order to effectuate this provision. 8. 5 Covenants Run With Thee Landlord„Recordation of Memorandum ,..r..� . .r of keaspThe parties intend that the covenants seat forth in thus Article VYII bey enforceable as equitable servitudes and corisrtitutee covenants the burden of which shall run with the ; land and bind successive owners of the City Peach Property and bon6fit assignees and sublessees of Lessee ' s interest in the ,✓ Promises and the Separate Development Parcels within the eo . Commercial Portiou c,f the Site, all within, the contemplation and for the purposes set forth in Section 1470 of the California Civil Code. Immediately following the Effective Data of this Lease, Lessor shall cause a Memorandum of Lease which spec1f ically references the restrictive covenant 1� contained within this Article VILE* to be recorded against the City ,Reacb Property. a8�ol�e8 0633n/2460/12 ft42ft t r q c. ARTICLE IX. MAINTENANCE Of LEASED PREMISES i s Obligations 9gr Makinten_ange . (a) Clbliyations. Subject t the application �� • of Articles XIV and XV in the event of casualty or condemnation, tessue, at Leesseo s expense without coat to Leesbor, ' shall keep and maintain in good order, condition, t . equality, and repair (i6cluding replacement of parts and �i equipment szi'd rraz ( as defined in this Lease) , and refurbishing of hotml roomer., if necessary) the Improvements and • avery part thereof and any and all appurtenances thereto wherever locaterd# 4naluding, but without Limitation, the interior and esite►r#or surfaces of all exterior walls, roofs, the exterior i and interior portions of 'all door*, door f*aal,es, door checks, w trash enclosures, planters attached to the Improvements, other entrances, -windows, window frames, plates glass, atoreefrontee, , lobbys, signs, all plumbing and privately.-maintained sewage and iwi • other utility facilities servinq the Premises, including free flow up to the main newer line, fixturts, ventilation, heating • ,t wM air conditioning and *electrical systems (whether or not located in the Improvements) , sprinkler systeerna, floors and ceilings, and all ether work performed by or on behalf of Lossoo, and all other repairs, replacements, renewals and r "j restorations, interior and exterior, structural and �1 nonstructural, ordinary and extraordinary, foreseen and unforeseen. When used in this Article, the term "repairs" A�r'T318'P 3R0. i 08/01/89 0635n/2460/12 =43- YY ,a 1 r r OWN, 'R. • 1 shall include modifications, improvements, additions, dolations, alterations, replacements or renewals when necessary, And all such repairs made by Lessee shall be at 141aatt equal in quality and class to the original work Losses shall keep and maintain all portions of t: Premises and - Improvtments and the sid.awalks adjoining the same in a clean and orderly condition free of accumulation of dirt and rubbish. t x f"''Lessee wishes to snake any repairs to the Improvements which result in a change, in use of the Improvements permitted by this Lease, or materially adversely y .,,Affect the value of the premises or Improvaments or 'materially 4hon,ge the external structure or appearance of the 'r Ymproveraentw, them Lessee shall submit to Lessor fcr its approval documentation which describes the desired repairs, Including floor plans, building sections, building materials and components, samples of proposed %xterior building materials, and the like, to the extent relevant to the i� particular repair. Lessor' s approval shall be given within a reasonable period of time not to exceed sixty (60) days after receipt by Lescox from Losses of all necessary documents and .f information relating to such repairs, and shall not be unreasonably withheld provided that the proposed repair shall not, in Lessor' s reasonable judgment, impair or, diminish the value or structural integrity of the Improvements, have the likely result of diminishing the income or revenues of Lessee r over the Term of the Lease, or not be in harmony with neighboring buildings. ATTACRNRNT poll i O6/01/se 063Sn/2460/12 =44- r rr r •84.v,A1' ,1F , 1•. Y � yI •A " OEM 'J'• . fluy In addition to the foregoing, throughout the I'dtA1 of ttiis Lease and "y extension hereof, Lessee shall keep,'' maintain and operate the Premises and the Improvements in accordance with all valid and applicable laws of the State of California and in accordance with all valid and applicable direction*, rules and regulations of hoilth officers, fire marsballs, building inspects&s and other proper officiale. of ,i • the governmental agencies having jurisdiction* and insurance }� uyWorwriters, and heaisee shall comply with all requirements of ' laws, ordinances, rules and regulations and otherwise affecting the premises and the Improvements, all at the sale cost and •. expense of Lessees , provided that nothing In this Section 9 . 1 Is intended to constitute a waiver by Losses of its vested rights, if any, to maintain a legal nonconforming use, or its rights under the DDA and the Development Agreement. furthermore, at any time prior to a Disposition Transfer pursuant to the DDA, Lessee may, at its option, and subject to Complying with applicable legal requirements, . demolish and clear any of the Improvements on the Promisor as reasonably determined by Lessee to be necessary or appropriate to prepare for the development !contemplated under tho DDA. (b) Procedure For Resolution of Disputes RRlatirS to Lessee's„Maintenance of the Premises. If at any time Lessee shall fail to comply with the requirements in Section 9 . 1 (a) , but not more frequently than once every twanty--four (24) months, Lessor shall be entitled to deliver written notice to ATi'RCMU h'P NO. i 0636n/2460/12 -45- rg� �• r f.i i '"� 4 • " Less** (herein a "Notice of Deficiency" ) stating that the 2jogovownte and/or Promises are or are not in such condition and `"ttihq fortlh, in detail, the rep airs and' replacementa, if airy, necessary t'p put the Improvements ar d;car the Promises in such condition as described above -and/or stating that the operation of the Improvements is or is not satisfactory and setting forth, in detail, the ohangeee in operations, if any, V 1. necessary to put the operations into the manner described 3 'e ve. 'If Lesset disputes the need for any repairs, w r, replacements or changes in operation referenced In Lessor' s -' Xotica of DowficitincY. Lasaee shall deliver written hotics to Leiser of such dispute, within thirty (30) days after delivery i of Lessor' s notice and promptly after delivery thereof the I dispute shall be submitted to arbitration as not forth in Article XXytt of this Lease . If the determination of the .., arbitrators requires any of the repairs,. replacements or changes in operations set forth in Lessor' s notice, or if Lessee shall not have disputed the re:q&irements set forth in '! Leasor' m n6tieee, Lossee' shall make such repairs, replacements ,i or changes In -operation promptly and diligently. Losses shall be required to correct any deficiencies in the maintenance or operations of the pre' misees and the Improvements within as reasonable time exercising dub diligence after notice by Lessor but in no event shall such time exceed twelve (12 ) months of xuch notice, and during the period that Lessee is proceeding with such corrections it shall not be deemed to be in default )zereu�zder. ATTACMIM 90. d 08/02/88 063 Sn/2460/lf 4b- ` !s •r. • (�) Li,ns. Subject to the lest sentence of this Section p* 1(r) , Lessee shall keep the Promises and the ,r imprwoments fare from any and all liens arising out of any f work performed, materials furnished or obligations incurred by or for Loma** or others, or otherwise affecting the Premises or -I rovements, and agrees to cause to bi discharq*6 of r000rd any, mechanic ' s or materialmen' s lien within twenty (20) days . J after the lion has been filed or wit1iin twenty (20) days after receipt of written request from Lessor. , whichever uhall be the sooner. Leases shall give Lessor at least fifteen (15) days written notice prior to commencing or causing or perinitting to b& commenced any work on the Promises (whether prior or subsequent to the commencement of the Term) the cost of which s is in excess of $25, p001 so that Lessor shall have reasonable 6pportunity to file and post notices of none-responsibility for Lessee,'' s work. If Lessee fails to timely remove or bond for a lien as provided in this Section 9. 1(c) , Lessee shall reimburse. OA Lessor for any and all costs and expenses which may be incurred by Lessor by reason of the filing of any such liens and/or t.1 removal of same, such reimbursement to be made within ten ( 10) days after receipt by Lessee from Lessor of a statement setting forth the amount of the costs and expenses . Lessee may contest .; any such lAon. provided Lessee has first secured and posted with Lessor a surety bond or bonds in the amount of one hundred and twenty five percent (125%) of any such lion issued by an undsrwritor reasonably acceptable to Lessor securing payment of ATTACMUNT No* i 0635n/2460/12 - 47- 1 V such lion in the event Lessee ' s contest thereof is unsuccessful or Lessors athearwise fails to have the lion removed of record timely. (d) Lessor' s Substitute Performance. In the event Lessee fails, refuses or neglects to commence and complete any i required repairs or ma►inUnanc a within the times set forth in section 9. 1( a ) or (b) , to remove or bond for any lien within the times not forth in Section 9. 1 (c ) , to pay any cost or expense slating to much matters, or otherwise to perform any act or fulfill any obligation, required of Losses pursuant to this Section 9. 1, Lessor may, but shall not be required to, make or complete any such repairs, remove such lion, and pay ` such cost and expense of 'Lessee, and Lessee shall reimburse Lessor for all costs and expenses of Lessor thereby incurred within ten ( 10 ) days after receipt by Lessee from Lessor of a statement setting forth the amount of such costs and expenses which shall be deemed to be additional rent and subject to the same consequences as herein provided for failure to pay rent. If reasonably possible under the circumstances, Lessor shall give .Lessee vLitten notice teen ( 10) days prior to commencement of any substitute performance. Any failure by Lessor to give such notice, however, shall not prejudice Lessor' s rights hereunder o:: alter Lessee' s obligations hereunder. Leasor' s ruts and remedies pursuant to this subsection (d) shell be in addition to any and all other rights and remedies provided under this Lease or mt law. ATTACs1MNT 90. i 06/01/;38 062$n/2460,/12 0,4a- iMT1'"SFr. I• „A,,,• i it4 Mom" ..• r r a e) O, ership of.1 morovem ants. The Improvements, and any FUS not covered by the definition of "Imp''rovements", shell be owned by Losses and, to the extent arplicable , by Lrrssee' s vendors and permitted sublessees rind concessionaires, until expiration of the Lease Term,, or the sooner termination of this Lease. However Lessee shall not remove an of the i Y Improvements from the Promises, nor waste, destroy or modify any Improvements of the Promisas, except as permitted by this Lease. Upon expiration or sooner termination of this Lease, all of the Improvements (which term is intended to exclude FUZ. personal property, and any signs containing a business nano, .trademark,, s;mbol, logo, or design) that are made or placed in or on tha Premises by Lessee shall be considered part of the real p-:•operty oi' the Premi e s and shall remain on the Premises and become the property of Lessor; Lessee shall have 1 , , the right, to remove all other property which is not the , property of Lessor, provided that such removal shall be cotap1.eted within thirty (30) days after the expiration or tarlier termination of the Term. ARTICLE X. INSURANCE AND INDEMNITY I f 10. 2 Lessee ' s Insurance . ( a) T ear. Lessee, at no coat and expense to Lessor, fi shall, commencing oll the date Lessee is given access to whe ( remises for any purpose, and during the Term, procure and keep i + 06/02`88- J In full force and effect or cause to be procured and kept in full force and effect for the mutual benefit of Lessor and Lessee insurance policies meeting the minimum reTtirements set forth below or such greater requirements that are generally obtained from time to time for properties, improvements, activities,. and operations similar to those on the Premises in the Southern California area: (i ) compr,%hensive general liability insurance with respect to the promis4a and the operations of or on behalf of Less%e and all 11Nasees, tonants, licensees, 1 operators and concessionaires in, on or about the premises r in an ameunt not less than Five Million Dollars ($S,000, 000 ) per occurrance' combined single limit bodily injury, personal injury, death and property damage liability per occurrence, subject to such increases in amount as Lessor may reasonably requ�re from time to time but not more frequently than every 36 months; provided, that the percentage increase in coverage shall not be t re ired to exceed the qu percentage increase in the Tndex sincs the last requested adjustment in coverage. The insurance to be provided by Leases may provide for a deductible or self-insured retention of not more than One Hundred Thousand Dollar D r ( $300, 0D. b0) , with such amount to Increase at such timer as Lessor may require increases in the policy limits an set forth above; provided that the percent,t9s Increase in the deductible or self-ii%sured retention shall not exceed the percentage increase in the 063$n/2460,"12 -50- =Nip `�t { �f •'' f �t s. Index since the last requested adjustment; and further provided that Losses may maintain such higher deductibles or a*if-lnsured retention as shall be acceptable to the Executive Director of Lessor or his designee . in the event such insurance dogs provide for deductibles or self-insured retention, Lessee agrees that .it will fully protect Lessor, its boards, officers, and employees in the same manner as t}'llii iritaayrasaarts would have been protected had the policy or policies not contained the deductible or retention provisiond. Coverage shall include but not be limited to, to the extent applicable to the type of business(es ) and operations on the premises, personal injury liability (with standard exclusions for liability assumed under contracts and suits brought by employees deleted) , premises and operation, blanket contractual , cross liability, severaability of interest, broad form property damage, Independent contractors, owned and non-owned automabi le, garagekeeper' s liability, inkeeper' s liability, and dramsbop and liquor liability coverage. policies shall inelud+e aN provision (1) that coverage shall be primary as , .. respects any loss or claim aariaing directly or indirectly saes out of the operations of Lessee or others, any policies carried by Lessor shall be excess arrnd anon-contributing with such policy or policies, and (2) that !,eassor shall be an additional named insured under such policy or polici.ec, and (3) containing cross liability and severability of interest clauses providing that the insurance applies separately to each insured except with respect to the limits of %ability; 08/02/08 ATTACURNT NO. ai �i 0635n/2460/13 -s 1- i • f r e I ','r"a c ^oP"•th �Cl! 7� I, ':,�W� ,:Iy�^y r i. , , „y�, •1 ,./11'` / I y 1 f [ li •I Y ( ii ) worker casrpsrheation coverage as required �w� y law) ; ( ill ) with respect to improvements, alterations and the like requires.,:: or permitted to be made by Lassie* ! herei!nder and under the DDA, contingent liabiiity and f buildar" s risk ( course of construction) insurances iV) with respect to the Improvements, and merchandise, stock, trade fixtures, furnishings, equipment { and other items of personal p operty locarted on or in the Premises, insurance against fine, peril of flood, exten.ded coverage, vandalism and malicious mischief, and 'Isucb other additional perils, hazards' and risks as nog+ 'are or may be includid An. standard "ell ribk" fom" ar in general use 'in Orange County, : California,' yr th the stands:' form fire ►wr insuanct coverage in an amount equal to not 'leant than the r ;- full ' current actual raxolacesrant cast thereof, and the: aedditional coverage provided by the "all risk" coverage in an amount not loss that twenty-five percent (25%) of the full current actual replacement cost thearoof. Lessor shall bs an additional insured under suc.1i policy or policies and euc?. Insurance shall aotstrsin a replacement cost endorsement; (v) boiler and machinery insurance coverage for t� all objects, including but not limited to boilers, pressure vessels, pressure piping and other major compoiiento or any s� centralized heating, air conditioning and cooling systems; a and f 1 J A"AMMIM 1, G8�C1/Qg 0633 /2460/12 �� - , i t \ r � yr• 5 ?r', ri t (vi) comprehensive automobile , liability insurance u coverage for bodily injury ( including death) &nd ,property { damage which provides total limits of not, less than five million dollars ( $5 , 0 0,000) combined sinplo limit dcaurrence applicable to all owned, non-awned ai.d hired 1)T� Subject to the next sentahce below, Lessee shall further r its licensees, concessionaires and subtenants to maintain insurance at thoir own okpensee as follows: (i) livability insurance in substantially the same form as required of Lessee by this Section 10. 1 of this Leases (with the amounts of coverage and+ deductible 6r � self-insured retention as reasonably determined by Lessee ) ; .a, ( ii ) worker' s compeenzation insurance in iubstantially the same form as required of -Losses by this Section 10. 1 of this Lease; - (iii ) Zoth policies of insurance required by ( i ) and ii cdx�ovee shall have the following endorsements copies of which shall be provided to Lasses and to L*ssar, If Lessor so reequestn: (aa) Inclusion of Lessor as an additional named insured as reespecti this Lease; (bb) Cross liability and saverabili.ty of r ' intere:sta clauses providing that the insurance apply separately to each insured except with respect to the limits of `iability; and r ' t - A"AC t MCA. 0 0695n/2460/12 -si- r j • r (cc) Stipulation that the insurance is _ primary insurance and that neither the Lessor nor its insurers will be called upon to contribute to a moss . -�> Lessee may satisfy this requirement by providing such insurance coverage ifor its licensees, concessionaires, and/or subtenants undue the insurance policies it is required to maintain hereunder. (b) Standard. All policies of insurance required to be carried by Lessee under this Lease shall be written by responsible and solvent insurance companies authorized to do buainesc in the State of Cali.."ornis. Any such insurance required of Lessee hereunder may be furnished by Lessee under R any blanket policy carried by it or under a separate policy therefor. A copy of each paid-tip policy evidencing Stich insurance (appropriately authenticated by the insurer) or a certificate of the insurer, certifying that such policy has A bien issued, providing the coverage required by this Section 'and containing provi2ions specified herein, shall be delivered to Lessor prior to the date Lessee is given the right of r possession of the Promises or as Lessor may otherwise require, and upon renewals, not less than thirty ( 30 ) days prior, to the expiration of such coverage .. Lessor may, at an time and from � g Y� Y time to tine, inspect and/or copy any and all insurance policies required to be procured by Lessee hereunder. In no event skull the limits of any policy be considered as limiting the liability of Lessee under this Lease . O63StV2460/22 -Sa- -.mow,.... ....... wig 1 . J *111 h' ( C ) oeci.fic Provisions in Pol_ Cy. Each policy ' svidearing insurance required to be carried by Lessee pursuant to this Article shall contain the following provisions or clwakes I (1) a provision that the insurer will not cancel, or materially change the coverage provided by such policy without first ,;diving Lesson thirty (30) days' prior written notice; and ( ii ) a waiver by the Leamee' s insurer of any right to wibrogation against Lessor, its agents, employees at W,to representativeb which arises or night arise by reason of any payment tinder such policy or policies or by reason of any act or emission of Lessor, its agents, employees or } representatives. (d) Landlord' s Substitute PerformanSe. In the avant that Lessee fails to procure, maintain and/or pay for at the times and for the durations specified In this Section 10. 1, any Insurance required by this Section, or fails to carry insurance ►'+ required by law or governmental regulation, Lessor may (hilt without obligation to do so) at any time or from time to time, after thirty, (30) days written notice to Losses, procure such Insurance and pay the premiums therefor, in which event Lessee shall repay Lessor all sums so paid by Lessor together with 1 interest thereon as provided elsewhere herein, within ten ( 10) days following Lessor' s written demands to Lessee for such Payment. M1 C635n,/244;0/12 -55- ri. ., (ee ) Commercial Availability. Notwithstanding any other provision in this Lease to the contrary, Lessee' s r ,I obligation to procure and maintain insurance, and the coverage , terms, and conditions of such insurance, shall be conditioned upon the coca trcial availability of such insurance, coverage, terms, and conditions, at reasonable commercial rates; provided, hovaveer, that the foregoing condition of commercial availability. shall be inapplicable if the particular insurance coverage is not commercially available due to the wrongful acts or omissions of Lessee , dangerous or hazardous activities of } Lessee, or activities not Contemplated by this Lease. If at any time during the term any of the insurance otherwise required pursuant to this Section 10 . 1 is not so available, Lessee shall promptly so notify Lessor, and Lessor and Lessee Lj shall agree upon such changed, altered, or reduced insurance requirements as shall be reasonable under the circumstances, provided that the insurance regquirements* set forth herein shall again tes,ke effect at such time as such insurance again becomes commeercial..1 y avl%ilablee at reasonable commercial rates. In the: event Lessor aytid Lessee are unable to agree on applicable Insurance requirements,ts, the matter shall be resolved by arbitration in accordance with the procedures set forth in Article XXV1I below. AtTAOMM 'i' 30. i 0635a/2 /i` 0.56M . .1-4 4C., r 40 }MlS,,•fix• � � '.7, .�1.t 1 n; alw .k�lokkMN�l{�fV 1 ' 10.2 ( Cavernant to Indemnify and Hold 'harmless 1 Lessee covenants to defend and indemnify Lessor, its officers, pJ cUreNctors, partners, representatives, agents and employaes, and aN► comsors and assigns; and same it and them harmless fron and against' any aarA all clilms, actions, losses, damages, liability, costs end expenses, including attarneya' foam, in connection with the loss of • life, bodily injury and/or damage to property &ri sing from or , at of or in connection with any occurrence in, upon or at the Preemizes or Improverments, or the occupancy or use by Lessee or any other person of the Premises or Improvements - or &my part thereof, or arising from or out of Lessee' s failure to comply with any provision of this Lease or otherwise occasioned wholly or in part by any act or omission ,N 4 of Lessee, its agents, representatives, contractors, employees, servants, customers, invitees, trespassers, guests , tenants, le3seem, concessionaires, operators or licensees , or their Customers or invitees, excepting only that the foregoing indemnification and hold harmless agreement shall not apply in the eVent of any uninsured willful or actively negligeer+t wisconduct an the part of Lessor or any of its agents, representatives, - or employees, or in the event any such claims, actions, losses, damakges, liability, costs, or expenses arise out of a broach by Lessor of its obligations under thip Lease . In case Lessor shall Abe made a party 4o any litigaxtinn commenced by or against Lessee, then Lessee shall protect, defend and hold Loseor harmless and shall pay all costs, r 0"SU/24W/12 -5 /- p r , F , 1 expensis and reasonable attorneys' fees incurred or paid by Lessor in connection with such litigation. Lessor may, at its option, require Losses to assume Lessor' s defense in any action covered by this Section through counsel selected by Lessee and rsesonaly aatisfaotory to ' Lessor. Lessee, as a 'material pert of ttlie consideration :,o Lessor, hereby assumes all risk of damage to property or injury to 'persons in, upon or about the � Premises and Improvements from any cause whatsoever, and Lessee hereby waives all its claims in respect thereof against Lessor exr^eptihq only damage or injury arising out of ( i ) the ► 1 uninsured willful or actively negligent miseon6uct of Lessor or any of - its agents, representatives, or employees , mr (ii ) a breach by Lessor of its obligations under this Lease. 10. 3 Eximgtioh of Lessor. Lessor shall not be liable for rr •.ww�w•� �J11 inju'ryi, loss or damage to person or property or loss of business which may be sustained by the person, goods, wares, merchandise or property of Lessee, its employee4, invitees, or dustamers or any other tenant, licensee, lessee, quest, trespaa,ser, operator, concessionaire or other person in or 4 about the Premises or Improvements caused by or :resulting from any cruse whatsoever, including, but not limited to, acts of others; theft, fire , steam, flood, electricity, gas, or water or rain, which easy leak or flow from or into any part of tho 1 Premises, or Improvements, or from the breakage, leakage, obstruction or other defects of the pipes, sprinklers, wires, J J � •pA. i ,'1"tI1Cm1aS� 063Sh/2460/13 -59- • V, l. .. ; i I , it appliances, plumbing, air conditioning or lighting fixtures of 1• the Improvements, Whether the injury, loss or damage or Loss of buciness results from conditions arising upon the Premises or from other sources, except that the foregoing exemption of liability shall not apply (i) to Lessor in its capacity as a governmental agency (as distinguished from its capacity ao the _ fee owner of th* Premises) , to the extent that such liability rr� would otherwise exist in accordance with existing law, (if) to the extent any injury, loss, or damage arises out of the ,._.: � uninsured willful or actively negligent misconduct of Lessor or any of its agents, representatives, or employees, or (iii ) to the extent any injury, loss, or damage arises out of a breach w,j by Lessor of its obligations under this Lease. Lessee Rhall ; give prompt notice to Lessor in case of any casualty losses in • 4 excess of five poc'reent (5%) of the combined value of the ' Improvements, FF&F, and personal property on the Premises, and in the event of any lawsuits filed against Lessee arising out .. f of Lessee' s occupaaricy or operations in which the amount In. controversy exceeds One Hundred Thousand Dollars ($1.00, 000) . Lessor shall not be liable for any damages arising from any act or neglect of any other tenant, lessee, conceasi i,onairo, licensee, inviter, quest, trespasser, operator or customer of the prodass or Improvem' ants. 10.4 Waiver of Subrogation+ Each party hereto does hereby valve, realise, release and discharge the other party hereto and any officer, director, shareholder, beneficiary, partner, ATTACMMM n0. i Og,/0l/5g 0635n/2"0/12 -59- i s � ' 1 .M �w agent, employee or rwpresnntative of such other party, of and �- from any liability whatsoaver hereafter arising from loss or damages for which insurance containing a waiver of subrogation Is Carri.ed by the injured patty under such insurance. Lessee shall, upon obtaining the policies of insurance required hereunder, give notice to the insurance Carrier or carriers ,.� that the foregoing mutual waiver of subrogation Is contained in Y 4 I.J this Leao e . 1n1 ARTICLE XI . UTILITY CHARGES 11 . 2 Utility Charges. Lessee shall pay all charges for gage, water, sever, electricity, telephone and other utility services used on or in the Premises and/or the Improveme�lts duriAg the Term. If any such charges are not paid when due, Lessor -may pay the same after giving Lessee ten ( 10) days prior written notice, and any amount so paid by Lessor shall thereupon become dram to Lessor from Lessee as - additional rent. . •, This section 11 . 1 it not intended to relieve Lessor from its obligations with respect to the provision of utilities as set forth in Attachment Non. 3 and 5 to the DDA. ARTICLE XII OFF-SET STATEMENT, ATTORNMENT AND SUBOR I I NhT I ON 12 . 1 Off-Set Statement. The patties shall, at any time and !prom time to time upon not less than ton ( 10) days' prior ATTACK E? No• i 06359 /2"0/12 -Go- 1 ni•M 1 l 1 dEft 1• writ on notice from the other party, execute, acknowledge and deliver to such requesting party a statement in writing (a) I certifying thht this Lease is unmodified and in full force and i effect (or, if modified, stating the nature of such modification and certifying that this Lease, as so modified, is In full force and effect) and the dites to which the rent and -,� other charges are paid in advance, if any, without any offset or defense thereto (if such be the case ) and (b) acknowledging that there tre not, to such certifying party' s knowledge, any uncured defaults on the part of the requesting party hereunder, or spucifyinq the defaults if any are claimed. Any -such statemsnt may be relied upon by any prospective p=:haser or encumbrancer of the Improvements , the Premisao or of all or any portion of the real property of which the Premises are a part. Lessee shall bear all costs with respect to any statements requested of Lessor. 12 .2 Attornmet. Itx the event any protoedin4! ire brought for the foreclosure of, or in the event of the conveyance by deed in lieu of foreclosure, or in the event of exercise of the r power of sale under, any mortgage and/or dead of trust made by Lessor, covering the Premises, or, subject to ' Article III, in -; the event' Lessor sells, Conveys or otherwise transfers its irAte rest in the Premises, Lessee hereby attorns to , and covenants and agrees to execute an instrument in writing reasonably satisfactory to the now owner whereby Lessee attorna to the successor in interest and recognizem the succtsaor as the Lessor under this f 0635n/2460/12 - 1� r' t r 22. 3 Subordination. Lease* agrees that this Lease shall , at the, request of the Lessor, be subordinate to any mortgages or deeds of trust that may hereafter be placed upon the fee of the Premises by Lessor and to any Arid all advancer to be made r thereunder, and to the interest thereon, and all renewals, replacements and •atensions 'thertof, provided the mortgagees or beneficlarie■ named in said mortgagees or trust Pleads shall agree to racognl zo the interest of Lessee under this Lease in the event of foreclosure, in accordance 'With the terms of this Lease . Leesmen also agrees that in the event Lessor and any mortgagee or beeneficiaky elect to have this Leave prior to such mortgage or deed of trust, and upon notification by Lessor or such mortgag*e or beneficiary to Lessee to that effect, this Lease shall be, de*med prior in liven to such mortgage or deed of trust, whether this Lease In dated prior to or subsequent to . the ,date of said- mortgage or dead of trust. Lessee agrees that upon tke request of Lessor, or any mortgagee or beneficiary, Lessee shall execute whatever Instruments may be required to carry out ' t,'he !•nteent of this Section. 1 .4 oEdination of Fee . Lessor shall have no obligation to *=umber or otherwise subordinate its fee ; Interest fn the Promises. 04151V2 46C/12 w 62- 1 r 4 ...rasp ''• � ..t' ARTICLE XIII . ALTERATIONS AND ADDITIONS 13. 1 Alterations and Additions . Without Lessor s prior written cor%sent, which consent may be withheld or granted in Lessor' s solo discretion, and except as permitted in the DDA, including any of the development plans and approval& obtained by Losses thereunder, and further except as set forth it 1 Section 9 . 1 of this Lease, Le sssee hal not have v the right to ° make changes or alterations in the Improvements or the Promises, except on the following tonditionst (a) Lessee shall not make any alterations," whether ., structural or non-structural , which, when completed, will materially decrease the value of the Premises or the Improvements, or convert any building into a structure which is not a complete, self-contained operating unit; . e� 1 (b►) Before the commencement of any work, Lessee shall pay the amount of any increased premiums on Insurance policies provided for h*reunrier= (c ) Lessor shall in no event be required to make any alterations, rebuilding, replacement, changes, additions or 11Vrovoments or repairs to the Premisen or. Improvements during the Torn; and (d) All such changes, alterations, rebuilding, replacoasnts, additions, improvements and repairs to the Improvements maxis by Leewee shall he deemed to have attached to the roalty and to have become the property of Lessor upor. the 'MO A 6 08/01/86 0635r/2460/12 -63- P 1 >' �M� - : P expiration of the Term or upon oonner termination of this p Lease, to the same extant as with the original Improvemi-nts . 16ossee shall not remove any of such Improvements, as changed or *lter*d, with the understanding that trade fixtures, furnishings, and personal property installed by Losses or its tenants; or lessees shall not be classified as "Improvements" as that term is used herein and may be 'removed, provided that Lessee ehetil promptly repair any damage caused by such removal. Subject to the senior and prior rights of the owner( s) avd persons or entities having a security interest in any of • the trade fixtures, furnishings, and personal' property ( if otbar, than Lessee) , in no event, whether during the 'term of this Lease or upon the expiration of this Lease, shall Lessee be entitled to remove e!.ny trade fixtures, furnishings, or personal property If Late** is in default hereunder, except that during the Term of /this Lease Lessee may remove trader fixtures,,-furnishings and items of personal property if the T. same are immediately replaced by trade fixtures, furnishings M arA items of pevoonal property of like quality and value. ART'l= XYV. GASUhLTY LOSS AND RESTORATIOA ` e� 14. 1 Non_TMinatlon. Except as provided herein, no de traction or damage to the Improvemeenta or the Promises by fire, windstorm or other casualty whether insured or uninsured shall entitle Less** to terminate this Lease . e� 063.%n,/2460/12 -44- 1 .Is A 14.2 A,.,,atir of Damage. (a) Obligation to Repair Damage Due to Caa-salty ter\ \�. ...T\ `� �pveered by Insurance . Subject to Section 14. 5 below, if the Improvements shall be totally or partially destroyed or ` 4ndared wholly untenantable by fire or other casualty required to be ''irirured against by Lessee, • Leessee shall promptly proceed to ,,,obtain Insurance proc*ods and take all steps necessary to begln reconstruction and, immediately upon receipt of insurance proceeds, promptly and diligently commence the repair or w� replacement of the Improvements to substantially the same sw condition as they are required to be maintained in under this ,:•� Lease, ithather or not the 1nnurances proceeds are sufficient to 'ceaver . the victual cast of to toration, and shall complete the same as soon as possible so that, ' !ssee may continue 1n occupancy. Subject to Section 25. 1 , in no event shall the rep'icement per.ied exceed two (2 ) years from the date Lessee obtains insurance proceeds. Lessor shall. cooperage with 1.4 sari Lessew, at no expenses to Lassor, in obtaining any governmental permits required for the restoration. If, however, the thin-4xistinq lags of any other governmental agencies with 111riediotioai over the premises do not permit the restoration, s1 , Lessee may elect to terminate this Lease by giving notice to 06J Lessor (ire which event. Lessee will be entitled to all insurance i proceeds) or Lessee may reconstruct such other itaprcvements as are consistent with applicable land use regulations and 4 approved by the City, Lessor and the other governmental agency or agencies with jurisdiction. Ir r 'r• h' M Md. t I 06JD1/68 0635n/2460f12 =65- .0 ♦ . �4 'f11 'F ( • r �aiy sc, ; 1 �` ,1 • i I (b) &Rplicat on of IfisgrPonce, Proceeds, All Insurrace Honeys recovered on account of damage or ,Idestruction, lose tht a:- Cost, .if anyt, of such recovery, shall be applied to the payment of, tbO. "watt of vepairinq and repla►ckhq the Improvements. fxaept.,.Mo otherviss provided herein, if net available insurance :,. manias shall, be Insufficient. to pay the dnti►r* Coat of such . wark,, or .if .tho damage or, destruction shall be the result of a as-Use, not requirC.A C.A . to be insurtd against., then Lease* shall beau the cost thereof in excess o: the net available insurance monies. 14.3 ContinM041 220ratioas. wring any period of repair, � Lessee ,shall continue, or Catxatr .the continuation of, the operation or the businesses on The Promisee to the extent reasonably practicable from the standpoint of `prudent businaas aanaNgement: Howov.�'r, irraspectivaa of the continued operation of businesses during 6vch period of repair, the rent payable hereunder shall not be deferred ,(except as provided under . I •,q Sootion `2 4 / 4) and shall not be aabited. upon completion of such repair and restoration Less** thall promptly refixturo and restock the liprrorr+amente, if Aseesareeary, substantially to the condition prior, to the casualty, or as otherwise required by this Lwasa,. whicbevair•`.is greater, and shall. raopaeiA .for. busine 8, •• ,1f closed by the casualty. Ltesee shall cause all operators, lesseias, tenants and other occupants to do likewise. • r .r 0633n/2"0/12 r.