CITY OF PERTH INDEX

COUNCILMINUTES - 776 - 13 JUNE 2000DETAILS:Mr Stephen Onesti, through his company Jaxonvale has operated the City Station Pharmacy sincethe additions to the City Station were completed in 1989. A very satisfactory landlord/tenantrelationship exists and Mr Onesti has never been in breach of his lease.For the last four years, Mr Onesti has employed Sun Chuan Tan as a dispensing Pharmacist. In thattime, Mr Tan has become an integral part of the business and Mr Onesti has decided to recognise hisinput by selling a 35% interest in the business to Mr Tan, effective from 1 July 2000, subject to theapproval of the Council and an agreement to extend the term of the lease to coincide with the term ofthe loan.FINANCIAL IMPLICATIONS:ACCOUNT NO: 145 6339 525 039BUDGET ITEM:City Station RentalBUDGET PAGE NUMBER: 11BUDGETED AMOUNT: $471,974 (this component $88,900)INCOME TO DATE: $81,665.00ANTICIPATED INCOME TO 30.6.00: $88,912.50BALANCE:GST Implications:There are no new GST implications attached to assigning an existing lease. However, for theavoidance of doubt, it is proposed that the deed of assignment and variation of lease incrued a clauseto record the City’s ability to pass on any GST assessed on the rental or the recovery of outgoingsassociated with this lease from the next review date.COMMENTS:As Mr Onesti will continue to personally guarantee the performance of the lease once it has beenassigned to his company and Mr Tan’s company, the City’s position is strengthened by the proposedassignment of this lease.The Bank’s insistence on the lease term coinciding with the term of the loan to be taken by Mr Tan isin accordance with normal commercial practice. Accordingly, approval of the lessee’s request forthe lease over the City Station Pharmacy to be signed to Jaxonvale Pty Ltd and S.C. Tan Pty Ltd,with personal guarantees from Stephen Paul Onesti and Sun Tuan Tan, and for it to be extended to30 June 2010, is recommended.Moved by Cr Tudori, seconded by Cr GoodmanThat, in respect of the City Station Pharmacy, the Council approves:-M:\CON992000\MN000613.DOC