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HomeMy WebLinkAboutD-3 Billboard Relocation AgreementSCHEDULED ITEM/PUBLIC HEARING D-3 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL VIA: TROY L. BUTZLAFF, ICMA-CM, CITY MANAGER FROM: KURT CHRISTIANSEN, FAICP, DIRECTOR OF ECONOMIC AND COMMUNITY DEVELOPMENT DATE: JANUARY 3, 2017 SUBJECT: PUBLIC HEARING: CONDITIONAL USE PERMIT (UP-2016-04), VARIANCE (V- 2016-08), AND BILLBOARD RELOCATION AGREEMENT (S-2016-21) FOR CONSTRUCTION OF A BILLBOARD TO BE LOCATED AT 223 S. AZUSA AVENUE, AT THE SOUTHWEST CORNER OF AZUSA AVENUE AND THE 210 FREEWAY OFF-RAMP (HILTON HOME2SUITES HOTEL) SUMMARY: Net Development Company, developers of the Hilton Home2Suites Hotel at 223 S. Azusa Avenue, have submitted an application to the City for the approval of a billboard relocation agreement (“Agreement”). The Agreement was negotiated by City staff, Sign One LP (the entity created by Net Development to own the sign) and Lamar Central Outdoor, LLC (the billboard company). In accordance with Section 88.38.085 of the Azusa Municipal Code, the Agreement must be approved by the City Council. In addition, pursuant to Section 88.38.070 (C) of the Azusa Municipal Code, a freeway-oriented sign must be approved through a use permit. Furthermore, because the Agreement contemplates the relocation of the billboard to a parcel located closer than 100 feet from residential property required by Section 88.38.085 (B)(5)(e) of the Azusa Municipal Code, a variance must be approved for the project. The applicant has since clarified that the billboard will be located within 90 feet from the residential property located east of the proposed billboard. On December 14, 2016, the Planning Commission held a public hearing and recommended that the City Council approve the project. The proposed actions consist of opening the public hearing, receiving public testimony, closing the public hearing and adopting Resolution No. 2014-C4 approving the billboard relocation agreement. RECOMMENDATION: Staff recommends that the City Council take the following actions: APPROVED COUNCIL MEETING 1/3/2017 Billboard Relocation January 3, 2017 Page 2 of 9 1) Open the Public Hearing, receive public testimony, and close the Public Hearing; and Adopt Resolution No. 2017-C4: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA CALIFORNIA APPROVING A BILLBOARD RELOCATION AGREEMENT (S- 2016-21) TO ALLOW THE RELOCATION OF A DIGITAL BILLBOARD TO 223 S. AZUSA AVENUE, A USE PERMIT (UP-2016-04) TO ALLOW THE DEVELOPMENT OF A FREEWAY-ORIENTED SIGN AT 223 S. AZUSA AVENUE, AND VARIANCE NO. V-2016- 08 TO ALLOW A BILLBOARD TO BE LOCATED AT A PARCEL WITHIN 100 FEET OF RESIDENTIAL DEVELOPMENT DISCUSSION: The project involves the removal of an existing billboard located at 16721 E. Arrow Highway, which is within the sphere of influence of the City, and construction of a new digital billboard which shall include a dual sided LED digital billboard sign, associated sign pole, and three static signs for the businesses on the adjacent commercial property located at 223 S. Azusa Avenue, on the southwest corner of Azusa Avenue and the 210 Freeway off-ramp in the City of Azusa. The billboard will be constructed on a site that will eventually be developed with a Hilton Home2Suites and a McDonalds restaurant. The agreement provides the billboard company with a lease over a portion of the Home2Suites/McDonalds property for the maintenance and construction of the sign. The billboard has been located in an area of the development that does not conflict with either use, yet is the most visible to the I-210 freeway. The billboard sign will also include sign panels advertising the Hilton and McDonalds to I-215 travelers. A drawing of the proposed billboard is attached hereto as Attachment 2. A map showing the proposed location of the billboard is attached hereto as Attachment 3. Section 88.38.085 of the Azusa Municipal Code also requires an applicant to negotiate a billboard relocation agreement that provides public benefits to the City. In addition to the removal of an older billboard in the City’s sphere of influence and construction of a new billboard that provides advertising and economic development opportunities for advertising Azusa businesses, the billboard relocation agreement provides the following terms and financial benefits to the City: 1. Twenty year term with two (2) - five (5) year extension options; 2. Advertising opportunities for public service messages; 3. Voluntary advertising restrictions on products that are harmful to children; 4. Revenue sharing between the City and Owner that will provide the City with $75,000 per year from the billboard company, with CPI cost of living adjustments after the 5th year. 5. Additional royalty payments equal to 25% of Sign Income (defined in the agreement) that exceeds the aggregate amount of the Base Rent to be shared equally with the Owner (12.5% to City & 12.5% to Owner). The Agreement has been substantially negotiated between the property owner (Sign One), Lamar Advertising Company and the City. However, additional non-substantive changes may be made by the Owner and Lamar based upon their needs. These should not affect the City as the City’s role in this agreement is to merely authorize the entitlements, issue appropriate permits, inspect the sign improvements and monitor compliance. In any event, the current version of the Agreement is attached to the Resolution, which is attached hereto as Attachment 1. Billboard Relocation January 3, 2017 Page 3 of 9 Site Characteristics The property where the billboard is proposed to be located is in the vicinity of the southwest corner of the 210 Freeway and Azusa Avenue, in Azusa, California, designated by the Los Angeles County Assessor's Office as Assessor Parcel No 8614-014-920 (portion). It is located immediately adjacent to a parcel recently approved for the development of a hotel and quick serve restaurant. Adjacent Land Uses, Zoning and General Plan Designation LAND USE: ZONING: SITE Vacant General Plan: Corridor Commercial Mixed Use Zoning: Corridor South Azusa Avenue NORTH: I-210 Freeway N/A SOUTH: Vacant; Future Development of Hotel and Quick Serve Restaurant General Plan: Corridor Commercial Mixed Use Zoning: Corridor South Azusa Avenue EAST: Vacant; Future Development of Hotel and Quick Serve Restaurant General Plan: Corridor Commercial Mixed Use Zoning: Corridor South Azusa Avenue WEST: Residential General Plan: Neighborhood Low Density Residential Zoning: NG2 Low Density General Plan Conformance In accordance with the General Plan, the development is in conformance with the following General Plan Policies: In accordance with the General Plan, the development is in conformance with the following General Plan Policies: Goal 4. Improve the visual appeal of the City. Policy 4.2. Encourage attractive gateway treatments to establish a positive image of the city its districts and corridors. Policy 4.3. Require signage to be designed considering the scale and materials of adjacent buildings, the desired character of the neighborhood, district, or corridor where the site is located, and pedestrian orientation. Policy 9.3. Promote business development that can support the city’s property tax base, generate business-to-business sales taxes, and enhance Azusa’s economic health and quality of life. Policy 10.2. Promote Azusa’s competitiveness at the regional or sub-regional level in key strategic retail niches. Billboard Relocation January 3, 2017 Page 4 of 9 Environmental Review Staff has determined that the proposed project is not subject to environmental review under the California Environmental Quality Act (Pub. Resources Code, § 21000 et seq.) (“CEQA”). State CEQA Guidelines (Cal. Code Regs., § 15000 et seq.) section 15301, the Class 1 exemption, exempts from environmental review the operation, maintenance, leasing, or minor alteration of existing structures, so long as there is no or only a negligible expansion of use. Here, an existing billboard is being relocated, and there will be no expansion of an existing use. Further, State CEQA Guidelines section 15303, the Class 3 exemption, applies to new construction of limited numbers of small structures. Here, only one billboard will be relocated, and therefore this exemption applies. Finally, State CEQA Guidelines section 15311, the Class 11 exemption, exempts from further review the construction or placement of minor accessory structures, including signs. Therefore, the proposed project is exempt under this categorical exemption as well. None of the exceptions to the use of the exemptions, identified in State CEQA Guidelines section 15300.2, apply. The proposed project site has not been mapped or otherwise designated as a resources of hazardous or critical concern, no cumulative impacts will take place as only one billboard will be located on the receiving parcel, there are no unusual circumstances present that may result in environmental impacts, there will be no damage to scenic resources located within a state scenic highway, no hazardous waste sites are located on the proposed project site, and no historical resources will be substantially adversely changed. Therefore, the proposed project is exempt from environmental review pursuant to State CEQA Guidelines sections 15301, 15303, and 15311. Findings Use Permit No. UP-2016-04 (Freeway-Oriented Sign) Pursuant to Section 88.38.070 (C) of the Azusa Development Code, in order to approve the proposed Use Permit, the City Council must make the following findings of fact. 1. The proposed freeway sign is no larger or higher than the minimum necessary for reasonable visibility. The proposed freeway sign is 75 feet tall, which is 10 feet shorter than the sign currently in existence on the opposite side of the freeway. In addition, the parcel is located adjacent to and immediately to the south of the freeway on-ramp. The height and size of the sign is necessary for it to remain reasonably visible from the freeway proper. 2. The use or site cannot be adequately identified by other signs allowed within the applicable zoning district. The parcel on which the sign is to be located is adjacent to the I-210 freeway. In order for the use to be adequately identified by target patrons, a freeway-oriented sign is required. As noted above, the size and height of the sign are designed to provide reasonable visibility from the I-210 freeway. Pursuant to Section 88.51.040 of the Azusa Development Code, in order to approve the proposed Use Permit, the City Council must make the following findings of fact. Billboard Relocation January 3, 2017 Page 5 of 9 1. The proposed use is allowed within the applicable zoning district and complies with all other applicable provisions of this Development Code and the Municipal Code. The proposed relocation of a billboard is permitted under the City’s Billboard Relocation Ordinance (Azusa Municipal Code, Section 88.38.085) with the approval of a Use Permit. 2. The proposed use is consistent with the General Plan and any applicable specific plan. In accordance with the General Plan, the development is in conformance with the following General Plan Policies: Goal 4. Improve the visual appeal of the City. Policy 4.2. Encourage attractive gateway treatments to establish a positive image of the city its districts and corridors. Policy 4.3. Require signage to be designed considering the scale and materials of adjacent buildings, the desired character of the neighborhood, district, or corridor where the site is located, and pedestrian orientation. Policy 9.3. Promote business development that can support the city’s property tax base, generate business-to-business sales taxes, and enhance Azusa’s economic health and quality of life. Policy 10.2. Promote Azusa’s competitiveness at the regional or sub-regional level in key strategic retail niches. 3. The design, location, size, and operating characteristics of the proposed activity are compatible with the existing and future land uses in the vicinity. The location and size of the billboard are consistent with the use of the site for a future hotel and quick serve restaurant as they are all appropriate uses for freeway-adjacent properties in the Corridor South Azusa Avenue zone. The proposed billboard relocation agreement provides terms designed to protect the interests of the City and nearby residents by assuring that the billboard is modernized so that it is aesthetically pleasing and lighting is minimized away from sensitive land uses. 4. The site is physically suitable for the type, density and intensity of use being proposed, including access, utilities, and the absence of physical constraints. The site is physically suitable for the relocation of a billboard. The site is immediately adjacent to the I-210 freeway and to appropriate nearby uses including a future hotel and quick serve restaurant. 5. Granting the permit would not be detrimental to the public interest, health, safety, convenience, or welfare, or materially injurious to persons, property, or improvements in the vicinity and zoning district in which the property is located. Billboard Relocation January 3, 2017 Page 6 of 9 Granting the permit will not be detrimental to the public interest, health, safety, convenience, or welfare because the billboard will be located immediately adjacent to the freeway and will only be constructed subject to the terms of the billboard relocation agreement, which adequately protects the City and its residents. The proposed use will also be consistent with the operational standards of the City’s Development Code. Variance Findings Pursuant to Section 88.51.050 of the Azusa Development Code, in order to approve the proposed Variance, the City Council must make the following findings of fact. 1. There are special circumstances applicable to the property, including size, shape, topography, or surroundings, so that the strict application of this Development Code, deprives the property of privileges enjoyed by other property in the vicinity and within the same zoning district. The project site is a small, irregularly-shaped parcel located adjacent to the I-210 freeway. It is adjacent to a major Azusa arterial street and is visible to both eastbound and westbound traffic along the I-215 freeway. A billboard is an appropriate use for this parcel given its location along an unused corner of the property closest to the freeway. Because of the size and location of the parcel, it will likely be difficult to develop absent a variance since it must be placed in an area of the parcel that does not conflict with the existing improvements while still maintaining visibility to the I-215 freeway.. 2. The approval of the Variance includes conditions of approval as necessary to ensure that the adjustment granted does not constitute a grant of special privileges inconsistent with the limitations upon other properties in the vicinity and within the same zoning district. The variance is required as a result of the billboard relocation process. The City’s Billboard Relocation Ordinance has been designed carefully to ensure that billboard location is not a special privilege. The billboard relocation agreement proposed for approval simultaneously with this variance provides multiple protections for the City and its residents including among others advertising restrictions and requirements for the approval by the City of the construction activities. 3. The Variance is consistent with the General Plan, and any applicable specific plan. In accordance with the General Plan, the development is in conformance with the following General Plan Policies: Goal 4. Improve the visual appeal of the City. Policy 4.2. Encourage attractive gateway treatments to establish a positive image of the city its districts and corridors. Policy 4.3. Require signage to be designed considering the scale and materials of adjacent buildings, the desired character of the neighborhood, district, or corridor where the site is located, and pedestrian orientation. Billboard Relocation January 3, 2017 Page 7 of 9 Policy 9.3. Promote business development that can support the city’s property tax base, generate business-to-business sales taxes, and enhance Azusa’s economic health and quality of life. Policy 10.2. Promote Azusa’s competitiveness at the regional or sub-regional level in key strategic retail niches. There is no specific plan for this property. Billboard Findings Pursuant to Section 88.38.085 of the Azusa Development Code, in order to approve the proposed Agreement, the City Council must make the following findings of fact. 1. The proposed agreement is consistent with the goals, objectives, purposes and provisions of the General Plan, the Development Code and any applicable specific plan. In accordance with the General Plan, the development is in conformance with the following General Plan Policies: Goal 4. Improve the visual appeal of the City. Policy 4.2. Encourage attractive gateway treatments to establish a positive image of the city its districts and corridors. Policy 4.3. Require signage to be designed considering the scale and materials of adjacent buildings, the desired character of the neighborhood, district, or corridor where the site is located, and pedestrian orientation. Policy 9.3. Promote business development that can support the city’s property tax base, generate business-to-business sales taxes, and enhance Azusa’s economic health and quality of life. Policy 10.2. Promote Azusa’s competitiveness at the regional or sub-regional level in key strategic retail niches. There is no specific plan for this property. The project complies with the Development Code with the approval of a variance and a use permit. 2. The proposed agreement would promote installation of a billboard that is compatible with the uses and structures on the site and in the surrounding area, considering the scale and materials of adjacent buildings, the desired character of the neighborhood, district, or corridor where the billboard is located, and pedestrian orientation. Under the Agreement, the billboard is proposed to be located immediately adjacent to the I-210 Billboard Relocation January 3, 2017 Page 8 of 9 freeway. The billboard will also be adjacent to a forthcoming development including a hotel and quick serve restaurant. The billboard will be compatible with these freeway-oriented developments. The billboard itself will be modernized to be aesthetically pleasing and will include a cap identifying the City of Azusa. 3. The proposed agreement authorizes the installation of a billboard that would not create a traffic or safety problem, including problems associated with onsite access circulation or visibility. The Agreement and proposed billboard have been reviewed by the City’s public works and engineering department to ensure that no traffic or safety problems would arise as a result of the billboard placement. No onsite circulation problems are likely because of the small size of the parcel and the location of the billboard at the north-west corner of the new development site. No visibility problems are expected because the billboard will not interfere with any continuous traffic sight lines. 4. The proposed agreement for installation would not interfere with onsite parking or landscaping required by City ordinance or permit. The placement of the billboard under the Agreement does not interfere with landscaping or onsite parking. No landscaping or parking will be affected by the Agreement. 5. The proposed agreement promotes construction of a billboard that would not otherwise result in a threat to the general health, safety and welfare of City residents. The Agreement and proposed billboard have been reviewed by the City’s public works and engineering department to ensure that no health and safety problems would arise as a result of the billboard placement. In addition, the billboard has been placed in an area of the property that is closest to the freeway and is the least obtrusive to adjacent residential property. 6. The proposed billboard, in addition to its aesthetic treatment, provides public benefits that would not otherwise accrue to the public in the absence of its installation. The Agreement provides multiple public benefits that would not exist but for the relocation of the billboard. For example, the Agreement provides for the City to receive both rent and royalty payments in connection with the sign. In addition, the Agreement results in aesthetic improvements with the removal of an existing billboard currently located in the City’s sphere of influence, which will be relocated to the subject property. FISCAL IMPACT: The project involves no cost to the City. In fact, the City will receive a financial benefit as a result of the billboard agreement in the form of monthly rental and royalty payments. The rent to be received is tied to the Consumer Price Index to ensure that these financial benefits retain their value into the future. Billboard Relocation January 3, 2017 Page 9 of 9 Prepared by: Reviewed and Approved: Kurt Christiansen, FAICP Louie F. Lacasella Director of Economic and Community Development Management Analyst Reviewed and Approved: Troy L. Butzlaff, ICMA-CM City Manager Attachments: 1) Resolution No. 2017-C4 2) Drawing of Proposed Billboard 3) Map Showing Proposed Location RESOLUTION NO. 2017-C4 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA CALIFORNIA APPROVING A BILLBOARD RELOCATION AGREEMENT (S-2016-21) TO ALLOW THE RELOCATION OF A DIGITAL BILLBOARD TO 223 S. AZUSA AVENUE, A USE PERMIT (UP-2016-04) TO ALLOW THE DEVELOPMENT OF A FREEWAY- ORIENTED SIGN AT 223 S. AZUSA AVENUE, AND VARIANCE NO. V- 2016-08 TO ALLOW A BILLBOARD TO BE LOCATED LESS THAN 100 FEET FROM RESIDENTIAL DEVELOPMENT WHEREAS, the City Council of the City of Azusa, following notice thereof as required by law, held a public hearing on the application of Net Development Co. with respect to the requested: Billboard Relocation Agreement (S-2016-21) to allow the relocation of a digital billboard to within the City of Azusa; Use Permit (UP-2016-04) to allow the development of a freeway-oriented sign; and Variance (V-2016-08) to allow the relocation of a billboard to a parcel within 66 feet of residential development (collectively the “Project”); and WHEREAS, the Project involves the removal of an existing billboard located at 16721 E. Arrow Highway, which is in the sphere of influence of the City, and the relocation and construction of a digital billboard which shall include a dual sided LED digital billboard sign, associated sign pole, and three static signs for the businesses on the adjacent commercial property located at 223 S. Azusa Avenue, on the southwest corner of Azusa Avenue and the 210 Freeway off-ramp in the City of Azusa, County of Los Angeles, State of California; and WHEREAS, on December 14, 2016, the Planning Commission of the City of Azusa, following notice thereof as required by law, held a public hearing and recommended approval of the Project; and WHEREAS, City staff has determined that the proposed Project is exempt from environmental review under the California Environmental Quality Act (“CEQA) pursuant to State CEQA Guidelines sections 15301, 15303, and 15311, which exempt the operation of existing structures, the construction of limited numbers of small structures, and the construction of accessory structures such as signs, and none of the exceptions to the use of these categorical exemptions apply; and WHEREAS, all persons wishing to testify in connection with the Project were heard and the application was fully studied, discussed and deliberated; and WHEREAS, the City Council has carefully considered all pertinent testimony and the staff report offered in the case as presented at the public hearing. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Azusa does hereby finds, determines and declares as follows: SECTION 1. The City Council hereby finds and determines that the proposed project is exempt from environmental review under the California Environmental Quality Act (“CEQA) pursuant to State CEQA Guidelines sections 15301, 15303, and 15311, which exempt the operation of existing structures, the construction of limited numbers of small structures, and the construction of accessory structures such as signs, and none of the exceptions to the use of these categorical exemptions apply. SECTION 2. Billboard Relocation Agreement. Based on the entire record before the City Council, all written and oral evidence presented to the City Council, the findings made in this Resolution, and in accordance with Section 88.38.085 of the Azusa Municipal Code, the City Council hereby approves Billboard Relocation Agreement (S-2016-21), attached hereto and incorporated herein, and subject to any non-substantive changes made by the City Attorney and City Manager, based on the following findings: 1. The proposed agreement is consistent with the goals, objectives, purposes and provisions of the General Plan, the Development Code and any applicable specific plan. In accordance with the General Plan, the development is in conformance with the following General Plan Policies: Goal 4. Improve the visual appeal of the City. Policy 4.2. Encourage attractive gateway treatments to establish a positive image of the city its districts and corridors. Policy 4.3. Require signage to be designed considering the scale and materials of adjacent buildings, the desired character of the neighborhood, district, or corridor where the site is located, and pedestrian orientation. Policy 9.3. Promote business development that can support the city’s property tax base, generate business-to-business sales taxes, and enhance Azusa’s economic health and quality of life. Policy 10.2. Promote Azusa’s competitiveness at the regional or sub-regional level in key strategic retail niches. There is no specific plan for this property. The project complies with the Development Code with the approval of a variance and a use permit. 2. The proposed agreement would promote installation of a billboard that is compatible with the uses and structures on the site and in the surrounding area, considering the scale and materials of adjacent buildings, the desired character of the neighborhood, district, or corridor where the billboard is located, and pedestrian orientation. Under the Agreement, the billboard is proposed to be located immediately adjacent to the I-210 freeway. The billboard will also be adjacent to a forthcoming development including a hotel and quick serve restaurant. The billboard will be compatible with these freeway-oriented developments. The billboard itself will be modernized to be aesthetically pleasing and will include a cap identifying the City of Azusa. 3. The proposed agreement authorizes the installation of a billboard that would not create a traffic or safety problem, including problems associated with onsite access circulation or visibility. The Agreement and proposed billboard have been reviewed by the City’s public works and engineering department to ensure that no traffic or safety problems would arise as a result of the billboard placement. No onsite circulation problems are likely because of the small size of the parcel and the location of the billboard at the north-west corner of the new development site. No visibility problems are expected because the billboard will not interfere with any continuous traffic sight lines. 4. The proposed agreement for installation would not interfere with onsite parking or landscaping required by City ordinance or permit. The placement of the billboard under the Agreement does not interfere with landscaping or onsite parking. No landscaping or parking will be affected by the Agreement. 5. The proposed agreement does not promote construction of a billboard that would not otherwise result in a threat to the general health, safety and welfare of City residents. The Agreement and proposed billboard have been reviewed by the City’s public works and engineering department to ensure that no health and safety problems would arise as a result of the billboard placement. In addition, 6. The proposed billboard, in addition to its aesthetic treatment, provides public benefits that would not otherwise accrue to the public in the absence of its installation. The Agreement provides multiple public benefits that would not exist but for the relocation of the billboard. For example, the Agreement provides for the City to receive both rent and royalty payments in connection with the sign. In addition, the Agreement results in aesthetic improvements to a billboard currently located in the City’s sphere of influence, which will be relocated to the City. SECTION 3. Use Permit. Based on the entire record before the City Council, all written and oral evidence presented to the City Council, the findings made in this Resolution, and in accordance with Sections 88.51.040 and 88.38.070 (C) of the Azusa Municipal Code, the City Council hereby approves Use Permit UP-2016-04, based on the following findings: Freeway-Oriented Signs (AMC, § 88.38.070 (C)) 1. The proposed freeway sign is no larger or higher than the minimum necessary for reasonable visibility. The proposed freeway sign is 75 feet tall, which is 10 feet shorter than the sign currently in existence on the opposite side of the freeway. In addition, the parcel is located adjacent to and immediately to the south of the freeway on-ramp. The height and size of the sign is necessary for it to remain reasonably visible from the freeway proper. 2. The use or site cannot be adequately identified by other signs allowed within the applicable zoning district. The parcel on which the sign is to be located is adjacent to the I-210 freeway. In order for the use to be adequately identified by potential patrons, a freeway-oriented sign is required. As noted above, the size and height of the sign are designed to provide reasonable visibility from the I-210 freeway. General Use Permit Findings (AMC, § 88.51.040) 1. The proposed use is allowed within the applicable zoning district and complies with all other applicable provisions of this Development Code and the Municipal Code. The proposed relocation of a billboard is permitted under the City’s Billboard Relocation Ordinance (Azusa Municipal Code, Section 88.38.085) with the approval of a Use Permit. 2. The proposed use is consistent with the General Plan and any applicable specific plan. In accordance with the General Plan, the development is in conformance with the following General Plan Policies: Goal 4. Improve the visual appeal of the City. Policy 4.2. Encourage attractive gateway treatments to establish a positive image of the city its districts and corridors. Policy 4.3. Require signage to be designed considering the scale and materials of adjacent buildings, the desired character of the neighborhood, district, or corridor where the site is located, and pedestrian orientation. Policy 9.3. Promote business development that can support the city’s property tax base, generate business-to-business sales taxes, and enhance Azusa’s economic health and quality of life. Policy 10.2. Promote Azusa’s competitiveness at the regional or sub-regional level in key strategic retail niches. 3. The design, location, size, and operating characteristics of the proposed activity are compatible with the existing and future land uses in the vicinity. The location and size of the billboard are consistent with the use of the site for a future hotel and quick serve restaurant as they are all appropriate uses for freeway-adjacent properties in the Corridor South Azusa Avenue zone. The proposed billboard relocation agreement provides terms designed to protect the interests of the City and nearby residents by assuring that the billboard is modernized so that it is aesthetically pleasing. 4. The site is physically suitable for the type, density and intensity of use being proposed, including access, utilities, and the absence of physical constraints. The site is physically suitable for the relocation of a billboard. The site is immediately adjacent to the I-210 freeway and to appropriate nearby uses including a future hotel and quick serve restaurant. 5. Granting the permit would not be detrimental to the public interest, health, safety, convenience, or welfare, or materially injurious to persons, property, or improvements in the vicinity and zoning district in which the property is located. Granting the permit will not be detrimental to the public interest, health, safety, convenience, or welfare because the billboard will be located immediately adjacent to the freeway and will only be constructed subject to the terms of the billboard relocation agreement, which adequately protects the City and its residents. The proposed use will also be consistent with the operational standards of the City of Azusa Development Code. SECTION 4. Variance. Based on the entire record before the City Council, all written and oral evidence presented to the City Council, the findings made in this Resolution, and in accordance with Section 88.51.050 of the Azusa Development Code, the City Council hereby approves Variance No. V-2016-08 based on the following findings: 1. There are special circumstances applicable to the property, including size, shape, topography, or surroundings, so that the strict application of this Development Code, deprives the property of privileges enjoyed by other property in the vicinity and within the same zoning district. The project site is a small parcel located adjacent to the I-210 freeway. There are no similar parcels in the City of Azusa that would be appropriate for the location of the billboard. A billboard is an appropriate use for this parcel. Because of the size and location of the parcel, it will likely be difficult to develop absent a variance. For example, although the parcel is associated with an Azusa Avenue address, it abuts the freeway on-ramp and San Gabriel Place. At that location, San Gabriel Place is predominantly residential. A residential property would not be possible for the parcel. 2. The approval of the Variance includes condition of approval as necessary to ensure that the adjustment granted does not constitute a grant of special privileges inconsistent with the limitations upon other properties in the vicinity and within the same zoning district. The variance is required as a result of the billboard relocation process. The City’s Billboard Relocation Ordinance has been designed carefully to ensure that billboard location is not a special privilege. The billboard relocation agreement proposed for approval simultaneously with this variance provides multiple protections for the City and its residents including among others advertising restrictions and requirements for the approval by the City of the construction activities. 3. The Variance is consistent with the General Plan, and any applicable specific plan. In accordance with the General Plan, the development is in conformance with the following General Plan Policies: Goal 4. Improve the visual appeal of the City. Policy 4.2. Encourage attractive gateway treatments to establish a positive image of the city its districts and corridors. Policy 4.3. Require signage to be designed considering the scale and materials of adjacent buildings, the desired character of the neighborhood, district, or corridor where the site is located, and pedestrian orientation. Policy 9.3. Promote business development that can support the city’s property tax base, generate business-to-business sales taxes, and enhance Azusa’s economic health and quality of life. Policy 10.2. Promote Azusa’s competitiveness at the regional or sub-regional level in key strategic retail niches. There is no specific plan for this property. SECTION 5. Effective Date. This Resolution shall take effect immediately upon adoption. PASSED, APPROVED and ADOPTED this 3 day of January, 2017. ___________________________________ Joseph Romero Rocha Mayor ATTEST: ___________________________________ Jeffrey Lawrence Cornejo, Jr. City Clerk APPROVED AS TO FORM ___________________________________ Marco A. Martinez City Attorney STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF AZUSA ) I HEREBY CERTIFY that the foregoing Resolution No. 2017-C4 was duly adopted by the City Council of the City of Azusa at a regular (or special) meeting thereof, held on the 3rd day of January, 2017, by the following vote of Council: AYES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: ___________________________________ Jeffrey Lawrence Cornejo, Jr., City Clerk APPROVED AS TO FORM: ___________________________________ Best Best & Krieger, LLP City Attorney EXHIBIT A BILLBOARD RELOCATION AGREEMENT [ATTACHED BEHIND THIS PAGE] 45635.01000\29349188.4 [DRAFT NO. 1] SIGN PARCEL GROUND LEASE AND BILLBOARD RELOCATION AGREEMENT AMONG THE CITY OF AZUSA, a California municipal corporation AND SIGN ONE LP a California limited partnership AND LAMAR CENTRAL OUTDOOR, LLC, a Delaware limited lability company, registered and authorized to do business in the State of California Dated as of November ___, 2016 for reference purposes only Error! Unknown document property name./017604-0065 Error! Unknown document property name..Error! Unknown document property name. a12/10/16 45635.01000\29349188.4 SIGN PARCEL GROUND LEASE AND BILLBOARD RELOCATION AGREEMENT THIS SIGN PARCEL GROUND LEASE AND BILLBOARD RELOCATION AGREEMENT ("Agreement") is made and entered into this ______ day of ____________, 2016 (the “Effective Date”), by and between SIGN ONE LP, a California limited partnership (“Landlord”), the CITY OF AZUSA, a public body, corporate and politic (“City”) and LAMAR CENTRAL OUTDOOR, LLC, a Delaware limited lability company, registered and authorized to do business in the State of California ("Tenant"). City, Tenant and Landlord are sometimes hereinafter referred to individually as “party” and collectively as the “parties.” RECITALS A. City has, consistent with the California Outdoor Advertising Act (California Business & Professions Code, Section 5200 et seq.), adopted certain regulations concerning outdoor advertising displays ("Billboards"), including a complete prohibition on new Billboards; and B. The California Outdoor Advertising Act generally provides that compensation must be paid to Billboard owners for the removal, abatement or limitation of the customary maintenance, use or repair of certain lawfully erected Billboards; and C. The California Outdoor Advertising Act also contains language providing that "[I]t is the policy of the State of California to encourage local entities to continue development in a planned manner without expenditure of public funds while allowing the continued maintenance or private investment and a medium of public communication." As a result, "...local entities are specifically empowered to enter into relocation agreements on whatever terms are agreeable to the display owner and the city ... and the adopt ordinances and resolutions providing for relocation of displays." D. Company maintains certain existing Billboards within the City of Azusa, the Azusa sphere of influence and along the I-215 Freeway that were lawfully erected and have been removed or will be removed as a condition of this Agreement; and E. Landlord is the owner of certain real property located in the vicinity of the southwest corner of the 210 Freeway and Azusa Avenue, in Azusa, California, designated by the Los Angeles County Assessor's Office as Assessor Parcel No 8614-014-920 (portion), which Landlord desires to lease to Tenant as fully described in Exhibit A ("Premises"). F. Tenant desires to relocate, install, operate, maintain and repair a digital billboard advertising structure and related equipment ("Digital Billboard") in the described Premises and to construct certain improvements within the Premises, depicted in the Exhibits B-1 Elevations and B-2 Conduit Area, respectively. G. As a condition of the construction of the Digital Billboard on the described Premises, Tenant agrees to remove an existing billboard located within the City of Azusa Sphere of Influence at 16721 E. Arrow Highway without further compensation. 45635.01000\29349188.4 -3- H. Landlord is willing to grant Tenant a Lease to use the Premises for the purposes stated subject to the requirements of this Agreement and subject to the guarantee of this agreement by Tenant’s parent corporation, which is attached hereto as Exhibit C. I. City is willing to consider approval of the entitlements upon the terms represented in this Agreement and in accordance with the City’s Municipal Code. NOW, THEREFORE, In consideration of the mutual covenants and promises in this Agreement, the Parties agree as follows: 1. FUNDAMENTAL LEASE PROVISIONS. In the event of any conflict between the following Fundamental Lease Provision and the balance of this Lease, the latter shall control. 1.1 Project: The term “Project” refers to the removal of an existing Billboard located at 16721 E. Arrow Highway without any further compensation and the relocation and construction of a Digital Billboard which shall include a dual sided LED Digital Billboard sign, associated sign pole, and three (3) static signs for the businesses on the adjacent commercial property located on the southwest corner of Azusa Avenue and the 210 Freeway off-ramp in the City of Azusa, County of Los Angeles, State of California. The adjacent property is anticipated to have a hotel development, a quick serve restaurant (initially McDonald’s) and potential excess property (the “Adjacent Project”). 1.2 Improvements: The “Improvements” as used in this Lease means the dual sided Digital Billboard, the associated sign pole, static sign panels for three (3) parties associated with the Project (the “Static Signs”), including parcels annexed into the Project by the owner of the Project and all utility installations or other improvements associated therewith as described in Section 6.1 below (collectively the “Improvements”), and all other improvements constructed on the Premises from time to time, and any replacement, rehabilitation, remodeling or addition thereto. Tenant will have access to and may locate one Digital Billboard and all supporting equipment enclosures used solely in connection with the Digital Billboard within the Premises. Tenant will have access to and may locate conduit and cable to provide electrical service and coaxial cabling to the Digital Billboard, as described in Exhibit B-2 of this Agreement or as otherwise approved by the Landlord. 1.3 Term: Twenty (20) years. (See Section 4.) This Agreement shall be effective upon execution by all Parties ("Effective Date") and the approval by City of all applicable permits for the construction of the Digital Billboard. Landlord and Tenant agree and understand that the Digital Billboard may be subject to certain discretionary and environmental approvals issued by the Azusa Planning Commission and/or the City Council ("Reviewing Entities"). Nothing contained herein shall be interpreted to require any of these entities to approve the Digital Billboard. As a result, the effective date of this Agreement and the commencement of the Term are specifically contingent upon completion of the aforementioned actions. The Term shall commence in accordance with Section 4.2 below. 1.4 Base Monthly Rent: ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000.00) per year payable in equal monthly installments of TWELVE-THOUSAND FIVE HUNDRED DOLLARS ($12,500.00). One-half of such amount or SEVENTY-FIVE THOUSAND DOLLARS ($75,000.00) payable in equal monthly installments of SIX-THOUSAND TWO HUNDRED FIFTY DOLLARS ($6,250.00) shall be payable to City and one-half of such amount or SEVENTY-FIVE THOUSAND DOLLARS ($75,000.00) payable in equal monthly installments of SIX-THOUSAND TWO HUNDRED FIFTY DOLLARS ($6,250.00) shall be payable to Landlord (See Section 4.) 45635.01000\29349188.4 -4- 1.5 Use of Premises: The business conducted on the Premises shall be that of the operation of the Digital Billboard and the Improvements and for no other use or purpose (See Section 3.) 1.6 Address for Notices: Landlord: Sign One LP 3130 Airway Avenue Costa Mesa, CA 92626 Attn: Kevin Coleman City: The City of Azusa 213 E. Foothill Blvd. Azusa, CA 91702 Attn: City Manager Tenant: Lamar Central Outdoor _________________ _________________ Attn: _____________ 2. EXHIBITS. The following drawings and special exhibits are attached hereto and made a part of this Lease: EXHIBIT “A” — Legal Description of Premises/Aerial Map EXHIBIT “B-1” — Elevations and Site Plan EXHIBIT “B-2” — Conduit Area EXHIBIT “C” — Corporate Parent Guarantee 3. USE. The Landlord hereby leases to Tenant and Tenant hereby hires from Landlord the Premises with appurtenances as defined herein, for the purpose of conducting thereon only the use specified in Section 1.5 of this Lease and no other use or purpose. Tenant shall not modify its use from the foregoing use without Landlord’s and City’s prior written consent, which may be withheld in Landlord and City’s sole discretion. Tenant shall not commit, or suffer to be committed, any waste upon the P remises, or any nuisance. Tenant’s rights under this Agreement are subject to all covenants, restrictions, easements, agreements, reservations and encumbrances upon, and all other conditions of title to the Premises. Tenant’s rights under this Agreement are subject to all present and future building restrictions, regulations, zoning laws, ordinances, resolutions and orders of any local, state or federal agency, now or hereafter having jurisdiction over the Premises or the Tenant’s use of the Premises. Tenant may use the Premises only for constructing, installing, operating, maintaining, and repairing the Improvements and no other use. Tenant must at all times comply with all federal, state and local laws, ordinances, rules and regulations which are applicable to its operations and the Premises, including all laws, ordinances, rules and regulations adopted after the Effective Date. Tenant must display to the City and Landlord, upon request, any permits, licenses or other evidence of compliance with all laws. Except for the Digital Billboard and the Static Signs, Tenant shall not install any signs in the Premises other than required safety warning signs or any other signs as are requested or approved by the City, and Tenant bears all costs pertaining to the erection, installation, maintenance, and removal of all signs. Tenant must at all times use its commercially reasonable best efforts to minimize any impact that its use of the Premises 45635.01000\29349188.4 -5- will have on uses of the Adjacent Project. Tenant will not install, operate or allow its agents, employees, or contractors to use any equipment, methodology or technology that may interfere with the optimum effective use or operation of the City's fire, emergency or other communication equipment, methodology or technology (e.g., voice or other data receiving and/or transmitting equipment) that is presently in use or may be in use in the future. If such interference does occur, the Tenant must immediately discontinue using the equipment, methodology or technology that causes the interference until corrective measures are taken which must be made at no cost to the City. Tenant and City will use their best reasonable efforts to resolve immediately any interference problems, but if an interference problem is unavoidable, the City's right to use the City's fire, emergency, or other communication equipment remains paramount to any use of the Premises by the Tenant and Tenant has the right to terminate this Agreement without penalty and without any cost to the City. Tenant, at its own expense, will use commercially reasonable efforts to minimize the collateral visual and aesthetic impacts of the Digital Billboard, which will include, but not be limited to, replacing existing equipment with smaller equipment, decreasing the area used to house supporting equipment, or decreasing the size of any wireless communications equipment. Tenant must, at its own cost, obtain and maintain in full force and effect during the term of this Agreement all licenses and permits required for all activities authorized by this Agreement. Tenant must at all times have on-call an active, qualified, and experienced representative to supervise the Digital Billboard, and who is authorized to act for the Tenant in matters pertaining to all emergencies and the day-to-day operation of the Digital Billboard. Tenant will provide the Landlord and City with the names, addresses, and 24-hour telephone numbers of all such persons in writing. 3.1 ADVERTISING RESTRICTIONS. Tenant covenants to Landlord that the advertising displayed on the Digital Billboard shall not contain advertising for tobacco or tobacco related products, adult entertainment or nudity including, but not limited to topless bars, nightclubs, establishments that feature nude dancing, mud wrestling, any adult business featuring retail sales of adult novelty items, books, magazines, videos, DVD’s or tapes or any material that could reasonably be considered pornographic. Additionally, Tenant covenants to Landlord that advertising displayed on the Digital Billboard shall not contain advertising for hotels and/or motels located outside of the City within a five (5) mile radius of the boundaries of the City. Landlord further reserve the right to object to and prohibit any other advertising that may be considered detrimental to the image of the City or the Adjacent Project. In such case, Landlord shall inform Tenant in writing of the offensive advertising and request that it be removed. Tenant shall cooperate with Landlord in assuring the removal of such other advertising when such removal does not beach any existing contract or lease agreement held by Tenant. 4. TERM. 4.1 Delivery of Possession. Landlord shall deliver exclusive possession of the Premises to the Tenant upon the execution and delivery of this Lease in its AS-IS condition free and clear of all prior leases, tenants and/or occupants. Except as expressly set forth in this Lease, Landlord makes no representation or warranty with regard to the Premises, including without limitation, its condition or fitness for Tenant’s use, and Tenant hereby waives any implied representation or warranty. Tenant has non-exclusive right for ingress and egress, seven days a week, 24 hours a day, for the construction, installation and maintenance of the Digital Billboard, which right will be exercised so as to not unreasonably interfere with Landlord’s operations or use of the Adjacent Project. Tenant warrants that it has studied and inspected the Premises, obtained any information and professional advice as the Tenant has determined to be necessary related to this Agreement, and therefore accepts the same "AS IS" without any express or implied warranties of any kind, and specifically acknowledges that neither City nor Landlord has made any warranties or representations as to its condition or fitness for any use and any warranties or representations about future uses that may impact the Digital Billboard, including, but not limited to, 45635.01000\29349188.4 -6- view obstructions. The parties do not by this instrument intend to create other real property interests or vest with Tenant any real property interest in the Premises and nothing express or implied in this Agreement grants Tenant any right or authority to enter, occupy, or use any property that is not solely owned by the Landlord and fully described herein. The description of the Premises is for this Agreement only and is not intended to circumvent the Subdivision Map Act and shall not be used for sale, lease or finance purposes. 4.2 Term. The term of this Lease (the “Term”) shall be as specified in Section 1.3 hereof or until this Lease is earlier terminated as provided herein. The Term of this Lease shall commence (“Commencement Date”) on the date on which Tenant commences advertising on the Digital Billboard (“Commencement Date”) . Tenant shall inform City and Landlord in writing of the official Commencement Date. In the event that the Commencement Date does not occur on the first (1st) day of a calendar month, the Term of this Lease shall be extended by the number of days of the partial month at the commencement of the Term such that the Lease shall end on the last day of a calendar month (“Termination Date”). All other Tenant’s obligations under this Lease, except the payment of Base Rent and additional rental (which shall commence on the Commencement Date), shall commence upon the date of delivery of possession of the Premises to Tenant. In the event the Commencement Date has not occurred on or before _________, City or Landlord shall each have the right to terminate this Lease upon thirty (30) days advance notice, to be given prior to the commencement hereunder. 4.3 Extended Term. Tenant is given the option to extend the Term on all the provisions contained in this lease, except for Base Rent, for two (2), five (5) year periods (“Extended Term”) following expiration of the initial term or any Extended Term by giving notice of exercise of the option (“Option Notice”) to Landlord at least six (6) months before the expiration of the Term or the Extended Term. Notwithstanding the foregoing, if Tenant is in default beyond the designated cure period on the date of giving the Option Notice, the Option Notice shall be totally ineffective, or if Tenant is in default beyond the designated cure period on the date the Extended Term is to commence, then at Landlord’s option the Extended Term shall not commence and this Lease shall expire at the end of t he initial Term or the first Extended Term. Base Rent shall be adjusted at the beginning of any Extended Term and every five (5) years thereafter pursuant to Section 5.2 below. 4.4 Termination. (a) Tenant For Cause. Tenant may terminate this Agreement in the event of any of the following: (1) Applications for Governmental Approval are rejected; (2) Governmental Approval issued to Tenant by the City is canceled, expires, lapses, or is otherwise withdrawn or terminated by governmental authority, (3) Tenant reasonably determines that any soil boring tests are unsatisfactory; (4) Prior to initial construction of the Digital Billboard, Tenant reasonably determines that the Premises is no longer technically compatible for its use, (5) Prior to initial construction of the Digital Billboard, Tenant reasonably determines that it will be unable to use the Premises for its intended purposes. 45635.01000\29349188.4 -7- (6) Issuance by a court of competent jurisdiction of an injunction in any way preventing or restraining the Tenant’s use of any portion of the Premises and the injunction remaining in force for a period of 30 consecutive days. (7) The inability of the Tenant to use any substantial portion of the Premises for a period of 90 consecutive days due to the enactment or enforcement of any law or regulation or because of fire, earthquake or similar casualty or Acts of God or the public enemy. No Base Rent shall be due during the period of non-use and Base Rent shall be discounted on a pro-rata basis for the number of days of non-use (8) If the Premises or Digital Billboard is destroyed or damaged in either party's reasonable judgment to substantially and adversely affect the use of the Digital Billboard. (b) Landlord for Cause. The Landlord may terminate this Agreement and seek damages by giving Tenant 30 days' written notice after the happening of any of the following events. (1) The failure of Tenant to perform any of its obligations under this Agreement and such failure is not cured fully within the 30 days' notice period or, if the cure cannot reasonably be completed within the 30 days' notice period, then within 90 days from the date of the original notice; provided that Tenant must initiate the cure within the original 30 days' notice period and thereafter diligently pursue the cure; (2) The taking of possession for a period of 90 days or more of substantially all of the personal property used in the Premises belonging to the Tenant by or pursuant to final lawful authority of any legislative act, resolution, rule, order or decree or any act, resolution, rule, order or decree of any court or governmental board, agency, officer, receiver, trustee or liquidator, or (3) The filing of any lien against the Premises because of any act or omission of the Tenant that is not discharged or fully bonded within 30 days of receipt of actual notice by the Tenant. (c) The Landlord may terminate this Agreement and seek any other remedy allowed by law or equity by giving the Tenant 15 days' written notice of the Tenant’s failure to timely pay rent or any other charges required to be paid by the Tenant pursuant to this Agreement in addition to Landlord’s rights under Section 17 below. (d) The Landlord may terminate this Agreement if the Tenant at any time and for any reason fails to maintain all insurance coverage required by this Agreement, immediately terminate this Agreement or alternatively and at it sole discretion, secure the required insurance at Tenant’s expense, which will be immediately due and payable. (e) Upon termination, Tenant will immediately pay to the City and Landlord any due and unpaid Base Rent and any Royalty Payments. (f) Upon the termination of this Agreement for any reason, all rights of the Tenant terminate, including all rights of the Tenant’s creditors, trustees and assigns, and all others similarly situated as to the Premises. 45635.01000\29349188.4 -8- 5. RENTAL. 5.1 Base Rent Tenant shall pay to Landlord and City, during the Term of this Lease from and after the Commencement Date as base monthly rent (“Base Rent”) for the Premises the sum specified in Section 1.4 hereof, which sum shall be paid in advance on the first (1st) day of each calendar month. Tenant shall pay the initial monthly rent on or before the Commencement Date (prorated for any partial month). In the event the Commencement Date does not occur on the first (1st) day of a calendar month, the Base Rent for the initial fractional month shall be prorated as of the Commencement Date on a per diem basis (calculated on the basis of a thirty (30) day month). All rental to be paid by Tenant to Landlord and City shall be in lawful money of the United States of America and shall be paid without deduction or offset, prior notice or demand at the address designated in Section 1.6 hereof. 5.2 Cost of Living Adjustment. Upon the fifth (5th) anniversary of the Commencement Date, or if the Commencement Date is not on the first (1st) day of a month, then on the first (1st) day of the next calendar month, and every five (5) years thereafter, the Base Rent shall be increased by a percentage equal to the percentage increase from the "Base Period" of the United States Department of Labor, Bureau of Labor Statistics, Consumer Price Index, All Urban Consumers (All Items) for the Los Angeles-Riverside-Orange County Metropolitan Area (1982-1984 = 100). Said Consumer Price Index (the "CPI") for October 2016 shall be considered the "Base Period." Said adjustment shall be made by comparing the CPI for the Base Period to the CPI for the month of May preceding each such Adjustment Date. If at any time there shall not exist the CPI, Landlord, City and Tenant shall substitute a comparable official index published by the Bureau of Labor Statistics, or successor or similar governmental agency. This adjustment shall also apply at the commencement of any Extended Term. 5.3 Net Lease. It is the intention of the Landlord, City and Tenant that the rent herein specified shall be net to the Landlord and City, and that all costs, expenses and obligations of every kind relating to the Premises or the use, operation, management or occupancy thereof, whether or not now cu stomary or within the contemplation of the parties hereto, which may arise or become due during the term of this Lease, shall be paid by the Tenant. Such amounts are considered additional rental hereunder. 5.4 Real Estate Taxes. Following the Commencement Date, in addition to all rentals herein reserved, Tenant shall pay to Landlord annual real estate taxes and assessments levied upon the Premises, which shall be prorated for any such real estate tax for the year in which this Lease commences or ends. Until such time as the Premises is separately assessed, Landlord shall estimate the amount of real estate taxes next due and Tenant shall pay, on a monthly basis, together with Base Rent as additional rental, the amount of Tenant’s estimated tax obligation, subject to reconciliation upon receipt of the actual tax bill. The term “real estate taxes” as used herein shall be deemed to mean all taxes assessed or levied against or imposed on the Premises and the Improvements as well as taxes and assessments of every kind and nature (including any tax on rent which is substituted in whole or in part for, or is in addition to, real property taxes or assessments, and any license fee imposed by a local governmental body on the collection of rent, but excluding federal and state income taxes) levied and assessed in lieu of, in substitution for, or in addition to, existing real property taxes, whether or not now customary or within the contemplation of Landlord, City and Tenant. Tenant must pay any leasehold tax, possessory-interest tax, sales tax, personal property tax, transaction privilege tax or other exaction assessed or assessable as a result of its occupancy of the Premises under authority of this Agreement. If any law or judicial decision results in the imposition of a real property tax on the interest, the tax must also be paid by the Tenant on a proportional basis for the period this Agreement is in effect. “Real estate taxes” shall not include personal income taxes, inheritance taxes, or franchise taxes levied against the Landlord and City but not directly against such property, unless such taxes are in lieu of or in substitution for taxes levied 45635.01000\29349188.4 -9- directly against such property. The term “real estate taxes” shall also include all ad valorem and possessory interest taxes. 5.5 Royalty Payments. (a) Amount. In addition to Base Rent, Tenant shall pay to Landlord and City, as “Royalty Payments”, the amount, if any, by which twenty-five percent (25%) of Sign Income (defined below) made in or from the Premises during each calendar year of the Lease Term, exceeds the aggregate amount of the Base Rent payable by Tenant for such year. One-half (1/2) of such amount shall be payable to City and one-half (1/2) of such amount shall be payable to Landlord. The term “Sign Income” is defined as the entire gross receipts or compensation of every kind and nature generated from the Premises by Tenant or any affiliate of Tenant during the Lease Term. Within fifteen (15) days after the end of each calendar month of the Lease Term, Tenant shall furnish Landlord and City with a written statement, certified by Tenant to be correct, showing the total Sign Income made from the Premises during the preceding calendar month. In the event the Sign Income is not a variable payment (such as it being payable as base rent or similar amounts in Tenant’s sublease with the sign company operating the Digital Billboard, Tenant may provide updated statements at such time as the Sign Income is adjusted, rather than monthly). Within thirty (30) days after the close of each calendar year, Tenant shall furnish Landlord and City with a written statement, certified by Tenant to be correct, of Sign Income during said calendar year and shall accompany each annual statement with a payment of the Royalty Payments due for such calendar year. (b) Books and Records. Tenant shall keep full and accurate books of account, records, cash receipts and other pertinent data showing the Sign Income. Such books of account, records, cash receipts and other data shall be kept for a period of at least two (2) years after the end of the calendar year to which they relate. The receipt by Landlord and City of any statement or payment of Royalty Payments for any period shall not bind Landlord and City as to the correctness of the statement or the payment. (c) Inspection and Audit. Landlord and City, upon 15 days' notice, shall be entitled to inspect, examine and/or audit all of the books of account, records, cash receipts and other pertinent data of Tenant, and Tenant’s subleases, to the extent Landlord and City deems necessary in order to verify the amount of Sign Income from the Premises. Tenant shall cooperate fully with Landlord and City in making the inspection, examination or audit. The inspection and audit shall be conducted at Tenant’s principal offices during usual business hours on reasonable prior notice to Tenant, and Tenant shall be required to make available at such place and time all required sales records. Landlord and City shall pay its costs of the inspection or audit unless the inspection or audit shows that Tenant understated the Sign Income in any calendar year by more than two percent (2%), in which case Tenant shall pay all Landlord and City’s costs of the inspection or audit as additional rent upon demand. (d) Royalty Fees. For its right to use the Premises, the Tenant must pay, without notice and free from all claims, deductions and setoffs the fees and royalties reflected in Exhibit “E” attached hereto as part of this Agreement. At the time the Royalty Payment is due, Tenant must submit independently verified revenue reports prepared and certified by an independent, Leased Certified Public Accountant (CPA), attesting to the accuracy of the total revenue collections reported during the royalty period and any adjustments reported. In the event the independent verification is not submitted with the Royalty Payment, Tenant shall pay a 5% late fee for each 45635.01000\29349188.4 -10- month or portion of month until the independent verification is submitted If the independent verification is not submitted within 90 days of the due date, the City and/or Landlord reserve the right to hire an independent CPA to conduct the work on behalf of the City/Landlord at Tenant’s expense. Failure to pay for the cost of the independent review within 30 days of receipt of an invoice or failure to pay the 5% late fee within 30 days will result in the Landlord's right to terminate the contract for cause. 6. CONSTRUCTION. Following the Effective Date and prior to the Commencement Date, but in no event later than _________, Tenant shall construct, or cause to be constructed, the Improvements as shown on the elevations and plan attached hereto as Exhibit “B”. Tenant may not make any alterations to the Improvements which affect any of the static signs or sign panels located thereon, including, but not limited to the visibility, height or illumination of the static sign panels, or construct new Improvements or alterations to the Improvements, from that shown on the elevations and plan attached hereto as Exhibit “B”, without Landlord and City’s consent, which consent shall not be unreasonably withheld. All Improvements constructed by or under Tenant on the Premises shall be diligently constructed at no cost or expense to Landlord and City in a good and workmanlike manner according to and in conformity with the laws, rules and regulations of all governmental bodies and agencies. Any and all such Improvements shall be owned by Tenant during the Term of this Lease, but shall remain a part of the Premises during the Term and be surrendered therewith at the end of the Term hereof or sooner termination of this Lease, at which time the same shall become a part of the realty and the absolute property of Landlord. The work shall be approved by all appropriate government agencies, and all applicable permits and authorizations shall be obtained before commencement of the work. All work shall be completed with due diligence in compliance with the plans and specifications and working drawings and all applicable laws. Landlord and City shall have the right to approve the plans and specifications for any improvements or alterations that affect the static signs which are a part of the Improvements, including height, location, visibility, illumination and size of the static signs and any other aspect, which approval shall not be unreasonably withheld as provided above. The entire cost and expense of constructing any and all Improvements on the Premises shall be borne and paid by Tenant. The Digital Billboard placed upon the Premises shall be in compliance with all City ordinance and regulations related to the placement of billboard signs. No construction activities related to Digital Billboard placement in the Premises may commence before City approval processes have been completed. Tenant’s ability to use the Premises on an on-going basis is contingent upon its obtaining, after the execution date of this Agreement, all of the required certificates, permits, and other approvals that may be required by any federal, state or local authorities (collectively "Governmental Approvals"), as well as satisfactory soil boring tests, if required by the City’s Building Official, that sufficiently support the Tenant’s intended use of the Premises Tenant shall pay for all boring tests. Prior to any construction upon the Premises, Tenant must obtain all necessary construction perm its and complete all requirements of the permits prior to any use of the Premises. 7. ALTERATIONS AND FIXTURES. All of the terms and provisions of this Section 7 are subject to the terms and provisions of Section 6 above. Tenant shall have the right at any time and from time to time during the Term to make, at its sole cost and expense, such changes and alterations, structural or otherwise, in or to the Improvements as Tenant shall deem necessary or desirable; provided, however, that Tenant shall not have the right to demolish the Improvements except in compliance with Section 6 above or alter the static sign or static sign panels which are a part of the Improvements. Except for (i) grading and excavation in connection with the construction and/or reconstruction of Improvements upon the Premises and/or the maintenance and preservation of the same in compliance with the terms and provisions of this Lease, or (ii) work performed to satisfy the requirements of governmental 45635.01000\29349188.4 -11- authorities and/or utility companies, Tenant shall not grade, excavate, construct underground improvements or remove soils and/or minerals from or otherwise change or modify the land leased by this Lease in such a way as to materially diminish the value of said land. Tenant shall keep all trees and shrubbery on the Premises trimmed and cut in a neat and attractive condition. Tenant may not remove, damage, or alter in any way any improvements or property upon the Premises, whether currently existing or installed in the future, without the Landlord and City's prior written approval. Tenant shall; repair any damage or alteration to the Premises to the same condition that existed before the damage or alteration. 8. MAINTENANCE AND REPAIR. Tenant shall at all times following the delivery of possession of the Premises to Tenant (subject to construction work during the construction of the Improvements), and at Tenant’s sole cost and expense, maintain, keep, repair and replace (as required) t he Improvements and Premises (and all other Improvements located on the Premises) in good condition, order and repair commensurate with the surrounding Project and in compliance with all applicable laws. Landlord and City shall have the right, but no obligation to maintain, repair or replace all or any part of the Improvements and/or Premises (or any Improvements located thereon). Tenant, at its own expense, is responsible for improvements to and maintenance of the Premises and Improvements during the term of this Agreement. 9. COMPLIANCE WITH LAWS. Tenant shall, at Tenant’s sole cost and expense, comply with and faithfully observe, all laws and the requirements of all municipal, state and federal authorities and appropriate departments, commissions, boards and officers thereof now in force or which may hereafter be in force pertaining to the development, construction, use or operation of the Premises (including all Improvements located thereon). Landlord and City hereby notify Tenant that Landlord and City are not aware of any portion of the Premises having undergone inspection by a Certified Access Specialist. 10. INSURANCE. 10.1 Tenant to Provide Casualty Insurance and Liability Insurance. From and after the commencement of construction of the Improvements and continuing during the Term of the Lease, Tenant shall maintain fire and extended coverage insurance in an amount equal to the full actual replacement cost of the Improvements (exclusive of the cost of excavations, foundations and footings), within the classification of “All-Risk”, together with such other insurance, coverages and endorsements as may be required by any governmental agency. Tenant shall provide Landlord and City with certificates for such insurance. During the entire term of this Lease, the Tenant shall, at the Tenant’s sole cost and expense, but for the mutual benefit of Landlord, City and Tenant, maintain Commercial General Liability Insurance against claims for bodily injury, death or property d amage occurring in, upon or about the Premises (including any common area located thereon) with insurance companies licensed to do business in the State of California with a financial strength rating of A - or better and financial size categorization of VIII or better by Best’s Insurance Guide (or comparable future rating). Such liability insurance shall have combined single limits of not less than TWO MILLION DOLLARS ($2,000,000.00) for bodily injury, death, and property damage and may include a commercially reasonable deductible; provided, however, not more often than every five (5) years during the Term Landlord and City may require Tenant to increase the coverage limit of Tenant’s commercial general liability coverage to commercially reasonable levels. All such policies of insurance shall be issued in the name of Tenant for the mutual and joint benefit and protection of the parties, and a Certificate of such policies of insurance shall be delivered to Landlord and City. Landlord and City and any other persons or entities designated by Landlord and City and having an insurable interest in the Premises, shall be added as additional insureds pursuant to such policies. Said insurance shall provide by its terms that coverage is to be primary and 45635.01000\29349188.4 -12- noncontributing with any similar insurance carried by Landlord and City or the additional parties designated by Landlord and City. Such policy shall provide that not less than thirty (30) days written notice shall be given to Landlord and City prior to the cancellation or modification of any such policy, if such undertaking is then generally available in the insurance market. Prior to any entry onto the Premises and at least thirty (30) days prior to the expiration of any insurance policy, Tenant shall provide Landlord and City with a certificate of insurance or other evidence that the insurance required by this Section will be in effect, or will remain in effect, during the next year. In no event shall the limits of any coverage maintained by Tenant pursuant to this paragraph be considered as limiting the liability of Tenant pursuant to this Lease. 10.2 Minimum Insurance Requirements. (a) Workers' Compensation Insurance with Statutory Limits. This policy shall include employer's liability insurance with limits of at least $1,000,000. (b) Commercial General Liability Insurance in the minimum amounts indicated above or such additional amounts as reasonably required by the City, including, but not limited to, Contractual Liability Insurance (specifically concerning the indemnity provisions of any agreement with the City, Products-Completed Operations Hazard, Personal Injury (including bodily injury and death), and Property Damage for liability arising out of your performance of work for the City. (c) Automobile Liability Insurance against claims of Personal Injury (including bodily injury and death) and Property Damage covering all owned, leased, hired and non-owned vehicles used in the performance of services pursuant to an agreement with the City with minimum limits for Bodily Injury and Property Damage Liability equal to the policy limits, but not less than $1,000,000 each occurrence. Coverage shall include 'any auto. (d) Tenant shall provide written notice to the Landlord and City of cancellation of any required insurance policy for any reason. (e) The insurance must also include advertising and contractual liability coverage for the obligation of indemnity assumed in this Agreement, subject to standard policy provisions and exclusions. (f) Tenant must provide appropriate certificates and endorsements of insurance to the Landlord and City for all insurance policies required by this section. (g) As commercially reasonable, Landlord or City's Risk Manager may alter the requirements above or determine additional insurance is necessary for Tenant’s operations. (h) Each insurance policy required above shall provide that coverage shall not be canceled, except with notice to the Landlord and City for any reason other than nonpayment of premium Tenant shall provide written notice to the Landlord and City of cancellation of any required insurance policy for any reason and information concerning replacement insurance as required by the Agreement. (i) Tenant hereby grants to Landlord and City a waiver of any right to subrogation which any insurer of said Tenant may acquire against the Landlord by virtue of the payment of any loss under such insurance. Tenant agrees to make reasonable efforts to obtain any endorsement that may be necessary to effect this waiver of subrogation, but this provision applies regardless of whether or not the Landlord has received a waiver of subrogation endorsement from the insurer. 45635.01000\29349188.4 -13- 11. INDEMNIFICATION. Except to the extent arising by reason of a breach of this Lease by Landlord or City or the negligence or willful misconduct of Landlord or City, its agents, employees or contractors, Tenant agrees that Landlord and City shall not be liable for and waives any right against Landlord and City based upon any damage or liability from any cause occurring within the Premises. Tenant shall indemnify and hold harmless Landlord and City against and from and waives any rights against Landlord and City based upon any and all liens, claims, demands, liabilities and/or obligations arising from any breach or default in the performance of any obligations on Tenant’s part to be performed under the terms of the Lease, or arising from any negligence or willful misconduct of Tenant, its assignees or subtenants, or their respective agents, contractors, employees, or invitees and from and against all costs, attorneys’ fees, expenses and liabilities incurred in or about such claim or any action or proceeding brought thereon; and in case of any action or proceeding brought against Landlord or City, shall defend the same at Tenant’s expense. Tenant’s obligations under this Section 11 shall survive the expiration or termination of this Lease. 11.1 City will in all instances, except for loss, damages or claims resulting from the sole negligence or fault of City, be indemnified by Tenant and Landlord against all losses, damages or claims. City will give the Tenant and Landlord prompt notice of any claim made or suit instituted that may subject the Tenant or Landlord to liability under this section, although timing of such notice will not diminish Tenant’s/Landlord’s duty to indemnify, and the Tenant and Landlord will have the right to compromise and defend the same to the extent of its own interest. 11.2 City and Landlord may, but do not have the duty to, participate in the defense of any claim or litigation with attorneys of the their selection and at their sole cost without relieving the Tenant of any obligations hereunder. 11.3 Tenant’s obligations under this Agreement survive any termination of this Agreement or the Tenant’s activities in the Premises 11.4 No Party is liable to the other, or any of their respective agents, representatives, employees for any lost revenue, lost profits, loss of technology, rights or services, incidental, punitive, indirect, special or consequential damages, loss of data (except as provided herein), or interruption or loss of use of service (except as provided herein), even if advised of the possibility of such damages, whether under theory of contract, tort (including negligence), strict liability or otherwise. 12. FREE FROM LIENS. Tenant shall keep the Premises and the Improvements free from any liens arising out of any work performed, material furnished, or obligation incurred by Tenant. Prior to commencing any construction, Tenant shall provide Landlord and City with a completed Notice of Non- responsibility for execution, filing and posting by Landlord and City. 13. UTILITIES. From and after delivery of possession of the Premises to Tenant, Tenant shall contract directly with the utility companies for any utilities required in connection with the operation of the Improvements. Tenant shall be solely responsible for the maintenance, repair and replacement of utility lines, pipes and other facilities serving the Premises. Landlord and City shall not be liable to Tenant for any interruption of utility services to the Premises except to the extent said interruption is caused by Landlord and City. Tenant shall keep the static panel signs illuminated at night at levels reasonably approved by Landlord and City. 14. RESERVATION; ENTRY AND INSPECTION. Tenant shall permit Landlord and its agents or representatives to enter into and upon the Premises upon reasonable notice at any and all reasonable 45635.01000\29349188.4 -14- times for the purpose of inspecting the same or for the purpose of installing, repairing, repla cing and renewing the static signs and the static panels located thereon, including the lighting of such panels. Landlord may, at all times, enter upon the Premises for any lawful purpose, provided the action does not unreasonably interfere with the Tenant’s use or occupancy of the Premises. Without limiting the generality of the foregoing, Landlord and any furnisher of utilities and other services may, at their own cost: (1) enter upon the Premises at any time to make repairs, replacements or alterations that, in the opinion of the Landlord or the furnisher of utilities and other services, may be necessary or advisable and from time to time to construct or install over, in, or under the Premises systems or parts, and (2) in connection with any maintenance, use the Premises for access to other parts in and around the Premises, provided that in the exercise of these rights of access, repairs, alterations or new construction, the Landlord does not unreasonably interfere with the use and occupancy o f the Premises by the Tenant. The exercise of any of the foregoing rights does not constitute a termination of the Lease, nor serve as the grounds for any abatement of Base Rent, Royalty Payments, or any claim for damages. Landlord shall conduct such activities in a manner that does not adversely impact Tenant’s operations. Landlord reserves the rights to access the Premises and the Improvements pursuant to the Sign Easement in favor of the owners of the Project recorded against the Premises and Tenant acknowledges such sign easement and agrees to comply therewith. Landlord shall have the right to control the static sign. The static sign panels shall only advertise those business entities located on the commercial property adjacent to the Premises. 15. DAMAGE AND DESTRUCTION OF PREMISES. In the event of partial or total destruction of the Improvements during the term of this Lease which requires repairs to the Improvements, Tenant shall , in Tenant’s sole and absolute discretion, either make said repairs or terminate this Lease with no penalty or further obligation to Landlord and City. If Tenant elects not to repair the Improvements in accordance with this paragraph, then at Landlord’s election, Tenant shall either (a) surrender the Improvements to Landlord at the expiration or earlier termination of the Lease, or (b) raze the Improvements and return the land underlying the Improvements to Landlord in a clean, graded condition, with all improvements pertaining to the Improvements and debris removed. If the Lease is terminated pursuant to this Section 15, Tenant shall be relieved of its obligation to pay rent from and after the effective termination date and all rentals shall be prorated among Landlord, City and Tenant as of the effective date of such termination. The Landlord and City have no obligation to reimburse the Tenant for the loss of or damage to fixtures, equipment or other personal property of Tenant, except for such loss or damage as is caused by the negligence or fault of the City, Landlord or their officers, employees or agents. 16. ASSIGNMENT AND SUBLETTING. Tenant shall have the right, without Landlord’s consent, to sublease the Premises or any part thereof to a nationally or regionally recognized sign company in connection with the initial construction of the Digital Billboard. Tenant shall provide Landlord with a copy of any sublease entered into by Tenant. Any other assignment of this Lease or subleasing of the Premises shall first require the consent of Landlord, such consent not to be unreasonably withheld, conditioned or delayed. Any such assignment shall be subject to all of the terms and conditions of this Agreement and lease provisions and the proposed assignee shall assume the obligations under this Lease in writing in form satisfactory to Landlord. Consent by Landlord to one assignment, subletting, occupation or use by another person shall not be deemed to be a consent to any subsequent assignment, subletting, occupation or use by another person. Consent to an assignment shall not release the original named tenant from liability for the continued performance of the terms, covenants and provisions on the part of Tenant to be kept and performed, and the assignment and assumption documents shall so provide. Any assignment or subletting without the prior written consent of Landlord shall be void. Except as provided herein, neither Party may assign this Agreement or any of its rights or obligations 45635.01000\29349188.4 -15- hereunder without the prior written consent of the other Party, which consent will not be unreasonably withheld Any attempted assignment, delegation, or transfer without the necessary consent will be void. Tenant may assign this Agreement, upon 30 days' written notice to the City and Landlord and upon both their written consent, which may not be unreasonably withheld, conditioned or delayed City and/or Landlord may as a condition of consent, require that any assignee submit biographical and financial information at least 30 days prior to any the assignment of Tenant’s interest under this Agreement. Tenant may, upon notice to the City and Landlord, mortgage or grant a security interest in this Agreement and Digital Billboard, and may assign this Agreement and Digital Billboard to any mortgagees, deed of trust beneficiaries or holders of security interests, including their successors or assigns ("Mortgagees"), provided such Mortgagees agree to be bound by the terms of this Agreement In this event, City and Landlord will execute consent to financing as may be reasonably required by Mortgagees In no event will the Tenant grant or attempt to grant a security interest in the real property of the Premises. Landlord shall have the right to assign, pledge or otherwise transfer the rights and obligations of the Landlord under this Agreement, in whole or in part, and the Landlord shall have the right to assign, transfer, convey or encumber any or all portion of the Premises, without the consent of Tenant, so long as the assignee assumes all the rights and obligations of the Landlord under this Agreement. 17. DEFAULT AND REMEDIES. The occurrence of any one or more of the following events shall constitute a default and breach of this Lease by Tenant: (a) the failure to pay any rental or other payment required hereunder to or on behalf of Landlord where such default shall continue for a period of ten (10) days after written notice thereof from Landlord to Tenant; (b) the failure to perform any of Tenant’s agreements or obligations hereunder (exclusive of a default in the payment of money) where such default shall continue for a period of thirty (30) days after written notice thereof from Landlord to Tenant (provided that if the nature of Tenant’s obligation is such that more than thirty (30) days are required for performance, then Tenant shall not be deemed in default if Tenant commences performance within such thirty (30) day period and thereafter diligently prosecutes the same to completion); (c) the making by Tenant of a general assignment for the benefit of creditors; (d) the filing by Tenant of a voluntary petition in bankruptcy or the adjudication of Tenant as a bankrupt; (e) the filing by any creditor of Tenant of an involuntary petition in bankruptcy which is not dismissed within sixty (60) days after filing; or (f) the attachment, execution or other judicial seizure of all or substantially all of the assets of Tenant or Tenant’s leasehold where such an attachment, execution or seizure is not discharged within sixty (60) days. In the event of any such default or breach by Tenant, Landlord may at any time thereafter, without further notice or demand, rectify or cure such default, and any sums reasonably expended by Landlord for such purposes shall be paid by Tenant to Landlord upon demand and as additional rental hereunder. In the event of any such default or breach by Tenant, Landlord shall have the right to continue the Lease in full force and effect and enforce all of its rights and remedies under this Lease, including the right to recover the rental as it becomes due under this Lease in accordance with the provisions of Cali fornia Civil Code Section 1951.4 or other applicable Law, or Landlord shall have the right at any time thereafter to elect to terminate said Lease and Tenant’s right to possession thereunder. Upon such termination, Landlord shall have the right to recover from Tenant California statutory remedies, including without limitation, those set forth in California Civil Code Section 1951.2 . Such efforts as Landlord may make to mitigate the damages caused by Tenant’s breach of this Lease shall not constitute a waiver of Landlord’s right to recover damages against Tenant hereunder, nor shall anything herein contained affect Landlord’s right to indemnification against Tenant for any liability arising prior to the termination of this Lease for personal injuries or property damage. 45635.01000\29349188.4 -16- Notwithstanding any of the foregoing, the breach of this Lease by Tenant, or an abandonment of the Premises by Tenant, shall not constitute a termination of this Lease, or of Tenant’s right of possession hereunder, unless and until Landlord elects to do so in writing, and until such time Landlord shall have the right to enforce all of its rights and remedies under this Lease, including the right to recover rent, and all other payments to be made by Tenant hereunder, as they become due. Failure of Landlord to terminate this Lease shall not prevent Landlord from later terminating this Lease or constitute a waiver of Landlord’s right to do so. The parties hereto agree that acts of maintenance or preservation or efforts to release the Premises, o r the appointment of a receiver upon the initiative of the Landlord to protect its interests under this Lease shall not constitute a termination of Tenant’s right of possession for the purposes of this Section unless accompanied by a written notice from Landlord to Tenant of Landlord’s election to so terminate. Acceptance of rental hereunder shall not be deemed a waiver of any default or a waiver of any of Landlord’s remedies. All of Landlord’s rights and remedies shall be cumulative and not exclusive, and in addition to any rights or remedies expressly set forth herein, Landlord shall have all rights and remedies available to Landlord at law or in equity . 18. LANDLORD’S LIABILITY. Anything in this Lease to the contrary notwithstanding, Tenant agrees that it shall look solely to the estate and property of Landlord in the Premises for the collection, satisfaction or enforcement of any judgment requiring the payment of money, or the performance or non-performance of certain acts by Landlord, in the event of any default or breach by Landlord with respect to any of the terms, covenants and conditions of this Lease to be observed and/or performed by Landlord, and no other assets of the Landlord will be subject to levy, execution or other procedures for the satisfaction of any remedy, judgment or order of Tenant. This provision shall not be construed as creating a lien on the interests of Landlord in and to the Premises. In the event of any sale or other transfer of the Premises by Landlord, Landlord shall be and is hereby entirely freed and relieved of all liability under any and all of its covenants and obligations contained in or derived from this Lease arising out of any act, occurrence or omission occurring after the consummation of such sale or other transfer; and the purchaser or other transferee, at such sale or other transfer or any subsequent sale or other transfer of the Premises, shall be deemed without any further agreement between the parties or their successors in interest or between the parties and any such purchaser, to have assumed and agreed to carry out any and all of the covenants and obligations of the Landlord under this Lease arising after the date of such sale. Notwithstanding any contrary term or provision of this Lease, in no event shall Landlord be liable for any consequential or punitive damages under this Lease. 19. FORCE MAJEURE. If any party hereto shall be delayed or prevented from the performance of any act required hereunder by reason of acts of God, strikes, lockouts, labor troubles, inability to procure materials, restrictive governmental laws or regulations or other cause without fault and beyond the control of the party obligated (financial inability excepted), performance of such act shall be excused for the period of the delay, and the period for the performance of any such act shall be extended for a period equivalent to the period of such delay. 20. SUBORDINATION, ATTORNMENT. This Lease may be made subject and subordinate to any future mortgages or deeds of trust on all or any part of Landlord’s interest in the Premises, provided that the mortgagee or trustee thereunder shall execute, acknowledge, and deliver to Tenant a non-disturbance agreement, on such lender’s commercially reasonable terms. This Lease, at Landlord’s option, shall be subordinate to the lien of any deed of trust subsequently placed upon the Premises, and Tenant agrees to execute a subordination agreement in recordable form satisfactory to mortgagee or beneficiary to 45635.01000\29349188.4 -17- accomplish same. Tenant shall execute and deliver, without cost to Landlord, whatever instruments may be required to effect such subordination, provided it is subject to a non-disturbance agreement. Tenant shall, at the request from Landlord, execute any instruments, leases or other documents that may be required to render Tenant’s interest hereunder prior to the lien of any mortgage or deed of trust. If any mortgagee or beneficiary shall elect to have this Lease be prior to the lien of its mortgage or deed of trust and shall give written notice thereof to Tenant, this Lease shall be deemed to be prior to such mortgage or deed of trust, whether this Lease is dated prior or subsequent to the date of said mortgage or deed of trust or the date of recording thereof. 21. ESTOPPEL CERTIFICATE. If, as a result of a proposed sale, assignment, or hypothecation of the Premises or the land thereunder by Landlord, or at any other time, an estoppel certificate shall be requested of Tenant, Tenant agrees, within ten (10) business days thereafter, to deliver such estoppel certificate in such form as reasonably required by Landlord and addressed to such parties identified by Landlord, certifying the requested information, including, among other things, the dates of commencement and termination of this Lease, the rental currently payable hereunder and the date to which rental has been paid, that this Lease is in full force and effect (if such be the case), and that there are no differences, offsets or defaults of Landlord, or noting such differences, offsets or defaults as actually exist. Tenant shall in the same manner acknowledge and execute any assignment of rights to receive rents as required by any mortgagee of Landlord. 22. CONDEMNATION. If the Premises or any part thereof shall be taken by the exercise of the right of eminent domain, then Tenant shall have the option to terminate this Lease if the taking is of such character as to impair or prevent Tenant from conducting its business substantially as theretofore conducted, provided said election shall be made within ninety (90) days after the receipt of notice of said taking. If Tenant shall not so elect to terminate this Lease, then a just proportion of Rent, additional rent and any other charges due under this Lease shall be abated according to the nature and extent of the taking or damage or destruction until the Premises or what may remain thereof have been put by Landlord in the proper condition for use and occupation by Tenant. If this Lease shall not be so terminated and Tenant shall remain in occupation hereunder then there shall be a permanent reduction of Rent, additional rent and any other charges due under this Lease according to the nature and extent of the deprivation to Tenant of the Premises as previously constituted. All compensation and damages awarded in connection with a total or partial taking of the Premises, including all improvements thereon, shall be allocated as follows: (a) Tenant shall be entitled to that portion of the award attributable to the fair market value of the Improvements, or of the portion taken, valued at the date of the taking and excluding any value of the land, multiplied by a fraction, the numerator of which is the number of months remaining in the term, including any remaining Extended Terms (whether or not exercised) and the denominator of which is 240. (b) Landlord shall be entitled to (i) any remaining portion of the award attributable to the fair market value of the Improvements, and (ii) that portion of the award attributable to the fair mark et value of the land, or of the portion taken, valued at the date of the taking and excluding any value of the Improvements. (c) Each party shall be entitled to receive any interest paid on account of any award payable to such party under subparagraphs (a) and (b) above. Tenant shall also be entitled to separately seek from the condemning authority loss of goodwill, relocation, severance and other compensation under law that does not affect the amount of the awards under subparagraphs (a) and (b) above. 45635.01000\29349188.4 -18- In the event at the time of the taking the leasehold estate of Tenant is mortgaged as security to any mortgagee, any award or portion thereof to which Tenant is entitled shall be subject to the prior claim of such mortgagee. If there is a taking of all of the Premises, this Lease shall terminate as of the date of such taking. If this Lease is terminated in accordance with the provisions of this Section 2 2, such termination shall become effective as of the date physical possession of the condemned portion is t aken. If this Lease is not terminated as provided in this Section 22, Tenant shall, at its sole expense, restore with due diligence the remainder of the Improvements so far as practicable to a complete unit of like quality, character, and condition as that which existed immediately prior to the taking. 23. RELATIONSHIP OF PARTIES. The relationship of the parties hereto is that of Landlord, City and Tenant, and it is expressly understood and agreed that Landlord and City do not in any way or for any purpose become a partner or joint venturer of Tenant in the conduct of Tenant’s business. In addition, City’s role is solely as regulator and permit authority for the Improvements. City shall not be deemed a landlord or sublessee. 24. LANDLORD’S DEFAULT. Landlord shall not be in default unless Landlord fails to perform obligations required of Landlord or City within thirty (30) days after written notice by Tenant to Landlord and to the holder of any first mortgage or deed of trust covering the Premises whose name and address shall have theretofore been furnished to Tenant in writing, specifying wherein Landlord has failed to perform such obligation; provided, however, that if the nature of Landlord’s obligation is such that more than thirty (30) days are required for performance, then Landlord shall not be deemed in default if Landlord commences performance within a thirty (30) day period and thereafter diligently prosecutes the same to completion. In the event of any such default or breach by Landlord pertaining to matters located on the Premises, Tenant may at any time thereafter, without further notice or demand, rectify or cure such default, and any sums reasonably expended by Tenant for such purposes shall be paid by Landlord to Tenant upon demand and as additional rental hereunder. In the event of any such default or breach by Landlord, Tenant shall have such remedies as are available in law or equity, except as otherwise expressly provided in this Lease. 25. HAZARDOUS WASTE AND MATERIALS. Tenant shall not engage in any activity nor allow its permittees or their respective officers, directors, partners, members, employees, agents or contractors for whom the Tenant is responsible to engage in any activity involving the use, transportation, handling, manufacture, emission or disposal of any noxious, toxic, caustic or corrosive fuel or gas or other hazardous substance, toxic waste or other Hazardous Material, other than in accordance with all applicable laws and in connection with the operation of a business permitted by this Lease. Tenant shall comply with all environmental laws applicable to the use, transportation, handling or disposal of hazardous materials on or from the Premises. Tenant shall not violate any environmental law, and shall promptly, at Tenant’s sole cost and expense, take all investigatory and/or remedial action required or ordered by any governmental agency or environmental law for clean-up and removal of any contamination involving any hazardous material use, stored, released, disposed or otherwise located on or from the Premises except those created or caused by Landlord, its employees, agents or contractors. Tenant must not use the Premises in a manner inconsistent with any regulations, permits or approvals issued by the California Department of Health Services. Tenant must defend, indemnify and hold the City and Landlord harmless against any loss or liability incurred by reason of any hazardous waste or toxic substance on or affecting the Premises attributable to or caused in any way by the Tenant, and immediately notify the City and Landlord of any hazardous waste or toxic substance at any time discovered or existing upon the Premises. 45635.01000\29349188.4 -19- 26. NOTICES. Wherever in this Lease it shall be required or permitted that notice and demand be given or served by either party to this Lease to or on the other, such notice or demand shall be given or served in writing. Notices may be sent by personal delivery, overnight mail such as Federal Express or certified mail, postage prepaid, addressed as specified in Section 1.6. Either party may change the address set forth in Section 1.6 by written notice by certified mail to the other. Any notice or demand given by certified mail shall be effective one (1) day subsequent to mailing. All options to extend, if any, shall be delivered by certified mail or by a nationally recognized overnight courier such as Federal Express (with tracking of such delivery) only and shall be effective only if delivered by either of such methods. 27. ATTORNEYS’ FEES. In the event that at any time during the term of this Lease either Landlord , City or Tenant shall institute any action or proceeding against the other relating to the provisions of this Lease, or any default hereunder, the unsuccessful party in such action or proceeding shall reimburse the successful party for reasonable attorneys’ fees and other costs and expenses incurred therein by the successful party, including fees and costs incurred in any appellate proceeding. 28. BROKERS; FINDERS. Neither party has had any dealing with any real estate broker or agent in connection with the negotiation of this Lease, and knows of no real estate broker or agent who is or might be entitled to a commission in connection with this Lease. If a party has dealt with any person or real estate broker with respect to leasing or renting space in the Improvements or the Project, such party shall be solely responsible for the payment of any fee due said person or firm, and shall hold the other free and harmless against any liability with respect thereto, including attorneys’ fees and costs. 29. SURRENDER. Upon the expiration or sooner termination of this Lease, Tenant shall surrender the Premises including, without limitation, any Improvements constructed by or under Tenant then situated upon the Premises that Tenant is not required to remove under Section 7, to Landlord free of trash and debris and in good condition, ordinary wear and tear and damage from causes beyond the reasonable control of Tenant excepted. Upon any such surrender, Tenant agrees to execute, acknowledge and deliver to Landlord, within five (5) days after written demand from Landlord to Tenant, any quitclaim deed or other document required by any reputable title company to remove the cloud of this Lease from the Premises. 30. MISCELLANEOUS. 30.1 Severability. If any provision of this Agreement is declared invalid by a court of competent jurisdiction, the remaining terms remain effective, provided that elimination of the invalid provision does not materially prejudice either party with regard to its respective rights and obligations, in the event of material prejudice, then the adversely affected party may terminate this Agreement. 30.2 Representations. The Landlord represents and warrants to the Tenant that: (a) It has full right, power, and authority to execute this Agreement, (b) The Landlord has good and unencumbered title to the Premises free and clear of any hens or mortgages, except those disclosed to the Tenant that will not interfere with the Tenant’s right to use the Premises; and (c) The Landlord's execution and performance of this Agreement will not violate any laws, ordinances, covenants, mortgages, Leases or other agreements binding on the Landlord. 45635.01000\29349188.4 -20- 30.3 Litigation. This Agreement is governed by the laws of the State of California. If any litigation or arbitration between the City, Landlord and/or the Tenant arises under this Agreement, the successful party(ies) is entitled to recover its reasonable attorney's fees, expert witness fees and other costs incurred in connection with the litigation or arbitration. 30.4 Miscellaneous. This Agreement constitutes the entire agreement between the parties concerning the matters contained herein and supersedes all prior negotiations, understandings and agreements between the parties concerning all related matters. This Agreement will be interpreted, applied and enforced according to the fair meaning of its terms and not be construed strictly in favor of or against either party, regardless of which party may have drafted any of its provisions. No provision of this Agreement may be waived or modified except by a writing signed by the party against whom such waiver or modification is sought to be enforced The terms of this Agreement are binding upon and inure to the benefit of the parties' successors and assigns. 30.5 Indemnification of City. Tenant shall defend, indemnify and hold, City, its officials, officers, and agents free and harmless from any and all claims, liabilities, losses, costs, expenses, damages, injuries to property or persons, including wrongful death, in any manner arising out of or incident to any negligent acts, omissions or willful misconduct of Tenant, its officers and employees, agents, consultants and contractor(s)s arising out of or in connection with this Agreement or the removal, past-removal, construction and installation of the aforementioned Digital Billboard, including without limitation, the payment of all consequential damages, attorneys’ fees and other related costs and expenses. At a minimum, this indemnification provision shall apply to the fullest extent of any warranty or guarantee implied by law or fact, or otherwise given to Tenant by any contractor(s) for the removal, past-removal, construction and installation of the Improvements. In addition, this indemnity provision and any such warranties or guarantees shall not limit any liability under law of such contractor(s). Without limiting the foregoing, this indemnity shall extend to any claims arising because Tenant has failed to properly secure any necessary contracts or permit approvals. 30.6 Waiver of Civil Code Section 1542. As it relates to the removal of an existing Billboard by Tenant as part of this Agreement or any removal of Improvements to accommodate the Digital Billboard by Landlord, it is the intention of the Parties that the releases entered into as part of this Agreement shall be effective as a bar to all actions, causes of action, obligations, costs, expenses, attorneys' fees, damages, losses, claims, liabilities and demands of any character, nature and kind, known or unknown, suspected or unsuspected, to be so barred; in furtherance of which intention the Parties expressly waive any and all right and benefit conferred upon them by the provisions of section 1542 of the California Civil Code, which reads as follows: A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor. 30.7 Authority to Enter Agreement. All Parties have all requisite power and authority to execute, deliver, and perform the Agreement. All Parties warrant that the individuals who have signed this Agreement have the legal power, right, and authority to make this Agreement and bind each respective Party. 30.8 Counterparts. This Agreement may be signed in counterparts, each of which shall constitute an original. 45635.01000\29349188.4 -21- 30.9 Binding Agreement. Subject to any limitation on assignment elsewhere set forth herein, all terms of this Agreement shall be binding upon, inure to the benefit of, and be enforceable by the Parties hereto and their respective legal representatives, successors and assigns. 30.10 Jurisdiction and Venue. The parties hereto agree that the State of California is the proper jurisdiction for litigation of any matters relating to this Lease, and service mailed to the address of tenants set forth herein shall be adequate service for such litigation. The parties further agree that Los Angeles, California, is the proper place for venue as to any such litigation. 30.11 Partial Invalidity. If any term, covenant, condition or provision of this Lease is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of the provisions hereof shall remain in full force and effect and shall in no way be affected, impaired or invalidated thereof. 30.12 Late Payments. Tenant hereby acknowledges that late payment by Tenant to Landlord or City of rental or other sums due hereunder will cause Landlord or City to incur costs not contemplated by this Lease, the exact amount of which is extremely difficult to ascertain. Such costs include, but are not limited to, processing and accounting charges and late charges which may be imposed upon Landlord or City by the terms of any mortgage or deed of trust covering the Premises. Accordingly, any payment of any sum to be paid by Tenant not paid within five (5) days following the due date shall be subject to a five percent (5%) late charge; provided, however, that such late charge shall not be imposed upon the first late payment each calendar year if the late payment is cured within five (5) days after written notice from Landlord or City. 30.13 Holding Over. In the event Tenant continues to occupy the Premises after the expiration or termination of this Agreement, such hold-over does not constitute a renewal or extension of this Agreement, and the Tenant must pay the City and Landlord twice the Base Rent and Royalty Payments (as defined below), with each month fully accruing after the first day of the month regardless of the actual number of days Tenant holds over during the month, plus any Royalty Payments (as defined below) accrued during the hold-over, provided however if the City, Landlord, City and Tenant are in active, written negotiations to renew this Agreement or to enter into a new lease for the premises leased herein, the standard Lease Fee and Royalty Payments shall apply and this Agreement shall become a month -to-month agreement until otherwise terminated. 30.14 Successors in Interest. The covenants herein contained shall, subject to the provisions as to assignment, apply to and bind the heirs, successors, executors, administrators and assigns of all the parties hereto; and all of the parties hereto shall be jointly and severally liable hereunder. 30.15 No Oral Agreements. This Lease covers in full each and every agreement of every kind or nature whatsoever between the parties hereto concerning this Lease, and all preliminary negotiations and agreements of whatsoever kind or nature are merged herein, and there are no oral agreements. Tenant acknowledges that no representations or warranties of any kind or nature not specifically set forth herein have been made by Landlord or City or its agents or representatives and Tenant cannot reasonably rely on any such purported representations. No agreement shall be effective to change, modify, waive, release, discharge, terminate or effect an abandonment of this Lease, in whole or in part, unless such agreement is in writing, refers expressly to this Lease and is signed by the part y against whom enforcement is sought 30.16 Time. Time is of the essence of this Lease. 45635.01000\29349188.4 -22- 30.17 Consistency. Each provision herein shall be interpreted so as to be consistent with every other provision. 30.18 Co-Location. Tenant will use reasonable efforts to cooperate with the Landlord and any third parties with regard to the possible co-location of additional facilities or equipment in the Premises. 30.19 Notices to the City. The Tenant will provide the Landlord and City, without request, copies of any petition or application related to any filing by the Tenant of bankruptcy, receivership or trusteeship and any notices received from regulatory agencies pertaining to the operations of the Digital Billboard. 30.20 City Ad Placements. As consideration for the grant of this Agreement by the City, Tenant must also: (a) Accept and coordinate with City as part of any regular and routine ad placement on the Digital Billboard on-going ad placements by the City for City-related events ("City Placements"): (1) City Placements will consist of one 8-second spot per minute on either side, but not both simultaneously, of the Digital Billboard. (2) Alternatively, City may instead elect to place City Placements for an equivalent amount of time on other digital outdoor advertising structures operated by the Tenant in the Greater Phoenix metropolitan area subject to space availability. (3) City Placements will be at no additional cost to the City and will result in no setoff against Base Rent or Royalty Payments. (b) Broadcast any message on the Digital Billboard the City considers necessary for public safety, and (c) Receive, consider and promptly respond to any City objection to Digital Billboard advertising displayed in the Premises. 45635.01000\29349188.4 -23- IN WITNESS WHEREOF, the parties have duly executed this Lease, together with exhibits referred to herein and attached hereto, as of the date first above written. LANDLORD SIGN ONE LP, a California limited partnership By: Its: ATTEST: ________________________________ CITY CITY OF AZUSA, a public body, corporate and politic ______________________________ Joseph R. Rocha, Mayor ATTEST: ________________________________ City Clerk APPROVED AS TO FORM AND CONTENT: _________________________________ Best, Best & Krieger LLP City Attorney 45635.01000\29349188.4 -24- COMPANY LAMAR CENTRAL OUTDOOR, LLC, a Delaware limited lability company, registered and authorized to do business in the State of California By: _______________________________ President ATTEST: __________________________ a12/10/16 45635.01000\29349188.4 -25- 30654395.2 EXHIBIT “A” LEGAL DESCRIPTION OF PREMISES That certain real property situated in the City of Azusa, County of Los Angeles, State of California, described as follows: THAT REAL PROPERTY SITUATED IN THE CITY OF AZUSA, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, SAID REAL PROPERTY PARCEL “C” OF LOT LINE ADJUSTMENT NO. 2014-03 AS SET FORTH IN THE DOCUMENT ENTITLED “CERTIFICATE OF COMPLIANCE” RECORDED AUGUST 19, 2015 AS INSTRUMENT NO. 20151014971 OF OFFICIAL RECORDS. BEING A PORTION OF LOTS 20 AND 21 OF TRACT NO. 13641, AS RECORDED IN BOOK 328, PAGES 18-19 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF LOS ANGELES COUNTY, SAID REAL PROPERTY BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT THE SOUTHEAST CORNER OF LOT 8 OF SAID TRACT NO. 13426; THENCE WESTERLY ALONG SAID SOUTHERLY LINE NORTH 89°40’30” WEST 10.00 FEET TO A POINT ON THE WESTERLY LINE OF AZUSA AVENUE HAVING A HALF WIDTH OF 50.00 FEET; THENCE CONTINUING ALONG SAID SOUTHERLY LINE NORTH 89°40’30” WEST 165.00 FEET TO THE EASTERLY LINE OF A VACATED ALLEY; THENCE SOUTHERLY ALONG SAID EASTERLY LINE SOUTH 00°21’22” WEST 169.00 FEET TO A POINT ON THE NORTHERLY RIGHT OF WAY OFF PARAMOUNT AVENUE HAVING A HALF WIDTH OF 35.00 FEET; THENCE WESTERLY ALONG SAID NORTHERLY RIGHT OF WAY LINE NORTH 89°40’30” WEST 132.68 FEET TO THE BEGINNING OF A TANGENT CURVE CON CAVING NORTHEASTERLY, HAVING A RADIUS OF 20.00 FEET AND A RADIAL BEARING TO SAID POINT OF NORTH 00°19’30” EAST; THENCE WESTERLY AND NORTHERLY ALONG SAID CURVE A DISTANCE OF 31.43 FEET THROUGH A CENTRAL ANGLE OF 90°01’52” TO A POINT ON THE EASTERLY RIGHT OF WAY LINE OF SAN GABRIEL AVENUE HAVING A HALF WIDTH OF 22.00 FEET; THENCE NORTHERLY ALONG SAID EASTERLY RIGHT OF WAY NORTH 00°21’22” EAST 421.11 FEET, SAID POINT ALSO BEING THE TRUE POINT OF BEGINNING; 45635.01000\29349188.4 EXHIBIT “B-1” ELEVATIONS AND SITE PLAN 45635.01000\29349188.4 EXHIBIT “B-2” CONDUIT AREA 45635.01000\29349188.4 EXHIBIT “C” CORPORATE PARENT GUARANTEE [Please provide.] STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF AZUSA ) I HEREBY CERTIFY that the foregoing Resolution No. 2017-C4 was duly adopted by the City Council of the City of Azusa at a regular meeting thereof, held on the 3rd day of January, 2017, by the following vote of Council: AYES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: ___________________________________ Jeffrey Lawrence Cornejo, Jr., City Clerk APPROVED AS TO FORM: ___________________________________ Best Best & Krieger, LLP City Attorney Vicinity Map Azusa Ave.Azusa Ave.San Gabriel Ave.San Gabriel Ave.2 1 0 O ff- R a m p 2 1 0 O ff- R a m p 70'70' 210 On-Ramp210 On-Ramp ´ 1 inch = 100 feet Path: C:\ArcGIS_Misc Projects 5\Edson I\Billboard Vicinity.mxd Date: 12/12/2016 J.Prado Billboard SignAZUSAAZUSAGeographic Information Systems