Agenda — Indio City Council, July 17, 2024 (part 3 of 12)

Three-Year Agreement between the City of Indio and eSentire for Cybersec... Page 309 of 1671 MSSA #: 00052983
Master Security Services Agreement
City of Indio - 200240708 Page 10 of 10 (2023-11)
IN WITNESS WHEREOF, each of the Parties hereto has caused this Agreement to be executed and delivered by its duly authorized representative as of the date set forth below. eSentire, Inc. City of Indio
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Approved by eSentire Legal
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Initials & Date

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Three-Year Agreement between the City of Indio and eSentire for Cybersec... Page 310 of 1671 MSSA #: 00052983
Order Form #: 00054208
City of Indio - 20240708 Page 1 of 4

ORDER FORM
This “Order Form” is between City of Indio (the “Client”) and eSentire, Inc. (“eSentire”), each a “Party” and together the “Parties” and incorporates by reference and is governed by the Master Security Services Agreement # 00052983 (the "MSSA") between the Parties. Capitalized terms used and not otherwise defined in this Order Form or Service Description(s) have the meaning set forth in the MSSA. The Parties have executed this Order Form on the date of the last signature (the “Effective Date”). “Day” or “Days” means calendar days, unless otherwise specified.

Client acknowledges and agrees to all terms of this Order Form, the MSSA, and the service particulars outlined herein (together, for the purposes of this Order Form, referred to as the “Agreement”).

1. TERM AND TERMINATION.
a. The term of the Services will begin 15 Days from the Effective Date (the “Service Commencement Date”) and will continue for 36 consecutive months (“Initial Term”). b. TERMINATION FOR CONVENIENCE. Client may terminate the Services prior to the end of the first Contract Year by providing 60 Days prior written notice to eSentire via registered mail, overnight courier or email to:
[email protected], provided Client has paid all Fees due during the first Contract Year. This early termination right is available to Client only during the first Contract Year. c. Upon expiration of the Initial Term, the term of this Order Form will automatically terminate, unless the Client provides eSentire with at least 60 Days' written notice prior to the end of the Term of its intention to renew, in which case this Order Form will renew for a period of 12 calendar months (each a "Renewal Term"). The Initial Term and any Renewal Term are collectively referred to in this Order Form as the "Term." d. The date of expiration of any 12 consecutive month period beginning on the Service Commencement Date will be known as a “Contract Year.”

2. SERVICE FEES. All Fees are in USD. Client acknowledges that pricing is based on the Services specified in this Order Form and the attached schedules. Client agrees to execute additional Order Forms to document any material increase to the scope of such Services and acknowledges that additional Fees will apply to any such increases. Additionally, if applicable, Client acknowledges and agrees that additional shipping charges will apply for eSentire Equipment shipped by eSentire to a Client location outside of Canada, United States, United Kingdom or Ireland.

3. RENEWAL TERM PRICING. Upon expiry of the Initial Term, and at each subsequent Renewal Term, eSentire will be entitled to increase the price of the Services. Any such annual increase will not exceed an amount equal to 5%. If a greater increase is required, eSentire will notify Client of same at least 90 Days prior to the commencement of the Renewal Term.

4. PAYMENT TERMS. Fees are exclusive of all Taxes. eSentire will invoice Client for Fees annually in advance and payment is due on receipt.

5. SERVICES. eSentire will provide the following Services at the Fees set forth below:
i. MANAGED DETECTION AND RESPONSE (“MDR”) SERVICES. Client acknowledges and agrees to the MDR Service details and applicable Service Descriptions for the Services ordered pursuant to this Order Form found at:
https://www.esentire.com/legal/documents?Service=MDR (“MDR Link”). MDR Services ordered and associated Fees are listed below:
a. Network Services as described in the MDR Link above, and further detailed below:

Description Quantity Annual Fees
200 Series Sensor 3
Users 20 $20,172.00

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Three-Year Agreement between the City of Indio and eSentire for Cybersec... Page 311 of 1671 MSSA #: 00052983
Order Form #: 00054208
City of Indio - 20240708 Page 2 of 4
b. Log Services – Sumo Logic (formerly esLOG Services) as described in the MDR Link above.

Description Hosting Location Quantity Annual Fees*
Daily Ingestion Rate (esLOG Standard) North America 12 GB/Day1 $26,650.00 Daily Ingestion Rate (esLOG Essentials) North America 3 GB/Day1 $3,770.00 TOTAL $30,420.00 1Should Client’s ingestion usage as a daily average exceed 10% of the daily ingestion quota (measured on an average over one calendar month), notwithstanding any security event (the “Overage”), then Client will either (i) take steps to reduce its usage within 30 Days of such Overage, or (ii) move to the next ingestion level as set out in the below tables to accommodate its usage for the remainder of the Term. *Table 1: Additional Storage Fees for esLOG Standard
Daily Ingestion rate (GB/day) Annual Fees
15 $31,655.00
20 $38,480.00
25 $45,435.00
30 $52,260.00
35 $59,215.00
*Table 2: Additional Storage Fees for esLOG Essentials
Daily Ingestion rate (GB/day) Annual Fees
5 $ 5,330.00
7 $ 6,890.00
9 $ 7,995.00
12 $ 9,555.00
15 $11,050.00

6. SCHEDULES. Schedules A (LOG Services - Sumo Logic PROVISIONS), attached hereto, is hereby incorporated into and made a part of this Order Form.

IN WITNESS WHEREOF, each of the Parties hereto has caused this Order Form to be executed and delivered by its duly authorized representative as of the Effective Date. eSentire, Inc. City of Indio
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Initials and Date

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Three-Year Agreement between the City of Indio and eSentire for Cybersec... Page 312 of 1671 MSSA #: 00052983
Order Form #: 00054208
City of Indio - 20240708 Page 3 of 4

SCHEDULE A
LOG Services - Sumo Logic PROVISIONS
Client agrees (or in the case of Resale, Partner will ensure Client agrees) to the following esLOG provisions. For the purposes of the esLOG Services contemplated herein, the Product Publisher is Sumo Logic, Inc. a) Client will not, directly or indirectly, and will not permit or enable any third party to: (i) input, upload, transmit or otherwise provide to or through the software any information or materials that are unlawful or injurious or contain, transmit or activate any malicious code; (ii) damage, destroy, disrupt, disable, impair, interfere with or otherwise impede in any manner the software, in whole or in part; (iii) access or use the software for purposes of competitive analysis of the esLOG Services, the development, provision or use of a competing software service or product or any other purpose that is to the esLOG Product Publisher’s detriment or commercial disadvantage; or (iv) use the software other than in accordance with the esLOG Services description. b) Client hereby grants to the esLOG Product Publisher: (A) a non-exclusive, royalty-free, worldwide, transferrable, sub-licensable license and right to use, copy, modify, create derivative works of, and disclose data, information or other material provided, uploaded or submitted by Client in the course of receiving the esLOG Services for internal purposes and for purposes of providing the esLOG Services; and (B) a non-exclusive, irrevocable, perpetual, royalty-free, full paid-up, worldwide, transferable, sub-licensable license and right to generate anonymized data for any business purposes (including, without limitation, for purposes of eSentire or its Product Publisher, improving, testing, operating, promoting and marketing products and services). Client shall retain all right, title and interest in and to the any data, information or other material provided, uploaded, or submitted by Client in the course of using the esLOG Services including all intellectual property rights therein. c) Client acknowledges and agrees that the esLOG Product Publisher, may anonymize and use Client’s Anonymized Data, share Anonymized Data with third parties for business and analytic purposes, combine Client’s Anonymized Data with data from other sources to an aggregate dataset, use the resulting information for business and analytic purposes. Anonymized Data means data that has had all Client and Personally Identifiable Information (“PII”) removed. Client’s Anonymized Data will not be disclosed in any manner that would identify Client as the source of the data. The aggregate Anonymized Data will be separated from Client’s data. d) If required, Client will cooperate with esLOG Product Publisher in connection with the performance of the esLOG Services by making available such personnel and information as may be reasonably required and taking such other actions as esLOG Product Publisher may reasonably request. Client will also cooperate with esLOG Product Publisher in establishing a password or other procedures for verifying that only designated employees of Client have access to any administrative functions relating to the esLOG Services. e) Unless otherwise specified by the esLOG Product Publisher, Client will use esLOG Product Publisher’s thencurrent names, marks, logos, and other identifiers for the Services and Software (“Trademarks”) and esLOG Product Publisher designated intellectual property related notices provided that Client will: (a) only use Trademarks in the form and manner, and in accordance with the quality standards and usage guidelines that esLOG Product Publisher specifically prescribes and only in connection with the esLOG Services; and (b) upon termination of this Agreement for any reason, immediately cease all use of the Trademarks. None of Client or any affiliate will (a) otherwise brand the esLOG Services or(b) otherwise use or register (or make any filing with respect to) any trademark, name or other designation relevant to the subject matter of this agreement anywhere in the world, whether during or after the term of this Agreement or (c) contest anywhere in the world the use by or authorized by the esLOG Product Publisher of any trademark, name or other designation relevant to the subject matter of this Agreement or any application or registration therefore, whether during or after the term of this Agreement.

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Three-Year Agreement between the City of Indio and eSentire for Cybersec... Page 313 of 1671 MSSA #: 00052983
Order Form #: 00054208
City of Indio - 20240708 Page 4 of 4
f) Client acknowledges and agrees that the esLOG Services operate on or with or using application programming interfaces (APIs) and/or other services operated or provided by third parties (“Third Party Services”). For purposes of clarification, these Third Party Services include applications and the like that are not incorporated into the esLOG Service directly, and consist of applications such as third party collection devices and the like. esLOG Product Publisher is not responsible for the operation of any Third Party Services nor the availability or operation of the Services to the extent such availability and operation is dependent upon Third Party Services.

Client is solely responsible for procuring any and all rights necessary for it and its Clients to access Third Party Services and for complying with any applicable terms or conditions thereof. esLOG Product Publisher does not make any representations or warranties with respect to Third Party Services or any third party providers. Any exchange of data or other interaction between Client and a third party provider is solely between Client and such third party provider and is governed by such third party’s terms and conditions. g) Client agrees that during the term of this Agreement and for a period of one (1) year after the termination thereof it shall not solicit or assist anyone else to solicit any person who is then or at any time during the then preceding year was an employee or consultant of esLOG Product Publisher. h) Client agrees that it shall not make, or cause to be made, any untrue statement or communicate any untrue information (whether oral or written) that disparages or reflects negatively on the esLOG Services, esLOG Product Publisher or its management or employees. This paragraph shall not, however, prohibit the Client from testifying truthfully as a witness in any court proceeding or governmental investigation. i) During the term of this Agreement, the Client agrees that it shall not embed or utilize with the esLOG Services related software in any service substantially similar in functionality to or identical in functionality to the esLOG Services.

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Three-Year Agreement between the City of Indio and eSentire for Cybersec... Page 314 of 1671 City of Indio
City Council
July 17, 2024

STAFF REPORT
To: City Council
From: Bryan H. Montgomery, City Manager
Prepared by: Carl S. Morgan, Dir. Of Economic Development Conflict: Yes Member: Elaine Holmes
Subject: Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studio B, located at 45250 Smurr Street Suite 13.

RECOMMENDATION:

Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studio B, located at 45250 Smurr Street Suite 13.

SUMMARY:

Downtown Indio is in the middle of a renaissance, with new projects under construction or planned to start in the near future. With over $200 million in public and private investments coming to Downtown, which include the recently opened Gabino's Creperie, Italitca, Indio Taphouse, Encore Coffee, Victoria's Cafe, and Rocks and Records. In addition to the soon opening of the College of the Desert campus expansion, Desert Beer Co, Rosemary Hifi, and The Place. The proposed lease is consistent with the Downtown Specific Plan. It will stimulate new investment, generate additional sales tax revenues, and add to the music and art scene in Downtown Indio.

BACKGROUND INFORMATION:

The proposed lease with FFA Touring Inc. DBA Studio B represents another business choosing to invest in Downtown Indio. Sunny Sounds seeks to lease 45250 Smurr Street, Suite 13, which accounts for approximately 476 square feet. FFA Touring, Inc. is led by Ron Mesh, a partner of The Church Studios, a music recording studio in Cathedral City, and tour manager for Guns N Roses, Collective Soul, and most recently, Elvis Costello and Daryl Hall. Studio B will be the Coachella Valley's first Dolby Atmos mixing studio. Mixing in Dolby Atmos allows sound to be placed in a threedimensional space, allowing the listener to hear more of the music and movie. The studio will be open to the public, allowing visitors to see the sound mixed with Dolby Atmos quality.

In terms of the General Plan, the property on Smurr Street is within the Downtown Specific Plan zoned Downtown-Core (DT-C), which is characterized by lively, pedestrian-oriented retail and restaurant uses. Goal ED-7 of the General Plan states that an economic development goal is to have “A City with the destination hospitality, retail, and entertainment opportunities to meet the needs of visitors and residents.” Additional restaurant hospitality uses will conform to such a goal as part of the City's economic development strategy. Accordingly, the proposed lease is consistent with the General Plan and staff recommends that the City Council find that the lease of the property is in conformance with the General Plan.

AGENDA ITEM #8.13
Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 315 of 1671 FINANCIAL SUMMARY:

Current FY Financial
Impact:
$2,618 In current year budget: N/A
Current FY General
Fund Impact:
$2,618 Budget adjustment: N/A
Next FY Financial
Impact:
$2,618 Strategic Objective: Downtown & Hwy 111
Revitalization
Source of funds: Rental Income Fund-Org-Object
Reference:
101-405205
Additional Financial Details:

The salient terms of the Building Lease Agreement are as follows:

Premises: The building is located at 45250 Smurr Street Suite 13. The property consists of a onestory building of approximately 476 square feet.

Permitted Use of Premises: The Premises shall open and be used solely for the operation of recording studio to be open a minimum of 5 days a week with a minimum of 6 hours per day.

Lease Term: The term of the Agreement is three (3) years.

Rent Commencement Date: August 1, 2024
Rent: The rent shall be $238.00 per calendar month during the Term, prorated for any partial calendar month in the Term.

Security Deposit: Tenant shall pay the Security Deposit of $1,000 to Landlord on the date Tenant signs and delivers a counterpart of this Lease to Landlord.

Condition of Premises: Tenant is accepting the Premises in their current “as-is” condition, without representation or warranty, express or implied. Tenant Improvements: All tenant improvements are subject to review and approval by the City.

Prevailing Wages: In making the tenant improvements, the Tenant shall comply with the prevailing wage laws.

Possessory Interest Taxes and Utilities: Tenant shall be responsible for the payment of all real property taxes on Tenant’s possessory interest and all charges for gas, electricity, telephone service, water, sewer service, trash removal, and other utilities and services furnished to the Property during the Term.

Tenant Improvement Allowance: There is no Tenant Improvement Allowance for this lease.

ATTACHMENTS:

Attachment 1 FFA TOURING INC DBA STUDIO B
APPROVAL(S):

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 316 of 1671 Carl S. Morgan, Dir. Of Economic Development Approved - 11 Jul 2024 Jennifer A. Mizrahi, Assistant City Attorney Approved - 11 Jul 2024 Ruby D. Walla, Director of Finance Approved - 11 Jul 2024 Bryan H. Montgomery, City Manager Approved - 11 Jul 2024

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 317 of 1671

CITY OF INDIO COMMERCIAL LEASE AGREEMENT
SINGLE-TENANT – 45250 SMURR STREET
This Commercial Lease Agreement (“Lease”), dated the 3rd day of April 2024, for reference purposes only, is made by and between the CITY OF INDIO, a California municipal corporation (“Landlord”), and FFA TOURING, INC. DBA STUDIO B, a California Limited Liability Company, (“Tenant”). Landlord and Tenant are sometimes referred to in this Lease individually as a “Party”, and collectively as “Parties.”

ARTICLE I
PREMISES; EFFECTIVE DATE; TERM; DUE DILIGENCE PERIOD; MONTHLY RENT; DEPOSIT; USE; TENANT IMPROVEMENTS

1.1 Premises. Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, in accordance with the terms and conditions of this Lease, space within a building located at 45250 Smurr St. Suite 13, approximately located as shown by the shaded area and arrow on Exhibit “A” entitled “Lease Plan” (“Premises”).

1.2 Effective Date. This Lease shall not become effective until it has been approved by the governing body of Landlord and executed by the Parties.

1.3 Term. The lease term shall commence on August 1, 2024 (“Commencement Date”) and continue for a period of Three years (3) and shall expire on July 31, 2027 (“Expiration Date”) unless terminated earlier pursuant to provisions herein. Tenant shall have the option to renew the lease for an additional two (2) years and shall give one hundred eighty (180) days written notice prior to the Expiration Date. Parties shall negotiate in good faith the monthly rental amount for that renewal, the first year of which shall be 3-5% above the monthly rental amount in the preceding lease year.

1.4 Due Diligence Period. Intentionally Omitted

1.5 Monthly Rent. Tenant shall pay to Landlord, commencing on September 1, 2024, the following sums as Monthly Rent. Monthly Rent shall be paid in the matter specified in Section 3.1 of this Lease, entitled “Payment of Rent.”
September 1, 2024 to July 1, 2027 - $238 per month

1.6 Security Deposit. Tenant shall deposit with Landlord a security deposit for the Premises in the amount of One Thousand Dollars ($1,000) (“Deposit”). The Deposit shall be subject to the terms and conditions contained in Section 3.3 of this Lease.

1.7 Permitted Use. Tenant agrees to use the Premises for the following purpose(s), and for no other purpose: Dolby mixing and recording studio.

1.8 Tenant Improvements. Intentionally Omitted

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 318 of 1671 2 ARTICLE II
CONDITION OF PREMISES; DELIVERY OF PREMISES

2.1 Condition of Premises. Tenant has examined the Premises and agrees to take possession of the Premises in an “as is” condition. Tenant hereby acknowledges: (a) that it has been advised to satisfy itself with respect to the condition of the Premises (including but not limited to the electrical and fire sprinkler systems, security, environmental aspects, seismic and earthquake requirements, and compliance with the Americans with Disabilities Act), and applicable zoning, municipal, county, state and federal laws, ordinances and regulations and any covenants or restrictions of record (collectively “Applicable Laws”) and the present and future suitability of the Premises for Tenant’s intended use; (b) that Tenant has made such investigation as it deems necessary with reference to such matters, is satisfied with reference thereto, and assumes all responsibility therefore as the same relate to Tenant’s occupancy of the Premises and/or the terms of this Lease; and (c) that neither Landlord, nor any of Landlord’s agents, has made any oral or written representations or warranties with respect to said matters other than as set forth in this Lease.

As required by California Civil Code No 1938, an ADA Survey has not been conducted by a Certified Access Specialist for the Premises. A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises, Landlord may not prohibit Tenant from obtaining a CASp inspection of the subject premises for the occupancy or potential occupancy of Tenant, if requested by Tenant. The parties shall mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction-related accessibility standards within the premises.

2.2 Delivery of Premises. Landlord agrees to use its best commercially reasonable efforts to deliver possession of the Premises to Tenant by the Commencement Date of this Lease, as specified in Section 1.3. If, despite said efforts, Landlord is unable to deliver possession as agreed, Landlord shall not be subject to any liability therefore, nor shall such failure affect the validity of this Lease. Tenant shall not, however, be obligated to provide Monthly Rent or perform any other obligations under this Lease, until it receives possession of the Premises. If possession is not delivered within thirty (30) calendar days after the Commencement Date, Tenant may, by notice in writing after the end of such thirty (30) calendar day period, cancel this Lease and the Parties shall be discharged from all obligations hereunder.

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 319 of 1671 3 Tenant which Tenant fails to perform; and (v) repair, alter, or improve the Premises or any portion of the Premises, and may for such purposes erect, use and maintain scaffolding, pipes, conduits, and other structures in and through the Premises where reasonably required by the nature of the work to be performed; provided, however, that all such work shall be done as promptly as reasonably possible and so as to cause as little interference with the operation of Tenant’s business as reasonably possible. Tenant hereby waives any claim for damages, including but not limited to interference with business, lost profits, and any other incidental or consequential damages of any sort whatsoever, for any injury or inconvenience to or interference with Tenant’s business, any loss of occupancy or quiet enjoyment of the Premises or any other loss occasioned by such entry. Landlord shall at all times have and retain a key with which to unlock all of the doors in or about the Premises (excluding Tenant’s vaults, safes, and similar areas designated in writing by Tenant in advance); and Landlord shall have the right to use any and all means which Landlord may deem proper to open said doors in an emergency in order to obtain entry to the Premises, and any entry to the Premises obtained by Landlord by any of said means, or otherwise, shall not under any circumstances be construed or deemed to be a forcible or unlawful entry into or detainer of the Premises or an eviction, actual or constructive, of Tenant from the Premises or any portion thereof. No provision of this Lease shall be construed as obligating Landlord to perform any repairs, alterations, or improvements except as otherwise expressly agreed to be performed by Landlord in this Lease.

2.4 Vehicle Parking. Intentionally Omitted.

ARTICLE III
PAYMENT OF MONTHLY RENT; SECURITY DEPOSIT; LATE CHARGES

3.1 Payment of Rent. Monthly Rent shall be paid in advance on or before the first calendar day of each month during the Term. If the Term commences on a calendar day other than that first calendar day of the month or ends on a calendar day other than that last calendar day of a calendar month, then Monthly Rent will be appropriately prorated by Landlord based on the actual number of calendar days in such month. If the Term commences on a calendar day other than the first calendar day of a calendar month, then the prorated Monthly Rent for such month shall be paid on or before the first calendar day of the Term. Monthly Rent shall be paid to Landlord without written notice or demand, and without offset, in lawful money of the United States of America at Landlord' s address, or to such other address as Landlord may from time to time designate in writing.

3.2 Rent Adjustment and Improvements. Tenant will, at its sole cost and expense, design and construct tenant improvements for a Dolby mixing and recording studio. All changes are subject to the City’s written approval.

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 320 of 1671 4 Landlord may suffer by reason of Tenant' s default. If any portion of the Deposit is so used, applied, or retained, Tenant shall with five (5) calendar days after written demand deposit cash with the Landlord in an amount sufficient to restore the Deposit to its original amount. Landlord shall not be required to keep the Deposit separate from its general funds, and Tenant shall not be entitled to any interest earned on the Deposit. The Deposit shall not be deemed a limitation on Landlord' s damages or a payment of liquidated damages or a payment of rent due for the last month of the Term.

A. Tenant specifically waives the provisions of California Civil Code Section 1950 which provides that Landlord may claim from a security deposit only those sums reasonably necessary to remedy defaults in the payment of rent, to repair damage caused by Tenant, or to claim the Premises. Landlord and Tenant agree that Landlord may, in addition, claim those sums reasonably necessary to compensate Landlord for any other foreseeable or unforeseeable loss or damage caused by the act or omissions of Tenant or Tenant's officers, agents, employees, independent contractors, or otherwise.

B. If Tenant faithfully and timely performs every provision of this Lease to be performed by it, the Deposit or balance of the Deposit shall be returned to Tenant within sixty (60) calendar days after the expiration of the Term. Landlord may deliver the funds deposited under this Lease by Tenant to the purchaser of the Premises in the event that the Premises is sold, and after such time, Landlord shall have no further liability to Tenant with respect to the Deposit.

3.4 Late Charges. Tenant hereby acknowledges that late payment by Tenant of the Monthly Rent or any other sums due under this Lease will cause Landlord to incur costs not contemplated by this Lease. Such costs include, but are not limited to, processing and accounting charges and late charges which may be imposed upon Landlord by the terms of any mortgage or trust deed covering the Premises. Accordingly, if any installment of Monthly Rent or any other sums due from Tenant under this Lease, shall not be paid within ten (10) days after the time set forth in this Lease for payment thereof, Tenant shall thereupon pay to Landlord a late charge equal to ten percent (10%) of the overdue amount. Landlord and Tenant agree that this late charge represents a reasonable sum considering all of the circumstances existing on the date of this Lease, including the relationship of the sum to the loss to Landlord that could be reasonably anticipated by such nonpayment by Tenant and the anticipation that proof of actual damages sustained by Landlord would be costly or inconvenient to determine. Landlord and Tenant agree that such late charge shall in no event constitute a waiver of Tenant's default with respect to such overdue amount, nor prevent Landlord from exercising any of the other rights and remedies available to Landlord at law, in equity, or under this Lease. Landlord, at its option, may deem any such overdue amounts and/ or late charges so unpaid to be owing, nonpayment of which shall, in addition to any other rights and remedies available to Landlord, give rise to those rights and remedies of Landlord set forth in Section 12.2 of this Lease.

ARTICLE IV
USE; COMPLIANCE WITH LAWS; NON-DISCRIMINATION

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 321 of 1671 5 4.1 Use. The Premises shall be used only for the purposes set forth in Section 1.7 and purposes incidental to that use and in accordance with the General Rules and Regulations attached hereto as Exhibit “B.” Tenant shall use the Premises in a careful, safe, and proper manner and shall not use the Premises for any disreputable business or purpose. Tenant shall not use or permit the Premises to be used or occupied for any purpose or in any manner prohibited by any applicable law, ordinance order, rule, regulation, or other governmental requirement.

Tenant shall not commit waste or suffer or permit waste to be committed in, on, or about the Premises. Tenant shall conduct its business and control its employees, agents, and invitees in such a manner so as not to create a nuisance or a risk of fire or other hazard, or that would violate, suspend, void, or increase the rate of fire or liability or any other insurance of any kind at any time carried by Landlord upon the Premises.

4.2 Signs. Any signs to be installed by Tenant shall be subject to the prior written approval of Landlord and shall be installed by a sign contractor approved by Landlord. All required permits for signs shall only be obtained by the approved sign contractor who shall also be responsible for compliance with all applicable codes. Tenant shall be responsible for payment of all sign costs including installation costs, permits and costs to repair the Premises resulting from the installation or removal of such sign.

4.3 Compliance with Laws. Tenant shall comply with all applicable laws, ordinances, orders, rules, regulations, and other governmental requirements relating to the use, condition, or occupancy of the Premises. The judgment of any court of competent jurisdiction or the admission of Tenant in a proceeding brought against it by any governmental entity that Tenant has violated any such governmental requirement shall be conclusive as between the Landlord and the Tenant and shall constitute grounds for declaration of default, material breach, forfeiture, and termination of this Lease by Landlord.

4.4 Compliance with Environmental Laws. Tenant and the Premises shall remain in compliance with all applicable laws, ordinances, orders, rules and regulations regulating, relating to, or imposing liability of standards of conduct concerning any Hazardous Materials, or pertaining to occupational health or industrial hygiene, occupational or environmental conditions on, under, or about the Premises, as now or may at any later time be in effect, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”) [42 USC Section 9601 et seq.]; the Resource Conservation and Recovery Act of 1976 (“RCRA”) [42 USC Section 6901 et seq.]; the Clean Water Act, also known as the Federal Water Pollution Control Act (“FWPCA”) [33 USC Section 1251 et seq.]; the Toxic Substances Control Act (“TSCA”) [15 USC Section 2601 et seq.]; the Hazardous Materials Transportation Act (“HMTA”) [49 USC Section 1801 et seq.]; the Insecticide, Fungicide, Rodenticide Act [7 USC Section 6901 et seq.] the Clean Air Act [42 USC Section 7401 et seq.]; the Safe Drinking Water Act [42 USC Section 300f et seq.]; the Solid Waste Disposal Act [42 USC Section 6901 et seq.]; the Surface Mining Control and Reclamation Act [30 USC Section 101 et seq.] the Emergency Planning and Community Right to Know Act [42 USC Section 11001 et seq.]; the Occupational Safety and Health Act [29 USC Section 655 and 657]; the California Underground Storage of Hazardous Substances Act [H & S C Section 25288 et seq.]; the California Hazardous Substances Account Act [H & S C Section 25300 et seq.]; the California Safe Drinking Water and Toxic Enforcement Act [H & S C Section 24249.5 et seq.]

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 322 of 1671 6 the Porter-Cologne Water Quality Act [Water Code Section 13000 et seq.] together with any amendments of or regulations promulgated under the statutes cited above and any other federal, state or local law, ordinance, order, rule or regulation now in effect or later enacted that pertains to occupational health or industrial hygiene, and only to the extent the occupational health or industrial hygiene laws, ordinances, or regulations relate to hazardous substances on, under, or about the Premises, or the regulation or protection of the environment, including ambient air, soil, soil vapor, groundwater, surface water, or land use (“Environmental Laws”).

A. Tenant shall immediately notify Landlord in writing and provide copies upon receipt of all written complaints, claims, citations, demands, inquiries, reports, or notices relating to the condition of the Premises or compliance with Environmental Laws. Tenant shall promptly cure and have dismissed with prejudice and of those actions and proceedings to the satisfaction of Landlord. Tenant shall keep the Premises free of any lien imposed pursuant to and Environmental Law.

B. For the purpose of Section 4.4, the term “Hazardous Materials” shall include, without limitation, substances defined as “hazardous substances,” “hazardous materials,” “toxic substances,” “hazardous wastes,” “extremely hazardous wastes,” or “restricted hazardous wastes,” or stated to be known to cause cancer or reproductive toxicity, under any Environmental Law. Tenant shall not permit to occur any release, generation, manufacture, storage, treatment, transportation, or disposal of any Hazardous Materials. Tenant shall promptly notify Landlord in writing if Tenant has or acquires notice or knowledge that any Hazardous Materials have been or are threatened to be released, discharged, disposed of, transported, or stored on, in, under, or from the Premises; and if any Hazardous Materials are found on the Premises, Tenant, at its sole cost and expense, shall immediately take such action as is necessary to detain the spread of and remove the Hazardous Material to the complete satisfaction of Landlord and the appropriate governmental authorities.

C. Landlord shall, at Landlord’s sole cost and expense, have the right at all reasonable times and from time to time to conduct environmental audits of the Premises, and Tenant shall cooperate in the conduct of those audits.

D. If Tenant fails to comply with the forgoing covenants pertaining to Hazardous Materials, Landlord may cause the removal (or other cleanup acceptable to Landlord) of any Hazardous Materials from the Premises. The costs of Hazardous Materials removal and any other cleanup (including transportation and storage costs) will be owing under this Lease, whether or not a court has ordered the cleanup, and those costs will become due and payable on demand by the Landlord. Tenant shall give Landlord, its agents and employees, access to the Premises to remove or otherwise cleanup any Hazardous materials. Landlord, however, has no affirmative obligation to remove or otherwise cleanup any Hazardous Materials, and this Lease shall not be construed as creating any such obligation.

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 323 of 1671 7 liabilities, obligations, penalties, claims, litigation, demands, defenses, costs, judgments, suits, proceedings, damages (including consequential damages), disbursements or expenses of any kind (including attorneys’ and experts’ fees and expenses and fees and expenses incurred in investigating, defending or prosecuting any litigation, claim or proceeding) that may at any time be imposed upon, incurred by, or asserted or awarded against Landlord in connection or arising out of: (i) any Hazardous Material on, in, under or affecting all or any portion of the Premises, (ii) any violation or claim of violation of any Environmental Law by Tenant; or (iii) the imposition of any lien for the recovery of costs for environmental cleanup or other response costs relating to the release or threatened release of Hazardous Materials on, in, under or affecting all or any portion of the Premises. Tenant’s indemnification shall survive the expiration and termination of this Lease.

4.5 Non-Discrimination. Tenant herein covenants by and for itself, its heirs, executors, administrators, and assigns, and all persons claiming under or through it, and this Lease is made and accepted upon and subject to the requirement that there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, genetic information, gender, gender identity, gender expression, marital status, age, national origin, or ancestry, in the leasing, use, occupancy, tenure, or enjoyment of the Premises, nor shall the Tenant itself, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy of Tenants, sub-tenants, or vendees in the Premises herein leased.

ARTICLE V

TAXES AND UTILITIES

5.1 Possessory Interest Tax/Property Taxes. Tenant recognizes and understands that this Lease may create a possessory interest subject to taxation and that Tenant may be subject to the payment of taxes levied on such interest. Tenant shall pay all taxes including without limitation any possessory interest, real estate and personal property taxes and assessments assessed, levied, confirmed or imposed during the Term of this Lease, whether or not now customary or within the contemplation of Landlord and Tenant: (i) upon, measured by or reasonably attributable to the cost or value of Tenant’s equipment, furniture, fixtures and other personal property located in the Premises, or by the cost or value of the leasehold improvements made in or to the Premises by or for Tenant, regardless of whether title to the improvements is in Tenant or Landlord; (ii) upon or with respect to the possession, leasing, operation, management, maintenance, alteration, repair, use or occupancy by Tenant of the Premises or any portion of the Premises; (iii) upon the Premises and all personal property, furniture, fixtures and equipment, and all replacements, improvements, or additions to them, whether owned by Landlord or Tenant; and (iv) upon this transaction or any document to which Tenant is a party creating or transferring and interest or an estate in the Premises.

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 324 of 1671 8 or not the services are billed directly to Tenant. Tenant shall procure, or cause to be procured, without cost to Landlord, any and all necessary permits, licenses, or other authorizations required for the lawful and proper installation and maintenance upon the Premises of wires, pipes, conduits, tubes and other equipment and appliances for use in supplying any of the services to and upon the Premises. Landlord, upon request of Tenant, shall at the sole expense and liability of Tenant, join with Tenant in any application required for obtaining and continuing any of the services.

ARTICLE VI
INSURANCE; INDEMNIFICATION; WAIVER AND RELEASE

6.1 Minimum Insurance Requirements. Tenant, at its sole cost and expense, commencing on the date Tenant is given access to the Premises, and continuing during the Term, shall procure, pay for, and thereafter keep in full force and effect the following types of insurance, in at least the amounts and in the forms specified below:

A. Commercial General Liability (CGL) with limits no less than Two Million Dollars ($2,000,000.00) per occurrence basis including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than Two Million Dollars ($2,000,000) per occurrence. Tenant shall maintain in force liability insurance, at all times during the term of this Lease and any renewal or extension thereof, which shall insure and indemnify Landlord, the City Council and each member thereof, and every officer and employee of Landlord against liability or financial loss resulting from any suits, claims or actions brought by any person or persons and from all costs and expense of litigation brought against Landlord, the City Council and every member thereof for any injury to persons and/or damage to property in, on or about the Premises by reason of the use or occupation by Tenant or by any other person or persons of the Premises and the activities of Tenant.

B. A policy or policies of Workers Compensation insurance in the amount required by the State of California.

C. Property Insurance against all risk of loss at full replacement cost with no coinsurance penalty provision at Tenant’s cost and expense, shall be obtained and at all times during the term hereof maintain in effect covering (1) all improvements included in the Premises; (ii) Tenant’s trade fixtures, furnishings, equipment, and inventory of merchandise located in the Premises; and (2) all alterations, additions, and changes made in or to the Premises during the term of this Lease at Tenant’s expense, providing protection to the extent of not less than one hundred percent (100%) of the insurable value of all said items against any peril included under insurance industry practices in the jurisdiction of the Premises within the classification “fire and extended coverage,” together with insurance against vandalism, malicious mischief, and sprinkler leakage or other sprinkler damage, if sprinklers are installed, and including “use and occupancy” and/or “business interruption” coverage. Tenant hereby waives any and all rights of recovery against Landlord for any loss occurring to such items on account of fire or other casualty, and the aforesaid policies of insurance shall contain appropriate provision recognizing this release by Tenant and waiving all right of subrogation by the insurance carrier. The proceeds

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 325 of 1671 9 of such insurance, so long as this Lease remains in effect, shall be used to repair or replace the items so insured in the event of loss on account of fire or other casualty.

D. Automobile Liability: Covering any auto, or if Tenant has no owned autos, hired, and non-owned autos, with limits no less than the amount required by law per accident for bodily injury and property damage.

E. Plate Glass Insurance: Plate glass insurance covering all plate glass on the Premises at full replacement value; provided that Tenant shall be permitted to self-insure plate glass insurance.

F. Insurance covering all of Tenant’s Improvements and Tenant’s Alterations, in an amount not less than their full replacement value from time to time, including replacement cost endorsement, providing protection against any peril included within the classification Fire and Extended Coverage, sprinkler damage, vandalism, malicious mischief and such other additional perils as covered in an “all risks” standard insurance policy. Any policy proceeds shall be used for the repair or replacement of the property damaged or destroyed unless this Lease shall cease and terminate under the provisions of Article 14.

G. Business Interruption Insurance: Commercially reasonable business interruption insurance.

6.2 Delivery of Evidence of Tenant’s Insurance. Each such insurance policy or certificate thereof shall be delivered to Landlord by Tenant on or before the effective date of such policy and thereafter Tenant shall deliver to Landlord renewal policies or certificates at least thirty (30) calendar days prior to the expiration dates of the expiring policies. In the event that Tenant shall fail to insure or shall fail to furnish Landlord the evidence of such insurance as required by Article VI, Landlord may from time to time acquire (without any obligation to do so) such insurance for the benefit of Tenant or Landlord or both of them for a period not exceeding one (1) year, and any premium paid by Landlord shall be recoverable from Tenant. Tenant’s compliance with the provisions of Article VI shall in no way limit Tenant’s liability under any of the other provisions of this Lease. Landlord may at any time, and from time to time, inspect and/or copy any and all insurance policies required by this Lease.

6.3 Other Insurance Requirements. The insurance to be acquired and maintained by Tenant shall be with companies admitted to do business in the State of California and companies of Best’s Rating Guide of A or better. Tenant shall deliver to Landlord, prior to taking possession of the Premises, a certificate of insurance evidencing the existence of the policies required hereunder, and such certificate shall certify that the policy:

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 326 of 1671 10 C. Insures performance of Tenant’s indemnity set forth in this Lease; D. Provide that no act or omissions of Tenant shall affect or limit the obligations of the insurer with respect to other insureds or including Landlord; E. Include all waiver of subrogation rights endorsements necessary to affect the provisions below; and
F. Provide that the commercial general liability policy and the coverage provided shall be primary, that Landlord although an additional insured, shall nevertheless be entitled to recovery under such policy for any damage to Landlord by reasons of acts or omissions of Tenant, and that coverage carried by Landlord shall be noncontributory with respect to policies carried by Tenant.

6.4 Mutual Waiver of Subrogation. The Parties hereto release each other and their respective authorized employees, agents, and representatives, from any and all claims, demands, loss, expense, or injury to any person, or to the Premise or to personal property, including, but not limited to, furnishings, fixtures or equipment located therein, caused by or resulting from perils, events, or happenings which are the subject of insurance in force at the time of such loss.

Each Party shall cause each insurance policy obtained by it to provide that the insurer waives all right of recovery by way of subrogation against either party in connection with any damage covered by any policy. Neither Party shall be liable to the other for any damage caused by fire or any of the risks insured against under any insurance policy in effect as required by this Lease.

6.5 No Ownership. Nothing contained in Article VI shall be construed as creating or implying the existence of: (i) any ownership by Tenant of any fixtures, additions, alterations, or improvements in or to the Premises, or (ii) any right on Tenant’s part to make any addition, alteration, or improvement in or to the Premises.

6.6 Indemnity. Tenant agrees, except as to the sole negligence or willful misconduct of Landlord, to fully indemnify, defend, and hold Landlord, its elected and appointed officials, officers, employees, agents, successors and assigns, free and harmless from any and all thirdparty claims, liability, loss, damage, costs, or expenses, including attorney fees, resulting from Tenant’s occupation or use of the Premises, specifically including, without limitation, any claim of liability, loss or damage arising by reason of:

A. The death or injury of any person or persons, including Tenant or any person who is an employee, agent, guest, or customer of Tenant, or by reason of the damage or destruction of any property, including property owned by Tenant or any person who is an employee, agent, guest, or customer of Tenant, and caused or allegedly caused by either the condition of the Premises, or some act or omission of Tenant or of some agent, contractor, employee, servant, guest, or customer of Tenant on the Premises; B. Any work performed on the Premises or materials furnished to the Premises at the instruction or request of Tenant; and

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 327 of 1671 11 C. Tenant’s failure to perform any provision of this Lease, or to comply with any requirement of local, state, or federal law or any requirement imposed on Tenant or the Premises by any duly authorized governmental agency or political subdivision.

6.7 Waiver and Release. Tenant waives and releases all claims against Landlord, its employees, and agents with respect to the matters for which Landlord has disclaimed liability pursuant to the provisions of this Lease. In addition, Tenant agrees that Landlord, its elected and appointed officials, employees, agents, successors and assigns shall not be liable for any loss, injury, death, or damage (including consequential damages) to persons, property, or Tenant’s business occasioned by theft; acts of God; public enemy; injunction; riot; strike; insurrection; war; terrorism; court order; order of governmental body or authority; earthquake; fire; explosion; falling objects; water; rain; snow; leak or flow of water, or by dampness or from the breakage, leakage, obstruction, or other defects of the pipes, sprinklers, wires, appliances, plumbing, air conditioning, or light fixtures; or from construction, repair, or alteration of the Premises; or from any acts or omissions of any visitor of the Premises; or from any cause beyond Landlord’s control.

ARTICLE VII
REPAIRS AND MAINTENANCE; ALTERATIONS

7.1 Tenant Obligations. Tenant shall maintain in good condition and repair, the entirety of the Premises (except that portion of Premises to be maintained by Landlord under Section 9.2 below), including the Improvements and all Fixtures, and the HVAC systems, as well as the landscaping and all parking areas (collectively “Premises Systems”). Notwithstanding the foregoing, in case of complete HVAC failure or breakage that is beyond repair as documented by a third-party professional, Landlord and Tenant shall equally pay for the replacement of the HVAC system with Landlord and Tenant each paying fifty percent (50%) of the cost. In such case, Tenant shall obtain at least three bids, with Landlord having final approval of the contactor for such work.

7.2 Alterations. Tenant shall not make any alterations, improvements or additions in, on or about any of the Premises, without first obtaining Landlord’s prior written consent.

A. All alterations, improvements, or additions in, on or about the Premises, whether temporary or permanent in character, shall immediately become Landlord’s property and at the expiration of the Term of this Lease shall remain on the Premises without compensation to Tenant.

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 328 of 1671 12 and shall restore the Premises to the condition in which the Premises was before the alterations, improvements, and additions were made, reasonable wear and tear accepted.

7.3 Mechanic’s Liens. Tenant shall pay or cause to be paid all costs and charges for:
(i) work done by Tenant or caused to be done by Tenant, in or to the Premises, and (ii) all materials furnished for or in connection with such work. Tenant shall indemnify the Landlord against and hold the Landlord and the Premises free, clear and harmless of and from any liens or claims of liens arising out of any work performed, materials furnished, or obligations incurred by the Tenant, and Tenant shall be responsible for the removal of any such liens and all costs to remove same. Failure to remove any such liens within thirty (30) calendar days of written request by Landlord shall constitute a default of this Lease. At its election, but without having any obligation to do so, the Landlord may pay such liens not so removed by the Tenant and the amount expended by Landlord shall be paid by Tenant within fifteen (15) calendar days after delivery of a statement for the expense.

7.4 Landlord Obligations. Landlord shall be responsible for maintenance and repair of the heating, ventilation, and air conditioning systems for the Premises and general, mechanical, electrical, lighting, plumbing systems, structural roof, interior walls, interior surfaces of exterior walls, ceilings, floors, windows, doors, fixtures and appurtenances to the Premises. Notwithstanding the foregoing, Landlord will be responsible for repairs and maintenance of latent defects within the Premises.

ARTICLE VIII
DAMAGE AND DESTRUCTION; CONDEMNATION

8.1 Damage or Destruction of Premises. Unless as the result of negligence or intentional unlawful act of Tenant, if during the term of this Lease, any portion of the Premises shall be damaged by fire or other catastrophic cause, so as to render such portion of the Premises untenable, the obligations under this Lease may be suspended while such portion of the Premises remains untenable. In the event of such damage, Tenant shall give Landlord notice of such untenable conditions and the Landlord shall elect in its sole discretion, whether to repair the Premises or to cancel this Lease with respect thereto. It shall notify Tenant in writing of its election within thirty (30) calendar days after service of notice by Tenant. In the event that Landlord elects not to repair the Premises or portion thereof, this Lease shall be deemed canceled as of the date the damage occurred with respect to the applicable portion(s).

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 329 of 1671 13 income, rent, awards and any interest therein whatsoever which may be paid or made in connection therewith, and Tenant shall have no claim against Landlord for the bonus value of any unexpired Term of this Lease or otherwise; provided, however, that nothing herein shall prevent Tenant from pursuing a separate award against the taking entity, specifically for its relocation expenses or for the taking of any personal property or trade fixtures belonging to Tenant, so long as such separate award to Tenant does not diminish any award otherwise due Landlord as a result of such condemnation or taking.

ARTICLE IX
ASSIGNMENT; SUBLETTING; PROCESSING

9.1 Assignment and Subletting. Tenant shall not assign, mortgage, pledge, encumber, or hypothecate this Lease or any interest herein (directly, indirectly, voluntarily, or involuntarily, by operation of law, or otherwise) or sublet the Premises or any part thereof, or permit the use of the Premises by anyone other than Tenant without the prior written consent of Landlord first being obtained. If Tenant is a corporation, a limited liability company or a partnership, the transfer (as a consequence of a single transaction or any number of separate transactions) of fifty percent (50%) or more of the beneficial ownership interest of the voting stock of Tenant issued and outstanding as of the date hereof, the membership interests in Tenant or the partnership interests in Tenant, as the case may be, shall constitute an assignment hereunder for which such consent is required. Further, Tenant shall not assign this Lease or sublet the Premises or any portion thereof to any corporation which controls, is controlled by or is under common control with Tenant, or to any corporation resulting from merger or consolidation with Tenant, or to any person or entity which acquires all the assets as a going concern of the business of Tenant that is being conducted on the Premises, without the prior written consent of Landlord. Any of the foregoing acts without such consent shall be void and, at the sole option of Landlord, constitute an Event of Default entitling Landlord to terminate this Lease and to exercise all other remedies available to Landlord under this Lease and at law.

A. In the event that Tenant should desire to sublet the Premises or any part thereof, or assign this Lease, Tenant shall provide Landlord with written notice of such desire at least sixty (60) calendar days in advance of the proposed effective date of such subletting or assignment. Such notice shall include: (i) the name of the proposed subtenant or assignee; (ii) the nature of business to be conducted by the proposed subtenant or assignee in the Premises; (iii) the terms and conditions of the proposed assignment or sublease including but not limited to a detailed description of all compensation in cash or otherwise which Tenant would be entitled to receive in connection with such assignment or sublease; and (iv) the most recent financial statements or other financial information concerning the proposed subtenant or assignee as Landlord may require. At any time within thirty (30) calendar days following receipt of Tenant’s notice, Landlord may by written notice to Tenant elect to: (i) terminate this Lease as to the space affected by the proposed subletting or assignment, as of the effective date of the proposed subletting or assignment; (ii) consent to the proposed subletting of the Premises or assignment of this Lease; or (iii) disapprove of the proposed subletting or assignment. Landlord may elect to terminate this Lease as to the space affected by the proposed assign or subletting in its sole and

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 330 of 1671 14 absolute discretion. If Landlord does not elect to terminate this Lease, however, Landlord shall not unreasonably withhold its consent to a proposed subletting or assignment.

B. Subject to obtaining Landlord’s consent in accordance with the requirements of Section 9.1, in order for any assignment or sublease to be binding on Landlord, Tenant must deliver to Landlord, promptly after execution thereof, an executed copy of such sublease or assignment whereby the subtenant or assignee shall expressly assume all obligations of Tenant under this Lease as to the portion of the Premises subject to such assignment or sublease. Any purported sublease or assignment will be of no legal force or effect unless and until the proposed sublease has been consented to, in writing, by Landlord and a fully executed copy thereof has been received by Landlord.

C. Regardless of Landlord’s consent, no subletting or assignment shall release Tenant or any guarantor of Tenant, of its or their obligations, or alter the primary liability of Tenant and its guarantor(s), if any, to provide Monthly Rent and to perform all other obligations to be performed by Tenant hereunder. The acceptance of payments by Landlord from any other person shall not be deemed to be a waiver by Landlord of any provision hereof.

Consent to one assignment or subletting shall not be deemed consent to any subsequent or further assignment, subletting, hypothecation or third party use or occupancy. In the event of default by any assignee or successor of Tenant in the performance of any of the terms of this Lease, Landlord may proceed directly against Tenant and/or its guarantor(s), if any, without the necessity of exhausting remedies against said assignee or successor. Landlord may consent to subsequent assignments or subletting of this Lease or amendments or modifications to this Lease with assignees of Tenant, without notifying Tenant and/or its guarantor(s), if any, or any successor of Tenant, and without obtaining its or their consent thereto and such action shall not relieve Tenant and/or its guarantor(s), if any, or any successor of Tenant of liability under this Lease.

D. Landlord shall have the unconditional right to sell, encumber, pledge, convey, transfer, and/or assign any and all of its rights and obligations under the Lease without the consent of or notice to Tenant or any guarantor(s) of Tenant’s obligations hereunder.

9.2 Processing Fee. Tenant agrees to pay Landlord an administrative fee of One Thousand Dollars ($1,000.00) and an additional amount for reasonable attorney’s fees incurred in conjunction with the processing and document review of any requested transfer, assignment, subletting, license, or concession agreement, change of ownership, mortgage or hypothecation of the Lease or Tenant' s interest in and to the Premises

ARTICLE X
HOLDING OVER; SALE OF PREMISES; TERMINATION

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 331 of 1671 15 rent shall equal to one hundred and fifty percent (150%) of the monthly rent payable by Tenant at the expiration of the Term. In addition, Tenant shall continue to pay all other amounts due to Landlord hereunder. Each Party shall give the other notice at least one (1) month prior to the date of termination of such monthly tenancy of its intention to terminate such tenancy. If, after objection by Landlord thereto, Tenant holds possession of the Premises after expiration of the Term, Tenant shall constitute a Tenant at sufferance and without in any way waiving the wrongful holding over of the Premises by Tenant, Landlord shall be entitled to receive for each month or portion thereof during which Tenant wrongfully holds over at the Premises monthly rent equal to two hundred percent (200%) of the monthly rent payable by Tenant at the expiration of the Term together with all other amounts otherwise due to Landlord hereunder.

Landlord' s receipt of increased monthly rent under this Section 10.1 shall not constitute an extension of the Term nor shall it constitute a waiver of Tenant' s wrongful holding over and shall not prejudice any other rights or remedies available to Landlord under this Lease or by law.

10.2 Sale of Premises. In the event Landlord, or any successor owner of the Premises, shall sell or convey the Premises, all liabilities and obligations on the part of the Landlord, or such successor owner, under this Lease accruing thereafter shall terminate, and thereupon all such liabilities and obligations shall be binding upon the new owner. Tenant agrees to attorn to such new owner.

10.3 Early Termination of Tenancy. Notwithstanding any provision of this Lease to the contrary, Landlord reserves the right, in its sole and absolute discretion, and independent of whether or not Tenant may or may not be in default of this Lease, to terminate this Lease at any time by providing sixty (60) days advance written notice to Tenant of such termination. In such event, Tenant shall immediately surrender the Premises to Landlord. If Tenant fails to do so, Landlord may, without notice and without prejudice to any other remedy Landlord may have, enter upon and take possession of the Premises and expel or remove Tenant and its effects without being liable to prosecution or any claim for damages therefore. Tenant shall owe Landlord for all loss and damages which Landlord may suffer by reason of such failure of Tenant to vacate.

ARTICLE XI
SUBORDINATION; ESTOPPEL CERTIFICATES

11.1 Subordination. This Lease and the rights of Tenant hereunder are subject and subordinate to any ground or underlying lease and the lien of the holder of or beneficiary under a mortgage or deed of trust which now or in the future encumbers the Premises and to any and all advances made thereunder, and interest thereon, and all modifications, renewals, supplements, consolidations and replacements thereof. Tenant agrees that any ground or underlying landlord or lender may at its option, unilaterally elect to subordinate in whole or in part, such ground or underlying lease or the lien of such mortgage or deed or trust to this Lease. Such subordination or priority of this Lease, as the case may be, shall be effective without the necessity of executing any further instrument or agreement to effect such subordination or priority; provided, however, that Tenant agrees to execute, acknowledge, and deliver to Landlord upon demand any and all instruments required by Landlord or any such ground or underlying Landlord or lender

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 332 of 1671 16 evidencing the subordination or priority of this Lease, as the case may be. Tenant hereby irrevocably appoints Landlord as its agent and attorney-in-fact to execute, acknowledge, and deliver any such instruments in the name of and on behalf of Tenant if Tenant fails to so execute, acknowledge and deliver such instruments within ten (10) calendar days after written request therefore.

11.2 Estoppel Certificates. At any time and from time to time, Tenant shall execute, acknowledge and deliver to Landlord, within five (5) calendar days after request by Landlord, a certificate certifying, among other things: (i) that this Lease is unmodified and in full force and effect (or, if there have been modifications, that this Lease is in full force and effect, as modified, and stating the date and nature of each modification); (ii) the date, if any, to which monthly rent (if applicable) and other sums payable hereunder have been paid; (iii) that no notice has been received by Tenant of any default which has not been cured except as to defaults specified in said certificate; and (iv) such other matters as reasonably may be requested by Landlord.

ARTICLE XII
DEFAULT; REMEDIES; DISPUTE RESOLUTION

12.1 Default; Breach.

A. Default. A “Default” by Tenant is defined as a failure by Tenant to observe, comply with, or perform any of terms, covenants, conditions, or rules applicable to Tenant under this Lease, and shall include but not be limited to:
(1) Failure to provide the Monthly Rent set forth in Section 1.5 or other amounts owing pursuant to the terms of this Lease.
(2) Vacation or abandonment of the Premises or a disruption in services for a period time exceeding five (5) calendar days.
(3) Failure by Tenant to provide Landlord with reasonable evidence of insurance required under this Lease.
(4) Failure by Tenant to timely deliver to Landlord any instrument or assurances required pursuant to this Lease, including an estoppel certificate pursuant to Section

11.2 of this Lease.
(5) Failure by Tenant to provide Landlord with reasonable written evidence (in duly executed original form, if applicable) of compliance with Applicable Requirements and Applicable Laws when requested.
(6) Occurrence of any of the following events: (i) the making by Tenant of any general arrangement or assignment for the benefit of creditors; (ii) Tenant’s becoming a “debtor” as defined in 11 U.S. Code Section 101 or any successor statute thereto (unless, in the case of a petition filed against Tenant, the same is dismissed within sixty (60) days); (iii) the appointment of a trustee or receiver to take possession of substantially all of Tenant’s assets

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 333 of 1671 17 located at the Premises or of Tenant’s interest in this Lease, where possession is not restored to Tenant within thirty (30) days; or (iv) the attachment, execution, or other judicial seizure of substantially all of Tenant’s assets located at the Premises or of Tenant’s interest in this Lease, where such seizure is not discharged within thirty (30) days; provided, however, in the event that any provision of this Subparagraph 12.1(A)(6) is contrary to any applicable law, such provision shall be of no force or effect, and shall not affect the validity of the remaining provisions. (7) Failure of Tenant to fulfill any obligation under this Lease which endangers or threatens life or property, where such failure continues for a period of one (1) calendar day following written notice thereof by or on behalf of Landlord to Tenant. (8) Tenant making or furnishing any warranty, representation, or statement to Landlord in connection with this Lease, or any other agreement made by Tenant for the benefit of Landlord, which is or was false or misleading in any material respect when made or furnished. (9) Assignment or sublease of this Lease or any portion of the Premises, or attempt to assign or sublease this Lease or any portion of the Premises, by Tenant in violation of Section 9.1.
(10) Tenant committing waste on the Premises.
(11) Failure of Tenant to otherwise perform, satisfy, or abide by any of the terms, covenants, conditions, or provisions of this Lease.

B. Breach. In the event that Tenant is in Default of this Lease, Landlord shall notify Tenant in writing of the nature of the Default and of the corrective action to be taken. If corrective action is not commenced within ten (10) business days after receipt of written notice and not completed within thirty (30) days thereafter, or longer, if Tenant is diligently pursing corrective action, such failure by Tenant shall constitute a “Breach,” and Landlord may pursue those remedies set forth in Section 12.2.

12.2 Remedies. On the occurrence of Tenant’s Breach of this Lease, Landlord shall have the right to pursue any one or more of the following remedies in addition to any other remedies now or later available to Landlord, either in law or equity, which remedies shall not be exclusive, but shall instead be cumulative: (i) remove all persons and property from the Premises and repossess same, in which case any and all of Tenant’s property that Landlord removes from the Premises may be stored in a public warehouse or elsewhere at the cost of, and for the account of, Tenant; or (ii) allow Tenant to remain in full possession and control of the Premises.

A. If Landlord chooses to repossess the Premises, then this Lease will automatically terminate in accordance with the provisions of California Civil Code Section 1951.

In the event of such termination of the Lease, Landlord may recover from Tenant:
(1) The worth at the time of award of the unpaid rent which had been earned at the time of termination, including interest at the maximum rate allowed by law;

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 334 of 1671 18 (2) The worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of the award exceeds the amount of such rental loss that Tenant proves could have been reasonably avoided, including interest at the maximum rate allowed by law; (3) The worth at the time of award of the amount by which the unpaid rent for the balance of the Term after the time of award exceeds the amount of such rental loss that Tenant proves could be reasonably avoided; and (4) Any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant' s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom.

B. “The worth at the time of the award,” as used in Section 12.2(A) shall be computed by allowing interest at the maximum rate allowed by law. “The worth at the time of the award” shall be computed by discounting the amount at the discount rate of the Federal Reserve Bank at the time of the award, plus one percent (1%).

C. Tenant shall be liable immediately to Landlord for all costs Landlord incurs in reletting the Premises, including, without limitation, lost rents, eviction costs, attorney's fees, brokers' commissions, expenses of remodeling the Premises required by the re-letting, and like costs. Re-letting can be for a period shorter or longer than the remaining Term. Tenant shall pay to Landlord the rent due under this Lease on the dates the rent is due, unless Landlord notifies Tenant that Landlord elects to terminate this Lease. After Tenant's Default and for as long as Landlord does not terminate Tenant's right to possession of the Premises, if Tenant obtains Landlord's consent, Tenant shall have the right to assign its interest in this Lease, or sublet all or a portion of the Premises, but Tenant shall not be released from liability or its obligations under this Lease. Landlord's consent to a proposed assignment or subletting shall be as required in Section 9.1.

D. If Landlord elects to re-let the Premises, then any rent that Landlord receives from re-letting shall be applied to the payment of: (i) first, any indebtedness from Tenant to Landlord other than rent due from Tenant; (ii) second, all costs incurred by Landlord in re-letting, including costs for maintenance; and (iii) third, Rent due and unpaid under this Lease.

E. After deducting the payments referred to in Section 12.2, any sum remaining from any rent that Landlord receives from re-letting shall be held by Landlord and applied in payment of future rent as rent becomes due under this Lease. In no event shall Tenant be entitled to any excess rent received by Landlord. If, on the date rent is due under this Lease, the rent received from any re-letting is less than the rent due on that date, then Tenant shall pay to Landlord, in addition to the remaining rent due, all costs which Landlord incurred in re-letting, including without limitation maintenance, that remain after applying the rent received from the re-letting, as provided in Section 12.2.

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 335 of 1671 19 12.3 Continuation after Breach. Even though Tenant has breached this Lease and/or abandoned the Premises, this Lease shall continue in full force and effect for so long as Landlord does not terminate Tenant’s right to possession as provided in Section 12.2 above, and Landlord may enforce all its rights and remedies under this Lease. In such event, Landlord may exercise all of the rights and remedies of a Landlord under California Civil Code Section 1951.4, or any successor statute. Acts of maintenance or preservation or efforts to re-let the Premises or the appointment of a receiver upon initiative of Landlord to protect Landlord’s interest under this Lease shall not constitute a termination of Tenant’s right to possession.

12.4 Other Relief. In the event of re-entry or taking possession of the Premises, Landlord shall have the right but not the obligation to remove all or any part of the trade fixtures, furnishings, equipment, and personal property located in the Premises and to place the same in storage at a public warehouse at the expense and risk of Tenant or to sell such property in accordance with applicable law. The remedies provided for in this Lease are in addition to any other remedies available to Landlord at law or in equity, by statute or otherwise. Any amounts so expended by Landlord shall be immediately payable by Tenant.

12.5 Landlord's Right to Cure Default. All agreements and provisions to be performed by Tenant under any of the terms of this Lease shall be at its sole cost and expense. If Tenant shall fail to perform any other act on its part to be performed hereunder and such failure shall not be cured within the applicable cure period provided for herein, if any, Landlord may, but shall not be obligated so to do, and without waiving or releasing Tenant from any obligations of Tenant, make any such payment or perform any such other act on Tenant's part to be made or performed as provided in this Lease. All sums so paid by Landlord and all necessary incidental costs shall be on Tenant's account and shall be payable to Landlord on demand.

12.6 Dispute Resolution. Any dispute arising out of or relating to this Lease, or breach thereof, shall be first submitted to the senior management of each Party for resolution during a thirty (30) calendar day dispute resolution period. Notice must be in writing and served pursuant to Section 13.1 herein. The foregoing dispute resolution period shall run concurrently with any notice and cure periods provided for herein.

ARTICLE XIII

GENERAL PROVISIONS

13.1 Attorneys’ Fees. Should any action or proceeding be commenced by Landlord to enforce the provisions provided in this Lease, or should any litigation be commenced between the parties to this Lease concerning said Property, this Lease, or the rights and duties of either in relation thereto, the prevailing party in such litigation shall be entitled, in addition to such other relief as may be granted as the result of said litigation, to a reasonable sum for its attorneys’ fees.

13.2 Notice. All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered or sent by registered or certified mail, return receipt requested, telegraphed, delivered or sent by telex, telecopy or cable and shall be deemed

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 336 of 1671 20 received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if mailed, three (3) business calendar days after the date of posting by the United States post office, (iii) if given by telegraph or cable, one (1) business calendar day after the date delivered to the telegraph company with charges prepaid.

To Landlord: To Tenant:

City of Indio FFA Touring, Inc.
100 Civic Center Mall 2144 N. Junipero Ave
Indio, CA 92201 Palm Springs, CA 92262
Attn: City Manager Attn: Ron Mesh

A. Notice of change of address shall be given by written notice in the manner detailed in this Section. Rejection or other refusal to accept, or the inability to deliver because of changed address of which no notice was given, shall be deemed to constitute receipt of the notice, demand, request or communication sent.

B. Tenant hereby agrees that service of notice in accordance with the terms of this Lease shall be in lieu of the methods of service specified in Section 1161 of the California Code of Civil Procedure Section 1161. The provisions of California Code of Civil Procedure Section 1013(a), extending the time within which a right may be exercised or an act may be done, shall not apply to a notice given pursuant to this Lease.

13.3 Tenant Reports. On the fifteenth (15th) day of each calendar month, during the Term hereof, Tenant shall submit to Landlord a statement in writing certified to be correct (if Tenant is a corporation, the statement shall be certified by an officer of the corporation, by an officer of Tenant) as to total gross sales, from all sources, for the proceeding calendar month.

13.4 Counterparts. This Lease may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute one and the same instrument.

13.5 Captions. Any captions to, or headings of, the sections or subsections of this Lease are solely for the convenience of the parties hereto, are not a part of this Lease, and shall not be used for the interpretation or determination of the validity of this Lease or any provision hereof.

13.6 Amendment of Agreement. The terms of this Lease may not be modified or amended except by an instrument in writing executed by each of the Parties hereto.

13.7 Waiver. The waiver by Landlord or Tenant of any agreement, condition, or provision herein contained shall not be deemed to be a waiver of any subsequent breach of the same or any other agreement, condition or provision herein contained, nor shall any custom or practice which may grow up between the Parties in the administration of the terms hereof be construed to waive or to lessen the right of Landlord or Tenant to insist upon the performance by

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 337 of 1671 21 Tenant or Landlord in strict accordance with said terms. The subsequent acceptance of any payment hereunder by Landlord shall not be deemed to be a waiver of any breach by Tenant of any agreement, condition or provision of this Lease, other than the failure of Tenant to pay the particular amount so accepted. Specifically, Landlord may accept any payment from Tenant and apply same to any amount owing hereunder notwithstanding any stated intent or instruction on the part of Tenant to the contrary and without waiving or compromising any claim that such payment was less than the payment actually due from Tenant.

13.8 No Merger. The voluntary or other surrender of this Lease by Tenant, or a mutual cancellation thereof, shall not work as a merger, and shall, at the option of Landlord, terminate all or any existing subleases or sub-tenancies, or may, at the option of Landlord, operate as an assignment to it of any or all such subleases or sub-tenancies.

13.9 Applicable Law. This Lease shall be governed by and construed in accordance with the laws of the State of California.

13.10 Fees and Other Expenses. Except as otherwise provided herein, each of the Parties shall pay its own fees and expenses in connection with this Lease, including any permit or license fees which Tenant may be required to obtain pursuant to its occupancy.

13.11 Authority to Execute Agreement. Landlord and Tenant represent and warrant that the individuals who have signed this Lease have the legal power, right and authority to enter into this Lease so as to bind each Party for whom they sign to perform as provided herein.

13.12 Successors and Assigns. This Lease shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto. Tenant shall be responsible for the acts or omissions of its subtenant(s), if any.

13.13 Incorporation of Exhibits. Each of the Exhibits to this Lease are incorporated by reference as though fully set forth herein.

13.14 Entire Agreement. This Lease supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between Tenant and Landlord as to the subject matter hereof. No subsequent agreement, representation, or promise made by either Party hereto, or by or to any employees or agents of either Party shall be of any effect unless it is in writing and executed by the party to be bound thereby. (Signatures on following page)

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 338 of 1671 IN WITNESS WHEREOF, the Parties hereto have executed this Lease as of the calendar day and year written below.

LANDLORD:

CITY OF INDIO, a California
municipal corporation
By:

Bryan H. Montgomery
City Manager

Date: __________________________
ATTEST:

By: _____________________________
Sabdi Sanchez
City Clerk

Date: ___________________________
APPROVED AS TO FORM:

By:

Steven P. Graham
City Attorney
TENANT:

FFA TOURING, Inc. a California
corporation
By: ____________________________
Ron Mesh
Chief Executive Officer
Date: ________

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 339 of 1671 2 EXHIBIT “A”
Premises/Lease Plan

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 340 of 1671 3 EXHIBIT “B”
General Rules and Regulations

1. Business shall operate and be open to the public at a minimum of five (5) days per week with a minimum of 6 hours per day.

2. All floor areas of the Premises (including vestibules, entrances and air returns), doors, fixtures, windows, and plate glass shall be maintained by Tenant, in a clean, safe and good condition.

3. All trash, refuse and waste materials shall be stored in adequate containers, approved by Landlord and regularly removed from the Premises. These containers shall not be visible to the general public and shall not constitute a health or fire hazard or nuisance to any tenant. In the event that any tenant shall fail to remedy such a health or fire hazard or nuisance within five (5) days after written notice by Landlord, Landlord may remedy and/or correct such health or fire hazard or nuisance at the expense of Tenant. Tenant must obtain a separate temporary dumpster to receive its move-in merchandising debris, and construction debris from any tenant improvements or alterations. Should it be necessary for Landlord to have Tenant's solid or liquid rubbish cleaned up, the cost for such cleaning shall be charged back to Tenant along with an administrative fee of fifteen per cent (15%).

4. No portion of the Premises shall be used for lodging purposes. No cooking is allowed on the Premises unless Tenant is a restaurant.

5. Neither sidewalks nor walkways shall be used to display, store or place any merchandise, equipment or devices, except in connection with sidewalk sales held with Landlord's prior written approval in each instance.

6. No public telephone, newsstand, shoeshine stand, refreshment, vending or other coin operated machine shall be installed or placed on the sidewalk or walkway area adjacent to the Premises or on the Common Facilities without Landlord's prior written approval in each instance. No public telephones are allowed within or outside of the Premises (other than Landlord provided public telephones).

7. No person or persons shall use the Premises, or any part thereof, for conducting therein a second-hand store, auction, distress or fire sale or bankruptcy sale, or "going out of business" sale or "lost our lease" sale, without Landlord's prior written consent in each instance.

8. No portion of the Premises shall be used for the storage of any merchandise, materials or other properties, other than those reasonably necessary for the operation of Tenant's business. Landlord may, from time to time, inspect the Premises to ensure compliance with the foregoing provisions.

9. No display areas of the Premises shall be left vacant, and Tenant shall not black out or otherwise obstruct the windows of the Premises, without Landlord's prior written consent. Signs in the windows may be limited and must be approved by the Landlord in writing.

10. Landlord shall have the absolute right to enter upon the Premises to perform such cleaning and clearing of the pipes and drains servicing the Premises (including rotoPage 27 of 29 AGENDA ITEM #8.13 Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 341 of 1671 4 rooter service), and any grease traps and exhaust systems servicing the Premises, as Landlord shall deem necessary.

11. If Tenant shall operate a carry-out food operation, including food and/or soft drink vending machines as well as any ice cream store, Tenant shall pay Landlord for all sidewalk and walkway cleanup work (including without limitation steam cleaning), that Landlord shall determine is necessary to preserve the sanitation, cleanliness and clean appearance of the Center. Tenant shall pay Landlord on an estimated month basis, adjusted annually, and will be responsible for a cleanup of not less than one hundred feet (100') in radius from the entrance(s) to the Premises.

12. The sidewalks, exits and entrances shall not be obstructed by Tenant or used by it for any purpose other than for ingress to and egress from the Premises.

13. Tenant shall not alter any lock or install any new or additional locks or any bolts on any door of the Premises without the prior written consent of Landlord (except as to safes and vaults of the Tenant). Installation of floor safes will require prior written approval by Landlord and must remain with the Premises at termination.

14. The toilet rooms and urinals, wash bowls and other apparatus therein shall not be used for any purpose other than that for which they were constructed and no foreign substance of any kind whatsoever shall be placed therein. The expense of any breakage, stoppage or damage resulting from the violation of this rule shall be borne by the Tenant who, or whose employees, invitees, contractors or agents, shall have caused it.

15. Tenant shall not use, keep or permit to be used or kept, any noxious gas or substance in the Premises, or permit or suffer the Premises to be occupied or used in a manner offensive or objectionable to Landlord or other occupants of the Premises by reason of noise, odors, and/or vibrations, or interfere in any way with other tenants or those having business therein. Tenant shall not make or permit to be made any loud or disturbing noises or disturb or interfere with neighbors’ use and enjoyment of their property, whether by the use of any musical instrument, radio, television, video or audio recording, shouting, or in any other manner. Tenant shall not throw anything out of doors.

16. Landlord will direct electricians as to where and how electrical, telephone, television and cable wires are to be introduced to the Premises. No boring or cutting for wires will be allowed without the prior consent of Landlord. The location of telephone call boxes and other office equipment in the Premises shall be subject to the approval of Landlord. All such consents and approvals by the Landlord must be in writing.

17. Tenant shall be responsible for assuring that doors to the Premises are not left unlocked during non-business hours, except while moving furniture or other items in or out of the Premises.

18. Landlord reserves the right to exclude or expel from the Premises any person who, in the judgment of Landlord, is intoxicated or under the influence of liquor or drugs, or is violating the rules and regulations of the Premises.

19. The requirements of Tenant will be attended to only upon application to Landlord’s designated property manager. Employees of Landlord shall have no obligation to perform any work for Tenant or do anything outside their regular duties for Tenant unless under special instructions from Landlord, and no employee shall have any

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 342 of 1671 5 obligation to admit any person (Tenant or otherwise) to any office of Landlord without specific instruction from Landlord.

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Approval of a Commercial Lease Agreement with FFA Touring Inc. DBA Studi... Page 343 of 1671 City of Indio
City Council
July 17, 2024

RECOMMENDATION:

Approval of a Commercial Lease Agreement with Woo Hospitality, LLC. Located at 82862 Miles Ave.

SUMMARY:

Downtown Indio is in the middle of a renaissance, with 18 new projects under construction or planned to start in the near future. With over $200 million in public and private investments coming to Downtown, which include the recently opened Gabino's Creperie, Italitca, Indio Taphouse, Encore Coffee, Victoria's Cafe, and Rocks and Records. In addition to the soon opening of College of the Desert campus expansion. The proposed lease is consistent with the Downtown Specific Plan. It will stimulate new investment, generate additional sales tax revenues, and add to the music and art scene in Downtown Indio.

BACKGROUND INFORMATION:

The proposed lease with Woo Hospitality, LLC, DBA Donna Forte, represents another business choosing to invest in Downtown Indio. Woo Hospitality, LLC seeks to lease a city-owned suite located at 82862 Miles Avenue, which is approximately 3,000 square feet. The proposed restaurant, Donna Forte, will be the third restaurant concept from Chef Gabriel Woo. As Executive Chef and Partner, Chef Woo has led Bar Cecil to receive a MICHELIN star in 2022. Donna Forte will be a place where customers can meet with a friend to catch up, with co-workers to vent, with a lover to celebrate, or with family to bond. Offering delicious, thin, and Neapolitan crust, hand-formed, traditional pizzas, and cold, crunchy, savory salads, and modifiable Charcuterie Boards will introduce a trendy and engaging product. Delicious seasonal entrees and desserts, along with a well-thought-out beer and wine list, will round out the menu. Donna Forte seeks to be harmonious and hip while being classy and sophisticated.

In terms of the General Plan, the property on Miles Avenue is within the Downtown Specific Plan zoned Downtown-Core (DT-C) characterized by lively, pedestrian-oriented retail and restaurant uses. Goal ED-7 of the General Plan states that an economic development goal is to have “A City with the destination hospitality, retail, and entertainment opportunities to meet the needs of visitors and residents.” Additional restaurant hospitality uses will conform to such a goal as part of the City's economic development strategy. Accordingly, the proposed lease is consistent with the General AGENDA ITEM #8.14
Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 344 of 1671 Plan and staff recommends that the City Council find that the lease of the property is in conformance with the General Plan.

FINANCIAL SUMMARY:

Current FY Financial
Impact:
$105,000 In current year budget: Yes
Current FY General
Fund Impact:
$105,000 Budget adjustment:

Next FY Financial
Impact:
$0 Strategic Objective: Downtown & Hwy 111
Revitalization
Source of funds: General Fund Fund-Org-Object
Reference:

Additional Financial Details:

General Fund Impact
Tenant Improvement Expense $105,000
The salient terms of the Building Lease Agreement are as follows:

Premises: The building is located at 82862 Miles Avenue (Attachment 2). The property consists of a one-story building of approximately 3,000 square feet.

Permitted Use of Premises: The Premises shall open and be used solely for the operation of a fullservice restaurant.

Lease Term: The term of the Agreement is five (5) years.

Rent Commencement Date: Twelve months from when the Landlord delivers the keys to the tenant.

Rent: The rent shall be $1,500.00 per calendar month during the Term, prorated for any partial calendar month in the Term.

Security Deposit: Tenant shall pay the Security Deposit of $3,000 to Landlord on the date Tenant signs and delivers a counterpart of this Lease to Landlord.

Condition of Premises: Tenant is accepting the Premises in their current “as-is” condition, without representation or warranty, express or implied. Tenant Improvements:

The first is the Tenant’s initial improvements that are paid for by the Tenant with their own capital.

The second type of improvements are those paid for with the tenant improvement allowance. All tenant improvements are subject to review and approval by the City.

Prevailing Wages: In making the tenant improvements, the Tenant shall comply with the prevailing wage laws.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 345 of 1671 Tenant Improvement Allowance: Landlord is providing the Tenant with a tenant improvement allowance of One Hundred Five Thousand Dollars ($105,000) that will be utilized for the actual costs of design and construction of certain Improvements.

ATTACHMENTS:

Attachment 1- Woo Hospitality LEASE
APPROVAL(S):

Carl S. Morgan, Dir. Of Economic Development Approved - 09 Jul 2024 Steven Graham Pacifico, City Attorney Approved - 09 Jul 2024 Ruby D. Walla, Director of Finance Approved - 10 Jul 2024 Bryan H. Montgomery, City Manager Approved - 10 Jul 2024

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 346 of 1671

CITY OF INDIO COMMERCIAL LEASE AGREEMENT
SINGLE-TENANT – 82862 MILES AVENUE
This Commercial Lease Agreement (“Lease”), dated the 1st day of August 2024, for reference purposes only, is made by and between the CITY OF INDIO, a California municipal corporation (“Landlord”), and WOO HOSPITALITY, LLC. a California limited liability company (“Tenant”). Landlord and Tenant are sometimes referred to in this Lease individually as a “Party”, and collectively as “Parties.”

ARTICLE I
PREMISES; EFFECTIVE DATE; TERM; DUE DILIGENCE PERIOD; MONTHLY RENT; DEPOSIT; USE; TENANT IMPROVEMENTS

1.1 Premises. Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, in accordance with the terms and conditions of this Lease, space within a building located at 82862 Miles Avenue, Indio, CA, 92201, approximately located as shown by the shaded area and arrow on Exhibit “A” entitled “Lease Plan” (“Premises”).

1.2 Effective Date. This Lease shall not become effective until it has been approved by the governing body of Landlord and executed by the Parties.

1.3 Term. The lease term shall commence on the date of delivery of the Premises (“Commencement Date”) and continue for a period of five (5) years and shall expire on the fifth (5th) anniversary of the Commencement Date (“Expiration Date”) unless terminated earlier pursuant to provisions herein. Tenant shall have the option to renew the lease for an additional five (5) years and shall give one hundred eighty (180) days’ prior notice of extension according to the Expiration Date. Parties shall negotiate in good faith the monthly rental amount for that renewal, the first year of which shall be 3-5% above the monthly rental amount in the preceding lease year.

1.4 Due Diligence Period. Notwithstanding anything herein to the contrary, Tenant shall have a period of twelve (12) months from the Effective Date of the Lease (“Due Diligence Period”) to conduct due diligence activities, including making all Tenant Improvements, conducting any inspections, testing, investigations, studies, obtaining of permits, variances and approvals that are reasonably necessary to build and operate the Premises as a Full Service Restaurant. Tenant shall have a right of access to the Premises to build a restaurant facility.

Tenant acknowledges that all of the terms and conditions of this Lease shall apply during the Due Diligence Period, including, without limitation, the insurance and indemnification requirements herein. Tenant shall promptly repair any and all damage to the Premises caused by the inspections, testing, investigations, studies, and construction permitted by this Section.

Should Tenant be unable to obtain Permits within the Due Diligence Period, parties may extend the Due Diligence Period by written amendment to this Lease. If, following the expiration of the Due Diligence Period, and any extension periods which Tenant chooses to exercise, Tenant has not received completed the Tenant Improvements, Landlord may, in its sole and absolute discretion, terminate this Agreement, and the Landlord shall have no further obligation to Tenant.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 347 of 1671 2 1.5 Monthly Rent. Tenant shall pay to Landlord, commencing on the day following the last day of the Due Diligence Period, Monthly Rent in the amount of One Thousand Five Hundred Dollars ($1,500) per month. Monthly Rent shall be paid in the matter specified in Section 3.1 of this Lease, entitled “Payment of Rent.”

1.6 Security Deposit. Tenant shall deposit with Landlord a security deposit for the Premises in the amount of Three Thousand Dollars ($3,000) (“Deposit”). The Deposit shall be subject to the terms and conditions contained in Section 3.3 of this Lease.

1.7 Permitted Use. Tenant agrees to use the Premises for the following purpose(s), and for no other purpose: Full Service Restaurant.

1.8 Tenant Improvements. Landlord shall grant to Tenant an allowance of up to One Hundred Five Thousand Dollars ($105,000) (“Tenant Improvement Allowance”) for the construction of improvements, as set forth in the Schedule of Performance in Exhibit “C,” attached hereto and incorporated herein (“Tenant Improvements”), as follows:

A. 30 Percent: Thirty One Thousand Five Hundred Dollars ($31,500) upon the issuance of building permits.

B. 40 Percent: An amount not to exceed Forty Two Thousand Dollars ($42,000) upon receipt by Landlord of “adequate documentation” of Tenant’s expenses for Tenant Improvements, not to be paid more often than monthly.

C. 30 Percent: Thirty One Thousand Five Hundred Dollars ($31,500) upon thirty (30) days of opening, provided all lien releases are in place and are approved by Landlord in its sole and absolute discretion.

As used in subsection B above, “adequate documentation” of Tenant’s expenses for the construction of the Tenant Improvements shall consist of signed invoices and/or receipts from vendors, contractors, and/or subcontractors for services, product, and/or supplies rendered/provided, or to be rendered/provided with respect to the construction of the Tenant Improvements.)

1.9 Prevailing Wages. In making any approved Tenant Improvements, Tenant shall comply with all applicable laws, including prevailing wage laws (California Labor Code Sections 1720 et seq.), and shall defend, indemnify and hold Landlord harmless from and against any and all claims by any third parties, including but not limited to, contractors and subcontractors for prevailing wages.

ARTICLE II
CONDITION OF PREMISES; DELIVERY OF PREMISES

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 348 of 1671 3 limited to the electrical and fire sprinkler systems, security, environmental aspects, seismic and earthquake requirements, and compliance with the Americans with Disabilities Act), and applicable zoning, municipal, county, state and federal laws, ordinances and regulations and any covenants or restrictions of record (collectively “Applicable Laws”) and the present and future suitability of the Premises for Tenant’s intended use; (b) that Tenant has made such investigation as it deems necessary with reference to such matters, is satisfied with reference thereto, and assumes all responsibility therefore as the same relate to Tenant’s occupancy of the Premises and/or the terms of this Lease; and (c) that neither Landlord, nor any of Landlord’s agents, has made any oral or written representations or warranties with respect to said matters other than as set forth in this Lease.

2.2 Delivery of Premises. Landlord agrees to deliver possession of the Premises to Tenant within a reasonable amount of time following the Effective Date. If, despite said efforts, Landlord is unable to deliver possession as agreed, Landlord shall not be subject to any liability therefore, nor shall such failure affect the validity of this Lease. Tenant shall not, however, be obligated to provide Monthly Rent or perform any other obligations under this Lease, until it receives possession of the Premises.

2.3 Landlord Access. Landlord, and its authorized agents, representatives, and employees, may enter the Premises at any time in case of emergency, and otherwise at reasonable hours, with advanced written notice to: (i) inspect the Premises; (ii) exhibit the Premises to prospective purchasers, lenders, insurers or tenants; (iii) determine whether Tenant is complying with all its obligations hereunder; (iii) take possession due to any uncured, material breach of this Lease in the manner provided herein; (iv) perform any covenants of Tenant which Tenant fails to perform; and (v) repair, alter, or improve the Premises or any portion of the Premises, and may for such purposes erect, use and maintain scaffolding, pipes, conduits, and other structures in and through the Premises where reasonably required by the nature of the work to be performed; provided, however, that all such work shall be done as promptly as reasonably possible and so as to cause as little interference with the operation of Tenant’s business as reasonably possible. Tenant hereby waives any claim for damages, including but not limited to interference with business, lost profits, and any other incidental or consequential damages of any sort whatsoever, for any injury or inconvenience to or interference with Tenant’s business, any loss of occupancy or quiet enjoyment of the Premises or any other loss occasioned by such entry.

Landlord shall at all times have and retain a key with which to unlock all of the doors in or about the Premises (excluding Tenant’s vaults, safes, and similar areas designated in writing by Tenant in advance); and Landlord shall have the right to use any and all means which Landlord may

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 349 of 1671 4 deem proper to open said doors in an emergency in order to obtain entry to the Premises, and any entry to the Premises obtained by Landlord by any of said means, or otherwise, shall not under any circumstances be construed or deemed to be a forcible or unlawful entry into or detainer of the Premises or an eviction, actual or constructive, of Tenant from the Premises or any portion thereof. No provision of this Lease shall be construed as obligating Landlord to perform any repairs, alterations, or improvements except as otherwise expressly agreed to be performed by Landlord in this Lease.

2.4 Vehicle Parking. Intentionally Omitted

ARTICLE III
PAYMENT OF MONTHLY RENT; SECURITY DEPOSIT; LATE CHARGES

3.2 Rent Adjustment and Improvements. Intentionally omitted.

3.3 Security Deposit. If Tenant defaults with respect to any provision of this Lease, including but not limited to the provisions related to the payment of Monthly Rent, Landlord may use, apply, or retain all or any part of the Deposit for the payment of rent, any other sum in default, or for the payment of any other amount Landlord may spend or become obligated to spend by reason of Tenant' s default, or to compensate Landlord for any other loss or damage Landlord may suffer by reason of Tenant' s default. If any portion of the Deposit is so used, applied, or retained, Tenant shall with five (5) calendar days after written demand deposit cash with the Landlord in an amount sufficient to restore the Deposit to its original amount. Landlord shall not be required to keep the Deposit separate from its general funds, and Tenant shall not be entitled to any interest earned on the Deposit. The Deposit shall not be deemed a limitation on Landlord' s damages or a payment of liquidated damages or a payment of rent due for the last month of the Term.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 350 of 1671 5 unforeseeable loss or damage caused by the act or omissions of Tenant or Tenant's officers, agents, employees, independent contractors, or otherwise.

ARTICLE IV
USE; COMPLIANCE WITH LAWS; NON-DISCRIMINATION

4.1 Use. The Premises shall be used only for the purposes set forth in Section 1.7 and purposes incidental to that use and in accordance with the General Rules and Regulations attached hereto as Exhibit “B.” Tenant shall use the Premises in a careful, safe, and proper manner and shall not use the Premises for any disreputable business or purpose. Tenant shall not use or permit the Premises to be used or occupied for any purpose or in any manner prohibited by any applicable law, ordinance order, rule, regulation, or other governmental requirement.

4.2 Signs. Any signs to be installed by Tenant shall be subject to the prior written approval of Landlord and shall be installed by a sign contractor approved by Landlord. All

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 351 of 1671 6 required permits for signs shall only be obtained by the approved sign contractor who shall also be responsible for compliance with all applicable codes. Tenant shall be responsible for payment of all sign costs including installation costs, permits and costs to repair the Premises resulting from the installation or removal of such sign.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 352 of 1671 7 B. For the purpose of Section 4.4, the term “Hazardous Materials” shall include, without limitation, substances defined as “hazardous substances,” “hazardous materials,” “toxic substances,” “hazardous wastes,” “extremely hazardous wastes,” or “restricted hazardous wastes,” or stated to be known to cause cancer or reproductive toxicity, under any Environmental Law. Tenant shall not permit to occur any release, generation, manufacture, storage, treatment, transportation, or disposal of any Hazardous Materials. Tenant shall promptly notify Landlord in writing if Tenant has or acquires notice or knowledge that any Hazardous Materials have been or are threatened to be released, discharged, disposed of, transported, or stored on, in, under, or from the Premises; and if any Hazardous Materials are found on the Premises, Tenant, at its sole cost and expense, shall immediately take such action as is necessary to detain the spread of and remove the Hazardous Material to the complete satisfaction of Landlord and the appropriate governmental authorities.

D. If Tenant fails to comply with the forgoing covenants pertaining to Hazardous Materials, Landlord may cause the removal (or other cleanup acceptable to Landlord) of any Hazardous Materials from the Premises. Tenant shall give Landlord, its agents and employees, access to the Premises to remove or otherwise cleanup any Hazardous materials.

Landlord, however, has no affirmative obligation to remove or otherwise cleanup any Hazardous Materials, and this Lease shall not be construed as creating any such obligation.

E. For any Hazardous Material brought on site due to Tenant’s occupancy, Tenant shall indemnify, defend (with counsel reasonably acceptable to Landlord and at Tenant’s sole cost), and hold Landlord and Landlord’s elected and appointed officials, officers, employees, agents, successors and assigns free and harmless from and against all losses, liabilities, obligations, penalties, claims, litigation, demands, defenses, costs, judgments, suits, proceedings, damages (including consequential damages), disbursements or expenses of any kind (including attorneys’ and experts’ fees and expenses and fees and expenses incurred in investigating, defending or prosecuting any litigation, claim or proceeding) that may at any time be imposed upon, incurred by, or asserted or awarded against Landlord in connection or arising out of: (i) any Hazardous Material on, in, under or affecting all or any portion of the Premises, (ii) any violation or claim of violation of any Environmental Law by Tenant; or (iii) the imposition of any lien for the recovery of costs for environmental cleanup or other response costs relating to the release or threatened release of Hazardous Materials on, in, under or affecting all or any portion of the Premises. Tenant’s indemnification shall survive the expiration and termination of this Lease.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 353 of 1671 8 marital status, age, national origin, or ancestry, in the leasing, use, occupancy, tenure, or enjoyment of the Premises, nor shall the Tenant itself, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy of Tenants, sub-tenants, or vendees in the Premises herein leased.

ARTICLE V

TAXES AND UTILITIES

5.2 Utilities. Tenant shall pay the appropriate suppliers for all water, gas, power, electricity, light, heat, telephone, facsimile, internet, and other utilities and communications services used by Tenant on the Premises during the Term, including the taxes thereon, whether or not the services are billed directly to Tenant. Tenant shall procure, or cause to be procured, without cost to Landlord, any and all necessary permits, licenses, or other authorizations required for the lawful and proper installation and maintenance upon the Premises of wires, pipes, conduits, tubes and other equipment and appliances for use in supplying any of the services to and upon the Premises. Landlord, upon request of Tenant, shall at the sole expense and liability of Tenant, join with Tenant in any application required for obtaining and continuing any of the services.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 354 of 1671 9 ARTICLE VI
INSURANCE; INDEMNIFICATION; WAIVER AND RELEASE

B. A policy or policies of Workers Compensation insurance in the amount required by the State of California.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 355 of 1671 10 E. Plate Glass Insurance: Plate glass insurance covering all plate glass on the Premises at full replacement value; provided that Tenant shall be permitted to self-insure plate glass insurance.

G. Business Interruption Insurance: Commercially reasonable business interruption insurance.

H. Builder’s Risk: To the extent of the initial Tenant Improvements, builder’s risk insurance in a form acceptable to Landlord.

A. Names Landlord and any other entities designated by Landlord as additional insureds under the Commercial General Liability policy; B. Shall not be canceled or altered without thirty (30) calendar day’s prior written notice to Landlord;
C. Insures performance of Tenant’s indemnity set forth in this Lease; D. Provide that no act or omissions of Tenant shall affect or limit the obligations of the insurer with respect to other insureds or including Landlord;

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 356 of 1671 11 E. Include all waiver of subrogation rights endorsements necessary to affect the provisions below; and
F. Provide that the commercial general liability policy and the coverage provided shall be primary, that Landlord although an additional insured, shall nevertheless be entitled to recovery under such policy for any damage to Landlord by reasons of acts or omissions of Tenant, and that coverage carried by Landlord shall be noncontributory with respect to policies carried by Tenant.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 357 of 1671 12 6.7 Waiver and Release. Tenant waives and releases all claims against Landlord, its employees, and agents with respect to the matters for which Landlord has disclaimed liability pursuant to the provisions of this Lease. In addition, Tenant agrees that Landlord, its elected and appointed officials, employees, agents, successors and assigns shall not be liable for any loss, injury, death, or damage (including consequential damages) to persons, property, or Tenant’s business occasioned by theft; acts of God; public enemy; injunction; riot; strike; insurrection; war; terrorism; court order; order of governmental body or authority; earthquake; fire; explosion; falling objects; water; rain; snow; leak or flow of water, or by dampness or from the breakage, leakage, obstruction, or other defects of the pipes, sprinklers, wires, appliances, plumbing, air conditioning, or light fixtures; or from construction, repair, or alteration of the Premises; or from any acts or omissions of any visitor of the Premises; or from any cause beyond Landlord’s control.

ARTICLE VII
REPAIRS AND MAINTENANCE; ALTERATIONS

7.1 Tenant Obligations. Tenant shall maintain in good condition and repair, the entirety of the Premises (except that portion of Premises to be maintained by Landlord), including the Tenant Improvements and all fixtures, and the HVAC systems. If Tenant fails to make repairs, restorations or replacements, Landlord may make them at the expense of Tenant and the expense shall be collected as additional rent to be paid by Tenant within fifteen (15) calendar days after delivery of a statement for the expense.)

7.2 Alterations. Tenant shall not make any alterations, improvements or additions in, on or about any of the Premises, without first obtaining Landlord’s prior written consent.

B. By notice given to Tenant no less than ninety (90) calendar days prior to the expiration of the Term of this Lease, Landlord may require that any alterations, improvements, or additions in, on or about the Premises be removed by Tenant. In that event, Tenant shall remove the alterations, improvements or additions at Tenant’s sole cost and expense and shall restore the Premises to the condition in which the Premises was before the alterations, improvements, and additions were made, reasonable wear and tear accepted.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 358 of 1671 13 remove same. Failure to remove any such liens within thirty (30) calendar days of written request by Landlord shall constitute a default of this Lease. At its election, but without having any obligation to do so, the Landlord may pay such liens not so removed by the Tenant and the amount expended by Landlord shall be paid by Tenant within fifteen (15) calendar days after delivery of a statement for the expense.

7.4 Landlord Obligations. Landlord shall repair, maintain in good and tenantable condition and replace, as necessary, the roof, exterior walls and structural components of the Premises (including the structural floor) and all meters, pipes, conduits, equipment (excluding heating, ventilation and air conditioning equipment), components and facilities that supply the Premises with utilities (except as the appropriate utility company has assumed these duties); provided however that Landlord shall not be required to make repairs necessitated by reason of any acts or omissions of Tenant, including negligence or willful misconduct of Tenant or anyone claiming under Tenant, by reason of the failure of Tenant to perform or observe any conditions or agreements of this Lease, or by reason of improvements made by Tenant or anyone claiming under Tenant.

ARTICLE VIII
DAMAGE AND DESTRUCTION; CONDEMNATION

8.2 Condemnation. If all or any part of the Premises shall be condemned or taken as a result of the exercise of the power of eminent domain, including any conveyance or assignment in lieu of any condemnation or taking, this Lease shall terminate as to the part so taken as of the date of taking, and in the case of a partial taking, either Landlord or Tenant shall have the right to terminate this Lease as to the balance of the Premises by notice to the other within thirty (30) calendar days after the date of such taking; provided, however, that a condition to the exercise by Tenant of such right to terminate shall be that the portion of the Premises taken shall be of such extent and nature as substantially to handicap, impede or impair Tenant’s use of the balance of the Premises. In any event, Landlord shall be entitled to any and all compensation, damages, income, rent, awards and any interest therein whatsoever which may be paid or made in connection therewith, and Tenant shall have no claim against Landlord for the bonus value of any unexpired Term of this Lease or otherwise; provided, however, that nothing herein shall prevent Tenant from pursuing a separate award against the taking entity, specifically for its relocation expenses or for the taking of any personal property or trade fixtures belonging to

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 359 of 1671 14 Tenant, so long as such separate award to Tenant does not diminish any award otherwise due Landlord as a result of such condemnation or taking.

ARTICLE IX
ASSIGNMENT; SUBLETTING; PROCESSING

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 360 of 1671 15 sublease or assignment whereby the subtenant or assignee shall expressly assume all obligations of Tenant under this Lease as to the portion of the Premises subject to such assignment or sublease. Any purported sublease or assignment will be of no legal force or effect unless and until the proposed sublease has been consented to, in writing, by Landlord and a fully executed copy thereof has been received by Landlord.

ARTICLE X
HOLDING OVER; SALE OF PREMISES; TERMINATION

10.1 No Right to Holdover. Tenant has no right to retain possession of the Premises or any part thereof beyond the expiration or termination of this Lease. If, without objection by Landlord, Tenant holds possession of the Premises after expiration of the Term, Tenant shall become a Tenant from month-to-month upon the terms herein specified, except that the monthly rent shall equal to one hundred and fifty percent (150%) of the monthly rent payable by Tenant at the expiration of the Term. In addition, Tenant shall continue to pay all other amounts due to Landlord hereunder. Each Party shall give the other notice at least one (1) month prior to the date of termination of such monthly tenancy of its intention to terminate such tenancy. If, after objection by Landlord thereto, Tenant holds possession of the Premises after expiration of the Term, Tenant shall constitute a Tenant at sufferance and without in any way waiving the

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 361 of 1671 16 wrongful holding over of the Premises by Tenant, Landlord shall be entitled to receive for each month or portion thereof during which Tenant wrongfully holds over at the Premises monthly rent equal to two hundred percent (200%) of the monthly rent payable by Tenant at the expiration of the Term together with all other amounts otherwise due to Landlord hereunder.

10.3 Early Termination of Tenancy. Intentionally Omitted

10.4 No Relocation Assistance. Tenant acknowledges that Tenant may be displaced from the Premises, but Tenant hereby agrees that Landlord shall have no obligation to Tenant under the California Relocation Assistance and Real Premises Acquisition statutes and guidelines. Tenant, after diligent review and consideration of possible impacts, hereby waives and forever releases Landlord, including its successors, officers, employees, attorneys, agents, representatives and anyone else acting on Landlord’s behalf, of and from any and all claims, demands, actions or causes of action, obligations, liabilities, or claims for further compensation, known or unknown, based upon or relating to the California Relocation Assistance and Real Premises Acquisition statutes and guidelines and Landlord’s subsequent use and development of the Premises, or Tenant’s displacement therefrom. By such release, Tenant expressly waives its rights pursuant to California Civil Code Section 1542 which provides: “A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.”

ARTICLE XI
SUBORDINATION; ESTOPPEL CERTIFICATES

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 362 of 1671 17 irrevocably appoints Landlord as its agent and attorney-in-fact to execute, acknowledge, and deliver any such instruments in the name of and on behalf of Tenant if Tenant fails to so execute, acknowledge and deliver such instruments within ten (10) calendar days after written request therefore.

ARTICLE XII
DEFAULT; REMEDIES; DISPUTE RESOLUTION

12.1 Default; Breach.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 363 of 1671 18 located at the Premises or of Tenant’s interest in this Lease, where possession is not restored to Tenant within thirty (30) days; or (iv) the attachment, execution, or other judicial seizure of substantially all of Tenant’s assets located at the Premises or of Tenant’s interest in this Lease, where such seizure is not discharged within thirty (30) days; provided, however, in the event that any provision of this Subparagraph 12.1(A)(6) is contrary to any applicable law, such provision shall be of no force or effect, and shall not affect the validity of the remaining provisions. (7) Failure of Tenant to fulfill any obligation under this Lease which endangers or threatens life or property, where such failure continues for a period of one (1) calendar day following written notice thereof by or on behalf of Landlord to Tenant. (8) Tenant making or furnishing any warranty, representation, or statement to Landlord in connection with this Lease, or any other agreement made by Tenant for the benefit of Landlord, which is or was false or misleading in any material respect when made or furnished. (9) Assignment or sublease of this Lease or any portion of the Premises, or attempt to assign or sublease this Lease or any portion of the Premises, by Tenant in violation of Section 9.1.
(10) Tenant committing waste on the Premises.
(11) Failure of Tenant to timely complete the Tenant Improvements in accordance with Exhibit “C.”
(12) Failure of Tenant to otherwise perform, satisfy, or abide by any of the terms, covenants, conditions, or provisions of this Lease.

A. If Landlord chooses to repossess the Premises, then this Lease will automatically terminate in accordance with the provisions of California Civil Code Section 1951.

In the event of such termination of the Lease, Landlord may recover from Tenant:

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 364 of 1671 19 (1) The worth at the time of award of the unpaid rent which had been earned at the time of termination, including interest at the maximum rate allowed by law;
(2) The worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of the award exceeds the amount of such rental loss that Tenant proves could have been reasonably avoided, including interest at the maximum rate allowed by law; (3) The worth at the time of award of the amount by which the unpaid rent for the balance of the Term after the time of award exceeds the amount of such rental loss that Tenant proves could be reasonably avoided; and (4) Any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant' s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 365 of 1671 20 shall pay to Landlord, in addition to the remaining rent due, all costs which Landlord incurred in re-letting, including without limitation maintenance, that remain after applying the rent received from the re-letting, as provided in Section 12.2.

12.3 Continuation after Breach. Even though Tenant has breached this Lease and/or abandoned the Premises, this Lease shall continue in full force and effect for so long as Landlord does not terminate Tenant’s right to possession as provided in Section 12.2 above, and Landlord may enforce all its rights and remedies under this Lease. In such event, Landlord may exercise all of the rights and remedies of a Landlord under California Civil Code Section 1951.4, or any successor statute. Acts of maintenance or preservation or efforts to re-let the Premises or the appointment of a receiver upon initiative of Landlord to protect Landlord’s interest under this Lease shall not constitute a termination of Tenant’s right to possession.

ARTICLE XIII

GENERAL PROVISIONS

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 366 of 1671 21 13.2 Notice. All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered or sent by registered or certified mail, return receipt requested, telegraphed, delivered or sent by telex, telecopy or cable and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if mailed, three (3) business calendar days after the date of posting by the United States post office, (iii) if given by telegraph or cable, one (1) business calendar day after the date delivered to the telegraph company with charges prepaid.

To Landlord: To Tenant:

City of Indio Woo Hospitality, LLC
100 Civic Center Mall 30326 Avenida Maravilla
Indio, CA 92201 Cathedral City, CA 92234
Attn: City Manager Attn: Gabriel Woo

13.4 Counterparts. This Lease may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute one and the same instrument.

13.6 Amendment of Agreement. The terms of this Lease may not be modified or amended except by an instrument in writing executed by each of the Parties hereto.

13.7 Waiver. The waiver by Landlord or Tenant of any agreement, condition, or provision herein contained shall not be deemed to be a waiver of any subsequent breach of the

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 367 of 1671 22 same or any other agreement, condition or provision herein contained, nor shall any custom or practice which may grow up between the Parties in the administration of the terms hereof be construed to waive or to lessen the right of Landlord or Tenant to insist upon the performance by Tenant or Landlord in strict accordance with said terms. The subsequent acceptance of any payment hereunder by Landlord shall not be deemed to be a waiver of any breach by Tenant of any agreement, condition or provision of this Lease, other than the failure of Tenant to pay the particular amount so accepted. Specifically, Landlord may accept any payment from Tenant and apply same to any amount owing hereunder notwithstanding any stated intent or instruction on the part of Tenant to the contrary and without waiving or compromising any claim that such payment was less than the payment actually due from Tenant.

13.9 Applicable Law. This Lease shall be governed by and construed in accordance with the laws of the State of California.

13.13 Incorporation of Exhibits. Each of the Exhibits to this Lease are incorporated by reference as though fully set forth herein.

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 368 of 1671 IN WITNESS WHEREOF, the Parties hereto have executed this Lease as of the calendar day and year written below.

LANDLORD:

CITY OF INDIO, a California
municipal corporation
By: ____________________________
Bryan H. Montgomery
City Manager

Date: __________________________
ATTEST:

By: _____________________________
Sabdi Sanchez
City Clerk

Date: ___________________________
APPROVED AS TO FORM:

By: ____________________________
Steven Graham
City Attorney
TENANT:

WOO HOSPITALITY, LLC, a California
Limited Liability Corporation
By: ____________________________
Gabriel Woo
President
Date: ___________________________

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 369 of 1671 2 EXHIBIT “A”
Premises/Lease Plan

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 370 of 1671 3 EXHIBIT “B”
General Rules and Regulations

1. Business shall operate at a minimum of six (6) days per week and six (6) hours per day.

2. All floor areas of the Premises (including vestibules, entrances and air returns), doors, fixtures, windows, and plate glass shall be maintained by Tenant, in a clean, safe and good condition.

In the event that any tenant shall fail to remedy such a health or fire hazard or nuisance within five (5) days after written notice by Landlord, Landlord may remedy and/or correct such health or fire hazard or nuisance at the expense of Tenant. Tenant must obtain a separate temporary dumpster to receive its move-in merchandising debris, and construction debris from any tenant improvements or alterations. Should it be necessary for Landlord to have Tenant's solid or liquid rubbish cleaned up, the cost for such cleaning shall be charged back to Tenant along with an administrative fee of fifteen per cent (15%).

4. No portion of the Premises shall be used for lodging purposes. No cooking is allowed on the Premises unless Tenant is a restaurant.

5. No public telephone, newsstand, shoeshine stand, refreshment, vending or other coin operated machine shall be installed or placed on the sidewalk or walkway area adjacent to the Premises or on the Common Facilities without Landlord's prior written approval in each instance. No public telephones are allowed within or outside of the Premises (other than Landlord provided public telephones).

6. No person or persons shall use the Premises, or any part thereof, for conducting therein a second-hand store, auction, distress or fire sale or bankruptcy sale, or "going out of business" sale or "lost our lease" sale, without Landlord's prior written consent in each instance.

7. No portion of the Premises shall be used for the storage of any merchandise, materials or other properties, other than those reasonably necessary for the operation of Tenant's business. Landlord may, from time to time, inspect the Premises to ensure compliance with the foregoing provisions.

8. No display areas of the Premises shall be left vacant, and Tenant shall not black out or otherwise obstruct the windows of the Premises, without Landlord's prior written consent.

Signs in the windows may be limited and must be approved by the Landlord in writing.

9. Landlord shall have the absolute right to enter upon the Premises to perform such cleaning and clearing of the pipes and drains servicing the Premises (including roto-rooter service),

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 371 of 1671 4 and any grease traps and exhaust systems servicing the Premises, as Landlord shall deem necessary.

10. If Tenant shall operate a carry-out food operation, including food and/or soft drink vending machines as well as any ice cream store, Tenant shall pay Landlord for all sidewalk and walkway cleanup work (including without limitation steam cleaning), that Landlord shall determine is necessary to preserve the sanitation, cleanliness and clean appearance of the Center. Tenant shall pay Landlord on an estimated month basis, adjusted annually, and will be responsible for a cleanup of not less than one hundred feet (100') in radius from the entrance(s) to the Premises.

11. If Tenant provides its customers with the use of shopping carts and/or baskets, Tenant shall be responsible for causing said carts and/or baskets to be stored only in areas designated by Landlord. If Tenant fails to routinely collect and store said carts as necessary (at least twice on a daily basis), Landlord may assume the responsibility of same and may bill Tenant on an estimated monthly basis for such service.

12. The exits and entrances shall not be obstructed by Tenant or used by it for any purpose other than for ingress to and egress from the Premises.

15. Except as to normal pictures and furnishings, Tenant shall not mark, drive nails, screw or drill into the partitions, woodwork or plaster or in any way deface the Premises or any part thereof. No boring, cutting or stringing of wires shall be permitted except with the prior written consent of Landlord and as Landlord may direct. Tenant shall not lay linoleum tile, carpet or other similar floor covering so that the same shall be affixed to the floor of the Premises in any manner except as approved by Landlord. The expense of repairing any damage resulting from a violation of this rule or removal of any floor covering shall be borne by Tenant.

16. Tenant shall not use, keep or permit to be used or kept, any noxious gas or substance in the Premises, or permit or suffer the Premises to be occupied or used in a manner offensive or objectionable to Landlord or other occupants of the Premises by reason of noise, odors, and/or vibrations, or interfere in any way with other tenants or those having business therein. Tenant shall not make or permit to be made any loud or disturbing noises or disturb or interfere with neighbors’ use and enjoyment of their property, whether by the use of any

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 372 of 1671 5 musical instrument, radio, television, video or audio recording, shouting, or in any other manner. Tenant shall not throw anything out of doors.

17. Tenant shall not use or keep in the Premises any kerosene, gasoline or flammable or combustible fluid or material, or use any method of heating or air conditioning other than that supplied or permitted by Landlord.

18. Landlord will direct electricians as to where and how electrical, telephone, television and cable wires are to be introduced to the Premises. No boring or cutting for wires will be allowed without the prior consent of Landlord. The location of telephone call boxes and other office equipment in the Premises shall be subject to the approval of Landlord. All such consents and approvals by the Landlord must be in writing.

19. Tenant shall be responsible for assuring that doors to the Premises are not left unlocked during non-business hours, except while moving furniture or other items in or out of the Premises.

20. Landlord reserves the right to exclude or expel from the Premises any person who, in the judgment of Landlord, is intoxicated or under the influence of liquor or drugs, or is violating the rules and regulations of the Premises.

21. The requirements of Tenant will be attended to only upon application to Landlord’s designated property manager. Employees of Landlord shall have no obligation to perform any work for Tenant or do anything outside their regular duties for Tenant unless under special instructions from Landlord, and no employee shall have any obligation to admit any person (Tenant or otherwise) to any office of Landlord without specific instruction from Landlord.]

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 373 of 1671 6 EXHIBIT “C”
Schedule of Performance
To be provided before Lease Agreement is executed

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Approval of a Commercial Lease Agreement with Woo Hospitality, LLC locat... Page 374 of 1671 City of Indio
City Council
July 17, 2024

STAFF REPORT
To: City Council
From: Bryan H. Montgomery, City Manager
Prepared by: Carl S. Morgan, Dir. Of Economic Development Subject: Approval of Development Impact Fee "DIF" Deferral Agreement with Indio Towne Center I, LLC for a new retail building for a total amount of $221,961.06
RECOMMENDATION:

Approval of the Development Impact Fee (DIF) Deferral Agreement with Indio Towne Center I, LLC for the construction of a new retail building for a total amount of $221,961.06; 2) Authorize the City Manager and the City Attorney to execute the Deferral Agreement.

SUMMARY:

Deferral of City Development Impact Fees (DIFs) in the amount of $221,961.06 between the City of Indio and Indio Towne I, LLC for the construction of a new 14,161 sq. ft. retail building within the Indio Towne Center and next to Ulta retail store.

BACKGROUND INFORMATION:

On February 15, 2023, the Indio City Council adopted Resolution No. 10343, which established the Development Impact Fee Deferral Program (Deferral Program). The aim of the program is to promote the development of commercial, industrial, and multi-family projects in order to maintain the City's momentum. The Deferral Program in the City of Indio seeks to stimulate economic growth and job creation by deferring development impact fees for qualifying commercial, industrial, and multifamily projects.

Project Description:

Indio Towne I, LLC has submitted an application for a Development Impact Fee Deferral Agreement, totaling $221,961.06, to support the construction of a 14,161 sq. ft. building within the Indio Towne Center, adjacent to the Ulta retail store. The building will house two tenants: Sketchers and Tilly's retail stores. This ground-up project will encompass a total of 14,161 square feet (7,851 sq. ft. for Sketchers and 6,310 for Tilly's). The project parcel is zoned as Regional Commercial (RC) and in accordance with figure 2.04.01-2 of the Unified Development Code, this square footage size allows for general retail in RC zones. The total DIF amount is approximately $221,961.06 and the proposed addresses for these two retailers are 42300 and 42350 Jackson St.

To be eligible for the Development Impact Fee Deferral Program, projects must meet the following criteria:

AGENDA ITEM #8.15
Approval of Development Impact Fee "DIF" Deferral Agreement with Indio T... Page 375 of 1671

1. JOB CREATION: The commercial or industrial project must create a minimum of 10 fulltime jobs that will be in place for a minimum of 24 months and make good-faith efforts in hiring residents of the City of Indio.

2. SALES TAX GENERATING: The commercial or industrial project will generate a minimum sales tax and Measure X revenues of $25,000, or greater, annually during the Deferral Period.

3. HOUSING UNITS: If a multi-family project, a minimum of 14 units per acre Indio Towne Center I, LLC acknowledges the requirements of this DIF Deferral Agreement and understands that fees are due within three (3) years.

FINANCIAL SUMMARY:

Current FY Financial
Impact:
0 In current year budget: N/A
Current FY General
Fund Impact:
0 Budget adjustment: N/A
Next FY Financial
Impact:
0 Strategic Objective: Business & Job Growth
Source of funds: N/A Fund-Org-Object
Reference:

Additional Financial Details:

Approval for the Deferral Agreement with Indio Towne Center I, LLC will have no direct impact on the budget. This agreement will defer payment of impact fees for three (3) years and does not waive fees.

ATTACHMENTS:

Attachment 1: DIF Deferral AGMT- Indio Towne I, LLC
APPROVAL(S):

Carl S. Morgan, Dir. Of Economic Development Approved - 05 Jul 2024 Steven Graham Pacifico, City Attorney Approved - 09 Jul 2024 Ruby D. Walla, Director of Finance Approved - 09 Jul 2024 Bryan H. Montgomery, City Manager Approved - 10 Jul 2024

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RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:

CITY OF INDIO

CITY CLERK
100 CIVIC CENTER MALL
INDIO, CA 92201
______________________________________________________________________ Space above this line for Recorder’s Use Exempt from Fees Per Gov. Code § 6103 DEVELOPMENT IMPACT FEE “DIF”

DEFERRAL AGREEMENT
By and Between
City of Indio,
a municipal corporation
and
Indio Towne Center I, LLC
(“Owner”)
July 17, 2024
Riverside County, California

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DEVELOPMENT IMPACT FEE DEFERRAL AGREEMENT
This Development Impact Fee Deferral Agreement (the “Agreement”) is made and entered into by and between the City of Indio, a California municipal corporation (“City”) and Indio Towne Center I, LLC (“Owner”), collectively, the (“Parties”) with reference to the following facts:

RECITALS
A. The recording of this document is for the benefit of the City to secure Owner’s payment of Development Impact Fees (“DIF”).

B. Owner is the owner of that certain real property in the City of Indio, County of Riverside, State of California, more particularly described on the attached Exhibit “A” (the “Property”).

C. Owner has requested the deferral of DIF associated with the development of the Property in the total amount of $ 221,961.06.

D. The DIF applicable for deferral is more particularly described on Exhibit “B” attached hereto and incorporated herein (“Deferred Fees”).

E. Pursuant to the City’s DIF Deferral Program, the City Manager may defer the payment of certain DIF for a maximum period of three (3) years from the issuance of the certificate of occupancy for the Property (“Certificate of Occupancy”).

F. As a condition to the deferral, the City requires the Owner to execute and record this Agreement, which provides that the Deferred Fees shall be paid within the time set forth in Section 3 and be secured by a lien on the Property.

AGREEMENT
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:

1. Incorporation. All the above recitals are true and correct and are fully incorporated into this Agreement by reference and made a part hereof.

2. Effective Date. This Agreement shall be effective upon the date it is executed by the City Manager (“Effective Date”).

3. Deferral. City agrees to defer collection of the payment of Deferred Fees for a maximum period of three (3) years from the issuance of the Certificate of Occupancy. Owner, on behalf of itself and its successors and assigns, agrees to pay the Deferred Fees with a cashiers/certified check, or by other means approved by the City, within three (3) years from the date of issuance of the Certificate of Occupancy (“Due Date”). This Agreement shall be null and void and the Deferred Fees immediately due and payable if the Owner does not apply for and diligently take all reasonable actions to obtain a Certificate of Occupancy within six (6) months or if Owner fails to begin operating the business described on the application (attached hereto as Exhibit C) within two (2) years. The Owner shall be required to provide, at its sole expense, a surety bond or other security satisfactory to the City

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Approval of Development Impact Fee "DIF" Deferral Agreement with Indio T... Page 378 of 1671 Manager, in the full amount of the Deferred Fees for the entire time period the fees are deferred.

4. Amount Payable. At the time the Deferred Fees become payable, the amount of Deferred Fees owed shall be determined by the DIF rate for the year in which the Deferred Fees are actually paid.

5. Related Costs and Interest. If the Owner does not pay the Deferred Fees in full by the Due Date, the Owner shall be obligated to pay all expenses the City incurs to collect any past-due amounts, including but not limited to costs for City staff time, third-party costs, reasonable attorneys’ fees, and litigation costs (“Related Costs”). Moreover, any amount not paid by the Due Date shall be subject to interest at the annual rate of 5% (“Interest”) until the Deferred Fees, including Related Costs, are paid in full.

6. Lien. This Agreement shall be recorded against the Property in the Office of the Riverside County Recorder and shall constitute a lien for the payment of the Deferred Fees, binding upon, and running with, the Property. If all or any portion of the Property is sold, the Owner or any successor in interest shall ensure the inclusion of an escrow instruction providing for payment of the Deferred Fees, Related Costs, and Interest, out of escrow from sale proceeds, prior to disbursing proceeds to the Owner or successor in interest. The debt for the Deferred Fees shall only be deemed satisfied and discharged when the Deferred Fees and (if applicable) Related Costs and Interest are paid in full to the City. The Property shall not otherwise be released of any obligations under this Agreement until the entire amount owing is paid in full. This Agreement shall be binding upon, and the benefits of this Agreement shall inure to, the Parties and all successors in interest to the Parties.

7. Remedies. Parties acknowledge that the City will have already issued building permits, other entitlements, and the Certificate of Occupancy by the time the Deferred Fees become due and owing and that the City’s willingness to issue such permits and entitlements without first receiving payment for DIF is based on the Owner’s irrevocable agreement herein to pay the Deferred Fees by the Due Date. If the Owner fails to pay the Deferred Fees by the Due Date, the City reserves the right to revoke, suspend, terminate, or otherwise void any permit, license, and/or entitlement issued in connection with the Property, including but not limited to the Certificate of Occupancy, use permits, and business licenses, without any pre- and/or post-deprivation hearing. In addition to the other remedies that may be available to the City in law or equity for breach of this Agreement, if the Owner fails to pay the Deferred Fees by the Due Date, the City may pursue collection through all available legal and administrative means including but not limited to foreclosure of this recorded lien and/or civil judgment against the Owner for breach of this Agreement. The rights and remedies of the City provided in this section shall be cumulative, not exclusive, and are in addition to any other rights or remedies provided by law.

8. No Waiver. The acceptance by the City of any sum in an amount less than the sum then due shall not constitute a waiver of the obligation of the Owner to pay the entire sum then due. Until the entire amount owing is paid, the City shall at all times be entitled to exercise all the remedies herein conferred. No delay or omission of the City in the exercising of any right or power herein shall impair such right or power, or any other right or power, nor shall it be construed as a waiver.

9. Authority. The person signing on behalf of the Owner certifies that s/he can legally bind the

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Approval of Development Impact Fee "DIF" Deferral Agreement with Indio T... Page 379 of 1671 Owner and agrees to hold the City harmless if it is later determined that such authority does not exist.

10. Indemnification. Owner agrees to indemnify, defend and hold harmless the City and its officials, officers, agents, and employees for any claims, causes of action or damages/costs arising from the City's deferral of DIF pursuant to this Agreement.

11. Protest. Pursuant to Government Code Section 66020(d), notice is given that the ninety-day period in which the Owner may protest the imposition of DIF identified in Exhibit “B” begins as of the Effective Date, unless the DIF were imposed at an earlier time, in which case, the ninety-day period begins at the earlier time.

12. Severability. In the event any provision of this Agreement is held to be unenforceable in any respect, such unenforceability shall not affect any other provision of this Agreement.

13. Successors and Assigns. This Agreement inures to the benefit of and binds all parties hereto, their heirs, administrators, legal representatives, successors, and assigns.

14. Governing Law and Venue. This Agreement has been executed and delivered in the State of California and is to be construed and enforced according to and governed by the laws thereof. Any action at law or in equity brought by either of the Parties hereto for the purpose of enforcing a right or rights provided for by this Agreement shall be tried in the Superior Court of California, County of Riverside, and the parties hereby waive all provisions of law providing for a change of venue in such proceedings to any other county.
(Signatures on Following Page.)

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SIGNATURE PAGE TO DEVELOPMENT IMPACT FEE DEFERRAL AGREEMENT IN WITNESS WHEREOF, the parties hereto have executed this Development Impact Fee Deferral Agreement as of the date below.
"OWNER"
By:_______________________________
Michael H. Mugel
Manager
Date: ___________________
"CITY"

CITY OF INDIO
By: _______________________________
Bryan H. Montgomery
City Manager
Date: ___________________
ATTEST:

By: _______________________________
Cynthia Hernandez, CMC
City Clerk
Date: ___________________
APPROVED AS TO FORM:

By: _______________________________
Steven P. Graham
City Attorney
Date: ___________________

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ACKNOWLEDGEMENT

STATE OF CALIFORNIA )
COUNTY OF ________________________)
On _________________, 20_____, before me, _______________________________________, Date Insert Name and Title of the Officer
personally appeared ____________________________________________________________ Name(s) of Signer(s)
_____________________________________________________________________________, who proved to me on the basis of satisfactory evidence to be the person whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity, and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws
of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature________________________________
Signature of Notary Public
Place Notary Seal Above
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

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ACKNOWLEDGEMENT

I certify under PENALTY OF PERJURY under the laws
of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

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Approval of Development Impact Fee "DIF" Deferral Agreement with Indio T... Page 383 of 1671 Exhibit “A”
Legal Description

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF INDIO IN THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AND IS DESCRIPTION AS FOLLOWS:

PARCEL 8 OF PARCEL MAP NO. 37813, IN THE CITY OF INDIO, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AS PER MAP FILED IN BOOK 249, PAGES 98 THROUGH 104

INCLUSIDE OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDERS OF SAID COUNTY.

APN: 692-050-036

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Approval of Development Impact Fee "DIF" Deferral Agreement with Indio T... Page 384 of 1671 Exhibit “B”
Permits/Buildings
Subject to DIF Deferral (1)
Tract/Parcel Number(s) Lot/Phase Number(s) Developer Building Type Units Parcel 8 of P.M. 37813 N.A. ITC I,
LLC
Commercial 2
DIF Deferred for Above-Stated Permits/Buildings:

DIF Amount(2)
Permit No. BLDC-23-0014 $221,961.06
(1) The deferred DIF shall become due and payable on the date that is three [3] years following the issuance of the Certificate of Occupancy.
(2) The determination of the DIF shall be the DIF in effect at the time of payment, and not at the time of building permit issuance. Deferred fees are subject to change due to modifications in the DIF Program and application of DIF Credits.

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Application

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Approval of Development Impact Fee "DIF" Deferral Agreement with Indio T... Page 386 of 1671 City of Indio
City Council
July 17, 2024

STAFF REPORT
To: City Council
From: Bryan H. Montgomery, City Manager
Prepared by: Kevin H. Snyder, Dir. Of Community Development Subject: Second Reading of Ordinance No. 1814: Text Amendments to Section

2.04/Figure 2.04.02 and Section 4.19 of the Unified Development Code Establishing as Prohibited Land Uses within the Municipal Limits of the City of Indio Regulated by the Unified Development Code New Indoor/Outdoor Mini-Storage, Self-Storage and Recreational Vehicle Storage Facilities RECOMMENDATION:

Approve Second Reading of Ordinance No. 1814 amending the City of Indio Unified Development Code to establish as prohibited land uses within the municipal limits of the City of Indio regulated by the Unified Development Code new indoor/outdoor mini-storage, self-storage and recreational vehicle storage facilities
SUMMARY:

Text Amendments to Section 2.04/Figure 2.04.02 and Section 4.19 of the Unified Development Code Establishing as Prohibited Land Uses within the Municipal Limits of the City of Indio Regulated by the Unified Development Code New Indoor/Outdoor Mini-Storage, Self-Storage and Recreational Vehicle Storage Facilities
BACKGROUND INFORMATION:

Overview:

On December 12, 2022, the Indio Planning Commission requested the Community Development Department to research and present findings on indoor/outdoor mini-storage also known as selfstorage or mini-storage facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities.

The Planning Commission specifically requested that the Community Development Department provide information on the current number of permitted storage facilities in the City, the number of facilities that have been entitled but not constructed, the number of inquiries within the last year regarding these types of facilities and the number of facilities bordering the City of Indio in the Cities of Coachella, La Quinta, Palm Desert, and unincorporated Bermuda Dunes.

On January 11, 2023, the Community Development Department presented the results of the requested research inclusive of the presence of thirteen (13) existing and active facilities in the City; a total of four (4) pending additional facilities currently going through the City’s land use entitlement approval processes, a total of three (3) facilities that have received land use entitlement approvals and are pending required engineering or building approvals, the receipt of nine (9) inquiries regarding potential additional storage facilities within the City during 2022; the current market focus AGENDA ITEM #8.16
Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 387 of 1671 on the City for these types of facilities and the limited number of current facilities outside the City inclusive of two (2) facilities in the City of Coachella, three (3) facilities in the City of La Quinta, three (3) facilities in the City of Palm Desert and one (1) facility in unincorporated Bermuda Dunes, the limited economic benefit of such facilities in terms of property tax generation, sales tax generation and employment generation and the current limited supply of light industrial and heavily industrial zoned lands within the City and the potential loss of future economic opportunity for the City through the continued absorption and utilization of this limited land supply for self-storage facilities, ministorage facilities and recreational vehicle storage facilities. The Community Development Department at the Planning Commission’s February 8, 2023 regular meeting presented different options for the Planning Commission to recommend to the City Council inclusive of: a) Option 1 - Commission take no actions and no changes are made to current zoning regulations for indoor/outdoor mini-storage (also known as self-storage) facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities within the municipal limits of the City of Indio; b) Option 2 - Commission take no action and direct staff to prepare additional information for future discussion on topics identified by the Planning Commission regarding current zoning regulations for indoor/outdoor self-storage or mini-storage facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities within the municipal limits of the City of Indio; c) Option 3 - Commission recommend to the City Council that there be amendments to the City's Unified Development Code to prohibit new indoor/outdoor self-storage or mini-storage facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities within the municipal limits of the City of Indio; d) Option 4 - Commission recommend to the City Council that there be amendments to the City's Unified Development Code to Amend to limit the number or location or concentration of indoor/outdoor self-storage or ministorage facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities within the municipal limits of the City of Indio; e) Option 5 - Commission recommend to the City Council the adoption of a moratorium consistent with statutory provisions to allow the Council, Commission and staff further time to analyze the regulation of indoor/outdoor mini-storage (also known as selfstorage) facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities within the municipal limits of the City of Indio while not allowing any new applications for these facilities during the effective period of the moratorium. At the conclusion of its discussion on February 8, the Planning Commission on a 5-0 motion vote recommended to the City Council the adoption of a moratorium consistent with statutory provisions; and,
California Government Code Section 65858.a specifies the provisions under which a legislative body can enact a moratorium on the use, construction, establishment or operation of certain land uses when the legislative body believes there is a threat to the public health, safety and welfare of a community. Specifically this Section states: "Without following the procedures otherwise required prior to the adoption of a zoning ordinance, the legislative body of a county, city, including a charter city, or city and county, to protect the public safety, health, and welfare, may adopt as an urgency measure an interim ordinance prohibiting any uses that may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the legislative body, planning commission or the planning department is considering or studying or intends to study within a reasonable time. That urgency measure shall require a four-fifths vote of the legislative body for adoption. The interim ordinance shall be of no further force and effect 45 days from its date of adoption. After notice pursuant to Section 65090 and public hearing, the legislative body may extend the interim ordinance for 10 months and 15 days and subsequently extend the interim ordinance for one year. Any extension shall also require a four-fifths vote for adoption. Not more than two extensions may be adopted”.

On March 15, 2023, the City Council conducted a public hearing and approved Citywide Urgency Ordinance No. 1791 adopting an interim measure imposing a moratorium on the use, construction, establishment or operation of new self-storage facilities, mini-storage facilities and recreational

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 388 of 1671 vehicle storage facilities within the City of Indio. On April 19, 2023, the City Council conducted a public hearing and approved Citywide Urgency Ordinance No. 1793 extending an interim measure imposing a moratorium on the use, construction, establishment or operation of new self-storage facilities, mini-storage facilities and recreational vehicle storage facilities within the City of Indio; and, Subsequent to the City Council’s approval of Citywide Urgency Ordinance No. 1793, the Community Development Department conducted a community survey regarding the regulation of storage facilities and also held an industry and interested parties stakeholder meeting on February 5, 2024.

On March 6, 2024, the City Council conducted a public hearing and approved Citywide Urgency Ordinance No. 1810 to authorize the extension to July 1, 2024 of citywide Urgency Ordinance No. 1793, an interim measure imposing a moratorium on the use, construction, establishment or operation of new self-storage facilities, mini-storage facilities and recreational vehicle storage facilities within the City of Indio.

On April 10, 2024, the Planning Commission conducted a public study session during a regularly scheduled meeting to review and discuss potential policy alternatives for the regulation of selfstorage/mini-storage facilities and recreational vehicle storage facilities in the City of Indio with these alternatives consisting of Policy Alternative No. 1 – No Change Alternative, Policy Alternative No. 2 – Enhanced Design Requirements, Policy Alternative No. 3 – Prohibition on New Uses, Policy Alternative No. 4 – Limitation on Total Number within City, Policy Alternative No. 5 – Location on Unique, Odd-Shaped or Physically Constrained Parcels, Policy Alternative No. 6 – Location Limitations for Facilities and Policy Alternative No. 7: Limitation To Interior Only/Two-Story Designs.

At the conclusion of its review and discussion on April 10, 2024, the Planning Commission provided consensus direction on a hybrid policy alternative for storage facilities consisting of Policy Alternative #4 (Limitation on Total Number within City) plus Policy Alternative #6 (Location Limitations for Facilities) plus Policy Alternative #2 (Enhanced Design Standards).

On April 24, 2024, the Planning Commission conducted a public study session during a regularly scheduled meeting to review and discuss the Community Development Department’s analysis of the aforementioned hybrid alternative. At the conclusion of its discussion on April 24, 2024, the Planning Commission provided consensus direction on the establishment of new storage facilities as prohibited land uses within the municipal limits of the City together with consensus direction that any recommendation to the City Council for this prohibition should include a five (5) year review with possible action from the effective date of the City Council’s action on the Planning Commission’s recommendation.

On May 8, 2024, the Planning Commission conducted a noticed public hearing with four out of the five Commissioners in attendance. The Commission received two public comments. The commentators requested that the Commission not recommend prohibition of storage facilities to the City Council. Following the close of the public hearing and deliberation, the Planning Commission unanimously recommended to the City Council the prohibition of new indoor/outdoor self-storage or mini-storage facilities and indoor/outdoor recreational vehicle (RV) storage facilities.

California Environmental Quality Act (CEQA) Findings:

The City of Indio Community Development Department, acting as Lead Agency, determined that Section 15061 (Review for Exemption) of Title 14 of the California Code of Regulations and more specifically (b)(3) of this Section was applicable to the proposed text amendments. Section 15061(b)(3) specifies that a lead agency may determine that an activity is covered by the commonsense exemption of the California Environmental Quality Act (CEQA) where it can be seen

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 389 of 1671 with certainty that there is no possibility that the activity (ies) in question may have a significant effect on the environment, then the activity (ies) is not subject to CEQA.

Public Notice:

A notice of a public hearing for the Planning Commission’s consideration of the requested text amendments was published in the April 28, 2024 edition of the Desert Sun, a newspaper of record as well as notice was provided to interested parties.

A notice of a public hearing for the City Council’s consideration of the Planning Commission’s recommendation for the requested text amendments was published in the June 5, 2024 edition of the Desert Sun, a newspaper of record as welk as notice was provided to interested parties Land Use Findings:

Section 6.06.01 (Amendments to the General Plan, Development Code and Zoning Map) of the City of Indio Unified Development Code
I. Criteria for Zoning Amendments.

1. The amendment is consistent with the General Plan;
Goal LU-1: Citywide Urban Structure. An urban structure that enhances the quality of life of residents, meets the community’s vision for the future, and weaves new growth areas together with established Indio neighborhoods.
o Maintaining the I-10 Employment Corridor subarea as a critical economic engine for the City.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There are a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040.

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 390 of 1671 Goal LU-2: Active Places. Indio is a City with active and comfortable places that encourage social interaction and community gathering.

Policy LU-2.2 Balanced land uses. Maintain a balanced land use pattern to support a broad range of housing choices, retail businesses, employment opportunities, educational and cultural institutions, entertainment spaces, and other supportive uses and within longestablished Indio neighborhoods and new growth areas.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040.

Goal LU-10. Workplace and Employment Districts. Employment-oriented districts provide space for industrial, manufacturing, office, and research and development in order to increase access to jobs and enhance the fiscal stability of the City.

Policy LU-10.2 Emerging industries. Support a diverse mix of light industrial, information, maker, and technology in order to provide jobs and tax revenues for the community by allowing emerging economic uses and industries within the Workplace and Employment designation.

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 391 of 1671 results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040 and more specifically, this Policy. The prohibition of storage facilities within the Specific Plan boundaries will assist in maintaining the City’s industrial land base that will provide the opportunity to support the development of a diverse mix of light industrial, information, maker and technology businesses to provide jobs and tax revenues.

Policy LU-10.3 Flex spaces. Expand the number of flex facilities on land designated as Workplace and Employment to accommodate technology, light manufacturing, and service tenants and diversify the City’s economic base.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The availability of industrial properties that would not be consumed by storage facilities would provide available land base for the development of future flex spaces for technology, light manufacturing and service tenants that would provide local employment opportunities and help diversify the City’s economic base.

Goal ED-1: Vibrant Economy. A vibrant economy that maintains existing businesses and attracts new development.

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 392 of 1671 limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. In order for the City to have a vibrant economy and to be able to attract new industrial oriented development, the City must ensure that its industrial land inventory is maintained and is not given over to land uses that create no or limited jobs and do not substantively contribute to the fiscal health of the City and the community. The prohibition of storage facilities within the Specific Plan boundaries will help maintain the industrial land base within the City assisting the City in its ability to attract new beneficial industrial businesses to support the City’s efforts to create a vibrant and sustainable local economy.

Goal ED-2: Employment Base. A growing employment base with a diversity of job opportunities for current and future residents.

Policy ED-2.1 Business development opportunities. Identify business development opportunities that will increase the number of professional and technical jobs as well as increase skill and wage levels. Emphasis should be placed on development opportunities that diversify the local economy.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta,

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 393 of 1671 Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the Specific Plan boundaries will help maintain the industrial land base within the City assisting the City in its ability to attract businesses that offer professional and technical jobs that will increase skill and wage levels in the City and diversity the City’s economic base.

Policy ED-2.4 Industrial growth. Support the retention and growth of the industrial and manufacturing sector and actively attract new industrial businesses.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the City will help maintain the industrial land base within the Specific Plan boundaries assisting the City in its ability to support the retention and growth of the industrial and manufacturing sector and actively attract new industrial businesses.

Policy ED-2.6 Attract livable wages. Continue to pursue and attract companies and industries who offer livable wages and medical benefits for employees in Indio.

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 394 of 1671 results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the Specific Plan boundaries will help the City in its economic development efforts to pursue and attract companies and industries that would offer livable wages and medical benefits for employees in the City.

Goal ED-3: Workforce Development. A City with a highly educated, skilled, and adaptable workforce that is growing.

Policy ED-3.1 Economic development and labor pool alignment. Align economic development efforts with the labor pool to increase the number of jobs filled by Indio residents.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the Specific Plan boundaries will help maintain the industrial land base within the City assisting the City in its efforts to increase the number of jobs filled by Indio residents through proactive economic development efforts that benefit from a retained industrial land base.

Goal ED-6: Tax Base Diversification. A City with a diversified tax base that allows it to flourish during different market cycles.

Policy ED-6.4 Non-retail taxes. When possible, identify and attract industrial and warehousing/distribution businesses that have substantial business-to-business or other nonretail taxable sales potential.

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 395 of 1671 The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the Specific Plan boundaries will help maintain the industrial land base within the City assisting the City in its ability to attract businesses that offer professional and technical jobs that will increase skill and wage levels in the City and diversity the City’s economic base.

Goal ED-8: Jobs-Housing Balance. A City that grows with a balance of jobs and housing to meet the needs of current and future residents.

Policy ED-8.2 Employment infill. Allow employment generating land uses at infill sites and in development locations.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 396 of 1671 total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the City will eliminate low to no employment generating land uses from the Specific Plan boundaries increasing the available land supply to recruit employment generating land uses to benefit Indio residents.

2. The proposed amendment is internally consistent with other applicable provisions of the Code;
The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. The prohibition of certain land uses is a legal exercise of the City’s police power granted by the state constitution. The practice of prohibiting certain land uses based on land use incompatibility or direct or indirect negative impacts to surrounding properties and area or citywide land use or transportation or economic development is an established legislative practice and has been implemented throughout applicable sections of the Unified Development Code previously adopted by ordinance by the City Council and effective on October 22, 2022.

3. Any change in zone boundaries is consistent with the General Plan and is necessary to achieve the balance of land uses desired by the City; There are no amendments needed or requested for any change in zone boundaries; rather the amendments are textual in nature only. Therefore, this criterion is not applicable.

4. The amendment will promote the growth of the city in an orderly manner and promote and protect the public health, safety, peace, comfort, and general welfare; and The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. There are no other amendments proposed to the Highway 111 Corridor Specific Plan and its rules and regulations would remain in effect and applicable to properties within its boundary. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. Therefore, the text amendments would create community benefits by prohibiting storage facilities within the City and preserving the remaining land base for diverse employment generating land uses.

5. The proposed amendment is in compliance with the provisions of the CEQA.

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 397 of 1671 The City of Indio Community Development Department, acting as Lead Agency, determined that Section 15061 (Review for Exemption) of Title 14 of the California Code of Regulations and more specifically (b)(3) of this Section was applicable to the proposed text amendments.

Section 15061(b)(3) specifies that a lead agency may determine that an activity is covered by the commonsense exemption of the California Environmental Quality Act (CEQA) where it can be seen with certainty that there is no possibility that the activity (ies) in question may have a significant effect on the environment, then the activity (ies) is not subject to CEQA.

ATTACHMENTS:

Attachment1_OrdinanceNo1814_StorageFacilities_UDCTextAmendments Attachment2_PlanningCommissionResolution_No._2090
Attachment3_041024_PlanningCommission_StudySession
Attachment4_042424_PlanningCommissionStudySession_
Attachment5_CommunitySurveyResuls
Attachment6_StorageFacilitiesMap
Attachment7_StorageFaciltiesBackgroundDate
Attachment8_UrgencyOrdinanceNo1791
Attachment9_UrgencyOrdinanceNo1793
Attachment10_UrgencyOrdinanceNo1810
Attachment11_ 05824Planning CommissionPublicComment_1784 Holdings, LLC Attachment12_052824PlanningCommissionPublicComment_BenjaminEgan Attachment13_May82024PlanningCommissionMeetingMinutes

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 398 of 1671 1 ORDINANCE NO. 1814

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF INDIO, CALIFORNIA APPROVING TEXT AMENDMENTS TO SECTION 2.04/FIGURE 2.04.02 AND SECTION 4.19 OF THE UNIFIED DEVELOPMENT CODE ESTABLISHING AS

PROHIBITED LAND USES WITHIN THE MUNICIPAL LIMITS OF THE CITY OF INDIO

REGULATED BY THE UNIFIED DEVELOPMENT CODE NEW INDOOR/OUTDOOR

MINI-STORAGE FACILITIES, SELF-STORAGE FACILITIES AND RECREATIONAL

VEHICLE STORAGE FACILITIES AND MAKING THE DETERMINATION THAT THE

TEXT AMENDMENTS QUALIFY FOR THE COMMONSENSE EXEMPTION

PURSUANT TO THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) GUIDELINES SECTION 15061(B)(3) AS IT CAN BE SEEEN WITH CERTAINTY THAT

THERE IS NO POSSIBILITY THAT THE TEXT AMENDMENTS WILL HAVE A

SIGNIFICANT IMPACT ON THE ENVIRONMENT
WHEREAS, on September 18, 2019, the City Council conducted a public hearing approved Resolution No. 10107 adopting the City of Indio General Plan 2040; and, WHEREAS, on September 18, 2019, the City Council conducted a public hearing and approved Resolution No. 10106 certifying the Final Environmental Impact Report, adopting California Environmental Quality Act (CEQA) Findings and a Mitigation and Monitoring Program; and,
WHEREAS, on August 17, 2022, the City Council conducted a public hearing and approved Ordinance No. 1782 adopting the City of Indio Unified Development Code and associated zoning map that became effective on October 22, 2022; and, WHEREAS, on September 21, 2022, the City Council conducted a public hearing and approved Resolution No. 10326 making a Finding of Consistency with the General Plan 2040 Final Environmental Impact Report for the adoption of the Highway 111 Corridor Specific Plan; and,
WHEREAS, on September 21, 2022, the City Council conducted a public hearing and approved Resolution No. 10325 adopting the Highway 111 Corridor Specific Plan; and,
WHEREAS, on December 12, 2022, the Indio Planning Commission requested the Community Development Department to research and present findings on indoor/outdoor mini-storage also known as self-storage or mini-storage facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities; and,
WHEREAS, the Planning Commission specifically requested that the Community Development Department provide information on the current number of permitted storage facilities in the City, the number of facilities that have been entitled but not constructed, the number of inquiries within the last year regarding these types of facilities and the

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 399 of 1671 2 number of facilities bordering the City of Indio in the Cities of Coachella, La Quinta, Palm Desert, and unincorporated Bermuda Dunes; and,
WHEREAS, on January 11, 2023, the Community Development Department presented the results of the requested research inclusive of the presence of thirteen (13) existing and active facilities in the City; a total of four (4) pending additional facilities currently going through the City’s land use entitlement approval processes, a total of three (3) facilities that have received land use entitlement approvals and are pending required engineering or building approvals, the receipt of nine (9) inquiries regarding potential additional storage facilities within the City during 2022; the current market focus on the City for these types of facilities and the limited number of current facilities outside the City inclusive of two (2) facilities in the City of Coachella, three (3) facilities in the City of La Quinta, three (3) facilities in the City of Palm Desert and one (1) facility in unincorporated Bermuda Dunes, the limited economic benefit of such facilities in terms of property tax generation, sales tax generation and employment generation and the current limited supply of light industrial and heavily industrial zoned lands within the City and the potential loss of future economic opportunity for the City through the continued absorption and utilization of this limited land supply for self-storage facilities, mini-storage facilities and recreational vehicle storage facilities; and,
WHEREAS, the Community Development Department at the Planning Commission’s February 8, 2023 regular meeting presented different options for the Planning Commission to recommend to the City Council inclusive of: a) Option 1 - Commission take no actions and no changes are made to current zoning regulations for indoor/outdoor mini-storage (also known as self-storage) facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities within the municipal limits of the City of Indio; b) Option 2 - Commission take no action and direct staff to prepare additional information for future discussion on topics identified by the Planning Commission regarding current zoning regulations for indoor/outdoor self-storage or mini-storage facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities within the municipal limits of the City of Indio; c) Option 3 - Commission recommend to the City Council that there be amendments to the City's Unified Development Code to prohibit new indoor/outdoor selfstorage or mini-storage facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities within the municipal limits of the City of Indio; d) Option 4 - Commission recommend to the City Council that there be amendments to the City's Unified Development Code to Amend to limit the number or location or concentration of indoor/outdoor self-storage or mini-storage facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities within the municipal limits of the City of Indio; e) Option 5 - Commission recommend to the City Council the adoption of a moratorium consistent with statutory provisions to allow the Council, Commission and staff further time to analyze the regulation of indoor/outdoor mini-storage (also known as self-storage) facilities and/or indoor/outdoor recreational vehicle (RV) storage facilities within the municipal limits of the City of Indio while not allowing any new applications for these facilities during the effective period of the moratorium; and,

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 400 of 1671 3 WHEREAS, at the conclusion of its discussion on February 8, the Planning Commission on a 5-0 motion vote recommended to the City Council the adoption of a moratorium consistent with statutory provisions; and,
WHEREAS, California Government Code Section 65858.a specifies the provisions under which a legislative body can enact a moratorium on the use, construction, establishment or operation of certain land uses when the legislative body believes there is a threat to the public health, safety and welfare of a community. Specifically this Section states: "Without following the procedures otherwise required prior to the adoption of a zoning ordinance, the legislative body of a county, city, including a charter city, or city and county, to protect the public safety, health, and welfare, may adopt as an urgency measure an interim ordinance prohibiting any uses that may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the legislative body, planning commission or the planning department is considering or studying or intends to study within a reasonable time. That urgency measure shall require a four-fifths vote of the legislative body for adoption. The interim ordinance shall be of no further force and effect 45 days from its date of adoption. After notice pursuant to Section 65090 and public hearing, the legislative body may extend the interim ordinance for 10 months and 15 days and subsequently extend the interim ordinance for one year. Any extension shall also require a four-fifths vote for adoption. Not more than two extensions may be adopted”; and,
WHEREAS, on March 15, 2023, the City Council conducted a public hearing and approved Citywide Urgency Ordinance No. 1791 adopting an interim measure imposing a moratorium on the use, construction, establishment or operation of new self-storage facilities, mini-storage facilities and recreational vehicle storage facilities within the City of Indio; and,
WHEREAS, on April 19, 2023, the City Council conducted a public hearing and approved Citywide Urgency Ordinance No. 1793 extending an interim measure imposing a moratorium on the use, construction, establishment or operation of new self-storage facilities, mini-storage facilities and recreational vehicle storage facilities within the City of Indio; and,
WHEREAS, subsequent to the City Council’s approval of Citywide Urgency Ordinance No. 1793, the Community Development Department conducted a community survey regarding the regulation of storage facilities and also held an industry and interested parties stakeholder meeting on February 5, 2024; and, WHEREAS, on March 6, 2024, the City Council conducted a public hearing and approved Citywide Urgency Ordinance No. 1810 to authorize the extension to July 1, 2024, of citywide Urgency Ordinance No. 1793, an interim measure imposing a moratorium on the use, construction, establishment or operation of new self-storage facilities, mini-storage facilities and recreational vehicle storage facilities within the City of Indio; and,

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 401 of 1671 4 WHEREAS, on April 10, 2024, the Planning Commission conducted a public study session during a regularly scheduled meeting to review and discuss potential policy alternatives for the regulation of self-storage/mini-storage facilities and recreational vehicle storage facilities in the City of Indio with these alternatives consisting of Policy Alternative No. 1 – No Change Alternative, Policy Alternative No. 2 – Enhanced Design Requirements, Policy Alternative No. 3 – Prohibition on New Uses, Policy Alternative No. 4 – Limitation on Total Number within City, Policy Alternative No. 5 – Location on Unique, Odd-Shaped or Physically Constrained Parcels, Policy Alternative No. 6 – Location Limitations for Facilities and Policy Alternative No. 7: Limitation To Interior Only/TwoStory Designs; and, WHEREAS, at the conclusion of its review and discussion on April 10, 2024, the Planning Commission provided consensus direction on a hybrid policy alternative for storage facilities consisting of Policy Alternative #4 (Limitation on Total Number within City) plus Policy Alternative #6 (Location Limitations for Facilities) plus Policy Alternative #2 (Enhanced Design Standards); and,
WHEREAS, on April 24, 2024, the Planning Commission conducted a public study session during a regularly scheduled meeting to review and discuss the Community Development Department’s analysis of the aforementioned hybrid alternative; and, WHEREAS, at the conclusion of its discussion on April 24, 2024, the Planning Commission provided consensus direction on the establishment of new storage facilities as prohibited land uses within the municipal limits of the City together with consensus direction that any recommendation to the City Council for this prohibition should include a five (5) year review with possible action from the effective date of the City Council’s action on the Planning Commission’s recommendation; and, WHEREAS, Section 15061 (Review for Exemption) of Title 14 of the California Code of Regulations and more specifically (b)(3) of this Section specifies that a lead agency may determine that an activity is covered by the commonsense exemption of the California Environmental Quality Act (CEQA) where it can be seen with certainty that there is no possibility that the activity (ies) in question may have a significant effect on the environment, then the activity (ies) is not subject to CEQA; and, WHEREAS, a notice of a public hearing for the Planning Commission’s consideration of the requested text amendments was published in the April 28, 2024 edition of the Desert Sun, a newspaper of record; and,
WHEREAS, on May 8, 2024, the Planning Commission held a duly noticed public hearing to consider the requested text amendments during which evidence, both written and oral, including the staff report and supporting documents, was presented at said hearing; and,

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 402 of 1671 5 WHEREAS, at the conclusion of the public hearing and following discussion, the Planning Commission unanimously approved Resolution No. 2090 recommending to the City Council the approval of the text amendments to Section 2.04/Figure 2.04.02 and Section 4.19 (Mini-Storage Warehousing and Facilities) of the Unified Development Code to establish as prohibited land uses within the municipal limits of the City of Indio new self-storage facilities, mini-storage facilities and recreational vehicle storage facilities and further recommending the adoption of the determination that the text amendments qualify for the commonsense exemption pursuant to California Environmental Quality Act (CEQA) Guidelines Section 15061(b)(3) as it can be seen with certainty that there is no possibility that the text amendments will have a significant impact on the environment; and,
WHEREAS, a notice of a public hearing for the City Council’s consideration of the Planning Commission’s recommendation for the requested text amendments was published in the June 5, 2024 edition of the Desert Sun, a newspaper of record as welk as notice was provided to interested parties; and,
WHEREAS, on June 19, 2024, the City Council conducted a duly noticed public hearing and at the conclusion of the public hearing, following discussion and deliberation, the City Council determined that the passage of this Ordinance was in the interest of the public health, safety and welfare.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF INDIO,
CALIFORNIA, HEREBY FINDS, DETERMINES AND RESOLVESAS FOLLOWS:

SECTION 1. Incorporation of Recitals. The City Council hereby finds that all of the facts set forth in the recitals of this Ordinance are true and correct, and are incorporated into the following findings by reference, and constitute a material part of this Ordinance.

SECTION 2. Environmental Findings. The Planning Commission has independently reviewed the administrative record for the text amendments including all oral and written comments received during the public hearing, the staff report, and all attachments thereto, which are all incorporated herein by reference and are on file with the Community Development Department for the City of Indio, and the Planning Commission finds that environmental compliance has been achieved as discussed below:

I. Compliance to Section 6.03.06. (Environmental Review) specifies the following:

A. California Environmental Quality Act (CEQA) Environmental Review:

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 403 of 1671 6 Quality Act (CEQA) where it can be seen with certainty that there is no possibility that the activity (ies) in question may have a significant effect on the environment, then the activity (ies) is not subject to CEQA.

The City Council concurs with the Community Development Department’s determination that the commonsense exemption specified in Section 15061(b)(3) is applicable to the text amendments specified herein as said amendments will prohibit the conduct and operation of a certain land use within the City that may have environmental impacts, but whose prohibition will result in these impacts not occurring. Further, the City Council considered the application of Section 15061(b)(3) together with any comments received during the public review process. The City Council has determined the text amendments are subject to the commonsense exemption specified in Section 15061(b)(3).

SECTION 3. Land Use Findings. Based upon the evidence presented at the hearing, including the staff report and written and verbal testimony, which are all incorporated herein by reference, the City Council hereby finds that:

SECTION 6.06.01 (AMENDMENTS TO THE GENERAL PLAN, DEVELOPMENT CODE AND ZONING

MAP) OF THE CITY OF INDIO UNIFIED DEVELOPMENT CODE
I. Criteria for Zoning Amendments.

1. The amendment is consistent with the General Plan;
Goal LU-1: Citywide Urban Structure. An urban structure that enhances the quality of life of residents, meets the community’s vision for the future, and weaves new growth areas together with established Indio neighborhoods.
• Maintaining the I-10 Employment Corridor subarea as a critical economic engine for the City.

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 404 of 1671 7 City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There are a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040.

Goal LU-2: Active Places. Indio is a City with active and comfortable places that encourage social interaction and community gathering.

Policy LU-2.2 Balanced land uses. Maintain a balanced land use pattern to support a broad range of housing choices, retail businesses, employment opportunities, educational and cultural institutions, entertainment spaces, and other supportive uses and within long-established Indio neighborhoods and new growth areas.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040.

Policy LU-10.2 Emerging industries. Support a diverse mix of light industrial, information, maker, and technology in order to provide jobs and tax revenues for the community by

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 405 of 1671 8 allowing emerging economic uses and industries within the Workplace and Employment designation.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040 and more specifically, this Policy. The prohibition of storage facilities within the Specific Plan boundaries will assist in maintaining the City’s industrial land base that will provide the opportunity to support the development of a diverse mix of light industrial, information, maker and technology businesses to provide jobs and tax revenues.

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 406 of 1671 9 of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The availability of industrial properties that would not be consumed by storage facilities would provide available land base for the development of future flex spaces for technology, light manufacturing and service tenants that would provide local employment opportunities and help diversify the City’s economic base.

Goal ED-1: Vibrant Economy. A vibrant economy that maintains existing businesses and attracts new development.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. In order for the City to have a vibrant economy and to be able to attract new industrial oriented development, the City must ensure that its industrial land inventory is maintained and is not given over to land uses that create no or limited jobs and do not substantively

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 407 of 1671 10 contribute to the fiscal health of the City and the community. The prohibition of storage facilities within the Specific Plan boundaries will help maintain the industrial land base within the City assisting the City in its ability to attract new beneficial industrial businesses to support the City’s efforts to create a vibrant and sustainable local economy.

Goal ED-2: Employment Base. A growing employment base with a diversity of job opportunities for current and future residents.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the Specific Plan boundaries will help maintain the industrial land base within the City assisting the City in its ability to attract businesses that offer professional and technical jobs that will increase skill and wage levels in the City and diversity the City’s economic base.

Policy ED-2.4 Industrial growth. Support the retention and growth of the industrial and manufacturing sector and actively attract new industrial businesses.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 408 of 1671 11 qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the City will help maintain the industrial land base within the Specific Plan boundaries assisting the City in its ability to support the retention and growth of the industrial and manufacturing sector and actively attract new industrial businesses.

Policy ED-2.6 Attract livable wages. Continue to pursue and attract companies and industries who offer livable wages and medical benefits for employees in Indio.

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 409 of 1671 12 entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the Specific Plan boundaries will help the City in its economic development efforts to pursue and attract companies and industries that would offer livable wages and medical benefits for employees in the City.

Goal ED-3: Workforce Development. A City with a highly educated, skilled, and adaptable workforce that is growing.

Policy ED-3.1 Economic development and labor pool alignment. Align economic development efforts with the labor pool to increase the number of jobs filled by Indio residents.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the Specific Plan boundaries will help maintain the industrial land base within the City assisting the City in its efforts to increase the number of jobs filled by Indio residents through proactive economic development efforts that benefit from a retained industrial land base.

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Second Reading of Ordinance No. 1814 : Text Amendments to Section 2.04/F... Page 410 of 1671 13 Goal ED-6: Tax Base Diversification. A City with a diversified tax base that allows it to flourish during different market cycles.

The text amendments would prohibit mini-storage, self-storage and recreational vehicle storage facilities within the City’s municipal limits. While these land uses provide a qualitative benefit to residents and businesses of Indio and other surrounding communities through the provision of storage spaces for personal property and real property, they generated no to limited employment, limited property taxes and no to limited sales taxes. These facilities are currently only allowed in those areas of the City designated with Light Industrial and Heavy Industrial zoning designations. The City currently has a limited supply of industrially zoned land (approximately 519 acres) and the utilization of this land for non or limited employment generating purposes is inconsistent with applicable goals and policies of Chapter 3 (Land Use and Urban Design) and Chapter 5 (Economic Development) of the General Plan 2040. A substantial number of working Indio residents – approximately 83 percent per an analysis conducted by the Coachella Valley Economic Partnership – leave the City to work. This results in a direct loss of jobs to other communities in the Coachella Valley as well as indirect loss of revenue benefits because of the lack of utilization of retail and personal services that generate sales tax revenue that can be utilized to provide public services. Further, the City of Indio has fourteen (14) existing facilities with six (6) more facilities currently entitled, being reviewed for building permit issuance or engineering approval or under construction. There is a total of nine (9) of these facilities in the surrounding communities of Coachella, La Quinta, Palm Desert and unincorporated Bermuda Dunes. The City of Indio has more than double the total number of facilities in the surrounding communities that reduces the available industrial land base for the development of employment generating land uses and businesses envisioned by the General Plan 2040. The prohibition of storage facilities within the Specific Plan boundaries will help maintain the industrial land base within the City assisting the City in its ability to attract businesses that offer professional and technical jobs that will increase skill and wage levels in the City and diversity the City’s economic base.

Goal ED-8: Jobs-Housing Balance. A City that grows with a balance of jobs and housing to meet the needs of current and future residents.

Policy ED-8.2 Employment infill. Allow employment generating land uses at infill sites and in development locations.

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Indio City CouncilJuly 17, 2024

Indio City Council
July 17, 2024