Lynwood City Council
August 2, 2022

1.1.1 “Agreement” means this Development Agreement and all attachments and exhibits hereto.

1.1.2 “Annual Net Revenue” means all income actually received by Developer in connection with the Billboard (net of any commissions paid by Developer to advertising agencies or brokers , not to exceed 16 -2/3%). For the purposes hereof, any income described in this definition will not include the value of any in-kind usage of the Billboard by the City pursuant to Section 2.6 or any other in-kind usage for political messages or for public service messages from nonprofit organizations or for nonpaying clients who are testing the sign or given bonuses.

1.1.3 “Billboard” and “Digital Display” shall have the meanings ascribed in the Recital above

1.1.4 “City” means the City of Lynwood, a California municipal corporation and a general law city.

1.1.5 “City Council” means the City Council of the City.

1.1.6 “Developer” means Bulletin Displays, LLC, duly existing and operating and its successors and assigns, as further described in Section 8.20.

1.1.7 “Development Approval” means the approved Project, based on the approval of the City Council, as further described at Recital G and Section 3.3 herein.

1.1.8 “Effective Date” means the date inserted into the preamble of this Agreement, which is 30 days following approval of this Agreement by ordinance of the City Council, provided the Agreement is signed by the Developer and the City.

1.1.9 “Final Permits” shall be when all approvals necessary to construct the Billboard and the Digital Displays have been obtained from all applicable governmental and quasi- governmental authorities, including but not limited to any and all permits a nd approvals required by: (i) the Lynwood Municipal Code; (ii) the California Department of Transportation (“Caltrans”) pursuant to the California Outdoor Advertising Act; (iii) applicable utilities affected by the construction; and (iv) CEQA and the State CEQA Guidelines.

1.1.10 “Land Use Regulations” means all ordinances, resolutions, codes, rules, regulations and official policies of City, including, but not limited to, the City’s General Plan and Municipal Code, which govern the development and use of the Site, including, without limitation, the permitted use of land, the density or intensity of use, subdivision requirements, the maximum height and size of the Billboard, the provisions for reservation or dedication of land for public purposes, and the design, improvement and construction standards and specifications applicable to the Development of the Billboard at the Site which are in full force and effect as of the Effective City Council Regular Meeting - Page 295 of 421
4 Date of this Agreement. Land Use Regulations shall also include National Pollutant Discharge Elimination System (“NPDES”) regulations, to the extent applicable.

1.1.11 “Lease” means the agreement between Developer and the Property owner granting Developer the legal right to install, operate and maintain the Billboard and Digital Display at the Site.

1.1.12 “Operational” means , the date that all L.E.D. panels of the Digital Display are capable, legally and functionally, of displaying advertising or issuance of all governmental and Southern California Edison approvals, whichever is sooner.

1.1.13 “Project” means the installation, operation and maintenance of the Digital Display on the Billboard on the Site, all in accordance with the Development Approvals, and this Agreement.

1.1.14 “Site” shall have the meaning ascribed in Recital “B”, above.

1.1.15 “Subsequent Land Use Regulations” means any Land Use Regulations that take effect after the Effective Date of this Agreement which may govern the Project.

1.1.16 “Term” shall have the meaning provided in Section 2.4, unless earli er terminated as provided for in this Agreement.

1.2 Exhibits. The following documents are attached hereto and are by this reference made a part of this Agreement:

Exhibit “A” (Legal Description of Property)
Exhibit “B” (Site Plan)
Exhibit “C” (Digital Display and Billboard Elevations)
Exhibit “D” (Form for the Annual Statement of Annual Net Revenues)

2. GENERAL PROVISIONS.

2.1 Binding Effect of Agreement. From and following the Effective Date, actions by the City and Developer with respect to the Project, including actions by the City on application for subsequent Development Approvals affecting the Site, shall be subject to the terms and provisions of this Agreement; provided however, that nothing in this Agreement shall be deemed or construed to modify or amend the Lease, or any of the Developer’s obligations thereunder.

2.2 Interest in Site. City and Developer acknowledge and agree that Developer has a legal or equitable interest in the Site and is thus qualified to enter into and be a par ty to this Agreement under Development Agreement Law. Additionally, prior to the execution of this Agreement, Developer has allowed City to view a redacted copy of the Lease, which demonstrate that Developer has a long -term leasehold interest in the Site, which interest shall be maintained during the Term of this Agreement, at the discretion the Developer. If Developer’s interest in the Lease is prematurely terminated, Developer may assign this Agreement as provided in Section 2.3, below. If Developer extends the Lease beyond the Term of this Agreement and this Agreement is City Council Regular Meeting - Page 296 of 421
5 not extended to the new Lease expiration date by the City, at the expiration of this Agreement, If Developer’s interest in the Lease terminates before the expiration of this Agreement and Developer is not able to Assign this Agreement as provided in Section 2.3, Developer will remove the Billboard and Digital Display and sign a written cancellation of this Agreement, as provided in Section 4.1.

2.3 Assignment. Developer shall not assign or otherwise transfer this Agreement, or its interest in the Site to any other person, firm, or entity , without City’s written consent, which shall not be unreasonably withheld. An assignment of this Agreement shall be to a party that has demonstrated positive experience operating billboards similar to the Project, and who can provide evidence of adequate financial resources and expertise in securing advertisers for billboards similar to the Project. Developer shall notify City no later than ninety (90) days prior to any such proposed assignment and provide all documentation necessary for City to verify compliance with this requirement. Any transfer not meeting the requirements in this Section 2.3 shall be subject to the approval of the City Council. Any security posted by Developer may be substituted by the assignee or transferee. The prohibition against an assignment without reasonable City’s approval shall not be required for, or deemed to prevent , (i) the renting or subleasing or licensing of space for advertisements or displays consistent with the customary uses and practices for billboards and message boards or (ii) the assignment of this Agreement to any affiliate of Developer or joint venture in which Developer participates provided that Developer submits evidence satisfactory to City that the principals who own and control Developer will maintain a majority controlling interest after consummation of such transaction and will have the ability to maintain a majority controlling interest throughout the Term, (iii) Developer, in any manner, at Developer’s sole discretion, from encumbering Sites or any portion thereof or the Development or any improvement on the Sites thereon by any mortgage, deed of trust or other security device securing financing with respect to the Sites. The City acknowledges that the lenders providing such financing may require certain Agreement interpretations and modifications and the City agrees upon request, from time to time, to meet with Developer or Owner and representatives of such lenders to negotiate in good faith any such request for interpretation or modification. Subject to compliance with applicable laws, the City will not withhold its consent to any such requested interpretation or modification, provided the City determ ines such interpretation or modification is consistent with the intent and purposes of this Agreement. Upon reasonable approval by the City Attorney as to form, the City authorizes the City Manager to execute any Notices of Consent to Assignment on behalf of the City or similar financial documentation.

2.4 Term of Agreement. Unless this Agreement is earlier terminated as provided for herein, this Agreement shall continue in full force and effect for thirty (30) years after the date the Digital Display becomes Operational or the removal of the Digital Display, whichever is earlier (“Term”). The Parties may extend the Term or amend the terms of this Agreement by written amendment, subject to approval of the City Council. If the parties are unable to ag ree to extend the Term; then, within thirty (30) days after the expiration or termination of this Agreement, the parties shall execute a written cancellation of this Agreement, which shall be recorded with the County Recorder at the City's expense pursuant to Section 8.1 below

2.5 Public Benefits.

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6 2.5.1 Development Fees.
(a) Minimum Annual Guarantee (“MAG”). In addition to the one-time development fee required under Section 2.5.1(a), Developer shall pay City an annual MAG fee of $75,000.00 (the “ MAG Fee”) during the Term of this Agreement payable in equal monthly installments paid to the City on or before the fifteenth (15th) day of the first month following Digital Display becoming Operational and each month thereafter. The MAG shall be increased annually on the anniversary of the Digital Display becoming Operational by 2%. (b) Percentage Fee. To the extent that ten percent (10%) (the “Annual Revenue Share Percentage”) of the Annual Net Revenue exceeds the MAG (or the prorated MAG for the 1st and last year of the Term) as of March 31st of every year starting the year after the MAG Commencement Date, Developer shall make an additional payment to the City by March 31st of each year of the Term in the amount by which (i) the Annual Revenue Share Percentage multiplied by (ii) the Annual Net Revenue collected by Developer for the immediate preceding Term year exceeds the MAG amount paid by Tenant to the City pursuant to Section 2.5.1(b) for such Term year. In no eve nt shall the amount of the Development Fees due under Section 2.5.1 of this Agreement be less than the MAG.
(1) Reports. Developer shall furnish to City an annual statement of Annual Net Revenue for the Digital Display by March 31 st of each year of the Term. Such statement shall be in a form listed in Exhibit D. Each statement shall be signed and certified to be correct by a duly authorized officer of Developer or by the head of their accounting department.

Developer shall keep and ma ke available complete and materially accurate books of account, records, cash receipts and other pertinent data, in accordance with good accounting practices, showing the Annual Net Revenue, including without limitation, materially accurate records of every sale and other sales transaction made for any advertising display on the Digital Display and any commissions paid by Developer to an agency or broker. Such books of account, records, cash receipts, or other pertinent data shall be kept for a period of n o less than four (4) years after the end of each year. The receipt by City of any statement, or any payment of the Percentage Fee for any period, will not bind City as to the correctness of the statement or payment. (2) Inspection and Audit. City, a t its sole option, shall be entitled, at any time and from time to time during the Term and during normal business hours and with prior written notice to Developer, to inspect, examine, copy and audit Developer's books, records and cash receipts as related to Annual Net Revenue. Developer shall cooperate fully with City and City's agents in making the examination. City, at its option, will also be entitled once during each year of the Term and once after the Expiration Date or other termination of this Agreement, to cause an independent audit of such records to be performed by a certified public accountant designated by City, provided such accountant is not paid on a contingency fee basis.

The audit will be conducted during usual business hours at Develop er’s office located at 3127 E.

South Street, Suite B, Long Beach, CA 90805 , unless another location is mutually agreed upon.

If the audit shows that there is a deficiency in the payment of any Percentage Fee, then Developer shall promptly upon notice pay the deficiency to City which payment will not require any penalty or other late fee. City will pay the costs of the audit unless the audit shows that Developer understated Annual Net Revenue by more than three (3%) percent in which case Developer shall City Council Regular Meeting - Page 298 of 421
7 pay all reasonable out -of-pocket costs paid to third party consultants and incurred by City in connection with the audit.
(c) Late Charge; Default Interest.
(1) Late Charge. If Developer fails to pay any payments or fees required under this Agreement after the same is due and payable, such unpaid amount shall be subject to a late payment charge equal to five percent (5%) of the unpaid amount in each instance.

The late payment charge has been agreed upon by City and Developer, after negotiation, as a reasonable estimate of the additional administrative costs and detriment that City will incur as a result of any such failure by Developer, the actual costs thereof being extremely difficult—if not impossible—to determine. The late payment charge constitutes liquidated damages to compensate City for its damages resulting from such failure to pay, and Developer shall promptly pay such charge to City together with any unpaid interest.
(2) Default Interest. If any payments or fees are not paid following the due date, such unpaid amount will bear simple interest at the rate of 10% per year or the maximum permitted by law, whichever is lower (“Default Rate”) from the due date until paid.

However, interest will not be payable on late charges incurred by Developer, nor on any amounts on which late charges are paid by Developer to the extent this interest would cause the total interest to be in excess of that which an individual is lawfu lly permitted to charge. Payment of interest will not excuse or cure any default by Developer.
(3) Application of Payments . All payments received by City from Developer will be applied to the corresponding obligation owed by Developer to City. No designation by Developer, either in a separate writing, on a check or money order, or otherwise will modify this Agreement or have any force or effect.

2.5.2 Processing Fee. Developer has paid to City a one -time, nonrefundable processing fee ("Processing Fee") in the amount of Twenty Thousand Dollars ($20,000.00), which shall be used to pay City for the following: (1) City staff’s costs for the review and processing of this Development Agreement separate from the processing of such other b uilding and planning entitlements or CEQA review in connection with the Digital Display and (2) City’s costs associated with costs of the City’s legal counsel or any other of City consultants associated with the preparation, processing, and review of this Agreement. The Processing Fee shall be separate from all fees which are standard and uniformly applied to similar projects in the City, including, but not limited to, business license fees (due by Developer to City annually), one-time plan check fee and building permit fee and any other fees imposed by the City as may be applicable.

2.6 City Usage of Digital Display. To the extent that commercial advertising time on the Billboard is unsold and available, City shall have the right to use up to five percent (5%) of the total advertising time to promote civic and public purposes that serve the needs of the City and its residents, including but not limited to, City events and programs (such usage “City Usage”). City Usage shall be displayed (subject to the terms of this Agreement) during the operation of the Digital Display in increments, equally spread throughout each 24 -hour day on a space available basis as long as the City obtains 5% on an annual basis if they request it (any time not requested City Council Regular Meeting - Page 299 of 421
8 is lost at the end of each year and does not accumulate to the next year), and otherwise in the same manner as other commercial advertising displayed on the Digital Display. The City shall submit all proposed copy to Developer not less than five (5) business days prior to the date the copy is proposed to be displayed. All proposed City Advertising copy shall be prepared and submitted at the City’s sole cost, shall be in a format r eady for posting on the Digital Display per Developer’s posting specification sheet, and shall be subject to Developer’s standard advertising copy rejection and removal policies, which allow Developer to approve or disapprove copy and remove copy once posted or displayed. City represents and warrants that all copy, content and materials supplied by City to Developer for display under this Agreement: (i) are owned or duly licensed by City and do not infringe or misappropriate the rights of any other person o r entity; (ii) comply with all applicable federal, state, and local laws, rules and regulations and any industry codes or rules by which City and/or Developer may be bound and do not contain any obscene, libelous, slanderous or otherwise defamatory materials or refer in an offensive manner to the gender, race or ethnicity of any individual or group; (iii) are accurate and that all claims contained therein have been substantiated; and (iv) do not infringe upon any copyright, trademark or other intellectual property or privacy right of any third party. Any content provided by City shall be owned and belong exclusively to the City, and Developer shall not reproduce, sell, or give away any such content without the advance written consent of the City.

2.6.1 Emergency Notifications. Without any offset in the City Usage described above and at no cost to the City and as further consideration for the use and occupancy of Premises, Tenant shall make the Digital Display available to Caltrans and the California Highway Patrol on a space available basis for purposes of “Amber Alerts” and for emergency or disaster notifications by local, state, or federal agencies.

2.6.2 Jurisdictional Sign. In addition, Developer agrees to construct and install on the Billboard an illuminated jurisdictional sign naming the City of Lynwood at no cost to City with the final design agreed to between the City and Developer.

2.6.3 City Facility Authorized. Upon mutual agreement of Developer and the City’s Manager, the City or Developer may install telecommunication equipment (the “Equipment”) on the pole at a cost to be paid by the telecommunication company and if all Parties and the telecommunication enter into a indemnification, defense and hold harmless agreement regarding the Equipment acceptable to Developer and the City and the Developer approve of the modifications requested by the telecommunication company and enter into a lease with the telecommunication company. This clause is subject to the unilateral approval of De veloper’s landlord which can refuse for any reason, reasonable or not.

2.6.4 Fixed Facility Fee: Should City and Developer enter into a lease with a telecommunication company and Developer’s landlord for the installation of an antenna or wireless communication device for cellular, wi -fi or other service on the Billboard pole or structure (the “Device”), the City and Developer shall share equally the gross revenue collected as a result of the Device as additional revenue after the Developer’s landlord portion of the gross revenue is deducted. The party receiving the additional revenue from the telecommunication company shall have the right to review and audit the revenue received within 30 days upon request by the other party.

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9 2.7 Prohibited Use. Developer shall not utilize any of the Digital Displays to advertise or display messages that are:

2.7.2 promotes the sale of firearms, tobacco products, whether directly or indirectly;

2.7.3 promotes sexually oriented materials, adult businesses, entertain ment, products, conventions, events, or websites; and

2.7.4 promotes any product, service or activity illegal under federal, state, or local law.

3. DEVELOPMENT AND IMPLEMENTATION OF THE PROJECT.

3.1 Rights to Develop Billboard on the Site. Subject to and during the Term of this Agreement, Developer shall have the right to develop the Project on the Site in accordance with, and to the extent of, the Final Permits, the Land Use Regulations, and this Agreement, provided that nothing in this Agreement shall be deemed to modify or amend the Lease.

3.2 Effect of Agreement on Land use Regulations. The rules, regulations and official policies governing permitted uses of the Site, the density and intensity of such uses, the maximum height and size of proposed struc tures, and the design, improvement and construction standards and specifications applicable to the development of the Project shall be as set forth in the Land Use Regulations, as such term is defined in Section 1.1. 10, which are in full force and effect on the Effective Date.

3.3 Development Approvals. Developer shall, at its own expense and before commencement of demolition, construction or development of any structures or other work of improvement upon the Site, secure or cause to be secured all necessary Development Approvals, which shall include any and all permits and approvals which may be required by City or any other governmental agency or utility affected by such construction, development or work to be performed by Developer, including but not limited to, necessary building permits and all approvals required under the California Environmental Quality Act ("CEQA") if any, although the Project will be processed as categorically exempt from CEQA pursuant to Section 15332 regarding Urban In-Fill Development Projects. Not by way of limiting the foregoing, in developing and constructing the Project, Developer shall comply with all (1) development standards in City's Municipal Code applicable on the Effective Date, (2) NPDES requirements pertaining to the Project applicable on the Effective Date, (3) all applicable building codes applicable on the Effective Date, except as the Project may be permitted through approved variances and modifications, and (4) all Caltrans rules and regulations necessary to obtain an Outdoor Advertising Permit including a Relocation Agreement, if required. Developer shall pay all normal and customary fees and charges applicable to such permits, and any fees and charges hereafter imposed by City in connection with the Project which are standard and uniformly applied to similar projects in the City.

3.3.1 Relocation. The City shall cooperate and assist the off -site advertising sign Developer with complying with federal, state and local laws for any off -site advertising sign that was approved by a development agreement; including but not limited to assistance with a relocation per Bus. & Professions Code, Section 5412 for any of the off -site City Council Regular Meeting - Page 301 of 421
10 advertising sign locations that are in landscaped classified areas per state law. The Parties acknowledge that the Property located at 11350 Wright Road, in the City of Lynwood, in the County of Los Angeles (Assessor’s Parcel Number 6194 -031-007) is on a landscaped section of the Long Beach (710) Freeway and that Developer will need to pursue a relocation per Bus. & Professions Code, Section 5412. Therefore City desires to support and cooperate in the necessary relocation processes for permitting the construction and operation of billboards on the Property since the relocation allows the City to continued development in a planned manner for the general welfare and benefit of the public.

3.4 Timing of Project. Developer shall commence the Project within one-hundred forty (140 ) days after obtaining the Final Permits. “Commencement" of the Project is herein defined as the start of construction of the Billboard on the Site under the applicable Final Permits.

In the event Developer fails to commence such construction within one-hundred forty (140) days after obtaining the Final Permits, and after compliance with Section 5.3, either party hereto may terminate this Agreement by delivering written notice to the other party, and, in the event of such termination, neither party shall have any further obligation hereunder. However, if circumstances within the scope of Section 8.10 delay the commencement or completion of the Project, it would not constitute grounds for any termination rights found within this Agreement. In such case, the timeline to commence or complete the relevant task shall be extended in the manner set forth at Section 8.10. Notwithstanding the above, Developer shall, at al l times, comply with all other obligations set forth in this Agreement regarding construction of the Project on the Site. Developer shall also maintain and operate the Billboard at all times during the Term of this Agreement in compliance with the provisions set forth below:

3.4.1 Maintenance. Developer, for itself and its successors and assigns, hereby covenants and agrees to be responsible for the maintenance and repair of the Billboard, including but not limited to, the Digital Displays installed thereon, and all related on -Site improvements, easements, rights -of-way and, if applicable, at its sole cost and expense, including, without limitation, poles and lighting, in good repair, free of graffiti, rubbish, debris and other hazards to persons using the same, and in accordance with all applicable laws, rules, ordinances and regulations of all federal, State, and local bodies and agencies having jurisdiction over t he Site.

Such maintenance and repair shall include, but not be limited to, the following: (i) sweeping and trash removal related to the Billboard; (ii) ongoing maintenance by the Developer of any access area to the Billboard to minimize dust caused by the Project; (iii) the adequate and complete removal or painting over of all graffiti within 48 hours of notice of such graffiti being affixed on the Billboard; and (iv) the repair, replacement and repainting of the structure and the Digital Displays as necessary to maintain such Billboard in good condition and repair.

3.4.2 Developer shall comply with the standards as adopted by the Outdoor Advertising Association of America, Inc. (OAAA), including but not limited to, the 0.3 foot - candles limitation over am bient light levels at 250 feet, and ensuring additional flexibility in reducing such maximum light level standard given the lighting environment, the obligation to have automatic diming capabilities, as well as providing the City’s Planning Manager or designee with a designated Developer employee’s phone number and/or email address for emergencies or complaints that will be monitored 24 hours a day/7 days per week.

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11 3.4.3 In the event ten percent (10%) or more of the digital sign face is not operating correctly or in the event of a malfunction, Developer shall immediately turn the entire display off, or show a one hundred percent (100%) black image on the display until corrected.

3.5 Changes and Amendments. Developer may determine that changes to the Development Approvals are appropriate and desirable. In the event Developer makes such a determination, Developer may apply in writing for an amendment to the Development Approvals to effectuate such change(s). The Parties acknowledge that City shall be permitted to use its inherent land use authority in deciding whether to approve or deny any such amendment request; provided, however, that in exercising the foregoing the City shall use reasonable discretion and shall not apply a standard different than that used in evaluating requests of other developers. Accordingly, under no circumstance shall City be obligated in any manner to approve any amendment to the Development Approvals. The City Manager shall be authorized to approve, without processing an amendment to this Agreement, any non-substantive amendment to the Development Approvals that does not: (i) adversely impact and/or diminish Developer’s or City’s rights as provided hereunder and (ii) affect and/or block the visibility of the Digital Display or accessibility to the Billboard or (iii) decreases the public benefits set forth herein. All other amendments shall require approval of the City Council.

Nothing herein shall cause Developer to be in default under this Agreement if it upgrades the Digital Display or the Billboard to incorporate newer technology or design; provided Developer shall secure all applicable ministerial permits to do so and such upgrade is consistent with the dimensions provided in this Agreement.

3.6 Reservation of Authority

3.6.1 Limitations, Reservations and Exceptions. Notwithstanding any other provision of this Agreement, the following Subsequent Land Use Regulations shall apply to the development of the Project:
(a) Processing fees and charges of every kind and nature imposed by Ci ty to cover the estimated actual costs to City of processing applications for amendments to the Development Approvals.
(b) Procedural regulations consistent with this Agreement relating to hearing bodies, petitions, applications, notices, findings, records, he arings, reports, recommendations, appeals and any other matter of procedure. Notwithstandi ng the foregoing, if such change materially changes Developer's costs or otherwise materially impacts its performance hereunder, Developer may terminate this Agreement upon ninety (90) days prior written notice. (c) Changes adopted by the International Conference of Building Officials, or other similar body, as part of the then most current versions of the Uniform Building Code, Uniform Fire Code, Uniform Plumbing Code, Un iform Mechanical Code, or National Electrical Code, as adopted by City as Subsequent Land Use Regulations, if adopted prior to the issuance of a building permit related to an amendment to the Development Approval. Notwithstanding the foregoing, if such cha nge materially changes Developer's costs or otherwise materially impacts its performance hereunder, developer may terminate this Agreement upon ninety (90) days prior written notice.

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12 (d) Regulations that are not in conflict with the Development Approvals or this Agreement.
(e) Regulations that are in conflict with the Development Approvals or this Agreement, provided Developer has given written consent to the application of such regulations to the development of the Project.
(f) Applicable Federal, State, County, and multi-jurisdictional laws and regulations which the City is required to enforce against the Site or the development of the Project and that do not have an exception for existing signs or legal nonconforming uses.

3.6.2 Future Discretion of City. This Agreement shall not prevent City from denying or conditionally approving any application for a subsequent development approval on the basis of Subsequent Land Use Regulations.

3.6.3 Modification or Suspension by Federal, State, County, or Multi - Jurisdictional Law. In the event that applicable federal, State, County, or multi-jurisdictional laws or regulations, enacted after the Effective Date of this Agreement, prevent or preclude compliance with one or more of the provisions of this Agreement, and there i s no exception for the legal nonconforming use, such provisions of this Agreement shall be modified or suspended as may be necessary to comply with such federal, State, County, or multi -jurisdictional laws or regulations, and this Agreement shall remain in full force and effect to the extent it is not inconsistent with such laws or regulations and to the extent such laws or regulations do not render such remaining provisions impractical to enforce.

3.7 Regulations by Other Public Agencies. It is acknowledged by the parties that other public agencies not subject to control by City may possess authority to regulate aspects of the development of the Project as contemplated herein, and this Agreement does not limit the authority of such other public agencies. Developer acknowledges and represents that, in addition to the Land Use Regulations, Developer shall, at all times, comply with all applicable federal, State and local laws and regulations applicable to the Billboard and Site that do not have an exception for a legal nonconforming use. To the extent such other public agencies preclude development or maintenance of the Project and do not have an exception for a legal nonconforming use, Developer shall not be further obligated under this Agreement except as provided in Section 4.1. Notwithstanding the foregoing, if such action by another public agency materially changes Developer's costs or otherwise materially impacts its performance hereunder, Developer may terminate this Agreement upon ninety (90) days prior written notice.

3.8 Public Improvements. Notwithstanding any provision herein to the contrary, City shall retain the right to condition any subsequent development approvals to require Developer to pay any required development fees, and/or to construct the required public infrastructure at such time as City shall determine.

3.9 Fees, Taxes Assessments. This Agreement shall not prohibit the application of customary fees, taxes, or assessments upon the Site.

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13 4. REMOVAL OF BILLBOARDS

4.1 Removal of Digital Display by Developer. If the Parties do not extend the Term of this Agreement pursuant to Section 2.4 above, or if Developer breaches this Agreement after notice and a right to cure as provided in Section 5.3, or if the Developer’s lease with the property owner otherwise terminates before the expiration of this Agreement or following the natural expiration of the Term or extensions thereof, Developer shall remove the Digital Display before lease termination and cancel this Agreement as provided in Section 2 .4. If Developer does not timely remove the Digital Display and other improvements as required by this Section, City may, but shall not be required to, remove or cause the removal of the Digital Display and related structures on the Premises at Developer' s expense and return the structures to the Developer or scrap them if Developer does not accept them . If Developer does not timely remove the Digital Display and other improvements as required by this Section and the City does not remove the sign, the City cannot operate the sign or allow anyone else to operate the sign. Developer shall reimburse City within thirty (30) days of receipt of an itemized accounting of the cost for such removal.

If the Lease terminates before the expiration of this Agreement, Developer will remove the Billboard concurrently with the Lease termination and cancel this Agreement as provided in Section 2.4. If Developer does not timely remove the Billboard and other improvements as required by this Section, City may, but shall not be required to, remove or cause the removal of the Billboard at Developer's expense and return the structures to the Developer or scrap them if Developer does not accept them . If Developer does not timely remove the Digital Display and other improvements as required by this Section and the City does not remove t he sign, the City cannot operate the sign or allow anyone else to operate the sign. Developer shall reimburse City within thirty (30) days of receipt of an itemized accounting of the cost for such removal.

4.2 City’s Right to Removal. Provided Developer is not in material breach hereof and subject to the notice and cure provisions in Section 5.3 herein, City will not have the right to: (i) remove the Digital Display, (ii) limit access to the Digital Display, or (iii) limit the visibility of the Digital Dis play, in any way, which is under their control. Should Developer breach this Agreement, City may only require removal of the Digital Display subject to Developer’s rights in Section 4.1.

5. REVIEW FOR COMPLIANCE.

5.1 Annual Review. The City may review this Agreement annually, at City's sole cost, to ascertain Developer’s good faith compliance with the terms of the Agreement ("Annual Review").

However, no failure on the part of City to conduct or complete an Annual Review as provided herein shall have any impact on the validity of this Agreement. Developer shall cooperate with City in the conduct of any Annual Review and timely provide the following information and documentation to City: (1) description of all complaints received regarding the Billboard that w ere unrelated to the content of any message displayed, (2) any updates to Developer's contact information, (3) status and amount of all payment obligations to the City required under this Agreement, (4) any easement or Lease changes that could in any way m aterially impact the City or Developer’s obligations under this Agreement, (5) any utility changes that could in any way materially impact the City or the City Council Regular Meeting - Page 305 of 421
14 obligations under this Agreement, and (6) any maintenance issues addressed or needing to be addressed that were raised by the City per the maintenance requirements herein.

5.2 City Rights of Access. Subject to City's execution of a permit to enter the Property, City’s officers, employees, agents and contractors, shall have the right, at their sole risk and expense, to enter the Site at all reasonable times and with as little interference as possible to the operation of the Billboard thereon, for the purpose of as suring compliance with this Agreement, conducting the annual review under this Section 5, as well as inspecting the construction, reconstruction, relocation, maintenance, repair and service of any public improvements or public facilities located on the Sit e, or to perform any rights of the City under Section 4.2 above. Any damage or injury to the Site or to the Billboard thereon resulting from such entry shall be promptly reported to the Developer to assess the proper repair procedure that the City shall so lely pay for, unless an emergency, where under the City can do a repair at the City’s sole expense and then report the damage and repair to the Developer . Notwithstanding the foregoing, or any other provision in this Agreement (including without limitation Section 4.2 above), City shall have no right to enter the Site unless and until City executes and delivers to Developer a permit to enter (except that this provision is not intended to interfere with the City's police powers to address any nuisance, dange rous condition, or other condition pursuant to the City's ordinances).

Notwithstanding anything to the contrary herein, in no event will City representatives ever climb up the pole of the Billboard during any inspection.

5.3 Procedure. Each party shall have a reasonable opportunity to assert matters, which it believes, have not been undertaken in accordance with the Agreement, to explain the basis for such assertion, and to receive from the other party a justification of its position on such matters. If either party concludes that the other party has not complied in good faith with the terms of the Agreement, then such party may issue a written "Notice of Non-Compliance" (“Notice”) specifying the grounds therefore and all facts demonstrating such non-compliance. The party receiving a Notice shall have thirty (30) days to cure or remedy the non -compliance identified in the Notice, or if such cure or remedy is not reasonably capable of being carried out to completion within such thirty (30) day period, to commence to cure or remedy the noncompliance and to diligently and in good faith prosecute such cure or remedy to completion. If the party receiving the Notice does not believe it is out of compliance, it may contest the Notice by responding in writing to said Notice within thirty (30) days after receipt of the Notice. If a response to the Notice has not been received in the offices of the party alleging the non -compliance within the prescribed time period, the Notice shall be conclusively presumed to be valid. If a Notice is contested, the parties shall, for a period of not less than fifteen (15) days after receipt of the response, seek to arrive at a mutually acceptable resolution of the matter(s) occasioning the Notice. In the event a cure or remedy is not timely effected or, if the Notice is contested and the parties are not able to arrive at a mutually acceptable resolution of the matter(s) by the end of the fifteen (15) day period, the party alleging the non -compliance may thereupon pursue the remedies provided in Section 6. Neither party hereto shall be deemed in breach of this Agreement if the reason for non-compliance is due to a "force majeure" as defined in, and subject to the provisions of Section 8.10.

5.4 Certificate of Agreements Compliance. If, at the conclusion of an Annual Review or a Special Review, Developer is found to be in compliance with this Agreement, City shall, issue a Certificate of Agreement Compliance ("Certificate") to Developer stating that, after City Council Regular Meeting - Page 306 of 421
15 the most recent Annual Review or Special Review, and based upon the information known or made known to the City Manager and City Council: (1) this Agreement remains in effect and (2) Developer is in compliance. The Certificate, whether issued after an Annual Review or Special Review, shall be in recordable form and shall contain information necessary to communicate constructive record notice of the finding of compliance. Developer may record the Certificate with the County Recorder. Additionally, Developer may, at any time, request from the City a Certificate stating, in addition to the foregoing, which obligations under this Agreement have been fully satisfied with respect to the Site.

6. DEFAULT AND REMEDIES

6.1 Termination of Agreement.

6.1.1 Termination of Agreement for Material Default of Developer. City, in its discretion, may terminate this Agreement for any material failure of Developer to perform any material duty or obligation of Developer hereunder or to comply in good faith with the terms of this Agreement (hereinafter referred to as "default" or "breach") after complying with the notice and cure period set forth in Subsection 5.3. In the event of a termination by City under this Section

6.1.1, Developer acknowledges and agrees that City will retain all Fees paid to City and accrued up to the date of the termination. However, this Section 6.1.1 shall have no effect on Developer’s rights as set forth in section 4.1.

6.1.2 Material Default of City. Developer, in its discretion, may terminate or seek any other remedy it deems appropriate for any material failure of City to perform any material duty or obligation of City hereunder or to comply in good faith with the term of this Agreement; provided, however, Developer may seek such remedy pursuant to this Section only after following the procedure set forth in Section 5.3.

6.1.3 Rights and Duties Following Termination. After termination of this Agreement, no party shall have any further right or obligation hereunder except with respect to (i) any obligations to ha ve been performed prior to said termination, (ii) any default in the performance of the provisions of this Agreement that occurred prior to said termination, (iii) Developer's obligation to remove the Digital Display pursuant to Section 4.1 or (iv) any continuing obligations to indemnify the other party.

7. INSURANCE, INDEMNIFICATION AND WAIVERS.

7.1 Insurance.

7.1.1 Types of Insurance.
(a) Liability Insurance. Beginning on the Effective Date hereof and until completion of the Term, Developer shall, at its sole cost and expense, keep or cause to be kept in force for the mutual benefit of City, as additional insured, and Developer, comprehensive broad form general liability insurance against claims and liabilities covered by the indemnification provisions of section 7.2. Developer has agreed to indemnify City hereunder to the extent of the City Council Regular Meeting - Page 307 of 421
16 liability insurance coverage with respect to its use, occupancy, disuse or condition of the Site, improvements or adjoining areas or ways, affected by such use of the Site or for property damage, providing protection of a least Two Million Dollars ($2,000,000) for bodily injury or death to any one person, at least Four Million Dollars ($4,000,000) for any one accident or occurrence, and at least One Million Dollars ($1,000,000) for property damage. Developer shall also furnish or cause to be furnished to City evidence that any contractors with whom Developer has contracted for the performance of any work for which Developer is responsible maintains the same coverage required of Developer.
(b) Worker’s Compensation. Developer shall also furnish (or cause to be furnished) to City evidence that Developer and any contractor with whom Developer has contracted for the performance of any work for which Developer is responsible hereunder maintains and carries worker's compensation insurance as required by law. (c) Insurance Policy Form, Sufficiency, Content and Insurer. All insurance required by express provisions hereof shall be carried only by responsible insurance companies qualified to do business by California with an AM Best Rating of no less than "A-". All such policies shall be non-assignable and shall contain language, to the extent obtainable, to the effect that (i) the insurer waives the right of subrogation against City and against City's agents and representatives except as provided in this section; (ii). Developer shall furnish City with certificates evidencing the insurance and City shall be named as an additional insured on all liability policies of insurance required to be procured by the terms of this Agreement.

7.2.1 Failure to Maintain Insurance and Proof of Compliance. Developer shall deliver to City, in the same manner required for notices, copies of certificates of all insurance policies required of each policy within the following time limits:
(a) For insurance required above, within seven (7) days after issuance of the Final Permits; and
(b) The City can request to see updated copies of the current certificates of all insurance policies required. The City reserves the r ight to obtain copies of the entire insurance policy, including endorsements.

If Developer fails or refuses to procure or maintain insurance as required hereby or fails or refuses to furnish City with required proof that the insurance has been procured and is in force and paid for, after complying with the requirements of Section 5.4, the City may view such failure or refusal as a default hereunder.

7.2 Indemnification

7.2.1 General. Developer shall indemnify City, and its respective officers, employees, and agents against, and will hold and save them and each of them harmless from, any and all actions, suits, claims, damages to persons or property, losses, costs, penalties, obligations, errors, omissions, or liabilities (herein "claims or liabilities") that may be asserted or claimed by any person, firm, or entity arising out of or in connection with the work, operations, or activities City Council Regular Meeting - Page 308 of 421
17 of Developer, its agents, employees, subcontractors, or invitees, hereunder, upon the Site . The City will promptly notify the permittee of any such claim, action, or proceeding against City and will cooperate fully in the defense. To this end:
(a) Developer will defend any action or actions filed in connection with any of said claims or liabilities covered by the indemnification provisions herein and will pay all costs and expenses, including legal costs and attorneys' fees incurred in connection therewith, which attorneys will be the attorneys hired by the insurance company where insurance coverage applies. (b) Developer will promptly pay any judgment rendered against the City or its respective officers, agents, or employees for any such claims or liabilities arising out of or in connection with such work, operations, or activities of the Developer hereunder, and Developer agrees to save and hold the City and its respective officers, agents, and employees harmless therefrom.

7.2.2 Exceptions. The foregoing indemnity shall not include claims or liabilities arising from the sole negligence or willful misconduct of City, its officers, agents, or employees.

7.2.3 Additional Coverage. Without limiting the generality of the foregoing, Developer’s indemnity obligation shall include any liability arising by reason of:
(a) Any accident or other occurrence in or on the Site causing injury to any person or property whatsoever caused by Developer.
(b) Any failure of Developer to comply with performance of all of the provisions of this Agreement.
(c) Any harm, delays, injuries or other damages incurred by any party as a result of any subsurfac e conditions on the Site caused solely by Developer, including but not limited to, the presence of buried debris, hazardous materials, hydrocarbons, or any form of soil contamination.

7.2.4 Loss and Damage. Except as set forth below, City shall not be liable for any damage to property of Developer or others located on the Site, nor for the loss of or damage to any property of Developer or others by theft or otherwise. Except as set forth below, City shall not be liable for any injury or damage to persons o r property resulting from fire, explosion, steam, gas, electricity, water, rain, dampness or leaks from any part of the Site or from the pipes or plumbing, or from the street, or from any environmental or soil contamination or hazard, or from any other latent or patent defect in the soil, subsurface or physical condition of the Site, or by any other cause of whatsoever nature. The foregoing two (2) sentences shall not apply: (i) to the extent City or its agents, employees, subcontractors, invitees or representatives cause such injury or damage when accessing the Site, (ii) to the extent covered in any permit to enter executed by the City, or (iii) to negligent or willful acts or omissions of the City, its employees, officials, representatives or agents.

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18 7.2.5 Period of Indemnification. The obligations for indemnity under this Section

7.2 shall begin upon the Effective Date and shall survive termination of this Agreement, provided the actions or omissions subject to indemnification above shall have occurred prior to termination.

7.3 Waiver of Subrogation. Developer and City each agrees that it shall not make any claim against, or seek to recover from the other or its agents, servants, or employees, for any loss or damage to it or to any person or property relating to this Project, except as specifically provided hereunder which includes but is not limited to, a claim or liability arising from the sole negligence or willful misconduct of the City, its officers, agents, or employees.

8. MISCELLANEOUS PROVISIONS.

8.1 Recordation of Agreement. This Agreement shall be recorded with the County Recorder by the City Clerk within 10 days of execution, as required by Government Code Section 65868.5. Amendments approved by the parties, and any cancellation, shall be similarly recorded.

8.2 Entire Agreement. This Agreement sets forth and contains the entire understanding and agreement of the parties with respect to the subject matter set forth herein, and there are no oral or written representations, understandings or ancillary covenants, undertakings or agreements which are not contained or expressly referred to herein. No testimony or evidence of any such representations, understandings or covenants shall be admissible in any proceeding of any kind or nature to interpret or determine the terms or conditions of this Agreement.

8.3 Severability. If any term, provision, covenant or condition of this Agreement shall be determined invalid, void or unenforceable, then that term, provision, covenant or condition shall be stricken and the remaining portion of this Agreement shall remain valid and enforceable if that stricken term, provision, covenant or condition is not material to the main purpose of this Agreement, which is to allow the Project to be permitted and operated and to provide a public benefit to the City; otherwise, this Agreement shall terminate in its entirety, unless the parties otherwise agree in writing, which agreement shall not be unreasonably withheld.

8.4 Interpretation and Governing Law. This Agreement and any dispute arising hereunder shall be governed and interpreted in accordance with the laws of the State of California.

This Agreement shall be construed as a whole according to its fair language and common meaning, to achieve the objectives and purposes of the parties hereto. The rule of construction, to the effect that ambiguities are to be resolved against the drafting party or in favor of the non -drafting party, shall not be employed in interpreting this Agreement, all parties having been represented by counsel in the negotiation and preparation hereof.

8.5 Section Headings. All section headings and subheadings are inserted for convenience only and shall not affect any construction or interpretation of this Agreement.

8.6 Singular and Plural. As used herein, the singular of any word includes the plural.

8.7 Time of Essence. Time is of the essence in the performance of the provisions of this Agreement as to which time is an element.

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19 8.8 Waiver. Failure of a party to insist upon the strict performance of any of the provisions of this Agreement by the other party, or the failure by a party to exercise its rights upon the default of the other party, shall not constitute a waiver of such party's right to insist and demand strict compliance by the other party with the terms of this Agreement thereafter.

8.9 No Third-Party Beneficiaries. This Agreement is made and entered into for the sole protection and benefit for the Parties, as well as their successors and assigns. No other person shall have any right of action based upon any provision of this Agreement.

8.10 Force Majeure. Notwithstanding anything to the contrary herein, neither party shall be deemed to be in default where failure or delay in performance of any of its obligations under this Agreement is ca used by earthquakes, other acts of God, fires, rains, winds, wars, terrorism, riots or similar hostilities, strikes and other labor difficulties beyond the party's control (including the party's employment force), government actions and regulations (other than those of the City), court actions (such as restraining orders or injunctions), or other causes beyond the party's reasonable control. If any such events shall occur, the term of this Agreement and the time for performance shall be extended for the dur ation of each such event, provided that the term of this Agreement shall not be extended under any circumstances for more than five (5) years and further provided that if such delay is longer than six (6) months, Developer may terminate this Agreement upon written notice to City.

8.11 Mutual Covenants. The covenants contained herein are mutual covenants and also constitute conditions to the concurrent or subsequent performance of the covenants to be performed hereunder by the benefited party.

8.12 Counterparts. This Agreement may be executed by the parties in duplicate counterparts, which counterparts shall be construed together and shall have the same effect as if all of the parties had executed one and the same instrument.

8.13 Litigation. Any action at law or in equity arising under this Agreement or brought by any party hereto for the purpose of enforcing, construing or determining the validity of any provision of this Agreement shall be filed and tried in the Superior Court of the County of Lo s Angeles, State of California, or such other appropriate court in said county. Service of process on City shall be made in accordance with California law. Service of process on Developer shall be made in any manner permitted by California law and shall be effective whether served inside or outside California. In the event of any action between City and Developer seeking enforcement of any of the terms and conditions to this Agreement, the prevailing party in such action shall be awarded, in addition to suc h relief to which such party is entitled under this Agreement, its reasonable litigation costs and expenses, including without limitation its expert witness fees and reasonable attorneys' fees.

8.14 Covenant Not To Sue. The parties to this Agreement, and each of them, agree that this Agreement and each term hereof is legal, valid, binding, and enforceable. The parties to this Agreement, and each of them, hereby covenant and agree that each of them will not commence, maintain, or prosecute any claim, dema nd, cause of action, suit, or other proceeding against any City Council Regular Meeting - Page 311 of 421
20 other party to this Agreement, in law or in equity, which is based on an allegation, or assert in any such action, that this Agreement or any term hereof is void, invalid, or unenforceable.

8.15 Project as a Private Undertaking. It is specifically understood and agreed by and between the parties hereto that the development of the Project is a private activity, that neither party is acting as the agent of the other in any respect hereunder, and that each party is an independent contracting entity with respect to the terms, covenants and conditions contained in this Agreement. No partnership, joint venture or other association of any kind is formed by this Agreement. The only relationship between City and Developer is that of a government entity regulating the development of private property, on the one hand, and the holder of a legal or equitable interest in such property on the other hand. City agrees that by its approval of, and entering into, this Agreement, that it is not taking any action which would transform this private Project into a "public work" project, and that nothing herein shall be interpreted to convey upon Developer any benefit which would transform Developer's private project into a public work project, it being understood that this Agreement is entered into by City and Developer upon the exchange of consideration described in this Agreement, including the Recitals to this Agreement which are incorporated into this Agreement and made a part hereof, and that City is receiving by and through this Agreement the full measure of benefit in exchange for the burdens placed on Developer by this Agreement.

8.16 Further Actions and Instruments. Each of the parties shall cooperate with and provide reasonable assistance to the other to the extent contemplated hereunder in the performance of all obligations under this Agreement and the satisfaction of the conditions of this Agreement.

Upon the request of either party at any time, the other party shall promptly execute, with acknowledgment or affidavit if reasonably required, and file or record such required instruments and writings and take any actions as may be reasonably necessary under the terms of this Agreement to carry out the intent and to fulfill the provisions of this Agreement or to evidence or consummate the transactions contemplated by this Agreement.

8.17 Eminent Domain. No provision of this Agreement shall be construed to limit or restrict the exercise by City of its power of eminent domain or Developer's right to seek and collect just compensation or any other remedy available to it.

8.18 Amendments in Writing/Cooperation. This Agreement may be amended only by written consent of both parties specifically approving the amendment and in accordance with the Government Code provisions for the amendment of development agreements. The parties shall cooperate in good faith with respect to any amendment proposed in order to clarify the intent and application of this Agreement and shall treat any such proposal on its own merits, and not as a basis for the introduction of unrelated matters. Non -substantive amendments to the Development Approvals may be approved without amending this Agreement as provided in Section 3.5.

8.19 Corporate Authority. The person(s) executing this Agreement on behalf of each of the parties hereto represent and warrant that (i) such party, if not an individual, is duly organized and existing, (ii) they are duly authorized to execute and deliver this Agreement on behalf of said party, (iii) by so executing this Agreement such party is formally bound to the provisions of this City Council Regular Meeting - Page 312 of 421
21 Agreement, and (iv) the entering into this Agreement does not violate any provision of any other agreement to which such party is bound.

8.20 Notices. All notices under this Agreement shall be effective when delivered by United States Postal Service mail, registered or certified, postage prepaid return receipt requested; and addressed to the respective parties as set forth below or as to such other address as the parties may from time to time designate in writing by providing notice to the other party:

To City: City of Lynwood
11330 Bullis Road
Lynwood, CA 90262
Attn: City Manager
With Copy to: Alvarez-Glasman & Colvin
13181 Crossroads Parkway North, Suite 400
City of Industry, CA 91746
Attn: Noel Tapia, City Attorney

To Developer Bulletin Display, LLC
Official Land Lease Notice
3127 E. South Street, Suite B
Long Beach, CA 90805
Attn: Mark A. Kudler

8.21 Nonliability of City Officials. No officer, official, member, employee, agent, or representatives of City shall be liable for any amounts due hereunder, and no judgment or execution thereon entered in any action hereon shall be personally enforced against any such officer, official, member, employee, agent, or representative.

8.22 No Brokers. City and Developer represent and warrant to the other that neither has employed any broker and/or finder to represent its interest in this transaction. Each party agrees to indemnify and hold the other free and harmless from and against any and all liability, loss, cost, or expense (including court costs and reasonable attorneys' fees) in any manner connected with a claim asserted by any individual or entity for any commission or finder's fee in connection with this Agreement or arising out of agreements by the indemnifying party to pay any commission or finder's fee.

8.23 No Amendment of Lease. Nothing contained in this Agreement shall be deemed to amend or modify any of the terms or provisions of the Lease. Nothing contained in this Agreement shall constitute or be deemed to constitute a limit on any of Developer's obligations under the Lease.

8.24 Counterparts. This Agreement may be signed in any number of duplicate counterparts, each of which, when combined, shall constitute one and the same document.

(Signatures on Next Page)
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22 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first set forth above.

“City”

CITY OF LYNWOOD

Date:______________ ____________________________________ Jorge Casanova , Mayor

ATTEST:

_______________________________
Maria Quinonez, City Clerk

APPROVED AS TO FORM

_______________________________
Noel Tapia, City Attorney

“Developer”

BULLETIN DISPLAYS, LLC

Date:______________ ____________________________________ Its: Mark A. Kudler

[Principle Signatures to be Notarized]

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23 EXHIBIT A

LEGAL DESCRIPTION OF THE PROPERTY
(See Following Page)

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24 11104-06 Wright Rd. Lynwood, CA 90262; also known as Los Angeles County Assessor’s No. 6194-029-006

LEGAL

PARCEL 1,
The Southerly 80 feet of the Northerly 140 feet of the following described land:

That portion of Lot 4 o f the Downey and Hellman Tract, in the City of Lynwood, as per map recorded in Book 3, Page 31 of Miscellaneous Records, in the Ottice of the county Recorder of said County, together with that portion of the Rancho San Antonio, in said City, County and State, described as follows:

Beginning at a point in the westerly line of the Los Angeles County Flood Control District, right-of-way, as per deed recorded in Book 7077, Page 176 of Deeds, in said County Recorder’s office, distant thereon North 6° 55’ 46" East, 100.45 feet from the intersection thereof with the North line of the land described in the deed to Ebeneser Burr, recorded in Book 11698 Page 101 of Official Records in said County Recorder’s Officer; thence north 76° 47' 30” West, 106,13 feet to the true point or beginning; thence North 5° 21’ 07” West 81.00 feet to the b eginning of a curve, concave We sterly, having a radius of 2890,00 feet: thence Northerly along said curve, through an angle of 10° 13' 45", an arc distance of 515,96 feet to a point on the South line of Lot 4 of the Downe y and Hallman Tract, as per map recorded in Book 3, Page 31 of Miscellaneous Records, in said Office at the County Recorder, distant thereon south 83° 48' 03" East l71,01 feet from the intersection of said South line with the East line of Wright Road, 50,0o feet wid e, as shown on map of Tract No. 10634, recorded in Book 165, Pages 40 to 4 2, inclusive of Maps, records of said County; thence continuing Northerly along said curve to a line which bears North 74° 51' 26" East, from a point in the southerly line of said Lot 4, that is distant thereon South 83° 46’ 03” East 67.35 feet from the East line of said Wright Road thence South 74° 51’ 26” West 158,72 feet, more or less, to the East line of said Wright Road; thence along said East line, South 15° 08’ 34” East 313.73 feet, more or less, to an angle point therein; thence continuing along said East line, South 19° 08’ 58” West 231.74 feet, more or less, to a point that is distance thereon North 19° 08’ 58” East 131.00 feet from the most Northwesterly corner of the land described in said deed to Ebenezer Burr; thence south 76° 47' 30" East 265.62 feet, more or less, to the true point of beginning,

PARCEL 2:

An easement for building and party wall ove r the Nor therly six and one -halt inches of the following described land:

The Southerly 100 feet of the Northerly 240 feet of that portion of Lot 4 of the Downey and Hellman Tract, in the City of Lynwood, as per map recorded in book 3, Page 31 of Miscellaneous Records in the Office of the County Recorder of said County, together with that portion of the Rancho San Antonio, in the said City, County and State, descried as follows:

Beginning at a point in the Westerly line of the Los Angeles County Flood Control District, Right-of-Way, as per map recorded in B ook 7077, Page 176 of Deeds, in said county Recorder ’s Office, distant thereon North 6° 55’ 45" East, 100,45 feet from the intersection thereof with the North line of the land described in the De ed to Eben ezer Burr , re corded in Book 11 698, Page 101 o f Official Re cords, in said County Recorder’s Office; then North 76° 47’ 30" West, 106.13 feet to the true point c urve concave Westerly, having a radius of 2890,00 feet ; thence Northerly along said curve though an angle of 10° 13' 45”, an arc distance of 515.96 feet to a point on the South line of Lot 4 of the Downey and Hellman Tract, as per map thereof recorded in Book 3, Page 31 of Miscellaneous Record s, in said office of th e Recorder, distant City Council Regular Meeting - Page 316 of 421
25 thereon South 83° 48’ 03” East 171.01 feet from the intersection of said South line with the East line of Wright Road, 50.00 feet wide, as shown on Map of Tract No. 10634, recorded in Book 165, Pages 40 to 42, inclusive of Maps, Records of said County; thence continuing Northerly along said curve to a line which bears North 74° 51’ 26" East from a point in the Southerly line of said Lot 4, that is distant thereon South 83° 48' 03" East 67,35 feet from the East line of said Wright Road; thence South 74° 51’ 26” West 158. 72 feet, more or less, to the East line of said Wright Road; thence along said East line, South 15° 08’ 34” East 313.73 feet, more or less, to an angle point therein; thence continuing along said East line, south 19 ° 08’ 58” West 231,24 feet, more or less, to a point that i s distant thereon North 19° 08’ 58” East 131.00 feet from the most Northwesterly corner of the land described in said Deed to Ebenezer Burr; thence south 76° 47’ 30" East 265.62 feet, more or less, to the true point of beginning.

That portion of the Rancho San Antonio, in said City, County and State, described as follows:

Commencing at a point in the Westerly line of the Los Angeles County Flood Control District, right of way, as per deed recorded in Book 7077, page 176 of Deeds, in said county Recorder's office, distant thereon N 6° 55' 46" E, 100.45 feet from the intersection thereof with the North line of the land described in the deed to Ebeneser Burr, recorded in Book 11698, page 101 of Official Records, in said County Recorder's office; thence N 76° 47' 30" W, 106.13 feet: thence N 5° 21' 07" W 81,00 feet to the beginning of a curve, concave Westerly, having a radius of 2890,00 feet; thence Northerly along said curve, through an angle of 10° 13’ 45", an arc distance of 515,96 feet to a point on the south line of Lot 4 of the Downey and Hellman Tract, as per map recorded in Book 3, Page 31 of Miscellaneous Records, in said office of the Recorder, distant thereon S 83° 48' 03” E 171,01 feet from the int ersection of said South line with the East line o! Wright Road, 50.00 feet wide, as shown on map of Tract No. 10634, recorded in Book 165, pages 40 to 42, inclusive of Maps, records of said county; thence continuing Northerly along said curve to a line which bears N 74° 51’ 26" E, from a point in the Southerly line of said Lot 4, that is distant thereon S 83° 48’ 03” E 67,35 feet from the East line of said Wright Road; thence Southerly along said curve having a radius of 2890,00 feet through an angle of 10° 13' 45", an arc distance of 60.01 feet to a lin e parallel with and distant Southerly 60,00 feet, measured at right angles from said line which bears N 74° 51' 26" E, and being the TRUE POINT OF BEGINNING of this description ; thence along said parallel line S 74° 51’ 26" W, 10.00 ; thence Southerly in a direct line to a point in a line parallel with said last mentioned parallel line and distant Southerly 80.00 feet measured at right angles therefrom, and being distant along said last mentioned parallel line S 74 ° 51’ 26” W, 17.07 feet from said curve having a radius of 2890.00 feet, thence along last mentioned parallel line N 74° 51’ 26" E, 17.07 feet to said curve; thence Northerly along said curve an arc distance of 80.00 feet to said TRUE POINT OF BEGINNING.

There shall be no abutter’s rights of access appurtenant to the above­described real property in and to the adjacent State Freeway.

SUBJECT TO THE EXCEPTION THEREFROM, all oil, oil rights, minerals, mineral right s, natural gas, natural gas rights, and ot her hydrocarbons by whatsoever name known that may b e within or under the herein conveyed parcel of land and the rights thereto, together with certain other conditions, as excepted in deed (State Parcel 61657), to the state of California recorded May 28, 1 971, in Book 05072, page 259 of official Records in said office.

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26 EXHIBIT B

SITE PLAN

(See Following Page)
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27 City Council Regular Meeting - Page 319 of 421
28 EXHIBIT C

ELEVATIONS

(See Following Page)
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29 City Council Regular Meeting - Page 321 of 421
30 EXHIBIT D

FORM FOR THE ANNUAL STATEMENT OF ANNUAL NET REVENUES

(See Following Page)

Form is an example and some descriptions can change
City Council Regular Meeting - Page 322 of 421
31 City Council Regular Meeting - Page 323 of 421
Agenda Item # 23.

AGENDA STAFF REPORT
DATE:

August 2, 2022

TO:

Honorable Mayor and Members of the City Council

APPROVED BY:

Ernie Hernandez, City Manager

PREPARED BY:

John Yonai, Interim Director of Community Development

SUBJECT:

CONDUCT SECOND READING, READ BY TITLE ONLY, AND WAIVE FURTHER

READING, AND ADOPT AN ORDINANCE APPROVING A DEVELOPMENT

AGREEMENT (DA) BETWEEN THE CITY OF LYNWOOD AND BULLETIN

DISPLAYS, LLC FOR THE DEVELOPMENT OF EITHER A NEW BACK-TO-BACK OR V-SHAPED DIGITAL BILLBOARD AT 11350 WRIGHT ROAD, LYNWOOD ASSESSOR’S PARCEL NUMBER 6194-031-007
Recommendation:

Staff recommends that the City Council:

Conduct second reading, read by title only, and waive further reading, and adopt, the attached Ordinance entitled “AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LYNWOOD FOR APPROVAL OF THE

DEVELOPMENT AGREEMENT BETWEEN THE CITY OF LYNWOOD AND BULLETIN DISPLAYS, LLC

FOR THE DEVELOPMENT OF EITHER A NEW BACK-TO-BACK OR V-SHAPED DIGITAL BILLBOARD AT 11350 WRIGHT ROAD, LYNWOOD (ASSESSOR’S PARCEL NUMBER 6194-031-007)”

Background:

Bulletin Displays, LLC (herein referred to as the “Applicant”) has submitted a Site Plan Review application (SPR) to construct a new 75-foot tall, V-structure, digital billboard (herein referred to as the “billboard”) consisting of a total billboard sign area of 1,344 square feet (14’ x 48’ or 672 square feet per billboard sign face). The proposed 75 feet is measured from the base of the sign to the top of the 14-foot sign face. The applicant is proposing an additional 10 feet of height (85 feet) to accommodate the proposed sign’s artwork beyond the sign display.

Signage aesthetics and the potential height increase as described above will be further reviewed by staff and the matter may be returned to the Planning Commission if Bulletin Display, LLC’s proposed billboards at 11104-06 Wright Road and 11350 Wright Road are drastically different from the other. Staff is recommending that the billboards match the exterior design of the other similar to the color rendering portrayed for the 11104-11106 Wright Road location.

The project plans reflect a V-structure sign and the applicant is requesting to reserve the right to exercise an option to install either their proposed V-structure sign or a back-to-back design and sign display. The applicant will City Council Regular Meeting - Page 324 of 421
communicate his position on this matter for consideration by Commission.

The subject billboard is proposed to be supported by a single supporting post immediately adjacent and west of the Interstate 710 Freeway corridor. The proposed billboard is proposed to be located at 11350 Wright Road (APN
6194-031-007
) and approximately 550 feet southwest of the Wright Road and Martin Luther King Jr.

Boulevard intersection. A note for reference, a smaller parcel (APN 6194-031-014) with a varying width of 29 to 44 feet lies between the subject site and the I-710 Freeway (refer to image below)

The subject site is also characterized as a generally rectangular-shaped, non-sloping site that maintains one (1) industrial structure operating a welding shop. The site is zoned (M) Manufacturing with a General Plan’s Manufacturing land use designation.

The project corridor is located within the northeast area of the City and along the portion of the I-710 Freeway between E. Imperial Highway and Martin Luther King Jr. Boulevard. The City has two (2) designated freeway- oriented billboard corridors within the City: I-105 Freeway and I-710 Freeway. Off-site digital billboards are permitted within these corridors subject to Zoning Code development standards and the approval of a Development Agreement (DA) by the City Council.

PROJECT

Pursuant to Lynwood Municipal Code Section 25-70-14 “Off-Site Outdoor Advertising Displays” of the Lynwood Municipal Code, proposed off-site outdoor advertisement billboards and DAs are subject to City Council decision. A DA (Attachment A) was prepared for the subject, new digital billboard located at 11350 Wright Road (APN 6194-031-007) and immediately adjacent to and west of the I-710 Freeway as shown the below aerial map (Attachment D).

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The project site is comprised of one (1) parcel with a lot area of approximately 66,188 square feet or approximately 1.5 acres. The project site is located in Manufacturing (M) zone, wherein the Lynwood Municipal Code specifically and conditionally permit off-site outdoor advertising displays (billboards) by the process described in Section 25-70-14.

The new electronic billboard will consist of V-structure (or “V” shaped) displays and will be visible from both north and south bound I-710 Freeway lanes. The new billboard’s size, design, lighting, messages and timing of messages will be consistent with the parameters described in DA. The Applicant shall comply with State law regarding the limitation of light and glare or such other standards as adopted by the Federal Highway Beautification Act and the State's Outdoor Advertising Act. Standards include, but are not limited to, the 0.3 foot- candles limitation over ambient light levels ensuring additional flexibility in reducing such maximum light level standard given existing conditions, including the obligation to incorporate automatic diming capabilities. Each message on the new digital billboard displays shall be displayed for at least eight (8) seconds.

Standard City conditions of approval and site requirements are included as findings confirmed in the positive from section Lynwood Municipal Code 25-130-5.

Environmental Determination
Pursuant to the State CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, sections: 15063 of the California Environmental Quality Act (CEQA) guidelines, the project completed an Initial Study review and a Mitigated Negative Declaration (MND) was completed pursuant to Section 15064(f)(2) of CEQA guidelines. The impacts associated with a Mitigated Negative Declaration was prepared as the conclusions of the Initial Study determined that the project may cause potentially significant impacts on the environment without mitigation.

Discussion and Analysis:

Draft Development Agreement (DA)
State Law allows cities to enter into DAs with private parties. The DA is a legal, binding contract between a city and any person or entity having a legal or equitable interest in a property. The agreement must clearly outline conditions, terms, restrictions and requirements. Once a DA is approved by the City Council, the rules of development for that property cannot change even if the zoning code or other development codes are changed.

DAs are often used in large, complex project and/or in project that have a long lead-time, multiple phases, or long development period, in order to give the developer certainty in regards to the entitlements and other governmental actions.

Under the DA Statute (Government Code Sections 65864-65869.5), cities have a right to enter agreements with private parties to strengthen the public planning process, encourage private participation in comprehensive planning and reduce the economic risk of development. A Development Agreement provides the developer with certain vested rights to develop the property in accordance with zoning laws and entitlements in effect on the date City Council Regular Meeting - Page 326 of 421
of the Development Agreement for a specified period of time. In this case three years. This provides the Developer with assurance that the City will not change the terms of development during construction of the project.

It also provides the City with assurance that the development will be completed in a timely manner. DAs are often used in large, complex projects and in projects that have a long lead-time, multiple phases, or a long development period, in order to give the developer certainty in regards to the entitlements and other governmental actions.

There may also be a “business deal” component to a DA, where a city may agree to undertake certain actions to help a project in return for other considerations from a developer, sometimes financial. Once a DA is approved by the City Council, the rules of development for that property cannot change even if the zoning code or other development codes are changed.

The most important parts of DAs are the financial and non-financial deal points that are agreed upon between the City and the Applicant. There are no established rules or policies when negotiating these deal points as each proposal is unique and should be considered on its own merits. The following provides a brief discussion of each of the major deal points:

1. Term - The Agreement shall continue in full force and effect for thirty (30) years from the effective date; and this Agreement may be extended by mutual agreement between the parties at the end of the initial term.

2. Fees - The potential impacts of the Development on the City and surrounding community are difficult to identify and calculate. As such, the Applicant and City agree that a minimal annual development fee of $75,000.00 be paid by Applicant to City in years 1 to 10, $100,000.00 to be paid by Applicant to City in years 11 to 20 and $120,000.00 to be paid by Applicant to City in years 21 to 30 will be paid to address and mitigate potential impacts. Applicant development fee shall become due and payable upon the Digital Display becoming operational. In addition to the minimal annual fee payment, the City will receive the difference between 10% of net annual revenue and the minimal annual fee. Therefore there is a potential, subject to advertising success, that the City will receive additional fees above the annual amounts noted above.

3. Public Benefits - The digital billboard is expected to generate the following public benefits: City’s Display Time on New Digital Billboard. To the extent that commercial advertising time on the Billboard is unsold and available, Applicant shall provide up to five percent (5%) of total advertising time, free of charge to City, for public service announcements of noncommercial city-sponsored civic events (“City Messages”). City will be responsible for appropriate artwork for the digital displays pursuant to art specifications as specified by Applicant from time-to- time.

4. Prohibited advertising - Developer shall not utilize any of the displays on the new digital billboard to advertise tobacco, marijuana, hashish, “gentlemen’s clubs,” or other related sexually explicit or overly sexually suggestive messages, or as may be prohibited by any City ordinance existing as of the Effective Date of the DA.

Fiscal Impact:

The city shall annually receive in years 1 to 10 $75,000 or a total of $750,000, years 11 to 20 $100,000 or a total of $1,000,000, and years 21 to 30 $120,000 or a total of $1,200,000.

Over the 30 year term the city will generate approximately $2,950,000.

Coordinated With:

City Attorney's Office
ATTACHMENTS:

Description
Attachment A - Ordinance
Attachment B - Draft Development Agreement
City Council Regular Meeting - Page 327 of 421
1 ORDINANCE NO. 1749

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LYNWOOD

FOR THE APPROVAL OF THE DEVELOPMENT AGREEM ENT

BETWEEN THE CITY OF LYNWOOD AND BULLETIN DISPLAYS, LLC

FOR THE DEVELOPMENT OF EITHER A NEW BACK-TO-BACK OR V-
SHAPED DIGITAL BILLBOARD AT 11350 WRIGHT ROAD, LYNWOOD
(ASSESSOR’S PARCEL NUMBER 6194-031-007)

WHEREAS, the Applicant, Bulletin Displays, LLC and (“Applicant”) submitted a request to allow the installation and operation of either a new, back-to-back or v-shaped digital billboard at 11 350 Wright Road, Lynwood, Assessor’s Parcel Number 6194-031- 007 (“Subject Property”);

WHEREAS, On May 10, 2022, the City Planning Commission, by Resolution No. 3445 approved the proposed billboard 75-foot-tall (as measured from the apex of the adjacent freeway to the top of the 14 -foot sign face), either a back-to-back or v-shaped digital billboard consisting of a total sign area of 1,344 square feet (14’ x 48’ or 672 square feet per billboard sign face). The subject billboard is proposed to be supported by a single supporting post;

WHEREAS, the use of this newer electronic billboard technology allows for image change instantaneously, with no special effects, video, flashing, or movement, limiting distraction to drivers on Interstate 710 Freeway corridor;

WHEREAS, the Applicant has negotiated a Development A greement (DA) and attached hereto as Exhibit “A”. An approved Development Agreement between the City and the Applicant, Bulletin Displays, LLC , will offer the City the ability to extract improvements or benefits for the City that are not possible by way of a site plan review;

WHEREAS, pursuant to the State CEQA Guidelines, a Mitigation Negative Declaration was published with State Clearing House and posted as required by State Law from January 14, 2022 to February 15, 2022;

WHEREAS, On May 10, 2022, the City Planning Commission, by Resolution No 3445, approved an Initial Study review and a Mitigated Negative Declaration (MND) No. 2021-45 in compliance with the State California Environmental Quality Act (CEQA) guidelines, California Code of regulations, Title 14, Chapter 3, sections: 15063 and 15064(f)(2). The City Council adopts the findings and CEQA approval of the Planning Commission as its CEQA determination for consideration of the Development Agreement;

WHEREAS, On May 10, 2022, the City Planning Commission adopted Resolution 3445 approving Site Plan Review No. 2021-45, Mitigated Negative Declaration No. 2021- 45, and the project’s associated Development Agreement;

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2 WHEREAS, on May 10, 2022, the Planning Commission held a d uly noticed and advertised public hearing to receive oral and written testimony related to the Development Agreement and suffi ciently considered all testimony presented to them in order to recommend approval of the DA to the City Council.

WHEREAS, the Planning Commission recommends the adoption the Bulletin Displays, LLC ’s billboard project’s Mitigated Negative Declaration No. 20 21-45 and Mitigation Monitoring Program;

WHEREAS, in accordance with the Lynwood Municipal Code Section 25 -70-14, the Planning Commission will review and provide recommendation to City Council for Development Agreement approval consideration; and

WHEREAS, the Planning Commission, upon giving the required notice did, on the 10th day of May 2022, conduct a duly-advertised public hearing as prescribed by law to consider Site Plan Review No. 2021-45, Mitigated Negative Declaration No. 2021-45, and Development Agreement, at which time evidence, both oral and written, including a staff report were presented and received, and comments were heard from all interested parties appearing in the matter.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Lynwood as follows:

SECTION 1. The City Council hereby finds and determines that The Development Agreement is consistent with the City General Plan and the “Manufacturing” general plan designation. The Findings of Approval associated with the Planning Commission Resolution No 3445, Site Plan Review No. 2021 -45 and Mitigated Negative Declar ation No. 2021-45, respectively, adopted by the Planning Commission on May 10, 2022 are adopted herein by reference as further support for approval of the Development Agreement.

SECTION 2. State Law allows cities to enter into a Development Agreements with private parties. The Development Agreement is a legal and biding contract between a city and any person or entity having a legal or equitable interest in a property. The agreement provides the developer with certain vested rights to develop the property in accordance with the zoning laws and entitlements in effect on the date of the Development Agreement for a specific period of time. The DA will terminate in three (3) years if the project is not completed.

SECTION 3. The DA provides the Developer with assurance that the City will not change the terms of development during construction of the project. It also provides the City with assurance that the development will be completed in a timely manner.

SECTION 4. Once a Development Agreement is approved by the Lynwood City Council, the rules of development for that property cannot change even if the zoning code or other development codes are changed.

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3 SECTION 5 . Based on the above recitals, the staff report accompanyi ng this Ordinance and public comments, the City Council of the City of Lynwood hereby finds the project to be consistent with the goals, policies, and objectives of the land use element, the land use plan of the City’s general plan and that the project will not a dversely affect the surrounding properties.

SECTION 6. The City Council of the City of Lynwood hereby approves the Development Agreement to allow the proposed billboard 75-foot-tall (as measured from the apex of the sign to the top of the 14 -foot sign face), back-to-back digital billboard consisting of a total sign area of 1,344 square feet (14’ x 48’ or 672 square feet per billboard sign face) . The subject billboard is proposed to be supported by a single supporting post subject to the conditions per Resolutions No.3445 (Site Plan Review No. 2021-45 and Mitigated Negative Declaration No. 2021-45).

SECTION 7. If any section, subsection, clause or phrase of this Ordinance is for any reason, held to be unconstitutional, or otherwise invalid, such decision shall not affect the validity of the remaining sections of this Ordinance. The City Council hereby finds that it would have passed this Ordinance and each section, subsection, sentence, clause and phrase thereof irrespective of the fact that any one or more other sections, subs ections, sentences, clauses or phrases be declared unconstitutional or invalid.

SECTION 8. This Ordinance shall take effect on the thirty -first (31st) day after its adoption.

Section 9. The City Clerk shall certify as to the adoption of this Ordinance and shall cause the Ordinance to be posted or published as required by law.

PASSED, APPROVED AND ADOPTED this 2nd day of August, 2022.

________________________________
Jorge Casanova
Mayor

ATTEST:

_____________________________ ________________________________ Maria Quiñonez Ernie Hernandez
City Clerk City Manager

APPROVED AS TO FORM:

_______________________________
Noel Tapia
City Attorney
City Council Regular Meeting - Page 330 of 421
4 STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, do hereby certify that the foregoing Ordinance was passed and adopted by the City Council of the City of Lynwood at a regular meeting held on the ___ day of ______ , and passed by the following votes:

AYES:

NOES:

ABSTAIN:

ABSENT:

_______________________________________
Maria Quiñonez, City Clerk

STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, and the Clerk of the City Council of said City, do hereby certify that the above foregoing is a full, true and correct copy of the Ordinance No. __________ on file in my office and that said Ordinance was adopted on the date and the vote therein stated. Date this____ day of _____.

_______________________________________
Maria Quiñonez, City Clerk

City Council Regular Meeting - Page 331 of 421
1 Recording Requested by and
When Recorded Return to:

CITY OF LYNWOOD
11330 Bullis Road
Lynwood, CA. 90262
Attn: City Clerk
[Exempt From Recording Fee Per Gov. Code § 27383]
DEVELOPMENT AGREEMENT NO.

This Development Agreement (“Agreement”) is entered into this day ___________________ of , 2022, (“Effective Date”) by and between the CITY OF LYNWOOD, a California municipal corporation (“City”) and Bulletin Displays, LLC (“Developer”).

RECITALS
A. California Government Code Sections 65864, et seq., (“Development Agreement Law”) authorizes cities to enter into binding development agreements with persons having a legal or equitable interest in real property for the development of such property, all for the purposes of strengthening the public planning process, encouraging private participation and comprehensive planning and identifying the economic costs of such development.

B. Developer has a long -term leasehold interest (“ Site”) in a portion of the real property commonly known as 11350 Wright Road, in the City of Lynwood, in the County of Los Angeles (Assessor’s Parcel Number 6194 -031-007) (the “Property”), as more specifically described in Exhibit “A”, which Property is approximately 1.53 acres in size and is improved with a commercial building, along with parking, landscaping and related improvements. Developer’s Site is located near the eastern boundary of the Property and is adjacent to and visible from the 710 Freeway, as depicted on each Site Plan attached as Exhibit “B”.

C. Developer seeks to install on the Site a 75 foot tall billboard (“Billboard”) , as measured from the apex of the adjacent 710 Freeway to the top of the display face, containing a double-sided L.E.D. display (“Digital Display”), each face measuring 14 feet x 48 feet from the base of the display as depicted on Exhibit “C”, pursuant to the terms of this Agreement. In this Agreement, the Billboard and each Digital Display are somet imes referred to collectively as “Billboard” and sometimes the “Digital Display” is referred to specifically.

D. In exchange for the City’s approval to install the Billboard and the Digital Display thereon, and in order to mitigate any impacts associated with the installation, Developer agrees to:

1. Pay to the City a development fee and provide other public benefits as set forth in Section 2.5 below, and
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2 2. Install an illuminated sign on the Billboard naming the City of Lynwood at no cost to City with the final design agreed to between the City and Developer; and

3. Agree not to advertise on the Digital Display any content contrary to the provisions of Section 2.7 below.

E. The Site is located in the City’s Manufacturing zone and has a General Plan designation of Industrial.

F. The Project, as defined below, requires a Site Plan approval, which Developer is pursuing through a duly-filed sign review approved by the City concurrently herewith.

G. Developer and City Agree that this Agreement should be approved and adopted to memorialize the expectations of City and Developer as more particularly described herein.

H. On May 10, 2022, the Planning Commission of the City, at a duly noticed hearing to consider the approval of this Agreement, adopted Resolution No. ____________ recommending approval of this Agreement to the City Council and find the Project, as defined below, categorically exempt from the provisions of the California Environmental Quality Act (“CEQA”) pursuant to Section 15332 regarding Urban In-Fill Development Projects.

I. On _________, ____ 2022, the City Council of the City, at a duly noticed hearing to consider the approval of this Agreement, considered the proposal, heard testimony, and introduced Ordinance No. _______, subject to referral of consideration of the matter by the Planning Commission.

J. The City Council has found that this Agreement is in the best public interest of the City and its residents, that adopting this Agreement constitutes a present exercise of the City’s police power, and that this Agreement is consistent with the City’s General Plan. This Agreement and the proposed Project, as defined below, will achieve a number of City Objectives and public benefits.

K. On ________________, 2022, the City Council held the second reading of Ordinance No. _________, hereby approving this Agreement.

L. City finds and determines that all actions required of City precedent to approval of this Agreement by Ordinance No. _________of the City Council have been duly and regularly taken.

COVENANTS
NOW, THEREFORE, in consideration of the above recitals (which are incorporated into this Agreement as if set forth in full herein) of the mutual covenants hereinafter contained and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1. DEFINITIONS AND EXHIBITS

1.1 Definitions. This Agreement uses a number of terms having specific meanings, as defined below. These specially defined terms are distinguished by having the initial letter City Council Regular Meeting - Page 333 of 421
3 capitalized, when used in the Agreement. In Addition to the terms defined in the Recitals above, the defined terms include the following:

1.1.1 “Agreement” means this Development Agreement and all attachments and exhibits hereto.

1.1.2 “Annual Net Revenue” means all income actually received by Developer in connection with the Billboard (net of any commissions paid by Developer to advertising agencies or brokers , not to exceed 16 -2/3%). For the purposes hereof, any income described in this definition will not include the value of any in-kind usage of the Billboard by the City pursuant to Section 2.6 or any other in-kind usage for political messages or for public service messages from nonprofit organizations or for nonpaying clients who are testing the sign or given bonuses.

1.1.3 “Billboard” and “Digital Display” shall have the meanings ascribed in the Recital above

1.1.4 “City” means the City of Lynwood, a California municipal corporation and a general law city.

1.1.5 “City Council” means the City Council of the City.

1.1.6 “Developer” means Bulletin Displays, LLC, duly existing and operating and its successors and assigns, as further described in Section 8.20.

1.1.7 “Development Approval” means the approved Project, based on the approval of the City Council, as further described at Recital G and Section 3.3 herein.

1.1.8 “Effective Date” means the date inserted into the preamble of this Agreement, which is 30 days following approval of this Agreement by ordinance of the City Council, provided the Agreement is signed by the Developer and the City.

1.1.9 “Final Permits” shall be when all approvals necessary to construct the Billboard and the Digital Displays have been obtained from all applicable governmental and quasi- governmental authorities, including but not limited to any and all permits a nd approvals required by: (i) the Lynwood Municipal Code; (ii) the California Department of Transportation (“Caltrans”) pursuant to the California Outdoor Advertising Act; (iii) applicable utilities affected by the construction; and (iv) CEQA and the State CEQA Guidelines.

1.1.10 “Land Use Regulations” means all ordinances, resolutions, codes, rules, regulations and official policies of City, including, but not limited to, the City’s General Plan and Municipal Code, which govern the development and use of the Site, including, without limitation, the permitted use of land, the density or intensity of use, subdivision requirements, the maximum height and size of the Billboard, the provisions for reservation or dedication of land for public purposes, and the design, improvement and construction standards and specifications applicable to the Development of the Billboard at the Site which are in full force and effect as of the Effective City Council Regular Meeting - Page 334 of 421
4 Date of this Agreement. Land Use Regulations shall also include National Pollutant Discharge Elimination System (“NPDES”) regulations, to the extent applicable.

1.1.11 “Lease” means the agreement between Developer and the Property owner granting Developer the legal right to install, operate and maintain the Billboard and Digital Display at the Site.

1.1.12 “Operational” means , the date that all L.E.D. panels of the Digital Display are capable, legally and functionally, of displaying advertising or issuance of all governmental and Southern California Edison approvals, whichever is sooner.

1.1.13 “Project” means the installation, operation and maintenance of the Digital Display on the Billboard on the Site, all in accordance with the Development Approvals, and this Agreement.

1.1.14 “Site” shall have the meaning ascribed in Recital “B”, above.

1.1.15 “Subsequent Land Use Regulations” means any Land Use Regulations that take effect after the Effective Date of this Agreement which may govern the Project.

1.1.16 “Term” shall have the meaning provided in Section 2.4, unless earlier terminated as provided for in this Agreement.

1.2 Exhibits. The following documents are attached hereto and are by this reference made a part of this Agreement:

Exhibit “A” (Legal Description of Property)
Exhibit “B” (Site Plan)
Exhibit “C” (Digital Display and Billboard Elevations)
Exhibit “D” (Form for the Annual Statement of Annual Net Revenues)

2. GENERAL PROVISIONS.

2.1 Binding Effect of Agreement. From and following the Effective Date, actions by the City and Developer with respect to the Project, including actions by the City on application for subsequent Development Approvals affecting the Site, shall be subject to the terms and provisions of this Agreement; provided however, that nothing in this Agreement shall be deemed or construed to modify or amend the Lease, or any of the Developer’s obligations thereunder.

2.2 Interest in Site. City and Developer acknowledge and agree that Developer has a legal or equitable interest in the Site and is thus qualified to enter into an d be a party to this Agreement under Development Agreement Law. Additionally, prior to the execution of this Agreement, Developer has allowed City to view a redacted copy of the Lease, which demonstrate that Developer has a long -term leasehold interest in the Site, which interest shall be maintained during the Term of this Agreement, at the discretion the Developer. If Developer’s interest in the Lease is prematurely terminated, Developer may assign this Agreement as provided in Section 2.3, below. If Developer extends the Lease beyond the Term of this Agreement and this Agreement is City Council Regular Meeting - Page 335 of 421
5 not extended to the new Lease expiration date by the City, at the expiration of this Agreement, If Developer’s interest in the Lease terminates before the expiration of this Agreement and Developer is not able to Assign this Agreement as provided in Section 2.3, Developer will remove the Billboard and Digital Display and sign a written cancellation of this Agreement, as provided in Section 4.1.

2.3 Assignment. Developer shall not assign or otherwise transfer this Agreement, or its interest in the Site to any other person, firm, or entity , without City’s written consent, which shall not be unreasonably withheld. An assignment of this Agreement shall be to a party that has demonstrated positive experience operating billboards similar to the Project, and who can provide evidence of adequate financial resources and expertise in securing advertisers for billboards similar to the Project. Developer shall notify City no later than ninety (90) days prior to any such proposed assignment and provide all documentation necessary for City to verify compliance with this requirement. Any transfer not meeting the requirements in this Section 2.3 shall be subject to the approval of the City Council. Any security posted by Developer may be substituted by the assignee or transferee. The prohibition against an assignment without reasonable City’s approval shall not be required for, or deemed to prevent , (i) the renting or subleasing or licensing of space for advertisements or displays consistent with the customary uses and practices for billboards and message boards or (ii) the assignment of this Agreement to any affiliate of Developer or joint venture in which Developer participates provided that Developer submits evidence satisfactory to City that the principals who own and control Developer will maintain a majority controlling interest after consummation of such transaction and will have the ability to maintain a majority controlling interest throu ghout the Term, (iii) Developer, in any manner, at Developer’s sole discretion, from encumbering Sites or any portion thereof or the Development or any improvement on the Sites thereon by any mortgage, deed of trust or other security device securing financ ing with respect to the Sites. The City acknowledges that the lenders providing such financing may require certain Agreement interpretations and modifications and the City agrees upon request, from time to time, to meet with Developer or Owner and representatives of such lenders to negotiate in good faith any such request for interpretation or modification. Subject to compliance with applicable laws, the City will not withhold its consent to any such requested interpretation or modification, provided the City determines such interpretation or modification is consistent with the intent and purposes of this Agreement. Upon reasonable approval by the City Attorney as to form, the City authorizes the City Manager to execute any Notices of Consent to Assignmen t on behalf of the City or similar financial documentation.

2.4 Term of Agreement. Unless this Agreement is earlier terminated as provided for herein, this Agreement shall continue in full force and effect for thirty (30) years after the date the Digital Display becomes Operational or the removal of the Digital Display, whichever is earlier (“Term”). The Parties may extend the Term or amend the terms of this Agreement by written amendment, subject to approval of the City Council. If the parties are unab le to agree to extend the Term; then, within thirty (30) days after the expiration or termination of this Agreement, the parties shall execute a written cancellation of this Agreement, which shall be recorded with the County Recorder at the City's expense pursuant to Section 8.1 below

2.5 Public Benefits.

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6 2.5.1 Development Fees.
(a) Minimum Annual Guarantee (“MAG”). In addition to the one-time development fee required under Section 2.5.1(a), Developer shall pay City an annual MAG fee of $75,000.00 (the “MAG Fee”) during the Term of this Agreement payable in equal monthly installments paid to the City on or before the fifteenth (15th) day of the first month following Digital Display becoming Operational and each month thereafter. The MAG shall be increased annually on the anniversary of the Digital Display becoming Operational by 2% with an MAG Fee of $100,000 in year 10 plus annual increase and $120,000 in year 20 through year 30. (b) Percentage Fee. To the extent that ten percent (10%) (the “Annual Revenue Share Percentage”) of the Annual Net Revenue exceeds the MAG (or the prorated MAG for the 1st and last year of the Term) as of March 31st of every year starting the year after the MAG Commencement Date, Developer shall make an additional payment to the City by March 31st of each year of the Term in the amount by which (i) the Annual Revenue Share Percentage multiplied by (ii) the Annual Net Revenue collected by Developer for the immediate preceding Term year exceeds the MAG amount paid by Tenant to the City pursuant to Section 2.5.1(b) for such Term year. In no event shall the amount of the Development Fees due under Section 2.5.1 of this Agreement be less than the MAG.
(1) Reports. Developer shall furnish to City an annual statement of Annual Net Revenue for the Digital Display by March 31 st of each year of the Term. Such statement shall be in a form listed in Exhibit D. Each statement shall be signed and certified to be correct by a duly authorized officer of Developer or by the head of their accounting department.

Developer shall keep and make available complete and materially accurate books of account, records, cash receipts and other pertinent data, in accordance with good accounting practices , showing the Annual Net Revenue, including without limitation, mate rially accurate records of every sale and other sales transaction made for any advertising display on the Digital Display and any commissions paid by Developer to an agency or broker. Such books of account, records, cash receipts, or other pertinent data shall be kept for a period of no less than four (4) years after the end of each year. The receipt by City of any statement, or any payment of the Percentage Fee for any period, will not bind City as to the correctness of the statement or payment. (2) Inspection and Audit. City, at its sole option, shall be entitled, at any time and from time to time during the Term and during normal business hours and with prior written notice to Developer, to inspect, examine, copy and audit Developer's books, records and cash receipts as related to Annual Net Revenue. Developer shall cooperate fully with City and City's agents in making the examination. City, at its option, will also be entitled once during each year of the Term and once after the Expiration Date or other termination of this Agreement, to cause an independent audit of such records to be performed by a certified public accountant designated by City, provided such accountant is not paid on a contingency fee basis.

The audit will be conducted during usual business hours at Developer’s office located at 3127 E.

South Street, Suite B, Long Beach, CA 90805 , unless another location is mutually agreed upon.

If the audit shows that there is a deficiency in the payment of any Percentage Fee, then Developer shall promptly upon notice pay the deficiency to City which payment will not require any penalty or other late fee. City will pay the costs of the audit unless the audit shows that Developer City Council Regular Meeting - Page 337 of 421
7 understated Annual Net Revenue by more than three (3%) percent in which case Developer shall pay all reasonable out -of-pocket costs paid to third party consultants and incurred by City in connection with the audit.
(c) Late Charge; Default Interest.
(1) Late Charge. If Developer fails to pay any payments or fees required under this Agreement after the same is due and payable, such unpaid amount shall be subject to a late payment charge equal to five percent (5%) of the unpaid amount in each instance.

The late payment charge has been agreed upon by City and Deve loper, after negotiation, as a reasonable estimate of the additional administrative costs and detriment that City will incur as a result of any such failure by Developer, the actual costs thereof being extremely difficult —if not impossible—to determine. The late payment charge constitutes liquidated damages to compensate City for its damages resulting from such failure to pay, and Developer shall promptly pay such charge to City together with any unpaid interest.
(2) Default Interest. If any payments or fees are not paid following the due date, such unpaid amount will bear simple interest at the rate of 10% per year or the maximum permitted by law, whichever is lower (“Default Rate”) from the due date until paid.

However, interest will not be payable on late charges incurred by Developer, nor on any amounts on which late charges are paid by Developer to the extent this interest would cause the total interest to be in excess of that which an individual is lawfully permitted to charge. Payment of interest will not excuse or cure any default by Developer.
(3) Application of Payments . All payments received by City from Developer will be applied to the corresponding obligation owed by Developer to City. No designation by Developer, either in a separate writ ing, on a check or money order, or otherwise will modify this Agreement or have any force or effect.

2.5.2 Processing Fee. Developer has paid to City a one -time, nonrefundable processing fee ("Processing Fee") in the amount of Twenty Thousand Dollars ($20,000.00), which shall be used to pay City for the following: (1) City staff’s costs for the review and processing of this Development Agreement separate from the processing of such other building and planning entitlements or CEQA review in connection with the Digital Display and (2) City’s costs associated with costs of the City’s legal counsel or any other of City consultants associated with the preparation, processing, and review of this Agreement . The Processing Fee shall be separate from all fees which are standard and uniformly applied to similar projects in the City, including, but not limited to, business license fees (due by Developer to City annually), one-time plan check fee and building permit fee and any other fees imposed by the City as may be applicable.

2.6 City Usage of Digital Display. To the extent that commercial advertising time on the Billboard is unsold and available, City shall have the right to use up to five percent (5%) of the total advertising time to promote civic and public purposes that serve the needs of the City and its residents, including but not limited to, City events and programs (such usage “City Usage”). City Usage shall be displayed (subject to the terms of this Agreement) during the operation of the Digital Display in increments, equally spread throughout each 24 -hour day on a space available City Council Regular Meeting - Page 338 of 421
8 basis as long as the City obtains 5% on an annual basis if they request it (any time not requested is lost at the end of each year and does not accumulate to the next year), and otherwise in the same manner as other commercial advertising displayed on the Digital Display. The City shall submit all proposed copy to Developer not less than five (5) business days prior to the date the copy is proposed to be displayed. All proposed City Advertising copy shall be prepared and submitted at the City’s sole cost, shall be in a format ready for posting on the Digital Display per Developer’s posting specification sheet, and shall be subject to Developer’s standard advertising copy rejection and removal policies, which allow Developer to approve or disapprove copy and remove copy once posted or displayed. City represents and warrants that all copy, content and materials supplied by City to Developer for display under this Agreement: (i) are owned or duly licensed by City and do not infringe or misappropriate the rights of any other person or entity; (ii) comply with all applicable federal, state, and local laws, rules and regulations and any industry codes or rules by which City and/or Developer may be bound and do not contain any obscene, libelous, slanderous or otherwise defamatory materials or refer in an offensive manner to the gender, race or ethnicity of any individual or group; (iii) are accurate and that all claims contained therein hav e been substantiated; and (iv) do not infringe upon any copyright, trademark or other intellectual property or privacy right of any third party. Any content provided by City shall be owned and belong exclusively to the City, and Developer shall not reprodu ce, sell, or give away any such content without the advance written consent of the City.

2.6.1 Emergency Notifications. Without any offset in the City Usage described above and at no cost to the City and as further consideration for the use and occupancy of Premises, Tenant shall make the Digital Display available to Caltrans and the California Highway Patrol on a space available basis for purposes of “Amber Alerts” and for emergency or disaster notifications by local, state, or federal agencies.

2.6.2 Jurisdictional Sign. In addition, Developer agrees to construct and install on the Billboard an illuminated jurisdictional sign naming the City of Lynwood at no cost to City with the final design agreed to between the City and Developer.

2.6.3 City Facility Authorized. Upon mutual agreement of Developer and the City’s Manager, the City or Developer may install telecommunication equipment (the “Equipment”) on the pole at a cost to be paid by the telecommunication company and if all Parties and the telecommunication enter into a indemnification, defense and hold harmless agreement regarding the Equipment acceptable to Developer and the City and the Developer approve of the modifications requested by the telecommunication company and enter into a lease with the telecommunication company. This clause is subject to the unilateral approval of Developer’s landlord which can refuse for any reason, reasonable or not.

2.6.4 Fixed Facility Fee: Should City and Developer enter into a lease with a telecommunication company and Developer’s landlord for the installation of an antenna or wireless communication device for cellular, wi -fi or other service on the Billboard pole or structure (the “Device”), the City and Developer shall share equally the gross revenue collected as a result of the Device as additional revenue after the Developer’s landlord portion of the gross revenue is deducted . The party receiving the additional revenue from the telecommunication City Council Regular Meeting - Page 339 of 421
9 company shall have the right to review and audit the revenue received within 30 days upon request by the other party.

2.7 Prohibited Use. Developer shall not utilize any of the Digital Displays to advertise or display messages that are:

2.7.2 promotes the sale of firearms, tobacco products, whether directly or indirectly;

2.7.3 promotes sexually oriented materials, adult businesses, entertainment, products, conventions, events, or websites; and

2.7.4 promotes any product, service or activity illegal under federal, state, or local law.

3. DEVELOPMENT AND IMPLEMENTATION OF THE PROJECT.

3.1 Rights to Develop Billboard on the Site. Subject to and during the Term of this Agreement, Developer shall have the right to develop the Project on the Site in accordance with, and to the extent of, the Final Permits, the Land Use Regulations, and this Agreement, provided that nothing in this Agreement shall be deemed to modify or amend the Lease.

3.2 Effect of Agreement on Land use Regulations. The rules, regulations and official policies governing permitted uses of the Site, the density and intensity of such uses, the maximum height and size of proposed structures, and the design, improvement and construction standards and specifications applicable to the development of the Project shall be as set forth in the Land Use Regulations, as such term is defined in Section 1.1. 10, which are in full for ce and effect on the Effective Date.

3.3 Development Approvals. Developer shall, at its own expense and before commencement of demolition, construction or development of any structures or other work of improvement upon the Site, secure or cause to be secured all necessary Development Approvals, which shall include any and all permits and approvals which may be required by City or any other governmental agency or utility affected by such construction, development or work to be performed by Developer, including but not limited to, necessary building permits and all approvals required under the California Environmental Quality Act ("CEQA") if any, although the Project will be processed as categorically exempt from CEQA pursuant to Section 15332 regarding Urban In-Fill Development Projects. Not by way of limiting the foregoing, in developing and constructing the Project, Developer shall comply with all (1) development standards in City's Municipal Code applicable on the Effective Date, (2) NPDES requirements pertaining to the Project applicable on the Effective Date, (3) all applicable building codes applicable on the Effective Date, except as the Project may be permitted through approved variances and modifications, and (4) all Caltrans rules and regulations necessary to obtain an Outdoor Advertising Permit including a Relocation Agreement, if required. Developer shall pay all normal and customary fees and charges applicable to such permits, and any fees and charges hereafter imposed by City in connection with the Project which are standard and uniformly applied to similar projects in the City.

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10 3.3.1 Relocation. The City shall cooperate and assist the off -site advertising sign Developer with complying with federal, state and local laws for any off -site advertising sign that was approved by a development agreement; including but not limited to assistance with a relocation per Bus. & Professions Code, Section 5412 for any of the off -site advertising sign locations that are in landscaped classified areas per state law. The Parties acknowledge that the Property located at 11350 Wright Road, in the City of Lynwood, in the County of Los Angeles (Assessor’s Parcel Number 6194 -031-007) is on a landscaped section of the Long Beach (710) Freeway and that Developer will need to pursue a relocation per Bus. & Professions Code, Section 5412. Therefore City desires to support and cooperate in the necessary relocation processes for permitting the construction and operation of billboards on the Property since the relocation allows the City to continued development in a planned manner for the general welfare and benefit of the public.

3.4 Timing of Project. Developer shall commence the Project within one-hundred forty (140) days after obtaining the Final Permits. “Commencement" of the Project is herein defined as the start of construction of the Billboard on the Site under the applicable Final Permits.

In the event Developer fails to commence such construction within one-hundred forty (140) days after obtaining the Final Permits, and after compliance with Section 5.3, either party hereto may terminate this Agreement by delivering written notice to the other party, and, in the event of such termination, neither party shall have any further obligation hereunder. However, if circumstances within the scope of Section 8.10 delay the commencement or completion of the Project, it would not constitute grounds for any termination rights found within this Agreement. In such case, the timeline to commence or complete the relevant task shall be extended in the manner set forth at Section 8.10. Notwithstand ing the above, Developer shall, at all times, comply with all other obligations set forth in this Agreement regarding construction of the Project on the Site. Developer shall also maintain and operate the Billboard at all times during the Term of this Agre ement in compliance with the provisions set forth below:

3.4.1 Maintenance. Developer, for itself and its successors and assigns, hereby covenants and agrees to be responsible for the maintenance and repair of the Billboard, including but not limited to, t he Digital Displays installed thereon, and all related on -Site improvements, easements, rights -of-way and, if applicable, at its sole cost and expense, including, without limitation, poles and lighting, in good repair, free of graffiti, rubbish, debris and other hazards to persons using the same, and in accordance with all applicable laws, rules, ordinances and regulations of all federal, State, and local bodies and agencies having jurisdiction over the Site.

Such maintenance and repair shall include, but n ot be limited to, the following: (i) sweeping and trash removal related to the Billboard; (ii) ongoing maintenance by the Developer of any access area to the Billboard to minimize dust caused by the Project; (iii) the adequate and complete removal or painting over of all graffiti within 48 hours of notice of such graffiti being affixed on the Billboard; and (iv) the repair, replacement and repainting of the structure and the Digital Displays as necessary to maintain such Billboard in good condition and repair.

3.4.2 Developer shall comply with the standards as adopted by the Outdoor Advertising Association of America, Inc. (OAAA), including but not limited to, the 0.3 foot - candles limitation over ambient light levels at 250 feet, and ensuring additional f lexibility in reducing such maximum light level standard given the lighting environment, the obligation to have City Council Regular Meeting - Page 341 of 421
11 automatic diming capabilities, as well as providing the City’s Planning Manager or designee with a designated Developer employee’s phone number and/or email address for emergencies or complaints that will be monitored 24 hours a day/7 days per week.

3.4.3 In the event ten percent (10%) or more of the digital sign face is not operating correctly or in the event of a malfunction, Developer shall immediately turn the entire display off, or show a one hundred percent (100%) black image on the display until corrected.

3.5 Changes and Amendments. Developer may determine that changes to the Development Approvals are appropriate and desirable. In the event Developer makes such a determination, Developer may apply in writing for an amendment to the Development Approvals to effectuate such change(s). The Parties acknowledge that City shall be permitted to use its inherent land use authority in deciding whether to approve or deny any such amendment request; provided, however, that in exercising the foregoing the City shall use reasonable discretion and shall not apply a standard different than that used in evaluating requests of other developers. Accordingly, under no circumstance shall City be obligated in any manner to approve any amendment to the Development Approvals. The City Manager shall be authorized to approve, without processing an amendment to this Agreement, any non-substantive amendment to the Development Approvals that does not: (i) adversely impact and/or diminish Developer’s or City’s rights as provided hereunder and (ii) affect and/or block the visibility of the Digital Display or accessibility to the Billboard or (iii) decreases the public benefits set forth herein. All other amendments shall require approval of the City Council.

Nothing herein shall cause Developer to be in default under this Agreement if it upgrades the Digital Display or the Billboard to incorporate newer technology or design; provided Developer shall secure all applicable ministerial permits to do so and such upgrade is consistent with the dimensions provided in this Agreement.

3.6 Reservation of Authority

3.6.1 Limitations, Reservations and Exceptions. Notwithstanding any other provision of this Agreement, the following Subsequent Land Use Regulations shall apply to the development of the Project:
(a) Processing fees and charges of every kind and nature imposed by City to cover the estimated actual costs to City of processi ng applications for amendments to the Development Approvals.
(b) Procedural regulations consistent with this Agreement relating to hearing bodies, petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals and any other ma tter of procedure. Notwithstandi ng the foregoing, if such change materially changes Developer's costs or otherwise materially impacts its performance hereunder, Developer may terminate this Agreement upon ninety (90) days prior written notice. (c) Changes adopted by the International Conference of Building Officials, or other similar body, as part of the then most current versions of the Uniform Building Code, Uniform Fire Code, Uniform Plumbing Code, Uniform Mechanical Code, or National Electrical Code, as adopted by City as Subsequent Land Use Regulations, if adopted prior to the issuance City Council Regular Meeting - Page 342 of 421
12 of a building permit related to an amendment to the Development Approval. Notwithstanding the foregoing, if such change materially changes Developer's costs or otherwise materially impacts its performance hereunder, developer may terminate this Agreement upon ninety (90) days prior written notice.
(d) Regulations that are not in conflict with the Development Approvals or this Agreement.
(e) Regulations that are in conflict with the Development Approvals or this Agreement, provided Developer has given written consent to the application of such regulations to the development of the Project.
(f) Applicable Federal, State, County, and multi -jurisdictional laws and regulations which the City is required to enforce against the Site or the development of the Project and that do not have an exception for existing signs or legal nonconforming uses.

3.6.2 Future Discretion of City. This Agreement shall not prevent City from denying or conditionally approving any application for a subsequent development approval on the basis of Subsequent Land Use Regulations.

3.6.3 Modification or Suspension by Federal, State, County, or Multi - Jurisdictional Law. In the event that applicable federal, State, County, or multi-jurisdictional laws or regulations, enacted after the Effective Date of this Agreement, prevent or preclude compliance with one or more of the provisions of this Agreement, and there is no exception for the legal nonconforming use, such provisions of this Agreement shall be modified or suspended as may be necessary to comply with such federal, State, County, or multi -jurisdictional laws or regulations, and this Agreement shall remain in full force and effect to the extent it is not inconsiste nt with such laws or regulations and to the extent such laws or regulations do not render such remaining provisions impractical to enforce.

3.7 Regulations by Other Public Agencies. It is acknowledged by the parties that other public agencies not subject to control by City may possess authority to regulate aspects of the development of the Project as contemplated herein, and this Agreement does not limit the authority of such other public agencies. Developer acknowledges and represents that, in addition to the Land Use Regulations, Developer shall, at all times, comply with all applicable federal, State and local laws and regulations applicable to the Billboard and Site that do not have an exception for a legal nonconforming use. To the extent such other public agencies preclude development or maintenance of the Project and do not have an exception for a legal nonconforming use, Developer shall not be further obligated under this Agreem ent except as provided in Section 4.1. Notwithstanding the foregoing, if such action by another public agency materially changes Developer's costs or otherwise materially impacts its performance hereunder, Developer may terminate this Agreement upon ninety (90) days prior written notice.

3.8 Public Improvements. Notwithstanding any provision herein to the contrary, City shall retain the right to condition any subsequent development approvals to require Developer to City Council Regular Meeting - Page 343 of 421
13 pay any required development fees, and/ or to construct the required public infrastructure at such time as City shall determine.

3.9 Fees, Taxes Assessments. This Agreement shall not prohibit the application of customary fees, taxes, or assessments upon the Site.

4. REMOVAL OF BILLBOARDS

4.1 Removal of Digital Display by Developer. If the Parties do not extend the Term of this Agreement pursuant to Section 2.4 above, or if Developer breaches this Agreement after notice and a right to cure as provided in Section 5.3, or if the Developer’s lease with the property owner otherwise terminates before the expiration of this Agreement or following the natural expiration of the Term or extensions thereof, Developer shall remove the Digital Display before lease termination and cancel this Agreement as p rovided in Section 2.4. If Developer does not timely remove the Digital Display and other improvements as required by this Section, City may, but shall not be required to, remove or cause the removal of the Digital Display and related structures on the Pr emises at Developer's expense and return the structures to the Developer or scrap them if Developer does not accept them . If Developer does not timely remove the Digital Display and other improvements as required by this Section and the City does not remove the sign, the City cannot operate the sign or allow anyone else to operate the sign. Developer shall reimburse City within thirty (30) days of receipt of an itemized accounting of the cost for such removal.

If the Lease terminates before the expiration of this Agreement, Developer will remove the Billboard concurrently with the Lease termination and cancel this Agreement as provided in Section 2.4. If Developer does not timely remove the Billboard and other imp rovements as required by this Section, City may, but shall not be required to, remove or cause the removal of the Billboard at Developer's expense and return the structures to the Developer or scrap them if Developer does not accept them . If Developer does not timely remove the Digital Display and other improvements as required by this Section and the City does not remove the sign, the City cannot operate the sign or allow anyone else to operate the sign. Developer shall reimburse City within thirty (30) days of receipt of an itemized accounting of the cost for such removal.

4.2 City’s Right to Removal. Provided Developer is not in material breach hereof and subject to the notice and cure provisions in Section 5.3 herein, City will not have the right to: (i ) remove the Digital Display, (ii) limit access to the Digital Display, or (iii) limit the visibility of the Digital Display, in any way, which is under their control. Should Developer breach this Agreement, City may only require removal of the Digital Display subject to Developer’s rights in Section 4.1.

5. REVIEW FOR COMPLIANCE.

5.1 Annual Review. The City may review this Agreement annually, at City's sole cost, to ascertain Developer’s good faith compliance with the terms of the Agreement ("Annual Review").

However, no failure on the part of City to conduct or complete an Annual Review as provided herein shall have any impact on the validity of this Agreement. Developer shall cooperate with City in the conduct of any Annual Review and timely provide the following information and documentation to City Council Regular Meeting - Page 344 of 421
14 City: (1) description of all complaints received regarding the Billboard that were unrelated to the content of any message displayed, (2) any updates to Developer's contact information, (3) status and amount of all payment obligations to the City required under this Agreement, (4) any easement or Lease changes that could in any way materially impact the City or Developer’s obligations under this Agreement, (5) any utility changes that could in any way materially impa ct the City or the obligations under this Agreement, and (6) any maintenance issues addressed or needing to be addressed that were raised by the City per the maintenance requirements herein.

5.2 City Rights of Access. Subject to City's execution of a permit to enter the Property, City’s officers, employees, agents and contractors, shall have the right, at their sole risk and expense, to enter the Site at all reasonable times and with as little interference as possible to the operation of the Billboard ther eon, for the purpose of assuring compliance with this Agreement, conducting the annual review under this Section 5, as well as inspecting the construction, reconstruction, relocation, maintenance, repair and service of any public improvements or public facilities located on the Site, or to perform any rights of the City under Section 4.2 above. Any damage or injury to the Site or to the Billboard thereon resulting from such entry shall be promptly reported to the Developer to assess the proper repair proced ure that the City shall solely pay for , unless an emergency, where under the City can do a repair at the City’s sole expense and then report the damage and repair to the Developer . Notwithstanding the foregoing, or any other provision in this Agreement (in cluding without limitation Section 4.2 above), City shall have no right to enter the Site unless and until City executes and delivers to Developer a permit to enter (except that this provision is not intended to interfere with the City's police powers to address any nuisance, dangerous condition, or other condition pursuant to the City's ordinances).

Notwithstanding anything to the contrary herein, in no event will City representatives ever climb up the pole of the Billboard during any inspection.

5.3 Procedure. Each party shall have a reasonable opportunity to assert matters, which it believes, have not been undertaken in accordance with the Agreement, to explain the basis for such assertion, and to receive from the other party a justification of its position on such matters. If either party concludes that the other party has not complied in good faith with the terms of the Agreement, then such party may issue a written "Notice of Non-Compliance" (“Notice”) specifying the grounds therefore and all facts demonstrating such non-compliance. The party receiving a Notice shall have thirty (30) days to cure or remedy the non -compliance identified in the Notice, or if such cure or remedy is not reasonably capable of being carried out to completion within such thirty (30) day period, to commence to cure or remedy the noncompliance and to diligently and in good faith prosecute such cure or remedy to completion. If the party receiving the Notice does not believe it is out of compliance, it may contest the Notice by responding in writing to said Notice within thirty (30) days after receipt of the Notice. If a response to the Notice has not been received in the offices of the party alleging the non -compliance within the prescribed time period, the Notice shall be conclusively presumed to be valid. If a Notice is contested, the parties shall, for a period of not less than fifteen (15) days after receipt of the response, seek to arrive at a mutually acceptable resolution of the matter(s) occasioning the Notice. In the event a cure or remedy is not timely effected or, if the Notice is contested and the parties are not able to arrive at a mutually acceptable resolution of the matter(s) by the end of the fifteen (15) day period, the party alleging the non -compliance may thereupon pursue the remedies provided in Section 6. Neither party hereto shall be deemed in breach City Council Regular Meeting - Page 345 of 421
15 of this Agreement if the reason for non-compliance is due to a "force majeure" as defined in, and subject to the provisions of Section 8.10.

5.4 Certificate of Agreements Compliance. If, at the conclusion of an Annual Review or a Special Review, Developer is found to be in compliance with this Agreement, City shall, issue a Certificate of Agreement Compliance ("Certificate") to Developer stating that, after the most recent Annual Review or Special Review, and based upon the information known or made known to the City Manager and City Council: (1) this Agreement remains in effect and (2) Developer is in compliance. The Certificate, whether issued after an Annual Review or Special Review, shall be in recordable form and shall contain information necessary to communicate constructive record notice of the finding of compliance. Developer may record the Certificate with the County Recorder. Additionally, Developer may, at any time, request from the City a Certificate stating, in addition to the foregoing, which obligations under this Agreement have been fully satisfied with respect to the Site.

6. DEFAULT AND REMEDIES

6.1 Termination of Agreement.

6.1.1 Termination of Ag reement for Material Default of Developer. City, in its discretion, may terminate this Agreement for any material failure of Developer to perform any material duty or obligation of Developer hereunder or to comply in good faith with the terms of this Agreement (hereinafter referred to as "default" or "breach") after complying with the notice and cure period set forth in Subsection 5.3. In the event of a termination by City under this Section

6.1.1, Developer acknowledges and agrees that City will retain all Fees paid to City and accrued up to the date of the termination. However, this Section 6.1.1 shall have no effect on Developer’s rights as set forth in section 4.1.

6.1.2 Material Default of City. Developer, in its discretion, may terminate or seek any other remedy it deems appropriate for any material failure of City to perform any material duty or obligation of City hereunder or to comply in good faith with the term of this Agreement; provided, however, Developer may seek such remedy pursuant to this Section only after following the procedure set forth in Section 5.3.

6.1.3 Rights and Duties Following Termination. After termination of this Agreement, no party shall have any further right or obligation hereunder except with respect to (i) any obligations to have been performed prior to said termination, (ii) any default in the performance of the provisions of this Agreement that occurred prior to said termination, (iii) Developer's obligation to remove the Digital Display pursuant to Section 4.1 or (iv) any continuing obligations to indemnify the other party.

7. INSURANCE, INDEMNIFICATION AND WAIVERS.

7.1 Insurance.

7.1.1 Types of Insurance.

City Council Regular Meeting - Page 346 of 421
16 (a) Liability Insurance. Beginning on the Effective Date hereof and until completion of the Term, Developer shall, at its sole cost and expense, keep or cause to be kept in force for the mutual benefit of City, as additional insured, and Developer, comprehensive broad form general liability insurance against claims and liabilities covered by the indemnification provisions of section 7.2. Developer has agreed to indemnify City hereunder to the extent of the liability insurance coverage with respect to its use, occupancy, disuse or condition of the Site, improvements or adjoining areas or ways, affected by such use of the Site or for property damage, providing protection of a least Two Million Dollars ($2,000,000) for bodily injury or death to any one person, at least Four Million Dollars ($4,000,000) for any one accident or occurrence, and at least One Million Dollars ($1,000,000) for property damage. Developer shall also furnish or cause to be furnished to City evidence that any contractors with whom Developer has contracted for the performance of any work for which Developer is responsible maintains the same coverage required of Developer.
(b) Worker’s Compensation. Developer shall also furnish (or cause to be furnished) to City evidence that Developer and any contractor with whom Developer has contracted for the performance of any work for which Developer is responsible hereund er maintains and carries worker's compensation insurance as required by law. (c) Insurance Policy Form, Sufficiency, Content and Insurer. All insurance required by express provisions hereof shall be carried only by responsible insurance companies qualified to do business by California with an AM Best Rating of no less than "A-". All such policies shall be non-assignable and shall contain language, to the extent obtainable, to the effect that (i) the insurer waives the right of subrogation against City and again st City's agents and representatives except as provided in this section; (ii). Developer shall furnish City with certificates evidencing the insurance and City shall be named as an additional insured on all liability policies of insurance required to be procured by the terms of this Agreement.

7.2.1 Failure to Maintain Insurance and Proof of Compliance. Developer shall deliver to City, in the same manner required for notices, copies of certificates of all insurance policies required of each policy within the following time limits:
(a) For insurance required above, within seven (7) days after issuance of the Final Permits; and
(b) The City can request to see updated copies of the current certificates of all insurance policies required. The City reserves t he right to obtain copies of the entire insurance policy, including endorsements.

If Developer fails or refuses to procure or maintain insurance as required hereby or fails or refuses to furnish City with required proof that the insurance has been procured and is in force and paid for, after complying with the requirements of Section 5.4, the City may view such failure or refusal as a default hereunder.

7.2 Indemnification
City Council Regular Meeting - Page 347 of 421
17 7.2.1 General. Developer shall indemnify City, and its respective officers, employees, and agents against, and will hold and save them and each of them harmless from, any and all actions, suits, claims, damages to persons or property, losses, costs, penalties, obligations, errors, omissions, or liabilities (herein "claims or liabilities") that may be asserted or claimed by any person, firm, or entity arising out of or in connection with the work, operations, or activities of Developer, its agents, employees, subcontractors, or invitees, hereunder, upon the Site . The City will promptly notify the permittee of any such claim, action, or proceeding against City and will cooperate fully in the defense. To this end:
(a) Developer will defend any action or actions filed in connection with any of said claims or liabilities covered by the indemnifi cation provisions herein and will pay all costs and expenses, including legal costs and attorneys' fees incurred in connection therewith, which attorneys will be the attorneys hired by the insurance company where insurance coverage applies. (b) Developer will promptly pay any judgment rendered against the City or its respective officers, agents, or employees for any such claims or liabilities arising out of or in connection with such work, operations, or activities of the Developer hereunder, and Developer agrees to save and hold the City and its respective officers, agents, and employees harmless therefrom.

7.2.2 Exceptions. The foregoing indemnity shall not include claims or liabilities arising from the sole negligence or willful misconduct of City, its officers, agents, or employees.

7.2.3 Additional Coverage. Without limiting the generality of the foregoing, Developer’s indemnity obligation shall include any liability arising by reason of:
(a) Any accident or other occurrence in or on the Site causing injury to any person or property whatsoever caused by Developer.
(b) Any failure of Developer to comply with performance of all of the provisions of this Agreement.
(c) Any harm, delays, injuries or other damages incurred by any party as a result of any subsurfac e conditions on the Site caused solely by Developer, including but not limited to, the presence of buried debris, hazardous materials, hydrocarbons, or any form of soil contamination.

7.2.4 Loss and Damage. Except as set forth below, City shall not be liable for any damage to property of Developer or others located on the Site, nor for the loss of or damage to any property of Developer or others by theft or otherwise. Except as set forth below, City shall not be liable for any injury or damage to person s or property resulting from fire, explosion, steam, gas, electricity, water, rain, dampness or leaks from any part of the Site or from the pipes or plumbing, or from the street, or from any environmental or soil contamination or hazard, or from any other latent or patent defect in the soil, subsurface or physical condition of the Site, or by any other cause of whatsoever nature. The foregoing two (2) sentences shall not apply: (i) to the extent City or its agents, employees, subcontractors, invitees or rep resentatives cause such injury or damage when City Council Regular Meeting - Page 348 of 421
18 accessing the Site, (ii) to the extent covered in any permit to enter executed by the City, or (iii) to negligent or willful acts or omissions of the City, its employees, officials, representatives or agents.

7.2.5 Period of Indemnification. The obligations for indemnity under this Section

7.2 shall begin upon the Effective Date and shall survive termination of this Agreement, provided the actions or omissions subject to indemnification above shall have occurred prior to termination.

7.3 Waiver of Subrogation. Developer and City each agrees that it shall not make any claim against, or seek to recover from the other or its agents, servants, or employees, for any loss or damage to it or to any person or property relating to this Project, except as specifically provided hereunder which includes but is not limited to, a claim or liability arising from the sole negligence or willful misconduct of the City, its officers, agents, or employees.

8. MISCELLANEOUS PROVISIONS.

8.1 Recordation of Agreement. This Agreement shall be recorded with the County Recorder by the City Clerk within 10 days of execution, as required by Government Code Section 65868.5. Amendments approved by the parties, and any cancellation, shall be similarly recorded.

8.2 Entire Agreement. This Agreement sets forth and contains the entire understanding and agreement of the parties with respect to the subject matter set forth herein, and there are no oral or written representations, understandings or ancillary covenants, undertakings or agreements which are not contained or expressly referred to herein. No testimony or evidence of any such representations, understandings or covenants shall be admissible in any proceeding of any kind or nature to interpret or determine the terms or conditions of this Agreement.

8.3 Severability. If any term, provision, covenant or condition of this Agreement shall be determined invalid, void or unenforceable, then that term, provision, covenant or condition shall be stricken and the remaining portion of this Agreement shall remain valid and enforceable if that stricken term, provision, covenant or condition is not material to the main purpose of this Agreement, which is to allow the Project to be permitted and operated and to provide a public benefit to the City; otherwise, this Agreement shall terminate in its entirety, unless the parties otherwise agree in writing, which agreement shall not be unreasonably withheld.

8.4 Interpretation and Governing Law. This Agreement and any dispute arising hereunder shall be governed and interpreted in accordance with the laws of the State of California.

This Agreement shall be construed as a whole according to its fair language and common meaning, to achieve the objectives and purposes of the parties hereto. The rule of construction, to the effect that ambiguities are to be resolved against the drafting party or in favor of the non -drafting party, shall not be employed in interpreting this Agreement, all parties having been represented by counsel in the negotiation and preparation hereof.

8.5 Section Headings. All section headings and subheadings are inserted for convenience only and shall not affect any construction or interpretation of this Agreement.

8.6 Singular and Plural. As used herein, the singular of any word includes the plural.

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19 8.7 Time of Essence. Time is of the essence in the performance of the provisions of this Agreement as to which time is an element.

8.8 Waiver. Failure of a party to insist upon the strict performance of any of the provisions of this Agreement by the other party, or the failure by a party to exercise its rights upon the default of the other party, shall not constitute a waiver of such party's right to insist and demand strict compliance by the other party with the terms of this Agreement thereafter.

8.9 No Third-Party Beneficiaries. This Agreement is made and entered into for the sole protection and benefit for the Parties, as well as their successors and assigns. No other person shall have any right of action based upon any provision of this Agreement.

8.10 Force Majeure. Notwithstanding anything to the contrary herein, neither party shall be deemed to be in default where failure or delay in performance of any of its obligations under this Agreement is ca used by earthquakes, other acts of God, fires, rains, winds, wars, terrorism, riots or similar hostilities, strikes and other labor difficulties beyond the party's control (including the party's employment force), government actions and regulations (other than those of the City), court actions (such as restraining orders or injunctions), or other causes beyond the party's reasonable control. If any such events shall occur, the term of this Agreement and the time for performance shall be extended for the dur ation of each such event, provided that the term of this Agreement shall not be extended under any circumstances for more than five (5) years and further provided that if such delay is longer than six (6) months, Developer may terminate this Agreement upon written notice to City.

8.11 Mutual Covenants. The covenants contained herein are mutual covenants and also constitute conditions to the concurrent or subsequent performance of the covenants to be performed hereunder by the benefited party.

8.12 Counterparts. This Agreement may be executed by the parties in duplicate counterparts, which counterparts shall be construed together and shall have the same effect as if all of the parties had executed one and the same instrument.

8.13 Litigation. Any action at law or in equity arising under this Agreement or brought by any party hereto for the purpose of enforcing, construing or determining the validity of any provision of this Agreement shall be filed and tried in the Superior Court of the County of Los Angeles, State of California, or such other appropriate court in said county. Service of process on City shall be made in accordance with California law. Service of process on Developer shall be made in any manner permitted by California law and shall be effecti ve whether served inside or outside California. In the event of any action between City and Developer seeking enforcement of any of the terms and conditions to this Agreement, the prevailing party in such action shall be awarded, in addition to such relief to which such party is entitled under this Agreement, its reasonable litigation costs and expenses, including without limitation its expert witness fees and reasonable attorneys' fees.

8.14 Covenant Not To Sue. The parties to this Agreement, and each of them, agree that this Agreement and each term hereof is legal, valid, binding, and enforceable. The parties to this City Council Regular Meeting - Page 350 of 421
20 Agreement, and each of them, hereby covenant and agree that each of them will not commence, maintain, or prosecute any claim, demand, caus e of action, suit, or other proceeding against any other party to this Agreement, in law or in equity, which is based on an allegation, or assert in any such action, that this Agreement or any term hereof is void, invalid, or unenforceable.

8.15 Project as a Private Undertaking. It is specifically understood and agreed by and between the parties hereto that the development of the Project is a private activity, that neither party is acting as the agent of the other in any respect hereunder, and that each pa rty is an independent contracting entity with respect to the terms, covenants and conditions contained in this Agreement. No partnership, joint venture or other association of any kind is formed by this Agreement. The only relationship between City and Dev eloper is that of a government entity regulating the development of private property, on the one hand, and the holder of a legal or equitable interest in such property on the other hand. City agrees that by its approval of, and entering into, this Agreement, that it is not taking any action which would transform this private Project into a "public work" project, and that nothing herein shall be interpreted to convey upon Developer any benefit which would transform Developer's private project into a public work project, it being understood that this Agreement is entered into by City and Developer upon the exchange of consideration described in this Agreement, including the Recitals to this Agreement which are incorporated into this Agreement and made a part hereof, and that City is receiving by and through this Agreement the full measure of benefit in exchange for the burdens placed on Developer by this Agreement.

8.16 Further Actions and Instruments. Each of the parties shall cooperate with and provide reasonable assistance to the other to the extent contemplated hereunder in the performance of all obligations under this Agreement and the satisfaction of the conditions of this Agreement.

Upon the request of either party at any time, the other party shall promptly execute, with acknowledgment or affidavit if reasonably required, and file or record such required instruments and writings and take any actions as may be reasonably necessary under the terms of this Agreement to carry out the intent and to fulfill the provisions of this Agreement or to evidence or consummate the transactions contemplated by this Agreement.

8.17 Eminent Domain. No provision of this Agreement shall be construed to limit or restrict the exercise by City of its power of eminent domain or Developer's right to seek and collect just compensation or any other remedy available to it.

8.18 Amendments in Writing/Cooperation. This Agreement may be amended only by written consent of both parties specifically approving the amendment and i n accordance with the Government Code provisions for the amendment of development agreements. The parties shall cooperate in good faith with respect to any amendment proposed in order to clarify the intent and application of this Agreement and shall treat any such proposal on its own merits, and not as a basis for the introduction of unrelated matters. Non -substantive amendments to the Development Approvals may be approved without amending this Agreement as provided in Section 3.5.

8.19 Corporate Authority. The person(s) executing this Agreement on behalf of each of the parties hereto represent and warrant that (i) such party, if not an individual, is duly organized and existing, (ii) they are duly authorized to execute and deliver this Agreement on behalf of said City Council Regular Meeting - Page 351 of 421
21 party, (iii) by so executing this Agreement such party is formally bound to the provisions of this Agreement, and (iv) the entering into this Agreement does not violate any provision of any other agreement to which such party is bound.

8.20 Notices. All notices under this Agreement shall be effective when delivered by United States Postal Service mail, registered or certified, postage prepaid return receipt requested; and addressed to the respective parties as set forth below or as to such other address as the parties may from time to time designate in writing by providing notice to the other party:

To City: City of Lynwood
11330 Bullis Road
Lynwood, CA 90262
Attn: City Manager
With Copy to: Alvarez-Glasman & Colvin
13181 Crossroads Parkway North, Suite 400
City of Industry, CA 91746
Attn: Noel Tapia, City Attorney

To Developer Bulletin Display, LLC
Official Land Lease Notice
3127 E. South Street, Suite B
Long Beach, CA 90805
Attn: Mark A. Kudler

8.21 Nonliability of City Officials. No officer, official, member, employee, agent, or representatives of City shall be liable for any amounts due hereunder, and no judgment or execution thereon entered in any action hereon shall be personally enforced against any such officer, official, member, employee, agent, or representative.

8.22 No Brokers. City and Developer represent and warrant to the other that neither has employed any broker and/or finder to represent its interest in this transaction. Each party agrees to indemnify and hold the other free and harmless from and against any and all liability, loss, cost, or expense (including court costs and reasonable attorneys' fees) in any manner connected with a claim asserted by any individual or entity for any commission or finder's fee in connection with this Agreement or arising out of agreements by the indemnifying party to pay any commission or finder's fee.

8.23 No Amendment of Lease. Nothing contained in this Agreement shall be deemed to amend or modify any of the terms or provisions of the Lease. Nothing contained in this Agreement shall constitute or be deemed to constitute a limit on any of Developer's obligations under the Lease.

8.24 Counterparts. This Agreement may be signed in any number of duplic ate counterparts, each of which, when combined, shall constitute one and the same document.

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22 (Signatures on Next Page)
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23 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first set forth above.

“City”

CITY OF LYNWOOD

Date:______________ ____________________________________ Jorge Casanova, Mayor

ATTEST:

_______________________________
Maria Quinonez, City Clerk

APPROVED AS TO FORM

_______________________________
Noel Tapia, City Attorney

“Developer”

BULLETIN DISPLAYS, LLC

Date:______________ ____________________________________ Its: Mark A. Kudler

[Principle Signatures to be Notarized]

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24 EXHIBIT A

LEGAL DESCRIPTION OF THE PROPERTY
(See Following Page)

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25 11350 Wright Rd. Lynwood, CA 90262; also known as Los Angeles County Assessor’s No. 6194-031-007

LEGAL

THAT PORTION OF THE RANCHO SAN ANTONIO, BEING ALSO A PORTION OF THE C. H.

WATTS LAND, IN THE CITY OF LYNWOOD, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 5 PAGE(S) 351 OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. , DESCRIBED AS FOLLOWS:

BEGINNING AT THE INTERSECTION OF THE EASTERLY LINE OF WRIGHT ROAD, WITH THE NORTHERLY LINE OF NORTON ROAD, "NOW CENTURY BOULEVARD"; THENCE A LONG SAID EASTERLY LINE, NORTH 20 ° 10' 25" EAST 295.02 FEET TO THE SOUTHWEST CORNER OF THE LAND DESCRIBED IN DEED TO WILLIAM R. QUINNEY, ET AL., RECORDED JANUARY 14, 1948 AS INSTRUMENT NO, 456 IN BOOK 26197, PAGE 380, OFFICIAL RECORDS OF SAID COUNTY; SAID POINT BEING THE TRUE POINT OF BEGINNING; THENCE CONTINUING NORTH 20 ° 10' 25" EAST 150 FEET TO THE NORTHWESTERLY CORNER OF SAID LAND OF

QUINNEY, THENCE EASTERLY ALONG THE NORTHERLY LINE OF SAID LAND OF QUINNEY, A DISTANCE OF 443.56 FEET; THENCE SOUTHERLY IN A DIRECT LINE TO A POINT IN THE SOUTHERLY LINE OF SAID LAND OF QUINNEY, EASTERLY THEREIN, A DISTANCE OF 475.46 FEET FROM THE TRUE POINT OF BEGINNING; THENCE ALONG SAID SOUTHERLY LINE NORTH 80 ° 36' 35" WEST 475.46 FEET TO THE TRUE POINT OF BEGINNING.

EXCEPT AN UNDIVIDED ONE -HALF INTEREST IN ALL OIL, GAS, MINERALS AND OTHER HYDROCARBON SUBSTANCES, IN OR UNDER SAID LAND, LYING BELOW A DEPTH OF 500

FEET FROM THE SURFACE THEREOF, BUT WITHOUT THE RIGHT OF SURFACE ENTRY TO TAKE, MARKET MINE, EXPLORE OR DRILL FOR SAME AS RESERVED BY V.J. TOVATT, A MARRIED MAN AS TO AN UNDIVIDED 96.46 PER CENT INTEREST AND KAREN MARIE TOVATT, AN UNMARRIED WOMAN AS TO AN UNDIVIDED 3.54 PER CENT INTEREST IN DEED RECORDED MARCH 11, 1969 AS INSTRUMENT NO. 51, OFFICIAL RECORDS.

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26 EXHIBIT B

SITE PLAN

(See Following Page)
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27 City Council Regular Meeting - Page 358 of 421
28 EXHIBIT C

ELEVATIONS

(See Following Page)
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29 City Council Regular Meeting - Page 360 of 421
Agenda Item # 24.

AGENDA STAFF REPORT
DATE:

August 2, 2022

TO:

Honorable Mayor and Members of the City Council

APPROVED BY:

Ernie Hernandez, City Manager

PREPARED BY:

Ernie Hernandez, City Manager
Noel Tapia, City Attorney

SUBJECT:

CONDUCT SECOND READING, READ BY TITLE ONLY, AND WAIVE FURTHER READING, AND ADOPT AN ORDINANCE AMENDING SECTION 25-2001-1 OF CHAPTER 25 (ZONING) OF THE LYNWOOD MUNICIPAL CODE AND APPENDIX A TO CHAPTER 25 (USES BY ZONING DISTRICT); AND CONDUCT SECOND

READING, READ BY TITLE ONLY, AND WAIVE FURTHER READING, AND ADOPT AN ORDINANCE ADDING SECTION 35 TO CHAPTER 4 LICENSING AND

BUSINESS REGULATIONS OF THE LYNWOOD MUNICIPAL CODE RELATING TO

THE LICENSING AND REGULATION OF CANNABIS RETAILERS AND
ACCOMPANYING AMENDMENTS TO SECTION 34 OF CHAPTER 4 LICENSING

AND BUSINESS REGULATIONS OF THE LYNWOOD MUNICIPAL CODE
Recommendation:

Staff respectfully recommends:

1. Conduct second reading, read by title only, and waive further reading, and adopt, the attached Ordinance entitled “AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LYNWOOD, CALIFORNIA AMENDING SECTION 25-200-1 OF CHAPTER 25 (ZONING) OF THE LYNWOOD MUNICIPAL CODE AND APPENDIX A TO CHAPTER 25 (USES BY ZONING DISTICT); and

2. Conduct second reading, read by title only, and waive further reading, and adopt, the attached Ordinance entitled “AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LYNWOOD ADDING SECTION 35 TO CHAPTER 4 LICENSING AND BUSINESS REGULATIONS OF THE LYNWOOD MUNICIPAL CODE

RELATING TO THE LICENSING AND REGULATION OF CANNABIS RETAILERS IN THE CITY OF LYNWOOD AND ACCOMPANYING AMENDMENTS TO SECTION 34 OF CHAPTER 4 LICENSING AND BUSINESS REGULATIONS OF THE LYNWOOD MUNICIPAL CODE; and

Background:

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The City Council, at its July19, 2022, Regular City Council meeting, introduced three ordinances related to a proposed retail cannabis licensing program.

One ordinance will amend the City’s zoning code to allow retail cannabis sales in various zones in the City.

The second ordinance will establish the procedures and guidelines for the retail cannabis license program.

The third ordinance is a tax measure that will become effective only if the voters approve the tax measure as part of the November 8, 2022 elections.

The City Council is now being asked to conduct second readings and adopt the ordinance amending the City’s zoning code and the ordinance establishing the procedures and guidelines for the retail cannabis license program.

A second reading for the tax ordinance is not appropriate because it will become an effective ordinance by operation of law if the voters approve the tax as part of the November 8, 2022 elections.

Discussion and Analysis:

Environmental Determination
The adoption of the Ordinance Amending Section 25-2001-1 of Chapter 25 (Zoning) of the Lynwood Municipal Code and Appendix A to Chapter 25 (Uses by Zoning District) is exempt from the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines Section 15061(b)(3), which states the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment. It may be seen with certainty that there is no possibility that the amendment of Chapter 25 (Zoning) and its Appendix A, which provides clarity, creates consistency of terms and definitions, amends the Zoning Code to reflect current commercial market trends may have a significant effect on the environment. Moreover, no specific project or use will be approved in any specific location in the City through the approval of this Ordinance.

The actions contemplated by the respective ordinances establishing a retail cannabis business license process and establishing a corresponding business license tax are exempt from the California Environmental Quality Act (“CEQA”) under Section 15060(c)(2) and Section 15060(c)(3) of Title 14 of the State of California (“State”) Code of Regulations and the holding by the State Supreme Court in Tuolumne Jobs & Small Business Alliance v.

Superior Court (2014) 59 Cal.4th 1029.

Fiscal Impact:

Staff projects that at the five percent cannabis business license tax rate will generate an estimated $3 to $6 million in new general fund revenues.

Coordinated With:

City Manager
City Attorney
ATTACHMENTS:

Description
Final Lynwood Cannabis Retail Sales Regulation Public Safety Ordinance City Council Regular Meeting - Page 362 of 421

1 CITY OF LYNWOOD

LOS ANGELES COUNTY, CALIFORNIA

ORDINANCE NO. _________

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LYNWOOD ADDING SECTION 35 TO CHAPTER 4 LICENSING AND BUSINESS

REGULATIONS OF THE LYNWOOD MUNICIPAL CODE RELATING TO

THE LICENSING AND REGULATION OF CANNABIS RETAILERS IN

THE CITY OF LYNWOOD AND ACCOMPANYING AMENDMENTS TO
SECTION 34 OF CHAPTER 4 LICENSING AND BUSINESS

REGULATIONS OF THE LYNWOOD MUNICIPAL CODE

WHEREAS, Section 7 of Article XI of the California Constitution authorizes the City of Lynwood (the “City”) to make and enforce within its jurisdictional limit ordinances and regulations not in conflict with general laws to protect and promote the public health, safety, and welfare of its residents; and

WHEREAS, on November 8, 2016, California voters approved Proposition 64, titled “The Adult Use of Marijuana Act ” and enacted a State-level statutory scheme for legalizing, controlling, and regulating commercial c annabis activity related to nonmedicinal cannabis for use by adults twenty-one (21) years of age and older, including the storefront retail sale of nonmedical cannabis for use by adults twenty-one (21) years of age and older, and on June 27, 2017, the Medicinal and Adult Use Cannabis Regulation and Safety Act was signed into law, which provides a comprehensive regulatory framework for licensing, control, and taxation of commercial cannabis activity related to medicinal and nonmedicinal use in California; and

WHEREAS, on December 20, 2016, the City Council of the City of Lynwood (the “City Council”) adopted Ordinance No. 1688 adding Chapter 4-34 to the City of Lynwood Municipal Code (the “City Municipal Code”) and accepting Planning Commission recommendations, with Chapter 4 -34 of the City Municipal Code being subsequently amended by Ordinance No. 1700 (adopted by the City Council on September 19, 2017) and by Ordinance No. 1707 (adopted by the City Council on January 2, 2018), licensing and regulating all forms of commercial cannabis activity, except the storefront retail sale of medicinal and nonmedicinal cannabis; and

WHEREAS, Chapter 4 -34 of the City Municipal Code presently prohibit s the storefront retail sale of medicinal and nonmedicinal cannabis; and

WHEREAS, the City Council desires to establish a strong and effective regulatory system with regard to the storefront retail sale of medicinal and nonmedicinal cannabis that protects the public health, safety, and environmental resources, provides a consistent City Council Regular Meeting - Page 363 of 421

2 regulatory pathway for the storefront retail sale of medicinal and nonmedicinal cannabis consistent with State regulations, fosters healthy, diverse , and economically viable the cannabis retailers that contribute to the local economy, and ensures that environmental, public health, safety and nuisance factors related to the storefront retail sale of medicinal and nonmedicinal cannabis are adequately addressed; and

WHEREAS, in furtherance of these goals, the City Council desires to add Chapter 4-35 to the City Municipal Code and amend Chapter 4-34 of the City Municipal Code to establish development standards and permitting requirements to allow the storefront retail sale of medicinal and nonmedicinal cannabis within limited City zoning districts; and

WHEREAS, the City Council further desires to implement reasonable regulations that are intended to address the secondary negative impacts to the City and its resources, including, nuisance impacts and criminal impacts that may result from the operation of cannabis retailers in the City and to ensure that the effects such impacts may have on the health, safety, and welfare of businesses and residents within the City are mitigated to the greatest extent possible; and

WHEREAS, the City Council is aware that both community benefits and potential adverse impacts may result from the operation of cannabis retailers in the City, and , therefore, desires to: (1) help ensure that all such impa cts are adequately mitigated and offset by the potential community benefits those businesses can provide to the City and its residents and (2) to help provide sufficient code enforcement and law enforcement resources to address such adverse impacts and to ensure compliance with all applicable laws and regulations.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES ORDAIN AS FOLLOWS:

SECTION 1. This Ordinance shall be known and may be cited as “The Lynwood Cannabis Retail Sales Regulation and Public Safety Ordinance” (the “Ordinance”).

SECTION 2. Purpose and Intent. The purpose and intent of this Ordinance is to accommodate the needs of medically -ill persons in need of cannabis for medicinal purposes, as advised and recommended by their health care provider(s), and adults over the age of twenty -one (21), and to implement State of California (“State”) law, w hich includes, but is not limited to the provisions of the Medicinal & Adult -Use Cannabis Regulation & Safety Act (hereinafter, “MAUCRSA”), as may be amended and augmented under State law, while imposing regulations on the conduct of business and use of land to protect the City of Lynwood’s (the “City”) neighborhoods, residents, and businesses from negative impacts. It is a further purpose and intent of this Ordinance to regulate the retail sale of cannabis and cannabis products in a manner which is responsible, which protects the health, safety, and welfare of the residents of the City, and which enforces rules and regulations consistent with State law. In part to meet these objectives, a retail City Council Regular Meeting - Page 364 of 421

3 cannabis business permit shall be required to own or to operate a cannabis retailer within the City. Further, this Ordinance’s requirement for a cannabis retailer to possess a retail cannabis business permit is in addition to any other permits, licenses , and approvals which may be required to conduct business in the City, and is in addition to any permits, licenses, and approvals required under State or County of Los Angeles (“County”) law.

SECTION 3. Legal Authority. Pursuant to Section 7 of Article X I of the State Constitution, and the provisions of the MAUCRSA, as may be amended and augmented under State law and any subsequent State legislation regarding the same, the City is authorized to adopt ordinances that establish standards, requirements, and regulations for local licenses and permits for cannabis retailers. Except as otherwise provided in this Ordinance, any standards, requirements, and regulations regarding hea lth and safety, security, and worker protections established by the State, or any of its departments or divisions, shall be the minimum standards applicable to the retail sale of cannabis and cannabis products in the City.

SECTION 4. Chapter 4 (Licensing and Business Regulations) of the City Municipal Code is hereby amended by adding Chapter 4-35 (Cannabis Retailers) to read as follows:

Chapter 4-35: CANNABIS RETAILERS

4-35.1: Cannabis retailers prohibited unless specifically authorized.

a. Except as specifically authorized by this Chapter 4-35, to the fullest extent permitted by State law, the City expressly prohibits any and all cannabis retailers within the City.

b. Nothing in this Chapter 4-35 shall be construed or interpreted to permit the commercial possession, furnishing, manufacture, cultivation, distribution, processing, storing, laboratory testing, packaging, labeling, transportation, delivery, or sale of industrial hemp.

c. To the extent expressly authorized in this Chapter 4-35 of the City Municipal Code, cannabis retailers are permitted in the City, subject to the satisfaction of all requirements set forth in this Chapter 4-35, MAUCRSA, and all other applicable State and local laws, rules, and regulations.

4-35.2: Compliance with laws.

It is the responsibility of the owners, managers, officers, employees, and agents of any cannabis retailer to ensure that it is operating in a manner compliant with all applicable State and local laws and any regulations promulgated thereunder. Nothing in this Chapter 4-35 shall be construed as in conflict with State law.

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4 4-35.3: Definitions.

When used in this Chapter 4-35, the following words shall have the meanings ascribed to them as set forth herein. Words and phrases not specifically defined below shall have the meanings ascribed to them elsewhere in this Code or shall otherwise be defined by common usage. For definitions of nouns, the singular shall also include the plural; for definitions of verbs, all verb conjugations shall be included. Any reference to State statutes includes any regulations promulgated thereunder and is deemed to include any successor or amended version of the referenced statute or regulatory provision.

“Applicant” means the person applying for the retail cannabis business permit under this Chapter 4-35 (not the owners or the managers of the applicant).

“Cannabis” has the same meaning as defined in Chapter 4-34 of the City Municipal Code.

“Cannabis Concentrate” means cannabis that has undergone a process to concentrate one or more active cannabinoids, thereby increasing the product’s potency. Resin from granular trichomes from a cannabis plant is a concentrate for purposes of this Chapter 4-

35. A cannabis concentrate is not considered food, as defined by Section 109935 of the State Health & Safety Code, or drug, as defined by Section 109925 of the State Health & Safety Code.

“Cannabis Product” means cannabis that has undergone a process whereby the plant material has been transformed into a concentrate, including, but not limited to, concentrated cannabis, or an edible or topical product containing cannabis or concentrated cannabis and other ingredients.

“Cannabis Retailer” or “ Retailer” or “ Dispensary” means a location where cannabis, cannabis products, or devices for the use of cannabis or cannabis products are offered, either individually or in any combination, for retail sale, including a cannabis retailer establishment that delivers cannabis and cannabis products.

“Caregiver” or “Primary Caregiver” has the same meaning as that term is defined in Section 11362.7 of the State Health & Safety Code.

“City” means the City of Lynwood.

“City Attorney” means the City Attorney of the City of Lynwood or his or her designee(s).

“City Council” means the City Council of the City of Lynwood.

“City Manager” means the City Manager of the City of Lynwood or his or her designee(s).

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5 “Commercial Cannabis Activity” has the same meaning as defined in Chapter 4 -34 of the City Municipal Code

“Commercial Cannabis Business” has the same meaning as defined in Chapter 4 -34 of the City Municipal Code.

“County” means the County of Los Angeles.

“Customer” means a natural person twenty-one (21) years of age or over or a natural person eighteen (18) years of age that is a qualified patient or primary caregiver.

“Day Care Center” or “Childcare Facility” means a facility, other than a family day care home, serving infant, toddler, preschool, and school age children , licensed by the State Department of Social Services pursuant to Section 1596.951 of the State Health & Safety Code. Pursuant to the authority delegated by the State to the City under Section 26054(b) of the State Business & Professions Code, this definition of “Day Care Center” under this Chapter 4-35 shall override the definition of “ Day Care Center” in MAUCRSA at Section 26001 of the State Business & Professions Code.

“Delivery” has the same meaning as defined in Chapter 4-34 of the City Municipal Code.

“Edible Cannabis Product” means a cannabis product that is intended to be used, in whole or in part, for human consumption, including, but not limited to, chewing gum, but excluding products set forth in Division 15 (commencing with Section 32501) of the State Food & Agriculture Code. An edible cannabis product is not considered food, as defined by Section 109935 of the State Health & Safety Code, or drug, as defined by Section 109925 of the State Health & Safety Code. An edible cannabis product shall not be deemed to be adulterated pursuant to Section 26131 of the State Business & Professions Code solely because it contains cannabis.

“Employee” means each natural person employed by a cannabis retailer who is a part- time, full-time, temporary, or permanent employee.

“Gross receipts ” means, except as otherwise specifically provided herein, whether designated as a sales price, royalty, rent, commission, dividend, or other designation, the total amount (including all receipts, cash, credits , and property of any kind or nature) received or payable for sales of goods, wares, or merchandise without any deduction therefrom on account of the cost of the property sold, the cost of materials used, labor, or service costs, interest paid or payable, losses, or any other expense whatsoever.

However, the following shall be excluded from gross receipts:

a. Cash discounts where allowed and taken on sales;

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6 b. Any tax required by law to be included in or added to the purchase price and collected from the consumer or purchaser;

c. Such part of the sale price of any property returned by purchasers to the seller as refunded by the seller by way of cash or credit allowances or return of refundable deposits previously included in gross receipts;

d. Receipts derived from the occasional sale of used, obsolete, or surplus trade fixtures, machinery, or other equipment used by the taxpayer in the regular course of the taxpayer’s business;

e. Cash value of sales, trades, or transactions between departments or units of the same business;

f. Receipts of refundable deposits, except that such deposits when forfeited and taken into income of the business shall not be excluded when in excess of one dollar; and

g. Any proceeds resulting from a transfer or change of ownership or control in the business.

“Labor Peace Agreement” means an agreement between a cannabis retailer and any bona fide labor organization that, at a minimum, protects the City’s proprietary interests by prohibiting labor organizations and members from engaging in picketing, work stoppages, boycotts, and any other economic interference with a cannabis retailer. This Agreement means that the cannabis retailer has agreed not to disrupt efforts by the bona fide labor organization to communicate with, and attempt to organize and represent, t he cannabis retailer ’s employees. The Agreement shall provide a bona fide labor organization access at reasonable times to areas in which the cannabis retailer ’s employees work, for the purpose of meeting with employees to discuss their right to representation, employment rights under State law, and terms and conditions of employment.

“Licensing Authority” means a State agency responsible for the issuance, renewal, or reinstatement of State license, or a State agency authorized to take disciplinary action against a State licensee.

“Liquid Assets” means assets that can be readily converted into cash. “Liquid asset s” include, but are not limited to, the following: funds in checking or savings accounts, certificates of deposit, money market accounts, mutual fund shares, publicly traded stocks, and United States savings bonds. “Liquid assets” does not mean household items, furniture and equipment, vehicles, cannabis or cannabis products, business inventory, or real property and improvements thereto.

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7 “Manager” means a ny individual who will be participating in the direction, control, or management of an applicant or a permittee, including but not limited to, any (i) manager or managing member or other officer of a limited liability company applicant or permittee or (ii) president, chief executive officer, secretary, treasurer, chief financial officer, or other officer of a for profit corporation applicant or permittee.

“Marijuana” means “cannabis” as that term is defined in this Chapter 4-35.

“MAUCRSA” means Division 10 (commencing with Section 26000) of the State Business and Professions Code and any regulations promulgated thereunder.

“Ordinance” means The Lynwood Cannabis Retail Sales Regulation and Public Safety Ordinance.

“Owner” means any of the following:

a. A person owning in the aggregate equity interests representing twenty (20) percent or more of the voting power of all outstanding equity in the applicant or a permittee;

b. The president, chief executive officer, secretary, treasurer, or chief financial officer of a nonprofit applicant or permittee; or

c. A member of the board of directors of a nonprofit applicant or permittee.

Notwithstanding the above, every applicant and permittee must have at least one individual person designated as an “owner” for the purpose of compliance with this Chapter 4-35, including the review and evaluation of any retail cannabis business permit application.

“Panic Button” means a n emergency electronic contact device which allows an employee in the event of an ongoing crime, threat, or other emergency to alert a security guard responsible for providing immediate on-scene assistance.

“Patient” or “Qualified Patient” means a natural person who is entitled to the protections of Section 11362.5 of the State Health & Safety Code and includes a person issued an identification card issued pursuant to Article 2.5 of Chapter 4-35 of Division 10 of the State Health & Safety Code.

“Permittee” means the holder of a valid, City-issued retail cannabis business permit.

“Person” means an individual/natural person, firm, partnership, joint venture, association, corporation, limited liability company, estate, trust, business trust, receiver, syndicate, or any other group or combination acting as a unit and includes the plural as well as the singular number.

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8 “Person With An Identification Card ” shall have the meaning given to that term in Section 11362.7 of the State Health & Safety Code.

“Premises” means the designated structure or structures and land specified in the retail cannabis business permit application that is owned, leased, or otherwise held under the control of the applicant or permittee where cannabis retail sales will be or is conducted.

The premises shall be a contiguous area and shall only be occupied by one permittee.

“Public Park” means an outdoor premises containing existing or proposed parks, including community parks, neighborhood parks, mini -parks, and urban parks that are currently or proposed to be owned or operated by the City or other governmental agency. “Public Park” shall not include any youth center.

“Retail Cannabis Business Permit ” means a regulatory permit/license issued by the City pursuant to this Chapter 4-35 to a cannabis retailer and is required before any cannabis retail sales may be conducted in the City and is made expressly contingent upon the cannabis retailer’s ongoing compliance with all of the requirements of this Chapter 4- 35 and any regulations adopted by the City governing cannabis retail sales.

“Retail Sale(s)” or “Dispensing” means any activity involving the retail sale of cannabis or cannabis products from a retailer.

“Sale” means any sale, exchange, or barter or other transaction for any consideration.

“School” means as evidenced by the State Department of Education school directory, a public school instructing children in grades kindergarten through 12, as authorized by the State Department of Education or a private school instructing children in grades kindergarten through 12 that has filed a verification of private school affidavit with the State Department of Education pursuant to Section 33190 of the State Education Code, excluding any private school in which education is primarily conducted in a private home.

Pursuant to the authority delegated by the State to the City under Section 26054(b) of the State Business & Professions Code, this definition of “school” under this Chapter 4-35 shall override the definition of “school” used in MAUCRSA or Section 11362.768 of the Health & Safety Code.

“State” means the State of California.

“State License” means a permit or license issued by the State, or one of its departments or divisions, under MAUCRSA and any subsequent State legislation regarding the same to engage in cannabis retail sales.

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9 “Topical Cannabis” means a cannabis product intended for external application and/or absorption through the skin. A topical cannabis product is not considered a drug as defined by Section 109925 of the State Health & Safety Code.

“Youth Center” means any facility that is operated by a public agency or nonprofit entity with the sole purpose of providing educational and/or recreational services to minors. “Youth center” shall not include (a) any public park, (b) any private martial arts, yoga, ballet, music, or similar studio of this nature , or (c) any private athletic training facility, pizza parlor, restaurant, video arcade, dentist office, or doctor’s office primarily serving children. Pursuant to the authori ty delegated by the State to the City under Section 26054(b) of the State Business & Professions Code, this definition of “youth center” under this Chapter 4-35 shall override the definition of “youth center” in MAUCRSA at Section 26001 of the State Business & Professions Code.

4-35.4: Retail Cannabis Business Permit Required.

a. No person shall operate a cannabis retailer or engage in cannabis retail sales within the City unless such business or activity is currently in compliance with all applicable State and local laws, rules, and regulations and the cannabis retailer has all of the following:

1. A valid City business license to conduct such business or activity;

2. A valid retail cannabis business permit issued by the City pursuant to this Chapter 4-35 to conduct such business or activity;

3. A valid State license authorizing such business or activity in the City; and

4. A valid certificate of occupancy issued by the City’s Building & Safety Division to conduct the cannabis retail sales at the premises identified in the retail cannabis business permit.

4-35.5: Number of Authorized Cannabis Retailers Permitted.

a. The City Council may award up to six retail cannabis business permits within the City.

b. Nothing in this Chapter 4-35 creates a mandate that the City must authorize any specific number of retail ca nnabis businesses permits. The City reserves the discretion to determine that it is in the best interest of the City to not issue the full number of retail cannabis business permits authorized in this Section 4-35.5 or to reduce the number of retail cannabis business permits authorized in this Section 4-35.5. However, the City may not increase the number of retail cannabis business permits authorized in this Section 4-

35.5, except as required by (i) a judicial remedy or (ii) a vote of the people of the City.

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10 4-35.6: Location and Design Requirements for Cannabis Retailers.

Pursuant to the authority delegated by the State to the City under Section 26054(b) of the State Business & Professions Code and overriding the location and design requirements contained in Section 26054(b) of the State Business & Professions Code , cannabis retailers in the City shall be subject to the following location and design requirements:

a. Cannabis retailers shall be a permitted use subject to this Chapter 4-35 on property (1) located more than six-hundred-fifty (650) feet from any school or day care center, (2) located more than nine-hundred-fifty (950) feet from any public park or youth center, and (3) zoned: C-2A (Medium Commercial District), C-3 (Heavy Commercial District), or M (Manufacturing District), including any overlay zones, in particular any SPA (Specific Plan Area) covering the C-2A (Medium Commercial District), C-3 (Heavy Commercial District), or M (Manufacturing District)

b. The distances specified in this Section 4-35.06 shall be the horizontal distance measured in a straight line from the parcel line of the sensitive use to the closest parcel line of the lot on which the cannabis retailer is to be located without regard to intervening structures.

c. Each cannabis retailer shall:

1. Be constructed in a manner that prevents odors to surrounding uses, and promotes quality design and construction, and consistency with the surrounding properties. Odors from the cannabis retailer shall not be detectable from outside the premises and adequate odor control technology shall be utilized;

2. Be provided with adequate electricity, sewerage, disposal, water, fire protection, and storm drainage facilities for the intended purpose; and

3. Provide and maintain a neighborhood compatibility plan so the City Manager or designee(s) may find that the cannabis retailer and its operating characteristics are not detrimental to the public health, safety, convenience, or welfare of persons residing, working, visiting, or recreating in the surrounding neighborhood and will not result in the creation of a nuisance.

4-35.7: Cannabis Retailer Application Procedure.

a. The City Manager, pursuant to Section 4-35.22, shall, as a ministerial duty, make available the necessary forms, adopt any necessary application rules for the submission, intake, review, and approval of retail cannabis business permit applications for retailers up to the number of retail cannabis business permits authorized in Section 4-35.5.

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11 b. The City Manager shall, as a ministerial duty, cease acceptance of retail cannabis business permit applications thirty (30) days after making available the necessary forms and adopting any necessary application rules for the submission, intake, review, and approval of retail cannabis business permit applications for retailers.

c. The City Manager shall, as a ministerial duty, review timely submitted retailer applications for the following minimum requirements:

1. Payment of a non-refundable application fee established by resolution of the City Council;

2. Sufficient evidence of the legal right to use the proposed property for the proposed use, to include ownership, a lease, sublease, purchase agreement, assignment of purchase agreement, or lease or purchase option, in the name of the applicant, which may include nominal consideration and be contingent upon issuance of a retail cannabis business permit or other approvals. The City shall only consider one applicant per County Assessor’s Identification Number. In the event that more than one applicant applies for a retail cannabis business permit application at a given property address or a given County Assessor’s Identification Number , the City Manager shall, as a ministerial duty, only accept the retail cannabis business permit application with the earliest effective date for the evidence of the legal right to use the proposed property for the proposed use in the name of the applicant;

3. Sufficient evidence to demonstrate that the proposed property complies with location and zoning requirements in Section 4-35.6;

4. Proof of funds showing that the Applicant has access and control of over $1,000,000.00 in liquid assets (which such liquid assets having been under possession for at least ninety (90) days prior to the date of the application submission under this Section), which may be shown via a binding legal agreement in the name of the Applicant such as a promissory note so long as said legal agreement is accompanied by a proof of funds in the name of a party to the agreement so long as that demonstrates access and control of over $ 1,000,000.00 in liquid assets under possession for at least ninety (90) days prior to the date of the application submission under this Section . Applicants and Permittees shall not be required to show that the Applicant or Permittee has access and control of over $1,000,000.00 in liquid assets except on initial application pursuant to this Section 4-35.7, a change in location application pursuant to Section 4-35.13, or an ownership transfer application pursuant to Section 4-35.14;

5. A set of plans, including a site development plan, floor plan (s), building elevations (all four (4) sides), and a conceptual landscape plan with the percentage of landscaping in the parking lot, setback areas, and tree size and species;

6. Colored interior and elevation renderings;
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12 7. A completed background check application and receipt for each owner and manager of the Applicant pursuant to Section 4-35.18(l); and

8. The following application components: (a) Qualifications of the Applicant’s owners and managers; (b) business and operations plan; (c) security plan; (d) safety plan; (e) neighborhood compatibility plan; (f) labor and employment plan ; and (g) community benefits plan.

The City Manager shall, as a ministerial duty, reject any retail cannabis business permit application that fails to meet the minimum requirements contained in this Subsection c, and applicants shall not have the right to supplement or amend their retail cannabis business permit applications once the City Manager has closed the window to submit an application.

d. The City Manager shall, as a ministerial duty review and score any complete applications pursuant to the following objective review criteria, according to the following quantitative evaluation scale that holds a total criteria value of 1,000 points:

1. Qualifications of the Applicant’s Owners and Managers – 200 points

The City Council finds that a proven track -record of (i) business operations provid ing services or operating in the City or (ii) cannabis retailer operations experience, wherever performed, that successfully generate tax revenue carries out the purpose and intent of the Ordinance and are, therefore, critical for an applicant to demonstrate the qualifications of the Applicant’s Owners and Managers. Accordingly, 150 of the 200 points awardable under this Subsection 1 shall only be awarded, as a ministerial duty, (i) if an owner or owners of the Applicant with an aggregate ownership interest of fifty-one (51) percent or more is currently at the time of application submission under this Section and since at least February 1, 202 0, the President, CEO, or limited liability company manager of a business that provides (or has provided ) services or operates (or has operated) in the City and that has generated at least $8,000,000.00 in annual gross receipts as demonstrated by the most recent tax payment receipts from, tax filings to, or tax returns filed by the business with a city, county, state, of the federal government or by a letter from a certified public accountant attesting to the business ’s gross receipts or (ii) if an owner or owners of the Applicant with an aggregate ownership interest of fifty -one (51) percent, is currently at the time of application submission under this Section an owner or owners with an aggregate ownership interest of fifty -one (51) percent of (or is an owner as a result of being the chief executive officer of a nonprofit entity of) a single licensed and lawfully operating commercial cannabis retailer operation (excluding any non-retailer microbusiness, cultivation, manufacturing, distribution, or other non -retailer commercial cannabis operation components) that has generated at least $5,000,000.00 in gross receipts in a consecutive six-month period in the year immediately preceding the date of the application submission under this Section, as demonstrated by tax payment receipts City Council Regular Meeting - Page 374 of 421

13 from, tax filings to, or tax returns filed with a city, county, or state or by a letter from a certified public accountant attesting to the cannabis retailer’s gross receipts.

The remaining 100 of the 200 points awardable under this Subsection 1 shall be awarded, as a ministerial duty, pursuant to the following objective criteria:

a. Up to 50 points – A d escription of the Applicant’s owner(s) and manager (s) qualifications detailing any experience operating cannabis retailers in any jurisdiction where cannabis retailers are permitted or special business or professional qualifications or licenses of the applicant’s owner (s) and manager(s) that would add to the quality of services that the cannabis retailer would provide, including in areas related to cannabis, such as legal, finance, business ownership/administration, waste management, real estate development, scientific, or healthcare or wellness fields.

2. Plans, renderings, and overall location – 150 points

The City Council finds that the further a cannabis retailer is located away from youth centers, the better a cannabis retailer will carry out the purpose and intent of the Ordinance (in particular the use of land to protect the City’s neighborhoods, residents, and businesses from negative impacts) and that the sensitive use buffer for youth centers contained in Section 4-35.6 is a minimum rather than an ideal distance to carry out the purpose and intent of the Ordinance. Accordingly, 75 of the 150 points awardable under this Subsection 2 shall only be awarded, as a ministerial duty, if an Applicant’s proposed cannabis retailer is located on property located more than one -thousand five-hundred (1,500) feet from any youth centers identified and measured pursuant to Section 4-35.6 above and Section 14 of the Ordinance.

The remaining 75 of the 150 points awardable under this Subsection 2 shall be awarded, as a ministerial duty, pursuant to the following objective criteria:

(a) Up to 10 points – A premise diagram in accordance with Section 5006 of Division 42 of Title 16 of the State Code of Regulations.

(b) Up to 10 points – A site development plan that provides information on existing conditions and proposed improvements to the site and how it meets or will meet the development standards outlined in Chapter 25 of the City Municipal Code , including adequate parking . Information on existing conditions shall include:

1) Exterior photographs showing all sides of any existing structure(s);

2) Photographs of existing parking areas, landscaping, trash enclosure, and signage;
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14 3) Information on existing use on the site, including the addresses, uses, and square footages.

4) Photographs of the existing site if the site is vacant; and

5) Photographs of adjacent properties for context.

(c) Up to 15 points – A floor plan showing information on the existing layout and proposed layout of the building interior.

(d) Up to 20 points – Building elevations that provide information on existing conditions and proposed improvements.

(e) Up to 10 points – A conceptual landscape plan with the percentage of landscaping in the parking lot, setback areas, and tree size and species.

(f) Up to 10 points – Colored interior renderings and exterior elevation renderings (for both existing and/or proposed improvements).

3. Business and operations plan – 100 points

The 75 points awardable under this Subsection 3. shall be awarded, as a ministerial duty, pursuant to the following objective criteria:

(a) Up to 5 points – A written description of the total square footage of the facility with estimated square footage of proposed uses.

(b) Up to 10 points – A schedule for beginning operations, including a narrative outlining any proposed construction improvements and a timeline for completion.

(c) Up to 15 points – A budget for construction, operation, maintenance, compensation of employees, equipment costs, utility costs, and other operating costs.

(d) Up to 10 points – A description of the sources(s) of capital and use(s) of capital.

(e) Up to 10 points – Pro forma financial statements for at least three (3) years of operation.

(f) Up to 10 points – A description of the type of products to be sold and the estimated quantity and value of product(s) to be sold.

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15 (g) Up to 15 points – A description of marketing procedures and tactics.

(h) Up to 5 points – A description of day -to-day operations that should acknowledge both state and local laws and should be consistent with industry best practices.

(i) Up to 5 poi nts – A description of hours of operation and opening procedures.

(j) Up to 5 points – A description of cash handling procedures.

(k) Up to 5 points – A description of inventory control procedures to include identification of point-of-sale systems, and track and trace software.

(l) Up to 5 points – A description of transportation, loading and unloading, distribution, or delivery procedures.

4. Security plan – 100 points

The 100 points awardable under this Subsection 4. shall be awarded, as a ministerial duty, pursuant to the following objective criteria:

(a) Up to 20 points – The security plan shall be prepared by a professional security consultant.

(b) Up to 10 points – A premises security diagram.

(c) Up to 50 points – A description of access control, inventory control, cash handling, and other security procedures and security equipment demonstrating compliance with the security requirements under this Chapter 4-35.

(d) Up to 10 points – A description of the intrusion alarm and monitoring system including the name and contact information for the monitoring company.

(e) Up to 10 points – A description of the services of on -site security guards to include the ( 1) number of security guards; ( 2) the hours security guards will be on -site; (3) locations where security will be positioned; and (4) security guard responsibilities.

5. Safety plan – 100 points

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16 The 100 points awardable under this Subsection 5. shall be awarded, as a ministerial duty, pursuant to the following objective criteria:

(a) Up to 20 points – The safety plan shall be prepared by a professional fire prevention and suppression consultant.

(b) Up to 10 points – A premises safety diagram to include ( 1) a description/illustration of evacuation routes and ( 2) location of fire extinguishers and other fire suppression equipment.

(c) Up to 50 points – A description of safety procedures, training for emergency situations, and safety equipment demonstrating compliance with the safety requirements under this Chapter 4-35.

(d) Up to 10 points – Identify all gases, pesticides, and chemicals to be used and their storage locations.

(e) Up to 10 points – A description of the firm alarm and monitoring system including the name and contact information for t he monitoring company.

6. Neighborhood compatibility plan – 150 points

The 75 points awardable under this Subsection 6. shall be awarded, as a ministerial duty, pursuant to the following objective criteria:

(a) Up to 75 points – A “Good Neighbor Policy” that (1) includes policies and measures in place to protect adjacent uses from any potential impacts (e.g., noise, light, odor, traffic, etc.) related to the proposed cannabis retailer, including addressing parking and traffic impacts and (2) describes how the cannabis retailer and its operating characteristics will be proactively managed so the business is not detrimental to the public health, safety, convenience, or welfare of persons residing, working, visiting, or recreating in the surrounding area and will not result in the creation of a nuisance.

(b) Up to 25 points – A description of odor mitigation practices to include:
(1) identifying potential sources of odor; ( 2) a description of odor control devices and techniques employed to ensure that odors from cannabis are not detectable beyond the permitted premises; and ( 3) all proposed staff odor training and system maintenance.

(c) Up to 25 points – A description of a waste management plan that includes waste disposal locations within the proposed premises and the City Council Regular Meeting - Page 378 of 421

17 applicant’s security measures and methods of rendering waste unusable and unrecognizable.

(d) Up to 25 points – A description of efforts at
sustainability/environmental impact mitigation.

7. Community benefits plan – 100 points

The City Council finds that monetary donations to support City sponsored activities and programs carry out the purpose and intent of the Ordinance and are, therefore, critical for an applicant to demonstrate an effective community benefits plan. Accordingly, 80 of the 100 points awardable under this Subsection 7. shall only be awarded if the Applicant pledges to voluntarily provide a public benefit to a public use (or a combination thereof), which is defined as a direct financial contribution equal to one (1) percent of projected gross receipts of the applicant to the following City sponsored programs/causes : (a) senior citizen programs, (b) City beautification efforts, (c) fund for enforcement of illegal cannabis operations, (d) public safety, (e) housing programs, (f) recreation services, (g) infrastructure, (h) general fund, and/or (i) any other proposed Cit y efforts. Beyond the above, no further direct financial contributions shall be considered as part of an applicant’s community benefits plan.

The remaining 20 of the 100 points awardable under this Subsection 7. shall be awarded, as a ministerial duty, pursuant to the following objective criteria:

(a) Up to 10 points – A description of a social responsibility plan to include identification of a community liaison and plans to aide and participate in the work of local non-profits, community-based organizations, civic organizations, or social services organizations.

(b) Up to 10 points – A description of a plan to develop a public health outreach and educational program that outlines the risks of youth use of cannabis and that identifies resources available to youth related to drugs and drug addiction.

8. Labor and employment plan – 100 points

The 100 points awardable under this Subsection 8. shall be awarded, as a ministerial duty, pursuant to the following objective criteria:

(a) Up to 5 points – An organizational chart of showing owners, managers, and employees.

(b) Up to 5 points – A description of the owner’s and manager’s roles in day-to-day operations and decisions.

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18 (c) Up to 5 points – A description of the number of employees, title/position, and their respective responsibilities

(d) Up to 15 points – A description of compensation to employees, opportunities for continuing education, and employee training.

(e) Up to 20 points – A description of whether the cannabis retailer is committed to offering employees a living wage.

(f) Up to 15 points – A description of benefits provided to employees such as health care, vacation, and medical leave, to the degree they are offered as part of employment.

(g) Up to 5 points – A description of a plan to recruit employees from socially and economically disadvantaged backgrounds.

(h) Up to 30 points – A description of a plan to have at least fifty (50) percent of employee positions filled, and hours worked by employees residing in the City.

e. Upon timely receipt of a retail cannabis business permit application, the City Manager shall conduct background checks in accordance with Section 4-35.18(l).

Following review and scoring of complete applications pursuant to objective review criteria under Subsection d., the City Manager shall, as a ministerial duty, rank all applicants according to their scores received from Subsection d, and schedule meetings with an ad hoc committee formed by the C ity Council to review and interview up to the top 12 ranked applicants. Following its review and interview of the selected applicants, the ad hoc committee, in conjunction with City staff, shall score and rank the applicants and recommend up to the top 8 applicants for the City Council’s consideration of an award of retail cannabis business permits. Upon receipt of the ad hoc committee’s recommendations, the City Manager shall schedule the consideration of an award of retail cannabis business permits at a meeting of the City Council. The City Council shall consider the applicants in order of their rank as determined by the ad hoc committee. The selected applicants will be afforded the opportunity to make a 5 -minute public presentation to the City Council describing each of their retail cannabis business permit applications and addressing the objective review criteria and quantitative evaluation scale in Subsection d. Following the presentations made by the applicants described in this Subsection e., the City Council may issue retail cannabis business permits to applicants up to the number of retail cannabis business permit s authorized in Section 4-35.5, with the applicants selected for a retail cannabis business permit being issued at the sole discretion of the City Council. In so issuing retail cannabis business permits to applicants up to the number of retail cannabis business permits authorized in Section 4 -35.5 at its sole discretion, the City Council shall have th e absolute discretion to (1) award retail City Council Regular Meeting - Page 380 of 421

19 cannabis business permits in accordance with the ranking order of applicants as determined by the ad hoc committee or in accordance with its own determination following the presentations made by the applicants to the City Council and (2) issue the retail cannabis business permits contingent on the City enacting a legally effective means for taxing cannabis retailers. However, the City Council shall not issue a retail cannabis business permit to any applicant with an owner or manager that:

1. Provided false or misleading information on the applicant’s retail cannabis business permit application;

2. Has been convicted of (or pled no contest to) “an offense that is substantially related to the qualifications, functions, or duties of the business or profession for which the application is made” as that term is defined in 26057(b)(4) of the State Business & Professions Code; or

3. Has been sanctioned by a licensing authority or a city, county, or state for unlicensed commercial cannabis activities or has had a license suspended or revoked under MAUCRSA in the three (3) years immediately preceding the date the application was submitted.

f. Any decision of the City Manager or City Council under this Section 4-35.7 shall be a final administrative decision not subject to administrative appeal under any provisions of this Chapter 4-35 or any provisions of the City Municipal Code but, rather , subject to judicial review and remedies.

g. In the event that the City Council is ordered to increase the number of retail cannabis business permits issued for retailers by a court of competent jurisdiction as a judicial remedy, the City Manager shall, as a ministerial duty, reinstitute the application procedure under this Section 4-35.7, subject to the number of retail cannabis business permits for retailers authorized and available (not allocated to an active, lawfully operating retailer) for issuance. In the event that the number of active, operating retailers and issued retail cannabis business permits falls below the number of retail cannabis business permits for retailers authorized in Section 4-35.5, the City Council may, at its sole discretion, require the City Manager, as a ministerial duty, to reinstitute the application procedure under this Section 4-35.7, subject to the number of retail cannabis business permits for retailers authorized and available (not allocated to an active, lawfully operating retailer) for issuance. For the purpose of this Section, a retailer shall be considered operating if (1) upon initial issuance of retail cannabis business permit (or approval of a change in location pursuant to Section 4-35.13), the retailer commences lawful operations within twenty-four (24) months (subject to the City Manager providing extensions in his or her reasonable discretion if the permittee can demonstrate that the delay was due to situations beyond its control and/or that significant progress towards establishing the use has been made) or (2) following initial commencement of lawful operations, the retailer does not cease or abandon operations for one-hundred twenty (120) consecutive or City Council Regular Meeting - Page 381 of 421

20 cumulative days in any one (1) year period. A retailer’s failure to commence lawful operations within twenty -four (24) months or following initial commencement of lawful operations, the retailer abandons operations for one -hundred twenty (120) consecutive or cumulative days in any one (1) year period shall be considered a material violation of this Chapter 4-35.

4-35.8: Limitations on the City’s liability.

To the fullest extent permitted by law, the City shall not assume any liability whatsoever with respect to having issued a retail cannabis business permit pursuant to this Chapter 4-35 or otherwise approving the operation of any cannabis retailer. As a condition to the approval of any retail cannabis business permit , the applicant shall be required to meet all of the following conditions before they can receive a retail cannabis business permit:

a. Execution of an agreement, in a form approved by the City Attorney, agreeing to indemnify, defend (at applicant ’s sole cost and expense), and hold the City, and its officers, officials, employees, representatives, and agents, harmless, from any and all claims, losses, damages, injuries, liabilities, or losses which arise out of, or which are in any way related to, the City’s issuance of the retail cannabis business permit, the City’s decision to approve the operation of the cannabis retailer or activity, the process used by the City in making its decision, or the alleged violation of any federal, State, or local laws by the cannabis retailer or any of its officers, employees, or agen ts. This obligation shall commence immediately upon the City’s selection of an applicant for a retail cannabis business permit.

b. Maintain insurance at coverage limits, and with conditions thereon determined necessary and appropriate from time to time by the City Attorney.

c. Defend and indemnify the City for all costs and expenses, including but not limited to attorneys’ fees and court costs, that the City may be required to pay as a result of any legal challenge related to the City’s approval of the applicant’s retail cannabis business permit or related to the City’s approval of a cannabis retail sales. In such instance, the City shall have the right to choose the defense counsel to represent the City at the sole expense of the permittees. A permittee’s failure to pay the City its proportional share of costs within forty-five (45) days following the City providing the permittee notice of the City’s exercise of its indemnity rights herein shall be considered a material violation of this Chapter 4-35. This obligation shall commence immediately upon the City’s selection of an applicant for a retail cannabis business permit.

4-35.9: Retail Cannabis Business Permit Term.

a. Subject to this Section 4-35.9 and Section 4-35.10, the term of each retail cannabis business permit shall be ten (10) years, unless the permit is revoked by the City for any reason authorized by this Chapter 4-35. Each permit may be extended for two additional City Council Regular Meeting - Page 382 of 421

21 years twice administratively by the City Manager. Permits that are extended twice administratively may request an extension of up to ten (10) years by application to the City Council. The process for requesting such extensions shall be approved by the City Council by resolution prior to the expiration of the initial ten (10) year term.

b. Upon the one (1) year anniversary of the date of issuance for each retail cannabis business permits and each year thereafter, the City Manager shall conduct a performance review of the permittee to assess compliance with the requirements of this Chapter 4-35.

Within thirty (30) days of the conclusion of the annual performance review of the permittee, the City Manager shall issue a letter of compliance or noncompliance outlining all items to be c orrected to ensure full compliance. In the event of any noncompliance, the permittee shall have sixty (60) days to remedy such noncompliance. However, in the event such noncompliance items cannot be remedied within sixty (60) days, such noncompliance items shall not constitute a material violation of any law and/or any rule, regulation, and/or standard adopted pursuant to this Chapter 4-35 subject to suspension or revocation under Section 4-35.10 if the permittee commences correction of such noncompliance items within sixty (60) days and thereafter diligently prosecutes correction of such noncompliance items to completion. The City Manager shall have the final discretion and authority to determine whether a permittee is working diligently to correct all noncompliance items in a timely manner.

c. The permittee shall pay a non-refundable fee in an amount to be set by the City Council via resolution to cover the costs of conducting the performance review, together with any costs incurred by the City to administer the program created under this Chapter 4-35.

4-35.10: Suspension and Revocation of Retail Cannabis Business Permits.

a. The City Manager may suspend or revoke a retail cannabis business permit at any time for any material violation of any law and/or any rule, regulation, and/or standard adopted pursuant to this Chapter 4-35.

b. Suspension or revocation of a State license issued by the State or by any of its departments or divisions, corresponding to the retail cannabis business permit shall immediately result in the suspension of the associated retail cannabis business permit until the State, or its applicable department or division, reinstates the State license or otherwise lifts such suspension.

c. A permittee shall inform the City Manager or designee(s) of any suspension, revocation, or termination of a State license corresponding to its retail cannabis business permit within five (5) business days of the suspension, revocation, or termination of the State license.

4-35.11: Appeals Regarding Retail Cannabis Business Permits.

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22 a. Within ten (10) calendar days after the date of a decision of the City Manager to revoke or suspend an issued retail cannabis business permit, deny a change in location application, or deny a change in ownership application, an aggrieved Party may appeal such action to the City Council by filing a written appeal with the City Clerk setting forth the reasons why the decision was not proper. An appeal shall stay all proceedings in furtherance of the appealed action.

b. At the time of filing, the appellant shall pay the designated, non-refundable appeal fee established by resolution of the City Council.

c. Upon receipt of the written appeal, the City Clerk shall set the matter for a hearing before the City Council. The City Council shall hear the matter de novo and shall conduct the hearing pursuant to the procedures set forth by the City.

d. The appeal shall be held within a reasonable time after filing the appeal, but in no event later than ninety (90) days from the date of such filing. The City shall notify the appellant of the time and location at least ten (10) days prior to the date of the hearing.

e. At the hearing, the appellant may present any information they deem relevant to the decision appealed. The formal rules of evidence and procedure applicable in a court of law shall not apply to the hearing.

f. At the conclusion of t he hearing, the City Council may affirm, reverse , or modify the decision appealed. The decision of the City Council shall be a final administrative decision, subject to judicial review and remedies.

4-35.12: Change in Location; Updated Application Information.

a. A permittee may change the business location specified in a retail cannabis business permit upon submission and approval of a change in location application promulgated, as a ministerial duty, by the City Manager pursuant to regulations adopted under Section 4-35.22. The permittee shall pay a non-refundable application fee established by resolution of the City Council to cover all costs incurred by the City in the review and processing of change in location applications. Upon submission of a change in location application by a permittee, the City Manager shall, as a ministerial duty, complete processing of such change in location application. If a change in location application is incomplete or the proposed changed location contained therein does not comply with location and zoning requirements in Section 4-35.6 and this Section, the City Manager shall, as a ministerial duty, deny the change in location application. If a change in location application is complete and the proposed changed location contained therein complies with location and zoning requirements in Section 4-35.6 and this Section , the City Manager shall, in his or her sole discre tion, approve or deny the change in location application. In the event the City Manager denies a change in location application, the City Council Regular Meeting - Page 384 of 421

23 permittee may appeal the City Manager’s denial to the City Council pursuant to Section 4-35.11.

b. In addition to the location and zoning requirements in Section 4-35.6, a permittee may not change the business location specified in a retail cannabis business permit to any property located one -thousand (1,000) feet or less from any cannabis retailer permitted under this Chapter 4-35. The distance specified in this Subsection b. shall be the horizontal distance measured in a straight line from the parcel line of the cannabis retailer permitted under this Chapter 4-35 to the closest parcel line of the lot on which the cannabis retailer is proposed to be located without regard to intervening structures.

c. An applicant or permittee shall notify the City Manager or designee(s) within fifteen (15) calendar days of any material change in the information provided in the applicant or permittee’s retail cannabis business permit application or any change in status of compliance with the provisions of this Chapter 4-35, including any change in the cannabis retailer ownership or management.

4-35.13: Transfer of a Retail Cannabis Business Permit.

a. An owner of a retail cannabis business permit shall not transfer ownership or control of such permit to another person unless and until the permittee and transferee(s) obtain an amendment to the permit from the City Manager stating that the transferee (s) is now an owner of the permittee. A permittee may change the ownership specified in a retail cannabis business permit upon submission of a change in ownership application promulgated, as a ministerial duty, by the City Manager pursuant to regulations adopted under Section 4-35.22 within one-hundred eighty (180) days following the effective date of this Chapter 4-35. The permittee shall pay a non-refundable application fee established by resolution of the City Council to cover all costs incurred by the City in the review and processing of change in ownership applications. Upon submission of a change in ownership application by a permittee, the City Manager shall, as a ministerial duty, complete processing of such change in ownership application . If a change in ownership application is incomplete or the proposed transferee(s) contained therein do not pass the background check(s) required under this Chapter 4-35, the City Manager shall, as a ministerial duty, deny the change in ownership application. If the cumulative (i.e., including the change in ownership of the permittee from previous change in ownership applications) change in ownership of the permittee is less than twenty-five and one-tenth (25.1) percent from the ownership percentages contained in the permittee’s original retail cannabis business permit application and the proposed transferee(s) contained therein pass the background check(s) required un der this Chapter 4-35, the City Manager shall, as a ministerial duty, approve the change in ownership application.

If the cumulative (i.e., including the change in ownership of the permittee from previous change in ownership applications) change in owners hip of the permittee is twenty -five and one-tenth (25.1) percent or more and less than fifty (50) percent, the City Manager shall, in his or her sole discretion, approve or deny the change in ownership application.

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24 In the event the City Manager denies a c hange in ownership application, the permittee may appeal the City Manager’s denial to the City Council pursuant to Section 4-35.11. If the cumulative ( i.e., including the change in ownership of the permittee from previous change in ownership applications) change in ownership of the permittee is fifty (5 0) percent or more from the ownership percentages contained in the permittee’s original retail cannabis business permit application and the proposed transferee(s) contained therein pass the background check(s) required under this Chapter 4-35, the City Manager shall, as a ministerial duty, schedule a public hearing before the City Council within thirty (30) days of completed processing, and following the public hearing, the City Council shall, in its sole discretion, approve or deny the change in ownership application.

b. Notwithstanding Subsection (a), n o retail cannabis business permit may be transferred when the City Manager has notified the permittee that its retail cannabis business permit has been or may be suspended or revoked.

c. Any attempt to transfer a retail cannabis business permit either directly or indirectly in violation of this Section 4-35.13 is hereby declared void, and such a n unpermitted transfer shall be deemed a ground for revocation of the permit.

4-35.14: Records and recordkeeping.

a. Each cannabis retailer shall maintain accurate books and records in an electronic format, which detail all revenues and expenses of the business, including, but not limited to, all of its assets and liabilities. On no less than an annual basis (at the time of performance review of a retail cannabis business permit issued pursuant to this Chapter 4-35), or at any time upon reasonable request of the City, each cannabis retailer shall file a sworn statement detailing the number of sales by the cannabis retailer during the previous 3-month period (or shorter period based upon the timing of the request) detailing sales for each month within such period in question. The statement shall also include gross sales for each month and all applicable taxes paid or due to be paid. On an annual basis, each cannabis retailer shall submit to the City a financial audit of the business ’s operations conducted by an independent certified public accountant. The City may perform its own annual independent financial audit and char ge the retailer for such cost incurred by the City. Each permittee shall be subject to a regulatory compliance review and financial audit as determined by the City Manager.

b. Each cannabis retailer shall maintain a current register of the names and t he contact information (including the name, address, and telephone number) of anyone owning or holding an interest in the cannabis retailer and, separately, the same contact information of all officers, managers, employees, agents, and volunteers currently employed or otherwise engaged by the cannabis retailer. The register required by this Subsection shall be provided to the City Manager upon a reasonable request.

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25 c. Each cannabis retailer shall maintain a record of all purchases and sales of cannabis and cannabis products for a period of no less than seven (7) years.

d. All cannabis retailers shall maintain an inventory control and reporting system that accurately documents the present location, amounts, and descriptions of all cannabis and cannabis products.

e. Subject to any applicable restrictions under the Health Insurance Portability & Accountability Act ( “HIPAA”) regulations, each cannabis retailer shall grant the City Manager access to the business’s books, records, accounts, together with any other data or documents relevant to its operation, for the purpose of conducting an audit or examination. Books, records, accounts, and any and all relevant data or documents shall be produced no later than ten (10) business days after receipt of the City Manager’s request for such data, unless otherwise stipulated by the City Manager. The City Manager may require the materials to be submitted in an electronic format that is compatible with the City’s software and hardware.

4-35.15: Security Measures.

a. A cannabis retailer shall implement sufficient security measures to deter and prevent the unauthorized entrance into areas containing cannabis or cannabis products and to deter and prevent the theft of cannabis or cannabis products at the cannabis retailer. Except as may otherwise be determined by the City Manager, these security measures shall include, but are not limited to the following:

1. Preventing individuals from remaining on the premises of the cannabis retailer if they are not engaging in an act ivity directly related to the permitted operations of the cannabis retailer.

2. Establishing limited access areas accessible only to authorized cannabis retailer personnel.

3. All cannabis and cannabis products shall be stored in a secured and locked room, safe, or vault. All cannabis and cannabis products shall be kept in a manner designed to prevent diversion, theft, and loss.

4. Installing twenty -four-hour security surveillance cameras of at least HD - quality to monitor all entrances and exits to and from the premises, all interior spaces within the cannabis retailer , which are open and accessible to the public, all interior spaces where cannabis, cash or currency is being stored for any period of time on a regular basis, and all interior spaces where diversion of cannabis could reasonably occur.

The cannabis retailer shall be responsible for ensuring that the security surveillance camera's footage is remotely accessible by the City Manager, and that it is compatible with the City's software and hardware . Video recordings shall be maintained for a City Council Regular Meeting - Page 387 of 421

26 minimum of ninety (90) days and shall be made available to the City Manager upon request. Video shall be of sufficient quality for effective prosecution of any crime found to have occurred on the site of the cannabis retailer.

5. Sensors shall be installed to detect entry and exit from all secure areas.

6. Panic buttons shall be installed in all cannabis retailers.

7. Having a professionally installed, maintained, and monitored alarm system.

8. Any bars installed on the windows or the doors of the cannabis retailer shall be installed only on the interior of the building.

9. The premises shal l be live monitored twenty-four (24) hours a day unless the cannabis retailer has an alternative security program authorized by the City Manager.

Security personnel must be licensed by the State Bureau of Security & Investigative Services personnel and shall be subject to the prior review and approval of the City Manager, which shall not be unreasonably withheld.

10. Additional security measures may be added through the review of a retail cannabis business permit application.

b. Each cannabis retailer shall identify a designated security representative or liaison to the City, who shall be reasonably available to meet with the City Manager regarding any security related measures and/or operational issues.

c. Each cannabis retailer (including as part of the retail cannabis business permit application process) shall have a storage and transportation plan and currency management plan, which describes in detail the procedures for safely and securely storing, disposing and transporting all cannabis, cannabis products, and any currency.

d. The cannabis retailer shall cooperate with the City whenever the City Manager makes a request, upon reasonable notice to the cannabis retailer, to inspect or audit the effectiveness of any security plan or of any other requirement of this Chapter 4-35.

e. A cannabis retailer shall notify the City Manager within twenty-four (24) hours after discovering any of the following:

1. Significant discrepancies identified during inventory. The level of significance shall be determined by the regulations promulgated by the City Manager.

2. Diversion, theft, loss, or any criminal activity involving the cannabis retailer or any agent or employee of the cannabis retailer.

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27 3. The loss or unauthorized alteration of records related to cannabis and cannabis products or registering customers or employees and/or agents of the cannabis retailer.

4. Any other breach of security.

4-35.16: Restriction on Alcohol and Tobacco Sales.

No person shall cause or permit the sale, dispensing, or consumption of alcoholic beverages or tobacco on or about the premises of the cannabis retailer.

4-35.17: Fees and charges.

a. No person may commence or continue any cannabis retail sales in the City without timely paying in full all fees and charges required for the operation of a cannabis retail sales. Fees and charges associated with the operation of such activity shall be established by resolution of the City Council which may be amended from time to time.

b. All cannabis retailers authorized to operate under this Chapter 4-35 shall pay all sales, use, business and other applicable taxes, and all license, registration, and other fees required under federal, State, and local law. Each cannabis retailer shall cooperate with City with respect to any reasonable request to audit the cannabis retailer’ books and records for the purpose of verifying compliance with this Section 4-35.20, including, but not limited to, a verification of the amount of taxes required to be paid during any period.

4-35.18: General operating requirements.

a. Cannabis retailers may operate only during the hours specified in the retail cannabis business permit issued by the City and must comply with State law at all times.

b. Cannabis shall not be consumed on the premises of any cannabis retailer.

c. No cannabis or cannabis products or graphics depicting cannabis or cannabis products shall be visible from the exterior of any property issued a retail cannabis business permit or on any of the vehicles owned or used as part of the cannabis retailer.

No outdoor storage of cannabis or cannabis products is permitted at any time.

d. Each cannabis retailer shall have in place a point-of-sale or management inventory tracking system to track and report on all aspects of the cannabis retailer including, but not limited to, such matters as cannabis tracking, inventory data, gross sales (by weight and by sale), and other information which may be deemed necessary by the City. The cannabis retailer shall ensure that such information is compatible with the City’s record- keeping systems as well as the State Mandated Track and Trace requirements and systems. In addition, the system must have the capability to produce historical City Council Regular Meeting - Page 389 of 421

28 transactional data for review. Furthermore, any system selected must be a pproved and authorized by the City Manager prior to being used by a permittee.

e. All cannabis and cannabis products sold and/or distributed shall be cultivated, manufactured, and distributed by licensed facilities that maintain operations in full conformance with the State and local regulations. The packaging and labeling of cannabis and cannabis products shall comply at all times with State law.

f. There shall not be a physician located in any cannabis retailer at any time for the purpose of evaluating patients for the issuance of a medicinal cannabis recommendations.

g. Each cannabis retailer shall provide the City Manager with the name, telephone number (both land line and mobile, if available) of an on-site employee or owner to whom emergency notice can be provided at any hour of the day.

h. Signage and Notices.

1. In addition to the requirements otherwise set forth in this Section 4-35.18, business identification signage for a cannabis retailer shall conform to the requirements of the City Municipal Code, including, but not limited to, seeking the issuance of a City sign permit.

2. No signs placed on the premises of a cannabis retailer shall obstruct any entrance or exit to the building or any window.

3. Each entrance to a cannabis retailer shall be visibly posted with a clear and legible notice indicating that smoking, ingesting, or otherwise consuming cannabis on the premises, or in the areas adjacent to the premises, is prohibited.

4. The entrance to the cannabis retailer shall be clearly and legibly posted with a notice that no person under the age of twenty-one (21) years of age is permitted to enter upon the premises of the cannabis retailer , other than as lawful customers permitted under State law.

i. Other than as lawful customers permitted under State law in the case of retailers, individuals under the age of twenty-one (21) years shall not be allowed on the premises of a cannabis retailer and shall not be allowed to serve as a driver for a cannabis retailer.

It shall be unlawful and a violation of this Chapter 4-35 for any person to employ any person at a cannabis retailer who is not at least twenty-one (21) years of age.

j. Odor control devices and techniques shall be incorporated in all cannabis retailers to ensure that odors from cannabis are not detectable off -site. Cannabis retailers shall provide a sufficient odor absorbing ventilation and exhaust system so that odor generated City Council Regular Meeting - Page 390 of 421

29 inside the cannabis retailer that is distinctive to its operation is not detected outside of the facility, anywhere on adjacent property or public rights-of-way, on or about the exterior or interior common area walkways, hallways, breezeways, foyers, lobby areas, or any other areas available for use by common tenants or the visiting public , or within any other unit located inside the same building as the cannabis retailer.

k. The original copy of the retail cannabis business permit issued by the City pursuant to this Chapter 4-35 and the City issued business license shall be posted inside the cannabis retailer in a location readily visible to the public.

l. Pursuant to Sections 11105(b)(11) and 13300(b)(11) of the State Penal Code, which authorizes City authorities to access State and local summary criminal history information for employment, licensing, or certification purposes; and authorizes access to federal level criminal history information by transmitting fingerprint images and related information to the Department of Justice to be transmitted to the Federal Bureau of Investigation, every person listed as an owner, manager, supervisor, employee , or volunteer of the cannabis retailer must submit fingerprints and other information deemed necessary by the City Manager for a backgroun d check. Pursuant to Sections 11105(b)(11) and 13300(b)(11) of the State Penal Code, which requires that there be a requirement or exclusion from employment, licensing , or certification based on specific criminal conduct on the part of the subject of the record, no person shall be issued a retail cannabis business permit unless they have first cleared the background check, as determined by the City Manager, as required by this Chapter 4-35. A non-refundable fee for the cost of the background investigation , which shall be the actual cost to the City to conduct the background investigation as it deems necessary and appropriate, shall be paid at the time the application for a retail cannabis business permit is submitted.

m. The cannabis retailer shall prohibit loitering by persons outside the facility both on the premises and within fifty (50) feet of the premises.

n. Within sixty (60) days of licensure, for a permittee with twenty (20) or more employees, the permittee shall attest to the City that the permittee has entered into a Labor Peace Agreement and will abide by the terms of the Agreement. The permittee shall submit a copy of the page of the Labor Peace A greement that contains the signatures of the labor repres entative and the applicant. For permittees with less than twenty (20) employees who have not yet entered into a Labor Peace A greement, the permittee shall provide a notarized statement indicating that the applicant will enter into and abide by the terms o f a Labor Peace Agreement within thirty ( 30) days after employing twenty (20) employees. If an attestation that the permittee is party to a Labor Peace Agreement, and a copy of the page of the Labor Peace Agreement that contains the signatures of the labor representative was submitted to the City by the permittee as part of the application process, that will meet this obligation.

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30 o. Cannabis retailers shall implement a workforce plan that includes at least the following provisions:

1. Commitment for thirty (30) percent of employees to be local hires; this local hiring requirement is satisfied when a cannabis retailer shows that it has either hired or made a good faith effort to hire bona fide residents of the City or persons that may establish residency after initial employment with the permittee;

2. Commitment to offer apprenticeships and/or compensation for continuing education in the field of cannabis retail sales; and

3. Paying a living wage to employees. “Living wage” means compensation equivalent to $20 per hour inclusive of benefits but excluding tips.

p. It shall be unlawful for a cannabis retailer to discriminate in any manner or take adverse action against any employee in retaliation for exercising rights protected under this Chapter 4-35 or City or State law. These rights include, but are not limited to (1) the right to file a complaint or inform any person about any party’s alleged noncompliance with this Chapter 4-35 or City or State law and (2) the right to inform any person of his or her potential rights under this this Chapter 4-35 or City or State law and to assist him or her in asserting such rights. Protections under this this Chapter 4-35 or City or State law shall apply to any employee who mistakenly, but in good faith, alleges noncompliance with this this Chapter 4-35 or City or State law. Taking adverse action against an employee within ninety (90) days of the employee’s exercise of rights protected under this Chapter 4-35 or City or State law shall raise a rebuttable presumption of having done so in retaliation for the exercise of such rights.

4-35.19: Additional Operational Requirements in General.

The City Manager may, pursuant to Section 4-35.22, develop additional cannabis retailer operational requirements or regulations for the retail sale of cannabis and cannabis products in the City as are determined to be necessary to protect the public health, safety, and welfare.

4-35.20: Additional Operating Requirements.

a. Retailers and the operation thereof shall comply with State law at all times.

b. Prior to dispensing medicinal cannabis or medicinal cannabis products to a qualified patient, a retailer shall verify the age and all necessary documentation of each customer to ensure the customer is not under the age of eighteen (18) years and obtain verification from the recommending physician that the person requesting medicinal cannabis or medicinal cannabis products is a qualified patient, and shall maintain a copy of the physician recommendation or identification card as described in Sections 11362.71 City Council Regular Meeting - Page 392 of 421

31 through 11362.77 of State Health & Safety Code, as may be amended from time to time, on site for period of not less than seven (7) years.

c. Prior to dispensing cannabis or cannabis products to an adult -use customer, a retailer shall verify the age and all necessary documentation of each customer to ensure the customer is not under the age of twenty-one (21) years.

d. All restroom facilities shall remain locked and under the control of managers onsite.

e. A retailer shall notify customers (verbally or by written agreement) and by posting of a notice or notices conspicuously in at least 15-point type within the permitted premises that state as follows:

1. “The sale or diversion of cannabis or cannabis products without a license issued by the City of Lynwood is a violation of State law and the Lynwood Municipal Code.”

2. “Secondary sale, barter, or distribution of cannabis or cannabis products purchased from a permittee is a crime and can lead to arrest."

3. “Customers must not loiter in or near these premises and may not consume cannabis or cannabis products in the vicinity of this business or in any place not lawfully permitted. These premises and vicinity are monitored to ensure compliance."

4. “WARNING: The use of cannabis or cannabis products may impair a person's ability to drive a motor vehicle or operate heavy machinery.”

5. “CALIFORNIA PROP. 65 WARNING: Smoking of cannabis and cannabis- derived products will expose you and those in your immediate vicinity to cannabis smoke. Cannabis smoke is known by the State of California to cause cancer and reproductive harm.”

4-35.21: Additional Operating Requirements For Delivery.

a. Delivery shall comply with State law at all times.

b. Security plans developed pursuant to this Chapter 4-35 shall include provisions relating to vehicle security and the protection of employees and product during loading and in transit.

c. A retailer shall facilitate the delivery of cannabis or cannabis products with a technology platform owned by or licensed to the delivery-only retailer that uses point-of- sale technology to track and database technology to record and store the following City Council Regular Meeting - Page 393 of 421

32 information for each transaction involving the exchange of cannabis or cannabis products between the retailer and customer:

1. The identity of the individual dispensing cannabis or cannabis products on behalf of the permittee;

2. The identity of the customer receiving cannabis or cannabis products from the permittee;

3. The type and quantity of cannabis or cannabis products dispensed and received;

4. The gross receipts charged by the permittee and received by the individual dispensing cannabis or cannabis products on behalf of the permittee for the cannabis or cannabis products dispensed and received; and

5. The location or address where the sale or retail sale took place or closed.

d. A permittee shall maintain a database and provide a list of the individuals and vehicles authorized to conduct delivery, and a copy of the valid State driver’s license issued to the driver of any such vehicle on behalf of the retailer to the City Manager.

e. Individuals making deliveries of cannabis or cannabis products on behalf of the retailer shall maintain a physical copy of the delivery request (and invoice) and shall make it available upon the request of agents or employees of the City requesting documentation.

f. During delivery, a copy of the permittee’s retail cannabis business permit and State license shall be in the vehicle at all times, and the driver shall make it available upon the request of agents or employees of the City requesting documentation.

g. A retailer shall only permit or allow delivery of cannabis or cannabis products in a vehicle that is ( 1) insured at or above the legal requirement in the State; ( 2) capable of securing (locking) the cannabis or cannabis products during transportati on; (3) capable of being temperature controlled if perishable cannabis or cannabis products is being transported; and (4) does not display advertising or symbols visible from the exterior of the vehicle that suggest the vehicle is used for cannabis deliver y or affiliated with a retailer.

h. A retailer shall facilitate deliveries with a technology platform owned by or licensed to the retailer that uses global positioning system technology to track, and database technology to record and store the following information:

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33 1. The time that the individual conducting delivery on behalf of the retailer departed the licensed premises.

2. The time that the individual conducting delivery on behalf of the retailer completed delivery to the customer.

3. The time that the individual conducting delivery on behalf of the retailer returned to the licensed premises.

4. The route the individual conducting delivery on behalf of the retailer traveled between departing and returning to the licensed premises to conduct delivery.

5. For each individual delivery transaction, the identity of the individual conducting deliveries on behalf of the retailer.

6. For each individual delivery transaction, the vehicle used to conduct delivery on behalf of the retailer.

7. For each individual delivery transaction, the identity of the customer receiving cannabis or cannabis products from the retailer.

8. For each individual delivery transaction, the type and quantity of cannabis or cannabis products dispensed and received.

9. For each individual delivery transaction, the gross receipts charged by the retailer and received by the individual conducting deliveries on behalf of the retailer for the cannabis or cannabis products dispensed and received.

i. The individual making deliveries on behalf of the retailer shall personally verify for each individual delivery transaction the identity of the customer receiving cannabis or cannabis products from the retailer and (1) for medicinal cannabis or medicinal cannabis products to a qualified patient, the age and all necessary documentation of each customer to ensure the customer is not under the age of eighteen (18) years and obtain verification from the recommending physician that the person requesting medicinal cannabis or medicinal cannabis products is a qualified patient, and shall maintain a copy of the physician recommendation or identification card as described in Sections 11362.71 through 11362.77 of State Health & Safety Code, as may be amended from time to time, on site for period of not less than seven (7) years or (2) for cannabis or cannabis products to an adult -use customer, age and all necessary documentation of each customer to ensure the customer is not under the age of twenty-one (21) years.

j. Within one-hundred-eighty (180) days following the effective date of this Chapter, commercial cannabis businesses conducting delivery pursuant to Chapter 4-34 of the City Municipal Code shall comply with the requirements of this Section 4-35.21.

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34 4-35.22: Promulgation of Regulations, Standards, and Other Legal Duties.

a. Consistently with stated requirements of this Chapter 4-35 (and in particular not to repeal or constructively repeal this Chapter 4-35), in addition to any regulations adopted under State law, the City Manager is authorized to establish any additional rules, regulations, and standards governing the issuance, denial , or renewal of retail cannabis business permits, the ongoing operation of cannabis retailers, and the City’s oversight, or concerning any oth er subject determined to be necessary to carry out the purposes of this Chapter 4-35.

b. Such regulations shall be published on the City’s website.

c. Regulations promulgated by the City Manager shall become effective upon date of publication. Cannabis retailers shall be required to comply with all State and local laws and regulations, including but not limited to any rules, regulations or standards adopted by the City Manager.

4-35.23: Community Relations.

a. Each cannabis retailer shall provide the name, telephone number, and email address of a community relations contact to whom notice of problems associated with the cannabis retailer can be provided. Each cannabis retailer shall also provide the above information to all businesses and residences, in the City, located within one hundred and fifty (150) feet of the cannabis retailer. Such community relations contact shall respond to any complaints within forty-eight (48) hours of receipt of such complaints.

b. During the first year of operation pursuant to this Chapter 4-35, the owner (s), manager(s), and community relations representative from each cannabis retailer holding a retail cannabis business permit issued pursuant to this Chapter 4-35 shall attend a quarterly meeting with the City Manager and other interested parties as deemed appropriate by the City Manager, to discuss costs, benefits, and other community issues arising as a result of implementation of this Chapter 4-35. After the first year of operation, the owner(s), manager(s), and community relations representative from each such cannabis retailer shall meet with the City Manager when and as requested by the City Manager.

c. Cannabis retailers to which a retail cannabis business permit is issued pursuant to this Chapter 4-35 shall develop and make available to youth organizations and educational institutions a public education plan that outlines the risks of youth addiction to cannabis, and that identifies resources available to youth related to drugs and drug addiction.

4-35.24: Fees Deemed Debt To City.

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35 The amount of any fee, cost , or charge imposed pursuant to this Chapter 4-35 shall be deemed a debt to the City that is recoverable via authorized processes as set forth in the City Municipal Code or available through any court of competent jurisdiction.

4-35.25: Permittee, owner, and property owner responsible for violations.

a. Each permittee and each owner and each manager of the permittee (and each individual owner and each individual manager of an owner or manager of the permittee) shall be responsible for all violations of the laws of the State or of the regulations and/or the ordinances of the City occurring within the City or in or about the premises of the cannabis retailer, if committed by the permittee or any employee or agent of the permittee and whether or not said violations occur within the permittee, owner, or manager ’s presence.

b. No person may engage in any cannabis retail sales within the City unless the person is in compliance with the requirements of this Chapter 4-35.

c. It shall be unlawful to rent, lease, or otherwise permit any cannabis retail sales at any location, structure, or vehicle in the City by a person (1) that does not have a valid retail cannabis business permit issued by the City; (2) that does not have a valid State license; (3) that does not have any other applicable approvals, including, but not limited to, a building permit and City business license; or (4) that is not currently in compliance with all applicable State and local laws and regulati ons pertaining to the cannabis retail sales. Property owners shall have strict liability for any cannabis retail sales at any location, structure, or vehicle in the City by a person (1) that does not have a valid retail cannabis business permit issued by the City or (2) that does not have a valid State license.

4-35.26: Inspection and Enforcement.

a. The City Manager or designee(s) charged with enforcing the provisions of the City Municipal Code, or any provision thereof, may enter the location of a cannabis retailer at any time, without notice, and inspect the location of any cannabis retailer as well as any recordings and records required to be maintained pursuant to this Chapter 4-35 or under applicable provisions of State law.

b. It is unlawful for any person having responsibility over the operation of a cannabis retailer, to impede, obstruct, interfere with, or otherwise not to allow, the City to conduct an inspection, review or copy records, recordings, or other documents require d to be maintained by a cannabis retailer under this Chapter 4-35 or under State or local law. It is also unlawful for a person to conceal, destroy, deface, damage, or falsify any records, recordings or other documents required to be maintained by a cannabis retailer under this Chapter 4-35 or under State or local law.

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36 c. The City Manager or designee(s) charged with enforcing the provisions of this Chapter 4-35 may enter the location of a cannabis retailer at any time during business hours and without notice to obtain samples of the cannabis to test for public safety purposes. Any samples obtained by the City shall be logged, recorded, and maintained in accordance with the City law enforcement standards for evidence.

4-35.27: Concurrent Regulation with the State.

It is the stated intent of this Chapter 4-35 to regulate cannabis retail sales in the City concurrently with the State.

4-35.28: Violations Declared a Public Nuisance.

Each and every material violation of the provisions of this Chapter 4-35 is hereby deemed unlawful and a public nuisance subject to all remedies and enforcement measures authorized by the City Municipal Code.

4-35.29: Each Violation a Separate Offense.

Each and every violation of this Chapter 4-35 shall constitute a separate violation and shall be subject to all remedies and enforcement measures authorized by the City Municipal Code. Additionally, as a nuisance per se, any material violation of this Chapter 4-35 shall be subject to injunctive relief, any retail cannabis business permit issued pursuant to this Chapter 4-35 being deemed null and void, disgorgement , and payment to the City of any monies unlawfully obtained, costs of abatement, costs of investigation, attorney’s fees, and any other relief or remedy available at law or in equity. The City may also pursue any and all remedies and actions available and applicable under State and local laws for any violations committed by the cannabis retailer or persons related to, or associated with, the cannabis retail sales. Additionally, when there is determined to be an imminent threat to public health, safety or welfare, the City Manager or designee(s), may take immediate action to temporarily suspend a retail cannabis business permit issued by the City, pending a public hearing before the City Council.

4-35.30: Criminal Penalties.

Each and every material violation of the provisions of this Chapter 4-35 may be prosecuted as a misdemeanor and upon conviction be subject to a fine not to exceed five thousand dollars ($5,000.00) or imprisonment in the County jail for a period of not more than six (6) months, or by both such fine and imprisonment. Each day a material violation is committed or permitted to continue shall constitute a separate offense.

4-35.31: Remedies Cumulative and Not Exclusive.

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37 The remedies provided herein are not to be construed as exclusive remedies. The City is authorized to pursue any proceedings or remedies provided by law.

SECTION 5. Section 4 -34.1 (Purpose) of Chapter 4 (Licensing and Business Regulations) of the City Municipal Code is hereby amended to read as follows:

a. The purpose of this Section is to regulate all commercial cannabis activity in the City of Lynwood, as defined in Section 26001 of the California Business and Professions Code, to the extent authorized by state law and in a manner designed to minimize negative impact on the City, and to promote the health, safety, morals, and general welfare of residents and businesses within the City.

b. This Section is further adopted, established, and amended pursuant to the specific authority granted to the City of Lynwood in Section 7 of Article XI of the California Constitution and Division 10 of the California Business and Professions Code, commencing with Section 26000. These regulations shall govern all commercial cannabis activity that occurs within the jurisdiction of the City.

SECTION 6. Section 4-34.2 (Definitions) of Chapter 4 (Licensing and Business Regulations) of the City Municipal Code is hereby amended to read as follows:

n. Licensed premises means the premises, consisting of a single or immediately adjoining parcel(s) as identified by valid street address and assessor parcel number, specified in an application for a permit under this chapter, which are owned or in possession of the applicant or licensee and within which the applicant or licensee is applying for authorization to cultivate, manufacture, distribute, test, or is applying for multiple permitted uses within the same premises, in accordance with the provisions of this Chapter, the MAUCRSA, any development agreement approved by City Council, and any rules adopted pursuant thereto, except that no storefront dispensary, as specified in section 25-200-1, shall be permitted within the city.

SECTION 7. Section 4-34.2 (Definitions) of Chap ter 4 (Licensing and Business Regulations) of the City Municipal Code is hereby amended to read as follows:

t. Commercial cannabis business means any person engaged in commercial cannabis activity but excludes cannabis retailers permitted and operating under Chapter 4-35 of the City Municipal Code.

SECTION 8. Section 4-34.2 (Definitions) of Chapter 4 (Licensing and Business Regulations) of the City Municipal Code is hereby amended to read as follows:

City Council Regular Meeting - Page 399 of 421

38 y. Permit means authorization to conduct commercial cannabis activity operate a commercial cannabis business pursuant to this Chapter, state law, and upon the issuance of an occupancy permit and business license by the City.

SECTION 9. Section 4-34.4 (Permitted Use) of Chapter 4 (Licensing and Business Regulations) of the City Municipal Code is hereby amended to read as follows:

b. All persons who are engaged in operate or who are attempting to engage in commercial cannabis activity operate a commercial cannabis business in any form shall do so only in strict compliance with the terms, conditions, limitations and restrictions of the MAUCRSA, the provisions of this section, and all other applicable state and local laws and regulations.

SECTION 10. Section 4-34.6 (Permitted Zones – Distance and Other Conditions For Approval) of Chapter 4 (Licensing and Business Regulations) of the City Municipal Code is hereby amended to read as follows

e. Nonconforming Use. Any commercial cannabis business, dispensary of medical or adult use cannabis, or storefront cannabis retailer established or operating in the city in violation of this section or the ban established by Ordinance No. 1632, Section 25-200-1, and Chapter 25 Appendix A of the Lynwood Zoning Code shall not be considered a lawful or permitted nonconforming use, and no such commercial cannabis business shall be eligible for issuance of a commercial cannabis business permit. Further, any such unlawfully established commercial cannabis business shall constitute a public nuisance subject to abatement by the city, pursuant to section 3-13.

SECTION 11. Section 4 -34.8 (Changing, Altering, Or Modifying Location ) of Chapter 4 (Licensing and Business Regulations) of the City Municipal Code is hereby amended to read as follows

c. Application. The City Council or its designee may grant approval for the types of changes, alterations, or modifications described herein upon the filing of an application by the licensee, and payment of any applicable fee. The licensee must submit all information requested by the City Council or its designee including, but not limited to, documents that verify the following:

1. The licensee will continue to have exclusive possession of the premises, as changed, by ownership, lease, or rental agreement, and sole control of all production; and

2. The proposed change conforms to any and all City restrictions related to the time, manner, and place of regulation of the commercial cannabis activity commercial cannabis businesses.

City Council Regular Meeting - Page 400 of 421

39 SECTION 12. Sensitive Uses. The City Council finds that the definitions of the sensitive uses (day care center s, public parks, schools, and youth center s) under the amendment to Section 4-35.3 of the City Municipal Code in this Ordinance are subject to some degree of interpretation. However, the City Council also find s that certainty regarding the identification of sensitive uses (day care centers, public parks, schools, and youth centers) under the amendments to Sections 4-35.3 and 4-35.6 of the City Municipal Code in this Ordinance is required to carry out the purpose and intent of th is Ordinance so the that People, the City, and prospective applicant s can clearly identify where and where not lawful cannabis retailers under this Ordinance may be located. Accordingly and pursuant to the authority delegated by the State to the City Council under Section 26054(b) of the State Business & Professions Code and overriding the location and design requirements contained in Section 26054(b) of the State Business & Professions Code, the following sensitive uses ( day care centers, public parks, schoo ls, and youth centers) and only the following sensitive uses ( day care centers, public parks, schools, and youth centers ) located on the following County Assessor’s Identification Numbers and only the following County Assessor’s Identification Numbers shall be considered under the amendment to Section 4-35.6.a of the City Municipal Code in this Ordinance for the purpose of the initial establishment of cannabis retailers pursuant to the initial iteration of the cannabis retailer application procedure under the amendment to Section 4-35.7 of the City Municipal Code in this Ordinance (to include any review and scoring of any applications pursuant to the objective review criteria and quantitative evaluation scale under the amendment to Section 4-35.7.d of the City Municipal Code in this Ordinance).

Only following the initial iteration of the cannabis retailer application procedure and the initial issuance of retail cannabis business permit s under the amendment to Section 4-

35.7 of the City Municipal Code in this Ordinance, may the City Manager (his or her designee(s)) reinterpret the following list of sensitive uses (day care centers, public parks, schools, and youth centers ) and County Assessor’s Identification Numbers for the purpose of subsequent iterations of the cannabis retailer application procedure under the amendment to Section 4-35.7 of the City Municipal Code in this Ordinance and change in location applications under the amendment to Section 4-35.12 of the City Municipal Code in this Ordinance.

Name Sensitive Use
Type
County Assessor’s
Identification Number(s)
Abbott Preschool Day Care
Center 6186-042-900
Adolfo Medina Park Public Park
6169-014-905, 6169-016-
901, 6169-016-903, 6169-
016-907
B L Harvey School Day Care
Center 6191-011-012
Camphor Tree Park Public Park 6174-009-901
City Council Regular Meeting - Page 401 of 421

40 Name Sensitive Use
Type
County Assessor’s
Identification Number(s)
Carnation Park Public Park 6170-022-901
Cesar Chavez Middle School School
6191-018-900, 6191-018-
901, 6191-018-902, 6191-
018-903, 6191-018-904,
6191-018-907
Children's Institute / Imperial Courts Day Care
Center 6067-014-902
David's Heart Enrichment Center Day Care
Center 6177-007-001
Dr. Ralph Bunche Middle School School 6150-036-900
Ella Fitzgerald CDC / Drew Child
Development Corporation
Day Care
Center 6150-036-021
Faith and Hope Park Public Park 6150-020-900
Fernwood Avenue Park Project Public Park 6169-002-908
Foster Elementary School School 6184-009-900
Foster State Preschool Day Care
Center 6184-009-900
Fred W. Hosler Middle School School 6173-022-900
Helen Keller Elementary School
6177-001-919, 6177-001-
902, 6177-001-903, 6177-
001-904, 6177-001-906,
6177-001-907, 6177-001-
901, 6177-001-918, 6177-
001-912, 6177-001-917,
6177-001-915, 6177-001-
914, 6177-001-911, 6177-
001-905, 6177-001-916,
6177-001-908, 6177-001-
909, 6177-001-910, 6177-
001-913, 6177-001-920
Helen Keller Preschool Day Care
Center
6177-001-919, 6177-001-
902, 6177-001-903, 6177-
001-904, 6177-001-906,
6177-001-907, 6177-001-
901, 6177-001-918, 6177-
001-912, 6177-001-917,
6177-001-915, 6177-001-
914, 6177-001-911, 6177-
001-905, 6177-001-916,
6177-001-908, 6177-001-
City Council Regular Meeting - Page 402 of 421

41 Name Sensitive Use
Type
County Assessor’s
Identification Number(s)
909, 6177-001-910, 6177-
001-913, 6177-001-920
Henning Youth Center Youth Center 6173-007-901, 6173-007- 902
Hollydale Regional Park Public Park
6234-011-275, 6234-011-
007, 6234-011-804, 6234-
014-274, 6234-013-902,
6234-014-800, 6234-014-
901, 6234-014-803, 6234-
014-277, 6234-014-275,
6234-016-900, 6234-016-
803, 6234-016-802, 6234-
016-801, 6234-016-800,
6234-019-270, 6234-019-
006, 6234-019-902, 6234-
019-801, 6234-019-800,
6234-019-802, 6234-019-
903, 6234-019-803, 6236-
009-900, 6236-009-810,
6236-009-807, 6236-009-
808
Imperial Courts Recreation Center Youth Center 6067-013-901 Janie P. Abbott Elementary School School 6186-042-900
Jordan High School School 6046-021-918, 6046-020-
901
Kinder Prep Preschool Center Day Care
Center 6171-016-013
King State Preschool Day Care
Center 6150-025-901
Lincoln Elementary School School 6170-022-900, 6170-022- 902
Lincoln Preschool Day Care
Center
6170-022-900, 6170-022-
902
Lindbergh Children's Center Day Care
Center
6168-012-927, 6168-012-
926, 6168-012-902, 6168-
013-900, 6168-012-905
Lindbergh Elementary School School
6168-012-927, 6168-012-
926, 6168-012-902, 6168-
013-900, 6168-012-905
Lindbergh Preschool Day Care
Center
6168-012-927, 6168-012-
926, 6168-012-902, 6168-
013-900, 6168-012-905
City Council Regular Meeting - Page 403 of 421

42 Name Sensitive Use
Type
County Assessor’s
Identification Number(s)
Little Pillar Park Public Park 6170-014-901, 6170-014-
907
Los Amigos East Park Public Park 6168-012-906
Los Amigos West Park Public Park 6168-013-901, 6168-013- 902, 6168-012-905
Los Angeles Speech & Language
Therapy Center, Inc.

Day Care
Center 6173-015-041
Lucy Avalos Community Center Youth Center
6189-019-908, 6189-019-
923, 6189-019-916, 6189-
019-917, 6189-019-926
Lugo Elementary School School
6193-002-901, 6193-002-
904, 6193-002-902, 6193-
002-909, 6193-002-906,
6193-002-907, 6193-002-
903, 6193-002-905, 6193-
002-908
Lugo Preschool Day Care
Center
6193-002-901, 6193-002-
904, 6193-002-902, 6193-
002-909, 6193-002-906,
6193-002-907, 6193-002-
903, 6193-002-905, 6193-
002-908
Lynwood Community Center Youth Center 6173-022-901
Lynwood High School School 6174-020-900, 6174-019-
900
Lynwood Natatorium Youth Center 6173-021-900
Madison Elementary School School 6206-027-901
Marco Antonio Firebaugh High
School School
6189-032-900, 6189-023-
900, 6189-023-901, 6189-
023-902, 6189-023-903,
6189-023-904, 6189-023-
914, 6189-023-905, 6189-
023-906, 6189-023-915,
6189-023-907, 6189-023-
908, 6189-023-909, 6189-
023-916, 6189-023-910,
6189-023-911, 6189-023-
917, 6189-023-912, 6189-
023-913, 6189-032-903,
6189-032-904, 6189-032-
901, 6189-032-902, 6189-
City Council Regular Meeting - Page 404 of 421

43 Name Sensitive Use
Type
County Assessor’s
Identification Number(s)
032-905, 6189-032-906,
6189-032-909, 6189-032-
907, 6189-032-908
Mark Twain Elementary School School 6174-025-900
Mark Twain Preschool Day Care
Center 6174-025-900
Martin Luther King Elementary
School School 6150-025-901
Mona Park Public Park 6150-025-900, 6150-025-
902
Montara Avenue Elementary School School 6207-004-922, 6207-004- 923
Park Place Early Education Day Care
Center 6186-012-041
Pathway Independent Study School 6173-022-900
Ralph C. Dillis Park Public Park
6237-026-904, 6237-033-
914, 6237-033-904, 6237-
033-915, 6237-033-902,
6237-033-905, 6237-033-
911, 6237-033-913, 6237-
033-918, 6237-033-912,
6237-033-906, 6237-033-
907, 6237-033-916, 6237-
033-917, 6237-033-909,
6237-033-910, 6237-033-
901
Ricardo Lara Linear Park Public Park 6174-001-913
Ritter Elementary School School 6068-020-901
Roosevelt Elementary School School 6191-023-900, 6191-024- 900
Roosevelt Preschool Day Care
Center
6191-023-900, 6191-024-
900
Rosa Parks Elementary School
6174-019-905, 6174-019-
903, 6174-019-907, 6174-
019-904, 6174-019-906,
6174-019-908, 6174-019-
909, 6174-019-901, 6174-
019-902
Rosa Parks Preschool Day Care
Center
6174-019-905, 6174-019-
903, 6174-019-907, 6174-
019-904, 6174-019-906,
City Council Regular Meeting - Page 405 of 421

44 Name Sensitive Use
Type
County Assessor’s
Identification Number(s)
6174-019-908, 6174-019-
909, 6174-019-901, 6174-
019-902
Rose Park Public Park 6169-009-900
SAGA Child Development Learning
Academy
Day Care
Center 6173-030-012
San Miguel Catholic School School 6068-008-001, 6068-008- 031
Simon Rodia Continuation School School 6207-001-900, 6207-001- 901
Soleil Academy Charter School School 6174-020-900, 6174-019- 900
South East High School & Middle
School School 6207-001-900, 6207-001-
901
St. Emydius School School
6191-015-027, 6191-015-
021, 6191-015-024, 6191-
015-023
St. Philip Neri School School
6186-014-018, 6186-014-
004, 6186-014-016, 6186-
024-031
Sunshine Day Care Center Day Care
Center 6168-016-014
Thurgood Marshall Elementary
School School 6191-018-907, 6191-018-
905, 6191-018-906
Thurgood Marshall Preschool Day Care
Center
6191-018-907, 6191-018-
905, 6191-018-906
Tiny Treasures Preschool Day Care
Center 6168-008-003
Veterans Memorial Garden Public Park 6187-002-900
Victoria Elementary School School 6209-009-900, 6209-009- 902, 6209-009-901
Vista High School School 6194-031-906
Volunteers of America, Abbott Head
Start
Day Care
Center 6186-042-900
Volunteers of America, Bright Stars
Head Start
Day Care
Center
6173-003-005, 6173-003-
018
Volunteers of America, Greater
Emmanuel Head Start
Day Care
Center 6173-017-025
Volunteers of America, Happy Days
Head Start
Day Care
Center 6186-008-030
City Council Regular Meeting - Page 406 of 421

45 Name Sensitive Use
Type
County Assessor’s
Identification Number(s)
Washington Elementary School School 6190-012-901, 6193-017- 901
Washington Preschool Day Care
Center
6190-012-901, 6193-017-
901
Weigand Avenue Elementary School School 6066-009-900
Weigand Elementary School Room 6 Day Care
Center 6066-009-900
Will Rogers Children's Center Day Care
Center 6194-016-925
Will Rogers Elementary School School 6194-016-925
Will Rogers Preschool Day Care
Center 6194-016-925
Wilson Elementary School School 6175-008-900
Wilson Preschool Day Care
Center 6175-008-900
Wilson School Park Public Park 6175-006-900
Yvonne Burke-John D. Ham Park Public Park
6189-019-927, 6189-019-
929, 6189-019-928, 6189-
019-924, 6189-019-909,
6189-019-925, 6189-019-
921, 6189-019-911, 6189-
019-915, 6189-019-903,
6189-019-906, 6189-019-
907, 6189-019-904, 6189-
019-913, 6189-019-912,
6189-019-922, 6189-019-
918, 6189-019-910, 6189-
019-919, 6189-019-905,
6189-019-920, 6189-019-
914, 6186-036-912, 6186-
036-913, 6186-036-910,
6186-036-909, 6186-036-
905, 6186-036-906, 6186-
036-900, 6186-036-907,
6186-036-908, 6186-036-
902, 6186-036-901, 6186-
036-903

SECTION 13. Categorically Exempt from CEQA. The City Council find that the actions contemplated by th is Ordinance, including the issuance of retail cannabis business permits, are categorically exempt from the California Environmental Quality Act (“CEQA”) under Section 15060(c)(2) and Section 15060(c)(3) of Title 14 of the State Code City Council Regular Meeting - Page 407 of 421

46 of Regulations. Further, the City Council finds that pursuant to Section 4-35.06 of Chapter 4-35 of the City Municipal Code as codified by this Ordinance, cannabis retailers are a use permitted in certain zoning districts within the City. As permitted in those zoning districts, cannabis retailers are similar to already existing permitted general uses in those zoning districts with the only difference being the type of product being delivered or sold.

SECTION 14. Severability. If any provision, section, paragraph, sentence, phrase, or word of th is Ordinance is rendered or declared invalid, illegal, or unconstitutional by any final action in a court of competent jurisdiction or by reason or any preemptive legislation, such unconstitutionality illegality or invalidity shall only affec t such provision, section, paragraph, sentence, phrase, or word and shall not affect or impair any remaining provisions, sections, paragraphs, sentences, phrases, or words, or the application of this Ordinance to any other person or circumstance, and to th at end, the provisions hereof are severable. It is hereby declared to be the intention of the City Council that that this Ordinance would have been adopted had such unconstitutional illegal or invalid provision, section, paragraph, sentence, phrase, or word not been included herein.

SECTION 15. Liberal Construction. This Ordinance is an exercise of the police power of the City Council to provide for safe and regulated access to cannabis and cannabis products, and shall be liberally construed to effectuate that purpose.

PASSED, APPROVED, AND ADOPTED at a regular meeting of the City Council of the City of Lynwood, California this ____ day of August 2022.

_______________________
Jorge Casanova, Mayor

ATTEST:

____________________________
Maria Quinonez, City Clerk

APPROVED AS TO FORM

____________________________
Noel Tapia, City Attorney

City Council Regular Meeting - Page 408 of 421
Agenda Item # 25.

AGENDA STAFF REPORT
DATE:

August 2, 2022

TO:

Honorable Mayor and Members of the City Council

APPROVED BY:

Ernie Hernandez, City Manager

PREPARED BY:

Ernie Hernandez, City Manager

SUBJECT:

AWARD OF CONTRACT AND APPROVAL TO SEQUEL CONTRACTOR, INC. FOR THE STONEACRE AVE IMPROVEMENT PROJECT BETWEEN CARLIN AVE AND MCMILLAN ST FY 2022-2023 PROJECT NO. 4011.68.111
Recommendation:

Staff recommends that the City Council adopt the attached resolution entitled: “A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD AWARDING A CONTRACT TO SEQUEL CONTRACTOR, inc. AS THE LOWEST RESPONSIBLE BIDDER, IN THE AMOUNT OF $579,508.00 FOR THE STONEACRE AVE IMPROVEMENT PROJECT BETWEEN CARLIN AVE AND MCMILLAN ST FY 2022-2023 PROJECT NO. 4011.68.111.”

Background:

On October 12, 2021, the City of Compton’s City Council approved a cost sharing agreement with the City of Lynwood based on proportional share of 49% for the City of Lynwood and 51% for the City of Compton for the streets of Stoneacre Avenue from Carlin Avenue to McMillan Street and on McMillan Street from Stoneacre Avenue to Atlantic Avenue. The two street segments are separated into two separate projects.

On March 15, 2022, the City of Lynwood’s City Council approved the cost sharing cooperative agreement authorizing the city manager to enter a cost sharing cooperative agreement with the City of Compton for

the streets of Stoneacre Avenue from Carlin Avenue to
McMillan Street and on McMillan Street from Stoneacre Avenue to Atlantic Avenue.

The Council item for consideration pertains to award of construction for street improvements along Stoneacre Avenue from Carlin Avenue to McMillan Street. The Project consists of street resurfacing, and partial replacement of concrete sidewalks, curb and gutters, driveway approaches, curb ramps, traffic signage and striping.

Discussion and Analysis:

On June 28, 2022, the Notice Inviting Bids (NIB) was advertised on the City’s web site (PlanetBids). The Bid opening took place in the PlanetBids Platform on Monday, July 18, 2022, at 10:30 am (PST).

The following four (4) bids were received:

Bidder
Bid

1. Sequel Contractor, Inc.
$579,508.00

2. Sully-Miller Contracting Company
$652,250.00

3. All American Asphalt
$757,503.00

4. Hardy & Harper, Inc.
$770,000.00

An analysis of all bidders was conducted, including a review of their bid schedule, license, references, and federal documents. Sequel City Council Regular Meeting - Page 409 of 421
An analysis of all bidders was conducted, including a review of their bid schedule, license, references, and federal documents. Sequel Contractor, Inc. was the apparent lowest responsible bidder with a low base bid of $579,508.00. The bidder’s previous performance reveals that the contractor has the necessary experience and contractor’s license for this type of project.

It is estimated that this project will take approximately thirty (30) working days to complete the work set forth in the specifications. Upon authorization, staff will circulate the contract documents, set up a pre-construction meeting, and schedule work to commence.

Bid Items and Cost
:

STONEACRE AVE IMPROVEMENTS PROJECT BETWEEN cARLIN aVE AND mCmILLAN sT fY 2022-2023 Amount
Bid Schedule
Mobilization/ Demobilization (Not to exceed 3% of total of all other prime Contract Bid Items) $15,000.00
Traffic Control
$54,000.00
Sawcut, Remove and Construct Concrete Sidewalk (4" Thick) $5,152.00
Sawcut, Remove and Construct Concrete Curb and Gutter
$74,700.00
Sawcut, Remove and Construct Concrete Curb Ramp
$12,000.00
Sawcut, Remove and Construct Concrete Driveway Approach (6" Thick) $4,100.00
Remove and Construct Curb Drain
$2,000.00
Prune Tree Roots and Install Root Barriers
$3,000.00
Sawcut and Remove Existing AC Pavement, Base, and Subgrade $141,470.00
Provide and Place Crushed Aggregate Base CAB
$81,374.00
Construct AC Leveling Course (1" Thick)
$39,650.00
Construct ARHM Overlay (3" Thick)
$121,562.00
Adjust Existing Storm Drain/ Sewer/ Utility Manhole Frames and Covers to Finished Grade $8,000.00
Adjust Existing Water Valve Can and Cover to Finished Grade $3,000.00
Remove and Replace Existing Post and Sign with Diamond Grade Sheeting $500.00
Traffic Striping, Marking, Curb Painting, House Addresses, and Signs $10,000.00
Install Public Improvement Project Signs
$4,000.00
Total Proposed Cost
$579,508.00

Fiscal Impact:

No additional appropriation is needed. Total project cost is estimated as follows:

Stoneacre Improvements

Hard costs (Construction, plus 10%
contingency)
$637,459
Soft Costs (Design, Construction
Management, Inspection, Labor
Compliance)
$115,902

$753,361

Coordinated With:

City Manager’s Office
Department of Finance and Administration Services
ATTACHMENTS:

Description

RESOLUTION
City Council Regular Meeting - Page 410 of 421
1 RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD AWARDING A CONTRACT TO SEQUEL CONTRATOR, INC. AS THE
LOWEST RESPONSIBLE BIDDER, IN THE AMOUNT OF $579,508.00 FOR

THE STONEACRE AVE IMPROVEMENT PROJECT BETWEEN CARLIN
AVE AND MCMILLAN ST FY 2022 -2023 PROJECT NO.4011.68.111 ; AUTHORIZING THE MAYOR TO EXECUTE THE AGREEMENT.

WHEREAS, the City of Lynwood will implement a cost sharing cooperative agreement with the City of Compton; and

WHEREAS, STONEACRE AVE IMPROVEMENT PROJECT BETWEEN CARLIN AVE AND MCMILLAN ST FY 2022 -2023 (“Project”) encompasses the following street segment: Stoneacre Ave between Carlin Ave and McMillan St; and

WHEREAS, the Project consists of consists of street resurfacing, and partial replacement of concrete sidewalks, curb and gutters, driveway approaches, curb ramps, traffic signage, and striping; and

WHEREAS, on June 28 , 2022, the Notice Inviting Bids for the Project was advertised on the City’s web site (PlanetBids); and

WHEREAS, the bid opening took place in the PlanetBids Platform on July 18, 2022, at 10:30 A.M. (Pacific Time); and
WHEREAS, staff received four (4) bid proposals; and

WHEREAS, Sequel Contractor, Inc. is the lowest responsible bidder; and

WHEREAS, to move forward with this Project, appropriation is needed.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY FIND, PROCLAIM, ORDER, AND RESOLVE AS FOLLOWS:

Section 1. The City Council of the City of Lynwood authorizes the Mayor to execute the agreement between the City of Lynwood and Sequel Contractor, Inc. for the Stoneacre Ave Improvement Project between Carlin Ave and McMillan St FY 2022-2023 (“Project”) in the amount of $579,508.00.

Section 2. No additional appropriation is needed.

Total project cost is estimated as follows:

Stoneacre Improvements

Hard costs (Construction, plus
10% contingency)
$637,459
City Council Regular Meeting - Page 411 of 421
2 Soft Costs 2 (Design, Construction
Management, Inspection, Labor
Compliance)
$115,902
$753,361

Section 3. The City Council of the City of Lynwood authorizes the City Manager under LMC 6-3.15(d) to exceed the specific dollar amounts or percentage limitations under LMC 6-3.15(a) and authorizes the City Manager to approve consultant, vendor agreements, modifications, change orders or agreement amendments related to the Project up to the available Project Budget.

Section 4. This resolution shall take effect immediately upon its adoption.

Section 5. The City Clerk shall certify to the adoption of this resolution and hereafter the same shall be in full force and effect.

(Signatures on Next Page)
City Council Regular Meeting - Page 412 of 421
3 PASSED, APPROVED and ADOPTED this 2nd day of August 2022.

Jorge Casanova
Mayor

ATTEST:

Maria Quinonez Ernie Hernandez
City Clerk City Manager

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

Noel Tapia Ernie Hernandez
City Attorney Interim Director of Public Works
City Council Regular Meeting - Page 413 of 421
4 STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, do hereby certify that the foregoing Resolution was passed and adopted by the City Council of the City of Lynwood at a regular meeting held on the 2nd day of August 2022, and passed by the following votes:

AYES:

NOES:

ABSTAIN:

ABSENT:

Maria Quinonez, City Clerk

STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, and the Clerk of the City Council of said City, do hereby certify that the above foregoing is a full, true, and correct copy of Resolution No. on file in my office and that said Resolution was adopted on the date and by the vote therein stated. Dated this 2nd day of August 2022.

Maria Quinonez, City Clerk
City Council Regular Meeting - Page 414 of 421
Agenda Item # 26.

AGENDA STAFF REPORT
DATE:

August 2, 2022

TO:

Honorable Mayor and Members of the City Council

APPROVED BY:

Ernie Hernandez, City Manager

PREPARED BY:

Ernie Hernandez, City Manager

SUBJECT:

AWARD OF CONTRACT AND APPROVAL TO PAVEMENT COATINGS CO. FOR THE CITYWIDE SLURRY SEAL (PHASE 2) PROJECT FY 2022-2023.

Recommendation:

STAFF RECOMMENDS THAT THE CITY COUNCIL ADOPT THE ATTACHED RESOLUTION ENTITLED:
“A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD AWARDING A CONTRACT TO PAVEMENT COATINGS CO. AS THE LOWEST RESPONSIBLE BIDDER, IN THE AMOUNT OF $299,931.10 FOR THE CITYWIDE SLURRY SEAL (PHASE 2) PROJECT FY 2022-2023; AUTHORIZING THE MAYOR TO EXECUTE THE AGREEMENT; AND APPROVING AN APPROPRIATION OF $389,924.21 [KA1] FROM THE UNAPPROPRIATED MEASURE M BONDS (FUND 2357) TO THE PROJECT.”

Background:

The City of Lynwood is implementing a citywide slurry seal program. The item before the City Council will continue that slurry seal program into Phase 2 of this four-phase program. Slurry seal projects are an important part of the city’s pavement management program. The treatment provides a new wearing surface of the road and protects it from sun and water damage. A slurry seal is a maintenance treatment that prolongs the life of asphalt at a fraction of the cost of full pavement (structural) repair.

The work encompassed by the Citywide Slurry Seal (PHASE 2) FY 2022-2023 (“Project”) is more specifically defined in the contract documents, but in general consists of, but is not limited to: citywide slurry seal, including pavement cold milling and overlay at the following locations:

Street Name
From
To
Santa Fe Ave
Cedar Ave
Banning Ave
Bellinger St
Lynwood Rd
Butler Ave
Carlin Ave
Alpine Ave
Oak St
Carlin Ave
Oak St
Long Beach Blvd
Carlin Ave
Long Beach Blvd
Bullis Rd
City Council Regular Meeting - Page 415 of 421
Carlin Ave
Bradfield Ave
Muriel Dr
Carlin Ave
Thorson Ave
Harris Ave
Carlin Ave
Castle Gate Ave
Stone Acre Ave
Cedar Ave
State St
Peach St
Cedar Ave
Alpine Ave
Long Beach Blvd
Cedar Ave
Long Beach Blvd
School St
Cedar Ave
School St
Bullis Rd
El Segundo Blvd
Santa Fe Ave
Peach St
El Segundo Blvd
Peach St
Alpine
First Ave
Josephine St
CDS
Flower St
Peach St
Lindbergh Ave
Magnolia Ave
Alpine Ave
Long Beach Blvd
McMillan St
Cookacre Ave
Atlantic Ave
Muriel Dr
Carlin Ave
Palm Ave
Niland St
EOP
Second Ave
Oak St
Euclid Ave
Orchard Ave
Philadelphia Way
Alameda Ave
Philadelphia Way
Peach St
Carlin Ave
Euclid Ave
Plum St
Redwood Ave
EOP
Third Ave
Josephine St
Agnes Ave
Virginia St
Long Beach Blvd
School St
Discussion and Analysis:

On June 28, 2022, the Notice Inviting Bids (NIB) was advertised on the City’s web site (PlanetBids). The Bid opening took place in the PlanetBids Platform on Monday, July 18, 2022, at 10:00 am (PST).

The following five (5) bids were received:

Bidder
Bid

1. Pavement Coatings Co
$299,931.10

2. American Asphalt South, Inc.
$308,861.14

3. Roy Allan Slurry Seal, Inc.
$325,499.98

4. Doug Martin Contracting
Company, Inc.
$346,299.24

5. All American Asphalt
$492,182.50

An analysis of all bidders was conducted, including a review of their bid schedule, license, references, and federal documents. Pavement Coatings Co was the apparent lowest responsible bidder with a low base bid of $299,931.10. The bidder’s previous performance reveals that the contractor has the necessary experience and contractor’s license for this type of project.

It is estimated that this project will take approximately thirty (30) working days to complete the work set forth in the specifications. Upon authorization, staff will circulate the contract documents, set up a pre-construction meeting, and schedule work to commence.

Bid Items and Construction Budget
:

CITYWIDE SLURRY SEAL (PHASE 2) PROJECT FY 2022-202
Amount
Bid Schedule
Mobilization/ Demobilization (Not to exceed 3% of total of all other prime Contract Bid Items) $8,000.00
Traffic Control
$59,150.00
Cold Mill Existing AC Pavement (2” Deep)
$5,621.10
Construct 2" Thick AC (C2-PG 64-10)
$12,710.00
City Council Regular Meeting - Page 416 of 421
Place Slurry Seal Type II with 3% Latex
$170,100.00
Install Crack Seal and Spray Weed Killer
and Spray Weed Killer
$1,450.00
Adjust Existing Storm Drain/Sewer/Utility Manhole Frames and Covers to Finished Grade $3,700.00
Adjust Water Valve Can and Cover to Finished Grade
$5,500.00
Remove and Replace Existing Thermoplastic Striping, Legends, Arrows and Parking Stalls $31,100.00
Furnish and Install Public Improvement Project Sign
$2,600.00
Total Proposed Construction Cost
$299,931.10

Hard Cost – 10% Contingency
$29,993.11
Soft Costs – Design, Construction Management, Inspection, Labor Compliance
$60,000.00
Total Budget for Slurry Seal Phase 2
$389,924.21

Fiscal Impact:

The proposed project requires appropriation in the amount of $389,921.21 from Measure M Bonds.

Bond funds
dedicated to future fiscal year projects will need to be adjusted; to include, amendment of the five-year CIP.

Coordinated With:

City Manager’s Office
ATTACHMENTS:

Description

RESOLUTION
City Council Regular Meeting - Page 417 of 421
1 RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD AWARDING A CONTRACT TO PAVEMENT COATINGS CO . AS THE
LOWEST RESPONSIBLE BIDDER, IN THE AMOUNT OF $299,931.10 FOR THE CITYWIDE SLURRY SEAL (PHASE 2) PROJECT FY 202 2-2023; AUTHORIZING THE MAYOR TO EXECUTE THE AGREEMENT; AND
APPROVING AN APPROPR IATION OF $389,924.21 FROM THE
UNAPPROPRIATED MEASU RE M BONDS (FUND 235 7) TO THE
PROJECT.

WHEREAS, the City of Lynwood will implement a citywide slurry seal program in four phases; and

WHEREAS, CITYWIDE SLURRY SEAL (PHASE 2) PROJECT FY 202 2-2023 (“Project”) encompasses the following street segments of 1.) Santa Fe Ave from Cedar Ave to Banning Ave 2.) Bellinger St from Lynwood Rd to Butler Ave 3.) Carlin Ave from Alpine Ave to Long Beach Blvd 4.) Carlin from Long Beach Blvd to Bullis Rd 5.) Carlin from Bradfield Ave to Muriel Dr 6.) Carlin Ave from Thorson Ave to Harris Ave 7.) Carlin Ave from Castle Gate Ave to Stone Acre Ave 8.) Cedar Ave from State St to Peach St 9.) Cedar Ave from Alpine Ave to Long Beach Blvd 10.) Cedar from Long Beach Blvd to Bullis Rd 11.) El Segundo Blvd from Santa Fe Ave to Alpine Ave 12.) First Ave from Josephine St to CDS 13.) Flower St from Peach St to Lindbergh Ave 14.) Magnolia Ave from Alpine Ave to Long Beach Blvd 15.) McMillan St from Cookacre Ave to Atlantic Ave 16.) Muriel Dr from Carlin Ave to Palm Ave 17.) Niland St from EOP to Second Ave 18.) Oak St from Euclid Ave to Orchard Ave 19.) Philadelphia Way from Alameda Ave to Philadelphia Way

20.) Peach St from Carlin Ave to Euclid Ave 21.) Plumb St from Redwood Ave to EOP

22.) Third Ave from Josephine St to Agnes Ave 23.) Virginia St from Long Beach Blvd to School St ; and

WHEREAS, the Project consists of citywide slurry seal, including pavement cold milling and overlay at some locations; and

WHEREAS, on June 28 , 2022, the Notice Inviting Bids for the Project was advertised on the City’s web site (PlanetBids); and

WHEREAS, the bid opening took place in the PlanetBids Platform on July 18, 2022, at 10:00 A.M. (Pacific Time); and
WHEREAS, staff received five (5) bid proposals; and

WHEREAS, Pavement Coatings Co. is the lowest responsible bidder; and

WHEREAS, to move forward with this Project, appropriation is needed.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY FIND, PROCLAIM, ORDER, AND RESOLVE AS FOLLOWS:

City Council Regular Meeting - Page 418 of 421
1 Section 1. The City Council of the City of Lynwood authorizes the Mayor to execute the agreement between the City of Lynwood and Pavement Coatings Co . for the Citywide Slurry Seal (Phase 2) Project FY 2022-2023 (“Project”) in the amount of $299,931.10.

Section 2. The City Council approves the following appropriation:

Appropriation (FY__)
Fund Dept Div Object Description Amount
Budgetary Transfer Out
2357 Measure M Bonds

Budgetary Transfer In

Section 3. The City Council of the City of Lynwood authorizes the City Manager under LMC 6-3.15(d) to exceed the specific dollar amounts or percentage limitations under LMC 6-3.15(a) and authorizes the City Manager to approve consultant, vendor agreements, modifications, change orders or agreement amendments related to the Project up to the available Project Budget.

Section 4. This resolution shall take effect immediately upon its adoption.

Section 5. The City Clerk shall certify to the adoption of this resolution and hereafter the same shall be in full force and effect.

(Signatures on Next Page)
City Council Regular Meeting - Page 419 of 421
3 PASSED, APPROVED and ADOPTED this 2nd day of August 2022.

Jorge Casanova
Mayor

ATTEST:

Maria Quinonez Ernie Hernandez
City Clerk City Manager

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

Noel Tapia Ernie Hernandez
City Attorney Interim Director of Public Works
City Council Regular Meeting - Page 420 of 421
4 STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, do hereby certify that the foregoing Resolution was passed and adopted by the City Council of the City of Lynwood at a regular meeting held on the 2nd day of August 2022, and passed by the following votes:

AYES:

NOES:

ABSTAIN:

ABSENT:

Maria Quinonez, City Clerk

STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, and the Clerk of the City Council of said City, do hereby certify that the above foregoing is a full, true, and correct copy of Resolution No. on file in my office and that said Resolution was adopted on the date and by the vote therein stated. Dated this 2ndday of August 2022.

Maria Quinonez, City Clerk
City Council Regular Meeting - Page 421 of 421