1202 3rd St DA final — Santa Monica City Council, December 16, 2025

Recording Requested By:

City of Santa Monica
When Recorded Mail To:

City of Santa Monica
Santa Monica City Attorney's Office
1685 Main Street, Third Floor
Santa Monica, CA 90401
Attention: City Attorney
_______________________________________________________________________ Space Above Line For Recorder's Use
No Recording Fee Required
California Government Code Section 27383

DEVELOPMENT AGREEMENT

BETWEEN

CITY OF SANTA MONICA,
AND

UNITED XYZ LLC

FOR A DIGITAL DISPLAY
AT 1202 THIRD STREET PROMENADE
__________________, 2026
i

TABLE OF CONTENTS
RECITALS ..................................................................................................................................1 ARTICLE 1 DEFINITIONS ............................................................................................................5 ARTICLE 2 DESCRIPTION OF THE DIGITAL DISPLAY .........................................................8

2.1 General Description ..........................................................................................................8

2.2 Principal Components of the Digital Display ...................................................................8

2.3 No Obligation to Develop .................................................................................................8

2.4 Vested Rights ....................................................................................................................9

2.5 Project and Community Benefits ....................................................................................10

2.6 Maintenance and Upgrades .............................................................................................19

2.7 Removal of Digital Display ............................................................................................19

2.8 Projection, Design, and Operation Standards .................................................................19

2.9 Coastal Commission Review ..........................................................................................20 ARTICLE 3 CONSTRUCTION ....................................................................................................20

3.1 [Reserved.] ......................................................................................................................20

3.2 Construction Hours .........................................................................................................20

3.3 Outside Building Permit Issuance Date ..........................................................................20

3.4 Construction Period ........................................................................................................21

3.5 Extended Vested Rights ..................................................................................................21

3.6 Existing Building Repairs, Remodeling, Reconstruction or Redevelopment and/or Digital Display Damage .............................................................................................................22

3.7 City Termination Option .................................................................................................22 ARTICLE 4 FEES, EXACTIONS, AND CONDITIONS .............................................................23

4.1 Fees, Exactions, and Conditions .....................................................................................23

4.2 Conditions on Modifications...........................................................................................23

4.3 Implementation of Conditions of Approval ....................................................................23 ARTICLE 5 EFFECT OF AGREEMENT ON CITY LAWS AND REGULATIONS ................23

5.1 Development Standards for the Digital Display; Existing Regulations ..........................23

5.2 Permitted Subsequent Code Changes .............................................................................24

5.3 Common Set of Existing Regulations .............................................................................26

5.4 Conflicting Enactments ...................................................................................................26

5.5 Timing of Development ..................................................................................................26 ii
ARTICLE 6 DESIGN APPROVAL ..............................................................................................26 ARTICLE 7 CITY TECHNICAL PERMITS ................................................................................26

7.1 Definitions.......................................................................................................................26

7.2 Diligent Action by City ...................................................................................................27

7.3 Conditions for Diligent Action by the City .....................................................................27

7.4 Duration of Technical City Permits ................................................................................28 ARTICLE 8 AMENDMENT AND MODIFICATION .................................................................29

8.1 Amendment and Modification of Development Agreement ..........................................29 ARTICLE 9 TERM ........................................................................................................................29

9.1 Effective Date .................................................................................................................29

9.2 Term ................................................................................................................................29 ARTICLE 10 PERIODIC REVIEW OF COMPLIANCE .............................................................30

10.1 City Review ....................................................................................................................30

10.2 Evidence of Reasonable Good Faith Compliance ..........................................................30

10.3 Information to be Provided to Owner .............................................................................30

10.4 Notice of Breach; Cure Rights ........................................................................................31

10.5 Failure of Periodic Review .............................................................................................31

10.6 Termination of Development Agreement .......................................................................31

10.7 City Cost Recovery .........................................................................................................31 ARTICLE 11 DEFAULT...............................................................................................................31

11.1 Notice and Cure ..............................................................................................................31

11.2 Remedies for Monetary Default ......................................................................................32

11.3 Remedies for Non-Monetary Default .............................................................................32

11.4 Modification or Termination of Agreement by City .......................................................34

11.5 Cessation of Rights and Obligations ...............................................................................35

11.6 Completion of Improvements .........................................................................................35 ARTICLE 12 MORTGAGEES .....................................................................................................35

12.1 Encumbrances on the Property .......................................................................................35 ARTICLE 13 TRANSFERS AND ASSIGNMENTS ..................................................................37

13.1 Transfers and Assignments. ............................................................................................37

13.2 Release Upon Transfer ....................................................................................................38 ARTICLE 14 INDEMNITY TO CITY .........................................................................................38

14.1 Indemnity ........................................................................................................................38

14.2 City’s Right to Defense ...................................................................................................38 iii
ARTICLE 15 GENERAL PROVISIONS......................................................................................39

15.1 Notices ............................................................................................................................39

15.2 Entire Agreement; Conflicts ...........................................................................................39

15.3 Binding Effect .................................................................................................................40

15.4 Agreement Not for Benefit of Third Parties ...................................................................40

15.5 No Partnership or Joint Venture .....................................................................................40

15.6 Estoppel Certificates .......................................................................................................40

15.7 Time ................................................................................................................................41

15.8 Excusable Delays ............................................................................................................41

15.9 Governing Law ...............................................................................................................42

15.10 Cooperation in Event of Legal Challenge to Agreement ................................................42

15.11 Attorneys’ Fees ...............................................................................................................42

15.12 Recordation .....................................................................................................................42

15.13 No Waiver .......................................................................................................................42

15.14 Construction of this Agreement ......................................................................................42

15.15 Other Governmental Approvals ......................................................................................43

15.16 Jurisdiction and Venue. ...................................................................................................44

15.17 Exhibits ...........................................................................................................................44

15.18 Counterpart Signatures ....................................................................................................44

15.19 Certificate of Performance ..............................................................................................44

15.20 Interests of Owner ...........................................................................................................44

15.21 Operating Memoranda ....................................................................................................45

15.22 Acknowledgments, Agreements and Assurance on the Part of Owner ..........................45

15.23 Waiver of Protest ............................................................................................................45

15.24 Not a Public Dedication ..................................................................................................46

15.25 Other Agreements ...........................................................................................................46

15.26 Severability and Termination ..........................................................................................46 Exhibit “A” Legal Description of Property
Exhibit “B” Digital Display Plans
Exhibit “C” SMMC Article 9 (Planning and Zoning)
Exhibit “D” Conditions of Approval
Exhibit “E” Permitted Fees and Exactions
Exhibit “F” Form of Assignment and Assumption Agreement Exhibit “G” Digital Display District Ordinance
1 DEVELOPMENT AGREEMENT
This Development Agreement (“Agreement”), dated ____________, 2026, is entered into by and between UNITED XYZ LLC, a California limited liability company (the “Owner”) and the CITY OF SANTA MONICA, a municipal corporation organized and existing pursuant to the laws of the State of California and the Charter of the City of Santa Monica (the “City”), with reference to the following facts:

RECITALS
A. Pursuant to California Government Code Section 65864 et seq. and Chapter 9.60 of the Santa Monica Municipal Code (collectively, the “Development Agreement Statutes”), the City is authorized to enter into binding development agreements with persons or entities having a legal or equitable interest in real property for the development of such real property.

B. Owner is the owner of approximately 14,990 square feet of land located in the City of Santa Monica, State of California, commonly known as 1202 Third Street Promenade, as more particularly described in Exhibit “A” attached hereto and incorporated herein by this reference (the “Property”).

C. The Property is developed with an existing approximately 44,949 square foot commercial building that is occupied with commercial (fitness/gym) uses (the “Existing Building”).

D. The City has included the Property within the Downtown Core land use designation under the City’s 2010 Land Use and Circulation Element of its General Plan (the “LUCE”). The Property is in the Bayside Conservation “BC” (Promenade) District under the Downtown Community Plan (“DCP”) and is located within the Bayside Conservation “BC” (Third Street Promenade Area) designation under the City’s Zoning Ordinance, and is located within the boundaries of the Digital Display District. The Property is also located in the California Coastal Zone.

E. On May 12, 2008, the Santa Monica Landmarks Commission designated the Existing Building as a City Landmark and the Property as a Landmark Parcel. (08-LM-005.) F. The City and Owner desire to allow Owner to install, operate, maintain, and repair a high-quality LED digital display and associated sign structure (the “Digital Display”) on the Existing Building for displaying paid static or full motion on-premises and/or off-premises advertising, artistic creations, civic announcements of public interest or importance and content promoting the City and/or its rich history, including Downtown Santa Monica and the Third Street Promenade. The operation of the Digital Display will generate revenues for the City through the Community Benefit Payment set forth in this Agreement.

G. Owner has advised the City of Owner’s intent to allow a third party billboard operator to operate and own, lease, or license the Digital Display from Owner during the term of this Agreement.
2 H. On January 30, 2025, Owner filed an application for a Development Agreement (25ENT-0021), pursuant to Santa Monica Municipal Code (“SMMC”) Section 9.60.020 (the “Development Application”). The Development Application proposes an approximately one thousand (1,000) square foot full motion, animated Digital Display to be installed under guidance by a Qualified Historic Preservation Professional to wrap around the corner of the east and north facades of the Existing Building above the first floor. In addition, consistent with one of the building’s character defining features the Development Application includes reactivation of the Existing Building’s unused blade sign to once again identify the commercial tenant operating within the Existing Building.

I. The design of the Digital Display and reactivated blade sign is more particularly depicted on the Digital Display Plans dated November 18, 2025 and attached hereto as Exhibit “B” (the “Digital Display Plans”).

J. Prior to filing the Development Application, a Qualified Historic Preservation Professional (as defined in Article 1 of this Agreement) was retained by the applicant team to advise it with respect to the location/positioning and design of the Digital Display. Subsequent to filing the Development Application, City also retained a Qualified Historic Preservation Professional to advise it with respect to the location/positioning and design of the Digital Display.

K. Prior and subsequent to filing the Development Application, Owner held a virtual community meeting and also held meetings with community members and stakeholders, including various preservation advocates, regarding the Digital Display.

L. Owner has paid all necessary costs and fees associated with the City’s processing of the Development Application and this Agreement.

M. The primary purpose is to allow for a Digital Display on the Property to (1) create a visually stimulating and informative experience at the corner of Wilshire Boulevard and the 1200 block of the Promenade; (2) promote the City, including the Third Street Promenade, and the arts, attract visitors and patrons to the Promenade; (3) complement the City’s Entertainment District; as well as (4) generate a new source of revenue for the City, while at the same time respecting and embracing the prominence of the Existing Building, a City-designated Landmark, including its fluted tower that was originally capped with JCP signage. The Parties desire to enter into this Agreement in conformance with the Development Agreement Statutes in order to achieve the development of the Digital Display on the Property.

N. The Digital Display is also consistent with and implements numerous LUCE, DCP, and Historic Preservation Element goals and policies including:
 LUCE Goal D1 - “Maintain Downtown’s competitive advantage as a premier local and regional shopping, dining, and entertainment destination, and support its evolution in order to respond to changing market conditions.” 3  LUCE Goal E1 - “Create an economic base that satisfies the commercial service needs of the City’s residents while providing employment opportunities and a strong fiscal infrastructure for the City.”
 LUCE Goal E4 - “Support the retail sector in order to provide for the needs of local residents and visitors and augment sales tax revenues.”  LUCE Policy E1.1 – “Make land use decisions that respond to changing market conditions and meet the needs of City residents and visitors.”  LUCE Goal HP 1 - “Preserve and protect historic resources in Santa Monica through the land use decision-making process.”
 LUCE Policy HP 1.3 - “Ensure that new development, alterations or remodeling on, or adjacent to, historic properties are sensitive to historic resources and are compatible with the surrounding historic context.”
 LUCE Goal HP 2 - “Preserve and protect historic resources through the development of economic incentives and neighborhood conservation approaches.”  LUCE Policy E4.6 - “Support Downtown as Santa Monica’s primary destination for comparison retail, including a mix of local, national and international shops and restaurants that serve residents, visitors and area employees.”  DCP Goal CCP2 - “Downtown continues to be a thriving and diverse economic force that supports the city’s vitality, fiscal stability and high levels of community services.”
 Goal CCP5: The Third Street Promenade continues to anchor the Downtown’s retail and public space experience with updated features and activities.  Policy CCP5.1 New public art should be encouraged and located to enhance the pedestrian experience and create an immersive arts experience.  Action CCP5.1A Install Pathway Art, Banners and Urban Design Features to support the walking experience and to promote awareness of Downtown’s cultural offerings.
 Policy CCP5.2 Consider opportunity for negotiated development agreement art contributions to be aggregated in order to facilitate the acquisition of significant public art pieces.
 DCP Goal LU3 - “Santa Monica’s Downtown continues to be the economic center for the City, providing a diverse and flexible mix of uses that can meet future resident, business and visitor demand.”
4  “The Bayside Conservation district is considered the pedestrian and economic heart of the City. Anchored by the Third Street Promenade, it is a vibrant urban atmosphere supported by a broad mix of building types, office space, entertainment, retail, restaurants, cafes, salons and exercise studios. The DCP supports the continued expansion of the central retail district by increasing the energy and pedestrian traffic on streets around the Promenade.” (DCP p. 22-23.)  Historic Preservation Element Goal 3 – “Increase public awareness of the history of Santa Monica and historic preservation in the City.”
 Historic Preservation Element Objective 3.2 – “Promote the benefits of owning historic property.”
 Historic Preservation Element Objective 3.8 – “Encourage the installation of plaques and/or public art related to historic buildings and sites in the City.”  Historic Preservation Element Policy 3.8.3 – “Investigate the possibility of coordinating historic preservation and public art programming.”  Historic Preservation Element Policy 4.1.3 – “Allow for appropriate additions to and adaptive reuse of historic resources.”
 Historic Preservation Element Goal 5 – “Promote the preservation of historic and cultural resources through incentives and technical assistance.”  Historic Preservation Element Objective 5.2 – “Promote and award incentives.” O. The City Council has determined that a development agreement is appropriate for the proposed development of the Digital Display on the Property. This Agreement will (1) eliminate uncertainty in planning for the Digital Display and result in the orderly development of the Digital Display in accordance with the Digital Display District Ordinance, (2) assure installation of necessary improvements on the Property, (3) provide for public infrastructure and services appropriate to development of the Digital Display, (4) secure for the City improvements that benefit the public, (5) ensure the provision of community benefits as envisioned in the LUCE, DCP, and the Digital Display District Ordinance, and (6) otherwise achieve the goals and purposes for which the Development Agreement Statutes were enacted.

P. This Agreement is consistent with the public health, safety, and welfare needs of the residents of the City and the surrounding region. The City has specifically considered and approved the impacts and benefits of the development of the Digital Display on the Property in accordance with this Agreement. The Digital Display will provide a number of significant project and community benefits as set forth in Section 2.5 of this Agreement. 5 Q. The City Council has found that the provisions of this Agreement are consistent with the relevant provisions of the City’s General Plan, including the LUCE, the DCP, the Digital Display District Ordinance, and the 1992 LUP.

R. On October 29, 2025, the City's Planning Commission held a duly noticed public hearing on the Development Application and this Agreement, and at such hearing, the Planning Commission recommended that the City Council approve the Digital Display including this Agreement.

S. On December 16, 2025, the City Council held a duly noticed public hearing on the updated Development Application and this Agreement, and at such hearing the City determined the Digital Display is exempt from the California Environmental Quality Act (“CEQA”) pursuant to a Class 1 exemption (existing facilities) per CEQA Guidelines Section 15301, a Class 3 exemption (new construction or conversion of small structures) per CEQA Guidelines Section 15303, a Class 11 exemption (accessory structures) per CEQA Guidelines Section 15311, a Class 31 exemption (historical resource restoration/rehabilitation), and a Class 32 categorial exemption (in-fill development) per CEQA Guidelines Section 15332 and introduced for first reading Ordinance No. _______________ approving this Agreement.

T. On ___________, 2026 the City Council adopted Ordinance No. _______________ approving this Agreement.

NOW THEREFORE, in consideration for the covenants and conditions hereinafter set forth, the Parties hereto do hereby agree as follows:

ARTICLE 1

DEFINITIONS
Capitalized terms not defined below shall have the meanings set forth in the City’s Zoning Ordinance. The terms defined below, whether capitalized or not, have the meanings in this Agreement as set forth below unless the Agreement expressly requires otherwise:

1.1 “1992 LUP” means the Coastal Land Use Plan in effect as of the Effective Date unless otherwise indicated in this Agreement.

1.2 “Agreement” means this Development Agreement.

1.3 “Annual Gross Revenues” means Gross Revenues received in a calendar year.

1.4 “Building Permit” means any permit required by SMMC Section 8.08.050(a) and any successors thereto.

1.5 “Business Day” means a business working day for City Employees.

1.6 “Calendar Quarter” means the periods between and including (a) January 1st and March 31st, (b) April 1st and June 30th, (c) July 1st and September 30th, and (d) October 1st and December 31st of any calendar year.
6 1.7 “City Council” means the City Council of the City of Santa Monica, or its designee.

1.8 “City Manager” means the City Manager or his or her designee.

1.9 “Community Development Director” means the Community Development Department Director of the City of Santa Monica, or his or her designee.

1.10 “Days” means calendar days.

1.11 “DCP” has the meaning set forth in Recital “D”.

1.12 “Digital” means of, relating to, or utilizing devices constructed or working by the methods or principles of electronics. “Digital” also means composed of data in the form of especially binary digits.

1.13 “Digital Display” means a display utilizing digital technology with a display face to broadcast a message containing static or animated content, for on and off-premises advertising, including without limitation the Digital Display referenced in Recital “F”.

1.14 “Digital Advertising Services” means advertisement services on the Digital Display, including advertisements in the form of banner advertising, search engine advertising, interstitial advertising, and other comparable advertising services.

1.15 “Digital Display District Ordinance” means Ordinance No. ___________, adopted by the City Council on _________, 2026 and included in Exhibit “G”.

1.16 “Digital Display District” means the Digital Display District identified in the Digital Billboard District Ordinance.

1.17 “Digital Display Commencement Date” means the date a Certificate of Occupancy or final building permit signoff, as applicable, for the Digital Display is/has been issued.

1.18 “Digital Display Plans” mean the plans for the Digital Display that are attached to this Agreement as Exhibit “B”.

1.19 “Discretionary Approvals” are actions which require the exercise of judgment or a discretionary decision, and which contemplate and authorize the imposition of revisions or additional conditions, by the City, including any board, commission, or department of the City and any officer or employee of the City. Discretionary Approvals do not include Ministerial Approvals.

1.20 “Effective Date” has the meaning set forth in Section 9.1 below.

1.21 “General Plan” or “City General Plan” means the General Plan of the City of Santa Monica, and all elements thereof including the LUCE, as of the Effective Date, unless otherwise indicated in this Agreement.
7 1.22 “Gross Revenues” means income or revenue generated by the Digital Display from all sources, before any expenses (including lease or license payments to Owner) or taxes, computed according to generally accepted accounting principles.

1.23 “Including” means “including but not limited to.”

1.24 “Legal Action” means any action in law or equity.

1.25 “Ministerial Approvals” mean any action which merely requires the City (including any board, commission, or department of the City and any officer or employee of the City), in the process of approving or disapproving a permit or other entitlement, to determine whether there has been compliance with applicable statutes, ordinances, regulations, or conditions of approval. Without limiting the generality of the foregoing, the exercise of duties and/or professional judgment by any City official referenced in SMMC Article 7 (Public Works) and Article 8 (Building Regulations), as amended from time to time, shall be considered a Ministerial Approval.

1.26 “Operator” means the party responsible for operating the Digital Display.

1.27 “Owner” means UNITED XYZ LLC, a California limited liability company or any successor in interest to the Property.

1.28 “Parties” mean both the City and Owner, and “Party” means either the City or Owner, as applicable.

1.29 “Permitted Digital Display Area” means no more than one thousand (1,000) square feet.

1.30 “Person” means an individual, partnership, limited partnership, trust, estate, association, corporation, limited liability company, or other entity, domestic or foreign.

1.31 “Qualified Historic Preservation Professional” means an architectural historian and/or historic architect with at least seven (7) years of relevant experience who satisfies The Secretary of the Interior’s Professional Qualification Standards for History, Architectural History, and/or Architecture pursuant to 36 CFR part 61.

1.32 “SMMC” means the Santa Monica Municipal Code, including the Zoning Ordinance, in effect on the Effective Date unless specifically stated to refer to the Santa Monica Municipal Code as it may be in effect at some other time.

1.33 “Transfer” means the transfer of title to property by the execution of the deed or other instrument.

1.34 “Zoning Ordinance” means the City of Santa Monica Comprehensive Land Use and Zoning Ordinance (Chapters 9.01 to 9.68 of the SMMC) in effect on the Effective Date, set forth in its entirety as part of Exhibit “C” (Planning and Zoning). 8 ARTICLE 2

DESCRIPTION OF THE DIGITAL DISPLAY

2.1 General Description. The Digital Display includes the proposed improvement of the Property as more particularly described in this Agreement and on the Digital Display Plans, which present the Digital Display in concept. If there is a conflict or inconsistency between the text of this Agreement and the Digital Display Plans, the Digital Display Plans will prevail; provided, however, that omissions from the Digital Display Plans shall not constitute a conflict or inconsistency with the text of this Agreement. Detailed plans and specifications for the construction of the Digital Display (collectively, the “Construction Plans and Specifications”), including, without limitation, structural plans and working drawings, shall be prepared by Owner subsequent to the Effective Date based upon the Digital Display Plans, and nothing herein shall be interpreted by the Owner as a pre-approval of the Construction Plans and Specifications by the City Building Official or City Engineer.

2.2 Principal Components of the Digital Display. The Digital Display consists of the following principal components, as well as the other components delineated in the Digital Display Plans, all of which are hereby approved by the City subject to the other provisions of this Agreement: an approximately one thousand (1,000) square foot full motion, LED digital/animated display/billboard to be anchored to the roof and suspended over the façade of the Existing Building as shown on the Digital Display Plans. The Digital Display may display static or full motion animated illuminated/digital content seven Days per week including paid onpremises and/or off-premises advertising, public service content, artwork, civic announcements, charitable content and, as detailed in Section 2.5, content promoting the City and/or its rich history, including Downtown Santa Monica (such as the walking tours provided by the Santa Monica Conservancy) and the Third Street Promenade, and other City content. The Digital Display may display such illuminated/digital content during the hours specified in the Digital Display District Ordinance.

2.3 No Obligation to Develop.

2.3.1 Except as specifically provided herein:
(a) Nothing in this Agreement shall be construed to require Owner to proceed with the construction of the Digital Display.
(b) The decision to proceed or to forbear or delay in proceeding with construction of the Digital Display shall be in Owner’s sole discretion. (c) Except as provided in this Agreement, the decision to proceed or to forbear or delay in proceeding with construction of the Digital Display shall be in Owner’s sole discretion.

2.3.2 Failure to Proceed. Failure by Owner to proceed with construction of the Digital Display shall not result in any loss or diminution of development rights for the Digital Display, except upon expiration of Owner’s Vested Rights pursuant to this Agreement, or the termination of this Agreement.
9 2.3.3 Conditions of Approval. Notwithstanding any provision of this Section 2.3 to the contrary, Owner shall be required to implement all conditions of approval required under this Agreement in accordance with and at the time specified in Exhibit “D” and may be subject to all remedies specified in this Agreement for the failure to implement these conditions of approval as and when so required.

2.4 Vested Rights.

2.4.1 Approval of Digital Display Plans. The City hereby approves the Digital Display Plans as the conceptual scope of the Digital Display. The City shall maintain a complete copy of the Digital Display Plans, stamped “Approved” by the City, in the Office of the City Clerk, and Owner shall maintain a complete copy of the Digital Display Plans, stamped “Approved” by the City, in its offices or at the Property. The Digital Display Plans to be maintained by the City and Owner shall be in a half-size set.

2.4.2 Minor Modifications to Digital Display. Owner, with the approval of the Community Development Director, may make minor changes to the Digital Display or Digital Display Plans (“Minor Modifications”) without amending this Agreement; provided that the Community Development Director makes the following specific findings that the Minor Modifications: (i) are generally consistent with the Digital Display’s overall qualities and characteristics as approved by the City Council; (ii) are consistent with the provisions, purposes and goals of this Agreement; (iii) are not detrimental to the public health, safety, convenience or general welfare; (iv) are consistent with the LUCE, DCP, and Digital Display District Ordinance; and (v) will not significantly and adversely affect the project and community benefits (Section

2.5) associated with the Digital Display, unless expressly authorized in Section 2.5. For the avoidance of doubt, any Minor Modification approving an increase or decrease in the square footage in a Digital Display shall document the proportionate increased or decreased One-Time Community Benefit and MAG Contribution in compliance with the Digital Display District Ordinance then in effect. The Community Development Director shall notify the Planning Commission and City Council in writing of any Minor Modifications approved pursuant to this Section 2.4.2. Any proposed change which the Community Development Director denies as not qualifying for a Minor Modification based on the above findings will only be processed as a Major Modification.

2.4.3 Modifications Requiring Amendment to this Agreement. Owner shall not make any “Major Modifications” (defined below) to the Digital Display without first amending this Agreement to permit such Major Modifications. A “Major Modification” means the following:
(a) Any increase in the square footage above the maximum display area allowed by the Digital Display District Ordinance, as it may be amended from time to time; (b) Any material variation in the design or location of the Digital Display (except as permitted as a Minor Modification pursuant to Section 2.4.2) that renders such aspects out of substantial compliance with the Digital Display Plans after Coastal Commission approval;
10 (c) Any deviation from the Digital Display District Ordinance, as it may be amended from time to time;
(d) Any other change that would reduce or materially alter the project and community benefits as set forth in Section 2.5, unless expressly authorized in Section 2.5; and
(e) Any extension of the Term beyond the extensions provided for in Section 9.2.5.

If a proposed modification does not exceed the Major Modification thresholds established above, then the proposed modification may be reviewed as a Minor Modification in accordance with Section 2.4.2.

2.4.4 City Consent to Modification. The City may impose customary fees, exactions, and conditions, in connection with its approval of a Minor or Major Modification, subject to any applicable law. Notwithstanding anything to the contrary herein or in the Existing Regulations, if the Community Development Director approves a Minor Modification or if the City approves a Major Modification (and the corresponding amendment to this Agreement for such Major Modification), as the case may be, Owner shall not be required to obtain any other Discretionary Approvals for such modification in the case of certain Major Modifications.

2.4.5 Right to Develop. Subject to the provisions of Section 3.3 below, during the Term (as defined in Section 9.2 below) of this Agreement, Owner shall have the vested rights (the “Vested Rights”) to (a) develop and construct the Digital Display in accordance with the following: (i) the Digital Display Plans (as the same may be modified from time to time in accordance with this Agreement); (ii) any Minor Modifications approved in accordance with Section 2.4.2; (iii) any Major Modifications which are approved pursuant to Section 2.4.3; and (iv) the requirements and obligations of Owner related to the improvements which are specifically set forth in this Agreement, and (b) operate the Digital Display pursuant to the terms of this Agreement and through the Term of this Agreement. The City shall have no further discretion over the elements of the Digital Display which have been delineated in the Digital Display Plans (as the same may be modified from time to time in accordance with this Agreement).

2.5 Project and Community Benefits. Set forth below in this Section 2.5 are the project and community benefits that will be provided by the Digital Display.

2.5.1 One-Time Community Benefit Contribution. Within thirty (30) Days of issuance of the Digital Display Commencement Date, Owner shall pay a one-time community benefits contribution to the City in the amount of Five Hundred Thousand Dollars ($500,000) (the “One-Time Community Benefit Payment”). If the One-Time Community Benefit Payment is not made on or before June 30, 2027, then it shall escalate by three percent (3%) on June 30, 2027, and annually by three percent (3%) each June 30 thereafter until it is made.

2.5.2 Ongoing Community Benefit Contribution. Commencing on the Digital Display Commencement Date and continuing for each calendar year during the remainder of the Term, Owner shall pay to the City an amount (the “Ongoing Community Benefit 11 Contribution”) equal to the greater of: (a) the Revenue Share Contribution (as set forth in subsection (a) below), and (b) the applicable MAG Contribution (as set forth in subsection (b) below).
(a) Revenue Share Contribution. Owner shall pay to the City (“Revenue Share Contribution”) an amount equal to twenty percent (20%) of the Annual Gross Revenues received for Digital Advertising Services. Such Revenue Share Contribution shall be paid annually to the City in accordance with Section 2.5.2(d) below.
(b) Minimum Annual Guaranteed Contribution. Beginning on the Digital Display Commencement Date and in accordance with the timing specified in Section 2.5.2(c) below, Owner shall pay to the City a minimum annual guaranteed payment (the “MAG
Contribution”) equal to Five Hundred Thousand Dollars
($500,000), which amount shall escalate by three percent (3%) commencing on June 30, 2027, and annually by three percent (3%) each June 30 thereafter.

Notwithstanding the foregoing, if the City approves more than nine (9) digital displays in the Digital Display District, as it may be amended from time to time, then commencing with the first quarterly MAG Contribution after such additional digital display’s Digital Display Commencement Date, the MAG Contribution otherwise due under this Agreement shall be reduced by three percent (3%) per digital display exceeding nine (9) (e.g., 3% reduction at the Digital Display Commencement Date for the 10th digital display, additional 3% reduction at the Digital Display Commencement Date for the 11th digital display, etc.).

Notwithstanding anything to the contrary herein, in no event will the City be required to pay or refund any sum to Owner as a result of the MAG Contribution reduction.
(c) Timing of MAG Contribution. Commencing with the Digital Display Commencement Date, the MAG Contribution shall be paid quarterly in arrears to City on or before the thirtieth (30th) day following the expiration of each Calendar Quarter during the Term and shall be prorated for any partial Calendar Quarter based on the number of Days within such time period. Concurrent with payment of the MAG Contribution, Owner shall submit confirmation in writing of the amount of the MAG Contribution paid and
documenting any increases/decreases in the MAG Contribution compared with the prior quarterly MAG Contribution payment including citations to the relevant section of this Agreement supporting any such increase/decrease (e.g. 2.5.2(g) late payment,

2.5.4 failure to meet occupancy threshold, 2.5.2(b) saturation, 12 2.5.2(h) abatement credit, 3.6 temporary removal) and any relevant documentation.
(d) Revenue Share Contribution Timing. The Revenue Share Contribution shall be paid annually in arrears no later than fortyfive (45) Days following the end of the year to which the Revenue Share is attributable (the “Reconciliation Payment Date”). No later than the Reconciliation Payment Date, Owner shall submit to the City a statement of the Revenue Share Contribution calculation for the immediately preceding year (January 1-December 31) along with a reconciliation statement (collectively, the “Reconciliation Statement”), reflecting the calculation of the Revenue Share Contribution due and owing for such calendar year (the “Annual Reconciliation”). If the amount of Revenue Share Contribution payable by Owner set forth in the Reconciliation Statement is more than the amount of MAG Contribution actually paid by Owner for such year (including any Supplemental MAG, if applicable), Owner shall pay the difference between the Revenue Share Contribution and the MAG Contribution (including any
Supplemental MAG, if applicable) paid to the City concurrently with the submission of the Reconciliation Statement for that year. (e) Statements of Annual Gross Receipts; Reconciliation Statement.

The Reconciliation Statement shall be accompanied by the signed certificate of the designated representative of the Owner, certifying specifically that (i) such report presents fairly and accurately reflects the Annual Gross Revenues of the calendar year, and (ii) the said Annual Gross Revenues conform with and are computed in
compliance with the definition of Annual Gross Revenues. (f) Records. For the purpose of permitting verification by City of any amount due to City as Revenue Share Contribution, Owner shall keep and preserve, or cause to be kept and preserved by Operator, for at least three (3) years after each calendar year as to such calendar year, and during the Term shall keep at the Property or at Operator’s premises at a designated location in Los Angeles County, a general ledger, required receipts and disbursement journals, and such sales records and other supporting
documentation together with original or duplicate books and records which shall disclose in detail all information required to permit City to verify Gross Revenues and which shall conform to and be in accordance with generally accepted accounting principles consistently applied. Not more than two (2) times per calendar year, after five (5) Business Days advance written notice to Owner or Operator, City or its employees, agents and/or accountants, shall have the right during business hours to make an examination or audit and copy of such books and records relevant to the determination of Gross Revenues (which examination may be 13 conducted physically at the Property or Operator’s premises in Los Angeles County or by Owner or Operator making available such books and records by electronic means). If such audit discloses that, in any calendar year, the Revenue Share Contribution owed to City is greater than the Revenue Share Contribution paid to City for such period, Owner shall pay to City, within ten (10) Days of notice thereof accompanied by reasonable documentary evidence thereof, such liability. In addition, if such audit shall disclose that Owner has underpaid by four percent (4%) or more any Revenue Share Contribution payable by Owner, then in such event, within ten (10) Days following written notice by City of the costs of such audit and amount due of the Revenue Share Contribution plus interest accompanied by reasonable documentary evidence thereof, Owner shall pay the cost of such audit, all Revenue Share Contribution then payable, plus interest as set forth in subparagraph (g), below, on such the amount of Revenue Share Contribution owed, calculated from the date such additional Revenue Share Contribution was originally due and payable. In the event Owner fails to pay the costs of audit, Revenue Share Contribution due and interest thereon, within the ten (10) calendar day period specified herein, then such failure shall constitute a Default, as that term is defined in Article 11.
(g) Late Payment. If any installment of the MAG Contribution (including any Supplemental MAG, if applicable) and/or Revenue Share Contribution is not received by City within five (5) Business Days after Owner’s receipt of written notice of such delinquency, then Owner shall pay to City a late charge equal to five percent (5%) of the overdue amount, plus interest on the unpaid amount at five percent (5%) per annum pro rated daily for the delinquency period until paid.
(h) Impairment of Use.
(1) Abatement Event. Subject to the provisions herein, Owner may receive a pro rated daily abatement credit (for the period described in Section 2.5.2(h)(5) below) against the MAG Contribution due to (i) any improvements, landscaping,
vegetation, signage or structures installed or placed by City in the public sidewalks or public right of way after the Effective Date of this Agreement, (ii) utility services necessary to operate the Digital Display being interrupted for a period exceeding two (2) Business Days and such interruption is not caused by the acts or omissions of Owner or any tenant on the Property, which utility services may include, but are not limited to, electric, data, and/or internet service, (iii) commencement of an eminent domain proceeding by City or 14 (iv) the use of the Digital Display or the visibility of the Digital Display are materially impaired as a result of (x) the City’s failure to perform any of its obligations under this Agreement (y) any act, event or condition listed under Section 15.8.1 below, or (z) the acts or omissions of any third party but not those of Owner, Operator, or any other tenant on the Property (each individually or collectively constituting an “Abatement Event”).
(2) Abatement Harm. If an Abatement Event occurs, then
abatement shall only apply if the visibility of the Digital Display has been substantially and materially impaired, which results in material adverse impact on Owner’s or Operator’s ability to sell advertisements on the Digital Display or collect revenues from sold advertisements (“Abatement Harm”), as evidenced by any advertiser (whether subject to an advertising contract with Owner or a potential future advertiser or any Operator), rejecting the Owner or Operator’s proof of
performance in the form of photos, canceling such advertising contract or declining to renew or extend advertising time on the Digital Display, or an advertiser declining to purchase advertising time on the Digital Display in each case, directly as a result of the Abatement Event.
(3) Notice of Abatement Event. In the event of any claim by Owner for abatement due to an Abatement Event, Owner shall provide written notice to the City no later than ten (10) Days upon learning of the alleged commencement of the Abatement Event. Owner and City shall meet and confer within five (5) Business Days of City’s receipt of the notice from Owner. (4) Documentation of Abatement Event and Abatement Harm.

Prior to meeting and conferring with the City and as a precondition to receiving any abatement, Owner shall provide a certified claim statement (“Certified Claim”), signed by the designated representative of the Owner, certifying (i) the detailed nature of the claimed Abatement Event and Abatement Harm, (ii) that such claimed impairment will have a material and substantial impact on the revenue generation of the Digital Display and (iii) providing documentation of the Abatement Event and the Abatement Harm, including but not limited to photos and any advertiser communications evidencing a
rejection of the proof of performance, exercising a right of cancellation or refusal to renew, or an advertiser declining to purchase advertising time on the Digital Display due to the Abatement Event (“Claim Documentation”).
15 (5) Abatement Period. The abatement of the MAG Contribution as permitted by this Section shall commence upon the date Owner provides notice to the City as required by Section 2.5.2(h)(4) and continue so long as the Abatement Harm continues due to the Abatement Event (“Abatement Period”).
(6) Abatement Credit Timing. Owner understands, acknowledges and agrees that Owner has no right to withhold the MAG
Contribution until and unless the meet and confer period has been completed, and the Owner has provided the Certified Claim and Claim Documentation to City, after which point the City reserves all rights to protest and/or dispute the Certified Claim, or any portion thereof, and exercise its rights under and in accordance with Article 11. The daily abatement credit in this Section 2.5.2(h) shall be applied to the next MAG
Contribution for the Abatement Period. For the avoidance of doubt, (i) the abatement of the MAG Contribution during the Abatement Period shall in no way reduce or abrogate Owner’s obligation to pay City the Revenue Share Contribution in accordance with Section 2.5.2, and (ii) the Abatement Credit shall be deducted from the applicable MAG Contribution and the Owner shall pay City an amount equal to the greater of the Revenue Share Contribution and the MAG Contribution as
adjusted.
(7) Parties’ Collaboration on Abatement Cure. During the meet and confer period provided in subparagraph (h)(3), the Parties shall discuss how to best mitigate and cure the Abatement Event to minimize scope and duration of the Abatement Harm and, if the Abatement Event is attributable to the City under subparagraphs (h)(1)(i), (h)(1)(iii), and (h)(1)(iv)(x), City shall use reasonable good faith efforts to assist with curing such Abatement Event.
(8) No Right to Abatement Attributable to Owner’s Actions.

Notwithstanding any provisions to the contrary, Owner shall have no right to abatement for impairment of use under
subparagraph (h) that are attributable to Owner, Operator, or any other tenant on the Property, including, without limitation, in the event of Owner’s Existing Building repairs, remodeling, reconstruction or redevelopment which is separately governed by Section 3.6.
(9) No City Obligation to Undertake Landscaping Above and Beyond Customary Level of Services. Notwithstanding
anything to the contrary in this Agreement, City has no obligation to provide any public services above and beyond the customary level of services provided by City in the vicinity of 16 the Digital Display as of the Effective Date, including, without limitation, tree trimming.
(i) Breach or Default. Without limiting the generality of Article 11, events of Breach or Default shall include: (i) Owner’s failure to pay any amounts owed to City within fourteen (14) Days of when due; (ii) Owner’s failure to provide a Reconciliation Statement within fourteen (14) Days of when due; (iii) an audit by City disclosing an underpayment to City of more than four percent (4%); and (iv) City’s inability to perform an audit in accordance with generally accepted auditing standards because Owner has failed to maintain records and/or provide access in accordance with this Agreement. Nothing in this Section modifies the notice and cure provisions in Article 11 applicable to events of Breach or Default.
(j) Public Records Act Request. As the Reconciliation Statement and/or other information provided by Owner to the City pursuant to this Agreement may contain confidential and/or propriety financial information and/or trade secrets, City agrees it shall notify Owner upon receipt of a Public Records Act (Gov’t Code Sections 7920, et seq.) request pertaining to any Reconciliation or other financial documents provided by Owner pursuant to this Agreement and shall not provide access to any such documents to the requesting party or any members of the public unless and until the City has notified Owner in writing of the request and provided Owner with at least ten (10) Days to object to disclosure of such documents on the basis such information is exempt from disclosure under the Public Records Act. If Owner notifies the City in writing of such an objection within the ten (10) day period, then City shall not provide such documents to the requesting party or any other member of the public except in the event of a court order and provided Owner fully indemnifies and defends the City in any litigation related to the withholding of such documents. Nothing in this Agreement shall constitute a waiver or diminishment of any of the exemptions to disclosure provided in the California Public Records Act or other law.

2.5.3 City and Art Content Allocation. Owner shall provide for the display of “City Content Allocation” in accordance with Digital Display District Ordinance. (a) Flexible Use. Any of the City Content Allocation not used by the City may, in the City’s sole discretion, be relinquished back to Owner at no cost so that Owner may, at its sole discretion, either (1) make it available for paid advertising or (2) display non-City art and civic and/or charitable programming. If used for paid advertising, revenue generated shall be considered as part of the Annual Gross Revenues.
17 (b) Reporting and Recordkeeping. On an annual basis prior to or concurrent with delivery of the Reconciliation Statement, the Owner shall provide the City Manager with a report demonstrating compliance with the City Content Allocation as specified in this Section 2.5.3 for the prior calendar year. The annual City Content Allocation report will include playback logs sourced from the content management system used to operate the Digital Display. The playback logs will indicate times and durations of all the various paid advertising and all other non-commercial content that has been displayed over the past year, as well as a cumulative summary of all commercial and non-commercial content displayed over that timeframe. The playback logs shall be retained by Owner or its third-party advertising Operator for a minimum of three (3) years following the conclusion of the calendar year to which such records pertain.

2.5.4 Commemorative Installation. Owner shall install a permanent commemorative installation on the Property in an area accessible or visible to the public that portrays one or more aspects of the history and significance of the site as reflected in the Findings and Determinations of the Landmarks Commission (08-LM-005). The commemorative installation may include, but is not limited to, a plaque, photograph(s), postcard(s), illustration(s), map(s), etching, display board, video screen, narrative or electronic content in a creative medium. The commemorative installation shall be developed with guidance from a Qualified Historic Preservation Professional and will be reviewed by the Landmarks Commission in a public hearing but will not require a Certificate of Appropriateness. If the Landmarks Commission does not hold such public hearing within 60 Days of Owner’s written request, then the exhibits shall be reviewed by the City’s Landmarks Commission Liaison or other staff as designated by the Community Developer Director’s designee. In the process of designing such commemorative installation, the design team shall also consult with and consider suggestions or refinements that might be offered by representatives from the Santa Monica Conservancy. If the commemorative installation is not installed within two (2) years of issuance of Certificate of Occupancy or final permit sign-off, as applicable, for the Digital Display, then City may, subject to the notice and cure provisions of Article 11, obligate Owner to shut off the Digital Display until such time as the commemorative installation is installed.

2.5.5 Blade Sign. The Existing Building includes an architectural element that was originally designed for and used as a blade sign for JC Penney. That architectural element does not currently serve any purpose. As shown on the plans attached hereto as Exhibit B, Owner shall reactivate the use of the blade sign to identify the commercial tenant that occupies the Existing Building, consistent with the historical purpose of that architectural element of the building.

2.5.6 Existing Building Occupancy.
(a) Occupancy Threshold. Beginning on the Digital Display Commencement Date, if either (i) more than fifty percent (50%) of the rentable floor area within the Existing Building or (ii) the entire ground floor level of the Existing Building ("Occupancy Threshold") remains unoccupied for more than twelve (12) consecutive months during the Term, then for the period commencing on the first (1st) day following such twelve (12) month period and ending on the first (1st) day thereafter that the occupancy level of the Existing Building satisfies the Occupancy Threshold (“Occupancy Threshold Period”), the MAG Contribution shall be increased by twenty-five percent (25%) (non-compounded) on a daily 18 prorated basis during the Occupancy Threshold Period (“Supplemental MAG Contribution”).

Any late payments of the Supplemental MAG Contribution shall be subject to Section 2.5.2(g). (b) Payment of Supplemental MAG Contribution. The Supplemental MAG Contribution shall be applied to the next MAG Contribution following the commencement of the Occupancy Threshold Period. For the avoidance of doubt, the payment of the Supplemental MAG Contribution shall in no way reduce or abrogate Owner’s obligation to pay City the Revenue Share Contribution in accordance with Section 2.5.2. (c) Deferment of Commencement of Occupancy Threshold Period. In the event that the occupancy level of the Existing Building is beneath the Occupancy Threshold and the Owner is using reasonable good faith efforts to cause the occupancy level of the Existing Building to satisfy the Occupancy Threshold (and has provided City with reasonable supporting documentation of such commercially reasonable efforts), then the City Manager may provide up to two twelve (12) month extensions before the Supplemental MAG Contribution is owed to City. Moreover, rentable floor area in the Existing Building shall not be deemed unoccupied for the purposes of this paragraph if (A) such floor area is leased to a tenant under a lease that existed as of the Effective Date, (B) such lease prevents the tenant from being held in default solely for ceasing operations, provided other lease terms (e.g., rent payments) are fulfilled, and (C) such non-continuous operation provision (or similar) is the primary reason that Owner has not terminated such lease in order to place a new tenant into such floor area. (d) Major Repair, Remodeling or Reconstruction. During any period that any major repair, remodeling or reconstruction is being undertaken with respect to the Existing Building, which prevents occupancy of the building by one or more commercial tenants during the period of such major repair, remodeling or reconstruction, the occupancy level of the Existing Building shall be deemed to satisfy the Occupancy Threshold, regardless of the actual occupancy level of the Existing Building during such period, provided that the repair, remodeling or reconstruction is proceeding with due diligence under an active Building Permit and in no event for longer than a period of twenty four (24) months, which time can be extended by the City Manager based on substantial evidence that the failure to achieve the Occupancy Threshold is based on any of the events occurring under Section 15.8.1. The twenty four (24) month period shall begin to run from the date that the Owner obtains an active and valid building permit that has been issued by the City to undergo the applicable repair, remodeling or reconstruction. The occupancy level of the Existing Building shall also be deemed to satisfy the Occupancy Threshold, regardless of the actual occupancy level of the Existing Building during such period that Owner has active and valid permits that have been issued by the City for the Existing Building to undergo mandatory seismic strengthening required under the City’s Seismic Retrofit Ordinance, or other work necessary to comply with any applicable laws or regulations implemented following the Effective Date, provided that the work is being diligently pursued, as determined by the City Manager or designee.
(e) The Supplemental MAG Contribution is the City's sole and exclusive remedy for the failure to meet the Occupancy Threshold and failure to satisfy the Occupancy Threshold shall not constitute a Default by Owner so long as Owner is paying the increased MAG Contribution required by subsection (a). Notwithstanding the foregoing remedy, (i) if the occupancy level of the Existing Building is beneath the Occupancy Threshold for more than four (4) consecutive years during the Term, City may as an alternative sole and exclusive 19 remedy, subject to the notice and cure provisions of Article 11, obligate Owner to shut off the Digital Display until such time as the Occupancy Threshold is met and (ii) if the occupancy level of the Existing Building is beneath the Occupancy Threshold for more than five (5) consecutive years during the Term and the Owner does not demonstrate good faith efforts to lease rentable floor area or entire ground floor area of the Existing Building, City may, subject to the notice and cure provisions of Article 11, terminate this Agreement. (f) On an annual basis concurrent with delivery of the Reconciliation Statement, Owner shall notify the City in writing whether the Occupancy Threshold is satisfied, and if it is not satisfied, the date the Existing Building first failed to satisfy the Occupancy Threshold.

2.6 Maintenance and Upgrades. After the Building Official’s final approval or signoff, as applicable, for the Digital Display and for as long as the Digital Display is in place, Owner shall maintain the Digital Display (including its support structure) in safe, attractive and good condition, clean and free of graffiti. In the event the Digital Display malfunctions or becomes damaged or otherwise requires repair, Owner shall complete the needed repair as soon as practicable and in any event respond within one (1) Business Day after receiving notice from the City of the need for maintenance. Provided that any such repair work is limited to the Digital Display itself or its entablature, no City approvals will be required. In addition, Owner may replace, update, or upgrade all or any portion of the Digital Display provided that (a) the size and orientation of the Digital Display are not altered and (b) the Digital Display complies with the Digital Display District Ordinance. Any modifications proposed as part of the replacement, update or upgrade of the Digital Display shall be reviewed under Sections 2.4.2-2.4.4 and/or Article 6, as applicable.

2.7 Removal of Digital Display. At the end of the Term of this Agreement (or if this Agreement is terminated earlier pursuant to this Agreement), Owner shall remove the Digital Display and patch/repair the façades of the Existing Building. Provided the patch/repair of the facades of the Existing Building is done in consultation with a Qualified Historic Preservation Professional retained by Owner and in a manner consistent with the Secretary of the Interior’s Standards, the patch/repair work shall be reviewed and approved by the City’s Landmarks Commission Liaison as an administratively-issued Certificate of Appropriateness.

Notwithstanding the foregoing, Owner shall not be required to remove the Digital Display if Owner and City have entered into an extension of this Agreement or a new agreement regarding the continued operation of the Digital Display on the Property. Further, Owner shall not be required to remove the Digital Display for up to six (6) months following such expiration or termination if Owner and the City are in reasonable good faith negotiations to enter into a new agreement regarding the operation of the Digital Display and the City Manager has approved such non-removal.

2.8 Projections, Design, and Operation Standards.
(a) Projections from the Existing Building, design, and operation of the Digital Display shall conform to the Digital Display District Ordinance. (b) Exemption From City Sign Code. For avoidance of doubt, the Digital Display shall be exempt from the City’s Sign Code (SMMC Chapter 9.61). 20 2.9 Coastal Commission Review. After the Effective Date of the Development Agreement, the Community Development Director, or his or her designee, shall provide Owner with a fully completed and executed Section 2 of the Local Agency Review Form (Appendix B of the Coastal Development Permit Application) and shall stamp and return to Owner two sets of Digital Display Plans within 15 Days after receiving such a written request and the associated processing fee from Owner.

2.10 Owner Solely Responsible for Compliance with The Terms and Conditions of this Agreement. Owner shall comply with any act or obligation to be performed by or on the part of Owner under the terms of this Agreement or cause Operator to comply with any act or obligation to be performed by or on the part of Owner under the terms of this Agreement, with the same force and effect as if performed by Owner. Operator’s failure to comply with the terms of this Agreement shall not be deemed to excuse Owner’s obligations under this Agreement and City shall have no obligation to seek any remedies against Operator for Operator’s violation of this Agreement, it being understood, acknowledged and agreed to by Owner that Owner is solely responsible for the obligations attributed to Owner under this Agreement.

2.11 Operator Not a Third-Party Beneficiary to this Agreement. Owner understands, acknowledges and agrees that Operator is not a third party beneficiary to this Agreement. As a condition precedent to the Effectiveness of this Agreement, Operator shall acknowledge and consent, on behalf of itself and its successors and assigns, that Operator has no right to claim third party beneficiary status under this Agreement.

2.12 Relationship to Owner/Operator Agreements. Nothing in this Agreement modifies any agreements between Owner and Operator as between themselves, separate and apart from the obligations to the City.

ARTICLE 3

CONSTRUCTION

3.1 [Reserved.]

3.2 Construction Hours. Owner shall be permitted to perform construction related to the Digital Display between the hours of 8:00 a.m. to 6:00 p.m. Monday through Friday, and 9:00 a.m. to 5:00 p.m. Saturday; provided that interior construction work which does not generate noise of more than thirty (30) decibels beyond the Property’s property lines may also be performed between the hours of 7:00 a.m. to 8:00 a.m. and 6:00 p.m. to 7:00 p.m. Monday through Friday, and 8:00 a.m. to 9:00 a.m. and 5:00 p.m. to 6:00 p.m. Saturday. Notwithstanding the foregoing, pursuant to SMMC Section 4.12.110(e), Owner has the right to seek a permit from the City authorizing construction activity during the times otherwise prohibited by this Section.

3.3 Outside Building Permit Issuance Date.
i. Subject to Section 3.5, if Owner has not been issued a building permit for 21 the Digital Display by the “Outside Building Permit Issuance Date” (defined below), then on the day after the Outside Building Permit Issuance Date, without any further action by either Party, this Agreement shall automatically terminate and be of no further force or effect. For purposes of clarity, if Owner has not been issued a building permit for the Digital Display by the Outside Building Permit Issuance Date, the City shall not be required to pursue its remedies under Section 11.4 of this Agreement, and this Agreement shall, instead, automatically terminate. “Outside Building Permit Issuance Date” means the date that is two (2) years after the Effective Date; provided that the Outside Building Permit Issuance Date shall automatically be extended by applicable Excusable Delays and otherwise in accordance with the remainder of this Article 3.
ii. If the approval by the California Coastal Commission of the Digital Display does not occur within six (6) months of the submittal by Owner to the Coastal Commission, then the Outside Building Permit Issuance Date shall automatically be extended one month for each additional month or partial month greater than six (6) that the Coastal Commission approval is delayed. If issuance of the building permit for the Digital Display does not occur within four (4) months of Owner’s submittal of a complete plan check application for the Digital Display and Owner is diligently processing such plan check application, including, without limitation, responding in a timely and responsive manner to City building official comments, then the Outside Building Permit Issuance Date shall automatically be extended one month for each additional month or partial month greater than four (4) that the building permit issuance is delayed.
iii. At any time after the Effective Date but before the Outside Building Permit Issuance Date, Owner may deliver written notice to the Community Development Director, requesting an extension of the Outside Building Permit Issuance Date for an additional twelve (12) months. The Community Development Director shall grant such extension if Owner can demonstrate substantial progress has been made towards obtaining a building permit and show reasonable cause why Owner will not be able to obtain the building permit for the Digital Display by the Outside Building Permit Issuance Date and can demonstrate that: (a) the condition of the Property will not adversely affect public health or safety and (b) the continued delay will not create any unreasonable visual or physical detriment to the neighborhood.

3.4 Construction Period. Construction of the Digital Display shall be completed no later than eighteen (18) months from issuance of the building permit. If a building permit for all or part of the Digital Display expires (e.g., is not timely exercised) or lapses and the Outside Building Permit Issuance Date has not expired, Owner may file for renewal of such building permit or a new/replacement building permit prior to the Outside Building Permit Issuance Date, as it may be extended pursuant to Section 3.3 above.

3.5 Extended Vested Rights. Notwithstanding any other provision of this Agreement, if prior to the Outside Building Permit Issuance Date (as it may be extended) and/or end of the construction period in Section 3.4, Owner pays to the City twenty-five percent (25%) of the MAG Contribution specified in Section 2.5.2(b) prorated on a daily basis (“Partial MAG Payment”), then the Outside Building Permit Issuance Date and/or the construction period specified in Section 3.4, as applicable, shall automatically be extended so long as such Partial MAG Payment continues quarterly up to a maximum of five (5) years from the Effective Date; 22 provided, however, that City shall have, as its exclusive remedy, the right to terminate this Agreement, subject to the notice and cure provisions under Article 11 if the Outside Building Permit Issuance Date extends beyond five (5) years from the Effective Date and/or the construction period specified in Section 3.4 extends beyond three (3) years.

3.6 Existing Building Repairs, Remodeling, Reconstruction or Redevelopment and/or Digital Display Damage. In the event that (a) the Existing Building undergoes a major repair, remodeling, reconstruction or redevelopment that results in or requires removal of the Digital Display or (b) the Digital Display is damaged or destroyed so as to be inoperable during the Term of this Agreement due to actions or events that are outside the reasonable control of the Owner, Operator, or any other tenant on the Property:
i. Owner shall be entitled to reinstall and/or reconstruct the Digital Display in accordance with this Agreement if: (a) the major repair, remodeling, reconstruction or redevelopment that results in or requires removal of any of the Digital Displays is proceeding with due diligence and (b) the Owner is not in Breach of this Agreement. ii. The Term of this Agreement shall toll during the period the Digital Display is removed and shall resume on the date of issuance of a certificate of occupancy (or final building permit signoff, as applicable) for the reconstructed Digital Display by the applicable City building authorities (the “Temporary Removal Period”). For the avoidance of doubt, the MAG Contribution shall continue to escalate in accordance with Section 2.5.2(b) during any Temporary Removal Period.
iii. The MAG Contribution in Section 2.5 shall abate on a day-for-day basis during any Temporary Removal Period. Notwithstanding the foregoing, if at Owner’s election, in its sole discretion, and with City approval, Owner installs temporary scaffolding to allow a temporary substitute for the Digital Display to be installed on the Property during any Temporary Removal Period, Owner shall pay the City ten percent (10%) of Gross Revenues from the temporary substitute display no later than sixty (60) Days from the end of the Temporary Removal Period.

3.7 City Termination Option. Notwithstanding anything in the foregoing to the contrary, in the event the Temporary Removal Period (x) exceeds three (3) years under the circumstances described in Section 3.6(a) (the Existing Building undergoes a major repair, remodeling, reconstruction or redevelopment that requires removal of the Digital Display) and such circumstances are not caused by any act, event or condition listed under Section 15.8.1(a); (y) exceeds six (6) years under the circumstances described in Section 3.6(a) (the Existing Building undergoes a major repair, remodeling, reconstruction or redevelopment that requires removal of the Digital Display) and such circumstances are caused by any act, event or condition listed under Section 15.8.1; or (z) exceeds eighteen (18) months under the circumstances described in Section 3.6(b) (the Digital Display is damaged or destroyed during the Term of this Agreement), then the City may exercise, as its exclusive remedy, the right to terminate this Agreement, subject to the notice and cure provisions under Article 11. Alternatively, if the City does not exercise its right to terminate this Agreement, the Partial MAG Payment shall continue for so long as the City does not exercise the right to terminate. 23 ARTICLE 4

FEES, EXACTIONS, AND CONDITIONS

4.1 Fees, Exactions, and Conditions. Except as expressly set forth in Section 2.5 (relating to Community Benefits), Section 4.2 (relating to modifications), and Section 5.2 (relating to Subsequent Code Changes) below, the City shall charge and impose only those fees, exactions, conditions, and standards of construction set forth in this Agreement, including Exhibits “D” and “E”, respectively, attached hereto, and no others. If any of the conditions set forth on Exhibit “D” is satisfied by others, Owner shall be deemed to have satisfied such conditions. Notwithstanding the foregoing, except to the extent specifically provided otherwise, this Agreement does not require Owner to pay any exactions nor implement any conditions of approval if Owner does not obtain a building permit for the Digital Display prior to expiration of the Outside Building Permit Issuance Date including any extensions thereof or any tolling thereof in accordance with Section 3.3.

4.2 Conditions on Modifications. The City may impose fees, exactions, and conditions in connection with its approval of Minor or Major Modifications, provided that all fees, exactions, and conditions shall be in accordance with any applicable law.

4.3 Implementation of Conditions of Approval. Owner shall be responsible to adhere to the conditions of approval set forth in Exhibit “D” in accordance with the timelines established in Exhibit "D".

ARTICLE 5

EFFECT OF AGREEMENT ON CITY LAWS AND REGULATIONS

5.1 Development Standards for the Digital Display; Existing Regulations. The following development standards and restrictions set forth in this Section 5.1 govern the use and development of the Digital Display and shall constitute the Existing Regulations, except as otherwise expressly required by this Agreement. Nothing herein shall be deemed to apply to the Existing Building, excluding the Digital Display.

5.1.1 Defined Terms. The following terms shall have the meanings set forth below:
(a) “Existing Regulations” collectively means all of the following which are in force and effect as of the Effective Date: (i) the General Plan (including, without limitation, the LUCE); (ii) the DCP, (iii) the Zoning Ordinance except as modified herein; (iv) the Digital Display District Ordinance; (v) any and all ordinances, rules, regulations, standards, specifications and official policies of the City governing, regulating or affecting the design, development, building, construction, occupancy or use of buildings, signs/billboards, and improvements or any exactions therefore, except as amended by this Agreement; (v) the City’s 1992 LUP; and (vi) the development standards and procedures in Article 2 of this Agreement. 24 (b) “Subsequent Code Changes” collectively means all of the following which are adopted or approved subsequent to the Effective Date, whether such adoption or approval is by the City Council, any department, division, office, board, commission or other agency of the City, by the people of the City through charter amendment, referendum, initiative or other ballot measure, or by any other method or procedure: (i) any amendments, revisions, additions or deletions to the Existing Regulations; or (ii) new codes, ordinances, rules, regulations, standards, specifications and official policies of the City governing or affecting the design, development, construction, occupancy or use of building, signs/billboards, or improvements or any exactions therefor. “Subsequent Code Changes” includes, without limitation, any amendments, revisions or additions to the Existing Regulations imposing or requiring the payment of any fee, special assessment or tax.

5.1.2 Existing Regulations Govern the Digital Display. Except as provided in Section 5.2, development of the improvements that will comprise the Digital Display, including without limitation, the development standards for the design, development, construction, or use of such Digital Display, and any exactions therefore, shall be governed by the Existing Regulations. The City agrees that this Agreement is consistent with the Digital Display District Ordinance, General Plan, including the LUCE and the DCP, and the 1992 LUP. Any provisions of the Existing Regulations inconsistent with the provisions of this Agreement, to the extent of such inconsistencies and not further, are hereby deemed modified to that extent necessary to effectuate the provisions of this Agreement. The Digital Display shall be exempt from: (a) all Discretionary Approvals or review by the City or any agency or body thereof, other than review of modifications to the Digital Display as expressly set forth in Sections 2.4.2 and 2.4.3; (b) the application of any subsequent local sign, billboard, and/or digital display moratoria, sign, billboard, and/or digital display rationing systems or other restrictions on sign, billboard, and/or digital displays which would adversely affect the rate, timing, or phasing of construction of the Digital Display, and (c) Subsequent Code Changes which are inconsistent with this Agreement.

5.2 Permitted Subsequent Code Changes.
(a) Applicable Subsequent Code Changes. Notwithstanding the terms of Section 5.1, this Agreement shall not prevent the City from applying to the Digital Display the following Subsequent Code Changes set forth below in this Section 5.2(a). Processing fees and charges imposed by the City to cover the estimated actual costs to City of processing applications for development approvals including: (i) all application, permit, and processing fees incurred for the processing of this Agreement, any administrative approval of a Minor Modification, or any amendment of this Agreement in connection with a Major Modification; (ii) all building plan check and building inspection fees for work on the Digital Display in effect at the time an application for a grading permit or building permit is applied for; (iii) the public works plan check fee and public works inspection fee for public improvements constructed and installed by Owner; (iv) fees for monitoring compliance with any development approvals; (v) and utility charges.
(b) General or special taxes, including, but not limited to, property taxes, sales taxes, parcel taxes, transient occupancy taxes, business taxes, which may be applied to the Property or to businesses occupying the Property; provided that (i) the tax is of general applicability City-wide and does not burden the Property disproportionately to other similar 25 developments within the City; and (ii) the tax is not a levy, assessment, fee or tax imposed for the purpose of funding public or private improvements on other property located within the Downtown Community Plan area as of the Effective Date.
(c) Procedural regulations relating to hearing bodies, petitions, applications, notices, documentation of findings, records, manner in which hearings are conducted, reports, recommendations, initiation of appeals, and any other matters of procedure; provided such regulations are uniformly imposed by the City on all matters, do not result in any unreasonable decision-making delays and do not affect the substantive findings by the City in approving this Agreement or as otherwise established in this Agreement. (d) Regulations governing construction standards and specifications which are of general application that establish standards for the construction and installation of structures and associated improvements, including, without limitation, the City’s Building Code, Plumbing Code, Mechanical Code, Electrical Code and Fire Code; provided that such construction standards and specifications are applied on a City-wide basis and do not otherwise limit or impair the Digital Display approvals granted in this Agreement unless adopted to meet (i) health and safety concerns or (ii) in the event of replacement of the Digital Display during the Term, City-wide green building or energy standards clearly applicable to electronic digital displays.
(e) Any City regulations to which Owner has consented in writing, which consent may be withheld by Owner in its sole discretion. (f) Collection of such fees or exactions as are imposed and set by governmental entities not controlled by City but which are required to be collected by City. (g) Wastewater/water connection fees, including capital facility and construction fees, which are adopted by the City Council from time to time and apply generally throughout the City.
(h) Regulations which do not impair the rights and approvals granted to Owner under this Agreement. For the purposes of this Section 5.2.1(h), regulations which impair Owner’s rights or approvals include, but are not limited to, regulations which (i) materially increase the cost of the Digital Display (except as provided in Section 5.2.1(a), (b), and (d) above), (ii) materially delay development of the Digital Display or would cause a material change in the uses of the Digital Display as provided in this Agreement, or (iii) materially impair the development, operation or use of the Digital Display. (i) Generally applicable codes or actions necessary to comply with a declaration of a Water Shortage Emergency pursuant to the California Water Code.

5.2.2 New Rules and Regulations. This Agreement shall not be construed to prevent the City from applying new rules, regulations and policies in those circumstances specified in Government Code Section 65866.

5.2.3 State or Federal Laws. In the event that state or federal laws or regulations, enacted after the Effective Date, prevent or preclude compliance with one or more of 26 the provisions of this Agreement, such provisions of this Agreement shall be modified or suspended as may be necessary to comply with such state or federal laws or regulations; provided that 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.

5.3 Common Set of Existing Regulations. Prior to the Effective Date, the City and Owner shall use reasonable efforts to identify, assemble and copy three identical sets of the Existing Regulations, to be retained by the City and Owner, so that if it becomes necessary in the future to refer to any of the Existing Regulations, there will be a common set of the Existing Regulations available to all Parties.

5.4 Conflicting Enactments. Except as provided in Section 5.2 above, any Subsequent Code Change which would conflict in any way with or be more restrictive than the Existing Regulations shall not be applied by the City to any portion of the Digital Display.

Owner may, in its sole discretion, give the City written notice of its election to have any Subsequent Code Change applied to any portion of the Digital Display as it may have an interest in, in which case such Subsequent Code Change shall be deemed to be an Existing Regulation insofar as that portion of the Digital Display is concerned. If there is any conflict or inconsistency between the terms and conditions of this Agreement and the Existing Regulations, the terms and conditions of this Agreement shall control.

5.5 Timing of Development. The California Supreme Court held in Pardee Construction Co. v. City of Camarillo, 37 Cal.3d 465 (1984), that failure of the parties in that case to provide for the timing of development resulted in a later adopted initiative restricting the timing of development to prevail over the parties’ agreement. It is the intent of Owner and the City to cure that deficiency by expressly acknowledging and providing that any Subsequent Code Change that purports to limit the installation and/or operation of the Digital Display shall not prevail over this Agreement.

ARTICLE 6

DESIGN APPROVAL
Notwithstanding any provision of the SMMC or any interim zoning ordinance to the contrary, the Digital Display District Ordinance shall set forth the design approval required, if any, for the Digital Display’s design, colors, and/or materials.

ARTICLE 7

CITY TECHNICAL PERMITS

7.1 Definitions. For purposes of this Agreement, the following terms shall have the meanings set forth below:

7.1.1 “Technical City Permits” means any Ministerial Approvals, consents or permits from the City or any office, board, commission, department, division or agency of the 27 City, which are necessary for the actual construction of the Digital Display or any portion thereof in accordance with the Digital Display Plans and this Agreement. Technical City Permits include, without limitation (a) building permits, (b) related mechanical, electrical, plumbing and other technical permits, (c) demolition, excavation and grading permits, (d) encroachment permits, (e) off-site improvement permits, and (f) temporary and final certificates of occupancy.

7.1.2 “Technical Permit Applications” means any applications required to be filed by Owner for any Technical City Permits.

7.2 Diligent Action by City.

7.2.1 Upon satisfaction of the conditions set forth in Section 7.3, the City shall accept the Technical Permit Applications filed by Owner with the City and shall diligently proceed to process such Technical Permit Applications to completion.

7.2.2 Upon satisfaction of the conditions set forth in Section 7.3, the City shall diligently issue the Technical City Permits which are the subject of the Technical Permit Applications.

7.3 Conditions for Diligent Action by the City.

7.3.1 Acceptance and Processing of Technical Permit Applications. The obligation of the City to accept and diligently process the Technical Permit Applications which are filed by Owner for the Digital Display, and then issue the Technical City Permits for the Digital Display, is subject to the satisfaction of the following conditions:
(a) Owner shall have completed and filed all Technical Permit Applications which are required under the administrative procedures and policies of the City which are in effect on the date when the Technical Permit Application is filed; provided that such procedures and policies are uniformly in force and effect throughout the City; and (b) Owner shall have paid all processing and permit fees established by the City in connection with the filing and processing of any Technical Permit Application which are in effect on the date when the Technical Permit Application is filed; provided that such fees are uniformly in force and effect throughout the City.

7.3.2 Issuance of a Technical City Permit. The obligation of the City to issue a Technical City Permit for the Digital Display which is the subject of a Technical Permit Application filed by Owner is subject to the satisfaction of the following conditions (and only such conditions and no others):
(a) Owner shall have complied with all of its obligations under this Agreement, including those in Exhibit “D”, which are required to be performed prior to or concurrent with the issuance of the Technical City Permits for the proposed Digital Display; (b) Owner shall have received any permits or approvals from other governmental agencies which are required by law to be issued prior to or concurrent with the 28 issuance of the Technical City Permits for the proposed Digital Display or offsite improvements, as applicable;
(c) The proposed Digital Display conforms to the development standards for such Digital Display established in this Agreement. In the event that a proposed Digital Display is not in conformance with the development standards, Owner shall have the right to seek any relief from such standards under the procedures then available in the City; and (d) The proposed Digital Display or offsite improvements, as applicable, conforms to the Administrative and Technical Construction Codes of the City (Article VIII of the SMMC) (the “Technical Codes”) in effect on the date that the Technical Permit Application is filed.

7.3.3 New Technical Requirements. From time to time, the City’s Technical Codes may be amended to meet new technical requirements related to techniques of building and construction/installation of digital displays. If the sole means of achieving compliance for the Digital Display with such revisions to the Technical Codes made after the Effective Date (“New Technical Requirements”) would require an increase from the allowable Projections from Buildings into Minimum Setbacks or Height Projections established in this Agreement for the Digital Display, then the Community Development Director is hereby authorized to grant Owner limited relief from the allowable Projections from Buildings into Minimum Setbacks or Height Projections without amending this Agreement if the requested relief is in compliance with the City’s General Plan. Any such approval shall be granted only after the Community Development Director’s receipt of a written request for such relief from Owner. Owner is required to supply the Community Development Director with written documentation of the fact that compliance with the New Technical Requirements cannot be achieved by some other method. Any such relief shall only be granted to the extent necessary in the Community Development Director’s determination for Owner to comply with the New Technical Requirements.

7.4 Duration of Technical City Permits. The duration of Technical City Permits issued by the City for the Digital Display, and any extensions of the time period during which such Technical City Permits remain valid, shall be established in accordance with the Technical Codes in effect at the time that the Technical City Permits are issued. Subject to Section 3.4, the lapse or expiration of a Technical City Permit shall not preclude or impair Owner from subsequently filing another Technical Permit Application for the same matter during the Term of this Agreement, which shall be processed by the City in accordance with the provisions of this Article 7. Notwithstanding anything to the contrary in this Agreement, if Owner obtains building permits for the Digital Display and, at any time after the Outside Building Permit Issuance Date, such building permits expire or are revoked pursuant to the applicable terms of the SMMC (as the same may be amended from time to time), then Owner may not subsequently apply for new building permits for the Digital Display without first obtaining the prior written consent of the Community Development Director, which may be granted or withheld in the Community Development Director’s sole discretion.
29 ARTICLE 8

AMENDMENT AND MODIFICATION

8.1 Amendment and Modification of Development Agreement. Except as provided in Section 2.4.2, subject to the notice and hearing requirements of the applicable Development Agreement Statutes, this Agreement may be modified or amended from time to time only with the written consent of Owner and the City or their successors and assigns in accordance with the provisions of the SMMC and Section 65868 of the California Government Code.

ARTICLE 9
TERM

9.1 Effective Date. This Agreement shall be dated, and the obligations of the Parties hereunder shall be effective as of the date upon which both (i) the Digital Display District Ordinance and (ii) the ordinance approving this Agreement becomes effective (the “Effective Date”). The Parties shall execute this Agreement within ten (10) Business Days of the Effective Date.

9.2 Term.

9.2.1 Term of Agreement. The term of this Agreement shall commence on the Effective Date and shall continue for thirty (30) years thereafter (the “Term”), unless the Term is otherwise terminated pursuant to Section 11.4, after the satisfaction of all applicable public hearing and related procedural requirements, or pursuant to Section 3.3 or Section 9.2.2.

Notwithstanding the foregoing, if the approval by the California Coastal Commission of the Digital Display does not occur within six (6) months of the submittal by Owner of the Digital Display to the Coastal Commission, then the Term shall automatically be extended one month for each additional month or partial month greater than six (6) months that the Coastal Commission approval is delayed; provided, however, that Owner is diligently pursuing Coastal Commission approval. Nothing in this Section 9.2.1 modifies any tolling of the Term provided for in other sections of this Agreement, including Section 3.6(ii).

9.2.2 Early Removal and Termination. At or after three (3) years after the Digital Display Commencement Date, Owner may, at its sole discretion, remove the Digital Display. Prior to removal of the Digital Display, Owner shall provide the City with at least one hundred twenty (120) Days notice of its election to remove the Digital Display and terminate this Agreement. Such notice shall specify the date Owner intends to remove the Digital Display (the “Early Termination Date”). Upon Owner’s removal of the Digital Display in accordance with Section 2.7 and payment of any outstanding Ongoing Community Benefit Contribution accrued through the Early Termination Date plus an early termination fee in the amount of Two Hundred and Fifty Thousand Dollars ($250,000) (the “Early Termination Fee”), this Agreement shall automatically terminate.
30 9.2.3 Termination Certificate. Upon termination of this Agreement, the Parties hereto shall execute an appropriate certificate of termination in recordable form (a “Termination Certificate”), which shall be recorded in the official records of Los Angeles County.

9.2.4 Effect of Termination. Except as expressly provided herein, none of the Parties' respective rights and obligations under this Agreement shall survive the Term.

9.2.5 Extensions Available. Prior to its expiration, the Term of this Agreement may be extended for up to two (2) – ten (10) year extensions without the necessity of filing and processing an application to amend this Agreement; provided, however, that (i) each such extension shall be subject to the mutual agreement the Owner and City Manager, each acting in their sole discretion, and shall, upon mutual agreement, be memorialized in the form of an amendment to this Agreement; and (ii) Owner provides documentation of a current leasing or licensing contract between Owner and a billboard operator to evidence continuing use of the Digital Display beyond the original Term, as extended by any authorized extension. Owner understands, acknowledges, and agrees that such amendment to be negotiated may include revisions to this Agreement, including, without limitation, Section 2.5.

ARTICLE 10

PERIODIC REVIEW OF COMPLIANCE

10.1 City Review. The City shall review compliance with this Agreement once each year, on or before March 31st (each, a “Periodic Review”), in accordance with this Article 10 in order to determine whether or not Owner is out-of-compliance with any specific term or provision of this Agreement.

10.2 Evidence of Reasonable Good Faith Compliance. On or before October 1st of each year, Owner shall deliver to the City a written report demonstrating that Owner has been in reasonable good faith compliance with this Agreement during the twelve (12) month period prior to the anniversary of the Effective Date. The written report shall be provided in the form established by the City at the time of the first annual report, if any, which form shall not change materially thereafter without Owner’s consent. For purposes of this Agreement, the phrase “reasonable good faith compliance” shall mean the following: (a) compliance by Owner with the requirements of the Existing Regulations, except as otherwise modified by this Agreement; and (b) compliance by Owner with the terms and conditions of this Agreement, subject to the existence of any specified Excusable Delays (as defined in Section 15.8 below) which prevented or delayed the timely performance by Owner of any of its obligations under this Agreement.

Without limiting the generality of the foregoing, demonstration of reasonable good faith compliance shall mean Owner’s satisfaction of requirements under Section 2.5.2 at the time that the report is submitted.

10.3 Information to be Provided to Owner. Prior to any public hearing concerning the Periodic Review of this Agreement, the City shall deliver to Owner a copy of all staff reports prepared in connection with a Periodic Review, written comments from the public and, to the 31 extent practical, all related exhibits concerning such Periodic Review. If the City delivers to Owner a Notice of Breach pursuant to Section 11.1 below, the City shall concurrently deliver to Owner a copy of all staff reports prepared in connection with such Notice of Breach, all written comments from the public, and all related exhibits concerning such Notice of Breach.

10.4 Notice of Breach; Cure Rights. If during any Periodic Review, the City reasonably concludes on the basis of substantial evidence that Owner has not demonstrated that it is in reasonable good faith compliance with this Agreement, then the City may issue and deliver to Owner a written Notice of Breach pursuant to Section 11.1 below, and Owner shall have the opportunity to cure the default identified in the Notice of Breach during the cure periods and in the manner provided by Section 11.2 and Section 11.3, as applicable.

10.5 Failure of Periodic Review. The City’s failure to review at least annually compliance by Owner with the terms and conditions of this Agreement shall not constitute or be asserted by any Party as a breach by any other Party of this Agreement.

10.6 Termination of Development Agreement. If Owner fails to timely cure any material item(s) of non-compliance set forth in a Notice of Breach, then the City shall have the right but not the obligation to initiate proceedings for the purpose of terminating this Agreement pursuant to Section 11.4 below.

10.7 City Cost Recovery. Following completion of each Periodic Review, Owner shall reimburse the City for its actual and reasonable costs incurred in connection with such review after provision of a reasonably detailed invoice by the City.

ARTICLE 11

DEFAULT

11.1 Notice and Cure.

11.1.1 Breach. If either Party fails to substantially perform any term, covenant or condition of this Agreement which is required on its part to be performed (a “Breach” or “Default”), the non-defaulting Party shall have those rights and remedies provided in this Agreement; provided that such non-defaulting Party has first sent a written notice of Breach (a “Notice of Breach”), in the manner required by Section 15.1, specifying the precise nature of the alleged Breach (including references to pertinent Sections of this Agreement and the Existing Regulations or Subsequent Code Changes alleged to have been breached), and the manner in which the alleged Breach may satisfactorily be cured. If the City alleges a Breach by Owner, the City shall also deliver a copy of the Notice of Breach to any Secured Lender of Owner which has delivered a Request for Notice to the City in accordance with Article 12.

11.1.2 Monetary Breach. In the case of a monetary Breach by Owner, Owner shall promptly commence to cure the identified Breach and shall complete the cure of such Breach within sixty (60) Days after receipt by Owner of the Notice of Breach; provided that if such monetary Breach is the result of an Excusable Delay or the cure of the same is delayed as a 32 result of an Excusable Delay, Owner shall deliver to the City reasonable evidence of the Excusable Delay.

11.1.3 Non-Monetary Breach. In the case of a non-monetary Breach by either Party, the alleged defaulting Party shall promptly commence to cure the identified Breach and shall diligently prosecute such cure to completion; provided that the defaulting Party shall complete such cure within thirty (30) Days after receipt of the Notice of Breach or provide evidence of Excusable Delay that prevents or delays the completion of such cure. The thirty (30) day cure period for a non-monetary Breach shall be extended as is reasonably necessary to remedy such Breach; provided that the alleged defaulting Party commences such cure promptly after receiving the Notice of Breach and continuously and diligently pursues such remedy at all times until such Breach is cured.

11.1.4 Excusable Delay. Notwithstanding anything to the contrary contained in this Agreement, the City’s exercise of any of its rights or remedies under this Article 11 shall be subject to the provisions regarding Excusable Delay in Section 15.8 below.

11.2 Remedies for Monetary Default. If there is a Breach by Owner in the performance of any of its monetary obligations under this Agreement which remains uncured (a) sixty (60) Days after receipt by Owner of a Notice of Breach from the City and (b) after expiration of Secured Lender’s Cure Period under Section 12.1 (if a Secured Lender of Owner has delivered a Request for Notice to the City in accordance with Section 12.1), then an “Event of Monetary Default” shall have occurred by Owner and the City shall have available any right or remedy provided in this Agreement, at law or in equity. All of said remedies shall be cumulative and not exclusive of one another, and the exercise of any one or more of said remedies shall not constitute a waiver or election in respect to any other available remedy.

11.3 Remedies for Non-Monetary Default.

11.3.1 Remedies of Parties. If any Party receives a Notice of Breach from the other Party regarding a non-monetary Breach, and the non-monetary Breach remains uncured:
(a) after expiration of all applicable notice and cure periods, and (b) in the case of a Breach by Owner, after the expiration of Secured Lender’s Cure Period under Section 12.1 (if a Secured Lender of Owner has delivered a Request for Notice to the City in accordance with Section

12.1), then an “Event of Non-Monetary Default” shall have occurred and the non-defaulting Party shall have available any right or remedy provided in this Agreement, or provided at law or in equity except as prohibited by this Agreement. All of said remedies shall be cumulative and not exclusive of one another, and the exercise of any one or more of said remedies shall not constitute a waiver or election in respect to any other available remedy.

11.3.2 Specific Performance. The City and Owner acknowledge that monetary damages and remedies at law generally are inadequate and that specific performance is an appropriate remedy for the enforcement of this Agreement. Therefore, unless otherwise expressly provided herein, the remedy of specific performance shall be available to the nondefaulting party if the other Party causes an Event of Non-Monetary Default to occur. 33 11.3.3 Writ of Mandate. The City and Owner hereby stipulate that Owner shall be entitled to obtain relief in the form of a writ of mandate in accordance with Code of Civil Procedure Section 1085 or Section 1094.5, as appropriate, to remedy any Event of NonMonetary Default by the City of its obligations and duties under this Agreement. Nothing in this Section 11.3.3, however, is intended to alter the evidentiary standard or the standard of review applicable to any action of, or approval by, the City pursuant to this Agreement or with respect to the Digital Display.

11.3.4 No Damages Relief Against City. It is acknowledged by Owner that the City would not have entered into this Agreement if the City were to be liable in damages under or with respect to this Agreement or the application thereof. Consequently, and except for the payment of attorneys’ fees and court costs, the City shall not be liable in damages to Owner, and Owner covenants on behalf of itself and its successors in interest not to sue for or claim any damages:
(a) for any default under this Agreement;
(b) for the regulatory taking, impairment or restriction of any right or interest conveyed or provided hereunder or pursuant hereto; or (c) arising out of or connected with any dispute, controversy or issue regarding the application or interpretation or effect of the provisions of this Agreement.

The City and Owner agree that the provisions of this Section 11.3.4 do not apply for damages which:
(a) do not arise under this Agreement;
(b) are not with respect to any right or interest conveyed or provided under this Agreement or pursuant to this Agreement; or
(c) do not arise out of or which are not connected to any dispute, controversy, or issue regarding the application, interpretation, or effect of the provisions of this Agreement or the application of any City rules, regulations, or official policies.

11.3.5 Enforcement by the City. The City, at its discretion, shall be entitled to apply the remedies set forth in Chapters 1.09 and 1.10 of the SMMC as the same may be amended from time to time and shall follow the notice procedures of Chapter 1.09 and 1.10 respectively in lieu of Section 11.1 of this Agreement if these remedies are applied.

11.3.6 No Damages Against Owner. It is acknowledged by the City that Owner would not have entered into this Agreement if Owner were to be liable in damages in connection with any non-monetary default hereunder. Consequently, and except for the payment of attorneys’ fees and court costs, Owner shall not be liable in damages to the City for any nonmonetary default, and the City covenants on behalf of itself not to sue for or claim any damages:
(a) for any non-monetary default hereunder or;
34 (b) arising out of or connected with any dispute, controversy or issue regarding the application or interpretation or effect of the provisions of this Agreement.

The City and Owner agree that the provisions of this Section 11.3.6 do not apply for damages which:
(a) are for a monetary default; or
(b) do not arise out of or which are not connected with any dispute, controversy or issue regarding the application, interpretation, or effect of the provisions of this Agreement to or the application of any City rules, regulations, or official policies; or (c) constitute Damages which arise under Section 14.1.

11.3.7 No Damages Against City. It is acknowledged by the Owner that City would not have entered into this Agreement if City were to be liable for damages in connection with any non-monetary default hereunder. Consequently, and except for the payment of attorneys’ fees and court costs, City shall not be liable in damages to the Owner for any nonmonetary default, and the Owner covenants on behalf of itself not to sue for or claim any damages.

11.3.8 No Other Limitations. Except as expressly set forth in this Section 11.3, the provisions of this Section 11.3 shall not otherwise limit any other rights, remedies, or causes of action that either the City or Owner may have at law or equity after the occurrence of any Event of Non-Monetary Default.

11.4 Modification or Termination of Agreement by City.

11.4.1 Default by Owner. If Owner causes either an Event of Monetary Default or an Event of Non-Monetary Default, then the City may commence proceedings to modify or terminate this Agreement pursuant to this Section 11.4.

11.4.2 Procedure for Modification or Termination. The procedures for modification or termination of this Agreement by the City for the grounds set forth in Section

11.4.1 are as follows:
(a) The City shall provide a written notice to Owner (and to any Secured Lender of Owner which has delivered a Request for Notice to the City in accordance with Section 12.1) of its intention to modify or terminate this Agreement unless Owner (or the Secured Lender) cures or corrects the acts or omissions that constitute the basis of such determinations by the City (a “Hearing Notice”). The Hearing Notice shall be delivered by the City to Owner in accordance with Section 15.1 and shall contain the time and place of a public hearing to be held by the City Council on the determination of the City to proceed with modification or termination of this Agreement. The public hearing shall not be held earlier than:
(i) thirty-one (31) Days after delivery of the Hearing Notice to Owner or (ii) if a Secured Lender has delivered a Request for Notice in accordance with Section 12.1, the day following the expiration of the “Secured Lender Cure Period” (as defined in Section 12.1). 35 (b) If, following the conclusion of the public hearing, the City Council: (i) determines that an Event of Non-Monetary Default has occurred or the Owner has not been in reasonable good faith compliance with this Agreement pursuant to Section 10.1, and (ii) further determines that Owner (or the Secured Lender, if applicable) has not cured (within the applicable cure periods) the acts or omissions that constitute the basis of the determination under clause (i) above or if those acts or omissions could not be reasonably remedied prior to the public hearing that Owner (or the Secured Lender) has not in reasonable good faith commenced to cure or correct such acts or omissions prior to the public hearing or is not diligently and continuously proceeding therewith to completion, then upon making such conclusions, the City Council may modify or terminate this Agreement. The City cannot unilaterally modify the provisions of this Agreement pursuant to this Section 11.4. Any such modification requires the written consent of Owner. If the City Council does not terminate this Agreement, but proposes a modification to this Agreement as a result of the public hearing and Owner does not (within five (5) Business Days of receipt) execute and deliver to the City the form of modification of this Agreement submitted to Owner by the City, then the City Council may elect to terminate this Agreement at any time after the sixth day after Owner’s receipt of such proposed modification.

11.5 Cessation of Rights and Obligations. If this Agreement is terminated by the City pursuant to and in accordance with Section 11.4, the rights, duties and obligations of the Parties under this Agreement shall cease as of the date of such termination, except only for those rights and obligations that expressly survive the termination of this Agreement. In such event, any and all benefits, including money received by the City prior to the date of termination, shall be retained by the City.

11.6 Completion of Improvements. Notwithstanding the provisions of Sections 11.2,

11.3, 11.4, and 11.5, if prior to termination of this Agreement, Owner has performed substantial work and incurred substantial liabilities in reasonable good faith reliance upon a building permit issued by the City, then Owner shall have acquired a vested right to (a) complete construction of the Digital Display in accordance with the terms of the building permit and this Agreement, subject to its continuing obligations with respect to all outstanding project and community benefits (Section 2.5) and, (b) use and maintain such Digital Display upon completion for the purposes provided in this Agreement. Any Digital Display completed pursuant to this Section

11.6 shall be considered legal non-conforming subject to all City ordinances standards and policies as they then exist governing legal non-conforming signs/digital displays and associated structures unless the Digital Display otherwise complies with the development standards for signs/digital displays the district in which it is located and the signs/digital display is otherwise permitted or conditionally permitted in the district.

ARTICLE 12

MORTGAGEES

12.1 Encumbrances on the Property. This Agreement shall not prevent or limit Owner (in its sole discretion), from encumbering the Property (in any manner) or any portion thereof or any improvement thereon by any mortgage, deed of trust, assignment of rents or other security device securing financing with respect to the Property (a “Mortgage”). Each mortgagee of a mortgage or a beneficiary of a deed of trust (each, a “Secured Lender”) on the Property shall be 36 entitled to the rights and privileges set forth in this Article 12. Any Secured Lender may require from the City certain interpretations of this Agreement. The City shall from time to time, upon request made by Owner, meet with Owner and representatives of each of its Secured Lenders to negotiate in reasonable good faith any Secured Lender’s request for interpretation of any part of this Agreement. The City will not unreasonably withhold, condition or delay the delivery to a Secured Lender of the City’s written response to any such requested interpretation.

12.1.1 Mortgage Not Rendered Invalid. Except as provided in Section 12.1.2, neither entering into this Agreement nor a Breach of this Agreement, nor any Event of Monetary Default nor any Event of Non-Monetary Default shall defeat, render invalid, diminish, or impair the lien of any Mortgage made in reasonable good faith and for value.

12.1.2 Priority of Agreement. This Agreement shall be superior and senior to the lien of any Mortgage. Any acquisition or acceptance of title or any right or interest in or with respect to the Property or any portion thereof by a Secured Lender or its successor in interest (whether pursuant to foreclosure, trustee’s sale, deed in lieu of foreclosure, lease termination or otherwise) shall be subject to all of the terms and conditions of this Agreement, including any monetary payments owed to City under this Agreement.

12.1.3 Right of Secured Lender to Cure Default.
(a) A Secured Lender may give notice to the City, specifying the name and address of such Secured Lender and attaching thereto a true and complete copy of the Mortgage held by such Secured Lender, specifying the portion of the Property that is encumbered by the Secured Lender’s lien (a “Request for Notice”). If the Request for Notice has been given, at the same time the City sends to Owner any Notice of Breach or Hearing Notice under this Agreement, then if such Notice of Breach or Hearing Notice affects the portion of the Property encumbered by the Secured Lender’s lien, the City shall send to such Secured Lender a copy of each such Notice of Breach and each such Hearing Notice from the City to Owner. The copy of the Notice of Breach or the Hearing Notice sent to the Secured Lender pursuant to this Section 12.1.3(a) shall be addressed to such Secured Lender at its address last furnished to the City. The period within which a Secured Lender may cure a particular Event of Monetary Default or Event of Non-Monetary Default shall not commence until three Business Days after the City has sent to the Secured Lender such copy of the applicable Notice of Breach or Hearing Notice.
(b) After a Secured Lender has received a copy of such Notice of Breach or Hearing Notice, such Secured Lender shall thereafter have a period of time (in addition to any notice and/or cure period afforded to Owner under this Agreement) equal to: (a) twenty (20) Days in the case of any Event of Monetary Default and (b) thirty (30) Days in the case of any Event of Non-Monetary Default, during which period the Secured Lender may provide a remedy or cure of the applicable Event of Monetary Default or may provide a remedy or cure of the applicable Event of Non-Monetary Default; provided that if the cure of the Event of Non-Monetary Default cannot reasonably be completed within thirty Days, Secured Lender may, within such 30-day period, commence to cure the same and thereafter diligently prosecute such cure to completion (a “Secured Lender’s Cure Period”). If Owner has caused an Event of Monetary Default or an Event of Non-Monetary Default, then each Secured Lender shall have 37 the right to remedy such Event of Monetary Default or an Event of Non-Monetary Default, as applicable, or to cause the same to be remedied prior to the conclusion of the Secured Lender’s Cure Period and otherwise as herein provided. The City shall accept performance by any Secured Lender of any covenant, condition, or agreement on Owner’s part to be performed hereunder with the same force and effect as though performed by Owner. (c) The period of time given to the Secured Lender to cure any Event of Monetary Default or an Event of Non-Monetary Default by Owner which reasonably requires that said Secured Lender be in possession of the Property to do so, shall be deemed extended to include the period of time reasonably required by said Secured Lender to obtain such possession (by foreclosure, the appointment of a receiver or otherwise) promptly and with due diligence; provided that during such period all other obligations of Owner under this Agreement, including, without limitation, payment of all amounts due, are being duly and promptly performed.

12.1.4 Secured Lender Not Obligated Under this Agreement. (a) No Secured Lender shall have any obligation or duty under this Agreement to perform the obligations of Owner’s or the affirmative covenants of Owner’s hereunder or to guarantee such performance unless and until such time as a Secured Lender takes possession or becomes the owner of the estate covered by its Mortgage. If the Secured Lender takes possession or becomes the owner of any portion of the Property, then from and after that date, the Secured Lender shall be obligated to comply with all provisions of this Agreement, including payment of any outstanding monetary obligations of Owner owed to City prior to the date the Secured Lender became the fee owner of the Property. (b) Nothing in Section 12.1.4(a) is intended, nor should be construed or applied, to limit or restrict in any way the City’s authority to terminate this Agreement, as against any Secured Lender as well as against Owner if any curable Event of Monetary Default or an Event of Non-Monetary Default is not completely cured within the Secured Lender’s Cure Period.

ARTICLE 13

TRANSFERS AND ASSIGNMENTS

13.1 Transfers and Assignments.

13.1.1 Not Severable from Ownership Interest in Property. This Agreement shall not be severable from Owner’s interest in the Property and any transfer of the Property or any portion thereof, shall automatically operate to transfer the benefits and burdens of this Agreement with respect to the transferred Property or transferred portions, as applicable.

13.1.2 Transfer Rights. Owner may freely sell, ground lease, transfer, exchange, hypothecate, encumber or otherwise dispose of its interest in the Property (collectively referenced herein as “Transfer”), without the consent of the City. Owner shall, however, give written notice to the City, in accordance with Section 15.1, of any transfer of the Property, 38 disclosing in such notice (a) the identity of the transferee of the Property (the “Property Transferee”) and (b) the address of the Property Transferee as applicable.

13.2 Release Upon Transfer. Upon Transfer of the rights and interests of Owner to the Property, Owner shall be released from its obligations under this Agreement to the extent of Transfer with respect to the Property if: (a) Owner has provided written notice of such Transfer to City; and (b) the Property Transferee executes and delivers to City a written agreement in which the Property Transferee expressly and unconditionally assumes all of the obligations of Owner under this Agreement with respect to the Property in the form of Exhibit “F” attached hereto (the “Assumption Agreement”). Upon such Transfer of the Property and the express assumption of Owner’s obligations under this Agreement by the Property Transferee, the City agrees to look solely to the Property Transferee for compliance with the provisions of this Agreement. Any such Property Transferee shall be entitled to the benefits of this Agreement as “Owner” hereunder and shall be subject to the obligations of this Agreement. Failure to deliver a written Assumption Agreement hereunder shall not affect the transfer of the benefits and burdens as provided in Section 13.1, provided that the transferor shall not be released from its obligations hereunder unless and until the executed Assumption Agreement is delivered to the City.

ARTICLE 14

INDEMNITY TO CITY

14.1 Indemnity. Owner agrees to and shall defend, indemnify and hold harmless the City, its City Council, boards and commissions, officers, agents, employees, volunteers and other representatives (collectively referred to as “City Indemnified Parties”) from and against any and all loss, liability, damages, cost, expense, claims, demands, suits, attorney’s fees and judgments (collectively referred to as “Damages”), including but not limited to claims for damage for personal injury (including death) and claims for property damage arising directly or indirectly from the following: (1) for any act or omission of Owner or of its officers, board members, agents, employees, volunteers, contractors, subcontractors or other persons acting on its behalf, including Owner’s tenants and/or Operator (collectively referred to as the “Owner Parties”) which occurs during the Term and relates to this Agreement; and (2) for any act or omission related to the operations of Owner Parties. Owner’s obligation to defend, indemnify and hold harmless applies to all actions and omissions of Owner Parties as described above caused or alleged to have been caused in connection with the Digital Display or this Agreement, except to the extent any Damages are caused by the negligence or willful misconduct of any City Indemnified Parties or any content provided by the City for display on the Digital Display. This Section 14.1 applies to all Damages suffered or alleged to have been suffered by the City Indemnified Parties regardless of whether or not the City prepared, supplied or approved plans or specifications or both for the Digital Display. The provisions of this Section shall survive the termination of the Agreement.

14.2 City’s Right to Defense. The City shall have the right to approve legal counsel retained by Owner to defend any claim, action or proceeding which Owner is obligated to defend pursuant to Section 14.1, which approval shall not be unreasonably withheld, conditioned or delayed. If any conflict of interest results during the mutual representation of the City and Owner in defense of any such action, or if the City is reasonably dissatisfied with legal counsel 39 retained by Owner, the City shall have the right, at Owner’s cost and expense, (a) to have the City Attorney undertake and continue the City’s defense, or (b) with Owner’s approval, which shall not be reasonably withheld or delayed, to select separate outside legal counsel to undertake and continue the City’s defense.

ARTICLE 15

GENERAL PROVISIONS

15.1 Notices. Formal notices, demands and communications between the Parties shall be deemed sufficiently given if delivered to the principal offices of the City or Owner, as applicable, by (i) personal service, or (ii) express mail, Federal Express, or other similar overnight mail or courier service, regularly providing proof of delivery, or (iii) certified mail, postage prepaid, return receipt requested. Such notice shall be addressed as follows:

To City:

City of Santa Monica
1685 Main Street, Room 204
Santa Monica, CA 90401
Attention: City Manager
With a copy to:

City of Santa Monica
1685 Main Street, Mail Stop 28
Santa Monica, CA 90401
Attn: Community Development Department Director
To Owner:

UNITED XYZ LLC
c/o XYZ.Rent – 1202 Third
2800 Olympic Blvd, Floor 1
Santa Monica, CA 90404
With a copy to:

Grant Carpenter
2800 Olympic Blvd, Floor 1
Santa Monica, CA 90404
Notice given in any other manner shall be effective when received by the addressee. Any Party may change the addresses for delivery of notices to such Party by delivering notice to the other Party in accordance with this provision.

15.2 Entire Agreement; Conflicts. This Agreement represents the entire agreement of the Parties. This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the Parties or their predecessors in interest with respect to all or any part of the subject matter hereof. Should any or all of the provisions of this Agreement be found to be in conflict with any other provision 40 or provisions found in the Existing Regulations, then the provisions of this Agreement shall prevail.

15.3 Binding Effect. The Parties intend that the provisions of this Agreement shall constitute covenants which shall run with the land comprising the Property during the Term for the benefit thereof and that the burdens and benefits thereof shall bind and inure to the benefit of all successors-in-interest to the Parties hereto in accordance with Article 13. Every Party who now or hereafter owns or acquires any right, title, or interest in or to any portion of the Digital Display during the Term is and shall be conclusively deemed to have consented and agreed to every provision contained herein, to the extent relevant to said right, title or interest, whether or not any reference to this Agreement is contained in the instrument by which such person acquired an interest in the Digital Display.

15.4 Agreement Not for Benefit of Third Parties. This Agreement is made and entered into for the sole protection and benefit of Owner and the City and their respective successors and assigns. No other person shall have any right of action based upon any provision of this Agreement.

15.5 No Partnership or Joint Venture. Nothing in this Agreement shall be deemed to create a partnership or joint venture between the City and Owner or to render either Party liable in any manner for the debts or obligations of the other.

15.6 Estoppel Certificates. Either Party and any Secured Lender may, at any time, and from time to time, deliver written notice to the other Party requesting such Party to certify in writing (each, an “Estoppel Certificate”): (a) that this Agreement is in full force and effect, (b) that this Agreement has not been amended or modified either orally or in writing, or if so amended, identifying the amendments, (c) whether or not, to the knowledge of the responding Party, the requesting Party is in Breach or claimed Breach in the performance of its obligations under this Agreement, and, if so, describing the nature and amount of any such Breach or claimed Breach, and (d) whether or not, to the knowledge of the responding Party, any event has occurred or failed to occur which, with the passage of time or the giving of notice, or both, would constitute an Event of Monetary Default or an Event of Non-Monetary Default and, if so, specifying each such event. A Party receiving a request for an Estoppel Certificate shall execute and return such Certificate within thirty (30) Days following the receipt of the request therefor.

If the party receiving the request hereunder does not execute and return the certificate in such 30- day period and if circumstances are such that the Party requesting the notice requires such notice as a matter of reasonable business necessity, the Party requesting the notice may seek a second request which conspicuously states “FAILURE TO EXECUTE THE REQUESTED ESTOPPEL CERTIFICATE WITHIN FIFTEEN (15) DAYS SHALL BE DEEMED WAIVER PURSUANT TO SECTIONS 15.6 AND 15.13 OF THE DEVELOPMENT AGREEMENT” and which sets forth the business necessity for a timely response to the estoppel request. If the Party receiving the second request fails to execute the Estoppel Certificate within such 15-day period, it shall be conclusively deemed that the Agreement is in full force and effect and has not been amended or modified orally or in writing, and that there are no uncured defaults under this Agreement or any events which, with passage of time of giving of notice, of both, would constitute a default under the Agreement. The City Manager shall have the right to execute any Estoppel Certificate requested by Owner under this Agreement. The City acknowledges that an Estoppel Certificate 41 may be relied upon by any Property Transferee, Secured Lender or other party. The Estoppel Certificate shall be provided in lieu of zoning compliance letters authorized pursuant to SMMC Section 9.38.020(E), or any successor thereto.

15.7 Time. Time is of the essence for each provision of this Agreement of which time is an element.

15.8 Excusable Delays.

15.8.1 In addition to any specific provisions of this Agreement, nonperformance by Owner of its obligations under this Agreement shall be excused when it has been prevented or delayed in such performance by reason of any act, event or condition beyond the reasonable control of Owner (collectively, “Excusable Delays”) for any of the following reasons:
(a) War, insurrection, walk-outs, riots, acts of terrorism, floods, pandemic, earthquakes, fires, casualties, acts of God, or similar grounds for excused performances;
(b) Governmental restrictions or moratoria imposed by the City or by other governmental entities or the enactment of conflicting State or Federal laws or regulations; (c) The imposition of injunctive relief, restraining orders, restrictions or moratoria by judicial decisions or by litigation, contesting the validity, or seeking the enforcement or clarification of, this Agreement, whether instituted by Owner, the City or any other person or entity, or the filing of a lawsuit by any Party arising out of this Agreement or any permit or approval Owner deems necessary or desirable for the implementation of the Digital Display;
(d) The institution of a referendum pursuant to Government Code Section 65867.5 or a similar public action seeking to in any way invalidate, alter, modify or amend the ordinance adopted by the City Council approving and implementing this Agreement; (e) Inability to secure necessary labor, materials or tools, due to strikes, lockouts, or similar labor disputes or due to a global pandemic; and/or (f) Failure of the City to timely perform its obligations hereunder, including its obligations under Section 7.2 above.

15.8.2 Under no circumstances shall the inability of Owner to secure financing be an Excusable Delay to the obligations of Owner except to the extent the inability to secure financing is directly associated with war, insurrection, walk-outs, riots, acts of terrorism, floods, pandemic, earthquakes, fires, casualties, acts of God or similar grounds beyond the control of Owner.

15.8.3 In order for an extension of time to be granted for any Excusable Delay, Owner must deliver to the City written notice of the commencement of the Excusable Delay within sixty (60) Days after the date on which Owner becomes aware of the existence of the 42 Excusable Delay. The extension of time for an Excusable Delay shall be for the actual period of the delay.

15.8.4 Nothing contained in this Section 15.8 is intended to modify the terms of either Section 5.1.2 or Section 5.5 of this Agreement.

15.9 Governing Law. This Agreement shall be governed exclusively by the provisions hereof and by the laws of the State of California, without regard to any choice of law provisions thereof.

15.10 Cooperation in Event of Legal Challenge to Agreement. If there is any court action or other proceeding initiated by a third-party that includes any challenge to the validity, enforceability or any term or provision of this Agreement, the City’s CEQA determination for the Digital Display, and/or any other City approvals contemplated by this Agreement, then Owner shall indemnify, hold harmless, pay all costs actually incurred, and provide defense in said action or proceeding, with counsel reasonably satisfactory to both the City and Owner. The City shall cooperate with Owner in any such defense as Owner may reasonably request.

15.11 Attorneys’ Fees. If any Party commences any action for the interpretation, enforcement, termination, cancellation or rescission of this Agreement or for specific performance for the Breach of this Agreement, the prevailing Party shall be entitled to its reasonable attorneys’ fees, litigation expenses and costs. Attorneys’ fees shall include attorneys’ fees on any appeal as well as any attorneys’ fees incurred in any post-judgment proceedings to collect or enforce the judgment. Such attorneys’ fees shall be paid whether or not such action is prosecuted to judgment. In any case where this Agreement provides that the City or Owner is entitled to recover attorneys’ fees from the other, the Party so entitled to recover shall be entitled to an amount equal to the fair market value of services provided by attorneys employed by it as well as any attorneys’ fees actually paid by it to third Parties. The fair market value of the legal services for public attorneys shall be determined by utilizing the prevailing billing rates of comparable private attorneys.

15.12 Recordation. Parties shall cause this Agreement to be recorded against title to the Property in the Official Records of the County of Los Angeles in accordance with California Government Code Section 65868.5. The cost, if any, of recording this Agreement shall be borne by Owner.

15.13 No Waiver. No waiver of any provision of this Agreement shall be effective unless in writing and signed by a duly authorized representative of the Party against whom enforcement of a waiver is sought and referring expressly to this Section 15.13. No delay or omission by either Party in exercising any right or power accruing upon non-compliance or failure to perform by the other Party under any of the provisions of this Agreement shall impair any such right or power or be construed to be a waiver thereof, except as expressly provided herein. No waiver by either Party of any of the covenants or conditions to be performed by the other Party shall be construed or deemed a waiver of any succeeding breach or nonperformance of the same or other covenants and conditions hereof of this Agreement.

15.14 Construction of this Agreement. The Parties agree that each Party and its legal 43 counsel have reviewed and revised this Agreement and that any rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not apply in the interpretation of this Agreement or any amendments or exhibits thereto.

15.15 Other Governmental Approvals. Owner may apply for such other permits and approvals as may be required for development of the Digital Display in accordance with this Agreement from other governmental or quasi-governmental agencies having jurisdiction over the Property including, without limitation, applying for approval by the California Coastal Commission. The City shall reasonably cooperate with Owner in its endeavors to obtain such permits and approvals.

15.15.1 Further Assurances; Covenant to Sign Documents. Each Party shall take all actions and do all things, and execute, with acknowledgment or affidavit, if required, any and all documents and writings, which may be necessary or proper to achieve the purposes and objectives of this Agreement.

15.15.2 Processing. Upon satisfactory completion by Owner of all required preliminary actions and payments of appropriate processing fees, if any, the City shall, subject to all legal requirements, promptly initiate, diligently process, and complete at the earliest possible time all required steps, and expeditiously act upon any approvals and permits necessary for the development by Owner of the Digital Display in accordance with this Agreement, including, but not limited to, the following:
(a) the processing of applications for and issuing of all Discretionary Approvals requiring the exercise of judgment and deliberation by City; (b) the holding of any required public hearings; and
(c) the processing of applications for and issuing of all City Technical Permits requiring the determination of conformance with the Existing Regulations.

15.15.3 No Revocation. The City shall not revoke or subsequently disapprove any approval or future approval for the Digital Display once issued by the City provided that the Digital Display is in accordance with such approval. Any revocation or subsequent disapproval by the City shall state in writing the reasons why the development of the Digital Display is not deemed to be in accordance with such approval and the suggested actions to be taken in order for approval to be granted.

15.15.4 Processing During Third Party Litigation. If any third party lawsuit is filed against the City or Owner relating to this Agreement, the City shall not delay or stop the development, processing or construction of the Digital Display, or issuance of the City Technical Permits, unless the third party obtains a court order preventing the activity. The City shall not stipulate to or fail to oppose the issuance of any such order. Notwithstanding the foregoing and without prejudice to the provisions of Section 15.8.1(c), after service on the City or Owner of the initial petition or complaint challenging this Agreement or the Digital Display, the Owner may apply to the Community Development Director for a tolling of the applicable deadlines for Owner to otherwise comply with this Agreement. The Community Development Director shall approve such tolling, consistent with the standard in Section 15.27, for up to five years during 44 the pendency of the litigation and shall provide Owner with notice of his or her decision on the tolling request within forty (40) Days of receiving Owner’s request.

15.15.5 State, Federal or Case Law. Where any state, federal or case law allows the City to exercise any discretion or take any act with respect to that law, the City shall, in an expeditious and timely manner, at the earliest possible time, (i) exercise its discretion in such a way as to be consistent with, and carry out the terms of, this Agreement and (ii) take such other actions as may be necessary to carry out in reasonable good faith the terms of this Agreement.

15.16 Jurisdiction and Venue. Any legal action or proceeding among the Parties arising out of this Agreement shall be instituted in the Superior Court of the County of Los Angeles, State of California, in any other appropriate court in that County, or in the Federal District Court in the Central District of California. The parties agree that venue exists in either court, and each party expressly waives any right to transfer to another venue. The parties further agree that either court will have personal jurisdiction over the parties to this Agreement.

15.17 Exhibits. The following exhibits which are part of this Agreement are attached hereto and each of which is incorporated herein by this reference as though set forth in full:

Exhibit “A” Legal Description of the Property
Exhibit “B” Digital Display Plans
Exhibit “C” SMMC Article 9 (Planning and Zoning)
Exhibit “D” Conditions of Approval
Exhibit “E” Permitted Fees and Exactions
Exhibit “F” Form of Assignment and Assumption Agreement Exhibit “G” Digital Display District Ordinance
Except as to the Digital Display Plans, which shall be treated in accordance with Section

2.1 above, the text of this Agreement shall prevail in the event that any inconsistencies exist between the Exhibits and the text of this Agreement.

15.18 Counterpart Signatures. The Parties may execute this Agreement on separate signature pages which, when attached hereto, shall constitute one complete Agreement.

15.19 Certificate of Performance. Upon the completion of the Digital Display or upon performance of this Agreement or its earlier revocation and termination, the City shall provide Owner, upon Owner’s request, with a statement (“Certificate of Performance”) evidencing said completion, termination or revocation and the release of Owner from further obligations hereunder, except for any further obligations which survive such completion, termination or revocation. The Certificate of Performance shall be signed by the appropriate agents of Owner and the City and shall be recorded against title to the Property in the official records of Los Angeles County, California. Such Certificate of Performance is not a notice of completion as referred to in California Civil Code Section 3093.

15.20 Interests of Owner. Owner represents to the City that, as of the Effective Date, it is the owner of the entire Property, subject to encumbrances, easements, covenants, conditions, 45 restrictions, and other matters of record.

15.21 Operating Memoranda. The provisions of this Agreement require a close degree of cooperation between the City and Owner. During the Term of this Agreement, clarifications to this Agreement and the Existing Regulations may be appropriate with respect to the details of performance of the City and Owner. If and when, from time to time, during the term of this Agreement, the City and Owner agree that such clarifications are necessary or appropriate, they shall effectuate such clarification through operating memoranda approved in writing by the City and Owner, which, after execution, shall be attached hereto and become part of this Agreement and the same may be further clarified from time to time as necessary with future written approval by the City and Owner. Operating memoranda are not intended to and cannot constitute an amendment to this Agreement but mere ministerial clarifications, therefore public notices and hearings shall not be required for any operating memorandum. The City Attorney shall be authorized, upon consultation with, and approval of, Owner, to determine whether a requested clarification may be effectuated pursuant to the execution and delivery of an operating memorandum or whether the requested clarification is of such character to constitute an amendment of this Agreement which requires compliance with the provisions of Section 8.1 above. The authority to enter into such operating memoranda is hereby delegated to the City Manager and the City Manager is hereby authorized to execute any operating memoranda hereunder without further action by the City Council.

15.22 Acknowledgments, Agreements and Assurance on the Part of Owner.

15.22.1 Owner’s Faithful Performance. The Parties acknowledge and agree that Owner’s faithful performance in developing the Digital Display on the Property and in constructing and installing certain public improvements pursuant to this Agreement and complying with the Existing Regulations will fulfill substantial public needs. The City acknowledges and agrees that there is good and valuable consideration to the City resulting from Owner’s assurances and faithful performance thereof and that same is in balance with the benefits conferred by the City on the Digital Display. The Parties further acknowledge and agree that the exchanged consideration hereunder is fair, just and reasonable. Owner acknowledges that the consideration is reasonably related to the type and extent of the impacts of the Digital Display on the community and the Property, and further acknowledges that the consideration is necessary to mitigate the direct and indirect impacts caused by Owner on the Property.

15.22.2 Obligations to be Non-Recourse. As a material element of this Agreement, and in partial consideration for Owner’s execution of this Agreement, the Parties each understand and agree that the City’s remedies for breach of the obligations of Owner under this Agreement shall be limited as described in Sections 11.2 through 11.4 above.

15.23 Waiver of Protest. Owner acknowledges and agrees that by executing this Agreement, Owner waives any and all claims and rights, if any, under Government Code Section 66020 to protest fees, dedications, reservations, or exactions required by this Agreement (hereinafter “exactions”), including the City’s right to request and receive the exaction pursuant to this Agreement, the total exaction amount if specified by the Agreement, and the formula for subsequently calculating exactions if the formula is established by the Existing Regulations.

Notwithstanding the above, if the amount of any exaction is not expressly set forth in this 46 Agreement, Owner reserves the right to protest the subsequent calculation of this amount.

15.24 Not a Public Dedication. Nothing in this Agreement shall be deemed to be a gift or dedication of the Property, or of the Digital Display, or any portion thereof, to the general public, for the general public, or for any public use or purpose whatsoever, it being the intention and understanding of the Parties that this Agreement be strictly limited to and for the purposes herein expressed for the installation, maintenance, and operation of the Digital Display as private property. Owner shall have the right to prevent or prohibit the use of the Property, or the Digital Display, or any portion thereof, including common areas and building and improvements located thereon, by any person for any purpose inimical to the development of the Digital Display, including without limitation to prevent any person or entity from obtaining or accruing any prescriptive or other right to use the Property or the Digital Display.

15.25 Other Agreements. The City acknowledges that certain additional agreements may be necessary to effectuate the intent of this Agreement and facilitate development of the Digital Display. The City Manager is hereby authorized to prepare, execute, and record those additional agreements.

15.26 Severability and Termination. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid or unenforceable, or if any provision of this Agreement is superseded or rendered unenforceable according to any law which becomes effective after the Effective Date, the remainder of this Agreement shall be effective to the extent the remaining provisions are not rendered impractical to perform, taking into consideration the purposes of this Agreement.

15.27 Community Development Director Approval. Whenever this Agreement requires Community Development Director review and approval, such review and approval shall be undertaken in reasonable good faith and with due diligence and shall not be unreasonably withheld, conditioned or delayed.

15.28 City Manager Approval. Whenever this Agreement requires City Manager review and approval, such review and approval shall not preclude the City Manager from consulting with the City Council before rendering an approval.

This Agreement is executed by the Parties on the date first set forth above and is made effective on and as of the Effective Date.

OWNER:

UNITED XYZ LLC,
a California limited liability company
By: ________DRAFT_______________
Name: __________________________
Title: ___________________________
47 CITY:

CITY OF SANTA MONICA,
a municipal corporation
By: ________DRAFT_______________
Name: ___________________________
Title: _____________________________
ATTEST:

By: ________DRAFT_______________
Name: ______________________________
City Clerk
APPROVED AS TO FORM:

By: ________DRAFT_______________
Name: ______________________________
City Attorney

ACKNOWLEDGEMENT AND CONSENT BY OPERATOR
As of the Effective Date of this Agreement, Orange Barrel Media, LLC, a Delaware limited liability company is the Operator as defined in Section 1.26 of this Agreement. Operator confirms its understanding of this Agreement, including but not limited to, Section 2.5 (Project and Community Benefits) and 2.11 (Operator Not a Third-Party Beneficiary to this Agreement).

OPERATOR:

ORANGE BARREL MEDIA, LLC,
a Delaware limited liability company
By: ________DRAFT_______________
48 Name: __________________________

Title: ___________________________
Exhibit “A”
EXHIBIT “A”

LEGAL DESCRIPTION OF PROPERTY

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SANTA

MONICA, IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

LOTS “A”, “B” AND “Y”, IN BLOCK 122 OF SANTA MONICA, IN THE CITY OF SANTA

MONICA, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 3, PAGES 80 AND 81, AND IN BOOK 39, PAGES 45 THROUGH 51,

INCLUSIVE, BOTH OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

APN: 4291-002-001
Exhibit “B”
EXHIBIT “B”

DIGITAL DISPLAY PLANS
[Behind this Page.]

PROPERTY LINE

PROPERTY LINE
18’-6” 17’-6” 7’-0”

NEW MEDIA OPERATOR IDENTIFICATION SIGNAGE,
INTERNALLY ILLUMINATED LETTERS 7” H x 10’-0” W
NEW 1000 SF TOTAL LED SIGNAGE,

WRAPS AROUND TO WILSHIRE ELEVATION

EXISTING FLUTED TOWER

NEW ARCHITECTURAL TRIM

REACTIVATE EXISTING BLADE SIGN,
SEE ELEVATION 47”
17” 13 5/8”
233”
1/8” THICK ALUMINUM CUTOUT

PAINTED BLACK AND FLUSH MO

TO EXISTING BLADE, BOTH SID

BLADE SIGN ELEVATION EAST ELEVATION
3RD STREET PROMENADE

ELEVATIONS
36'-0"

GRADE TO TOP OF SIGN

NEW ARCHITECTURAL TRIM, PAINTED

FINISH TO MATCH BRUSHED ALUMINUM

ADJUSTABLE WALL WASH FIXTURES

MOUNTED TO REAR OF SIGN FRAME

ILLUMINATE THE FLUTED TOWER ABOVE

PROPERTY LINE

PROPERTY LINE
18’-6” 17’-6” 7’-0”
NEW 1000 SF TOTAL LED SIGNAGE,
WRAPS AROUND TO 3RD ST ELEVATION

EXISTING FLUTED TOWER

NEW ARCHITECTURAL TRIM

EXISTING FLUTED TOWER

NORTH ELEVATION
WILSHIRE BOULEVARD 36'-0" GRADE TO TOP OF SIGN

ELEVATIONS

ADJUSTABLE WALL WASH FIXTURES

MOUNTED TO REAR OF SIGN FRAME

ILLUMINATE THE FLUTED TOWER ABOVE

AND BELOW THE SIGN

NEW ARCHITECTURAL TRIM, PAINTED

PROPERTY LINE
10’-0” 7’-8”
54’-10” LENGTH LED SCREEN
31’-6” 10’-0”
R = 10’-0”

NEW ARCHITECTURAL TRIM

EXISTING
AWNING

PLOT PLAN
5'- 0"
5'-0"
1'-10"

NEW ARCHITECTURAL TRIM ON BOTH

ENDS OF SIGN FACE

EXISTING TRIM PIECES TO REMAIN

EXISTING LIGHT WASH TO BE

REACTIVATED

LED MODULES &

SUB-FRAME
1202 3RD ST - NOVEMBER 18, 2025 © 2025 ORANGE BARREL MEDIA 18’-6” 17’-6” 7’-0”
3’-11”
17” 13 5/8”
19’-5”
1/8” THICK ALUMINUM CUTOUT LETTERS

PAINTED BLACK AND FLUSH MOUNTED

TO EXISTING BLADE, BOTH SIDES

BLADE SIGN ELEVATION

BLADE SIGN REACTIVATION
1202 3RD ST - NOVEMBER 18, 2025 © 2025 ORANGE BARREL MEDIA Exhibit “C”
EXHIBIT “C”
SMMC ARTICLE 9 (PLANNING AND ZONING)
[To be inserted.]
Exhibit “D”
EXHIBIT “D”

CONDITIONS OF APPROVAL
Project Specific Conditions

1. The Digital Display shall provide the project and community benefits as established in Section 2.5 of this Agreement.

Exhibit “E”
EXHIBIT “E”

PERMITTED FEES AND EXACTIONS

1. Owner shall pay the following fees and charges that are within the City’s jurisdiction and at the rate in effect at the time payments are made:
(a) Upon submittal for plan check, Owner shall pay City plan check fees; (b) Prior to issuance of construction permits, Owner shall pay the following City fees and all other standard fees imposed on similar development projects, which may include:
 Building, Plumbing, Mechanical, Electrical, Grading, Seismic Mapping, Landscape, Excavation and Shoring Permit fees (collected by Building & Safety)
 Construction and Demolition (C&D) Waste Management performance security fee (SMMC Chapter 8.108) (collected by the Public Works Department)
(c) Upon inspection of the project during the course of construction, City inspection fees.

These fees shall be reimbursed to Owner in accordance with the City's standard practice should Owner not proceed with development of the project.

2. Prior to issuance of permits for any construction work in the public right-of-way, or use of public property, Owner shall pay the following City fees:
 Use of Public Property Permit fees (SMMC 7.04.670) (Public Works Department)
 Utility Excavation Permit fee (SMMC 7.06.070) (Public Works Department)  Street Permit fee (SMMC 7.04.790) (Public Works Department)

3. Owner shall reimburse the City for its ongoing actual costs to monitor the project’s compliance with this Development Agreement. The City shall bill Owner for staff time and any material used pursuant to the hourly fees in effect at the time monitoring is performed. Owner shall submit payment to the City within 30 days after receipt of an invoice for same from the City.

Exhibit “F”, Page 1
EXHIBIT “F”

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
Recording Requested By and
When Recorded Mail To:

UNITED XYZ LLC
c/o XYZ.Rent – 1202 Third
2800 Olympic Blvd, Floor 1
Santa Monica, CA 90404
________________________________________________________________________

ASSIGNMENT AND ASSUMPTION AGREEMENT
This ASSIGNMENT AND ASSUMPTION AGREEMENT (“Agreement”) is made and entered into by and between ___________________________, a _____________________________ (“Assignor”), and ________________________, a __________________ (“Assignee”).

R E C I T A L S
[NOTE TO DRAFTER: This form Assignment and Assumption Agreement is drafted for a purchase and sale of the full Project Site. If the transfer is other than a purchase and sale and/or less than the entire Project Site is being transferred, this form needs to be revised. Notably, if less than the entire Project Site is being transferred and/or the Project Site or any portion therefore is being transferred to more than one owner, this form needs to be revised to add joint and several liability for all owners of the Project Site.] A. The City of Santa Monica (“City”) and Assignor entered into that certain Development Agreement dated _______________, ____ (the “Development Agreement”), with respect to the real property located in the City of Santa Monica, State of California more particularly described in Exhibit “A” attached hereto (the “Project Site”).

B. Assignor has obtained from the City certain development approvals and permits with respect to the development of the Project Site, including without limitation, approval of the Development Agreement for the Project Site (collectively, the “Digital Display Approvals”).

C. Assignor intends to sell, and Assignee intends to purchase, the Project Site.

D. In connection with such purchase and sale, Assignor desires to transfer all of the Assignor’s right, title, and interest in and to the Development Agreement and the Digital Display Approvals with respect to the Project Site. Assignee desires to accept such assignment from Assignor and assume the obligations of Assignor under the Development Agreement and the Digital Display Approvals with respect to the Project Site.

THEREFORE, the parties agree as follows:

Exhibit “F”, Page 2

1. Assignment. Assignor hereby assigns and transfers to Assignee all of Assignor’s right, title, and interest in and to the Development Agreement and the Digital Display Approvals with respect to the Project Site. Assignee hereby accepts such assignment from Assignor.

2. Assumption. Assignee expressly assumes and agrees to keep, perform, and fulfill all the terms, conditions, covenants, and obligations required to be kept, performed, and fulfilled by Assignor under the Development Agreement and the Digital Display Approvals with respect to the Project Site.

3. Effective Date. The execution by City of the attached receipt for this Agreement shall be considered as conclusive proof of (a) delivery of this Agreement (b) the assignment and assumption contained herein, and (c) the release of Assignor in accordance with Section 13.2 of the Development Agreement. This Agreement shall be effective upon its recordation in the Official Records of Los Angeles County, California, provided that Assignee has closed the purchase and sale transaction and acquired legal title to the Project Site.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the dates set forth next to their signatures below.
“ASSIGNOR”
_________________________________
“ASSIGNEE”
_____________________________
Exhibit “F”, Page 3

RECEIPT BY CITY
The attached ASSIGNMENT AND ASSUMPTION AGREEMENT is received by the City of Santa Monica on this ___ day of ________________, ________.

CITY OF SANTA MONICA
___________________________________
By: _______________________________
Community Development Director
Exhibit “G”
EXHIBIT “G”
Digital Display Ordinance
[To be inserted.]

Santa Monica City CouncilDecember 16, 2025

Santa Monica City Council
December 16, 2025