Rancho Palos Verdes City Council
   

JUNE 20, 2006 CABLE TELEVISION STUDIO LEASE JUNE 20, 2006 CABLE TELEVISION STUDIO LEASE

JUNE 20, 2006 CABLE TELEVISION STUDIO LEASE



TO: HONORABLE MAYOR AND CITY COUNCIL

FROM: CITY MANAGER

DATE: JUNE 20, 2006

SUBJECT: CABLE TELEVISION STUDIO LEASE

RECOMMENDATION

1) Approve the Lease Agreement between the City of Rancho Palos Verdes and the Southern California Regional Occupational Center for the Cable Television Studio.

2) Approve the Lease Agreement between the City of Rancho Palos and PV on the Net, terminating their present lease of the Cable Studio and entering into a new lease of a site for a modular building;

3) Approve a fourth amendment to the Lease for the Building where the PV on the Net offices are located to extend that agreement through June 20, 2009, which is a thirteen month extension, and to revise the methodology for further extending that lease, and

4) Continue to provide, at no charge, one hour of broadcast time on Channel 33, at 4:00 p.m., daily for PV on the Net Presents, which is to air programming produced by PV on the Net.

BACKGROUND

On October 1, 1996, the City Council and PV on the Net entered into a lease for the building that formerly housed the City’s Recreation and Parks Department. That lease has been amended on three occasions, and currently expires on May 6, 2008.

On May 6, 2003 the City Council and PV on the Net entered into a five-year lease for the City Cable Television Studio. The agreement formalized an arrangement, recommended by the Cable Television Ad Hoc Committee, through which PV on the Net would provide equipment to the City for operation of the Cable Television Studio in exchange for use of the studio. The agreement also described operational and technical support for the educational access channel to be provided by PV on the Net.

In March of this year, Gabriella Holt, Channel 33 Station Manager, proposed to Councilman Gardiner (Council Liaison to Channel 33) and PV on the Net Director, Ted Vegvari, that the Cable Studio be made available for Southern California Regional Occupational Center (SCROC) video production classes. The classes would be high school and adult education and would be offered on weekday afternoons. There would be no charge to SCROC for use of the facility.

DISCUSSION

PV on the Net has agreed to give up the remaining two years of their Studio lease as well as the cameras, lights and control equipment that PV on the Net installed in the building. However, in exchange for this concession, PV on the Net has requested that the City Council formalize an agreement leasing a site adjacent to the studio for PV on the Net’s modular building. The placement of this modular building was previously approved, in concept, by the City Council on November 15, 2005.

The attached Lease terminates the existing lease for the Studio building and enters into a new lease of an unimproved area next to the Studio where PV on the Net’s modular building will be located. If the City determines that PV on the Net’s building needs to be moved to accommodate other uses and construction on the City Hall property, the City shall provide nine months advance written notice to PV on the Net and shall pay all costs associated with the relocation of the building to another area on the City Hall property.

The attached lease is for a three-year term and includes an “ever-green” provision whereby the lease is automatically renewed for an additional year, unless either party gives notice by September 5th of each year that it wishes to terminate the lease. In that event, the lease will terminate on December 31st of the following year.

The amendment to the lease for the main building extends that lease for approximately 13 months, so that it will terminate at the same time as the lease for the property where the modular building will be located and contains the same requirements for termination.

PV on the Net also is requesting that the City Council approve as part of this item, that the City will continue to provide, at no charge, one hour of broadcast time on Channel 33, at 4:00 p.m., daily for PV on the Net Presents, which is to air programming produced by PV on the Net.



FISCAL IMPACT

The Agreement with PV on the Net for lease of a site for its modular building includes an agreement that the City will provide telephone, utilities, connection to the City’s alarm system, maintenance of the building, including plumbing and electrical repair work, and janitorial service during the term of the lease, at no charge to PV on the Net. The cost of these services could be as much as $5,000 annually depending on the amount of maintenance that will be required.



Respectfully:

Les Evans

City Manager

Attachment: Proposed City/SCROC Agreement for Lease of the Studio

Proposed City/ PVNet Agreement for Modular Building

Current City/PVNet Agreement for Lease of the Studio

Proposed Fourth Amendment to the Lease of the City’s Building

RECORDING REQUESTED BY

AND WHEN RECORDED RETURN TO:

City of Rancho Palos Verdes

Planning Department

30940 Hawthorne Boulevard

Rancho Palos Verdes, California 90275

APN:

[Space Above For Recorder’s Use Only]

Recording Fee: Exempt pursuant to California

Government Code Section 27383

LEASE AGREEMENT

THIS LEASE AGREEMENT (this “Lease”) dated as of August 28, 2006, is entered into by and between the CITY OF RANCHO PALOS VERDES, a California municipal corporation (“Landlord”), and SOUTHERN CALIFORNIA REGIONAL OCCUPATIONAL CENTER FOR THE ADVANCEMENT OF CAREERS AND TECHNOLOGIES dba SCROC, a ____________________ (“Tenant”).

R E C I T A L S:

A. Landlord is the owner of certain improved real property that is being used as a cable television studio with digital/video multimedia production capabilities.

B. Tenant has expertise and experience as an educator in the field of broadcast journalism and multimedia production and in training others, including youths and senior citizens in all aspects of such production. Tenant would like to use the cable television studio to train individuals and will provide programming for broadcast on Landlord’s Channel 33.

C. Landlord desires to lease such improved real property to Tenant, and Tenant desires to lease such improved real property from Landlord, upon the terms and conditions set forth herein.

A G R E E M E N T:

NOW, THEREFORE, Landlord and Tenant agree as follows:

DESCRIPTION OF PREMISES. Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the improved real property commonly known as “The Cable Television Studio” at the Rancho Palos Verdes Civic Center, located at 30940 Hawthorne Boulevard, Rancho Palos Verdes, California, which improved real property is indicated in the cross-hatch on Exhibit A attached hereto (the “Premises”). The Premises have been prepared by Landlord, at its sole cost and expense, for the uses described below, including the installation of two (1) VOIP phone that is connected to Landlord’s VOIP phone system. The Premises, including Landlord’s preparation thereof as described in the immediately preceding sentence, have been inspected by Tenant, and Tenant hereby acknowledges that Tenant is entering into this Lease after such inspection of the Premises and with full awareness of the conditions and character of the Premises and without reliance upon any representation as to the condition or character of the Premises that may have been made by representatives of Landlord. Tenant hereby accepts the Premises “AS IS,” except that Landlord specifically agrees to provide the repair and maintenance services specified in Section 7.2.

USE OF PREMISES. Tenant shall only use the Premises as a digital/video multimedia production studio in connection with teaching its broadcast journalism courses. Registration priority shall be given for individuals who are sixteen years of age or older and reside within the 90274 and 90275 zip codes. Tenant’s use of the Premises will be under the direction and supervision of Tenant’s fully qualified and credentialed instruction staff; provided, however, that such use shall include the following related uses:

2.1 Multimedia digital/video production training for youth and seniors;

2.2 Production of programming for Landlord, at Landlord’s request and subject to Landlord’s sole discretion, to be broadcast on Landlord’s Channel 33;

2.3 Development and production of digital/video multimedia projects for Tenant.

Tenant shall not use the Premises for any purpose that is unrelated to the purposes set forth above. Nothing herein shall be deemed or construed to permit or give Tenant the right to use Landlord’s cable television channel(s) (including the programming thereof). In addition, Tenant shall not use the Premises, or permit anything to be done in or about the Premises, that will in any way conflicts with, or otherwise violates, any law, statute, ordinance or other governmental rule or regulation applicable to the Premises and/or the uses thereof. Tenant shall comply, and shall cause the Premises and the uses thereof to comply, with all laws, statutes, ordinances and other governmental or quasi-governmental rules and regulations applicable thereto. Notwithstanding the foregoing, Tenant agrees that the Premises shall not be used for the production of multimedia programs/projects with content that may be inconsistent with Tenant’s program of providing instruction to minors (e.g., pornography, obscene language, violence or illicit drug use) or which is otherwise offensive to or inappropriate for said prospective users of the services/facilities at the Premises. Finally, under no circumstances shall any hazardous, toxic and/or contaminating substances be brought or kept on the Premises except for cleaning products typically used in connection with the equipment that is located in the Premises.

ACCESS TO PREMISES. Landlord hereby grants Tenant access to the Premises to operate its facilities and provide its services from 2:00 p.m. to 7:00 p.m., Monday through Friday; provided, however, that Landlord reserves the right to enter the Premises upon reasonable notice. Landlord may enter the Premises at other times and without notice in the event of an emergency. In addition, Tenant shall provide access to the Premises on a regular basis for the performance of Landlord’s maintenance and repair obligations specified in Section 7.2. In the event that a broadcast journalism course is cancelled or any other event occurs so that Tenant will not require use of the Premises, Tenant will notify Landlord’s representative so that the Premises can be used by Landlord for other purposes.

TERM OF LEASE. Subject to the right of either party to terminate this Lease at any time upon sixty (60) days prior notice, the term of this Lease shall be for a period of (1) year, commencing upon the date hereof. If Tenant notifies Landlord in writing on or before June 30, 2007, that Tenant wishes to renew this Lease, then this Lease shall be renewed for an additional year.

5.1.1 BASE RENT. Tenant shall pay no rent to Landlord for the use of Premises and the equipment provided by Landlord during the term of this Lease, which is listed below, other than the charges for utilities and maintenance set forth in Sections 6 and 7, respectively. Tenant shall retain any revenue received from student enrollment in Tenant’s classes. Tenant shall supply any additional equipment that is necessary to conduct its courses and to comply with this agreement, and shall pay for any costs for technical support provided by any other person or entity. In exchange for the use of the Premises, Tenant will provide broadcast journalism courses to individuals, including youths and seniors and residents of the City of Rancho Palos Verdes and nearby areas, with respect to the development and production of digital/video multimedia programs/projects. Landlord shall provide the equipment that is listed in Exhibit “B,” which is attached hereto and incorporated herein by this reference, to Tenant to support the foregoing services, which Tenant shall maintain and replace, at Tenant’s sole cost, when necessary.

6 UTILITIES. Landlord shall pay for all utilities used in connection with the Premises, including the City telephone system and the alarm system. Landlord also shall pay for all utilities that are not separately metered for the Premises, including water.

7 MAINTENANCE OF PREMISES.

7.1 Tenant’s Obligations. Tenant shall have the sole responsibility for repairing, replacing or maintaining the equipment referred to in Section 5 and described in Exhibit “B” in a good, safe, clean and operating condition, ordinary wear and tear excepted. Tenant agrees to make every effort to ensure that the improvements to, and equipment provided for, the Premises by, or on behalf of, Landlord, are not in any way damaged, misused, mishandled or removed from the Premises. Tenant shall reimburse Landlord for all custodial and cleaning services at the Premises that are caused by Tenant’s use, and for any repairs necessitated by Tenant’s use of the Premises or the equipment provided by Landlord.

7.2 Landlord’s Obligations. Landlord shall have the sole responsibility for maintaining the roof, structural, electrical, heating, venting and plumbing at the Premises in a good, safe, clean and operating condition, ordinary wear and tear excepted; provided, however, that Tenant shall reimburse Landlord for the reasonable costs and expenses incurred by Landlord in connection with any repairs to the Premises occasioned by Tenant’s use of the Premises. Landlord shall provide reasonable custodial and cleaning services at the Premises.

7.3 Breach of Obligations. In the event either party breaches its obligations to repair and/or maintain the Premises or equipment as specified in this Section 7, after reasonable notice thereof from the non-breaching party to the breaching party, the non-breaching party may, but shall not be obligated to, make or cause such repair or maintenance to be made, and the breaching party shall promptly reimburse the non-breaching party for all sums expended therefor.

8 ALTERATIONS TO PREMISES. No structural changes, alterations, repairs, additions, remodeling or improvements shall be made to the Premises by Tenant without the prior consent of Landlord. Except as otherwise provided herein, Landlord shall have no obligation to make structural changes, alterations, repairs, additions, remodeling or improvements to the Premises, including decorating or painting. Tenant shall use its best efforts to keep the Premises free of any mechanics’ liens arising from work performed to the Premises by Tenant, and in the event of the foregoing, Tenant shall immediately pay any amounts owing and obtain a release of any such lien.

9 TAXES. This Lease may create a possessory interest subject to property taxes and assessments. In such event, Tenant shall pay and discharge, prior to delinquency, all such taxes and assessments, whether the same are assessed to Landlord or Tenant. Any such taxes or assessment paid by Tenant to Landlord under the provisions hereof will be remitted by Landlord to the appropriate taxing agency in a timely manner, and the payment of such taxes or assessments by Tenant to Landlord shall fully discharge Tenant from its obligation to pay the same. In the event that Landlord shall pay any such taxes or assessments, Tenant shall be obligated to reimburse Landlord therefor.

10 HOLD HARMLESS. To the fullest extent permitted by law, and in addition to Tenant’s other obligations hereunder, at law, in equity or otherwise, Tenant agrees to protect, indemnify, defend and hold Landlord and its officers, directors, employees, representatives, agents and affiliates free and harmless from and against any action, suit, claim, investigation, proceeding, mediation or arbitration at law or in equity or before or by any foreign or domestic court, arbitrator, mediator or otherwise (including reasonable attorney’s fees and expenses in connection therewith), and pay or reimburse Landlord in full, any and all liability, loss, cost, expense or damage of any kind or nature that Landlord may sustain or incur or that may be brought or claimed against Landlord in connection with (a) Tenant’s use of the Premises, (b) Tenant’s breach or default in the performance of any of its obligations hereunder or (c) any act, neglect, fault or omission of Tenant or its agents, employees, visitors, invitees or licensees. Notwithstanding the foregoing, it is the intent of Landlord and Tenant that Tenant shall be liable to protect, indemnify, defend and hold Landlord harmless under this Section 10 irrespective of the cause of such indemnification liability (i.e., regardless of whether or not caused by any act, omission, willful misconduct or negligent conduct (whether active or passive) of Tenant, or otherwise), except if the sole cause of such indemnification liability is the negligence, gross negligence or willful misconduct of Landlord.

11 ASSIGNMENT AND SUBLETTING. Tenant shall not voluntarily, or by operation of law, assign, sublet or otherwise transfer or encumber all or any part of Tenant’s interest in this Lease or the Premises without the prior consent of Landlord, and any attempt to do so shall be null and void ab initio. No assignment or subletting shall relieve Tenant of its obligations hereunder. The acceptance of payments by Landlord from any other person or entity shall not be deemed to be a waiver by Landlord of any provision of this Lease or to be a consent of any assignment, subletting or other transfer and shall not be deemed to constitute a consent to any subsequent assignment, subletting or other transfer.

12 DEFAULTS AND REMEDIES.

12.1 Defaults. Any of the following events shall constitute a default under this Lease by Tenant:

12.1.1 Monetary Default. A breach of this Agreement by Tenant involving the payment of money, and the continuance of such breach for a period of ten (10) days after Tenant’s receipt of notice thereof; or

12.1.2 Non-Monetary Default. A breach of any material term of this Agreement by Tenant not involving the payment of money, and the continuance of such breach for a period of thirty (30) days after Tenant’s receipt of notice thereof; provided, however, that if such breach is not reasonably susceptible of being cured within such thirty (30) day period, then a default shall exists only if Tenant does not commence to cure such breach within such thirty (30) day period or thereafter fails to diligently prosecute such cure to completion.

12.2 Termination of Lease and Remedies. In the event of a default by Tenant, Landlord may, at any time prior to a cure thereof by Tenant, upon notice and demand, and without limiting Landlord in the exercise of any other right or remedy that Landlord may have by reason of such default, terminate Tenant’s right to possession of the Premises by any lawful means, in which case this Lease shall terminate and Tenant shall immediately surrender possession of the Premises to Landlord. In such event, Landlord shall also be entitled to recover from Tenant Any amount necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform its obligations hereunder or which, in the ordinary course of events, would be likely to result therefrom.

12.3 Non-waiver. Nothing contained in this Section 12 shall constitute a waiver of Landlord’s right to recover damages by reason of Landlord’s efforts to mitigate its damages caused by Tenant’s default; nor shall anything in this Section 12 adversely affect Landlord’s right, as provided in this Lease, to indemnification against liability for damage to persons or property occurring prior to the termination of this Lease.

13 DAMAGE AND DESTRUCTION. In the event the Premises are damaged or destroyed, Landlord shall have the sole option of either repairing the Premises or terminating this Lease as of the date of such destruction or damage.

14 MISCELLANEOUS.

14.1 Notices: Any notice, request, direction, demand, consent, waiver, approval or other communication required or permitted to be given hereunder shall not be effective unless it is given in writing and shall be delivered (a) in person, (b) by certified mail, postage prepaid, return receipt requested, or (c) by a commercial overnight courier that guarantees next day delivery and provides a receipt, and addressed to the parties at the addresses stated below, or at such other address as either party may hereafter notify the other in writing as aforementioned:

Landlord: City of Rancho Palos Verdes

30940 Hawthorne Boulevard

Rancho Palos Verdes, California 90275

Attention: City Manager

Facsimile: (310) 377-0360

Tenant: Southern California Regional Occupational Center

___________________________________

___________________________________

Attention: __________________________

Facsimile: ( ) ___________

14.2 Non-Waiver. The failure of Landlord to insist upon strict performance of any of the terms, conditions or covenants of this Lease shall not be deemed a waiver of any right or remedy Landlord may have and shall not be deemed a waiver of any right or remedy for subsequent breach or default of the terms, conditions, or covenants herein contained.

14.3 Resolution of Problems. Ms. Gabriella Holt, who is Landlord’s representative in connection with this agreement, shall report any problems or complaints to the Director of Tenant. The Director of Tenant shall be responsible for seeking a solution to any major or frequently reported problem or complaints. In the event such problems or complaints are not resolved, Ms. Holt and/or City Manager of Landlord shall meet with the Director of Tenant to review the situation and propose an appropriate solution.

14.4 End of Term. At the end of the term, Tenant shall return the Premises to Landlord in a similar condition as received, ordinary wear and tear excepted.

14.5 Holding Over. Should Tenant, with or without Landlord’s consent, hold over after the termination of this Lease, such possession by Tenant shall be deemed to be a month-to-month tenancy terminable by thirty (30) days notice given at any time, upon each and all of the terms herein provided as may be applicable to a month-to-month tenancy, and any such holding over shall not constitute an extension of this Lease.

14.6 Attorney’s Fees. Each party to this agreement shall be responsible for its own attorney’s fees or costs incurred in connection with the negotiation and preparation of this Lease. In the event of any litigation between Tenant and Landlord to enforce any provision of this Lease or any right of either party hereto, or to secure a judicial determination of any right or obligation of either party hereto, the unsuccessful party in such litigation shall pay to the successful party reasonable costs and expenses, including reasonable attorney’s fees, incurred therein.

14.7 Headings. The section captions contained in this Lease are for convenience and do not in any way limit or amplify any term or provision of this Lease and shall have no effect on its interpretation.

14.8 Entire Agreement. This Lease and the exhibit attached hereto constitute the entire agreement between the parties hereto with respect to the subject matter hereof, and no prior agreement or understanding pertaining to any such matter shall be effective for any purpose. No provision of this Lease may be amended or supplemented except by an agreement in writing signed by the parties hereto.

14.9 Quiet Possession. Upon complying with all the terms and conditions hereof, and subject to all of the provisions hereof, Tenant shall have quiet possession of the Premises.

14.10 Governing Law. This Lease is made and entered into in the State of California and shall in all respects be interpreted, enforced and governed under the laws of the State of California. Any legal action to enforce the provisions of this Lease shall be filed in any court of competent jurisdiction in Los Angeles County.

14.11 Severability. If any term or provision of this Lease shall be deemed to be invalid or unenforceable to any extent, the remainder of this Lease will not be affected thereby, and each remaining term and provision of this Lease will be valid and be enforced to the fullest extent permitted by law.

14.12 No Joint Venture. It is not the intent of the parties to create a joint venture or partnership by entering into this Lease.

14.13 Interpretation. Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural and vice versa. References to “Sections” and “Exhibits” are to sections and exhibits of this Lease, unless otherwise specifically provided.

14.14 Counterparts. This Lease may be executed in one or more counterparts, each of which shall be deemed to constitute an original, but all of which, when taken together, shall constitute one and the same instrument, with the same effect as if all of the parties had executed the same counterpart.

14.15 No Discrimination. There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, national origin, ancestry, physical handicap, mental condition, marital status, sex or sexual orientation with respect to the Premises, nor shall Tenant establish or permit any such practice or practices of discrimination or segregation with reference to the use of the Premises.

14.16 Joint Preparation of Lease. None of the Parties hereto shall be deemed to be the drafter of this Lease, but it shall be deemed that this Lease was jointly drafted by each of the Parties hereto. The terms of this Lease shall not be interpreted or construed in favor of, or against, any Party hereto. Should any provision of this Lease be found to be ambiguous in any way, such ambiguity shall not be resolved by construing this Lease in favor of or against any Party herein, but rather by construing the terms of this Lease as a whole according to their fair meaning.

15. Insurance Requirements. Tenant shall at all time during the term of this Agreement carry, maintain, and keep in full force and effect, with an insurance company admitted to do business in California with a minimum rating of A in the latest edition of Best’s Insurance Guide: (1) a policy or policies of broad-form comprehensive general liability insurance with minimum limits of $1,000,000.00 combined single limit coverage against any injury, death, loss or damage as a result of wrongful or negligent acts by Tenant, its officers, employees, and agents in performance of services under this Agreement; (2) property damage insurance, which shall include coverage for damage to the equipment provided by Landlord pursuant to this Lease, with a minimum limit of $1,000,000.00; (3) automotive liability insurance with a minimum combined single limits coverage of $1,000,000.00; and (4) worker's compensation insurance with a minimum limit of $1,000,000.00 or the amount required by law, whichever is greater. Landlord, its officers, employees, attorneys, and volunteers shall be named as additional insureds on the policy (ies) as to comprehensive general liability, property damage, and worker's compensation coverage.

a. All insurance policies shall provide that the insurance coverage shall not be non-renewed, canceled, reduced, or otherwise modified (except through addition of additional insured to the policy) by the insurance carrier without the insurance carrier giving Landlord thirty (30) day's prior written notice thereof. Landlord agrees that it will not cancel, reduce or otherwise modify said insurance coverage.

b. Landlord agrees that if it does not keep the aforesaid insurance in full force and effect, and such insurance is available at a reasonable cost, Landlord may take out the necessary insurance and pay the premium thereon, and the repayment thereof shall be deemed an obligation of Tenant.

c. Tenant shall submit to the City (1) insurance certificates indicating compliance with the insurance requirements set forth above, and (2) insurance policy endorsements, not less than one (1) day prior to beginning of the term of this Lease.

IN WITNESS WHEREOF, the parties hereto have executed this Lease Agreement as of the date first written above.

TENANT: SOUTHERN CALIFORNIA REGIONAL OCCUPATIONAL CENTER FOR THE ADVANCEMENT OF CAREERS AND TECHNOLOGIES dba SCROC, a ___________________________________

By: _____________________________

Name: _____________________________

Title: _____________________________

[signatures continue]

RECORDING REQUESTED BY

AND WHEN RECORDED RETURN TO:

City of Rancho Palos Verdes

Planning Department

30940 Hawthorne Boulevard

Rancho Palos Verdes, California 90274

APN:

[Space Above For Recorder’s Use Only]

Recording Fee: Exempt pursuant to California

Government Code Section 27383

LEASE AGREEMENT

THIS LEASE AGREEMENT (this “Lease”) dated as of __________ ___, 2006, is entered into by and between the CITY OF RANCHO PALOS VERDES, a California municipal corporation (“Landlord”), and PALOS VERDES ON THE NET, a California non-profit corporation (“Tenant”).

R E C I T A L S:

D. Landlord is the owner of certain improved real property located at 30940 Hawthorne Boulevard, Rancho Palos Verdes (“the Property”).

E. Tenant has been leasing a building on the Property for use as a cable television studio with full digital/video multimedia production capabilities (“Studio”), pursuant to a lease that was entered into on May 6, 2003.

F. At the November 15, 2005 City Council meeting, Landlord granted permission to Tenant to place Tenant’s portable building on the Landlord’s property adjacent to the Studio for Tenant’s use as a Multimedia and Information Technology Center.

G. Landlord now wishes to rent the Studio to others and use the Studio, including equipment that belongs to Tenant, which is described in Exhibit “B” hereto, and wishes to terminate Tenant’s existing of the Studio.

H. Landlord desires to lease an unimproved portion of the Property that is adjacent to the Studio to Tenant, and Tenant desires to lease such improved real property from Landlord, upon the terms and conditions set forth herein.

A G R E E M E N T:

NOW, THEREFORE, Landlord and Tenant agree as follows:

DESCRIPTION OF PREMISES. Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the unimproved portion of Landlord’s property that is adjacent to the Studio at the Rancho Palos Verdes Civic Center, located at 30940 Hawthorne Boulevard, Rancho Palos Verdes, California, which unimproved real property is indicated in the cross-hatch on Exhibit A attached hereto (the “Premises”) so that Tenant can place its modular building (“Building”) thereon. The Premises have been, or will be, prepared by Landlord, at its sole cost and expense, for said use, including the installation of two (1) VOIP phones that will be connected to Landlord’s VOIP phone system and utilities to serve the Building.

Landlord may determine, in its sole and reasonable discretion, that construction of other structures or facilities on the Property requires the Building to be moved to another equivalent area on the Property. In that event, Landlord shall provide at least nine months prior written notice to Tenant of the relocation, and shall pay all costs associated with the relocation of the Building.

USE OF PREMISES. Tenant shall have the right to place its Building on the Premises for use in connection with its operation of a Multimedia and Information Technology Center in connection with its existing community telecommunication center, which is operated under the name Palos Verdes on the Net. Tenant shall not use the Premises for any purpose that is unrelated to this purpose.

In addition, Tenant shall not use the Premises, or permit anything to be done in or about the Premises, that will in any way conflicts with, or otherwise violates, any law, statute, ordinance or other governmental rule or regulation applicable to the Premises and/or the uses thereof. Tenant shall comply, and shall cause the Premises and the uses thereof to comply, with all laws, statutes, ordinances and other governmental or quasi-governmental rules and regulations applicable thereto. Notwithstanding the foregoing, Tenant agrees that the Premises shall not be used for the production of multimedia programs/projects with content that may be inconsistent with Tenant’s program of providing instruction to minors (e.g., pornography, obscene language, violence or illicit drug use) or which is otherwise offensive to or inappropriate for said prospective users of the services/facilities at the Premises. Finally, under no circumstances shall any hazardous, toxic and/or contaminating substances be brought or kept on the Premises except for cleaning products typically used in connection with the equipment that is located in the Premises.

ACCESS TO PREMISES. Landlord hereby grants Tenant access to the Premises to operate its facilities and provide its services as much as twenty-four (24) hours per day, seven days a week; provided, however, that Landlord reserves the right to enter Tenant’s Building upon reasonable notice during Tenant’s posted business hours. Landlord may enter the Premises and the Building at other times and without notice in the event of an emergency. In addition, Tenant shall provide access to the Premises and the Building on a regular basis for the performance of Landlord’s maintenance and repair obligations specified in Section 7.2.

TERM OF LEASE. The term of this Lease shall be for a period of three years, effective as of the date and year first written above. This Lease shall automatically renew from year to year thereafter, unless on or before September 1st of each year, either party notifies the other party in writing that the party wishes to terminate or amend this Lease. If such notice is given, the lease shall be terminated on December 31st of the year following the year when the written notice is given.

BASE RENT. In exchange for the termination of the existing lease for the Studio and the donation to Landlord of the equipment listed in Exhibit “B,” Tenant shall pay no rent to Landlord for the use of Premises during the term of this Lease, other than the charges for utilities and maintenance set forth in Sections 6 and 7, respectively.

15 UTILITIES. Landlord shall pay for all utilities used in connection with the Premises, including the City telephone system and the alarm system. Landlord also shall pay for all utilities that are not separately metered for the Premises, including water. Other than the two VOIP telephones, which shall be provided by Landlord, Tenant shall pay for Tenant’s telephone system.

16 MAINTENANCE OF PREMISES.

16.1 Tenant’s Obligations. Except as specifically provided in Section 6.2, Tenant shall have the sole responsibility for maintaining the Building in a good, safe, clean and operating condition so that it is compatible with other structures on Landlord’s Property. Tenant shall reimburse Landlord for any repairs necessitated by Tenant’s use of the Premises.

16.2 Landlord’s Obligations. Landlord shall have the sole responsibility for maintaining the roof, structural, electrical, heating, venting and plumbing at the Premises in a good, safe, clean and operating condition, ordinary wear and tear excepted; provided, however, that Tenant shall reimburse Landlord for the reasonable costs and expenses incurred by Landlord in connection with any repairs to the Premises occasioned by Tenant’s use of the Premises (i.e., Tenant shall be responsible for repairs to plumbing and electrical systems to the extent such maintenance or repairs are required due to Tenant’s use of the Premises.) Landlord shall provide reasonable custodial and cleaning services at the Premises.

16.3 Breach of Obligations. In the event either party breaches its obligations to repair and/or maintain the Premises as specified in this Section 7, after reasonable notice thereof from the non-breaching party to the breaching party, the non-breaching party may, but shall not be obligated to, make or cause such repair or maintenance to be made, and the breaching party shall promptly reimburse the non-breaching party for all sums expended therefor.

17 ALTERATIONS TO PREMISES. Other than installing the Building on the Premises, no structural changes, alterations, repairs, additions, remodeling or improvements shall be made to the Premises by Tenant without the prior consent of Landlord; provided; however, that Tenant may make modifications to the interior of the Building without Landlord’s permission. Except as otherwise provided herein, Landlord shall have no obligation to make structural changes, alterations, repairs, additions, remodeling or improvements to the Premises or the Building, including decorating or painting. Tenant shall use its best efforts to keep the Premises free of any mechanics’ liens arising from work performed to the Premises by Tenant, and in the event of the foregoing, Tenant shall immediately pay any amounts owing and obtain a release of any such lien.

18 TAXES. This Lease may create a possessory interest subject to property taxes and assessments. In such event, Tenant shall pay and discharge, prior to delinquency, all such taxes and assessments, whether the same are assessed to Landlord or Tenant. Any such taxes or assessment paid by Tenant to Landlord under the provisions hereof will be remitted by Landlord to the appropriate taxing agency in a timely manner, and the payment of such taxes or assessments by Tenant to Landlord shall fully discharge Tenant from its obligation to pay the same. In the event that Landlord shall pay any such taxes or assessments, Tenant shall be obligated to reimburse Landlord therefor.

19 HOLD HARMLESS. To the fullest extent permitted by law, and in addition to Tenant’s other obligations hereunder, at law, in equity or otherwise, Tenant agrees to protect, indemnify, defend and hold Landlord and its officers, directors, employees, representatives, agents and affiliates free and harmless from and against any action, suit, claim, investigation, proceeding, mediation or arbitration at law or in equity or before or by any foreign or domestic court, arbitrator, mediator or otherwise (including reasonable attorney’s fees and expenses in connection therewith), and pay or reimburse Landlord in full, any and all liability, loss, cost, expense or damage of any kind or nature that Landlord may sustain or incur or that may be brought or claimed against Landlord in connection with (a) Tenant’s use of the Premises, (b) Tenant’s breach or default in the performance of any of its obligations hereunder or (c) any act, neglect, fault or omission of Tenant or its agents, employees, visitors, invitees or licensees. Notwithstanding the foregoing, it is the intent of Landlord and Tenant that Tenant shall be liable to protect, indemnify, defend and hold Landlord harmless under this Section 10 irrespective of the cause of such indemnification liability (i.e., regardless of whether or not caused by any act, omission, willful misconduct or negligent conduct (whether active or passive) of Tenant, or otherwise), except if the sole cause of such indemnification liability is the negligence, gross negligence or willful misconduct of Landlord.

20 ASSIGNMENT AND SUBLETTING. Tenant shall not voluntarily, or by operation of law, assign, sublet or otherwise transfer or encumber all or any part of Tenant’s interest in this Lease or the Premises without the prior consent of Landlord, and any attempt to do so shall be null and void ab initio. No assignment or subletting shall relieve Tenant of its obligations hereunder. The acceptance of payments by Landlord from any other person or entity shall not be deemed to be a waiver by Landlord of any provision of this Lease or to be a consent of any assignment, subletting or other transfer and shall not be deemed to constitute a consent to any subsequent assignment, subletting or other transfer.

21 DEFAULTS AND REMEDIES.

20.1 Defaults. Any of the following events shall constitute a default under this Lease by Tenant:

20.1.1 Monetary Default. A breach of this Agreement by Tenant involving the payment of money, and the continuance of such breach for a period of ten (10) days after Tenant’s receipt of notice thereof; or

20.1.2 Non-Monetary Default. A breach of any material term of this Agreement by Tenant not involving the payment of money, and the continuance of such breach for a period of thirty (30) days after Tenant’s receipt of notice thereof; provided, however, that if such breach is not reasonably susceptible of being cured within such thirty (30) day period, then a default shall exists only if Tenant does not commence to cure such breach within such thirty (30) day period or thereafter fails to diligently prosecute such cure to completion.

20.2 Termination of Lease and Remedies. In the event of a default by Tenant, Landlord may, at any time prior to a cure thereof by Tenant, upon notice and demand, and without limiting Landlord in the exercise of any other right or remedy that Landlord may have by reason of such default, terminate Tenant’s right to possession of the Premises by any lawful means, in which case this Lease shall terminate and Tenant shall immediately surrender possession of the Premises to Landlord. In such event, Landlord shall also be entitled to recover from Tenant Any amount necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform its obligations hereunder or which, in the ordinary course of events, would be likely to result therefrom.

20.3 Non-waiver. Nothing contained in this Section 12 shall constitute a waiver of Landlord’s right to recover damages by reason of Landlord’s efforts to mitigate its damages caused by Tenant’s default; nor shall anything in this Section 12 adversely affect Landlord’s right, as provided in this Lease, to indemnification against liability for damage to persons or property occurring prior to the termination of this Lease.

21 DAMAGE AND DESTRUCTION. In the event the Premises or the Building are damaged or destroyed, either party shall have the option of either repairing the Premises or the Building or terminating this Lease as of the date of such destruction or damage.

22 MISCELLANEOUS.

22.1 Notices: Any notice, request, direction, demand, consent, waiver, approval or other communication required or permitted to be given hereunder shall not be effective unless it is given in writing and shall be delivered (a) in person, (b) by certified mail, postage prepaid, return receipt requested, or (c) by a commercial overnight courier that guarantees next day delivery and provides a receipt, and addressed to the parties at the addresses stated below, or at such other address as either party may hereafter notify the other in writing as aforementioned:

Landlord: City of Rancho Palos Verdes

30940 Hawthorne Boulevard

Rancho Palos Verdes, California 90275

Attention: City Manager

Tenant: Palos Verdes on the Net

30940 Hawthorne Boulevard

Rancho Palos Verdes, California 90275

Attention: Ted Vegvari

22.2 Non-Waiver. The failure of Landlord to insist upon strict performance of any of the terms, conditions or covenants of this Lease shall not be deemed a waiver of any right or remedy Landlord may have and shall not be deemed a waiver of any right or remedy for subsequent breach or default of the terms, conditions, or covenants herein contained.

22.3 Resolution of Problems. The Senior Administrative Analyst in the City Manager’s Office of Landlord shall report any problems or complaints to the Director of Tenant. The Director of Tenant shall be responsible for seeking a solution to any major or frequently reported problem or complaints. In the event such problems or complaints are not resolved, the Senior Administrative Analyst and/or City Manager of Landlord shall meet with the Director of Tenant to review the situation and propose an appropriate solution.

22.4 End of Term. At the end of the term, Tenant shall remove the Building and return the Premises to Landlord in a similar condition as received, ordinary wear and tear excepted.

22.5 Holding Over. Should Tenant, with or without Landlord’s consent, hold over after the termination of this Lease, such possession by Tenant shall be deemed to be a month-to-month tenancy terminable by thirty (30) days notice given at any time, upon each and all of the terms herein provided as may be applicable to a month-to-month tenancy, and any such holding over shall not constitute an extension of this Lease.

22.6 Attorney’s Fees. In the event of any litigation between Tenant and Landlord to enforce any provision of this Lease or any right of either party hereto, or to secure a judicial determination of any right or obligation of either party hereto, the unsuccessful party in such litigation shall pay to the successful party reasonable costs and expenses, including reasonable attorney’s fees, incurred therein.

22.7 Headings. The section captions contained in this Lease are for convenience and do not in any way limit or amplify any term or provision of this Lease and shall have no effect on its interpretation.

22.8 Entire Agreement. This Lease and the exhibit attached hereto constitute the entire agreement between the parties hereto with respect to the subject matter hereof, and no prior agreement or understanding pertaining to any such matter shall be effective for any purpose. No provision of this Lease may be amended or supplemented except by an agreement in writing signed by the parties hereto.

22.9 Quiet Possession. Upon complying with all the terms and conditions hereof, and subject to all of the provisions hereof, Tenant shall have quiet possession of the Premises.

22.10 Governing Law. This Lease is made and entered into in the State of California and shall in all respects be interpreted, enforced and governed under the substantive laws of the State of California.

22.11 Severability. If any term or provision of this Lease shall be deemed to be invalid or unenforceable to any extent, the remainder of this Lease will not be affected thereby, and each remaining term and provision of this Lease will be valid and be enforced to the fullest extent permitted by law.

22.12 No Joint Venture. It is not the intent of the parties to create a joint venture or partnership by entering into this Lease.

22.13 Interpretation. Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural and vice versa. References to “Sections” and “Exhibits” are to sections and exhibits of this Lease, unless otherwise specifically provided.

22.14 Counterparts. This Lease may be executed in one or more counterparts, each of which shall be deemed to constitute an original, but all of which, when taken together, shall constitute one and the same instrument, with the same effect as if all of the parties had executed the same counterpart.

22.15 No Discrimination. There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, national origin, ancestry, physical handicap, mental condition, marital status, sex or sexual orientation with respect to the Premises, nor shall Tenant establish or permit any such practice or practices of discrimination or segregation with reference to the use of the Premises.

14. The existing Lease Agreement between the parties, dated May 6, 2003, whereby Tenant had been leasing the Studio from Landlord, is hereby terminated as of September 4, 2006.

IN WITNESS WHEREOF, the parties hereto have executed this Lease Agreement as of the date first written above.

TENANT: PALOS VERDES ON THE NET, a California non-profit corporation

By: _____________________________

Name: _____________________________

Title: _____________________________

By: _____________________________

Name: _____________________________

Title: _____________________________

[signatures continue]

LANDLORD: CITY OF RANCHO PALOS VERDES, a California municipal corporation

By: _____________________________

Name: _____________________________

Title: _____________________________

ATTEST:

_____________________________

City Clerk

LANDLORD: CITY OF RANCHO PALOS VERDES, a California municipal corporation

By: _____________________________

Name: _____________________________

Title: _____________________________

ATTEST:

_____________________________

City Clerk

EXHIBIT B

Cable Studio - Gift Inventory List

(2) Canon XL1S

(2) Canon SP100 shoulder kits

(2) Canon Pro XLR balanced audio units

(2) Varizoom controllers

(2) camera attached LCD monitors paks for Canon Cameras

(2) portable kits for camera attached LCD monitors for Canon Cameras

(1) Sony VX1000 with accessories and hard case

(1) Kenco Pro wide angle lens, and wide conversion lens for Sony Camera

(2) Teleprompter system with Software, Manual, LCD monitor, Computer, Windows XP, keyboard and mouse

(3) Libec pro Studio Tripods with wheels and heads

(5) Videssence Studio Lights with Clamps and cabling

(5) Station Production Intercom headsets with master unit, power supply, and cables

(2) Shure wireless lapel microphones with transmitters, receivers, cables

(1) MonoPod

(1) DataVideo 4 Channel digital video switcher/mixer

(1) Alesys Pro 16 channel audio mixer

(1)Sony DVCAM DSR11 digital deck

(1) pair speakers in control room

(1) JVC Studio video monitor

(1) Toshiba 15 inch Television

(1) Sylvania VHS recorder

(1) KLH multiformat DVD/CD deck

(1) Sony Betacam deck

(1) Sony Beta HiFi deck

(1) Panasonic SVHS deck

(1) Portable green screen with stand

(1) table and shelf unit in control room

(1) Custom built work space/tables in front office

(1) Studio set

(2) trees (props)

(2) 3 panel room dividers

Overhead rails for hanging lighting

Cabling and connectors for equipment, microphones, decks, monitors, mixers, misc improvements including exterior building connection for live broadcasting