Draft By-laws - Relocation of Advertising Sign

from High Park Area to Exhibition Place (Trinity-Niagara)

The Toronto Community Council recommends that:

(1)the Draft By-law attached to the report (April 27, 1999) from the City Solicitor be approved and that authority be granted to introduce the necessary Bill in Council to give effect thereto; and

(2)as the final location of the sign may cause it to extend beyond the area covered by By-law No. 211-79, City Council grant a variance from Chapter 297, Signs, of the Municipal Code of the former City of Toronto to allow the erection of the double-sided sign as described in the report (February 21, 1999) of the Interim General Manager of Exhibition Place and Application No. 999071.

The Toronto Community Council reports, for the information of Council, that notice of the public meeting was given in accordance with the Planning Act. The public meeting was held on April 28, 1999, and Ms. Joan Miles, High Park Citizens' Advisory Committee, addressed the Toronto Community Council.

The Toronto Community Council submits the following report (April 27, 1999) from the City Solicitor:

Purpose:

This report provides the necessary Draft By-law to allow the erection of a sign on Exhibition Place within 40 metres west of Strachan Avenue.

Funding Sources, Financial Implications and Impact Statement:

The enactment of the Draft By-laws has no financial implications for the City. It requires no funding.

Recommendations:

It is recommended that:

(1)the Toronto Community Council hold a public meeting in respect of the attached Draft By-law in accordance with the provisions of the Planning Act.

Following the public meeting and in the event the Toronto Community Council wishes to approve the Draft By-law, it could recommend:

(2)that the Draft By-law attached to the report (April 27, 1999) of the City Solicitor be approved and that authority be granted to introduce the necessary bill in Council to give effect thereto.

Background:

At its meeting of March 30, 1999, the Toronto Community Council considered the report (February 21, 1999) of the Interim General Manager of Exhibition Place and requested that the matter be deferred to its meeting of April 28 and that the City Solicitor bring forward a draft by-law to that meeting.

Comments and/or Discussion and/or Justification:

This report contains the necessary Draft By-law, which, if enacted, will give effect to the recommendations of the Interim General Manager.

Contact Name:

Edward Earle

Legal Services

397-4058

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Authority:Toronto Community Council Report No. ( ), 1999

Enacted by Council: , 1999

CITY OF TORONTO

Bill No.

BY-LAW No.

To further amend By-lawNo.211-79 of the former Municipality of Metropolitan Toronto, being "A By-law to prohibit signs on lands adjacent to certain Metropolitan Roads" to permit the erection of a sign on Exhibition Place within 40 metres west of Strachan Avenue.

WHEREAS By-law No. 211-79 was previously amended by By-law No. 106-97 of the former Metro to allow for the erection of a sign within certain lands located within 45 metres of the southerly limit of the Frederick G. Gardiner Expressway and within Exhibition Place; and

WHEREAS City Council has determined that it is appropriate that permission be granted for the erection of an additional double-faced faced sign at Exhibition Place within those lands; and

WHEREAS this by-law has therefore been enacted in accordance with the requirements of the Planning Act;

The Council of the City of Toronto HEREBY ENACTS as follows:

1.By-law No.211-79 of the former Municipality of Metropolitan Toronto, being "A By-law to prohibit signs on lands adjacent to certain Metropolitan Roads", is hereby amended by adding thereto the following section:

1b.(1)Notwithstanding section 1, the lands lying within 45 metres of the southerly limit of the Frederick G. Gardiner Expressway and within Exhibition Place as defined in subsection61(1) of the City of Toronto Act, 1997 (No. 2), S.O.1997, c.26 and not more than 40 metres west of the westerly limit of Strachan Avenue as shown hatched on Map2 attached as Schedule "B" to this by-law may be used for the erection of not more than one double-faced sign at Exhibition Place for the purposes of:

(a)identifying the location of the National Trade Centre and Exhibition Place,

(b)informing the public of the events occurring in the National Trade Centre and at Exhibition Place, and

(c)advertising.

(2)Map 2, attached as Schedule"B", shall form part of this by-law.

ENACTED AND PASSED this day of , A.D. 1999.

___________________________________________

MayorCity Clerk

SCHEDULE "B"

[MAP TO BE INSERTED]

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The Toronto Community Council also submits the following report (April 15, 1999) from the Commissioner of Urban Planning and Development Services:

Purpose:

This report recommends refusal of an application for variances or amendments as required to permit one illuminated ground sign for third party advertising at 2 Strachan Avenue.

This recommendation is based not only on a technical reading of the legislation but on an evaluation of a range of relevant planning and heritage policies some of which are as recent as the past year. The proposed sign is not consistent with the following:

- former City of Toronto Part I Official Plan;

- Garrison Common Master Plan;

- Chapter 297 - Municipal Code;

- former Metro By-law 211-79;

- New approach to signage approved for Exhibition Place;

- Heritage Policies; and

- Exhibition Place Program and Development Concept.

Source of Funds:

Not applicable.

Recommendation:

It is recommended that City Council refuse Application No. 999017 respecting both minor variances from Chapter 297, Signs, of the former City of Toronto Municipal Code and an amendment to the former Metro By-law No. 211-79 to permit one illuminated ground sign.

Comments:

1.Description of the Sign

The property, a part of Exhibition Place grounds, is located east of Strachan Avenue and is bounded by Lake Shore Boulevard West on the south and the Gardiner Expressway on the north. The applicant is requesting permission to relocate an existing double-sided third party ground sign from the corner of Lake Shore Boulevard and Ellis Avenue to Exhibition Place, east of the General Services Building near Strachan Avenue (see Figure 1). The west-facing sign panel, as illustrated on Figure 2, has a length of 20.7 metres and a height of 12.5 metres, with an area of 250 square metres and contains electronic message display. The east-facing sign panel, as illustrated on Figure 3 has a length of 18.3 metres and a height of 14.0 metres, with an area of 256 square metres and contains electronic message display and a tri-vision panel. The sign would be located 14.6 metres south of the Gardiner Expressway.

The applicant has advised that while no changes are proposed to the existing sign panels, a new pole support consistent with the one used on the Omni sign on Manitoba Drive at Exhibition Place will be used. The sign height will be approximately 6 metres higher than at Ellis Avenue. I understand that there may be some flexibility in the ultimate height of the sign, and the owner has agreed to discuss this matter with City staff, should Council decide to proceed with this amendment. Given the proximity to the Gardiner Expressway, such discussions will need to involve Works and Emergency Services, as well as Urban Planning and Development Services.

2.Sign Relocation from Ellis Avenue

At its meeting of January 29, 1999, the Board of Governors of Exhibition Place adopted recommendations involving an arrangement with the firm of Gallop & Gallop Advertising, Inc., to relocate an existing sign from a property owned by Stelco at Lake Shore Boulevard and Ellis Avenue to the proposed location at Exhibition Place. These recommendations addressed financial matters including a length of term, the need for City Council approval and the coming into force of any required amendments.

It is clear that the relocation of this sign to Exhibition Place offers the opportunity for Exhibition Place to achieve significant economic benefits and eliminates the problem for local west-end residents. However, I believe that in a number of ways this will set a bad precedent from a planning perspective.

3.Official Plan Policies

The former City of Toronto Part I Official Plan has numerous policies to support the appropriate and sensitive development of Exhibition Place. Section 14.13 states that it is Council's policy to support initiatives which will improve the physical attractiveness of the Exhibition District through such means as the location and design of buildings, a comprehensive landscaping scheme and the preservation and enhancement of historical buildings, structures, places and monuments.

The prominence of this area is also addressed in Section 3.5 of the Official Plan which discussed the enhancement of well known and highly visible areas, sites, buildings, structures or landscapes that give the City and its neighbourhoods distinctiveness. These areas are designated on Map 4 as prominent areas and sites. Map 4 specifically lists "The Fort York Area and surrounds, including Strachan Avenue between the rail corridor and Lake Shore Boulevard." This suggests that any development in the area should respect prominent views and sensitively address the existing built form and potential development opportunities.

I am concerned that the proposed sign is not consistent with these policies - it will be visible from historic Fort York, will impede the improvement of the Strachan Avenue corridor which forms the entrance to the Princes' Gates, and also represents poor development of the historic Exhibition Place grounds.

The position of the Official Plan is supported by the work of the former Royal Commission on the Future of the Toronto Waterfront in its Preliminary Master Plan for the Garrison Common Area.

4.Chapter 297 of the Municipal Code

The sign does not comply with Chapter 297 of the Municipal Code in the following ways:

1.a ground sign used for the purposes of third party advertising with tri-vision panels,

an electronic message display copy and changeable copy is not permitted in a Parks district;

2.the area of the proposed ground sign (259 square metres) exceeds the maximum permitted area of 25 square metres by 234 square metres;

3.the height of the sign above grade (35 metres) exceeds the maximum permitted height of 9 metres by 26 metres.

The proposal generates significant variances that, in my opinion, are not minor. The Municipal Code has restrictive signage provisions for Parks districts befitting their primary function as places for use by the public for recreational purposes. Exhibition Place is a large park with a regional draw. As I have previously acknowledged in my report of December 9, 1998, entitled "Approval in Principle for a signage program for Exhibition Place", the "G" designation does not fully address the unique character and activities that occur at Exhibition Place and the corresponding need for signage of another order. Nevertheless, third party electronic signage of this scale was never anticipated as being appropriate for Exhibition Place.

In addition, there is a complementary restriction in areas along the Gardiner Expressway and Don Valley Parkway corridors that no ground sign be higher than 9 metres or larger than 25 square metres regardless of the land use designation. This would be the second sign of its type on the south side of the Gardiner. These restrictions resulted from a concern that signs were increasingly obstructing the panoramic views along the Gardiner Expressway and the Don Valley Parkway, the City's gateway corridors.

5.Former Metro By-law 211-79

The former Metro By-law 211-79 prohibits commercial signage along all former Metro roads and within 45 metres of the Gardiner Expressway and Don Valley Parkway. The intent of this by-law is to protect aesthetically sensitive areas such as parks and major city gateways as well as to ensure safe traffic movement.

On August 13, 1997, Metro Council approved the construction of a single electronic billboard sign (the Omni sign) on Manitoba Drive at Exhibition Place but at the same time asked that a comprehensive review of signage at Exhibition Place be undertaken. It should be noted that the proposed Gallop & Gallop sign has a sign face that is 256 square metres in comparison to the Omni Sign which is 127 square metres.

Works and Emergency Services staff have advised that it is inappropriate to grant a variance to this by-law which is intended to ensure safe traffic movement and preserve appropriate site lines along the Gardiner.

6.New Signage Proposal for Exhibition Place

City Council at its meeting of December 16, 1998 adopted a new approach for signage at Exhibition Place. This approach included a place for third party advertising, within the context of an appropriately designed overall format and an Exhibition Place header. I understand that that approach is currently being refined by Exhibition Place staff in order to send out a request for proposals to the signage industry.

A large electronic billboard sign was not included as part of the signage proposal. The sign being proposed now does not meet any of the criteria for signage endorsed by City Council.

7.Heritage Policies

Heritage Toronto staff do not support the relocation of the sign to this site at Exhibition Place.

Heritage Toronto does not support amendments to By-law 211-79 and is on record as objecting to amendments which would allow signs of this type in this location.

Staff have informed me that, as was the case with the new advertising sign near the Dufferin gate, the height, size and location of the proposed sign near Strachan Avenue detracts from the historic nature of this area, which contains many buildings that are on the City of Toronto's Inventory of Heritage Properties.

8.Exhibition Place - Program and Development Concept

In May of 1999, Urban Planning and Development Services staff, O & Y- SMG Canada and Exhibition Place staff prepared a Program and Development Concept for the Board of Governors of Exhibition Place which they subsequently adopted. This plan identified the Strachan Avenue corridor as public open space to be retained, consistent with the approach mentioned in the Official Plan and Garrison Common Master Plan. In addition, the document refers to the General Services building as Site 13, a potential redevelopment site.

I believe that the location of the sign on Strachan Avenue not only interferes with the public space objectives envisioned here but could compromise the potential redevelopment of this site.

Conclusion:

For the reasons discussed above, I am recommending refusal of the requested variance and any amendment to the former Metro By-law 211-79.

Contact Name:

Elyse Parker

Telephone: (416) 392-0069

Fax: (416) 392-1330

E-Mail: eparker@toronto.ca

Insert Table/Map No. 1

Exhibition Place

Insert Table/Map No. 2

Exhibition Place

Insert Table/Map No. 3

Exhibition Place

Insert Table/Map No. 4

Exhibition Place

The Toronto Community Council also submits the following communication (February21,1999) from the Interim General Manager, Exhibition Place:

Further to your discussion with Fatima Scagnol on February 12, 1999, this letter supercedes my previous letter dated February 7, 1999.

Attached find report with respect to the above. This report was considered and approved by The Board of Governors of Exhibition Place at its meeting of Friday, January 29, 1999.

As noted in subject report, The Board is requesting that:

(a)recommendations 1, 2, and 3 of subject report be submitted to the City's Economic Development Committee;

(b)recommendation 4 of subject report be submitted to the Toronto Community Council; and

(c)the reports of the Economic Development Committee and Toronto Community Council Committee related to this sign be submitted to the City Council at the same time.

The Chair of the Board, Councillor Joe Pantalone, has requested that the above-noted recommendations be accompanied with the report to be submitted by Paul Bedford, Executive Director/City Planning.

If you require any additional information, please do not hesitate to contact me at 393-6011.

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(Report dated February 1, 1999 from the Interim General Manager, Exhibition Place)

Purpose:

This report is submitted for the consideration and approval by the City Council.

At its meeting of January 29, 1999, the Board of Governors of Exhibition Place considered and approved a report entitled "Relocation of the Advertising Sign from High Park Area to Exhibition Place." At that same meeting, the Board also approved the following motions concerning the recommendations below:

(a)recommendations 1, 2, and 3, of subject report be submitted to the City's Economic Development Committee;

(b)recommendation 4 of subject report be submitted to the Toronto Community Council; and

(c)the reports of the Economic Development Committee and Toronto Community Council Committee related to this sign be submitted to the City Council at the same time.

Recommendations:

It is recommended that:

(1)The Board enter into an agreement with Gallop and Gallop Advertising, Inc. ("Gallop") to construct, install and maintain a billboard advertising sign on Exhibition Place grounds subject to the approval of City Council and the coming into force of any amendments which may be required pursuant to recommendation 4;

(2)The Board approve of the Term Sheet attached as Appendix "A" hereto as the basic terms and conditions to be included in any agreement between the Board and Gallop;

(3)The City of Toronto Council authorize the Board to enter into an agreement with Gallop for an initial term of 9 years, with an option to negotiate an additional 8 years;

(4)The City Solicitor be requested to prepare a draft sign by-law amendment in substantially the form attached as Appendix "B" hereto to be forwarded by the Board to City Council with its request for approval; and further that, the City of Toronto Council approve any amendment to the Toronto sign by-law, as outlined in Appendix "B" of this report, that may be necessary to permit the relocation of the sign to Exhibition Place;

(5)As required in the Term Sheet set out in recommendation (2), the City Solicitor be requested to inform the Board when a final settlement of the litigation between the City, Stelco and Gallop is reached that is satisfactory to the City; and

(6)The appropriate officials be authorized and directed to take the necessary action to give effect thereto.

Background

In 1987 the City of Toronto issued a permit to Gallop to erect an advertising sign on a property owned by Stelco near the corner of Lakeshore Blvd. and Ellis Avenue. The sign is the only one of its kind in the area. Local residents have strongly objected to the location of the sign and are supported by local Ward Councilors and the City of Toronto in their efforts to have the sign removed from this location.

In an effort to negotiate a mutually agreeable resolution to the matter discussions have been ongoing between the City Solicitor and Gallop. During these discussions the notion of relocating the sign to another location was considered. Gallop have submitted a proposal to relocate the sign at Exhibition Place on a site immediately to the east of the General Services Building near Strachan Avenue. This location overlooks the Gardiner Expressway. Subject to the Board's approval the local Ward Councillors are in agreement with the concept of moving the sign.

Discussion:

Staff have met with Mr. Tom Rothfels, Executive Vice President of Gallop to discuss the proposal in detail. Staff have relied on the recent Omni agreement to serve as a basis for negotiations with Gallop. The offer by Gallop is outlined below and a comparison to the Omni agreement is detailed in this report.

1.Design Characteristics and Dimensions

Gallop has existing advertising contracts with Ford Motor Company and Panasonic Electronics which expire on December 31, 2008. The dimensions of the Gallop sign are as follows: on the "Ford " side, the message centre at the bottom of the sign is 5.5 ft. x 60 ft.; the trivision above that is 24 ft. x 60 ft.; and the illuminated logo above that is approximately 14 ft. x 36 ft. The Panasonic side does not have a trivision and the advertising board is approximately 35 ft. by 60 ft. with a similar sized message centre underneath and the Panasonic logo above. Illustrations of the sign faces and location are provided as Appendix "C" and "D". While Gallop has indicated that they would design a new pole structure to match the design of the Omni sign, the existing design of the sign face and dimensions will remain as is.

As a basis for comparison the Panasonic side of the sign face covers an area of approximately 2,430 sq. ft.; the Omni sign is 1,376 sq. ft per side.

2.Allocation of Advertising Space to Exhibition Place

Gallop's existing advertising contracts commit 100 per cent of the electronic message centre usage to Ford and Panasonic. Gallop have indicated that they will use best efforts to obtain 10 per cent of the message centre time for the use of the Board.

3.Term

Gallop has proposed an initial term of nine years to coincide with their existing advertising contracts and an option to negotiate an 8-year extension in the final year of the initial term. This is similar to the provision in the Omni agreement and will require City Council authority.

4.Ownership of the Sign

At the end of the initial 9-year term the Board would have the right to purchase the Gallop sign for $650,000 or direct Gallop to remove the sign. If the term were extended for an additional 8 years, ownership of the sign would be transferred to the Board at the end of the renewal term. These provisions are similar to the terms of the Omni agreement. The cost to the Board of purchasing the sign at the end of the initial term is higher than the Omni agreement due to the larger size of the Gallop sign.

5.Guaranteed Annual Payment to the Board

For purposes of comparison in years one to nine the Gallop offer would provide a total guaranteed base revenue of $1,800,000 to the Board; the Omni agreement provides a guaranteed payment of $1,275,600 over the same 9 year period.

6.Additional Payments to the Board

Gallop has offered the Board 30 per cent of gross revenues in excess of $950,000 per annum. However, since Gallop has existing long term contracts with its advertisers until the end of the initial term and as these existing contracts do not exceed $950,000 per annum there is little likelihood of any additional revenues to the Board. The opportunity for additional revenues would only occur if Ford and/or Panasonic were to cancel their advertising contracts and Gallop were to find advertisers that would generate in excess of $950,000. This scenario is unlikely.

The Omni agreement provides for a lower base rent than that being offered by Gallop but provides for 30 per cent of gross revenues over a base amount of $521,426 in years one to three with adjustments in future years. In its first year of operation Omni has been able to sell the advertising rights on its sign to Belair Direct and Bell Mobility at a rate that will generate an additional $77,572 for the Board, bringing the Board's first year revenues for the sign to $213,822. It is difficult to predict whether or not Omni can continue to renew these contracts at the existing rates.

Gallop has indicated that the advertising industry is very cyclical in nature and typically the industry offers a relatively low base rental amount with a percentage revenue clause to proved protection from having to pay high base rental amounts during the bad years. Accordingly, Gallop has entered into long term agreements with its advertisers which lock in their revenues at a fixed amount. Gallop claims that while this strategy does not provide high returns during the good years it does guarantee a higher return during the bad years and provides a consistent level of revenue from year to year.

7.Additional Benefits to the Board

The Omni agreement provides the Board with $50,000 in advertising on its network of billboards in the GTA and Montreal.

Gallop does not own any other billboard advertising, however they have offered $75,000 advertising space on its network of 15,000 "Flashposters" located in convenience stores, supermarkets, gas bars etc., across Canada. These 32 inch x 24 inch "poster" boards are located in high traffic areas in doors, windows and exterior walls of some 7,000 independent stores across the country. Alternatively the Board would also have the option of utilizing up to $75,000 in advertising with Gallop's Internet advertising company, Virtual Billboard Network.

Gallop Offer and a Comparison to the Omni Agreement

At its meeting of January 21, 1999, the Executive Committee requested further information with respect to the relocation of the Gallop sign at Exhibition Place. The issues raised by the Executive Committee all had legal implications and consequently the following report from the Interim General Manager was written with input from and concurrence by the City Solicitor respecting the substance of the responses discussed below.

(a)Terms of Existing Gallop Lease

The Gallop sign is presently located on lands owned by Stelco near High Park. Presently, Gallop pays annual rent to Stelco of $125,000 which is less than the rent being offered to the Board. The term of the lease between Stelco and Gallop has expired and Gallop has not renewed but is on a month-to-month tenancy.

(b)Litigation between Gallop, Stelco and the City

As indicated in report entitled "Relocation of Advertising Sign from High Park Area to Exhibition Place", the City of Toronto has taken the position that the sign currently erected on the Stelco property at 6 Windermere Avenue is contrary to the City's sign regulations. The Chief Building Official revoked the building permit for the sign in 1997 on the basis that it had been issued on mistaken information, thereby rendering the installation contrary to the Building Code Act. In response, Stelco and Gallop jointly brought a Court Application against the City, Metro and the Chief Building Official seeking to have the Court rescind the Chief Building Official's order revoking the building permit. The former City of Toronto then brought a Counter-Application seeking a Court Order to require Stelco and Gallop to remove the sign within 60 days, and permitting the City to remove it should they fail to do so and place the cost on the Tax Roll to be assessed against the Stelco property. Neither the Application nor Counter-Application has been heard by the Court. Instead, discussions have taken place between the City and Stelco and Gallop at various times with respect to negotiating the removal of the sign. The City takes the position that a settlement has been agreed to which would see the removal of the sign by, at the latest, June, 2003. The Term Sheet attached provides that before any agreement between the Board and Gallop may take effect, a settlement must be finalized between Stelco, Gallop and the City with respect to the sign on the Stelco lands.

(c)International Sports Mall Proposal

At its meeting in May, 1998, the Board took the position that it would not consider releasing to Sports Mall any rights to billboard sign revenue. As the Board is aware, the Sports Mall proposal, which was not accepted by the Board, was not a "sign" proposal but a proposal to construct an entertainment complex. Therefore, it is the opinion of staff and the City Solicitor that Sports Mall has no basis for attempting to restrict the Board with respect to any other process or arrangement which it may choose to initiate concerning signage.

In addition, Omni, in its agreement with the Board, also has no exclusive rights to signage at Exhibition Place.

(d)Terms & Conditions

The Terms Sheet attached as Appendix "A" outlines basic substantial terms and conditions which are both particular to the Gallop proposal and general terms in keeping with the agreement between the Board and Omni. Gallop has agreed in principle to all the terms and conditions contained in this Terms Sheet.

(e)Amendments to Sign By-Law

As with the Omni sign, an amendment shall be required to By-law No. 211-79 of the former Municipality of Metropolitan Toronto which prohibits and regulates signage on lands within 45 metres of the Gardiner Expressway. Although the Metro\City split jurisdiction situation no longer exists, Municipal Code Chapter 267, Signs, of the former City of Toronto still contains a provision exempting those lands which are covered by By-law No. 211-79. The City Solicitor has therefore prepared a draft amendment which is attached for your consideration to permit the erection of one double-faced sign. The Map to be attached to this amendment shall be prepared prior to the introduction of the bill in Council.

As By-law No. 211-79 is a by-law passed under section 34 of the Planning Act, the process for amending a zoning by-law must be followed: Notice of the proposed by-law must be given and a public meeting held. After the by-law is enacted, notice thereof must be given to the persons and public bodies as prescribed. Any person or public body may appeal the by-law to the Municipal Board.

The above-noted clarifies issues raised at the Executive Committee of January 29, 1999 concerning the Gallop sign. Entering an agreement with Gallop for relocation of its sign at Exhibition Place provides revenue opportunities for the Board and also assists the City of Toronto by settling a long-standing court action.

Conclusion:

The Gallop proposal provides the Board with a consistent annual source of revenues totaling $1.8 million dollars over a 9-year period with an additional $675,000 in Flashposter or Internet advertising that would be made available for Exhibition Place programs. In addition, should Gallop be able to secure 10 per cent of the advertising on the electronic message centre for the use of Exhibition Place this will provide additional benefits to our consumer and trade show tenants and the Canadian National Exhibition.

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Appendix "A"

Term Sheet

1.Subject:

An agreement to provide for the construction, installation and maintenance of a sign to be erected at Exhibition Place west of Strachan Avenue within 45 metres of the southerly limit of the Gardiner Expressway.

2.Parties:

The Board of Governors of Exhibition Place (the "Board") and Gallop & Gallop Advertising Inc. ("Gallop").

3.Preconditions:

a.City Council approval is required for the Board to enter into this Agreement.

b.The entering into of the agreement shall be contingent upon:

(i)The entering into of a settlement agreement between the City of Toronto, Gallop and Stelco Inc. with respect to the Applications (Court File No. 97-CU-123846) brought by the parties which settlement is satisfactory to the City Solicitor.

(ii)The coming into force of the required by-law amendments to allow for the erection of the Sign on Exhibition Place.

(iii)The existing sign being removed by Gallop from the Stelco lands.

4.Sign:

Gallop shall construct and maintain at its cost a double-sided vee-shaped outdoor sign supported by a single pole as illustrated on Schedule "A" attached with the following characteristics:

a.The display areas on the east side of the Sign shall be comprised of:

(i)an internally illuminated curved panel above the main horizontal sign approximately 14 feet high and 36 feet wide, (the "Logo Panel");

(ii)a tri-vision panel across the central part of the main horizontal sign, illuminated from the bottom of the main horizontal sign, displaying advertising messages and approximately 24 feet high and 60 feet long (the "Trivision Panel"); and

(iii)an electronic sign across the lower part of the main horizontal sign displaying advertising messages approximately 5.5 feet high and 60 feet long (the "Message Centre").

b.The display areas on the west side of the Sign shall be comprised of:

(i)a billboard panel across the central part of the main horizontal sign, illuminated from the bottom of the main horizontal sign, displaying advertising messages and approximately 35 feet high and 68 feet long (the "Billboard Panel"), and

(ii)an electronic sign across the lower part of the main horizontal sign displaying advertising messages approximately 5.5 feet high and 68 feet long (the "Message Centre").

c.Gallop shall design and submit for the approval of the Board, a new pole structure for the Sign which will be similar to the design of the Omni sign also located on Exhibition Place lands.

5.Location and Height:

a.The Sign shall not exceed a height of 92 feet measured from grade to the top of the highest point.

b.No part of the Sign shall be erected closer than 45 feet to the southerly limit of the structure supporting the Gardiner Expressway.

c.The Sign shall be located within the permitted limits of the by-law as amended and as the parties mutually agree within those limits.

6.Approvals:

Gallop shall, as directed by the Board, seek comments and suggestions on the overall nature, size and location of the sign from the Commissioner of Urban Planning and Development Services and/or the Commissioner of Works and Emergency Services for the City of Toronto. Gallop and the Board shall mutually co-operate in making modifications to the sign and the terms and conditions set out herein in response to any suggestions or comments.

7.Specifications:

Gallop shall prepare detailed specifications for the construction of the sign for the approval of the Board, acting reasonably, which general specifications be comprised of the following parts:

8.Operation of Message Centre:

The remote control of the Message Centres shall be located in the offices of Gallop or Gallop's subcontractors located within the City of Toronto. The parties shall, in the event that the Board obtains the use of ten percent (10%) of both of the Message Centres, at that time negotiate and settle operating procedures.

9.Construction of the Sign:

Gallop shall at its cost:

(i)be responsible for carrying out the construction and erection of the sign;

(ii)prepare all necessary drawing and specifications and seek all required approvals and permits required to permit the sign to be erected and pay all fees to third parties as required by law;

(iii)provide a labour and material payment bond and a performance bond each in an amount equal to the cost of the cost of constructing and erecting the sign including all costs of electrical connections and making the sign fully operational;

(iv)provide evidence of comprehensive liability insurance and builder's risk insurance in such amounts and coverages as the Treasurer and Chief Financial Officer of the City of Toronto may require, acting reasonably; and

(v)carry out and complete construction in accordance with Schedule "D" attached.

Gallop shall not take any action which would place the Board in default of its obligations under various collective agreements binding upon the Board. The Board shall inform Gallop of specific collective agreements.

10.Operating and Maintenance Costs:

Gallop shall be responsible for operating and maintaining the Sign and for paying all costs thereby incurred.

Gallop shall be responsible for securing advertisers for the Sign and for paying all costs, including commissions, thereby incurred.

Gallop shall be responsible for all taxes and similar impositions, including any realty taxes, if exigible, and any present or future impositions, which may arise out of the erection of the Sign. In the event of the imposition of any realty taxes in respect of the Sign, Gallop shall be entitled at its expense, to appeal same.

Gallop shall be responsible for the cost of the electrical hook-up of the Sign and the installation of a separate meter and the cost of all electricity used in connection with the Sign.

11.Insurance:

Gallop shall provide and maintain:

a.Comprehensive public liability insurance and property damage insurance in the amount of $5,000,000.00 per occurrence and naming the Board, O&Y-SMG Canada the Canadian National Exhibition Association and the City of Toronto as separate insureds with a provision for cross liability and severability of interests and with coverages as the Treasurer and Chief Financial Officer of the City of Toronto may require, acting reasonably.

b. Property insurance covering the full replacement cost of the Sign with coverage against all risks of physical damages, naming Gallop, the Board and the City of Toronto as additional named insured as their respective interests appear. The insurance shall contain such exclusions and deductible amounts and other provisions as may be approved by the Treasurer and Chief Financial Officer of the City of Toronto, acting reasonably

c.Builder's risk insurance insuring the Sign, and the cost of its erection for the full replacement cost against all risks of physical damage and other risks in a form and with such deductibles that meet with the Approval of the Board, at least 15 days prior to commencing any construction on the site, acting reasonably.

12.Ownership of Sign:

a.Throughout the Term (as hereinafter defined), Gallop shall be the owner of the Sign.

b.At the end of the initial Term, the Board shall have the option to:

(i)purchase the Sign for the sum of $650,000.00., which option shall be exercised by notice delivered by the Board to Gallop not less than 90 days prior to the end of the Term with the purchase price payable on the last day of the Term; or

(ii)direct Gallop, at its expense, to remove the Sign and restore the lands to their former condition within 30 days after the end of the Term.

c.In the event that the initial Term is extended for the additional 8-year renewal term, Gallop shall, without compensation, transfer ownership of the Sign to the Board at the end of the renewal term.

13.Revenues and Fees:

a.Subject to the payment of the fees payable to the Board, Gallop shall be entitled to all revenues derived from the sale of advertising on the sign.

b.Gallop shall pay the Board an annual fee (the "Base Fee") in each of the years set out in Column I below as follows:

Contract Year means successive periods of one year that commence on the first day of the Term and on each annual anniversary of the first day of the Term thereafter.

The Base Fee shall be re-negotiated for the Contract Years during any renewal term.

c.In addition to the Base Fee, Gallop shall pay the Board a fee equal to 30 percent (30%) of the amount that the Gross Revenues in each of the Contract Years set out in Column I above exceeds $950,000.00 (the "Additional Fee"), provided that one of the following has occurred:

(i)The advertising agreements with Panasonic and Ford existing on the date of execution of this Agreement are terminated during the Term.

(ii)The rent payable under the advertising agreements with Panasonic and Ford existing on the date of execution of this Agreement are increased during the Term.

"Gross Revenues" means all revenues derived from the sale of advertising on the sign before deducting any expenses, including sales commission, incurred to earn such revenues, but not including the following:

(i)Agency commissions payable to third parties;

(ii)GST, taxes and other impositions remitted by Gallop; and

(iii)Production costs for the manufacturing of advertising material, not including any mark-up charged by Gallop for such manufacturing.

d.The Base Fee under (b) shall be paid annually in advance.

e.Within 45 days following the end of each Contract Year, Gallop shall deliver to the Board a statement showing the computation of any Additional Fee payable under (c) together with payment of the Additional Fees so computed. Gallop shall produce statements verified by a duly licenced accountant within 120 days, following the end of the Contract Year verifying the initial statements or disclosing any adjustments required. The parties shall make any required adjustments. The Board shall have a right of reasonable access by its own auditor to Gallop's books to verify Gallop's obligations under the Agreement.

f.Interest at 2 per cent over the Royal Bank's prime rate shall be payable on overdue amounts.

14.Other Benefits for the Board:

a.Gallop represents that it owns and operates a network of 15,000 poster boards ("Flashposters") located in high traffic areas on the doors, windows and exterior walls of some 7,000 convenience stores, supermarkets, gas bars, etc. across Canada, and an internet advertising company ("Virtual Billboard Network") which provides internet advertising services. Gallop shall provide free advertising to the Board in the form of poster boards or internet postings (at the Board's option) on poster boards owned by Gallop in locations that the Board and Gallop may agree upon or on the internet. The value of such advertising shall equal approximately $75,000.00 per Contract Year, determined in accordance with Gallop's published rate cards in effect from time to time in the area where the poster board is located or with respect to internet postings. In the event that Gallop is unable to supply its own poster board or internet advertising, then the same may be supplied on similar media acceptable to the Board. The parties shall co-operate fully in each year during the Term to permit the Board to utilize fully the advertising rights hereunder. The Board shall be responsible for the cost of creating the poster or internet advertising only (i.e. excluding the cost of pasting the poster to the poster board or posting the advertising to the internet).

b.Gallop shall make its best efforts to provide the Board with the free use of ten percent (10%) of the time on both Message Boards during the Term. In the event that one or both of the existing advertising agreements is or are terminated prior to the end of the Term, the Board shall automatically be entitled to the free use of ten percent (10%) of the time on one or both Message Boards, at such prime times during the day as the Board may desire, for the remainder of the Term.

15.Purchase of Additional Advertising by Board:

Gallop grants the Board the right to purchase, at competitive rates, the rights to advertise on the Logo Panel, Message Centres (in addition to the free 10%), Trivision Panel or Billboard Panel of the Sign provided that the right is exercised within 30 days following the termination of an existing advertising agreement or the end of the term of any agreement which Gallop has entered with a third party for the sale of such advertising rights during the Term. Gallop shall provide the Board with prior notice of the termination of an existing or future advertising agreement with a third party during the Term, not more than 3 business days after Gallop has received notice of termination.

16.Term:

a.The agreement shall be for a term of 9 years commencing on the first day of the month following the date the sign is erected and operating to the satisfaction of the General Manager (the "Commencement Date").

b.The parties agree that following testing of the operation of the sign, some deficiencies may exist and that the General Manager may indicate satisfaction under (a) subject to indicated deficiencies being corrected within a stipulated time and, provided the sign is being used for the purposes intended, the Commencement Date shall be the first day of the immediately following month.

c.The Agreement may, at the option of the Board, be renewed by agreement of the parties for a further period of 8 years on the terms and conditions then current, with the exception of the Base Fee, which shall be re-negotiated. In the event that the Board does not wish to renew the Agreement, it shall give Gallop 6 months' notice before the end of the Term. If the parties attempt and fail to agree to an extension during prior to the last day of the Term, all obligations of both parties in respect thereof shall be at an end. Extension shall be subject to the approval of the Council of the City of Toronto.

17.Board's Security:

Gallop shall provide to the Board a clean, irrevocable letter of credit in the amount of $50,000.00 to secure Gallop's obligations to negotiate in good faith to conclude a formal agreement and to carry out the construction and installation of the sign. The letter of credit shall be in a form satisfactory to the City Solicitor and the Treasurer and the Chief Financial Officer of the City of Toronto, acting reasonably.

The parties agree that if Gallop breaches its obligations secured by the letter of credit, the Board will suffer damages which are pre-estimated and agreed to by the parties the amount of the letter of credit.

Once the Sign is erected in accordance with the Agreement and the payment of the Base Fee in respect of Contract Year 1 is made as provided under section 13(d), the letter of credit shall be surrendered.

18.Indemnity

Gallop shall indemnify the Board, O&Y-SMG Canada, the Canadian National Exhibition Association and the City of Toronto, their officers, employees and agents (collectively the "Indemnitees"), and save them harmless from any loss, claims, judgements or damages suffered by the Indemnitees by reason of their entering into this Agreement or the failure of Gallop to fulfil its obligations under this Agreement, and this indemnity shall specifically cover any claims by Stelco Inc. or any other party which might be made against the Indemnitees as a result of the relocation of the Sign from the Stelco Lands.

19.Advertising Guidelines:

Gallop shall, with respect to new advertising agreement with third parties entered into during the Term, comply with the Advertising Guidelines attached as Schedule "C" to this Term Sheet.

20.Permitted Assignment/Condition on Assignment:

a.The rights under the Agreement shall not be assigned by Gallop without the prior consent in writing of the Board. The consent of the Board shall not be unreasonably withheld provided that Gallop shall remain jointly and severally liable with any permitted assignee with respect to the performance of all the terms and conditions of the Agreement. A change in corporate ownership or control of Gallop, other than an initial public offering, shall be deemed to be an assignment of the Agreement requiring consent under this provision. The Board may, at its option, terminate the Agreement if Gallop assigns the Agreement without the Board's prior written consent.

b.Despite section (a), where Gallop sells, transfers, leases or otherwise assigns the Sign or any rights therein to any third party who owns or controls outdoor advertising signs, Gallop shall ensure that as one condition of any such sale, transfer, lease or assignment, such third party is obligated to provide to the Board free advertising rights on such outdoor advertising signs which would be equal or equivalent to the message board advertising space controlled by the Board on the Omni sign presently located at Exhibition Place, as determined by the Board, acting reasonably, failing which the Board may withhold its consent to such sale, transfer, lease or assignment.

21.General:

The final agreement will contain terms usual to a commercial agreement including a force majeure clause, notice provisions, applicable law (Ontario), warranties by Gallop that it has experience and expertise appropriate to its obligations under the contract and by the Board as to its authority to enter the agreement, and Gallop and Board approvals to be exercised by a designated official.

List of Schedules

Schedule "A"Sketch of Sign

Schedule "B"Specifications for the Sign

Part 1:Overall Sign Structure (including pole)

Part 2:The Logo Panel

Part 3:The Trivision Panel

Part 4:The Message Centre (East)

Part 5:The Billboard Panel

Part 6: The Message Centre (West)

Schedule "C"Advertising Guidelines

Schedule "D"Construction Schedule

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Appendix "B"

CITY OF TORONTO

BY-LAW No.

The Council of the City of Toronto HEREBY ENACTS as follows:

To further amend By-lawNo.211-79 of the former Municipality of Metropolitan Toronto, being "A By-law to prohibit signs on lands adjacent to certain Metropolitan Roads" to permit the erection of a sign on Exhibition Place within ___ metres west of Strachan Avenue.

WHEREAS By-law No. 211-79 was previously amended by By-law No. 106-97 of the former Metro to allow for the erection of a sign within certain lands located within 45 metres of the southerly limit of the Frederick G. Gardiner Expressway and within Exhibition Place; and

WHEREAS City Council has determined that it is appropriate that permission be granted for the erection of an additional double-faced faced sign at Exhibition Place within those lands; and

WHEREAS this by-law has therefore been enacted in accordance with the requirements of the Planning Act;

1.By-law No.211-79 of the former Municipality of Metropolitan Toronto, being "A By-law to prohibit signs on lands adjacent to certain Metropolitan Roads", is hereby amended by adding thereto the following section:

1b.(1)Notwithstanding section 1, the lands lying within 45 metres of the southerly limit of the Frederick G. Gardiner Expressway and within Exhibition Place as defined in subsection61(1) of the City of Toronto Act, 1997 (No. 2), S.O.1997, c.26 and within not less than ___ metres or more than ___ metres west of the westerly limit of Strachan Avenue as shown hatched on Map2 attached as Schedule "B" to this by-law may be used for the erection of not more than one double-faced sign at Exhibition Place for the purposes of:

(a)identifying the location of the National Trade Centre and Exhibition Place,

(b)informing the public of the events occurring in the National Trade Centre and at Exhibition Place, and

(c)advertising.

(2)Map 2, attached as Schedule"A", shall form part of this by-law.

ENACTED AND PASSED this day of , A.D. 1999.

___________________________________________

MayorCity Clerk

Insert Table/Map No. 1

Exhibition Place

Insert Table/Map No. 2

Exhibition Place