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2003/02/11 City Council Resolution (4)RESOLUTION NO. 2003 - 27 A RESOLUTION OF THE CITY OF ROHNERT PARK APPROVING THE SECOND AMENDMENT TO THE GROUND LEASE BETWEEN KSL ROHNERT PARK, LP, A CALIFORNIA LIMITED PARTNERSHIP ( "KISCO"), AND THE CITY OF ROHNERT PARK WHEREAS, on November 24, 1998; the City of Rohnert Park and the Rohnert Park Wellness Center entered into that certain Project Agreement and Ground Lease for a 9.92 acre site located on Medical Center Drive for the purposes of developing a Healthcare and Wellness Campus; and WHEREAS, on November 13, 2001; the City of Rohnert Park approved the assignment of the project agreement and ground lease dated November 24, 1998 by and between the City of Rohnert Park and the Rohnert Park Wellness Center to Kisco through the adoption of Resolution 2001 -236; and WHEREAS, on May 14, 2002; the City Council approved the First Amendment to the lease with Kisco providing the City of Rohnert Park additional compensation to lease the excess right of way at the same per square foot cost of the original lease; WHEREAS, Kisco has agreed to terms in the attached "Second Amendment to Amended and Restated Ground Lease" (Exhibit "A ") providing Kisco a restrictive purchase option on the Wellness Center; NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Rohnert Park that the City Manager is hereby authorized and directed to execute the Second Amendment to Amended and Restated Ground Lease. DULY AND REGULARLY ADOPTED this 1 lth day of February 2003. ATTEST: 2 FAI IRA CITY OF ROHNERT PARK FLORES: AYE MACKENZIE: AYE NORDIN: AYE SPRADLIN: AYE VIDAK- MARTINEZ: AYE AYES: (5) NOES: (0) ABSENT: (0) ABSTAIN: (0) Exhibit A to Resolution No. 2003 -27 SECOND AMENDMENT TO AMENDED AND RESTATED GROUND LEASE This SECOND AMENDMENT TO AMENDED AND RESTATED GROUND LEASE (this "Amendment ") is entered into effective as of February 11, 2003, by and between KSL Rohnert Park, LP, a California limited partnership ( "Kisco "), and the CITY OF ROHNERT PARK (the "City "). RECITALS A. Rohnert Park Wellness Center, LLC as Tenant entered into that certain ground lease with the City, as Landlord, dated November 24, 1998, (the "Original Lease "), for the lease of certain real property located on the northeast intersection of Rohnert Park Expressway and Snyder Lane, referred to in the original lease as the "Land ". B. RPWC assigned all of its right, title and interest in and to the Original Lease to Kisco pursuant to that certain Assignment and Assumption Agreement effective as of December 31, 2001 (the "Assignment "), and the City consented to such Assignment. A Memorandum of such Assignment was recorded in the Official Records of the County of Sonoma on December 28, 2001 as Instrument No. 2001180031. C. Kisco and City entered into that certain Amended and Restated Ground Lease effective as of December 31, 2001, whereby the terms and conditions of the Original Lease were amended and restated in their entirety. D. Kisco and City executed and acknowledged a Memorandum of Amended and Restated Ground Lease dated as of December 31, 2001, which was recorded in the Official Records of the County of Sonoma on December 28, 2001 as Instrument No. 200180030. E. Kisco and City entered into that certain First Amendment to Amended and Restated Ground Lease effective as of December 31, 2001 (the "First Amendment "), amending the terms and conditions of the Original Lease. The Amended and Restated Ground Lease, as amended, is hereinafter referred to as the "Lease." F. Kisco and City executed and acknowledged a Memorandum of First Amendment to Amended and Restated Ground Lease dated as of December 31, 2001, which was recorded in the Official Records of the County of Sonoma on January 14, 2003 as Instrument No. 2003008289. G. Kisco and City desire to amend the Lease further to grant to the Tenant an option to purchase the Land, subject to the terms and conditions set forth below. AGREEMENT In consideration of the above recitals and of the covenants and conditions contained herein, Kisco and City hereby agree as follows: Article VI. 1. Paragraph (b) of Article VI.1 is restated in its entirety as follows: (b) A Development Agreement will be required by and between Tenant and City. The agreement shall provide specific 08296.003.0027.1 requirements, consistent with the terms of this Lease, about the facilities to be constructed by Tenant, the time frame in which construction is to be completed and to delineate the responsibilities of the Tenant and City with respect to completion of the Campus project. In addition, such Development Agreement shall provide that if, prior to the issuance of a temporary or final certificate of occupancy for the Phase 1 Improvements, Tenant purchases the fee interest in the Land pursuant to the Purchase Option provided in Article XVI.2, any subsequent transfers of the fee interest prior to the issuance of a temporary or final certificate of occupancy for the Phase 1 Improvements shall require the consent of the City as and to the extent would be required for any assignment of Tenant's interest in this Lease as provided in Article VIII.3 through Article VIII.5 of this Lease. 2. Article XVI.I. Article XVI.1 is restated in its entirety as follows: XVI.I Right of First Refusal. (a) If, at any time during the Term of this Lease, Landlord shall receive a bona fide offer to purchase the Land, Landlord shall give Tenant written notice of the price and other material terms and conditions of such offer and of Landlord's intention to accept the same ( "Landlord's Notice "). Tenant shall have the right ( "Right of First Refusal ") for sixty (60) days following its receipt of Landlord's Notice to elect to purchase the Land for the purchase price and on the terms specified in Landlord's Notice. (b) Tenant shall exercise its Right of First Refusal, if at all, by delivery of written notice to Landlord (the "Acceptance "), in which case the Land shall be conveyed to Tenant on the business day specified in the Acceptance, which shall not be more than ninety (90) days, nor less than thirty (30) days, after the date upon which Tenant's Acceptance is delivered to Landlord. (c) Tenant's failure to deliver its Acceptance within such sixty (60) day period shall conclusively be deemed to be a rejection by Tenant of the offer set forth in Landlord's Notice. If Tenant fails to accept the terms of the offer set forth in Landlord's Notice, Landlord may make the sale or transfer upon the same terms and conditions as set forth in Landlord's Notice; provided that such sale or transfer shall be made subject to this Lease, including this Article XVI, and Tenant's Right of First Refusal shall be applicable to any and all subsequent offers to purchase the Land received by Landlord's successors and assigns. In any event, Tenant's failure to accept the terms of the offer as set forth in any Landlord's Notice shall not constitute a waiver of either Tenant's Right of First Refusal with respect to any future offers to purchase the Land received by Landlord's successors and assigns or Tenant's Purchase Option as provided in Article XVI.2. 08296.003.0027.1 2 (d) Within ten (10) business days of Tenant's Acceptance of the offer contained in any Landlord's Notice, the parties shall promptly open an escrow at the offices of a title company mutually satisfactory to the parties (the "Title Company'). The terms set forth in Landlord's Notice and in this Article XVI.1 shall constitute the Title Company's instructions. In addition, the Title Company shall prepare, and the parties hereby agree to execute, such reasonable and customary supplemental instructions and instruments, as may be reasonably required by the parties and the Title Company in order to clarify its duties hereunder and facilitate an orderly sale of the Land to Tenant. To the extent of any inconsistency between the provisions of such supplemental instructions and the provisions of this Article XVI.l, the provisions of this Article XVI.1 shall control. Unless the terms specified in Landlord's Notice provide otherwise, Landlord and Tenant shall each pay one -half of the escrow fees and costs, Landlord shall pay all transfer and documentary stamp taxes, Tenant shalf pay the cost of a standard title insurance policy in the amount of the purchase price; and all other closing costs shall be shared by the parties in accordance with the customary practice then in effect in Sonoma County. 3. Article XVI.2. A new Article XVI.2 is hereby added as follows: XVI.2 Option to Purchase. (a) Landlord hereby grants to Tenant an option (the "Purchase Option ") to purchase the Land for the Option Price (as defined below) on the terms, covenants and conditions set forth in this Article XVI.2. Subject to the provisions of Subparagraph (b) below, the Purchase Option may be exercised by Tenant by delivery of written notice to Landlord (the "Option Notice ") not earlier than January 1, 2005 (the "Option Commencement Date ") and not later than December 31, 2014 (the "Option Termination Date "). The period between the Option Commencement Date and the Option Termination Date is hereinafter referred to as the "Exercise Period ". Tenant's failure to deliver a valid Option Notice during the Exercise Period shall result in an automatic termination of the Purchase Option without further need of any documentation. (b) Tenant shall not have the right to exercise the Purchase Option prior to January 1, 2007, and any Option Notice delivered prior to that date shall be void, unless on the date of the Option Notice, the Treasury Rate is at least five percent (5 %). "Treasury Rate" means, as of any date of determination, the current yield per annum on United States Government Treasury securities having a maturity of ten (10) years (or as close as possible to ten (10) years) from such date as published in The Wall Street Journal, or if not so published, determined on the basis of comparable yields published 08296.003.0027.1 3 in a publication designated by Landlord as of such date. From and after January 1, 2007, this paragraph (b) shall be of no further force or effect, and the Tenant shall have the right to exercise the Purchase Option during the balance of the Exercise Period regardless of the Treasury Rate. (c) The "Option Price" shall be the Land Value (as defined below) on the date of the Option Notice; provided however, that the Option Price shall not be less than the Minimum Price (as defined below). The term "Land Value" means the fair market value of the fee interest in the Land without regard to the value of the Improvements, but subject to all the provisions of this Lease, determined as of the date of the Option Notice. The term "Minimum Price" means, for the entire Land, Three Million Sixty Three Thousand Five Hundred Thirty Two Dollars ($3,063,532.00); provided, however, that (i) if the Landlord has sold the fee interest in the Land to a third party after Tenant declines to exercise its Right of First Refusal pursuant to Article XVI.I above, then the Minimum Price shall be the purchase price paid by such third party for the Land, and (ii) at such time as the Land has been Subdivided, the Minimum Price for the entire Land set forth above shall be allocated between the Phase 1 Land and the Phase 2 Land, and the Minimum Price applicable to the Phase 1 Land shall be the Pro Rata Share applicable to the Phase 1 Land. Following the exercise of the Option, Landlord and Tenant shall attempt in good faith to agree upon the Land Value. If the parties reach an agreement as to the Land Value, they shall promptly execute a written instrument to evidence such agreement, and such written instrument shall constitute a conclusive determination of the Option Price. (d) If the parties have not agreed on the Land Value by the date thirty (30) days after the Option Notice, either party may, by notice to the other party (the "Option Appraisal Notice "), submit the determination of the Land Value to the appraisal and arbitration process as follows: (i) Appointment of Appraisers; Appraisal Instructions. Each party shall appoint one (1) appraiser within thirty (30) days after the date of the Option Appraisal Notice. Upon selecting its appraiser, each party shall promptly notify the other party in writing of the name of the appraiser selected. Each such appraiser shall be competent, licensed, qualified by training and experience, disinterested and independent, and shall be a member in good standing of the Appraisal Institute (MAI), or, if the Appraisal Institute no longer exists, shall hold the senior professional designation awarded by the most prominent organization of appraisal professionals then awarding professional designations. If either party fails to appoint its appraiser within such 30 -day period, the appraiser appointed by the other party shall individually 08296.003.0027.1 4 determine the Land Value in accordance with the provisions hereof. Each appraiser will make an independent determination of the Land Value. The appraisers may share and have access to objective information in preparing their appraisals, but they will independently determine the appropriate assumptions to make based on the provisions of this Section of this Lease and each appraiser's own assessment of the market. Neither of the appraisers shall have access to the appraisal of the other (except for the sharing of objective information contained in such appraisals) until both of the appraisals are submitted in accordance with the provisions of this Section. Neither party shall communicate with the appraiser appointed by the other party regarding the instructions contained in this Section before the appraisers complete their appraisals. If either appraiser has questions regarding the instructions in this Section or the interpretation of this Lease, such appraiser shall use his or her own professional judgment and shall make clear all assumptions upon which his or her professional conclusions are based, including any supplemental instructions or interpretative guidance received from the party appointing such appraiser. There shall not be any arbitration or adjudication of the instructions to the appraisers contained in this Section. Each appraiser shall complete, sign and submit its written appraisal setting forth the Land Value to the Parties within sixty (60) days after the appointment of the last of such appraisers. If the higher appraised Land Value is not more than one hundred ten percent (110 %) of the lower appraised Land Value, then the Land Value shall be the average of such two (2) Land Value figures. (ii) Arbitration. If the higher appraised Land Value is more than one hundred ten percent (110 %) of the lower appraised Land Value, and if the Parties do not first agree on the Land Value, then the Parties shall agree upon and appoint an independent arbitrator within thirty (30) days after both of the first two (2) appraisals have been submitted to the Parties. The arbitrator shall have the minimum qualifications as required of an appraiser pursuant to paragraph (i) above, and shall also have experience acting as an arbitrator of disputes involving commercial real estate, including ground leases and rental valuation. If the Parties do not agree upon and appoint such arbitrator within such 30 -day period, then either party may apply to the Superior Court of the State of California in and for the County of Sonoma for appointment of an arbitrator meeting the foregoing qualifications. If the court denies or otherwise refuses to act upon such application, either party may apply to the American Arbitration Association, or any similar provider of professional commercial arbitration services, for appointment in accordance with the rules and procedures of such organization of an independent arbitrator meeting the foregoing qualifications. Such arbitrator shall consider the appraisals submitted by the Parties, but no other documentation other than that contained in the appraisal reports shall be considered. Neither 08296.003.0027.1 5 party shall conduct ex parte communications with the arbitrator regarding the subject matter of the arbitration. Within thirty (30) days after his or her appointment, the arbitrator shall conduct a hearing, at which Landlord and Tenant may each make supplemental oral presentations, with an opportunity for testimony by the appraisers and questioning by the Parties and the arbitrator. Within thirty (30) days following the hearing; the arbitrator shall select the appraised Land Value determined by one or the other of the first two (2) appraisers that is the closer, in the opinion of the arbitrator, to the actual Land Value. The determination of the arbitrator shall be limited solely to the issue of deciding which of the appraisals of the two appraisers is closest to the actual Land Value. The arbitrator shall have no right to propose a middle ground or to modify either of the two appraisals, or any provision of this Lease. (iii) Conclusive Determination. Except as provided in California Code of Civil Procedure Section 1286.2 (as the same may be amended from time to time), the determination of the Land Value by appraisal or arbitration shall be conclusive, final and binding on the Parties. Neither the appraisers nor the arbitrator shall have any power to modify any of the provisions of this Lease and must base their decision on the definitions, standards, assumptions, instructions and other provisions contained in this Lease. Subject to the provisions of this Section, the Parties will cooperate to provide all appropriate information to the appraisers and the arbitrator. The appraisers (but not the arbitrator) can utilize the services of special experts, including experts to determine property condition, market rates, leasing commissions, renovation costs and similar matters. The appraisers and the arbitrator will each produce their determination in writing, supported by the reasons for the determination. (iv) Conduct of Arbitration Proceeding. Any arbitration proceeding in connection with the determination of such Land Value shall be subject to California Code of Civil Procedure Sections 1280 to 1294.2 (but excluding Section 1283.05 with respect to discovery), or successor California laws then in effect relating to arbitration generally. (v) Fees and Costs; Waiver. Each party shall bear the fees, costs and expenses of the appraiser it selects under subsection (d)(i) and of any experts and consultants used by its appraiser. The fees, costs and expenses of the arbitrator and the costs and expenses of the arbitration proceeding, if any, under subsection (d)(ii) shall be shared equally by Landlord and Tenant. Each party waives any claims against the appraiser appointed by the other party, and against the arbitrator, for negligence, malpractice or similar claims in the performance of the appraisals or arbitration contemplated by this Section. 08296.003.0027.1 6 (e) In the event that the Purchase Option is duly exercised, the parties shall promptly open an escrow at the offices of a title company mutually satisfactory to the parties (the "Title Company "). This Article XVI.2 shall constitute the Title Company's instructions. In addition, the Title Company shall prepare, and the parties hereby agree to execute, such reasonable and customary supplemental instructions and instruments, as may be reasonably required by the parties and the Title Company in order to clarify its duties hereunder and facilitate an orderly sale of the Land to Tenant. To the extent of any inconsistency between the provisions of such supplemental instructions and the provisions of this Article XVI.2, the provisions of this Article XVI.2 shall control. (f) For purposes of the Purchase Option, the "Closing Date" shall be defined as the date the grant deed deeding the Land to Tenant (or its assignee) is recorded in the Official Records of the County. The Closing Date shall occur no later than the date ninety (90) days following the final determination of the Option Price as provided in paragraph (c) above (the "Outside Closing Date "). Tenant shall have the right to extend the Outside Closing Date for up to ninety (90) days, upon Tenant's delivery of written notice to Landlord at least five (5) business days prior to the otherwise scheduled Outside Closing Date. In time sufficient to permit the closing to occur on the scheduled date therefor, Tenant shall deposit into escrow, in "immediately available funds ", the Option Price, together with all other amounts for which Tenant is responsible under this Article XVI.2. The Option Price shall be paid in full and in cash through escrow. At the Closing, Landlord shall convey good and marketable title to the Land to Tenant (or its designee) by grant deed, free and clear of all liens, encumbrances and title exceptions, excepting only (i) those exceptions contained the Preliminary Report and not disapproved by Tenant, as provided in Article V.2, (ii) the Development Agreement referenced in Article VI. 102) of this Lease, (iii) the Repurchase Option Agreement, as described in Article XV 1.2(h) below, and (iv) a deed restriction incorporating the restrictions on the use of the Land contained in Article VII I of this Lease and the restrictions on rents for the Affordable Units contained in Article VI.5(c) of this Lease. All other liens, exceptions and encumbrances shall be removed by Landlord. Tenant shall pay the cost of the policy of title insurance. Landlord and Tenant shall each pay one -half of the escrow fees and costs. There will be no proration of Expenses. If the Closing Date does not occur for any reason (other than a breach of this Lease, including this Article XVI.2, by Landlord) on or before the Outside Closing Date, Tenant's exercise of the Purchase Option shall be automatically revoked without further need of any documentation, and this Lease shall continue in full force and effect. Upon the Closing Date, this Lease shall be terminated and shall be of no further force or effect. 08296.003.0027.1 7 (g) Nothing in this Article XVL2 of this Lease shall limit the right of Landlord to sell the fee interest in the Land to a third party, subject to the rights of Tenant under this Lease, including without limitation the rights of Tenant under Article XVI.I and this Article XVI.2. (h) If Tenant has not yet commenced construction of the Phase 1 Improvements as of the Closing Date, then, at the request of Landlord, Landlord and Tenant shall enter into a "Repurchase Option Agreement" providing Landlord with the Repurchase Option, as described below, and containing other reasonable terms and conditions, including provisions implementing the Leasehold Mortgagee protection provisions contained in this Lease and allowing Leasehold Mortgagees reasonable means to protect or preserve the lien of any Leasehold Mortgage. Commencement of construction means that a grading permit has been issued and all fees associated with such permit have been paid. The Repurchase Option Agreement shall provide that, if Tenant has not commenced construction of the Phase 1 Improvements on or before December 31, 2006 (or if the Closing Date occurs after December 31, 2006, then effective any time after the Closing Date), Landlord shall have an option (the "Repurchase Option ") to repurchase the Land for the Repurchase Price (as defined below) on the terms, covenants and conditions set forth in this Article XVI.2. The Repurchase Option may be exercised by Landlord by delivery of written notice to Tenant (the "Repurchase Notice ") not earlier than January 1, 2007 and not later than December 31, 2043; provided, however, that if Tenant commences construction of the Phase 1 Improvements prior to the Repurchase Closing Date, the Repurchase Option shall immediately terminate upon the date that Tenant commences such construction. The "Repurchase Price" shall be the Option Price paid by Tenant for its purchase of the Land, increased (but not decreased) by the percentage change in the San Francisco - Oakland -San Jose Consumer Price Index (CPI) for all urban consumers from the first day of the month in which the Closing Date on Tenant's purchase of the Land pursuant to the Purchase Option to the first day of the month in which Landlord delivers a valid Repurchase Notice. For purposes of the Repurchase Option, the "Repurchase Closing Date" shall be defined as the date the grant deed deeding the Land to Landlord is recorded in the Official Records of the County. The Repurchase Closing Date shall occur no later than the date ninety (90) days following the delivery of the Repurchase Notice. In time sufficient to permit the closing to occur on the scheduled date therefor, Landlord shall deposit into escrow, in "immediately 08206.003.0027.1 8 available funds ", the Repurchase Price, together with all other amounts for which Landlord is responsible under this Article XVI.2. The Repurchase Price shall be paid in full and in cash through escrow. At the Closing, Tenant shall convey good and marketable title to the Land to Landlord (or its designee) by grant deed, free and clear of all liens, encumbrances and title exceptions, excepting only those to which the Land was subject at the time it was acquired by Tenant, and any other exceptions created by or consented to by Landlord. Landlord shall pay the cost of the policy of title insurance. Landlord and Tenant shall each pay one - half of the escrow fees and costs. There will be no proration of Expenses. If the Closing Date does not occur for any reason on or before the Outside Closing Date, Landlord's exercise of the Repurchase Option shall be automatically revoked without further need of any documentation. 4. Exhibit E. Exhibit E to the Lease, the form of the Phase 2 Lease, is amended by restating Paragraph (b) of Article VI.1(b) as set forth in Section 1 of this Amendment above, restating Article XVI.1 as set forth in Section 2 above and adding a new Article XVI.2 as set forth in Section 3 above, except that in the Phase 2 Lease such Article XVI.2 shall be modified such that (i) references to Phase 1 shall instead refer to Phase 2, (ii) separately exercisable options are granted with respect to each legally subdivided parcel which comprises the Phase 2 Land and the Minimum Price for each such parcel shall be the pro rata share attributable to such parcel, and (iii) the second paragraph of Article XVI.2(h) shall be revised as follows: The Repurchase Option Agreement shall provide that, if Tenant has not commenced construction of the Phase 2 Improvements on or before the date one (1) year after the Closing Date, Landlord shall have an option (the "Repurchase Option ") to repurchase the Land for the Repurchase Price (as defined below) on the terms, covenants and conditions set forth in this Article XVI.2. The Repurchase Option may be exercised by Landlord by delivery of written notice to Tenant (the "Repurchase Notice ") not earlier than the date one (1) year after the Closing Dafe and not later than December 31, 2043; provided, however, that if Tenant commences construction of the Phase 2 Improvements prior to the Repurchase Closing Date, the Repurchase Option shall immediately terminate upon the date that Tenant commences such construction. 5. Conflict between this Amendment and the Agreement. If there is a conflict between any of the provisions of this Amendment and any of the provisions of the Lease, the provisions of this Amendment shall control. 6. No Other Amendments or Changes. Except as expressly amended above by this Amendment, all of the terms and conditions of the Agreement shall remain unchanged and in full force and effect, and each party hereby acknowledges to the other parties that such party knows of no defaults that currently exist under the terms of the Lease as of the date hereof. 7. Recordation. The parties agree that this Amendment shall not be recorded, but if either of them shall desire to record notice in the office of the Sonoma County Recorder that this 08296.003.0027.1 9 Lease has been executed, it shall have the right to ask for and receive from the other party a duly acknowledged Memorandum of Lease, in substantially the form attached hereto as Attachment No. 2. 8. Counterparts. This Amendment may be executed in one or more counterparts, each of which shall constitute an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, this Amendment has been executed by Kisco and the Members as of the date first set forth above. "KISCO" KSL Rohnert Park, LP, a California limited partnership By: KSL Cal QyP, LLC, a California limited liability company Its: Geneylal Partner 3 Lary S. Fimo Its: Manager "THE CITY" THE CITY O RO RT P By: Name: Carl Eric Leivo Its: *-City Manager Per Resolution No. 2003 -27 adopted by the City Council at its meeting of Feb. 11, 2003 ATTEST: Deputy PROVED AS TO FORM: �+ ity At rney Betsy Strauss 08296.003.0027.1 10 ATTACHMENT NO_ 1 LEGAL DESCRIPTION OF LAND Two parcels situated in the State of California, City of Rohnert Park, County of Sonoma, and described as follows: Parcel 1 Situated in the State of California, City of Rohnert Park, County of Sonoma, and described as follows: Beginning at the Southeast corner of the 44.08 acre parcel, as show in that Record of Survey recorded in Book 115 of Maps, Pages 19 and 20, Sonoma County Records; thence from said point of beginning along the Easterly boundary of said parcel North 0° 02,20" West 395.00 feet; thence South 89° 59' 26" West 585.00 feet; thence North 0° 00' 34" West 150.00 feet; thence South 89° 59' 26" West 150.00 feet; thence South 0° 00' 34" East 150.00 feet; thence South 89° 59' 26" West 406.75 feet; thence South 0° 00' 34" East 325.88 feet to the Northerly boundary of Sonoma State Expressway, ssway „as shown on said Record of Survey; thence along said Northerly boundary South 87 02'40” East 450.87 feet; thence South 84° 33'20" East 502.80 feet; thence North 99'23'40" East 191.17 feet to the point of beginning. Excepting therefrom that portion described in the deed to the City of Rohnert Park, a municipal corporation, recorded May 13, 1982 under Recorder's Serial No..82025261 and more particularly described as follows: Beginning that the Southeast corner of Lot 6, Rohnert Park Medical Center Subdivision, as recorded in Book 285 of Maps at Pages 8, 9 and 10, Sonoma County Records; thence South 00° 02'20" East a distance of 100 feet; thence South 89° 57'40" West a distance of 50.00 feet; thence North 00° 02'20" West a distance of 100.03 feet to the Southerly boundary line of Lot 6 of the aforementioned subdivision; thence along said line North 890 59' 26" East a distance of 50.00 feet to the point of beginning. (APN 159 - 460 -17) 09296.003.0018.e ATTACHMENT "(C)- 1 LEGAL DESCRIPTION OF LAND Two parcels situated in the State of California, City of Rohnert Park, County of Sonoma, and described as follows: Parcel 2 Lying within the City of Rohnert Park, County of Sonoma and the State of California and being a portion of the lands of the City of Rohnert Park as shown in the Record of Survey recorded in Book 115 of Maps, Pages 19 and 20, Official Records of Sonoma County, more particularly described as follows: Commencing at a point 58.00 feet north of the centerline of the Rohnert Park Expressway, said point being the southeast corner of the said lands of the City of Rohnert Park, thence South 89 °23'40" West, 191.17 feet along the northerly right of way of the Rohnert Park Expressway to the TRUE POINT OF BEGINNING; thence leaving the northerly right of way of the Rohnert Park Expressway and continuing South 89 °23'40" West, 688.25 feet; thence North 87 °04'52" West, 168.22 feet; thence North 81 ° 17'02" West, 54.47 feet; thence parallel with and 77.16 feet from the centerline of the Rohnert Park Expressway, South 89 °23'40" West, 40.67 feet; thence North 00 °00'34" West, 61.83 feet to the northerly right of way of the Rohnert Park Expressway; thence South 87 °02'40" East, 450.87 feet; thence South 84 °33'20" East, 502.73 feet to the TRUE POINT OF BEGINNING. - Containing 40,981 square feet, more or less. BASIS OF BEARINGS: The bearings contained herein are based upon a Record of Survey by Herbert G. Passarino filed for record in Book 115 of Maps, Pages 19 and 20, Official Records. Description prepared by Carlile - Macy. "A' BRUCE E. BRUC 1 VIS JY JArV;v` PLS Exp Exp. 6/30/03 (, �9 No. 5143 �0oF C4� nR-)QA nn-i nn i oe Date ATTACHMENT NO. 2 FORM OF MEMORANDUM RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: Vicki Gutierrez Kisco Senior Living 5790 Fleet Street, Suite 300 Carlsbad, CA 92008 (Space Above this Line, for Recorder's Use Only) MEMORANDUM OF SECOND AMENDMENT TO AMENDED AND RESTATED GROUND LEASE This MEMORANDUM OF SECOND AMENDMENT TO AMENDED AND RESTATED GROUND LEASE (this "Memorandum ") is entered into effective as of February 11, 2003, by and between KSL Rohnert Park, LP, a California limited partnership ( "Kisco "), and the CITY OF ROHNERT PARK (the "City "). 1. Kisco and City entered into that certain Amended and Restated Ground Lease (the "Lease ") effective as of December 31, 2001. Kisco and City executed and acknowledged a Memorandum of Amended and Restated Ground Lease dated as of December 31, 2001, which was recorded in the Official Records of the County of Sonoma on December 28, 2001 as Instrument No. 2001180030. 2. Kisco and City entered into that certain First Amendment to Amended and Restated Ground Lease (the "First Amendment ") effective as of December 31, 2001. Kisco and City executed and acknowledged a Memorandum of First Amendment to Amended and Restated Ground Lease dated as of December 31, 2001, which was recorded in the Official Records of the County of Sonoma on January 14, 2003 as Instrument No. 2003008289. Pursuant to the Lease, as amended, Kisco leases the "Land" as described in Exhibit A to the Memorandum of First Amendment to Amended and Restated Ground Lease. 3. Kisco and City have entered into a Second Amendment to the Amended and Restated Ground Lease effective as of August 31, 2002 (the "Second Amendment "), pursuant to which, inter alia, City grants to Kisco an option to purchase the Land on the terms and conditions set forth therein, which option must be exercised, if at all, by December 31, 2014. 4. The parties hereto are executing and recording this Memorandum to give notice of the Second Amendment and to place all persons on notice of the rights and obligations established by the Amended and Restated Ground Lease, as amended by the First Amendment and Second Amendment, and is not intended to alter, modify, limit, abridge, enlarge or affect in any way the rights and obligations of the parties under the Amended and Restated Ground Lease, as amended by the First Amendment and Second Amendment. In the event of any conflict or inconsistency between this Memorandum and the Second Amendment, the Second Amendment shall control. All parties are directed to the undersigned with respect to the particular terms and conditions of the Amended and Restated Ground Lease, as amended by the First Amendment and the Second Amendment. 08296.003.0031.a ATTACHMENT NO.2 FORM OF MEMORANDUM 5. This Memorandum shall bind and inure to the benefit of the parties hereto and their respective heirs, successors and assigns, subject, however, to the provisions set forth in the Lease. 6. This Memorandum may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, this Memorandum has been executed by Kisco and the City as of the date first set forth above. "KISCO" KSL Rohnert Park, LP, a California limited partnership By: KSL Cal GP, LLC, a California limited liability company Its: General Partner go Lary S. Simon Its: Manager "THE CITY" THE CITY OF ROHNERT PARK By: _ Name: Its: 08296.003.0031.a 2 ATTACHMENT NO.2 FORM OF MEMORANDUM STATE OF ) ss. COUNTY OF ) On , 2003, before me, the undersigned, a notary public, personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and official seal. Notary Public Name (Typed or Printed) (Notarial Seal) STATE OF ) ss. COUNTY OF ) On , 2003, before me, the undersigned, a notary public, personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and official seal. Notary Public Name (Typed or Printed) (Notarial Seal) 08296.003.0031.a RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: Vicki Gutierrez Kisco Senior Living 5790 Fleet Street, Suite 300 Carlsbad, CA 92008 (Space Above this Line for Recorder's Use Only) MEMORANDUM OF SECOND AMENDMENT TO AMENDED AND RESTATED GROUND LEASE This MEMORANDUM OF SECOND AMENDMENT TO AMENDED AND RESTATED GROUND LEASE (this "Memorandum ") is entered into effective as of February 11, 2003, by and between KSL Rohnert Park, LP, a California limited partnership ( "Kisco "), and the CITY OF ROHNERT PARK (the "City "). 1. Kisco and City entered into that certain Amended and Restated Ground Lease (the "Lease ") effective as of December 31, 2001. Kisco and City executed and acknowledged a Memorandum of Amended and Restated Ground Lease dated as of December 31, 2001, which was recorded in the Official Records of the County of Sonoma on December 28, 2001 as Instrument No. 2001180030. 2. Kisco and City entered into that certain First Amendment to Amended and Restated Ground Lease (the "First Amendment ") effective as of December 31, 2001. Kisco and City executed and acknowledged a Memorandum of First Amendment to Amended and Restated Ground Lease dated as of December 31, 2001, which was recorded in the Official Records of the County of Sonoma on January 14, 2003 as Instrument No. 2003008289. Pursuant to the Lease, as amended, Kisco leases the "Land" as described in Exhibit A to the Memorandum of First Amendment to Amended and Restated Ground Lease. 3. Kisco and City have entered into a Second Amendment to the Amended and Restated Ground Lease effective as of August 31, 2002 (the "Second Amendment "), pursuant to which, inter alia, City grants to Kisco an option to purchase the Land on the terms and conditions set forth therein, which option must be exercised, if at all, by December 31, 2014. 4. The parties hereto are executing and recording this Memorandum to give notice of the Second Amendment and to place all persons on notice of the rights and obligations established by the Amended and Restated Ground Lease, as amended by the First Amendment and Second Amendment, and is not intended to alter, modify, limit, abridge, enlarge or affect in any way the rights and obligations of the parties under the Amended and Restated Ground Lease, as amended by the First Amendment and Second Amendment. In the event of any conflict or inconsistency between this Memorandum and the Second Amendment, the Second Amendment shall control. All parties are directed to the undersigned with respect to the particular terms and conditions of the Amended and Restated Ground Lease, as amended by the First Amendment and the Second Amendment. 08296.003.0031.a 5. This Memorandum shall bind and inure to the benefit of the parties hereto and their respective heirs, successors and assigns, subject, however, to the provisions set forth in the Lease. 6. This Memorandum may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, this Memorandum has been executed by Kisco and the City as of the date first set forth above. "KISCO" KSL Rohnert Park, LP, a California limited partnership By: KSL Cal P, LLC, a Call is limited liability company Its: General Partner By: Lary S. imon Its: M alter "THE CITY" THE CITY O ROHNERT P By: Name: Carl Eric Leivo Its: City Manager Per Resolution No. 2003 -27 adopted by the City Council at its meeting of Feb.11,2003 08296.003.0031.a 2 STATE OF ss. COUNTY OF On ��� , 2003, before me, the undersigned, a notary public, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and official seal. a lie Name (Typed or Printed) (Notarial Seal) STATE OF California ) ss. COUNTY OF Sonoma ) JACQUELINE M. AUSTIN Commission # 1343513 z Z Notary Public - Califomia i San Diego County My Comm. Expires Mar 14, 2006 On April 22 , 2003, before me, the undersigned, a notary public, personally appeared Carl Eric Leivo , personally known to me (.ems -te-n4e to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and(official seal. Notary Troy C. Dettling Name (Typed or Printed) (Notarial Seal) 08296.003.003 La