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SR-06-09-2015-8BAgenda To: Mayor and City Council Public Financing Authority From: Gigi Decavalles- Hughes, Director of Finance Subject: Amendment of Lease Between the Santa Monica Public Financing Authority and the City of Santa Monica Recommended Actions Staff recommends that the City Council: 1. Adopt the attached Resolution Approving the Substitution and Release of Property (Attachment D1), and approve the related documents required to amend the Lease between the Public Financing Authority and the City (Attachments A and B). Staff recommends that the Public Financing Authority: 1. Adopt the attached Resolution Approving the Substitution and Release of Property (Attachment D2), and approve the related documents required to amend the .Lease between the Public Financing Authority and the City (Attachments A, B and C). Executive Summary Staff is requesting the amendment of certain documents related to the issuance of the Public Financing Authority's Lease Revenue Bonds, Series 2011A and Lease Revenue Refunding Bonds, Series 2011 B to substitute Parking Structure Six for the Main Library as the leased asset securing the Series 2011A and Series 2011B Bonds as originally contemplated at the time the bonds were issued. Background In November of 2011 the Public Financing Authority (PFA) issued its Lease Revenue Bonds, Series 2011A and Lease Revenue Refunding Bonds, Series 20118 in the combined amount of $40,690,000. The Series 2011A Bonds were issued to finance construction of Parking Structure Six and the Series 2011B Bonds were issued to refinance a portion of the Series 2002 Bonds issued to finance construction of the 1 Public Safety Facility. Use of the Main Library as the leased asset to initially secure the Series 2011A and Series 2011B Bonds reduced the amount of bonds issued by the PFA and lowered the financing cost. Once Parking Structure Six was completed, the City intended to release the Main Library from the Lease Agreement and substitute Parking Structure Six so that the asset built with the bond proceeds would secure the lease payments. Also, the Main Library would then become a substantial unencumbered asset that could be used to secure future financing, (i.e. the proposed new Fire Station 1). Discussion Parking Structure Six was completed and opened for operations in December 2013. The total construction cost of Parking Structure Six was $43,309,800. The initial Lease Agreement entered into between the PFA and the City, in conjunction with issuance of the Series 2011A and Series 2011 B Bonds, authorized the release of the Main Library and substitution of Parking Structure Six as long as the final construction cost of Parking Structure Six exceeded the combined principal amount of the Series 2011A and Series 2011B Bonds of $40,690,000. In addition to the property substitution, the City will be required to obtain a title insurance policy for Parking Structure Six. Next Steps The attached resolutions and documents permit the City and PFA to proceed with all steps necessary for the amendment of the Lease. The resolutions approve the attached documents and authorize their execution and delivery by the specified officials and employees. 2 Financial Impacts & Budget Actions The substitution of Parking Structure Six for the Main Library as the leased asset securing the Series 2011A and Series 2011B will require the City to obtain a new title insurance policy for the structure. The estimated cost of the premium will be $30,000. In addition, there will be an estimated $10,000 in outside legal costs related to the substitution. These are one -time costs and will be recorded at account 01274.544390. Required budget changes will be included in the FY 2015 -17 Proposed Budget. Prepared By: David Carr, Assistant City Treasurer Approved: 1 J ,' ; u Gigi Deca a valles- Hughes Director of Finance Forwarded to Council: Elaine Polachek Interim City Manager Attachments: A: First Amendment to Ground Lease B: First Amendment to Lease Agreement C: First Amendment to Assignment Agreement D1: Resolution Approving the Substitution and Release of Property — City Council Series D2: Resolution Approving the Substitution and Release of Property— Public Financing Authority Series K Attachment A First Amendment to Ground Lease TO BE RECORDED AND WHEN RECORDED RETURN TO: Orrick, Herrington & Sutcliffe LLP 777 South Figueroa Street, 32nd Floor Los Angeles, California 90017 Attention: Laura Goo THIS TRANSACTION IS EXEMPT FROM CALIFORNIA DOCUMENTARY TRANSFER TAX PURSUANT TO SECTION 11929 OF THE CALIFORNIA REVENUE AND TAXATION CODE. THIS DOCUMENT IS EXEMPT FROM RECORDING FEES PURSUANT TO SECTION 27383 OF THE CALIFORNIA GOVERNMENT CODE. t!! by and between and SANTA MONICA k1 Dated as of 1, 2015 OHSUSA:762107685.2 IWI;�Irr_ujIpeIAMIMIX1 9M ►171NII .V`f�l THIS FIRST AMENDMENT TO GROUND LEASE (this "First Amendment to Ground Lease "), executed and entered into as of 1, 2015, is by and between the CITY OF SANTA MONICA, a municipal corporation and charter city organized and existing under the laws of the State of California (the "City "), as lessor, and the SANTA MONICA PUBLIC FINANCING AUTHORITY, a joint powers authority organized and existing under the laws of the State of California (the "Authority "), as lessee. RECITALS WHEREAS, in order to finance a portion of the costs of the acquisition, construction and installation of certain capital improvements constituting a public parking garage and related improvements, facilities and equipment (the "2002 Project "), and to refinance a portion of the costs of the acquisition, construction and installation of certain capital improvements constituting a public safety facility and related improvement, facilities and equipment (the "2011 Project "), the City leased certain real property, and the improvements thereon (the "Original Property "), to the Authority pursuant to the Ground Lease, dated as of November 1, 2011 (the "Ground Lease "), which was recorded on November 15, 2011 in the official records of Los Angeles County as Document No. 20111546205; WHEREAS, in order to refinance the 2002 Project and finance the 2011 Project, the Authority leased the Original Property to the City pursuant to the Lease Agreement, dated as of November 1, 2011 (the "Lease Agreement"), a memorandum of which was recorded on November 15, 2011 in the official records of Los Angeles County as Document No. 20111546206; WHEREAS, in order to provide funds to refinance the 2002 Project and finance the 2011 Project, the Authority issued its Santa Monica Public Financing Authority Lease Revenue Bonds, Series 2011A, and its Santa Monica Public Financing Authority Lease Revenue Refunding Bonds, Series 2011B, pursuant to the Indenture, dated as of November 1, 2011 (the "Indenture "), by and among the Authority, the City and The Bank of New York Mellon Trust Company, N.A., as Trustee (the "Trustee "); WHEREAS, in order to refinance the 2002 Project and finance the 2011 Project, the Authority assigned without recourse certain of its rights in the Ground Lease and the Lease Agreement, including its right to receive base rental payments from the City pursuant to the Ground Lease, to the Trustee pursuant to the Assignment Agreement, dated as of November 1, 2011 (the "Assignment Agreement "), which was recorded on November 15, 2011 in the official records of Los Angeles County as Document No. 20111546207 (capitalized undefined terms used herein have the meanings ascribed thereto in the Lease Agreement); WHEREAS, Section 9.03 of the Lease Agreement provides that, subject to the specific conditions precedent set forth therein, the City shall have the right to substitute alternate real property for any portion of the Original Property and to release a portion of the Original Property from the Lease Agreement; OHSUSA:762107685.2 WHEREAS, the City has determined to substitute the real property, and the improvements thereon, described on Exhibit A hereto (the "Property ") for the Original Property and to release the Original Property from the Ground Lease and the Lease Agreement; WHEREAS, the conditions precedent to such substitution of the Property and release of the Original Property set forth in Section 9.03 of the Lease Agreement have been satisfied; WHEREAS, the City and the Authority desire that the description of the real property and the improvements thereto set forth in the Ground Lease, the Lease Agreement and the Assignment Agreement be amended in order to provide for such substitution and release; WHEREAS, Section 10.07 of the Lease Agreement provides that the Lease Agreement and the Ground Lease and the rights and obligations of the Authority and the City thereunder may be amended at any time by an amendment thereto which shall become binding upon execution by the Authority and the City, without the written consents of any Owners, but only to the extent permitted by law, in order to provide for the substitution or release of a portion of the Original Property in accordance with the provisions of Section 9.03 of the Lease Agreement; WHEREAS, all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in connection with the execution and entering into of this First Amendment to Ground Lease do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the parties hereto are now duly authorized to execute and enter into this First Amendment to Ground Lease; NOW, THEREFORE, in consideration of the premises and of the mutual agreements and covenants contained herein and for other valuable consideration, the parties hereto do hereby agree as follows: PART 1 AMENDMENT Part I.I. Amendment to Exhibit A. The description of the Property set forth in Exhibit A to the Ground Lease is hereby amended to read in full as set forth in Exhibit A hereto. PART 2 MISCELLANEOUS Part 2.1. Effect of First Amendment to Ground Lease. This First Amendment to Ground Lease and all of the terms and provisions herein contained shall form part of the Ground Lease as fully and with the same effect as if all such terms and provisions had been set forth in the Ground Lease. The Ground Lease is hereby ratified and confirmed and shall continue in full force and effect in accordance with the terms and provisions thereof, as heretofore amended and supplemented, and as amended and supplemented hereby. If there shall be any conflict between the terms of this First Amendment to Ground Lease and the terms of the Ground Lease (as in effect on the day prior to the effective date of this First Amendment to Ground Lease), the terms of this First Amendment to Ground Lease shall prevail. OHSUSA:762107685.2 2 Part 2.2. Execution in Counterparts. This First Amendment to Ground Lease may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. Part 2.3. Effective Date. This First Amendment to Ground Lease shall become effective on 2015. IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to Ground Lease to be executed by their respective officers thereunto duly authorized, all as of the day and year first written above. CITY OF SANTA MONICA ATTEST: City Clerk APPROVED AS TO FORM: Marsha Jones Moutrie, City Attorney SANTA MONICA PUBLIC FINANCING AUTHORITY an ATTEST: Secretary APPROVED AS TO FORM: Marsha Jones Moutrie, Authority Counsel J 16Y I bYsW GY i U Y L r i: i� ! d EXHIBIT A DESCRIPTION OF THE PROPERTY All that real property situated in the County of Los Angeles, State of California, described as follows, and any improvements thereto: LOTS P, Q, R AND S, BLOCK 172, OF THE TOWN OF SANTA MONICA, THE CITY OF SANTA MONICA, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, BOOK 3, PAGES 80 AND 81, AND IN BOOK 39 PAGES 45 ET SEQ. OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER. APN: 4291- 016 -902 OHSUSA:762107685.2 A -I STATE OF CALIFORNIA COUNTY OF LOS ANGELES On ss 2015, before me, Notary Public, personally appeared proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is /are subscribed to the within instrument and acknowledged to me that he /she /they executed the same in his /her /their authorized capacity(ies), and that by his /her /their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature OHSUSA:762I07685.2 [SEAL] STATE OF CALIFORNIA ) ) ss COUNTY OF LOS ANGELES ) On , 2015, before me, , Notary Public, personally appeared proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is /are subscribed to the within instrument and acknowledged to me that he /she /they executed the same in his/her /their authorized capacity(ies), and that by his/her /their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature OHSUSA:762107685.2 [SEAL] CERTIFICATE OF ACCEPTANCE THIS IS TO CERTIFY that the interest in the real property conveyed by the First Amendment to Ground Lease, dated as of 1, 2015, from the City of Santa Monica, a municipal corporation and charter city organized and existing under the laws of the State of California, to the Santa Monica Public Financing Authority (the "Authority "), a joint powers authority organized and existing under the laws of the State of California , is hereby accepted by the Authority on 2015 (or by the undersigned officer or agent on behalf of the Authority pursuant to authority conferred by resolution of the Board of Directors of the Authority adopted on , 2015), and the Authority consents to the recordation thereof by its duly authorized officer. Dated: 2015 SANTA MONICA PUBLIC FINANCING AUTHORITY am OHSUSA:762107685.2 Attachment B First Amendment to Lease Agreement TO BE RECORDED AND WHEN RI RETURN TO: Orrick, Herrington & Sutcliffe LLP 777 South Figueroa Street, 32" `' Floor Los Angeles, California 90017 Attention: Greg Harrington, Esq. THIS TRANSACTION IS EXEMPT FROM CALIFORNIA DOCUMENTARY TRANSFER TAX PURSUANT TO SECTION 11929 OF THE CALIFORNIA REVENUE AND TAXATION CODE. THIS DOCUMENT IS EXEMPT FROM RECORDING FEES PURSUANT TO SECTION 27383 OF THE CALIFORNIA GOVERNMENT CODE. r. IJLVJ I , by and between and SANTA MONICA PUBLIC FINANCING AUTHORITY Dated as of 1, 2015 OHSUSA:762098476.2 FIRST AMENDMENT TO LEASE AGREEMENT THIS FIRST AMENDMENT TO LEASE AGREEMENT (this "First Amendment to Lease "), dated as of 1, 2015, is by and between the CITY OF SANTA MONICA, a municipal corporation and charter city organized and existing under the laws of the State of California (the "City "), as lessee, and the SANTA MONICA PUBLIC FINANCING AUTHORITY, a joint powers authority organized and existing under the laws of the State of California (the "Authority "), as lessor. RECITALS WHEREAS, in order to finance a portion of the costs of the acquisition, construction and installation of certain capital improvements constituting a public parking garage and related improvements, facilities and equipment (the "2002 Project "), and to refinance a portion of the costs of the acquisition, construction and installation of certain capital improvements constituting a public safety facility and related improvement, facilities and equipment (the "2011 Project"), the City leased certain real property, and the improvements thereon (the "Original Property "), to the Authority pursuant to the Ground Lease, dated as of November 1, 2011 (the "Ground Lease "), which was recorded on November 15, 2011 in the official records of Los Angeles County as Document No. 20111546205; WHEREAS, in order to refinance the 2002 Project and finance the 2011 Project, the Authority leased the Original Property to the City pursuant to the Lease Agreement, dated as of November 1, 2011 (the "Lease Agreement "), a memorandum of which was recorded on November 15, 2011 in the official records of Los Angeles County as Document No. 20111546206; WHEREAS, in order to provide funds to refinance the 2002 Project and finance the 2011 Project, the Authority issued its Santa Monica Public Financing Authority Lease Revenue Bonds, Series 2011A, and its Santa Monica Public Financing Authority Lease Revenue Refunding Bonds, Series 2011B, pursuant to the Indenture, dated as of November 1, 2011 (the "Indenture "), by and among the Authority, the City and The Bank of New York Mellon Trust Company, N.A., as Trustee (the "Trustee "); WHEREAS, in order to refinance the 2002 Project and finance the 2011 Project, the Authority assigned without recourse certain of its rights in the Ground Lease and the Lease Agreement, including its right to receive base rental payments from the City pursuant to the Ground Lease, to the Trustee pursuant to the Assignment Agreement, dated as of November 1, 2011 (the "Assignment Agreement "), which was recorded on November 15, 2011 in the official records of Los Angeles County as Document No. 20111546207 (capitalized undefined terms used herein have the meanings ascribed thereto in the Lease Agreement); WHEREAS, Section 9.03 of the Lease Agreement provides that, subject to the specific conditions precedent set forth therein, the City shall have the right to substitute alternate real property for any portion of the Original Property and to release a portion of the Original Property from the Lease Agreement; OHSUSA:762098476.2 WHEREAS, the City has determined to substitute the real property, and the improvements thereon, described on Exhibit A hereto (the "Property ") for the Original Property and to release the Original Property from the Lease Agreement; WHEREAS, the conditions precedent to such substitution of the Property and release of the Original Property set forth in Section 9.03 of the Lease Agreement have been satisfied; WHEREAS, the City and the Authority desire that the description of the real property and the improvements thereto set forth in the Ground Lease, the Lease Agreement and the Assignment Agreement be amended in order to provide for such substitution and release; WHEREAS, Section 10.07 of the Lease Agreement provides that the Lease Agreement and the Ground Lease and the rights and obligations of the Authority and the City thereunder may be amended at any time by an amendment thereto which shall become binding upon execution by the Authority and the City, without the written consents of any Owners, but only to the extent permitted by law, in order to provide for the substitution or release of a portion of the Original Property in accordance with the provisions of Section 9.03 of the Lease Agreement; WHEREAS, all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in connection with the execution and entering into of this First Amendment to Lease do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the parties hereto are now duly authorized to execute and enter into this First Amendment to Lease; NOW, THEREFORE, in consideration of the mutual covenants hereinafter contained, the parties hereto agree as follows: PART 1 AMENDMENT Part 1.1. Amendment to Exhibit A. The description of the Property set forth in Exhibit A to the Lease Agreement is hereby amended to read in full as set forth in Exhibit A hereto. PART MISCELLANEOUS Part 2.1. Effect of First Amendment to Lease. This First Amendment to Lease and all of the terms and provisions herein contained shall form part of the Lease Agreement as fully and with the same effect as if all such terms and provisions had been set forth in the Lease Agreement. The Lease Agreement is hereby ratified and confirmed and shall continue in full force and effect in accordance with the terms and provisions thereof, as heretofore amended and supplemented, and as amended and supplemented hereby. If there shall be any conflict between the terms of this First Amendment to Lease and the terms of the Lease Agreement (as in effect on the day prior to the effective date of this First Amendment to Lease), the terms of this First Amendment to Lease shall prevail. OHSUSA:762098476.2 2 Part 2.2. Execution in Counterparts. This First Amendment to Lease may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. Part 2.3. Effective Date. This First Amendment to Lease shall become effective on 12015. OHSUSA:762098476.2 IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to Lease to be executed by their respective officers thereunto duly authorized, all as of the day and year first written above. ATTEST: Sarah P. Gorman, City Clerk APPROVED AS TO FORM: Marsha Jones Moutrie, City Attorney SANTA MONICA PUBLIC FINANCING AUTHORITY ATTEST: Sarah P. Gorman, Secretary APPROVED AS TO FORM: Marsha Jones Moutrie, Authority Counsel OHSUSA:762098476.2 4 EXHIBIT A DESCRIPTION OF THE PROPERTY All that real property situated in the County of Los Angeles, State of California, described as follows, and any improvements thereto: LOTS P, Q, R AND S, BLOCK 172, OF THE TOWN OF SANTA MONICA, THE CITY OF SANTA MONICA, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, BOOK 3, PAGES 80 AND 81, AND IN BOOK 39 PAGES 45 ET SEQ. OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER. APN: 4291- 016 -902 OHSUSA:762098476.2 A -1 STATE OF CALIFORNIA ) ) ss COUNTY OF LOS ANGELES ) On 2015, before me, , Notary Public, personally appeared proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is /are subscribed to the within instrument and acknowledged to me that he /she /they executed the same in his /her /their authorized capacity(ies), and that by his /her /their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature ORSUSA:762098476.2 [SEAL] STATE OF CALIFORNIA ) ) ss COUNTY OF LOS ANGELES ) On 2015, before me, , Notary Public, personally appeared proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is /are subscribed to the within instrument and acknowledged to me that he /she /they executed the same in his /her /their authorized capacity(ies), and that by his /her /their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature OHSUSA:7620984762 [SEAL] CERTIFICATE OF ACCEPTANCE THIS IS TO CERTIFY that the interest in the real property conveyed by the First Amendment to Lease Agreement, dated as of 1, 2015, from the Santa Monica Public Financing Authority, a joint powers authority organized and existing under the laws of the State of California, to the City of Santa Monica (the "City "), a municipal corporation and charter city organized and existing under the laws of the State of California, is hereby accepted by the City on 2015 (or by the undersigned officer or agent on behalf of the City pursuant to authority conferred by resolution of the City Council of the City adopted on , 2015), and the City consents to the recordation thereof by its duly authorized officer. Dated: 2015 WWWO],1F.Y1► WW CIJ&W, C OHSUSA:762098476.2 Attachment C First Amendment to Assignment Agreement TO BE RECORDED AND WHEN R] RETURN TO: Orrick, Herrington & Sutcliffe LLP 777 South Figueroa Street, 32 "d Floor Los Angeles, California 90017 Attention: Greg Harrington, Esq. THIS TRANSACTION IS EXEMPT FROM CALIFORNIA DOCUMENTARY TRANSFER TAX PURSUANT TO SECTION 11929 OF THE CALIFORNIA REVENUE AND TAXATION CODE. THIS DOCUMENT IS EXEMPT FROM RECORDING FEES PURSUANT TO SECTION 27383 OF THE CALIFORNIA GOVERNMENT CODE. by and between MONICA SANTA ' 1' and AS TRUSTEE Dated as of 1, 2015 OHSUSA:762107749.2 FIRST AMENDMENT TO ASSIGNMENT AGREEMENT THIS FIRST AMENDMENT TO ASSIGNMENT AGREEMENT (this "First Amendment to Assignment'), dated as of 1, 2015, is by and between the SANTA MONICA PUBLIC FINANCING AUTHORITY, a joint powers authority organized and existing under the laws of the State of California (the "Authority "), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association organized and existing under the laws of the United States of America, as Trustee (the "Trustee "). RECITALS WHEREAS, in order to finance a portion of the costs of the acquisition, construction and installation of certain capital improvements constituting a public parking garage and related improvements, facilities and equipment (the "2002 Project'), and to refinance a portion of the costs of the acquisition, construction and installation of certain capital improvements constituting a public safety facility and related improvement, facilities and equipment (the "2011 Project'), the City leased certain real property, and the improvements thereon (the "Original Property "), to the Authority pursuant to the Ground Lease, dated as of November 1, 2011 (the "Ground Lease "), which was recorded on November 15, 2011 in the official records of Los Angeles County as Document No. 20111546205; WHEREAS, in order to refinance the 2002 Project and finance the 2011 Project, the Authority leased the Original Property to the City pursuant to the Lease Agreement, dated as of November 1, 2011 (the "Lease Agreement'), a memorandum of which was recorded on November 15, 2011 in the official records of Los Angeles County as Document No. 20111546206; WHEREAS, in order to provide funds to refinance the 2002 Project and finance the 2011 Project, the Authority issued its Santa Monica Public Financing Authority Lease Revenue Bonds, Series 2011A, and its Santa Monica Public Financing Authority Lease Revenue Refunding Bonds, Series 2011B, pursuant to the Indenture, dated as of November 1, 2011 (the "Indenture "), by and among the Authority, the City and the Trustee; WHEREAS, in order to refinance the 2002 Project and finance the 2011 Project, the Authority assigned without recourse certain of its rights in the Ground Lease and the Lease Agreement, including its right to receive base rental payments from the City pursuant to the Ground Lease, to the Trustee pursuant to the Assignment Agreement, dated as of November 1, 2011 (the "Assignment Agreement'), which was recorded on November 15, 2011 in the official records of Los Angeles County as Document No. 20111546207 (capitalized undefined terms used herein have the meanings ascribed thereto in the Lease Agreement); WHEREAS, Section 9.03 of the Lease Agreement provides that, subject to the specific conditions precedent set forth therein, the City shall have the right to substitute alternate real property for any portion of the Original Property and to release a portion of the Original Property from the Lease Agreement; OHSUSA:762107749.2 WHEREAS, the City has determined to substitute the real property, and the improvements thereon, described on Exhibit A hereto (the "Property ") for the Original Property and to release the Original Property from the Lease Agreement; WHEREAS, the conditions precedent to such substitution of the Property and release of the Original Property set forth in Section 9.03 of the Lease Agreement have been satisfied; WHEREAS, the City and the Authority desire that the description of the real property and the improvements thereto set forth in the Ground Lease, the Lease Agreement and the Assignment Agreement be amended in order to provide for such substitution and release; and WHEREAS, all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in connection with the execution and entering into of this First Amendment to Assignment do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the parties hereto are now duly authorized to execute and enter into this First Amendment to Assignment; NOW, THEREFORE, in consideration of the mutual covenants hereinafter contained, the parties hereto agree as follows: PART 1 AMENDMENT Part I.I. Amendment to Exhibit A. The description of the Property set forth in Exhibit A to the Assignment Agreement is hereby amended to read in full as set forth in Exhibit A hereto. PART 2 MISCELLANEOUS Part 2.1. Effect of First Amendment to Assignment. This First Amendment to Assignment and all of the terms and provisions herein contained shall form part of the Assignment Agreement as fully and with the same effect as if all such terms and provisions had been set forth in the Assignment Agreement. The Assignment Agreement is hereby ratified and confirmed and shall continue in full force and effect in accordance with the terms and provisions thereof, as heretofore amended and supplemented, and as amended and supplemented hereby. If there shall be any conflict between the terms of this First Amendment to Assignment and the terms of the Assignment Agreement (as in effect on the day prior to the effective date of this First Amendment to Assignment), the terms of this First Amendment to Assignment shall prevail. Part 2.2. Execution in Counterparts. This First Amendment to Assignment may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. OHSUSA:762107749.2 2 Part 2.3. Effective Date. This First Amendment to Assignment shall become effective on 2015. IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to Assignment to be executed by their respective officers thereunto duly authorized, all as of the day and year first written above. SANTA MONICA PUBLIC FINANCING AUTHORITY an ATTEST: Sarah P. Gorman, Secretary APPROVED AS TO FORM: Marsha Jones Moutrie, Authority Counsel THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., AS TRUSTEE OHSUSA:762107749.2 EXHIBIT A DESCRIPTION OF THE PROPERTY All that real property situated in the County of Los Angeles, State of California, described as follows, and any improvements thereto: LOTS P, Q, R AND S, BLOCK 172, OF THE TOWN OF SANTA MONICA, THE CITY OF SANTA MONICA, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, BOOK 3, PAGES 80 AND 81, AND IN BOOK 39 PAGES 45 ET SEQ. OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER. APN: 4291- 016 -902 OHSUSA:762107749.2 A -1 STATE OF CALIFORNIA ) ) ss COUNTY OF LOS ANGELES ) On 2015, before me, I Notary Public, personally appeared proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is /are subscribed to the within instrument and acknowledged to me that he /she /they executed the same in his/her /their authorized capacity(ies), and that by his /her /their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature OHSUSA:762107749.2 [SEAL] STATE OF CALIFORNIA ) ) ss COUNTY OF LOS ANGELES ) On 2015, before me, , Notary Public, personally appeared , proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is /are subscribed to the within instrument and aelmowledged to me that he /she /they executed the same in his /her /their authorized capacity(ies), and that by his /her /their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature OHSUSA:762107749.2 [SEAL] RESOLUTION NO. (CCS) (CITY COUNCIL SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA APPROVING THE SUBSTITUTION AND RELEASE OF PROPERTY LEASED IN CONNECTION WITH THE SANTA MONICA PUBLIC FINANCING AUTHORITY LEASE REVENUE BONDS, SERIES 2011A, AND SANTA MONICA PUBLIC FINANCING AUTHORITY LEASE REVENUE REFUNDING BONDS, SERIES 2011B, AUTHORIZING THE EXECUTION AND DELIVERY BY THE CITY OF A FIRST AMENDMENT TO GROUND LEASE AND A FIRST AMENDMENT TO LEASE AGREEMENT IN CONNECTION THEREWITH AND AUTHORIZING THE EXECUTION OF NECESSARY DOCUMENTS AND CERTIFICATES AND RELATED ACTIONS WHEREAS, in order to finance a portion of the costs of the acquisition, construction and installation of certain capital improvements constituting a public parking garage and related improvements, facilities and equipment (the "2002 Project'), and to refinance a portion of the costs of the acquisition, construction and installation of certain capital improvements constituting a public safety facility and related improvement, facilities and equipment (the "2011 Project "), the City of Santa Monica (the "City ") leased certain real property, and the improvements thereon (the "Original Property "), to the Santa Monica Public Financing Authority (the "Authority ") pursuant to the Ground Lease, dated as of November 1, 2011 (the "Ground Lease "); WHEREAS, in order to refinance the 2002 Project and finance the 2011 Project, the Authority leased the Original Property to the City pursuant to the Lease Agreement, dated as of November 1, 2011 (the "Lease Agreement'); WHEREAS, in order to provide funds to refinance the 2002 Project and finance the 2011 Project, the Authority issued its Santa Monica Public Financing Authority Lease Revenue Bonds, Series 2011A, and its Santa Monica Public Financing Authority Lease Revenue Refunding Bonds, Series 2011B, pursuant to the Indenture, dated as of November 1, 2011 (the "Indenture "), by and among the Authority, the City and The Bank of New York Mellon Trust Company, N.A., as Trustee (the "Trustee "); WHEREAS, in order to refinance the 2002 Project and finance the 2011 Project, the Authority assigned without recourse certain of its rights in the Ground Lease and the Lease Agreement, including its right to receive base rental payments from the City pursuant to the Ground Lease, to the Trustee pursuant to the Assignment Agreement, dated as of November 1, 2011 (the "Assignment Agreement') (capitalized undefined terms used herein have the meanings ascribed thereto in the Lease Agreement); WHEREAS, Section 9.03 of the Lease Agreement provides that, subject to the specific conditions precedent set forth therein, the City shall have the right to substitute alternate real property for any portion of the Original Property and to release a portion of the Original Property from the Lease Agreement; OHSUSA:762105487.2 WHEREAS, the City has determined to substitute certain real property, and the improvements thereon, as further described herein (the "Property "), for the Original Property and to release the Original Property from the Ground Lease and the Lease Agreement; WHEREAS, the City and the Authority desire that the description of the real property and the improvements thereto set forth in the Ground Lease, the Lease Agreement and the Assignment Agreement be amended in order to provide for such substitution and release; WHEREAS, Section 10.07 of the Lease Agreement provides that the Lease Agreement and the Ground Lease and the rights and obligations of the Authority and the City thereunder may be amended at any time by an amendment thereto which shall become binding upon execution by the Authority and the City, without the written consents of any Owners, but only to the extent permitted by law, in order to provide for the substitution or release of a portion of the Original Property in accordance with the provisions of Section 9.03 of the Lease Agreement; WHEREAS, in order to provide for such substitution and release, there has been prepared a First Amendment to Ground Lease (such First Amendment to Ground Lease, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the "First Amendment to Ground Lease "); WHEREAS, the Property, which is to be substituted for the Original Property, is described in Exhibit A to the First Amendment to Ground Lease; WHEREAS, in order to provide for such substitution and release, there has been prepared a First Amendment to Lease Agreement (such First Amendment to Lease Agreement, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the "First Amendment to Lease Agreement'); WHEREAS, the Property, which is to be substituted for the Original Property, is described in Exhibit A to the First Amendment to Lease Agreement; WHEREAS, there have been prepared and submitted to this meeting forms of: (a) the First Amendment to Ground Lease; and (b) the First Amendment to Lease Agreement; WHEREAS, the City desires to authorize the execution of such documents and the performance of such acts as may be necessary or desirable to effect the substitution and release of the property, and improvements thereon, leased pursuant to the Ground Lease and the Lease Agreement; and WHEREAS, all acts, conditions and things required by the Constitution, laws of the State of California and the City Charter of the City to exist, to have happened and to have been performed precedent to and in connection with the consummation of the transactions authorized hereby do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the City is now duly authorized and empowered, pursuant to OHSUSA:762105487.2 2 each and every requirement of law, to consummate such transactions for the purpose, in the manner and upon the terms herein provided; NOW, THEREFORE, BE IT RESOLVER by the City Council of the City of Santa Monica, as follows: Section 1. The foregoing recitals are true and correct, and the City Council of the City (the "City Council ") so finds and determines. Section 2. The substitution of the Property, as the property leased pursuant to the Ground Lease and the Lease Agreement, for the Original Property, as the property leased pursuant to the Ground Lease and the Lease Agreement, and the release of the Original Property from the Ground Lease and the Lease Agreement is hereby approved. Section 3. The form of the First Amendment to Ground Lease, on file with the City Clerk of the City (the "City Clerk "), is hereby approved. Each of the Mayor of the City, or such other member of the City Council as the Mayor may designate, the City Manager of the City, the Director of Finance /Treasurer of the City and the Assistant Treasurer of the City (each, an "Authorized Officer ") is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the City, to execute and deliver the First Amendment to Ground Lease in the form submitted to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the First Amendment to Ground Lease by such Authorized Officer. Section 4. The form of the First Amendment to Lease Agreement, on file with the City Clerk, is hereby approved. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the City, to execute and deliver the First Amendment to Lease Agreement in the form submitted to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the First Amendment to Lease Agreement by such Authorized Officer. Section 5. The Authorized Officers and the officers and employees of the City are, and each of them is, hereby authorized and directed, for and in the name of the City to do any and all things and to execute and deliver any and all documents, including quitclaim deeds, which they or any of them deem necessary or advisable in order to consummate the transactions contemplated by this Resolution and otherwise to carry out, give effect to and comply with the terms and intent of this Resolution. Section 6. All actions heretofore taken by the officers and employees of the City with respect to the substitution of the Property for the Original Property and the release of the Original Property from the Ground Lease and the Lease Agreement, or in connection with or related to any of the agreements or documents referred to herein, are hereby approved, confirmed and ratified. OHSUSA:762105487.2 3 Section 7. The City Clerk shall certify to the adoption of this Resolution and thenceforth and thereafter the same shall be in full force and effect. APPROVED AS TO FORM: Marsha Jones Moutrie, City Attorney Adopted and approved this 9th day of June, 2015. Mayor OHSUSA:762105487.2 I hereby certify that the foregoing Resolution No. (CCS) was duly adopted by the City Council of the City of Santa Monica at a meeting thereof held on June 9, 2015 by the following Council vote: Ayes: Councilmembers: Noes: Councilmembers: Abstain: Councilmembers: Absent: Councilmembers: ATTEST: OHSUSA:762105487.2 City Clerk Attachment D1 Resolution Approving the Substitution and Release of Property ® City Council Series Attachment D2 Resolution Approving the Substitution and Release of Property— Public Financing Authority Series Reference: Lease No. 10079 (CCS) E19 Resolution No. 10882 (CCS) 0 11 (PEAS)