HomeMy WebLinkAboutOrdinance 2810 N.C.S. 04/04/2022
Introduced by Mike Healy Seconded by Kevin McDonnell ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PETALUMA APPROVING AN AMENDED AND RESTATED LEASE AGREEMENT WITH ROOSTER RUN GOLF CLUB, LLC
WHEREAS, in 1991, the City entered into a lease with Empire Golf, Inc. (“Lease”), to construct and operate what is now the Rooster Run Golf Course near the Petaluma Municipal Airport (Lease); and
WHEREAS, the Lease was amended in 1994 (“First Amendment”) to accept assignment
to a-new entity, Cottonwood Golf Club, Inc., revise the terms for construction, require the contribution of an additional 33 acres to the site by Cottonwood and, by terms which later became a matter of dispute between the City and Lessee, to modify a provision in the original Lease by which the City would subordinate its interest in the golf course land as security for course
financing; and
WHEREAS, in 1996, the lease was again amended to add additional land formerly leased to Redwood Empire-Sports Associates, extend construction dates and set parameters for resident greens fees; and
WHEREAS, in 1997, the City, Lessee and Exchange Bank entered into a comprehensive Lender's Agreement and Third Amendment to Lease (“Third Amendment”) under which the City, Lessee and the Bank agreed to detailed conditions to enable Lessee to receive a construction loan for the course; and
WHEREAS, in the Third Amendment, Lessee also granted to the City easements imposing use limitations for aviation rights of way necessary to protect the City Airport approach and landing areas, and no subordination of the City's land was required by the Third Amendment; and
WHEREAS, Rooster Run Golf Course, LLC is the City’s current golf course lessee; and
WHEREAS, on December 9th, 2011, the City Council adopted the Fourth Amendment to the Lease (“Fourth Amendment”) to respond to the economic hardships facing golf courses during the recession; and
EFFECTIVE DATE
OF ORDINANCE
May 4, 2022
ORDINANCE NO. 2810 N.C.S.
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WHEREAS, in the Fourth Amendment, the parties agreed to an estimated 20% reduction in total rent, or approximately $830,000 over the remaining life of the Lease (which was 26.6 years
at that time) and provided significant relief to the operators for the next ten years; and
WHEREAS, the Fourth Amendment also eliminated specified Lease provisions and added terms to the Lease expressly providing that under no circumstances would the City be obligated to subordinate its fee ownership or any other City interest in the golf course to any current or future
debt of the lessee and successors or assigns of the lessee; and
WHEREAS, on January 4th, 2021, the City Council approved the Fifth Amendment to the Lease (“Fifth Amendment”), which reduced the base rental rate to 2.5% of gross revenues for a period of time extending through June 30, 2022, due to financial hardship experienced by the
Rooster Run Golf Course due to the multi-month course closures required by COVID-19 health
orders and the ongoing economic impacts; and WHEREAS, additionally, the City Council directed that the Fifth Amendment prohibit the use of glyphosate (i.e. “Round-up” and similar) weed control products on the golf course; and
WHEREAS, the Lease and the First, Second, Third, Fourth, and Fifth Amendments to the Lease are together referred to in this ordinance as the Prior Lease Agreements; and WHEREAS, the Fifth Amendment includes a provision pursuant to which the City and
Rooster Run LLC agree to meet and confer in good faith on a routine basis to negotiate a revised
rental structure for the Lease taking into account all relevant factors with the goal of entering into a new lease with a new rent structure prior to December 1, 2021; and WHEREAS, the relevant factors include the burden on Rooster Run Golf Club, LLC of
required capital improvements to the golf course and the buildings, providing the lessee a
reasonable return on such capital expenditures and the amenities and benefits that golf courses and maintained open space provide for the community, which amenities and benefits may be lost to the community if the lessee is unable to meet its debt service obligation and/or operate the golf course at a reasonable profit; and
WHEREAS, City staff and Mr. Coombs, the manager of Roster Run Golf Club, LLC have been meeting for several months to negotiate mutually agreeable deal points for an Amended and Restated Lease, including regarding such provisions as those governing rent, course maintenance, capital improvements, a lease term sufficient to allow refinance of debt, and recreational programs
and City events; and
WHEREAS, Section 46 of Article VII of the Petaluma City Charter provides in pertinent part that no City action providing for the sale or lease of real property having a value of $3,000 or more may be taken except by ordinance or pursuant to a general law of the State; and WHEREAS, adoption this ordinance to approve an amended and restated lease with
Rooster Run Golf Club, LLC for the operation of an existing golf course is not a “project” under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15378
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as a governmental organizational and administrative activity, and the terms of the proposed Amended and Restated Lease, attached hereto and made a part hereof as Exhibit A, will not result
in direct or indirect physical changes in the environment; and
WHEREAS, even if adopting this ordinance to approve an Amended and Restated Lease
with Rooster Run Golf Club, LLC for the operation of an existing golf course were determined to constitute a “project” under CEQA, this action is categorically exempt under CEQA in accordance with Sections 15301 (Existing Facilities) and 15304 (Minor Alterations to Land) of the CEQA Guidelines, as the golf course facilities and operations addressed in the Amended and Restated
Lease are existing facilities and operations, located on an already improved property;
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF PETALUMA AS FOLLOWS:
Section 1. Recital Finding. The City Council hereby finds and determines the foregoing recitals to be true and correct and hereby incorporates them into this ordinance as findings and determinations of the City Council.
Section 2. CEQA Finding. Adoption of this ordinance to approve an Amended
and Restated lease with Rooster Run Golf Club, LLC for the operation of an existing golf course is not a “project” under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15378 as a governmental organizational and administrative activity, and the terms of the proposed Amended and Restated Lease, attached hereto and made a part hereof as
Exhibit A, will not result in direct or indirect physical changes in the environment. If adopting this
ordinance to approve an Amended and Restated Lease with Rooster Run Golf Club, LLC for the operation of an existing golf course were determined to constitute a “project” under CEQA, this action is categorically exempt under CEQA in accordance with Sections 15301 (Existing Facilities) and 15304 (Minor Alterations to Land) of the CEQA Guidelines, as the golf course
facilities and operations addressed in the Amended and Restated Lease are existing facilities and
operations, located on an already improved property. Section 3. Approval of Lease. In accordance with Section 46 of Article VII of the Petaluma City Charter and other applicable law, the Amended and Restated Lease between the
City of Petaluma and Rooster Run Golf Club, LLC that is attached to and made a part of this
ordinance as Exhibit A is hereby approved, and the City Manager is hereby authorized to execute on behalf of the City a lease agreement with Rooster Run Golf Club, LLC that is substantially in accordance with that attached as Exhibit A and is approved as such by the City Attorney. The City Manager’s authorization pursuant to this ordinance includes the authority to have prepared and to
execute any supplementary agreements and other documents, including, but not limited, an
Agreement for Purchase and Use of Recycled Water as needed to complete the Amended and Restated Lease, and to have prepared and execute and record a Memorandum of Lease concerning the Amended and Restated Lease.
Section 4. Repeal of Prior Lease Agreements. All prior actions of the City Council
concerning the Prior Lease Agreements are hereby repealed and shall cease to be of any effect at the time the Amended and Restated Lease takes effect.
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Section 5. Severability. If any section, subsection, sentence, clause, phrase or word
of this ordinance is for any reason held to be unconstitutional, unlawful or otherwise invalid by a
court of competent jurisdiction or preempted by state legislation, such decision or legislation shall not affect the validity of the remaining portions of this ordinance. The City Council of the City of Petaluma hereby declares that it would have passed and adopted this ordinance and each and all provisions thereof irrespective of the fact that any one or more of said provisions be declared
unconstitutional, unlawful, or otherwise invalid.
Section 6. Effective Date. This ordinance shall become effective thirty (30) days after the date of its adoption by the Petaluma City Council.
Section 7. Posting/Publishing of Notice. The City Clerk is hereby directed to publish
or post this ordinance or a synopsis for the period and in the manner provided by the City Charter and other applicable law.
INTRODUCED, and ordered posted/published, this 21st day of March, 2022.
Ayes: Barnacle, Healy, King, McDonnell, Pocekay
Noes: Barrett, Fischer
Abstain: None
Absent: None
ADOPTED this 4th day of April, 2022, by the following vote:
Ayes: Barnacle, Healy, King, McDonnell, Pocekay
Noes: Barrett, Fischer
Abstain: None
Absent: None
Teresa Barrett, Mayor
ATTEST: APPROVED AS TO FORM:
Karen Gonzales, Interim City Clerk Eric Danly, City Attorney
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AMENDED AND RESTATED
LEASE AGREEMENT
This First Amended and Restated Lease Agreement (“Restated Lease”) is entered into as of July
1, 2022, by and between the CITY OF PETALUMA, a California municipal corporation and charter city (“City”), and ROOSTER RUN GOLF CLUB, LLC, California limited liability company number 199811710118 (“Lessee”).
RECITALS:
This Restated Lease is made with reference to the following facts:
A. City and a certain third party not party hereto, namely Empire Golf Inc., a California corporation (“Empire”), entered into that certain Lease Agreement dated as of January 7, 1991 (the “Original Lease”), concerning approximately 126 acres (the “Original Leased Premises”)
located at 2301 E Washington Street_ Petaluma, California, 94954_, Assessor’s Parcels No.
136070029, which is near the Petaluma Municipal Airport property in Sonoma County, California, as more particularly described in the Original Lease.
B. Empire assigned its interest in the Original Lease to Cottonwood Golf Club, Inc., a California corporation (“Cottonwood”). Cottonwood and City approved such assignment. City
and Cottonwood amended the terms of the Original Lease pursuant to the terms of that certain
Amendment to Lease Agreement dated as of December 8, 1994 (the “First Amendment”).
C. City and Cottonwood agreed to amend the Original Lease pursuant to the terms of that certain Second Amendment to Lease Agreement dated June 5, 1996 (the “Second Amendment”) pursuant to which the Original Leased Premises were redemised to cover the real
property described in Exhibits “A”, “B” and “C” to the Second Amendment and reserved an
easement for the City described in Exhibit “D” to the Second Amendment. Exhibits A, B, C, and D from the Second Amendment are all attached to this Restated Lease as Exhibits A, B, C and D_ and incorporated herein by this reference and describe the Leased Premises in accordance with Section 1 of this Restated Lease.
D. Cottonwood assigned its interest in the Original Lease to Lessee and City approved
such assignment. City, Lessee and Exchange Bank (herein so called) again amended the Original Lease pursuant to that certain Lender’s Agreement and Third Amendment to Lease Agreement dated as of December 19, 1997 (the “Third Amendment”).
E. City, Lessee and Exchange Bank again amended the Original Lease pursuant to that
certain Fourth Amendment to Lease Agreement dated November 1, 2011 (the “Fourth Amendment”).
F. City and Lessee again amended the Original Lease pursuant to that certain Fifth Amendment to Lease Agreement dated as of June 16, 2021 (the “Fifth Amendment”).
G. The Original Lease, the First Amendment, the Second Amendment, the Third
Amendment, the Fourth Amendment and the Fifth Amendment shall be referred to herein
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collectively as the “Prior Lease Agreements.” The documents comprising the Prior Lease Agreements are attached to this Restated Lease for informational and reference purposes as Exhibit
E .
H. City and Lessee wish to amend the Prior Lease Agreements and to restate and replace the Prior Lease Agreements in their entirety by and in accordance with this Restated Lease.
ACCORDINGLY, for good and valuable consideration, the receipt and sufficiency is hereby acknowledged, City and Lessee hereby agree to amend, restate and replace in their entirety
the Prior Lease Agreements by and in accordance with this Restated Lease, as follows.
1. GRANT OF LEASE AND LEASED PREMISES
City leases to Lessee and Lessee leases from City, for the term and upon the terms and conditions set forth in this Restated Lease approximately 126 acres located at 2301 E Washington Street, Petaluma, California, 94954, Assessor’s Parcel Number 136070029 which parcel of real
property is located near the Petaluma Municipal Airport property in Sonoma County, California,
as more particularly described in Exhibit A, B, and C, and are subject to the easement in favor of City described in section 9.5 included in Exhibit D, along with all easements, covenants. and other appurtenant rights expressly granted concerning such real property (collectively the “Leased Premises”) in accordance with the terms of this Restated Lease. The Leased Premises contain
structures, parking lots, tee areas, greens, fairways, sand traps, roughs, a driving range and other
golf course features and related facilities and infrastructure necessary for the operation of a public municipal golf course. The golf course features and related improvements on the Leased Premises are referred to in this Restated Lease as the “Golf Course” and the improvements on the Leased Premises are referred to as the “Golf Course Improvements.”
2. USE OF LEASED PREMISES
Lessee agrees it will use the Leased Premises for the operation of a public, municipal golf course and other activities customarily associated with or incidental to the operation of a public, municipal golf course, including without limitation, sale or rental of golf-related merchandise at a golf professional’s shop, furnishing of lessons by a golf professional, operation of a driving range,
and sales of food and beverages, including liquor sales, and for municipal events and recreational
and other programs as further described in this Restated Lease. Together these golf course activities are referred to in this Restated Lease as the “Golf Course Operations.” The municipal events and recreational and other programs which will be held on the Leased Premises and that comprise part of the Golf Course Operations are further described in Section 13 of this Restated
Lease.
Lessee shall not use the Leased Premises for any unlawful purpose or for any purpose not authorized pursuant to this Restated Lease and shall comply with all valid laws, rules and regulations applicable to the Leased Premises and the activities conducted on the Leased Premises in accordance with this Restated Lease and other applicable laws and regulations.
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3. QUIET ENJOYMENT
Subject to and in accordance with the terms of this Restated Lease, and to Lessee’s
compliance with its obligations under this Restated Lease, City shall secure to Lessee the quiet enjoyment of the Leased Premises and the sole and exclusive possession of the Leased Premises except as otherwise expressly provided in this Restated Lease.
4. TERM
4.1 Term. The Restated Lease term (“Term") shall be twenty (20) years, commencing
July 1, 2022, (“Commencement Date”) and expiring on June 30, 2042 (“Expiration Date”). For purposes of this Restated Lease the Term shall include the Option once the Option is properly exercised.
4.2 Option. Lessee is granted and may exercise an option to extend the Term
(“Option”) by up to an additional sixteen (16) years from July 1, 2042 to June 30, 2058 (the
“Option Term”) in accordance with the terms and conditions of this Restated Lease including, but not limited to, the Option Term Annual Rent provision, Section 10.2. Lessee shall give written notice of Lessee’s exercise of the Option in accordance with Section 27 no later than July 1, 2041.
5. LEASE YEAR DEFINED
A “Lease Year” is that period of 12 consecutive calendar months beginning July 1 of each
year and ending on June 30 of the next calendar year. The Lease Year may be changed by written agreement of the parties in accordance with section 27. Each Lease Year will constitute a separate accounting period for the purpose of computing percentage rent, and gross revenue. If this Restated Lease is terminated prior to the end of a Lease Year, the rent due the City will be subject to
proration to correspond with the portion of the Lease Year prior to termination.
6. CITY AND LESSEE COMPLETED OBLIGATIONS UNDER THE ORIGINAL LEASE
6.1 City’s Completed Pre-construction Obligations
Lessee agrees and acknowledges that the City’s obligations prior to construction of the Golf Course under the Prior Lease Documents have been fully satisfied, completed and
accepted by Lessee, including without limitation any and all obligations to: provide design,
easements, and permits for a treated waste water line to the Leased Premises; share equally the cost of fencing on the Leased Premises north of East Washington Street to secure the Golf Course from playing fields and other activities at Prince Park; all necessary archeological, fish and game, biological soils analysis or other required studies or approvals necessary to commence construction
of the Golf Course; all necessary environmental permits for the Golf Course construction, such as
an environmental impact report or negative declaration; providing for all necessary map recordation, and the granting of any conditional use permits, easements and zoning approvals; and providing at the point of ultimate connection, all necessary and required utilities, to the extent available, including without limitation, electricity, water, sewer, and fire hydrants.
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6.2 Lessee’s Completed Construction Obligations
City agrees and acknowledges that Lessee’s obligation to construct the Golf Course
under the Prior Lease Documents has been, prior to the Effective Date, fully satisfied, completed
and accepted by Lessee, including without limitation, any and all obligations to construct the 18-hole Golf Course, driving range, clubhouse, landscaping and irrigation improvement, night lighting, maintenance building, mechanical, electrical and plumbing installations, parking, cart storage, extension of water mains and any and all other Golf Course Improvements.
7. IRRIGATION WATER
7.1 Recycled Water
City and Lessee acknowledge that the Golf Course is and is intended to continue to be irrigated with recycled wastewater produced by the City (“Recycled Water”) in accordance with all applicable laws, regulations and rules including any applicable use permits or other
approvals granted by the City. The Lessee acknowledges and agrees that the regulations that apply
to the City’s delivery and the Lessee’s use of Recycled Water to irrigate the Golf Course include the requirements of the City’s National Pollution Discharge Elimination System permit (“NPDES Permit”) and any successor permits governing discharge of Recycled Water into the Petaluma River and General Water Reuse Order No. 96-011 or any successor permits issued by the
California Regional Water Quality Control Board, San Francisco Bay Region, or other regulatory
body establishing requirements for reuse of Recycled Water. City’s delivery and Lessee’s use of Recycled Water to irrigate the Golf Course shall be subject to the terms of an Agreement for the Purchase and Use of Recycled Water (“Recycled Water Agreement.”) The Recycled Water Agreement between the City and the Lessee shall be attached to and made a part of this Restated
Lease as Exhibit F. The term of the Recycled Water Agreement shall be the Term of this Restated
Lease and the Recycled Water Agreement shall be assignable on the same basis as this Restated Lease in accordance with Section 21 of this Restated Lease. For purposes of the Recycled Water Agreement, the priority date of Lessee’s commencement of use of Recycled Water shall be January 1, 1989.
7.2 Well Water
So long as Lessee satisfies Lessee’s minimum recycled water usage requirements in the Recycled Water Agreement, Lessee may use the wells on the Leased Premises to supplement the recycled water supplied by the City when the recycled water supplied by the City is reduced or curtailed pursuant to the Recycled Water Agreement. Any and all costs of operating the wells on
the Leased Premises, including, but not limited to, the cost of any ground water fees or charges
that may be imposed by the Petaluma Valley Groundwater Sustainability Agency, shall be borne solely by the Lessee.
8. OWNERSHIP OF IMPROVEMENTS
All buildings, improvements and facilities, other than personal property placed
upon the Leased Premises by Lessee, shall become City’s property upon the expiration or
termination of the Term of this Restated Lease.
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9. GRANT OF AVIGATION RIGHTS TO CITY.
Pursuant to the Third Amendment, Lessee granted and does hereby reconfirm and regrant to City,
its successors and assigns, for the term of this Restated Lease an assignable easement over the
Leased Premises, lying beneath the Airspace, as described in this Paragraph 9 for the Petaluma Municipal Airport.
9.1 Description of Airspace. The “Airspace” described in this Section 9 shall consist of the following.
9.2 Approach Zones (Inner and Outer Approaches). The imaginary plane above the
Leased Premises as such plane is defined by Part 77 of the Federal Aviation Regulations consisting of a trapezoidal plane inclined at the rate of one foot vertically for each twenty feet horizontally (20:1), the elevation of which plane is based upon the Petaluma Municipal Airport official runway end elevation for Runway 11 of 87 feet Above Mean Sea Level (AMSL), as determined by the
Official Airport Layout Plan on file with the City. The approach zone is defined as a trapezoidal
plan centered on the extended runway centerline at a point located 200 feet beyond the official runway end and encompasses the runway protection zone (formerly known as the clear zones), the inner and outer approach zones. The approximate dimensions of the approach zones are depicted on Exhibit “G” attached hereto and incorporated by reference herein (the “Airport Map”).
9.3 Transition Area. The imaginary plane above the Leased Premises as such plane is
defined by Part 77 of the Federal Aviation Regulation's consisting of a plane beginning at 250' setback from the runway centerline and inclined at the rate of one foot vertically for each seven feet horizontally (7:1), the elevation of the said plane is based upon the Petaluma Municipal Airport official runway end elevation of 87 feet Above Mean Sea Level (AMSL), as determined by the
approximate dimensions of which said plane are described and shown on the Airport Map.
9.4 Horizontal Zone. The imaginary plane above portions of the Leased Premises as such plane is defined by Part 77 of the Federal Aviation Regulations consisting of a horizontal plane situated 150 feet above the Petaluma Municipal Airport's elevation (87') more clearly defined as 237' Above Mean Sea Level, as shown on the Airport Map.
9.5 City’s Easement Rights. City’s easement and right-of-way under this Section 9.5
include but are not limited to the following uses:
A. For the uses and benefit of the public, the easement and continuing right to fly, or cause or permit the flight by any and all persons, or any and all kinds now or hereafter known, in, through, across or about any portion of the Airspace;
B. The easement and right to cause or caused or create or permit to allow to be
caused or created within all space above the existing surface of the Leased Premises and any and all Airspace laterally adjacent to the Leased Premises, such noise, fumes, emission, vibration, currents and other effects of air, illumination and fuel consumption as may be inherent in, or may arise or occur from or during the operation of aircraft of any and all kinds, now or hereafter known
or used, for navigation of or flight in air;
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C. A continuing right to clear, and keep clear the Airspace of any portions of buildings, structures, or improvements of any kinds, and of trees or other objects, including the
right to remove, or demolish those portions of such buildings, structures, improvements, trees or
other things which extend into or above said Airspace, and the right to cut to the ground level and remove, any trees which extend into or above the Airspace, and the right to remove, prevent or restrict sources of excessive smoke, glare or electronic interference that may become a hazard to air navigation.
D. The right to mark and light, or cause or require to be marked or lighted, as
obstructions to air navigation, any and all buildings, structures, or other improvements, and trees or other objects, which extend into or above the Airspace;
E. The right to ingress to, passage within and egress from the Leased Premises upon notice to Lessee, for the purposes described in Section 9.5 (C) and (D), above; and
F. The right to prevent, restrict or limit the type, density and/or intensity of use
of that portion of the airspace located within the inner approach zone(s) as depicted on The Airport Map to meet the Airport Compatibility Criteria defined by the City of Petaluma and the Sonoma County Airport Land Use Commission.
9.6 Lessee Easement Obligations. Lessee hereby covenants with the City, for the direct
benefit of the real property constituting the Petaluma Municipal Airport, that Lessee will not
construct, install, erect, place or go in or upon the Leased Premises, nor will Lessee permit to allow, any building structure, improvement, tree or other object which extends into or above the Airspace, or which constitutes an obstruction to air navigation or which obstructs or interferes with the use of the easement and rights-of-way herein granted by this Section 9.5. In the event any tree
on the Leased Premises extends into or above the airspace or adversely impacts flight patterns, the
tree height shall be reduced by Lessee promptly upon notice from the City to eliminate the extension into or above the airspace or adverse flight pattern and the cost thereof shall constitute a Renovation and Modernization improvement.
The easements and rights-of-way herein granted shall be deemed both appurtenant to and for the
direct benefit of that real property which constitutes the Petaluma Municipal Airport, in the County
of Sonoma, State of California; and shall further be deemed in gross, being conveyed to City for the benefit of the City for the term of the Restated Lease and any and all members of the general public who may use said easement of right-of-way, in landing at, taking off from or operating such aircraft in or about the said Petaluma Municipal Airport, or in otherwise flying through the
Airspace.
The grant of easement and right-of-way to City under this Section 9.5 shall not operate to deprive Lessee, its successor or assigns, of any rights which it may from time to time have against any private operator for negligent or unlawful operation of aircraft.
10. RENT
In consideration of City executing this Restated Lease and grant of the rights provided in
this Restated Lease, Lessee will pay to City, at the address listed in Section 27, below, the consideration specified in this section.
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10.1 Term Annual Rent
The annual rent beginning July 1, 2022, throughout the Term shall be two percent (2%) of Gross
Revenue (as defined in Section 11, below).
Beginning July 1, 2032, until June 30, 2042, Lessee shall pay to Lessor the greater of the following:
A. Percentage of Gross Revenue. Lessee agrees to pay Lessor three percent (3%) of the Gross Revenue, or
B. Percentage of Net Income Cash Flow. Lessee agrees to pay Lessor twelve
and one-half percent (12.5%) of the Net Income Cash Flow. Net Income Cash Flow for purposes
of this section is defined as net income, as described in the GAAP standard accounting principles, minus all debt service payments for principal and interest and minus all Renovation and Modernization Improvement expenditures, as defined in Section 13 below.
10.2 Option Term Annual Rent
The annual rent during the Option Term shall be the greater of the following:
A. Four and one-half percent (4.5%) of the Gross Revenue, or
B. Fifteen percent (15%) of the Net Income Cash flow.Net Income Cash Flow for purposes of this section is defined as net income, as described in the GAAP standard accounting principles, minus all debt service payments for principal and interest and minus all Renovation and
Modernization Improvement expenditures, as defined in Section 13, below.
10.3 Monthly Statement. On or before the 15th of each calendar month. Lessee shall deliver to the City a written statement certified as correct by Lessee, of the amount of Lessee’s Gross Revenue during the preceding calendar month.
10.4 Records. Lessee shall, with respect to business done on the Leased Premises, keep
true and accurate accounts, records, books and dates (hereinafter called “records”), in a form
satisfactory to the City. The City may, at the City’s expense, require an audit of each annual statement. Accurate receipt printing registers shall be installed and kept by Lessee on the premises, which shall show and record each and every sale transaction. Rentals and fees shall be recorded when made or performed.
10.5 Inspection of Records; Audit. The City shall be entitled at any time throughout the
Term and Option Term and for one (1) year thereafter to question the accuracy of any statement furnished by Lessee hereunder. For such purpose Lessee shall keep safe and intact for at least four (4) years after the end of each Lease Year all of Lessee’s records, sales slips, and other material Lessee is required to maintain hereunder with respect to Gross Revenue. Lessee shall upon written
request, make the same available for examination at any reasonable time for four (4) year after the
end of Lease Year to which such records relate. Lessee hereby agrees that the City, its employees, agents and representatives, at all reasonable times, shall have the right to inspect and examine all such records, sales slips and other material by which the City may be enabled to ascertain the amount of Lessee’s Gross receipts hereunder. Lessee agrees to furnish the City true and complete
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copies of its annual retail sales and use tax returns at the time such is filed with the State of California relative to its operations at the Golf Course. Upon written request by the City, Lessee
agrees to immediately furnish the City with a copy of such records and materials for the reasonable
cost of producing same.
11. GROSS REVENUE
For purposes of this Restated Lease the term, “Gross Revenue” shall mean only money received by Lessee from green fees, cart rentals, and driving range fees and shall exclude money
received from any other Golf Course Operations. Gross Revenue shall also exclude:
11.1 Cash refunds or credits allowed on returns by customers;
11.2 Sales taxes, excise taxes, gross receipts taxes and other similar taxes now or later imposed upon the sale of food, beverages, merchandise or services and paid by Lessee to the appropriate taxing authority, whether added to or included in the selling price;
11.3 The actual uncollectible amount of any check or bank draft including costs of
collection received by Lessee as payment for goods or services and returned to Lessee from a customer’s bank as being uncollectible (commonly “non-sufficient funds” checks), but only after Lessee has made reasonable efforts to collect on the check;
11.4 The actual uncollectible amount of any charge or credit account (commonly “bad
debts”) incurred including costs of collection by Lessee for the sale of merchandise or services;
provided, however, that the credit was extended to the customer by Lessee, and that reasonable efforts to collect said account have been made;
11.5 The actual uncollectible amount of any sale of merchandise or services for which Lessee accepted a credit card; including costs of collection provided, however, that Lessee has
made reasonable efforts to collect the debt after being notified by the issuing bank of the invalidity
or collectability of the charge;
11.6 Interest or other charges paid by customers for extension of credit;
11.7 Sales or trade-ins of machinery, vehicles, trade fixtures or personal property used in connection with Lessee’s operation of the Leased Premises;
11.8 The value of any merchandise, supplies or equipment exchanged or transferred
from or to other locations of business of Lessee where such exchange or transfer is not made for the purpose of avoiding a sale which would otherwise be made from or at the Leased Premises;
11.9 Receipts in the form of refunds from or the value of merchandise, supplies or equipment returned to shippers, suppliers or manufacturers;
11.10 The amount of any cash or quantity discounts received from sellers, suppliers or
manufacturers;
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11.11 The amount of any gratuities paid or given by customers to or for employees of Lessee;
11.12 Receipts from the sales of uniforms or clothing required to be worn by employees;
11.13 Amounts attributed to meals served or provided to employees of Lessee;
11.14 Receipts from the sale of waste or scrap materials resulting from Lessee’s operations; and/or
11.15 Credit card fees and charges.
12. FEES AND CHARGES
Lessee shall establish and keep current a comprehensive schedule of fees for golf play and cart rentals.
12.1 Establishing of Fees. Fees for golf shall be determined in the following manner annually. The regular 18 hole weekday and regular 18 hole weekend green fees at the following
five (5) area courses shall be surveyed annually each July 1 and the average of the greens fees
calculated.
A. Peacock Gap Golf Course
B. Windsor Golf Course
C. Foxtail Golf Club North Golf Course
D. Indian Valley Golf Course
E. The Links at Bodega Harbour
The greens fees that the Lessee may charge shall be no greater than the average of the greens fees charged by the above five comparator courses. A comprehensive review of the applicability of the above five comparator courses shall be conducted every five (5) years. Based on the review, the
City and Lessee by mutual agreement may remove and/or add comparator courses for purposes of
this Restated Lease.
12.2 Residents Discount. Fees for golf for non-residents of the City of Petaluma shall be determined solely by Lessee in accordance with this Section 12. All City residents shall be entitled to a twenty percent (20%) discount applied to the fees actually charged by Lessee to non-
residents of the City of Petaluma. All Seniors and Juniors who are City residents shall be entitled
to a thirty percent (30%) discount applied to the fees actually charged by Lessee to non-residents. Days and hours of availability of resident discounts shall be determined by Lessee, and shall not be unreasonably restricted. At a minimum, resident discounts shall be reflected in daily course rates on a pro-rated schedule to include discounts on play Monday - Thursday, Fridays, and
Weekends/Holidays. In addition to daily rates, resident discounts shall be reflected in the Course
Membership rates and assessed annually in accordance with the rate schedule. All other fees,
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including without limitation, fees for range balls, lessons, rentals, food and beverages, and golf shop merchandise shall be at sole discretion of Lessee. A register receipt, showing date and time
of issue, and amount paid, shall be tendered to every person paying for Golf Course fees or
services.
13. SERVICES TO BE PROVIDED BY LESSEE
Pursuant to this Restated Lease, Lessee shall provide the services and operate the Golf Course facilities as described below.
13.1 Management. Lessee agrees to operate and manage the Golf Course facilities and
services offered in a high quality manner comparable to other courses providing similar facilities and services during the entire term of this Restated Lease. Lessee shall provide, at a minimum, a full time Head Golf Professional who shall be a “Class A” member of the Professional Golfers Association of America, and a full time Golf Course Superintendent who is a “Class A” member
of the Golf Course Superintendents Association of America. Lessee agrees it shall operate and
maintain a standard of service at least equal to that of the comparator golf course facilities aforementioned in Section 12.1(A).
13.2 Hours of Operation. Lessee will establish hours of operation, subject to City’s approval, which approval shall not be unreasonably withheld. Lessee agrees it will conduct
business on the Leased Premises in conformance with published hours and days of operation as
established, unless an exception or change is otherwise approved by City.
13.3 Lessee’s Employees. Lessee will ensure that its employees shall at all times conduct themselves in a credible manner. Lessee shall maintain a staff adequate to operate and administer all facilities located on the Leased Premises.
13.4 Dress and Conduct Standards. Lessee shall set dress and conduct standards, subject
to City’s approval, which approval shall not be unreasonably withheld, and shall be permitted to deny entry or permission to play to anyone who fails to conform to those standards. Lessee shall have the right to, in its sole judgement, refuse admission and/or service to persons who are drunk, disorderly, under the influence of drugs, or who conduct themselves in a manner that could result
in injury or harm to persons or property on the Leased Premises. Lessee shall also have the right
to suspend privileges as it deems necessary.
13.5 Public Course: Non-Discrimination. Fair and equal use of the Leased Premises and facilities and hiring, treatment and advancement of employees there at by Lessee shall not in any manner be denied or abridged on the basis of sex, race, color, religion, ancestry, national origin,
or in any other manner discriminatory under federal, state or local law.
13.6 Clubs, Tournaments and Special Events.
A. Clubs. Lessee agrees to encourage formation of recognized golfers’ organizations by users of the Golf Course. The parties hereto agree that gender specific clubs, for example men’s and women’s clubs, seniors clubs, or junior clubs, can be important to the success
of a golf course; and Lessee shall have the right, in Lessee’s reasonable business judgement, to
establish such clubs or other similar clubs may be granted certain privileges, including, but not
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limited to, starting time preferences and annual use playing cards, with a first preference given to Petaluma residents. City shall have the right two times during each Lease Year to schedule a
tournament or tournaments for the full day. Lessee and City will agree in advance, once a year,
on the dates for such tournaments. Tournament participants will pay the then-prevailing rates for golf tournament fees and services
B. Tournaments and Special Events. Lessee agrees to accommodate and encourage tournaments and to consider favorably suggestions for events calculated to
accommodate the public, increase golf play at the Golf Course, and otherwise mutually benefit the
parties hereto. The scheduling of and rules for all tournaments shall be determined by Lessee. City and Lessee acknowledge that tournaments and special events limit the public access to the course during such events.
13.7 Municipal Events and Recreational and Other Programs.
A. Municipal Events. Lessee and City will agree annually each July on the
dates for when up to four (4) municipal events sponsored by the City shall occur in the Events Center on the Leased Premises that Lease Year. There shall be no charge to the City for the use of the Leased Premises for the four annual municipal events. The Lessee’s then-in effect fees shall apply to Lessee services that are utilized during the municipal events.
B. Recreational and Other Programs. Lessee and City will agree annually each
July on City-sponsored programs administered by the City’s Parks and Recreation Department that shall occur on the Leased Premises that Lease Year. There shall be no charge to the City for the use of the Leased Premises for City-sponsored recreational and other programs. The Lessee’s then-in effect fees shall apply to Lessee services that are utilized during the City-sponsored
recreational and other programs. City-sponsored programs shall be compatible and not interfere
with Golf Course Operations.
13.8 City’s Right of Inspection. City, acting through its Director of Parks and Recreation (“Director”), shall have the right to enter upon and inspect the Leased Premises at any time during normal business hours.
13.9 City Park Maintenance Standards Apply. In maintaining the Golf Course and the
Leased Premises Lessee will comply with environmental management best practices such as those provided through the Audubon Cooperative Sanctuary Program for golf (ACSP) or a comparable standard. The Lessee agrees to comply with the City’s Integrated Pest Management Plan (“IPMP”) upon its adoption. However, if the Lessee’s compliance with the IPMP as adopted causes the
Lessee significant hardship, the Parties agree to negotiate in good faith regarding alternative
compliance of the Lessee. Use of glyphosate on the Leased Premises is prohibited.
14. TAXES, POSSESSORY INTEREST TAX NOTICE
Lessee will pay all taxes, license fees or other governmental charges assessed or imposed on the personal property and improvements located on the Leased Premises or upon the Golf
Course Operations of Lessee conducted on the Leased Premises. In accordance with California
Revenue Taxation Code Section 107.6, Lessee understands and acknowledges that execution of this Restated Lease may create a possessory interest in Lessee subject to property taxation. Lessee
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hereby agrees that if such a possessory interest is created and is subject to property taxation, Lessee shall be solely responsible for payment of such property taxes levied on any such interest.
15. UTILITIES
Lessee will pay before delinquency all charges for utilities, including electricity, gas, heating, cooling, telephone and water, used by Lessee on the Leased Premises.
16. RENOVATION AND MODERNIZATION IMPROVEMENTS
16.1 Renovation and Modernization Trust Fund. Starting July 1, 2028, Lessee will begin
funding a major renovation and modernization program by creation of a Renovation and
Modernization Trust Fund (“Trust Fund”). Lessee will fund the Trust Fund by paying an additional three percent (3%) of Golf Course Gross Revenues annually commencing July 1, 2028. The Trust Fund payments are in addition to the annual rent specified in Section 10 of this Restated Lease. Trust Fund payments will be due at the same time rent payments are due. Trust Funds will
be deposited into an account approved by City. All interest earned by the Trust Fund will be
credited to the Trust Fund. Th City and Lessee will be co-signatories on the Trust Fund account and withdrawals from the Trust Fund will require the signatures of both City and Lessee. Lessee will make improvements to the Golf Course in accordance with this Section and the future improvement plan described in Section 16.3, below. All Golf Course improvements, including,
but not limited to, the initial improvements specified below, will be subject to City approval as to
design and other details, and City inspection and acceptance on completion.
16.2 Initial Improvements. Notwithstanding the Trust Fund requirements specified in Section 16.1, above, Lessee will complete the following initial Golf Course improvements no later than July 1, 2023. City agrees that the cost of the initial improvements shall be reimbursed from
the Trust Fund.
A. Roof replacement of the Event Center, Pro Shop, and Cart Barn with 40-year asphalt shingles.
B. Solar panel installation on the Event Center, Pro Shop, Cart Barn, and a portion of the Parking Lot sufficient to offset the electricity use of the entire Leased Premises,
including the charging of electric carts and irrigation pumping. The solar panel installation shall
be subject to City’s prior review and approval, which approval shall not be unreasonably withheld.
C. Dry rot repair and repainting of the Event Center, Pro Shop, and Cart Barn.
D. Resurfacing and restriping of the parking lot.
16.3 Future Improvements. Following completion of the Initial Improvements, the Trust
Fund moneys will be expended for Golf Course improvements in accordance with a schedule of
planned future Golf Course improvements (“Future Improvements Plan”). The Future Improvements Plan shall be attached to and made a part of this Restated Lease as Exhibit H by amendment to this Restated Lease in accordance with Section 33. The Future Improvements Plan may be amended from time to time in accordance with Section 33, below.
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16.4 Option Term Trust Fund Payments. Beginning on July 1, 2042, the Lessee’s Trust Fund payments, as described in Section 16.1, above, shall increase from three percent (3%) to four
percent (4%) of Gross Revenue.
17. MAINTENANCE AND REPAIRS
Lessee shall be solely responsible for maintenance and repair of the Leased Premises and Lessee will maintain the Leased Premises in good order and in sanitary and safe condition at Lessee’s sole expense throughout the Term. Lessee agrees it will maintain the Leased Premises in
accordance with the maintenance standards specified in Exhibit “I”, which is attached to and made
a part of this Restated Lease, and the Lessee Easement Obligations in Section 9.6. Lessee shall also maintain the restored portions of the natural channels within the Leased Premises in accordance with a Management Plan to be prepared by Lessee in accordance with Condition 17 of Conditional Use Permit (“CUP”) number 96201 approved by Administrative Site Plan and
Architectural Review. Lessee shall also maintain all paths installed by Lessee on the Leased
Premises in accordance with Condition 46 of CUP 96201.
18. CITY’S COOPERATION
In the event that Lessee requires additional City permits or authorizations or other approvals in order to perform and satisfy Lessee’s obligations under this Restated Lease.,, City
agrees that, without waiving any discretionary City approvals and expressly reserving any and all
regulatory requirements that apply to Lessee’s performance and satisfaction of Lessee’s obligations under this Restated Lease, City will receive from Lessee and review and process in accordance with applicable laws and regulations all Lessee applications for permits or licenses or other approvals that are subject to the jurisdiction and authority of the City and that are required
for Lessee to perform and satisfy Lessee’s obligations under this Restated Lease.
19. INSURANCE
The following amounts and types of insurance coverage relating to the Leased Premises and Lessee’s Golf Course Operations on the Leased Premises shall be maintained at all times throughout the Term of this Restated Lease.
19.1 Liability Insurance
Lessee will maintain, at Lessee’s sole expense, a policy or policies of commercial general liability insurance, naming City and Lessee as insureds, with coverage of not less than two million dollars ($2,000,000.00) combined single limit for bodily injury and property damage. The liability limit of $2,000.000 per occurrence shall be reviewed every five years, City shall reevaluate
said liability limits and such limits shall be adjusted as determined by the City. Such adjustments
shall be reasonable in comparison with comparable golf courses and golf course operations such as those of the comparator courses listed in Section 12.1.
19.2 Worker’s Compensation. Lessee will maintain, at Lessee’s sole expense, a policy or policies of worker’s compensation insurance in accordance with applicable California law.
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19.3 Fire Insurance. Lessee shall maintain, at Lessee’s sole expense, a standard form policy or policies of fire and special form insurance covering the Leased Premises, and all the Golf
Course Improvements, including, without limitation, the clubhouse and all other buildings,
structures and fixtures on the Leased Premises and all personal property, furnishings and equipment used in Lessee’s Golf Course Operations, in an amount equal to the replacement cost. Such fire policy or policies shall name both the City and Lessee as loss payees.
19.4 Proof of Insurance. Lessee agrees to provide City evidence of the insurance
coverage required pursuant to this Restated Lease consisting of copies of the policy or policies
then in effect, a certificate of coverage, copies of additional insured, primary coverage, and subrogation waiver endorsements and proof of payment of premiums. Any insurance required pursuant to this Restated Lease may be satisfied by a blanket or other policy or policies of insurance that satisfies the requirements of this Restated Lease, provided that the City is able to
verify to the City’s reasonable satisfaction that such blanket or other policy is adequate for
purposes of this Restated Lease taking into consideration other property and operations to which the blanket or other policy may also apply. The Lessee’s required insurance policies shall be endorsed to name the City, and its officials, officers, employees and agents as additional insureds, and to provide that the Lessee’s insurance shall operate as primary insurance such that no other
insurance obtained by City will be required to contribute to any insured loss, and to waive any
rights of subrogation as against the City or its officials, officers, employees and agents.
20. INDEMNITY
20.1 Lessee’s General Obligation to Indemnify and Defend. Lessee shall indemnify, defend and hold the City and its officials, officers, employees and agents harmless from and against
any and all claims, demands, causes of action, and liability, including, without limitation, liability
resulting from injury to persons or damage to property sustained on or about the Leased Premises or arising from Lessee’s Golf Course Operations or as a proximate result of the acts or omissions of Lessee or its employees or agents, and including attorneys’ fees and costs of litigation and regulatory and administrative proceedings. The Lessee’s obligations to indemnify, defend and
hold harmless pursuant to this section shall not apply liability that results from the direct and
proximate negligence or willful misconduct of City or City’s employees or agents acting within the scope of their employment or agency.
20.2 Lessee’s Environmental Indemnity. Lessee shall indemnify, defend and hold the City and its officials, officers, employees and agents harmless from and against any and all claims,
demands, causes of action, and liability, including, without limitation, liability resulting from
injury to persons or damage to property or the environment sustained on or about or emanating from the Leased Premises or arising from Lessee’s Golf Course Operations or as a proximate result of the acts or omissions of Lessee or its employees or agents, and including attorneys’ fees and costs of litigation and regulatory and administrative proceedings arising from or relating to release
of toxic or hazardous materials or other pollution or contamination commencing with the effective
date of the Original Lease and continuing throughout the Term.
20.3 City’s Environmental Indemnity. City shall indemnify, defend and hold the Lessee and its officials, officers, employees and agents harmless from and against any and all claims, demands, causes of action, and liability, including, without limitation, liability resulting from
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injury to persons or damage to property or the environment sustained on or about or emanating from the Leased Premises or arising from City’s operations or as a proximate result of the acts or
omissions of City or its employees or agents, and including attorneys’ fees and costs of litigation
and regulatory and administrative proceedings arising from or relating to release of toxic or hazardous materials or other pollution or contamination commencing with the City’s acquisition of the Leased Premises and continuing until the commencement of the Original Lease.
21. DAMAGE AND RESTORATION
21.1 Damage or Destruction. If the buildings structures or other Golf Course
Improvements or fixtures on the Leased Premises, or the personal property utilized by the Lessee for the performance of Golf Course Operations under this Restated Lease, should be partially damaged or totally destroyed by fire or other casualty, Lessee will repair, reconstruct or replace the Golf Course Improvements, fixtures or personal property damaged or destroyed to a condition
as nearly similar as possible to that before being damaged or destroyed. If repair, reconstruction
or replacement is prohibited under then-existing laws, or if the City and Lessee should decide among themselves that reconstruction or replacement is not warranted. this Restated Lease shall terminate without further obligation on the part of either party.
21.2 Rental Reduction and Term Extension. If Lessee is unable to use all or a significant
portion of the Leased Premises during repair. reconstruction or replacement in accordance with
this Section 21, Lessee’s obligation to pay rent under Section 10 shall be reduced or adjusted by a percentage amount equal to the percentage loss of Gross Revenue as defined in Section 11 and attributable to such interruption as appropriate until such time as Lessee is again able to use the Leased Premises for its intended purpose. Provided that the Lessee proceeds to diligently
commence and complete the repair, reconstruction or replacement of the Golf Course
Improvements, fixtures or personal property damaged or destroyed to a condition as nearly similar as possible to that before being damaged or destroyed, then Term shall also be extended for a period equivalent to the length of time needed for Lessee to restore the Leased Premises and make them available for Lessee’s use pursuant to Section 2 of this Restated Lease.
22. EMINENT DOMAIN
In the event that title to any portion of the Leased Premises is taken by condemnation or by right of eminent domain, this Restated Lease shall not be terminated (except as otherwise provided in this section), but all rent and other payments due the City •during the remaining Term shall be reduced by a percentage amount equal to the percentage of reduced Gross Revenue as
defined in Section 11 attributable to such taking. Notwithstanding the foregoing, in the event that
title or possession of the Leased Premises are taken by condemnation or eminent domain to the extent Lessee cannot reasonably conduct Golf Course Operations on the untaken portion of the Leased Premises, this Restated Lease shall terminate as of the earlier of the date title or possession to the taken portion is obtained by the condemning authority. If there is a taking by right of eminent
domain, the award shall belong to and be paid to City, except that Lessee shall receive from the
award the following: (a) a sum attributable to the then-remaining value of Lessee’s leasehold estate, taking into account all of Lessee’s obligations under this agreement, including but not limited to, Lessee’s obligations to pay rent and to submit Trust Fund payments and (b), a sum attributable to loss of good will.
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23. FRUSTRATION OF PURPOSE
At any time during the term of this Restated Lease, if the governing body of any political
subdivision having competent jurisdiction over the Leased Premises should enact any valid zoning
ordinance, law or regulation which prohibits the use of the whole or a substantial part of the Leased Premises for the purposes as provided in Section 2 of this Restated Lease, or if an event of force majeure occurs, including without limitation, declared or undeclared war, sabotage, riot or other acts of civil disobedience, acts of government, labor disputes, shortages of fuel, accidents, fires,
explosions, floods, earthquakes, or other acts of God, which substantially prevents Lessee’s
fulfillment of its obligations pursuant to this Restated Lease, it is agreed that Lessee may elect, within one hundred twenty (120) days after the effective date of such ordinance, law, regulation or the occurrence of the event of force majeure, to cancel this Restated Lease and surrender possession of the Leased Premises. Any such cancellation and surrender will act to release and
discharge Lessee from any further obligations under this Restated Lease, except for Lessee’s
Surviving Obligations pursuant to Section 34, below.
24. ASSIGNMENT
Except as otherwise provided below. Lessee shall not assign this Restated Lease without the prior written consent of the City, which such consent shall not be unreasonably withheld.
Lessee shall notify City of any proposed assignment at least sixty (60) days prior to the proposed
effective date of such assignment. In the event that any such assignment is approved by City, the assignee shall agree in writing to be bound by all of the terms and conditions of and to faithfully perform all of Lessee’s obligations under this Restated Lease. Following the full execution of all documents effecting assignment of the Restated Lease, City shall thereafter release Lessee from
liability under this Restated Lease, except for liability which may have arisen during the term of
Lessee’s operation of the Leased Premises, and except for Lessee’s Surviving Obligations pursuant to Section 34, below.
24.1 City Right of First Refusal Acquire Leasehold. If prior to expiration date of the Term, Lessee should propose to assign all of its interest in this Restated Lease pursuant to the
provision of Section 24 above, Lessee shall submit the proposed terms and conditions of any such
assignment, in writing, to City. and City shall then have sixty (60) days from the date of such submission or such longer period as the Lessee may grant in writing within which to exercise a right of first refusal to acquire Lessee’s rights under the Restated Lease on terms and conditions no more favorable than those offered by the proposed assignee. If the City exercises its right of
first refusal to acquire Lessee’s rights under the Restated Lease, then following the full execution
of all documents effecting City’s acquisition of Lessee’s rights under the Restated Lease, Lessee shall be released from any and all further liability under this Restated Lease other than for liability which may have arisen during the term of Lessee’s operation of the Leased Premises, and except for Lessee’s Surviving Obligations pursuant to Section 34, below.
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25. BREACH AND REMEDIES
25.1 Conditions of Default. The following will constitute a breach and a default under
this Restated Lease.
A. Lessee’s failure to pay rent, Trust Fund payments or fulfill any other monetary obligation of Lessee to City, and Lessee’s failure to cure such monetary default within thirty (30) days following written notice from City to Lessee of such monetary default.
B. The failure of either Lessee or City to perform any of its respective non-
monetary obligations under this Restated Lease when due, and the failure of the party in default to
cure such non-monetary default within sixty (60) days following written notice from the non-defaulting party of such non-monetary default; provided, however, that if the non-monetary default results from a force majeure occurrence or is otherwise such that the non-monetary default cannot be fully cured within sixty (60) days, the party in default shall have such additional time as is
reasonably necessary to cure the default so long as the party in default is proceeding diligently to
complete the necessary cure.
C. If Lessee is adjudged bankrupt, or a receiver is appointed for Lessee’s property, or if Lessee’s interest in this Restated Lease shall pass by operation of law to any person other than Lessee and such adjudication, appointment or order is not vacated, dismissed, or set
aside within one hundred twenty (120) days from its entry.
25.2 Remedies
A. If any of the conditions of default listed in -section 25.1, above, should occur, the non-defaulting party may elect to terminate this Restated Lease upon notice to the defaulting party in accordance with Section 27, below, and seek any and all available remedies as
provided under law and in equity.
B. If either party at any time by reason of the other party’s’ default and through no fault of the non-defaulting party is required to pay any sum or do any act that requires payment of any sum, the sum paid by the non-defaulting party shall be immediately due and owing by the defaulting party to the non-defaulting party at the time the sum is paid, and if paid at a later date
shall bear interest at the rate of ten percent (10%) per annum from the date the sum is paid by the
non-defaulting party, until the non-defaulting party is reimbursed by the defaulting party.
26. LEASEHOLD MORTGAGEE PROTECTIONS
The terms of this Section 26 shall apply and remain in effect at all times that the interest of Lessee and in this Restated Lease is hypothecated or otherwise encumbered to (i) Exchange Bank
as security for an indebtedness or leasehold mortgage of Lessee to Exchange Bank or (ii) to any
other leasehold mortgagee.
26.1 Assignment of Leasehold
A. Lessee, as security for any indebtedness to Exchange Bank, or as specified in this Section 26, may encumber by a Deed of Trust or other proper instrument (“Instrument”)
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the leasehold interest of Lessee under this Amended Lease, together with Lessee’s right to the use and occupancy of all improvements now and hereafter placed upon the Leased Premises. Any
such encumbrances shall, however, require the prior written consent of City, which consent will
not be unreasonably withheld. The execution of said Instrument, or the foreclosure thereof or sale thereunder, either by judicial proceeding or through any power reserved therein or conveyance by Lessee to Exchange Bank, or the exercise of any right, power or privilege reserved therein, shall not be held as a violation of any of the terms or conditions of this Restated Lease.
B. Said Instrument shall be subject to and shall expressly assume all the terms,
covenants and conditions of the Lease and shall not be construed as creating any right in or lien upon the land covered by the Restated Lease insofar as City’s ownership thereof is concerned, or insofar as it may concern the right, title, and interest of any party claiming by, through, or under City, other than Lessee.
C. In the event that Lessee shall fail to pay any installment of rent reserved
under this Restated Lease, or fail to pay any imposition or to make any other payment required to be paid under this Restated Lease, or if Lessee shall fail to perform or observe any other term, covenant, condition or obligation required to be performed or observed under this Restated Lease, then, without waiving or releasing Lessee from any of their obligations, Exchange Bank shall have
the right, but shall be under no obligation, to pay any and installment of rent and/or any tax,
assessment, levy, charge, imposition or other payment, and may perform any other act or take such action as may be appropriate to cause such term, covenant, condition or obligation to be promptly performed or observed on behalf of Lessee, to the end that Lessee’s rights under this Restated Lease, shall be kept unimpaired and free from default, and the obligations due CITY shall be
deemed satisfied.
D. If Exchange Bank shall make any payment or perform any acts or take any action in accordance with the preceding subsection (c), Exchange Bank will give to Lessee 15 days written notice of the intent to make any such payment of, the performance of any such act or the taking of any such action, but failure to give any such notice will not otherwise affect the rights of
Exchange Bank hereunder. In any such event, Exchange Bank, on curing any such default, shall
be immediately entitled to reimbursement for all sums so paid from the Lessee, together with reasonable attorneys' fees and costs.
E. In the event Exchange Bank shall succeed to Lessee’s interest in this Restated Lease, Exchange Bank shall assume all contractual obligations as Lessee under this
Restated Lease (including, but not limited to, the obligation to make rental payments) except that,
City (i) shall not require Exchange Bank to commence use of the Leased Premises until after one hundred and eighty (180) days from the date Exchange Bank acquires title to Lessee’s leasehold interest and (ii) subject to paragraph (g), City shall give Exchange Bank the right to assign this Restated Lease or further let the Leased Premises for the purposes specified in this Restated Lease,
with City’s prior written consent, which consent will not be unreasonably withheld. Any person
taking title to the leasehold interest shall be required to expressly assume all contractual obligations under this Restated Lease (including, but not limited to, the obligation to make rental payments) in the same manner and the same extent had Exchange Bank succeeded to the interest of the Lessee. The foregoing notwithstanding, City may, during said 180-day period, by giving Lender 30 days
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prior written notice, assume the obligations of the Lessee under this Restated Lease and operate the Leased Premises as a golf course for the balance of said 180 days.
F. Neither the occurrence of any event mentioned in this Section 26, nor the
acceptance of rent by City from Exchange Bank or any person, nor the curing of any default under this Restated Lease shall release Lessee from liability under this Restated Lease, except for the default thereby cured.
G. Prior to any sale of its interest in this Restated Lease and resultant
assignment pursuant to subparagraph (e)(ii) above, Exchange Bank shall give City written notice
of its desire to affect such transaction prior to discussing any such transaction with any other person. City shall have the option, exercisable at any time within 60 days after the giving of the written notice provided for by this Section (g) to negotiate such a transaction with Exchange Bank on the terms and conditions as specified in Exchange Bank’s notice to City. The option provided
for in this subparagraph (g) may be exercised by the giving of written notice to Exchange Bank by
City if it is exercised during the 60-day period and if not so exercised, it shall expire. Once notice is given by City, any acquisition by City shall be completed within the negotiation period, unless extended by all parties. If City does not exercise the option provided for by this subparagraph (g), or fails to consummate a transaction after exercising the option, Exchange Bank may negotiate
with any person, provided the negotiation involves a transaction on substantially the same terms
as those set forth in the notice by Exchange Bank to City.
H. Subject to City’s right of first refusal pursuant to Section 24.1, as long as any debt secured by a leasehold Deed of Trust on the leasehold estate created by this Restated Lease shall remain unpaid, unless Exchange Bank shall otherwise consent in writing, the fee title
to the Leased Premises and the leasehold estate in the Leased Premises shall not merge but shall
always be kept as separate estates, notwithstanding the union of such estates either in the City or in Lessee or in a third party by purchase or otherwise. Lessee agrees that as long as there exists an unpaid leasehold Deed of Trust on the leasehold estate of Lessee, this Restated Lease or any renewal thereof shall not be modified, amended or altered and City shall not accept a surrender of
the Leased Premises or a cancellation of this Restated Lease (provided Exchange Bank remedies
any default as provided in this Section) before the expiration or sooner termination of this Restated Lease without the prior written consent of Exchange Bank.
26.2 Termination; Rights of Lender and Lessee and Successors.
A. Notwithstanding anything contained herein in this Restated Lease to the
contrary, City may terminate the Lease only because of a default thereunder and, further, only if:
(i) such default is a failure to pay (after the expiration of any applicable grace periods) any funds due to City under this Restated Lease and Exchange Bank fails to cure such default within thirty (30) days after their receipt of written notice of such default from City, which written notice shall not be delivered until the expiration of the cure period provided to
Lessee in accordance with Section 25.1(A); or
(ii) in the event the cure of any other default under this Restated Lease susceptible of being cured by Exchange Bank is not commenced within thirty (30) days after
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receipt of written notice of such default, which written notice shall not be delivered until the expiration of the cure period provided to Lessee in accordance with Section 25.1(B), and Exchange
Bank fails to carry the same to completion with all reasonable dispatch. If such default cannot be
cured without obtaining possession of the Leased Premises (through a receiver or otherwise) or title to the leasehold estate, if Exchange Bank commences and thereafter pursues to completion proceedings to obtain possession of the Leased Premises (through a receiver or otherwise) and/or to foreclose the lien or diligently proceed to obtain possession of and/or title to the leasehold estate
by deed in lieu of foreclosure or otherwise, such shall be deemed to satisfy the above cure
requirements so long as Exchange Bank, within 30 days after obtaining possession or title, commences the work of curing such default and carries the same to completion with all reasonable dispatch; or
(iii) in the event of a default under this Restated Lease which is not
susceptible of being cured by Exchange Bank, such default shall be deemed to be cured if (A)
within 30 days after receiving written notice from City setting forth the nature of such default, Exchange Bank shall have commenced foreclosure or other appropriate proceedings to obtain possession of the Leased Premises (through a receiver or otherwise) and shall thereafter diligently prosecute such proceedings to completion, or (B) Exchange Bank commences, within such 30
days, and thereafter diligently proceeds to completion, proceedings to obtain title to the leasehold
estate by foreclosure or deed in lieu of foreclosure or otherwise.
B. So long as Exchange Bank is proceeding diligently to fully satisfy the provisions of Section 26.2 (a)(ii) or 26.2 (a)(iii) (provided that in no event shall the taking of such actions exceed 180 days), City’s right to terminate this Restated Lease shall be suspended.
C. Notwithstanding anything herein contained to the contrary, no cure period
granted hereunder shall commence until any and all concurrent grace periods granted to Lessee under this Restated Lease shall have expired for the remedying of such default or for causing it to be remedied.
D. Notwithstanding anything herein contained to the contrary, Exchange Bank
shall not be obligated to continue any actions for possession of the Leased Premises or to continue
any foreclosure proceedings after any defaults under this Restated Lease shall have been cured.
E. City agrees that if Lessee for any reason shall fail within the time limit in this Restated Lease, or shall not be entitled, to exercise its right to renew this Restated Lease for any renewal term as therein provided, or shall fail to properly exercise any of its remaining
extension options, City shall notify Exchange Bank in writing that Lessee has failed as aforesaid,
or is not entitled, to exercise its right to renew this Restated Lease, as the case may be, and Exchange Bank shall have the right for a period of thirty (30) days after the receipt of such notice to elect that this Restated Lease be renewed for such renewal term upon the same terms and conditions and with the same effect as though such right had been exercised by Lessee as set forth
in this Restated Lease.
F. City shall notify Exchange Bank promptly of: (i) the occurrence of any default by Lessee under this Restated Lease, or the occurrence of any event which, with the passage of time or service of notice or both, would constitute a default by Lessee under this Restated Lease;
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and (ii) the receipt by City of any notice (written or oral) from Lessee under this Restated Lease and of any notice (written or oral) noting or claiming the occurrence of any default under this
Restated Lease by City or the occurrence of any event which, with the passage of time or service
of notice or both, would constitute a default by City under this Restated Lease; and (iii) any request made by any party for arbitration proceedings pursuant to this Restated Lease and of the institution or commencement of arbitration proceedings thereunder.
G. Notwithstanding anything contained herein in this Restated Lease to the
contrary, this Restated Lease may be assigned or transferred to any party with City’s prior written
consent, which consent shall not be unreasonably withheld (it being the understanding of the parties that City’s consent is to be based solely upon a showing that the assignee or transferee is of a quality and has the financial capability to perform its lease obligations comparable to Lessee), as a result of Exchange Bank’s foreclosure of its interest upon this Restated Lease or its exercise
of any rights granted under any Instrument or hereunder or if possession or title to this Restated
Lease is acquired by a deed in lieu of foreclosure or otherwise, whereupon such assignor or transferor shall be released from all liability for the performance or observance of the covenants contained on Lessee’s part to be performed and observed from and after the date of such assignment or transfer (it being the intent that such party be liable to perform the obligations
imposed under this Restated Lease only during the period it is in possession of the Leased Premises
or in ownership of the leasehold estate created by this Restated Lease). Additionally, any party who acquires title to this Restated Lease and/or possession of the Leased Premises at foreclosure or by deed in lieu of foreclosure or otherwise, or as a nominee or designee of Exchange Bank, or who receives title to this Restated Lease from such nominee or designee, shall be able to assign
this Restated Lease to any other party with City’s consent which consent shall not be unreasonably
withheld. Notwithstanding the foregoing, any assignment or transfer of this Restated Lease or this Restated Lease to Exchange Bank, as a result of Exchange Bank’s foreclosure of its interest upon this Restated Lease or its exercise of any rights granted under any Instrument or hereunder or otherwise, shall not require the prior consent of City.
H. Notwithstanding anything contained herein, in this Restated Lease to the
contrary, while Exchange Bank, or any of its successors or assigns, holds title to this Restated Lease or possession of the Leased Premises through a receiver or otherwise, and is proceeding to foreclose a lien held by it against the leasehold estate or obtain a deed in lieu of foreclosure, then (i) no provision in this Restated Lease requiring repair, reconstruction or rehabilitation of any
improvements or other property following a fire or other casualty shall be applicable to or
enforceable against any such party in the event of a substantial or uninsurable loss or to an extent in excess of the net insurance proceeds actually received by reason of such fire or other casualty, and (ii) no obligation to operate any business on the Leased Premises shall be applicable to or enforceable against any such party.
26.3 Damage to or Destruction of Improvements. City may not terminate this Restated
Lease for discontinued use provided in this Restated Lease if such discontinued use results from any damage to or destruction of the Leased Premises or improvements thereon which Lessee or Exchange Bank is proceeding diligently to repair.
26.4 Execution by Exchange Bank. This Restated Lease is conditioned upon the
execution of Exchange Bank in the space provided below.
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27. NOTICES AND ADDRESSES
All notices, demands, requests or replies provided for or permitted by this Restated Lease
shall be in writing and may be delivered by any one of the following methods: (1) by personal
delivery; (2) by deposit with the United States Postal Service as certified or registered mail, return receipt requested, postage prepaid to the addresses stated below; (3) by prepaid telegram; or (4) by deposit with an overnight express delivery service. Notice deposited with the United States Postal Service in the manner described above shall be deemed effective three (3) business days after
deposit with the Postal Service. Notice by telegram or overnight express delivery service shall be
deemed effective one (1) business day after transmission to the telegraph company or after deposit with the express delivery service. Notice by personal delivery shall be deemed effective at the time of personal delivery.
For purposes of notice, demand, request, reply or payment, the address of City shall be:
City of Petaluma
C/O City Manager 11 English Street Petaluma, CA 94952
With a copy to:
Director of Parks and Recreation
City of Petaluma C/O City Hall 11 English Street Petaluma, CA 94952
The address of the Lessee shall be:
c/o Airport Business Center 414 Aviation Blvd. Santa Rosa, CA 95403-1069 Attn: Richard A. Coombs and
Larry L. Wasem
Notices to Exchange Bank shall be sent to the following address:
Exchange Bank Attn: Loan Administration Department P. O. Box 403
Santa Rosa, CA 95402
Each party shall have the right to designate a different address within the United States of America by the giving of notice in conformity with this section.
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28. RECORDING
The Restated Lease shall not be recorded; provided, however, a memorandum of this
Restated Lease in a form reasonably acceptable to the City and Lessee may be signed and delivered by both City and Lessee and recorded in the Official Records of Sonoma County.
29. GOVERNING LAW
This Restated Lease and the right and liabilities of the parties to the Lease shall be governed
by the laws of the State of California. If any provision of this Restated Lease is invalidated by
judicial decision or statutory enactment, the invalidity of any such provision will not affect the validity of any other provision of the Restated Lease.
30. CAPTIONS
Captions in this Restated Lease are included for convenience only and are not to be taken
into consideration in any construction or interpretation of this Restated Lease or any of its
provisions.
31. STATUS OF PRIOR LEASE AGREEMENTS
Upon full execution of this Restated Lease and satisfaction of all applicable procedural requirements pursuant to the Petaluma City Charter and other applicable laws and regulations as
necessary for this Restated Lease to be full force and effect, then this Restated Lease shall have
fully replaced the Prior Lease Agreements in their entirety, and the Prior Lease Agreements shall no longer be of any force or effect whatsoever. The City and the Lessee, by executing this Restated Lease, each represent, acknowledge and agree that as of the time this Restated Lease was executed, that there were no conditions of default under the Prior Lease Documents, that there are no
conditions of default under this Restated Lease and that neither the City nor the Lessee has any
claims, demands or offsets against the other party.
32. SURVIVING OBLIGATIONS
The obligations of the Lessee and the City to indemnify, defend and hold harmless pursuant to Section 20 of this Restated Lease shall survive the expiration or earlier termination of this
Restated Lease.
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33. AMENDMENTS
This Restated Lease may only be amended by a writing signed by authorized
representatives of the City and the Lessee, and where applicable or otherwise required, by
Exchange Bank or its successor. Any amendments of this Restated Lease shall also be subject to all applicable procedural requirements pursuant to the Petaluma City Charter and other applicable laws and regulations.
34. ATTORNEYS’ FEES AND COSTS OF LITIGATION
If either the City or Lessee should find it necessary to bring an action in a court of law to
enforce any of its rights or remedies under this Restated Lease, both parties agree that the prevailing party in any such litigation shall be entitled to recover its reasonable attorneys’ fees and costs incurred by way of such action.
35. INCORPORATION OF RECITALS AND EXHIBITS
The Recitals of this Restated Lease and the Exhibits attached hereto are incorporated herein
by this reference as if set forth in full and constitute a material part hereof.
EXECUTED in multiple original counterparts, which constitute the same single Lease instrument, on the date stated above.
Execution signatures on the following page.
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IN WITNESS WHEREOF, the parties hereto have set their hand to this Amended Lease, effective as of the Effective Date.
CITY: CITY OF PETALUMA
By: City Manager
ATTEST:
City Clerk
APPROVED AS TO FORM:
City Attorney
Finance Director
Risk Manager
LESSEE: ROOSTER RUN GOLF CLUB, LLC, a California limited liability company
By: ROOSTER RUN GENERAL PARTNERS, a California general partnership, Manager
By:
RICHARD A. COOMBS,
General Partner
The undersigned hereby accepts and approves the terms of this Amended Lease.
EXCHANGE BANK
By:
Name:
Its:
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APP'"ove Mrdrnancz I 5 ACS,
L E A S E A G R E E M E N T
This Lease Agreement ( "Lease ") is entered into this /uzh
day of Jdnlla 19_U by and between the CITY OF PETALUMA, ai
public body, corporate and politic of the State of California
Lessor "), and EMPIRE GOLF INC., a California corporation
Lessee ").
1. LEASED PROPERTY
Lessor leases to Lessee and Lessee leases from Lessor, for the
term and upon the terms and conditions set forth in this Lease,
that parcel or parcels of real property constituting approximately
126 acres on or near the Municipal Airport and described with more
specificity in Exhibit "A ", which is attached to this Lease and
made a part of this Lease for all purposes, along with all
easements, covenants, and other appurtenant rights associated with
said real property (collectively the "Leased Premises ").
2. CONSTRUCTION AND USE OF LEASED PREMISES
Lessee agrees it will use the Leased Premises for the
construction and operation of a public golf course and other
activities customarily associated with or incidental to the
operation of a public golf course, including without limitation,
sale or rental of golf - related merchandise at a golf professional's
shop, furnishing of lessons by a golf professional, operation of a
driving range, and sales of food and beverages, including liquor
sales.
Lessee shall not use the Leased Premises for any unlawful purpose
and shall comply with all valid laws, rules and regulations
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applicable to the Leased Premises or the businesses conducted on
the Leased Premises.
3. QUIET ENJOYMENT
Subject only to the terms of this Lease, so long as Lessee
complies with its obligations under this Lease, Lessor shall secure
to Lessee the quiet and peaceful enjoyment of the Leased Premises
and the sole and exclusive possession of the Leased Premises
without objection or interference from Lessor or any party claiming
under Lessor.
4. TERM
4.1 Initial Term
The term of this Lease shall be for forty (40)
years, beginning on the first day of the calendar month following
completion of the Construction Period as that term is hereafter
defined. The Construction Period shall be that period of time
beginning with the execution of this Lease and continuing until
such time as the parties recognize and agree in writing that the
golf course is ready for public play. The standards for agreement
that the golf course is ready for public play shall be: completion
of Lessor's Required Obligations pursuant to subsection 6.1 of this
Lease, completion of the Lessee's Improvements pursuant to
subsection 6.3 of this Lease, issuance of a certificate of
occupancy for the clubhouse and other structural improvements
constructed upon the Leased Premises, installation of the
irrigation system upon the golf course and successful maturation of
the turf grasses and other landscaping required for practical use
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and play upon the golf course. Lessee's obligations for the
payment of rent pursuant to Section 7 shall not commence until the
first calendar month following the completion of the Construction
Period.
4.2 Optional Term
Lessee is granted one (1) successive twenty (20)
year option to extend the initial term of this lease on all terms,
covenants, and conditions herein continued in accordance with
provision regarding percentage rent in option period through
termination, Lessee shall give written notice of the exercise of
the option to Lessor not later than one hundred eighty (180) days
prior to the expiration of the initial term.
5. LEASE YEAR DEFINED
A "Lease Year" is that period of 12 consecutive calendar
months beginning with the term of the Lease as defined in Section
4. The Lease Year may be changed by written agreement of the
parties. Each Lease Year will constitute a separate accounting
period for the purpose of computing percentage rent, and gross
revenue.for any Lease Year shall not be carried forward or backward
into any other Lease Year. If this Lease is terminated prior to
the end of a Lease Year, minimum rent and percentage rent will be
subject to proration.
6. CONSTRUCTION OF THE GOLF COURSE
6.1 Lessor's Required Obligations
The obligations identified in this subsection 6.1
shall be referred hereafter as "Lessor's Required Obligations."
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Lessor shall provide to Lessee the real property identified in
Section 1 and Exhibit "A" of this Lease. In order to satisfy
Lessor's Required Obligations under the terms of this subsection,
it is agreed that Lessor shall secure and provide all of the
following without limitation:
A) Design, easements, and permits for treated
waste water line to golf course site.
S) Share cost equally of fencing on property
north of East Washington Street to secure golf course from playing
fields and other relational activities in park area, work to be
done by Lessee.
C) Subordination of land to allow financing
of project.
D) All necessary archeological, fish and
game, biological soils analysis or other required studies or
approvals necessary to commence construction.
E) All necessary environmental permits such
as an environmental impact report or negative declaration.
F) All necessary map recordation, conditional
use permits, easements or zoning approvals.
G) Indemnification from any toxic waste
liability existing as of the commencement of the Lease.
H) At the point of ultimate connection, all
necessary and required utilities, including without limitation, but
only if available, electricity, water, sewer, and fire hydrants.
6.2 Irrigation Water
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Lessor and Lessee acknowledge that the golf course
is to be irrigated with secondary treated effluent in accordance
with any applicable law, regulation or rule including the Use
Permit from the City of Petaluma.
A) Priority Status. Anything to the contrary
in this Lease notwithstanding, Lessor covenants that it will
provide irrigation water to the Premises and the golf course as
part of its sewage effluent discharge program, for energy pumping
costs only, and in priority to all other customers other than those
with valid and existing contracts which were executed prior to
January 1, 1989, or renewals of said contracts, and will not alter
its discharge program in any respect to change its location in such
a manner as to deprive the Premises or the golf course of such
irrigation water unless supplemented by another source. In the
event federal, state, local, other law, ordinance, rule or
regulation ever require that the sewage effluent used for any
treatment other than that currently used by the Lessor, Lessor
agrees to process the sewage effluent used on the Premises and the
golf course in conformance with such requirement, at Lessor's sole
cost and expense, and to continue to provide the required
irrigation water or alternate source of water agreeable to Lessee,
to the Premises and the golf course as required by this paragraph.
6.3 Lessee's Required Obligations
The obligations identified in this Subsection 6.3 shall
be referred hereafter as "Lessee's Required Obligations." In order
to satisfy Lessee's Required Obligations under the terms of this
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subsection, it is agreed that Lessee shall secure and provide all
of the following without limitation:
A) An 18 hole golf course having a length of not
less than 6,200 yard and par of at least 72.
B) A driving range with a minimum of 30 all grass
tees.
C) A clubhouse building to include golf shop,
restaurant, bar, kitchen, and rest rooms. Building to be no less
than 6,000 square feet, and designed for future expansion.
D) Landscape and irrigation improvements,
including an automatic irrigation system, which will be permanent,
for all tees, greens, fairways, and around all structures.
E) Night lighting for the driving range and
parking lot.
F) A maintenance building for golf course
equipment, storage, supplies, and repairs.
G) Necessary mechanical, electrical, and plumbing
installations.
H) Parking for golf course and driving range.
I) Cart storage building for the power cart
operations.
J) Extension of treated water main at the current
end of the line location on the Adobe Creek Golf Course to the golf
course site.
K) Such other improvements as are required to
develop, maintain and operate a 18 hole golf course facility.
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L) Additional Construction. Subject to written
approval of Lessor, Lessee may elect to construct certain
additional facilities which are compatible with the Required
Construction and which provide optional services for the Leased
Premises including without limitation, banquet facilities, and
outside barbecue facilities.
M) Lessee shall also provide an additional thirty -
three (33) acres, as specifically described in Exhibit B, adjoining
Lessors property to establish a total of one hundred sixty (160)
acres for the full golf course facility.
N) Necessary improvements to East Washington
Street crossing connecting golf course on the south side of East
Washington Street with golf course on north side, for golf cart and
pedestrian (golfers) access.
6.4 Construction Plans and Approval
A) Conceptual. Lessee will submit golf course
route plan and conceptual facilities plan for Phase 1 the golf
course to Lessor not later than thirty (30) days following
execution of this Agreement for Lessor's approval, which is not to
be unreasonably withheld. Lessor's response to the submitted
plans, including any recommendations for change, is to be submitted
to Lessee not later than thirty (30) days following Lessor's
receipt of the schematic plans.
B) Lessee shall submit for approval all
development and Construction Plans for final approval in the
following phases:
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Phase 1 Golf Course and Driving Range
Phase 2 Maintenance Building
Phase 3 Clubhouse, Cart Storage Building, Parking Lot
and Street Improvements
Lessor's response to these development and
construction plans, including any recommendations for change, shall
be submitted to Lessee not later than sixty (60) days following
Lessors receipt of plans.
C) "As Built" Plans. Within sixty (60) days
following completion of construction upon the Leased Premises,
Lessee shall furnish Lessor a complete set of reproducible and two
sets of prints of "as built" plans.
6.5 Construction
Following Lessor's approval of development plan and
construction plans by Phase, Lessee, as the general contractor,
shall cause the commencement of the Required Construction upon a
date mutually agreed upon by Lessor and Lessee. Lessee shall
mutually comply with all approved plans unless a change order or
alteration is otherwise agreed to by Lessor. Lessor shall have the
right to inspect all construction for the purpose of confirming
that Lessee is adhering to the approved plans and specifications.
Lessee shall also construct or cause to be constructed upon the
Leased Premises all lines, structures and facilities required in
order to provide the Leased Premises with all necessary utility
services.
A) Mechanics Liens or Stop- Notices. Lessee shall
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at all times indemnify, defend and hold Lessor harmless from all
claims for labor and materials in connection with the construction,
repair, alteration or installation of structures, improvements,
equipment of facilities upon the Leased Premises and from the cost
of defending against such claims, including reasonable attorney
fees.
In the event a lien or to stop notice is
imposed upon the Leased Premises as a result of such construction,
repair alteration or installation, Lessee shall either:
a) Record a valid release of lien, or
b) Procure and record a bond in accordance
with Section 3143 of the California Civil Code, which frees the
Leased Premises from the claim of the lien or stop- notice and from
any action brought to foreclose the lien.
6.6 Lessee's Assurance of Completion
Prior to commencement of construction. Lessee shall
furnish Lessor suitable evidence of money available, in an amount
of not less than four million dollars ($4,000,000.00) in order to
complete the Required Construction. Such evidence may take the
form of one of the following:
a) a performance bond containing the
provisions of a labor and material bond supplied by Lessee's
contractor or contractors, provided said bonds are issued jointly
to Lessee and Lessor as obligees; or
b) an irrevocable letter of credit, in an
amount not less than $4,000,000.00, or
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c) cash deposited in an escrow acceptable to
Lessor, with interest to accrue to Lessee, but with instructions to
the escrow agent to the effect that until construction is
completed, funds deposited in the escrow may not be released or
pledged without Lessor's written approval; or
d) any combination of the above. All bonds
and letters of credit must be issued by a company qualified to do
business in the state of California.
6.7 Ownership of Improvements
A) All buildings, improvements and facilities, other
than trade fixtures and personal property constructed or placed
upon the Leased Premises by Lessee, shall become Lessor's property
upon the termination of the Lease term.
B) Lessee's land contribution of 33 +/- acres, shall
become property of Lessor upon termination of Lease.
7. RENT
In consideration of Lessor executing this Lease and grant the
rights provided in this Lease, Lessee will pay to Lessor at the
address listed the consideration outlined in Sections 7.1 and 7.2.
7.1 Annual Rent
a) Lessee shall pay Lessor the following
annual rent in the first ten (10) years of the lease:
Years 1 through 5 $1,000 per year
Years 6 through 10 $10,000 per year
b) Payment of Annual Rent. In the years one
1) through ten (10) of this lease the annual rent payment shall
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be due no later than fifteen (15) days following the first month
of each "Lease year" as defined in Section 5.
7.2 Percentage Rent
a) Percentage rental shall begin in the
eleventh (11th) year of this lease. The first payment of
Percentage Rental shall occur in arrears in the second (2nd) month
of the eleventh (11th) year of the lease. Schedule of Rent shall
be as follows:
Percentage Rent Schedule
YEARS 11 -15 16 -20 21 -25 26 -40 41+
GREEN FEES 5.0% 7.5% 10.0% 10.0% 16.0%
CARTS 5.0% 7.5% 7.5% 10.0% 10.0%
RANGE 5.0% 7.5% 7.5% 10.0% 10.0%
OTHER REVENUE 0.0% 0.0% 2.5% 5.0% 5.0%
b) Monthly Statement. On or before the 15th
day of each calendar month starting in the second (2nd) month of
the eleventh (11th) year of the lease. Lessee shall deliver to the
Lessor a written statement certified as correct by Lessee, of the
amount of Lessee's Gross Revenue during the preceding calendar
month.
C) Records. Lessee shall, with respect to
business done on Premises, keep true and accurate accounts,
records, books and dates (hereinafter called "records ") , in a form
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satisfactory to the Lessor, which shall contain a breakdown between
Gross Revenue from the categories set out in "Percentage Rent
Schedule" in 7.2a). The Lessor may, at the Lessor's expense,
require an audit of each annual statement.
Accurate receipt printing registers shall be installed
and kept by Lessee on the premises, which shall show and record
each and every sale transacted. Rentals and fees shall be recorded
when made or performed.
d) Inspection of Records: Audit. The Lessor
shall be entitled at any time throughout the initial and optional
term and for one (1) year thereafter to question the accuracy of
any statement furnished by Lessee hereunder. For such purpose
Lessee shall keep safe and intact for at least four (4) years after
the end of each lease year all of Lessee's records, sales slips,
and other material Lessee is required to maintain hereunder with
respect to Gross Revenue. Lessee shall upon written request, make
the same available for examination at any reasonable time for one
1) year after the end of lease year to which such records relate.
Lessee hereby agrees that the Lessor, its employees, agents and
representatives, at all reasonable times, shall have the right to
inspect and examine all such records, sales slips and other
material by which the Lessor may be enabled to ascertain the amount
of Lessee's Gross receipts hereunder. Lessee agrees to furnish the
Lessor true and complete copies of its annual retail sales and use
tax returns at the time such is filed with the State of California
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relative to its operations at the golf course. Upon written
request by the Lessor, Lessee agrees to immediately furnish the
Lessor with a copy of such records and materials for the reasonable
cost of producing same.
8. GROSS REVENUE
For purposes of calculating Percentage Rent, in Section 7.2
Gross Revenue" shall mean all money received by Lessee as a result
of the sales of goods or the provision of services on the Leased
Premises, but shall not include:
1) Cash refunds or credits allowed on returns by customers;
2) Sales taxes, excise taxes, gross receipts taxes and other
similar taxes now or later imposed upon the sale of food,
beverages, merchandise or services and paid by Lessee to the
appropriate taxing authority, whether added to or included in the
selling price;
3) The actual uncollectible amount of any check or bank
draft including costs of collection received by Lessee as payment
for goods or services and returned to Lessee from a customer's bank
as being uncollectible (commonly "non- sufficient funds" checks),
but only after Lessee has made reasonable efforts to collect on the
check;
4) The actual uncollectible amount of any charge or credit
account (commonly "bad debts ") incurred including costs of
collection by Lessee for the sale of merchandise or services;
provided, however, that the credit was extended to the customer by
Lessee, and that reasonable efforts to collect said account have
13
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
been made;
5) The actual uncollectible amount of any sale of
merchandise or services for which Lessee accepted a credit card;
including costs of collection provided, however, that Lessee has
made reasonable efforts to collect the debt after being notified by
the issuing bank of the invalidity or uncollectibility of the
charge;
6) Interest or other charges paid by customers for extension
of credit;
7) Sales or trade -ins of machinery, vehicles, trade fixtures
or personal property used in connection with Lessee's operation of
the Leased Premises;
8) The value of any merchandise, supplies or equipment
exchanged or transferred from or to other locations of business of
Lessee where such exchange or transfer is not made for the purpose
of avoiding a sale which would otherwise be made from or at the
Leased Premises;
9') Receipts in the form of refunds from or the value of
merchandise, supplies or equipment returned to shippers, suppliers
or manufacturers;
10) The amount of any cash or quantity discounts received
from sellers, suppliers or manufacturers;
11) The amount of any gratuities paid or given by customers
to or for employees of Lessee;
12) Receipts from the sales of uniforms or clothing required
14
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
to be worn by employees;
13) Amounts attributed to meals served or provided to
employees of Lessee;
14) Receipts from the sale of waste or scrap materials
resulting from Lessee's operations;
9. FEES AND CHARGES
Lessee shall establish and keep current a comprehensive
schedule of fees for golf play and cart rentals.
9.1 Establishing of Fees Fees for golf shall be determined
in the following manner annually.
A) Survey the regular 18 hole weekday and
regular 18 hole weekend green fees from the following five ( 5 ) area
courses. Initial survey and setting of fees shall be done sixty
60) days prior to course opening, and thereafter on the
anniversary date annually.
1) Peacock Gap Golf Course
2) Windsor Golf Course
3) Mt. Shadows North Golf Course
4) Indian Valley Golf Course
5) Oakmont West Golf Course
B) Compute the average fee charged for the
aforementioned categories, from the five courses.
C) The charge for said service charged by
Lessee shall be no greater than the average of these five courses.
D) A comprehensive review of applicability of
surveyed" courses shall occur every five (5) years. Any course
15
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
that changes their operating policies significantly shall be
replaced at time of annual review by mutual consent of Lessor and
Lessee.
9.2 Residents Discount All residents of the City of
Petaluma shall receive a 20% discount off any published green fee.
The method of administering the discount shall be mutually agreed
upon by Lessee and the City of Petaluma Parks and Recreation
Department.
9.3 Senior /Junior Discounts All resident Seniors (62 years
old and older) and Juniors ( 18 years old and under) shall receive
a minimum of an additional 100 off the regular resident weekday
green fee. Days and hours of availability of discount shall be
determined by Lessee, not to be unreasonably restricted.
All other fees, including without limitation, fees for range
balls, lessons, rentals, food and beverage, and golf shop
merchandise shall be at sole discretion of Lessee.
A register receipt, showing date and time of issue, and
amount paid, shall be tendered to every person paying for fees or
service's.
10. SERVICES TO BE PROVIDED BY LESSEE
Pursuant to this Agreement, Lessee shall provide the services
and operate the golf course facilities as described below.
10.1 Management Lessee agrees to operate and manage the golf
course facilities and services offered in a high quality manner
comparable to other courses providing similar facilities and
services during the entire Lease term. Lessee shall provide, at a
16
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
minimum, a full time Head Golf Professional who shall be a "Class
A" member of the Professional Golfers Association of America, and
a full time Golf Course Superintendent who is a "Class A" member of
the Golf Course Superintendents Association of America. Lessee
agrees it shall operate and maintain a standard of service at least
equal to that of the golf course facilities aforementioned in
9.1(A).
10.2 Hours of Operation Lessee will establish hours of
operation, subject to Lessor's approval. Lessee agrees it will
conduct business on the Leased Premises in conformance with
published hours and days of operation, as established, unless an
exception or change is otherwise approved by Lessor.
10.3 Lessee's Employees Lessee will ensure that its
employees shall at all times conduct themselves in a credible
manner. Lessee shall maintain a staff adequate to operate and
administer all facilities located on the Leased Premises.
10.4 Dress and Conduct Standards Lessee shall set dress and
conduct standards, subject to Lessor's approval, and shall be
permitted to deny entry or permission to play to anyone who fails
to conform to those standards. Lessee shall have the right to, in
its sole judgement, refuse admission and /or service to persons who
are drunk, disorderly, under the influence of drugs, or who conduct
themselves in a manner that could result in injury or harm to
persons or property on the Leased Premises. Lessee shall also have
the right to suspend privileges as he deems necessary.
10.5 Tournaments Lessor shall have the right two times
17
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
4
during each Lease year to schedule a tournament or tournaments for
the full day. Lessee and Lessor will agree in advance, once a
year, on the dates for such tournaments. Tournament participants
will pay the then - prevailing rates for golf tournament fees and
services.
10.6 Public Course: Non - Discrimination Fair and equal use
of the Premises and facilities and hiring, treatment and
advancement of employees there at by Lessee shall not in any manner
be denied or abridged on the basis of sex, race, color, religion,
ancestry, national origin, or in any other manner discriminatory
under federal, state or local law.
10.7 Clubs, Tournaments and Special Events
A) Clubs. Lessee agrees to encourage formation of
recognized golfers' organizations by users of the golf facility.
The parties hereto agree that gender specific clubs, for example
men's and women's clubs, seniors clubs, or junior clubs, can be
important to the success of a golf course; and Lessee shall have
the right, in Lessee's reasonable business judgement, to establish
such clubs or other similar clubs may be granted certain
privileges, including, but not limited to, starting time
preferences and annual use playing cards, with a first preference
given to Petaluma residents.
B) Tournaments and Specific Events. Lessee agrees
to accommodate and encourage tournaments and to consider favorably
suggestions for events calculated to accommodate the public,
increase golf play at the course, and otherwise mutually benefit
1s
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
the parties hereto. The scheduling of and rules for all
tournaments shall be determined by Lessee. Lessor and Lessee
acknowledge that these types of events by their very nature curtail
the public access to the course during such events.
10.8 Lessor's Right of Inspection Lessor, acting through its
director of Parks and Recreation ( "Director "), shall have the right
to enter upon and inspect the Leased Premises at any time during
normal business hours.
11. TAXES
Lessee will pay all taxes, license fees or other
governmental charges assessed or imposed on the personal property
and improvements owned by Lessee located on the Leased Premises or
upon the business operations of Lessee conducted on the Leased
Premises.
12. UTILITIES
Lessee will pay before delinquency all charges for utilities,
including electricity, gas, heating, cooling, telephone and water,
used by Lessee on the Leased Premises.
13. CAPITAL IMPROVEMENTS
13.1 Initial Term
Starting in year thirty -one (31), Lessee will begin a
major renovation and modernization program. Work shall be
conducted by Lessee. Payment will be provided by creating a
capital improvement trust fund of an additional three percent (30)
of the gross green fee revenues annually commencing in year thirty -
one (31). This will be deposited in an account annually approved
19
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
by Lessor, all interest to go to
approval will make improvements to
on a basis as agreed by parties.
gross green fee revenue shall be
and is an addition to percentages
13.2 Optional Term
account. Lessee with Lessor's
golf course facility annually or
This three percent (3 %) of the
paid pursuant to subsection 7.2,
set forth in 7.2.
Starting in year forty -one (41), or the first year of the
Optional Term, said capital improvement trust fund as described in
13.1 shall be increased from an additional three percent (3 %) to an
additional four percent (4 %) of gross green fee revenue. Fund
shall be administered as detailed in 13.1, and is an addition to
percentages set forth in 7.2.
14. MAINTENANCE AND REPAIRS
Lessee acknowledges it is acquiring the Leased Premises in
their current "as is" condition, except as provided in subsection
14.1 below.
14.1 Lessee's Obligations
Lessee assumes sole responsibility for maintenance and
repair 'of the Leased Premises and Lessee will maintain the Leased
Premises in good order and in sanitary and safe condition at
Lessee's sole expense. Lessee agrees it will maintain the Leased
Premises in conformance with the maintenance standards specified in
Exhibit "C ", which is attached to this Lease and made a part of
this Lease by this reference.
15. LESSOR'S COOPERATION
City recognizes and acknowledges that Lessee will need the
a*
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
assistance and cooperation of City in order to properly perform and
fulfill Lessee's covenants and obligations under this Lease.
Therefore, City agrees it will secure for Lessee, with Lessee's
assistance as needed, all permits or licenses that are within the
jurisdiction and authority of City or within the jurisdiction and
authority of City's various departments, agencies officers, boards
or councils, and that are required in order for Lessee to fulfill
its obligations under this Lease. City agrees it will designate a
specific officer or agent (City's "Coordinator ") having appropriate
experience and authority whose responsibility it is to work with
Lessee in assuring that Lessee obtains the full cooperation and
assistance of City, subject to the terms of this Lease and all
applicable laws.
15.1 Initial Construction Phase
During the initial construction phase, the Coordinator
shall organize meeting with all appropriate agencies for the
purpose of acquiring design and construction information; submit
and secure the necessary planning approvals, mass grading permits
building construction permits; and shall aid in developing
alternative solutions to issues raised in the planning and plan
check phases.
16. INSURANCE
The following types of insurance coverage relating to the
Leased Premises and Lessee's operations of the Leased Premises
shall be maintained at all times throughout the Lease Term:
16.1 Liability Insurance
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DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
Lessee will maintain, at Lessee's sole expense, a policy
or policies of comprehensive general liability insurance, naming
Lessor and Lessee as insureds, with coverage of not less than one
million dollar ($1,000,000.00) combined single limit for bodily
injury and property damage. The liability limit of $1,000,000 per
occurrence shall be reviewed every five years, Lessor shall
reevaluate said liability limits and such limits shall be adjusted
as determined by the Lessor. Said adjustments shall be reasonable
and shall be determined based on golf course operations of similar
types.
16.2 Worker's Compensation
Lessee will maintain, at Lessee's sole expense, a policy
or policies of worker's compensation insurance in compliance with
applicable California law.
16.3 Fire Insurance
Lessee shall maintain, at Lessee's sole expense, a
standard form policy or policies of fire and special form insurance
on the Leased Premises, including the clubhouse and related
buildings and all personal property, furnishings and equipment
owned by Lessee, in an amount equal to the replacement cost. Said
fire policy shall provide that the Lessor and Lessee are to be co-
recipients of any insurance proceeds.
Lessor, will request Lessee to provide Lessor with
suitable evidence of insurance coverage. Such a request will be
satisfied by submission of a copy of the policy or policies then in
effect or a certificate of coverage and proof of payment of
22
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
premiums. Any insurance required to be carried under this Lease
may be included as part of any blanket or other policy or policies
of insurance, subject to the provisions of this Lease. Lessor, its
officers, employees and agents shall be named as additional
insureds under Lessee's policy and that policy shall operate as
primary insurance such that no other insurance obtained by Lessor
will be obligated to contribute to any insured loss.
17. INDEMNITY
Lessee shall indemnify, defend and hold Lessor harmless from
all claims, demands, causes of action and liability resulting from
injury to persons or damage to property sustained on or about the
Leased Premises and arising from Lessee's operations or as a
proximate result of the acts or omissions of Lessee or its
employees or agents. This provision does not apply, however, to
any such liability as may be the result of the direct and proximate
negligence or willful misconduct of Lessor or Lessor's employees or
agents acting within the scope of their employment or agency.
18. DAMAGE AND RESTORATION
If, the building or other improvements on the Leased Premises,
or the personal property leased under this Lease, should be
partially damaged or totally destroyed by fire or other casualty,
Lessee will repair, reconstruct or replace the buildings,
improvements or personal property to a condition as nearly similar
as possible. If repair, reconstruction or replacement is
prohibited under then - existing laws, or if the parties should
decide among themselves that reconstruction or replacement is not
23
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
warranted, this Lease shall terminate without further obligation on
the part of either party.
18.1 Rental Abatement and Term Extension
If Lessee is unable to use all or a significant portion
of the Leased Premises during repair, reconstruction or replacement
as provided for in this section, Lessee's rental obligations under
Section 5 shall be abated or reduced or adjusted by a percentage
amount equal to the percentage loss of gross revenue as defined in
paragraph 8 and attributable to such interruption as appropriate
until such time as Lessee is again able to use the Leased Premises
for their intended purpose. The term of this Lease shall also be
extended for a period equivalent to the length of time needed for
Lessor to restore the Leased Premises and make them available to
Lessee for Lessee's use pursuant to Section 2 of this Lease.
19. EMINENT DOMAIN
In the event that title to any portion of the leased premises
is taken by condemnation or by right of eminent domain, the lease
shall- not be terminated, but all rent and other payments due the
Lessor during the remaining term of the lease shall- be reduced by
a percentage amount equal to the percentage of gross revenue as
defined in paragraph 8 attributable to such taking.
If there is a taking by right of eminent domain, the award
shall belong to and be paid to Lessor, except that Lessee shall
receive from the award the following: (a) a sum attributable to
the value of Lessee's leasehold estate, and (b) a sum
attributable to loss of good will.
24
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
20. FRUSTRATION OF PURPOSE
At any time during the term of this Lease, if the governing
body of any political subdivision having competent jurisdiction
over the Leased Premises should enact any valid zoning ordinance,
law or regulation which prohibits the use of the whole or a
substantial part of the Leased Premises for the purposes as
provided in Section 2 of this Lease, or if an event of force
majeure occurs, including without limitation, declared or
undeclared war, sabotage, riot or other acts of civil disobedience,
acts of government, labor disputes, shortages of fuel, accidents,
fires, explosions, floods, earthquakes,, or other acts of God, which
substantially prevents Lessee's fulfillment of its obligations as
provided for in Section 2 of this Lease, it is agreed that Lessee
may elect, within one hundred twenty ( 120 ) days after the effective
date of such ordinance, law, regulation or the occurrence of the
event of force majeure, to cancel this Lease and surrender
possession of the Leased Premises. Any such cancellation and
surrender will act to release and discharge Lessee from any further
obligation under this Lease.
21. ASSIGNMENT
Except as otherwise provided below, Lessee shall not assign
this Lease or sublet all of the Leased Premises without the prior
written consent of Lessor, and such consent shall not be
unreasonably withheld. Lessee shall notify Lessor of any proposed
assignment or subletting at least sixty (60) days prior to the
proposed effective date of such assignment or subletting. In the
25
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
event that any such assignment or subletting is approved by Lessor,
the assignee or sublessee shall agree in writing to be bound by all
of the covenants of this Lease required of Lessee and Lessor shall
thereafter release Lessee from liability under this Lease.
21.1 Right of First Refusal
In the event that prior to the stated expiration date of
the Lease term, Lessee should elect to assign all of its interest
in this Lease pursuant to the provision of Section 21 above, Lessee
shall submit the proposed terms and conditions of any such
assignment, in writing, to Lessor or Lessor's nominee shall then
have no more than sixty (60) days from the date of such submission
within which to exercise a right of first refusal to acquire
Lessee's leasehold rights on terms and conditions no more favorable
than those offered by the prospective assignee. Failure. to
exercise such right of first refusal shall constitute approval of
the prospective assignee under paragraph 21. In either event,
Lessee shall be released from any and all further liability under
this lease other than for events which may have occurred during the
term of Lessee's operation of the leased premises.
22. BREACH AND REMEDIES
The following conditions will constitute a breach of this
Lease and a default thereunder:
22.1 Conditions of Default
a) If Lessee fails to pay rent or fulfill any other
monetary obligation of Lessee to Lessor, and Lessee fails to cure
26
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
such monetary default within thirty (30) days after written notice
from Lessor to Lessee of such monetary default.
b) If either party fails to perform any of its other
non - monetary obligations under this Lease when due or called for,
and the party in default fails to cure such non - monetary default
within sixty (60) days after written notice from the non - defaulting
party of such non - monetary default; provided, however, that if the
nature of the non - monetary default is the result of a force majeure
occurrence or is otherwise of a nature such that it cannot be fully
cured within that sixty (60) day period, the party in default shall
have such additional time as is reasonably necessary to cure the
default so long as the party in default is proceeding diligently to
complete the necessary cure after service of notice by the non -
defaulting party.
c) If Lessee shall be adjudged bankrupt, or a receiver
be appointed for Lessee's property, or if Lessee's interest in this
Lease shall pass by operation of law to any person other than
Lessee and such adjudication, appointment or order is not vacated,
dismissed, or set aside within one hundred twenty (120) days from
its entry.
d) In the event the Lessee does not cause golf course
completion and open for play, as described in subsection 4.1, prior
to December 31, 1994, Lessor shall have the option to terminate the
Lease.
22.3 Remedies
If any of the conditions identified in sub - section 22.1
27
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
above should occur and the party in default does not cure the
default, the non - defaulting party may elect to terminate this Lease
immediately and seek all remedies as provided under law and equity
If Lessee is the party in default. Lessor may terminate Lessee's
right to possession without termination of the Lease. If Lessor
elects to continue the Lease and so informs Lessee in writing,
Lessor will retain the right to recover rent and all other payments
at such time as they become due under this Lease and, Lessee may
assign its interest in the Lease pursuant to Section 18 of this
Lease. Lessor may also elect to rent the Leased Premises to any
other party at a rental rate and for such terms as Lessor deems
practicable, and the rent so received shall be credited to the
account of Lessee, less any expense of repossession and re- renting.
During the unexpired remainder of the Lease Term. Lessee will be
liable for any deficiency that results from Lessor re- renting the
Leased Premises at a lesser amount than the minimum rent called for
in this Lease.
If either party at any time by reason of the other
party's' default pays any sum or does any act that requires payment
of any sum, the sum paid by the non - defaulting party shall be
immediately due and owing by the defaulting party to the non -
defaulting party at the time the sum is paid, and if paid at a
later date shall bear interest at the rate of ten percent (10%) per
annum from the date the sum is paid by the non - defaulting party
until the non - defaulting party is reimbursed by the defaulting
party.
28
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
If either Lessor or Lessee should find it necessary to
bring an action in a court of law to enforce any of its rights or
remedies under this Lease, both parties agree that the prevailing
party in any such litigation shall be entitled to a recovery of
reasonable attorneys' fees and costs incurred by way of such
action.
23. NOTICES AND ADDRESSES
All notices, demands, requests or replies provided for or
permitted by this Lease shall be in writing and may be delivered by
any one of the following methods: (1) by personal delivery; (2) by
deposit with the United States Postal Service as certified or
registered mail, return receipt requested, postage prepaid to the
addresses stated below; (3) by prepaid telegram; or (4) by deposit
with an overnight express delivery service. Notice deposited with
the United States Postal Service in the manner described above
shall be deemed effective three (3) business days after deposit
with the Postal Service. Notice by telegram or overnight express
delivery service shall be deemed effective one (1) business day
after transmission to the telegraph company or after deposit with
the express delivery service. Notice by personal delivery shall be
deemed effective at the time of personal delivery.
For purposes of notice, demand, request, reply or
payment, the address of Lessor shall be:
City of Petaluma
C/O City Manager
11 English Street
Petaluma, CA 94952
With a copy to:
29
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
Director of Parks and Recreation
City of Petaluma
C/0 City Hall
11 English Street
Petaluma, CA 94952
The address of the Lessee shall be:
Empire Golf Inc.
Attn: Rod Metzler, President
7 Fourth Street, Suite 61
Petaluma, CA 94952
Each party shall have the right to designate a different
address within the United States of America by the giving of notice
in conformity with this section.
24. GOVERNING LAW
This Lease and the right and liabilities of the parties to the
Lease shall be governed by the laws of the State of California. If
any provision of this Lease is invalidated by judicial decision or
statutory enactment, the invalidity of any such provision will not
effect the validity of any other provision of the Lease.
25. CAPTIONS
Captions in this Lease are included for convenience only and
are not to be taken into consideration in any construction or
interpretation of this Lease or any of its provisions.
EXECUTED in multiple original counterparts, which constitute
the same single Lease instrument, on the date stated above.
0
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
EMPIJR-F GOLF INC. (Lessee)
Roa Metzler
President
Its
CITY OF PETALUMA (Lessor)
City/ Manager
ATTEST:
City Clerk
APPROVED AS TO FORM:
City Attorney
32
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
Exhibit "
A"
a. -
e
4
PPP
bd
5
1liiiilr
r
aa
rrasaass
G wrwAuwwna
Leased
land
in
highlighted
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approximations) C
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
1
2
EXHIBIT "B"
LESSEE'S LAND CONTRIBUTION
Being a portion of Lot 250, as said lot is numberea and designated upon
Rowe's Map of the Petaluma Rancho recorded in the office of the
County Recorder of Sonoma County on September 7, t866 in Hook 8 of
Maps, page 15, Sonoma County Records, said portion being more
particularly described as follows to-
wit:- Beginning at point on the Southeasterly line of Washington Street,
said point being on the division line between Lots 243 and 250; thence
from said point of beginning along the Southeasterly line of Washington
Street North
350
East 2019.60 feet, more or-less, to the most Westerly
corner of Lot to as shown and designated upon Map of East Side, a
portion of Lot 250, Petaluma Ranchgj, recorded February 9, 1912 in
Hook 27 of Maps, page 16, Sonoma county Records thence along the
Southwesterly line of said Subdivision North 54 39' East 2140.38 feet,
more or less, to the intersection thereof with the Southeasterly line
of Lot 250 of said Petaluma Rancho, ' thence Southerly along sa i d
Southeasterly 11ne to the common corner of Lots. 242,. 243, 250 and 251;
thence North 54* 33' West,a-long the division line between Lots 243 and
250, 2143.4 feet to the point of beginning..
Excepting therefrom that portion as described.in-a Final Order of
Condemnation to the City of Petaluma recorded June 11, 1986 under
Document No. eS041912, of Official Records of Sonoma County, and
being more particularly described as fbllowss 4_
PARCEL "H"
A portion of the lands conveyed to Cramer by Deed recorded in Book
2485 of Official Records, page 285, Sonoma County Records, in
Allotment 250, Rowe's Map-of Petaluma Rancho, recorded in Hook 8
of Maps, page 15, and more particularly described as follows:
Beginning at a point on the line between Allotments 243 and 250 as
shown on said map, on the Southeasterly line of Washington Street, 60
feet Wide,, from which corner a found 112 inch iron pipe, untagged,
bears South 54 33' East, 0.23 feet; thence along said line of
Allotments 243 and 250 South 54* 33' East. 2141.59 feet to a set iron
pipe at the most Southerly corner of said lands,, from which corner a
found 1/2 inch iron pipe, untagged, bears North
35a
25' 34" East 5.25
feet; thence along the Southeasterly line of said lands North 35" 25'
34" East 857.45 feet to a set iron pipe; thence North 54* 331 West
2142.75 feet to a set iron pipe on said Southeasterly line of
Washington Street; thence along said line South 35'" 20. 55" West 857.45
feet to the point of beginning.
PARCEL "B -1"
A portion of the lands conveyed to Cramer by Deed recorded in Book
2485 of Official Records, page 285, Sonoma County Records, in
Allotment 250, Rowe's Map of Petaluma Rancho, recorded in Book 9
of Maps, page 15, and more particularly described as follows=
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
Beginning at a get iron pipe on the Strut st- 1 i rW df Wash i ne ton
Street, 60 feet wide, distant along said linfa North 3S® 20' 55" East
657.45 feet from its intersECtion with thw lUm- .AllOtments 243
and 250 as shown on said map; thence al-CM. Said: -MVW, North: 35' 20' S5"
East 500.00 feet to a set iron pipes thavnm:'SWth,- 5r+k .-Mv East 2143.43
feet to a set iron pipe on the Southeasteriy boundary of said lands=
thence along said boundary South 35* 25' 34•" West 500.00 feet to a set
iron pipe; thence North 54® 33' West 2142.75 feet to the point of
beginning.
of
x
r
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
1 EXHIBIT "C"
2 TECHNICAL SPECIFICATIONS FOR THE
3 MAINTENANCE OF COTTONWOOD GOLF COURSE
4 CITY OF PETALUMA, CALIFORNIA
5 Lessee shall utilize these specifications as a minimum. Standards
6 and frequencies may be modified as effected by growing seasons for
7 the proper maintenance of the golf course. Lessee will be expected
8 to maintain the Premises in a good, playable condition at least
9 comparable to other public golf courses in Sonoma County of this
10 type and caliber, with similar fee schedules. As used in this
11 Exhibit "C ", the term "as needed" shall mean at such frequency and
12 in such manner as is necessary to keep the Course (and the
13 particular aspect of the Course which is the subject of any
14 provision hereof) in a good, playable condition at least comparable
15 to other public courses in Sonoma County of this type and caliber,
16 with similar fee schedules.
17 1. Maintain all GREENS observing the following minimum
18 requirements:
19 a. Change cups and repair all ball marks as
20 needed.
21 b. Mow as needed at a height of 3/8" or less and
22 remove clippings.
23 C. Verticut as needed on a year -round basis.
24 d. Aerate a minimum of twice a year.
25 e. Topdress, as needed, following each
26 aerification and verticutting with a soil
27 mixture compatible to the soil structure.
28 Additionally, all greens should be topdressed
29 following over seeding twice a year.
30 f. Treat in a preventative manner for control of
31 insects, disease, weeds and other pests to
32 insure a year round healthy turf that is
33 conducive to the established turf.
34 g. Apply fertilizer as determined by soil test
35 results.
36 2. Maintain all TEES observing the following minimum
37 requirements:
38 a. Move markers and benches as needed.
39 b. Mow as needed at a height of 1/2" or less.
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1 b. Mow as needed at a height of 1/2" or less.
2 C. Aerify at least four times per year.
3 d. Repair worn and damaged turf areas as they
4 occur to insure playable tees at all times.
5 e. Treat in a preventative manner for the control
6 of insects, disease, weeds and other pests to
7 insure a year round turf that is conducive to
8 the established turf.
9 f. Apply fertilizer as determined by soil test
10 results.
11 g. Maintain ball washer with clean water and soap
12 daily. Provide clean tee towels on a daily
13 basis or as dictated by use.
14 3. Maintain all FAIRWAYS and IRRIGATED ROUGHS observing
15 the following minimum requirements:
16 a. Mow FAIRWAYS at least twice per week at 1"
17 height or less.
18 b. Mow IRRIGATED ROUGHS at least once per week at
19 1 -3/4" height or as determined by Lessee.
20 C. Aerify all FAIRWAY as needed and as required
21 by soil conditions.
22 d. Aerify all IRRIGATED ROUGHS as needed and as
23 required by soil conditions.
24 e. Overseed and topdress (or resod) worn or bare
25 areas of FAIRWAYS and IRRIGATED ROUGHS as they
26 occur.
27 f. Treat turf in a preventative manner to control
28 weeds, disease, insects and other pests to
29 insure a year round healthy turf that is
30 conducive to the established turf.
31 g. Apply fertilizer as determined by soil test
32 results.
33 4. Maintain DRIVING RANGE TURF and MISCELLANEOUS
34 LANDSCAPE LAWN areas observing the following minimum requirements:
35 a. Now at least once per week at 1 -1/2" height or
36 less.
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e
1 b. Aerify at least two times per year.
2 C. Overseed and topdress (or re -sod) worn or bare
3 spots in turf as they occur.
4 d. Treat turf in a preventative manner to control
5 weeds, diseases, insects and other pests to
6 insure a year round healthy turf that is
7 conducive to the established turf.
8 e. Apply fertilizer as determined by soil test
9 results.
10 5. Establish and maintain at all times a sod nursery
11 (one each) for greens, tees and fairways.
12 a. Greens.
13 1) Establish nursery green with soil
14 structure and grass species as existing
15 on course.
16 2) Maintain according to greens maintenance
17 specifications.
18 3) Following removal of sod replace soil and
19 re -seed.
20 b. Tees and Fairways.
21 1) Establish tee and fairway nursery with
22 soil structure and grass blend as
23 existing on the course.
24 2) Maintain according to tee and fairway
25 maintenance specifications or as approved
26 by County.
27 3) Following removal of sod replace and re-
28 seed or stolonize.
29 6. Maintain all golf course accessory equipment in
30 clean, safe, functioning conditions at all times, replacing
31 equipment and /or materials as necessary, including but not limited
32 to the following:
33 a. Signs
34 b. Tee benches
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1 C. Tee markers
2 d. Ball washer, including towels and soap
3 e. Out -of- bounds markers
4 f. Distance markers
5 g.
6 h.
7 i.
8 j.
9 k.
10 1.
Greens, flags, and cups (annually)
Green flag poles
Practice green markers and cups (annually)
Trash receptacles
Shoe spike brushes
Sand trap rakes, access and maintenance
11 7. Maintain access and maintenance roadways and their
12 slopes free of brush, weeds and debris at all times.
13 8. Remove all litter daily from golf course grounds and
14 driving range. Remove all trash and debris resulting from golf
15 course maintenance as it occurs. Clean, repair and replace trash
16 receptacles as necessary to maintain clean, safe, and sanitary
17 conditions at all times.
18 9. Maintain the entire irrigation system, including
19 pump station, gate valve assemblies, main lines, electric valves,
20 lateral lines, sprinkler heads, controllers, water supply lines in
21 good repair, functioning as designed by manufacturer and conforming
22 to all related codes and regulations at all times.
23 10. Irrigate all turf and landscape planting as
24 necessary to maintain healthy growth at all times.
25 11. Maintain all shrub, ground cover planting and lawn
26 areas -in a manner to promote proper healthy growth and an
27 aesthetically pleasing appearance and weed free condition at all
28 times.
29 12. Maintain all trees in safe, healthy and
30 aesthetically pleasing condition at all times, keeping adjacent
31 turf mowed and trimmed to the trunks of trees on golf course.
32 13. Sand traps to be raked as needed and kept edged and
33 in weed -free condition at all times, replacing sand and rakes as
34 necessary.
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1 14. Take whatever preventative steps are necessary to
2 protect all slope areas from erosion, fire and rodent damage at all
3 times.
4 15. Control rodent and other animal pests as necessary
5 to prevent erosion, interference with play and destruction of
6 plantings on golf course property at all times.
7 16. Maintain water hazards at proper depth and free of
8 algae and debris.
9 17. Maintain flow lines, swales, sub - surface drainage
10 systems in clear, weed free and proper functioning condition at all
11 times.
12 18. Observe all legal requirements and safety
13 regulations in the use and storage of chemicals, hazardous
14 materials, supplies and equipment at all times.
15 19. Maintain golf maintenance storage building and yard
16 in a clean, orderly and safe condition at all times, conforming to
17 all applicable laws and regulations.
18 20. Protect golfers from injury and the golf course from
19 damage in periods of frost, rainy weather and other unusual
20 conditions at all times.
21 21. Maintain exterior drinking water stations in a
22 clean, sanitary and safe operating condition.
23 22. Maintain bridge abutments and approaches in safe,
24 stable condition at all times.
25 23. Maintain walkways, handrails on walkways, and cart
26 paths in a graded, smooth surface, clean edged, safe and weed free
27 conditions at all times.
28 24. Maintain all fencing, netting and fence lines in
29 safe, Secure and aesthetically pleasing conditions at all times.
30 25. Maintain all roads, parking lots and driveways
31 within said premises in clean, safe and weed free condition at all
32 times with all paved surfaces in good repair.
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AMENDMENT TO LEASE AGREEMENT
THIS rNDMEEI T, TO LEASE AGREEMENT ( "Amendment ") is made and entered
into as of this - f0- 1994 by and between THE CITY OF PET.ALUMA, a
public body, corporate and politic of the State of California ( "Lessor "), and COTTONWOOD
GOLF CLUB, INC., a California corporation ( "Lessee ").
RECITALS:
A. Lessor and a certain third parry not party hereto, namely Empire Golf; Inc., a
California corporation ( "Empire "), have entered into that certain Lease Agreement dated January
7, 1991 (the "Lease ") concerning approximately 126 acres located on or near the Petaluma
Municipal Airport, Sonoma County, California and therein described as the "Leased Premises ".
B. Empire has assigned its interest in the Lease to Lessee and Lessor has approved
said assignment.
C. Lessor and Lessee wish to amend the terms of the Lease in the manner herein set
forth.
ACCORDINGLY, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, Lessor and Lessee hereby agree to amend the Lease as follows:
1. STATUS OF LEASE: The Lease is in full force and effect and, except for this
Amendment, has not been modified or amended. Upon execution of this Amendment, there is no
default by Empire or Lessee under the Lease and Lessor has no claims, demands or offsets against
Empire or Lessee.
2. LESSOR'S REQUIRED OBLIGATIONS: In order to implement the Landlord's
Required Obligations to subordinate the Leased Premises (and the 33 Acre Parcel described in
Paragraph 4, below, when applicable) to allow financing of the project by Lessee in the manner
described in Paragraph_ 6.1(c) of the Lease, as amended herein, Lessor hereby appoints and
empowers the City Manager to meet and confer with Lessee within six (6) months of the date of
this Amendment to agree, subject to City Council approval, upon reasonable and express terms
and conditions for Lessee's senior financing. At such time as the City Manager and Lessee agree
upon, and City Council approves, said terms, the Lease shall be further amended by the City
E r -1 2 Eel
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Manager and Lessee, subject to City Council approval, to incorporate formally the express
subordination terms into the Lease.
Paragraph 6.1(c) of the Lease is deleted in its entirety and is amended to read as follows:
6.1(c) Subordination of ground lease to allow for financing of project.
3. CONSTRUCTION: The Required Construction described in Paragraph 6.5 of the
Lease shall be undertaken by a licensed California general contractor selected by and under
contract with Lessee.
4. ADDITIONAL RENT: If and when Lessor and Lessee determine that
commencement of construction of the golf course facility is feasible, Lessee agrees that, as and for
consideration for the extension of the Construction Date described in Paragraph 7, below, Lessee
shall then become obligated to make a one -time rent payment (the "Additional Rent Payment ") to
Lessor in the form of conveyance to Lessor of the 33 Acre Parcel (herein so called and as more
particularly described in Exhibit B to the Lease). For purposes of determining Lessee's obligation
to make the Additional Rent Payment, Lessor and Lessee agree that commencement of
construction of the golf course facility shall be deemed feasible when Lessee is ready to
commence construction of the golf course facility in the manner described in the Lease as
evidenced by (i) Lessor's performance of Lessor's Required Obligations described in Paragraph
6.1 of the Lease, (ii) Lessee's acquisition of title to the 33 Acre Parcel from third parties not party
hereto, (iii) Lessor's approval of plans for the golf course facility in the manner described in
Paragraph 6.4 of the Lease, and (iv) Lessor's acceptance of Lessee's assurances for completion in
the manner described in Paragraph 6.6 of the Lease. If the commencement of golf course
construction is not feasible, Tenant shall not be obligated to make the Additional Rent Payment.
If the commencement of golf course construction is feasible, Lessee must make the Additional
Rent Payment no later than the date of opening of public play on the golf course project (the
Payment Date "). Lessee may, but shall not be obligated to, pay the Additional Rent Payment
prior to the Payment Date. If golf course construction is feasible and if Lessee does not pay the
Additional Rent Payment by the Payment Date, Lessee shall be in default hereunder and Lessor
may terminate the Lease. The payment of the Additional Rent Payment shall not reduce or be a
credit against Lessee's other rental .obligations described in Paragraph 7 of the Lease.
If commencement of the golf course facility is feasible, Lessee shall convey the 33
Acre Parcel to Lessor on or prior to the Payment Date in its then existing state and condition.
Lessor shall accept title to the 33 Acre Parcel free and clear of mortgages and/or deeds of trust
securing monetary obligations of Lessee (other than Lessee's financing described in Paragraph
6.1(c) of the Lease and Paragraph 2, above) but subject to any and all other non - monetary
encumbrances that do not have a material adverse effect on the conduct of golf course operations
or which may otherwise be approved by Lessor.
5. EMINENT DOMAIN: Paragraph 19 of the Lease is hereby amended to provide
that in the event that title to any portion of the Leased Premises or the 33 Acre Parcel are taken
by condemnation or by right of eminent domain and in the event that Lessee cannot reasonably
conduct golf course operations on the untaken portion of the Leased Premises, the Lease shall
FA
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terminate effective as of the earlier date title or possession to the taken portion is obtained by the
condemnins authority.
6. ASSIGVYIENT: Lessor agrees that for purposes of Paragraph 21 of the Lease,
Lessor's consent shall not be required for any transfer of the stock or assets of Lessee; or any
transfer of the Lease to a partnership; or any transfer of an undivided interest in the Leased
Premises; so long as in each case Richard A Coombs, Borue H. O'Brien and Lang L. Wasem
shall own, either collectively or individually, at least fifteen percent (15 %) of the voting stock of
Lessee or of any partnership or other ownership arrangement for the Leased Premises and shall
retain control of the operations of the project. Any transfer described in this Paragraph 6 shall not
constitute an assignment or other transfer of Lessee's interest in the Lease.
7. EXTENSION OF CONSTRUCTION DATE: In consideration of the ?additional
Rent Payment, Lessor and Lessee hereby agree to delete Paragraph 22.1(d) of the Lease in its
entirety. Lessor and Lessee agree that in the event Lessee does not commence substantial
construction of the golf course project described in the Lease by October 30, 1996 (the
Construction Date "), Lessor, at its option, may terminate the Lease effective upon delivery of
written notice to Lessee delivered to Lessee at any time after the Construction Date but prior to
the time Lessee may actually commence substantial construction of the golf course. Lessor and
Lessee agree that the Construction Date may be postponed and extended for Unavoidable Delay.
As used herein, the term "Unavoidable Delay" shall mean delays due to strikes, acts of God,
unusual or unreasonable weather conditions, act or delay to act on the part of any public or
governmental entity (other than . Lessor), litigation or similar cause or other causes beyond the
reasonable control of Lessee.
8. CAPITALIZED TERMS: All capitalized terms and phrases used in this
Amendment shall be given the same meaning ascribed to that term or phrase in the Lease except
as otherwise provided in this Amendment.
9. NOTICES: ADDRESSES: For purposes of Paragraph 23 of the Lease, notices,
demands, requests or replies to Lessee shall be delivered to Lessee at the following address:
Cottonwood Golf Club, Inc.
414 Aviation Boulevard
Santa Rosa, CA 95403 -1069
Attn: Richard A. Coombs
Larry L. Wasem
10. RECORDING: Neither the Lease nor this Amendment shall be recorded;
provided, however, a memorandum of the Lease and this Amendment in a form reasonably
acceptable to the City Manager and Tenant may be recorded by either party in the Official
Records of Sonoma County.
11. CONFLICTS: In the event of any conflict between the terms of the Lease and the
terms of this Amendment, the terms of this Amendment shall govern and prevail.
3
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12. COUNTERPARTS: This Amendment may be executed in identical counterparts
and each counterpart together shall constitute a single integrated document.
IN WITNESS WHEREOF, the parties hereto have set their hand, effective as of the day
and year first above written.
LESSOR: C= OF PETA.LUMA,
LESSEE:
winwordlagrmt.doc
10/5194 (fmk)
a
ATTEST:
City C
Financ ff cerlAoitor
Ris Manager
COTTONWOOD GOLF CLUB, INC., a
California corporation
By:
Name: Richard A. Coombs
Its: C
4
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SECOND AMENDMENT TO LEASE AGREEMENT
THIS SECOND AMENDMENT TO LEASE AGREEMENT ( "Second
Amendment "), is made and entered into as of this -Ty day of
1996 (the "Effective Date ") by and between THE CITY
OF PETALUMA, a public body, corporate and politic of the State of
California ( "Lessor "), and COTTONWOOD GOLF CLUB, INC., a
California corporation ( "Lessee ").
R E C I T A L S•
A. Lessor and a certain third party not party hereto,
namely Empire Golf, Inc., a California corporation ( "Empire "),
have entered into that certain Lease Agreement dated January 7,
1991 (the "Lease ") concerning approximately 126 acres located on
or near the Petaluma Municipal Airport, Sonoma County, California
and therein described as the "Leased Premises ".
B. Empire has assigned its interest in the Lease to
Lessee and Lessor has approved said assignment.
C. Lessor and Lessee have amended the Lease pursuant
to the terms of that certain Amendment to Lease Agreement dated
December 8, 1994 (the "First Amendment ").
D. Lessor and Lessee wish to amend further the terms
of the Lease and the First Amendment in the manner herein set
forth.
ACCORDINGLY, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, Lessor
and Lessee hereby agree to amend the Lease and the First
Amendment as follows:
1. STATUS OF LEASE: Lessor and Lessee agree and
acknowledge that the Lease and First Amendment are in full force
and effect and, except for this Second Amendment, have not been
otherwise modified or amended.
2. REDESIGNATION OF LEASED PREMISES: Upon
satisfaction of the conditions precedent described in Paragraph
3, below, the description of the Leased Premises shall be revised
to include that certain real property (the "Additional Premises ")
currently leased to a third party not party hereto, namely
Redwood Empire Sports Associates, Inc. ( "RESA") pursuant to the
terms of that certain Lease Agreement between Lessor and RESA
dated June 21, 1994 (the "RESA Lease ") in the following manner:
The "Leased Premises" for purposes of the Lease shall include all
that real property shown as Golf Course Parcel North and Golf
COORW284. - -...
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Course Parcel South, described on Exhibit "A" and Exhibit "B ",
attached hereto and incorporated herein (which includes therein
the Additional Premises). The real property to be covered by the
RESA Lease shall include all that real property described on
Exhibit "C ", attached hereto and incorporated herein (which
includes a portion of The 33 Acre Parcel described in the Lease
and First Amendment). Upon redesignation of the premises covered
by the Lease and the RESA Lease, the City shall also reserve a
non - exclusive access easement over the redesignated Leased
Premises, more particularly described in Exhibit "D ", attached
hereto and incorporated herein.
3. CONDITIONS PRECEDENT TO REDESIGNATION OF LEASED
PREMISES: The redesignation of the Leased Premises shall become
effective upon the occurrence of the following events within one
hundred eighty (180) days of the Effective Date:
i) An amendment of the RESA Lease to release the
Additional Premises from the RESA Lease for
purposes of including the Additional Premises
within the Leased Premises hereunder. Said
release shall be evidenced by a binding and
unconditional written amendment to the RESA
Lease redefining the Premises covered thereby
to include only the property described on
Exhibit "C" hereto, and a quitclaim deed
executed by RESA remising to Lessor all of
RESA's right, title and interest to the
Additional Premises.
Lessee obtaining all needed approvals for the
modification of Conditional Use Permit No.
CUP91022, EIQ91004 (the "CUP ") for the golf
course project described in the Lease to
include and apply to the Leased Premises as
redesignated to include the Additional
Premises.
The conditions precedent to the redesignation of the Leased
Premises are for the mutual benefit of both Lessor and Lessee and
may be waived only by both parties in writing. Lessor agrees to
exercise reasonable efforts to obtain RESA's consent to the
redesignation of the Leased Premises at no cost to Lessee.
Within thirty (30) days after the Effective Date, Lessee agrees
to apply for a CUP modification consistent with the terms hereof
at Lessee's sole cost and expense. Upon timely satisfaction of
the conditions precedent described in this Paragraph 3, the Lease
shall be deemed to be amended to include the Additional Premises
without further notice or documentation. Lessor agrees that the
Additional Premises shall be in its current physical state and
condition and free and clear of all liens, encumbrances and
COOR \332&4
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mortgages except for easements of record which do not materially
affect the suitability of the Additional Premises for its
intended purpose.
4. EXTENSION OF CONSTRUCTION DATE: Lessor and Lessee
hereby agree to amend Paragraph 7 of the First Amendment as
follows:
i) If the conditions precedent described in
Paragraph 3, above, are satisfied in a timely
manner, the "Construction Date" (as defined in
Paragraph 7 of the First Amendment) shall mean
a date two (2) years from the date the
conditions precedent are both satisfied.
If the conditions precedent described in
Paragraph 3, above, are not satisfied, the
Construction Date" shall mean a date one (1)
year after the date it is finally determined
by the Lessor that the conditions precedent
described in Paragraph 3, above, will not be
satisfied.
5. FEES AND CHARGES: Paragraphs 9.1, 9.2 and 9.3 of
the Lease are modified as follows: Fees for golf for non-
residents of the City of Petaluma shall be determined solely by
Lessee. All residents of the City of Petaluma shall be entitled
to a twenty percent (20 %) discount off the lower of: (i) the fees
actually charged by Lessee to non - residents of the City of
Petaluma; or (ii) the average regular 18 hole weekday and regular
18 hole weekend green fees' for the five (5) golf courses
described in Paragraph 9.1 of the Lease determined in the manner
described in Paragraph 9.1 of the Lease (the "Comparison Fees ").
All Seniors and Juniors who are residents of the City of Petaluma
shall be entitled to a thirty percent (30 %) discount off the
lesser of: (i) the fees actually charged by Lessee to non-
residents of the City of Petaluma; or (ii) the Comparison Fees.
6. CAPITALIZED TERMS: All capitalized terms and
phrases used in this Second Amendment shall be given the same
meaning ascribed to that term or phrase in the Lease and First
Amendment except as otherwise provided in this Second Amendment.
7. RECORDING: Neither the Lease,
nor this Second Amendment shall be recorded;
memorandum of the Lease and the First Amendm
Amendment in a form reasonably acceptable to
Lessee may be recorded at any time by either
Official Records of Sonoma County.
COOR \33284
83047.3 -3-
the First Amendment
provided, however, a
ant and this Second
the City Manager and
party in the
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8. CONFLICTS: In the event of any conflict between
the terms of the Lease and the First Amendment on one hand and
the terms of this Second Amendment on the other hand, the terms
of this Second Amendment shall govern and prevail.
9. COUNTERPARTS: This Second Amendment may be
executed in identical counterparts and each counterpart together
shall constitute a single integrated document.
IN WITNESS WHEREOF, the parties hereto have set their
hand, effective as of the Effective Date.
LESSOR: CITY OF PET
By:
Citv/ Manacter
ATTE
City Clerk
APPROVED AS TO FORM:
7
City Attorney
Finance Officer /A
RisX Mana
LESSEE: COTTONWOOD GOLF CLUB, INC., a
California corporation
By:
NamigT ichard A. -Coombs
Its: i
COOR \33284
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EXHIBIT A
GOLF COURSE PARCEL -NORTH
ALL THAT REAL PROPERTY SITUATED IN THE COUNTY OF SONOMA, STATE OF
CALIFORNIA, BEING A PORTION OF THE LANDS OF THE CITY OF PETALUMA,
A CHARTER CITY AND MUNICIPAL CORPORATION, AS DESCRIBED BY THAT
DEED RECORDED AS DOCUMENT NUMBER 86- 109033, OFFICIAL RECORDS OF
SONOMA COUNTY, DESCRIBED AS FOLLOWS:
BEGINNING AT THE MOST SOUTHERLY CORNER OF SAID LANDS OF PETALUMA,
ALSO BEING THE NORTHWESTERLY LINE OF WASHINGTON STREET, THENCE,
ALONG THE SOUTHWESTERLY LINE OF SAID LANDS, NORTH 54 033'00" WEST,
234..00 FEET; THENCE, LEAVING SAID SOUTHWESTERLY LINE, NORTH
35 026'58" EAST, 62.00 FEET; THENCE NORTH 74 °47100" EAST, 87.00
FEET; THENCE NORTH 09 007100" EAST, 144.00 FEET; THENCE NORTH
34 031'57" EAST, 40.55 FEET; THENCE NORTH 54 032131" WEST, 118.65
FEET; THENCE NORTH 35 027'24" EAST, 243.00 FEET; THENCE NORTH
54 033'00" WEST, 1330.73 FEET; THENCE SOUTH 64 012153" WEST, 313.81
FEET; THENCE SOUTH 35 038'06" WEST, 266.83 FEET TO SAID
SOUTHWESTERLY LINE OF SAID LANDS OF PETALUMA; THENCE, ALONG SAID
SOUTHWESTERLY LINE, NORTH 54 033'00" WEST, 1054.61 FEET TO THE
MOST WESTERLY CORNER OF SAID LANDS; THENCE, ALONG THE
NORTHWESTERLY LINE OF SAID LANDS, NORTH 35 030'00" EAST, 1502.47
FEET TO THE MOST NORTHERLY CORNER OF SAID LANDS; THENCE, ALONG
THE NORTHEASTERLY LINE OF SAID LANDS, SOUTH 54 °33'00" EAST,
2899.22 FEET TO SAID NORTHWESTERLY LINE OF WASHINGTON STREET;
THENCE, ALONG SAID NORTHWESTERLY LINE, SOUTH 35 030'00" WEST,
1502.47 FEET TO THE POINT OF BEGINNING.
CONTAINING 81.05 ACRES FEET MORE OR LESS.
PREPARED BY: BRELJE & RACE CONSULTING CIVIL ENGINEERS
APN: 136- 070 -022 DATE: FEBRUARY 22,1996
JOB: 1967
11r?s:
El
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rti
EXHIBIT C
BALLFIELD PARCEL - SOUTH
ALL THAT REAL PROPERTY SITUATED IN THE COUNTY OF SONOMA, STATE OF
CALIFORNIA, BEING A PORTION OF THE LANDS OF GLEN A. CRAMMER, AS
DESCRIBED BY THAT DEED RECORDED IN BOOK 2485, AT PAGE 285,
OFFICIAL RECORDS OF SONOMA COUNTY, DESCRIBED AS FOLLOWS:
BEGINNING ON THE NORTHWESTERLY LINE OF SAID LANDS OF CRAMER, FROM
WHICH THE NORTHERLY CORNER COMMON TO CRAMER PARCEL "B -1" AND
CRAMER PARCEL "B" AS SHOWN ON THAT RECORD OF SURVEY FILED IN BOOK
377 AT PAGES 21 & 22, SONOMA COUNTY RECORDS BEARS
SOUTH 35 020'55" WEST 822.15 FEET, THENCE, LEAVING SAID
NORTHWESTERLY LINE, SOUTH 16 036'16" EAST 292.06 FEET; THENCE
SOUTH 60 008'17" EAST 611.99 FEET; THENCE SOUTH 38 017123" EAST
500.00 FEET; THENCE SOUTH 63 046108" EAST 582.05 FEET; THENCE
SOUTH 76 022'31" EAST 269.26 FEET TO THE SOUTHEASTERLY LINE OF
SAID LANDS OF CRAMER; THENCE, ALONG SAID SOUTHEASTERLY LINE,
NORTH 35 025'34" EAST 406.65 FEET TO THE MOST EASTERLY CORNER OF
SAID LANDS; THENCE, ALONG THE NORTHEASTERLY LINE OF SAID LANDS,
NORTH 54 033'00" WEST 2144.32 FEET TO THE MOST NORTHERLY CORNER
OF SAID LANDS, ALSO BEING THE SOUTHEASTERLY LINE OF WASHINGTON
STREET; THENCE, ALONG SAID SOUTHEASTERLY LINE,
SOUTH 35 020'55" WEST 340.00 FEET TO THE POINT OF BEGINNING.
CONTAINING 24.88 ACRES MORE OR LESS.
PREPARED BY: BRELJE & RACE CONSULTING CIVIL ENGINEERS
APN: 136- 070 -019 DATE: 1 -10 -96
JOB: 1967
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
EXHIBIT E
BALLFIELD PARCEL - NORTH
ALL THAT REAL PROPERTY SITUATED IN THE COUNTY OF SONOMA, STATE OF
CALIFORNIA, BEING A PORTION OF THE LANDS OF THE CITY OF PETALUMA,
A CHARTER CITY AND MUNICIPAL CORPORATION, AS DESCRIBED BY THAT
DEED RECORDED AS DOCUMENT NUMBER 86- 109033, OFFICIAL RECORDS OF
SONOMA COUNTY, DESCRIBED AS FOLLOWS:
COMMENCING AT THE MOST SOUTHERLY CORNER OF SAID LANDS OF
PETALUMA, ALSO BEING THE NORTHWESTERLY LINE OF WASHINGTON STREET,
THENCE, ALONG THE SOUTHWESTERLY LINE OF SAID LANDS, NORTH
54 033'00" WEST, 234.00 FEET TO THE POINT OF BEGINNING; THENCE,
LEAVING SAID SOUTHWESTERLY LINE, NORTH 35 026158" EAST, 62.00
FEET; THENCE NORTH 74 °47100" EAST, 87.00 FEET; THENCE NORTH
09 007'00" EAST, 144.00 FEET; THENCE NORTH 34 031157" EAST, 40.55
FEET; THENCE NORTH 54 032'31" WEST, 118.65 FEET; THENCE NORTH
35 027'24" EAST, 243.00 FEET; THENCE NORTH 54 033100" WEST, 1330.73
FEET; THENCE SOUTH 64 012153" WEST, 313.81 FEET; THENCE SOUTH
35 038106" WEST, 266.83 FEET TO SAID SOUTHWESTERLY LINE OF SAID
LANDS OF PETALUMA; THENCE, ALONG SAID SOUTHWESTERLY LINE,
SOUTH 54 033'00" EAST, 1844.61 FEET;
TO THE POINT OF BEGINNING.
CONTAINING 18.94 ACRES MORE OR LESS
PREPARED BY: BRELJE & RACE CONSULTING CIVIL ENGINEERS
APN: 136 - 070 -022 DATE: FEBRUARY 22,1996
JOB: 1967
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
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DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
t
LENDER'S AGREEMENT
AND THIRD AMENDMENT TO LEASE AGREEMENT
This Lender's Agreement and Third Amendment to Lease Agreement is made and entered
11 -Nintothis day of )
wV0 ' ",. 997, by and between the City of Petaluma, a California municipal
corporation ( "LESSOR "), Rooster Run Golf Club, a California Limited Partnership, ( "LESSEE "),
and Exchange Bank, a California corporation, ( "LENDER ")
RECITALS
A. LESSOR and a certain third party, not a party hereto, named Empire Golf, Inc., a
California corporation ( "EMPIRE "), have entered into that certain Lease Agreement dated January
7, 1991, (the "LEASE ") concerning approximately 126 acres located on or near the Petaluma
Municipal Airport, Sonoma County, California and therein described as the "Leased Premises."
B. EMPIRE assigned its interest in the LEASE to Cottonwood Golf Club, Inc.
COTTONWOOD ") and LESSOR has approved said assignment.
C. LESSOR and COTTONWOOD have amended the LEASE pursuant to the terms of
that certain Amendment to Lease Agreement dated December 8, 1994, (the "FIRST
AMENDMENT ")
D. LESSOR and COTTONWOOD have again amended the Lease Agreement pursuant
to the terms of that certain Second Amendment to Lease Agreement dated June 5, 1996, (the
SECOND AMENDMENT ") pursuant to which the Leased Premises were redemised to cover the
real property described in Exhibit "A" attached hereto and incorporated herein.
E. COTTONWOOD has assigned its interest in the Lease to LESSEE pursuant to the
terms of the Lease and Amendments.
F. LESSEE has mortgaged its interest in the LEASE to LENDER pursuant to that
certain Deed ofTrust and Assignment ofRents dated September 17, 1997, and recorded October 10,
1997, as Document No. 97- 92917, Sonoma County Records.
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
i
G. LESSOR, LESSEE, and LENDER wish to amend further the terms of the LEASE,
the FIRST AMENDMENT and the SECOND AMENDMENT in the manner herein set forth.
AGREEMENT
1. Amendment of Lease. The LEASE is hereby amended as hereinafter set forth.
2. Grant of Avipation Rights to Lessor. LESSEE does hereby grant to Lessor, its
successors and assigns, for the term of the Lease an assignable easement over the Leased Premises,
lying beneath the Airspace, as described in Paragraph 2.1 for the Petaluma Municipal Airport.
2.1 Description of Airspace:
The "Airspace" described in this Paragraph 2 shall consist of the following:
2.1.1. Approach Zones (Inner and Outer Approaches):
The imaginary plane above the Leased Premises as such plane is defined by Part 77
ofthe Federal Aviation Regulations consisting of a trapezoidal plane inclined at the rate ofone foot
vertically for each twenty feet horizontally (20:1), the elevation of which plane is based upon the
Petaluma Municipal Airport official runway end elevation for Runway 11 of 87 feet Above Mean
Sea Level (AMSL), as determined by the official Airport Layout Plan on file with the City of
Petaluma. The approach zone is defined as a trapezoidal plane centered on the extended runway
centerline at a point located 200 feet beyond the official runway end and encompasses the runway
protection zone (formerly known as the clear zones), the inner and outer approach zones. The
approximate dimensions of the approach zones are depicted on Exhibit B attached hereto and
incorporated by reference herein (The "Airport Map ").
2.1.2 Transition Area:
The imaginary plane above the Leased Premises as such plane is defined by Part 77 of the
Federal Aviation Regulation's consisting of a plane beginning at 250' setback from the runway
centerline and inclined at the rate of one foot vertically for each seven feet horizontally (7:1), the
elevation of the said plane is based upon the Petaluma Municipal Airport official runway end
elevation of 87 feet Above Mean Sea Level (AMSL), as determined by the approximate dimensions
of which said plane are described and shown on the Airport Map.
2
INITIAL
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
2.1.3 Horizontal Zone:
The imaginary plane above portions ofthe Leased Premises as such plane is defined by Part
77 of the Federal Aviation Regulations consisting of a horizontal plane situated 150 feet above the
Petaluma Municipal Airport's elevation (87') more clearly defined as 237' Above Mean Sea Level,
as shown on the Airport Map.
2.2 Description of Lessor's Easement Rights:
Lessor's easement and right -of -way under this Paragraph 2 include but are not limited to the
following uses:
1) For the uses and benefit of the public, the easement and continuing right to fly, .or
cause or permit the flight by any and all persons, or any and all kinds now or hereafter known, in,
through, across or about any portion of the Airspace;
2) The easement and right to cause or caused or create or permit to allow to be caused
or created within all space above the existing surface of the Leased Premises and any and all
Airspace laterally adjacent to the Leased Premises, such noise, fumes, emission, vibration, currents
and other effects of air, illumination and fuel consumption as may be inherent in, or may arise or
occur from or during the operation of aircraft of any and all kinds, now or hereafter known or used,
for navigation of or flight in air;
3) A continuing right to clear, and keep clear the Airspace of any portions ofbuildings,
structures, or improvements of any kinds, and of trees or other obj ects, including the right to remove,
or demolish those portions of such buildings, structures, improvements, trees or other things which
extend into or above said Airspace, and the right to cut to the ground level and remove, any trees
which extend into or above the Airspace, and the right to remove, prevent or restrict sources of
excessive smoke, glare or electronic interference that may become a hazard to air navigation.
4) The right to mark and light, or cause or require to be marked or lighted, as
obstructions to air navigation, any and all buildings, structures, or other improvements, and trees or
other objects, which extend into or above the Airspace;
5) The right to ingress to, passage within and egress from the Leased Premises upon
notice to LESSEE, for the purposes described in Paragraphs 2.2, (3) and (4) above; and
3
9 XINITIAL,/
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
6) The right to prevent, restrict or limit the type, density and /or intensity of use of that
portion of the airspace located within the inner approach zone(s) as depicted on The Airport Map
to meet the Airport Compatibility Criteria defined by the City ofPetaluma and the Sonoma County
Airport Land Use Commission.
2.3 LESSEE Obli atg_ ions:
LESSEE hereby covenants with the Lessor, for the direct benefit of the real property
constituting the Petaluma Municipal Airport, that LESSEE will not construct, install, erect, place
or go in or upon the leased Premises, nor will LESSEE permit to allow, any building structure,
improvement, tree or other object which extends into or above the Airspace, or which constitutes an
obstruction to air navigation or which obstructs or interferes with the use ofthe easement and rights -
of -way herein granted by this in Paragraph 2.
The easements and rights -of -way herein granted shall be deemed both appurtenant to and for
the direct benefit of that real property which constitutes the Petaluma Municipal Airport, in the
County of Sonoma, State of California; and shall further be deemed in gross, being conveyed to
Lessor for the benefit of the Lessor for the term ofthe Lease and any and all members of the general
public who may use said easement of right -of -way, in landing at, taking off from or operating such
aircraft in or about the said Petaluma Municipal Airport, or in otherwise flying through the Airspace.
The grant of easement and right -of -way to Lessor under this Paragraph 2 shall not operate
to deprive LESSEE, its successor or assigns, of any rights which it may from time to time have
against any private operator for negligent or unlawful operation of aircraft.
Creek Restoration and Path Maintenance By Lessee:
LESSEE shall be responsible for maintenance of the restored portions ofthe natural channels
within the referenced Leased Premises in accordance with a Management Plan to be prepared by
LESSEE as referenced in Condition 17 ofthe CUP 96201 and approved by Administrative SPARC
Review. LESSEE shall also be responsible for maintenance of all paths installed by LESSEE on the
Leased Premises in satisfaction of Condition 46 of the CUP 96201.
4. Assimnent of Leasehold. The terms of this paragraph 4 and Paragraphs 5 and 6
below, shall apply and remain in effect at all times that the interest of LESSEE and in the LEASE
is hypothecated or otherwise encumbered to (i) LENDER as security for an indebtedness or
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
leasehold mortgage of LESSEE to LENDER or (ii) to any other leasehold mortgagee.
Notwithstanding any present or future leasehold mortgage, LESSOR and LESSEE agree that
LESSEE has retained and continues to possess the rights set forth in Paragraph 2 of the FIRST
AMENDMENT and that at any time, and from time to time, said provisions of the FIRST
AMENDMENT shall apply as between LESSOR and LESSEE commencing and effective upon
delivery of written notice by LESSEE to LESSOR.
a) LESSEE, as security for any indebtedness to LENDER, or as specified in this
paragraph 4 above, may encumber by a Deed of Trust or other proper instrument ( "Instrument ") the
leasehold interest of LESSEE under the Lease, together with LESSEE'S right to the use and
occupancy of all improvements now and hereafter placed upon the Premises. Any such
encumbrances shall, however, require the prior written consent of Lessor, which consent will not be
unreasonably withheld. The execution of said Instrument, or the foreclosure thereof or sale
thereunder, either by judicial proceeding or through any power reserved therein or conveyance by
LESSEE to LENDER, or the exercise of any right, power or privilege reserved therein, shall not be
held as a violation of any of the terms or conditions of the Lease.
b) Said Instrument shall be subject to and shall expressly assume all the terms,
covenants and conditions ofthe Lease and shall not be construed as creating any right in or lien upon
the land covered by the Lease insofar as LESSOR'S ownership thereof is concerned, or insofar as
it may concern the right, title, and interest of any party claiming by, through, or under LESSOR,
other than LESSEE.
c) In the event that LESSEE shall fail to pay any installment of rent reserved
under the Lease, or fail to pay any imposition or to make any other payment required to be paid
under the Lease, or if LESSEE shall fail to perform or observe any other term, covenant, condition
or obligation required to be performed or observed under the Lease, then, without waiving or
releasing LESSEE from any oftheir obligations, LENDER shall have the right, but shall be under
no obligation, to pay any and installment ofrent and /or any tax, assessment, levy, charge, imposition
or other payment, and may perform any other act or take such action as may be appropriate to cause
such term, covenant, condition or obligation to be promptly performed or observed on behalf of
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
LESSEE, to the end that LESSEE'S rights under the Lease, shall be kept unimpaired and free from
default, and the obligations due LESSOR shall be deemed satisfied.
d) If LENDER shall make any payment or perform any acts or take any action in
accordance with the preceding subsection (c), LENDER will give to LESSEE 15 days written notice
of the intent to make any such payment of, the performance of any such act or the taking of any such
action, but failure to give any such notice will not otherwise affect the rights of LENDER hereunder.
In any such event, LENDER, on curing any such default, shall be immediately ' entitled to
reimbursement for all sums so paid from the party on whose behalf said payment was made, together
with reasonable attorneys' fees and costs. .
e) In the event LENDER shall succeed to LESSEE'S interest in the Lease, LENDER
shall assume all contractual obligations as LESSEE under the Lease (including, but not limited to,
the obligation to make rental payments) except that, LESSOR (i) shall not require LENDER to
commence use ofthe Premises until after one hundred and eighty (180) days from the date LENDER
acquires title to LESSEE'S leasehold interest and (ii) subject to paragraph (g), LESSOR shall give
LENDER the right to assign the Lease or further let the Premises for the purposes specified in the
Lease, with LESSOR'S prior written consent, which consent will not be unreasonablywithheld. Any
person taking title to the leasehold interest shall be required to expressly assume all contractual
obligations under the Lease (including, but not limited to, the obligation to make rental payments)
in the same manner and the same extent had LENDER succeeded to the interest of the LESSEE.
The foregoing notwithstanding, LESSOR may, during said 180 day period, by giving
Lender 30 days prior written notice, assume the obligations of the Lessee under the Lease and
operate the Leased Premises as a golf course for the balance of said 180 days.
f) Neither the occurrence of any event mentioned in this Section 4, nor the
acceptance of rent by LESSOR from LENDER or any person, nor the curing of any default under
the Lease shall release LESSEE from liability under the Lease, except for the default thereby cured.
g) Prior to any sale ofits interest in the Lease and resultant assignment pursuant
to subparagraph (e)(ii) above, LENDER shall give LESSOR written notice of its desire to affect such
transaction prior to discussing any such transaction with any other person. LESSOR shall have the
option, exercisable at any time within 60 days after the giving of the written notice provided for by
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
this Section (g) to negotiate such a transaction with LENDER on the terms and conditions as
specified in LENDER'S notice to LESSOR. The option provided for in this subparagraph (g) may
be exercisedby the giving ofwritten notice to LENDER by LESSOR ifit is exercised during the 60
day period and ifnot so exercised, it shall expire. Once notice is given by LESSOR, any acquisition
by LESSOR shall be completed within the negotiation period, unless extended by all parties.
If LESSOR does not exercise the option provided for by this subparagraph (g), or
fails to consummate a transaction after exercising the option, LENDER may negotiate with any
person, provided the negotiation involves a transaction on substantially the same terms as those set
forth in the notice by LENDER to LESSOR.
5. Termination; Rights of Lender and Lessee and
Successors.
a) Notwithstanding anything contained herein in the
Lease to the contrary, LESSOR may terminate the Lease only because of a default thereunder and,
further, only i£
i) such default is a failure to pay (after the expiration of any
applicable grace periods) any funds due to LESSOR under the Lease and LENDER
fails to cure such default within thirty (30) days after their receipt of written notice
of such default from LESSOR; or
ii) in the event the cure of any other default under the Lease
susceptible of being cured by LENDER is not commenced within thirty (30) days
after receipt of written notice of such default and LENDER fails to carry the same
to completion with all reasonable dispatch. If such default cannot be cured without
obtaining possession of the Premises (through a receiver or otherwise) or title to the
leasehold estate, if LENDER commences and thereafter pursues to completion
proceedings to obtain possession of the Premises (through a receiver or otherwise)
and/or to foreclose the lien or diligently proceed to obtain possession of and/or title
to the leasehold estate by deed in lieu of foreclosure or otherwise, such shall be
deemed to satisfy the above cure requirements so long as LENDER, within 30 days
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
after obtaining possession or title, commences the work of curing such default and
carries the same to completion with all reasonable dispatch; or
iii) in the event of a default under the Lease which is not susceptible
of being cured by LENDER, such default shall be deemed to be cured if (A) within
30 days after receiving written notice from LESSOR setting forth the nature of such
default, LENDER shall have commenced foreclosure or other appropriate
proceedings to obtain possession of the Premises (through a receiver or otherwise)
and shall thereafter diligently prosecute such proceedings to completion, or (B).
LENDER commences, within such 30 days, and thereafter diligently proceeds to
completion, proceedings to obtain title to the leasehold estate by foreclosure or deed
in lieu of foreclosure or otherwise.
b) So long as LENDER is proceeding diligently to fully satisfy the provisions of
Section 5(a)(ii) or 5(a)(iii) (provided that in no event shall the taking of such actions exceed 180
days), LESSOR'S right to terminate the Lease shall be suspended.
c) Notwithstanding anything herein contained to the contrary, no cure period granted
hereunder shall commence until any and all concurrent grace periods granted to LESSEE under the
Lease shall have expired for the remedying of such default or for causing it to be remedied.
d) Notwithstanding anything herein contained to the contrary, LENDER shall not
be obligated to continue any actions for possession of the Premises or to continue any foreclosure
proceedings after any defaults under the Lease shall have been cured.
e) LESSOR agrees that ifLESSEE for any reason shall fail within the time limit in
the Lease, or shall not be entitled, to exercise its right to renew the Lease for any renewal term as
therein provided, or shall fail to properly exercise any of its remaining extension options, LESSOR
shall notify LENDER in writing that LESSEE has failed as aforesaid, or is not entitled, to exercise
its right to renew the Lease, as the case may be, and LENDER shall have the right for a period of
thirty (30) days after the receipt of such notice to elect that the Lease be renewed for such renewal
term upon the same terms and conditions and with the same effect as though such right had been
exercised by LESSEE as set forth in the Lease.
r,
INITIAL
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
f) LESSOR shall notify LENDER promptly of: (i) the occurrence of any default
by LESSEE under the Lease, or the occurrence of any event which, with the passage of time or
service ofnotice or both, would constitute a default by LESSEE under the Lease; and (ii) the receipt
by LESSOR of any notice (written or oral) from LESSEE under the Lease and of any notice (written
or oral) noting or claiming the occurrence of any default under the Lease by LESSOR or the
occurrence of any event which, with the passage of time or service of notice or both, would
constitute a default by LESSOR under the Lease; and (iii) any request made by any party for
arbitration proceedings pursuant to the Lease and of the institution or commencement of arbitration
proceedings thereunder.
g) Notwithstanding anything contained herein in the Lease to the contrary, the Lease
may be assigned or transferred to any party with LESSOR'S prior written consent, which consent
shall not be unreasonably withheld (it being the understanding ofthe parties that LESSOR'S consent
is to be based solely upon a showing that the assignee or transferee is of a quality and has the
financial capability to perform its lease obligations comparable to LESSEE), as a result of
LENDER'S foreclosure of its interest upon the LEASE or its exercise of any rights granted under
any Instrument or hereunder or if possession or title to the LEASE is acquired by a deed in lieu of
foreclosure or otherwise, whereupon such assignor or transferor shall be released from all liability
for the performance or observance ofthe covenants contained on LESSEE'S part to be performed
and observed from and after the date of such assignment or transfer (it being the intent that such
party be liable to perform the obligations imposed under the Lease only during the period it is in
possession of the Premises or in ownership of the leasehold estate created by the Lease).
Additionally, any party who acquires title to the LEASE and /or possession of the Premises at
foreclosure or by deed in lieu of foreclosure or otherwise, or as a nominee or designee of LENDER,
or who receives title to the LEASE from such nominee or designee, shall be able to assign the Lease
to any other party with LESSOR'S consent which consent shall not be unreasonably withheld.
Notwithstanding the foregoing, any assignment or transfer of the Lease or the LEASE to LENDER,
as a result of LENDER'S foreclosure of its interest upon the LEASE or its exercise of any rights
granted under any Instrument or hereunder or otherwise, shall not require the prior consent of
LESSOR.
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
h) Notwithstanding anything contained herein, in the LEASE to the contrary, while
LENDER, or any of its successors or assigns, holds title to the Lease or possession ofthe Premises
through a receiver or otherwise, and is proceeding to foreclose a lien held by it against the leasehold
estate or obtain a deed in lieu of foreclosure, then (i) no provision in the LEASE requiring repair,
reconstruction or rehabilitation of any improvements or other property following a fire or other
casualty shall be applicable to or enforceable against any such party in the event of a substantial or
uninsurable loss or to an extent in excess of the net insurance proceeds actually received by reason
of such fire or other casualty, and (ii) no obligation to operate any business on the Premises shall be
applicable to or enforceable against any such party.
6. Damage to or Destruction of Improvements.
LESSOR may not terminate the Lease for discontinued use provided in the Lease if
such discontinued use results from any damage to or destruction of the Premises or improvements
thereon which LESSEE or LENDER is proceeding diligently to repair.
7. Notices.
All communications, notices and demands of any kind to any party hereto shall be
sent by registered mail, postage prepaid, addressed as follows:
LESSOR: City of Petaluma
City Hall
11 English Street
Petaluma, CA 94952
LESSEE: Rooster Run Golf Club
414 Aviation Boulevard
Santa Rosa, CA 95403
LENDER: Exchange Bank
Loan Administration Department
PO Box 403
Santa Rosa, CA 95402
Any party may change its address or the name of the person to whom notice shall be
given by giving written notice of such change to the other parties.
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in
triplicate the day and year first written above.
Date: LESSOR: Cl F PETAh
By:
City Manager
ATTEST:
City Clerk
APPROVED AS TO FORM:
Finance Offcer /Auditor
Risk Manager
Date: LESSEE ROOSTER RUN GOLF CLUB, A CALIFORNIA
LIMITED PARTNERSHIP ,
By: ROOSTER RUN GENERAL PARTNERSHIP,
a California General Partnership
By: ..---
Date: LENDER: EXCHANGE BANK,
By:
Name: DAVID aR1"1WN
Its: Vlrr= pRESID NT
PExcliange Bank/General/Misc/Lenders Agreement Rooster Run 11
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
SANTA ROSA MAIN OFFICE
AND ADMINISTRATIVE HEADQUARTERS
v R:
January 6, 1998
Richard R. Rudnansky
Rudnansky & Varner
900 College Avenue
Santa Rosa, CA 95404
Re: Lender's Agreement and Third Amendment to Lease Agreement
City of Petaluma, Rooster Run Golf Club and Exchange Bank
Dear Mr. Rudnansky:
Enclosed is the subject agreement executed by the Bank (Lender), and Rooster Run Golf Club,
Lessee).
Please have the appropriate individuals sign the agreement on behalf of the City of Petaluma
and return to the Bank.
If you have any questions, please contact me at 524 -3328. Thank you for your assistance in this
matter.
Sincerely,
L n/
Assistant Vice President
Im /nds
P.O. BOX 403 • SANTA ROSA, CALIFORNIA 95402 -0403 • (707) 524 -3000
DocuSign Envelope ID: 210DFE93-FD0A-4EB6-A5FD-138E5BA69AE5
ir`
FOURTH AMENDMENT TO LEASE AGREEMENT
THIS'EDURTH AMENDMENT TO'LEASE AGREEMENT (the "Fourth
Amendment"), is made and entered into as:of the first(1st)sday ofNovember,2011 (the
Effective Date"), by and between THE CITY OF'PETALUMA, a public body, corporate and
politic of the Stateof California ("Lessor"),;and ROOSTER-RUN GOLF CLUB,LLC, a
California limited:liability=con paihy("Lessee")..
RECITALS:
This Fourth Amendment is made with referenceto_the following facts:
A. Lessor and a certain third party.notparty hereto„namely Empire Golf,
Inc., a California corporation ("Empire"),-have entered into••that certain Lease Agreement dated
January 7; 1991 (the "Lease"); concerning the construction=and•operation of a golf course on
approximately 126 acres located,onormriear The-Petaluma.Muhieip"aLAirport, Sonoma County,
California.
B. In 1994, Empireiassigned its-interest in.the•Lease to Cottonwood.Golf
Club, Inc. ("Cottonwood") and LeSSor has approved said assignment.
C. Lessor and Cottonwood have amended Lease:pursuant to the terms of
that certain,Ainendment to Lease Agreement dated December+8; 1994, (the"First Amendment")..
D': Lessor'aIidCottonwood have again amended'the Lease pursuant to the
terms of that certain SecondAmendment to Lease Agreement;dated;June:5, 1996, (the"Second
1m --Aniendent'.)pursuant to which the Leased Premises were°redemised to cover the real property
described in the Second Amendment: As used herein, the term-"Leased Premises" shall refer to
the LeasedPremises defined in'the.Second Amendment.
E: Prior to September.1.997, Cottonwood has'assignedits interest in the,Lease
to Rooster Run Golf Club, a California Limited Partnership.("Rooster'Run LP"), pursuant to the
terms of the Lease,theFirst Amendment and the Second Amendment.
F. Rooster Run LP has mortgaged•its`interest in the Lease to;"Exchange
Bank-"'"(herein so calleed),purrsuantto that certain°Deed of Trust-and Assignment'of Rents dated
September 1,7, 199:7„and recorded October 10, 1997, as;Document No.97-92917, Sonoma
CountyRccords (the"Mortgage"),.
G.- Lessor; Rooster Rum LP and Exchange,Bank have amended the Lease
pursuant to•that Lender's Agreement and Third Amendment to'Lease Agreement dated as of
December 19;1997 (the "Third•Amendment").
H. On:or about:April 24, 1998; Rooster Run.LP`assigned its interest in the
Lease to Lessee-pursuant to the term-Ski-hi-le Lease, the First.Amendment, the Second
Aiiiendrnent a id.the.Third Amendment.
1
COOR\48535\859991.1
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L Lessee is the:ctirrent occupantofthe:Leased;Premises and is.operatingthe
golf'course on the terms and conditio`n`s+set forth in:the;Lease,theiFirst Amendment, the Second
At iendnient and the Third Amendment tIbject to.th&Mortgagel.
J.Lessee represents,thattEXeliange Bank,is willing,to amend the terms of the
Mortgagezand the promissory note secured;thereby, including, without limitation, the extension
of the maturity date and.the promissory note to September 1,_;2021, with a:further commitment
for a ten (10) year extension:at:a:fixed rate:of 2.756A:over the then,current ten,;(10),year treasury
rate, bui onlyif the Lease is amended in the manner described.in this Fourth Amendment.
K_ Lessor and Lessee,wish to:amend further the tenns:of the Lease, the First
Amendment, the Second,Anendment, and the Third Amendment.in;the manner set forth in this
Fourth Amendment.
ACCORDINGLY, for good and valuable consideration, the receipt and
sufficiency ofwhich is hereby acknowledged, Lessor andLessee hereby agree to amend the
Lease, the First Amendment; the Second Amendment and the Third Amendment as follows:
1.Status of Lease: Lessor and Lessee agree and acknowledge that the Lease,
the First Amendment, the Second Amendment, and the Third-Amendment are in full force and
effect and, except for this Fourth Amendment, have not been:Otherwise modified or.-amended.
2.Rent. As and`for rent for the LeasedPremises, Tenant':shall pay
percentage rental for the perm dbegimnng-;November 1, 2011, for the balance of the Lease term
ii1$the.maimer described in`this`FO ffth Amendment.
a) Paragraphs 7.1(a).and'7.2(4of'the Lease are deleted in their
drifi'rety';
b) For purposes of this FOnfth.Ainefarhentthe;term, "Gross
Revenue"shall`mean only money received'by Lessee from:green fees;,'cart rentals and driving
range.fees:and:from no,othersource or activity and shall notinclude the items set forth in
sub`sections;8(1)through 8(14) of the Lease, inclusive. All other sources of income received by
Lessee,from:the operatiomof the golf course and ownership'of Lessee's interests in the golf
course.sliall be excluded from Gross Revenue.
c)' From`and after the Effecti`veiDate; the.tertn "Lease Year" means a
twelve'(12);month period commencing each and ever-Only-1 thereafter:occurringand
terminating'on eachsand every June 36:thereafter occurring; Lease'Year 15 shall commence on
July 1,. 012.
d) From November 1 2011 until June,30;2012„Lessee shall pay rent
payments to Lessor in arrears,omthe 15th day of each calendar month in the amount of three
pefcent1(3%) of Gross Revenue.
e) -From and after July 1, 20,12.(the commencemenuof Lease Year
15),Lessee shall payrentpayments to Lessor in;arrears on the 15th-day-of each calendar month,
iii accordance-with the followingschedule:
2
COOR\48535\85999 L I
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LEASE
YEARS 15 16:20 21 23 t24=28 29 30 31 32. '33=40 41=60*
GREEN
FEES'3% 4%5.0% 7:5% 8% 8.5% 9% 9:5% 10.0% 16.0%
CARTS 3% 4%5,;0% 7'.5% 8% 815% 9% 9.5% 10.0% 10.0%
RANGE 3% 4%5..0% 7„5% 8% 8.5% 9%0 9.5% 10.0% 10.0%
If Lessee eercises:option to?,ektend described in'Paragraph,4.2 of the Lease.
f) The,plirase: "On or before 15th day Ofeach calendar month
starting in the second (2nd);m'o"nth:of the eleventh(11th) yearof the Lease"shall be,deleted from
the beginning of Paragraph 7 2(b)ofthe Lease and.replaced`with the following:
Conimencing,ori December 15, 201.1 and.oli,theififteenth day of
each and every calendar month for the balance.of'the term of the
Lease....."
3.Elimihation,ofSUbordination:by Lessor. Paragraph 6.1(C) of the Lease,
Paragraph 2 of the First Amendment and the last sentence;o f the first grammatical paragraph of
Paragraph 4 of the Third Amendmentiareall deleted in their entirety: Lessor shall have no
obligation to subordinate its,fee interest or;anyinterest in,thel,eased Premises to any existing or
future indebtedness or obligation of Lessee or any assigns;"transferees;or successors to Lessee's
interests in the Lease,including Lender:and any assigns, transferees'orsuccessors of Lender,
wliethersaid indebtedness or!obligationis to Lender-or<to other persons.or entities.
4.Exchange Bank. This Fourth Aihendinent is Conditioned upon the
execration by Exchange Bank-in theispace'provided below bya'date:no later than December 31,
20r1-.
5.Capitalized'Terms. All capitalized'tenns and phrases used in this Fourth
Amendment;shall be.given°the same:meaning ascribed to that;:term or'phrase'in the Lease and
First Amendment,,the{Second Amendment and the Third-Amendment, except as otherwise
providedein this Fourth-Amendment.
6.Recording. Neither the Lease„the First Ainendnieiit, the Second
Amendment, the Third Amendment,nor this Fourth Amendment shall be recorded; provided,
however, a Memorandum of Lease,and;theFirst Amendment the Second Amendment, the Third
Amendmenuandthis Fourth Amendment`in a form reasonably acceptable to the City Manager
and Lessee.may be recorded atany-time by either party in The Official Records of Sonoma
County.
7.Conflicts. In The of any-conflict between the terms of the Lease, and
the First:Amendment, the Second Amendment and the Third Amendment-on ofie hand and the
ternis.of this Fourth Amendment on the other hand, the terms of this fourth Amendment shall
govern and prevail.
3-
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8.Counterparts. This'''Fourth,Amend iefit may be,executed_in identical
counterparts-and each co"unterpait togetl er shall constitute a single integrated document.
IN'WITNESS.WHEREOE,:the parties hereto have set their hand, effective as of
the Effective Date.
LESSOR: CITY OF'PETAI2UMt1
City Manager
ATTEST:
City Clerk
APPROVED'AS"TO FORM:
Cif _ II 1,--•-
ante D i ector APPROVED As to Form a- ,
s Manager Risk Management /2..- -- L
LESSEE: ROOSTER R GOLF CLUB,LLC,
J
aCalifornia1imited liability coinpany
By: ROOSTER RUN:GENERAL PARTNERS,
a Califon-na-general-part ership, Manager
By: 1 / "1.7 i
RIC• . . D A. Cost : ,
General Partner
The undersigned herebyaccepts and approves-the terms of this Fourth
Amendment.
EXCHANGE BANK
By:
Name:.
Its:
1756201.1
4-
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8. Counterparts. This.Fourth.Amendment maybe executed in identical
counterparts and each counterpart,together shall coristitute,a.single integrated document.
IN WITNESS WHEREOF, the parties hereto have set their hand, effective as of
the Effective Date.
LESSOR: CITY OF PETALUMA
By:
City Manager
ATTEST:
City Clerk
APPROVED AS TOjD , co
ALaiii e iir'"-------'
City Attorney
Finance Director
Risk Manager
LESSEE: ROOSTER RUN GOLF CLUB, LLC,
a California limited liability company
By: ROOSTER RUN GENERAL PARTNERS,
a California general partnership, Manager
By
RICHARD A. COOMBS,
General.Partner
The undersigned hereby accepts and approves the terms of this Fourth
Amendment.
EXCHANGE BANK
By:
Name:
Its:
1756201.1
4
COOR\48535\859991.1
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SIGNATURE ROUTING SHEET
FOR
FIFTH AMENDMENT TO LEASE AGREEMENT
Rooster Run
Agreement/Project Title)
Please keep the original ofthis document with the City Clerk's executed original of the contract.
CITY OF PETALUMA
DocuSigned by:
T-,(-f 4 .. 6/16/2021
Peggy ynn, i Manager Dated
ATTEST:
DocuSigned by:
6/16/2021
KenDmose:
4,4tity Clerk's Office Dated
APPROVED AS TO FORM:
DocuSigned by:
5/27/2021
Eric Danly,City Attorney Dated
APPROVED:
N/A
Charlie Castillo,Department Director Dated
APPROVED:
DocuSigned by:
3/22/2021
Erika ea y, isk Manager Dated
APPROVED:
5DocuSigned
by:
rbVt Gay t k6 6/15/2021
Corey ar ero io,Finance Director Dated
file name:
Signature Routing Sheet(Feb 2020)
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DocuSign Envelope ID:45772B43-8A7F-4287-8A1C-DKOE62DE41E
Attachment 2
FIFTH AMENDMENT TO LEASE AGREEMENT
THIS FIFTH AMENDMENT TO LEASE AGREEMENT (the "Fifth Amendment"), is made and
entered into as of the 16th day of Tune 2021 (the "Effective Date"), by and
between THE CITY OF PETALUMA, a public body, corporate and politic of the State of California
Lessor"), and ROOSTER RUN GOLF CLUB, LLC, a California limited liability company
Lessee").
RECITALS:
This Fifth Amendment is made with reference to the following facts:
A. Lessor and a certain third party not party hereto, namely Empire Golf,
Inc., a California corporation ("Empire"), have entered into that certain Lease Agreement dated
January 7, 1991 (the "Lease"), concerning the construction and operation of a golf course on
approximately 126 acres located on or near the Petaluma Municipal Airport, Sonoma County,
California.
B. In 1994, Empire assigned its interest in the Lease to Cottonwood Golf
Club, Inc. ("Cottonwood") and Lessor has approved said assignment.
C. Lessor and Cottonwood have amended the Lease pursuant to the terms
of that certain Amendment to Lease Agreement dated December 8, 1994, (the "First
Amendment").
D. Lessor and Cottonwood have again amended the Lease pursuant to the
terms of that certain Second Amendment to Lease Agreement dated June 5, 1996, (the
Second Amendment") pursuant to which the Leased Premises were redemised to cover the
real property described in the Second Amendment. As used herein, the term "Leased
Premises" shall refer to the Leased Premises defined in the Second Amendment.
E. Prior to September 1997, Cottonwood has assigned its interest in the
Lease to Rooster Run Golf Club, a California Limited Partnership ("Rooster Run LP"), pursuant
to the terms of the Lease, the First Amendment and the Second Amendment.
F.Rooster Run LP has mortgaged its interest in the Lease to "Exchange
Bank" (herein so called) pursuant to that certain Deed of Trust and Assignment of Rents dated
September 17, 1997, and recorded October 10, 1997, as Document No. 97-92917, Sonoma
County Records (the "Mortgage").
G. Lessor, Rooster Run LP and Exchange Bank have amended the Lease
pursuant to that Lender's Agreement and Third Amendment to Lease Agreement dated as of
December 19, 1997 (the "Third Amendment").
H. On or about April 24, 1998, Rooster Run LP assigned its interest in the
Lease to Lessee pursuant to the terms of the Lease, the First Amendment, the Second
Amendment and the Third Amendment.
C OO R-48535\2260920.2
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I. Lessor, Lessee and Exchange Bank have amended the Lease pursuant
to that certain Fourth Amendment to Lease Agreement dated November 1, 2011, pursuant to
which the rent schedule was modified (the "Fourth Amendment").
J.Lessee is the current occupant of the Leased Premises and is operating
the golf course on the terms and conditions set forth in the Lease, the First Amendment, the
Second Amendment, the Third Amendment and the Fourth Amendment subject to the
Mortgage.
K. Lessee was forced to close the golf course for a period of time in 2020
due to the Covid-19 pandemic. During the time of closure, Lessee maintained the golf course at
Lessee's own expense despite receiving no revenues during this time period.
L.Lessor and Lessee wish to amend further the terms of the Lease, the
First Amendment, the Second Amendment, the Third Amendment and the Fourth Amendment
in the manner set forth in this Fifth Amendment.
ACCORDINGLY, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, Lessor and Lessee hereby agree to amend the Lease, the
First Amendment, the Second Amendment, the Third Amendment and the Fourth Amendment
as follows:
1.Status of Lease. Lessor and Lessee agree and acknowledge that the
Lease, the First Amendment, the Second Amendment, the Third Amendment and the Fourth
Amendment are in full force and effect and, except for this Fifth Amendment, have not been
otherwise modified or amended.
2.Rent. Lessor and Lessee agree that notwithstanding anything stated in
the Lease, the First Amendment, the Second Amendment, the Third Amendment and/or the
Fourth Amendment to the contrary, Lessee shall pay rent for the period of March 1, 2020
through June 30, 2022 as follows:
i) From March 1, 2020 to September 30, 2020, Lessee shall
pay zero (0) rent.
ii) From October 1, 2020 through June 30, 2022, Lessee
shall pay monthly rent in the amount of two and one-half
percent (2 1/2%) of green fees, cart rentals and range
income.
iii) Commencing June 1, 2022, Lessee shall pay rent in
accordance with the Lease as amended by the First
Amendment, the Second Amendment, the Third
Amendment and the Fourth Amendment subject to the
terms of Paragraph 3, below.
3.Continued Negotiations For Modified Rent Structure. Lessor and Lessee
hereby agree to meet and confer in good faith on a routine basis to negotiate a revised rental
structure for the Lease taking into account all relevant factors with the goal of entering into a
new lease with a new rent structure prior to December 1, 2021. The relevant factors include,
without limitation, the burden on Tenant of required capital improvements to the golf course and
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the buildings, use in connection thereof and assuring Lessee a reasonable return on such
capital expenditures and the amenities and benefits that golf courses and maintained open
space provide for community which amenities and benefits will be lost to the community if
Lessee is unable to meet its debt service obligation and/or operate the golf course at a
reasonable profit.
4.Prohibition of Use of Gyyphosate. Lessee agrees to immediately
discontinue all use of weed control products containing the chemical "glyphosate" throughout
the grounds under management by Lessee. This prohibition includes products commonly sold
under the brand name "RoundUp", as well as any other products containing glyphosate.
5.Capitalized Terms. All capitalized terms and phrases used in this Fifth
Amendment shall be given the same meaning ascribed to that term or phrase in the Lease and
First Amendment, the Second Amendment, Third Amendment and the Fourth Amendment,
except as otherwise provided in this Fifth Amendment.
6.Conflicts. In the event of any conflict between the terms of the Lease,
and the First Amendment, the Second Amendment, the Third Amendment and the Fourth
Amendment on one hand and the terms of this Fifth Amendment on the other hand, the terms of
this Fifth Amendment shall govern and prevail.
7.Counterparts. This Fifth Amendment may be executed in identical
counterparts and each counterpart together shall constitute a single integrated document.
Remainder of Page Left Blank Intentionally— Please See Next Page for Signatures]
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IN WITNESS WHEREOF, the parties hereto have set their hand, effective as of
the Effective Date.
LESSOR: CITY O ,g AgJPA
By:
T T
It
UJ
anager---
Tea by:
City er
P.8QnV9P AS TO FORM:
aQQQn i ctor
Ris
U
VAa"ger
LESSEE:ROOSTER RUN GOLF CLUB, LLC,
a California limited liability company
By: ROOSTER RUN GENERAL PARTNERS,
a California general partnership,
Manag DocuSigned by:
By.
RIEUkbbX.ACOOIVIBS,
General Partner
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EXHIBIT F
AGREEMENT FOR THE PURCHASE AND USE OF RECYCLED WATER
THIS AGREEMENT (“Agreement”) is made this _____ day of ________________, 2022, between
the City of Petaluma, a California municipal corporation and Charter City (“City”), and Rooster Run
Golf Club LLC, (“Purchaser”). City and Purchaser are also each referred to in the singular in this
Agreement as a Party and in the plural as the Parties.
RECITALS A. Purchaser leases approximately 126 acres of real property owned by the City in Sonoma
County, California, located at 2301 East Washington Street identified as Assessor's Parcel
No. 13607029, referred to as the Leased Premises in the Restated Lease of which this
Agreement is Exhibit F ("Leased Premises"). This Agreement is part of the Restated Lease.
The Leased Premises is further described in Exhibits A-D which are attached to and a part of
the Restated Lease.
B. City owns and operates a wastewater treatment and water recycling facility, ("City Recycled
Water Facilities"), and collects, treats, and disposes of wastewater produced within the City’s
service area.
C. The City Recycled Water Facilities produce tertiary treated recycled water (“recycled water”)
for irrigation and other lawful purposes. City produces such recycled water pursuant to
Order No. 96-011 of the California Regional Water Quality Control Board, San Francisco
Bay Region (“Order”), which is attached to and made a part of this Agreement as Exhibit A.
The City’s delivery and Purchaser’s use of recycled water is subject to the Order and to the
requirements of the City’s National Pollution Discharge Elimination System permit
(“Permit”) and any successor permits governing discharge of recycled water into the
Petaluma River which Permit is made a part of this Agreement by this reference.
D. City desires to sell and Purchaser desires to purchase and use recycled water from City for
irrigation of the Leased Premises, subject to the terms of this Agreement and of the Restated
Lease.
In consideration of the mutual agreements, terms and conditions contained in this Agreement, the parties agree as follows.
1.0 DEFINITIONS
(A) Board means the California Regional Water Quality Control Board, San Francisco
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2
Agreement for Purchase and Use of Recycled Water Restated Lease Exhibit F March 2022
Bay Region.
(B) Director means the City of Petaluma’s Director of Public Works and Utilities or
designee.
(C) Irrigated Land means the area(s) of the Leased Premises that are to be irrigated with
Recycled Water in accordance with this Agreement.
(D) Off Season means the period during which the need for irrigation water is typically
reduced and the City is prohibited from discharging recycled water to the Petaluma
River. The Off Season commences on November 1 each year and extends until April
30 of the subsequent year.
(E) Order means General Water Reuse Order No. 96-011, or successor authority,
establishing requirements for reuse of City Recycled Water, as may be issued,
modified or reissued by the Board or successor governmental agency.
(F) Peak Season means the period during which the need for irrigation water is typically
increased and the City is permitted to discharge recycled water to the Petaluma River.
The Peak Season commences on May 1 each year and extends until October 30 of
that year.
(G) Permit or Permits means the City’s National Pollution Discharge Elimination System
(NPDES) permit, or successor permit, establishing requirements for the discharge of
City treated wastewater into the Petaluma River.
2.0 RECITALS. The recitals above are incorporated into and made a part of this Agreement.
3.0 TERM. This Agreement shall become effective on the Commencement Date of the Restated Lease and shall expire on the Expiration Date of the Restated Lease. In the event the Restated Lease is terminated during the Term of this Agreement, this Agreement shall
automatically terminate at the same time that the Restated Agreement terminates without further action of the parties. 4.0 PURCHASE PRICE. For the Term of this Agreement, Purchaser will pay the City for recycled water delivered to the Purchaser in accordance with this section. The rates that
apply to recycled water delivered to Purchase in accordance with this Agreement are referred
to as the “Purchase Price.” The Purchaser will pay for recycled water delivered pursuant to this Agreement (A) At the rate of 4% of the All Other Users, Non-Temporary Potable rate for usage
within Purchaser’s Peak Season allotment of 325 acre feet, and
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3
Agreement for Purchase and Use of Recycled Water Restated Lease Exhibit F March 2022
(B) At the rate of 8% of the All Other Users, Non-Temporary Potable rate for usage exceeding Purchaser’s Peak Season allotment of 325 acre feet, pursuant to Resolution
No. 2017-75 N.C.S. adopted May 15, 2017 as adjusted in accordance with its terms
and any duly adopted successor rates. As of the date of the execution of this Agreement, the current All Other Users, Non-Temporary Potable rate is $2,086.52 per acre foot. The Purchase Price shall not be subject to
any offsets for Purchaser’s costs of maintaining or operating Purchaser’s water system.
5.0 CONNECTION AND CAPACITY FEES. City Water connection and capacity fees will not apply to Purchaser’s existing connection to the City recycled water system. Other development of the Leased Premises shall be subject to all applicable City development-
related fees.
6.0 METERING AND MEASUREMENT OF FLOWS. Purchaser agrees that the City shall read the meter and record recycled water used at the point of connection on the Leased Premises depicted in Exhibit B to this Agreement.
7.0 PAYMENT OF RECYCLED WATER INVOICES. City shall invoice Purchaser for the cost of recycled water used by Purchaser on a monthly basis based on meter readings. Said invoices shall be due and paid within 30 days of the date of billing. Delinquent invoices for recycled water pursuant to this Agreement, in addition to being subject to the provisions of
this Agreement, shall be subject to penalties, enforcement and other requirements applicable
to water service contained in Title 15 of the Petaluma Municipal Code, as amended from time to time. 8.0 DELIVERY AND USE OF RECYCLED WATER.
(A) City Delivery. City agrees to deliver recycled water to Purchaser at the irrigation meter installed by City at the point of connection on the Leased Premises depicted in Exhibit B in accordance with this Agreement.
(B) Minimum Recycled Water Usage. Purchaser agrees to use and the City agrees to
deliver a minimum of 300 acre-feet of recycled water per year, which shall be
referred to herein as the “Committed Volume.” Purchaser’s failure to use the
Committed Volume will result in the City billing Purchaser for an amount of recycled
water equal to the difference between Purchaser’s actual use and the Committed
Volume, as liquidated damages, which amount shall be due and payable in
accordance with Section 7.0, so long as Purchaser’s failure to use the Committed
Volume is not due to a lack of or interruption in supply, failure of City delivery
systems or other limitations on availability as described in Section 9.0 hereof.
(C) Change in Committed Volume. Should Purchaser or City desire to change the
Committed Volume for any year, Purchaser and City may agree to amend the
Committed Volume by February 1 of that year in accordance with section 17(D). The
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change in Committed Volume will take effect on the July 1 immediately following
the Parties’ agreement to amend the Committed Volume, or at another time on which
the Parties have agreed.
(D) Maximum Flow Rate. The maximum flow rate of recycled water the Purchaser is permitted to use shall be 670 gallons per minute. Purchaser agrees to irrigate at or below the maximum flow rate specified in this provision.
(E) Maximum Allocation. The maximum volume of recycled water the Purchaser is
authorized to use during the Peak Season is 325 acre-feet (“Maximum Allocation”). The Purchase Price for recycled water Purchaser receives within the Maximum Allocation will be as specified in Section 4.0(A). The Purchase Price for recycled water in excess of the Maximum Allocation that Purchaser requests and that the City
in its sole discretion agrees to provide will be as specified in Section 4.0(B).
(F) Irrigation Line and Irrigation Equipment. Purchaser’s use of recycled water must be in accordance with all applicable requirements of the Order and the Permit, any other applicable laws and regulations, and with the following:
(1) Connection to City Pipeline. Location of connection to City’s recycled water
pipeline shall be as described in Exhibit B unless otherwise approved by City.
(2) Hose Bibs. No hose bibs shall be connected to the recycled water pipeline.
(3) Runoff. Purchaser’s on-site irrigation system must be configured and
operated to prevent runoff from leaving Irrigated Land or the Leased
Premises.
(4) Identification Tags. All meters, valves, blowoffs, and controllers shall be
identified using recycled water identification tags, T. Christy Enterprises
3150, or equal. Tags shall be weatherproof plastic, 3-inch by 4-inch, purple in
color with the words “RECYCLED WATER – DO NOT DRINK,” or similar
printed on one side, and “AQUA IMPURA – NO TOMAR,” on the other side,
or similar as approved by the Engineer.
(5) Plans. Purchaser shall prepare and submit plans for any proposed alterations
to the connection to City’s recycled water pipeline for portions owned and
installed by Purchaser up to the point of connection to the City’s irrigation
system (the irrigation meter). City shall review plans and establish conditions
of approval, which approval shall not be unreasonably withheld.
(G) Water Pressure. The pressure of recycled water delivered by City will vary and can be as high as approximately 110 psi. However, the City makes no guarantee
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concerning the pressure of delivered recycled water. The City expressly disclaims any guarantee, warranty or representation that the recycled water delivered by the
City will conform to any particular pressure requirements of Purchaser’s facilities.
Purchaser understands and agrees that Purchaser must install pressure regulators and any and all other appurtenances or equipment necessary to protect Purchaser’s equipment from high pressures or surges within the City’s System or to maintain a desired recycled water pressure for Purchaser’s system.
(H) Purchaser’s Maintenance Responsibility. Purchaser shall operate, maintain and repair all recycled water pipeline and appurtenances downstream (on the Purchaser’s side) of the City’s irrigation meter connecting the City Facilities to the Purchaser’s irrigation system.
(I) City’s Maintenance Responsibility. Subject to the terms of this Agreement, City shall operate, maintain and repair City’s recycled water facilities and pipelines up to and including the irrigation meter installed by City connecting the City Facilities to the Purchaser’s irrigation system.
(J) On-Site Supervisor. Purchaser shall designate in writing an on-site supervisor who is responsible for the safe and efficient operation of the Purchaser’s recycled water system. The on-site supervisor shall be knowledgeable about all facets of Purchaser’s irrigation system, including regulations, layout of the system, and maintenance.
Purchaser and on-site supervisor shall be trained and certification shall be provided
by the Purchaser to the City as to the qualifications and training of the on-site supervisor, to the satisfaction of the City. (K) Scheduling of Usage. The City must dispose of approximately its entire daily
recycled water production through City use and distribution to City recycled water
customers. Purchaser agrees to participate in recycled water delivery scheduling meetings as may be convened by the City from time to time to coordinate recycled water delivery schedules for all users. The purpose of such meetings is to establish delivery schedules and delivery flow rates that will dispose of City’s recycled water
and that can be sustained by the City Facilities, and that will meet most needs of
recycled water customers. The City will use reasonable efforts to accommodate recycled water customers,’ including purchaser’s, reasonable requests regarding recycled water delivery schedules and flow rates. City recycled water delivery schedules and flow rates for all recycled water customers shall be in the City’s sole
discretion. City-determined recycled water delivery schedules and flow rates will
govern availability to Purchaser of recycled water under this agreement. If Purchaser fails to participate in recycled water delivery schedule meetings in accordance with this section, the Committed Volume pursuant to this Agreement may be amended, or this Agreement terminated, in accordance with its terms.
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9.0 LIMITATIONS ON DELIVERY OF RECYCLED WATER.
(A) Limitations. Notwithstanding any requirements in this Agreement for either Party to
deliver or accept recycled water, the City and Purchaser understand and agree that delivery or acceptance of recycled water may at times be precluded, impracticable, or otherwise prevented or infeasible for reasons beyond the reasonable control of City or Purchaser. City will not be obligated to provide and Purchaser will not be obligated
to accept recycled water when delivery or acceptance is prevented by a cause beyond
either Party’s reasonable control, including, but not limited to: Acts of God, shortage of recycled water, malfunction of either party's system, temporary imbalance of recycled water in the various storage ponds comprising part of the City Facilities, changes in applicable discharge or monitoring requirements, a determination by any
regulatory agency that recycled water is not suitable for the intended use, or a
determination or allegation by a body of competent jurisdiction that the use of recycled water pursuant to this Agreement is unlawful. The Parties agree to cooperate in good faith in case of an event that wholly or partly excuses delivery or use of recycled water pursuant to this provision to fulfill the purposes of this
Agreement and to restore delivery and use of recycled water as soon as reasonably
practicable. City agrees to use reasonable efforts to provide Purchaser with 24 hours advance notice of anticipated interruptions in service due to construction, repairs or other causes within the City’s control.
(B) Allocation of Limited Supply of Recycled Water. Purchaser understands and agrees
pursuant to this provision 9.0 that the City does not and cannot guarantee to Purchaser uninterrupted supply or use of recycled water. In accordance with this Agreement, City will use reasonable efforts to supply to Purchaser and Purchaser will use reasonable efforts to use recycled water so that Purchaser can use at least the Committed Volume pursuant to provision 8.0(B) of this Agreement. In the event of a
recycled water shortage for any reason, City will use reasonable efforts to equitably distribute available recycled water to users, including Purchaser, who have entered into recycled water purchase and use agreements with City. Purchaser understands and agrees that in case of a recycled water shortage, City will allocate available recycled water giving preference to users based on the seniority of the user’s
agreement for purchase and use of recycled water with the City. 10.0 MONITORING. Purchaser will be solely responsible for managing and monitoring the storage and distribution of recycled water under the control of Purchaser (downstream or on
the Purchaser’s side of the City irrigation meter). So long as this Agreement remains in
effect and as a condition of receiving recycled water pursuant to this Agreement, Purchaser hereby grants City, acting through its duly authorized employees, agents and representatives, reasonable access to the Leased Premises for the purpose of sampling, meter reading, and observing as reasonably required, Purchaser’s use of recycled water. City will use
reasonable efforts to provide Purchaser (or a representative) with reasonable prior notice of
any such observation on the Leased Premises and will allow Purchaser to be present during any such access pursuant to this provision and will use reasonable efforts to avoid interfering with Purchaser’s operations on the Leased Premises.
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11.0 PURCHASER OBLIGATIONS CONCERNING SUITABILITY OF RECYCLED WATER.
(A) Regulatory Agencies. City and Purchaser understand and agree that all recycled water delivered to Purchaser pursuant to this Agreement shall be subject to the current and future water recycling requirements established by the Permit, the Order,
and other applicable requirements. City will make available to Purchaser upon
request such test reports as are periodically required of City by regulatory agencies to characterize the recycled water. The results of these tests are maintained at the City’s Department of Public Works and Utilities, Environmental Division. (B) Recycled Water Constituents. Purchaser and City understand and agree that recycled water delivered by City is filtered, and may contain algae and other constituents which, if not removed, may adversely impact Purchaser’s irrigation equipment. It is Purchaser’s responsibility to install and operate equipment as necessary to remove
constituents in recycled water delivered pursuant to this Agreement that may impact Purchasers’ irrigation or other equipment. It is Purchaser’s responsibility to properly manage and dispose of material removed from recycled water by Purchaser’s equipment.
(C) Suitability. Purchaser understands and agrees that recycled water delivered by City is produced through treatment of wastewater. It is Purchaser’s responsibility to
determine and confirm that the quality of recycled water delivered by City is
consistent with water quality and other requirements that apply to Purchaser’s use of recycled water, including, but not limited to, the requirements of the portions of the Leased Premises that Purchaser intends to irrigate with recycled water.
12.0 RECYCLED WATER APPLICATION AND USE RESTRICTIONS. Purchaser agrees as a
material term of this Agreement to use recycled water in compliance with all applicable laws, ordinances, or regulations now in effect or hereafter enacted or adopted. Recycled water supplied pursuant to this Agreement may only be used on the Leased Premises for irrigation of the Leased Premises in accordance with the terms of this Agreement, the Order, the Permit and all applicable laws and regulations. No other uses of the recycled water delivered
pursuant to this Agreement are permitted. Purchaser agrees to notify City of known violations of laws and/or regulations, or damage to City irrigation facilities or other City Facilities or property within 24 hours of discovery of such violation or damage. Purchaser shall be solely responsible for the cost of repair for damage caused by Purchaser or Purchaser’s employees, agents, or contractors or others acting on behalf of or under
Purchaser’s control arising from or related to use of recycled water pursuant to this Agreement. If Purchaser does not comply with the Order, the Permit, or other laws, ordinances, or regulations governing the use of recycled water pursuant to this Agreement, in addition to and not in lieu of any other remedies available to the City pursuant to this Agreement or applicable law, City may immediately cease recycled water delivery pursuant
to this Agreement upon notice to Purchaser until such non-compliance is cured. The City may also terminate this Agreement for Purchaser’s non-compliance in accordance with Section 18.
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13.0 TRAINING. Purchaser is responsible for ensuring that Purchaser’s recycled water system maintenance, irrigation, management and operations staff and any others that may come into
contact with recycled water on the Leased Premises understand the presence of recycled
water on the Leased Premises, that recycled water is not for human consumption, recycled water shall not be used as an animal water supply, and the safe use of recycled water and operation of the recycled water system. Purchaser’s on-site supervisor shall be trained and certification shall be provided by the Purchaser to the City as to the qualifications and
training of the on-site supervisor, subject to acceptance and approval of the City.
14.0 ASSIGNMENT. Purchaser’s rights and obligations under this Agreement are assignable subject to and on the same terms as the assignment of the Restated Lease. Any other purported assignment, subcontracting or transfer of Purchaser’s rights or obligations pursuant
to this Agreement without the City’s prior written approval shall be void. Any assignment,
subcontracting or transfer of Purchaser’s rights or obligations pursuant to this Agreement shall be subject to all terms and conditions of this Agreement. 15.0 INDEMNIFICATION. Purchaser’s obligation to indemnify and defend the City pursuant to
Section 20 of the Restated Lease shall apply to liability arising out of or relating to the use of
recycled water pursuant to this Agreement or the breach of any provision of this Agreement, the Order, or the Permit. This provision will survive the termination or expiration of this Agreement.
16.0 METHOD AND PLACE OF GIVING NOTICE. Except as otherwise specified in this
Agreement, all notices sent pursuant to this Agreement shall be made in writing, and sent to the Parties at their respective addresses specified below or to such other address as a Party may designate by written notice delivered to the other Party in accordance with this Section.
(A) All such notices shall be sent by: (1) personal delivery, in which case notice is effective upon delivery; (2) certified or registered mail, return receipt requested, in which case notice shall
be deemed delivered on receipt if delivery is confirmed by a return receipt;
(3) nationally recognized overnight courier, with charges prepaid or charged to the sender’s account, in which case notice is effective on delivery if delivery is confirmed by the delivery service; or
(4) facsimile transmission, in which case notice shall be deemed delivered upon transmittal, provided that (a) a duplicate copy of the notice is promptly delivered by first-class or certified mail or by overnight delivery, or (b) a transmission report is generated reflecting the accurate transmission thereof.
Any notice given by facsimile shall be considered to have been received on
the next business day if it is received after 5:00 p.m. recipient’s time or on a non-business day.
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(B) Addresses:
City: City Clerk
City of Petaluma Post Office Box 61 Petaluma, California 94953 Telephone: (707)778-4360
Facsimile: (707)778-4554
And: Director of Public Works and Utilities
City of Petaluma
202 North McDowell Boulevard Petaluma, California 94954 Telephone: (707)778-4546 Facsimile: (707)778-4508
Purchaser: Rooster Run Golf Club LLC c/o Airport Business Center 414 Airport Blvd., Santa Rosa, CA 95403-1069 Attn: Richard A. Coombs and Larry L. Wasem
17.0 MISCELLANEOUS PROVISIONS. (A) No Waiver of Breach. The waiver by either Party of any breach of any term or
promise contained in this Agreement shall not be deemed to be a waiver of such term
or provision for any subsequent breach of the same or any other term or promise contained in this Agreement. (B) Uncertainty. This Agreement is the product of negotiation and compromise on the
part of both Parties. The City and Purchaser agree, notwithstanding Civil Code
Section 1654, that in the event of uncertainty, the language is not to be construed against the Party causing the uncertainty to exist. (C) No Third Party Beneficiaries. Nothing contained in this Agreement shall be
construed to create and the Parties do not intend to create any rights in third parties.
(D) Amendment. This Agreement may only be amended by a writing signed by persons authorized to bind the City and Purchaser.
(E) Merger. This Agreement constitutes the entire Agreement between the City and
Purchaser.
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18.0 TERMINATION. The Parties may treat a breach of this Agreement as a breach of the Restated Lease in accordance with Sections 25 and 26 of the Restated Lease.
IN WITNESS WHEREOF, the Parties hereto have executed this document the day, month and year
first above written.
CITY OF PETALUMA PURCHASER ROOSTER RUN GOLF CLUB LLC By By
Peggy Flynn, City Manager Rich Coombs, General Partner Rooster Run Golf Club LLC ATTEST:
City Clerk Petaluma Business Tax Receipt Number APPROVED AS TO FORM:
Eric Danly, City Attorney Attachments: Exhibit A – California RWQCB Order 96-011
Exhibit B – Diagram of point of recycled water connection on the Leased Premises
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EXHIBIT A
ORDER NO. 96-011
OF THE CALIFORNIA REGIONAL WATER QUALITY
CONTROL BOARD
SAN FRANCISCO BAY REGION
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EXHIBIT B
POINT OF CONNECTION ON THE LEASED PREMISES
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EXHIBIT “H”
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EXHIBIT “I”
TECHNICAL SPECIFICATIONS FOR THE
MAINTENANCE OF ROOSTER RUN GOLF COURSE CITY OF PETALUMA, CALIFORNIA
Lessee shall utilize these specifications as a minimum. Standards and frequencies may be modified as effected by growing seasons for the proper maintenance of the golf course. Lessee will be expected to maintain the Premises in a good, playable condition at least comparable to other public
golf courses in Sonoma County of this type and caliber, with similar fee schedules. As used in
this Exhibit “F”, the term “as needed” shall mean at such frequency and in such manner as is necessary to keep the Course (and the particular aspect of the Course which is the subject of any provision hereof) in a good, playable condition at least comparable to other public courses in Sonoma County of this type and caliber, with similar fee schedules.
1. Maintain all GREENS observing the following minimum requirements:
a. Change cups and repair all ball marks as needed.
b. Mow as needed at a height of 3/8” or less and remove clippings.
c. Verticut as needed on a year-round basis.
d. Aerate a minimum of twice a year.
e. Topdress, as needed, following each aerification and verticutting with a soil
mixture compatible to the soil structure. Additionally. all greens should be topdressed following over seeding twice a year.
f. Treat in a preventative manner for control of insects, disease, weeds and other pests to insure a year-round healthy turf that is conducive to the
established turf.
g. Apply fertilizer as determined by soil test results.
2. Maintain all TEES observing the following minimum requirements:
a. Move markers and benches as needed.
b. Mow as needed at a height of 1/2” or less.
c. Mow as needed at a height of 1/2” or less.
d. Aerify at least four times per year.
e. Repair worn and damaged turf areas as they occur to insure playable tees at all times.
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f. Treat in a preventative manner for the control of insects, disease, weeds and other pests to insure a year-round turf that is conducive to the established
turf.
g. Apply fertilizer as determined by soil test results.
h Maintain ball washer with clean water and soap daily. Provide clean tee towels on a daily basis or as dictated by use.
3. Maintain all Fairways and Irrigated Roughs observing the following minimum
requirements:
a. Mow Fairways at least twice per week at 1” height or less.
b. Mow Irrigated Roughs at least once per week at 1-3/4” height or as determined by Lessee.
c. Aerify all Fairway as needed and as required by soil conditions.
d. Aerify all Irrigated Roughs as needed and as required by soil conditions.
e. Overseed and topdress (or resod) worn or bare areas of Fairways and Irrigated Roughs as they occur.
f. Treat turf in a preventative manner to control weeds, disease, insects and other pests to insure a year-round healthy turf that is conducive to the
established turf.
g. Apply fertilizer as determined by soil test results.
4. Maintain Driving Range Turf and Miscellaneous Landscape Lawn areas observing the following minimum requirements:
a. Now at least once per week at 1-1/2” height or less.
b. Aerify at least two times per year.
c. Overseed and topdress (or re-sod) worn or bare spots in turf as they occur.
d. Treat turf in a preventative manner to control weeds, diseases, insects and other pests to insure a year-round healthy turf that is conducive to the established turf.
e. Apply fertilizer as determined by soil test results.
5. Establish and maintain at all times a sod nursery (one each) for greens, tees and fairways.
a. Greens.
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1) Establish nursery green with soil structure and grass species as existing on course.
2) Maintain according to greens maintenance specifications.
3) Following removal of sod replace soil and re-seed.
b. Tees and Fairways.
1) Establish tee and fairway nursery with soil structure and grass blend as existing on the course.
2) Maintain according to tee and fairway maintenance specifications or
as approved by County.
3) Following removal of sod replace and re-seed or stolonize.
6. Maintain all golf course accessory equipment in clean, safe, functioning conditions at all times, replacing equipment and/or materials as necessary, including but not limited to the
following:
a. Signs
b. Tee benches
c. Tee markers
d. Ball washer, including towels and soap
e. Out-of-bounds markers
f. Distance markers
g. Greens, flags, and cups (annually)
h. Green flag poles
i. Practice green markers and cups (annually)
j. Trash receptacles
k. Shoe spike brushes
l. Sand trap rakes; access and maintenance
7. Maintain access and maintenance roadways and their slopes free of brush, weeds and debris at all times.
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8. Remove all litter daily from golf course grounds and driving range. Remove all trash and debris resulting from golf course maintenance as it occurs. Clean, repair and replace trash
receptacles as necessary to maintain clean, safe, and sanitary conditions at all times.
9. Maintain the entire irrigation system, including pump station, gate valve assemblies, main lines, electric valves, lateral lines, sprinkler heads, controllers, water supply lines in good repair, functioning as designed by manufacturer and conforming to all related codes and regulations at all times.
10. Irrigate all turf and landscape planting as necessary to maintain healthy growth at
all times.
11. Maintain all shrub, ground cover planting and lawn areas in a manner to promote proper healthy growth and an aesthetically pleasing appearance and weed free condition at all times.
12. Maintain all trees in safe, healthy and aesthetically pleasing condition at all times,
keeping adjacent turf mowed and trimmed to the trunks of trees on golf course.
13. Sand traps to be raked as needed and kept edged and in weed-free condition at all times, replacing sand and rakes as necessary.
14. Take whatever preventative steps are necessary to protect all slope areas from
erosion, fire, and rodent damage at all times.
15. Control rodent and other animal pests as necessary to prevent erosion, interference with play and destruction of plantings on golf course property at all times.
16. Maintain water hazards at proper depth and free of algae and debris.
17. Maintain flow lines, swales, sub-surface drainage systems in clear, weed free and
proper functioning condition at all times.
18. Observe all legal requirements and safety regulations in the use and storage of chemicals, hazardous materials, supplies and equipment at all times.
19. Maintain golf maintenance storage building and yard in a clean, orderly, and safe condition at all times, conforming to all applicable laws and regulations.
20. Protect golfers from injury and the golf course from damage in periods of frost,
rainy weather, and other unusual conditions at all times.
21. Maintain exterior drinking water stations in a clean, sanitary and safe operating condition.
22. Maintain bridge abutments and approaches in safe, stable condition at all times.
23. Maintain walkways, handrails on walkways, and cart paths in a graded, smooth
surface, clean edged, safe and weed free conditions at all times.
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24. Maintain all fencing, netting and fence lines in safe, secure and aesthetically pleasing conditions at all times.
25. Maintain all roads, parking lots and driveways within said premises in clean, safe
and weed free condition at all times with all paved surfaces in good repair.
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