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Resolution No. 2010-164RESOLUTION NO. 2010-164 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF VERNON APPROVING AND RATIFYING THE EXECUTION OF A FIRST AND SECOND AMENDMENT TO AMENDED AND RESTATED PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS BY AND BETWEEN THE CITY OF VERNON AND RENU RESOURCES, LLC, RELATING TO THE PURCHASE OF LAND FOR POTENTIAL DEVELOPMENT OF RENEWABLE RESOURCES WHEREAS, the City of Vernon (the "City") is a chartered municipal corporation 'of the State of California that owns and operates a system for the generation, purchase, transmission, distribution and sale of electric capacity and energy; and WHEREAS, on August 12, 2008, the City Council of the City of Vernon adopted Resolution No. 9689 approving the Purchase and Sale Agreement and Joint Escrow Instructions dated August 13, 2008 (the "Original Agreement"), with ReNu Resources, LLC for the purchase of property in Kern County in the area known as the Tehachapi Wind Resource Area (the "Wind Property") for the potential development of renewable resources; and WHEREAS, on September 8, 2008, the City Council of the City of Vernon adopted Resolution No. 97.09, which approved and ratified the execution of a First Amendment to the Original Agreement dated August 28, 2008 and a Second Amendment to the Original Agreement dated September 4, 200.8;.and WHEREAS, on October 6, 2008, the City Council of the City of Vernon adopted Resolution No. 9734, which approved and ratified the execution of a Third Amendment to the Original Agreement; and WHEREAS, on February 23, 2009, the City Council of the City of Vernon adopted Resolution No. 9862, which approved the Amended and Restated Purchase and Sale Agreement and Joint Escrow Instructions (the "Agreement") dated as of October 8, 2008, which amended and restated the Original Agreement; and WHEREAS, the former City Administrator executed a First Amendment to the Agreement dated October 12, 2009 to delay the expiration of a transmission easement agreement benefitting the Wind Property; and WHEREAS, the City desires to enter into a Second Amendment to the Agreement to further extend the expiration of the transmission easement agreement and add a one-time right to designate an additional transmission easement route benefitting the Wind Property; and WHEREAS, the City desires to approve and ratify the actions of the City Administrator in executing the First Amendment to.the Agreement and to approve the Second Amendment to the Agreement. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF VERNON AS FOLLOWS: SECTION 1: The City Council of the City of Vernon does hereby find and determine that the recitals contained hereinabove are true and correct. SECTION 2: The City Council of the City of Vernon hereby approves, and ratifies the execution of, the First Amendment to the Agreement dated October 12, 2009, a copy of which is attached hereto as Exhibit A. SECTION 3: The City Council of the City of Vernon approves, and hereby authorizes the City Administrator to execute, a Second Amendment to the Agreement, in substantially the form attached hereto as Exhibit B, and the City Clerk, or Deputy City Clerk, is hereby authorized to attest thereto SECTION 4: The City Council of the City of Vernon hereby 2 authorizes the City Administrator, or his designee, to take whatever action is deemed necessary or desirable for the purpose of implementing and carrying out the purposes of this Resolution and the transactions herein approved or authorized. SECTION 5: The City Clerk of the City of Vernon shall certify to the passage, approval and adoption of this resolution, and the City Clerk of the City of Vernon shall cause this resolution and the City Clerk's certification to be entered in the File of Resolutions .of the Council of this City. APPROVED AND ADOPTED this 15th day of November, 2010. Name: Hilario Gonzales Title: Mayor ayo ATTE : Wil and Ya a c , City Clerk 3 STATE OF CALIFORNIA ) ss COUNTY OF LOS ANGELES ) I, Willard G. Yamaguchi, City Clerk of the City of Vernon, do hereby certify that the foregoing Resolution, being Resolution No. 2010-164, was duly passed, approved and adopted by the City Council of the City of Vernon at a regular meeting of the City Council duly held on Monday, November 15, 2010, and thereafter was duly signed by the Mayor or Mayor Pro-Tem of the City of Vernon. Executed this day of November, 2010, at Vernon, California. Willar G. mag i, City Clerk (SEAL) 3' 7Y , • .. Execution Version 4305 Santa Fe Avenue, Vernon, California 90058 Telephone (323) 583-8811, October 12 2009 ReNu Resources,'LLC c/o Renewable Resources Group 5700'Wilshre Boulevard, Suite 330' Los Angeles, CA 90036 Attn: J. Ari Swiller Re: Amendment to that certain Amended and Restated Purchase and Sale A reement and Joint Escrow Instructions dated as of October 8 2008 the "A&R Purchase A_gieemen between the City, of Vernon -a California chartered city, and ReNu Resources LLC a Delaware limited liability company Dear Mr. Swiller: Reference is hereby made to the A&R Purchase Agreement. Capitalized terms used herein but not otherwise'' defined have the meanings assigned to them in the A&R Purchase Agreement: This letter is to confirm our mutual agreement to amend the A&R Purchase Agreement to delay the expiration of the WL General Transmission Easement Agreement. Accordingly, the last sentence of Section 1(d)(i) of the A&R Purchase Agreement is modified as follows, where strike -through indicates deleted text and underline indicates new text: If the WL Specific Transmission Easement Agreement (as defined below) has not been executed and recorded on or before the f}r-A second anniversary of the Closing Date for reasons other than Seller's default, the WL General Transmission Easement Agreement shall expire and be: of no further force or effect, and Buyer shall execute, acknowledge where appropriate and deliver any reasonable documents submitted by Seller to release the WL General Transmission Easement Agreement. For the same purpose, the Parties further agree to enter into and record the First Amendment to Transmission Easement attached hereto as Exhibit A as soon as is reasonably practicable. LA\2022733.2 Exclusively Industrial This letter agreement shall serve as a valid amendment of the A&R Purchase Agreement pursuant to Section 17 thereof. Except as expressly set forth herein, all other terms and conditions of the A&R Purchase Agreement remain in full force and effect and continue to be applicable. This letter agreement may be executed in any number of counterparts, each of which when executed and delivered shall be deemed to be an original and all of which counterparts taken together shall constitute one and the same instrument. This letter agreement may be executed by the exchange of signature pages through electronic mail or facsimile transmission. Please acknowledge your agreement to this letter agreement by countersigning and returning it to the me. Upon effectiveness of this letter agreement, all references in the A&R Purchase Agreement shall mean the A&R Purchase Agreement as amended by this letter agreement. Please feel free to contact me if you have any questions regarding the foregoing. 2 LA\2022733.2 Very truly yours, Donal O'Callaghan Administrator The City of Vernon cc: Laurence S. Weiner; Esq., City Attorney Document Control David B. Rogers, Esq. c/o CIM Group, Inc. 6922 Hollywood Blvd., Suite 900 Los Angeles, California 90028 Attention: General Counsel Facsimile No: (310) 496-2887 CIM Group, Inc. 6922 Hollywood Blvd., Suite 900 Los Angeles, California 90028 Attention: Jennifer Gandin Facsimile No: (323) 860-4901 O'Melveny & Myers LLP 400 South Hope Street Los Angeles, CA 90071 Attention: Greg Thorpe, Esq. Facsimile No: (213) 430-6407 3 LA\2022733.2 Agreed to and Acknowledged as of October 12-, 2009: ReNu Resources, LLC a Delaware limited liability company 'By: CIM/Onyx Ranch Manager, LLC Its Managing Member By: Renewable Resources Group Holding Company, Inc. Its Operating Member By: J. Ari leer Pres' Acknowledgement Page to Amendment Letter Agreement to A&R Purchase Agreement Exhibit A . First Amendment to Transmission Easement A-1 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: The City of Vernon 4305 Santa Fe Avenue Vernon, California 90058 Attention: Larry Wiener, Esq., City Attorney Kern County Recorder Conforrined Copy OCT 2 3 7009 Document I FIRST AMENDMENT TO TRANSMISSION EASEMENT Execution Version 7cF67 This FIRST AMENDMENT TO TRANSMISSION EASEMENT (this "Amendment") is entered into as of October JQ, 2009 by and between'ReNu RESOURCES, LLC, a Delaware limited liability company ("Grantor") and the CITY OF VERNON, a California chartered city ("Grantee"). Grantor and Grantee are referred to herein sometimes individually as a "Party" and collectively as the "Parties." RECITALS A. The Parties entered into that certain Transmission Easement dated as of October 16, 2008 and recorded by the County Recorder of Kern County, California on October 17, 2008 as document number 0208165193 (the "Easement Agreement"). B. The Parties desire to amend the Easement Agreement to extend the term as set forth herein. NOW, THEREFORE, the Parties agree as follows: AGREEMENT ARTICLE 1. AMENDMENT 1.1 Extension of Term. Section 3 of the Easement Agreement is hereby deleted in its entirely and replaced with the following: 3 Term. (a) If the execution and recordation of the Amended and Restated Transmission Easement (the "Transmission Selection") has not been completed on or before October 17, 2010 for reasons other than Grantor's default under the PSA, this Easement Agreement shall automatically expire and be of no further force or effect, and to confirm the same, Grantee shall execute, acknowledge where appropriate and deliver any reasonable documents submitted by Grantor to release this Easement Agreement. LA\2022787.3 (b) Seller agrees to give Buyer prompt written notice if it intends to sell or market for sale all or any portion of the Transmission Easement Area to an entity not affiliated with Seller. Seller may accelerate the deadline for Buyer to make the Transmission Selection with respect to all or portions of the Transmission Easement Area as follows: If, from time to time, Seller and an entity not affiliated with Seller enter into a letter of intent or other similar written arrangement ("LOI") setting forth the property to be sold (the "Proposed Property") and the price and the other principal terms of such sale (a "Proposed Sale") and granting the buyer exclusivity, then if - Seller desires to accelerate such deadline, Seller shall give a copy of the LOI to Buyer along with a statement that Seller is accelerating Buyer's deadline to make the Transmission Selection with respect to the Proposed Property (an "Acceleration Notice"). Following Buyer's receipt of an Acceleration Notice, Buyer may make the Transmission Selection with respect to all or portions of the Proposed Property (consistent with the standards in this Easement Agreement) not later than sixty (60) days after its receipt of the Acceleration Notice. If Buyer does not timely make the Transmission Selection with respect to any portion of the Proposed Property (the "Excluded Property"), then in connection with the sale of the Excluded Property, Buyer shall execute such documents in recordable form as are reasonably requested by Seller to evidence that the Excluded Property is not included within the Transmission Easement Area. This paragraph shall terminate upon the earlier of Buyer making the Transmission Selection or October 18, 2010. ARTICLE 2. MISCELLANEOUS 2.1 Reference to Agreement. Any reference to the Easement Agreement shall mean a reference to the Easement Agreement as amended by this Amendment. 2.2 Governing_ La . This Amendment shall be governed by and construed in accordance with the laws of the State of California. 2.3 Counterparts. This Amendment may be executed in one or more counterparts, each of which is an original, but all of which together constitute one and the same instrument. 2.4 Full Force and Effect. Each Party confirms that the Easement Agreement is in full force and effect and remains abinding obligation of the Parties. [Signature pages follows] 2 LA\2022787.3 IN WITNESS WHEREOF, the Parties have executed this First Amendment to the Transmission Easement as of the date first above written. GRANTOR: ReNu RESOURCES, LLC a Delaware limited liability. company By: CIM/Onyx Ranch Manager, LLC Its Managing Member By: Renewable Resources Group Holding Company, Inc. Its Operating Member By: J. ' iller Pr dent GRANTEE: AFFIRMED: CITY OF VERNON CITY CLERK a California chartered city By: By: Donal O' Callaghan Name: City Administrator I City Clerk Signature Page to First Amendment to Transmission Easement IN WITNESS WHEREOF, the Parties have executed this First Amendment to the Transmission Easement as of the date first above written. GRANTOR: ReNu RESOURCES, LLC a Delaware limited liability company By: CIM/Onyx Ranch Manager, LLC Its Managing Member' By: Renewable Resources Group Holding Company, Inc. Its Operating Member By: J. Ari Swiller President GRANTEE: CITY OF VERNON a California chartered city Donal O'Callaghan City Administrator AFFIRMED: CITY CLERK By: Name: City Clerk Signature Page to First Amendment to Transmission Easement State of California ) County ofZ4>A Y/ems ) On /�57 �S , 200_?,, before me, i iyay itil , a Notary Public. nersnnally annearerl who proved to me on the basis of satisfactory evidence to be the person(.whose name( is/= subscribed to the within instrument and acknowledged to me that he/slkeexecuted the same in his/hen4ieir'authorized capacity(i ), and that by his/heF41wir signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNE d and official seal. Signat ,e r'Gir� ���� (Seal) DIANA VILLALBA Commtasion.#► 1$56885 d Notary Public • California Los Angeles County N! Comm. E ires Jul 6, 2013 ------------- State of California County of On , 200_, before me, , a Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) State of California County of ) On Notary Public, personally appeared 200_, before me, , a who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) State of California ) County of Ge. ) On ,^ �h�v i5r , 2001�, before me, �gitGlelga Notary Public, personally appeare 6 v, who proved to me on the basis of satisfactory evidence to b he 'person(w) whose name($) is/afe- subscribed to the within instrument and acknowledged to me that he/shy executed the same in his/hen4heir authorized capacity(ies), and that by his/hel;4helir signature(e) on the instrument the perso*), or the entity upon behalf of which the persons) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS Mh and o cial Signature (Seal) 1;MMUELA`GIRON Commission # 1611388 Notary Public . Cpllfomlo ` Los Angeles County My Comm. Expires Nov 4, 201 EXHIBIT B SECOND AMENDMENT TO AMENDED AND RESTATED PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS This SECOND AMENDMENT TO AMENDED AND RESTATED PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this "Amendment") 'is entered into as of October 17, 2010, by and between ReNu RESOURCES, LLC, a Delaware limited liability company ("ReNu" or "Seller"), and the CITY OF VERNON, a California chartered city ("Vernon" or "Buyer"). Seller and Buyer are 'referred to herein sometimes individually as a "PAI:Vand collectively as the "Parties." RECITALS A. Vernon entered into that certain amended and restated purchase and sale agreement dated as of October 8, 2008 (the "Original PSA"), with ReNu Resources, LLC ("ReNu"), a memorandum of which was recorded by the County Recorder of Kern County on October 17, 2008 as document number 0208165198. The Original PSA was amended pursuant to that certain letter agreement dated October 12, 2009 by and between Vernon and ReNu (as amended from time to time; the "PSA"). Capitalized terms used -herein and not otherwise defined shall have the meanings set forth in the PSA. B. The Parties desire to amend the PSA as set forth more particularly below. NOW, THEREFORE, the Parties agree as follows: .AGREEMENT ARTICLE 1'. AMENDMENT 1.1 Extension of Term. In order to extend the deadline for executing and recording the WL Specific Transmission Easement Agreement, the last sentence of Section .1(d)(i) of the PSA is hereby modified as follows, where strike -through indicates deleted text and underline indicates new text: If the WL Specific Transmission Easement Agreement (as defined. below) has not been executed and recorded on or before the seeen -.versafy of the Closing Pat December 1, 2010 for reasons other than Seller's default, the WL General Transmission Easement Agreement shall expire and be of no further force or effect, and Buyer shall execute, acknowledge where appropriate and deliver any reasonable documents submitted by Seller to release the WL General Transmission Easement Agreement. IS LA\2141948.6 1.2 Amendments to Specific Easement Agreements. In order to permit Buyer to amend the WL Specific Transmission Easement and the WL Specific. Miscellaneous Easement, the PSA is amended as follows: (a) Section l (d)(iii) of the PSA is hereby amended by adding the heading "(A)" prior to the first sentence and adding the following after the existing paragraph: (B) From and after the recording of the WL Specific Transmission Easement, Buyer shall have a one-time right to designate an additional route for the WL Specific Transmission Easement 'for interconnection with any Transmission Owner (the "Additional Transmission Easement Route"). The Additional Transmission Easement Route is, intended to facilitate the development by Buyer of separate wind projects upon the Wind Land and shall be in addition to any existing WL Specific Transmission Easement Route already selected by Buyer. Upon exercise of this right by Buyer and subject to Seller's approval, which approval shall not be unreasonably withheld, Seller shall amend the WL Specific Transmission Easement Agreement to reflect the additional route selected by Buyer. Buyer shall reimburse Seller for any reasonable, out- of-pocket, third party costs incurred by Seller in connection with documenting and analyzing any .requested amendment. to the WL Specific Transmission Easement Agreement in accordance with this clause (iii)(B). (b) Section 1(d)(v) of the PSA is deleted in its entirety and replaced with the following: (v) Upon December 31, 2012, Buyer's right to designate an alternate transmission route for the WL Specific Transmission Easement shall terminate and Buyer shall, upon request -of Seller, release and reconvey the WL General Transmission Easement - Agreement in its entirety. (c) The following new Section 1(e)(v) shall be added to the PSA: (v) From time to time after the recording the of the WL Specific Transmission Easement until December 31, 2012, Buyer shall have the right to designate additional locations for the WL Miscellaneous Easements (the "Additional Miscellaneous Easement Locations"). The Additional Miscellaneous Easement Locations are intended to facilitate the development by Buyer of separate wind projects upon the Wind Land and shall be in addition to the existing WL Miscellaneous Easements already selected by Buyer. Upon exercise of this right by Buyer and subject to Seller'-s approval, which approval shall not be unreasonably 2 LA\2141948.6 withheld, Seller shall amend the WL Specific Miscellaneous Easement Agreement to reflect the additional locations selected by Buyer. Buyer shall reimburse Seller for any reasonable, out-of-pocket, third party costs incurred by Seller in connection with documenting and analyzing any requested amendment to the WL Specific Miscellaneous Easement Agreement in accordance with this clause (v). 1.3 Audit. Pursuant to Annex,A, Paragraph (e), of the PSA, Buyer acknowledges that Seller has elected to audit the records of Buyer relating to the Adjusted Cash Position for the fiscal year ending June 30, 2010, and Buyer shall fully cooperate with that audit. ARTICLE 2. MISCELLANEOUS 2.1 Amended Agreement. Any reference to the PSA shall mean a reference to the PSA as amended by this Amendment. Except as expressly set forth herein, the PSA, shall remain unchanged and in full force and effect. The amendments set forth herein are limited to the specifics hereof and shall not operate as a consent to any further or other matter under the PSA. This Amendment, and terms and provisions hereof, constitute the entire agreement among the parties pertaining to the subject matter hereof and supersedes any and all prior or contemporaneous amendments or discussions relating to the subject matter hereof. 2.2 Governing Law. This. Amendment shall be governed by and construed in accordance with the laws of the State of California. 2.3 Counterparts. This Amendment may be executed in one or more- counterparts, each of ,which is an original, but all of which together constitute one and the same instrument. Delivery of an executed counterpart of this Amendment by telefacsimile or other electronic method shall be equally as effective as delivery . of an original executed counterpart of this Amendment. i E 2.4 'Full Force and Effect. Each Party confirms that the Easement Agreement. is in full force and effect and remains a binding obligation of the Parties. [Signature pages follows] f .3 - LA\2141948.6 IN WITNESS WHEREOF, the.Parties have executed this Second Amendment to Amended and Restated Purchase and Sale Agreement and Joint Escrow Instructions as of the date first above written. SELLER: ReNu RESOURCES, LLC a Delaware limited liability company, By; CIM/Onyx Ranch Manager, LLC Its Managing Member By: Renewable Resources Group Holding Company, Inc. Its Operating Member By: BUYER: CITY OF VERNON a California chartered city By: Mark Whitworth City Administrator LA\2141948.6 AFFIRMED: CITY CLERK By: Name: City Clerk OFFICE OF THE CITY CLERK 4305 Santa Fe Avenue, Vernon, California 90058 Telephone (323) 583-8811 November 17, 2010 Peter Jasinski Latham & Watkins LLP 355 South Grand Avenue Los Angeles, CA 90071 Re: 2nd Amendment to ReNu Purchase Agreement Dear Mr. Jasinski: Please find enclosed one fully executed original amendment, approved by the City Council of the City of Vernon on November 15, 2010, through Resolution No. 2010-164. If you have any questions regarding this matter, please call Mr. Mark Whitworth at (323) 583-8811 ext. 398. Very4ruly yours, WILLARD G. � GU-(�Al City Clerk v WY:dj c: Mark Whitworth Rory Burnett Resolution No. 2010-164 Agreement No. 10-084 Excfusivefy Industriaf SECOND AMENDMENT TO AMENDED_ AND RESTATED PURCHASE AND- SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS This SECOND AMENDMENT TO AMENDED AND RESTATED PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this "Amendment") 'is entered_ into as of October 17, 2010, by and between ReNu RESOURCES, LLC, a Delaware limited liability company ("ReNu" or "Seller"), and the CITY OF VERNON, a California chartered city ("Vernon" or "Buyer"). Seller and Buyer are 'referred to herein sometimes individually as a "EqW�" and collectively as the "Parties." RECITALS A. Vernon entered into that certain amended and restated purchase and sale agreement dated as of October 8, 2008 (the "Original PSA"), with ReNu Resources, LLC ("ReNu"), a memorandum of which was recorded by the County Recorder of Kern County on October 17, 2008 as document -number 0208165198. The Original PSA was amended pursuant to that certain letter agreement dated October 12, 2009 by and between Vernon and ReNu (as amended from time to time, the "PSA"). Capitalized terms used .herein and not otherwise defined shall` have the meanings set forth in the PSA. B. The Partiesdesire to amend the PSA as set forth more particularly below. NOW, THEREFORE, the Parties agree as follows: AGREEMENT ARTICLE 1. AMENDMENT 1.1 Extension of Term. In order to extend the deadline for executing and recording the WL Specific Transmission Easement Agreement, the last sentence of Section 1(d)(i) of the PSA is ,hereby modified as follows, where strike -through indicates deleted text and underline indicates new text: If the WL Specific Transmission Easement Agreement (as defined. below) has not been executed and recorded on or before the. See'e-nd- ffllwmiversap; of the Glesi g Pat December 1, 2010 for reasons other than Seller's default, the WL General Transmission Easement Agreement shall expire and be of no further force or effect, and Buyer shall execute, acknowledge where appropriate and deliver any reasonable documents submitted by Seller to release the WL General Transmission Easement Agreement. I . LA12141948.6 1.2 Amendments to Specific Easement Agreements. In order to permit Buyer to amend the WL Specific Transmission Easement and the WL Specific Miscellaneous Easement, the PSA is amended as follows: (a) Section 1(d)(iii) of the PSA is hereby amended by adding the heading "(A)" prior to the first sentence and adding the following after the existing paragraph: (B) From and after the recording of the WL Specific Transmission Easement, Buyer shall have a one-time right to designate an additional route for the WL Specific Transmission Easement for interconnection. with any Transmission Owner (the "Additional Transmission Easement Route"). The Additional Transmission Easement Route is intended to facilitate the development by Buyer of separate wind projects upon the Wind Land and shall be in addition to any existing WL Specific Transmission Easement'Route already selected by Buyer. Upon exercise of this right by Buyer and subject to Seller's approval, which approval shall not be unreasonably withheld, Seller shall amend the WL Specific Transmission Easement Agreement to reflect the additional route selected by Buyer. Buyer shall reimburse Seller for any reasonable, out- of-pocket, third parry costs incurred by Seller in connection with documenting and analyzing any .requested amendment. to the WL Specific Transmission Easement Agreement in accordance with this clause (iii)(B). (b) Section 1(d)(v) of the PSA is deleted in its entirety and replaced with the following: (v) Upon December 31, 2012, Buyer's right to designate an alternate transmission route for the WL Specific Transmission Easement shall terminate and Buyer shall, upon request -of Seller, release and reconvey the WL General Transmission Easement - Agreement in its entirety. (c) The following new Section 1(e)(v) shall be added to the. PSA: (v) From time to time after the recording the of the WL Specific Transmission Easement until December 31, 2012, Buyer shall have the right to designate additional locations for the WL Miscellaneous Easements (the "Additional Miscellaneous Easement, Locations"). The Additional Miscellaneous Easement Locations are intended to facilitate the development by Buyer of separate wind projects upon the Wind Land and shall be in addition to the existing WL Miscellaneous Easements already selected by Buyer. Upon exercise of this right by Buyer and subject to Seller'"s• approval, which approval shall not be unreasonably 2 LA\2141948.6 r withheld, Seller shall amend the WL Specific Miscellaneous Easement Agreement to reflect the additional locations selected by Buyer. Buyer shall reimburse Seller for any reasonable, out-of-pocket, third party costs incurred by Seller in connection with documenting and analyzing any requested amendment to the WL Specific Miscellaneous Easement Agreement in accordance with this clause (v). 1.3 Audit. Pursuant to Annex,A, Paragraph (e), of the PSA, Buyer acknowledges that Seller has elected to audit the records of Buyer relating to the Adjusted Cash Position for the fiscal year ending June 30, 2010, and Buyer shall fully cooperate with that audit. ARTICLE 2. MISCELLANEOUS 2.1 Amended Agreement. Any reference to the PSA shall' mean a reference to the PSA as amended by this Amendment. Except as expressly set forth herein, the PSA.shall remain unchanged and in full force and effect. The amendments set forth herein are limited to the specifics hereof and shall not operate as a consent to any further or other matter under the PSA. This Amendment, and terms and provisions. hereof, constitute the entire agreement among the parties pertaining to the subject matter hereof and supersedes any and all prior or contemporaneous amendments or discussions relating to the subject matter hereof. 2.2 Governing. Law. This. Amendment shall be governed by and construed in accordance with the laws of the State of California. 2.3 Counterparts. This Amendment may be executed in one or more counterparts, each of .which is an original, but all of which together constitute one and the same instrument. Delivery of an executed counterpart of this Amendment by telefacsimile or other electronic method shall be equally as effective as delivery of an original executed counterpart of this Amendment. E 2.4 'Full Force and Effect. Each Party confirms that •the Easement Agreement is in full force and effect and remains a binding obligation of the Parties. [Signature pages follows] F li 3 LA\2141948.6 • l IN WITNESS WHEREOF, tlie.Parties have executed this Second Amendment to Amended and Restated Purchase and Sale Agreement and Joint Escrow Instructions as of the date first above written. SELLER: ReNu RESOURCES, LLC a Delaware limited liability company. By: CIM/Onyx Ranch Manager, LLC Its Managing Member By: Renewable Resources Group Holding Company, Inc, Its Operating Member By: -----�—� J Ar' Swiller r ident BUYER: AFFIRMED: CITY OF VERNON CITY CLERK a California chartered city By: _ -- �&jt By Mar Whitworth N me: Willar G Ya a uchi City Administrator City Clerk LA\2141948.6 STAFF REPORT City Attorney TO: Honorable Mayor and City Council FR: Willard G. Yamaguchi, Interim City Attorney DA: November 10, 2010 RE: Renu Resources, Inc. The City of Vernon entered into a Purchase and Sale Agreement and Escrow Instructions dated August 13, 2008 for the purchase of property in Kern County for the potential development of renewable resources. The Agreement was amended three times, and then amended and restated to consolidate the Agreement and all of the amendments. Under the Agreement, the City of Vernon has the right to designate transmission easement benefitting the property. A First Amendment to the amended and restated Agreement was executed to extend.the deadline for designating the easement routes. A Second Amendment to the amended and restated Agreement has been negotiated to further extend the deadline and add a right to designate additional transmission routes. These Resolutions approve both amendments to the amended and restated Agreement, ratify the execution of the First Amendment and authorize the execution of the Second Amendment. Recommendation We recommend that the Council approve both amendments to the amended and restated Agreement, ratify the execution of the First Amendment and authorize the execution of the Second Amendment.