BLP PARTNERSHIP RIGHT OF FIRST REFUSAL

Section 1.2 Purchase Price Under Refusal Right. The Purchase Price of the Development, if the City exercises its Refusal Right shall be an amount equal to the bona fide offer made to the Developer by the potential purchaser which price shall account for any equity the Developer may have accrued prior to the City's exercise of the Refusal Right. Section 1.3 Exercise of Refusal Right. Subject to the terms and restrictions of any financing arrangements secured by a deed of trust encumbering the Leasehold Estate, including but not limited to, any approvals required thereunder, the Refusal Right may be exercised by the City by (a) giving prior written notice of its intent to exercise the Refusal Right, as applicable, to the Developer in compliance with the requirements of this Section (the "Notice of Intent"), and (b) complying with the closing requirements of Section 1.4 of this Agreement. Any such notice of intent to exercise the Refusal Right must be given within thirty (30) days after the City's discovery of the Developer's intent to make a prohibited Transfer and before title has passed to the Developer's transferee. In either case, the Notice of Intent shall specify a closing date within ninety (90) days immediately following the date of exercise. If the foregoing requirements are not met as and when provided in this Agreement, the Refusal Right, as applicable, shall expire and be of no further force or effect. Section 1.4 Closing. Within ten (10) business days after exercise of the Refusal Right the City shall open escrow for purchase of the Development. The Developer shall bear the costs of any transfer tax, and the City shall bear the cost of any policy of title insurance. Taxes shall be prorated as of the date of close of escrow. Costs of escrow (including any document preparation and recording fees) shall be divided equally between the Developer and the City. The Development shall be conveyed by grant deed subject to the terms and restrictions of any financing arrangements secured by a deed of trust encumbering the Leasehold Estate, including but not limited to, any approvals required thereunder. The Developer and the City may execute any further escrow instructions consistent with this Agreement that may be required by the escrow holder. Section 1.5 Miscellaneous. (a) This Agreement shall be governed by the laws of the State of California and may be executed in counterparts or counterpart signature pages, which together shall constitute a single agreement. (b) The terms of this Agreement shall bind and benefit the heirs, legal representatives, successors and assigns of the Parties. (c) This Agreement is made and entered into for the sole protection and benefit of the Parties and their permitted successors and assigns. No other persons or entities shall have any right of action under or be considered third party beneficiaries of this Agreement. 2 144\105\159109.12