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City Council Meeting - Council - Agenda - 09/20/2005
AG EN DA - City of Kent City Council Meeting Agenda September 20, 2005 i Mayor Jim White Deborah Ranniger, Council President Councilmembers Tim Clark Debbie Raplee Ron Harmon Les Thomas Julie Peterson Bruce White KENT W A S H I N G T O N City Clerk's Office 440 KENT CITY COUNCIL AGENDAS KENT September 20, 2005 W^s 1.N G r O. Council Chambers MAYOR: Jim White COUNCILMEMBERS• Deborah Ranmger, President Tim Clark Ron Harmon Julie Peterson Debbie Raplee Les Thomas Bruce White COUNCIL WORKSHOP AGENDA 5:30 p.m. Item Description Speaker Time 1. Neighborhood Traffic Control Plan Review Public Works Staff 20 min 2. Railroad Quiet Zones Public Works Staff 10 min 3 Aquatic/Facility Recreation Study Update Parks Staff 20 min COUNCIL MEETING AGENDA 7:00 p.m. 1. CALL TO ORDER/FLAG SALUTE 2. ROLL CALL 3. CHANGES TO AGENDA A. FROM COUNCIL, ADMINISTRATION, OR STAFF B. FROM THE PUBLIC- Citizens may request that an item be added to the agenda at this time. Please stand or raise your hand to be recognized by the Mayor. 4. PUBLIC COM[�UNICATIONS 1L J g d None �} /tf%CE ��D r �7V1 C�!1 fS TD 5. PUBLIC HEARINGS A. 2006 Annual Budget(First Hearing) B 2006-2011 Capital Improvement Plan (First Hearing) 6. CONSENT CALENDAR A. Minutes of Previous Meeting -Approve B Payment of Bills- Approve C. S. 277th Street Trail, Block Wall Project-Accept as Complete D. Washington State Department of Transportation Revised Temporary Easement Agreement for Riverview Park-Authorize E. West Valley Highway at-2 12th Rezone Ordinance - Adopt F. Daljit Cove Rezone Ordinance-Adopt (Continued on Back) COUNCIL MEETING AGENDA CONTINUED G. 228th Street Corridor Qwest and Puget Sound Energy Agreements — Authorize H. Lease Agree e t for Cell Tow r�t�Pump Station #5 —Accept and Amend Budget CXUA JM au *CID 7. OTHER BUSINESS A. Municipal Lot Block Development Agreements and Resolution—Authonze and Adopt 8. BIDS A. LID 353: S. 228th Street Extension Wetland Mitigation Planting 9. REPORTS FROM STANDING COMMITTEES, STAFF AND SPECIAL COMMITTEES n� 10. CONTINUED COMMUNICATIONS Goa ri° I � 11. EXECUTIVE SESSION AND AFTER EXECUTIVE SESSION A. Pending Litigation 12. ADJOURNMENT NOTE: A copy of the full agenda packet is available for perusal in the City Clerk's Office and the Kent Library The Agenda Summary page and complete packet are on the City of Kent web site at www.ci kent wa us An explanation of the agenda format is given on the back of this page. 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A) FROM COUNCIL, ADMINISTRATION, OR STAFF B) FROM THE PUBLIC i PUBLIC COMMUNICATIONS i r 1 Kent City Council Meeting Date September 20, 2005 Category Public Hearings 1. SUBJECT: 2006 ANNUAL BUDGET (FIRST HEARING) 2. SUMMARY STATEMENT: This is the first public hearing on the 2006 budget. Input is welcome as the City begins to prepare for its 2006 budget 3. EXHIBITS: None 4. RECOMMENDED BY: Finance Director (Committee, Staff, Examiner, Commission, etc.) 5. FISCAL IMPACT Expenditure? N/A Revenue? N/A Currently in the Budget? Yes No If no. Unbudgeted Expense. Fund Amount $ Unbudgeted Revenue: Fund Amount $ 6. CITY COUNCIL ACTION: A. Councilmember moves, Councilmember seconds to close the public hearing. B. Councilmember moves, Councilmember seconds DISCUSSION: ACTION. Council Agenda Item No 5A Kent City Council Meeting Date September 20, 2005 Category Public Hearings 1. SUBJECT: 2006-2011 CAPITAL IMPROVEMENT PLAN (FIRST HEARING) 1 2. SUMMARY STATEMENT: This is the first public hearing on the 2006-2011 Capital Improvement Plan. Public input is welcome. 3. EXHIBITS: None 4. RECOMMENDED BY: Finance Director (Committee, Staff, Examiner, Commission, etc.) 5. FISCAL IMPACT Expenditure? N/A Revenue? N/A Currently in the Budget? Yes No If no: Unbudgeted Expense: Fund Amount $ Unbudgeted Revenue: Fund Amount $ 6. CITY COUNCIL ACTION: A. Councilmember moves, Councilmember seconds to close the public hearing. B. Councilmember moves, Councilmember seconds DISCUSSION: ACTION: Council Agenda Item No. 5B CONSENT CALENDAR 6. City Council Action Councilmember_ moves, Councilmember seconds to approve Consent Calendar Items A through4 Discussion Action Yr 6A. Approval of Minutes. Approval of the minutes of the regular Council meeting of September 6, 2005. 6B. Approval of Bills. Approval of payment of the bills received through July 16 and paid on July 31 after auditing by the Operations Committee on August 16, 2005. Approval of checks issued for vouchers- Date Check Numbers Amount 7/31/05 Wire Transfers 2121-2136 $1,223,415 56 7/31/05 PrePays& 581085 1,572,700 43 7/31/05 Regular 581715 2,644,662 07 5/16/05 Use Tax Payable 2,165 59 $5,442,943 65 Approval of payment of the bills received through August 15 and paid on August 15 after auditing by the Operations Committee on August 16, 2005 Approval of checks issued for vouchers- Date Check Numbers Amount 8115105 Wire Transfers 2137-2152 $1,315,824 05 8/15/05 PrePays & 581716 1,146,555 27 8/15/05 Regular 582355 1,761,713 04 5/16/05 Use Tax Payable 1,49856 $4,225,590 92 Approval of checks issued for payroll for July 16 through July 31 and paid on August 4, 2005: Date Check Numbers Amount 7/25/05 Interim Check 285270 S 623 48 Interim Payroll S 623.48 8/5/05 Checks 285271-285598 274,894 15 8/5/05 Advices 183414-184099 1,260,995 51 $1,535,889 66 Council Agenda Item No. 6 A-B i KEN T Kent City Council Meeting w"5"'"`r0 September 6, 2005 The regular meeting of the Kent City Council was called to order at 7.00 p in. by Mayor White. Councilmembers present Clark, Harmon, Peterson, Ranmger, Thomas and White. Councilmember Raplee was excused from the meeting (CFN-198) CHANGES TO THE AGENDA A. From Council, Administration, or Staff. (CFN-198) Consent Calendar Item O was added, and Item N was removed Public Communications Items B, C and D were added and a property acquisition issue was added to the Executive Session. B. From the Public. (CFN-198) Continued Communications Items A through D were added at the request of audience members. PUBLIC COMMUNICATIONS A Constitution Week. (CFN-155) Mayor White read a proclamation declaring September 17- 23, 2005 as Constitution Week. Donna Bradshaw of the Lakota Chapter of the Daughters of the American Revolution accepted the proclamation iB. Emplovee of the Month. (CFN-147) Mayor White announced that Julie Romano, Accounting Technician at Kent Commons, has been selected as the September Employee of the Month C. Hurricane Katrina Victim Assistance Month. (CFN-155) The Mayor read a proclamation encouraging all citizens to provide assistance to the hurricane victims. D. Kent School District. (CFN-198) Becky Hanks acknowledged and thanked the City for their assistance. PUBLIC HEARING A. Cedar Street East of Hazel Avenue Street Vacation. (CFN-102) Resolution No. 1705 established September 6, 2005 as the public hearing date for the petition by Sean Stewart to vacate a portion of Cedar Street Charlene Anderson, Planning Manager, explained that staff has changed their recommendation from denial to approval with one additional condition. Mayor White opened the public hearing. There were no comments from the audience and CLARK MOVED to close the public hearing White seconded and the motion carried. CLARK MOVED to approve staff s recommendation of approval with five conditions of the petition to vacate a portion of Cedar Street, as referenced in Resolution No. 1705, and to direct the City Attorney to prepare the necessary ordinance upon the applicant's compliance with the conditions of approval White seconded It was noted that the Nazarene Church has been notified and has another exit. The motion then carved. CONSENT CALENDAR RANNIGER MOVED to approve Consent Calendar Items A through O, with the exception of Item N which was removed Clark seconded and the motion carried. The Mayor requested that 1 Kent City Council Minutes September 6, 2005 Item N, Montessori School Lease, be sent to the Public Works Committee and that the neighbors be notified of the Committee meeting in order to voice any concerns. CLARK SO MOVED Harmon seconded and the motion carried. A Approval of Minutes. (CFN-198) The minutes of the regular Council meeting of August 16, 2005 were approved B Approval of Bills (CFN-104) Payment of the bills received through July 16 and paid on July 31 after auditing by the Operations Committee on August 16, 2005 were approved Approval of checks issued for vouchers: Date Check Numbers Amount 7/31/05 Wire Transfers 2121-2136 $1,223,415.56 7/31/05 PrePays & 581085 1,572,700 43 7/31/05 Regular 581715 2,644,662 07 05/16/05 Use Tax Payable 2,16559 $5,442,943.65 Payment of the bills received through August 15 and paid on August 15 after auditing by the Operations Committee on August 16, 2005 were approved. Approval of checks issued for vouchers: Date Check Numbers Amount 8/15/05 Wire Transfers 2137-2152 $1,315,824 05 8/15/05 PrePays & 581716 1,146,555.27 8/15/05 Regular 582355 1,761,713.04 05/16/05 Use Tax Payable 1,498.56 $4,225,590.92 Approval of checks issued for payroll for July 15 through July 31 and paid on August 4, 2005- Date Check Numbers Amount 7/25/05 Interim Check 285270 $ 62348 8/5/05 Checks 285599-285922 259,338 50 8/5/05 Advices 194100-184784 1,226,005.29 $1,485,343 79 C. Backup System Replacement. (CFN-1155) The Mayor was authorized to sign Goods and Services Agreements and Purchase Orders with Right Systems for a replacement data backup system and installation services not to exceed $137,000 D. 2005-06 Washington Conservation Corps Sponsor Contract. (CFN-1038) The Mayor was authorized to sign the Washington Conservation Corps Sponsor Agreement, in the amount of $85,000 and direct staff to pay any expense out of the drainage operating fund 2 Kent City Council Minutes September 6, 2005 E. Amendment to Waterline Easement Agreement. (CFN-1065) The Mayor was authorized to execute the respective document(s) to amend the waterline easement to reflect the revised watermam location as described in the legal description F. Resolution Setting Hearing Date for Vacation of a Portion of 108th Avenue SE. (CFN-102) Resolution No 1708 scheduling a public hearing for October 18, 2005, on a Street Vacation Petition to vacate a portion of 1081' Avenue SE was adopted. ' G Resolution Setting Hearing Date for Vacation of a Portion of 188th Street. (CFN-102) Resolution No 1709 scheduling a public hearing for October 18, 2005, on a Street Vacation Petition to vacate a portion of South 1881" Street was adopted. H. Zoning Code Amendment—Multifamily Dwelling Units in MR-T Zones in Downtown Districts, Ordinance. (CFN-131) Ordinance No. 3759 amending Chapter 15 of the Kent City Code to allow multifamily dwelling units in the MR-T Multifamily Residential Townhouse Districts located in Downtown Districts was adopted. I. Zoning Code Amendment—Processing for Applications for Rezone, Ordinance. (CFN-131) Ordinance No. 3760 amending Chapter 12 of the Kent City Code regarding the processing of applications for rezone was adopted. J. Zoning Code Amendment— Townhouse Ownership Options in MR-T Zoning Districts, Ordinance. (CFN-131) Ordinance No 3761 amending Chapter 15 of the Kent City Code regarding ownership options in the MR-T Multifamily Residential Townhouse Districts was adopted. K. Central Avenue Sidewalk Project. (CFN-117) The Central Avenue Sidewalk project was accepted as complete and release of the retamage to Pacific Rim Construction upon standard releases from the state and release of any liens was authorized. L. Washington Traffic Safety Commission Grant. (CFN-122) The Washington Traffic Safety Commission mini-grant in the amount of$1,000.00 which will be used to purchase two (2) portable breath testers for the court and traffic school use was accepted and establishment of a budget for same was authorized. M. Bureau of Justice Assistance FY 2005 Grant. (CFN-122) The grant for$48,260 for use by the Kent Police Department to support crime investigations with the purchase of equipment, supplies and training was accepted, establishment of a budget for the same was authorized, and the Mayor was authorized to sign all agreements necessary to accept the grant. ADDED ITEM O. Excused Absence. (CFN-198) An excused absence from tonight's meeting for Councilmember Raplee was approved OTHER BUSINESS A. Zoning Code Amendment—Commercial Motor Vehicles in Residential Zoning Districts. (CFN-131) On August 15, 2005 the Planning & Economic Development Committee voted to recommend approval of amendments to Chapter 15 of the Kent City Code to limit storage and 3 Kent City Council Minutes September 6, 2005 parking of commercial motor vehicles in residential zoning districts, as recommended by the Land Use and Planning Board CLARK MOVED to send this item back to the Planning Committee. Ranniger seconded Clark noted that the meeting will be at 4.00 p.m. on September 19 in the Council Chambers and invited , interested persons to attend. The motion carried. B West Valley Highway at 212th Rezone. (Quasi-Judicial) (CFN-121) This request by Bob Fadden of Lance Mueller and Associates is to rezone 29 3 acres of property from M-1, Industrial Park, to MI-C, Industrial Park-Commercial The property is located on the northwest corner of West Valley Highway and South 212"' Street. The Kent Hearing Examiner held a Public Hearing on July 20, 2005, and issued Findings, Conclusions, and a Recommendation of approval on August 3, 2005. Damien Hooper explained the project and it was determined that there have been no ex-parte contacts by Council. Clark voiced concern about the heavy traffic at the intersection and MOVED to send the item to the Planning Committee. White seconded for discussion After discussion by the Council, the motion failed with only Clark in favor. CLARK THEN MOVED to accept the Findings, Conclusions and Recommendation of the Hearing Examiner on the West Valley at 212th rezone and to direct the City Attorney to prepare the necessary ordinance. White seconded and the motion carried with Clark opposed. C. Daliit Cove Rezone. (Quasi-Judicial) (CFN-121) This request by Aleanna Kondelis of Cramcr NW is to rezone 4.25 acres of property from SR-4 5 to SR-6, Single Family Residential. This applicant also filed a separate but related request to subdivide the property Only the rezone is being considered by the Council this evening. The Kent Hearing Examiner held a Public Hearing on July 20, 2005, and issued Findings, Conclusions, and a Recommendation of approval on August 3, 2005 Matt Gilbert of Planning Services explained the project. CLARK MOVED to accept the Findings, Conclusions and Recommendation of the Hearing Examiner on the Daljit Rezone and to direct the City Attorney to prepare the necessary ordinance White seconded and the motion carried. D 2006 Annual Budget. (CFN-186) CLARK MOVED to set September 20, 2005, as the date for the first public hearing on the 2006 Annual Budget Peterson seconded and the motion carried. E. 2006-2011 Capital Improvement Plan. (CFN-775) CLARK MOVED to set September 20, 2005, as the date for the first public hearing on the 2006-2011 Capital Improvement Plan White seconded and the motion carried REPORTS Planning and Economic Development Committee. (CFN-198) Clark noted that the Committee will meet at 4 00 p.m. on September 19, and that commercial trucks will be discussed. Administrative Reports. (CFN-198) Martin reminded Councilmembers of the two items for Executive Session and said the session will be approximately fifteen minutes and that no action afterward is expected. 4 Kent City Council Minutes September 6, 2005 CONTINUED COMMUNICATIONS A. Crisis Clinic. (CFN-198) Pam Stewart thanked the Mayor and Council for their support and explained the benefits of the Clinic to the City B. Municipal Lot Block. (CFN-198) Bob O'Brien, 1131 Seattle St., commented on parking issues in the area. C Mayoral Debate. (CFN-198) Russell Hanscom urged the City to film the Mayoral debate on September 9th. D. Wilson Playfield. (CFN-198) Joe Rubio asked the Council to rename Wilson Playfield. EXECUTIVE SESSION The meeting recessed to Executive Session at 8 00 p in. and reconvened at 8.22 p.m. ADJOURNMENT THOMAS MOVED to adjourn at 8.22 p.m. White seconded and the motion carried. Brenda Jacober, CMC City Clerk 5 r Kent City Council Meeting Date September 20, 2005 Category Consent Calendar 1. SUBJECT: S 277TH STREET TRAIL, BLOCK WALL PROJECT— ACCEPT AS COMPLETE r2. SUMMARY STATEMENT: As recommended by the Public Works Director, accept the South 2771h Street Trail — Block Wall project as complete and release retamage to Prospect Construction, Inc. upon standard releases from the state and release of any liens. The original contract amount was $40,501.90. The final contract amount was $40,501.90. r 3. EXHIBITS: None 4. RECOMMENDED BY: Public Works Committee (Committee, Staff, Examiner, Commission, etc.) 5. FISCAL IMPACT Expenditure' X Revenue? X Currently in the Budget? Yes X No If no: Unbudgeted Expense: Fund Amount $ Unbudgeted Revenue. Fund Amount $ 6. CITY COUNCIL ACTION: Councilmember moves, Councilmember seconds r 1 DISCUSSION: ACTION: Council Agenda Item No. 6C Kent City Council Meeting Date September 20, 2005 Category Consent Calendar 1. SUBJECT: WASHINGTON STATE DEPARTMENT OF TRANSPORTATION REVISED TEMPORARY EASEMENT AGREEMENT FOR RIVERVIEW PARK—AUTHORIZE 2. SUMMARY STATEMENT: Authorize the Mayor to initial the revised Temporary Construction Easement Agreement with the Washington State Department of Transportation for Riverview Park The original easement was approved by City Council on November 3, 1998, but WSDOT did not secure funding until July 2005, which postponed the project, thus changing the construction termination date. Authorization to approve the date change is necessary in order to proceed with the project. The temporary easement is for WSDOT to construct a retaining wall as a part of the improvements to the HOV lane on Highway 167. The wall is located within the Highway Right-of-Way, but the Contractor needs access through Riverview Park to build the wall Construction should be completed in approximately four weeks. HOV construction is expected to occur from January 2006 through December 31, 2007. 3. EXHIBITS: Copy of easement 4. RECOMMENDED BY: Operations Committee (Committee, Staff, Examiner, Commission, etc.) 5. FISCAL IMPACT Expenditure? N/A Revenue? N/A Currently in the Budget? Yes No If no: Unbudgeted Expense: Fund Amount $ Unbudgeted Revenue: Fund Amount $ 6. CITY COUNCIL ACTION: Councilmember moves, Councilmember seconds DISCUSSION: ACTION. Council Agenda Item No 6D Washington State Northwest Region Department of Transportation 15700 Dayton Avenue north Douglas S. MacDonald PO BOX 3303t0 Secretary of Transportation Seattle,WA 98133-9710 206-440-4000 August I6, 2005 TTY 1-800-833-6388 ug www wsdot wa gov City of Kent Parks, Recreation &Community Services C/o Loii Flemin 1 220 Fourth Ave. S. Kent WA 98032-5838 Dear Ms. Flemm: As you may be aware, the passage of initiative 1-695, with the resultant reduction in income from the state motor vehicle excise tax, or MVET, caused many projects scheduled for construction by the Washington State Department of Transportation to be placed on hold or to be eliminated completely. The SR 167, Kent: So. 285`h St to So. 228`h St. project, for which you previously granted the State a temporary easement, was one of the projects affected. The funding for this project has been restored through action of the State Legislature and is on the Legislative Budget List to receive construction funding. The duration of the project is anticipated to begin January 2006 i and be completed b-v December 31, 2007. The advei tisement for contractor bidding is October 10, 2005. The expiration date of the existing temporary easement is October 1, 2002. Obviously,the document is no longer valid- We are requesting an extension of your previously approved temporary easement through December 31, 2007. The process is vety simple. Your original document will only require striking out the present expiration date and handwriting in the new date, then initialing the change. There are no other changes to be made and the document need not be notarized. The entire process will only take a few minutes to complete. I have enclosed a postage-prepald envelope for your convenience to return the document. Please keep a copy of the revised document for your records. Thank you for your cooperation. Norm Herth Right of Way Agent (206) 440-4209 LIMITS OF PIOWNTED EDGE OF SHOULDER SEALER FINISHED GRADE WORKING LINE & FACE OF WALL RUBBER-ASPHALT FILLER FRACTURED FIN FINISH REINFORCING 4SEE DCTAIL 2EL0'd) MAT { EXISTING GROUND i F_XISTtNG GROUND -WALL BACKFILL GEOTFXTILE FOR UNDERGROUND DRAINAGF. LOW SURVIVALSILITY CLASS C OVERLAP ON TOP 2"-0 MIN. UNDERDRAIN PIPE G IN. DIAM. DAYLIGHT TO FACE OF WALL OR CONC. LEVELING PAC '-G" TIE-IN TD DRAINAGE SYSTEM EVERY 300" HE D GRAVEL BACKFILL FOR DRAINS 3' BASE WIDTH "'B"' URE SEE ELEV. VIEW STRUCTURE EXCAVATION 1 CLASS R INCL. HAUL LIMITS4 L 4 TYPICAL SECTION/WAILS 2 , 2, 4, 5. 6 AND 4 5 STRUCTURAL EARTH WALL 5 B B ISIBLE I!/Z"±%IG SINGS. Via'" TO'' DEEP IRREGULAR FRACTURE _DULE URE FRACTURED FIN FINISH s I GENERAL WALL DESIGN NOTES I 1 1. THE WALL SHALL BE PLACED ON A LEVEL FOUNDATION IN THE HORIZONTAL I DIRECTION PERPENDICULAR TO THE WALL FACE. 4 5 2. THE BASE WIDTH OF THE WALL SHALL BE AT LEAST 70 PERCENT OF THE 5 WALL HEIGHT. WIDER WALL BASE MIGHT BE NEEDED TO PROVIDE ADEQUATE INTERNAL STABILITY. B 8 3. THE UPPERMOST REINFORCING LAYER SHALL BE PLACED NO LOWER THAN 2 FT g BELOW THE TOP OF THE WALL. e 4. WALL BASE EMBEDMENT SHALL BE AT LEAST 2 FT BELOW FINAL FINISHED 8 GRADE. B � g S. FOR WALL ON SLOPING GROUND MINIMUM EMBEDMENT SHALL BE PER WSDOT B BRIDGE DESIGN MANUAL FOR FOOTINGS ON SLOPES. - y r — 6. IN AREAS WHERE SOFT SUBGRADE IS ENCOUNTERED. IT SHALL BE B OVER-EXCAVATED TO A MINIMUM DEPTH OF 2 FT, OR AS DIRECTED BY THE B ENGINEER, AND REPLACED WITH COMPACTED GRAVEL BORROW. , PLOTI ��► SP 167 WD1 TI/ 15TH ST SW TO S 18OTH ST Washington State STAGE 3 363 Department of Tronsporfation rr 822 DAIS WALL DETAILS s P.E.$xa}P 8Ux r After recording return document to: State of Washington Department of Transportation Real Estate Services Office P O. Box 47338 Olympia, WA 98504-7338 r Document Title: Temporary Easement Reference Number of Related Document: N/A Grantor(s) Cii}ygfKent Grantee- State of Washington Legal Description Pin of Gov't Lot 2 in pin of S1V! of Section 24, T22N, R4E, WM Additional Legal Description is on Page(s) 5 of Document Assessors Tax Parcel Number(s): 242204-9185 TEMPORARY EASEMENT State Route 167, Kent: So. 285th St. to So.228th St. (Construction Title: SR 167, 15th St. SW to 15th St. NW HOV Lanes-Stage 3) The Grantor, CITY OF KENT, a municipal corporation of the State of Washington, for and in consideration of MUTUAL BENEFITS, conveys and warrants unto the STATE OF WASHINGTON, and its assigns, a Temporary Easement over, under, upon and across the hereinafter described lands for the purpose of placing personnel, machinery and equipment on said lands to install a retaining wall on adjoining state-owned property. The State of Washington shall, upon the exercise of any such rights specified herein, at its sole cost and expense, restore the surface of this Temporary Easement to a condition at least equal to the condition existing immediately prior to the exercise of such rights. r F A.No.F-167() DOT 262-102A (tmpe1) (7/1/96) Page 1 of pages Tax# 242204-9185 r r TEMPORARY EASEMENT Grantee, its authorized agents and employees, will protect, save and hold harmless the Grantor,its successors or assigns, from all claims, actions, costs, damages or expenses of any nature whatsoever by reason of the acts or omission of the Grantee, its assigns, agents, contractors, licensees, invitees, employees or any person xvboinsoever arising out , of of in connection with any acts or activities authorized by this easement The Grantee, its agents or employees, further agrees to defend the Grantor in any litigation, including payment of any costs or attorney's fees, for any claims or action commenced, thereof arising out of or in connection with acts or activities authorized by this easement. This obligation shall not include such claims, costs, damages or expenses which may be caused by the sole negligence of the Grantor, its successors or assigns; provided that if the claims or damages are caused by or result from the concurrent negligence of: (a) the Grantor, its agents or employees and (b) the Grantee, its agents or employees, and involves those actions covered by RCW 4?4.115, this indemnity provision shall be valid and enforceable only to the extent of the negligence of the Grantor's or Grantee's agents or employees. The temporary rights herein granted shall terminate on-sober-1;2002. Said lands being situated in King County, State of Washington, and described as f follows: As shown hachured on Exhibit A attached hereto and made a part hereof. 1 t 1 i F A.No.F-167 O DOT 262-102A (tmpe1) (7/1/96) Page 2 of 5 pages Tax# 2422 04-9 185 TEMPORARY EASEMENT It is understood and agreed that delivery of this Temporary Easement is hereby tendered and that the terms and obligations hereof shall not become binding upon the State of Washington unless and until accepted and approved hereon in- writing for the State of Washington, Department of Transportation, by the Director of Real Estate Services. Dated ID '� ,2- , 1998 Accepted and Approved: CITY OF KENT STATE OF WASHINGTON Department of Transportation IN144 TE, Mayor P/C'-61 7 i?t .oachim Pestinger, SR/WA Director,Real Estate Services Date: /Z ZLq 8 r F. A.No F-167(} DOT 262-102A ttmpel) (7/1/96) page 3 of 5 pages Tax#242204-9185 r TEMPORARY EASEMENT I STATE OF WASHINGTON ) , ss. County of King ) On this�� day of C'Z'`� f�'c� / 1998, before me personally appeared to me known to be the duly elected and qualified MAYOR f the o--ui+ e $�v City of ent, Washington, who executed the within and foregoing instrumedt and acknowledged said instrument to be the free and voluntary act and deed of said City, for the uses and purposes therein mentioned, and -on oath stated thatshe was authorized to execute said instrument. GIVEN under my hand and official seal the day and year last above written r a r y e�ar,�Rel* = N ary (print name WOO O� otary Public in 4nd for the State of Washington, F '��• ..aA►.�'a residing a ,,'o,�•j ...:��'t�e`' My Appointm nt expires Ofeil fit, i 1 1 1 F.A.No. F-167 O , DOT 262-102A (tmpel) (7/1/96) Page 4 of 5 pages Tax# 242204-9185 r r TEMPORARY EASEMENT EXHIBIT A ---- Ptn of SW ,"4 of Section 24,T22N, R4E, WM J...5SH 5-A I50.31G)t�O oIr J' / / r " - CC TI, m V ovt�Lot Zr/ .� o v�o� L u[�d'-r�v j '_ - ll Ir ate _� �, `i-1// h -/5 ..>`7 �� V\ - _�%- , �,•.i—� � 4, aOO , ��"}- ,��, �;�Jam-l�:- , Lo 5 c 24 }I G1 -/•�3� 1 Pi �� i-- t�' :i r*" i I rj 4-iz—,G7 /f'L �- s t- I 1J,�. � EXH101T, A I- SYJ Rv 33clL ,DLC.'-it�i�� lvanaacK ur+e—�� ,IJ OTE- APPROVED Pcfi SZATE H16H . „•1 � __ o ' zorr.*.,,�s,o>J oRotR (tea Is 1?C-.S Reviewed: SR 167, KENT:SO.285Trf S7- TO 50. 229TH ST- MIN,coulT Sta-790;00 io Sio 822-00 ,.a s..+, .. :0 �1 Date: " /C _ R'aT -T Of -I O SMiRS 1 F.A No. F-167( ) DOT 262-102A (Impel) (7/I/96) Page 5 of 5 pages Tax# 242204-9185 r CITY OF KENT , PARKS COMMITTEE MEETING October 20, 1998 , ITEM 3: fr ° � APPROVAL FOR TEMPORARY EASEMENT TO D.O.T. FOR i ° CONSTRUCTION ACCESS AT RIVERVIEW PARK SUMMARY: The Washington State Department of Transportation has requested a temporary easement across Riverwalk Park for access of personnel, machine and equipment in order to construct a retaining wall on State Property for the propose: HOV lane on Highwe 167. Riverwalk Park is undeveloped. The area impacted consists of field grass and blackberry bushes. Construction would occur between 1999 and October, 2002. Disturbed areas would be restored upon completion of construction. EXHIBITS: Temporary Easement document. TO COUNCIL: November 3, 1998 ACTION: Move to approve a temporary easement to D.O.T. for construction access at Riverview Park, and authorize the Mayor to sign the temporary easement. i 1 t 1 1 WSDOT - Project - SR 167 - 15th Street SW to 15th Street NW - HOV Page 1 of 3 aINk Wws_FSearctr J CotGJ_Y;SDOt r bVSDOT tI©nr t?a artma<M of TranSpo►tatipn � PROJEG7S t t � WSDOT PROJECTS i t SR 167 - 15th Street SW to 15th Street NW - HOV t Funded in part by the 2003 Legislative Funding Package Project Status i r i ' July 2005 • y "+ our engineers have updated designs to include a t7 • Protect Home storm water system that better contains roadway run- s ct Map off and protects streams and other sensitive waterways • Prote • The new protect design complies with more stringent Get Involved Ma d environmental requirements • Northwest Region We are working with regulatory agencies to obtain necessary permits for construction W Main St This fall we will invite contractors from the private a sector to competitively bid for the work • March 2005 •Construction could m beg as soon as winter 2006 $ • December 2004 • September 2004 View entire map • June 2004 When completed, a continuous northbound carpool 1 • March 2004 lane from the Auburn SuperMall of the Northwest to • December 2003 Interstate 405 in Renton with carpool lanes and Project Facts • September 2003 metered ramps at Interchanges will increase safety — --- — - - --- -- • June 2003 and reduce congestion on SR 167. 9 Crews will Gulden SR 167 in Auburn between 15th Street Why is WSDOT widening SR 167? SW and 15th Street NW Lanes for carpools,vanpools, and buses carry far • This project is currently funded more people than a general-purpose lane of traffic for design and construction when the highway is congested These lanes are • Construction begins in winter designed to maximize the movement of people 2006 Thus, even when the lanes look less congested than general-purpose lanes they often carry more people. Building a northbound carpoo lane reduces commute times for transit, carpools and vanpools The End Result This protect constructs a carpool lane on northbound State Route 167 from 15th Street SW to 15th Street NW in Auburn WSDOT will add meters and bypass lanes for carpools, vanpools and buses to northbound and southbound on-ramps between Auburr and Renton at the following interchanges • 15th Street Northwest •South 277th Street •Willis Street (State Route 516) • 84th Avenue South/North Central Avenue • South 212th Street ' • South 180th Street/Southwest 43rd Street Project Benefits • Safety: carpool lanes, widened shoulders and other modifications improve safety on SR 167 See "Safety is one of our priorities"below for more information • Congestion relief: carpool lanes on the highway and bypass lanes with metered lane on the on ramps improve traffic flow http://www wsdottwa aov/Projects/SR167!HOV 15thSW 15thNW/ Aronnnc WSDOT - Project - SR 167 - 15th Street SW to 15th Street NW -HOV Pa-e ? of 3 • Environment: retaining walls, storm water treatment and detention facilities, and erosion control are designed to protect the environment See "Environmental Protection' for further Information , What is the project timeline? Currently advertisement is scheduled for October 2005, construction for winter 2006 anc completion for fall 2007. Public Involvement Your thoughts and opinions are Important to us Please contact design Project Engineer ' John E Johnson or construction Project Engineer Stanley Eng for questions about this project Environmental Protection • Installation of 9 retaining walls to reduce impacts to wetlands and wetland buffers • Construction of storm water treatment facilities for the removal of heavy metals and other debris from highway runoff and detention ponds for storm water flood control • Implementation of approved temporary erosion and sediment control plan •Approved Army Corps of Engineers'wetland mitigation plan will create/enhance more wetlands than the project will Impact Please visit the WSDOT Environmental Services Web site for more information increasing safety is one of our priorities •A combination of guardrails and cable barriers will reduce median crossover accidents • Six modified exit ramps will decrease the chances of rear-end accidents by creating a smoother transition from the highway to the exit ramp •The new carpool and bypass lanes will reduce traffic congestion and accidents •Widening the inside shoulder from 4 feet to 10 feet will provide space for emergency use •New guardrail, concrete barriers and attenuators (crash absorbing devices) increase safety •Anew lighting system at Interchanges Improves visibility at night Will this project impact tribal resources? Section 106 consultation was initiated in July 2001 with the Muckleshoot, Snoqualmie, and Duwamish Tribes As WSDOT continues to develop the project, that consultation process will continue to expand, ensuring that cultural and natural resource issues, of concern to the Tribes, are addressed In a manner consistent with the requirements of Section 106, the Centennial Accord, and the Secretary's Executive Order on Tribal Consultation At WSDOT we seek to address the concerns of the tribal nations using the process outlined in Section 106 of The National Historic Preservation Act and the WSDOT Tribal Consultation Policy adopted in 2003 by the Transportation Commission as part of the WSDOT Centennial Accord Plan For more information visit our WSDOT Tribal Liaison website Financial Information ' This project is funded through resign and construction. Project Funding Expenditures Remaining prior to 7I1I2003 Funds Tota Pre-existing State.Federal and Other Partnership Funds $0 50 $f 2003 Legislative Transportation Package $0 $40,392 573 $40,392,57, Total Available Funding $0 $40,392,573 $40,392.57, WSDOT - Project -SR 167 - 15th Street SW to 15th Street NW - HOV Page 3 of 3 ' Amount Required to Complete Additional Project Stage(s)' $1,929,96: Estimated Total Project Cost $42,322,53( Financial data is r irrent as of 819/2005 WSDOT PIN(s) 116703E .No additional funding source identified Note Program Item Numbers(PINsI are used by the Legislature to keep track of financial data associated with a protect or segment of work How can I get more information? Contact: Design Project Engineer, John E Johnson WSDOT Northwest Region Project Office 15700 Dayton Avenue North P O Box 330310 Seattle, WA 98133-9710 Phone 206-440-4552 E-mail JohnJoh@wsdot wa gov Construction Project Engineer, Stanley Eng, PE WSDOT Kent Protect Office 21851 84th Avenue South Phone 253-872-2962 Fax 253-872-2966 E-mail EngSC@wsdot wa gov ' Ifl back to top Copyright WSOOT©2005 Traffic&Roads I Search I Contact WSDOT I WSDOT Business I Privacy Policy I WSDOT Home r 1 r r i r http•//www.wsdot.wagov/Projects/SR167/HOV15tliSW l5thNW/ Rio��nns 12L7� U r� r3--•iF �' ,� _ CITY OF KENT , PARKS COMMITTEE MEETING -- October 20,=1998 Al' `r L , 3'r•`; fy. `Y w` .k ;ITEM 3:' *'APPROVAL FOR TEMPORARY EASEMENT TO D.O.T. FOR CONSTRUCTION ACCESS AT R_ IVERVIEW PARK SUMMARY: - The Washington State Department of Transportation has requested a temporary easement across Riverwalk Park for access of personnel, machinery and equipment in order to construct a retaining wall on State Property for the propcsed HOB! lane on High%A!2y 167. Riverwalk Park is undeveloped. The area impacted consists of field grass and blackberry bushes. Construction would occur between 1999 and October, 2002. Disturbed areas would be ' restored upon completion of construction. EXHIBITS: Temporary Easement document. TO COUNCIL: November 3, 1998 , ACTION: Move to approve a temporary easement to D.O.T. for construction access at Riverview Park, and authorize the Mayor to sign the temporary easement. Kent City Council Meeting Date September 20, 2005 Category Consent Calendar 1. SUBJECT: WEST VALLEY HIGHWAY AT 212TH REZONE ORDINANCE — ADOPT 1 2. SUMMARY STATEMENT: Adoption of Ordinance No. relating to land use and zoning, rezoning approximately 29.3 acres of property located at the northwest corner of West Valley Highway and South 2121h Street from Industrial Park (Ml) to Industrial Park Commercial (MI-Q. 3. EXHIBITS: Ordinance 4. RECOMMENDED BY: Hearing Examiner (Committee, Staff, Examiner, Commission, etc.) 5. FISCAL IMPACT Expenditure" No Revenue? No Currently in the Budget? Yes No If no: ' Unbudgeted Expense: Fund Amount $ Unbudgeted Revenue. Fund Amount $ ' 6. CITY COUNCIL ACTION: Councilmember moves, Councilmember seconds ' DISCUSSION- ACTION: Council Agenda ' Item No 6E ORDINANCE NO. AN ORDINANCE of the City Council of the City of Kent, Washington, relating to land use and zoning, specifically the rezoning of approximately 29 3 acres of property located at the northwest corner of West Valley Highway and South 2121h Street from Industrial Park (MI) to Industrial Park Commercial (MI-C) (West Valley at 212`h Street Rezone, #RZ-2005-3) 1 RECITALS A. An application was filed on March 14, 2005, by Bob McFadden, Lance Mueller and Associates, to rezone approximately 29 3 acres of property located at the northwest corner of West Valley Highway and South 212`h Street, Kent, Washington, from the current zoning of Industrial Park(MI) to Industrial Park Commercial (M1-C), (West Valley at 2t2`h, #RZ-2005-3). ' B. The City's SEPA responsible official issued a Determination of Nonsigmficance (DNS) (#ENV-2005-18) for the proposed rezone on June 27, 2005. A Ipublic hearing on the rezone was held before the hearing examiner on July 20, 2005. ' C. On August 3, 2005, the hearing examiner issued findings and conclusions that the West Valley at 212`h Rezone is consistent with the city's ' Comprehensive Plan, that the proposed rezone and subsequent development activity would be compatible with the development in the vicinity, that the proposed rezone will not unduly burden the transportation system in the vicinity of the property with 1 West Valley Highway at 212th Rezone significant adverse impacts that cannot be mitigated, that circumstances have changed since the establishment of the current zoning district to warrant the proposed rezone, , and that the proposed rezone will not adversely affect the health, safety, and general welfare of the citizens of the City of Kent. D Based on these findings and conclusions, the hearing examiner recommended approval of the West Valley Highway at 212`h Rezone E. On September 6, 2005, the City Council determined that the hearing examiner's findings and conclusions are consistent with sections 15.09 050(A)(3) ' andl5.09.050(C) of the Kent City Code, accepted the findings of the hearing examiner, and adopted the hearing examiner's recommendation for approval of the West Valley Highway at 2121h Rezone from Industrial Park (M1) to Industrial Park Commercial (MI-C). NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS. ORDINANCE SECTION 1. — Rezone. The property located at the northwest corner of West Valley Highway and South 212`h Street, Kent, Washington consisting of approximately , 29.3 acres depicted in Exhibit "A" (marked "Vicinity Map"), attached and incorporated by this reference, and legally described in Exhibit "B", attached and incorporated by , this reference, is rezoned from Industrial Park (M1) to Industrial Park Commercial (MI-C) The City of Kent zoning map shall be amended to reflect the rezone granted above. SECTION 2. — Severabahh> If any one or more sections, sub-sections, or sentences of this ordinance are held to be unconstitutional or invalid, such decision 2 West Valley Highway at 212th Rezone shall not affect the validity of the remaining portion of this ordinance and the same ' shall remain in full force and effect. ' SECTION 3. —Effective Date This ordinance shall take effect and be in force five (5) days from and after its passage as provided by law. i JIM WHITE, MAYOR ATTEST: BRENDA JACOBER, CITY CLERK APPROVED AS TO FORM: ' TOM BRUBAKER, CITY ATTORNEY PASSED: day of September, 2005. ' APPROVED: day of September, 2005. PUBLISHED: day of September, 2005. I hereby certify that this is a true copy of Ordinance No. jpassed by the City Council of the City of Kent, Washington, and approved by the Mayor of the City of Kent as hereon indicated. (SEAL) BRENDA JACOBER, CITY CLERK P CrvA\ORDMANCE\Rezone-WestValley2l2th doe 3 West Valley Highway at 212th Re.-One Kent City Council Meeting Date September 20, 2005 Category Consent Calendar 1. SUBJECT: DALJIT COVE REZONE ORDINANCE —ADOPT 2. SUMMARY STATEMENT: Adoption of Ordinance No. relating to land use and zoning, rezoning approximately 4.25 acres of property located at 22604 and 22522 94`11 Avenue South, Kent, Washington from the current zoning of from Single Family Residential 4.5 units per acre (SR-4.5) to Single Family Residential 6 units per acre (SR-6). 1 3. EXHIBITS: Ordinance ' 4. RECOMMENDED BY: Hearing Examiner (Committee, Staff, Examiner, Commission, etc.) 5. FISCAL IMPACT Expenditure`' No Revenue? No ' Currently in the Budget? Yes No If no: Unbudgeted Expense: Fund Amount $ Unbudgeted Revenue: Fund Amount $ 6. CITY COUNCIL ACTION: Councilmember moves, Councilmember seconds i DISCUSSION: ACTION: Council Agenda Item No 6F ORDINANCE NO. AN ORDINANCE of the City Council of the City of Kent, Washington, relating to land use and zoning, specifically the rezoning of approximately 4 25 acres of property located at 22604 and 22522 94`" Avenue South from Single Family Residential 4.5 units per acre (SR-4 5) to Single Family Residential 6 units per acre (SR-6). (Dallit Cove Rezone,#RZ-2004-5). RECITALS ' A. An application to rezone approximately 4.25 acres of property located at 22604 and 22522 941h Avenue South, Kent, Washington from the current zoning of ' from Single Faintly Residential 4.5 units per acre (SR-4.5) to Single Family Residential 6 units per acre (SR-6), was filed on December 3, 2004, by Aleanna Kondelis, Cramer NW Inc. (Dallit Cove, #RZ-2004-5). ' B. The City's SEPA responsible official issued a Determination of Nonsignificance (DNS) (#ENV-2005-18) for the proposed rezone on June 15, 2005. A ' public hearing on the rezone was held before the hearing examiner on July 20, 2005 C. On August 3, 2005, the hearing examiner issued findings and conclusions that the Dallit Cove Rezone is consistent with the city's Comprehensive Plan, that the proposed rezone and subsequent development activity would be compatible with the development in the vicinity, that the proposed rezone will not unduly burden the transportation system in the vicinity of the property with significant adverse impacts that cannot be mitigated, that circumstances have changed since the 1 Daljit Cove Rezone establishment of the current zoning district to warrant the proposed rezone, and that the proposed rezone will not adversely affect the health, safety, and general welfare of the ' citizens of the City of Kent. D. Based on these findings and conclusions, the hearing examiner ' recommended approval of the Daljit Cove Rezone. ' E. On September 6, 2005, the City Council determined that the hearing examiner's findings and conclusions are consistent with sections 15 09.050(A)(3) and 15.09.050(C) of the Kent City Code, accepted the findings of the hearing examiner, and adopted the hearing examiner's recommendation for approval of the Daljrt Cove Rezone from Single Family Residential 4.5 units per acre (SR-4.5) to Single Family ' Residential 6 units per acre (SR-6). NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT, ' WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS ORDINANCE ' SECTION 1. -Rezone. The property located at 22604 and 22522 94`h Avenue , South, Kent, Washington consisting of approximately 4.25 acres depicted in Exhibit "A" (marked "Vicinity Map"), attached and incorporated by this reference, and legally ' described in Exhibit "B", attached and incorporated by this reference, is rezoned from Single Family Residential 4.5 units per acre (SR-4 5) to Single Family Residential 6 ' units per acre (SR-6). The City of Kent zoning map shall be amended to reflect the rezone granted above. ' 2 Daljit Cove Rezone ' SECTION Z — Severability. If any one or more sections, sub-sections, or ' sentences of this ordinance are held to be unconstitutional or invalid, such decision shall not affect the validity of the remaining portion of this ordinance and the same shall remain in full force and effect SECTION 3. —Effective Date This ordinance shall take effect and be in force five (5) days from and after its passage as provided by law. ' JIM WHITE, MAYOR ATTEST: BRENDA JACOBER, CITY CLERK ' APPROVED AS TO FORM: TOM BRUBAKER, CITY ATTORNEY PASSED: day of September, 2005. ' APPROVED. day of September, 2005. ' PUBLISHED: day of September, 2005. I hereby certify that this is a true copy of Ordinance No. passed by the City Council of the City of Kent, Washington, and approved by the Mayor of the City of Kent as hereon indicated (SEAL) BRENDA JACOBER, CITY CLERK P%Crvd\ORDINANCE�Remne-DalylCave dac ' 3 Daljit Cove Rezone Kent City Council Meeting Date September 20. 2005 Category Consent Calendar 1. SUBJECT: 228TH STREET CORRIDOR QWEST AND PUGET SOUND ENERGY AGREEMENTS —AUTHORIZE 2. SUMMARY STATEMENT: Authorize the Mayor to sign the Design and Construction Agreements with Puget Sound Energy and Qwest authorizing the two companies to utilize City property acquired for the S. 2281h Street Corridor West ' Hillclimb Extension to place underground facilities prior to roadway construction upon concurrence of the language by the City Attorney and the Public Works Director. 3. EXHIBITS: Public Works Director's memorandum and Puget Sound Energy Construction agreement 4. RECOMMENDED BY: Public Works Committee (Committee, Staff, Examiner, Commission, etc.) 5. FISCAL IMPACT Expenditure? N/A Revenue? Currently in the Budget? Yes N/A No If no: I Unbudgeted Expense: Fund Amount $ Unbudgeted Revenue: Fund Amount $ 6. CITY COUNCIL ACTION: Councilmember moves, Councilmember seconds DISCUSSION• ACTION• Council Agenda ' Item No 6G PUBLIC WORKS DEPARTMENT 4^*46* Larry R. Blanchard, Public Works Director Phone 253-856-5500 KENT Fax 253-856-6500 W A S N I N G T G N Address 220 Fourth Avenue S. Kent,WA.98032-5895 DATE: August 15, 2005 TO: Public Works Committee FROM: Tim LaPorte, Design Engineering Manager THROUGH: Larry R. Blanchard, Public Works Director SUBJECT: 228th Corridor Qwest and Puget Sound Energy Agreements MOTION: Recommend authorizing the Mayor to sign agreements with Qwest and Puget Sound Energy, authorizing the two companies to utilize City property acquired for the S. 228th Corridor West Hillclimb Extension to place underground facilities prior to roadway construction. Approval of these two agreements is subject to further refinements and approval by the City Attorney and the Public Works Director. SUMMARY: The city has acquired property for the S 228th Corridor West Hillclimb and the roadway and bridge work is under construction The final contracts for road paving, the Riverview Blvd. bridge and signals are scheduled to be released spring 2006 for a corridor opening in the fall of 2006. The proposed utility work would include placing underground utilities prior to pavement and other work, and can be done until the end of September 2005 without compromising the schedule for the remaining work or interfering with the ongoing construction work of the City's contractor. These agreements authorize this advance work by Qwest and PSE at their expense. BUDGET IMPACT:There is no budget impact as the work would be done by PSE and Qwest contractors. BACKGROUND: Utility Companies such as Qwest and PSE appreciate the opportunity to place empty conduits or gas lines in advance of final road construction so they do not have to tear up the roadway later at an added cost to the utility as well as a major inconvenience to the motoring public utilizing the corridor after it is open. The utility construction would be much cheaper at this time since the existing roadway restoration is comprised of crushed rock . The city notified PSE and Qwest of this opportunity a year ago and both companies have decided that they would like to take advantage of this one time opportunity that will end at the end of September. This is similar to our past practice on both the 277th St. and the 196th St. corridors where utility lines were placed before the final roadway surface was built. The work cannot be done after September because then the city would run the risk of a major change order or delay in getting the project completed on time The work requires this special agreement because the city property has not yet been dedicated as public right of way which does not take place until after the completion of the corridor project. Mayor Wlute and Kent City Council 1 DESIGN AND CONSTRUCTION AGREEMENT Between the City of Kent and Puget Sound Energy (PSE) for S. 228th Street Extension Joint Utility Trench THIS AGREEMENT is entered into between the City of Kent, a Washington municipal corporation ("City"), and Puget Sound Energy, a Washington corporation ("PSE"). RECITALS WHEREAS, the City is constructing the S. 228th Street Extension between 54th Avenue South and Military Road. WHEREAS, PSE desires to install natural gas and electric facilities on City of Kent property within the S. 228th Street Extension alignnment and on the S_ 228th Street Green River Budge. WHEREAS, the City of Kent property is not dedicated right of way covered by the PSE/Kent franchise agreement. WHEREAS, both parties agree that installing PSE facilities prior to construction of the S. 228th Street Extension would be beneficial to PSE and would mimmize disruption to the motoring public following construction of the project. AGREEMENT To facilitate construction of a joint utility trench ("joint trench") and installation of PSE facilities on the Green River Bridge ("bridge utilities"), the parties agree as follows: 1. SCOPE OF WORK PSE will design and construct a joint trench within the S. 228th Street Extension alignment,between Frager Road and Military Road (see Exhibit A). Thejomt trench will include PSE natural gas and electrical facilities. Installation of PSE facilities will be the responsibility of PSE. PSE shall be responsible for coordination of joint trench construction based on the Schedule noted in Section 2 of this agreement. PSE will design and construct the trench between the Green River Bridge and Russell Road to connect to existing electric conduit and a gas line that were installed in 2004 (see Exhibit A) PSE will complete a seismic structural design for its gas facilities on the Green River Bridge The seismic design will be stamped by a structural engnicer licensed in the State of Washington that has expeitence in the design of gas utilities including seismic t of7 requirements. Upon approval of PSE's design, the City's bridge contractor will construct portions of the gas facilities except the steel gas carrier pipe, which will be installed by PSE at a later date. PSE will reimburse the City for all costs the City incurs related to the installation of these PSE facilities. The City will install a 6" Schedule 40 PVC pipe including related hangers and hardware, which will be used by PSE at a later date for electrical conductors. PSE will reimburse the City for all costs the City incurs related to the installation of this PSE . facility. 2. SCHEDULE Due to the schedule for various phases of construction along S. 228th Street, the following time restrictions will be placed on construction of PSE's facilities. a. Construction of the joint trench between station 18+00 and station 43+00 as shown in Exhibit A shall be completed and the area completely restored to existing conditions by September 30, 2005. b. The City will be constructing a roadway fill section over Bolger Road between Military Road and station 18+00. PSE work in this area shall take place following the City's work and upon the City's approval to complete the joint trench. The City anticipates that the approval will be granted November 2005. Work in this area shall be completed by December 31, 2005. C. Following completion of the S. 228th Street Green River Bridge and upon a separate approval from the City, PSE will install its facilities between station 43+00 and station 56+00. This work shall be completed by April 0, 2006. PSE understands that other construction work will be ongoing and that PSE's contractor will have a short period of time in which to install these utilities. 3. CONTRACTOR REQUIRE,IVIENTS The independent contractor hired by PSE to perform work shall be referred to as "the PSE contractor" in this Agreement The PSE contractor, pursuant to a contract with PSE, shall excavate the trench, install PSE facilities, accommodate and coordinate the installation of PSE facilities, install the bedding material, construct trench cut-off walls and associated drains, backfill and compact the trench to the City's requirements, and restore the site to existing conditions as required by the City, all to be perfonned in a good and workmanlike manner consistent with industry standards. PSE represents that any such contract shall further require of the PSE contractor that the work be conducted in conformity with (i) the applicable procedures and requirements of the parties as described herein; (n) all applicable laws, ordinances and regulations of any governmental authority, and, (in) all applicable terms and provisions of the National Electric Safety Code, as may be amended, supplemented or replaced from time to time, including but not limited to those pertaining to protection and separation of conductors buried in earth. 2of7 4. RESPONSIBILITY OF THE PARTIES A. Draivin;s PSE shall provide detailed engineering drawings to the City to obtain approval from the City for the design and installation of PSE's facilities. These drawings shall show in detail the location and elevation of the gas line and electrical conduit, the joint trench, vaults, and all other PSE and City or other facilities relative to the centerline stationing provided by the City The City will provide the road design plans to PSE for use as a basis of its design. The natural gas line design on the S. 228th Street Green River Bridge shall be submitted with a Structural Engineer's stamp certifying that the line has been designed for seismic loading. B. Installation PSE shall be responsible for supplying and installing all of its own facilities and shall accommodate other utilities that may be approved and permitted by the City for inclusion in the joint trench. All right, title and interest in PSE facilities and associated equipment shall at all times remain with PSE. Parties hereto acknowledge and agree that PSE's contractor shall be held contractually responsible for secunnty the City provided working area, its equipment and materials related to the installation oC PSE facilities. C. Coordination with other Contractors. The City will have up to three contractors working in the vicinity of the proposed PSE _joint trench at any given tune The City's contractor(s) shall have frill access to all City property. PSE's contractor shall coordinate with any City contractor in the area to ensuie PSE's work will not interfere with any City construction project. D. Traffic Control PSE's contractor shall provide all traffic control associated with installation of facilities. Access to residences on Bolger Road shall be maintained at all times and appropriate traffic control measures shall be taken to ensure access is safe and unrestricted. E. Surveys. PSE shall provide all surveying and legal descriptions required to execute the Temporary Easement (see Section 5 of this agreement) and construct and as- built the joint trench. The survey and legal descriptions shall be provided under the direction of and stamped by a licensed prolcssional surveyor (PLS), holding a valid PLS license in the State of Washington. The City will supply survey control points as deemed necessary by the City for use by PSE's surveyor. F. DNR Permit. PSE shall obtain an Aquatic Lease from the Washington State Department of Natural Resources (DNR) and send copies of the permit to the City prior to adding the gas tune to the Green Rig er Bridge and prior to the City constructing the 6" electrical conduit on the Green River Bridge. 5. TEMPORARY EASEMENT The property between Military Road and the Green River has not yet been dedicated as public right-of-way. Therefore, PSE shall obtain a temporary easement for 3of7 i installation of the facilities referred to in this agreement. This easement shall be executed prior to construction of any PSE facilities. 6. COMPENSATION A. Trench costs. PSE agrees to pay all costs associated with installation of its facilities, including restoration of the site to existing or better condition. B. Survey. PSE agrees to pay all costs for the City surveyor's time to provide control points and additional surveying information to PSE's surveyor. C. Design approval and incorporation. PSE agrees to pay any and all of the ' City's reasonable direct and indirect costs related to design review, incorporation of design into bridge plans, and construction management and inspection for installation of PSE facilities. Also included are costs of the City's structural geotechnical and seismic consultants related to the PSE utilities. D. Additional Expenses. PSE agrees to pay the City for all expenses associated with documented construction delays PSE causes to City contractors. E. Invoice. PSE agrees to pay the City within sixty(60) days of being invoiced r by the City for charges related to this agreement. F. Defective or Unauthorized Work. PSE agrees to pay the City for all City- incurred costs related to errors and omissions attributable to PSE's joint trench installation. All defective or unauthorized work shall be repaired and restored at the direction of the City and at PSE's expense. This includes the repair of trench sections prior to final roadway construction. G. Cin,-Related Installations. The City shall pay PSE's contractor to install i any City-owned conduit. 7. CHANGES. PSE shall submit any changes related to the final approved design to the City a minimum of 3-days prior to intended construction of the proposed change. The City will review the proposed change and will approve or deny the change as soon as possible. 8. INDEMNIFICATION; LIENS AND ENCUMBRANCES. PSE shall defend, indemnify and hold the City, its officers, officials, employees and agents harmless from any and all claims, injuries, damages, losses or suits including all legal costs and attorney fees, arising out of or in connection with the performance of the party's work required under this Agreement, except for injuries and damages caused by the negligence or«tllful misconduct of the other party. 4of7 Should a court of competent jurisdiction determine that this Agreement is subject to RCW 4.24.115, then, in the event of liability for damages arising out of bodily injury to persons or damages to property caused by or resulting from the concurrent negligence of the parties, their officials, employees and agents, a party's liability hereunder shall be only to the extent of the patty's negligence. The provisions of this section shall survive the expiration or termination of this Agreement. No party, directly or indirectly, shall create or impose any lien on the property of another, or on the rights or title relating thereto, or any interest therein, or in this Agreement. Each party shall promptly, at its own expense, take such action as may be necessary to duly discharge any lien created by it on the property ofanothei. 9. INSURANCE. I The contract between PSE and its contractor shall require that the PSE contractor procure and maintain for the duration of the project insurance of the types and in the amounts described below against claims for injuries to persons or damage to property which may arise from or in connection with the performance of the work by the PSE contractor, its agents, representative, employees, subconsultants or subcontractors. 1. Automobile Liability insurance with limits no less than $1,000,000 commbined single limit per accident for bodily Injury and property damage; and 2. Commercial General Liability insurance written on an occurrence basis with limits no less than $1,000,000 combined single limit per occurrence and general aggregate for personal injury, bodily injury and property damage. Coverage shall include but not be limited to blanket contractual; products/completed operations/broad form ' property damage; explosion, collapse and underground (XCU); and employer's liability. 3. Excess Liability insurance with limits not less than $1,000,000 per occurrence and aggregate. Any payment of deductible or self insured retention shall be the sole responsibility of the PSE contractor. The parties (PSE and the City), their officials, employees, agents and volunteers shall be named as additional insureds on the insurance policy, as respects wort: perfoirned by of on behalf of the parties and a copy of the endorsement naming the parties as additional insured shall be attached to the Certificate of Insurance, copies of which shall be provided to the parties prior to conunencennent of construction by the PSE contractor. The PSE contractor's insurance shall contain a clause stating that coverage shall apply separately to each insured against whom claim is made or suit is brought, except with respects to the limits of the insurer's liability. 5 of 7 10. MISCELLANEOUS. A. Compliance with Laws. The parties shall comply witli all federal, state and local laws, rules and regulations throughout every aspect in the performance of this Agreement. B. Nonivaiver of Breach. The failure of a pasty to insist upon strict , performance of any of the terms and rights contained herein, or to exercise any option herein conferred in one or more instances, shall not be constructed to be a waiver or relinquishment of those terns and rights and they sha1.1.ernain in ull b cc and effect C. Governing, Law. This Agreement shall be governed and construed in accordance with the laws of the State of Washington. If any dispute arises between the ' parties or between any party and the PSE contractor under any of the provisions of this Agreement, resolution of that dispute shall be available only through the jurisdiction, venue and rules of the King County Superior Court, King County, Washington. D. Attorneys Fees. To the extent not inconsistent with RCW 39.04.240, in any claim or lawsuit for damages arising from the parties' perJorinance of this Agreement, each party shall be responsible for payment of its own legal costs and attorney's fees incurred in defending or bringing such claim or lawsuit. E. TFritten Notice. All communications regarding this Agreement shall be sent , to the parties at the addresses listed on the signature page of this Agreement, unless otherwise notified. Any written notice shall become effective upon delivery, but in any event three (3) calendar days after the date of mailing by registered or certified mail, and shall be deemed sufficiently given if sent to the addressee at the address stated on this Agreement. F. Modification. No waiver, alteration, or modification of any of the provisions of this Agreement shall be binding unless in writing and signed by a duly authorized representative of each of affected party. G. Severability. If any one or more sections, sub-sections, or sentences of this Agreement are held to be unconstitutional or invalid, that decision shall not affect the validity of the remaining portion of this Agreement and the remainder shall remain in full force and effect. H. Relationship. It is understood and agreed that no agency, employment,joint venture, co-employer or partnership is created by this Agreement. No party hereto shall (i) have the power or authority to act for another in any manner to create obligations or debts which would be binding upon another, and; (ii) be responsible for any obligation or expense whatsoever of another I. Force Majeure Parties shall not be deemed to be in breach of this Agreement if unable to perform their respective obligations hereunder as a result of the occurrence of an event of"force majeure," which shall include, but not be limited to, acts 6 of 7 of God, acts of the government of the United States or of any state or political subdivision thereof, strikes, civil riots or disturbances, fire, floods, explosions, earthquakes, wind, storms, hurricanes, lightning or other similar catastrophes or other causes beyond the parties' reasonable control. The scope of events of force majeure shall not extend to payment of money owed hereunder. J. Entire Agreement. The written provisions and terms of this Agreement, together with any attached Exhibits, supersede all prior vezbal statements by any representative of the City, and those statements shall not be construed as forming a part of or altering in any manner this agreement. This Agreement and any attached Exhibits contain the entire Agreement between the parties. Should any language in ally Exhibit to this Agreement conflict with any language contained in this Agreement, the terms of this Agreement shall prevail. IN WITNESS WHEREOF, the parties below have executed this Agreement. Puget Sound Energy,INC. CITY OF KENT Print Name- Doug Corbel Print Name. Gary Gill, P E Title. Municipal Liaison Manager Title: City Engineer DATE DATE NOTICES TO BE SENT TO: NOTICES TO BE SENT TO: PSE CITY OF KENT PSE City oEKent 6905 South 228th Street/SKC-SVC 220 Fourth Avenue South Kent, WA 98032 Kent, WA 99032 Attn Douglas L. Corbin Attn: Chad Bieren (253) 395-6867 (Desk) (253) 856-5534 (Desk) (253) 604-3137 (Nlobtle) (253) 856-6500 (Fax) (253) 395-6882 (Fax) With a copy to: APPROVED AS TO FOAM: Kent Law Department P\CrvJ1FILL-SOpenFilo10177-200515 n3thAgse .t-PSEdm RESIGN AND CONSTRUCTION AGREEMENT Between the City of Kent and Qivest for S. 228th Street Extension Utility Trench THIS AGREEMENT is entered into between the City of Kent, a Washington municipal corporation(`City"), and Qwest, a Colorado corporation ("Qwest"). RECITALS WHEREAS, the City is constructing the S. 228th Street Extension between 54th Avenue South and Military Road. WHEREAS, Qwest desires to install telecommunications facilities on City of Kent property within the S. 228th Street Extension alignment and on the S. 228th Street Green River Bridge. WHEREAS, the City of Kent property is not dedicated right of way and cannot be occupied by Qwest without a temporary easement. WHEREAS, both parties agree that installing Qwest facilities prior to constriction of the S. 228th Street Extension would be beneficial to Qwest and would minimize disruption to the motoring public following construction of the project. AGREEMENT ' To facilitate construction of a utility trench (`trench") and installation of Qwest facilities on the Green River Bridge(`bridge utilities"), the parties agree as follows: 1. SCOPE OF WORK Qwest will design a trench within the S. 228th Street Extension alignment, , between Military Road and Russell Road (see Exhibit A). Qwest will install its facilities within the trench based on the Schedule noted in Section 2 of this agreement. The City will install 4, 4" Schedule 40 PVC conduits including related hangers and hardware on the S. 228th Street Bridge STA 46+40 to STA 50+60, which will be used by Qwest at a later date for telecommunications line. Qwest will obtain a DNR pen'ut prior to construction of the conduit wins. Qwest will reimburse the City for all costs the City incurs related to the installation of Qwest facilities. 2. SCHEDULE Due to the schedule Cor various phases of construction along S. 228th Street, the following time restrictions will be placed on constriction of Qwest's facilities. 1 or7 a. Construction of the trench between station 18+00 and station 4S+00 as shown in Exhibit A shall be completed and the area completely restored to existing conditions by September 30, 2005. b. The City will be constructing a roadway fill section over Bolger Road between Military Road and station 15+00 Qwest work in this area shall take place following the City's work and upon the City's approval to complete the trench. The City anticipates that the approval will be granted November 2005. Work in this area shall be completed by December 31, 2005 provided that the City's work is completed by November 23, 2005. C. Following completion of the S. 228th Street Green River Bridge and upon a separate approval from the City, Qwest will install its facilities between station 43+00 and station 56+00. This work shall be completed within 30 working days after the City has given approval. 3. CONTRACTOR REQUIREMENTS The independent contractor hired by Qwest to perform work shall be referred to as "the Qwest contractor" in this Agreement. The Qwest contractor, pursuant to a contract with Qwest, shall excavate the trench, install Qwest facilities, accommodate and coordinate the installation of Qwest facilities, install the bedding material, construct trench cut-off walls and associated drains as required by the City and as designed by the City's geotechnical engineer, backfill and compact the trench to City requirements, and restore the site to existing conditions as required by the City, all to be performed in a good and workmanlike manner consistent with industry standards. Qwest represents that any such contract shall further require of the Qwest contractor that the work be conducted in conformity with (i) the applicable procedures and requirements of the parties as described herein, (u) all applicable taws, ordinances and regulations of any governmental authority, and; (in) all applicable terms and provisions of the National Electric Safety Code, as may be amended, supplemented or replaced from time to time, including but not limited to those pet taining to protection and separation of conductoi s buried in earth. ' 4. RESPONSIBILITY OF THE PARTIES A. Drawings. Qwest shall provide detailed engineering drawings to the City to obtain approval from the City for the design and installation of Qwest's facilities. These drawings shall show in detail the location and elevation of tine telecommunications conduit, the trench, vaults, and all other Qwest and City or other facilities relative to the centerline stationing provided by the City. The City will provide the road design plans to Qwest for use as a basis of its design. B. Installation. Qwest shall be responsible for supplying and installing all of its own facilities. Alt right, title and interest in Qwest facilities and associated equipment shall at all tunes reinaui with Quest. Parties hereto acknowledge and agree that Qwest's contractor shall be held contractually iesponsible for securing the City provided working area, its equipment and materials related to the installation of Qwest 2 of 7 C. Coordination with other Contractors. The City will have up to three contractors vvorkmg in the vicinity of the proposed trench at any given time. The City's contractor(s) shall have frill access to all City property. Qwest's contractor shall coordinate with any City contractor in the area to ensure Qwest's work wit] not interfere with any City construction project. D. Traffic Control. Qwest's contractor shall provide all traffic control associated with installation of Qwest facilities. Access to residences on Bolger Road shall be maintained at all times and appropriate traffic control measures shall be taken to ensure access is safe and unrestricted. E. Surveys. Qwest shall provide all surveying and legal descriptions required to execute the Temporary Easement (see Section 5 of this agreement) and construct and as-built the trench. The survey and legal descriptions shall be provided under the direction of and stamped by a licensed professional surveyor (PLS), holding a valid PLS license in the State of Washington. The City will supply survey control points as deemed necessary by the City for use by Qwest's surveyor. F. DNR Permit. Qwest shall obtain an Aquatic Lease from the Washington State Department of Natutal Resources (DNR) and send copies of the pernlit to the City prior to the City constructing the 4, 4" telecommunications conduits on the Green River Bridge. 5. TEMPORARY EASEMENT The property between Military Road and the Green River has not yet been ' dedicated as public right-of-way. Therefore, Qwest shall obtain a temporary easement for installation of the facilities referred to in this agreement This easement shall be executed prior to construction of any Qwest facilities. 6. COMPENSATION A. Trench costs. Qwest agrees to pay all costs associated with installation of its facilities, including restoration of the site to existing or better condition. B. Survey. Qwest agrees to pay all documented reasonable costs for the City surveyor's time to provide control points and additional surveying information to Qwest's surveyor. C. Design approval and incorporation. Qwest agrees to pay all of the City's direct and indirect costs related to design review and approval of Qwest's plans, construction management and inspection for installation of Qwest facilities. This also includes costs of the City's structural and geotechnical consultants related to the installation of Qwest facilities. 3 of 7 D. Additional Expenses. Qwest agrees to pay the City for all expenses associated with documented construction delays to the City's contractors proximately caused by Qwest or its Contractor. E. Invoice. Qwest agrees to pay the City within sixty (60) days of being invoiced by the City for changes ielated to this agreement. F. Detective or Unauthorized Work. Qwest agrees to pay the City for all City- incurred costs related to errors and omissions attributable to Qwest's trench installation. All defective or unauthorized work shall be repaired and restored at the direction of tile City and at Qwest's expense. This includes the repair of trench sections prior to final roadway construction. 7. CHANGES. Qwest shall submit any changes related to the final approved design to the City a minimum of 3-days prior to intended construction of the proposed change. The City will review the proposed change and will approve or deny the change as soon as possible. S. INDEMNIFICATION; LIENS AND ENCUMBRANCES. Qwest shall defend, indemnify and hold the City, its officeis, officials, employees and agents harmless from any and all claims, injuries, damages, losses or suits including I all legal costs and attorney fees, arising out of or in connection with the performance of the parry's work required under this Agreement, except for injuries and damages caused by the negligence or willful misconduct of the other party. Should a court of competent jurisdiction determine that this Agreement is subject to RCW 4.24.115, then, in the event of liability for damages arising out of bodily injury to persons or damages to property caused by or resulting 1i-om the concurrent negligence of the parties, their officials, employees and agents, a party's liability hereunder shall be only to the extent of the party's negligence The provisions of this section shall survive the expiration or termination of this Agreement. No party, directly or indirectly, shall create or impose any lien on the property of another, or on the rights or title relating thereto, or any interest therein, or in this Agreement. Each party shall promptly, at its own expense, take such action as may be necessary to duly discharge any lien created by it on the property of another. 9. INSURANCE. The contract between Qwest and its contractor shall require that the Qwest contractor procure and maintain for the duration of the project insurance of the types and in the amounts described below against claims for injuries to persons or damage to property which may arise from of to connection with the performance of the work by the contractor, its agents, representative, employees, subconsultants or subcontractors. 4 of 7 1. Automobile Liabihty insurance with limits no less than $1,000,000 combined single limit per accident for bodily injury and property damage; and 2. Commercial General Liability insurance written on an occurrence basis with limits no less than $1,000,000 combined single linut per occurrence and general aggregate for personal injury, bodily injury and property damage. Coveraue shall include but not be limited to: blanket contractual; products/completed operations/broad form property damage; explosion, collapse and underground (XCU); and employer's liability. 3. Excess Liability insurance with limits not less than $1,000,000 per occurrence and agQ egate. Any payment of deductible or self insured retention shall be the sole responsibility of the contractor. The parties (Qwest and the City), their officials, employees, agents and volunteers shall be named as additional insureds on the insurance policy, as respects work performed by or on behalf of the parties and a copy of the endorsement naming the parties as additional insured shall be attached to the Certificate of Insurance, copies of which shall be provided to the parties prior to commencement of construction by the contractor. The contractor's insurance shall contain a clause stating that coverage shall apply separately to each insured against whom claim is made or suit is brought, except with respects to the limits of the insurer's liability. 10. MISCELLANEOUS. A. Compliance with Laws. The parties shall comply with all federal, state and local laws, rules and regulations throughout every aspect in the performance of this Agreement. B. Nonwaiver of Breach. The failure of a party to insist upon strict performance of any of the terms and rights contained herein, or to exercise any option herein conferred in one or more instances, shall not be constructed to be a waiver or relinquishment of those terms and rights and they shall remain in full force and effect C. Governing Law. This Agreement shall be governed and construed in accordance with the laws of the State of Washington. If any dispute arises between the parties or between any party and the contractor under any of the provisions of this Agreement, resolution of that dispute shall be available only through the jurisdiction, venue and rules of the King County Superior Court, Kin; County, Washington. D. Attorney's Fees To the extent not inconsistent with RCW '19.04.240, in any claim or lawsuit for damages arising froin the parties' perfonmance of this Agreement, of 7 each party shalt be responsible for payment of its own legal costs and attorney's fees incurred in defending or bringing such ctaim or lawsuit. E. Written Notice. All communications regardmg this Agreement shall be sent to the parties at the addresses listed on the signature page of this Agreement, unless otherwise notified Any written notice shall become effective upon delivery, but nn any event three (3) calendar days after the date of mailing by registered or certified mail, and shall be deemed sufficiently given if sent to the addressee at the address staled on this Agreement. F. Modification. No waiver, alteration, or modification of any of the provisions of this Agreement shall be binding unless in writing and signed by a duly authorized representative of each of affected patty. G. Severabilitv. If any one or more sections, sub-sections, or sentences of this Agreement are held to be unconstitutional or invalid, that decision shall not affect the validity of the remaming portion of this Agreement and the remainder shall remain in full force and effect. H. Relationship. It is understood and agreed that no agency, employment,joint venture, co-emptoyer or partnership is created by this Agreement. No party hereto shall (i) have the power or authority to act for another in any manner to create obligations or debts which would be binding upon another, and, (i ) be responsible for any obligation or expense whatsoever of another. I. Force Majeure. Parties shall not be deemed to be in breach of this Agreement if unable to perform their respective obligations hereunder as a result of the occurrence of an event of"force majeure," which shall include, but not be limited to, acts of God, acts of the government of the United States or of any state or political subdivision thereof, strikes, civil riots or disturbances, fire, floods, explosions, earthquakes, wind, storms, hurricanes, lightning or other similar catastrophes or other causes beyond the parties' reasonable control. The scope of events of force majeure shall not extend to paynnent of money owed hereunder. J. entire Agreement. The written provisions and terms of this Agreement, together with any attached Exhibits, supersede all prior verbal statements by any representative of the City, and those statements shall not be construed as forming a part of or altering in any inanner this agreement This Agiecment and any attached Exhibits contain the entire Agreement between the parties. Should any language in any Exhibit to this Agreement conflict with any language contained in this Agreement, the teens of this Agreement shall prevail. 6 of 7 IN WITNESS WHEREOF, the parties below have executed this Agreement. QWEST OF WASHINGTON IV,INC. CITY OF KENT Print Name: Jeff Watson Print Name: Gary Gill,P.E. Title: Contracts Manager Title: City Engineer DATE DATE i NOTICES TO BE SENT TO: NOTICES TO BE SENT TO: Qwest CITY OF KENT Qwest City of Kent 23315 66th Avenue South 220 Fourth Avenue South , Kent, WA 98032 Kent, WA 98032 Attn• Jeff Watson Attn: Chad Biercn (253) 372-5358 (Desk) (25D 856-5534 (Desk) (253) 856-6500 (Fax) With a copy to- APPROVED AS TO FORM: Kent Law Department Plc mrmmoprnnwo 177-200%S 223thAg=ment-QwM dm 7 of 7 of / mrr c om tl.oir _E � \ �R Znmm �^ 2� I 0 Sm zo pzx J wA p7 z�n vm^ si , � ro oD —�— F 3 Ai n $ m 0 Dz I L� .y x I eN YI C R D➢ A r � - � a / n a o � o n cm I Io a v,r a t ' rr _____ y =0 O O m O O o A Z q y < S _ � a y oo °a o A O pP OQ I VI r sT Z NO � Nm � 8 n Erg Kent City Council Meeting Date September 20, 2005 Category Consent Calendar 1. SUBJECT: LEASE AGREEMENT FOR CELL TOWER AT PUMP STATION #5 — ACCEPT AND AMEND BUDGET 2. SUMMARY STATEMENT: Authorize the Mayor to sign the lease agreement with VoiceStream PCS III for placement of a cell tower at Pump Station #5, and approve the expenditure of funds in the Public Works budget. There are numerous cell towers leased throughout the City. VoiceStream PCS III is requesting a cell tower be placed at Pump Station #5 The monthly fee of$1,300.00 generated from the lease will be credited to the Public Works Water Fund Budget and VoiceStream PCS III will pay for all costs associated with installation of the cell tower. 3. EXHIBITS: Lease agreement 4. RECOMMENDED BY: Parks & Human Services Committee (Committee, Staff, Examiner, Commission, etc.) 5. FISCAL IMPACT Expenditure? X Revenue? X Currently in the Budget? Yes No X If no: Unbudgeted Expense: Fund 41005550 Amount $1,300.00 Unbudgeted Revenue: Fund 41005550.56260 Amount $1,300 00 6. CITY COUNCIL ACTION: Councilmember moves, Councilmember seconds DISCUSSION: ACTION: Council Agenda Item No 6H PARKS, RECREATION AND COMMUNITY SERVICES John M. Hodgson. Director Phone 253-S56-5100 • Fak 253-S56-6050 KEN T Address 220 Fourth 4.enue S Wn 5H INGTON Kepi,l["A 98032SS95 DATE: September 15, 2005 TO: Kent City Council Parks and Human Services Committee FROM: Charlie Lindsey, Superintendent of Facilities THROUGH: John Hodgson, Director of Parks, Recreation & Corrnnunity Services SUBJECT: Lease Agreement for Cell Tower at Purap Station#5 - Accept and Amend Budget :MOTION: Move to recommend Council authorize the Mayor to sign the lease agreement with VoiceStream PCS III, for placement of a cell tower at Pump Station #5, � and approve the expenditure of funds in the Public Works budget. SUMMARY: There are numerous cell towers leased throughout the city VoiceStream PCS III 1 is requesting a cell tower be placed at Pump Station Number Five. The monthly fee of S1,300 00 generated from the lease �N ill be credited to the Public Works Water Fund Budget and VoiceStream PCS III will pay for all costs associated �.N ith installation of the cell tower EXHIBITS: Lease Agreement BUDGET IMPACT: Unbudgeted S I,300 00, impacts revenue account no 41005550 56260. f i 1 t LEASE AGREEMENT THIS LEASE AGREEMENT ("Lease") is entered into by and between the CITY OF KENT, Washington municipal corporation ("Landlord") and VOICESTREAM PCS III CORPORATION, a Delaware corporation, with its principal office in Washington located at 12920 SE 38" Street, Bellevue, Washington 98006 ("Tenant") BACKGROUND A. Landlord is the owner in fee simple of a parcel of land located in the City of Kent, King County, Washington, legally described on the attached Exhibit A (the "Property"). B. Tenant is in the communications business and desires to lease that portion of the Property which is legally described on the attached Exhibit B, together rvtth a nonexclusive access easement, which is legally described on the attached Exhibit C C. Accordingly, the parties are entering into this Lease on the terms and conditions set forth below. AGREEMENT In consideration of their mutual covenants, the parties agree as follows, 1 Leased Premises. Landlord leases to Tenant and Tenant leases from Landlord that portion of the Property legally described on the attached Exhibit B (the "Premises") together with a non-exclusive easement for ingress, egress and utilities over the adjacent real property legally described on the attached Exhibit C (the "Access Easement"). This Lease is not a franchise nor is it a permit to use the City of Kent's rights-of-way. Any such franchise or permit must be obtained separately from Landlord. 2. Term and Option to Renew. This Lease shall commence on the earlier of. (a)nine (9) months after the date of this Lease has been signed by both parties, or (b) the date Tenant commences construction of its improvements on the Premises or installation of utilities within the Access Easement (the "Commencement Date"), and end on the date that is one day before the five year anniversary of the Commencement Date Additionally, so long as Tenant is not in default of this Lease, Tenant shall have the option to renew this Lease for two (2) additional five (3) year periods subject to the adjustment of Monthly Rent as described in Section 3 Should Tenant exercise its option to renew this Lease, that option must be exercised in writing and delivered to Landlord at least ninety (90) calendar days before the end of the then-current term. LEASE AGREEMENT—Page 1 of 15 (Landlord Cin q( ent Tenant bomesiream PCS IIICorporalron) (August 17, 2005) 3. Rent a. Tenant agrees to pay Landlord as Monthly Rent, without notice or demand, the sum of ONE THOUSAND THREE HUNDRED AND NO/100 DOLLARS ($1,300 00), plus leaschold tax, if required by law, at a rate established by the State of Washington, currently 12.84%, commencing on the Commencement Date Subsequently, the Monthly Rent shall be paid in advance, on or before the first day of the month during the term hereof Monthly Rent shall be mailed to- City of Kern- 220 Fourth Avenue South, Kent, Washington 98032, Attention Facilities Superintendent. b. Tenant shall pay Landlord a Late payment charge equal to five percent (5%) of the Monthly Rent for any payment not paid within five (5) calendar days of when due. Any amounts not paid when due shall bear interest until paid at the rate of two percent (2%) per month. c The Monthly Rent during years two (2) through five (5) of each five (5) year term shall be increased effective as of each anniversary of the Commencement Date by an amount equal to the greater of four(4) percent or the percentage increase in the CPI over the CPI for the month 12 months prior to the adjustment date. "CPI" means the Consumer Price Index for All Urban Consumers, U.S City Average, All Items, issued by the Bureau of Labor Statistics for the United States Department of Labor (19821-84 = 100), If the CPI is converted to a different standard reference base or otherwise revised, the adjustment set forth in this paragraph shall be made with the use of the conversion formula published by the Bureau of Labor Statistics. d. The Monthly Rent during the first year of a renewal term will be adjusted to Market Rent. As used herein, "Market Rent" means the rent paid for similar uses on similar properties in the greater Puget Sound area. If Landlord and Tenant cannot agree upon Market Rent within thirty (30) days after Tenant presents its proposal for Market Rent, then the matter shall be settled by binding arbitration by a single arbitrator who has experience in telecommunications real estate leasing matters Tenant shall present its proposal for Market Rent when it exercises its option to renew the Lease. The arbitration will be administered by JAMS if the parties have not otherwise agreed to use a different arbitrator or arbitration process Each party will submit to the arbitrator and each other at least ten (10) days in advance of the hearing their best offers of Market Rent The arbitrator shall award the Market Rent figure that is closest to the true Market Rent The costs of the arbitration shall be borne by the Tenant Each party will bear the cost of its own attorney's fees e Monthly Rent, and all other consideration to be paid or provided by Tenant to Landlord shall constitute Rent and shall be paid or provided without offset. 4. Use of Premises. a. Tenant shall use the Premises for the purpose of locating, maintaining, replacing, removing, operating, and upgrading a wireless communications antenna on a pole Tenant shall also use the Premises for the purposes of constructing, maintaining, replacing, removing, operating, and upgrading related wireless communication ground equipment, support LEASE AGREEMENT—Page 2 of 15 (Landlord CtpOffeni, Tenant f oicesiream PCs III Corporation) (August 17,2005) structures, and cables The antenna and related facilities shall collectively be referred to as the "Antennae Facilities ' The Premises shall be used for no other purpose. b. Tenant shall, at its expense, comply with all applicable present and future federal, state, and local laws, ordinances, rules and regulations (including laws and ordinances relating to health, radio frequency emissions, other radiation and safety) in connection with the use, operation, maintenance, construction and/or installation of the Antennae Facilities and/or the Premises, 5. Tenant Improvements, Plans. Bonds. a (1) Tenant may improve the Premises by constructing the Antennae Facilities Tenant is required, as part of this Lease, to complete all the items listed in Exhibit D. Tenant is responsible to provide all labor, materials, and equipment necessary for the items listed in Exhibit D Piior to commencing construction, Tenant shall submit plans and specifications drawn to scale for all improvements to Landlord for Landlord's written approval, such approval not to be unreasonably withheld No improvement, construction, installation or alteration shall be commenced until plans for such work have been approved by the Landlord and all necessary permits have been properly issued Landlord's Parks, Recreation & Community Services Department shall give such approval or provide Tenant with its requests for changes within thirty (30) working days of Landlord's receipt of Tenant's work plans. The plan and specifications review schedule described above does not apply to the City- of Kent acting as a governmental entity issuing permits and other approvals for the work Tenant is requesting to perform (2) All improvements shall be constructed in a workmanlike manner without the attachment of any liens to the Property and shall be completed in compliance with all permits, applicable laws, rules, ordinances. and regulations if any lien is tiled, such lien shall be remov ed from the Property or bonded over, per RC W 60 04 161, within twenty (20) days of the lien being recorded with the King County Recorder's office. b. (1) The Tenant shall remove the Antennae Facilities from the Premises upon termination of the Lease. Such removal shall be done in a workmanlike and careful manner and without interference or damage to any other equipment, structures or operations on the Premises, including use of the Premises by Other Provides as described in Section 6 a, Landlord, or any of Landlord's assignees. (2) Upon removal of the improvements (or portions thereof) as provided above in subpart (1). Tenant shall restore the affected area of the Premises and Access Easement, normal wear and tear excluded, to the reasonable satisfaction of the Landlord. (3) All costs and expenses for the removal and restoration to be performed by Tenant pursuant to subparts (1) and (2) above shall be borne by Tenant, and Tenant shall hold Landlord harmless from any portion thereof. (4) If Tenant requests permission not to remove all or a portion of the improvements upon termination of this Lease per section 5.b(1), and Landlord consents to such non-removal, title to the affected improvements shall thereupon be transferred to Landlord and the same thereafter shall be the sole and entire property of Landlord, and Tenant shall be relieved LEASE AGREEMENT—Page 3 of 15 (Landlord Crry ofAenr Tenant Vorcevreanr PCSI11 Corporation) (August 17,2005) of its duty to otherwise remove same. All other alterations, improvements and structures located or constructed on the Premises (except for movable equipment and trade fixtures), shall become the property of Landlord upon termination of the Lease, except that Landlord may, b} written notice to Tenant, require Tenant to remove all such improvements upon termination of the Lease. Any personal property, equipment, or other improvements which are not removed upon termination of this Lease shall become the property of Landlord, at Landlord's option. C. Tenant shall annually post a bond (or, at Tenant's option, a letter of credit) from a surety or bank reasonably acceptable to Landlord, in the amount of Fifteen Thousand Dollars ($15,000 000) Landlord may use these funds at the termination of the Lease for removal of all improvements and repair of the Premises and Access Easement should Tenant not comply with the requirements of this section. 6. Use bti Other Providers. a. Tenant shall also design and construct all ancillary support facilities, including any support buildings, so that l (one) additional wireless communications provider (-Other Prm,ider") will have an adequate amount of space to house its own support equipment. b. Tenant shall cooperate with each new Other Provider that Landlord leases to in connection with the Other Provider locating and placing its antennas and other facilities on the Premises and in the ancillary support facilities. C. Each new Other Provider shall be solely responsible for the cost of locating and placing its equipment on the Premises. The Other Provider shall also be responsible for any liabilities that arise from the Other Provider's use of the Premises 7. Net Lease Landlord shall not be required to make any expenditures of any kind in connection with this Lease or to make any repairs or improvements to the Premises or Access Easement The parties agree that this is a net Lease intended to assure Landlord the rent reserved on an absolute net basis, In addition to the Monthly Rent reserved above, Tenant shall pay to the parties entitled thereto all taxes, assessments, insurance premiums, maintenance charges, and any other direct charges, costs and expenses against the Premises and Access Easement which may be contemplated under any provisions of this Lease 8. Maintenance. a. Tenant shall, at its own expense, maintain the Premises, Access Easement, and all improvements, equipment and other personal property on the Premises in good working order, condition and repair. Tenant shall keep the Premises and Access Easement free of debris and anything of a dangerous, noxious or offensive nature or which would create a hazard or undue vibration, heat, noise or interference, Tenant shall install, maintain, and replace, when necessary, all landscaping required by Exhibit D and City of Kent permits b. In the event the Landlord or any other tenant undertakes painting, construction or other alterations on the Landlord's Property described in Exhibit A, Tenant shall take reasonable measures, at Tenant's cost, to cover Tenant's equipment. personal property or Antennae Facilities and protect them from paint and debris fallout which may occur during the LEASE AGREEMENT—Page 4 of 15 (Landlord C;ry of Kent Tenant t oice stream PCS III Corporation) (August 17,2005) painting, construction or alteration process. This requirement shall not be interpreted as a waiver of any claim Tenant may raise either against Landlord or any third party due to the Landlord or the third parties' negligence, so long as Tenant has taken reasonable measures to protect Tenant's equipment, property, and facilities as required above. 9. Access Landlord and its agents shall have the right to enter the Premises at reasonable times to examine and inspect the Premises. provided, however, that in no event will Landlord, its employees, agents or contractors remove, relocate, alter, modil}• or otherwise tamper with Tenant's Antennae Facilities. Tenant shall have 24-hours-a-day, 7-days-a-week access to the Premises at all times during the term of this Lease. I0. Utilities. Cenant shall, at its expense, separately meter charges for the consumption of electricity and other utilities associated with its use of the Premises and shall timely pay all costs associated therewith. 11. License Fees. Tenant shall pay, as they become due and payable, all fees, charges, taxes and expenses required for licenses and/or permits required for or occasioned by Tenant's use of the Premises and Access Easement. 12. Approvals; Compliance with Laws Tenant's use of the Premises and Access Easement is contingent upon its obtaining all certificates, permits, zoning, and other approvals that may be required by any federal, state or local authority Tenant shall erect, maintain and operate its Antennae Facilities in accordance with site standards, statutes, ordinances, rules and regulations now in effect or that may be issued thereafter by the Federal Communications Commission or any other governing bodies. 13. Interference a Tenant agrees that its construction and operations will in no way affect the security or operation of Landlord's facilities at the Property Tenant acknowledges that Landlord's use of the Property may have associated security issues. b. Tenant's installation, operation, and maintenance of its transmission facilities shall not damage or interfere in any way with Landlord's activities on the Property Tenant agrees to correct, as soon as possible and in all instances within 24 hours of notice of the interference, all such actions which interfere with Landlord's use of the Property. If the interference cannot be corrected without Tenants wireless signal coverage goals from the Premises being materially impacted, Tenant shall have the right to terminate the Lease. C. Before approving the placement of Antennae Facilities, Landlord may obtain, at Tenant's expense, an interference study indicating whether Tenant's intended use will interfere with any existing communications facilities on the Property. d. In the event that an Other Provider requests a tease from Landlord to place any type of antennae or transmission facility on the Premises, Landlord shall submit a proposal complete with all technical specifications reasonably requested by Tenant to Tenant for revieNk for noninterference; however, Landlord shall not be required to provide Tenant with any specifications or information claimed to be of a proprietar} nature by the third party. The Other LEASE AGREEMENT—Page 5 of 15 (Landlord CayofKent Tenant doicestream PCS III Corporation) (August 17,2005) t Provider shall be responsible for the reasonable cost of preparing the technical specifications for its proposed transmission facility. Tenant shall have fifteen (15) calendar days following receipt of said proposal to make any objections thereto, and failure to make any objection within said fifteen (15) calendar day period shall be deemed consent by Tenant to the installation of Antennae or transmission facilities pursuant to said proposal If Tenant gives notice of objection due to interference during such fifteen (15) calendar day period and Tenant's objections are verified by Landlord to be valid, then Landlord shall not proceed with such proposal unless the Other Provider modifies the proposal in a manner determined, in Landlord's reasonable judgment, to adequately eliminate reasonable interference concerns asserted by Tenant In that case, Landlord nia,, proceed with the proposal. In the event the Other Provider actually interferes with the operations of Tenant, Landlord shall make good faith efforts to have the Other Provider cease operation until the interfeience can be eliminated A govetrurtental unit may be allowed to place Antennae or other communications facilities on the Premises as long as there is no interference with Tenant's use. 14. Default It shall be a default if: a. Tenant defaults in the payment of Monthly Rent or any other sums payable to Landlord when due, and does not cure such default within fifteen (15) calendar day s after written notice from Landlord; b. Tenant abandons or vacates the Premises for a period longer than thirty (34) days, C. Tenant fails, at any time during this Lease (including optional renewal periods), to conform or comply with any local land use, regulatory, or building permit conditions issued by the City in connection with the construction, operation, or maintenance of Tenant's facilities contemplated in this Lease; d. Tenant is adjudicated as bankrupt or makes any assignment for the benefit of creditors; C. Tenant becomes insolvent: or f. Either party defaults in the performance of any other covenant or condition of this Lease and does not cure such other default within thirty (30) calendar days after written notice from the non-defaulting party specifying the default at issue; provided, however, that neither party dill be in non-monetary default under this subsection if it commences curing such default with such 30-day period and thereafter diligently prosecutes the cure to completion. 15 Cure by Landlord. In the event of any default of this Lease by Tenant, the Landlord may at any time, after notice, cure the default for the account of and at the expense of the Tenant. If Landlord is compelled to pay or elects to pay any sum of money or to do any act which will require the payment of any sum of money or is compelled to incur any expense, includine reasonable attorney fees in instituting, prosecuting or defending any action to enforce the Landlord's rights under this Lease, the sums so paid by Landlord. with all interest, costs and damages shall be deemed to be Additional Rent and shall be due from the Tenant to Landlord on the first day of the month following the incurring of the respective expenses. If Tenant disputes LEASE AGREEMENT—Page 6 of 15 (Landlord Crry of Kent, Tenant t Dios rtream PCS Ill Corporation) (August 17,11005) the appropriateness of the Additional Rent in good faith, Tenant will pay such Additional Rent .'under protest". Any payment under protest by Tenant shall not be considered an admission of liability or a waiver of Tenant's rights under this Agreement, and such payment shall be subject to refund if Tenant's position is upheld by a court. 16, Optional Termination Except for instances of default as set forth in Section 14, this Lease may be terminated (a) by Tenant if it is unable to obtain or maintain any license, permit, or other governmental approval necessary for the construction and/or operation of the Antennae Facilities or Tenant's business, (b) by Landlord upon ninety (90) da,,s prior written notice to Tenant, if the Landlord decides, in its sole discretion for any reason, to discontinue use of the Premises for city or public purposes, (c) by Landlord if it determines through verifiable scientific evidence that Continued use Ol the PI e1111Ses by Tenant is in tact a [u health, rea[ CC ii�,uilr�h, safety or welfare, (d) by Landlord if Tenant's use of the Premises violates applicable laws or ordinances; or (e) by Landlord if Tenant loses its license to provide PCS/cellular service for any reason, including, but not limited to, non-renewal, expiration, or cancellation of its license. 17 Dama>zes and Attorne'y's Fees. In the event of an instance of Tenant's default as identified in Section 14 or Tenant's optional termination in Section 16, Landlord shall be entitled to the amount of unpaid rent accrued through the date of termination, and liquidated damages in the amount of six (6) months rent If it becomes necessary for the Landlord to use an attorney and/or bring suit for damages or possession, or if Tenant shall bring any action for any relief against Landlord, declaratory or otherwise, arising out of this Lease, the prevailing party shall have and recover against the other party in addition to the cost allowed by law, such sum as the court may adjudge to be reasonable attorney's fees 1 18. Termination; Notice. Except as otherwise provided above in Section 16(b), any notice of termination pursuant to Section 16 shall be given to the other party in writing at least thirty (30) calendar days prior to the termination date in accordance with the provision of Section 28. 19. Damage or Destruction. If Tenant's improvements or any portion thereof are destroyed or damaged so as to materially hinder effective use of the Premises through no fault or negligence of Tenant, Tenant may elect to terminate this Lease upon thirty (30) calendar days' written notice to Landlord In such event, Tenant shall promptly remove all improvements from the Premises as set forth in Section 5(b) above. This Lease (and Tenant's obligation to pay rent) shall terminate upon Tenant's fulfillment of the obligations set forth in the preceding sentence, at which termination Tenant shall be entitled to the reimbursement of any Monthly Rent prepaid by Tenant. Landlord shall have no obligation to repair any damage to any portion of the Premises or Access Easement. 20. Condemnation. In the event the Premises are taken by eminent domain, this I Lease shall terminate as of the date title to the Premises vests in the condemning authority. In the event a portion of the Premises is taken by eminent domain, either party shall have the right to terminate this Lease as of said date of title transfer, by giving thirty (30) days written notice to the other party In the event of any taking under the power of eminent domain, Tenant shall not be entitled to any portion of the reward paid for the taking and the Landlord shall receive full amount of such award. Tenant shall hereby expressly waive any right or claim to any portion of I all damage awards, whether awarded as compensation for diminution in value of the leasehold or LEASE AGREEMENT—Page 7 of 15 (Landlord Ghl of Kent Tenant i oicestream PCS ID Corporation) (August 17,2005) the fee of the Premises. Tenant shall have the right to claim and recover from the condemning authority, but not from Landlord, such compensation as may be separately awarded or recotierable by Tenant on account of any and all damage to Tenant's business and any costs or expenses incurred by Tenant in moving/removing its equipment, personal property, Antennae Facilities,and leasehold improvements. 21 Indemnity. a. Disclaimer of Liabilitv, Landlord shall not at any time be liable for injury or damage occurring to any person or property from any cause whatsoever arising out of Tenant's negligent construction, maintenance, repair, use, operation, condition or dismantling of the Premises, Access Easement, Ienant's Antennae Facilities, and any other impro-vements made by Tenant, b. Indemnification: Tenant shall, at its sole cost and expense, indemnify and hold harmless Landlord and all associated. affiliated, allied and subsidiary entities of Landlord, now existing or hereinafter created, and their respective officers, boards, commissions, employees, agents, attorneys, and contractors (hereinafter referred to as "Indemnitees"), from and against: (1) Any and all liability, obligation, damages, penalties, claims, liens, costs, charges, losses and expenses (including, without limitation, reasonable fees and expenses of attorneys, expert witnesses and consultants), which may be imposed upon, incurred by or be asserted against the Indemnitees by reason of any intentional or negligent act or omission of Tenant, its personnel, employees, agents, contractors or subcontractors, resulting in personal injury, bodily injury, sickness, disease or death to any person or damage to, loss of or destruction of tangible or intangible property, libel, slander, invasion of privacy and unauthorized use of any trademark, trade name, copyright, patent, service mark or any other right of any person, firm or j corporation, which may arise out of or be in any way connected with the construction, installation, operation, maintenance, use or condition of Tenant's Antennae Facilities, Tenant's use of the Premises and Access Easement, Tenant's other improvements, or Tenant's failure to comply with any federal, state or local statute, ordinance or regulation. (2) Any and all liabilities, obligations, damages, penalties, claims, liens, costs, charges, losses and expenses (including, without limitation, reasonable fees and expenses of attorneys, expert witnesses and other consultants), which are imposed upon, incurred by or asserted against the Indemnitees by reason of any claim or lien arising out of work, labor, materials or supplies provided by or supplied to Tenant, its contractors or subcontractors, for the installation, construction, operation, maintenance or use of the Premises, Access Easement, Tenants Antennae Facilities, Tenant's other improvements. Tenant shall cause such claim or lien covering Landlord's Property to be discharged or bonded per the requirements in section 5 (a)(2) (3) Notwithstanding the foregoing, Tenant shall not indemnity, defend or hold hannless Landlord for any liabilities, obligations, damages, penalties, claims, liens, costs, charges, losses or expenses (including, without limitation, reasonable fees and expenses of attorneys, expert witnesses and other consultants), arising out of the Indemnitee's negligence or willful misconduct LEASE AGREEMENT—Page 8 of 15 /Landlord City of Kent, Tenant i oicestream PCS 111 Corporation) (Ragas/17 2003) C. Assumption of Risk: Tenant undertakes and assumes for its officers, agents, affiliates, contractors and subcontractors and employees all risk of dangerous conditions, if any, on or about the Premises and Access Easement. Tenant's assumption of risk shall not apply to any latent defects or other dangerous situation, if Landlord knows or should know that defect or situation to exist but has not disclosed that information to Tenant d Defense of Indemnitees: In the event any action or proceeding shall be brought against the Indemnitees by reason of any matter for which the Indemnitees are indemnified hereunder. Tenant shall, upon notice from any of the Indemnitees, at Tenant's sole cost and expense, resist and defend the same; provided however, that Tenant shall not admit liability in any such matter on behalf of the Indemnitees without the v,,iitten consent of Landlord and provided further that Indemnitees shall not admit liability for, nor enter into any compromise or settlement of, any claim for which they are indemnified hereunder, without the prior written consent of Tenant e. Notice, Cooperation and Expenses- Landlord shall give Tenant prompt notice of the making of any claim or the commencement of any action, suit or other proceeding covered by the provisions of this Section 21 Nothing herein shall be deemed to prevent Landlord from cooperating with Tenant and participating in the defense of any litigation by Landlord's attorney so long as the participation is coordinated with Tenant's attorney. Tenant shall pay all expenses incurred by Landlord in response to any such actions, suits or proceedings These expenses shall include all out-of-pocket expenses such as the reasonable value of any services rendered by the Landlord's attorney; the actual expenses of Landlord's agents, employees, or expert witnesses, and disbursements and liabilities assumed by Landlord in connection with such suits, actions or proceedings Provided, however, these expenses shall not include attorneys' fees for services that are unnecessarily duplicative of services provided Landlord by Tenant. 22. Insurance. a, Type and Amount. During the term of the Lease, Tenant shall maintain, or cause to be maintained, in full force and effect and at its sole cost and expense, the following types and limits of insurance. (1) Worker's Compensation insurance meeting applicable statutory requirements and employer's liability insurance with minimum limits of One Hundred Thousand Dollars ($100,000) for each accident ' (2) Comprehensive Commercial General Liability insurance written on an occurrence basis with limits no less than One Million Dollars ($1,000,000) combined single limit per occurrence and in the aggregate for bodily injury, personal injury and property damage. The policy shall provide blanket contractual liability insurance for all written contracts, and shall include coverage for products and completed operations liability, independent contractor's habihty; coverage for property damage from perils of explosion, collapse or damage to underground utilities, commonly known as XCU coverage. LEASE AGREEMENT—Page 9 of 15 (Landlord Cin of Kent Tenant Votcestream PCS III Corporation) (August 17,2005) (3) Automobile Liability insurance covering all owned, hired, and non-owned vehicles in use by Tenant, its employees and agents, with personal protection insurance and property protection insurance to comply with the provisions of state law with minimum limits of One Million Dollars ($1,000,000 00) as the combined single limit for each occurrence for bodily injury and property damage. (4) Excess Liability insurance with limits not less than Four Million Dollars ($4,000,000.00) per occurrence and in the aggregate. (5) At the start of and during the period of any construction, builders all-risk insurance, together with an installation floater or equivalent property coverage covering cables, materials, machinery- and supplies of any nature whatsoever which are to be used in or incidental to the installation of the Antennae Facilities. Upon completion of the installation of the Antennae Facilities, Tenant shall substitute for the foregoing insurance policies of fire, extended coverage and vandalism and malicious mischief insurance on the _Antennae Facilities The amount of insurance at all times shall be representative of the insurable values installed or j constructed. (b) All policies other than those for Worker's Compensation shall be written on an occurrence and not on a claim made basis. (7) The coverage amounts set forth above may be met by a combination of underlying and umbrella policies so long as in combination the limits equal or exceed those stated. b. Additional Insureds- All policies, except for business interruption, the policies specified in Section 22 a(5) and worker's compensation policies, shall list Landlord and its officials. officers, employees, agents and assigns, as their respective interests may appear, as additional insureds (herein referred to as the "Additional Insureds'). Each policy, which is to be endorsed to list Additional Insureds hereunder, shall contain cross-liability wording, as follows: In the event of a claim being made hereunder by one insured for which another insured is or may be liable, then this policy shall cover such insured against whom a claim is or may be made in the same manner as if separate policies had been issued to each insured hereunder C. Evidence of Insurance: Certificates of insurance or self insurance for each insurance policy required to be obtained by Tenant in compliance with this Section, together with a copy of the endorsement listing the Landlord as additional insured shall be provided to Landlord prior to the Commencement Date, Tenant shall also provide Landlord written evidence of payment of required premiums annually during the term of the Lease. Tenant shall immediately advise Landlord of any claim or litigation that may result in liability to Landlord. LEASE.AGREEMENT—Page 10 of 15 (Landlord ',ly of Kew Tenant t oieestreara PCS 111 Corporation) (August 17,I005) i d. Cancellation of Policies of Insurance: All insurance policies maintained pursuant to this Lease shall contain the following endorsement: IAt least thirty (30) days prior written notice shall be given to Landlord by the insurer of any intention (a) not to renew, (b) to cancel or (c) to reduce the coverage afforded under this insurance policy Such notice shall be given by registered mail to the Landlord. re. Insurance Companies: All insurance shall be effected under valid and enforceable policies, insured by insurers licensed to do business by the State of Washington or surplus line carriers on the State of Washington Insurance Commissioner's approved list of companies qualified to do business in the State of Washington. All insurance carriers and surplus line carriers shall be rated A- (VIII) or better by A.M. Best Company. f. Deductibles- Any payment of deductible or self-insured retention shall be the sole responsibility of the Tenant. g. Contractors: Tenant shall require that each and every one of its contractors and their subcontractors who perform work on the Premises and Access Easement j carry, in full force and effect, workers' compensation. comprehensive public liability and automobile liability insurance coverage of the type which Tenant is required to obtain under the terms of this paragraph with appropriate limits of insurance. It Review of Limits: Once during each calendar year during the term of this Lease, Landlord may review the insurance coverage to be carried by Tenant If Landlord reasonably determines that higher limits of coverage are necessary to protect the interests of Landlord or the Additional Insureds, Tenant shall be so notified and shall obtain the additional limits of insurance, at its sole cost and expense 23. Hazardous Substance Indemnification Tenant represents and warrants that its use of the Premises and Access Easement will not generate any hazardous substance, and it will not negligently or_intentionally store, or dispose, or transport over the Premises and Access Easement any hazardous substance in violation of any federal or state law Tenant further agrees to hold Landlord harmless from and indemnify Landlord against any release of any such hazardous substance and any damage, loss, or expense or liability resulting from such release including all attorneys' fees, costs and penalties incurred as a result thereof except any release caused by the negligence of Landlord, its employees or agents Similarly. Landlord warrants that the Premises and Access Easement are free of any hazardous substances and agrees to indemnify and hold Tenant harmless from the Landlord's negligent or intentional introduction of any 1 hazardous substance by Landlord "Hazardous substance" shall be interpreted broadly to mean any substance or material defined or designated as hazardous or toxic waste, hazardous or toxic material, hazardous or toxic or radioactive substance, or other similar term by any federal, state or local environmental Iaw, regulation or rule presently in effect or promulgated in the future, as such laws, regulations or rules may be amended from time to time, and it shall be interpreted to include, but not be limited to, any substance which after release into the environment will or may reasonably be anticipated to cause sickness, death or disease LEASE AGREEMENT—Page I I of 15 (Landlord City of Kent Tenant [oicestream PCS[11 Corporation) (August 17,2005) 24 Holding Over. Any holding over after the expiration of the term hereof, with the consent of the Landlord, shall be construed to be a tenancy from month to month and Monthly Rent shall be paid by Tenant at two times the rents herein specified and shall otherwise be on the terms and conditions herein specified, so far as applicable. 25 Subordination to Mortgage Any mortgage now or subsequently placed upon any Property of which the Premises are a part shall be deemed to be prior in time and senior to the rights of the Tenant under this Lease Tenant subordinate all of its interest in the leasehold estate created by this Lease to the lien of any such mortgage Tenant shall, at Landlord's request, execute any additional documents necessary to indicate this subordination within ten (10) days of written request by Landlord; provided that such documents include provisions by which Landlord's mortgagees agree that Tenant's use and quiet enjoyment of the Premises and Access Easement will not be disturbed so long as Tenant is not in default under this Lease. 26 Acceptance of Premises. With the exception of latent defects and any hazardous substance contamination existing prior to the Commencement Date, by taking possession of the Premises, Tenant accepts the Premises and Access Easement in the condition existing as of the Commencement Date Landlord makes no representation or warranty with respect to the condition of the Premises or Access Easement 27. Estoppel Certificate. Tenant shall, at any time and from time to time upon not less than thirty (30) days prior request by Landlord, deliver to Landlord a statement in writing certifying that (a) the Lease is unmodified and in full force (or if there have been modifications, that the Lease is in full force as modified and identify the modifications); (b) the dates to which rent and other charges have been paid; (c) so far as the person making the certificate knows, Landlord is not in default under any provisions of the Lease, and (d) such other matters as Landlord may reasonably request 28 Notices. All notices, requests, demands, and other communications hereunder shall be in writing and shall be deemed given if personally delivered or mailed, certified mail, return receipt requested, or by a nationally recognized courier service, to the following addresses: If to Landlord, to: Facilities Manager City of Kent 220 Fourth Avenue South Kent, WA 98032 With a copy to: City Clerk City of Kent 220 Fourth Avenue South Kent, WA 98032 LEASE AGREEMENT—Page 12 of 15 (Landlord C,4 of i eni Tenant Vo+cestream PCS III Corporation) t 4ugust 17 2005) I jIf to Tenant, to: VoiceStream PCS III Corporation c/o T-Mobile 12920 SE 381h Street Bellevue, WA 98006 Attn PCS Lease Administrator With a copy to- VoiceStream PCS III Corporation c/o T-Mobile 19807 North Creek Parkway North Bothell, WA 98011 Attn: Lease Administration Manager 29. Assignment and Sublettine. a. Tenant shall not sublet all or any part of the Premises. Tenant shall not assign its interest in this Lease without Landlord's prior written consent, which will not be unreasonably withheld. Consent by Landlord to any assignment shall not constitute a waiver of the necessity of such consent to any subsequent assignment This prohibition against any assignment or subletting shall be construed to include a prohibition against any subletting or assignment by operation of law. If this Lease is assigned, Landlord may collect rent from the assignee, and apply the net amount collected to the rent and other obligations of Tenant hereunder reserved. Consent by Landlord to an assignment shall not be deemed a waiver or release of Tenant from the further performance by Tenant of the covenants on the part of Tenant hereunder contained. b. If Tenant is a corporation, partnership, or limited liability company, and if the control thereof changes at any time during the term of this Lease, then Landlord at its option may, by giving ten (10) days prior written notice to Tenant, declare such change a breach of this section unless Landlord has previously approved in writing the new controlling party or unless Landlord's approval is not required pursuant to Section 29 d, below jc Any person or entity to which this Lease is assigned pursuant to the provisions of the Bankruptcy Code, 11 USC §101, et seq , shall be deemed without further act to have assumed all of the obligations of Tenant arising under this Lease on and after the date of such assignment Any such assignee shall upon demand execute and deliver to Landlord an instrument confirming such assumption Any monies or other considerations payable or 1 otherwise to be delivered in connection with such assignment shall be paid to Landlord, shall be the exclusive property of Landlord, and shall not constitute property of the Tenant or of the estate of Tenant within the meaning of the Bankruptcy Code. Any monies or other 1 considerations constituting Landlord' s property under the preceding sentence not paid or delivered to Landlord shall be held in trust for the benefit of Landlord and be promptly paid to Landlord, d. Notwithstanding anything to the contrary in this Lease, Tenant shall have the right to assign this Lease without Landlord's consent to any of Tenant's partners or affiliates. LEASE AGREEMENT—Page 13 of 15 (Landlord Crty,o(fenr Tenant Vorcestream PCS IIICorporatron) (August 17,2005) 30 Other Leases Nothing in this Lease shall preclude Landlord from leasing other space for communications equipment to any person or entity viho ma} be in competition with Tenant, or any other party 31. Successors and ASSiQnS. This Lease shall run with the Premises and be binding upon and inure to the benefit of the parties, their respectn e successors, personal representatives and assigns 32, Non-Waiver. Failure of either party to insist on strict performance of any of the conditions, covenants, terms or provisions of this Lease or to exercise any of its rights hereunder shall not waive such rights. but such party shall have the rights to enforce such rights at any time and take such action as might be lawful or authonzed hereunder, either in law or equity The receipt of any sum paid by Tenant to Landlord after a breach of this Lease shall not be deemed a waiver of such breach unless expressly set forth in writing. 33. Taxes. I a. Tenant shall pay all real and personal property taxes (or payments in lieu of taxes) and assessments for the Premises and Access Easement that are directly the result of Tenant's communication equipment, if any, which become due and payable during the term of this Lease All such payments shall be made, and evidence of all such payments shall be provided to Landlord, at least ten (10) days prior to the delinquency date of the payment Tenant shall pay all taxes on its personal property on the Premises. b. Tenant shall indemnify Landlord from any and all liability, obligation, damages, penalties, claims, liens. costs. charges, losses and expenses (including, without limitation, reasonable fees and expenses of attorneys, expert witnesses and consultants), which may be unposed upon, incurred by or be asserted against Tenant in relation to the taxes owed or assessed on Tenant's Property on the Premises. C. 1f the methods of taxation in effect at the Commencement Date of the Lease are altered so that in lieu of or as a substitute for any portion of the property taxes and special assessments now imposed on property there is imposed a tax upon or against the rentals , payable by Tenant to Landlord, Tenant shall pay those amounts in the same manner as provided for the payment of real and personal property taxes. 34. Miscellaneous. a. Landlord and Tenant represent that each, respectively, has full right, ' power, and authority to execute this Lease. b. This Lease constitutes the entire agreement and understanding of the parties and supersedes all offers, negotiations, and other agreements of any kind There are no representations or understandings of any kind not set forth herein. Any modification of or amendment to this Lease must be in writing and executed by both parties. C. This Lease shall be construed in accordance with the laws of the State of Washington. Venue and unsdiction of any lawsuit arising out of the performance or obligations LEASE AGREEMENT—Page 14 of 15 (Landmrd Cuy of Kent Tenant I ocestream PCS III Corporation) august 17, 1005) i of this lease shall be in the King County Superior Court, Kent Regional Justice Center, Kent, Washington d If any term of this Lease is found to be void or invalid, such invalidity shall not affect the remaining terms of this Lease, which shall continue in full force and effect. THIS LEASE IS EXECUTED and shall become effective on the last date indicated below, LANDLORD: TENANT: CITY OF KENT VOICESTREANI PCS III CORPORATION By- By: Print Name Jim White Print Name Its: Mayor Its: Date: Date: APPROVED AS TO FORM: ATTEST: 1 Kent Law Department BRENDA JACOBER, KENT CITY CLERK 1 P Cn,d MES6pmFilakOS63%Vmcoe mLem.PompSO onNo5 dm i t ' LEASE AGREEMENT—Page 15 of 15 (Landlord Cin of Kent Tenant i ace slreane PCS X Corporation) (August P,1005) i EXHIBIT A LEGAL DESCRIPTION OF LANDLORD'S PROPERTY r Situated in the County of King, State of Washington. t r r 1 r r r r r r r r r LEASE AGREEMENT RE, PUMP STATION NO 5 -EXHIBIT A (Landlord City of Kent Tenant G oicestream PCS III Corporateon L r EXHIBIT B LEGAL DESCRIPTION OF PREMISES 1 r r r r r 1 r r r 1 r r LEASE AGREEMENT RE- PUMP STATION NO 5 -EXHIBIT B (Landlord C v of Kent. Tenant Voicestream PCS III Corporation EXHIBIT C LEGAL DESCRIPTION OF ACCESS EASEMENT LEASE AGREEMENT RE PUMP STATION NO 5 —EXHIBIT C (Landlord Cin of Kent Tenant Votcestream PCS III Cornoratton I r EXHIBIT D SCOPE OF WORK TO BE COMPLETED BY VOICESTREAM PCS III CORPORATION r r r r r r 1 1 LEASE AGREEMENT RE PUMP STATION NO.5 -EXHIBIT D (Landlord City o(Kent Tenant {ocestream PCS X Corporation Kent City Council Meeting Date September 20, 2005 Category Other Business 1. SUBJECT: MUNICIPAL LOT BLOCK DEVELOPMENT AGREEMENTS AND ' RESOLUTION — AUTHORIZE AND ADOPT 2. SUMMARY STATEMENT: This proposed resolution provides authorization to enter into various agreements as part of a proposal to redevelop certain property in downtown Kent, commonly called the "Municipal Lot Block." This block is located between Smith and Harrison Streets on the north and south, and 2"d and 4th Avenues on the east and west. The city owns part of the property within this block. The redevelopment proposal includes rearrangement of property ownership on the block and conveyance of a part of the city-owned land in exchange for construction of a structured parking garage with at least 350 parking stalls open to the public, of those 350 stalls, at least 70 would be dedicated in perpetuity as public parking spaces, a commitment for ongoing operations and maintenance of all parking areas at the developers cost, a new city park, construction of a 74 unit hotel, 64 condominiums, 56 senior condominiums, a water/pool feature, retail use, and a restaurant City staff will make a presentation on this matter This is not a public hearing, however council may, if it chooses, invite public comment, which would be limited to three minutes per speaker. After the staff presentation and public input, if any, council will be asked to consider this resolution. 3. EXHIBITS: Project Springboard Summary of Legal Agreements, Resolution and its re erence exhibits—Exhibit A, Land Pooling Agreement and Exhibit B, Replacement Parking Agreement ' 4. RECOMMENDED BY: Mayor (Committee, Staff, Examiner, Commission, etc.) 5. FISCAL IMPACT Expenditure? N/A Revenue? N/A Currently in the Budget? Yes No ' If no. Unbudgeted Expense: Fund Amount $ ' Unbudgeted Revenue. Fund Amount $ 6. CITY COUNCIL ACTION: Councilmember CZ"624-k— moves, Councilmember d�e� seconds Adoption of Resolution No.� , authorizing the Mayor to execute all documents necessary ' to implement the Municipal Lot Block redevelopment proposal, including those referenced by this resolution in substantially the same form as attached, subject to modification and approval of the final terms and conditions by the City Attorney, and with the understanding that the land pooling transaction may be modified to accept assignment of a short-term lease for the restaurant property on that block DISCUSSION: ' ACTION: _77Y1 C Council Agenda Item No. 7A i PROJECT SPRINGBOARD SUMMARY OF LEGAL AGREEMENTS Land Pooling Agreement Through a series of lot boundary adjustments, the City of Kent ("City"), Springboard Property Investment LLC ("SPI"), and MBA Harrison Square 1I LLC and Meeker Street Law Building LLC (together 'Bruce Anderson") wish to engage in property exchanges to facilitate redevelopment by Springboard Holdings LLC ("Developer") of most of the block into the Town Square Plaza, a city park, and a private mixed use project After the exchange, SPI intends to contribute its property to Developer in exchange for an interest in the proposed development project Bruce Anderson's property will not be part of the proposed development project but is subject to minimum parking standards upon development of the property per the Land Pooling Agreement The development will include the Town Square Plaza (a city park), a hotel, condominiums, senior condominiums, retail space, a water park, a small conference center, and a structured parking garage with dedicated public parking. Replacement Parkm�,yAgreement As part of the first phase of the development, Developer will construct a 4 level parking structure with a minimum of 350 publicly accessible parking spaces available 24 hours a day, 7 days a week, initially with a 3-hour maximum parking limit. There shall be 70 spaces dedicated to public parking at all times, the remaining spaces will be available to the public on a shared basis The Developer can issue special use parking permits without a time limit to hotel guests and condo dwellers and Second Avenue North Associates (a garage investor) can issue similar special use permits equal in number to the number of stalls in which they invest. There will be no initial charge for parking, and the project can only charge for parking if the City charges for parking on or off street in the adjacent ' area. The Developer is obligated to complete the garage, which will be secured by a first hen against Developer's entire project site in favor of the City. If the garage is not completed, the City will obtain the entire project site for the default. The Developer will also be responsible for all operations and maintenance charges associated with the garage and for providing a mechanical chase room and public restrooms associated with the adjacent Town Square Plaza A parking easement reserves the City's rights associated with the completed garage. t r RESOLUTION NO. A RESOLUTION of the city council of the city of Kent, Washington, authorizing the mayor to execute all documents necessary to implement a development proposal for a downtown city block, commonly known as the "Municipal Lot Block," which is bounded on the north and south by Smith and Harrison Streets and on the east and west by Second and Fourth Avenues in the city of Kent. RECITALS A. The city of Kent owns portions of certain real property located in downtown Kent and more commonly known as the"Municipal Lot Block." This block is bounded on the north by Harrison Street, on the east by Second Avenue South, on the south by Harrison Street, and on the west by Fourth Avenue South. B. The block contains approximately 132,200 square feet and contains seven separate legal parcels, together with a public alley that connects Fourth and Second Avenues. The city of Kent owns approximately 88,586 square feet of property within this block, including the public alley. The remaining property within the block is owned by the following separate entities: MVA Harrison Square I, L.L.C., a Washington limited liability company; MVA Harrison Square II, L.L.C., a Washington limited liability company; Meeker Street Law Building, L.L.C., a Washington limited liability company; and Springboard Properties Investment, L.L.C., a Washington I Municipal Lot Block-Authorize ' Mayor to Sign Necessary Documents r limited liability company. Collectively, these entities, along with the city of Kent, own r all property located within the Municipal Lot Block. C. A developer, Springboard Holdings, L.L.C., a Washington limited ' liability company, has entered into a series of negotiations with the individual parties that own the Municipal Lot Block to bring forth a development proposal to redevelop the Municipal Lot Block consistent with Downtown Commercial Enterprise zoning and the Kent Station Planned Action Ordinance. The proposed development would construct a hotel with approximately 74 rooms, a condominium complex with approximately 64 condominiums and 56 senior condominiums, a health spa, a water park feature, a restaurant site, a conference center, a fitness center, and retail space. The development proposal also includes a structured parking garage with not less than 350 stalls A portion of the block on its southwest corner, to be owned by one or a combination of the Harrison Square and Meeker Street Law entities, will be developed r separately. The city of Kent will retain approximately 33,500 square feet on the eastern portion of the block for the Town Square Plaza, a city park This is the , substance of the development proposal, however, these components may change somewhat based on market factors as the project moves from design to construction. D. The city will convey that portion of its property holdings within the block not devoted to public park to the developer in consideration for the following elements ' 1. A minimum of 350 publicly accessible parking spaces available 24 hours a day, seven days a week, with not more than a 3-hour maximum parking , limit. Of these approximately 350 spaces, at least 70 exclusive public, city parking spaces are to remain open to the public, and within the city's exclusive control, in perpetuity, 2. Responsibility for and cost of all operations and maintenance of ' the structured parking garage will be assumed entirely by the developer, at no additional cost to the city; 2 Municipal Lot Block-Authorize Mayor to Sign Necessary Documents r r 3. Public restrooms to serve the development and Town Square Plaza to be provided by the developer; and 4. Adequate space within the development buildings to house utilities required to support the Town Square Plaza. The number of permanently dedicated public parking stalls further reflects the appraised fair market value of the property transferred from the city to the developer, divided by the cost to construct each structured parking stall. The remaining spaces in ' the garage will be available to the public on a shared basis. The developer will be allowed to issue a limited number of special use parking passes without a time limit to hotel guests and condominium dwellers. In addition, Second Avenue North Associates, a garage investor, may issue similar special use permits to tenants in a number equal to the number of stalls in which it invests. E. In addition to the consideration stated above, the substantial private investment proposed for the Municipal Lot Block will improve the financial stability and general economic vitality of downtown Kent and the entire city. The proposed redevelopment will provide additional housing downtown in close proximity to the Kent commuter rail and bus transit center, increase pedestrian activity downtown, create additional jobs, and will expand and diversify the city's tax base. The provision of safe, convenient, accessible and attractive public parking in the downtown retail core will increase retail activity, indirectly improve public safety, prevent traffic congestion, and improve vehicular access and circulation within the city, all of which are traditional and well-recognized public purposes. F. The current property ownership of the Municipal Lot Block, shown on Exhibit A to the Land Pooling Agreement, is fragmented and not conducive to the current development proposal. Accordingly, the parties have agreed to rearrange ownership of the various parcels to form uniform blocks of ownership conducive to this development, as shown on Exhibit C to the Land Pooling Agreement. The agreement providing for this reassemblage of properties, entitled the "Land Pooling 3 Municipal Lot Block-Authorize Mayor to Sign Necessary Documents Agreement," is attached as Exhibit A and incorporated by this reference. As soon as the various property ownerships are reassembled and rearranged pursuant to this Land ' Pooling Agreement, the developer and the city will be positioned to construct both the development proposal and the Town Square Plaza park. , G. Once the Land Pooling Agreement has been executed, the city will have conveyed its ownership in property not reserved for the Town Square Plaza park to the developer for the consideration stated above. As security for the developers performance of these conditions, the city has imposed specific deed restrictions as well as obtained a mortgage securing the city's interest in the performance of the developer's obligations The proposed agreement to address replacement parking issues on the Municipal Lot Block as part of this development, known as the "Replacement Parking Agreement," is attached as Exhibit B, which is incorporated by this reference. ' H. Having spent a significant amount of time and effort to negotiate and draft these agreements and the overall development proposal, the city council has determined that it is appropriate to approve the development proposal and authorize the ' mayor to execute all documents attendant to this proposal at this time. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES HEREBY RESOLVE AS FOLLOWS: RESOLUTION SECTION 1. — Recitals Incorporated as Findings The foregoing recitals are , incorporated as the findings of the city council for the city of Kent for the purposes of this resolution. , 4 Municipal Lot Block-Authorize Mayor to Sign Necessary Documents r SECTION Z — Authorization for Mayor to Sign Necessary Documents. The ' city approves this development concept and proposal, specifically including the land transactions, and authorizes the mayor to sign all documents necessary to effect this development on the Municipal Lot Block within the city of Kent, specifically including, without limitation, the Land Pooling Agreement and Replacement Parking Agreement substantially in the form attached to this resolution. The mayor is authorized to sign other documents necessary to complete this transaction, subject to review and approval of the final terms and conditions by the city attorney. SECTION 3. — Severability. If any section, subsection, paragraph, sentence, clause or phrase of this resolution is declared unconstitutional or invalid for any reason, such decision shall not affect the validity of the remaining portions of this resolution. SECTION 4. —Ratification. Any act consistent with the authority and prior to the effective date of this resolution is hereby ratified and affirmed. ' SECTION S. —Effective Date. This resolution shall take effect and be in force immediately upon its passage. PASSED at a regular open public meeting by the city council of the city of Kent, Washington,this day of September,2005. CONCURRED in by the mayor of the city of Kent this day of September, 2005. JIM WHITE,MAYOR 5 Municipal Lot Block-Authorize ' Mayor to Sign Necessary Documents ATTEST: BRENDA JACOBER, CITY CLERK APPROVED AS TO FORM: ' TOM BRUBAKER, CITY ATTORNEY I hereby certify that this is a true and correct copy of Resolution No. ' passed by the city council of the City of Kent, Washington, the day of September, 2005. BRENDA JACOBER, CITY CLERK 6 Municipal Lot Block-Authorize Mayor to Sign Necessary Documents r r r r r r r r r Exhibit A LAND POOLING AGREEMENT 1 r r 1 1 r r r r POOLING AGREEMENT , THIS POOLING AGREEMENT (the "Agreement") is entered into this day of ' September, 2005 by and among CITY OF KENT, a Washington municipal corporation ("City"), MBA HARRISON SQUARE I LLC, a Washington limited liability company and MBA HARRISON SQUARE II LLC, a Washington limited liability company (collectively, "Harrison"), MEEKER STREET LAW , BUILDING LLC, a Washington limited liability company ("Meeker Street")(Hamson and Meeker Street are hereinafter referred to collectively as "Anderson'), SPRINGBOARD PROPERTIES INVESTMENT LLC, a Washington limited liability company ("SPI") and SPRINGBOARD HOLDINGS L.L.0 , a ' Washington limited liability company("Developer") with reference to the following facts. RECITALS , A, City, Anderson, and SPI are the owners of certain real property located in the City of Kent as depicted on the map annexed hereto as Exhibit A and by this reference incorporated herein ' (collectively, the "Property"). The real property owned by City is hereinafter referred to as the City Property. The real property owned by Anderson following completion of the exchange described in paragraph 9 is hereinafter referred to collectively as the Anderson Property. The real property owned by , SPI is hereinafter referred to as the SPI Property. Anderson and SPI are hereinafter referred to collectively as "Private Owners". City, in its capacity as the owner of a portion of the Property, and Private Owners are hereinafter referred to individually as"Owner"and collectively as"Owners". B. Owners desire to enter into this Agreement to provide for a redevelopment of the Property through coordinated negotiations with Developer,boundary line adjustments of the Property into lots that, following completion of the boundary line adjustment process and the property exchanges described below, will facilitate such redevelopment on the terms and conditions hereinafter set forth. C. City is interested in redeveloping a portion of the City Property with an approximately ' 34,000 square foot town square plaza. The remainder of the City Property (the "City Replacement Parking Property's and the SPI Property is depicted on the map annexed hereto as Exhibit C and is hereinafter referred to in this Agreement as the "Project Site". Developer is interested in redeveloping the ' Project Site with a privately owned mixed-use development as more particularly described below. D. SPI intends to exchange a portion of the SPI Property for real property currently owned by City and to contribute the SPI Property following such exchange to Developer in exchange for an interest in Developer on the terms and conditions hereinafter set forth. E. A portion of the City's planned town square plaza is located on property currently owned ' by Hamson Harrison is willing to exchange the real property owned by Harrison for the Harrison Exchange Property owned by City as hereinafter defined on the terms and conditions hereinafter set forth. NOW, THEREFORE, in consideration of the foregoing recitals and other good and valuable consideration,the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: AGREEMENT ' I. Standstill Agreement. Each Owner agrees not to sell, transfer, convey, encumber or lease its portion of the Property until after September 30, 2005 (the "Standstill Period") In the event that on or ' before September 30, 2005 (i) SPI has entered into an agreement with Developer to contribute the SPI Property to Developer in exchange for an interest in Developer; (ii) the parties have executed this ' Agreement;and(iii)City has entered into ii replacement parking agreement with Developer,the Standstill Period shall be extended until December 15, 2005. There shall be no further extension of the Standstill ' Period without the written consent of all Owners. 2. Reconfiguration of the Prooertv. The Property consists of a City block bordered on the north by Smith Street, on the west by Fourth Avenue, on the south by Harrison Street and on the east by ' Second Avenue and contains approximately 140,000 square feet. The Property currently consists of seven(7) separate legal lots and a public alley which connects Fourth Avenue and Second Avenue and is owned by the City. The approximate square footage, location and ownership of each of the existing lots constituting the Property is depicted on the trap annexed hereto as Exhibit A and by this reference incorporated herein. Prior to September 30, 2005, the legal description of each of the existing legal lots will be attached to this Agreement as Exhibits B-1 through B-7 and will thereafter become part of this ' Agreement. Owners agree to jointly petition for vacation of the existing public alley (and in connection therewith each Owner agrees to quitclaim their interest in the vacated alley to the City at the closing described in paragraphs 3 and 6 below). Owners shall also jointly enter into any boundary line ' adjustment deemed reasonably necessary by City, Anderson and Developer to permit redevelopment of the Project Site, with the Project, redevelopment of the southeast corner of the Property with an approximately 34,000 square foot town square plaza on land to be owned by the City and exchange by Harrison of real property owned by Harrison for the Harrison Exchange Property. The approximate configuration, square footage, location and ownership of each of the lots following vacation of the existing public alley and completion of the boundary line process is depicted on the map annexed hereto as Exhibit C and by this incorporated herein. The dimension and reconfiguration of the Property and each of the legal lots, including the legal descriptions for each of the lots following completion of the alley vacation(and dedication of their respective interests in the vacated alley by each of the Private Owners to City)and boundary line adjustment process,shall be expressly subject to approval by each of the Owners and Developer, which consent shall not be unreasonably withheld, conditioned or delayed and shall be subject to the normal boundary line adjustment regulatory process. The completion of the alley vacation and boundary line adjustment process and execution and delivery of confirming deeds in connection with both the alley vacation and the boundary line adjustment shall occur immediately prior to the closing of, and shall be expressly contingent upon the closing of the exchange of the real property owned by Harrison for the Harrison Exchange Property, the exchange of a portion of the SPI Property for real property owned by the City and the contribution or exchange of the entire Project Site (as depicted on Exhibit C) by City and SPI to Developer for redevelopment with the Project on or before December 15, 2005. ' 3. Simultaneous Closine. The Owners and Developer agree that (a) the alley vacation(and corresponding conveyance of the vacated alley to the City), (b) boundary line adjustment (and corresponding conveyance of confirming deeds to the various parcels), (c) exchange of a portion of the ' SPI Property with the City and contribution by SPI of the remaining SPI Property to Developer, (d)exchange of the City Replacement Property, and(e) exchange of the real property owned by Harrison for the Harrison Exchange Property, shall be closed simultaneously on or before December 15, 2005 ("Closing Date'), and each is expressly contingent upon the completion of the other property transactions described in this Agreement. The Owners and Developer have designated LandAmerica Title Insurance Company to act as the title company and escrow agent to coordinate the simultaneous closings of the various transactions described herein. Each Owner and Developer shall be responsible for the payment of real estate excise tax,if any, and associated recording costs in connection with the completion of the alley vacation,boundary line adjustments,various property exchanges and recordation of deeds as necessary to ' accomplish the foregoing with respect to that portion of the Property owned by such Owner. Each Owner who transfers property pursuant to this Agreement shall provide, at its cost, its transferee with a standard coverage policy of title insurance in an amount equal to the then assessed valuation of such property. ' Any transferee shall have the right to obtain additional title insurance coverage or endorsements on any -2- K Q009MODOOVDasORS�A232i property obtained by it in connection with the transactions contemplated by this Agreement, at its sole ' cost and expense,but the availability of such additional title insurance coverage or endorsements shall not be a condition precedent to the consummation of the transactions contemplated herein. Each Owner and ' its transferee shall pay 1/2 the escrow fees associated with the portion of the Property owned by such Owner. 4. Termination of Leases. Liens and other Rights of Possession. Prior to September 30, ' 2005, each Owner of the Property shall have reviewed and approved the condition of title to any real property to be transferred to it in connection with the transactions contemplated under this Agreement and must establish to the reasonable satisfaction of the other Owners and Developer, that it has the right to , terminate,or has terminated, all existing leases, licenses or other rights to occupy all of any portion of the Property and will be able to deliver possession of its portion of the Property to the exchanging Owner or Developer on the Closing Date set forth in paragraph 6 below, free and clear of all such leases, licenses , and other rights of possession and has either released or has obtained the written commitment of any mortgagee or lienholder to release any mortgage, deed of trust or other lien which affect such Owner's Property on or prior to Closing (collectively, "Liens"). Each Owner shall be solely responsible for the , termination of all such leases, licenses and other rights of possession, the relocation of any tenants or occupants on its portion of the Property and release or termination of all such Liens prior to Closing and shall protect,defend,indemnify and hold the other Owners harmless from any and all damages, liabilities, ' costs, expenses and losses (including, without limitation, reasonable attorneys' fees and costs) ansing out of such lease termination and relocation and termination of Liens. The provisions of this paragraph 4 shall survive the termination of this Agreement or the consummation of the transactions contemplated ' under this Agreement. Developer will be responsible for demolishing any existing buildings located on the Property as of Closing at its sole cost and expense. 5. Redevelopment of Project Site. Owners agree to work together cooperatively to jointly ' reconfigure the legal lots constituting the Property (excluding the Anderson Property) and City and SPI agree to coordinate negotiations with Developer for acquisition or exchange of the Project Site and subsequent redevelopment of the Project Site with a privately owned mixed-use development consisting of an approximately 66 room hotel, including reception area, lobby,a conference center of approximately 2,300 square feet and an indoor water park of not less than 6,000 square feet (collectively, the "Hotel Improvements"), approximately 52 units of market rate residential condominiums, approximately 22,000 ' square feet of restaurant and ground floor retail space, approximately 52 units of market rate senior condominium housing, a private street connecting Smith and Harrison Streets together with structured parking for approximately 320 cars(collectively,the"Project"). A general site plan for redevelopment of , the Project Site with the Project is attached hereto as Exhibit D and by this reference incorporated herein. As part of the Project, Developer shall provide sufficient parking stalls on the Project Site (excluding public streets adjoining the Project Site) to meet a minimum parking ratio of 1.0 stalls per bedroom for any residential unit, and 2.0 stalls per 1,000 rentable square feet for any portion of the Project Site ' developed for office, commercial or retail use (the "Project Parking Ratios"). For purposes of determining the Project Parking Ratios,the Hotel Improvements shall be considered a residential use and not a commercial use. In addition the Developer shall provide additional parking stalls for exclusive ' public parking in the amount set forth in the replacement parking agreement to be negotiated between City and Developer. The Project shall be constructed in phases. The Parking Garage shall be constructed as part of Phase One of the Project and City shall not be obligated to issue building permits for the ' remainder of the Project until after its acceptance of the public parking easement pursuant to the Replacement Parking Agreement as more particularly described in paragraph 7 below. 6_ Disposition of SPI Property and Contribution Agreement Between SPI and Developer. ' SPI agrees to exchange a portion of the SPI Property for real property currently owned by the City and agrees to enter into negotiations with Developer to contribute the remaining SPI Property (following such ' -3- K M093�00008%DRS0RS A232J exchange and after completion of the boundary line adjustment process) to Developer for redevelopment as part of the Project and shall use reasonable efforts to execute a contribution agreement with Developer on or before September 30, 2005. The contribution agreement must contain the following terms and conditions: (i)feasibility period not to exceed forty-five (45) days with closing on or before December 15, 2005; (ii)all exchange or contribution agreements, including the exchange of the real property owned by Harrison for the Harrison Exchange Property and the exchange of the City Replacement Parking Property for a public parking easement to use parking stalls in the parking garage to be constructed by Developer as part of the Project pursuant to the City replacement parking agreement described in paragraph 7 below, must be closed simultaneously, and each contribution or exchange is expressly conditioned on the contribution or exchange of the remainder of the Property; (iii)contribution of the SPI Property for an interest in Developer is for the sole purpose of developing the Project on the Project Site;and(iv)construction of the Parking Garage must commence on or before March 31,2006. 7. City Rglacement Parking AMMot. That portion of the City land (following completion of the boundary line adjustment process and the exchange with SPI and the exchange with Harrison) which will not be retained by the City is referred to herein as the "City Replacement Parking Property". City agrees to enter into negotiations with Developer to exchange the City Replacement Parking Property for a perpetual easement for public parking in the structured parking garage to be constructed by Developer as part of Project and shall use reasonable efforts to execute a Replacement Parking Agreement with Developer on or before September 30, 2005. The Replacement Parking Agreement shall require Developer to design, develop and complete construction of a multi-level above- ground structured parking garage containing approximately three hundred twenty(320)parking spaces for multi-passenger motor vehicles (the "Parking Garage") and grant the City a perpetual public parking easement which shall provide that a certain number of parking spaces in the Parking Garage shall be available to members of the general public for short term public parking at all times (the "Exclusive Public Parking Stalls'J. In addition to the Exclusive Public Parking Stalls, the public parking easement shall provide that members of the general public shall have the right to park in any open parking stall in the Parking Garage on a first-come, first-serve basis twenty four(24)hours a day, seven(7)days a week, together with rights of pedestrian and vehicular access to and from the Parking Garage and the public streets adjoining the Property including ingress and egress by means of the private street. The precise number of Exclusive Public Parking'Stails to be granted City pursuant to the public parking easement will ' be determined based upon the value of the City Replacement Parking Property and the cost of each parking stall to be located in the Parking Garage which shall be determined by dividing the actual construction cost for the Parking Garage (excluding the cost of land and excluding the cost of any modifications made to the Parking Garage to support an office, commercial structure or use other than short term public parking to be constructed on top of the parking garage,if any)divided by the number of parking stalls. The City and the Developer shall establish the actual cost of each parking stall following completion of schematic design of the Project and prior to closing of the exchange of the City Replacement Parking Property for the public parking easement, and will adjust the number of Exclusive Public Parking Stalls accordingly; provided, however, that in no event shall the number of Exclusive Public Parking Stalls be less than suety-five (65) parking stalls. As part of the public parking easement, Developer will agree not to charge members of the public for the right to park in the Parking Garage until such time as the City charges for parking on any City streets located within the Kent Station Planned Action Ordinance Area, or any City-owned surface parking lots or parking structures located within the ' Kent Station Planned Action Ordinance Area. The form of the public parking easement will be an exhibit to, and approved by the City, Developer and any of Developer's Project lenders or investors prior to execution of the Replacement Parking Agreement. Upon Closing, the Developer will execute a deed of trust in favor of City encumbering the Project Site ("City Mortgage") to secure the obligations of Developer under the Replacement Parking Agreement to design, develop, and complete construction of the Parking Garage and grant City the public parking easement. The City Mortgage shall be a first lien upon the Project Site and shall not be subordinated to any construction or other loan now or hereafter -4- W_V2W93a00WQRWRS obtained by Developer. Upon final completion of the Parking Garage and satisfaction of other terms and conditions set forth in the replacement parking agreement,the City will accept the perpetual easement for public parking in the Parking Garage and reconvey the City Mortgage. The disposition of the City Replacement Parking Property will be closed on or before December 15, 2005,and simultaneous with the closing of the Private Owners' contribution or exchange agreements for the remainder of the Property. The City may negotiate for the acquisition of additional public parking stalls in excess of the number of parking stalls equal to the value of the City Replacement Parking Property at the same cost per parking stall The Replacement Parking Agreement shall contain each of the agreed elements set forth in paragraph 6 above and such additional terms and conditions as City and Developer may negotiate in their sole discretion; provided,however, that the City Mortgage and the City's public parking easement shall have priority over any financing now or hereafter recorded against the Project Site. Developer's equity investors and Project lenders shall consent to the City's public parking easement as a condition to Closing. 8. Operation of Parking Garage. City's obligation to exchange the City Replacement Parking Property is expressly contingent on the negotiation of an agreement by City and Developer on or before September 30, 2005, setting forth Developer's responsibility to operate and maintain the Parking Garage to be constructed as part of the Project in first-class order, condition and repair in accordance with practices prevailing in first class urban centers with multi-level structured parking, including, but not limited to, the City's Exclusive Public Parking Stalls. Developer shall agree to manage the Parking Garage so as to maximize the availability of parking stalls for short term parking, without charge, by members of the general public on a first come/first serve, unreserved basis. Such parking management agreement may be combined with the City's public parking easement agreement. 9. Harrison Pr_perty: Redevelopment of Anderson Property. Harrison and the City agree to exchange the real property owned by Harrison for the Harrison Exchange Property as identified on the map annexed hereto as Exhibit C and by this reference incorporated herein. The exchange of the real property owned by Harrison for the Harrison Exchange Property shall be closed simultaneously with the exchange by SPI of a portion of the SPI Property for real property owned by the City and the contribution of the SPI Property (following such exchange) by SPI to Developer described in paragraph 6 above and the exchange of the City Replacement Parking Property pursuant to the Replacement Parking Agreement more particularly described in paragraph 7 above. This exchange of properties is subject to the following additional terms and conditions: As part of such exchange, the Anderson Property shall be subject to a restrictive covenant (which shall constitute a covenant running with the land in favor of City and Developer) restricting use and development of the Anderson Property as follows. (i)in the event Anderson redevelops (Le, construct buildings for office, residential, commercial or retail use) the Anderson Property, Anderson agrees that any such redevelopment shall contain sufficient on-site parking to meet a minimum parking ratio of 1.0 stalls per residential unit (not per bedroom), and 2.0 stalls per 1,000 rentable square feet for office, commercial or retail use plus an additional 45 parking stalls representing the parking stalls needed to provide parking for tenants of property owned by Meeker and Harrison south of W. Harrison Street; and(ii) Anderson shall not charge the public for the right to park in any parking spaces developed as part of such redevelopment until such time as the City charges for ' parking on any City streets located within the Kent Station Planned Action Ordinance Area,or any City- owned surface parking lots or parking structures located within the Kent Station Planned Action Ordinance Area, provided, however, that such restrictive covenant shall not prevent Anderson from providing and charging on a monthly basis for parking to tenants, their employees or invitees under the terms of any space lease(s)of any development hereinafter constructed on the Anderson Property to. No Brokers. Each Owner represent to all other Owners that they have dealt directly with one another and there are no brokers, finders or other consultants who are entitled to payment of any brokerage fee, finder's fee or other compensation to connection with the sale or exchange of the Property -5- ici2009M000I0 0Rs\oRs n232J contemplated by this Agreement. Each Owner agrees to indemnify, protect, defend and hold all other Owners harmless from any and all damages, liabilities, costs, expenses and losses (including, without limitation, reasonable attorneys' fees and costs) which any Owner may sustain or incur by reason of a claim for any such brokerage fee, finder's fee or other compensation if such claim is based upon any agreement alleged to have been made by such Owner. The provisions of this Section 10 shall survive the termination of this Agreement or the sale, exchange or contribution of the Property by and among Owners and Developer. 11. City Approval. City's obligations under this Pooling Agreement are expressly subject to approval by the City Council on or before September 30, 2005. City's obligations under the Replacement Parking Agreement, the public parking easement and the parking management agreement described under paragraphs 7 and 8 above are expressly subject to approval by the City Council on or before September 30, 2005 Nothing contained in this Agreement or the proposed Replacement Parking Agreement, public parking easement and the parking management agreement shall constitute a waiver of the City's governmental authority relating to development of the Project including, but not limited to, zoning and land use decisions,permitting or any other governmental approvals. 12. Miscellaneous. (a) Sharing of Expenses. Owners agree to share the cost of the appraisal of the Property and the fees and expenses associated with preparation of the boundary line adjustment, including costs of any surveying work necessary and the preparation of any legal descriptions and confirming deeds, which costs and expenses shall be paid by the Owners in proportion to their percentage ownership interest in the Property. All such costs and expenses shall be paid promptly following receipt of invoices or other documentation thereof, and shall accrue interest at the rate of twelve percent (12%) per annum until paid in full if not paid within thirty (30) days following receipt of such invoice or other supporting documentation. (b) Attorneys' Fees. Each Owner will be responsible for payment of the legal fees of its counsel in the event of any litigation or other proceeding brought to enforce or interpret or otherwise arising out of this Agreement. (c) Entire Agreement: Modification. This Agreement and the exhibits attached hereto constitutes the entire understanding between the parties hereto with respect to the Standstill Period and the Owner's respective rights, duties and obligations during the Standstill Period. Neither this Agreement nor any provision hereof may be waived, modified, amended, discharged or terminated except as expressly provided herein or by an instrument in writing signed by the party against which the enforcement of such waiver, modification, amendment, discharge or termination is sought. (d) Captions. The captions in this Agreement are inserted for convenience of reference only and in no way define,limit or describe the scope or intent of this Agreement. (e) Time is of the Essence Time is of the essence of this Agreement and of each covenant and agreement that is to be performed at a particular time or within a particular period of time. However, if the final date of any period which is set out in any provision of this Agreement or the applicable closing date falls on a Saturday, Sunday or legal holiday under the laws of the United States, or the State of Washington, then the time of such period or the closing date, as the case may be,shall be extended to the next date which is not a Saturday, Sunday or legal holiday. -6- K Q00931000001DRStDR5_A232J (f) Further Acts. The parties shall execute and deliver such further instruments and documents, and take such other further actions,as may be reasonably necessary to carry out the intent and provisions of this Agreement. , (g) No Joint Venture Nothing contained in this Agreement shall create any partnership, joint venture or other arrangement between Owners other than that of owners of contiguous parcels of real property. The parties intend that the rights, obligations and covenants in this Agreement shall be enforceable only by the Owners. No term or provision of this Agreement shall be for the benefit of any person, firm, organization or corporation not a party hereto, and no such other person, firm, organization or corporation shall have any right or cause of action hereunder. To the extent allowed by law, the Owners agree to keep any appraisals of the Property completely confidential. (h) Fair Construction. This Agreement has been drafted by legal counsel to the City. Prior to execution and delivery of this Agreement, each Owner has had an opportunity to consult with legal counsel of its choice. Each of the provisions of this Agreement has been reviewed and negotiated by, and represents the combined work product of, all Owners. No presumption or other rules of construction which would interpret the provisions of this Agreement in favor of or against the party preparing the same shall be applicable in connection with the construction or interpretation of any of the provisions of this Agreement. The provisions of this Agreement shall be construed as a whole according to their common meaning and consistent with the other provisions contained herein in order to achieve the objectives and purposes of this Agreement. (i) Notices. All notices, demands, requests, consents and approvals which may, or are required,to be given by any Owner to any other Owner hereunder shall be in writing and shall be deemed to have been duly given if delivered personally,sent by a nationally recognized overnight delivery service or by facsimile transmission, or, if mailed or deposited in the United States mail and sent by registered or certified mail, return receipt requested, postage prepaid, to the address listed following each Owner's signature below, or to such other address as any Owner hereto may from time to time designate in writing and deliver in a like manner. All notices shall be deemed given three(3)business days following the date when mailed or one (1) business day following the date when delivered or faxed (provided the fax machine has issued a printed confirmation of receipt). 0) Counterparts. This Agreement may be executed in one or more identical counterparts, each of which shall constitute an original and all of which shall constitute but one original and may be delivered by facsunile transmission. (k) Governing Law; Venue. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Washington, and the parties agree that venue shall lie exclusively in King County Superior Court. The parties hereto consent to the jurisdiction of the King County Superior Court and waive the right to file suit elsewhere. (1) Exhibits. All exhibits shall be reviewed and approved by the Owners and Developer and attached to this Agreement on or before September 30,2005. -7- K 0009310000B1ORSlORS A232J IN WITNESS WHEREOF, the Owners and Developer have executed this Agreement as of the date and year first above wntten. "CITY" "HARRISON" CITY OF KENT, MBA HARRISON S I LLC a Washington municipal corporation a Washingto t' ite 1' il' c mp y RE By. By: Name: M. Anderson, Manager Title: Address: Address: Facsimile: Facsimile: MBA HARRISON SQ II LLC, APPROVED AS TO FORM a Washington i tedP ty c an Name: By: Title: B ce erson, Manager Address: Facsimile: "MEEKER STREET" "SPI" MEEKER STREET L BUILDING LLC, SPRINGBOARD PROPERTIES a Washingt 'ted ' ili co y INVESTMENTS, LLC, a Washington limited liability company By: . Bruc Anderson, Manager By: Name: Address: Title: Address: Facsimile: iFacsimile- [signatures continued next page] erg_ K=0931000MDRSQRS_A232J "DEVELOPER' SPRINGBOARD HOLDINGS L.L.C., a Washington limited liability company By: Name: Title: Address: Facsimile: i T -9- K=093100001%DRS%DRS_A232J Nk ' 4 4 F r■ n i•I ; I I r I! W cr ce 30SSV N 3AV ONZ yy .r i ■Al k: 65- 9 AND r t•' NOS113UNt/3:)nua � . IdJ:r • i` ►�' Z u. _ LaJjbs865"9 p NOSM30Ny3:)fli1g, , . + • M ir ■ 1 � c �4 O -, � .� .tit jr I 5 >Ilel jib Exhibits B-1 through B-7 !� Place holder for the legal description of each of the existing legal lots to be added as Exhibits B-1 through B-7 in accordance with Section 2 of the Land Pooling Agreement, entitled"Reconfiguration of the Property," and as approved by staff. i i ! i ! i + I �{ • � 1 ti gal 00 .. t. ■.t SON . . �5 1 = i CITY Tolkasm 4 SQUARE ANDERSON LAZA Y� PROPERTY �r V3.--tn. 'A -A;& a AN lid, MW. 4 Y47Yiywaw 'l."o IIII ,. it. Itl . -,. Y. •. _: -,:...»._p1L, _-, ':t.t .rtr.•.�?dds._ ..4.0.lY+Mrfr:.al'�`�►'.-.cw. . 10 tap • -1 � . i Exhibit D TO POOLING AGREEMENT 3 SUSm9cm CAP"LEVELS OVER RETAI �;000RO�S��ISIr�07QB�� AND GRNO LEVEL GARAGE-112.300 SF TOTAL SMITH OVER GRNO FUR RETAIL I 7{T STAI.LSTOTAL 16.2068E i FIR 1 RETAIL•16,747 SF 87,880 SF TOTAL I 1 RETAIL RETAIL 2972 SF O,tS6 SF 81tTA< �AOO NOA' �N28 46N RESTAURANT OONFERENCE SPA 95953E AM OL WY ,96 20 SF 1,8008E 1 I � w 1 1 I +2B 88STALLB/21A88 SF 1 1 2888E/STALL lz ge Mam 1 f --- !f1 HARRISON —}--------------- ------------- —� - ® 0 10 20' SD' tar Plan 8 Devebprmnt LLC 27JULYO5 REV 050M SPRINGBOARD GROUND FLOOR 4 LEVEL PKG GARAGE SCHEME 1 Exhibit B 1 REPLACEMENT PARKING AGREEMENT TABLE OF CONTENTS Page 1. Incorporation of Recitals; Definitions ................................................................................ 2 2. Project Springboard Development Project...................... .............................. .................... 2 2.1 Project Elements ............. ............................................................................ .......... 2 2.2 General Parking Requirements.......................... .................................................... 3 2.3 Parking Garage, Minimum Design Criteria...... .. ... ............................................ 3 ' 3. Acquisition of Property......................................... . ......................................................... . 4 3 1 Contribution of SPI Land. . ....... ........................ ................................ ................ . 4 3.2 Exchange of Harrison Property...... ........................ . ... . ................................... . 4 3.3 Disposition of Replacement Parking Site; Public Parking Easement..................... 4 3.4 Description of Public Parking Easement.. .............................................................4 4. Fair Value Determination of Replacement Parking Site; Public Parking Easement ......... 5 4.1 Fair Value Determination of Exchange Properties................................................. 5 42 Security, City Mortgage; First Lien on Property...... ................ ............................ 5 43 Terms of City Mortgage. . . .. ..... . ........... .... . ..... . .................... .................... 6 4.4 Acceptance of Public Parking Easement Upon Final Completion of Parking Garage; Satisfaction of City Mortgage.......................... ...................... .... 6 4.5 Escrow Agent.. . ............... .. ............................ .................................................... 6 5. Design Development of Project Springboard Improvements and the Parking Garage. . . . .. . . . ...... ... ... . . .... . ........ . ......... . .......................... 6 5 1 Construction of Project Springboard Improvements and Parking Garage.............. 6 52 Construction Drawings and Detailed Specifications for Parking Garage............... 6 5.3 Resubmittals............................................................................................... . .......... 7 5.4 Design Development for Remainder of Project Springboard Improvements......... 7 5 5 Construction in Phases ..... . ..... .......... . 8 5.6 Permits; Costs, Compliance with Legal Requirements,............... . ..................... 8 6. Title to Replacement Property Site................. ............................................... . .. ............. 8 6.1 Title to Replacement Parking Site......................................... . . .......................... 8 62 Title Insurance ... ..................... ...... ........................................ . ........................ . 8 63 Title Review . ....................................................................................................... . 8 63 1 Developer's Notice ........ .................................. .................... . ............... 9 63.2 City's Notice . . ............ ............................ .............................. ............ . 9 6.3.3 Developer's Election. ............................................... .................... . .... 9 6.3.4 Survey... ... .. .. ... . . .......... ............................................................. 1 9 6.3.5 Approval of Title to Property.................................................................... 9 6.4 Title to Property. ..... . . .............. ..... . . ............. ........ . . ...................... . ........... 10 7 Title to Public Parking Easement. . ................ ......... ........ ... .... . . . . ..... . .. ....... . . ..... 10 7.1 Public Parking Easement.................................... ........................ . . .................... 10 -F PMRSORM8 09/14/05 7.2 Title Insurance ...................................................................................................... 10 7.3 Initial Title Review......................................................................... ..... ............... 10 73.1 City's Notice ............................ ............................................................. 11 73.2 Developer's Notice ........... ........................... ........................ ..... .......... 11 73.3 City's Election .... ..... ................................. ..... ................................ 11 i7.4 New Exceptions to Title, City Approval ........... ............. .................................... I 1 ■ 7.5 Updated Title Commitment............. ................................................ ..... ....... ..... 12 8. Inspection and Evaluation of the Property; "AS IS Sale"................................................ 12 8.1 Due Diligence Period.................................... .................................... ..... ....... .... 12 1 8.2 Property Investigation....... ....... ... . . ................................................................... 12 8.3 Environmental Condition of the Replacement Parking Site................................. 13 8.4 "AS IS SALE.. . . . ..... ............. . . . ... . . .. . ... .. ........................... ....... ... 14 8.5 Waiver of Due Diligence Period for Property...................................................... 14 9. Operation of Replacement Parking Site Pending Closing................................................ 14 10. Conditions Precedent to Closing....................................................................................... 15 10.1 Representations and Warranties..... . ............... . ....... ...................................... ... 15 10.2 Performance .. . . .............. . . ..... .......................................................... ....... ..... 15 10.3 Simultaneous Contribution of SPI Land .................................. ... .................. 15 10.4 Vacation of Alley; Completion of Boundary Line Adjustment Process............... 15 10.5 Simultaneous Exchange of Harrison Property .. . . . .. .............. . ............ . .. 16 10.6 Application for Parking Garage Building Permits and Downtown Design Review ......... ...... . ......... . ...... ..... ........ ........ . ... . . . .................. 16 10.7 Availability of Construction and Equity Financing for Springboard.................. . 16 108 Title Policies ..... . . . . . . . . . ... . . . .. . ... . .. ......................................... ..... . 16 10.9 No Bankruptcy......... ........... ................................................................................ 16 10.10 Condition of Property .......................................................................................... 16 10 11 City's Right to Terminate..................................................................................... 17 11. City Representations........................................... ............................................................. 17 11.1 Authority. .................................................................... ........................................ 17 11.2 No Litigation................................................................................................... . ... 17 11.3 No Condemnation.......................... ...................................................... . ....... ..... 17 11.4 Construction Liens............. . . .............................................................. ............... 17 11.5 Survival ....... . . .................................................................... ....... . ..................... 17 12. Developer's Representations .................. . ..... . . ....... ......... . ......................................... 18 121 Authority ...... . ... ....... ... ..... . . ....... ....... . ...... .. ........................... . ....... . .... 18 12.2 All Consents Obtained ..... . .. . ........ ... . ... ............ ....... ......... . ................. 18 123 Availability of Construction and Equity Financing for Project Springboard. . ... 18 12.4 No Litigation.................................................. .............................................. ....... 19 12.5 No Land Speculation........................................................................... ......... ..... . 19 12.6 Survival. . . . .. . . ... ..... ....... . ....... .................................................................... 20 -11- P QRSORSM 09/14105 13. Closing and Escrow......................................................................................................... 20 13.1 Time and Place of Closing . . ... .......................... ...................... ....................... . 20 13.2 Documents to be Delivered by City ......................................................... ........... 20 13.3 Delivery by Developer. . .... . ................................................ ........................ ... 21 13.4 Other Instruments........... ........................................................... ....... ................ . 21 13.5 Prorations .. ... .................... ............................................................................. 21 13.6 Payment of Costs . ................................................................................ .............. 21 13.7 Closing of Contribution of the Private Land ................................................... . . 22 13.8 Closing Simultaneous with Other Transactions Contemplated under PoolingAgreement............................................................. ........ ........................22 13.9 Recordation . ... .................................................................................... . ..... . ... 22 14. Possession......................................................................................................................... 23 15. Construction of Parking Garage............. ........................................................... .............. 23 15.1 Construction of Parking Garage; Construction Phasing..... . .................... ....... . 23 15.2 Commencement and Completion of Construction.... ................... ..................... . 23 15.3 Unavoidable Delay, Outside Completion Date..................................................... 24 15.4 Hiring Program. .... .... ...... ... . ..... . .... ............... . ............................................ 24 15.5 Construction Staging, Remaining Building Demolition; Temporary Parking Area ...... ........ ... ....... . ... . ........ .. . . . .. . . 15.6 Project Manager; Construction Progress Reports................................................. 24 15.7 Changes to Parking Garage Construction Documents .... . ................................. 25 15 7 1 No Reduction in Parking Garage Capacity or Other Characteristics.................... . ............................. . . ...................... ....... 25 15.7.2 Changes to Construction Documents. . .................. . ....... ..................... 25 15.8 Disclaimer. City Not Liable for Construction of Project Springboard Improvements or Parking Garage........... ... . ..... . ... . .. . .. ...... . . . ............... . 25 15.9 Payment of Parking Garage Costs, Construction Liens............... ........................ 26 15.10 Assignment of Contracts............... . . . ................................................................. 26 16. Developer Financing......................................................................................................... 27 17. Indemnification. . . ............................ .............................................................................. 27 17.1 Developer's Indemnification ................................................................................ 27 17.2 Notice of Claim. ................................................................................................... 28 18. Insurance.......................................................... ...................................... ......................... 28 19. Completion of Parking Garage.................... ................. . . ..............................................29 19.1 Substantial Completion................................................ ........................................ 29 19.1.t Architect's Certification.... ......... . ...................... .................................. 29 19 1.2 Project Substantially Completed. . .. ................... . ................................ 29 19.1.3 Temporary Certificate of Occupancy..................... .......................... ..... 29 19.1.4 Owner Acceptance . ...................... .......................... ........................ 29 19.1 5 Completion of Punch List Items............................................................. 29 19.2 Final Completion of the Parking Garage................................................. ............ 29 -Ili- PTRSWRMB 09114MS 19 2.1 Certificate of Occupancy.................... ................................................... 29 192.2 Contractors' Certification....................................................................... 29 19.23 Punch List Items Completed.................................... ........................ ..... 30 19.24 Construction Costs Paid............................. . ........................................ . 30 1925 No Construction Liens. ..... .................................................................... 30 192.6 Private Street Completed . .......................................... ......................... 30 192.7 Garage Operational................................................................................ 30 20. Acceptance of Public Parking Easement; Release of City Mortgage.............................. 30 20.1 Conditions Precedent to City's Obligation to Accept Public Parking Easement.............................................................. .............................................. . 30 20.1.1 Representations and Warranties...................................................... ....... 31 20.1.2 Performance . . . .. . . ... .. . .......................... .......... ....... . ............... 31 20 1.3 Approval of Condominium Documentation............... ........................... 31 20.1.4 Title Policy........................................................ . ............................ ...... 31 20.1 5 No Bankruptcy.... . . . .. ...... ................................................ . ......... 31 20 1 6 Additional Construction Agreements ................................................... . 31 20.1.7 No Casualty of Condemnation......................................................... ...... 32 20.1.8 Project Springboard Improvement Building Permits........... .......... ....... 32 20.1.9 Simultaneous Closing of Construction Financing for Remainder of Project Springboard Improvements.................................................... 32 20.1.10 City Right to Terminate.......................................................................... 32 202 Documents to be Delivered by Developer............................................................ 32 20.3 Documents to be Delivered by City.. . . . .................................................... ........ 33 204 Other Instruments........ ......... . ............................................................................ 33 20.5 Prorations; Payment of Costs. . —...................................... ................................. 33 20.6 Recordation ..... . .......... . ......... ...................... ......... ........... . ....... .................... 33 21. Damage, Destruction or Condemnation Prior to Closing ................................................ 34 22. Damage, Destruction or Condemnation After Closing, but Prior to Final Completion of the Parking Garage . ............ ....... . . .... . . . ..... . . . ..... . ..................... 34 22.1 Damage or Destruction......................... .............................................................. 34 22.2 Condemnation . ... . ....................... ............................................................ . 34 23. Restrictions on Transfers ....................................................................... . ......... . .......... 35 23 1 No Transfer of Rights under Agreement......... . . ..................... .......................... 35 23.2 Restrictions on Transfer of Interests 1n Developer . .......................................... . 35 23.3 Definition of Transfer ........................... .................................................... ......... 35 23.4 No Transfer of Replacement Parking Site During Construction of Parking Garage. . . . . . . . . ......... .. . . .. . . . . . ....... 35 24. Events of Default Prior to Closing Date; Remedies....... ......... ....................................... 36 24.1 City's Default . . . . . ....... ............. . ............................................................... 36 24.2 Developer's Default ...................... . ................................................................ 36 -Iv- P1DRS1DRS2UB 0911VOS 25. Developer Events of Default Following Closing Date; Remedies. ................................. 36 25.1 Developer Default............. ... . . .................. ..................................................... 36 25.2 City Remedies upon Developer Event of Default .............................. ................. 37 26. City Events of Default Following Closing Date, Remedies............ ................................ 37 27. Rights and Remedies Cumulative . ........................ . ..... ..... ........................................... 38 28. Notices...................... ................................................ ...................................................... 38 29. Survival of Representations and Warranties.................................................................. . 39 30. Brokerage Fees ........................ ..................................... ................... . . ...... . ............... 39 31. Miscellaneous ............................................................ . ................ 40 ........ . .......... ........... . 31.1 Burden and Benefit .............................................................................. ......... . . . 40 31.2 No Continuing Waiver................ . ....... . ........... ............ . . ........ .... .......... . 40 31.3 Nondiscrimination............................................................................................. . 40 31.4 Neutral Authorship .......... .................................................................................... 40 31.5 Terminology . .. ......................................................................... .................. 40 31.6 Complete Agreement, Amendment ....................... ............ ............................ . 40 31.7 Severabiltty .. . . ............................ ............. ..................................................... 40 31.8 Relationship of Parties.................................... .................................................... 40 31.9 No Third Party Rights .............................................. .. ....................................... 41 31.10 Non Waiver of Governmental Rights...................................................................41 31.11 Captions. ........ .................. . ........................................................................... . 41 31.12 Counterparts............................................................. . .......................................... 41 3113 Further Assurance............................ . ......................... .... ................................... 41 31.14 Authority........ . . ................................................................................................. 41 31.15 Time Is of the Essence.. ....... .............. ............................................................. 41 31.16 Memorandum of Agreement......................................... ................................... . . 41 31.17 Attorneys' Fees........................................... . . ........................ ... ........................ 42 31 18 Waiver of Jury Trial........... ..... . ................ . ....................................................... 42 31 19 Exhibits . . . . .. ................... . . . .................. ........... ...........................................42 31.20 Conflicts of Interests.. ................. ... .................. ................................ ............... 42 31 21 Non-Liability of City Officials Employees, and Agents ...................................... 42 31.22 Applicable Law.... . . .. ............. . . . .......... ................. . .................................. . 42 Exhibits ' Exhibit A-1 Legal Description for City-Owned Town Square Plaza Site Exhibit A-2 Legal Description for City-Owned Replacement Parking Site Exhibit A-3 Legal Description for Harrison Exchange Property Exhibit B Legal Description for Private Land Exhibit B-1 Legal Description for Harrison Property Exhibit B-2 Legal Description for SPI Land(following completion of boundary line adjustment and alley vacation) -v- P ORSORMB 09/14/05 Exhibit C-1 Legal Description for Property (SPI Land plus City-Owned Replacement Parking Site) Exhibit C-2 Legal Description for Harrison Exchange Property Exhibit D Preliminary Site Plan for Project Springboard Improvements Exhibit E Parking Garage Design Standards Exhibit F Public Parking Easement Exhibit G City Mortgage Exhibit H Bargain and Sale Deed Replacement Parking Site Exhibit I Definitions � r -vl- P ORSORMB 09/14/05 REPLACEMENT PARKING AGREEMENT THIS REPLACEMENT PARKING AGREEMENT (the "Agreement") is dated as of the 30`h day of September, 2005 by and among CITY OF KENT, a Washington municipal corporation ("City"), SPRINGBOARD HOLDINGS, L L C., a Washington limited liability company ("Developer"), and Second Avenue Real Estate LLC, a Washington limited liability company ("Second Avenue") with reference to the following facts- RECITALS A. City is the owner of certain real property more particularly described in Exhibit A-1, Exhibit A-2 and Exhibit A-3 attached hereto and by this reference incorporated herein (collectively, the "City Property"). The real property legally described on Exhibit A-1 is hereinafter referred to as the "Town Square Plaza Site" The real property legally described on Exhibit A-2 is hereinafter referred to as the "Replacement Parking Site" The real property legally described on Exhibit A-3 is hereinafter referred to as the "Harrison Exchange Property". B. City, MBA Harrison Square I LLC, a Washington limited liability company and MBA Harrison Square 11 LLC, a Washington limited liability company (collectively, "Harrison"), Meeker Street Law Building LLC, a Washington limited liability company ("Meeker Street") and Springboard Properties Investment LLC, a Washington limited liability company ("SPI") are the owners of certain real property located in the City of Kent bordered on the north by Smith Street, on the west by Fourth Avenue, on the South by Harrison Street and on the east by Second Avenue and more particularly described on Exhibit B attached hereto and by this reference incorporated herein (collectively, the "Private Land"). Harrison and Meeker Street are hereinafter referred to collectively as "Anderson'. The real property owned by Harrison described in Exhibit B-I is hereinafter referred to as the "Harrison Property" Anderson and SPI are hereinafter referred to collectively as "Private Owners" C Pursuant to the Pooling Agreement dated September 30, 2005 by and among City, Private Owners and Developer ("Pooling Agreement"), the parties to the Pooling Agreement have each agreed to participate in the boundary line adjustment and alley vacation described therein; provided, however, Anderson will not participate in any joint development of the Property (defined below). Anderson will exchange the Harrison Property for the Harrison Exchange Property as described in the Pooling Agreement and will continue to own the same quantity of land following such exchange in a different configuration(hereinafter, the "Anderson Property") subject to the restrictive covenant described in the Pooling Agreement. The property described on Exhibit B-2 that will be owned by SPI following the boundary line adjustment is hereinafter referred to as the "SPI Land" The SPI Land and the Replacement Parking Site are more particularly described on Exhibit C-I attached hereto and by this reference incorporated , herein and are hereinafter referred to collectively as the"Property" or the "Project Site" D City is interested in redeveloping the Town Square Plaza Site with an approximately 34,000 square foot town square plaza and Developer is interested in acquiring the Project Site for redevelopment with a privately owned mixed-use development, including an i above grade parking garage with a minimum of three hundred fifty (350) parking stalls, each as more particularly described below E. Developer desires to acquire the Replacement Parking Site from City in exchange for a perpetual parking easement in favor of City in the parking garage to be constructed by Developer on the Property that will provide public parking at all times for not less than seventy (70) multi-passenger motor vehicles at all times, and in addition, grant members of the public the right to park in any open parking stall in the parking garage on a first-come, first serve basis, at all times, in each case, at no initial cost to either City or members of the general public on the terms and conditions hereinafter set forth. City has determined that the substantial private investment proposed for the Property will improve the financial stability and general economic vitality of City The proposed redevelopment will provide additional housing downtown in close proximity to the Kent commuter rail and bus transit center, increase pedestrian activity downtown, create additional jobs, and will expand and diversity the City's tax base. The provision of safe, convenient, accessible and attractive public parking in the downtown retail core will increase retail activity, indirectly improve public safety, prevent traffic congestion and improve vehicular access and circulation within the City and is a traditional and well-recognized public purpose. NOW, THEREFORE, in consideration of the mutual covenants and conditions contained herein, the grant of a perpetual easement for public parking in favor of City and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, City and Developer agree as follows AGREEMENT 1. Incorporation of Recitals, Definitions Each recital set forth above is incorporated into this Agreement as though fully set forth herein. All capitalized terms not otherwise defined herein shall have the meaning set forth in Exhibit J to this Agreement 2. Protect Springboard Development Project. 2.1 Project Elements Developer intends to acquire the Property from City and SPI and redevelop the Property with a privately owned mixed-use condominium development (hereinafter referred to as "Project Springboard") Project Springboard shall consisting of condominium units created pursuant to a master declaration and survey map and plans prepared by Developer and approved by City, which approval shall not be unreasonably withheld, conditioned or delayed, developed with the following uses- (a) an approximately 74-room hotel, including reception area, lobby, a conference center of approximately 1,600 square feet, a spa of approximately 1,000 square feet and an indoor water park of approximately 7,000 square feet (collectively, the "Hotel Improvements"), (b) approximately 64 units of market rate residential condominiums, (c) approximately 23,000 square feet of restaurant and retail space, (d) on-site parking for approximately four hundred (400) multi-passenger motor vehicles to be located within the parking garage more particularly described in Subsection 2 3 below, including access to and from the public streets adjoining the Property; (e) approximately 56 units of market rate condominiums for seniors, and (f) common elements and limited common elements as are set forth in the master condominium declaration and survey map and -2- P ORSORS2US 09/14/05 plans, including, but not limited to, a private street connecting Smith and Harrison Streets, elevated skybridge, elevators, stairs and walkways providing for pedestrian access to and from the vanous Project Springboard Improvements, including, but not limited to, the Parking Garage, together with easements for vehicular and pedestrian access to and from the Parking Garage, utilities, and such other easements as may be necessary or customary given the nature of the development (collectively, the "Project Springboard Improvements") Each condominium may contain such number of separate condominium units as Developer shall determine in the reasonable exercise of its business judgment pursuant to one of more condominium declarations and survey map and plans prepared by Developer A preliminary site plan for the Project Springboard Improvements is attached hereto as Exhibit D and by this reference incorporated herein. 2.2 General Parking Requirements Developer shall provide sufficient parking stalls on the Property (excluding parking located on public streets adjoining the Property) to meet a minimum parking ratio of 1.0 stalls per bedroom for any residential unit, and 2.0 stalls per 1,000 rentable square feet for any portion of the Property developed for office, commercial or retail use by constructing an above-ground structured parking garage containing a minimum of three hundred fifty (350) parking spaces for multi-passenger motor vehicles (the "Parking Garage") For purpose of the foregoing parking ratios, the Hotel improvements shall be considered a residential use and not a commercial use. In addition, Developer shall provide an additional seventy (70) parking stalls for exclusive public parking The Parking Garage shall be designed and operated so that all parking spaces are available for use by members of the general public on a first come, first serve basis, twenty-four (24) hours a day, seven (7) days a week No parking fees shall initially be assessed to members of the general public to park in the Parking Garage. No parking stalls will be allocated to a particular condominium unit, hotel guest, commercial tenant or any of their invitees or customers; provided, however, that the owner of the Parking Garage shall have the right to issue a limited number of special use parking permits as set forth in the Public Parking Easement. The Parking Garage shall be operated as a self-park, public parking garage and shall be managed to maximize the availability of Short Term Parking(as defined in the Public Parking Easement) at all times 2.3 Parking Garage, Minimum Design Criteria The Parking Garage shall consist of four (4) levels of above-grade parking containing a minimum of three hundred fifty (350) parking spaces for multi-passenger motor vehicles. Elevators, stairs and pedestrian walkways providing access to the Parking Garage shall be clearly marked or structurally integrated at the ground level so that members of the public, hotel guests, condominium owners and retail tenants and their customers and invitees may easily access the Parking Garage from adjoining public streets or other parts of the Project Springboard Improvements. There shall be at least one entrance and exit to the Parking Garage providing for vehicular ingress and egress to the public streets adjoining the Property utilizing the private street. The Parking Garage shall be designed to high standards for vehicular access and circulation, lighting, safety, ease of maintenance, energy efficiency and attractiveness, including one or more entry and exit plazas and shall conform to the additional design standards set forth on Exhibit E attached hereto and by this reference incorporated herein. The Parking Garage shall be built in compliance with all applicable building codes and other applicable laws, rules and regulations, including, but not limited to, the applicable provisions of Title III of the Americans with Disabilities Act and -3- P16RSORS2US 09/14105 regulations issued thereunder concerning accessibility of places of public accommodation and commercial facilities. 3. Acquisition of Property. 3.t Contribution of SPI Land Developer represents to City that it has entered into a binding contract with SPI (the "SPI Contribution Agreement") whereby SPI has agreed to contribute the SPI Land (following the SPI exchange with the City) to Developer. The SPI Contribution Agreement contains, at a minimum, the following terms and conditions- (i) feasibility period not to exceed forty-five (45) days with closing on or before December 15, 2005, (n) the SPI Contribution Agreement for the SPI Land shall provide for a simultaneous closing and shall be expressly conditioned on the contribution or exchange of the remainder of the Property pursuant to the Pooling Agreement, including, but not limited to, the Replacement Parking Site, and (ui) construction of the Parking Garage must commence on or before JMarch 31, 2006 3.2 Exchange of Harrison Property. Pursuant to Paragraph 9 of the Pooling Agreement, Harrison has agreed to exchange the Harrison Property for the Harrison Exchange Property. 3.3 Disposition of Replacement Parking Site, Public Parking Easement. Subject to all the terms, covenants, conditions and provisions of this Agreement, City agrees to transfer the Replacement Parking Site to Developer upon the express condition that Developer design, develop and complete construction of the Parking Garage on the Replacement Parking Site and grant City the Public Parking Easement upon Final Completion of the Parking Garage and satisfaction of the conditions precedent to acceptance of the Public Parking Easement set forth in Sections 19 and 20 of this Agreement. 3.4 Description of Public Parking Easement. The public parking easement shall grant City, any successor public entity and members of the general public, a perpetual easement to park in the Parking Garage to be constructed by Developer as part of Project Springboard, twenty four (24) hours a day, seven (7) days a week, initially at no charge, together with rights of pedestrian and vehicular access to and from the Parking Garage and the public streets adjoining the Property, including ingress and egress by means of the private street. All parking stalls in the Parking Garage are intended to be used for Short-Term Parking by Springboard Project condominium owners, hotel guests, tenants of Project Springboard Improvements, tenants of real property owned by Second Avenue south of Harrison Street and their respective customers and members of the general public on an unreserved first-come. first- serve basis, provided, however, that the owner of the Parking Garage may issue a limited number of special use permits on the terms and conditions set forth in the Public Parking Easement Not less than seventy (70) parking spaces in the Parking Garage shall be available to members of the general public for Short Term Parking at all times (the "Exclusive Public Parking Stalls"). to addition to the Exclusive Public Parking Stalls which shalt be reserved for public parking at all times, members of the general public shall have the right to park in any open parking stall in the Parking Garage on a first-come, first-serve basis twenty-four (24) hours a day, seven (7) days a week. Short Term Parking shall be determined by the City from time to time to maximize utilization of parking stalls in the Parking Garage by members of the general public and hotel -4- P VDRS%DR82UB M14105 guests, condominium owners, Project Springboard and Second Avenue tenants and their customers while limiting use of the Parking Garage by commuters and tenants of adjoining properties. The public parking easement shall be in substantially the form annexed hereto as Exhibit F and by this reference incorporated herein("Public Parking Easement"). 4. Fair Value Determination of Replacement Parking Site, Public Parking Easement. 41 Fair Value Determination of Exchange Properties. City and Developer agree that City would not agree to transfer the Replacement Parking Site to Developer in exchange for the Public Parking Easement, but for Developer's agreement to- (a) complete construction of the Parking Garage on the Property as part of the Project Springboard Improvements, at its sole cost and expense, pursuant to the provisions of Sections 5 and 15 of this Agreement within nine (9) months following Closing, (b) complete construction of the Parking Garage with a minimum capacity of three hundred fifty (350) parking spaces for multi- passenger motor vehicles, which is sixty-five (65) parking stalls more than the number of parking stalls that Developer would be required to construct in order to build the Project Springboard Improvements on the Property to satisfy the Project parking ratios set forth in Section 2.2 of this Agreement; (c) manage the Parking Garage so that the seventy (70) Exclusive Public Parking Stalls are reserved for public parking at all times and in addition, members of the general public shall have the right to park in any open parking stall in the Parking Garage on a first-come, first-serve basis at all times, (d) operate the Parking Garage as a self-park, public parking garage open to members of the public twenty-four (24) hours a day, seven (7) days a week, initially without charge, and in a manner which maximizes the availability of Short Term Parking at all times; (e) operate and maintain the Parking Garage at Developer's sole cost and expense in first-class order, condition and repair in accordance with standards prevailing in first class mixed-use developments including multilevel structured parking garages and the multilevel structured parking garage owned, operated and maintained by The Central Puget Sound Regional Transit Authority in connection with its Kent commuter rail station, and (f) grant City, any successor public entity and members of the general public, the Public Parking Easement. 4.2 Security; CitV Mortgage; First Lien on Property The obligations of Developer under this Agreement shall be secured by a deed of trust in the form attached hereto as Exhibit G and by this reference incorporated herein (the "City Mortgage") which shall constitute a first lien on the Project Site Developer shall also assign to City the architect's agreement and construction contracts for the Parking Garage as additional security for the performance of Developer's obligations under this Agreement, which assignments shall be in form and substance satisfactory to Developer and City and shall be consented to by the architect and contractors,respectively 4.3 Terms of City Mortgage City shall have the right to foreclose the City Mortgage upon the occurrence of certain Events of Default by Developer under this Agreement as defined in Section 25 of this Agreement. As a condition to Closing, Developer's equity investors and lenders shall approve the form of the Public Parking Easement and pursuant to agreements in form and substance satisfactory to City, agree to consent to and subordinate the lien of any financing to the Public Parking Easement upon Final Completion of the Parking Garage and recordation of the Public Parking Easement in the real property records of King County, Washington. ' -5- P\DRS\DRS2UB OWMOS 44 Acceptance of Public Parking Easement Upon Final Completion of Parking Garage; Satisfaction of City Mortgage Provided there is no Event of Default by Developer under this Agreement and no event that with the giving of notice, the passage of time or both, would constitute an Event of Default by Developer under this Agreement, if (a) Final Completion of the Parking Garage has occurred on or before the Outside Completion Date, and (b) each of the conditions set forth in Sections 19 and 20 of this Agreement have been met to the reasonable satisfaction of City, City will agree to accept title to the Public Parking Easement in full and complete satisfaction of the obligations of Developer to design, develop and complete construction of the Parking Garage pursuant to this Agreement and will record the Public Parking Easement in the real property records of King County, Washington and release the City Mortgage of record. 4.5 Escrow Agent. LandAmerica Title Insurance Company in its capacity as escrow agent ("Escrow Agent") and in its capacity as title insurer ("Title Company") has been designated as Escrow Agent and Title Company by mutual agreement of City and Developer. 5. Design Development of Project Springboard Improvements and the Parking Garage. 5 1 Construction of Project Springboard Improvements and Parking Garage. City would not have entered into this Agreement and agreed to transfer the Replacement Parking Site in exchange for the Public Parking Easement, but for the agreement by Developer to cause the construction of the Project Springboard Improvements on the Property and to cause the construction of the Parking Garage in accordance with the terms and conditions hereinafter set forth As of the date of this Agreement, City has reviewed and approved the basic project elements and uses proposed for the Project Springboard Improvements to be constructed on the Property, including the preliminary site plan attached hereto as Exhibit D, the minimum design standards for the Parking Garage attached hereto as Exhibit E Prior to December 1, 2005, City shall have reviewed and approved the Schematic Design Documents and Detailed Specifications for the Parking Garage (the "Parking Garage Schematic Design Documents") 5.2 Construction Drawings and Detailed Specifications for Parking Garage. Following approval of the Parking Garage Schematic Design Documents, Developer shall, at its sole cost and expense, cause its architects to prepare construction drawings for the Parking Garage in a form sufficient to apply for a building permit for the Parking Garage ("Construction Drawings"), which Construction Drawings shall be prepared in accordance with the requirements of this Agreement and the Parking Garage Schematic Design Documents in all material respects and shall deliver a copy of same to City for its review and approval. Any change from the Parking Garage Schematic Design Documents shall be clearly highlighted to indicate the changes. City shall promptly review the Construction Drawings and shall give Developer 1 written notice within fifteen (15) days following its receipt of the Construction Drawings, of its approval or disapproval of the Construction Drawings, specifying in the case of its disapproval, its reasons therefore City shall have the right to disapprove Construction Drawings which (1) do not comply with all Requirements of Law, (n) do not comply with the Parking Garage Schematic Design Documents in all material respects, (in) materially change the configuration or layout of the parking stalls from the preliminary site plan attached hereto as Exhibit D or the minimum design standards attached hereto as Exhibit E, or (iv) reduce the capacity of the Parking Garage -6- P ORSORS2UB 09/14/05 below three hundred fifty (350) parking stalls. If City has not responded to the Construction Drawings within fifteen (15) days after City's receipt thereof, or of any resubmittals thereof, the Construction Drawings shall be deemed approved. Nothing contained herein shall constitute a waiver of City's rights as the jurisdiction with permitting authority over the Project Springboard Improvements including, but not limited to, the Parking Garage, to review Developer's application for building and other permits, compliance with the City's Downtown Design Review process, or the City's right to impose conditions prior to issuance of permits necessary to construct the Project Springboard Improvements and the Parking Garage in accordance with all Requirements of Law. 5 3 Resubmittals. If objections or comments are submitted in writing by City within the timeframe set forth in the preceding subsection, Developer shall cause its architects to make changes in the Construction Drawings consistent with objections or comments made by City pursuant to the preceding subsection and shall resubmit the same in accordance with the foregoing schedule for further review The process of resubmittal and review shall continue until the submittals have been approved by all parties. The final Construction Drawings and Detailed Specifications setting forth in detail the requirements for the construction of the Parking Garage once they have been approved by City are called the "Parking Garage Construction Documents". There shall be no changes in the Parking Garage Construction Documents without the prior written consent of City as hereinafter provided. 5.4 Design Development for Remainder of Project Springboard Improvements. City acknowledges that the Parking Garage has been designed as an integrated part of a mixed-use commercial development containing a number of different buildings. The remainder of the Project Springboard Improvements more particularly described in Section 2.1 of this Agreement will be constructed on the Property in accordance with the preliminary site plan attached hereto as Exhibit D. Developer reserves the right to make changes, modifications, additions and deletions to the plans and specifications for the Project Springboard Improvements (other than the improvements to be built by Developer pursuant to Section 20.1 6 below and the Parking Garage, unless such change would increase the number of available parking spaces in the Parking Garage subject to the Public Parking Easement) so long as Developer does not change the basic program elements or make any material change in the type of uses proposed as part of the Project Springboard Improvements without the prior written consent of City. 5 5 Construction in Phases Developer has agreed to construct Project Springboard in phases. The Parking Garage shall be constructed first as part of Phase One. City shall not be obligated to issue building permits for the remainder of Project Springboard until after Final Completion of the Parking Garage and acceptance of the Public Parking Easement pursuant to Sections 19 and 20 of this Agreement. 5.6 Permits; Costs, Compliance with Legal Requirements. Developer shall obtain all permits and authorizations from any federal, state or local government or departments or subdivisions thereof having jurisdiction over the Property in order to permit construction of the Parking Garage in substantial accordance with the Parking Garage Construction Documents and all Requirements of Law. Nothing contained in this Agreement is intended or shall be construed to require that City exercise its discretionary authority under its regulatory ordinances to further Project Springboard or the Parking Garage nor binds City to do so City will process -/- P MRSURMB 09/14/05 applications for permits and approvals as if such applications were made without any City agreement to accept the Public Parking Easement to park in the Parking Garage upon satisfaction of the conditions set forth in Sections 19 and 20 of this Agreement. 6. Title to Replacement Property Site 6.1 Title to Replacement Parking Site. City shall execute and deliver to Developer at Closing a bargain and sale deed in the form attached hereto as Exhibit I and by this reference incorporated herein ("Deed") conveying fee simple title to the Replacement Parking Site subject to Permitted Exceptions as determined in accordance with Sections 6.2 and 6.3 below. [ 6.2 Title Insurance On the Closing Date, City shall cause the Title Company to issue Developer an Extended Coverage Owner's Policy of Title Insurance (the "Developer's Title Policy"), with liability in the amount of Nine Hundred Ninety-One Thousand and Five Hundred Fifty Dollars ($991,550) insuring good and marketable fee title to the Replacement Parking Site in Developer against any loss or damage by reason of defects in City's title to the Replacement Parking Site, other than Permitted Exceptions Developer may, at its sole cost and expense, request endorsements to Developer's Title Policy, but the availability of such endorsements shall not be a condition precedent to closing. 6.3 Title Review The Title Company shall provide City and Developer with a preliminary commitment for title insurance for the Replacement Parking Site ("Title Commitment") within ten (10) days following execution of this Agreement, together with complete copies of any exceptions identified in Schedule B thereof. Developer shall conduct its review of the Title Commitment in accordance with the following procedures: 6.3.1 Developer's Notice. Developer shall have fifteen (15) days from the date of receipt of the Title Commitment to notify City of its approval or disapproval of each exception in Schedule B of the Title Commitment. Failure to deliver such notice by that date shall constitute Developer's approval of all exceptions in Schedule B All monetary liens and encumbrances arising through City's actions other than non delinquent ad valorem property taxes, special assessments and local improvement district assessments will be deemed disapproved and City shall cause all such monetary liens and encumbrances to be fully satisfied, released and discharged of record on or prior to the Closing Date without the necessity of Developer's objection Developer shall not be entitled to disapprove the general exceptions or any exceptions created by or on the account of Developer or exceptions recorded in connection with the proposed redevelopment of the Property with Project Spnngboard. Covenants, conditions, restrictions, reservations and easements presently of record which are not inconsistent with the redevelopment of the Property with Project Springboard, or proposed Public Parking Easement in favor of City and members of the general public, the City Mortgage, and non-delinquent real estate taxes, special assessments and local improvement district assessments now or hereafter levied against the Replacement Parking Site shall be deemed Permitted Exceptions and shall not be objected to by Developer. Exceptions deemed approved pursuant to this Section 6 3 1 or not disapproved by Developer within the time period set forth above shall be "Permitted Exceptions" -8- P1ORMRS2UB 09/14/05 6 3.2 City's Notice. City shall have five (5) days after receipt of Developer's title review letter in which to notify Developer whether or not it elects to cure or remove any of the disapproved exceptions of which City received timely notice pursuant to Section 6 3.1 above. City's failure to so notify Developer shall constitute City's election to not remove all such exceptions City shall remove all exceptions it elects to remove on or before the Closing Date 6.3.3 Developer's Election. If City does not elect to remove all exceptions disapproved by Developer, Developer may elect to terminate this Agreement by written notice to City given within five (5) days following City's notice in which event this Agreement shall automatically terminate and except as otherwise expressly provided herein, neither party hereto shall have any further rights, duties or obligations under this Agreement. If Developer does not elect to terminate this Agreement within the time frame set forth herein, disapproved exceptions that City has not elected to remove shall become Permitted Exceptions for the Replacement Parking Site. 6.3.4 Survey. Developer shall obtain a current ALTA/ASCM survey of the Replacement Parking Site prepared by a licensed or registered surveyor, which survey shall be satisfactory to Developer and the Title Company 6.3.5 Approval of Title to Property. Prior to expiration of the Due Diligence Period set forth in Section 8 of this Agreement, Developer shall notify City, Anderson and SPI that it has either: (a) approved the condition of title to all of the parcels constituting the Property and the Harrison Property to be exchanged for the Harrison Exchange Property, or (b) not approved the condition of title to all of the parcels constituting the Property and the Harrison Property to be exchanged for the Harrison Exchange Property. In the event Developer has not approved the condition of title to all such parcels on or prior to expiration of the Due Diligence Period, either party may thereafter terminate this Agreement without liability to the other party upon thirty (30) days written notice, and thereafter, except as otherwise expressly provided herein, neither party shall have any further rights, duties or obligations under this Agreement. 6.4 Title to Property. The Title Company shall also provide City and Developer with a preliminary commitment for title insurance for the entire Property within ten (10) days following execution of this Agreement, together with complete copies of any exceptions identified in Schedule B thereof City and Developer shall conduct their review and approval of the title commitment for the Property utilizing the same procedure and within the same time period set forth above for Developer's review and approval of title to the Replacement Parking Site and the title exceptions which have been approved by City and Developer shall be referred to as the "Property Permitted Exceptions") Once approved by City and Developer, Developer shall not enter into or consent to any Intervening Lien (as defined in Section 7.4) with respect to the Property without the prior written consent of City or which would impair the first hen priority of the City Mortgage Notwithstanding any provision of this Agreement to the contrary, Developer shall cause any mortgage, deed of trust or other encumbrances to be fully satisfied, released and discharged of record on or prior to the Closing Date without the necessity of City's objections. The Title Company shall also issue City an ALTA Extended Coverage Mortgagee's Policy of Title Insurance (the "City Loan Policy") with liability in the amount of -9- PORSORS2UB 09h4M Six Million Five Hundred Ninety-One Thousand and No/100 Dollars ($6,591,000.00) insuring the first lien priority of the City Mortgage on the Property subject only to the Property Permitted Exceptions approved by City and Developer during the title review period. 7. Title to Public Parkin Easement. 7.1 Public Parking Easement. Upon Final Completion of the Parking Garage and satisfaction of the conditions set forth in Sections 19 and 20 of this Agreement, Developer shall execute and deliver to City on the Public Parking Easement Acceptance Date (as defined in Section 20 of this Agreement) the Public Parking Easement, subject only to City's Permitted Exceptions as determined in accordance with Section 7.3 below. 7.2 Title Insurance. On the Public Parking Easement Acceptance Date, Developer shall cause the Title Company to issue City an Extended Coverage Owner's Policy of Title Insurance (the "City's Title Policy"), with liability in the amount of One Million Four Hundred Seventy-Five Thousand Seven Hundred Fifty and No/100 Dollars ($1,475,750.00) insuring that City is the owner of, and benefited party under, the Public Parking Easement, and insuring City against any loss or damage by reason of defects in Developer's title to the Property subject to the Public Parking Easement, other than City Permitted Exceptions (as defined below) 7.3 Initial Title Review The Title Company shall provide City and Developer with a preliminary commitment for title insurance for the property which will be subject to the Public Parking Easement ("City's Title Commitment") within ten (10) days following execution of this Agreement, together with complete copies of any exceptions identified in Schedule B thereof. City shall conduct its review of City's Title Commitment in accordance with the following procedures: 7.3.1 City's Notice. City shall have fifteen (15) days from the date of receipt of City's Title Commitment to notify Developer of its approval or disapproval of each exception in Schedule B of City's Title Commitment. Failure to deliver such notice by that date shall constitute City's approval of all exceptions in Schedule B. All monetary liens and encumbrances other than non delinquent ad valorem property taxes, special assessments and local improvement district assessment will be deemed disapproved and Developer shall cause all such monetary liens and encumbrances to be fully satisfied, released and discharged of record on or prior to the Closing Date without the necessity of City's objection City shall not be entitled to disapprove the general exceptions or any exceptions created by or on the account of City Covenants, conditions, restrictions, reservations and easements presently of record which are not inconsistent with the rights of City and members of the general public under the Public Parking Easement, and non-delinquent real estate taxes, special assessments and local improvement district assessments now or hereafter levied against the Property shall be deemed Permitted Exceptions and shall not be objected to by City Exceptions deemed approved pursuant to this Section 7.3 1 or not disapproved by City within the time period set forth above shall be "City's Permitted Exceptions". Notwithstanding any provision of this Agreement to the contrary, any mortgage or deed of trust which Developer intends to record in connection with financing for Project Springboard shall be expressly subject and subordinate to City's Mortgage and the Public Parking Easement, and upon request by City or the Title Company, Developer shall cause its -to- P\DRSORS2UB OSM4M5 lenders to consent to, and subordinate the lien of any mortgage financing to, City's Mortgage and the Public Parking Easement 7.3 2 Developer's Notice Developer shall have five (5) days after receipt of City's title review letter in which to notify City whether or not it elects to cure or remove any of the disapproved exceptions of which Developer received timely notice pursuant to Section 7.3.1 above. Developer's failure to so notify City shall constitute Developer's election to not remove all such exceptions. Developer shall provide City with reasonable assurances prior to expiration of the Due Diligence Period that it will remove all such exceptions and shall remove all exceptions it elects to remove on or before the Closing Date set forth in Paragraph 13 7.3.3 City's Election. If Developer does not elect to remove all exceptions disapproved by City, City may elect to terminate this Agreement prior to expiration of the Due Diligence Period by written notice to Developer given within five (5) days following Developer's notice in which event this Agreement shall automatically terminate and except as otherwise expressly provided herein, neither party hereto shall have any further rights or obligations under this Agreement. 7.4 New Exceptions to Title, City Approval. Once the City's Permitted Exceptions have been determined, Developer shall not enter into any new agreement, easement, restriction, condition, covenant, right-of-way, lease, license or other matter affecting title or create any lien or encumbrance (collectively, "Intervening Lien") which will affect the Property or the Parking Garage without the prior written consent of City which consent shall not be unreasonably withheld so long as such Intervening Lien will not adverse affect or interfere with the rights of City and members of the public under the Public Parking Easement. 7.5 Updated Title Commitment. Upon Substantial Completion of the Parking Garage, Developer shall cause the Title Company to deliver an update to City's Title Commitment to the City and Developer, together with copies of any exceptions identified in any update that were not set forth in the original City Title Commitment, together with a copy of any declaration and survey map and plans which Developer intends to record against the Property in connection with the Parking Garage (which meets the requirements of Section 20.1.3). City agrees not to unreasonably withhold its consent to any new exceptions to title so long as any such exceptions will not adversely affect or interfere with the rights of City and members of the general public under the Public Parking Easement. City shall advise Developer in writing within fifteen (15) days after receipt of the update to the City's Title Commitment what exceptions to title, if any, in addition to the declaration and survey map and plans and the City's Permitted Exceptions will be accepted by City Developer shall remove all new exceptions objected to by City on or before the Public Parking Easement Acceptance Date. 8. Inspection and Evaluation of the Property, "AS IS Sale". 8.1 Due Diligence Period. Developer shall have until November 15, 2005 in which to conduct its due diligence investigation of the Property including, but not limited to, the Replacement Parking Site, and determine the financial feasibility of Project Springboard ("Due Diligence Period"). Developer's obligations under this Agreement are expressly subject to its approval of the Replacement Parking Site, the suitability of the Replacement Parking Site for -11- P%DRS1DRS2UB 09/14105 Developer's intended development of Project Springboard, title, the environmental condition of the Replacement Parking Site and the financial feasibility of Project Springboard, such approval to be determined by Developer in its sole and absolute discretion and within the time period set forth in this Section 8.1. Developer shall deliver written notice to City and Escrow Agent prior to expiration of the Due Diligence Period that it has either (a) elected to terminate this Agreement whereupon Developer shall, subject to its legal right to do so, deliver to City the originals of all site plans, the Parking Garage Schematic Design Documents and Construction Drawings related to the Parking Garage then in existence for no additional consideration, this Agreement shall terminate and, except as otherwise expressly provided herein, neither party shall have any further rights, duties or obligations under this Agreement, or (b) Developer has elected to proceed with the acquisition of the Replacement Parking Site, in which event Developer shall have agreed to accept the Replacement Parking Site in its "AS IS" condition and state of repair and shall have waived its financial feasibility contingency. 92 Property Investigation. City shall give Developer and its agents and consultants the right to enter upon the Replacement Parking Site or any part thereof after mutual execution of this Agreement after reasonable prior notice and during normal business hours (subject to the rights of members of the public to use the Replacement Parking Site for public parking) for the purposes of determining the physical condition of the Replacement Parking Site and the financial feasibility and the suitability of the Replacement Parking Site for Developer's intended purposes, including without limitation, the right to conduct soil compaction tests, surveys, engineering, traffic and access studies and review of zoning and other matters, at Developer's sole cost and expense. City shall have the right to accompany Developer or its agents or consultants on all such inspections, studies and tests. Developer and its agents and consultants shall comply with City's reasonable safety requirements and shall conduct all inspections, studies and tests at reasonable times agreed upon by City and Developer, and in a manner so as to minimize any interference with the continued use of the Replacement Parking Site by members of the public for public parking purposes. Developer shall repair any damage to the Replacement Parking Site caused by Developer, its employees or agents during such inspections, studies and tests and shall restore the Replacement Parking Site to the condition it was in immediately prior to Developer's activities on the Replacement Parking Site Developer shall protect, defend, indemnify and hold City and the Replacement Parking Site harmless from any claims, liabilities, costs, expenses or liens (including, but not limited to, any claims for personal injury or property damage) arising out of or resulting from its inspection of the Replacement Parking Site. This indemnification and restoration obligation shall survive Closing or any termination of this Agreement If Developer does not approve the condition, feasibility and suitability of the Replacement Parking Site as provided in Section 8 1 above, Developer shall notify City and the Escrow Agent in writing prior to the expiration of the Due Diligence Period. If Developer fails to deliver written notice to City and Escrow Agent prior to the expiration of the Due Diligence Period, Developer shall be deemed to have approved the condition, feasibility and suitability of the Replacement Parking Site for Developer's intended purposes. 8.3 Environmental Condition of the Replacement Parking Site City expressly 1 makes no representation or warranty regarding the environmental condition of the Replacement Parking Site or the presence or absence of hazardous substances thereon Developer shall have the right to retain environmental consultants to determine the environmental condition of the Replacement Parking Site and conduct environmental assessments of the Replacement Parking -12- piDRSORMB D914105 Site during the Due Diligence Period, at its sole cost and expense. Such additional environmental assessments may include, by way of illustration and not by way of limitation, drilling, sampling, soil borings and the installation of monitoring wells or other equipment on the Replacement Parking Site Developer shall repair any damage to the Replacement Parking Site caused by Developer or its environmental consultants during such environmental assessment, including properly closing in place all test wells that will remain on the Replacement Parking Site, and will protect, defend, indemnify and hold City and the Replacement Parking Site harmless from any claims, liabilities, costs, expenses or liens (including, but not limited to, any claims for personal injury or property damage) ansing out of such evaluation or testing. This indemnification and restoration obligation shall survive Closing or any termination of this Agreement. If Developer does not approve the environmental condition of the Replacement Parking Site, Developer shall notify City and Escrow Agent in writing prior to the expiration of the Due Diligence Period If Developer fails to deliver written notice to City and Escrow Agent prior to the expiration of the Due Diligence Period, Developer shall be deemed to have approved the environmental condition of the Replacement Parking Site and to have elected to proceed with its acquisition of the Replacement Parking Site. 8.4 "AS IS SALE" Developer acknowledges and agrees that Developer will be concluding its acquisition of the Replacement Parking Site based upon Developer's inspection and investigation of the Replacement Parking Site and its suitability for Developer's intended purposes. Developer further acknowledges and agrees, that, except as expressly provided in this Agreement, City does not make any representations or warranties of any kind, either express or implied, with respect to the Replacement Parking Site, including, but not limited to, the use or condition of the Replacement Parking Site, compliance with applicable statutes, laws, codes ordinances, regulations, or zoning, subdivision, building, fire, safety, health or environmental matters. THE TRANSFER OF THE REPLACEMENT PARKING SITE IS MADE ON AN "AS IS" CONDITION AND BASIS WITH ALL FAULTS AND CITY HAS NO OBLIGATION TO MAKE REPAIRS, REPLACEMENTS OR IMPROVEMENTS TO THE REPLACEMENT PARKING SITE. IN PARTICULAR, BUT WITHOUT LIMITATION, CITY MAKES NO REPRESENTATIONS OR WARRANTIES WHATSOEVER WITH RESPECT TO THE PHYSICAL CONDITION OR VALUE OF THE REPLACEMENT PARKING SITE, THE PRESENCE OR ABSENCE OF HAZARDOUS SUBSTANCES ON THE REPLACEMENT PARKING SITE, SOILS CONDITIONS, OR OTHER PHYSICAL CHARACTERISTICS OF THE REPLACEMENT PARKING SITE OR THE SUITABILITY OF THE REPLACEMENT PARKING SITE FOR DEVELOPER'S INTENDED DEVELOPMENT. CITY MAKES NO REPRESENTATION WHATSOEVER REGARDING THE FINANCIAL FEASIBILITY OF PROJECT SPRINGBOARD OR THE PARKING GARAGE UPON CLOSING AND RECORDING OF THE DEED TO THE REPLACEMENT PARKING SITE, DEVELOPER DOES HEREBY WAIVE AND RELEASE CITY, ITS OFFICIALS, OFFICERS, EMPLOYEES AND AGENTS FROM ANY AND ALL DAMAGES, LOSSES, LIABILITIES, COSTS AND EXPENSES WHATSOEVER (INCLUDING, WITHOUT LIMITATION, REASONABLE , ATTORNEYS' FEES AND COSTS) AND CLAIMS THEREOF, WHETHER DIRECT OR INDIRECT, KNOWN OR UNKNOWN, FORESEEN OR UNFORESEEN, WHICH MAY ARISE ON ACCOUNT OF OR IN ANY WAY ARISING OUT OF OR 1N CONNECTION WITH THE PHYSICAL OR ENVIRONMENTAL CONDITION OF THE REPLACEMENT PARKING SITE OR THE PRESENCE OF ANY HAZARDOUS SUBSTANCES WHICH -13- PTRUM2U6 09/14/05 MAY EXIST ON THE REPLACEMENT PARKING SITE OR ANY REQUIREMENT OF LAW APPLICABLE THERETO 8.5 Waiver of Due Diligence Period for Property Prior to expiration of the Due Diligence Period set forth in Section 8.1 of this Agreement, Developer shall notify City, Anderson and SPI that it has either. (a) elected to terminate one or more of the contribution or exchange agreements for one or more parcels constituting the Property, in which event this Agreement shall automatically terminate and except as otherwise expressly provided herein, neither party shall have any further rights, duties or obligations under this Agreement or (b) it has elected to proceed with its acquisition of each of the parcels constituting the Property. 9. Operation of Replacement Parking Site PendingClosing.losing. At all times before the closing of the transfer of the Replacement Parking Site, City shall have the right to use the Replacement Parking Site for public parking purposes or as it may otherwise determines in its reasonable discretion; provided, however that (a) City shall not construct any buildings or install any other permanent improvements on the Replacement Parking Site without the prior written consent of Developer which consent shall not be unreasonably withheld, (b) City shall not encumber the Replacement Parking Site with any mortgage or deed of trust that will not be paid off or reconveyed prior to Closing, provided however, that nothing contained herein shall preclude City from consenting to the formation of a local improvement district which would include the Replacement Parking Site; and (c) City shall not enter into any lease or other agreement regarding the Replacement Parking Site except for leases or other agreements that may be terminated upon transfer of the Replacement Parking Site to Developer pursuant to this Agreement upon thirty (30) days notice without payment of any cancellation or termination fee. 10. Conditions Precedent to Closing City's obligation to transfer the Replacement Parking Site to Developer pursuant to and subject to all of the terms, covenants, conditions and obligations of Developer set forth in this Agreement is expressly conditioned on, and subject to satisfaction of each of the following conditions precedent which must be met to the reasonable satisfaction of City prior to the Closing Date (as defined in Section 13 of this Agreement) 10.1 Representations and Warranties. All representations and warranties of Developer and City contained herein shall be true, accurate and complete at the time of the Closing as if made again at such time 10.2 Performance. Developer shall have performed all obligations to be performed by it hereunder on or before Closing (or, if earlier, on or before the date set forth in this Agreement for such performance) Developer is not in Default at the time of Closing, and there is no event that with the giving of notice, the passage of time or both that would constitute an Event of Default under this Agreement. 10.3 Simultaneous Contribution of SPI Land. The SPI Contribution Agreement entered into by Developer with SPI for contribution of the SPI Land: (a) is in full force and effect, (b) Developer has approved the condition of title to each of the parcels constituting the SPI Land, has completed or waived its due diligence review of such parcel, and is ready to close the contribution of the SPI Land to Developer simultaneous with the closing of its acquisition of the Replacement Parking Site -14- P ORMR52UB OW14/W 104 Vacation of Alley; Completion of Boundary Line Adjustment Process. The vacation of the existing public alley has been approved by City, the various property owners have executed quit claim deeds conveying their respective portions of the vacated alley to City, and the reconfiguration of the City Property and Private Land into seven separate legal lots pursuant to boundary line adjustment(s) has been approved by all necessary government authorities, all confirming deeds necessary in connection with such boundary line adjustinent(s) have been executed by each of the owners of the affected parcels, subject only to recording of the alley vacation quit claim deeds and boundary line adjustment surveys and the confirming deeds in the real property records of King County. 10.5 Simultaneous Exchange of Harrison Property Harrison and City (i) have executed all documents required to exchange the Harrison Property for the Harrison Exchange Property, (n) the City, Developer and Anderson have agreed on the terms of the restrictive covenant contemplated under the Pooling Agreement and (in) the parties are ready to close the exchange simultaneous with the closing of the acquisition of the Replacement Parking Site. 10.6 Application for Parking Garage Building Permits and Downtown Desim Review. Developer has submitted to the City completed applications for all permits necessary to commence construction of the Parking Garage and has filed a completed Downtown Design Review Application and other information required to enable the City to complete design review of the Parking Garage. 107 Availability of Construction and Equity Financing for Protect SSprin,i4board. Developer has obtained a commitment letter from a financial institution in an amount sufficient to complete the construction of Project Springboard on terms and conditions acceptable to City and demonstrated to City that it has sufficient cash equity to complete construction of the Parking Garage 10.8 Title Policies The Title Company is in a position to issue the Developer's Title Policy in accordance with Section 6 2 and the Title Company is in a position to issue City an ALTA lender's policy of title insurance insuring the City Mortgage as a first lien on the Property, subject only to the Property Permitted Exceptions. 10.9 No Bankruptcy. Neither Developer nor any Private Owner, or any of their respective officials, officers, members or managers: (a) has applied for or consented to the appointment of a receiver, custodian or trustee for it or any of its property, (b) has become insolvent, (c) has failed generally or admitted in writing its inability to pay its debts as they become due, (d)has consolidated, liquidated or dissolved, (e) has filed a petition or action for relief relating to any federal or state bankruptcy, insolvency, moratorium or similar statute or any other law or laws for the relief of or relating to debtors, or (f) has made an assignment for the benefit of its creditors or entered into an agreement of composition with its creditors, nor (g) has a petition been filed by or against Developer, any Private Owner or any of their respective officials, officers, members or managers under any federal or state bankruptcy, reorganization, insolvency, moratorium or similar statute or any other law or laws for the relief of or relating to debtors. -15- P1DRS%DRS2UB 09114/05 i 10 10 Condition of Property. As of the date of this Agreement there is a building located on the SPI Land and SPI is engaged in legal proceedings to resolve issues related to on-going occupancy of the building. SPI has advised the City and the Developer that it expects to resolve such issues and arrange for demolition of the building prior to Closing Accordingly, unless the parties agree otherwise, it shall be a condition precedent to Closing that City and each of the Private Owners is in a position to deliver possession of that portion of the real property owned by it, vacant, with all above-ground improvements demolished, free of debris or trash, and not subject to the occupancy and/or possession by any tenant or any other Iperson or entity. 10.11 City's Right to Terminate. The foregoing conditions contained in this Section 10 are intended solely for the benefit of City, if any of the foregoing conditions are not satisfied. City shall have the right at its sole discretion either to waive the condition in question and proceed with the exchange or, in the alternative, to terminate this Agreement upon written notice to Developer and the Private Owners, whereupon this Agreement shall terminate, and neither party hereto shall have any further rights, duties or obligations under this Agreement i It. City Representations. In order to induce Developer to enter into this Agreement and the transactions contemplated hereby, City makes the following representations as of the date of this Agreement and again as of the Closing Date and the Public Parking Easement Acceptance Date. 11.1 Authority City is a municipal corporation duly organized, validly existing and in good standing under the laws of the State of Washington. Pursuant to City Council Resolution No adopted , 2005, the City Council authorized its Mayor to execute and deliver this Agreement on behalf of City. 112 No Litigation. There is no litigation pending or, to City's knowledge, threatened in writing, against City before any court or administrative agency which might result in City being unable to exchange the Replacement Parking Site to Developer for the Public Parking Easement upon Final Completion of the Parking Garage and satisfaction of the conditions set forth pursuant to this Agreement. In the event that an administrative proceeding or lawsuit is filed against the City prior to the Closing Date, and a result thereof either City or the Developer is unable to perform its obligations under this Agreement, either party may extend the Closing Date for up to ninety (90) days to enable the parties to dissolve any injunction, quash any Its pendens or resolve any litigation, provided, however, neither party shall be required to pay money, settle a claim or post a bond. If the legal action has not been resolved by the end of such period, either party may thereafter terminate this Agreement upon ten (10) days written notice to the other party and except as otherwise expressly provided herein, neither party shall have any further rights, duties or obligations under this Agreement 11.3 No Condemnation. There is no condemnation proceeding pending against the Replacement Parking Site -16- PIDRSDR52UB 09/14/05 114 Construction Liens. City has not authorized the performance of any improvements to be made to the Replacement Parking Site which might form the basis of any construction liens 11.5 Survival All of the representations and warranties of City contained in this Section 11 shall survive the Closing Date. 12. Developer's Representations. In order to induce City to enter into this Agreement and the transactions contemplated hereby, Developer makes the following representations as of the date of this Agreement and again as of the Closing Date and the Public Parking Easement Acceptance Date: 12.1 Authority Developer is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Washington, and has the power to carry on its business as now being conducted. All limited liability company action on the part of Developer and all corporate or other action on the part of its managers and members necessary for the authorization, execution, delivery and performance of this Agreement, the Pooling Agreement, the contribution and exchange agreements, the City Mortgage and the Public Parking Easement and any other document executed in connection with this Agreement or the Pooling Agreement (collectively, the "Developer Agreements") has been duly taken. Developer has full power and authority to enter into, execute and deliver the Developer Agreements and to perform its obligations under the Developer Agreements The Developer Agreements when executed and delivered by Developer will be the legal, valid and binding agreement of Developer, enforceable in accordance with their respective terms Neither the execution and delivery of this Agreement or the other Developer Agreements nor the consummation of the transactions contemplated hereunder or thereunder will constitute a breach of any evidence of indebtedness or other financing agreement to which Developer is a party or by which Developer is bound. 12.2 All Consents Obtained. No consents, approvals, permissions, authorizations, orders or licenses of any person or of any Governmental Authority (except for City approval of the Parking Garage Construction Documents and issuance of building permits necessary for construction of the Project Springboard Improvements) is necessary in connection with the execution, delivery and performance of the Developer Agreements by Developer or any transaction contemplated hereby or thereby, except as may have already been obtained by Developer prior to the date of this Agreement. There is no provision in Developer's certificate of formation or organizational documents nor any provision in the organizational documents of any member or manager of Developer which would be contravened by the execution and delivery of this Agreement or the other Developer Agreements or by the performance of any provision, condition, covenant or other term required to be performed by Developer under this Agreement or the other Developer Agreements. 12.3 Availability of Construction and Equity Financing for Proiect Springboard. Developer has obtained a commitment letter from a financial institution in an amount sufficient to complete the construction of Project Springboard, has sufficient cash equity to complete construction of the Parking Garage, has satisfied all conditions precedent to disbursement of loan proceeds for construction of Project Springboard (subject only to Final -17- P 1DRSDRS2U8 MUMS Completion of the Parking Garage) and is prepared to close any construction loan financing simultaneous with recording of the Public Parking Easement on the Public Parking Easement Acceptance Date. 12.4 No Litigation There is no action, suit, proceeding or investigation pending, or to Developer's knowledge threatened in writing, before any agency, court or other Governmental Authority affecting Developer or any member or manager of Developer which could have a Material Adverse Effect on the legal existence or powers of Developer or any manager or member thereof, or its financial condition or have a Material Adverse Effect on the ability of Developer or any manger or member of Developer to perform its obligations under this 1 Agreement or the other Developer Agreements and neither Developer nor any manager or member of Developer is in default with respect to any Requirement of Law that could result in any such effect. i 12.5 No Land Speculation. Developer represents and agrees that the Property will be used for purposes of timely redevelopment as set forth in this Agreement and not held by Developer for speculation in landholding For purposes of this Agreement, "Land Speculation" is defined as Developer acquiring the Property and not commencing construction of the Parking Garage on or before March 31, 2006, or not achieving Substantial Completion of the Parking Garage on or before September 30, 2006 ("Substantial Completion Date") which failure to commence construction or achieve Substantial Completion is not due to Unavoidable Delay. Developer understands and agrees that City would not have entered into this Agreement but for this representation and that the following factors and the qualification and expertise and experience of Developer and its members in the development of real property are of particular concern to the community and City. 12.5.1 The importance of the redevelopment of the Property to the general welfare of the community; 12 5.2 The vacation of the public alley and the reconfiguration of the Property to accommodate the development of Project Springboard on the Property, 12.5 3 The agreement by Developer to commence and complete construction of the Parking Garage on the Replacement Parking Site within nine (9) months following the Closing at its sole cost and expense, which Parking Garage shall have a minimum capacity of three hundred fifty (350) parking spaces for multi-passenger motor vehicles, which is an additional seventy (70) parking stalls beyond that required under Requirements of Law for the Project Springboard Improvements, 12.5 4 The agreement by Developer to grant City the Public Parking Easement to provide City and members of the general public a perpetual easement to park in a minimum of seventy (70) parking stalls in the Parking Garage which shall be available for public parking at all times and in addition, the right to park in any open parking stall on a first-come, first-serve basis twenty-four (24) hours a day, seven(7) days a week initially at no charge; 12.5.5 The agreement by Developer to manage the Parking Garage so that a minimum of seventy (70) parking spaces are reserved for public parking by members of the -l 8- P 1DRS1DRS2UB 09114105 general public at all times and the remaining parking spaces are available on a first come, first serve basis to members of the general public at all times, 12.5 6 The agreement by Developer to operate the Parking Garage as a self-park, public parking garage open to members of the general public twenty four (24) hours a day, seven (7) days a week, initially without charge and in a manner which maximizes the availability of Short-Term Parking at all times; 12.5.7 The agreement by Developer to operate and maintain the Parking Garage at Developer's sole cost and expense, in first-class order, condition and repair; 12 5.8 The reliance by City upon the unique qualifications and ability of Developer to develop Project Springboard as a mixed-use integrated development which provides an approximately 74-room hotel with conference facilities, indoor water park, retail and restaurant space, and approximately 120 units of market rate condominium housing, in addition to the Parking Garage; and 12.5 9 The fact that there will be no transfer of a controlling interest in Developer or any member or any manager therein, nor any transfer of all or any portion of the Property by Developer prior to Final Completion of the Parking Garage, without the prior written consent of City. 12.6 Survival. All of the representations and warranties of Developer contained in this Section 12 shall survive the Closing Date. 13. Closing and Escrow. 13.1 Time and Place of Closing. The Closing shall be held at the offices of the t Escrow Agent on a date chosen by Developer that is after expiration of the Due Diligence Period (as defined above) but in any event on or before December 15, 2005 (the "Closing Date"). As used in this Agreement, "Closing" and "Closing Date" means the date on which all appropriate documents are recorded in order to accomplish the alley vacation, boundary line adjustment and various property contributions and exchanges contemplated under the Pooling Agreement and transfer title to the Property to Developer, and the City Mortgage, and the restrictive covenant affecting the Anderson Property have each been recorded Developer and City shall place into escrow all instruments, documents and moneys necessary to complete the acquisition of the Replacement Parking Site in accordance with this Agreement, and Developer shall place into escrow all instruments, documents and moneys necessary to complete the contribution of the remainder of the Property from SPI in accordance with the SPI Contribution Agreement. 13.2 Documents to be Delivered by City. City shall obtain and deliver to Escrow Agent at Closing the following documents (all of which shall be duly executed and acknowledged where required) 13.2.1 The Deed, together with a duly executed real estate excise tax affidavit; 13.2.2 FIRPTA Affidavit; -19- PORSORS2US 09/14/05 13.2.3 such other documents as may be required by the Title Company and as are consistent with the provisions of this Agreement, and 13.2.4 City's share of closing costs. 13.3 Delivery by Developer. At Closing, Developer shall obtain and deliver to Escrow Agent the following (all documents shall be duly executed and acknowledged where required). j13.3.1 The executed real estate excise tax affidavit; 13.3 2 the City Mortgage; 13.3.3 such resolutions, authorizations, certificates and other documents or other agreements relating to Developer as are reasonably required in connection with closing this transaction, 13 3.4 Developer's share of closing costs. 13.4 Other Instruments. City and Developer shall each deposit, and the various parties to the Pooling Agreement shall each deposit, such other instruments as are reasonably required by Escrow Agent or otherwise required to close the transactions contemplated by the Pooling Agreement and this Agreement and consummate the exchange of the Property in accordance with the terms of this Agreement, the SPI Contribution Agreement and the Pooling Agreement, including without limitation, any boundary line adjustment surveys, confirming deeds, documents confirming the vacation of the existing public alley, alley vacation quitclaim deeds, and related tax segregation agreements, the various deeds exchanging a portion of the SPI Land for land owned by the City and deeds exchanging the Harrison Property for the Harrison Exchange Property and the restrictive covenant affecting the Anderson Property. 13.5 Prorations. All utilities and special assessments shall be prorated as of the Closing. Because City is exempt from property taxes, no proration of ad valorem property taxes is required; however, Developer shall be responsible for payment of all property taxes and all special assessments and local improvement district assessments, if any, which affect the Property from and after the Closing ' 136 Payment of Costs. City shall pay the premium for a standard coverage owner's policy of title insurance in an amount equal to the agreed valuation of the Replacement Parking Site, the premium for any title insurance it elects to obtain insuring the lien of the City Mortgage as a first lien and any real estate excise taxes applicable to the sale The escrow fee shall be split equally between City and Developer Developer shall pay all recording costs, any increase in the title insurance premium attributable to extended coverage, any endorsements it requests of the Title Company, and the costs of any survey. City and Developer shall pay their own respective costs incurred with respect to the consummation of the purchase and sale of the Property including, without limitation, attorneys' fees and the fees and expenses of their respective consultants Developer and City waive the services of the Escrow Agent in disbursing closing funds to satisfy unpaid utility charges affecting the Property pursuant to RC W 60.80. -20- PXDRS\DRS2UB 09/14/05 13.7 Closing of Contribution of SPI Land Closing of the acquisition of the Replacement Parking Site is expressly subject to the simultaneous closing of SPI's contribution of the SPI Land to Developer. 13.8 Closing Simultaneous with Other Transactions Contemplated under Pooling Agreement. Closing of the acquisition of the Replacement Parking Site is also expressly , subject to the simultaneous closing of the alley vacation, recordation of the alley vacation deeds, boundary line adjustment and recording of the boundary line adjustment confirming deeds, and related tax segregation agreements, the various deeds exchanging a portion of the SPI Land for land owned by the City and exchanging the Harrison Property for the Harrison Exchange Property and the restrictive covenant affecting the Anderson Property. Escrow Agent shall establish a series of sub-escrows for each of the parcels constituting the real property and shall coordinate the closings of the various property transactions affecting each of the parcels, all of which shall be deemed to have closed simultaneously and none of which shall be deemed to have closed unless all of the transactions close. Developer shall pay one-half of the escrow charges associated with the escrow and each of the other Owners shall pay the other half of the escrow charges associated with the portion of the real property owned by it 13.9 Recordation. Provided that the Title Company has issued or is unconditionally prepared and committed to issue Developer the Developer Title Policy and to issue City the City Loan Policy, then Escrow Agent is authorized at 8 00 a.m. (or as soon thereafter as possible on the Closing Date) to record the following documents in the official records of King County, Washington' 13.9.1. Record alll quitclaim deeds conveying the vacated alley to City: 13.9.2 Record the boundary line adjustment and all confirming ' quitclaim deeds executed by the various owners required in order to vest title in accordance the boundary line adjustment survey; 13.93 Record the deed of the remaining SPI Land from SPI to Developer; , 13.9.4 Record the restrictive covenant encumbering the Anderson Property; 139.5 Record the deeds exchanging the Harrison Property for the Harrison Exchange Property, 139.6 Record the Deed; 13.9.7 Record the City Mortgage; 13.9.8 Record the Memorandum of this Agreement; -21- PiDRS\ORS2US 09/14105 13.9.9 Record any reconveyance documents or releases that may be required to eliminate any liens, mortgages, deeds of trust or other monetary liens against the Property, the SPI Land, the Harrison Property or the Harrison Exchange Property that may be required in order to issue the Developer the Developer Title Policy and the City the City Loan Policy; I13.9 10 Deliver the FIRPTA Affidavit and the Developer Title Policy to Developer and deliver the City Loan Policy to City. 13.911 Deliver closing statements and any other documents delivered in connection with the closing of the various transactions to the parties entitled thereto. 14. Possession. Developer shall be entitled to possession of the Property on Closing, free and clear of all liens, encumbrances or other exceptions other than the Permitted Exceptions j and any liens, encumbrances or other exceptions arising through the actions of Developer or its agents, employees or consultants. 15. Construction of Parking Garage. 15.1 Construction of Parking Garage; Construction Phasin Developer shall, I at its sole cost and expense, develop and manage the construction of the Parking Garage in substantial accordance with the Parking Garage Construction Documents. Developer may enter into a series of construction contract(s) for various components of the overall project with one or more contractors including a separate construction contract for the Parking Garage as Developer may determine taking into consideration availability of labor, materials, weather, permitting restrictions, status of leasing, progress of overall design and development and other construction- related factors. City and Developer further agree that due to the nature of Project Springboard, the Project shall be constructed in stages with the Parking Garage constructed as part of Phase One. City shall not be obligated to issue building permits for the remainder of the Project Springboard Improvements nor shall Developer commence construction of the remainder of Project Springboard Improvements until after the Final Completion of the Parking Garage and the Public Parking Easement Acceptance Date without the prior written consent of the City. 152 Commencement and Completion of Construction. Developer shall cause its general contractor to commence construction of the Parking Garage pursuant to the Parking Garage Construction Documents on or before March 31, 2006 and to thereafter diligently and continuously prosecute construction of the Parking Garage so as to achieve Substantial Completion of the Parking Garage on or before September 30, 2006 (the "Substantial Completion Date") in a good and workmanlike manner, free from defects in work or materials and in substantial accordance with the Parking Garage Construction Documents, and free and clear of all liens The Parking Garage shall be constructed in accordance with all Requirements of Law applicable to the Parking Garage and the Property. 15.3 Unavoidable Delay; Outside Completion Date. The existence of Unavoidable Delays shall excuse contractors and Developer for delays in achieving Substantial Completion of the Parking Garage on or before the Substantial Completion Date. For purposes of this Agreement, "Unavoidable Delay" means strikes, riots and judicial and/or regulatory -22- P\DRS0RS2UB 0904/05 action by federal, state or local governmental agencies that enjoin or delay construction on the Parking Garage on the Property, acts of God, war or acts of terrorism that delay construction of the Parking Garage. In the event the Parking Garage has not achieved Final Completion on or before March 31, 2007, for any reason whatsoever including, but not limited to, the existence of Unavoidable Delay (the "Outside Completion Date"), Developer shall be in default under this Agreement and City may exercise the remedies set forth in Section 25 of this Agreement 15.4 Hiring Program Developer shall use reasonable good faith efforts to cause its contractors and subcontractors hired to work on various phases of Project Springboard to implement a recruitment strategy that encourages hiring of City residents. 15.5 Construction Staging, Remaining Building Demolition, Temporary Parking Area A plan for construction staging shall be prepared by Developer and approved by City prior to commencement of construction of the Parking Garage. In order to minimize the impact of construction on surrounding businesses and disruption to downtown retail activity, Developer and City may enter into a separate agreement setting forth the terms and conditions under which Developer may utilize all or a portion of the Town Square Plaza Site and City and Developer may utilize the remainder of the Property for construction staging purposes during the course of construction of their respective projects Developer acknowledges that time is of the essence in the construction of the Parking Garage and that City intends to commence development of the Town Square Plaza Site as a town square plaza immediately following completion of construction of the Parking Garage. Developer agrees to demolish any buildings located on the Town Square Plaza Site, at its cost and expense, remove all construction trailers, materials and equipment then stored on the site and deliver possession of the Town Square Plaza Site vacant, free or trash or other debris and not subject to possession by any person upon sixty (60) days prior written notice from City and in any event prior to the Public Parking Easement Acceptance Date City will advise Developer as soon as it has determined when it will need possession of the Town Square Plaza Site. Developer shall, in consultation with City, install directional signage on the Property and the public streets adjoining the Property advising members of the public on the location and means of access to and from any temporary public parking area that may be located on the Property or the Town Square Plaza Site. 15.6 Project Manager; Construction Progress Reports. Developer shall appoint an experienced project manager to manage development of Project Springboard prior to Closing Developer may assign other qualified construction personnel to the construction of Project Springboard and the Parking Garage as needed to construct the Parking Garage in accordance with the requirements of this Agreement so as to achieve Substantial Completion of the Parking Garage on or before the Substantial Completion Date City shall have the right, but not the obligation, to inspect or hire an independent consulting architect, engineer or other appropriate constriction professional to inspect the construction of the Parking Garage as it progresses and to review the construction work and its compliance with the Parking Garage Construction Documents and this Agreement. The cost of any such construction professional shall be paid by City City shall provide written notice to Developer of such inspection which shall be coordinated with Developer and its contractors so as to not interfere with or delay construction of the Parking Garage. Developer shall record the progress of the Parking Garage and shall submit periodic progress reports to City, and shall provide such information about the on-going progress of construction as City may reasonably request from time to time ' -23- P QRSORSWB MUM i I15.7 Changes to Parking Garage Construction Documents. 15.7.1 No Reduction in Parking Garage Capacity or Other Characteristics Developer shall not (a) reduce the capacity of the Parking Garage below three hundred fifty (350) parking stalls for multi-passenger motor vehicles, (b)make any change to the Parking Garage Construction Documents which would require City's approval under Section 5.2 above, or (c) make any change to the Parking Garage Construction Documents that would violate, or cause a violation of, any Requirement of Law 15 7 2 Changes to Construction Documents. In the event Developer desires to make any material change to the Parking Garage Construction Documents not prohibited by subsection 15.7 1 above, such material change shall first be submitted by Developer to City accompanied by a statement from Developer's architect delineating the nature and extent of the changes, for review and approval or disapproval. Within five (5) business days after such request for change has been received by City, City shall give Developer written notice of its approval or disapproval thereof, specifying in the case of its disapproval its reason therefore. Except as otherwise provided herein, approval of such change shall not be unreasonably withheld, conditioned or delayed. The extent of City's approval rights with respect to any material change(s) shall be the same as would have applied to City's approval of the Parking Garage Construction Documents in the first instance. If City fails to disapprove such change within five (5) business days after the receipt of such change, the same shall be deemed to have been approved by City 15.8 Disclaimer: City Not Liable for Construction of Project Sprin bg oard Improvements or Parking Garage. Notwithstanding any provision of this Agreement to the contrary, City is under no obligation to, nor shall it construct or supervise the construction of the Project Springboard Improvements or the Parking Garage. It is understood and agreed that City's rights to approve the Parking Garage Schematic Design Documents and the Parking Garage Construction Documents as provided in this Agreement is for the sole purpose of protecting its rights under this Agreement, as beneficiary under the City Mortgage and as the benefited party under the Public Parking Easement, and shall not constitute any representation or warranty, express or implied, as to the adequacy of the design or any obligation on City to ensure that work or materials are in compliance with Requirements of Law, the Parking Garage Schematic Design Documents or any building requirement imposed by any governmental agency. City is under no obligation or duty and disclaims all responsibility to pay for the cost of construction of the Project Springboard Improvements, including, but not limited to, the Parking Garage, the cost of which is and shall at all tunes remain the sole liability and responsibility of Developer. Nothing contained in this Agreement shall be construed as the consent or request of City, express or implied, for the performance of any labor or services or for the furnishing of any materials or equipment for any construction, alteration, addition, repair or demolition of the 1 Property (or any part thereof) NOTICE IS HEREBY GIVEN THAT CITY WILL NOT BE LIABLE FOR ANY LABOR, SERVICES, MATERIALS OR EQUIPMENT FURNISHED, OR TO BE FURNISHED TO DEVELOPER FOR CONSTRUCTION OF THE PROJECT SPRINGBOARD IMPROVEMENTS, INCLUDING, BUT NOT LIMITED TO, THE PARKING GARAGE OR ANYONE HOLDING AN INTEREST IN THE PROPERTY (OR ANY PART THEREOF) THROUGH OR UNDER DEVELOPER. -24- P10RSIDRS2U6 09/14/05 15.9 Payment of Parking Garage Costs, Construction Liens The cost of development and construction of the Parking Garage, including, without limitation, any and all sales, business and occupation, employment, withholding and other taxes which may be payable in connection therewith, shall be paid by Developer at its sole cost and expense. Prior to the Final Completion of the Parking Garage, Developer shall pay or cause to be paid within thirty (30) days after the filing thereof any and all construction or other liens that may be filed against the Parking Garage or the Property in connection with labor, services, materials, supplies or equipment furnished or alleged to have been furnished to or upon the request of Developer (collectively, "Liens"). Developer reserves the right to contest the validity or amount of any such Lien claims in good faith provided that Developer shall within thirty (30) days after the filing of such Lien, discharges said Lien of record or records a bond which complies with the , requirements of RCW 60.04 161 eliminating such Lien as an encumbrance against the Parking Garage or the Project Site. In the event Developer shall fail to so remove any such Lien, City may take such action as City shall reasonably determine to remove such Lien and all costs and expenses incurred by City including, without limitation, amounts paid in good faith settlement of such Lien and attorneys' fees and costs shall be secured by the City Mortgage and shall be paid by Developer within ten (10) days following request. Developer's obligations pursuant to this Section 15 9 shall survive the expiration or earlier termination of this Agreement. 15.10 Assignment of Contracts. Developer shall assign all of its nght, title and interest under (a) the architect's agreement and construction contracts for the Parking Garage and the plans and specifications as additional security for the performance of Developer's obligations under this Agreement and (b) shall cause the architect and contractors to execute a consent to assignment of the architect's agreement and construction contracts, respectively, prior to Closing. Developer shall not further assign its rights under the architect's agreement and/or construction contracts without the prior written consent of the City. Developer shall enforce and secure the performance of all conditions and obligations to be performed or observed by the architect or the contractors under the architect's and construction contracts and shall perform and observe in a timely manner all of its obligations under the architect's and construction contracts Developer shall notify City of any default or breach of or under the architect's contract or the construction contracts Upon the occurrence of an Event of Default by Developer under this Agreement, City shall have the right, but not the obligation, and Developer hereby authorizes City, to take over and complete construction of the Parking Garage in accordance with its rights under this Agreement, to enforce Developer's rights under the architect's and construction contracts and to receive the performance of the architect and contractors thereunder. The assignments made herein in no way affect Developer's ability to exercise its rights under the architect's agreement or any construction contract prior to any Event of Default by Developer under this Agreement. City does not assume any of the Developer's obligations or duty under the architect's agreement or any construction contract, including, without limitation the obligation to pay for services rendered or materials supplied thereunder unless and until City shall expressly assume any such obligation by written notice to the architect or the contractors following the occurrence of an event of default by the Developer under this Agreement. In the event of an Event of Default by Developer and subsequent assumption by the City of the obligations of Developer under the architect's agreement or any construction contract, the cost of performing the obligations of Developer thereunder and hereunder, together with interest thereon at the rate of twelve percent (12%) per annum from the date incurred until repaid in full shall be secured by the City Mortgage -25- P%DRSVDRSZUB 09/14/05 i 16. Developer Financing. Prior to Final Completion of the Parking Garage Developer shall not grant any lien, mortgage, security interest or other interest in the Property except the City Mortgage without the prior written consent of the City, which consent shall not be unreasonably withheld so long as such lien is expressly subordinated to the City's rights under this Agreement and the City Mortgage and any such lender expressly agrees to subordinate its lien to the Public Parking Easement. Notwithstanding any other provision of this Agreement, i following Final Completion of the Parking Garage but prior to final completion of Project Springboard, Developer shall not have the right to mortgage, pledge, encumber or assign its rights under this Agreement or the Property, in whole or in part, except in connection with financing of the construction of Project Springboard by Construction Lender, and shall not encumber the Property as security for a loan to acquire, construct, finance or refinance any real property other than the Property Prior to Final Completion of the Project Springboard Improvements all proceeds of the Construction Loan shall be used solely to pay for costs associated with construction of Project Springboard and shall not be used for any other purpose or applied to any other property or project. 17. Indemnification. 17.1 Developer's Indemnification Developer shall protect, defend, indemnify, and save harmless City and its officers, officials, employees and agents, from any and all claims, demands, suits, penalties, losses, damages,judgments, or costs of any kind whatever (hereinafter "claims"), arising out of or in any way resulting from Developer's officers, employees, agents, contractors and/or subcontractors of all tiers, acts or omissions, performance or failure to perform this Agreement Developer's obligations under this Section 17 shall include, but not be limited to 17.1.1 The duty to promptly accept tender of defense and provide defense to City at Developer's own expense. L 17.12 The duty to indemnify and defend City from any claim, demand and/or cause of action brought by or on behalf of any of Developer's employees or agents. The foregoing duty is specifically and expressly intended to constitute a waiver of Developer's immunity under Washington's Industrial Insurance Act, RCW Title 51, as respects City only, with a full and complete indemnity and defense of claims made by Developer's employees or agents The parties acknowledge that these provisions were mutually negotiated and agreed Iupon by them. 17.1.3 Developer shall indemnify and defend City from and be liable for all damages and injury which shall be caused to owners of property on or in the vicinity of the construction of Project Springboard or the Parking Garage or which shall occur to any person or persons or property whatever arising out of this Agreement, including, but not limited to, members of the general public who utilize any temporary parking area for parking purposes, whether or not such injury or damage is caused by negligence of the contractors or caused by the inherent nature of the construction of Project Springboard or the Parking Garage. -26- P 1DRS1DRS2U8 09114105 1 17.1.4 In the event City incurs any judgment, award, and/or costs arising therefrom, including attorneys' fees, to enforce the provisions of this Section 17, all such fees, expenses, and costs shall be paid by Developer. , Notwithstanding the provisions contained in Subsection 17.1 above, Developer's obligation to indemnify City shall not extend to any claim, demand or cause of action to the extent caused by the negligence of City or breach of this Agreement by City. 17.2 Notice of Claim. Any person making a claim for indemnification pursuant to this Section 17 (an "Indemnified Party") must give Developer written notice of such claim (an "Indemnification Claim Notice") promptly after the Indemnified Party receives any written notice of any action, lawsuit, proceeding, investigation or other claim (a "proceeding") against or involving the Indemnified Party by a government entity or other third party, or otherwise discovers the liability, obligation or facts giving rise to such claim for indemnification, provided that the failure to notify or delay in notifying Developer will not relieve Developer of its obligations pursuant to this Section 17 except to the extent that Developer's ability to defend against such claim is actually prejudiced thereby Such notice shall contain a description of the claim and the nature and amount of such loss (to the extent that the nature and amount of such loss is known at such time). 18. Insurance. From and after the execution of this Agreement and until Final Completion of the Parking Garage and City's acceptance of the Public Parking Easement, Developer shall maintain builder's risk, commercial general liability insurance and such other insurance as may be required under the terms of the City Mortgage. From and after City's acceptance and recordation of the Public Parking Easement in the King County real property records, Developer shall maintain insurance with respect to its ownership, operation, maintenance and repair of the Parking Garage as may be set forth in the Public Parking Easement. 19. Completion of Parking Garage. 19.1 Substantial Completion. "Substantial Completion" means that each of the following events shall have occurred with respect to the Parking Garage prior to the Substantial Completion Date- 19 1.1 Architect's Certification. Architect has issued its "Certificate of Substantial Completion" AIA Document G704 stating that the portion of the work under the construction contract for the Parking Garage is substantially complete in substantial accordance with the Parking Garage Construction Documents ' 19 1.2 Proiect Substantially Completed. The Parking Garage has been Substantially Completed in accordance with all Requirements of Law and Developer has received no notice of any violation of any Requirements of Law which have not been fully cured to the reasonable satisfaction of Developer, City and the applicable governmental authority with jurisdiction over the Parking Garage or the Property ' 19 1.3 Temporary Certificate of Occupancy. City has issued a temporary certificate of occupancy for the Parking Garage permitting its use as a parking garage ' -27- P1DRSORS2US 09/14105 19.1.4 Owner Acceptance Developer has accepted the Parking Garage as complete subject to completion of normal punch list items 191 5 Completion of Punch List Items Following Substantial Completion of the Parking Garage, Developer shall cause all punch list items to be completed promptly in accordance with the Parking Garage Construction Documents. 19.2 Final Completion of the Parking Garage. Developer shall give written notice to City at least thirty (30) days prior to the date upon which the Parking Garage shall have achieved Final Completion, which date shall be a date prior to the Outside Completion Date. "Final Completion" means that each of the following items shall have occurred with respect to the Parking Garage 19.21 Certificate of Occupancy. City shall have issued a final 1 unconditional certificate of occupancy for the Parking Garage permitting the use and occupancy of the Parking Garage for parking purposes. 19.2.2 Contractors' Certification. Each contractor involved in the construction of the Parking Garage shall have issued its "Certificate of Substantial Completion" together with its Affidavit of Payment of Debts and Claims, AIA Forms 706 and 706A together i with final waivers and releases of lien from all persons who have provided labor, services, materials or equipment in connection with the construction of the Parking Garage. ' 19 2.3 Punch List Items Completed. All punch list items have been completed to the reasonable satisfaction of Developer and City. 19 2 4 Construction Costs Paid. Developer shall have submitted evidence reasonably satisfactory to City that all costs associated with the construction of the Parking Garage have been paid in full. 19.2.5 No Construction Liens. The period for filing construction liens has expired or releases or discharges of construction liens in form and substance satisfactory to City ' have been obtained by Developer from all contractors in accordance with the Parking Garage Construction Documents. 19 2.6 Private Street Completed The private street to be constructed by Developer connecting Smith and Harrison Streets as part of Project Springboard and which provides vehicular access to and from the Parking Garage and the public streets adjoining the Property has been completed to the reasonable satisfaction of City and can be used by pedestrian and vehicular traffic. 19 2.7 Garage Operational. All signage and graphics required under the Parking Garage Construction Documents have been installed, all security systems have been installed and are operational, the Parking Garage is no longer in use as a construction staging area for the storage of construction materials, machinery and equipment or to provide temporary parking for construction workers' automobiles and equipment and the entire Parking Garage is open to members of the general public for the parking of vehicles (the "Opening Date"). I -28- PORSORMB 09/14/05 20. Acceptance of Public Parking Easement, Release of City Mortgage. City shall accept the Public Parking Easement and release the City Mortgage within thirty (30) days following Final Completion of the Parking Garage and the Opening Date ("Public Parking ' Easement Acceptance Date"). The acceptance of the Public Parking Easement shall be held at the offices of the Escrow Agent on the Public Parking Easement Acceptance Date. As used in this Agreement, the Public Parking Easement Acceptance Date means the date on which the Public Parking Easement is recorded, and the City has executed a request for full reconveyance of the City Mortgage Developer and City shall place into escrow all instruments, documents and moneys necessary for City to accept the Public Parking Easement in accordance with this Agreement upon satisfaction of the conditions precedent set forth in Section 20.1 and delivery of the documents and other items set forth in Sections 20.2 and 20.3 to Escrow Agent: , 20.1 Conditions Precedent to City's Obligation to Accept Public Parking Easement. City's obligation to accept the Public Parking Easement in satisfaction of Developer's obligations under this Agreement is expressly conditioned on, and subject to satisfaction of each of the following conditions precedent which must be met to the reasonable satisfaction of the City prior to the Public Parking Easement Acceptance Date• 20.1.1 Representations and Warranties. All representations and warranties of Developer and City contained herein shall be true, accurate and complete as the time of the Public Parking Easement Acceptance Date as if made again at such time. 20 1.2 Performance. Final Completion of the Parking Garage as defined in Section 19 has occurred and Developer shall have performed all other obligations to be performed by it hereunder on or before the Public Parking Easement Acceptance Date (or earlier, on or before the date set forth in this Agreement for such performance) 20.1.3 Approval of Condominium Documentation. City shall have approved the proposed declaration and the survey map and plans for the master condominium for the Project Springboard Improvements, which approval shalt not be unreasonably withheld, conditioned or delayed; provided, however, that such declaration shall provide, inter alia, that (i) the Parking Garage is a separate condominium unit, (11) there shall be no assessments, or charges for on-going operation, maintenance and repair of the Parking Garage levied against City, in its capacity as the benefited party under the Public Parking Easement, and (ul) no charges shall be imposed on members of the general public to park in the Parking Garage. 20.1.4 Title Policy. The Title Company is in a position to issue the City Title Policy in accordance with Section 7 2 insuring that City is the benefited party under the Public Parking Easement, subject only to the City Permitted Exceptions 20.1 5 No Bankruptcy Neither Developer nor any of its officials, officers, members or managers. (a)has applied for or consented to the appointment of a receiver, custodian or trustee for it or any of its property, (b) has become insolvent, (c) has failed generally or admitted in writing its inability to pay its debts as they become due, (d) has consolidated, liquidated or dissolved, (e) has filed a petition or action for relief relating to any federal or state bankruptcy, insolvency, moratorium or similar statute or any other law or laws for the relief of or relating to debtors, or (1) has made an assignment for the benefit of its creditors or entered into , -29- P 1DRSORS2US 09114/05 an agreement of composition with its creditors, nor (g) has a petition been filed by or against Developer, or any of its officials officers, members or managers under any federal or state bankruptcy, reorganization, insolvency, moratorium or similar statute or any other law or laws for the relief of or relating to debtors. 20.1.6 Additional Construction Agreements. Developer shall at its expense construct a 15 x 15 foot mechanical chase room and men and women's public restrooms which will accommodate three fixtures and two sinks in each restroom. The mechanical chase room and public restrooms will be constructed at the location shown on the preliminary site plan for the Project Springboard Improvements attached hereto as Exhibit D and in accordance with plans and specifications therefore approved by City as part of the construction of the hotel and condominium improvements The restrooms shall be maintained in good condition and repair by Developer at its sole cost and expense, and shall be available for use by members of the public at no charge. Following completion of construction Developer will grant City an easement for the mechanical chase room on terms mutually acceptable to City and Developer. 20.1.7 No Casualty of Condemnation. No material part of the Parking Garage shall have been taking in condemnation or other like proceeding (for the purpose of this Agreement a taking for a limited or indefinite term shall be deemed equivalent to a transfer of fee title) and no material part of the Parking Garage shall have been transferred in lieu of condemnation or other like proceeding and no damage to any part of the Property shall have occurred which shall not have been fully restored or replaced. ' 20.1.8 Project Springboard Improvement Building Permits Developer has obtained all permits necessary to commence construction of the remainder of the Project Springboard Improvements or has applied for and is diligently working to obtain all such permits. 20 1.9 Simultaneous Closing of Construction Financing for Remainder of Project Springboard Improvements Developer has satisfied all conditions precedent to disbursement of loan proceeds under its construction financing and is prepared to close the I construction loan financing simultaneous with recordation of the Public Parking Easement, and has completed demolition of any building then located on the Town Square Plaza Site. 20.110 City Right to Terminate The foregoing conditions contained in this Section 20.1 are intended solely for the benefit of City If any of the foregoing conditions are not satisfied, City shall have the right at its sole discretion either to waive the condition in question and proceed with the acceptance of the Public Parking Easement or to declare an Event of Default under this Agreement in which event City may exercise its remedies under Section 25 of this Agreement 20.2 Documents to be Delivered by Developer. Developer shall obtain and deliver to Escrow Agent prior to the Public Parking Easement Acceptance Date the following documents (all of which shall be duly executed and acknowledged where required). -30- PORSORSM 09/14/05 20.2.1 The Public Parking Easement executed by Developer and consented to by Construction Lender together with a duly executed real estate excise tax affidavit; ' 20.2.2 FIRPTA Affidavit; 20.2.3 Evidence that the master declaration and survey map and plans for Project Springboard have been recorded in the real property records and the Parking Garage constitutes a separate condominium unit thereunder, 20.2.4 All documents required to close the Construction Loan for the remainder of the Project Springboard Improvements including any subordination of the Construction Mortgage to the rights of the City under the Public Parking Easement to the extent required by the City and/or the Title Company; 20 2.5 such other documents as may be required by the Title Company , and as are consistent with the provisions of this Agreement; and 20.2.6 the costs required to close this transaction. i 20.3 Documents to be Delivered by City. City shall obtain and deliver to , Escrow Agent prior to the Public Parking Easement Acceptance Date the following documents (all of which shall be duly executed and acknowledged where required): 20 3 1 The Public Parking Easement executed by City, together with a r duly executed real estate excise tax affidavit; 20.3.2 A request for full reconveyance of the City Mortgage; and 20.3 3 such other documents as may be required by the Title Company and as are consistent with the provisions of this Agreement 20.4 Other Instruments. City and Developer shall each deposit such other instruments as are reasonably required by Escrow Agent or otherwise required to record the Public Parking Easement in accordance with this Agreement. 205 Proration: Payment of Costs. There shall be no proration of costs and expenses in connection with the recording of the Public Parking Easement. Developer shall be responsible for payment of all closing costs, including, but not limited to the premium for the City Title Policy, any real estate excise taxes applicable to the transfer, all costs of financing, including lender's title insurance premiums, if any, the escrow fee, and all recording costs. City and Developer shall each pay their own attorneys' fees and the fees and expenses of their , respective consultants. 20.6 Recordation. Provided that the Title Company has issued or is unconditionally prepared and committed to issue City the City Title Policy, then Escrow Agent is authorized at 8 00 a in (or as soon thereafter as possible on the Public Parking Easement Acceptance Date) to -31- P%DRS0RS2UB 09114/05 i 20.6.1 Record the Public Parking Easement and any subordination agreements in the official records of King County, Washington, 20.6.2 Deliver the FIRPTA Affidavit and the City Title Policy to City; 20.6 3 Record the reconveyance of the City Mortgage in the official records of King County; and 20 6 4 Record the Construction Mortgage and any other documents required by the Construction Lender in connection with the Construction Loan. I 21. Damage, Destruction or Condemnation Prior to Closing. In the event that prior to the Closing Date, the Replacement Parking Site is destroyed or materially damaged or if condemnation proceedings are threatened against all or any material portion of the Replacement Parkmg Site, either party shall have the right by giving written notice of such decision to the other within fifteen (15) days after receipt of written notice from City of such damage, destruction or condemnation proceedings to terminate this Agreement, in which event this Agreement shall automatically terminate, all work product prepared by or on behalf of Developer for development of the Parking Garage shall immediately and without payment of additional consideration be assigned to City, and except as expressly provided herein, neither party shall have any further rights, duties or obligations to the other under this Agreement If neither party elects to terminate this Agreement, the Agreement shall remain in full force and effect, Developer shall accept the Replacement Parking Site in its then condition and state of repair, and all proceeds of insurance or condemnation awards payable to City by reason of such damage, destruction or condemnation, if any, shall be paid or assigned to Developer upon closing and used to build the Parking Garage on the Replacement Parking Site. In the event that Developer elects to complete the acquisition of the Replacement Parking Site, it is expressly agreed that City shall have no obligation to repair or restore same. Notwithstanding anything to the contrary set forth herein, any damage to the Replacement Parking Site prior to Closing as a result of Developer's inspections shall be the responsibility of Developer, and City shall have no obligation to repair it. 22. Damage, Destruction or Condemnation After Closing, but Prior to Final Completion of the Parking Garage. 22.1 Damage or Destruction. After the happening of any casualty to the Parking Garage after the Closing but prior to the Final Completion of the Parking Garage and the Public Parking Easement Acceptance Date, Developer shall give City prompt written notice 1 thereof generally describing the nature and cause of such casualty and the extent of the damage or destruction to the Parking Garage Developer shall cause reconstruction and restoration of the Parking Garage in accordance with the Parking Garage Construction Documents and the provisions of this Agreement Developer will deposit all insurance proceeds which Developer may be entitled to receive with respect to such damage or destruction with City, who shall thereafter disburse insurance proceeds to reimburse Developer for the cost of restoration or repair in accordance with the terms, covenants, conditions, provisions and procedures set forth in the City Mortgage -32- PORSORS2US 09/14/05 222 Condemnation. After the Closing but prior to the Final Completion of the ! Parking Garage, in the event of a partial condemnation of the Project Site or the Parking Garage to the extent that the Parking Garage may still be constructed in accordance with the Parking Garage Construction Documents or may be constructed in accordance with the Parking Garage Construction Documents as modified by changes acceptable to Developer and City, Developer shall proceed to construct the Parking Garage in accordance with the Parking Garage Construction Documents, as modified, if applicable Any partial condemnation proceeds shall be deposited with City, who shall disburse condemnation proceeds to reimburse Developer for the cost of restoration or repair in accordance with the terms, covenants, conditions, provisions and procedures set forth in the City Mortgage. In the event of a condemnation of all of the Project Site or the Parking Garage or to the extent condemnation proceeds are not used to repair or restore the Parking Garage, such condemnation proceeds shall be paid to City 23. Restrictions on Transfers. 23.1 No Transfer of Rights under Agreement. Developer acknowledges that , City is relying upon the personal knowledge, expertise and experience of Developer and Plan B Development, L L C. ("Plan B"), the managing member of Developer, and Ben Errez, the , managing member of Plan B, in entering into this Agreement Developer shall not voluntarily or involuntarily sell, transfer, convey, assign or otherwise dispose of its rights under this Agreement prior to the Public Parking Easement Acceptance Date without the prior written consent of City, which consent may be withheld by City in its sole and absolute discretion 232 Restrictions on Transfer of Interests in Developer. Prior to the Public Parking Easement Acceptance Date, Developer may (a) sell, transfer, convey or assign interests in Developer, (b) admit additional or substitute members in Developer or any member or manager of Developer, or (c) change or transfer the ownership interests in any member or manager of Developer so long as there is no change in the existing ownership interests of the existing members of Plan B and Plan B shall at all times have a controlling interest in and be the managing member of Developer. Any other transfer shall require the prior written consent of City, which consent may be withheld by City in its sole and absolute discretion. City and Developer acknowledge and agree that Developer may grant SPI an interest in Developer pursuant to the SPI Contribution Agreement and may transfer ownership interests in Developer to third parties in the discretion of Developer after the Public Parking Easement Acceptance Date and recordation of the Public Parking Easement in the King County real property records. , 233 Definition of Transfer As used in Subsection 23 21 a "transfer" includes any sale, transfer, conveyance, assignment, mortgage, pledge or other disposition of any interest , in Developer or any member or manager of Developer, whether voluntary or involuntary, by operation of law or otherwise, including transfers to a trustee in bankruptcy, receiver or assignee for the benefit of creditors or any merger, consolidation, liquidation or dissolution of Developer or any member or manager of Developer. 23.4 No Transfer of Replacement Parking Site During Construction of Parking ' Garage. Developer shall not sell, transfer, lease, convey, encumber or enter into a contract of sale or other conveyance of all or any part of or any interest in the Parking Garage during the construction thereof and prior to Final Completion of the Parking Garage and the Public Parking -33- PQRSORS2UB 09/14/05 Easement Acceptance Date without the prior written consent of City, which consent may be withheld by City in its sole and absolute discretion City acknowledges that Developer reserves the right to sell at[ or any portion of Project Springboard, including, but not limited to, sales of residential condominiums to individual homeowners after the Public Parking Easement Acceptance Date. Developer may enter into "pre-sale" agreements with individual homeowners to purchase a condominium upon final completion thereof without the consent of City From and after the Public Parking Easement Acceptance Date, Developer shall have the right to sell the Parking Garage, subject to, and on the terms and conditions set forth in, the Public Parking Easement. 24. Events of Default Prior to Closing Date; Remedies. 24.1 City's Default In the event of a default by City of a material provision under the Agreement prior to the Closing Date, then provided Developer is not in default hereunder, Developer's sole and exclusive remedy shall be either (a) to seek and obtain specific performance of City's obligations hereunder, or (b) to terminate this Agreement upon written notice to City and Escrow Agent and except as otherwise expressly provided herein neither party hereto shall have any further rights, duties or obligations under this Agreement. 24.2 Developer's Default. In the event of a breach or default by Developer ' without any default by City or failure of any condition precedent to Closing hereunder prior to the Closing Date, City's sole and exclusive remedy shall be either (a) to seek and obtain specific performance of Developer's obligations hereunder, or (b) to terminate this Agreement by written notice to Developer and Escrow Agent whereupon all work product prepared by or on behalf of Developer for development of the Parking Garage shall immediately and without payment of additional consideration be assigned to City, Developer shall pay all title and escrow cancellation ' charges, if any, and except as otherwise expressly provided herein, neither party shall have any further rights, duties or obligations under this Agreement 25. Developer Events of Default Followmg Closing Date, Remedies 25.1 Developer Default. The following events shall constitute a "Default" or "Event of Default"by Developer: 25.1.1 If Developer shall fail to perform any material obligation under this Agreement; or 25.1.2 If Developer has abandoned construction of the Parking Garage for a period of twenty (20) consecutive days (except for Unavoidable Delay), or 25.1.3 If any permit required for construction of the Parking Garage shall be revoked or canceled, or 25.1 4 If Developer shall have assigned, pledged or encumbered its rights, duties or obligations under this Agreement in violation of this Agreement; or 25.1.5 If any representation or warranty made by Developer as set forth in Section 12 shall be untrue or breached in any material respect; or -34- PMRSORszus OW14105 25 1.6 If Developer has not commenced construction of the Parking Garage on or before March 31, 2006; or 25 1.7 If Substantial Completion of the Parking Garage has not occurred for any reason except for Unavoidable Delay, on or before September 30, 2006 (the Substantial Completion Date), or 25.1.8 If Substantial Completion of the Parking Garage has not occurred for any reason whatsoever including Unavoidable Delay on or before March 3 t. 2007 (the Outside Completion Date); or 25 1.9 If Developer files a petition for bankruptcy or if it makes a general assignment for the benefit of Developer's creditors, or if a receiver is appointed on account of Developer's insolvency and any such petition or appointment is not dismissed within ninety (90) days; or 25 1 10 There is an event of default under the City Mortgage which has not been cured prior to the expiration of any cure period contained therein. 25.2 City Remedies upon Developer Event of Default. Upon any Event of Default by Developer, City shall give Developer written notice of the same, whereupon Developer shall have thirty (30) days within which to commence all necessary action to cure any such Event of Default, (and if such cure is commenced, proceed to diligently complete such cure within a reasonable period of time not to exceed ninety (90) days), except with respect to Events of Default set forth in Section 25 1.4, 25 1 6, 25.1.71 25.1 8, 25.1.9 or 25 10 for which no cure period exists beyond the time period stated therein. In the event Developer falls to cure such Event of Default within the time period set forth above, City may (a) terminate this Agreement upon ten (10) days prior written notice to Developer; (b) bring an action for damages; (c) seek specific performance of this Agreement; (d) take over and complete the work of construction of the Parking Garage, including the right to enforce contracts or agreements theretofore made by or on behalf of the Developer and to do any and all things necessary or proper to complete the work of construction, as may be deemed reasonably necessary and to recover the cost thereof, together with interest thereon at the rate of twelve percent (12%) per annum, or (e) foreclose the City Mortgage. 26. City Events of Default Following Closing Date; Remedies. If City fails to perform any material obligation under this Agreement after Closing but prior to the Public Parking Easement Acceptance Date, Developer shall give City written notice of same, whereupon following receipt of such written notice, City shall have thirty (30) days within which to commence all necessary action to cure any such failure (and if cure is commenced with such thirty (30) day period, proceed to diligently complete such cure within a reasonable period of rime). In the event City fails to cure such failure within the time period set forth above and provided Developer is not in default hereunder, then Developer's sole and exclusive remedy shall be the right to seek and obtain specific performance of City's obligations hereunder. 27. Rights and Remedies Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise or failure to -35- PMRSTRS2US 09/14/05 exercise one or more of such rights or remedies by either party shall not preclude the exercise by it, at the same time or different times, of any right or remedy for the same default or any other default by the other party Consequential damages and damages which are speculative or remote are not recoverable under this Agreement even if such damages would otherwise be available under law or equity 28. Notices. Unless applicable law requires a different method of giving notice, any and all notices, demands or other communications required or desired to be given hereunder by any party (collectively, "Notices") shall be in writing and shall be validly given or made to the other party if delivered either personally, or by overnight delivery service of recognized standing, or by United States Mail, certified, registered, or express mail with postage prepaid, or by facsimile transmission with electronic confirmation of receipt If such Notice is personally delivered or delivered by facsimile during normal business hours, it shall be conclusively deemed given at the time of such delivery. If such Notice is delivered by facsimile after normal business hours or is delivered by overnight delivery service, it shall be deemed given one (1) business day after receipt thereof(if sent by facsimile transmission) or one (1) business day after the deposit thereof with such delivery service If such Notice is mailed as provided herein, notice shall be deemed given three (3) business days after the deposit thereof in the United States Mail. Each such Notice shall be deemed given only if properly addressed to the party to whom such Notice is to be given as follows To City: City of Kent 220 Fourth Avenue Kent, Washington 98030 Attn. City Clerk Fax. (253) 856-6725 With a copy to: City of Kent 220 Fourth Avenue Kent, Washington 98030 Attn: City Attorney Fax. (253) 856-6770 To Developer: Springboard Holdings, L.L.C. 1627 East Sammarmsh Place SE Sammamish, Washington 98075 Attn Ben Errez Fax- (425) 369-9949 With a copy to- Plan B Development, L.L.C. 12889 Casino Drive Anacortes, Washington 98221 Fax. (425) 936-7329 -36- P ORSORKUB 09114105 With a copy to: Chairman, Swmomish Indian Tribal Community P.O Box 817 LaConner, Washington 98257 ' Fax: (360) 466-5309 To Second Avenue. Second Avenue Real Estate LLC 1301 Fifth Avenue, Suite 2600 Seattle, Washington 98101 Attn- Ben Porter Fax: (206) 587-0579 Any party hereto may change its address for the purpose of receiving Notices as herein provided , by a written notice given in the manner aforesaid to the other parties hereto. 29. Survival of Representations and Warranties. Except as otherwise expressly , provided herein, all representations, warranties, covenants and agreements of the parties contained in this Agreement, or in any instrument or other writing provided for herein, shall survive the Closing. 30. Brokerage Fees. Each party represents to the other that no broker has been involved in this transaction In the event of a claim for any broker's fee, finder's fee, commission or other similar compensation in connection herewith Developer, if such claim is based upon any agreement alleged to have been made by Developer, hereby agrees to indemnify City and Second Avenue against and hold City and Second Avenue harmless from any and all damages, liabilities, costs, expenses and losses (including, without limitation, reasonable attorneys' fees and costs) which City or Second Avenue may sustain or incur by reason of such claim. In the event of a claim for any broker's fee, finder's fee, commission or other similar compensation in connection herewith Second Avenue, if such claim is based upon any agreement alleged to have been made by Second Avenue, hereby agrees to indemnify City and Developer against and hold City and Developer harmless from any and all damages, liabilities, costs, expenses and losses (including, without limitation, reasonable attorneys' fees and costs) which City or Developer may sustain or incur by reason of such claim City, if such claim is based upon any agreement alleged to have been made by City, hereby agrees to indemnify Developer and Second Avenue against and hold Developer and Second Avenue harmless from any and all damages, liabilities, costs, expenses and losses including, without limitation reasonable attorneys' fees and costs) which Developer or Second Avenue may sustain or incur by reason of such claim The indemnification provisions set forth herein shall survive Closing or termination of this Agreement. 31. Miscellaneous. 31.1 Burden and Benefit. The covenants and agreements contained herein shall , be binding upon and inure to the benefit of the successors and permitted assigns of the respective parties hereto Developer agrees that City may transfer its rights under this Agreement (including its rights under the Public Parking Easement) whether voluntarily, involuntarily, by operation of law or otherwise, to any city, county, governmental subdivision or agency or other municipal corporation -37- P\DRS\DRS2UB 09/14/06 31.2 No Continuing Waiver. Any waiver by either of the parties of any breach of any covenant herein contained to be kept and performed by the other party shall not be deemed or considered as a continuing waiver, and shall not operate to bar or prevent the damaged party from declaring a forfeiture for any succeeding breach, either of the same condition or covenant or otherwise. 31 3 Nondiscrimination Developer will not discriminate and shall ensure that its consultants and all contractors engaged by Developer in connection with Project Springboard comply with all applicable federal, state and local discrimination laws, rules and regulations 31.4 Neutral Authorship. In connection with the execution and delivery hereof, each party has been represented by counsel Each of the provisions of this Agreement has been reviewed and negotiated, and represents the combined work product of the parties hereto No presumption or other rules of construction which would interpret the provisions of this Agreement in favor of or against the party preparing the same shall be applicable in connection with the construction or interpretation of any of the provisions of this Agreement. I 31 5 Terminology. All personal pronouns used in this Agreement, whether used in the masculine, feminine and neuter gender, shall include all other genders, the singular shall include the plural, and vice versa as the context may require. 31.6 Complete Agreement, Amendment This Agreement together with the exhibits annexed hereto or referred to herein is intended to be the entire agreement of the parties with regard to the subject matter hereof and may only be amended with the written consent of all parties 31.7 Severability. Each provision of this Agreement shall be considered severable, and if for any reason any provision that is not essential to the effectuation of the basic purposes of the Agreement is determined to be invalid and contrary to any existing or future law, such invalidity shall not impair the operation of or affect those provisions of this Agreement that are valid. 31.8 Relationship of Parties Developer, Second Avenue and City shall not be construed as joint venturers or general partners, and no party shall have the power to bind or obligate any other party except as set forth in this Agreement Neither Developer nor Second Avenue shall have any right or authority, express or implied, to commit or otherwise obligate City in any manner whatever except to the extent specifically provided herein or specifically authorized in writing by City City shall have no right or authority, express or implied, to ' commit or otherwise obligate Developer or Second Avenue in any manner whatever except to the extent specifically provided herein or specifically authorized in writing by Developer or Second Avenue. ' 31.9 No Third Party Rights. The provisions of this Agreement are intended solely for the benefit of, and may only be enforced by, the parties hereto and their respective ' successors and permitted assigns None of the rights or obligations of the parties herein set forth (or implied) is intended to confer any claim, cause of action, remedy, defense, legal justification, indemnity, contribution claim, set-off, or other right, whatsoever upon or otherwise inure to the 1 -38- P ORSORMB 091141105 benefit of any contractor, architect, consultant, subcontractor, worker, supplier, mechanic, architect, insurer, surety, guest, condominium owner, tenant, member of the public, or other third parties having dealings with any of the parties hereto or involved, in any manner, in the Property. 31.10 Non Waiver of Governmental Rights. Nothing contained in this Agreement shall require City to take any discretionary action relating to development of the improvements to be constructed on the Property as part of Project Springboard, including, but not limited to, zoning and land use decisions, permitting, design review or any other governmental approvals. ' 31.11 Captions. The captions of this Agreement are for convenience and reference only and in no way define, limit or describe the scope or intent of this Agreement 31.12 Counterparts. This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all such counterparts together shall constitute but one agreement. 31.13 Further Assurance. Each party hereto agrees that it will execute or furnish such documents and further assurances to the other or to proper authorities as may be necessary for the full implementation and consummation of this Agreement and the transactions contemplated hereby. ' 31.14 Authori . Each of the persons signing below represent and warrant that they have the requisite authority to bind the party on whose behalf they are signing ' 31.15 Time Is of the Essence. Time is of the essence of this Agreement. All periods of time referred to herein shall, unless otherwise expressly provided herein, include Saturdays, Sundays and legal holidays in the State of Washington, except that if the last day of any period falls on any Saturday, Sunday or such holiday, the period shall be extended to the next business day. 31.16 Memorandum of Agreement. The Agreement shall not be recorded; however, upon the request of either party, the parties shall record a Memorandum of this Agreement in a form mutually acceptable to both parties in the real property records of King County, Washington. 31.17 Attorneys' Fees Each party shall be responsible for payment of the legal , fees of its counsel in the event of any litigation, mediation, arbitration or other proceeding brought to enforce or interpret or otherwise arising out of this Agreement 31.18 WAIVER OF JURY TRIAL. CITY, DEVELOPER AND SECOND AVENUE HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM ARISING ' OUT OF THIS AGREEMENT, WHETHER NOW OR HEREAFTER ARISING AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE AND HEREBY CONSENT AND AGREE THAT ANY SUCH CLAIM SHALL BE DECIDED BY TRIAL ' WITHOUT A JURY. ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE WAIVER AND AGREEMENT CONTAINED HEREIN. ' -39- P%DRS%DRS2UB 09/14/05 ' 31.19 Exhibits The exhibits referred to herein or attached hereto are made a part of and incorporated into this Agreement All exhibits not finalized as of the date of this Agreement shall be finalized and agreed to by the parties prior to the expiration of the Due Diligence Period and shall thereafter become part of and incorporated into this Agreement. 31.20 Conflicts of Interests. No member, official or employee of City shall make any decision relating to the Agreement which affects his or her personal interests or the interests of any corporation, partnership or association in which he or she is directly or indirectly interested. 31.21 Non-Liability of City Officials Employees, and Agents. No member, ' official, employee or agent of City shall be personally liable to Developer, or any successor in interest, ul the event of any default or breach by City or for any amount which may become due to Developer or such successor or on any obligation under the terms of this Agreement. 1 31.22 Applicable Law. This Agreement shall be construed and enforced in accordance with the laws of the State of Washington, without regard to principles of conflicts of ' laws, and venue of any action brought to enforce this Agreement shall he exclusively in King -40- P1DRS1DRS2UB 09/14/05 County Superior Court. The parties hereto consent to the jurisdiction of the King County Superior Court and waive the right to file suit elsewhere. IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the date first above written DEVELOPER: CITY: , SPRINGBOARD HOLDINGS, L L.0, CITY OF KENT, a Washington municipal a Washington limited liability company corporation By. By: ' Name: Name- Title: Title. SECOND AVENUE APPROVED AS TO FORM Second Avenue Real Estate LLC, a Washington limited liability company CITY ATTORNEY By. Name: Title: -41- PiDRSORMB 09/14105 Exhibits ' A-I Legal Description for City-Owned Town Square Plaza Site A-2 Legal Description for City-Owned Replacement Parking Site A-3 Legal Description for Harrison Exchange Property B Legal Description for Private Land B-1 Legal Description for Harrison Property B-2 Legal Description for SPI Land C-1 Legal Description for Property (A-2 and B-2) C-2 Legal Description for Harrison Exchange Property D Preliminary Site Plan for Project Springboard Improvements E Parking Garage Design Standards F Public Parking Easement ' G City Mortgage H City Deed I Definitions I -42- P0R$\DR52UB 09/14105 Exhibit A-1 Legal Description for City-Owned Town Square Plaza Site ' [To be provided by Title Company and surveyor and agreed to by parties.] A-1-1 P1DRSORS2UB 09/14105 ' Exhibit A-2 ' Legal Description for City-Owned Replacement Parking Site [To be provided by Title Company and surveyor and agreed to by parties ] A-2-1 P1DRSVDR52US 09V14105 Exhibit A-3 Leal Description for Harrison Exchange Property , [To be provided by Title Company and surveyor and agreed to by parties.] A-3-1 PTRSMRS2UB 09114/05 1 Exhibit B 1 Legal Description for Private Land [To be provided by Title Company and surveyor and agreed to by parties.] 1 1 i i 1 1 i i 1 1 i 1 1 1 B-1 PMRSORS2UB 09/14/05 r Exhibit B-1 1 Legal Description for Harrison Property 1 [To be provided by Title Company and surveyor and agreed to by parties.] 1 1 1 1 1 1 , . i i i i i 1 1 1 1 B-1-1 P1DRSURS2UB 09/14/05 , Exhibit B-2 Legal Description for SPI Land (following completion of boundarxline adjustment and alley vacation) ' [To be provided by Title Company and surveyor and agreed to by parties ] t B-2-1 P%DRS\DRS2UB 09/14/05 Exhibit C-1 ' Legal Description for Property ' (SPI Land plus City-Owned Replacement Parking Site) [To be provided by Title Company and surveyor and agreed to by parties ] ' 1 C-1-1 PORS1DRS2UB 09/14105 Exhibit C-2 Legal Description for Harrison Exchange Property [To be provided by Title Company and surveyor and agreed to by parties.] ' C-2-1 P ORSORSWO 09/14/05 Exhibit D Preliminary Site Plan for Project Springboard Improvements [To be provided by Developer; same as Exhibit D to the Pooling Agreement] Ij D-1 PORSORMS MUMS ' Exhibit E Parkin2 Garage Design Standards 1. Garage Design. Signage and Graphics. The Parking Garage shall be designed to ensure simple ingress and egress by members of the general public to the Parking Garage, and directional signage at appropriate locations on the Property, indicating the location of vehicular and pedestrian entrances and exists to the Parking Garage and traffic circulation within the Parking Garage. To help the customer remember the parking locations, signs designating the floor level and the alphabetical or numerical designation of the aisle shall be displayed throughout the parking area of the Parking Garage and adjacent to elevators and other entrances to the Parking Garage. Signage and graphics shall be designed to achieve a superior level of visibility, legibility and user-friendliness. The design of the Parking Garage (including signage and graphics) shall be in accordance with the Parking Garage Construction Documents prepared and approved in accordance with this Agreement Such plans shall incorporate the immediately following elements. 2. Garage Illumination: Adequate lighting is one of the most important safety features of the Parking Garage, and a strong maintenance program is necessary to preserve the lighting levels in the Parking Garage. Lighting for the Parking Garage shall be provided by fixtures with area controls on a seven-day program, sufficient to provide the following light intensity twenty-four (24) hours a day- (a) Traffic Lanes — a minimum maintained intensity approved by the parties as part of the Parking Garage Construction Documents measured thirty (30) inches above finished floor with a uniformity ratio of three to one (3.1) average to minimum; (b) Parking Stalls—a minimum maintained intensity approved by the parties as part of their approval of the Parking Garage Construction Documents measured thirty (30) inches above finished floor with a uniformity ratio of three to one (3:1) average to minimum, (c) Vehicular Entrances — a minimum maintained intensity of thirty (30) foot candles measured thirty (30) inches above finished floor with a uniformity ratio of three to one (3.1) average to minimum and (d) Stairways open to the public, Vestibules, Corridors and Lobbies — a minimum maintained intensity of twenty-five (25) foot candles measured thirty (30) inches above finished floor with a uniformity ratio of three to one (3 1) average to minimum. The ceilings shall be painted white and all vertical surfaces of the Parking Garage shall be painted white, where practicable 3. Parking Spaces and Module- Parking shall be available for a minimum of three hundred fifty (350) multi-passenger motor vehicles. There shall be additional parking spaces provided for motorcycles and bicycles One (1) additional foot for stall width shall be required for parking stalls adjacent to columns. In addition, before issuance of a building permit for the Parking Garage the City shall approve a vehicle maneuvering diagram as submitted by the Developer that shows adequate vehicle maneuvering for parking stalls throughout the garage. 4. Stall Striping: Stalls shall be separated by single four (4) inch paint or therma-plastic stripe. E-1 PQRS%DRS2U0 MUM 5. Security Devices. The plans for the Parking Garage shall specify the security devices to be installed, which may including closed circuit TN momtors and cameras, assistance call boxes installed on each level at elevators and other critical locations, audio monitoring devices and their locations. 6. Ventilation. The Parking Garage design shall be designed to include a separate ventilation system for the Parking Garage which shall vent automobile exhaust fumes to the outside and ensure that unsafe levels of carbon monoxide, noxious fumes and other pollutants do not remain in the Parking Garage or enter the Project Springboard Improvements. E-2 V1DRSORS2UB 09/14/05 Exhibit F Public Parking Easement RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: City of Kent 220 Fourth Avenue Kent, Washington 98030 Attn: City Attorney PUBLIC PARKING EASEMENT GRANTORS: 1. Springboard Holdings, L.L.C., a Washington limited liability company 2. Second Avenue Real Estate LLC, a Washington limited liability company GRANTEE: City of Kent, a Washington municipal corporation Legal Description- Abbreviated form: Additional legal on page Exhibit A Assessor's Property Tax Parcel ID No(s).: F-l P10RSIORS2US 09114/05 PUBLIC PARKING EASEMENT THIS PUBLIC PARKING EASEMENT (the "Easement Agreement") is executed this day of 2006 by SPRINGBOARD HOLDINGS, L.L C., a Washington limited liability company ("Developer") and SECOND AVENUE REAL ESTATE LLC, a Washington limited liability company ("Second Avenue") in favor of CITY OF KENT, a Washington municipal corporation, its successors and assigns ("City") with reference to the following facts: RECITALS A. Pursuant to the terms and conditions set forth in that certain Replacement Parking Agreement dated as of September 30, 2005 by and between City and Developer (the "Replacement Parking Agreement"), City agreed to transfer certain real property more particularly described therein as the Replacement Parking Site on the express condition that the Developer redevelop certain real property located in the City of Kent and generally bordered on the north by Smith Street, on the west by Fourth Avenue, on the south by Harrison Street (excluding certain real property owned by Meeker Street Law Building LLC and MBA Harrison Square 1 LLC and MBA Harrison Square 11 LLC, each a Washington limited liability company) and on the east by Second Avenue and more particularly described in the Replacement Parking Agreement as the "Property" or the "Project Site", with a privately owned mixed-use condominium development as more particularly described in the Replacement Parking Agreement (collectively, "Project Springboard"). B. Pursuant to the terms and conditions set forth in the Replacement Parking Agreement, including, but not limited to, the design standards set forth in Exhibit E thereto, Developer agreed to design, develop and construct a parking garage consisting of four (4) levels of above-grade parking containing a minimum of three hundred fifty (350) parking spaces for multi-passenger motor vehicles (the "Parking Garage"), to grant City, any successor public entity and members of the general public a perpetual easement to park in the Parking Garage twenty four (24) hours a day, seven (7) days a week, initially at no charge, and to thereafter operate and maintain the Parking Garage as a self—park public parking garage and in a manner to maximize the availability of Short Term Parking (as hereinafter defined), on the terms and conditions set forth herein. C. Developer has achieved Final Completion of the Parking Garage (as defined in the Replacement Parking Agreement) and all other conditions precedent to City's acceptance of the public parking easement have been met to the satisfaction of City. NOW, THEREFORE, in consideration of the foregoing recitals, the terms and conditions set forth in the Replacement Parking Agreement and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows. F-2 P ORSORS2US 09/14405 AGREEMENT 1. Recitals incorporated Definitions Each of the recitals set forth above is incorporated into this Easement Agreement as though fully set forth herein All capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Replacement Parking Agreement or on Exhibit E to this Easement Agreement Developer, in its capacity as owner of the Parking Garage, and its successors and assigns, is also referred to in this Easement Agreement as the Parking Garage Owner 2. Grant of Public Parking Easement. Developer hereby grants and establishes for the benefit of City, any successor public entity, and members of the general public, a perpetual easement to park in the Parking Garage located on the real property more particularly described in Exhibit A attached hereto and by this reference incorporated herein (the "Property") twenty four (24) hours a day, seven (7) days a week, initially at no charge, together with rights of pedestrian and vehicular access to and from the Parking Garage and the public streets adjoining the Property utilizing the existing private road as outlined in red on the map annexed hereto as Exhibit B. (a) Exclusive Public Parking Stalls. Not less than seventy (70) parking stalls in the Parking Garage located on the first and second levels of the Parking Garage shall be available to members of the general public for Short Term Parking at all times (collectively, the "Exclusive Public Parking Stalls"). The location of the Exclusive Public Parking Stalls is set forth on the map annexed hereto as Exhibit B and by this reference incorporated herein and shall not be changed without the prior written consent of City. (b) Shared Parking Stalls, Public Right to Use Shared Parkin Stalls. tads. The remaining parking stalls on level two, and all of the parking stalls on levels three and four of the Parking Garage are intended to be used for Short Term Parking by Project Springboard condominium owners, hotel guests, tenants of Project Springboard Improvements and their customers and tenants of property owned by Second Avenue south of Harrison Street (the "Second Avenue Project Improvements") and their customers on an unreserved, first come, first serve basis Members of the general public shall also have the right to park in any open parking stall located on the remainder of level two and all of levels three and four on a first-come, first serve basis, twenty four (24) a day, seven (7) days a week (collectively, the "Shared Parking Stalls"). The location of the Shared Parking Stalls is set forth on the map annexed hereto as Exhibit B and by this reference incorporated herein and shall not be changed without the prior written consent of City No parking stalls will be allocated to a particular condominium unit, hotel guest, commercial tenant or any of their employees, invitees or customers. (c) Short Term Parking For purposes of this Easement Agreement, Short Term Parking means use of a parking stall by the same motor vehicle for up to three (3) hours or less during any twenty four (24) hour period (excluding the hours between midnight and 6 00 a.m.). The City shall have the right to revise the definition of Short Term Parking as it applies to the Parking Garage from time to time The City shall F-3 P1DRS1DRS2US W14M periodically, but not more often than quarterly, review the use of the Parking Garage and following consultation with the Parking Management Committee established pursuant to Section to of this Easement Agreement("Committee"), revise the definition of Short Term Parking to maximize utilization of parking stalls in the Parking Garage by members of the general public and hotel guests, condominium owners, Project Springboard and Second Avenue Project Improvements tenants and their customers, while limiting use of the Parking Garage by commuters and employees of organizations located in downtown Kent (d) Special Use Parking Stalls. The Parking Garage Owner may issue special use parking permits to the owner of the Project Springboard Improvements in an amount equal to the number of hotel rooms and number of bedrooms in all condominium units built as part of the Project Springboard Improvements for use solely by Project Springboard condominium owners and hotel guests. Second Avenue shall be entitled to at least seventy (70) special use permits for use solely by Second Avenue Project tenants, with the total number of special use permits issued to Second Avenue based upon Second Avenue's contribution toward the cost of the Parking Garage. A special use permit shall entitle such permit holder the right to park in the Shared Parking Stalls for periods longer than the then applicable Short Term Parking limit established by the City, on a first come, first serve bans. The Parking Garage Owner shall have the right to issue such special use parking permits in the exercise of its business judgment and subject to such conditions and limitations as it may determine from time to time and may charge for issuance of a special use permit, provided, however, the Parking Garage Owner shall not issue more than one special use parking permit per sold or leased condominium unit or occupied hotel room and shall not issue Second Avenue more than one special use permit for each parking stall purchased without the prior written consent of the City Upon request by any party to this Easement Agreement from time to time, the parties shall confirm the total number of special use permits that can be outstanding at any one time Special use permits are not transferable and must be surrendered by the permit holder if the permit holder no longer satisfies the requirements for a special use permit set forth in this Easement Agreement and such additional qualifications as Developer or Second Avenue may establish from time to time. Parking Garage Owner and Second Avenue shall each maintain records regarding the number of special use permits issued at any time including the name, address and status of the special use permit holder (i.e., hotel guest, condominium unit owner or tenant), date of issuance, motor vehicle license number and such other information as City or the Committee may reasonably request The holders of special use parking permits may not park in the Exclusive Public Parking Stalls at any time except with the prior written consent of the City. (e) Handicapped Parking Stalls. Notwithstanding the foregoing and provided that there is no reduction in the number of Exclusive Parking Stalls available for use by members of the general public, Parking Garage Owner may reserve parking spaces on each level of the Parking Garage for use by persons with a valid disability parking permit or license plate. The handicapped parking stalls shall be evenly distributed F-Y P ORSORMB 09/14/05 throughout the Parking Garage. Only persons with a valid disability parking permit or license plate may park in a parking stall designated as handicapped parking. (f) Uninterrupted Access to Parking Garage. Members of the general public shall have free, open and continuous pedestrian and vehicular access to and from the Parking Garage, the entrances and exits thereto and the sidewalks, streets and public rights of way adjoining the Property, using existing elevators, stairs, skybridges, roadways, driveways and sidewalks now or hereafter located on the Property, including but not limited to the private street connecting Smith and Harrison Streets, at all times (subject to the Parking Garage Owner's right to control pedestrian ingress and egress to the Parking Garage after certain hours to protect the safety and security of patrons of the Parking Garage). With the exception of the Exclusive Public Parking Stalls which shall be reserved for Short Term Parking by members of the general public at all times, parking spaces in the Parking Garage will be provided on an unreserved, first come, first served basis Persons utilizing the Parking Garage shall not be entitled to use any one particular parking space and may not use more than one parking space at any one time for the parking of a single vehicle Members of the general public shall also have the right to use the restrooms located adjacent to the spa constructed as part of Project Springboard at no charge. 3. Operation of the Parking Garage. (a) Public Parking Garage Parking Garage Owner shall at its sole cost and expense, provide for the safe and efficient operation of the Parking Garage as a self- park, public parking garage which can park at least three hundred fifty (350) multi- passenger motor vehicles and which is open to members of the general public for public parking twenty four (24) hours a day, seven (7) days a week in accordance with the terms and conditions set forth in this Easement Agreement Parking Garage Owner shall pay all Operating Expenses (as defined in Exhibit C) incurred in connection therewith The Parking Garage shall be operated and managed to maximize the availability of Short Term Parking at all times in accordance with the provisions of this Easement Agreement (b) Compliance with All Laws Parking Garage Owner shall at its sole cost and expense, operate the Parking Garage (and entrances, exits, elevators, stairs, skybridges, sidewalks, driveways and roadways providing pedestrian and vehicular access to the public and private streets adjoining the Property including, but not limited to the private street that will connect Smith and Harrison Streets) in compliance with all Requirements of Law, and in the event any use or operation of the Parking Garage shall constitute a violation of any Requirements of Law, promptly following knowledge of such violation take all steps reasonably necessary to remedy same Parking Garage Owner shall secure at its sole cost and expense, all permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with the operation of the Parking Garage or the making of repairs or replacements to the Parking Garage or equipment thereon. F-5 P\DRS\DRS2UB 09/14/05 (c) SiSi Tgnag_e. Parking Garage Owner and City shall mutually agree on the designation and signage in the Parking Garage and elsewhere on the Project Springboard Improvements including designated entrances and exits to the Parking Garage and the Project Springboard Improvements which are adequate to inform members of the public of the location and means of access through the Project Springboard Improvements to and from the Parking Garage, the location of the Exclusive Public Parking Stalls, the then applicable time limitation on the use of the Exclusive Public Parking Stalls, the location of Shared Parking Stalls, and the roadways, sidewalks and streets adjoining the Property. The final design and choice of materials for such signs shall be subject to City's approval, which approval shall not be unreasonably withheld, conditioned or delayed (d) Parking Garage Rules. Following consultation with the Committee, the Parking Garage Owner may adopt, modify and enforce reasonable rules (the "Parking Garage Rules") governing the use of the Parking Garage so long as such rules do not restrict access to or from the Parking Garage by members of the general public parking in the Parking Garage and are not inconsistent with the terms of this Easement Agreement. The Parking Garage Rules currently in effect are attached hereto as Exhibit D and by this reference incorporated herein. City acknowledges that Parking Garage Owner may refuse to permit any person who violates the Parking Garage Rules to park in the Parking Garage and any serious or repeated violation of the current Parking Garage Rules may result in the removal of the motor vehicle belonging to such a person from the Parking Garage. Parking Garage Owner shall post copies of the Parking Garage Rules in the various entrances and exits to the Parking Garage and shall make copies of the Parking Garage Rules available to the City and all Project Springboard condominium owners, tenants, hotel guests, and their respective tenants, subtenants, invitees and customers who use the Parking Garage, upon any change or modification thereof. (e) Prohibited Uses. (i) The layout, type and number of parking stalls and the configuration of the parking spaces shall not be changed without the prior written consent of the City The lighting, graphics, signage, structural support characteristics and locations of exits and entrances to the Parking Garage shall not be materially changed from the as- built plans and specifications for the Parking Garage without the prior written approval of City. (ii) Parking Garage Owner shall not do or permit anything to be done in or about the Parking Garage nor bring or keep anything therein which will cause a cancellation of any insurance policy covering the Parking Garage, nor shall Parking Garage Owner sell or permit to be kept, used or sold in or about the Parking Garage any articles which may be prohibited by the terms of the property insurance required to be carried by the Parking Garage Owner pursuant to the provisions of Section 6 of this Easement Agreement. F-6 P\DR51DR52UB 0W14105 (iii) Parking Garage Owner shall not close any entrance or exit to the Parking Garage that provides pedestrian or vehicular access to or from the Parking Garage, or do or authorize anything to be done in or about Project Springboard or the Parking Garage which will in any way obstruct or interfere with the rights of members of the public to enter or exit the Parking Garage from the roadways, sidewalks and streets adjoining the Property, including, but not limited to the right to use the private street connecting Smith and Harrison Street to enter and exit the Parkmg Garage Notwithstanding the foregoing, Parking Garage Owner shall have the right to close portions of the Parking Garage in order to make necessary repairs or maintenance, which repairs and maintenance shall be performed in accordance with the requirements of Section 5 of this Easement Agreement, and, following consultation with the Committee, may control pedestrian ingress and egress to the Parking Garage after certain hours to protect the safety and security of patrons of the Parking Garage. (iv) Parking Garage Owner shall not permit the Parking Garage to be used for any use other than as a self park, public parking garage, or be used for any unlawful or objectionable purpose, nor shall the Parking Garage Owner cause, maintain or permit any nuisance in, on or about the Parking Garage. Parking Garage Owner shall not commit or suffer to be committed any waste in or upon the Parking Garage. (v) Parking Garage Owner shall not install or permit the installation of any underground storage tanks in the Parking Garage, allow any person to sell or dispense gasoline, diesel fuel or other petroleum products from fuel tanks located in the Parking Garage, sell motor oil. nor allow any person to provide automobile repair services (other than emergency repairs) in the Parking Garage (vi) So as not to interfere with traffic flow to and from the Parking Garage and within the various levels of the Parking Garage there shall be no sales conducted within the Parking Garage without the prior written consent of City and no kiosks, pushcarts or other merchandising units or obstructions shall be placed in the Parking Garage or near the entrances or exits thereto without the prior written consent of the City (vii) Parking Garage Owner shall not use the Parking Garage or permit anything to be done in or about the Parking Garage which will in any way conflict with any law, statute, ordinance or governmental rule or regulation or requirement of duly constituted public authorities now in force or which may hereafter be enacted or promulgated. (vii) Parking Garage Owner shall operate and maintain or cause the Parking Garage to be operated and maintained so that levels of carbon monoxide, noxious fumes and other pollutants in the Parking Garage do not exceed levels in excess of that established under applicable Environmental or other laws. F-7 P MWORS2US M14i% (ix) With the exception of the Exclusive Public Parking Stalls, parking stalls reserved for use by persons with a valid disability parking permit or license and special use parking permit holders, Parking Garage Owner shall not enter into daily or monthly parking permits, written or oral agreements or other contracts granting any person a right to park in the Parking Garage. (f) Parking Management Plan. Parking Garage Owner shall supervise the daily operation of the Parking Garage and shall, in consultation with the Committee, develop and thereafter enforce a parking management plan to ensure that the Exclusive Parking Stalls are used solely for Short Term Parking by members of the general public at all times and that the remainder of the parking stalls in the Parking Garage are utilized in the manner set forth in Section 2 of this Easement Agreement Parking Garage Owner shall maintain records of the operation of the Parking Garage and utilization of the Exclusive Parking Stalls and the Shared Parking Stalls, and shall provide periodic written reports to the Committee regarding same. Parking Garage Owner shall monitor the daily use of the Parking Garage and shall take such measures as may be reasonably necessary given the utilization of the Parking Garage, to enforce the limitations on use of the parking stalls set forth in Section 2 of this Easement Agreement Such measures may include, in addition to signage notifying patrons of the Parking Garage that the Exclusive Public Parking Stalls are reserved at all times for use by members of the general public and the current Short Term Parking limit for parking in the Parking Garage, issuance of warning notices, use of security patrols, observation, or other means necessary to monitor parking compliance. The Parking Garage Owner shall in consultation with the Committee establish, assess and collect penalties from persons who exceed the then applicable Short Term Parking limit and do not have a valid special use permit Unauthorized vehicles remaining in any parking stall for more than the then applicable Short Term Parking limit may be removed by the Parking Garage Owner at the vehicle owner's expense if the vehicle in question has received more than three (3) ticketed warnings during any thirty (30) day period, and shall be removed from the Exclusive Parking Stalls by the Parking Garage Owner at the vehicle owner's expense if requested by the City 4. Parking Charges Parking Garage Owner shall not charge for the right to park in the Parking Garage until such time as the City charges for parking on any of its streets, or City-owned surface parking lots or parking structures located within the Kent Station Planned Action Ordinance Area Parking Garage Owner acknowledges that City would not have entered into the Replacement Parking Agreement or agreed to accept this Easement Agreement in exchange for the City Replacement Property but for the agreement by Developer and its successors and assigns as owners of the Parking Garage to not charge for parking in the Parking Garage until such time as the City charges for parking on any City streets located within the Kent Station Planned Action Ordinance Area, or City-owned surface parking lots or parking structures located within the Kent Station Planned Action Ordinance Area Each party to this Easement Agreement agrees that this provision was specifically negotiated by the parties, is a material inducement to the City to enter into this Easement Agreement and that any breach por attempted breach of the terms of this F-O PSDRS%DRS203 09MV05 Section 4 by the Parking Garage Owner would cause irreversible and substantial damages to the City that would be extremely difficult or impracticable to determine. Accordingly, City shall be entitled to seek an injunction or other equitable relief from a court of competent jurisdiction to enjoin a breach of the provisions of this Section 4 5. Maintenance of Parking Garage. (a) Maintenance Requirements. Parking Garage Owner shall, at its sole cost and expense, maintain the Parking Garage (and entrances, exits, elevators, stairs, skybridges, sidewalks, driveways and roadways providing pedestrian and vehicular access to the public and private streets adjoining the Property including, but not limited to the private street that connects Smith and Harrison Streets) in first class order, condition, appearance and wear, in accordance with standards prevailing in first class mixed-use developments including multilevel structured parking garages and the multilevel structured parking garage owned, operated and maintained by the Central Puget Sound Regional Transit Authority in connection with its Kent commuter rail station. The Parking Garage Owner shall prepare and submit to the Committee for its review and approval an annual operating budget and detailed operating agreement for the Parking Garage which shall comply with all Requirements of Law and this Easement Agreement. The initial operating agreement for the Parking Garage shall be agreed to by the Developer, the City and Second Avenue prior to November 15, 2005 As part of such maintenance obligation, Parking Garage Owner shall take all action and shall perform all interior and exterior, structural and non-structural, foreseen and unforeseen, ordinary and extraordinary, maintenance and repairs (including, without limitation, all necessary repair, replacements and other work 1 required following any damage, destruction or condemnation of the Parking Garage) or any work required under Requirements of Law, as a condition to the continued use of the Parking Garage for parking purposes or any work required by any order of any court or other governmental agency with jurisdiction over the Parking Garage required to keep the Parking Garage (and entrances, exits, elevators, stairs, skybridges, sidewalks, driveways and roadways providing pedestrian and vehicular access to the public and private streets adjoining the Property, including, but not limited to the private street that connects Smith and Harrison Streets) in first class order, condition and repair. All repairs, replacements and renewals shall be substantially equal or superior in quality and class to the original construction work It is expressly agreed that City shall not be required to maintain, repair or rebuild all or any part of the Parking Garage and shall have no obligation to maintain all of any part of the Parking Garage (b) City Maintenance Notices. City shall provide the Parking Garage Owner written notice of any maintenance or repair required to the Parking Garage (or any entrance, exit, elevator, stair, skybridge, sidewalk, driveway or roadway providing pedestrian and vehicular access to the public and private streets adjoining the Property, including, but not limited to the private street that connects Smith and Harrison Streets) or of any default by Parking Garage Owner in the performance of its obligations under this Section 5 Parking Garage Owner shall have five (5) business days after receipt of notice F-9 P%DR51DRMS 0911005 mediator for resolution pursuant to the independent dispute mediation process set forth in subsection (f) below. (f) Mediation of Disputes. City and Parking Garage Owner agree to follow the independent dispute mediation process set forth in this Section 5(f) to attempt to resolve disputes regarding the proposed Maintenance Work Plan or Corrective Work Plan in an economic and time efficient manner and without resort to litigation so that the proposed Maintenance Work Plan or Corrective Work Plan (collectively, "Work Plans") conforms to the requirements of this Easement Agreement and any maintenance work or repairs made to the Parking Garage (including all entrances, exits, elevators, stairs, skybndges, sidewalks, driveways and roadways providing pedestrian and vehicular access to the public and private streets adjoining the Property) are made in an cost-efficient, appropriate and timely manner. In the event a dispute arises between City and Parking Garage Owner regarding the proposed Work Plans, either party may, by delivering written notice to the other, refer the matter to an independent construction professional with experience in the management and repair of multilevel structured parking garages comparable to the Parking Garage mutually approved by City and the owner ("Mediator") whom the City and the Parking Garage Owner have mutually designated as an independent mediator to mediate the dispute regarding the proposed Work Plans. Within the fifteen (15) business day period following receipt of notice referring the matter to Mediator. the City the Parking Garage Owner and the Inspector shall submit all necessary information with respect to the matter as to which there is a dispute to Mediator to make a final recommendation. Mediator shall be entitled to consult independently with any of the parties or such of their respective consultants as Mediator determines necessary in order for it to make a final recommendation as to the matter within five (5) business days after receipt of the above information Any costs incurred in connection with the mediation of the matter under dispute (other than each party's legal fees), including payment of fees to Mediator, shall be paid by the substantially non-prevailing party. 6. Insurance. (a) Property Insurance. So long as this Easement Agreement remains in effect Parking Garage Owner or the condominium association consisting of the owners of the Parking Garage and the Project Springboard Improvements, shall maintain property insurance on the Parking Garage in an amount not less than the full insurable replacement cost of the Parking Garage (exclusive of the cost of excavations, foundations and footings below the lowest basement floor) insuring against loss or damage by fire and such other risks as may be covered from time to time by a "special cause of loss" form of property insurance and specifically against the following perils. fire, windstorm, hail, cyclone, tornado, riots, terrorism, civil commotion, malicious mischief, vandalism, aircraft, vehicle, smoke damage and sprinkler leakage, earthquake and explosion. The Parking Garage Owner or the condominium association, at its option, may obtain such additional coverages or endorsements as the Parking Garage Owner or such condominium association deems appropriate or necessary, including, without limitation, business income and rent loss i'-12 P1DRSlDRS2UB 09/14/05 insurance, boiler and machinery insurance, flood insurance and other coverages. The Parking Garage Owner or the condominium association may maintain such insurance in whole or in part under blanket policies, so long as that does not reduce the type or amount of coverage required under this Easement Agreement The cost of such insurance shall be paid by the Parking Garage Owner as part of the operating expenses associated with the Parking Garage to be paid by the Parking Garage Owner. (b) Parking Garage Owner's Commercial Liability Insurance. So long as this Easement Agreement remains in effect, Parking Garage Owner shall obtain and keep in force general commercial liability insurance, on an occurrence basis, insuring Parking Garage Owner and City against claims for personal injury (including, without limitation, bodily injury or death), property damage liability and such other loss or damage from such causes of loss as are embraced by insurance policies of the type now known as "Commercial General Liability Insurance," with a combined single limit of not less than $2,000,000 per occurrence and S3,000,000 in the aggregate (per policy year). Parking Garage Owner shall name City as an additional insured and such owner's policy shall be primary and non-contributory to any coverage maintained by City. (c) Insurance Policy Requirements. All insurance required under this Easement Agreement shall (i) be issued by insurance companies authorized to do business in the State of Washington with a rating reasonably satisfactory to Parking Garage Owner and City; (n) be issued as a primary policy in the case of insurance obtained by the Parking Garage Owner pursuant to Section 6(b), and (in) contain an endorsement requiring thirty (30) days' prior written notice (ten (10) days for non-payment of premiums) from the insurance company to the Parking Garage Owner and City and any additional insured or lender before cancellation or change in the coverage, scope, or amount of any policy Each policy or a certificate of the policy shall be deposited with the other party on or before the effective date of this Easement Agreement, and as reasonably available upon replacement or renewal of each policy. 7. Indemnification. Parking Garage Owner shall protect, indemnify, defend and hold City harmless from and against any and all claims, debts, causes of action, demands, obligations, losses, damages, liabilities, judgments or expenses (including reasonable attorney's fees and costs with or without trial or on appeal) now or hereafter arising in connection with the design, development, construction, operation, maintenance, repair or management of the Parking Garage or arising from any act or omission of the Parking Garage Owner, its agents and employees (including, but not limited to, liability imposed by law or for breach of any statutory duty or administration rule or regulation, death or injury to any person or destruction, loss or damage to property) and all claims for personal injury or property damage suffered by persons using the Parking Garage Upon receipt of written notice of any such claim from City, Parking Garage Owner shall defend any such claim at its expense and with counsel reasonably satisfactory to City This indemnification shall survive the expiration or other termination of this Easement F-13 P%DRSORMS M14M5 r r I L Parking Garage Owner's Use of Parking Garage. The Parking Garage Owner reserves for itself all rights associated with its ownership of the Parking Garage, including the right to grant its invitees, tenants and hotel guests of the Project Springboard Improvements the right to park in the Parking Garage so long as such rights do not interfere with the rights granted City under this Easement Agreement The Parking Garage Owner shall have the right to grant other persons easement rights in, on, under, through and across the Parking Garage so long as such easement rights do not interfere with the rights to park in the Parking Garage set forth in Section 2 of this Easement Agreement 12. Default and Remedies. (a) Dental of Access. If access to the Parking Garage is denied by the Parking Garage Owner to members of the general public for reasons which City believes are not permitted under this Easement Agreement, City shall provide the Parking Garage Owner with written notice of the actions that it believes constitutes a breach of its parking easement rights under this Easement Agreement Parking Garage Owner shall have ten (10) days following receipt of written notice in which to restore such access or provide City with notice in writing why it believes its actions are permitted under the terms of this Easement Agreement. In the event Parking Garage Owner has not restored access to members of the general public within ten (10) days following Parking Garage Owner's receipt of written notice, City may petition a court of competent jurisdiction in King County, Washington for entry of an order of specific performance; provided, however, that , the foregoing shall not be City's exclusive remedy and City shall be entitled to seek damages or an injunction or other equitable relief from a court of competent jurisdiction. (b) Failure to Perform Other Obligations. In the event the Parking i Garage Owner fails to perform its obligation to operate and maintain the Parking Garage in accordance with its duties and obligations under this Easement Agreement and after notice and opportunity to cure, in addition to its rights to seek an order of specific performance or other equitable relief from a court of competent jurisdiction, City shall have the right, at Parking Garage Owner's cost and expense, to take such actions and expend such funds as are reasonably required to operate, maintain and repair the Parking Garage (and entrances, exits, elevators, stairs, skybridges, sidewalks, driveways and roadways providing pedestrian and vehicular access to the public and private streets adjoining the Property) in first class order, condition and repair and otherwise in accordance with the requirements of this Easement Agreement. Any amount so expended by City shall be reimbursed by the Parking Garage Owner promptly after demand together with interest at twelve percent (12%) per annum if not paid in full within thirty (30) days following receipt of an invoice for such expense. City shall have no liability to the Parking Garage Owner as a result of the performance of any such work by City Nothing in this Easement Agreement shall imply any duty or obligation upon the part of City to do any such work or to make any such repairs and/or maintenance and the performance thereof by City shall not constitute a waiver of the Parking Garage Owner's default in failing to perform the same Y'-16 P ORSORVUB 09114/05 (c) Remedies not Exclusive. The remedies set forth above and elsewhere in this Easement Agreement are not exclusive and City may pursue any other remedies now or hereafter permitted or available to City under law or equity. 13. Payment of Taxes, Liens and Other Charges. Parking Garage Owner will pay or cause to be paid when due: (a) All taxes, assessments and other governmental or public charges affecting the Property or the Parking Garage and any accrued interest, costs and/or penalties thereon and upon request by City will submit receipts therefore to City promptly Ifollowing payment, (b) All premiums for all insurance policies required to be maintained in full force and effect pursuant to the provisions of Section 6; (c) All encumbrances (including any debt secured by deeds of trust), ground rents, liens and/or charges, with interest which are filed against the Property and/or the Parking Garage and all costs and expenses related thereto, and (d) All charges for utilities or services, including, but not limited to, electricity, gas, water, sewer, garbage collection and telephone service; (e) Should Parking Garage Owner fail to make any payment or do any act as provided in this Section 13, then City shall have the right, but not the obligation and upon reasonable prior notice to or demand upon Parking Garage Owner (except for monetary defaults and defaults in the payment of taxes, assessments or other governmental charges or insurance for which no prior written notice or demand shall be required) and without releasing Parking Garage Owner from any obligation therefor, make or do the same in such manner and to such extent as it may deem necessary to protect its rights under this Easement Agreement, including the right to enter upon the Property and the Parking Garage for such purpose, commence, appear in and defend any action or proceeding purporting to affect its rights under this Easement Agreement, pay, purchase, contest or compromise any encumbrance, charge or lien and in exercising any such power, incur any liability, expend reasonable amounts necessary therefore, including cost of evidence of title, employ an attorney and pay said attorney's reasonable fees Any amount so expended by City shall be reimbursed by Parking Garage Owner promptly after demand together with interest at the rate of twelve percent (12%) per annum if not paid in full within thirty (30) days following receipt of an invoice detailing such expense 14. Notices. All notices, demands, requests, consents and approvals which may, or are required to be given by any party shall be in writing and shall be in writing and shall be validly given or made to the other parties if delivered either personally, or by overnight delivery service of recognized standing, or by United States L Mail, certified, registered, or express mail with postage prepaid, or by facsimile transmission with electronic confirmation of receipt. If such notice is personally delivered F-17 P 1DRS1DRS2UB 09/14/05 or delivered by facsimile during normal business hours, it shall be conclusively deemed given at the time of such delivery If such notice is delivered by facsimile after normal business hours or is delivered by overnight delivery service, it shall be deemed given one (1) business day after receipt thereof(if sent by facsimile transmission) or one (1) business day after the deposit thereof with such delivery service. If such notice is mailed as provided herein, notice shall be deemed given three (3) business days after the deposit thereof in the United States Mail. Each such notice shall be deemed given only if properly addressed to the party to whom such notice is to be given as follows. To City: City of Kent 220 Fourth Avenue Kent, Washington 98030 Attn- City Clerk Fax (253) 856-6725 With a copy to: City of Kent 220 Fourth Avenue Kent, Washington 98030 Attn City Attorney Fax. (253) 856-6770 To Developer: Springboard Holdings, L.L.0 1627 East Sammamish Place SE Sammamish, Washington 98075 Attn: Ben Errez Fax (425) 369-9949 With a copy to: Plan B Development, L.L.C. 12889 Casino Drive Anacortes, Washington 98221 Fax (425) 936-7329 With a copy to: Chairman Swinomish Indian Tribal Community P O. Box 817 LaConner, Washington 98257 Fax (360) 466-5309 To Second Avenue: Second Avenue Real Estate LLC 130 t Fifth Avenue, Suite 2600 Seattle, Washington 9810 t Attn Ben Porter Fax: (206) 587-0579 F-18 P1DRS1DRS2UB 09/14/05 Any party hereto may change its address for the purpose of receiving notices as herein provided by a written notice given in the manner aforesaid to the other parties hereto. 15. Miscellaneous. (a) Captions The captions and paragraph headings contained in this Easement Agreement are for convenience of reference only and in no way limit, describe, extend or define the scope or intent of this Easement Agreement, nor the intent of any of the provisions hereof. (b) Amendments Waivers. No modification or amendment of this Easement Agreement may be made except by written agreement or as otherwise may be provided in this Easement Agreement No failure by City or the Parking Garage Owner to insist upon the strict performance of any covenant, duty, agreement or condition of this Easement Agreement or to exercise any right or remedy consequent upon a breach thereof shall constitute a waiver of any such breach or any other covenant, agreement, term or condition. Any party hereto, by notice and only by notice as provided in Section 14 of this Easement Agreement may, but shall be under no obligation to, waive any of its rights or any conditions to its obligations hereunder, or any duty, obligation or covenant of any other party hereto. No waiver shall affect or alter this Easement Agreement and each and every covenant, agreement, term and condition of this Easement Agreement shall continue in full force and effect with respect to any other then existing or subsequent breach thereof. (c) Merger of Prior Agreements. This Easement Agreement and the Replacement Parking Agreement and exhibits hereto and thereto constitute the entire agreement between the parties with respect to the parking easements intended to be granted by Developer in favor of City as contemplated by Section 3 4 of the Replacement Parking Agreement and supersedes all prior and contemporaneous agreements and understandings between the parties hereto relating to the subject matter hereof. I (d) No Partnership or Joint Venture. It is not intended by this Easement Agreement to, and nothing contained in this Easement Agreement shall, create any partnership, joint venture or other arrangement between the Parking Garage Owner, Second Avenue and City except that of parties to an casement No term or provision of this Easement Agreement is intended to be, or shall be, for the benefit of any person, firm, organization or corporation not a party hereto, and no such other person, firm, organization or corporation shall have any right or cause of action hereunder. (e) Termination of Easements. The easements granted in favor of City under this easement are perpetual, and can be terminated only by an agreement executed in writing by City and the Parking Garage Owner which termination agreement is thereafter recorded in the real property records. F-19 PORSORMB 09/14/05 (f) Time is of the Essence. Time is hereby expressly declared to be of the essence of this Easement Agreement and of each and every term, covenants, agreement condition and provision hereof. (g) Burden and Benefit The easements granted under this Easement Agreement run with the land and the rights, duties, covenants, restrictions, agreements, limitations and obligations herein created shall constitute covenants running with the land, shall burden the Property and the Parking Garage, and all such easements, covenants, restrictions, agreements, limitations and obligations contained herein shall be binding upon and inure to the benefit of the successors and permitted assigns of the respective parties hereto. Developer agrees that City may transfer its rights under this Easement Agreement whether voluntarily, involuntarily, by operation of law or otherwise, to any city, county, governmental subdivision or agency or other municipal corporation (h) Neutral Authorship. In connection with the execution and delivery of this Easement Agreement, each party has been represented by counsel. Each of the provisions of this Easement Agreement has been reviewed and negotiated, and represents the combined work product of both parties hereto The language in all parts of this Easement Agreement shall be construed as a whole according to its fair meeting. No presumption or other rules of construction which would interpret the provisions of this Easement Agreement in favor of or against the party preparing the same shall be applicable in connection with the construction or interpretation of any of the provisions of this Easement Agreement. (i) Non Waiver of Governmental Rights. Nothing contained in this Easement Agreement shalt require City to take any discretionary action relating to development of the improvements to be constructed on the Property as part of Project Springboard, including, but not limited to, zoning and land use decisions, permitting, or any other governmental approvals or enforcement of fire or building codes or other Requirements of Law applicable to the Parking Garage. 0) Priority of Easements granted under this Easement Agreement. The ' public parking and other easements granted under this Easement Agreement shall have priority over any and all hens, encumbrances, leases, subleases, or other interests in the Parking Garage, including, but not limited to any condominium declaration which may be recorded against the Property. The Parking Garage Owner shall, at its sole cost and expense, obtain any and all consents and/or subordinations of other interests in the Property or the Parking Garage, including the subordination of the rights of owners under any condominium declaration, the subordination of the rights of any mortgagees, lessees, sublessees, successors and assigns as may be necessary to assure the City its rights under this Easement Agreement are and remain free and clear of all liens, exceptions, encumbrances or other interests affecting the rights of the public to park in the Parking Garage or the rights of the City under this Easement Agreement. F-20 P 1DRS1DRS2UB 09/14/05 I (k) Attorneys' Fees. Each party shall be responsible for payment of the I legal fees of its counsel in the event of any litigation, mediation, arbitration or other proceeding brought to enforce or interpret or otherwise arising out of this Easement Agreement. (1) Governing Law. This Easement Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Washington In the I event of any litigation to enforce or interpret the rights, duties and obligations of the parties set forth in this Easement Agreement, venue of any such legal action shall he exclusively in King County Superior Court and the parties waive the right to file suit elsewhere. IIN WITNESS WHEREOF, Developer, Second Avenue and City have executed this Easement Agreement as of the date and year first set forth above. IDATED this day of , 2006. ISECOND AVENUE: DEVELOPER: SECOND AVENUE REAL ESTATE LLC, SPRINGBOARD HOLDINGS, L.L.C., a Washington limited liability company a Washington limited liability company I By By: Name. Name Title. Title: Approved as to Form. CITY. I CITY OF KENT, a Washington municipal corporation City Attorney I By: Name- Title I F-21 P OR&ORMB 09/14105 STATE OF WASHINGTON ) ) ss. COUNTY OF KING ) I certify that I know or have satisfactory evidence that is the person who appeared before me, and said person acknowledged that he signed this instrument, and on oath stated that he was authorized to execute the instrument as the of SPRINGBOARD HOLDINGS, L.L.0 , a Washington limited liability company, and acknowledged it to be the free and voluntary act of said SPRINGBOARD HOLDINGS, L.L.C., for the uses and purposes mentioned in the instrument DATED: NOTARY PUBLIC in and for the State of Washington residing at Print Name: My commission expires. STATE OF WASHINGTON ) ss. COUNTY OF KING ) I certify that I know or have satisfactory evidence that is the person who appeared before me, and said person acknowledged that he signed this instrument, and on oath stated that he was authorized to execute the instrument as the of SECOND AVENUE REAL ESTATE, LLC, a Washington limited liability company, and acknowledged it to be the free and voluntary act of said SECOND AVENUE REAL ESTATE, LLC, for the uses and purposes mentioned in the instrument. DATED: NOTARY PUBLIC in and for the State of Washington residing at Print Name. My commission expires. F-22 P ORSORS2UB 09/14/05 i STATE OF WASHINGTON ) ) ss COUNTY OF KING ) I certify that I know or have satisfactory evidence that and are the persons who appeared before me and said persons acknowledged that they signed this instrument, and on oath stated that they were authorized to execute the instrument as the and of CITY OF KENT, a Washington municipal corporation, acknowledged it to be the free and voluntary act and deed of said corporation for the uses and purposes mentioned in the instrument. DATED- NOTARY PUBLIC in and for the State of Washington residing at Print Name- My commission expires. F_23 PORSORMB 09M 4105 EXHIBIT A Legal Description of Parking Garage [To be provided by Title Company prior to Closing.] 1 F-A-I PMFZS\DRS2UB 09/14/05 EXHIBIT B Map of Parking Garage [To be provided by Developer and approved by City prior to November 15, 2005.1 F-B-I PZRS\DRS2UB 09/14/05 EXHIBIT C Definition of Operating Expenses Operating Expenses include all costs incurred by Parking Garage Owner either directly or through a parking operator, parking lessee or property manager in connection with the ownership, use, operation, management, maintenance or repair of the Parking Garage (and entrances, exits, elevators, stairs, skybridges, sidewalks, driveways and roadways providing pedestrian and vehicular access to the public and private streets adjoining the Property including, but not limited to the private street that connects Smith and Harrison Streets) and the restrooms located near the spa facing the Town Square Public Plaza constructed as part of Project Springboard Operating Expenses include, but are not limited to, the following. All utility services provided to the Parking Garage and restrooms; all permits, licenses and certificates necessary to operate, manage and maintain the Parking Garage and any building elevators, all property, liability and other insurance premiums applicable to the Parking Garage including any deductible cost the Parking Garage Owner incurs in connection with any covered loss, worker's compensation insurance, the purchase or rental of supplies, tools, equipment and materials used in connection with the ownership, use, operation, management, maintenance, repair or restoration of the Parking Garage; expenses incurred in order to comply with any laws, regulations or governmental requirements of any kind; fees, if any, paid to parking operators, parking lessees or other property management companies; wages, salaries and other compensation and benefits for all persons engaged in connection with the repair, maintenance, restoration or operation of the Parking Garage, including employer's Social Security taxes, unemployment taxes or insurance, and any other taxes which may be levied on such wages, salaries, compensation and benefits, all Property Taxes (defined below), all operating costs of the Parking Garage and all Parking Garage systems and their equipment and component services, including, but not limited to, janitorial service, trash removal, lighting, security, operation and maintenance of elevators, stairs, skybridges, sidewalks, walkways, driveways, trash removal, cleaning and maintenance, drainage facilities and curbs, including resurfacing, repaving and re-striping of parking facilities, roof maintenance, repair and replacement, maintenance and repair of the Parking Garage; removal of ice and snow; and any service or maintenance contracts related to such operation, repair, maintenance and replacement and reasonable reserves for periodic maintenance and repair. "Property Taxes" means all federal, state, county or local governmental or municipal taxes, assessments, levies, fees, charges or other impositions of every kind and nature levied against the Parking Garage including, without limitation, real and personal property taxes, general and special assessments, transit taxes, water and sewer rent or other similar taxes, fees or changes in taxes assessed in lieu of any of the foregoing excluding inheritance taxes The parties agree that Operating Expenses include the cost of acquisition, installation, operation, maintenance, upgrade or replacement of parking security and access systems F-C-I PORSORMB 09H4105 EXHIBIT D Parking Garage Rules All persons using the Parking Garage shall comply with the following rules: (1) Cars must be parked entirely within the stall Imes painted on the floor, and only small cars may be parked in areas reserved for small cars. (2) All directional signs and arrows must be observed. (3) The speed limit is 5 miles per hour. �j (4) Spaces reserved for disabled parking must be used only by vehicles properly designated. (5) Parking is prohibited in all areas not expressly designated for parking, including without limitation: (a) areas not striped for parking; (b) aisles; (c) where "no parking" signs are posted; (d) ramps; and (e) loading zones. (6) Parking stickers, key-cards or any other devices or forms of identification for entry supplied by Parking Garage Owner shall remain the property of Parking Garage Owner. If parking stickers, key cards or other parking control devices are issued, they must be displayed as requested and not mutilated in any manner The serial number of the parking identification device may not be obliterated Devices are not transferable and any device in the possession of an unauthorized holder will be void. The use of parking stickers, key cards or other parking control devices may be required for persons using Shared Parking Stalls in excess of the applicable Short Term Parking limit (7) Every parker is required to park and lock his or her own car. (8) Loss or theft of parking identification, key-cards or other such devices must be reported to Parking Garage Owner immediately Any parking devices reported lost or stolen that are found on any unauthorized car will be confiscated and the illegal holder will be subject to prosecution Lost or stolen devices should be reported to the Parking Garage Owner immediately F-D-I PV"DRs2u9 09/14/05 (9) Washing, waxing, cleaning or servicing (except in an emergency) of any vehicle in the Parking Garage is prohibited Parking spaces may be used only for parking automobiles or motorcycles. (10) No signs, banners or temporary signs shall be posted or placed within the Parking Garage (other than directional signs). (11) There shall be no sales conducted within the Parking Garage and no kiosks, pushcarts, advertisements or other merchandising units or obstructions placed in the Parking Garage. (12) No person shall use the Parking Garage for any illegal or immoral purpose nor shall any person allow the use, sale or distribution of any alcoholic or intoxicating beverages or controlled or illegal drugs or substances within the Parking Garage (13) No person shall use or permit the use of any part of the Parking Garage for the storage, handling, transportation, disposal or use of any hazardous materials or toxic substances except in strict compliance with all applicable laws (14) Parking Garage Owner shall post copies of the Parking Garage Rules at all entrances and exits to the Parking Garage. (15) Parking Garage Owner may deny access to persons who repeatedly violate these Parking Garage Rules. Parking Garage Owner may tow vehicles at the owner's expense which are parked illegally, parked in a posted "no parking area" or block access to any entrance, exit, ramp or loading dock. (lb) Parking Garage Owner reserve the right to change these Parking Garage Rules from time to time, so long as such Parking Rules do not violate any of the terms or conditions of the Easement Agreement. h'-D-2 P1DRSORMB 09/14/05 EXHIBIT E Definitions For the purposes of this Easement Agreement, the following terms shall have the following meanings- "Hazardous Substances" shall include pollutants or substances defined as "hazardous waste," "hazardous substances," "hazardous materials," "pollutants," "contaminants" or "toxic substances" in the Comprehensive Environmental Response Compensation and Liability Act of 1980, 42 U S C § 9601 et seq. ("CERCLA'), as amended by the Superfund Amendments and Reauthorization Act of 1986 (PL 99-499) ("SARA"), the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et sec , the Toxic Substance Control Act, 15 U.S.0 Section 2601, et seq , the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S C Section 6901 et sM. ("RCRA'), the Clean Water Act, 33 U.S.C. Section 1251 et sec., the Washington State Environmental Policy Act, RCW 43.21 et se .; the Water Pollution Control Act, RCW 90 48 010 et sue., the Hazardous Waste Management Statute, RCW 70 105 et sec ; the Washington Toxic Substance Control Act, RCW 70 105B et seq.; and the Model Toxics Control Act, RCW 70.105D et seq.; and in the rules or regulations adopted and guidelines promulgated pursuant to said laws and any material, waste or substance which is asbestos, petroleum, polychlorinated biphenyls, flammable explosives, radioactive materials, lead or lead-based paint, radon gas, coal combustion byproducts, urea formaldehyde foam insulation, toxic mold, or other substances which are deemed dangerous or injurious to human health "Release" shall mean releasing, spilling, leaking, pumping, pouring, flooding, emitting, emptying, discharging, injecting, escaping, leaching, disposing or dumping Hazardous Substances in, on, under, about or around the Property or the Parking Garage or in or into the air, soil, surface water or groundwater in, on, about or under the Property or the Parking Garage including the migration of Hazardous Substances to or from the Parking Garage and adjoining property. "Environmental Law or Laws" means, as amended from time to time, the Federal Resource Conservation and Recovery Act of 1976, 42 U.S C. Section 6901 et seq , Federal Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 U S C. Section 9601 et seq , Federal Hazardous Materials Transportation Control Act of 1980, 42 U.S.C. Section 1801 et seq , Federal Clean Air Act, 42 U S.C. Section 7401 et seq., Federal Water Pollution Control Act, Federal Water Act of 1977, 93 U S C. Section 1251 et seq , Federal Insecticide, Fungicide and Rodenticide Act, Federal Pesticide Act of 1978, 7 U.S.0 Section 136 et seq., Federal Toxic Substances Control Act, 15 U.S.0 Section 2601 et seq., Federal Safe Drinking Water Act, 42 U S C Section 300f et seq , Washington Water Pollution Control Act, RCW Chapter 90 48, Washington Clean Air Act, RCW Chapter 70 94, Washington Solid Waste Management Recovery and Recycling Act, RCW Chapter 70 95, Washington Hazardous Waste Management Act, RCW Chapter 70.105, Washington F-F-I PIORSORS2US W14105 Hazardous Waste Fees Act, RCW Chapter 70 95E, Washington Model Toxics Control Act, RCW Chapter 70.105D, Washington Nuclear Energy and Radiation Act, RCW Chapter 70 98, Washington Radioactive Waste Storage and Transportation Act, RCW Chapter 70 99, Washington Underground Petroleum Storage Tanks Act, RCW Chapter 70.148, and any regulations promulgated thereunder from time to time. "Remedial Work" means all activities performed in connection with the investigation, assessment, cleanup, removal, mitigation, monitoring or containment of Hazardous Substances in, on. about or under the Property, the Parking Garage, or the Project Springboard Improvements (collectively, the "Affected Property") or any portion thereof to meet the requirements of any Environmental Laws (including common law) relating to the cleanup or remediation of Hazardous Substances (in light of the reasonably intended use of the Affected Property or any portion thereof at the time the Remedial Work commences) or as ordered by any court or any other federal or state governmental agency Remedial Work includes all costs reasonably necessary to comply with then applicable Environmental Laws in connection with the presence, suspected presence, release or suspected release of a Hazardous Substance in or into the air, soil, groundwater, surface water or soil vapor, at, on or within the Affected Property or any portion thereof The term "Remedial Work" also includes the defense or prosecution of any proceedings before a federal or state court, administrative judge or tribunal or federal or state governmental agency, and any and all negotiations with any federal or state governmental agency or its employees or consultants, relating to the foregoing activities and any fines or penalties assessed against the Parking Garage Owner or City, as applicable, in connection therewith. F-F-2 P\DRS\DRS2UB 09/14/05 Exhibit G City Mortgage AFTER RECORDING RETURN TO PRESTON GAThS&ELLIS LLP 925 Fourth Avenue, Suite 2900 Seattle, WA 98 104-1 1 58 Attention. Diane R. Stokke, Esq DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF LEASES AND RENTS AND FIXTURE FILING GRANTOR: SPRINGBOARD HOLDINGS L L C., a Washington limited liability company GRANTEES: (1) CITY OF KENT, a Washington municipal corporation(Beneficiary) (2) WASHINGTON ADMINISTRATIVE SERVICES, INC. (Trustee) Legal Description Abbreviated legal: Additional legal on Exhibit A Assessor's Tax Parcel ID No(s) 1 G-1 P ORSORMB 9114105 i TABLE OF CONTENTS Pam_ ARTICLE I COVENANTS 101. Performance of Replacement Parking Agreement and Deed of Trust..........7 1.02. Warranty of Title. .. . . ..... . .. . ... .. . . . ........ . . .... . . . ..... ................7 103. Tax Deposits [Intentionally Deleted].... . ......... ... ........................ . .. . .......8 1.04. Taxes, Liens and Other Charges ................................................................. .8 1.05. [Intentionally Deleted] .. .......................................................................... . . 9 1.06 Insurance. . ......... . . .............................................................................. 9 1.07. Restoration.......... . . . . ........... . .......... . . .................... ......... .................. 11 1.08. Condemnation . .................................................................... . . ...............13 1 09 Care of the Property................................. . ................................ . .............13 1 10. Further Assurances..................................... . . . . ...................... .................14 1 11. Leases and Other Agreements Affecting the Property............ ... . . . .........15 112. Expenses. . . . . ............................................... . ......................................15 1.13. Inspection of Property.................................................................................15 1.14. Performance by Grantor.......................................................................... . .16 1 15. Assignment of Rents................................................................ .. . . ......... . 16 1.16. Collection of Rents. . ................................................................................ . 16 1.17. Suits to Protect Property .......................... .......................... ..................... 17 1.18. Beneficiary's Right to Defend Action and Cure Certain Defaults..............17 ARTICLE II DEFAULTS AND REMEDIES 2.01. Events of Default.........................................................................................18 2.02. Discontinuance of Proceedings............................... ................................ . 20 2.03. Beneficiary Statement ... ..........................................................................20 2.04. Remedies Upon Default........................................................... ................ 20 2.05. Foreclosure Sale...... ...................... ......................................................... . 22 2.06. Sale of Property Pursuant to a Foreclosure.............................. ................. 22 2.07. Appointment of Receiver . . .. . ... . . .. .................................... .................22 ARTICLE III GENERAL COVENANTS 3 01. No Waiver...... .... ............................... ................... ........... . . . .................22 3 02. Remedies Cumulative............. . . . .... ................... ....................................23 3.03 Plats, Easements and Other Agreements. ...................................................23 3.04. Recordation .. . . . . .. ................. .... ................................................ . ... .23 3 05 Substitution of Trustee.................. ......... ................ . ... . . .... ...................23 3.06. Notices ..................................................... .................................................23 G-2 P\DR&DRS2UB 9M4/05 3.07. Heirs and Assigns; Terminology........................... . ...................................24 3.08. Severability . ..................................................... . . .....................................25 3.09 Time is of the Essence ........................ .................................................... . 25 3.10. Captions . . . . ..... ..... . ........... ...................................................................25 3.11. Irrevocable Trust. . ............. .................................................... ..................25 3.12. Conveyance of Property; Change of Ownership................................. .......25 3.13. Secondary Financing . . . ................................................. ..................... ....26 3.14. Effect of Security Agreement. . . ................. . ............... . ...................... ..26 3 15. Covenants Regarding Environmental Compliance.....................................28 3.16 Non-Agncultural Use............... . . ...................................................... . . .30 3.17. Commercial Purposes, Time of Essence.. . ........................................ . . .30 3.18. Washington State Law Governs....... ..........................................................30 Exhibit A Legal Description i1 I 1 G-3 PORS RMB 9114105 DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF LEASES AND RENTS AND FIXTURE FILING THIS DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF LEASES AND RENTS AND FIXTURE FILING ("Deed of Trust") is made as of the day of November, 2005, by SPRINGBOARD HOLDINGS L L.C., a Washington limited liability company as grantor and debtor ("Grantor"), whose address is 1627 East Sammamish Place SE, Sammamish, Washington 98075, Attention Ben Errez, to WASHINGTON ADMINISTRATIVE SERVICES, INC, as trustee ("Trustee"), whose address is 925 Fourth Avenue, Suite 2900, Seattle, Washington 98104, for the benefit of CITY OF KENT, a Washington municipal corporation, ("City" or "Beneficiary"), whose address is 220 Fourth Avenue, Kent, Washington 98030, Attention• City Attorney. WITNESSETH GRANTOR HEREBY IRREVOCABLY GRANTS, BARGAINS, SELLS, CONVEYS, TRANSFERS AND ASSIGNS- A. To Trustee, in trust, with power of sale and right of entry and possession, all of its present and future estate, right, title and interest in and to that certain real property located in the County of King, State of Washington, as more particularly described in Exhibit A attached hereto and made a part hereof, including all easements and rights used in connection therewith or as a means of access thereto, together with all right, title and interest that Grantor now has or may hereafter acquire in: 1. All income, rents, royalties, revenue, issues, profits and proceeds from any and all of such real property, subject, however, to the right, power and authority hereinafter conferred upon Beneficiary or reserved to Grantor to collect and apply such income, rents, royalties, revenue, issues, profits and proceeds. 2. All deposits or other security or advance payments, including rental payments, made by or on behalf of Grantor to others with respect to (i) utility service for all or any part of said property or any improvements thereon, (n) insurance policies relating to said property or any improvements thereon, and all claims or demands relating to insurance, (in) cleaning, maintenance, repair or similar services for said property or any part thereof or any improvements thereon, and (w)rental of equipment used in the operation of any part of said property or any improvements thereon 3. All fixtures now or hereafter affixed to such real property, including all buildings, structures and improvements of every kind and description now or hereafter erected or placed thereon, and any and all machinery, motors, elevators, skybridges, boilers, equipment (including, without limitation, all equipment for the generation or distribution of air, water, heat, electricity, light, fuel or refrigeration or for ventilating or air-conditioning purposes or for sanitary or drainage purposes or for the removal of dust, G-4 PMRSORS2US 9/14/05 refuse or garbage), partitions, building service equipment, building materials, supplies, electronic audio/visual equipment, computers, software, awnings, carpeting and other floor coverings, lobby furnishings, conduit, wiring, cabling, plumbing, sprinklers and sprinkler equipment, safety systems and equipment, alarms, control devices, security systems, intercoms, any and all trees, plants, shrubs and other landscaping, trash compactors, garbage dumpsters, incinerators and other property of every kind and description now or hereafter placed, attached, affixed or installed in such buildings, structures or improvements, and all replacements, repairs, additions, accessions or substitutions or proceeds thereto or therefor, all of such fixtures, whether now or hereafter placed thereon, being hereby declared to be real property and referred to hereinafter as the "Improvements." 4. All damages, royalties and revenue of every kind, nature and description whatsoever that Grantor may be entitled to receive from any person or entity owning or having or hereafter acquiring a right to the oil, gas or mineral rights and reservations of such real property, with the right in Beneficiary to receive and receipt therefor and apply the same to the indebtedness secured hereby either before or after any default hereunder, and Beneficiary may demand, sue for and recover any such payments but shall not be required so to do. 5. All proceeds and claims arising on account of any damage to or taking of any part thereof, and all causes of action and recoveries for any loss or diminution in the value of such real property or the Improvements. 6. All licenses (including but not limited to any operating licenses or similar matters) contracts, management contracts or agreements, franchise agreements, permits, authorizations or certificates required or used in connection with the ownership of, or the operation or maintenance of, the Improvements. 7. All governmental permits relating to construction, all names under or by which the Improvements or other real property may at any time be operated or known, and all rights to carry on business under any such names or any variant thereof 8. All of Grantor's rights further to encumber said property for debt. All of the property conveyed or intended to be conveyed to Trustee in Paragraph A. above is hereinafter referred to as the "Real Property " B. To Beneficiary, as secured party, a security interest in any portion of the Real Property owned by Grantor which may be construed to be personal property and in all other personal property of every kind and description, whether now existing or hereafter acquired and owned by Grantor, now or at any time hereafter attached to, erected upon, situated in or upon, forming a part of or appurtenant to and which is used or useful in the construction or operation of or in connection with, or arising from the use or enjoyment of all or any portion of, or from any lease or agreement pertaining to, the Real Property, G-5 P1DRMDRS2UB 9114105 i including. 1. All water rights appurtenant to the Real Property, all water permits and applications together with all pumping and distribution equipment, plants, pipes and flumes, all shares of stock or other evidence of ownership of any part of the Real Property that is owned by Grantor in common with others, and all documents of membership in any owners' or members' association or similar group having responsibility for managing or operating any part of the Real Property 2. All plans and specifications prepared for construction of the Improvements and all studies, data and drawings related thereto, and also all contracts and agreements of Grantor relating to the aforesaid plans and specifications or to the aforesaid studies, data and drawings, or to the construction of Improvements. 3 All equipment, machinery, fixtures, inventory, keys and other access devices, plants, decorations, art of any medium, tools, cleaning supplies and equipment, and telephone systems, goods, accounts, investment property, as defined in the Washington Umform Commercial Code, general intangibles, documents, instruments and chattel paper, and all other personal property of every kind and description. r 4. All records and data related to any property herein described, ■ whether in the form of a writing, photographs, microfilm, microfiche, or electronic media, together with all of Grantor's right, title and interest in and to all computer software required to utilize, create, maintain and process any such records or data or electronic media. 5. All substitutions, accessions, additions and replacements to any of the foregoing. 6. All proceeds of any of the foregoing property, including, without limitation, proceeds of any voluntary or involuntary disposition or claim respecting any such property (pursuant to judgment, condemnation award or otherwise) and all goods, documents, general intangibles, chattel paper and accounts, wherever located, acquired with cash proceeds of any of the foregoing or proceeds thereof. All of the property assigned or transferred or intended to be assigned or transferred to Beneficiary in Paragraph B. above is hereinafter referred to as the "Personal Property " All of the Real Property and the Personal Property is referred to herein collectively as the "Property." TO HAVE AND TO HOLD said Property bargained and described, together with i all and singular the lands, tenements, privileges, water rights, hereditaments and appurtenances thereto belonging or in anywise appertaining, and the reversion and reversions, remainder and remainders, rents, issues and profits thereof, and all of the estate, G-6 P 1DRSMRS2UB 9114105 right, title, claim and demands whatsoever of Grantor, either in law or in equity, of, in and to the above-bargained Property forever, as security for the faithful performance of the obligations of Grantor under the Replacement Parking Agreement (defined below) secured hereby and as security for the faithful performance of each and all of the covenants, agreements, terms and conditions of this Deed of Trust, FOR THE PURPOSE OF SECURING: ONE: Performance of each agreement of Grantor herein contained or contained in any other agreement given by Grantor to Beneficiary, including, without limitation, that certain Replacement Parking Agreement of even date herewith (the "Replacement Parking Agreement") executed by Grantor and Beneficiary. TWO: Payment of such sums as Grantor or any successor in ownership hereafter may borrow from Beneficiary when evidenced by note or notes reciting it is secured by this Deed of Trust, payable to Beneficiary or order and made by Grantor or any successor in ownership together with all extensions, renewals, modifications, amendments and replacements thereto. THREE: Payment of all other moneys herein or in the Replacement Parking Agreement agreed or provided to be paid by Grantor and such further sums as may be advanced or loaned by Beneficiary to Grantor pursuant to the terms hereof. GRANTOR REPRESENTS, ALLEGES, WARRANTS, COVENANTS AND AGREES AS FOLLOWS- ARTICLE I COVENANTS 1.01. Performance of Replacement Parking Agreement and Deed of Trust. Grantor will perform and comply with each and every term, covenant and condition hereof, and of the Replacement Parking Agreement All capitalized ternis not otherwise defined herein shall have the definition set forth in the Replacement Parking Agreement 1.02. Warranty of Title. Grantor represents and warrants that at the time of the delivery of this Deed of Trust, (i) Grantor is lawfully possessed and is the owner in fee simple of the Property; (n) the Property is free and clear of any deed of trust, mortgage, lien, charge or encumbrance thereon or affecting the title thereto prior to this Deed of Trust, and none will be created by Grantor during the term of this Deed of Trust except upon such terms and conditions as may be satisfactory to Beneficiary; (iii) Grantor has good right to make this Deed of Trust, (iv) Grantor has good and absolute title to all existing Personal Property, and has good right, full power and lawful authority to convey and encumber the same in G-7 P\0RS\DRS2UB 9114105 the manner and form conveyed and encumbered hereby; that the same is free and clear of all liens, charges, and encumbrances whatsoever, including, as to the Personal Property and fixtures, security agreements, conditional sales contracts and anything of a similar nature and none superior to this Deed of Trust will be created or suffered to be created by Grantor; (v) there is no financing statement covering the Property, or any part thereof, on file in any public office, (vi) Grantor will warrant and forever defend the title to the Property against the claims of all person whomsoever; and (vil) there is no action, litigation or proceeding pending or threatened against Grantor or the Property. 1.03. Tax Deposits. [Intentionally Deleted] 1.04. Taxes, Liens and Other Charges. Grantor will pay when due: (a) All taxes, assessments and other governmental or public charges affecting the Property, including assessments on appurtenant water stock, and any accrued interest, cost and/or penalty thereon and upon request by Beneficiary will submit receipts therefor to Beneficiary promptly following payment, (b) All encumbrances (including any debt secured by deeds of trust), ground rents, liens and/or charges, with interest, on the Property or any part thereof which appear to be prior, superior or on a parity hereto, and all costs and fees related thereto, (c) All charges for utilities or services, including, but not limited to, electricity, gas, sewer and water; (d) All costs, fees and expenses of this Deed of Trust, including cost of evidence of title, Trustee's fees and attorneys' fees in connection with sale pursuant to Paragraph 2.01 (whether completed or not) together with interest from and after ten (10) days following demand for repayment at an interest rate equal to twelve percent(12%) per annum until paid in full, and (e) Grantor may, in good faith, contest, by proper legal proceedings, and at its own expense, the validity or amount of any such tax, assessment or governmental charge. provided that Grantor shall deposit with Beneficiary a sum which shall be at least ten percent (10%) greater than the amount so contested, (unless the contested amount has been paid in full or is not yet due) and also, from time to time, on demand of Beneficiary, such additional sums as may be reasonably required to cover interest or penalties accrued or to accrue on any such item or items, and Beneficiary may upon reasonable notice to Grantor pay such contested item or items out of any sums so deposited in case of undue delay in the prosecution of such proceedings, or if the protection of the Property or of Beneficiary's interest therein shall, in the reasonable judgment of Beneficiary, require such payment G-8 PMRSORS2US 9/14/05 1.05. [Intentionally Deleted]. 1.06. Insurance (a) Grantor will at all times provide, maintain and keep in force or cause to be provided, maintained or kept in force: (i) Builder's risk insurance insuring against loss or damage from such causes of loss as are embraced by insurance policies of the type now known as "Builder's Risk" property insurance (written on an "all risk" or "open perils" basis), including, without limitation, fire and extended coverage, collapse of the improvements and earthquake coverage to agreed limits, all in form and substance acceptable to Beneficiary and (i) as to property then subject to Restoration (as defined in Section 1 07(b)) or any restoration accomplished in connection with a Condemnation, in an amount not less than the full replacement cost of such property, and (n) as to any improvements then being constructed, in an amount not less than the completed value on a non reporting form, of the additional improvements then being constructed, provided, however, that such insurance shall be required only during any period of Restoration or any restoration accomplished in connection with a Condemnation, or any period of construction of any improvements; (it) Policies of insurance insuring the Property against loss or damage by fire and lightning; against loss or damage by other risks embraced by coverage of the type now known as the broad form of extended coverage, including, but not limited to, riot and civil commotion, vandalism and malicious mischief, and against such other risks or hazards as Beneficiary from time to time reasonably may designate in an amount sufficient to prevent Beneficiary or Grantor from becoming a co-insurer under the terms of the applicable policies, but in any event in an amount not less than 100% of the then full 1 replacement cost of the Improvements (exclusive of the cost of excavations, foundations and footings below the lowest basement floor) and Personal Property without deduction for physical depreciation; (iii) Policies of insurance insuring the Property against the loss of "rental value" of any building which constitutes a part of the Improvements on a "rented or vacant basis" arising out of the perils insured against pursuant to subparagraph (a) above in an amount equal to twelve months' gross "rental value" of the Improvements with co- insurance in such percentage as may be acceptable to Beneficiary. "Rental value" as used herein is defined as the sum of (a) the total anticipated gross rental income from tenant occupancy of such buildings, and (b) the amount of all charges which are the legal 1 obligation of tenants and which would otherwise be the obligation of the Grantor, and (c) the fair rental value of any portion of such buildings which are occupied by Grantor; (iv) Flood insurance upon the Property in the event that such ' insurance is available pursuant to the provisions of the Flood Disaster Protection Act of 1973 or other applicable legislation (Beneficiary reserves the right to require that Grantor ' G-9 P ORSOR82UB 9114/05 1 secure flood insurance in excess of the amount provided by the Flood Disaster Protection Act of 1973 if such insurance is commercially available at a reasonable premium up to the amount provided in Paragraph 1.06(a)(i) hereof); (v) Commercial general liability insurance (full form personal injury and broad form property damage) against claims for personal injury (including, without limitation, bodily injury or death) and property damage liability with a coverage limit acceptable to Beneficiary Such insurance coverage shall be issued and maintained on an"occurrence" basis. Beneficiary shall be named as an additional insured thereunder, (vi) Such other insurance, and in such amounts, as may from time to time be reasonably required by Beneficiary against the same or other insurable hazards which at the time are commonly insured against in the case of premises similarly situated, due regard being given to the height and type of buildings thereon and their construction, use and occupancy. (b) All policies of insurance required under this Paragraph 106 shall be issued by companies approved by Beneficiary, shall be subject to the approval of Beneficiary as to amount, content, form and expiration date, shall contain a Noncontnbutory Standard Mortgagee Clause and the Lender's Loss Payable Endorsement (Form 438 BFU NS), or their equivalents, in favor of Beneficiary, and shall provide that the proceeds thereof shall be payable to Beneficiary. Beneficiary shall be furnished with the original of each policy or certificates thereof required to be provided by Grantor hereunder, which policy shall provide that it shall not be modified or cancelled without thirty (30) days' written notice to Beneficiary. At least thirty (30) days prior to expiration of any policy required to be provided by Grantor hereunder, Grantor shall furnish Beneficiary appropriate proof of issuance of a policy continuing in force the insurance so expiring. Grantor shall furnish Beneficiary receipts for the payment of premiums on such insurance policies or other evidence of such payment reasonably satisfactory to Beneficiary. In the event that Grantor does not deposit with Beneficiary a new policy of insurance with evidence of payment of premium thereon at least thirty (30) days prior to the expiration of any expiring policy, then Beneficiary may, but shall not be obligated to, procure such insurance and pay the premiums therefor and Grantor agrees to repay to Beneficiary the premiums thereon promptly on demand, together with interest thereon at an interest rate equal to twelve percent(12%)per annum until paid in full. (c) In the event of any loss or damage to the Property, all proceeds of insurance (the "Insurance Proceeds") shall be payable to Beneficiary, and Grantor hereby authorizes and directs any affected insurance company to make payment of the Insurance Proceeds directly to Beneficiary. The application or release by Beneficiary of any Insurance Proceeds shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. (d) In the event of the foreclosure of this Deed of Trust or other transfer of the title to the Property in extinguishment, in whole or in part, of the indebtedness G-10 PORSORSWB 9/14105 secured hereby, all right, title and interest of Grantor in and to any insurance policy, or I premiums or payments in satisfaction of claims or any other rights thereunder then in force, shall pass to the purchaser or grantee notwithstanding the amount of any bid at such foreclosure sale. 1.07. Restoration. ' (a) After the happening of any casualty to the Property whether or not required to be insured against under the policies to be provided by Grantor hereunder, Grantor shall give prompt written notice thereof to Beneficiary generally describing the nature and cause of such casualty and the extent of the damage or destruction to the Property. (b) Grantor hereby assigns to Beneficiary all Insurance Proceeds which Grantor may be entitled to receive In the event of any damage to or destruction of the Improvements, Grantor shall commence and diligently pursue to completion in accordance with this Section 1.07 the repair, restoration and rebuilding of any portion of the Property that has been partially damaged or destroyed in full compliance with the requirements set forth in the Replacement Parking Agreement and in full compliance with all legal I requirements and to the same condition, character and at least equal value and general utility as nearly as possible to that existing prior to such damage or destruction (the "Restoration"), and Beneficiary shall hold and disburse the Insurance Proceeds (less the cost, if any, to Beneficiary of recovering and paying out such proceeds (including, without limitation, attorneys' fees and expenses, adjuster's fees, and fees incurred in Beneficiary's performance of its obligations hereunder)) (the "Net Insurance Proceeds") in the manner hereinafter provided to the Restoration. (c) Prior to disbursement of any Net Insurance Proceeds for any work in connection with the Restoration (the "Work"), Grantor shall deliver or furnish to Beneficiary (i) complete plans and specifications for the Work which (A) have been approved by all governmental authorities whose approval is required, (B) bear the signed approval of an architect satisfactory to Beneficiary (the "Architect") and (C) are accompanied by Architect's signed estimate of the total estimated cost of the Restoration. Such plans and specifications shall be subject to Beneficiary's approval, which approval shall not be unreasonably withheld (the "Approved Plans and Specifications"), (n) the amount of money which, as determined by Beneficiary, will be sufficient when added to the Net Insurance Proceeds, if any, to pay the entire cost of the Restoration (all money as held by Beneficiary is referred to herein as the "Restoration Funds"); (iu) copies of all permits and approvals required by law to connection with the commencement and conduct of the Restoration; and (iv) a contract for construction executed by Grantor and a contractor satisfactory to Beneficiary (the "Contractor") in form, scope and substance satisfactory to Beneficiary (including the customary retention) for performance of the Work. (d) After commencing the Work, Grantor shall perform or cause G-1 I P MRSORMB 9114/05 Contractor to perform the Work diligently and in good faith in accordance with the Approved Plans and Specifications approved by Beneficiary. So long as Grantor is not in default under the Replacement Parking Agreement, Beneficiary shall disburse the Restoration Funds in increments to Grantor or as Grantor may direct, from time to time as the Work progresses, to pay (or reimburse Grantor for) the costs of the Restoration, but subject to the following conditions, any of which Beneficiary may waive in its sole discretion: (i) Beneficiary shall make such payments only upon not less than ten (10) days' prior written notice from Grantor to Beneficiary and Grantor's delivery to Beneficiary of (A) Grantor's written request for payment (a "Request for Payment") accompanied by a certificate by Architect in form, scope and substance satisfactory to Beneficiary which states that all of the Work completed to that date has been done in compliance with the Approved Plans and Specifications and in accordance with all provisions of law, that the amount requested has been paid or is then due and payable and is properly a part of the cost of the Restoration and that when added to all sums, if any, previously paid out by Beneficiary, the requested amount does not exceed the value of the Work done to the date of such certificate, (B) evidence satisfactory to Beneficiary that there are no construction or similar liens for labor or material supplied in connection with the Work to date or that any such hens have been adequately provided for to Beneficiary's satisfaction, and (C) evidence satisfactory to Beneficiary that the balance of the Restoration Funds remaining after making the payments shall be sufficient to pay the balance of the cost of the Restoration not completed to date (giving in such reasonable detail as Beneficiary may require an estimate of the cost of such completion). Each Request for Payment shall be accompanied by waivers of bens satisfactory to Beneficiary , covering that part of the Work previously paid for, if any, and by a search prepared by a title company or by other evidence satisfactory to Beneficiary that no construction bens or other liens or instruments for the retention of title in respect of any part of the Work have been filed against the Property and not discharged of record and that no encumbrance exists on or affecting the Property other than encumbrances, if any, which are set forth in the title policy issued to Beneficiary insuring the lien of this Deed of Trust; and (ii) Any Request for Payment after the Restoration has been completed shall be accompanied by a copy of any certificate or certificates required by law to render occupancy of the Improvements legal. (e) Upon Beneficiary's receipt of the certificate of occupancy for the Improvements and other customary evidence requested by Beneficiary that the Restoration has been completed and the costs thereof paid in full, and satisfactory evidence that no mechanic's or similar liens for labor or material supplied in connection with the Restoration are outstanding against the Property and Beneficiary's disbursement under the final Request for Payment. Beneficiary shall pay any remaining Restoration Funds then held by Beneficiary to Grantor G-12 POR5\DRMB 9114105 1.08. Condemnation. Should the Property or any part thereof be taken or damaged by reason of any public improvement, condemnation proceeding, or conveyance in lieu thereof, or in any other manner, Beneficiary shall be entitled to all compensation, awards and other payments or relief therefor, and shall be entitled, at its option, to commence, appear in and prosecute in its own name any action or proceeding. Grantor shall have the right, with the prior written consent of the Beneficiary, to make a compromise or settlement to connection with such taking or damage. All such compensation, awards, damages, rights of action and proceeds (the "Condemnation Proceeds") are hereby assigned to Beneficiary, who shall, after deducting therefrom all its reasonable expenses, including attorneys' fees, apply or release the Condemnation Proceeds with the same effect as provided in Paragraph 1 07 above with respect to disposition of insurance proceeds; provided, that if such Condemnation Proceeds are to be utilized for restoration of the Property and there are any excess Condemnation Proceeds after application thereof to the restoration of the Property, Beneficiary shall be entitled to apply such excess as provided in the Replacement Parking Agreement If the Condemnation Proceeds are not applied to the restoration of the Property, the Condemnation Proceeds shall be paid to Beneficiary as provided in Section 22 of the Replacement Parking Agreement. Grantor agrees to execute such further assignments of the Condemnation Proceeds as Beneficiary may require. 1 1.09. Care of the Property. Grantor will: ' (a) Keep the Property in good condition and repair and not commit or permit any waste or deterioration of the Property, 1 (b) Not remove, demolish or substantially alter any portion of the Property, except as approved in writing by Beneficiary and except such alterations as may be required by laws, ordinances or regulations of governmental authorities; (c) Comply with all laws, ordinances, rules, regulations and orders of governmental authorities now or hereafter affecting the Property or requiring any alterations or improvements to be made thereon, and perform all of its obligations under any covenant, condition, restriction or agreement of record affecting the Property, ' (d) Complete promptly and in good and workmanlike manner any portion of the Property which may be constructed hereafter, and promptly restore in like manner as obligated in Paragraph l 07, any portion of the Property which may be damaged 1 or destroyed, and pay, when due, all costs incurred and claims for labor performed and materials furnished therefor; (e) Not commit, suffer or permit any act to be done in, upon or to the Property in violation of any law or ordinance or any covenant, condition or restriction G-13 r'DRSTRszue snaroe affecting the Property; (f) Do any and all acts which, from the character or use of the Property, may be reasonably necessary to protect and preserve the security of Beneficiary, the specific enumerations herein not excluding the general, (g) Not permit any construction liens against the Property; (h) Not take or permit to be taken any actions that might invalidate any insurance carried on the Property, 1.10. Further Assurances. If required by Beneficiary at any time during the term of this Deed of Trust, Grantor will execute, acknowledge and deliver to Beneficiary, in form satisfactory to Beneficiary, such chattel mortgages, security agreements or other similar security instruments, in form and substance satisfactory to Beneficiary, covering all property of any kind whatsoever owned by Grantor or in which Grantor has any interest which, in the sole opinion of Beneficiary, is required to perfect the security interests intended to be created in the real and personal property described in this Deed of Trust or which is essential to the operation of the Real Property covered by this Deed of Trust. Grantor shall further, from time to time, within 15 days after request by Beneficiary, execute, acknowledge and deliver any financing statement, renewal, affidavit, certificate, continuation statement or other document as Beneficiary may request in order to perfect, preserve, continue, extend or maintain the security interest under, and the priority of, this Deed of Trust and the priority of such chattel mortgage or other security instrument as a first lien. Grantor farther agrees to pay to Beneficiary on demand all costs and expenses incurred by Beneficiary in connection with the preparation, execution, recording, filing and refihng of any such instrument or document including the charges for examining title and the attorney's fee for rendering an opinion as to the priority of this Deed of Trust and of such chattel mortgage or other security instrument as a valid first and subsisting lien. However, nether a request so made by Beneficiary nor the failure of Beneficiary to make such request shall be ' construed as a release of such Property, or any part thereof, from the conveyance of title by this Deed of Trust, it being understood and agreed that this covenant and any such chattel mortgage, security agreement or other similar security instrument, delivered to Beneficiary, are cumulative and given as additional security. Any breach of such security agreement shall constitute an Event of Default under this Deed of Trust 1.11. Leases and Other Agreements Affecting the Property. (a) Grantor shall not lease all or any portion of the Property or the Improvements without the prior written consent of Beneficiary. (b) Grantor shall at no time file or record a Condominium Declaration against the Real Property or permit any part of the Real Property to be converted to, or G-14 P1DRS1DRS2UB 9/14105 operated as, a cooperative whereby the tenants or occupants thereof participate in the management or control of the Real Property, as tenants, stockholders or otherwise without the prior written consent of the Beneficiary in accordance with the provisions of the Replacement Parking Agreement. (c) Save and except for taxes and assessments provided to be paid by Grantor as specified in Paragraph 1 04 hereof, Grantor will not create or suffer or permit to be created, subsequent to the date of the execution and delivery of this Deed of Trust, any lien or encumbrance affecting the Real Property except such as have been disclosed to and approved by Beneficiary in writing upon such terms and conditions as may be satisfactory to Beneficiary. 1.12. Expenses. (a) Upon election of either Beneficiary or Trustee so to do, employment of an attorney is hereby authorized and Grantor shall pay all attorneys' fees, costs and expenses, including expenses of retaking, holding, preparing for sale or selling (including cost of evidence or search of title) in connection with any action or actions which may be brought for the foreclosure of this Deed of Trust and/or for possession of the Property and/or for the protection of or the defense of the priority of the hen provided for by this Deed of Trust and/or for the appointment of a receiver and/or for the enforcement of any and all covenants or rights contained in or secured by this Deed of Trust and/or any case or proceeding under Chapters 7, 11, or 13 of the Bankruptcy Code or any successor statute thereto (b) Grantor will pay immediately following demand all sums expended or expenses incurred by Trustee and/or Beneficiary, including, without limitation, attorneys' fees, under any of the terms of this Deed of Trust, with interest from date of 1 expenditure at an interest rate equal to twelve percent(121/'0) per annum until paid in full 1.13. Inspection of Properly. Beneficiary is authorized, by itself, its agents, employees or workmen, to enter at any reasonable time upon any part of the Property for the purpose of inspecting the same upon reasonable prior notice (except in the case of an emergency for which no prior notice need be given), and for the purpose of performing any of the acts it is authorized to perform under the terms of this Deed of Trust Grantor agrees to cooperate with Beneficiary to facilitate such inspections. 1.14. Performance by Grantor. Grantor will faithfully perform each and every covenant to be performed by Grantor under any lien or encumbrance, including, without limiting the generality hereof, mortgages, deeds of trust, leases, declarations or covenants, conditions and/or restrictions and other agreements which affect the Property, in law or in equity, which Beneficiary G_1 rJ P ORSORMB WIV05 reasonably believes may be prior or superior to or on a parity with the lien or charge of this Deed of Trust Grantor shall not, without first obtaining Beneficiary's prior written consent, change the general nature of the occupancy or initiate or acquiesce in any zoning reclassification or suffer any act or thing which would impair the security for Grantor's performance of its obligations under the Replacement Parking Agreement or Beneficiary's lien upon the Property. A breach of or a default under any such lien or encumbrance, or a breach of any requirement of this Paragraph 1.14 shall constitute an event of default under this Deed of Trust. 1 15. Assignment of Rents. Grantor hereby absolutely and unconditionally assigns and transfers to Beneficiary all the income, rents, royalties, revenue, issues, profits and proceeds of the Property, whether now due, past due or to become due, and hereby gives to and confers upon Beneficiary the right, power and authority to collect such income, rents, royalties, revenue, issues, profits and proceeds. Grantor irrevocably appoints Beneficiary its true and lawful attorney at the option of Beneficiary at any time to demand, receive and enforce payment, to give receipts, releases and satisfactions, and to sue, either in the name of Grantor or in the name of Beneficiary, for all such income, rents, royalties, revenue, issues, profits and proceeds. It is understood and agreed that neither the foregoing assignment of income, rents, royalties, revenue, issues, profits and proceeds to Beneficiary nor the exercise by Beneficiary of any of its rights or remedies under this Paragraph 1 15 or under Paragraph 2 04 hereof shall be deemed to make Beneficiary a "mortgagee-in-possession" or otherwise responsible or liable in any manner with respect to the Property or the use, occupancy or enjoyment or operation of all or any portion thereof, unless and until Beneficiary, in person or by agent, assumes actual possession thereof, nor shall appointment of a receiver for the Property by any court at the request of Beneficiary or by agreement with Grantor or the entering into possession of the Property or any part thereof by such receiver be deemed to make Beneficiary a "mortgagee-in-possession" or otherwise responsible or liable in any manner with respect to the Property or the use, occupancy, enjoyment or operation of all or any portion thereof. The foregoing assignment is intended ' to be specific, perfected and choate upon the recording of this Deed of Trust as provided in RCW 7.28.230(3). 1.16. Collection of Rents. Notwithstanding anything to the contrary contained herein or in the Replacement Parking Agreement secured hereby, so long as there is no Event of Default by Grantor in the payment of any indebtedness secured hereby or in the performance of any obligation, covenant or agreement contained herein, in the Replacement Parking Agreement, or in any other agreement given as security for the performance of Grantor's obligations under the Replacement Parking Agreement, Grantor shall have the right to collect all income, rents, royalties, revenue, issues, profits and proceeds from the Property and to retain, use and enjoy the same G-16 PORS\DRSMS 9114105 I i 1.17. Suits to Protect Property. Grantor covenants and agrees to appear in and defend any action or proceeding purporting to affect the security of this Deed of Trust, and/or any additional or other security for the obligations secured hereby, the interest of Beneficiary or the rights, powers and/or duties of Trustee hereunder, and to pay all costs and expenses, including cost of evidence of title and attorneys' fees in a reasonable sum, in any action or proceeding in which Beneficiary and/or Trustee may appear or be made a party, including, but not limited to, foreclosure or other proceeding commenced by those claiming a right to any part of the Property under subordinate liens, in any action to partition or condemn all or part of the Property, whether or not pursued to final judgment, and in any exercise of the power of sale contained herein, whether or not the sale is actually consummated. 1.18. Beneficiary's Right to Defend Action and Cure Certain Defaults. Beneficiary may appear in and defend any action or proceeding at law or in equity or in bankruptcy purporting to affect the Property or the security hereof, and in such event (except where the purported defect affecting the security hereof arises or results from any act or omission of Beneficiary), Beneficiary shall be allowed and paid all Beneficiary's costs, charges and expenses, including cost of evidence of title and attorneys' fees incurred in such action or proceeding in which Beneficiary may appear Should Grantor fail to make any payment or to do any act as herein provided, then Beneficiary or Trustee, but without obligation so to do and upon reasonable prior notice to or demand upon Grantor (except for monetary defaults or defaults in the payment of taxes or insurance for which no prior written notice or demand shall be required) and without releasing Grantor from any obligation hereof, may- make or do the same in such manner and to such extent as either may deem necessary to protect the security hereof, Beneficiary I or Trustee being authorized to enter upon the Real Property for such purposes, commence, appear in and defend any action or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or Trustee, pay, purchase, contest or compromise any encumbrance, charge or lien which in the judgment of either appears to be prior or superior hereto; and, in exercising any such power, incur any liability, expend whatever amounts in its absolute discretion it may deem necessary therefor, including cost of evidence of title, Iemploy an attorney, and pay said attorneys' reasonable fees. Grantor hereby agrees to pay immediately following demand, together with interest from and after ten (10) days following demand for payment at an interest rate equal to twelve percent (12%) per annum until paid in full, all of Beneficiary's costs, charges, expenses and accounts referred to above in this Paragraph 1.18, including cost of evidence of title and reasonable attorneys' fees incurred in such action or proceeding in which Beneficiary may appear. All costs, charges and expenses so incurred, together with interest thereon as aforesaid, shall be secured by the lien of this Deed of Trust. G-17 P%ORSOR32U6 0114105 1 1 ARTICLE 11 DEFAULTS AND REMEDIES 2.01. Events of Default. If any of the following events shall occur("Event or Events of Default')- (a) If Grantor shall fail to perform any material obligation under the Replacement Parking Agreement; or (b) If Grantor has abandoned construction of the Parking Garage for a period of twenty (20) consecutive days (except for Unavoidable Delay as defined in the Replacement Parking Agreement); or (c) If any permit required for construction of the Parking Garage shall be revoked or canceled; or (d) If Grantor shall have assigned, pledged or encumbered its rights, duties or obligations under the Replacement Parking Agreement in violation of the Replacement Parking Agreement; or (e) If Grantor has not commenced construction of the Parking Garage on or before March 31, 2006; or (f) If Substantial Completion of the Parking Garage has not occurred for any reason except for Unavoidable Delay, on or before September 30, 2006 (the Substantial Completion Date); or (g) If Substantial Completion of the Parking Garage has not occurred for any reason whatsoever including Unavoidable Delay on or before March 31, 2007 (the Outside Completion Date); or (h) Grantor applies for or consents to the appointment of a receiver or ' trustee for it or any portion of its property, or if such receiver or trustee is appointed for Grantor, or Grantor admits in writing its inability to pay its debts as they become due, or Grantor becomes insolvent, or a petition is filed by or against Grantor, pursuant to any of the provisions of the United States Bankruptcy Code, as amended; or (i) A petition is filed against Grantor pursuant to any of the provisions , of the United States Bankruptcy Code, as amended, or there is an attachment or sequestration of any of the property of Grantor and the same is not discharged or bonded within ninety (90) days; or 0) Grantor shall cause or institute or there shall be instituted against Grantor any proceeding for the dissolution or termination of Grantor; or G-18 P ORSORS2US 9/14/05 (k) Any representation or disclosure made to Beneficiary by Grantor proves to be materially false or misleading on the date when such representation or disclosure was made, whether or not that representation or disclosure appears in this Deed of Trust; or (1) The occurrence of any of the events described in Paragraphs 3 12 or 3.13 below; or (m) Any judgment or decree in an amount in excess of$10,000 against the Grantor or against the Property shall remain unpaid, unstayed on appeal, undischarged, unbonded or undismissed for a period of 30 days, then and in any such event, the Beneficiary shall be entitled to exercise all rights, and shall have the benefit of all remedies provided by law or set forth in this Deed of Trust or in the Replacement Parking Agreement No waiver of Beneficiary of any default on the part of Grantor shall be construed as a waiver of any subsequent default hereunder. 1 In the event of any such Event of Default and upon written request of Beneficiary, Trustee shall sell the Property in accordance with the Deed of Trust Act of the state of Washington (RCW Chapter 61.24 as existing now or hereafter amended) and the Uniform Commercial Code of the state of Washington, where applicable, at public auction to the highest bidder. Any person except Trustee may bid at Trustee's sale. Trustee shall apply the proceeds of the sale as follows. (i) to the expenses of sale, including a reasonable Trustee's fee and attorneys' fee, (n) to the payment and performance of the obligations set forth in the Replacement Parking Agreement and all other indebtedness secured by this Deed of Trust or any other instrument; (in) the surplus, if any, shall be distributed in accordance with said Deed of Trust Act Trustee shall deliver to the purchaser at the sale its deed, without warranty, which shall convey to the purchaser the interest in the property which Grantor had or had the power to convey at the time of its execution of this Deed of Trust and such as it may have acquired thereafter. Trustee's deed shall recite the facts showing that the sale was conducted in compliance with all the requirements of the law and of this Deed of Trust, which recital shall be prima facie evidence of such compliance and conclusive evidence thereof in favor of bona fide purchasers and encumbrances for value. The power of sale conferred by this Deed of Trust and by the Deed of Trust Act of the state of Washington is not an exclusive remedy, and when not exercised Beneficiary may foreclose this Deed of Trust as a mortgage ' Trustee is not obligated to notify any party hereto of pending sale under any other deed of trust or of any action or proceeding in which Grantor, Trustee or Beneficiary shall I be a party, unless such action or proceeding is brought by Trustee. Beneficiary may proceed as to the Personal Property in accordance with Beneficiary's rights and remedies in respect to the Property or sell the Personal Property 1 separately and without regard to the remainder of the Property in accordance with Beneficiary's rights and remedies provided by the Washington Uniform Commercial Code G-19 P\DRSORSM 9114105 as well as other rights and remedies available at law or in equity. 2.02 Discontinuance of Proceedings. Beneficiary, from time to time before the Trustee's sale pursuant to Paragraph 2 01, may rescind any notice of default or notice of sale by executing and delivering to Trustee a written notice of discontinuance of Trustee's sale, which notice, when recorded, shall also constitute a cancellation of any prior notice of default and notice of sale. The exercise by Beneficiary of such right of rescission shall not constitute a waiver of any breach or default then existing or subsequently occurring, or impair the right of Beneficiary to execute and deliver to Trustee, as above provided, other notices of default and notices of sale, nor otherwise affect any provision, covenant or condition of the Replacement Parking Agreement and/or of this Deed of Trust or any of the rights, obligations or remedies of the parties thereunder or hereunder. 2.03 Beneficiary Statement. Trustee, upon presentation to it of an affidavit signed by or on behalf of Beneficiary setting forth any fact or facts showing a default by Grantor under any of the terms or conditions of this Deed of Trust, is authorized to accept as true and conclusive all facts and statements in such affidavit and to act hereunder in complete reliance thereon. Upon written request by Grantor, Beneficiary will confirm the status of Grantor's performance under the Replacement Parking Agreement. 204. Remedies Upon Default. Grantor covenants and agrees that, should Grantor fail or refuse to make any payment or do any act which it is obligated hereunder to make or do at the time and in the manner herein provided, then Beneficiary, or Trustee upon written instructions from Beneficiary (the legality thereof to be determined solely by Beneficiary), may, without demand upon Grantor, without releasing Grantor from any obligation hereunder and without waiving its right to declare a default as herein provided, or impairing any declaration of default or election to cause the Property to be sold or any sale proceeding predicated thereon- (a) Make or do the same in such manner and to such extent as either Beneficiary or Trustee may deem necessary to protect the security hereof, Beneficiary and Trustee being authorized to enter upon and take possession of the Property for such purposes, and any sums expended for such purposes shall be secured hereby; (b) Commence, appear in and/or defend any action or proceedings purporting to affect the security hereof, and/or any additional or other security therefor, the interest, rights, powers and/or duties of Trustee and/or Beneficiary hereunder, whether brought by or against Grantor, Trustee or Beneficiary, G-20 PIDRS%DRS2UB 9114105 (c) Pay, purchase, contest or compromise any claim, debt, lien, charge or encumbrance which, in the judgment of either, may affect or appear to affect the security of this Deed of Trust, the interest of Beneficiary or the rights, powers and/or duties of Trustee and/or Beneficiary hereunder, and any sums expended for such purposes shall ' be secured hereby, and (d) Beneficiary is authorized, either by itself or by its agent to be appointed by it for that purpose or by a receiver appointed by a court of competent jurisdiction, to enter into and upon and take and hold possession of any portion or all of the Property, both real and personal, and exclude Grantor and all other persons therefrom, to operate and manage the Property and rent and lease the same, to perform such reasonable acts of repair or protection as may be reasonably necessary or proper to conserve the value thereof; and collect any and all income, rents, issues, profits and proceeds therefrom, the same being hereby assigned and transferred to Beneficiary, for the benefit and protection of Beneficiary, and from time to time apply and/or accumulate such income, rents, issues, profits and proceeds in such order and manner as Beneficiary or such receiver, in its sole discretion, shall consider advisable, to or upon the following the expenses of receivership, if any, the proper costs of upkeep, maintenance, repair and/or operation of the Property, the repayment of any sums theretofore or thereafter advanced pursuant to the terms of this Deed of Trust, the taxes and assessments upon the Property then due or next to become due, and/or the amount required to perform Grantor's obligations under the Replacement Parking Agreement. The collection and/or receipt of income, rents, issues, profits and/or proceeds from the Property by Beneficiary, its agent or receiver, after notice of default and notice of sale shall not affect or impair such default or notice of default or notice of sale or any sale proceedings predicated thereon, but such proceedings may be conducted and sale effected notwithstanding the receipt and/or collection of any such income, rents, issues, profits and/or proceeds. Any such income, rents, issues, profits and/or proceeds in the 1 possession of Beneficiary, its agent or receiver, at the time of sale and not theretofore applied as herein provided, shall be applied in the same manner and for the same purposes as the proceeds of the sale ' Neither Trustee nor Beneficiary shall be under any obligation to make any of the payments or do any of the acts referred to in this Paragraph 2.04, and any of the actions referred to in this Paragraph 2.04 may be taken by Beneficiary after an Event of Default has occurred irrespective of whether any notice of default or notice of sale has been given hereunder and without regard to the adequacy of the security for the performance of Grantor's obligations under the Replacement Parking Agreement. 2.05. Foreclosure Sale. ' In the event that this Deed of Trust is foreclosed as a mortgage and the Real Property sold at a foreclosure sate, the purchaser may, during the statutory redemption period, make such repairs or alterations on the Real Property as may be reasonably necessary for the proper operation, care, preservation, protection and insuring thereof Any G-21 PMRSTRMB 9114105 r r sums so paid, together with interest thereon from the time of such expenditure at an interest rate equal to twelve percent (12%) per annum until paid, shall be added to and become a part of the amount required to be paid for redemption from such sale. 2.06. Sale of Property Pursuant to a Foreclosure. In case of a sale pursuant to a foreclosure of this Deed of Trust, the Property, real, personal or mixed, may be sold as an entirety or in parcels, by one sale or by several sales held at one time or at different times, all as Trustee, in its unrestricted discretion, may elect, and Grantor, for and on behalf of itself and all persons claiming by, through or under Grantor, waives any and all right to have the property and estates comprising the Property marshalled upon any foreclosure sale and agrees that, upon foreclosure, the Property may be sold as an entirety and not in parcels. 2.07. Appointment of Receiver. The holder of this Deed of Trust, separately or in any action to foreclose it, shall be entitled(without regard to the adequacy of any security for said debt) to the appointment of a receiver of the income, rents, issues, profits and proceeds of the Property who shall have, in addition to all the rights and powers customarily given to and exercised by such receiver, all the rights and powers granted to Beneficiary by the covenants contained in Paragraph 2 04 hereof. ARTICLE III GENERAL COVENANTS 301. No Waiver. r No failure by Beneficiary to insist upon strict performance of any term, covenant or condition hereof, nor failure to exercise any right or remedy hereunder, shall constitute a waiver of any such breach of such term, covenant or condition or of the later exercise of such right or remedy. All waivers shall be in writing ' 3.02. Remedies Cumulative. No remedy herein conferred upon or reserved to Trustee or Beneficiary is intended r to be exclusive of any other remedy herein or by law provided or permitted, but each shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute. 3.03. Plats, Easements and Other Agreements. At any time upon written request of Beneficiary, payment of its fees and presentation of this Deed of Trust, (in case of full reconveyance, for cancellation and retention) without affecting the liability of any person for the performance of Grantor's G-22 P%DRS1DRS2UB 9114105 r � obligations under the Reimbursement Agreement or the effect of the Deed of Trust upon the remainder of the Property, Trustee may (i) consent to the making of any map or plat of said Real Property, (u)join in granting any easement or creating any restriction thereon; (in)join in any subordination or other agreement affecting this Deed of Trust or the lien or charge thereof; or (iv)reconvey, without warranty, all or any part of the Real Property. The grantee in any reconveyance may be described as the "person or persons legally entitled thereto", and the recitals therein of any matters or facts shall be conclusive proof of the truthfulness thereof. Grantor agrees to pay a reasonable Trustee's fee for full or partial reconveyance, together with a recording fee, if Trustee, at its option, elects to record said reconveyance. 3.04 Recordation. 1 Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. 3.05. Substitution of Trustee. Beneficiary may, from time to time, by a written instrument executed and acknowledged by Beneficiary and recorded in the county or counties where the Property is located, and by otherwise complying with appropriate statutory provisions, substitute a successor or successors for the trustee named herein or acting hereunder. Upon the recording of such appointment in the mortgage records of the county or counties in which the Property is situated, the successor trustee shall be vested with all the powers of the original trustee. 3.06. Notices. (a) All notices hereunder shall be deemed to have been duly given if mailed by United States registered or certified mail, with return receipt requested, postage prepaid, to the parties at the following addresses (or at such other addresses as shall be ' given in writing by any party to the others), and shall be deemed complete upon receipt, refusal of delivery or attempted delivery: To Beneficiary. City of Kent 220 Fourth Avenue Kent, Washington 98030 Attn City Clerk With a copy to: City of Kent 220 Fourth Avenue Kent, Washington 98030 Attn. City Attorney G-23 P WRSORMB 9M4/05 To Grantor: Springboard Holdings, L.L.C. 1627 East Sammamish Place SE Sammamish, Washington 98075 Atm. Ben Errez With a copy to: Plan B Development, L.L.C. 12889 Casino Drive Anacortes, Washington 98221 With a copy to: Chairman, Swmomish Indian Tribal Community P O Box 817 LaConner, Washington 98257 (b) In the event of any strike or occurrence of another similar event which interrupts mail service,notices may be served personally upon an individual, partner or an officer or director of a corporation which is or is part of the party being served hereunder. (c) Grantor requests that a copy of any notice of default and of any f notice of sale hereunder be mailed to Grantor at the address set forth above (d) Unless otherwise provided by applicable law, Trustee shall be under no obligation to notify any party hereto of any action or proceeding of any kind in which Grantor, Beneficiary and/or Trustee shall be a party, unless brought by Trustee, or of any pending sale under any other deed of trust. 3.07. Heirs and Assigns; Terminology. (a) This Deed of Trust applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns The term "Grantor" shall mean both the original Grantor and any subsequent owner or owners of any of the Property. The term "Beneficiary" shall mean the City and any assignee of the City under the Replacement Parking Agreement, whether or not named as Beneficiary herein In this Deed of Trust, whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular number includes the plural. (b) The term "and/or" as used herein means one or the other or both, or any one or all, or any combination of the things or persons in connection with which the words are used. 308 Severability If any provision hereof should be held unenforceable or void, then such provision G-24 PMRSORS2UB 9114105 r r shall be deemed separable from the remaining provisions and shall in no way affect the validity of this Deed of Trust 3.09. Time is of the Essence. rTime is of the essence hereof in connection with all obligations of Grantor herein or in the Replacement Parking Agreement 3.10. Captions. The captions are inserted only as a matter of convenience and for reference, and in no way define, limit or describe the scope or intent of this Deed of Trust nor in any way affect this Deed of Trust. 3.11. Irrevocable Trust. The Trust created hereby is irrevocable by Grantor unless and until the Property is reconveyed to Grantor as provided herein. 3.12. Conveyance of Property; Change of Ownership. In the event that (i) all or any part of or any interest in the Property shall be sold, transferred, leased, further encumbered, conveyed, or a contract of sale or other conveyance entered into with respect thereto, or (it) there is any change in the existing ownership interests of the existing members of Plan B Development, L.L C ("Plan B"), or 1 (in)Plan B ceases to have a controlling interest in Grantor, or (iv) Plan B ceases to be the managing member of Grantor, without the prior written consent of Beneficiary, then, Beneficiary may declare an Event of Default by Grantor under the Replacement Parking Agreement and this Deed of Trust The execution and delivery by the Grantor of any joint venture agreement, partnership agreement, declaration of trust or option agreement whereunder any other person or corporation may become entitled, directly or indirectly, to ' the possession or enjoyment of the Property, or the income or other benefits derived or to be derived therefrom shall in each case be deemed to be a conveyance or assignment of the Grantor's interest in the Property for the purposes of this section, and shall require the 1 prior written consent of the Beneficiary. 3.13. Secondary Financing. ' Grantor agrees that should the Property or any part thereof at any time be or become subject to the lien of any other mortgage or deed of trust or subject to any other I encumbrance, pledge, hypothecation or security interest (except with the prior written consent of Beneficiary), Beneficiary may declare an Event of Default by Grantor under this Deed of Trust. 1 G-25 PORS1DRS2US 9114105 r 3.14. Effect of Security Agreement. This Deed of Trust creates a lien on the Property, and to the extent the Property is not real property under applicable law this Deed of Trust constitutes a security agreement under the Washington Uniform Commercial Code and any other applicable law and is filed ' as a fixture filing. Grantor authorizes Beneficiary to file financing statements covering all personal property and fixtures described herein If required by Beneficiary, at any time during the term of this Deed of Trust, Grantor will execute and deliver to Beneficiary, in form satisfactory to Beneficiary, additional security agreements, financing statements and/or other instruments covering all Personal Property or fixtures of Grantor which may at any time be furnished, placed on, or annexed or made appurtenant to the Real Property , or used, useful or held for use, in the operation of the Improvements Beneficiary may commingle any Personal Property which comes into its possession; repledge such Personal Property upon terms which impair Grantor's right to redeem such; and require Grantor to assemble the Personal Property and make it available to Beneficiary at a place to be designated by Beneficiary which is reasonably convenient to both parties. To the extent Beneficiary is required for any reason to provide commercially reasonable notice to Grantor, Grantor agrees that notice mailed by first class mail ten (10) days before the event of which notice is given, is commercially reasonable notice Grantor shall notify Beneficiary in writing within 30 days of any change in name of Grantor or its legal structure or state of organization. Nothing herein shall be construed as a consent by Beneficiary to a change in legal structure or state of organization otherwise prohibited hereby. Grantor hereby irrevocably constitutes and appoints Beneficiary the attorney-in-fact of Grantor, to execute, deliver and file with the appropriate filing officer or office such security agreements, financing statements or other instruments as Beneficiary may request or require in order to impose and perfect the hen and security interest hereof more specifically on the Personal Property or any fixtures. If Grantor enters into a separate security agreement with Beneficiary relating to any , of the Personal Property or fixtures, the terms of such security agreement shall govern the rights and remedies of Beneficiary in the event of default thereunder. Any breach of or default under any such security agreement shall constitute an Event of Default under this Deed of Trust. It is understood and agreed that, in order to protect Beneficiary from the effect of , RCW 62A 9-313, as amended from time to time, in the event that (i) Grantor intends to purchase any goods which may become fixtures attached to the Property, or any part thereof, and (u) such goods will be subject to a purchase money security interest held by a seller or any other party. (a) Grantor shall, before executing any security agreement or other , document evidencing such security interest, obtain the prior written approval of G-26 P ORSORS2UB 9114105 Beneficiary, and all requests for such written approval shall be in writing and contain the following information- (t) a description of the fixtures to be replaced, added to, installed or substituted; (ii) the address at which the fixtures will be replaced, added to, installed or substituted, and (in) the name and address of the proposed holder and proposed amount of the security interest, and any failure of Grantor to obtain such approval shall be a material breach of Grantor's covenant under this Deed of Trust, and shall, at the option of Beneficiary, entitle Beneficiary to all rights and remedies provided for herein upon default. No consent by Beneficiary pursuant to this subparagraph shall be deemed to constitute an agreement to subordinate the right of the Beneficiary in fixtures or other property covered by this Deed of Trust. (b) If at any time Grantor fails to make any payment on an obligation secured by a purchase money security interest in the Personal Property or any fixtures, Beneficiary, at its option, may at any time pay the amount secured by such security interest and the amount so paid shall be (1) secured by this Deed of Trust and shall be a lien on the Property having the same priorities as the liens and security interests created by this Deed of Trust, and (2) payable on demand with interest at the default rate specified in the Replacement Parking Agreement from the time of such payment. If Grantor shall fail to make such payment to Beneficiary within ten (10) days after demand, the entire principal sum secured hereby with all unpaid interest accrued thereon shall, at the option of 1 Beneficiary, become due and payable immediately. (c) Beneficiary shall have the right to acquire by assignment from the ' holder of such security interest any and all contract rights, accounts receivable, negotiable or non-negotiable instruments, or other evidence of Grantor's indebtedness for such Personal Property- or fixtures, and, upon acquiring such interest by assignment, shall have the right to enforce the security interest as assignee thereof, in accordance with the terms and provisions of the Washington Uniform Commercial Code then in effect, and in accordance with any other provisions of law. (d) Whether or not Beneficiary has paid the indebtedness secured by or taken an assignment of such security interest, Grantor covenants to pay all sums and perform all obligations secured thereby, and if Grantor at any time shall be in default for a peiiod of ten (10) days under such security agreement, it shall be a material breach of Grantor's covenants under this Deed of Trust, and Beneficiary may, at its option, declare the principal sum secured hereby immediately due and payable, time being of the essence G-27 P%DRSORS2US 9I14M (e) The provisions of subparagraphs (b), (c) and (d) above shall not apply if the goods which may become fixtures are of at least equivalent value and quality as any property being replaced and if the rights of the party holding such security interest have been expressly subordinated, at no cost to Beneficiary, to the lien of this Deed of Trust in a manner satisfactory to Beneficiary, providing to Beneficiary a satisfactory opinion of counsel to the effect that this Deed of Trust constitutes a valid and subsisting first lien on such fixtures which is not subordinate to the hen of such security interest under any applicable law, including without limitation, the provisions of RCW 62A.9-313. 3,15. Covenants Regarding Environmental Compliance. (a) Grantor hereby represents, warrants, covenants and agrees to and with Beneficiary that all operations or activities upon, or any use or occupancy of the Property, or any portion thereof, by Grantor, is presently and shall hereafter be in all respects in compliance with all state, federal and local laws and regulations governing or in any way relating to the generation, handling, manufacturing, treatment, storage, use, transportation, spillage, leakage, dumping, discharge or disposal (whether legal or illegal, accidental or intentional) of any Hazardous Substance, and that except as disclosed in writing to and approved by City, Grantor has not at any time placed, suffered or permitted the presence of any such Hazardous Substances at, on, under, within or about the Property or any portion thereof in violation of applicable law. In no event shall Grantor install or maintain on the Property any underground storage tank or similar facility for the storage of any Hazardous Substances (b) Grantor shall keep and maintain the Real Property in compliance with, and shall not cause or permit the Real Property to be in violation of any Environmental Law (as defined herein). "Environmental Laws" shall mean any federal, state or local law, statute, ordinance, or regulation pertaining to health, industrial hygiene or the environmental conditions on, under or about the Real Property, including without limitation the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA"), 42 U.S.0 Section 9601, et sec , as amended by the Superfund Amendments and Reauthorization Act of 1986 (PL 99-499), the Hazardous Materials Transportation Act, 49 U.S C. Section 1801, et �Leq, the Toxic Substance Control Act, 15 U S C. Section 2601, et sue., and the Resource Conservation and Recovery Act of 1976, as amended("RCRA"), 42 U.S.C. Section 6901, et sue. The term "Hazardous Substance"shall include without limitation: (a) Those substances included within the definitions of "hazardous substances," "hazardous materials," "toxic substances," or "solid waste" in CERCLA, RCRA, the Hazardous Materials Transportation Act, 49 U.S C. Section 1801, et sec., and the Toxic Substance Control Act, 15 U.S C. Section 2601 et sec , and in the regulations promulgated pursuant to said laws, G-28 P1DRS1DRS2UB 9114105 (b) Those substances defined as "dangerous wastes," "hazardous wastes" or as "hazardous substances" under the Water Pollution Control Act, RCW 90.48 010 et se ., the Hazardous Waste Management Statute, RCW 70 105 010 et sue., the Washington Toxic Substance Control Act RCW 70.105B.010 et sec., the Washington Model Toxics Control Act, RCW 70.105D O10 et se ., and the Toxic Substance Control Act, 15 U.S.0 Section 2601 et sue., and in the regulations promulgated pursuant to said laws, (c) Those substances listed in the United States Department of Transportation Table (49 C.F.R. 172 101 and amendments thereto) or by the 1 Environmental Protection Agency (or any successor agency) as hazardous substances (40 C F.R. Part 302 and amendments thereto); (d) Storm water discharge regulated under any federal, state or local law, ordinance or regulation relating to storm water drams, including, but not limited to, Section 402(p) of the Clean Water Act, 33 U.S.C. Section 1342 and the regulations promulgated thereunder; (e) Such other substances, materials and wastes which are or become regulated under applicable local, state or federal law, or the United States government, or which are classified as hazardous or toxic under federal, state or local laws or regulations; (f) Any material, waste or substance which is (A) petroleum, (B) asbestos, (C) polychlonnated biphenyls, (D) designated as a "hazardous substance" pursuant to Section 311 of the Clean Water Act, 33 U.S C Section 1251, et sue. (33 U.S C. Section 1321) or listed pursuant to Section 307 of the Clean Water Act (33 U S C. Section 1317), (E) flammable explosives; (F) radioactive materials, (G) lead-based paint; or (H) radon gas, (I) coal combustion byproducts; (J) area formaldehyde foam insulation, (K) toxic mold, or other substances which are deemed dangerous or injurious to human health, 3.16. Non-Agricultural Use. The Real Property which is the subject of this Deed of Trust is not used principally ' for agricultural purposes. 3.17. Commercial Purposes, Time of Essence. The obligations evidenced by the Replacement Parking Agreement were incurred primarily for commercial, investment or business purposes and not for personal, family or ' household purposes Time is of the essence hereof in connection with all obligations of Grantor herein or in the Replacement Parking Agreement. G-29 P NMDRS" 9114= 1 r 3.t8 Washington State Law Governs. This Deed of Trust is to be governed by and construed in accordance with the laws I of the state of Washington At the option of the Beneficiary, the venue of any action to enforce the provisions hereof may be lard in King County, Washington. I IN WITNESS WHEREOF, Grantor has executed this Deed of Trust, Security Agreement, Assignment of Leases and Rents, and Fixture Filing as of the date first written I above. SPRINGBOARD HOLDINGS L.L.C., I a Washington limited partnership By: Name Its I STATE OF WASHINGTON ) r )ss COUNTY OF KING ) I certify that I know or have satisfactory evidence that is the person ' who appeared before me, and said person acknowledged that he signed this instrument, on oath stated that he was authorized to execute the instrument and acknowledged it as the authorized member of Springboard Holdings, L L C to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. Dated Notary Public Print Name My commission expires r I (Use this space for notarial stamp/seal) G-30 PMRSORMB 9/14/05 EXHIBIT A LEGAL DESCRIPTION Certain real property situated in King County, Washington and more particularly described as follows. 1 i 1 1 G-A-I P TRS%DRS2US MUM r Exhibit H Bargain and Sale Deed Replacement Parking Site , AFTER RECORDING RETURN DOCUMENT TO Springboard Holdings, L L C 1627 East Lake Sammamvsh Place S E Sammamish, WA 98075 , Attn Ben Errez BARGAIN AND SALE DEED Grantor(s)• City of Kent, a Washington municipal corporation Grantee(s): Springboard Holdings, L L.C., a Washington limited liability company Abbreviated Legal Description: Additional Legal Description is on Page Exhibit 1 of Document Assessor's Property Tax Parcel or Account No ' H-1 P\DRS\DRS2UB 09/W05 BARGAIN AND SALE DEED THE GRANTOR, CITY OF KENT, a Washington municipal corporation ("City"), 1 for and in consideration of all of the terms, covenants, conditions and provisions set forth in that certain Replacement Parking Agreement dated as of September 30, 2005 (the "Replacement Parking Agreement"), TEN DOLLARS and other good and valuable ' consideration, in hand paid, bargains, sells and conveys to SPRINGBOARD HOLDINGS, L.L C., a Washington limited liability company, as GRANTEE, the following described real estate, situated in the County of King, State of Washington. See Exhibit 1 attached hereto and incorporated herein by this reference ("Property"). TOGETHER WITH all and singular the tenements, hereditaments and appurtenances hereunto belonging or in anywise appertaining, ' SUBJECT however, to all existing interests, including but not limited to the current non-delinquent general and special taxes for the fiscal year of the transfer of title, all reservations, rights of way and easements of record or otherwise and further subject to the matters described in Exhibit 2 attached hereto and by this reference made a part hereof. Grantee has been allowed to make an inspection of the Property and has knowledge as to the past use of the Property Based upon this inspection and knowledge, Grantee is aware of the condition of the Property and GRANTEE ACKNOWLEDGES THAT, PURSUANT TO THE PROVISIONS OF SECTION 8.4 OF THE REPLACEMENT PARKING AGREEMENT BETWEEN CITY AND GRANTEE, THE TRANSFER OF THE PROPERTY IS MADE ON AN "AS IS" CONDITION AND BASIS WITH 1 ALL FAULTS AND CITY HAS NO OBLIGATION TO MAKE REPAIRS, REPLACEMENTS OR IMPROVEMENTS TO THE PROPERTY. IN PARTICULAR, BUT WITHOUT LIMITATION, CITY MAKES NO REPRESENTATIONS OR WARRANTIES WHATSOEVER WITH RESPECT TO THE PHYSICAL CONDITION OR VALUE OF THE PROPERTY, THE PRESENCE OR ABSENCE OF HAZARDOUS SUBSTANCES ON THE PROPERTY, SOILS CONDITIONS, OR OTHER PHYSICAL CHARACTERISTICS OF THE PROPERTY OR THE SUITABILITY OF THE PROPERTY FOR GRANTEE'S INTENDED DEVELOPMENT. CITY MAKES NO ' REPRESENTATION WHATSOEVER REGARDING THE FINANCIAL FEASIBILITY OF GRANTEE'S PROPOSED DEVELOPMENT OR THE PARKING GARAGE AS DEFINED IN THE REPLACEMENT PARKING ' AGREEMENT. UPON CLOSING AND RECORDING OF THIS DEED TO THE PROPERTY, GRANTEE DOES HEREBY WARE AND RELEASE CITY, ITS OFFICIALS, OFFICERS, EMPLOYEES AND AGENTS FROM ANY AND ALL DAMAGES, LOSSES, LIABILITIES, COSTS AND EXPENSES WHATSOEVER (INCLUDING, WITHOUT LIMITATION, REASONABLE ATTORNEYS' FEES H-2 P\DRS\DRS2UB 09M4/05 r r AND COSTS) AND CLAIMS THEREOF, WHETHER DIRECT OR INDIRECT, KNOWN OR UNKNOWN, FORESEEN OR UNFORESEEN, WHICH MAY ARISE , ON ACCOUNT OF OR IN ANY WAY ARISING OUT OF OR IN CONNECTION WITH THE PHYSICAL OR ENVIRONMENTAL CONDITION OF THE PROPERTY OR THE PRESENCE OF ANY HAZARDOUS SUBSTANCES r WHICH MAY EXIST ON THE PROPERTY OR ANY REQUIREMENT OF LAW APPLICABLE THERETO. The term"Environmental Law" means any federal, state or local statute, regulation, , code, rule, ordinance, order,judgment, decree, injunction or common law pertaining in any way to the protection of human health or the environmental including without limitation, the Resource Conservation and Recovery Act, the Comprehensive Environmental Response, Compensation and Liability Act, the Toxic Substance Control Act, the Model Toxics Control Act and any similar or comparable federal, state or local law. The term "Hazardous Substance" means any hazardous substance, toxic, radioactive or infectious substance, material or waste as defined listed or regulated under ' any Environmental Law, and includes, without limitation, petroleum oil and any of its fractions. , This Deed is granted on the express condition that Grantee design, develop, construct and complete the Parking Garage and grant City the Public Parking Easement on the terms and conditions set forth in the Replacement Parking Agreement, which by this reference are incorporated herein and made a part hereof. By acceptance of this Deed, Grantee and its legal representatives, heirs, successors and assigns, does hereby accept and agree to all of the terms, conditions, provisions, reservations, restrictions, releases and indemnities contained herein and in the Replacement Parking Agreement. ' Dated this day of , 2005. 1 APPROVED AS TO FORM: GRANTOR: CITY ATTORNEY CITY OF KENT, a Washington municipal , corporation i By By. , Name: Tom Brubaker Name- Title r r H-3 P 1DRSORMB 09114/05 STATE OF WASHINGTON ) ) ss. COUNTY OF KING ) On this day of , 2005, before me personally appeared , to me known to be the of the CITY OF KENT, a Washington municipal corporation, the corporation that executed the within and foregoing instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said corporation, for the uses and purposes therein mentioned, and on oath stated that he was authorized to execute said instrument and that the seal affixed, if any, is the corporate seal of said corporation. IWITNESS my hand and official seal hereto affixed the day and year first above written. ' Notary Public in and for the State of Washington, residing at My commission expires- [Type or Print Notary Name] ' (Use This Space for Nolanal Seal Stamp ACCEPTED this day of 2005 GRANTEE: ' SPRINGBOARD HOLDINGS, L.L.0 , a Washington limited liability company By: ' Name. Title H-4 P WSORMB 09/14/05 STATE OF WASHINGTON ) ) ss. , COUNTY OF KING ) On this day of 2005, before me personally appeared ' , to me known to be the , of SPRINGBOARD HOLDINGS, L.L.0 , a Washington limited liability company, the limited liability company that executed the within and foregoing instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said limited liability company, for the uses and purposes therein mentioned, and on oath stated that he was authorized to execute said instrument. WITNESS my hand and official seal hereto affixed the day and year first above , written. Notary Public in and for the State of Washington, residing at My commission expires: [Type or Print Notary Name] (Use This Space for Notarial Seal Stamp 1 I H-5 P1DRSORS2US 09114/05 EXHIBIT I ' TO BARGAIN AND SALE DEED LEGAL DESCRIPTION [To follow.] H-Exhibit 1-1 PORSORS2US 09/14/05 EXHIBIT 2 TO BARGAIN AND SALE DEED EXCEPTIONS , [To be finalized following delivery of title report.] REPLACEMENT PARKING AGREEMENT AND TERMS AND CONDITIONS THEREOF- BETWEEN: CITY OF KENT AND SPRINGBOARD , HOLDINGS, L.L C AREA AFFECTED: PROPERTY DESCRIBED ON EXHIBIT I DISCLOSED BY: MEMORANDUM OF REPLACEMENT PARKING AGREEMENT i RECORDING NO: H-Exhibit 2-1 PNDRSORs2UB W14MS , Exhibit I Definitions The following terms shall have the definitions set forth below or are defined in the ' section of the Agreement listed below- "Agreement" Opening paragraph "Anderson" Recital B ' "Anderson Property" Recital C "Certificate of Substantial Completion" Section 19.1.1 ' "City" Opening paragraph "City Loan Policy" Section 6.4 "City Mortgage" Section 4.2 "City Property" Recital A ' "City's Permitted Exceptions" Section 7 3.1 "City's Title Commitment" Section 7.3 "City's Title Policy" Section 7.2 "claims" Section 17.1 "Closing" Section 13.1 ' "Closing Date" Section 13.1 "Construction Drawings" Section 5.2 "Construction Lender" means any bank, mortgage company, financial institution or other person that provides a loan to finance or refinance construction of all or any portion of the Project Springboard Improvements. "Construction Loan" means a loan made by a Construction Lender from time to time to finance ' or refinance construction of the Project Springboard Improvements. "Construction Mortgage" means a mortgage, deed of trust, security agreement or other lien recorded from time to time against the Project Site or any of the Project Springboard Improvements, including the Parking Garage, to secure payment and performance of a Construction Loan. ' I-1 P ORSORMB 09I14105 r "Deed" Section 6.1 ' "Detailed Specifications" means all written detailed requirements for materials, equipment, construction systems, standards and workmanship for the construction of the Parking Garage "Developer" Opening paragraph , "Developer Agreements" Section 12.1 "Developer's Title Policy" Section 6.2 ' "Due Diligence Period" Section 8.1 , "Escrow Agent" Section 4.5 "Default" or"Event(s) of Default" Section 25 1 r "Exclusive Public Parking Stalls" Section 3.4 , "Final Completion" Section 19.2 "Governmental Authority" means any court or any foreign, federal, state, municipal or local ' department, commission, board, bureau, agency, public authority, instrumentality or government regulator with junsdiction over Developer, the Contractor or the Parking Garage. r "Harrison" Recital B "Harrison Exchange Property" Recital A ' "Harrison Property" Recital B ' "Hotel Improvements" Section 2.1 "Indemnification Claim Notice" Section 17.2 , "Indemnified Party" Section 17.2 "Intervening Lien" Section 7.4 r "Land Speculation" Section 12.5 "Liens" Section 15.9 "Material Adverse Effect" means a material adverse effect upon (a) the business or operations of r Developer, Plan B or the general contractor for construction of the Parking Garage ("Contractor"), (b) the legal existence, power of financial condition of the Developer, Plan B or r any member or manager of Developer or Plan B or the Contractor, (c) the validity or enforceability of this Agreement, (d) the rights and remedies of City under this Agreement, or (e) the timely payment of the contractor and the timely performance of the obligations of the 1-2 P MRSORS2US 09/14/05 Contractor, the Developer or Plan B under this Agreement. "Meeker Street" Recital B "Notices" Section 29 "Opening Date" Section 19 2.7 "Outside Completion Date" Section 15.3 "Parking Garage" Section 2 2 "Parking Garage Construction Documents" Section 5.3 "Parking Garage Schematic Design Documents" Section 5.1 "Permitted Exceptions" Section 6.3.1 ' "Phase One" means construction of the Parking Garage and related retail spaces including the private road that will connect Smith and Harrison Streets. ' "Plan B" Section 23.1 "Pooling Agreement" Recital C "Private Land" Recital B "Private Owners" Recital B "proceeding" Section 17.2 ' "Project Site" Recital C ' "Project Springboard" Section 2.1 "Project Springboard Improvements" Section 2.1 "Property" Recital C "Property Permitted Exceptions" Section 6.4 "Public Parking Easement Acceptance Date" Section 20 ' "Public Parking Easement' Section 3.4 and Exhibit F "Replacement Parking Site" Recital A "Requirements of Law" means all requirements relating to land and building construction including, without limitation, building, planning, zoning, subdivision, health, environmental, air I-3 "MDRs2ua MM4105 r quality, flood hazard, fires safety, accessibility and other governmental approvals, permits, r licenses and /or certificates as may be necessary from time to time to comply with all of the foregoing and other applicable statutes, rules, orders, regulations, laws, ordinances and r covenants, conditions and restrict which apply to or affect the design, construction, existence, intended use, operation and/or occupancy of the Parking Garage, the Project Site, the Project Springboard Improvements or any part thereof. r "Schematic Design Documents" are the initial drawings and specifications for the Parking Garage. r "Second Avenue" Opening paragraph "Short Term Parking" Section 2.2 (defined in Public Parking r Easement(Exhibit F)) "SPI" Recital B r "SPI Contribution Agreement" Section 3.1 r "SPI Land" Recital C "Substantial Completion" Section 19.1 r "Substantial Completion Date" Section 12.5 r "Substantially Completed" Section 19.1.2 "Title Commitment" Section 6.3 r "Title Company" Section 4.5 "Town Square Plaza Site" Recital A r "transfer" Section 23.3 r "Unavoidable Delay" Section 15.3 r r r r 1 1-4 P ORSORSM 09114105 r Kent City Council Meeting Date September 20, 2005 Category Btds I. SUBJECT: LID 353: S. 228TH STREET EXTENSION WETLAND MITIGATION PLANTING 2. SUMMARY STATEMENT: The bid opening for this project was held on September 13, 2005, with two bids received The low bid was submitted by Buckley Nursery Co , Inc. in the amount of$327,716.75. The Engineer's estimate was $308,578.29. 3. EXHIBITS: Public Works memorandum 4. RECOMMENDED BY: Staff (Committee, Staff, Examiner, Commission, etc.) 5. FISCAL IMPACT Expenditure? X Revenue? Currently in the Budget? Yes X No If no: Unbudgeted Expense: Fund Amount $ Unbudgeted Revenue. Fund Amount $ 6. CITY COUNCIL ACTION: ' Councilmember -iVk6tL moves, Councilmember L e seconds to authorize the Mayor to enter into a contract with Buckley Nursery Co., Inc in the amount of$327,716 75 for the S 228th Street Extension Wetland Mitigation project. DISCUSSION: ACTION: C- Council Agenda Item No. 8A i PUBLIC WORKS DEPARTMENT Larry Blanchard Public Works Director Phone 253-856-5500 K E N T Fax 253-856-6500 WASHINGTON Address 220 Fourth Avenue S Kent, WA 98032-5895 September 20, 2005 ' TO: Mayor White and Kent City Council FROM- Chad Bieren, Project Engineer THROUGH: Larry Blanchard, Public Works Director SUBJECT: South 228ti' Street Extension Wetland Mitigation Bid opening for this project was held on September 13, 2005 with two bids received. The low bid was submitted by Buckley Nursery Co., Inc in the amount of$327,716 75. The Engineer's estimate was $308,57829. The Public Works Director recommends awarding this contract to Buckley Nursery Co , Inc. Bid Summary Buckley Nursery Co., Inc. $327,716.75 Jansen, Inc $403,058 81 Engineer's Estimate $308,578.29 i i I i 1 � Mayor White and Kent City Council S 228"St Extension Wetland Mitigation -Award Bid 1 ! REPORTS FROM STANDING COMMITTEES AND STAFF A. COUNCIL PRESIDENT_/ B. OPERATIONS COMMITTEE C. PUBLIC SAFETY COMMITTEE i D. PUBLIC WORKS E. PLANNING AND ECONOMIC DEVELOPMENT COMMITTEE F. PARKS AND HUMAN SERVICES COMMITTEE i G. ADMINISTRATIVE REPORTS IREPORTS FROM SPECIAL COMMITTEES rKENT ' OPERATIONS COMMITTEE MINUTES AUGUST 16, 2005 Committee Members Present. Chair Tim Clark, Julie Peterson and Bruce White The meeting was called to order by Tim Clark, Chair at 4:00 p.m. I1. APPROVAL OF MINUTES DATED JULY 19, 2005 Julie Peterson moved to approve the minutes of the July 19, 2005, Operation Committee meeting. Bruce White seconded the motion, which passed 3-0. 2. APPROVAL OF VOUCHERS DATED JULY 29, 2005 AND AUGUST 15, 2005 Finance Manager Bob Nachlmger presented the vouchers for July 29, 2005, and August 15, 2005, for approval Bruce White moved to approve the vouchers dated July 29, 2005, and August 15, 2005. Julie Peterson seconded the motion, which passed 3-0. ' 3. BACKUP SYSTEM REPLACEMENT Information Technology Technical Services Manager Paul Dunn presented the Backup System Replacement Goods and Services Agreement with Right Systems. Mr Dunn advised that the City's data backup systems have reached their limit in terms of age, capacity, and their ability to perform the critical services surrounding data backup and recovery There are two major issues the City is facing with continued use of the existing system, 1) Hardware Age The costs of maintaining the equipment are rising as it grows older; 2) Backup Windows The growth of the amount of data stored by IT and the backup requirements have exceeded the time available to perform full verified backups Without upgrade or replacement, the existing system is inadequate to meet the requirements for data backup and disaster recovery archival purposes. The existing data backup system was installed in the year 2001, and has reached its capacity The Technical Services Division of Information Technology instituted a study to forecast our data backup capacity needs for the next 5 years A thorough evaluation of the technologies and manufacturers was perfonned, and IT decided that the ADIC Pathlight VX 650 system would be adequate to meet the department's requirements. A Request for Quotation was issued for the equipment and installation services, and the lowest bidder was Right Systems of Tumwater, Washington, with a total delivered bid price, including sales tax of S136,645 94 There is no budget impact as it was included in the Technology Plan 2002 —at an estimate of$150,000 Operations Committee Minutes August 16, 2005 Page 2 Julie Peterson moved to recommend that the Council authorize the Mayor to sign Goods and Services Agreements and purchase orders to Right Systems for a replacement data backup system and installation services not to exceed $137,000. Bruce White seconded the motion, which passed 3-0. 2ND QUARTER 2005 FINANCIAL SUMMARY REPORT Assistant Finance Director Cliff Craig presented a PowerPoint presentation for the 2"d Quarter 2005 Financial Summary. This financial summary presentation was for mfonnational purposes only and no action was necessary. The meeting was adj ourned at 4 18 p m. Renee Cameron Operations Committee Secretary i 2 ' CONTINUED COMMUNICATIONS i 'A. - i 1 i 1 1 1 i 1 1 i I i 1 1 1 EXECUTIVE SESSION i 1 ACTION AFTER EXECUTIVE SESSION 1 � co 7D 1 - 1 1 1 1 I 1