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HomeMy WebLinkAboutCAG2000-0386 - Original - Estate of Inez G. Mordhorst - Purchase of Property at 24420 SE 120th St, Kent - 10/24/2000 REAL ESTATE PURCHASE AND SALE AGREEMENT WITH EARNEST MONEY PROVISION Tlus contract controls the terms of the sale of real property (Please read carefully before signing.) This Agreement is entered into between the CITY OF KENT, a Washington municipal corporation, whose mailing address is 220 - 4th Ave. South, Kent, Washington 98032, ("Buyer"), and the ESTATE OF INEZ GERTRUDE MORDHORST, deceased, acting through Joanne Arlene Dubigk and Henry Richard Dubigk, solely in their representative capacity as the duly qualified co-personal representatives of the said probate estate, whose address is 26460 Witte Road, SE, Maple Valley, Washington 98038 ("Seller's,for the sale and purchase of real property as follows: 1 PROPERTY The property which Buyer agrees to buy and Seller agrees to sell, is commonly known to be referenced by the common street address of 24420 SE 120th Street, Kent, Washington 98031, comprising 76 58 acres, more or less, and consists of two adjacent 1/16th sections,nominally 40 acres each, less portions thereof previously conveyed for public roadway purposes (which roadways are now held by the City of Kent in its governmental capacity) and more technically described as the East half of the northwest quarter of Section 21, Township 22 North, Range 05 East, W.M , in King County, Washington, less portions of the north half of said east half previously conveyed for roads. Said property is also referred to as King County tax parcel numbers 212205-9007 and 212205-9011. A further legal description of the property describing it consistent with the current tax parcel numbers is contained in attached Exhibit A. A map indicating the approximate location and relationship of the Property is also attached as Exhibit B, and incorporated herein by this reference The property was historically used by the decedent and her late husband for farm and livestock operations and has long been in unproved and fenced pasture usage, except those portions lying within the shorelines of Clark Lake The only significant residential improvement is the existing farm house which has insignificant value and exhibits extensive deferred maintenance It is provided with drinking water via the historical farm water well system and is connected to an on site septic system of unknown functionality Contracts Purchase&Sale Estate of Inez G Mordhorst 10/23/00 1 of 8 2 EARNEST MONEY. On mutual acceptance of this agreement Seller will receive from Buyer, FIFTY THOUSAND DOLLARS AND N0/100 ($50,000 00) in the form of a City of Kent Purchase Order, as earnest money and part payment on the purchase price for the Property. This Purchase Order will be funded by the deposit of $50,000 into the escrow account with the designated closing agent within 15 days following removal, satisfaction, or waiver of Buyer's feasibility study contingency 3 PURCHASE PRICE The total purchase price for the Property is FIVE MILLION ONE HUNDRED THOUSAND DOLLARS AND N0/100 ($5,100,000.00), payable all cash at closing, with credit for earnest money actually converted to cash prior to closing The cash portion of the purchase price shall be allocated as follows (a) $577,500 shall be allocated to Parcel A, (north parcel) (b) $4,522,500 shall be allocated to Parcel A, (south parcel) 4 CONTINGENCIES This agreement is contingent upon* (a) Acceptance of its terns by the Kent City Council. (b) Buyer's receipt, review and approval of the title report on the property prior to Closing (c) Approval by the Probate Court, if this sale is contested by any of the heirs of the Estate Should any of these contingencies not be met, satisfied, or waived prior to closing, then this Agreement shall terminate, except neither Buyer nor Seller shall have any further rights, duties or obligations hereunder, except for the release of any funded earnest money deposit to the order of Buyer 5 CONVEYANCE AND CONDITION OF TITLE Title to the Property shall be conveyed by Seller to Buyer at closing by Special Warranty Deed, free and clear of hens, encumbrances or defects except those described as permitted exceptions in paragraph 6 below 6 TITLE INSURANCE. On mutual acceptance of this agreement Seller authorizes Buyer, at Buyer's sole cost and expense, to order a preliminary commitment for title insurance from Pacific Northwest Title Company,whose address is 1201 Third Contracts Purchase& Sale Estate of Inez G Mordhorst 10/23/00 2 of 8 Avenue, Suite 3800, Seattle, Washington 98101-3055 or from such other company as Buyer may elect Upon receipt of said preliminary commitment Buyer shall promptly deliver a copy thereof to Seller, indicating specifically which, if any, encumbrances or defects noted therein are not acceptable to Buyer All other encumbrances or defects will be deemed permitted exceptions To the extent Seller commits to pay or otherwise adequately address encumbrances or defects at or prior to closing to the satisfaction of the title insurer, such that it can issue a policy of title insurance, at closing, free and clear of those encumbrances or defects so noted as not acceptable to Buyer, the sale shall proceed to closing. If title cannot be made so insurable prior to the Closing date called for herein, (or as a result of disbursements authorized by Seller to be made from Seller's proceeds at closing), unless Buyer elects to waive such defects or encumbrances (and to forever waive and release any claim against Seller as a result thereof), this agreement shall terminate 7 CLOSING COSTS AND PRO-RATIONS/RELOCATION ASSISTANCE The cost of escrow shall be born by Buyer Real Estate Excise tax shall be charged to and paid by the Buyer Second half property taxes billed and payable for the current year shall be paid by Buyer, without proration Any unpaid utilities shall be pro-rated as of date of vacating residence by Seller's caretaker/tenant The cost of the title insurance issued at closing shall be paid by Buyer, including the costs for any additional endorsements or extensions of the title insurance coverage which Buyer may elect to obtain. In addition Buyer agrees to pay a single lump sum payment of $2,500 in relocation assistance to the Seller's caretaker/tenant At Buyer's election, Buyer may negotiate directly with Seller's Caretaker/tenant to make this payment, in advance of closing, direct to the Caretaker/tenant, to secure her agreement to vacate the residence C prior to 9� closing. If no such direct arrangements are made by Buyer, the relocation assistance shall be disbursed to Seller at closing, but as a separate, designated payment. f 1� 8 CLOSING OF THE SALE/ OPENING ESCROW ACCOUNT AND DEPOSIT. WITH THE EXPRESS UNDERSTANDING THAT TIME IS OF THE ESSENCE FOR THIS AGREEMENT, this sale shall be closed by the City of Kent, without opening an outside escrow, on or before November 21, 2000, which shall also be the termination date of this agreement unless said closing date is extended in writing by mutual agreement of the parties, provided, however, in no event shall Contracts Purchase& Sale Estate of Inez G Mordhorst 10n3/00 3 of 8 closing be delayed beyond February 15, 2001. When notified, the Buyer and Seller will deposit, without delay, in escrow with the City of Kent, all instruments and momes required to complete the transaction in accordance with this agreement Closing, for the purpose of this agreement, is defined as the date that all documents are executed and the sale proceeds are available for disbursement to the Seller. The designated internal escrow account shall be opened by the City of Kent within seven (7) days following mutual acceptance of this agreement (whether or not any contingencies then remain unsatisfied), and the entire unpaid purchase price shall be deposited therem, at the best daily interest available to the City of Kent for City held funds,with all interest earnings on that designated escrow deposit account accruing prior to closing credited and paid to Seller at closing, in addition to the base purchase price of$5,100,000. 9. CASUALTY LOSS. The parties mutually acknowledge that the residential unprovements on the property are not now insured (and are probably uninsurable) and will not be insured by either Seller or Buyer against loss or damage prior to closing nor after closing during any period of extended possession by Seller's current residential tenant. The condition of those improvements at closing or thereafter will not be a material condition of this Agreement and neither Setter nor Buyer shall be under any obligation to insure, improve or maintain the same pending closing or thereafter. 10. POSSESSION. Buyer shall be entitled to possession on closing,e*sept as The parties acknowledge that any personal property remaining on the property following closing,exclusive of the contents of the residence, shall be deemed abandoned in favor of the Buyer Seller agrees to make a reasonable effort to locate and transfer titles to Buyer with respect to any of titled vehicles remaining on the premises after closing 11 SELLER'S REPRESENTATIONS Seller specifically makes no representations except that they are the duly qualified co-personal representatives of the Estate of Inez Gertrude Mordhorst, that they have qualified to serve with non- intervention powers, that they have no knowledge or notice from any governmental agency of any current violation of laws relating to the Property, and that the property is not now encumbered by any leases The house on the Property is currently occupied Contracts Purchase&Sale Estate of Inez G Mordhorst 10/23/00 4 of 8 by one of the daughters of the personal representatives, in a caretaker role only, on a month to month basis, obligated to pay her own utilities but not otherwise paying any rent Buyer acknowledges that it is not acting in reliance on any representations or disclosures by Sellers,that it has completed, or will complete before obtaining final approval by the City Council its own independent investigations of the Property, inclucing but not limited to a Phase I (and, at its option, a Phase II) environmental assessment, at its sole cost and to its personal satisfaction, and waives completion of a Real Property Transfer Disclosure Statement from Sellers. 12 and 13 SELLER'S ENVIRONMENTAL REPRESENTATIONS and. SELLER'S INDEMNITIES. Buyer acknowledges that Sellers are acting solely in their fiduciary capacity as personal representatives of the decedent's estate and In that capacity Sellers offer no representations and no extended warranties or indemnity regarding existent environmental issues Buyer accepts the absence of such representations, warranties, and indemnities and has the option to conduct environmental studies at its sole cost as described elsewhere herein to limit it's potential exposures 14. DEFAULT AND ATTORNEY'S FEES. (a) Buyer's Default. IF BUYER DEFAULTS HEREUNDER, SELLER'S SOLE REMEDY SHALL BE LIMITED TO DAMAGES AGAINST BUYER IN THE LIQUIDATED AMOUNT OF THE EARNEST MONEY PREVIOUSLY PAID BY THE BUYER. BUYER AND SELLER INTEND THAT SAID AMOUNT CONSTITUTES LIQUIDATED DAMAGES SO AS TO AVOID OTHER COSTS AND EXPENSES TO EITHER PARTY IN CONNECTION WITH POTENTIAL LITIGATION ON ACCOUNT OF BUYERS' DEFAULT BUYER AND SELLER BELIEVE SAID AMOUNT TO BE A FAIR ESTIMATE OF ACTUAL DAMAGES (b) Seller's Default. IF SELLER DEFAULTS HEREUNDER, BUYER SHALL HAVE ALL THE RIGHTS AND REMEDIES AVAILABLE AT LAW OR IN EQUITY (c) Attorney's Fees and Costs In the event of litigation to enforce any of the terns or provisions herein, each party shall pay all its own costs and attorney's fees Contracts Purchase&Sale Estate of Inez G Mordhorst 10/23/00 5 of 8 15. NON-MERGER. The terms, conditions, and provisions of this Agreement shall not be deemed merged into the deed, and shall survive the Closing and continue in full force and effect, except where expressly provided otherwise. of), 16. NOTICES All tices required or permitted to be given hereunder shall be in writing and shall be sent S first class marl, postage prepaid and certified marl, r, return receipt requested, personally delivered, or transmitted via facsinul 7 transmission, with receipt verification, addressed as set forth below. (a) All notices to be given to Buyer shall be addressed as follows: John Hodgson City of Kent 220 - 4th Avenue South Kent, Washington 98032-5895 FAX (253) 856-6050 (b) All notices to be given to Seller shall be addressed as follows- Bud and Joanne Dubigk 26460 Witte Road SE Maple Valley, Washington 98038 (425)432-9574 / fax (425)432-8599 and to: D. Bruce Morgan Morgan & McDonald, P.S 17448 Old Highway 99 SE Temno, Washington 98589 (425)941-2262 / fax(425)226-5493 Either party may, by written notice to the other, designate a change of these addresses or telephone/fax numbers or add such other address for the giving of notices as being necessary. All notices shall be deemed given on the day such notice is personally served, or on the date of the facsirrule transmission, or on the third day following the day such notice is marled in accordance with this paragraph 17 ENTIRE AGREEMENT. This Agreement, including all incorporated exhibits, constitutes the full understanding between Seller and Buyer. There have been no verbal or other agreements that modify this Agreement. Contracts Purchase&Sale Estate of Inez G Mordhorst 10/23/00 6 of 8 18. BINDING EFFECT AND SURVIVAL. This Agreement shall be binding upon parties hereto, in their capacity, as designated, and their respective heirs, successors and assigns, provided, however, nothing herein shall imply that the Buyer has any right to assign this Agreement or any rights hereunder. The terms, conditions, and provisions of this Agreement shall survive the closing of this transaction, subject to any express limitations noted herein. 14 DATE OF MUTUAL ACCEPTANCE For the purposes of this Agreement, the date of mutual acceptance of this Agreement shall be the date on which the parties to this Agreement have executed this Agreement as indicated below. 20. EXPIRATION OF COUNTEROFFER. Buyer shall have only until 5 00 p.m October 25, 2000,to accept the purchase and sale agreement as written in this counter offer, by delivering a signed copy thereof to the Seller or the Seller's attorney. If Buyer does not so deliver a signed copy within said period, this agreement shall lapse and all right of the parties hereunder shall terminate. 21 ATTACHMENTS AND ADDENDUM. The following attachments and addendum are attached hereto and included herein by this reference. a legal descriptions of separate tax parcels b area map B —G 22 MEMORIAL NAMING OPPORTUNITY. As an additional inducement to enter into this agreement,the Buyer hereby covenants and agrees to actively collaborate with the Sellers , through the co-personal representatives of the Estate of Inez Gertrude Mordhorst, on design and location, and then to provide and to perpetuate for not less than thirty years following the date of closing of this sale, a commemoratively named memorial park building/outlook or overview/interpretive center structure, including associated treesllandscapmg, or other permanent park improvement on the Property acceptable to the decedent's personal representatives, including a prominently displayed bronze plaque, interpretive center, and historical annotation, expressly commemorating Bill and Inez Mordhorst Contracts Purchase&Sale Estate of Inez G Mordhorst 10/23/00 7 of 8 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date set forth below BUYER: SELLER. THE CITY OF KE T, , ESTATE OF INEZ GERRTTRUDE MORDHORST By. By. �J WHITE, MAYOR HENRY RI HARD (BUD) DUBIOK Co-Personal Represent ve Dated- /D -ate By:��� c� Q. JOANNE ARLENE DUBIG Co-Personal Representative Dated: /0 APPROVED AS TO FORM ATTEST- Y. Ro er A, Lubovlch, Brenda Jacober, I City Clerk CI ty Attorney APPROVED AS TO FORM. By _ D Bruce Morgan Attorney for Co-Personal Representatives. Contracts Purchase&Sale Estate of Inez G Mordhorst 10/23/00 8 of 8 EXHIBIT A Parcel A Assessor's Parcel # 212205-9007 The northeast quarter of the northwest quarter of Section 21, Township 22 North, Range 5 East, W.M., in King County, Washington, EXCEPT those portions for roads, AND EXCEPT portions conveyed to King County for roads by instrument recorded under King County Recording Number 9703201028. Parcel B Assessor's Parcel # 212205-9011 The southeast quarter of the northwest quarter of Section 21, Township 22 North, Range 5 East, W.M., in King County, Washington • Exhibit B AJ FD MIC (HELD KC) N264�6 23 W N 1/4 COR. 132312 132312 675' 0 w 0 N M \ M) lfo p N w o \ n �m S88'56'35"E ON Z o N.T.S. N N FD MIC 1/4" PIN IN r' °' CONC AT INT. OF 20' o SE 248TH ST & N 132 1321 59 N0 AVE SE '^ 2643.19 w S88'S4'55"E n 5290.59 20' FD MIC z 3/8" PIN IN CONC W/PUNCH INT SE 248TH ST & 116TH AVE SE FD MIC-3" BRASS DISK WITH '+' INT SE 256TH ST & 124TH AVE SE Letter of Agreement Between Joanne A and Henry R Dubigk And City of Kent Regarding Mordhorst Estate Tenant Henry and Joanne Dubigk and the City of Kent desire to allow the tenant residing at the Mordhorst estate single family residence located at 24420 SE 120th Street, Kent, Washington to live in the residence until 6 00 p m on Friday, December 15, 2000 The family will have until 8.00 a m on Monday, December 18, 2000 to remove any private property and building fixtures in the residence and on the property Both parties agree to the following. 1) The tenant will live in the residence without charge, and 2) The City will not be responsible for any repairs to the residence while the tenant is living in the residence, and 3) The Tenant shall pay all charges for electricity, water, garbage, heat, telephone and all other services supplied to the residence, and 4) The tenant and Dubigk family agrees to indemnify and hold harmless the City of Kent, against and in respect of, any and all damages, claims, losses, liabilities, judgements, demands, fees, obligations, assessments, and expenses and costs, including, without limitation, reasonable legal, accounting, consulting, engineering and other expenses which may be imposed upon or incurred by tenant, or asserted against tenant, by any other party or parties (including without limitation, a governmental entity) while the tenant is in the residence, and 5) The parties mutually acknowledge that the residential improvements on the property are not now insured and will not be insured during the extended possession by the tenant as per the Purchase and Sale Agreement dated October 25, 2000, and 6) Should said residence be totally destroyed by fire, lightning, earthquake, or any other casualty, this agreement shall be deemed terminated, and 7) The tenant or Dubigk family will notify the City of Kent if the tenant moves from the residence prior to December 16, 2000. The Dubigk family will have 48 hours after the tenant vacates the residence to remove private property and building fixtures in the residence and on the property Signed I D 4Henry ubigk G1 Ut`�,6"jv ti City of e t bigk Date Date POLICY OF TITLE INSURANCE ISSUED BY SUBJECT TO THE EXCLUSIONS FROM COVERAGE, THE EXCEPTIONS FROM COVERAGE CONTAINED IN SCHEDULE B AND THE CONDITIONS AND STIPULATIONS, PACIFIC NORTHWEST TITLE INSURANCE COMPANY, INC , a Washington corporation, herein called the Company, Insures, as of Date of Policy shown in Schedule A, against loss or damage, not exceeding the Amount of Insurance stated in Schedule A, sustained or incurred by the Insured by reason of 1 Title to the estate or interest described in Schedule A being vested other than as stated therein, 2 Any defect in or lien or encumbrance on the title, 3 Unmarketability of the title, 4 Lack of a right of access to and from the land The Company will also pay the costs, attorneys' fees and expenses incurred in defense of the title, as Insured, but only to the extent provided in the Conditions and Stipulations IN WITNESS WHEREOF, Pacific Northwest Title Insurance Company, Inc has caused this policy to be signed and sealed by its duly authorized officers as of the Date of Policy shown In Schedule A PACIFIC NORTH\V F_ST TITLE C eM d by insurance Companv Inc X2 '01 tA>E i&9gy Authorized Signal ��rS�rpNPoMR'k o -, 1a ?.�C'`'C NCRTHLVEST TITLt Company Seattle, Washington Ya4591a61a'� City,State EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy and the Company will not pay loss or damage,costs attorneys'fees or expenses which arise by reason of 1 (a) Any law, ordinance or governmental regulation (including but not limited to building and zoning laws, ordinances or regulations)restricting, regulating prohibiting or relating to (n)the occupancy, use or enjoyment of the land, (n) the character dimensions or location of any improvement now or hereafter erected on the land,(in)a separation in ownership or a change in the dimensions or area of the land or any parcel of which the land is or was a part or(iv)environmental protection,or the effect of anv violation of these laws ordinances or governmental regulations except to the extent that a notice of the enforcement thereof or a notice of a defect, lien or encumbrance resulting from a violation or alleged violation affecting the land has been recorded in the public records at Date of Policy (b) Any governmental police power not excluded by(a)above,except to the extent that a notice of the exercise thereof or a notice of a defect lien or encumbrance resulting tram a violation or alleged violation affecting the land has been recorded in the public records at Date of Policy 2 Rights of eminent domain unless notice of the exercise thereof has been recorded in the public records at Date of Policy but not excluding from coverage any taking which has occurred prior to Date of Policy which would be binding on the rights of a purchaser for value without knowledge 3 Defects liens,encumbrances,adverse claims or other matters (a) created suffered assumed or agreed to by the insured claimant, !bi not known to the Company,not recorded in the public records at Date of Policy,but known to the insured cia,mant and not disclosed in writing to the Company by the insured claimant prior to the date the insured claimant became an insured uneer this policy, (c) resulting in no loss or damage to the insured claimant (d) attaching or created subsequent to Date of Policy,or (a) resulting in loss or damage which would not have been sustained if the insured claimant had paid value for the estate or interest insured by this policy 0-1093- 91727 ALTA OWNER'S POLICY—10-17-92 EXCLUSIONS FROM COVERAGE Continued (continued and concluded from front side of Policy Face) 4 Any claim,which arises out of the transaction vesting in the Insured the estate or interest insured by this policy by reason of the operation of federal bankruptcy state insolvency,or similar creditors rights laws,that is based on (a) the transaction creating the estate or Interest insured by this policy being deemed a fraudulent conveyance or fraudulent transfer or (b) the transaction creating the estate or interest Insured by this policy being deemed a preferential transfer except where the preferential transfer results from the failure (I) to timely record the Instrument of transfer, or (u) of such recordation to Impart notice to a purchaser tot value or a judgement or ben creditor CONDITIONS AND STIPULATIONS 1 DEFINITION OF TERMS may take any appropriate action under the terms of this policy whether or not it The following terms when used in this policy mean shall be liable hereunder, and shall not thereby concede liability or we've any (a) 'insured" the insured named in Schedule A,and,subject to any rights or provision of this policy If the Company shall exercise Its rights under this paragraph defenses the Company would have had against the named Insured those who it shall do so diligently succeed to the interest of the named Insured by operation of law as distinguished (c) Whenever the Company shall have brought an action or Interposed a from purchase Including but not limited to,heirs distnbutees,devices,survivors, defense as required or permitted by the provisions of this policy,the Company may personal representatives,next of kin,or corporate or fiduciary successors pursue any litigation to final determination by a court of competent jurisdiction and (b) "insured claimant" an insured claming loos or damage expressly reserves the right, in Its sole discretion, to appeal from any adverse judgment or order (c) "knowledge" or"known" actual knowledge not constructive knowledge (d) In all cases where this policy permits or requires the Company to prosecute or notice which may be imputed to an Insured by reason of the public records as or provide toy the defense of any action or proceeding the insured shall secure to defined in this policy orally other records which impart constructive notice of matters the Company the right to so prosecute or provide defense in the action or affecting the land proceeding and all appeals therein,and permit the Company to use,at its option, (d) "land" the land described or referred to in Schedule A and improvements the name of the insured forthis purpose Whenever requested by the Company the affixed thereto which by law constitute real property The term "land" does not insured,at the Company s expense,shall give the Company all reasonable aid(I)in include any property beyond the lines of the area described or referred to in Schedule any action or proceeding, securing evidence,obtaining witnesses, prosecuting or A nor any right title interest,estate or easement in abutting streets roads avenues, defending the action or proceeding, or effecting settlement, and (u) in any other alleys,lanes,ways or waterways,but nothing herein shall modify or limit the extent lawful act which in the opinion of the Company may be necessary or desirable to to which a right of access to and from the land is insured by this policy establish the title to the estate or interest as insured If the Company is prejudiced (a) mortgage' mortgage deed of trust, trust deed, or other security by the failure of the msuretl to furnish the required cooperation the Company s instrument obligations to the insured under the policy shall terminate,including any liability or obligation to defend,prosecute,or continue any litigation with regard to the matter (f) 'public records' records established under state statutes at Date of Policy or matters requiring such cooperation for the purpose of imparting constructive notice of matters relating to real property to purchasers for value and without knowledge With respect to Section 1(a))Iv)of 5 PROOF OF LOSS OR DAMAGE the Exclusions From Coverage, public records" shall also include environmental In addition to and after the notices required under Section 3 of these Conditions protection hens filed in the records of the clerk of the United States district court and Stipulations have been provided the Company a proof of loss or damage signed nor the district in which the land is located and sworn to by the insured claimant shall be furnished to the Company within 90 (g) "unmarkelabllny of the htie" an singed or apparent matter affecting the days after the Insured claimant shall ascertain the facts giving rise to the loss or title to the land not excluded or excepted from coverage which would entitle a tlamage The proof of loss or damage shall describe the defect in or lien or purchaser of the estate or interest descrbed in Schedule Are be released from the encumbrance on the title or other matter insured against by this policy which obligation to purchase by virtue of a contractual condition requiring the delivery of constitutes the basis of loss or damage and shall state, to the extent possible the marketable title basis of calculating the amount of the loss or damage If the Company is prejudiced bythe failure of the insured claimant to provide the required proof of loss or damage 2 CONTINUATION OF INSURANCE AFTER CONVEYANCE OF TITLE the Company's obligations to the insured under the policy shall terminate including The coverage of this policy shall continue in force as of Date of Policy in favor any liability or obligation to defend prosecute,or continue any litigation,with regard of an insured only so long as the insured retains an estate or interest in the land,or to the matter or matters requiring such proof of loss or damage holds an indebtedness secured by a purchase money mortgage given by a purchaser In addition the Insured claimant may reasonably be required to submit to form the insured, or only so long as the insured shall nave liability by reason of examination under oath by any authorized representative of the Company and shall covenants of warranty made by the insured in any transfer of conveyance of the produce for examination inspection and copving at such reasonable times and estate or interest This policy shall not continue in force in favor of any purchaser places as may be designated by any authorized representative of the Company all from the insured of either 10 and estate or mterest in the land,or(n)an indebtedness records books ledgers,checks correspondence and memoranda whether teeing secured by a purchase money mortgage given to the insured a date before or after Date of Policy which reasonably pertain to the loss or damage Further,if requested by any authorized representative of the Company the insured 3 NOTICE OF CLAIM TO BE GIVEN BY INSURED CLAIMANT claimant shall grant its permission in writing,for any authorized representative of The insured shall notify the Company promptly in writing (I) in case of any the Company to examine inspect and copy all records books ledgers, checks litigation as set forth in Section 4(a)below (IQ in case knowledge shall come to an correspondence and memoranda in the custody or control of a third party, which insured hereunder of any claim of title or interest which is adverse to the title to the reasonably pertain to the loss or damage All information designated as confidential estate or interest,as insured,and which might cause loss or damage for which the by the insured claimant provided to the Company pursuant to this Section shall not Company may liable by virtue of this policy,or(u) if title to the estate or interest be disclosed to others unless in the reasonable judgment of the Company if is as insured is rejected as unmarketable If prompt notice shall not be given to the necessary in the admina trat ion of the clam Failure of the insured claimant to submit Company, then as to the insured all liability of the Company shall terminate with for examination under oath,produce other reasonably requested information or grant regard to the matter or matters for wmch prompt notice is required provided, permission to secure cease nably necessary information from third parties as required however that failure to notify the Company shall in no case prejudice the rights of in this paragraph shall terminate any liability of the Company under this policy as any insured under this policy unless the Company shall be prejudiced by the failure to that clam and then only to the extent of the prejudice 6 OPTIONS TO PAY OR OTHERWISE SETTLE CLAIMS TERMINATION OF 4 DEFENSE AND PROSECUTION OF ACTIONS DUTY OF INSURED LIABILITY CLAIMANT TO COOPERATE In case of a claim under this policy, the Company shall have the following (a) Upon written request by the insured and subject to the options contained additional options in Section 6 of these Conditions and Stipulations, the Company, at its own cost (a) To Pay or Tender Payment of the Amount of Insurance and without unreasonable delay shall provide for the defense of an Insured in litigation in which any third party asserts a claim adverse to the title or interest as To pay or tender payment of the amount of insurance under this policy together insured, but only as to those stated causes of action alleging a defect, ben or with any cost,attorneys'fees and expenses incurred by the insured claimant,which encumbrance or other matter insured against by this policy The Company shall were authorized by the Company,up to the time of payment or tender of payment have the right to select counsel of its choice(subject to the right of the insured to and which the Company is obligated to pay object for reasonable cause)to represent the insured as to those stated causes of Upon the exercise by the Company of this option,all liability and obligations action and shall not be liable for and will not pay the fees of any other counsel The to the insured under this policy, other than to make the payment required, shall Company will not pay any fees, costs or expenses incurred by the insured in the terminate, including any liability or obligation to defend, prosecute or continue defense of these causes of action which allege matters not insured against by this any litigation,and the policy shall be surrendered to the Company for cancellation policy (b) To Pay or Otherwise Settle With Parties Other than the Insured or With (b) The Company shall have the right,at its own cost,to institute and prosecute the Insured Claimant any action or proceeding orto do any other act which in its opinion may be necessary • (I) to pay or otherwise settle with other parties for or in the name of an or desirable to establish the title to the estate or interest,as insured The Company insured claimant any claim Insured against untler this policy,together with any casts, (continued and concluded on last page of this policy) d CONDITIONS AND STIPULATIONS Continued (continued and concluded from reverse side of Policy Face) attorneys' fees and expenses Incurred by the insured claimant which were 12 PAYMENT OF LOSS authorized by the Company up to the time of payment and which the Company is (a) No payment shall be made without producing this policy for endorsement obligated to pay,or of the payment unless the policy has been lost or destroyed,in which case proof of (II) to pay or otherwise settle with the Insured claimant the lass or damage loss or destruction shall be furnished to the satisfaction of the Company provided for under this policy,together with any costs,attorneys fees and expenses (b)When liability and the extent of loss or damage has been definitely fixed in Incurred by the Insured claimant which were authorized by the Company up to the accordance with these Conditions and Stipulations the lass or damage shall be time of payment and which the Company is obligated to pay payable within 30 days thereafter Upon the exercise by the Company of either of the options provided for in paragraphs all)or(it),the Company's obligations to the Insured under this policy 13 SUBROGATION UPON PAYMENT OR SETTLEMENT for the claimed loss or damage,other than the payments required to be made,shall (a) The Company's Right of Subrogation terminate,Including any liability or obligation to defend,prosecute or continue any Whenever the Company shall have settled and paid a claim under this policy litigation all right of subrogation shall vest in the Company unaffected by any act of the 7 DETERMINATION,EXTENT OF LIABILITY AND COINSURANCE Insured claimant This policy is a contract of Indemnity against actual monetary loss or damage The Company shall be subrogated to and be entitled to all rights and remedies sustained or incurred by the insured claimant who has suffered loss or damage by which the insured claimant would have had against any person or property in respect reason of matters insured against by this policy and only to the extent herein to the claim had this policy not been issued If requested by the Company, the described insured claimant shall transfer to the Company all rights and remedies against any person or property necessary in order to perfect this right of subrogation The insured (a) The liability of the Company under this policy shall not exceed the least of claimant shall permit the Company to sue compromise or settle in the name of the ill the Amount of Insurance stated in Schedule A,or, insured claimant and to use the name of the insured claimant in any transaction or (I) the difference between the value of the insured estate or interest as litigation involving these rights or remedies insured and the value of the insured estate or interest subject to the defect lien or If a payment on account of a claim does not fully cover the loss of the insured encumbrance insured against by this policy claimant the Company shall be subrogated to these rights and remedies of the (b) in the event the Amount of Insurance stated in Schedule A at the Date of proportion which the Company's payment bears to the whole amount of the loss Policy is less than 80 percent of the value of the insured estate or interest or if If loss should result from any act of the insured claimant as stated above subsequent to the Date of Policy an improvement is erected on the land which that act shall not void this policy but the Company in that event,shall be required increases the value of the insured estate or interest by at least 20 percent over the to pay only that part of any losses insured against by this policy which shall exceed Amount of Insurance stated Schedule A then this Policy is subject to the following the amount,if any,lost to the Company by reason of the impairment by the insured (i) where no subsequent improvement has been made as to any partial claimant of the Company s right of subrogation loss the Company shall only pay the loss pro rate in the proportion that the amount (b) The Company's Rights Against Non-insured Obligors of insurance at Date of Policy bears to the total value of the insured estate or interest The Company's right of subrogation against non-insured obligors shall exist at Date of Policy,or and shall include without limitation, the rights of the insured to indemnities (a) where a subsequent improvement has been made as to any partial guaranties other policies of insurance or bonds notwithstanding any terms or loss the Company shall only pay the loss pro rate in the proportion that 120 percent conditions contained in those instruments which provide for subrogation rights Dy of the Amount of Insurance stated in Schedule A bears to the sum of the Amount of reason of this policy Insurance stated in Schedule A and the amount expended for the improvement The provisions of this paragraph shall not apply to costs,attorneys fees and 14 ARBITRATION expenses for which the Company is liable under this policy,and shall only apply to Unless prohibited by applicable law either the Company or the insured may that portion of any loss which exceeds,in the aggregate 10 percent of the Amount demand arbitration pursuant to the Title Insurance Arbitration Rules of the American of Insurance stated in Schedule A Arbitration Association Arbitrable matters may include,but are not limited to any (c) The Company will pay only those costs attorneys' fees and expenses controversy or claim between the Company and the insured arising out of or relating incurred in accordance with Section 4 of these Conditions and Stipulations to this policy any service of the Company in connection with its issuance or he breach of a policy provision or other obligation All arbitrable matters when ne 8 APPORTIONMENT Amount of Insurance is$1 000 000 or less shall be arbitrated at the option of eb Per the Company or the insured All arbitrable matters when the Amount of Insurance is If the land described in Schedule A consists of two or more parcels which are in excess of 51,000,000 shall be arbitrated only when agreed to by both the Company not used as a single site, and a loss is established affecting one or more of the and the insured Arbitration pursuant to this policy and under the Rules in effect on parcels but not all,the loss shall be computed and settled on a pro rate basis as if the date the demand for arbitration is made or, at the option of the insured -e the amount of insurance under this policy was divided pro rate as to the value on Rules in effect at Date of Policy shall be binding upon the parties The award may Date of Policy of each separate parcel to the whole exclusive of any improvements include attorneys' fees only if the laws of the state in which the land is located made subsequent to Date of Policy, unless a liability or value has otherwise been permit a court to award attorneys'fees to a prevailing party Judgment upon me agreed upon as to each parcel by the Company and the insured at the time of the award rendered by the Arbnrator(s)may be entered in any court having lurisdicnon issuance of this policy and shown by an express statement or by an endorsement thereof attached to this policy The law of the slide of the land shall apply to an arbitration under the T41e 9 LIMITATION OF LIABILITY Insurance Arbitration Rules (a) If the Company establishes the title,or removes the alleged defect hen or A copy of the Rules may be obtained from the Company upon request encumbrance, or cures the lack of a right of access to or from the land or cures 15 LIABILITY LIMITED TO THIS POLICY POLICY ENTIRE CONTRACT the claim of unmarketabibty of title all as insured,in a reasonably diligent manner by any method including litigation and the completion of any appeals therefrom,it (a) This policy together with all endorsements, if any, attached hereto by the shall have fully performed its obligations with respect to that matter and shall not Company is the entire policy and contract between the insured and the Company be liable for any loss or damage caused thereby In interpreting any provision of this policy,this policy shall be construed as a whole (b) In the event of any litigation including litigation by the Company or with (b) Any claim of loss or damage, whether or not based on negligence and the Company s consent the Company shall have no liability for loss or damage which arises out of the status of the title to the estate or interest covered hereby or until there has been a final determination by a court of competent jurisdiction and by any action asserting such claim,shall be restricted to this policy disposition of all appeals therefrom adverse to the title as insured (c) No amendment of or endorsement to this policy can be made except by a (c) The Company shall not be liable for loss or damage to any insured for writing endorsed hereon or attached hereto signed by either the President,a Vice liability voluntarily assumed by the insured in settling any claim or suit without the President the Secretary,an Assistant Secretary or validating officer or authorized prior written consent of the Company signatory of the Company 10 REDUCTION OF INSURANCE REDUCTION OR TERMINATION OF is SEVERABILITY LIABILITY In the event any provision of this policy is held invalid or unenforceable under All payments under this policy, except payments made for costs, attorneys' applicable law, the policy shall be deemed not to include that provision and all fees and expenses,shall reduce the amount of the insurance pro tanto other provisions shall remain in full force and effect 11 LIABILITY NONCUMULATIVE 17 NOTICES,WHERE SENT It is expressly understood that the amount of insurance under this policy shall All notices required to be given the Company and any statement in writing be reduced by any amount the Company may pay under any policy insuring a required to be furnished the Company shall include the number of this policy and mortgage to which exception is taken in Schedule 8 or to which the insured has shall be addressed to the Company at 215 Columbia Street, Seattle, Washington agreed, assumed, or taken subject, or which is hereafter executed by an insured 98104-1511 and which is a charge or ben on the estate or interest described or referred to in Schedule A,and the amount so paid shall be deemed a payment under this policy to the insured owner ALTA OWNER'S POLICY—10-17-92 Standard Coverage PACIFIC NORTHWEST TITLE INSURANCE COMPANY, INC. A.L T.A OWNER'S POLICY SCHEDULE A Order No 407010 Policy No 1093-91727 Policy Date. July 7, 2000 Policy Amount $250, 000 00 at 14 08 p.m. 1 Name of Insured CITY OF KENT, a municipality 2 The estate or interest in the land described herein and which is covered by this Policy is FEE SIMPLE 3 The estate or interest referred to herein is at date of Policy vested in CITY OF KENT, a municipality 4 The land referred to in this Policy is described as follows The west 85 feet of the east 503 58 feet of the south 130 feet of the north 160 feet of the following described property The northeast quarter of the southeast quarter of Section 21, Township 22 North, Range 5 East, W M. , in King County, Washington, EXCEPT the south 340 feet; ALSO EXCEPT the west 660 feet, AND The south 130 feet of the north 160 feet of the east 80 feet of the west 985 feet of the northeast quarter of the southeast quarter of Section 21, Township 22 North, Range 5 East, W M , in King County, Washington. Standard Coverage PACIFIC NORTHWEST TITLE INSURANCE COMPANY, INC A.L T.A OWNER'S POLICY SCHEDULE B Policy No • 1093-91727 This policy does not insure against loss or damage by reason of the following GENERAL EXCEPTIONS. 1 Rights or claims of parties in possession not shown by the public records. 2 Easements, or claims of easements, not shown by the public record 3 Encroachments, overlaps, boundary line disputes, or other matters which would be disclosed by an accurate survey or inspection of the premises 9 Any lien, or right to a lien, for services, labor or material heretofore or hereafter furnished, imposed by law and not shown by the public records, or liens under the Workmen's Compensation Act not shown by the public records 5 Any title or rights asserted by anyone including but not limited to persons corporations, governments or other entities, to tide lands, or lands comprising the snores or bottoms of navigable rivers, lakes, bays, ocean or sound, or lands beyond the line of the harbor lines as established or changed by the United States Government 6 (a) Unpatented mining claims, (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof, (c) water rights, claims or title to water 7 Taxes or special assessments which are not shown as existing liens by the public records 6 Any service, installation, connection, maintenance, capacity, or construction charges for sewer, water, electricity or garbage removal 9 Indian tribal codes or regulations, Indian treaty or aboriginal rights, including, but not limited to, easements or equitable servitudes SPECIAL EXCEPTIONS As on Schedule B, attached. Policy No. : 1093-91727 SCHEDULE B Page 2 SPECIAL EXCEPTIONS 1 RIGHT TO MAKE NECESSARY SLOPES FOR CUTS OR FILLS UPON PROPERTY HEREIN DESCRIBED AS GRANTED IN DEED RECORDED. December 11, 1956 RECORDING NUMBER 4755698 GRANTEE: King County 2 Matters disclosed on a Short Plat recorded under King County Recording Number 9802179012, a copy of which is hereto attached END OF SCHEDULE B XX/vlc