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L026-11 - Original - Goodman Real Estate, Inc. - Lease with Option to Purchase - 09/30/2011
CITY CLERK CITY OF KENT KEN TT 4`h Avenue South Kent, WA 98032 WASHINGTON Fax 253-856-6725 , PHONE: 253-856-5725 Lease Agreement Cover Sheet Instructions This document is to be used In lieu of the Contract Cover Sheet SECTION 1 — CONTRACT PROCESSING AND TENANT SET-UP: All lease agreements must be signed by the Mayor or his/her designee and approved by the City Council. Lease amendments, extensions, renewals, and assignments may or may not require Council approval (contact the Law Department), but they must be signed by the Mayor. The City Clerk's Office will perform the following tasks associated with all lease agreements and amendments: • Assign a sequential lease agreement number based on starting with 001 and preceded with 'TL", e.g. L001. • Scan the Lease Agreement Cover Sheet, Lease Agreement (or Amendment) and, if any, related supporting documentation into the document imaging system. • Provide notification via e-mail to the Contact Person (Question 2), Law and Customer Services. The Lease Agreement Cover Sheet is to be completed for each existing and active and all subsequent lease agreements, lease amendments and assignments of lease. There is recognition that certain existing and active agreements and amendments may not incorporate new policies, e.g. commencement of the lease on the 1s' of the month or year. Those agreements and amendments will be addressed through subsequent agreements and/or amendments, if any. Contract Number: 40 -// 1. Responsible Department/Division: Economic & Community Development/Economic Development Page 1 of 5 2. Contact Person and Title: Kurt Hanson / Julie Pulliam Telephone Extension: 5706 / 5702 3. Tenant (Customer) Name: Goodman Real Estate 4. Tenant (Customer) Number: 394145 5. General Ledger Account Number: M20041.64190.9419 6. King County Tax Parcel Number: 982570-0520, -0505, 0515 7. Address of Parcel: 430 Smith Street, Kent WA 98022 S. Type of Lease: Lease w/Option to Purchase 9. Council Authorization Date: 9/Z0/2011 10. Mayor Signature Date: 9/30/2011 Mayor ProTem Jamie Perry SECTION 2 — LEASE DURATION AND IMPORTANT DATES: All lease agreements and amendments must reflect the lease start date, lease termination date and the duration of the lease. The lease agreement may also authorize the tenant to request an extension of the lease term, i.e. either "month to month" or for a defined period of time. The tenant must provide advanced written notice of the intent to exercise this lease option. A date certain lease start date must be established in the lease agreement and must be the first of the month. Commencement of certain leases may be predicated on certain actions by the tenant, e.g, installation of cellular tower equipment. In such instances, a reasonable fixed future date must be established in the lease agreement. 11. Lease Start Date: 1 /( /1/2011 12. Tenant Lease Option Renewal Notification Due Date: 10131 13. Lease Termination Date: N/A with option to gontmue 14. Lease Duration: 2 years with option to continue SECTION 3 — RENT DETERMINATION AND DUE DATE: Lease agreement must include provisions establishing the stated rent and, if over one year in length, modification of stated rent. Typically, rental increases are Page 2 of 5 based on changes in the Consumer Price Index. Example of possible contract language: Effective as of each anniversary of the Commencement date (the "Adjustment Date") by an amount equal to the greater of four (4) percent or the percentage increase in the CPI two (2) months prior to the Adjustment Date and the CPI for the month 12 months prior to the Adjustment Date. "CPI"means the Consumer Price Index - All Urban Consumers, (Seattle-Tacoma-Bremerton, WA), All Items, base penod 1982-84=100, Not Seasonally Adjusted, issued by the U.S. Bureau of Labor Statistics. 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 U.S. Bureau of Labor Statistics. 15. Rent: $100,000.00 for 2 year lease 16. Rent Due Date: 10/1/2011 for 2 years 17. Calculation of Rental Increase(s): N/A SECTION 4 - LEASEHOLD EXCISE TAX: Leasehold excise tax applies to the possession and use of publicly owned real property by a private sector individual, business or other organization. This tax is calculated based on 12.84 percent of the contract rent amount. See also Department of Revenue Leasehold Excise Tax Frequently Asked Questions and Answers (http:/Zdor.wa.gov/docs/Pubs/IndustSpecific/Leasehold.pdf). Contact the Customer Services Financial Analyst (LIDs/Receivables) or the Audit Manager regarding questions in this area. 18. Is this lease subject to leasehold excise taxes? ® YES (go to Question 19) ❑ NO, reason: 19. Are leasehold excise taxes for this tenant centrally assessed, i.e. directly collected from the tenant by the Washington State Department of Revenue? ❑ YES (attach written verification received directly from DOR or indirectly through the tenant, e.g. DOR notification letter) ® NO (go to Question 20) 20. Does Lease Rent include Leasehold Excise Tax? Page 3 of 5 (Leasehold taxes must be broken out on the invoice and coded: Business unit.32500.0303) ® YES Calculate the leasehold excise tax (Stated Rent divided by 1.1284) ❑ NO Calculate the leasehold excise tax (Stated Rent times .1284) SECTION 5 — APPLICABLITY OF UTLITIES: The Lease agreement must include provisions establishing responsibility for payment of utilities, including but not limited to electricity, natural gas, water, sewer, storm drainage, and garbage collection and disposal services. In certain instances, the utility service may not be applicable, e.g. septic system, or may not be provided by the City, e.g. Highline Water District service area. In all instances, City utilities will be billed through the Customer Services utility billing system. Other utilities paid by the City on behalf of the tenant, e.g. electricity or natural gas, will be invoiced to the tenant through the central accounts receivable system (JD Edwards). Electricity or natural gas charges may be established based on actual consumption, e.g. usage of a meter or by a reasonable amount established through appropriate financial analysis. Separate meters for measurement should not be established on City-owned or leased properties. The dollar amount of electric and natural gas charges must be included in the lease agreement (amendment) and should be subject to future modification based on appropriate methodologies, e.g. change in rate, etc. Contact Finance Customer Services for questions in this area, as well as ensuring that City accounts are transferred into the name of the tenant. 21. Applicability of Utilities — Check all that utilities that are affected and indicate provider (e.g. City of Kent), Account Number or basis of exclusion. ❑ Does Not Apply ❑ Water: City of Kent ❑ Sewer: City of Kent ❑ Drainage: City of Kent ❑ Garbage: Allied Waste ❑ Electricity/Natural Gas: PSE Ensure that Finance Customer Services is properly notified to ensure City utility account, if any, is recorded into the name of the tenant if so established in the Agreement. Ensure all other applicable charges are properly invoiced to the tenant. Page 4 of 5 SECTION 6 — MONETARY PENALTIES AND LATE INTEREST CHARGES: Lease agreement should contain provisions establishing penalties and must contain provisions establishing late interest charges. Late interest (also referred to as "finance charges") should be consistent with Chapter 3.10 of the Kent City Code, i.e. currently 1% of the amount of the unpaid balance or $2.00, whichever is greater, if not paid within 30 days from the due date. 22. Monetary Penalties: N/A doesn't apply lease is paid up for 2 years with option to renew 23. Late Interest: SECTION 7 — OTHER LEASE CONSIDERATIONS: Special lease considerations, e.g. non-monetary rent, etc Page 5 of 5 LEASE (with Option to Purchase) by and between City of Kent,as Landlord and Goodman Real Estate,Inc.,as Tenant 0 { d TABLE OF CONTENTS Page 1 Incorporation of Recitals:Definitions ........ . ....................................... ............................. ............. 2 2. Leased Premises . . .. . . ... ....... .... ........................ ................................... .. .................. . ..6 ALeased Premises. .......................................................................................................... ..6 B Title to and Condition of Existing Improvements and Leased Premises.. .................. ...........6 C Temporary Construction Easement . ..... . .. . ..... . ........... ... ........... ................................6 D. Seller Disclosure Statement . . .. ............................................................................. .........7 E. City's Reserved Rights............ . . . . .. ....... ................ . .................... .. . . .. ..7 3. Term . . .. . .. ............................................. . ... . ... .... . .. . ............ ........... . . ............. ..............8 AInitial Term ............. .. ...... .. . ... ... ... . ... .... ..... ...... ........... ............. .....a B Option to Extend Because of Appeal of Governmental Approvals....................... ...................8 C Option to Extend for Force Majeure Events . ..................... ......... .......... . . . . .. . . 8 D Economic Impossibility. . . .... .. ......... .. .......... ............ .. .. ................... ........... ......... .......8 E. Outside Expiration Date......................... ..................................................................................9 F. Developer's Termination Right . . .... .......... ..................... .................................... .. . 9 4. Rent....... . . .... ....... .. . .. . . ...... ................ . .. . .... . . . . . .............. ............... ... .9 A. Prepaid Rent .......... ...... ........ ....... ......... ........ .... . ... ... . ....... ....................................9 B. Leasehold Excise Tax................................................. ............................................................ .9 C Additional Rent ...... ......................... . ..... .... .................I.......9 D. Absolute Net Lease............................ . .. . . . ... ....... . .. ....... . ......... ...............9 5. Taxes and Utilities............. ............................. ..... .... .... .......... .. ................................ .... ..... ...10 A. Payment of Taxes by Developer........................................... ................................. .......... . .10 B. Personal Property Taxes............. ............... . ... . . . ... . . ... . . ........... ..... ...10 C. Utilities .. . .. . ............ .......... ................ ....... . .... .... . .. .... ......... .. 10 6. Demolition of Existing Improvements ......................... ..... . . ..... .... . ..... ....... .I..... . . ...10 7. Use of Leased Premises, Permitted Use.. ......................... ..... .. ... . .. .... ... ... ....................... ..11 A. Use of Leased Premises; Pennitted Use ............................. .. ............................................. . I 1 B. Quiet Enjoyment . . . ....... ..... ........................... . .... . ....... ...I I C. No Insurance Cancellation......................... .. . . .. . .................................. ... .. ......... 12 D. No Unlawful Use.Waste,Nuisance or Damage ............................................................... ... 12 ECompliance with Laws . ... ......... . . ... ........... .......................... .............. ... ..... .. 12 8. Liens........... .... . . ..................... ....................... .. .......................... ......... ......... . . ....12 ACovenant Against Liens................................................ ........ .......................... ... ........ . .. 12 B. Covenant to Remove Developer Liens... . . ...... ....... ... . ...................................... . . .13 C. Disclaimer of Liability by City.. ... .. ........ ... .. ....... ............... ............................ . .... .....13 9. Overall Description of Project; Conceptual Plans;Land Use Approvals; Permit Summary...... ....13 A. Description of Overall Project, Conceptual Plans. ........ ... . 13 B. Description of Option Property, Boundary Line Adjustment....................... ........................ .13 C. Minimum Design Criteria for the Project . .. . ...... ........ ......... ................................. 14 D. Land Use Permits and Environmental Approvals ........................ ................................... .....14 E. Vesting ....................................................... ...... .15 ............. . ................. . ...... ....................... 10. Predevelopment Activities with Respect to the Project... .............................. .. .... . ....... ...... ...15 A Schedule for Project Development . ...... ................. ....................... ... .... ... ...... .... ........15 -i- P V0399 DR5130399 31R 09/30/11 B Design Review and Approval . ......... . ....................... ................ . ....15 C Waiver of City of Kent Multifamily Property Tax Exemption.. . ..... .... ......... ....... . . ....16 D. Application and Issuance of Construction Permits for the Project. ..................................... ..16 11. Insurance and Indemnification..... . . .. . ................. . . . ... . ..........I... .. .. . ...........18 A. Insurance. .. .. . .. ...... . . .. ...................... . . . . . .. ............ .... .. ... . . ...............18 B. Indemnification......... . . ... ................... .. . .. . ................... .... ... . .. ........I........19 12. Damage and Destruction; Condemnation of the Property ....... ........ .... ....... ..... ............. . .. ......20 A. Damage and Destruction during the Lease Tenn .. ... . ... ................................................. 20 B Entire Condemnation... ............ . .. .. ............. .... .. ...................................... ................. .. 21 C. Partial Condemnation ................................... .... ..................... ... .. ............... .. I...... .21 13. Assignment, Subletting. . . . ......... . . .. .................. ......... .................. ....... .. . . . .. .......... .. .21 A. Assignments and other Transfers During Tenn of Lease..... . .. . ... . . 21 B Transfers of Interest in Developer. . . .. . ................ . ....................... ........ .............. .......... 21 C. Definition of Transfer . . . ................................... ....... ............................................. 22 D. Transfers Pursuant to Approved Financing Plan .......... . ........................ . .............22 14. Title to Option Property .... ......................... . ... ...... ... . . ... . . ... . .... . ..............22 A Title to Option Property.......... .................... ...... ...... .. . ............................................... 22 BTitle Insurance .. .. ...................................... .. ...................... . ................................... . 22 C. Title Review . .......... . . . .... ............ ............ . ............22 15. Representations.. . ........... ...... .. . I ............. .....23 A City Representations... .................. .. ... ... ..... ....... ..... ... ........... . . . .............. .I..... ...23 B. Developer Representations .......................................................... .............. .................... . ..25 16. "AS-IS" Sale... . . ...... . . ...... .. . .......... .. ...........26 17. Conditions Precedent to Developer's Exercise of Option to Purchase the Option Property..............26 A Approval of Financing Plan for the Project .. ... .. .. . .... . .. .... ...... . . . ..27 B Funding of Construction Loan and Equity Investments....... . . . ........ .. ..... ............ ........ 27 C. Discretionary Permits .... . ..... . ..... . . . .. ....................................................... 27 D Construction Permits .. ... . .. .. . ..... ....... .. .... .. .28 E. Boundary Line Adjustment Completed............ .. .. .. . . ..... .... . . . . .... . .......... 28 F. Financial Assurances ... ......... ... ........ ............ ............ ...................................................... 28 G Construction Contract.... ...... ........ ........... ......... .... .. ................................ .. . . 28 H. Completion Guaranty ......... . .... ..... ... .. ........... ............... .. ............. ........... . ........ 28 I. Compliance by Developer. ...................... ............................ ......... 28 ..................................... . J. Correctness of Representations.............................................. ................................ .............. 28 KNlo Bankruptcy .. .. .. .. .. .....I................ ... .. ... ...................I ....... ....I ..... ........... 28 18. Developer's Conditions Precedent to Closing of Purchase of Option Property. . .... . .......... .. .. .28 A. Compliance by City................... ..................... ........... . . ......... .............. .................... .... 28 B. Correctness of Representations. ...... ............ ............. .......... . ............................ ............. 29 CCondition of Property . ...... . ................ ............... ........... ................................. .......... 29 D. Title Policy.............. ............................................................................................................ . 29 EDiscretionary Permits........... .......................................... .. . ....................... ...................... 29 FConstruction Pennits ....................................... ................... ....................... ........... .........29 19. Option to Purchase Option Property ...... ......... . ...................... .............................................. . .29 AOption to Purchase. . . .... ............ ..... . .. ................... ........................................................ 29 B. Exercise of Option. . . .... ... ........... .................. .. ......... ................................................. .29 C. Payment of Base Option Price. . ...... ............ ................. ... . ............ ............ .................. . 29 _n- P=399 DRS=399 31R D9130l11 DContingent Pa-,Meat Price ..... ... ... .. . .............. . . .......... . . . .... I .............. 29 20. Closing of Purchase of Option Property....... .. . ....... .. . . .. ..... . .... ....... ......... .. . . .....30 A. Closing Procedures . .......... . .......... ...I ... . . .. .. .. ..... ....... ....... ........ .30 B. Delivery by City ... .......... .... ....... ...................... ... ..................I ................... ........ .30 C. Delivery by Developer... ........ ..... ....... ... .. . . .. .. . . .. . . ... . .. . . . ..... .............. 31 D. City's Closing Costs ..... .... ............ ..... ........ . . . .... ......... . .............. . I. . ............31 E. Developer's Closing Costs .................................. ....................................... ..................... 31 F. Prorations ... ........................ . ........................ . G. Recordation and Delivery of Documents . .. .......... ....................... .......................... ... . 31 HNotification; Closing Statements... . ... ......................................................... . ................... 32 IPossession......... . ........... . . ........ .. ................... .. . .......................................................32 21. Default . . . . ..... ... ... . ......... ... . .............. . ......... . . ...32 A. Developer Default............... . ... . ........... ........... .. ............ ..... .. .......... ............. ... .32 B. City Remedies upon Developer Event of Default .......... ................................................... 33 C. City Right of Repurchase.... ... .. .......... ... ....................... ... ................... .............. . .. ..33 DCity Default; Remedies...... ............................ ..................... . . .............. ... .. .......... ...... ....33 E Waiver of Consequential and Punitive Damages ....................... ............................................34 F. Rights and Remedies Cumulative...... . ........ ... .......... ..................... ......... ................34 22. Hazardous Substances . ........... . ...... . ............ .............. .......... .. ....... ... ......... .. ....34 23. Time of the Essence ..... .. ........... ..... .. ......... .. . .... ....... . .. .... . ....... . . . .. . .............34 24. City's Right to Enter the Leased Premises........... ... ... ............ ........ ............. .. . 35 A. Condition.. .. . ........ ....................... ................ .......... ................. ...35 B. Notices.. ......... ....................... ........ .. . ................... ................. ..35 25 Notices. ............. .... .... . ........ . .. ......... .. .............. ........... ........... .. . .35 26. Surrender .. ....... . . . ........ . .......... . .... . ................................ . ... .... .... .. . .36 ASurrender............. ... .............................. . ...... ............................. ......... ........... . ............... 36 BFailure to Surrender ......... .. ............................................................................................ .. .36 C. Holding Over.. .............. . .. ........... . . ......... .................... . ................................ 36 27. Miscellaneous . . . . . ........ ... . ................................... ............... .. .... I .................... . . . . 36 AEntire Agreement................... . .......... ........................................ ........... ........ ................. .. 36 BNon-Waiver.................................................................... ...................................................... 36 CConstruction . ... .... ..... ................... ...... ......................... ........... .. ......... . D. Severability . .. ....... .......... .................................................. .......... . ... .... .... .... ....... 37 E. Neutral Authorship..... ...... .............................. ......... .................................. ................... .... 37 F. Nature of Relationship ... ............................. . ................. ..................... .. .. ......... .37 GNo Brokers .................................... ................. .... .......37 .............. ...... .. . ........ H. Survival ................ ............................................................................... ...37 ............................ I. Recording of Memorandum ...... . ................. .................. . ...... ... ............. .................. 37 J. Covenants to Run with the Land ................... . .................. .................. ................ .. ....... 37 K. Nondiscrimination............... ................................................................................................ . 37 LNo Third Party Rights. ..... .... ... ........ ................................................................... ........ 38 M Non-Waiver of Governmental Rights.............. ................... . .............................................. 38 N. Further Assurance................. .... . ....................... .................................................... ........ 38 O. Authority ... .. ... . . . . . ........................................ .................38 .......... .................. ... ....... P. WAIVER OF JURY TRIAL . .. ....................................................................... ......................38 Q. Conflicts of Interests.. . ... .................................... .......................................... ................. 38 R. Non-Liability of City Officials Employees, and Agents..................... ... . ... ........ ............38 Ill- P 120399_DRS120399 31R 0913D/11 SApplicable Law.... .. ........ ... ... . ................ .................. ........... ...........38 TCounterparts . ........ ... ......... . . ... .......... .. . ............... .... . .... ..... ... ........ . . ..38 UAttornevs' Fees . .......................................... ................................... .. .............. ............. 39 EXHIBITS Exhibit A — Legal Description of Property Exhibit B — Legal Description of Leased Premises Exhibit C — Legal Description of Option Property Exhibit D — Map of Property Exhibit E — Kent City Center Design Principles Exhibit F — Planned Action Ordinance Exhibit G — Development Milestones Exhibit H — Conceptual Plans for the Project Exhibit I — Bargain and Sale Deed Exhibit J — Temporary Construction Easement Exhibit K — Contingent Payment Agreement Exhibit L — Public Parking Easement Exhibit M — List of Permitted Exceptions Exhibit N — Completion Guaranty Exhibit O — Permit Summary Exhibit P — Pro Forma Title Policy -iv- P=399 DR=0399 31R D9130111 LEASE (with option to purchase) This LEASE (WITH OPTION TO PURCHASE) ("Lease' ) is made and entered into as of _. 2011 (the "Effective Date") by and between the CITY OF KENT, a Washington municipal corporation, hereinafter called -City" and Goodman Real Estate, Inc., a Washington corporation(hereinafter called -Developer') with reference to the following facts. RECITALS A. The City has planned a revitalization of its downtown area to create a high quality comprehensive integrated retail. commercial and residential anchor for downtown, provide additional housing downtown in close proximity to the Kent commuter rail and bus transit center, increase pedestrian actiN ity downtown and thereby directly and indirectly improve public safety in the downtown retail core, improve the economic vitality of the City. expand and dnersify the City's tax base, increase tax revenues,create jobs and thereby enhance other City investments and assets and achieve multiple City objectives B The City adopted the Kent Comprehensive Plan, the Downtown Strategic Action Plan and rezoned certain real property previously designated as Downtown Limited Manufacturing (-'DLM") within downtown Kent to Downtown Commercial Enterprise ("DCE") to recognize the variety of functions downtown Kent will be expected to provide as a designated urban center pursuant to King County county-wide planning policies for population, employment and services Li 2002 pursuant to RCW 43 21 C. the City adopted that certain Planned Action Ordnance No 3608 (the "PAO"), for a site consisting of approximately 25 acres in size bounded by James and Harrison Street, 4th Avenue and V Avenue in downtown Kent (the `Planned Action Area"), which provides that environmental review of a Planned Action Project within the Planned Action Area shall be based on the environmental analysis contained in the Kent Station Planned Action Supplemental Environmental Impact Statement (the "SEIS')as defined in the PAO. C. The City is the owner of certain real property located at 430 West Smith Street in the Downtown Commercial Enterprise Zoning District and within the Planned Action Area and more particularly described on Exhibit A attached hereto and by this reference incorporated herein (the "Pro e ") The Property is located immediately adjacent to the City's Town Square Plaza park The City has determined that the portion of the Property hereinafter defined as the "Option Property" is surplus to its needs and on March 7, 2011 the City issued a Request for Proposals to those finalists who responded to the City's earlier Request for Qualifications dated November 10, 2010 seeking proposals from development/design teams for redevelopment of the Option Property. D. As part of the selection process for the developer/design team,Developer and its architect Studio Meng Strazzara presented a proposal for redevelopment of the Option Property with a mixed-use development consisting of approximately 164 market rate, all-ages. urban-sty le rental apartments, at least 3700 square feet of ground floor retail located at the intersection of 41h Avenue North and West Smith Street, and approximately 156 parking stalls of which a minimum of 35 parking stalls would be available for free, short-term public parking during normal business hours (i.e., 9 a in. to 5 p.m.), seven days a week(collectively. the"Project") E. Developer has requested that City enter into a two (2) year lease (subject to extension under certain conditions as provided herein) of a portion of the Property defined herein as the "Leased Premises"to enable Developer to determine the feasibility of the development of the Project. F City is willing to lease a portion of the Property to Developer at the rent and other terms and conditions set forth below and is willing to grant Developer an option to purchase the Option Property subject to satisfaction of certain conditions precedent. at an option price and on other 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 1. Incorporation of Recitals, Definitions. Each recital set forth above is incorporated into this Lease as though fully set forth herein As used herein, the following terms shall have the following meanings "Additional Rent'" means any monetary sum required to be paid by Developer to the City under the provisions of this Lease(other than Rent) "Base Option Price" means the portion of the purchase price for the Option Property payable to City in cash on the Closing Date as desci ibed in Sections 19 and 20 of this Lease "Business Day" means a day other than Saturday. Sunday, any federal or Washington State holiday, any date on which banks located to the state of Washington are authorized or obligated to close or any date on which the King County Recorder's office is closed. "City"means the City of Kent, a Washington municipal corporation. "Closing"' means the date when the Developer and City have delivered to Escrow Agent all of the documents and funds required to be delivered by them to complete the purchase and sale of the Option Property (if Developer exercises its Option) in accordance with the provisions of Sections 19 and 20 hereof "Closing Date"means the date on which the Closing occurs. "Commencement of Construction" means commencement of excavation for foundations of buildings or other structures to be constructed on the Option Property as part of the Project. "Construction Lender" means a state or national bank, insurance company, pension fund or other major financial institution which has agreed to make a construction loan to Developer to construct the Project and which has a long term credit rating of at least "A" from either Moody's Investors Services Inc. or Standard & Poor's Financial Services LLC unless otherwise approved by City as part of the Approved Financing Plan for the Project. "Construction Permits'' means the civil construction permit and building permit for the Project. i "Contingent Payment" means the Demolition Costs, as adjusted and payable as provided in the Contingent Payment Agreement attached hereto as Exhibit K. "Demolition Costs" means Developer's costs of demolishing the Existing Improvements as defined in Section 6,not to exceed Three Hundred Fifty-Two Thousand Dollars($352,000). -2- P @0399 0RS120399 31R D9130111 "Developer Parties" means individually and collectively, Developer's agents, employees, consultants, contractors and subcontractors. "Discretionary Permits" means the City's downtown design review approval process and any other permit other than Construction Permits required to build the Project "Economic Impossibility' means that at the time that Developer is prepared to exercise the Option (1)the interest rates offered by financial institutions for multifamily construction loans for multifamily projects comparable to the Project utilizing the one month L113OR (London Interbank Offered Rate) rate as determined from Reuters Screen LIBOR01 Page or any successor thereto, increases to 400 basis points in excess of the one-month LIBOR rate, or(2)the one-month LIBOR rate increases to 2% or more or (3)the interest rate payable on direct obligations of the United States Treasury having a maturity of ten (10) years is five percent (5%) or greater Developer's notice of Economic Impossibility shall be accompanied by letters from at least two financial institutions with credit ratings that would L satisfy the definition of a Construction Lender under this Lease declining to provide construction financing to the Project because of a material adverse change in the real estate or financial markets (including, but not limited to the secondary mortgage market) that would cause institutional min estors to regard the loan or any mortgage security derived in whole or in part from the loan as an unacceptable investment due to overall market volatility and not due to financial risk of the Project or the financial qualifications of Developer. "Effective Date" means the date this Lease has been fully executed, acknowledged and delivered by City and Developer, and City has issued a demolition permit and any othei necessary permits and approvals for demolition of the Existing Improvements. "Environmental Laws" means, as amended from time to time, the Federal Resource Conservation and Recovery Act of 1976, 42 U S.C. § 6901 et sec , Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980. 42 U.S C § 9601 et sec . Federal Hazardous Material Transportation Control Act, 49 U S C § 1801 et sea., Federal Clean Air Act, 42 U S C. § 7401 et seq, Federal Water Pollution Control Act, 33 U.S C § 1321, Federal Water Act of 1977, 93 U S C § 1251 et sec . Federal Insecticide, Fungicide and Rodenticide Act, Federal Pesticide Act of 1978, 7 U S C § 136 et sec , Federal Toxic Substances Control Act, 15 U S C § 2601 et seg. Federal Safe Drinking Water Act. 42 U S C § 300f et M, Washington Water Pollution Control Act, RCW ch 90 48. Washington Clean Air Act, RCW ch 70.94, Washington Solid Waste Management Recovery and Recycling Act, RCW ch 70 95, Washington Hazardous Waste Management Act, RCW ch 70 105. Washington Hazardous Waste Fees Act. RCW ch 70 95E, Washington Model Toxics Control Act, RCW ch 70.105D. Washington Nuclear Energy and Radiation Act, RCW ch 70 98, Washington Radioactive Waste Storage and Transportation Act of 1980, RCW ch. 70 99, Washington Underground Petroleum Storage Tanks Act, RCW ch. 70.148 and any regulations promulgated thereunder "Escrow Agent" means First American Title Insurance Company which shall provide escrow services and issue the Title Policy to be delivered to the Developer in connection with the Closing. "Events of Default*'has the meaning set forth in Section 21 of this Lease. "Existing Improvements" means that portion of any above-grade unfinished parking structure currently located on the Leased Premises. "Expiration Date" means the earliest of. (i)the date which is two (2) years after the Effective Date(subject to extension in accordance with the provisions of Section 3 below); (ii)the date on -3- P T0399_DRSQ0399_31R 09/30/11 which this Lease is terminated as a result of the Developer's exercise of its Option to purchase the Option Property and pa}ment of the Option Price pursuant to the provisions of Sections 19 and 20 below, or (iir)any date on which this Lease temmnates in accordance with its terms, provided, however, that in no event shall the Expiration Date be a date which is later than five(5)years after the Effective Date. "Final Completion' or "Final Completion of the Project" means that (a) construction of the Project is substantially complete as evidenced by a certificate of substantial completion issued by the Project architect, and (b) the City has issued a temporary certificate of occupancy for the Project `Force Majeure"means strikes,war. insurrection or terrorism, labor troubles, acts of God or nature, periods of inclement weather that unreasonably impact demolition of the Existing Improvements or construction of the Project, fire, flood, earthquake or other unavoidable casualty, or any other cause beyond the reasonable control of a party to this Lease, other than delay resulting from the Developer's failure to comply with any material term or provision of this Lease because of unavailability of funds to pay for (a) demolition of the Existing Improvements (following the Crry's issuance of a demolition permit) or(b)the design and permitting of the Project. "Governmental Approvals" means all land use and other permits, licenses and approvals necessary to either (a) demolish the Existing Improvements, or (b)build the Project on the Option Property "Governmental Authority" means any court or tribunal in any jurisdiction within the United States or any federal, state, tribal, municipal or local government or other governmental body, agency, authority, department,commission, board,bureau. or instrumentality "Hazardous Substances" means anv material, waste, substance, industrial waste, toxic waste, chemical contaminant, petroleum, asbestos, polychlorinated brphenyls or other substances regulated or classified by Environmental Laws as hazardous, toxic or lethal to persons or property "Initial Term"means the earliest of (r)the date which is two (2)years after the Effective Date; (ir)the date on which this Lease is terminated as a result of the Developer's exercise of its Option to purchase the Option Property and payment of the Option Price pursuant to the provisions of Section 20 below, or(in) any date on which this Lease terminates in accordance with its terms "KCC"means the Kent City Code as amended from time to time. "Laws" means any constitution, statute, ordinance, regulation, rule, resolution, judicial decision, administrative order or other requirement of any federal, state, county, municipal or other Governmental Authority having jurisdiction over the parties or the Leased Premises, or both, in effect either at the time of execution of this Lease or at any time during the Tenn, including without limitation, any regulation or order of a quasi official entity or body (", board of fire examiners or public utilities) including, but not limited to Environmental Laws and all rules, laws and regulations issued thereunder, as the same may be amended from time to time. "Leased Premises" means that portion of the Property which will be leased to the Developer pursuant to this Lease which is legally described on Exhibit B attached hereto and by this reference incorporated herein and which is depicted on the site plan attached hereto as Exhibit D and by this reference incorporated herein. The "Leased Premises" will include a temporary construction easement for the Tern of the Lease over and across that portion of Parcel C as depicted on the site plan attached hereto as Exhibit D and more particularly described in Section 2.0 below. -4- P 12039E DR$=399 31R 09130/11 "Liens" means any lien. charge. secunty, interest or encumbrance accruing or imposed upon the Leased Premises for the period commencing on the Effective Date "Minimum Required Project Elements" means those elements of the Project defined and described in Section 9 hereof "Option" means the Developer's option to purchase the Option Property as provided in Section 19 of this Lease "Option Property" means all of Parcels A and B and a portion of Parcel C. City of Kent Lot Line Adjustment No LL-2005-37 which is legally desci ibed on Exhibit C attached hereto and by this reference incorporated herein and which is depicted on the site map annexed hereto as Exhibit D '"Permit Summary" means that certain non-binding, informational summary prepared by the City for the purpose of outlining the major pen-nit processes applicable to the Project and attached hereto as Exhibit O "Rent"means collectively, Rent and Additional Rent. "Rent" means the amount payable by the Developer to the City pursuant to Sections 3 and 4 below for the lease of the Leased Premises. "Requirements of Law" means all requirements relating to land and building construction (including those specifically applicable to the contemplated use of the Option Property for the Project), including, without limitation, planning_ zoning. subdivision, the American with Disabilities Act as amended, envnonmental, air quality, flood hazard. fire safety, accessibility and other governmental approvals, pennrts, 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 covenants, conditions and restrictions which apply to and/or affect the design, construction, existence, intended use, operation and/or occupancy of the Option Property. the Leased Premises or any part thereof "Taxes" means all real and personal property taxes. surface water management charges and assessments (including assessments for public improvements), charges for public utilities which if unpaid may become a lien on the Leased Premises, leasehold excise taxes, other excise taxes, levies, sales, use and occupancy taxes, any tax or charge assessed against the Taxable Rent as defined in RCW Chapter 82 29A or fair market value of the Leased Premises and any taxes levied or assessed in addition to or in lieu of, m whole or in part. such taxes, assessments or other charges (including any leasehold excise taxes which may be from time to time levied on the leasehold estate created by this Lease) and all other governmental impositions and charges of every kind and nature, general and special, ordinary and extraordinary, foreseen and unforeseen of every character(including interest and penalties thereon) which at any time from and after the Effective Date of this Lease may be imposed, levied upon or assessed against or w hich arise with respect to or constitute a hen upon the Existing Improvements or the Leased Premises(or any part thereof),the leasehold estate created by this Lease or any part thereof, or any estate, right or interest therein, or any occupancy, use or possession of or activity conducted on the Leased Premises or any part thereof. "TCE" means the temporary construction easement in the form attached hereto as Exhibit J. "Term" means the period beginning on the Effective Date and ending on the Expiration Date. -5- P M399_DRS=399_31R 09/30/11 "Title Company" means First American Title Insurance Company, which will be issuing the Title Policy. "Title Policy"has the meaning set forth in Section 14.B below. "Utrlrtres" means all public or private utilities and services furnished to the Leased Premises including, without limitation, gas. electricity, water, sewer, garbage collection and telephone and cable service. excluding any utilities or services furnished to or serving any portion of the Surface Parking Area, if any. 2. Leased Premises. A. Leased Premises. City, in consideration of the rents herein reserved and the terms, covenants, and conditions of this Lease to be kept and performed by Developer, hereby demises and leases to Developer, and Developer hereby hires and leases from City the Leased Premises B. Title to and Condition of Existing Improvements and Leased Premises Developer has had an opportunity to investigate the Existing Improvements and the Leased Premises and is knowledgeable and familiar with the present condition of title and the present condition and state of repair of the Existing Improvements and Leased Premises. The City acquired title to the Property (including the Existing Improvements constructed thereon) by trustee's deed recorded in the official records of Bing County, Washington wider King County Recording No. 20101001001190 (the "Trustee's Deed") City makes no representation or warranty as to ownership of any personal property or equipment which may be located on or within the Existing Improvements The City makes no other representations or warranties as to title to the Property or the Existing Improvements. Developer shall have the right to obtain a leasehold owner's policy of title insurance at its sole cost and expense as of the Effective Date and an owner's policy of title insurance from the Title Company with respect to the Option Property in accordance with the provisions of Section 14 hereof The Leased Premises (including the Existing Improvements) are leased to Developer by City in their present condition and state of repair on an "AS IS" basis and without any representation or warranty of any kind by City express or implied, other than as set forth herein, and subject to (a)the existing condition of title (except for City's obligations with respect to certain title exceptions as set forth in Exhibit M), (b)the Existing Improvements, and (c)all applicable Requirements of Law now or hereafter in effect Developer acknowledges that the Existing Improvements located on the Leased Premises consist of a partially completed parking garage constructed by parties other than the City which has been abandoned since 2007, and that as part of the consideration for this Lease, Developer has agreed to demolish the Existing Improvements Developer acknowledges receipt of a copy of a structural report regarding the Existing Improvements prepared by Swenson. Say Faget dated February 11, 2011 (the "Structural Report'). City makes no representations or warranties as to the accuracy or completeness of such Structural Report, the current condition of the Existing Improvements or the sufficiency of the Structural Report for Developer's intended development of the Option Property, and Developer shall have the right to undertake an independent investigation of the present condition and state of repair of the Existing Improvements and Leased Premises Developer shall have the right to use,remove, sell or dispose of all Existing Improvements, including any and all personal property and equipment located therein. at Developer's sole cost and expense Developer hereby accepts the Leased Premises subject to all of the foregoing and without any representation or warranty by City, express or implied, except as set forth herein, and expressly without recourse to City as to the physical condition of the Leased Premises, the Existing Improvements or the suitability of the Leased Premises or the Option Property for Developer's intended purposes C Temporary Construction Easement. The Leased Premises shall include a temporary construction easement in favor of Developer over and across that portion of Parcel C as -6- P 120399 DRSM399 31R D9130/11 depicted in Exhibit D during the Term of this Lease on the terms and conditions set forth in the Temporary Construction Easement attached hereto as Exhibit J (the "TCE") The TCE shall be executed contemporaneously with this Lease and shall continue in full force and effect throush the Tenn of the Lease unless earlier terminated by mutual agreement of the parties. V D. Seller Disclosure Statement. Since this Lease contains an option to purchase commercial real estate, and to avoid any argument that delivery of a real property transfer disclosure statement in the form set forth in RCW 64 06.013 is required, Developer acknowledges receipt of a completed real property transfer disclosure statement executed by City dated September 30, 2011 Developer further acknowledges and agrees that in the event Developer exercises the Option to purchase the Option Property pursuant to Section 19 hereof. City shall not be required to deliver Developer another real property transfer disclosure statement solely by reason of the exercise of such Option. Nothing contained herein waives the City's obligation to amend the real property transfer disclosure statement under RCW 64 06 040 As provided in RCW 64 06 013(2), the real property transfei disclosure statement shall be for disclosure purposes only and shall not be considered part of this Lease or the Option to Purchase set forth in Section 19 hereof. E. City's Reserved Rights. City expressly reserves the right to use that portion of the Leased Premises cross-hatched in blue on the map annexed hereto as Exhibit D (the "Surface Parkin Area') during the Tenn of the Lease for short term public parking and other uses that do not interfere with Developer's access to the Leased Premises, its obligation to demolish the Existing Improvements on the Leased Premises or to conduct its due diligence investigation of the Leased Premises or any other activities authorized under this Lease or the TCE The City shall deliver an executed tennination of the Surface Parking Easement to the Escrow Agent for recording no later than the Closing Date City, m addition to its indemnification obligations set forth elsewhere in this Lease, shall indemnify, defend and hold Developer harmless from all costs, claims, actions and liabilities of any kind associated with or related to public use of the Surface Parking Area but only to the extent such costs, clauns, actions or liabilities arise from the negligent act or omission of City In the event that Developer determines that it is necessary to limit public access to the Surface Parking Area in order to demolish the Existing hmprovements or to conduct its due diligence investigation of the Leased Premises or any other activities authorized under this Lease, Developer shall provide City with at least two (2) days prior written notice of its need to restrict access to the Leased Premises, and shall identify that portion of the Surface Parking Area needed To the extent reasonably possible, Developer shall locate construction staging areas for the demolition contractor and contractor and employee parking on portions of the Leased Premises other than the Surface Parking Area. Developer shall use all commercially reasonable efforts to minimize disruption of use of the Surface Parking Area by members of the general public, limit the area of the Surface Parking Area needed for such demolition work or due diligence investigation of other activities and shall promptly finish any work which necessitated use of the Surface Parking Area. City and Developer shall cooperate in good faith in the preparation of a construction management/due diligence plan so as to minimize disruption to the public's use of the Surface Parking Area Developer shall provide temporary signage showing the location of that portion of the Surface Parking Area which remains available for public parking, maintain pedestrian and vehicular access to the Surface Parking Area and install construction fencing or other construction barricades as may be necessary to protect public safety and property damage to adjoining properties If reasonably necessary for the safety of persons or property. Developer shall have the right, with the prior written consent of the City, to temporarily close the Surface Parking Area to perform necessary due diligence work or to demolish the Existing Improvements Developer shall repair any damage to the Surface Parking Area caused by Developer or any of the Developer Parties during such demolition work or resulting from such inspection. studies and tests which interferes with the public -7- P=399 DRSi20399 31R 09/3MI - 1 parking use, normal wear and tear excepted, and shall remove all debris, equipment and vehicles from the Surface Parking Area promptly following completion of its demolition or due diligence activities 3. Tenn. A. Initial Term This Lease shall commence on the Effective Date and shall expire on the second (2°d) anniversary of the Effective Date, unless sooner terminated as provided herein, or unless the Initial Tenn is extended pursuant to the remainder of this Section 3 B Option to Extend Because of Appeal of Governmental Approvals. So long as there exists no Event of Default by Developer under this Lease and there is no event that with the giving of notice, the passage of time, or both, would constitute an Event of Default by Developer under this Lease, Developer shall have the right to extend the Initial Term of this Lease and its Option to purchase the Option Property, for up to twelve (12)months without the payment of additional Rent if Developer has not satisfied all of the conditions precedent to Developer's exercise of its Option to purchase the Option Property solely because of a timely appeal to either (i)the City's action with respect to the Developer's application for downtown design review, or (ii) City's approval of the issuance of the Construction Permits for the Project, provided. however, that if any such appeal is not finally concluded within twelve (12) months following (a) City's action with respect to Developer's application for downtown design review, or (b) City's approval of the issuance of the Construction Permits, as applicable, whichever first occurs, then the City shall have the right to terminate this Lease (and the Option to Purchase the Option Property set forth ru Section 19) without liability to Developer upon sixty(60) days prior written notice to Developer. C Option to Extend for Force Majeure Events. If Developer has been unable to satisfy all conditions precedent to Developer's exercise of its Option to purchase the Option Property prior to the Expiration Date solely because of the occurrence of one or more Force Majeure events, then provided (i)that there is no Event of Default by Developer under this Lease and no event that with the giving of notice, the passage of time or both, would constitute an Event of Default by Developer, and (ii) Developer provides City with written notice and evidence in form reasonably satisfactory to City of the occurrence of such Force Majeure event no later than sixty(60) days prior to the then Expiration Date, Developer shall have the right to extend the Term of this Lease and its Option to purchase the Option Property for the duration of such Force Majeure event not to twelve (12) months in the aggregate upon payment to the City of additional annual rent in the amount of Fifty Thousand Dollars ($50,000) (prorated for the duration of the extension term) (together with applicable Leasehold Excise Tax) prior to the Expiration Date,which additional Rent payment shall be nonrefundable and fully earned once paid D. Economic Impossibility If there is no Event of Default by Developer under this Lease and no event that with the giving of notice, the passage of time or both, would constitute an Event of Default by Developer and the Developer has met all development milestones set forth in Exhibit G to this Lease and all conditions precedent set forth in the Lease to Developer's exercise of its Option to purchase the Option Property prior to the Expiration Date other than the condition set forth in Section I TA of this Lease because of Economic Impossibility, Developer shall provide City with written notice and evidence in form reasonably satisfactory to City of Economic Impossibility no later than sixty (60) days prior to the then Expiration Date The City shall have the right, at its option upon written notice delivered to Developer within sixty (60) days thereafter to either (a)grant Developer an extension for up to two (2) years upon Developer's payment of additional rent of Fifty Thousand Dollars ($50,000) (together with applicable Leasehold Excise Tax) per year for each twelve (12) month extension payable prior to the Expiration Date and the first anniversary thereof, which additional rent payments shall be nonrefundable and fully earned once paid, or(b)terminate this Lease and Developer's Option to purchase '8� P12D399 DRSi20399 31R D9=111 the Option Property upon thirty (30) days written notice and City shall reimburse Developer for the Demolition Costs without interest within twelve(12) nnonths thereafter. E. Outside Expiration Date. In no event shall the Term of this Lease, as it may be extended pursuant to the protiisions of Section 3 B, 3 C and/or 3 D above be extended to a date which is more than five ( )years after the Effective Date F Developer's Termination Right (i) Developer, shall have the right following its completion of the demolition of the Existing Improvements as required herein, and upon thirty(30)days prior written notice to City to terminate this Lease prior to the Expiration Date without any further liability or obligation to the City hereunder or otherwise in connection with the Leased Premises or Option Property, with the exception of payment of Additional Rent, Taxes, Liens or other charges or performance of any indemnification obligations set forth in this Lease for the period arising or accruing for the period prior to Developer's termination of the Lease pursuant to this Section 3 F. (ii) Developer shall also have the right to terminate this Lease prior to the Expiration Date without liability to City if the City implements a zoning code amendment that prohibits the Project use or if the City raises regulatory fees or charges that apply only within the Planned Action Area. upon thirty (10) days prior written notice to the City, in which event City shall reimburse the Developer for the Demolition Costs without interest within twelN e(12)months thereafter 4. Rent. A. Prepaid Rent City acknowledges receipt of the sum of One Hundred Thousand m Dollars ($100,000) which represents prepaid Rent for the Initial Term Developer shall pay City additional rent for certain of the extensions of the Term as provided in Section 3 above Rent is fully earned once paid and is nonrefundable B. Leasehold Excise Tax. In addition to Prepaid Rent, Developer shall pay City leasehold excise tax on Taxable Rent as defined in RCW 82 29A (currently 12.84% of Taxable Rent) commencing as of the Effective Date Leasehold Excise Tax is also payable on any rental payments made during any extension term, if applicable C. Additional Rent. All amounts which Developer is required to pay to City pursuant to this Lease (other than Prepaid Rent) shall constitute additional rent ("Additional Rent") whether or not the same be designated as Additional Rent in this Lease. Except as otherwise expressly provided herein, Developer shall perform all of its obligations under this Lease at its sole cost and expense, and shall promptly pay all Additional Rent Developer shall also promptly pay to all third parties any other sums required to be paid by Developer under this Lease,when the same shall be due and payable and in all events prior to delinquency D Absolute Net Lease This Lease is intended to be and shall be construed as an absolutely net lease pursuant to which City shall not, except as otherwise expressly provided in this Lease, under any circumstances or conditions. whether presently existing or hereafter arising, or whether beyond the present contemplation of the parties, be expected or required to make any payments of any kind whatsoever or be under any other obligation or liability, except as otherwise expressly provided in this Lease and Developer shall make any and all payments required hereunder -9- P=399DRSQ039931R D9130111 1 5 Taxes and Utilities A. Payment of Taxes by Developer. With the exception of leasehold excise tax which shall be paid to City as prov ided in Section 4.13 above, Developer shall pay all Taxes directly to the applicable governmental agency prior to delinquency and shall provide proof of such payment promptly to City upon request. To the extent Taxes or other charges can be paid in installments, Developer may pay such Taxes in installments and shall only be liable for Taxes which accrue from and after the Effective Date With respect to any general or special assessments which may be levied against or upon the Leased Premises. or which under the Laws then in force may be evidenced by improvements or other bonds or may be paid in annual installments, only the amount of such annual installment, and interest due thereon. shall be included within the computation of Taxes Developer's obligation to pay such Taxes shall survive the expiration or earlier termination of this Lease. B. Personal Property Taxes. Developer shall pay prior to delinquency all personal property taxes. if any. assessed against and levied upon Developer's furnishings. equipment and all other of Developer's personal property located on the Leased Premises. if any Developer shall cause all such property to be assessed and billed separately from the Leased Premises C. Utilities. Developer shall be solely responsible for and shall pay separately for all charges for Utilities used or consumed on the Leased Premises, with the exception of utilities, if any, serving the Surface Parking Area It is understood that City shall not be required to prop-ide any Utilities to Developer, and Developer shall make any necessary arrangements to have all such Utilities billed directly to and paid for directly by Developer. 6. Demolition of Existing, Improvements. As part of the consideration for this Lease, Developer shall demolish and remove the Existing Improvements and other man-made structures located on the Leased Premises including any personal property or other equipment located on or within the Existing Improvements(other than the slab on grade and existing foundations which Developer may elect to retain, surface parking, paving and underground utility lines) at its sole cost and expense Subject to Developer's prior receipt of a demolition permit and all other necessary Governmental Approvals for demolition on or before the Effective Date. Developer shall commence such demolition on or before November 1, 2011 and thereafter diligently and continuously prosecute demolition of the above-grade portions of the Existing Improvements, removal and disposal to completion within ninety (90) days thereafter subject only to extension for Force Majeure. Time is of the essence and failure to commence or complete demolition and removal of the above-grade portions of the Existing Improvements and other existing personal property or equipment located on or within the Existing Improvements from the Leased Premises within the time period set forth above subject only to extension for Force Majeure shall constitute an Event of Default under this Lease. During the Initial Term and following removal of the above-grade Existing Improvements Developer shall conduct additional due diligence and engineering review of the feasibility of re-using all or any portion of the slab on grade and existing below-grade foundations If Developer determines that such re-use is not feasible, then Developer shall likewise demolish these structures and all third party costs in connection therewith as described below shall be included within the definition of"Demolition Costs" as used herein. Demolition shall include the proper removal, recycling and disposal of all of the Existing Improvements; personal property, equipment and debris, including demolition and removal of all above- grade portions of the Existing Improvements. Such demolition, recycling and removal shall be conducted in accordance with all applicable Requirements of Law. Developer shall have the responsibility for determining the location of existing underground utility lines and exercise due care not to damage, -10- P 120399 DRS120399 31R 09l30M1 puncture or unearth same Developer shall not remove any underground utility lines installed on the Propem pursuant to easements presently of record ,N ithout the prior written consent of the easement holder and the City. Following demolition and removal of the Existing Improvements, all areas of the Leased Premises will be re-graded flat to an elevation equal to the top of the existing slab on grade If fill is required to achieve this elevation, fill materials selected by Developer must be approved by City prior to placement on the Leased Premises. All soils remoNed from the Leased Premises as a result of the demolition work will be properly classified and disposed of in accordance with all applicable Requirements of Law Soil fences and erosion control measures will be taken in accordance with all applicable Requirements of Law Following completion of the demolition work, Developer shall fill any pot holes, repair any paving to the extent necessary to enable members of the public to park motor vehicles on and access the Surface Parking Area, and shall install temporary construction fencing, perimeter fencing or other construction barriers or screening around the perimeter of the demolition site in form acceptable to City to separate the demolition site from the remainder of the Leased Premises to enable members of the general public to use the Surface Parking Area for parking purposes. Developer shall ha\e the right to retain for its own account all proceeds derived from the sale, recycling or other disposition of the Existing Improvements, including any personal property. equipment and other improvements located on or within the Existing Improvements or otherwise located on the Leased Premises. n n Within thu-ty (30) days following completion of demolition of the Existing Improvements, Developer shall provide City with an accounting of all reasonable and necessary third party costs actually incurred by Developer to demolish, remove and dispose of the Existing Improvements (net of the proceeds, if any, realized from any sale or recycling of personal property or other equipment located on or within the Existing Improvements), together with evidence of payment of same not to exceed Three Hundred Fifty-Two Thousand Dollars (5352,000) (collectively, the "Demolition Costs"). Demolition Costs shall include all third party costs of (a)the demolition work, including costs for the demolition ' contractor(s). (b)general construction management services and (c)any related professional or consultant costs and fees, and shall not include salaries or other compensation of the officers, directors, employees or agents of Developer . office expense or general overhead expense, legal fees, the cost of any insurance required under this Lease or the Right of Entry Agreement between City and Developer dated August 23, 2011 ('`Right of Entry Agreement"), or any costs incurred as a result of the negligent act or omission of Developer or any of the Developer Parties in the demolition of the Existing Improvements. 7. Use of Leased Premises. Permitted Use. A Use of Leased Premises; Permitted Use. Developer shall have the right to use the Leased Premises for the demolition of the Existing Improvements (arid any associated personal property ; or other equipment) as provided in Section 6 above and for the limited purposes of determining the physical condition of the Leased Premises by conducting soil tests (including borings), hazardous waste surveys, land surveys, geotechnical, engineering, traffic and access studies, structural studies and any other sampling, audits, inspections, studies or tests reasonably required by Developer to determine the physical condition of the Leased Premises and the feasibility of the Option Property for the development, use and operation of the Project, and for any pre-construction activities related to the Project as authorized by the City in writing, all at Developer's sole cost and expense (the "Permitted Use") and for no other purpose without the prior written consent of City, which consent shall not unreasonably be withheld. B Quiet Enjoyment Upon payment by Developer of Rent as herein provided and upon the observance and performance of the covenants, terms and conditions on the Developer's part to -11- P@0399 DRSM399 31R 0913NI1 be observed and performed. Developer shall peaceably and quietly hold and enjoy the Leased Premises for the Tenn hereby demised without huidiance or interruption by City or any person or persons lawfully or equitably claiming. by, through or under City except as provided in Section 2 E above and rights of parties under Penmtted Exceptions C. No Insurance Cancellation Developer shall not do, bring, or keep anything in or about the Leased Premises that will cause a cancellation of any insurance required by Developer to have in place for the Leased Premises D No Unlawful Use, Waste. Nuisance or Damage Following completion of ; demolition of the Existing Improvements Developer shall maintain the Leased Premises in a clean and orderly condition, remove all debris and rubbish and maintain construction fencing, perimeter fencing or other construction barricades or screening in form approved by the City in good condition and repair,with the exception of those portions of the Surface Parking Area used for parking by members of the general public The City shall be responsible for all routine maintenance and repair of the Surface Parking Area Developer shall not allow the Leased Premises to be used for any unlawful purpose nor shall Developer use the Leased Premises in any manner that will constitute waste of the Leased Premises or a nuisance and Developer shall not do anything on the Leased Premises that will cause damage to the Leased Premises except for the demolition of the Existing Improvements. as required under Section 6 of this Lease E. Compliance with Laws Developer shall comply with all Laws concerning the Leased Premises and Developer's use of the Leased Premises, including without limitation, Environmental Laws. So long as no Event of Default has occurred and is contmuing, Developer shall have the right to contest at its sole cost and expense and after prior notice to City, by appropriate legal proceedings conducted in good faith and with due diligence. any Law, Tax, rule, order, ordinance, regulation or other requirement affecting the Leased Premises and to postpone compliance with the same during the pendency of such contest provided that the enforcement of such Law. Tax, rule, order, ordinance, regulation or other requirement is stayed during the pendency of such contest and the contest will not subject City to criminal or civil penalty or fine or jeopardize title to the Leased Premises. City shall cooperate with Developer in such contest at no cost to City and shall execute any documents or provide such information as Developer may reasonably request in furtherance of such proceedings. s Developer shall proceed diligently and in good faith to resolve such contest and shall not postpone compliance with any Law, rule, order, ordinance, regulation or other requirements if the same shall invalidate any insurance required by this Lease. Developer shall indemnify, protect, defend and hold the City, the Property and the Leased Premises harmless from any Lien or liability with respect to such Law, Tax, rule, order, ordinance, regulation or other requirement or contest thereof, including all cost and expenses related thereto. 8. Liens A. Covenant Against Liens Except as permitted under Section 8.13, Developer covenants and agrees that it shall not suffer or permit any Liens to be attached to, upon or against the Property the Leased Premises or any portion thereof or any Rent payable under this Lease arising out of the possession, use, occupancy, acquisition or demolition of the Existing Improvements, repair or maintenance of the Leased Premises, or by reason of the furnishing of labor, services, materials or equipment to the Leased Premises or to Developer or any of the Developer Parties (other than Liens arising through the actions of City) Developer agrees to indemnify, protect, defend and hold City harmless from and against all liabilities, losses, damages, expenses and costs (including reasonable attorneys fees and costs) incurred in connection with any such Lien(s) arising during the Term of this -12- P120399 1)R=0399 31R 09MII Lease (other than Liens arising through actions of the City) Developer's obligations pursuant to this Section 8.A shall surviv e the expiration or earlier termination of this Lease. B. Covenant to Remove Developer Liens Developer will promptly, and in all events within thirty (30) days following the attachment of same, remove and discharge any and all Liens (other than Liens arising through the actions of City) which attach to, upon or against the Property, the Leased Premises or any portion thereof Developer reserves the right to contest the validity or amount of any such Liens in good faith, provided that within thin (30) days after the filing of such Liens, Developer discharges said Liens of record or records a bond which complies with the requirements of RCW 60 04 161 eliminating said Liens as an encumbrance against the Property and/or the Leased Premises. In the event Developer shall fail to so remove any such Liens, City may take such action as City shall reasonably determine to remove such Liens and all costs and expenses incurred by City including, without limitation, amounts paid in good faith settlement of such Liens and attorneys' fees and costs shall be paid by Developer to City as Additional Rent. together with interest thereon at the rate of eight percent (8%) interest per annum from the date advanced until paid Developer's obligations pursuant to this Section 8.13 shall survive the expiration or earlier termination of this Lease. C. Disclaimer of Liability by City. Nothing contained in this Lease shall be construed as the consent or request of City, express or implied, for the performance by Developer of any labor or services or for the furnishing of any materials or equipment for any construction, alteration, addition, repair to the Property or the Existing Improvements or the Leased Premises (or any part thereof) NOTICE IS HEREBY GIVEN THE CITY WILL NOT BE LIABLE FOR ANY LABOR, SERVICES, MATERIALS OR EQUIPMENT FURNISHED OR TO BE FURNISHED TO DEVELOPER OR ANYONE HOLDING ANY INTEREST IN THE LEASED PREMISES OR ANY PART THEREOF THROUGH OR UNDER DEVELOPER AND THAT NO MECHANIC'S OR OTHER LIENS FOR = ANY SUCH LABOR, SERVICES, MATERIAL OR EQUIPMENT SHALL ATTACH TO OR AFFECT THE INTEREST OF CITY IN THE LEASED PREMISES OR THE PROPERTY. 9. Overall Description of Project Conceptual Plans, Land Use Approvals, Permit Summary. A. Description of Overall Project, Conceptual Plans City would not have entered into this Lease but for the agreement by Developer to undertake at Developer's sole cost and expense,the predevelopment activities set forth in this Lease to determine the feasibility of the Option Property for the development, use and operation of a mixed-use development project that will consist of not less than four levels of wood frame construction over one level of above—grade concrete construction containing ' approximately 164 market rate. all-ages, urban-style rental apartments, at least 3700 square feet of ground floor retail space located at the intersection of 4"'Avenue North and West Smith Street, and not less than 35 parking spaces which shall be available for free, short-term public parking during normal business hours, seven days a week (the "Minimum Required Project Elements'), together with such common areas, additional on-site parking (of which 121 parking spaces may be reserved for use by residential tenants), landscaping and ancillary improvements as may be proposed by Developer and approved by City as provided in Section 10 below(the"Project") B. Description of Option Property, Boundary Line Adjustment. The Option Property will consist of approximately 1 5 acres of land consisting of all of Parcels A and B and a portion of Parcel C. City of Kent Lot Line Adjustment No LL-2005-37 which is legally described on Exhibit C attached hereto and by this reference incorporated herein and which is depicted on the site map annexed hereto as Exhibit D The parties understand and agree that the description of the Option Property set forth above is approximate Once Developer has finalized the site plan for the Project.Developer shall provide City with a drawing shownig its proposed location for the revised boundary between Parcel B and Parcel C of the Property, for City's approval, which approval shall not be unreasonably withheld. Once -1 J- P120399 DRS120399 31R 09/30/11 the parties have agreed upon the proposed boundary line and Developer has exercised its Option to purchase the Option Property. the City shall prepare, process and obtain approval of a boundary line adjustment or other subdivision process (the "Boundary Line Adiustrnenf') consistent with Exhibit at its sole cost and expense as necessary to reconfigure the boundary between Parcels B and C so that the Option Property will consist of one or two legal lots consistent with the Kent Zoning and Subdivision Codes. The Boundary Line Adjustment shall be recorded on or before the Closing Date and shall be an express condition precedent to Developer's obligation to close its purchase of the Option Property City's failure to prepare, process and obtain approval of the Boundary Line Adjustment or other subdivision process that prevents construction of the Project shall constitute an Event of Default by City under this Lease. The map annexed hereto as Exhibit D indicates the parties' contemplated reconfiguration of Parcels B and C. The City shall retain ownership of the remainder of Parcel C as depicted in Exhibit D. In the event Developer intends to construct the Project on the Option Property without regard to any interior lot lines between Parcel A and Parcel B (as adjusted following the recording of the Boundary Line Adjustment), Developer acknow ledges that the KCC requires submission of an application to consolidate the two legal lots (Parcel A and Parcel B. as adjusted following the Boundary Line Adjustment) into a single legal lot and recordation of a lot line elimination certificate with the King County Assessor's office prior to Commencement of Construction of the Project C. Minimum Design Criteria for the Project. City and Developer agree that the Project shall contain the Minimum Required Project Elements and that the design and development of the Project shall be consistent in all material respects with the following design prmciples and guidelines: (a)the Kent Comprehensive Plan, (b)the Downtown Strategic Action Plan, (c)the City's zoning code, including the Downtown Commercial Enterprise Zoning District, (d) the Kent Downtown Design Guidelines dated September 19, 2000, and subsequent amendments thereto, (e)the Kent City Center Design Principles set forth on Exhibit E attached hereto and by this reference incorporated herein which set forth certain core goals and design guidelines for redevelopment of the Option Property. and (f)the Planned Action Ordinance and environmental impact statements with respect to future land uses and mitigation measures identified therein more particularly described in Section 9 D, below, each of which is on file with the City (collectively, the "Minimum Design Criteria') City has provided copies of the Minimum Design Criteria to the Developer and its design team D. Land Use Permits and Environmental Approvals. In compliance with the State Environmental Policy Act (' SEPA"), the City previously conducted environmental review of proposed development within the Planned Action Area consisting of approximately 25 acres located in downtown Kent pursuant to the Kent Station Planned Action Supplemental Environmental Impact Statement ("SEIS"), including the draft supplemental SEIS dated April 23, 2002 and the final supplemental SEIS dated July 8, 2002 Pursuant to City of Kent Ordinance No 3608 passed by the Kent City Council on July 16, 2002, a copy of which is attached hereto as Exhibit F, the City adopted a Planned Action Ordinance and adopted the SEIS for the Plammed Action Area described therein. The Option Property is located within the Planned Action Area. Land uses and development levels, together with the customary accessory uses and amenities described in the SEIS subject to the planned action thresholds set forth in the PAO and the mitigation measures described in the Mitigation Document (Exhibit A thereto) are designated Planned Actions or Planned Action Projects pursuant to RCW 43 21 C 031 A land use permit application for a development proposal within the Planned Action Area shall be designated as a Planned Action(and not subject to further environmental review) if it meets the criteria set forth in Section 3(D) of the PAO and applicable laws, codes, development regulations and standards of the City including the Kent City Center Design Principles The Developer shall submit an environmental checklist with its application for Downtown Design Review and request the City's SEPA Responsible Official or designee to designate the Project application as a Planned Action pursuant to RCW 43 21C.031(2)(a) and Sections 3(d) and 3(e) of the PAO Developer acknowledges that City may require additional SEPA review for the Project if at the time the Developer's complete building permit application is submitted, -14- P 120399 DRS120399 31R 0913DO1I previously designated Planned Action projects within the Planned Action Area exceed the development thresholds set forth in the PAO or the Project results in adverse environmental impacts that have not been previously identified and analyzed in the SEIS City hereby represents and warrants to Developer that as of the Effective Date previously designated Planned Action housing and retail projects within the Planned Action Area have not exceeded the development thresholds for housing and retail development set forth in the PAO City's breach of this representation shall constitute an Event of Default under this Lease. E. Vestin . The Project shall be governed by the City land use controls and development regulations in effect on the date that the Developer submits a fully completed building permit application that has been accepted as complete by the City pursuant to KCC 12 01 100(D). This Section 9 E does not apply to fees, rates and charges and does not apply to requirements necessary for public health and safety, including without limitation, the International Building Code, International Fire Code. International Plumbing Code, International Electrical Code and International Mechanical Code, including all local amendments to these international codes or to requirements necessary to comply with new state or federal laws. All development on the Option Property shall be subject to design review under the version of the Downtown Design Review Guidelines in effect when the first complete application for design review is submitted. 10. Predevelopment Activities with Respect to the Project. A Schedule for Project Development City would not have entered into this Lease but for the agreement by Developer to undertake, at Developer's sole cost and expense, the demolition of the Existing Improvements and the design of the Project containing the Mini num Required Project Elements in accordance with the Minimum Design Criteria. application for and receipt of all permits needed to demolish the Existing Improvements and application and approval of all necessary permits to construct the Project, and Developer's receipt of all financing necessary to build the Project in accordance with the development milestone schedule set forth on Exhibit G attached hereto and by this reference r incorporated herein City and Developer shall each proceed with all necessary due diligence and in good faith to complete such matters as require action or approval on the part of City and Developer City and Developer agree to promptly and in good faith respond to all questions and concerns raised by City staff, architects, engineers and other consultants in order to ensure to the greatest extent practical that the Project is designed, permitted and financing obtained on or before the dates set forth in Exhibit G hereto. The intent of the parties is to cooperate in good faith to provide a complete design for the Project which meets all Requirements of Law, contains the Minimum Required Project Elements, and is consistent with the Mimmum Design Criteria and the building quality reflected therein. B. Design Review and Approval (i) Pre-Application Meeting, Conceptual Plans. Promptly following execution of this Lease, Developer shall cause its architects to prepare Conceptual Plans which are the initial Drawings and other documents illustrating the scale and relationship of the Project components including the number and configuration of apartment units (including number of bedrooms). entrances and exits to the Project, interior circulation plan, ground floor retail space, public parking, common areas, other on-site parking, landscaping and other ancillary improvements As used herein, "Drawings" include all graphic and pictorial documents depicting the design, location and dimensions of the Project and include plans, elevations, sections, details. schedules and diagrams for the Project Developer shall submit an application, together with the other documents required under the KCC including the Conceptual Plans, to the City for its review and approval following the Pre-Application meeting City shall give Developer written notice within fifteen (15) days following the Pre-Application meeting of its approval or disapproval of the Conceptual Plans, specifying in the case of its disapproval its reasons therefore City shall have the right to disapprove Conceptual Plans which(i) do not contain the Minimum -15- Pi20399 DRS120399 31R 09f30ilI Required Project Elements set forth elsewhere in this Lease, (ii) do not comply with all applicable building and land use laws, rules and regulations. or (inn) do not comply with the Minimum Design Criteria in all material respects and the building qualm reflected therein. Developer shall. immediately following receipt of a notice of disapproval of the Conceptual Plans, undertake to further amend and modify the Conceptual Plans so as to conform to the requirements set forth above, and upon completion thereof, the same shall be submitted to City for its written approval within fifteen (15) days as hereinabove provided If City fails to give written notice of its approval or disapproval within fifteen (15) da)s following receipt of the Conceptual Plans or of any required modification or amendment thereof, the same shall be deemed to have been approved by City. Once approved by the City, the Conceptual Plans shall be attached to this Lease as Exhibit H (ii) Downtown Design Review The Project is subject to downtown design review as a Process II application under KCC 15 09 046 Downtown design review is an administrative process and is conducted as part of the permit review process Upon preparation of Schematic Design Documents for the Prolect. the Developer shall file an application for design review by the Downtown Design Review Committee established pursuant to KCC 15 09 046 C The Downtown Design Review Committee shall use the Downtown Design Guidelines in the evaluation and/or conditioning of Developer's application under the downtown design review process. The Downtown Design Review Committee shall have the right to reject Developer's application submitted for downtown design review if the Schematic Design Documents submitted in connection with the application for downtown design review (i) do not contain the Minimum Required Project Elements; (u)do not comply with the Conceptual Plans in all material respects, (iii) do not comply with all applicable building and land use laws, rules and regulations, or (iv) do not comply with the Minimum Design Criteria in all material respects and the building quality reflected therein The decision of the Downtown Design Review Committee to approve. condition, or reject any application under the downtown design review process is final unless an appeal is made to the hearing examiner within fourteen (14) calendar days of either the issuance of the committee's conditional approval or rejection of any application under KCC 15 09.046. The decision of the hearing examiner shall be final, unless an appeal is made to King County Superior Court,within twenty-one(21)calendar days of the date of the decision C. Waiver of City of Kent Multifamily Property Tax Exemption. Developer does hereby irrevocably waive its right to any City of Kent multifamily property tax exemption for which the Project might otherwise qualify under Chapter 3 25 KCC. D. Application and Issuance of Construction Permits for the Protect. (i) Approval Procedure — Construction Permits. Following completion of the downtown design review process and approval of the Discretionary Permits,Developer shall cause its consultants to prepare final construction drawings for the Project in a form sufficient to apply for the Construction Permits for the Project (the "Construction Permit Documents") which Construction Permit Documents shall be consistent with the Schematic Design Documents approved as part of the Downtown Design Review Process in all material respects The Construction Pen-nit Documents shall, in addition to the requirements set forth in the application, include a site plan, engineering plan, elevations, the articulation and heights of buildings, setbacks, access to retail space from the public streets adjoining the Option Property, interior circulation plan, courtyards, and any rooftop garden/amenity space, location of the 35 public parking spaces, other on-site parking, loading docks and other ancillary improvements, proposed exterior materials and landscaping plan including the size of any open space, and other sustainability features for the Project Developer shall file complete, combined applications for a civil construction permit and the building permit (collectively, "Construction Permits') on or before the date set forth in the milestone development schedule attached hereto as Exhibit G Such applications shall be processed in accordance with a Process I action as outlined in Chapter 12 01 of the KCC. Failure of the -16- P 203?9_DR520399 31R t19301� Developer to file complete applications for the Construction Permits on or before the date set forth on Exhibit G shall constitute an Event of Default under this Lease, which if not cured within thirty (30) days after written notice of such default shall give City the right to terminate this Lease upon sixty (60) days prior written notice to the Developer and Developer's Construction Lender, if any (ri) Approval Procedure Construction Permit Documents The City shall promptly review the combined applications for the Construction Permits and Construction Permit Documents and give Developer written notice in accordance with the KCC of the City's approval or disapproval thereof, specifying in the case of disapproval, the reasons therefore The City shall have the right to reject the Construction Permit applications if the Construction Permit Documents submitted in connection with the applications for the Construction Permits (i) do not contain the Minimum Required Project Elements, (ii)do not comply with the Schematic Design Documents approved as part of the Downtown Design Review process in all material respects, (mi) do not comply with all applicable building and land use laws, rules and regulations, or (iv) do not comply with the Minimum Design Criteria in all material respects and the building quality reflected therein. Nothing contained herem shall constitute a waiver of the City's rights as the jurisdiction with permitting authority over the Project to review Developer's application for building and other permits, or to impose conditions prior to issuance of permits necessary to construct the Project in accordance with City and State laws, rules and regulations (iii) Re submittals-Construction Permit Documents. If objections or comments are submitted in writing as set forth in the preceding subsection, Developer shall cause its consultants to arnend or modify the Construction Permit Documents so as to respond to objections or comments made by the City and shall resubmit the same for further review. The process of resubmittal and review shall continue until the City has approved the submittals The final Construction Permit Docu rents setting forth in detail the requirements for the construction of the Project which have been approved by the City are called the "Approved Construction Permit Documents" There shall be no material changes in the Approved Construction Permit Documents except as set forth in Section 10 D(iv) below. (iv) Changes to Construction Permit Documents. There shall be no significant changes to the Approved Construction Pen-nit Documents without the prior written consent of the City. which consent shall not be unreasonably withheld or delayed Notwithstanding the foregoing, changes in methods or type of construction, changes typically handled as "subject to field inspection" changes and/or substitution of materials that the City determines is consistent with the Downtown Design review approval for the Project and that otherwise satisfy the requirements of the KCC shall not be considered "significant changes" as described herein. All proposed significant changes in the Approved Construction Permit Documents shall be submitted to the City for review and approval pursuant to the requirements set forth in the KCC. The City shall notify Developer in writing following receipt of such proposed change whether the City approves or disapproves such change If the City approves such change, the proposed change shall be deemed approved, and such change shall thereafter become part of the Approved Construction Permit Documents If the City disapproves such change, the City shall notify Developer in writing specifying the reason for its disapproval. .s' The City and Developer agree that the procedures set forth in this Section 10 D reflect the City's contractual right to review permit documents and does not constitute time periods for review of permit applications by the City's Economic and Community Development Department under the municipal powers granted to the City by the laws of the State of Washington All time periods for review shall commence upon submission of an application deemed complete by the City pursuant to the KCC -17- P@0399 DRS=399 31R 0913D/11 (v) Fees Developer shall pay all fees upon submittal of applications to the City for permits as set forth in the Permit Summary or as otherwise required under the KCC and shall pay all fees associated with obtaining all Governmental Approvals required under the PAO and the KCC no later than the date that the Construction Permits for the Project are approved for issuance The City shall process such building and other pen-nit applications in accordance with all requirements set forth in the KCC. IL Insurance and Indemnification. A. Insurance Developer shall procure and maintain. at a minimum, for the duration of this Lease and, if the Option is exercised. until Final Completion of the Project. the following insurance against claims for injuries to persons or damage to property which may arise from, or in connection with the performance of work hereunder by the Developer. or any of the Developer Parties. The cost of such insurance shall be paid by the Developer or the Developer Parties Coverage shall be at least as broad as. (1) General Liability: Insurance Services Office form number (CG00 001) covering Commercial General Liability, with a limit of not less than $1,000,000 combined single limit per occurrence. $2,000,000 aggregate (ii) Automobile Liabilitv Insurance Services Office form number (CA 00 01) covering Business Automobile Coverage, symbol 1 "any auto", or the combination of symbols 2, 8, and 9, with a limit of not less than $1.000.000 combined single limit per occurrence, $2,000,000 aggregate (iii) Workers' Compensation. Workers' Compensation coverage, as required by the Industrial Insurance Act of the State of Washington. statutory limits (iv) Builders Risk Insurance. During the period of construction and until Final Completion of the Project, Developer shall also provide builder's risk insurance for the full 100% replacement cost of all such improvements as required by Project financing and in accordance with generally accepted industry standards and requirements covering all work to be done on the Project Developer shall have the required Builder's Risk Policy in place no later than Commnencement of Construction of the Project The Builder's Risk Policy shall include Developer, the general contractor and their subcontractors, other contractors,the Construction Lender and the City as insureds in an amount equal to their interest with a loss payable clause in favor of the Construction Lender The loan documents approved as part of the Approved Financing Plan (as hereafter defined) shall require the Construction Lender to use any insurance proceeds to repair or rebuild the Project if there is a casualty loss during the course of initial construction of the Project Developer shall keep the Builders Risk Policy in place from Commencement of Construction until Final Completion of the Project (a) Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions must be declared to and approved by City, which approval shall not be unreasonably withheld or delayed. The deductible and/or self-insured retention of the policies shall be the sole responsibility of Developer (b) Other Insurance Provisions. The insurance policies required by this Lease are to contain or be endorsed to contain the following provisions where applicable- As- P=399�-DRV20399_31R 00/30/11 3 (A) Liability Policies- (i) City, its officers, officials. employees and agents are to be covered as additional insureds as respects liability arising out of activities performed by or on behalf of Developer or an} of the Developer Parties in connection a ith this Lease (ii) Developer's insurance coverage shall be primary insurance as respects City, its officers, officials, employees and agents Any insurance and/or self- insurance maintained by City. its officers, officials, employees and/or agents shall not contribute with Developer's insurance or benefit Developer in any w ay (ni) Developer's insurance shall apply separately to each insured against whom a claim is made and/or lawsuit is brought, except with respect to the limits of the insurer's liability. (iv) By requiring such minimum insurance, City shall not be deemed to, or construed to, have assessed the risks that may be applicable to Developer associated with this Lease Developer shall assess its own risks and, if it deems appropriate and/or prudent maintain greater limits or broader coverage. (v) Insurance required under this Lease may be covered under a blanket policy of insurance so long as such blanket policy of insurance meets the minimum amounts of insurance required hereunder (B) All Policies. Coverage shall not be canceled until after thirty(30) days' (10 days' for non-payment)prior written notice has been given to City, (C) Acceptability of Insurers. (i) Unless otherwise approved by City, or its risk manager, insurance is to be placed with insurers with a Best's rating of no less than A•VIII, or, if not rated by Best's, with minimum surpluses the equivalent of Best's surplus size VIII All insurance companies providing insurance under this Lease shall be authorized to do business in the State of Washington (11) If, at any time, any of the foregoing policies shall fail to meet the above minimum standards, Developer shall, upon notice to that effect from City, promptly obtain a new policy, and shall submit the same to City. with certificates and endorsements. for approval. (D) Verification of Coverage. Developer shall furnish City with evidence of the insurance required by this Lease City reserves the right to require Developer to deliver complete certified copies of all required policies at any time. B. Indemnification. (i) By Developer. 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"), to the extent such claims arise out of or in any way result from the acts or omissions of Developer. or any of the Developer Parties or their respective officers, employees, agents, contractors and/or subcontractors of all -19- P120399 DRM20399 31R 09/30/11 tiers, in the performance of its obligations under this Lease. Developer's obligations under this Section 11 shall include,but not be limited to (A) The duty to promptly accept tender of defense and provide defense to City at Developer's own expense (B) The duty to indemnify and defend City from any claim, demand and/or cause of action brought by or on behalf of Developer, an} of the Developer Parties or any of then respective agents or employees. The foregoing duty is specifically and expressly intended to constitute a wan ei of Developer's immunity under Washington's Industrial Insurance Act, RCW Title 5l, as respects City only, with a full and complete indemnity and defense of claims made by employees of Developer or any of the Developer Parties The parties acknowledge that these provisions i were mutually negotiated and agreed upon by them z (C) In the event City incurs any judgment, award, and/or costs arising therefrom, including attorneys' fees, to enforce the provisions of this Section 11, all such fees. expenses. and costs shall be paid by Developer Notwithstanding the provisions contained in Subsection II.A, 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 any of its officers, officials, employees or agents or breach of this Lease by City (1i) By Ci City shall protect, defend, indemnify, and save harmless Developer 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'), to the extent such claims arise out of or in any way result from the negligent acts, omissions or willful misconduct of the City in the performance of its obligations under this Lease City's obligations under this Section 11 shall include, but not be limited to (A) The duty to promptly accept tender of defense and provide defense to Developer at City's own expense (B) The duty to indemnify and defend Developer from any claim, demand and/or cause of action brought by or on behalf of City or its agents or employees The foregoing duty is specifically and expressly intended to constitute a waiver of City's immunity under Washington's Industrial Insurance Act, RCW Title 51, as respects Developer only, with a full and complete indemnity and defense of claims made by employees of City The parties acknowledge that these provisions were mutually negotiated and agreed upon by them (C) In the event Developer incurs any judgment, award, Y and/or costs arising therefrom, including attorneys' fees, to enforce the provisions of this Section 11, all 1 such fees, expenses, and costs shall be paid by City. Notwithstanding the provisions contained in Subsection I LB above, City's obligation to indemnify Developer shall not extend to any claim. demand or cause of action to the extent caused by the negligence of Developer or any of the Developer Parties or breach of this Lease by Developer 12. Damage and Destruction: Condemnation of the Property. A Damage and Destruction during the Lease Term. Developer and City acknowledge that Developer is required to demolish the Existing Improvements as part of the i .20- P 120399 DRS120399 31R D9130111 consideration for this Lease and that the Option Price is not based upon the value of such improvements. Therefore, if the Existing Improvements on the Leased Premises are damaged by fire or other casualty prior to Closing, this Lease shall not terminate, and Developer shall not be released of its obligation to complete demolition of the Existing Improvements in accordance with the requirements of Section 6 of this Lease. ✓ B. Entire Condemnation If all or substantially all of the Option Property is taken by eminent domain, this Lease shall automatically terminate as of the date Developer is required to N acate the Option Property Substantially all of the Option Property shall be deemed to have been taken if Developer reasonably determines that the remaining portion of the Option Property is not of sufficient size or utility to permit deN elopment and operation of the Project thereon in an economically feasible basis Developer and City shall each receive the present value of their respective interests under this Lease, together with interest thereon from the date of taking to the date of payment at the rate paid on the award, and attorney s fees and other costs to the extent awarded The present values of the City's and Developer's respective interests as set forth in this Lease shall be established by the same court of law or other trier of fact that establishes the amount of the condemnation award Such award shall be determined without regard to any early termination of the Lease C. Partial Condemnation. Except as provided in subsection B above, if less than all or substantially all of the Option Property shall be taken as a result of the exercise of the power of eminent domain, then this Lease shall continue in full force and effect as to the remaining Option Property and there shall be no abatement of Rent or change in the Option Price for the Option Property 13. Assignment, Subletting. A. Assignments and other Transfers During Tenn of Lease Except as authorized hereunder as part of an Approved Financing Plan, Developer shall not assign, transfer, mortgage. pledge, hypothecate or encumber this Lease or any interest thereon. including, but not limited to its Option to purchase the Option Property, or sublet the Leased Premises or any part thereof, without City's prior written consent in each instance, which consent may be withheld by City in its sole discretion Any request by Developer for such consent shall be in writing, which shall set forth the details as to the proposed assignment; transfer, mortgage, pledge, encumbrance or subletting and have annexed thereto a copy of the proposed mortgage, assignment or sublease Any attempted assignment, transfer, mortgage, encumbrance or subletting without such consent shall be void and shall constitute a breach of this Lease. Any transfer of Developer's interest in this Lease or the Option to purchase the Option Property by merger, consolidation, liquidation or change in the Controlling Interest in Developer shall be deemed a prohibited transfer within the meaning of this Section 13 B. Transfers of Interest in Developer Developer acknowledges that City is relying upon the personal knowledge, expertise and experience of Developer and its principals and shareholders, who currently have a Controlling Interest in, and are employed by Developer, and City would not have entered into this Lease or granted Developer an Option to purchase the Option Property, but for the personal knowledge, expertise and experience of John A Goodman, George Petrie and Brad Reisinger, and John A Goodman's continued ownership of a Controlling Interest in Developer. Accordingly, existing shareholders in Developer other than John A. Goodman may transfer, convey or assign shares of stock in Developer so long as John A Goodman shall continue to hold a Controlling Interest in Developer and each of John A Goodman. and George Petrie continue to have a material and active involvement in the on-going management and development of the Project until Stabilized Occupancy of the Project. For purposes of this Section 13 and the Contingent Payment Agreement. "Stabilized Occupancy of the Project' means that eighty-five percent (85%) of all retail space and eighty-five percent (85%) of all apartments in the Project have been leased to tenants in occupancy and paying rent under the terms of -21- P 120399_DRS120399 31R 09/30/11 their leases for a period of three(3) consecutive months Any other transfer shall require the prior written consent of the City, which consent may be withheld by the City in its reasonable discretion Notwithstanding anything to the contrary contained in this Section 13 B, Developer at any time after Stabilized Occupancy of the Project may elect to convey the Project without the need for any City approval,but subject mall cases to the terms and conditions of the Contingent Payment Agreement C Definition of Transfer. As used herein, a "transfer" includes anv mortgage, pledge or sale, transfer, conveyance, assignment or other disposition of either (a)any of John A. Goodman's existing ownership interest of stock in Developer as of the Effective Date, or (b) fifty-one percent (51%) or more of the total outstanding voting stock ni Developer (each, a"Controlling Interest'), whether voluntary or involuntary. by operation of law or otherwise, mcludinQ transfers to a trustee in bankruptcy, receiver or assignee for the benefit of creditors, any merger, consolidation, liquidation or dissolution of Developer and includes the sale, transfer. mortgage, pledge or encumbrance of a Controlling Interest in Developer The execution and delivery of any joint venture agreement,partnership agreement, limited liability company agreement, declaration of trust, option or other agreement whereunder any other person may become entitled directly or directly, to the rights of Developer under this Lease (except in accordance with an Approved Financing Plan) shall in each case be deemed to be a transfer of Developer's interest for purposes of this Section 13 and shall require the prior written consent of City D. Transfers Pursuant to Approved Financing Plan Notwithstanding the foregoing, Developer may as part of its Approved Financing Plan assign the Option to purchase the Option Property effective as of the Closing to a limited liability company formed to take title to and develop the Project on the Option Property so long as Developer is either the sole general partner in any limited partnership or the sole managing member or sole manager of any limited liability company and either Developer or John A Goodman own a Controlling Interest in any such entity and retains day to day management control of such entity and each of John A Goodman and George Petrie continue to have a material and active involvement in the on-going management and development of the Project on the Option Property until Stabilized Occupancy of the Project. 14. Title to Option Property. A Title to Option Proper City shall execute and deliver to Developer at Closing a bargain and sale deed in the form attached hereto as Exhibit I ('Deed") which shall be accepted by Developer, conveying fee title to the Option Property subject to the Permitted Exceptions determined in accordance with Sections B and C below. B. Title Insurance On the Closing Date. City shall cause the Title Company to issue Developer a standard coverage Owner's Policy of Title Insurance (the "Title Policy"), with liability in the amount of the Option Price insuring fee simple title to the Option Property in Developer, against any loss or damage by reason of defects in City's title to the Option Property other than the Pennitted Exceptions Developer may, at its sole cost and expense, request extended coverage or endorsements to the Title Policy, but the availability of such extended coverage or endorsements shall not be a condition precedent to Closing. Developer, at Developer's sole cost and expense, may further elect to obtain a leasehold policy of title insurance insuring its interests in the Leased Premises C. Title Review Developer acknowledges that the Title Company has provided Developer with a preliminary commitment for title insurance for the Option Property under First American Title Insurance Order No NCS-50243-WA1, Third Report, dated September 21, 2011 ("Title Commitment"). Developer has approved all of the special exceptions set forth in Exhibit M attached hereto subject to City's agreement with Developer and/or Title Company to remove or use good faith -22- P=399_DRSQ0399_31R 0913DIl1 efforts to remove certain of the special exceptions as set forth in Exhibit M(the '`Permitted Exceptions"). Failure of the City to take all necessary action to terminate special exception 16 (the "Surface Parkins Easement") upon Closing of the sale of the Option Property shall constitute a City Event of Default hereunder. (i) Updated Title Report Developer shall have the right to order a supplement to the Title Commitment upon exercise of the Option Developer shall advise City what exceptions to title, if any, in addition to the Permitted Exceptions, will be accepted by Developer within ten (10) days following Developer's receipt of the supplement to the Title Commitment. provided, however, that Developer shall not be entitled to object to agreements and easements that are required under the terms of any Governmental Approvals required to build the Project, or easements, hens or other exceptions arising through Developer or any of the Developer Parties, and City shall be responsible for removing or terminating any additional exceptions to title created by or through the City after the Effective Date If Developer fails to object in writing to any such additional exceptions within such ten (10) day period, Developer shall be deemed to have approved the same as Permitted Exception(s). (ti) City's Notice The City shall have ten (10) days after receipt of Developer's notification within which to notify Developer whether or not it elects to cure or remove any of the disapproved exceptions of which the City receives tiimely notice pursuant to Section 14 C(i) The City's failure to so notify Developer shall constitute the City's election to not remove all such exceptions. The City shall remove all exceptions it is required or otherwise elects to remove on or before the Closing Date for Developer's purchase of the Option Property (ni) Developer's Election If the City does not elect to remove all exceptions disapproved by Developer under Section 14 C(i) (with the exception of any exceptions City is required to remove thereunder), Developer may elect to terminate this Lease by written notice to the City given within ten (10) days following the City's notice, whereupon this Lease shall automatically terminate, and except as otherwise expressly provided herein, neither party hereto shall have any further rights, duties or obligations under this Lease If Developer does not elect to terminate this Lease within the time frame set forth herein, disapproved exceptions that the City has not elected to remove shall become Permitted Exceptions for the Option Property (iv) Title Not Insurable If title is not insurable subject only to the Permitted Exceptions determined in accordance with this Lease,Developer may elect to proceed with the Closing of the purchase of the Option Property despite such nomnsurabihty, thereby accepting any such matters as Permitted Exceptions. or Developer may terminate this Lease by written notice to the City in which event this Lease shall automatically terminate, and except as otherwise expressly provided herein, neither parry hereto shall have any further rights, duties or obligations under this Lease 15. Representations. In order to induce each other to enter into this Lease and the transactions contemplated hereby, City and Developer make the following representations as of the Effective Date and, if Developer exercises the Option to purchase the Option Property, as of the Closing Date- A. City ReMesentations. City represents to Developer as follows: (i) Authonty City is a municipal corporation duly organized and existing under the laws of the State of Washington Pursuant to City Council motion adopted September 20, 2011, the City Council authorized its Mayor or Mayor pro tem to execute and deliver this Lease on behalf of the City. No other authorizations or approvals of the City Council are required for City to lease the Leased -23- P 120399 DR5120399 31R D913D111 Premises to Developer or sell the Option Property (if Developer exercises the Option to purchase the Option Property)to Developer. i (ii) No Conflicts. Neither the execution, delivery or performance by City of its obligations under this Lease nor the consummation of the transactions contemplated hereunder will constitute a breach of any evidence of indebtedness or other financing agreement to which City is a party or by which City is bound. (iii) Title To City's Knowledge, there are no liens, encumbrances or other matters affecting title to the Option Property except as disclosed in the Title Commitment City has not entered into any agreement ,ranting any person the right to use or lease all or any portion of the Option Property, the Leased Premises or the Existing hmprovements other than execution of this Lease with Developer nor has City granted any option of otherwise committed itself to sell the Option Property or airy portion thereof or the Existing Improvements to any party other than Developer City has agreed to undertake those obligations set forth in Exhibit M hereto with respect to removing certain existing exceptions to title on or before closing of the Option Property. (iv) No Litigation There is no litigation pending or, to City's Knowledge, threatened against the Option Property. (v) No Condemnation There is no condemnation proceedings pending or,to City's Knowledge,threatened against the Option Property. (vi) Pen-nit Summary The Permit Summary attached hereto as Exhibit O is a non-binding informational summary prepared by the City to assist the Developer in understanding the major permit processes applicable to the Project as of the Effective Date of this Lease. (vii) Hazardous Substances. To City's Knowledge, and except as disclosed in information and documents provided by City to Developer. City (a)has not received written notice that the Leased Premises or Option Property are in violation of any Environmental Laws, and (b)no Hazardous Substances have been used, generated, transported, treated, stored, released, discharged or - disposed of in, onto,under or fiom the Leased Premises or Option Property in violation of any Environmental. Laws, (c)there are no asbestos-containing materials, PCBs or urea formaldehyde, "underground storage � tanks" (as that term is defined under applicable Environmental Laws), above-ground storage tanks, or other containers of Hazardous Substances on the Leased Premises or Option Property, and (d)there are airy actions, suits, proceedings, orders, inquiries, or investigations pending or threatened against. the Leased Premises or Option Property, at law or in equity, before or by any federal. state, municipal, or other governmental department, court commission, board, bureau, agency, or instrumentality, regarding any Environmental Law or Hazardous Substances (vim) City's Knowledge As used herein, the term "to City's Knowledge" means the actual knowledge of Kurt Hanson, Economic Development Manager, Ben Wolters, Director, Economic & Community Development and Thomas Brubaker, City Attorney for the City In the event that after the Effective Date and prior to the Closing Date, City becomes aware of the existence of any fact (including a fact revealed by Developer in connection with its due diligence investigation and not known to City as of the Effective Date), that makes any of the representations set forth above no longer true and correct, City shall promptly notify Developer of the same If and to the extent of disclosure by City of any such change in its representations, Developer may elect to terminate this Lease on or before the date that is the later of(i)five (5) Business Days after Developer's receipt of such notice, or (n) if Developer has exercised the Option to purchase the Option Property, the Closing -24- P 120399 DRS120399 31R 09/30111 i Date, and the Closing Date shall be extended. if required to provide Developer with a minimum of five (5)Business Days to evaluate such additional information. B. Developer Representations. Developer represents to City as follows: (i) Authority Developer is a corporation duly organized and validly existing under the laws of the state of Washington and has the power to carry on its business as now conducted All corporate or other action on the part of the Developer and its directors and shareholders necessary for the execution. delivery and performance of this Lease has been duly taken and Developer has full corporate power and authority to enter into, execute and deliver this Lease and perform its obligations under this Lease (ii) No Conflicts. Neither the execution, delivery or performance by Developer of its obligations under this Lease nor the consummation of the transactions contemplated hereunder(including the purchase of the Option Property if Developer exercises the Option granted under Section 19 hereof) 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 (iii) All Consents Obtained No consents, approvals, permissions, authorizations, orders or licenses of any person or of any Governmental Authority (except for the issuance of Government Approvals by the City for construction of the Project) is necessary in connection with the execution, delivery and performance of this Lease or any transaction contemplated hereby, except as may have already been obtained by Developer prior to the Effective Date There is no provision in Developer's articles of incorporation, bylaws or other corporate documents that would be contravened by the execution and delivery of this Lease or the perfonmance of any provision, condition, covenant or other tern required to be performed by Developer under this Lease (iv) Availability of Construction and Equity Financing for Project. Prior to exercise of the Option to purchase the Option Property, Developer has obtained a commitment for a construction loan from a Construction Lender in an amount which together with any equity funding obtained by Developer is sufficient to complete the construction of the Project and prior to Closing of its purchase of the Option Property, Developer has satisfied all conditions precedent to (a) initial disbursement of loan proceeds by the Construction Lender for construction of the Project (subject only to issuance of all Discretionary Permits, the Construction Permits and other Government Approvals necessary to construct the Project), and (b) contribution of equity from all equity investors under the terms of such investors' contribution or other investment agreements and is prepared to close any construction loan financing or equity funding simultaneous with the Closing of the purchase of the Option Property. (v) No Litigation There is no pending or, to Developer's Knowledge. threatened litigation, tax claim, action, dispute or other proceeding of any nature whatsoever affecting John A Goodman or Developer which could have a material adverse effect on the legal existence, power or operations of Developer or the financial condition of John A Goodman or Developer. or have a material adverse effect on the ability of John A Goodman to perform his obligations under the Completion Guaranty or the obligations of Developer to perform its obligations under this Lease and neither John A. Goodman or Developer is in default with respect to any Requirements of Law that might result in any such effect. (vi) Development of Project. Developer represents and agrees that if Developer exercises the Option to purchase the Option Property, the Option Property will be used solely for the purposes of timely development of the Project and not held by Developer for speculation. -25- P120399 DRS120399 31R 09130/11 Developer represents to City that subject to the approval for issuance of all necessary permits and approvals it will Commence Construction of the Project on the Option Property withm forth-five (45) Y days following Closing and thereafter diligently and continuously prosecute such construction to completion so as to achieve Final Completion of the Project within thirty (10) months following Commencement of Construction, subject to events of Force Majeure This representation shall survive Closing and delivery of the Deed. (vii) Developers Knowledge. As used herein, the term "Developer's Know ledge'' means the actual knowledge of John A Goodman, Chairman of Developer and Brad Reisinger as to the matters set forth in Section 15 B(i)- (v) inclusive, and to the actual knowledge of Brad Reisinger as to the matters set forth in Section 15 B(v i) In the event that after the Effective Date and prior to the Closing Date, Developer becomes aware of the existence of any fact that makes any of the representations set forth above no longer true and correct,Developer shall promptly notify City of the same. If and to the extent of disclosure by Developer of any such change in its representations. City may elect to terminate this Lease (and the Option to purchase the Option Property contained herein)without liability to Developer on or before the date that is the later of(i)five (5) Business Days after City's receipt of such notice, or(ii) if Developer has exercised the Option to purchase the Option Property. the Closing Date, and the Closing Date shall be extended, if required to provide City with a mmimum of five (5) Business Days to evaluate such additional information. 16. "AS-IS" Sale If Developer exercises the option to purchase the Option Property, Developer acknowledges that it has had an opportunity to and has conducted a thorough investigation of the Option Property and is in all respects knowledgeable and familiar with the present condition and state 1 of repair of the Option Property Developer acknowledges that it will be concluding the purchase of the Option Property based solely upon Developer's inspection and investigation of the Option Property and that the Option Property is being sold to Developer in an "AS-IS" condition and state of repair, and with all faults, of any kind or nature and without any representations or wairanties, express. implied or statutory, EXCEPT AS SPECIFICALLY SET FORTH IN THIS LEASE, CITY MAKES NO REPRESENTATIONS OR WARRANTIES WHATSOEVER WITH RESPECT TO THE PHYSICAL CONDITION OR VALUE OF THE OPTION PROPERTY, THE PRESENCE OR ABSENCE OF HAZARDOUS SUBSTANCES ON THE OPTION PROPERTY, SOILS CONDITIONS, OR OTHER PHYSICAL CI-FARACTERISTIC OF THE OPTION PROPERTY OR THE SUITABILITY OF THE OPTION PROPERTY FOR DEVELOPER'S INTENDED DEVELOPMENT CITY MAKES NO REPRESENTATION WHATSOEVER REGARDING THE FINANCIAL FEASIBILITY OF THE PROPOSED REDEVELOPMENT OF THE OPTION PROPERTY Upon recording of the Deed to the Option Property, Developer shall be deemed to have accepted the Option Property in its `AS-IS, WHERE-IS" condition and state of repair and does hereby waive and release the City, its officials, officers, employees and agents from any and all claims for damages, losses, liabilities, costs and expense whatsoever (including, without limitation. reasonable attorneys' fees and costs), 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 Option Property or any Requirements of Law-applicable thereto 17 Conditions Precedent to Developer's Exercise of Option to Purchase the Option Property. As conditions precedent to the City's obligation to sell the Option Property to the Developer and Developer's exercise of its Option to purchase the Option Property, the following conditions must be met to the reasonable satisfaction of the City with respect to the Option Property prior to the Expiration Date as it may be extended herein: -26- P Q0399 DRSQ0399 31R 09MIll A. Approval of Financing Plan for the Project Developer nitends to finance the acquisition and construction of the Project on the Option Propem with construction loan financing and equity Developer shall make available copies of the following information for review by an authorized representative of City's consultant, National Development Council ("NDC") on the terms and conditions set forth herein The contents of all financial statements of John A Goodman or the Developer provided by Developer for review will be kept strictly confidential by NDC except to the extent required by law, will be reviewed by NDC in Developer's office or such other mutually convenient location and will not be copied or removed from Developer's offices, or released or summarized in writing to any other party. With the exception of the above-described financial statements. NDC shall have the right to make and retain copies of the following information- (1) Evidence reasonably acceptable to City of the source, availability and sufficiency of any debt and equity funding required to build the Project on the Option Property- Copies of executed contribution agreements from equity investors or executed commitment letter and loan documents from a Construction Lender reasonably acceptable to City and with terms and conditions reasonably acceptable to City (ii) Copy of Developer's organizational documents and, if Developer proposes to assign the Option to purchase the Option Property to a limited partnership, a limited liability company or other entity, a copy of the proposed limited partnership agreement of limited liability company agreement or other organizational documents togethei with evidence that any such assignment complies with the requirements of Section 13 D above (iii) Project Budget for the Project. (iv) Construction Contract for the Project consistent with the Project Budget, including the name of the general contractor, which shall be a general contractor licensed in the State of Washington reasonably acceptable to City (v) Upon approval of the information, documents and agreements set forth in this subsection A, such documents and the intended financing of the Project, shall constitute the Approved Financing Plan for the Project. Any material change to the Approved Financing Plan for the Project must first be made available for review on the terms and conditions set forth herein and approved by City which approval shall not be unreasonably withheld B Funding of Construction Loan and Equity Investments Developer has provided evidence reasonably satisfactory to City and NDC that (i) All conditions precedent to the funding of any equity required under the Approved Financing Plan for the Project shall have been met or waived, and that the equity investors are in a position to close their respective equity investments simultaneous with closing of the sale of the ; Option Property. (ii) All conditions precedent to closing and funding of any construction loan approved as part of the Approved Financing Plan for the Project have been met or waived and the Construction Lender has agreed to make the initial advance under its loan documents simultaneous with , the closing of the sale of the Option Property. C Discretionary Permits. City has taken action on Developer's application for downtown design review, which action is no longer subject to appeal. -27- P120399 DRS120399_31R D9130111 l D Construction Permits. City has approved for issuance all Construction Permits for the Project which are no longer subject to appeal 4 E. BoundM Line Adjustment Completed. The Boundary Line Adjustment has been approved and is ready for recordation on the Closing Date, F. Financial Assurances. Developer shall have posted such financial guarantees from a bank or othei entity reasonably acceptable to City as shall be required for performance under Government Approvals for the Project, in the form and amount required under the KCC Any payment and performance or completion bonds obtained by Developer shall name City as a co-obligee. G. Construction Contract Developer has provided the City with a true and correct copy of the construction contract for the Project(m substantially the same form as approved as part of the Approved Financing Plan) duly executed by Developer and the general contractor H. Completion Guaranty. Developer has provided a Completion Guaranty for the Project in favor of the City in substantially the form attached hereto as Exhibit N executed by John A. Goodman. I. Compliance by Developer. Developer shall have materially performed, observed i and complied with all of the covenants. agreements obligations and conditions required by this Lease to be performed, observed and complied with by it prior to or as of the Expiration Date. J. Correctness of Representations The representations of Developer set forth in this Lease shall be true and correct on and as of the date the Option is exercised and the Closing Date. K. No Bankruptcy Neither John A Goodman nor Developer- (a)has applied for or consented to the appointment of a receiver, custodian or trustee for any of his or its property, (b)has become insolvent, (c)has failed generally or admitted in writing his or its inability to pay his or 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, reorganization. insolvency, moratorium or similar statute or any other law or laws for the relief or of relating to debtors, or (f)has made an assignment for the benefit of his or its creditors or entered into an agreement of composition with his or its creditors, nor (g) has a petition been filed against John A Goodman or Developer. 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 The foregoing conditions contained in this Section 17 are solely for the benefit of the City If any of the foregoing conditions are not satisfied, the City shall have the right, at its sole election, to waive the condition and proceed with the sale of the Option Property. 18 Developer's Conditions Precedent to Closing of Purchase of Option Property If Developer elects to exercise the Option granted under Section 19 hereof, Developer's obligations to close the sale of the Option Property are subject to satisfaction of each of the following conditions, each of which is for the benefit of Developer and any or all of which may be waived by Developer in writing at its option. A. Compliance by City. The City shall have materially performed, observed and complied with all of the covenants, agreements, obligations and conditions required by this Lease to be performed, observed and complied with by it prior to the Closing Date, including approval of the Boundary Line Adjustment reconfiguring the Option Property in accordance with the ternis of this Lease. -28- P=399 DRSQ0399 31R WWII B. Correctness of Representations The representations of the City set forth in this Lease shall be true and correct on and as of the date the Option is exercised and the Closing Date C. Condition of Property. The City shall be in a position to deliver possession of the Option Property at Closing free and clear of all leases. liens and other exceptions (except for the Permitted Exceptions) City shall deliver a tennmation of the Surface Parkma Easement to the Escrow Agent for recordation on the Closing Date D. Title Policy. The Title Company shall be in a position to issue Developer the Title Policy in accordance with Section 14 and the Pro Forma Title Policy attached hereto as Exhibit P E Discretionary Permits All Discretionary Permits for the Project have been approved by the City and are no longer subject to appeal F. Construction Permits. The City has approved for issuance all Construction Permits for the Project The foregoing conditions contained in this Section 18 are solely for the benefit of Developer. If any of the foregoing conditions are not satisfied, Developer shall have the right, at its sole election, to waive the condition and proceed with the sale of the Option Property 19. Option to Purchase Option Property A Option to Purchase. Provided that Developer is not in default under this Lease (including payment of any Additional Rent then due and owing), and Developer has satisfied all of the Conditions Precedent to Developer's exercise of its Option to Purchase the Option Property set forth in Section 17, Developer shall have the option to purchase the Option Property (the -Option-) and thereby terminate this Lease at any time prior to the Expiration Date by giving notice of its election to exercise the Option, paying the Base Option Pi ice set forth in Section 19 C and delivering the documents required under Section 20 of this Lease B Exercise of Option Developer shall give written notice of its election to exercise its Option to purchase the Option Property by delivery of written notice to the City prior to the Expiration Date as it may be extended hereunder C. Payment of Base Option Price. The Base Option Price shall be Eight Hundred Two Thousand Dollars ($802,000)minus the Demolition Costs, payable in cash on the Closing Date. D. Contingent Payment Price. Developer and City have further agreed that in order to address variables in current market conditions including the market value of the Option Property and the Project, City shall also be entitled to a contingent payment (the -Contingent Pavment") under certain terms and conditions The Contingent Payment shall be an amount equal to the Demolition Costs as adjusted and payable in accordance with the terms of the Contingent Payment Agreement in substantially the form attached hereto as Exhibit K which by this reference is incorporated into this Lease as though fully set forth herein -29- P V0399 DRSQ0399 31R 09/30/11 20, Closing of Purchase of Option Propem,. A. Closmg Procedures (i) "Closm " shall occur when the Deed conveying title to the Option Property to Developer is recorded, the Base Option Pace has been disbursed to City and the Developer has executed and delivered the Contingent Payment Agreement and other documents required under Section 20 C below to City The Closing shall be held at the offices of Escrow Agent The Closing Date shall be on a date designated by Developer which shall be on a Business Day not less than thirty(30)days nor more than ninety (90) days following exercise of the Option Such date may not be extended without the written approval of City and Developer except as otherwise expressly provided in this Lease All documents shall be deemed delivered on the date the Deed is recorded (ii) In the event the Closing does not occur on or before the Closing Date, Escrow Agent shall. unless it is notified by both parties to the contrary within five (5) days after the Closing Date. return to the depositor thereof items which may have been deposited hereunder. Any such return shall not, however, relieve either party hereto of any liability it may have for its wrongful failure to close B. Delivery by City On or prior to the Closing Date, City shall deposit with Escrow Agent, and shall deliver copies to Developer to the extent not previously delivered prior to the Closing,the following (i) The Boundary Line Adjustment(if not previously recorded); (u) A termination of the Surface Parking Easement executed by City in recordable form; (iii) The Deed to the Option Property in the form attached hereto as Exhibit I executed by City in recordable form conveying fee simple title to the Option Property free and clear of all liens and encumbrances, except for the Permitted Exceptions, together with a duly executed real estate affidavit, (iv) Duplicate originals of the Contingent Payment Agreement, executed by City, including a Memorandum of the Contingent Payment Agreement (the "Contingent Payment Memorandum") executed by the City in recordable form in the form attached hereto as Exhibit K, (v) The Public Parking Easement executed by City in recordable form in the form attached hereto as Exhibit L; (vi) Affidavit executed by City which satisfies the requirements of Section 1445 of the Unites States Internal Revenue Code regarding foreign investors; (vu) City shall cause the Title Company to issue the Developer the Title Policy, (viii) Such resolutions, authorizations, certificates or other corporate• documents or agreements relating to City as shall be reasonably required by Developer or the Title Company in connection with this transaction; and (ix) City's share of Closmg Costs. -30- P V0399DRSQ039931R D9/30/1,I C Delivery by Developer. On or before the Closing Date, Developer shall deposit with Escrow Agent the Option Price (Jess the Contingent Pa ment and any adjustments authorized under this Lease)and shall deposit the following (i) The Deed duly executed by Developer in recordable form, together with a duly executed real estate excise tax affidavit, (it) Duplicate originals of the Contingent Payment Agreement executed by Developer in the form attached hereto as Exhibit K. including the Contingent Payment Memorandum executed by the Developer in recordable form, (iii) The Public Parking Easement duly executed by Developer in recordable form in the form attached hereto as Exhibit L. (iv) The Completion Guaranty duly executed and delivered by John A. Goodman, (v) Such resolutions, authorizations, certificates or other ordinances or agreements relating to Developer as shall be reasonably required by City or the Title Company in connection with this transaction, and (vi) Developer's share of Closing Costs D. Citv's Closing Costs. In connection with the Closing, the City shall pay the real estate excise tax, if any,the cost of the Title Policy with Lability in an amount equal to the Option Price to the extent of the premium for standard owner's coverage. all permitting and third party costs associated with the Boundary Line Adjustment, one-half of the escrow fees and the City"s attorney's fees. E Developer's Closing Costs In connection with the Closing, Developer shall pay the cost of the Title Policy to the extent in excess of the premium for standard owner"s coverage together with all endorsements to the Title Policy requested by Developer, one-half of the escrow fees. all E recording fees. all costs associated with Developer's financing, including title premiums and recording costs and Developer's attorney's fees F. Prorations All revenue and all expenses of the Option Property (other than real property taxes)to the extent not otherwise payable by Developer under this Lease shall be prorated as of the Closing Date Because the City is exempt from property taxes, no proration of property taxes, special assessments or surface water management charges is required, however, Developer shall be responsible for payment of all property taxes, including special assessments and surface water management charges which affect the Option Property,from and after the Closing Date G. Recordation and Delivery of Documents. Provided that Escrow Agent has not received prior written notice from either party that any condition set forth elsewhere in this Lease has not been fulfilled, Escrow Agent is authorized and instructed to take the following actions and record the following documents in the official records of King County, Washington at 8.00 a.m (or as soon thereafter as possible) on the Closing Date pursuant to joint escrow instructions to be executed by City and Developer (i) Record the Boundary Line Adjustment (if not previously recorded), the termination of the Surface Parking Easement, the Deed, the Contingent Payment Memorandum and the Public Parking Easement, -31- P W399 0RS=399 31R 09/30111 { (ii) Deliver the affidavit described in Section 20 B(vi)to Developer; (iii) Assemble and deliver one fully executed counterpart of the Contingent Payment Agreement to both City and Developer, (iv) Deliver the documents described in Section 20 B to Developer and deliver the documents described in Section 20.0 to City. H. Notification, Closing Statements If Escrow Agent cannot comply with the instructions herein and to be provided within the time period set by the parties. Escrow Agent is not authorized to cause the recording of the foregoing documents If Escrow Agent is unable to cause the recording, Escrow Agent shall notify City and Developer at the addresses set forth in Section 25 below and shall, upon five (5) days prior written notice, return automatically all documents and monies to the parties depositing the same, whereupon Escrow Agent shall be released from all further obligations as escrow agent hereunder Promptly following the Closing Date, all closings statements and documents to be delivered to City and Developer shall be delivered to City and Developer at the address set forth in Section 25 below. I. Possession. Developer shall be entitled to possession of the Option Property on Closing, free and clear of all liens, leases, encumbrances and exceptions other than the Penmtted Exceptions and all liens, encumbrances or other exceptions arising through the actions of Developer or any of the Developer Parties or any of their respective agents, employees or consultants 21. Default A. Developer Default The following events will constitute an "Event of Defaulf' by Developer- (1) If Developer fails to pay Rent, Additional Rent, Taxes prior to delinquency, permitting or other fees payable to the City in connection with obtaining any Government Approvals required to construct the Project, fails to maintain insurance that substantially complies with Section 11, or fails to pay any other amount required to be paid by Developer under this Lease within ten (10) days of the date when due, or (ii) If Developer fails to perform any material obligation under this Lease, including any failure to commence or complete demolition of the Existing Improvements or apply for Governmental Approvals on or before the dates set forth on the Development Milestone Schedule attached hereto as Exhibit G, or (iii) If Developer assigns, pledges or encumbers its rights, duties or obligations under this Lease in violation of this Lease; or (iv) If any representation made by Developer set forth in Section 15 B is untrue or breached in any material respect and Developer fails to notify City as required therein; or (v) If a petition for bankruptcy is filed by or against John A Goodman or Developer or if John A Goodman or Developer makes a general assignment for the benefit of his or its creditors, or if a receiver is appointed on account of his or its insolvency and any such petition or appointment is not dismissed within sixty (60)days -32- P M399 DRS=399 31R 09/30/11 B. City Remedies upon Developer Event of Default Upon any Event of Default by Developer,the City shall give Developer written notice of the same, whereupon following receipt of such written notice 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), except with respect to Events of Default set forth in Section 21 A(i), (in), (iv) or (v) for which no cure period exists beyond the time period stated therein In the event Developer fails to cure such Event of Default within the time period set forth above. then the City may; (a)recover Rent Additional Rent, Taxes. permitting and application fees and any and all other monetary charges then due and payable by Developer under this Lease, together with interest thereon at the rate of eight percent (8%) per amium from the date due until paid in full, (b)terminate this Lease(including the Option to purchase the Option Property) by gn ing Developer thirty (30) days prior written notice of such termination, or (c) seek specific performance of this Lease as its sole and exclusive remedies for such default. C. City Ri}ht of Repurchase. If and only if there is an Event of Default under Section 21 A(iv) by reason of a breach of the representation of Developer set forth in Section 15 B(vi) with respect to Commencement of Construction of the Project within forty-five (45) days following Closing then, in addition to its iiaht for specific performance, City shall have the right upon written notice ("Repurchase Notice") to Developer and Developer's Construction Lender delivered within sixty (60) days following Closing to repurchase the Option Property for a purchase price equal to the Base Option Price paid by Developer to City at Closing Closing of the City's repurchase shall occur within ninety (90) days following Developer's receipt of City's Repurchase Notice and Developer shall transfer title to the Option Property by bargain and sale deed, free and clear of all liens and encumbrances except Pennitted Exceptions and any other exceptions consented to by City prior to Closmg Developer shall pay all amounts outstanding under the Construction Loan, if any, in excess of the Base Option Price necessary for City to obtain fee title to the Option Property- flee and clear of all liens except Permitted Exceptions and any other exceptions consented to by City prior to Closing The Escrow Agent shall conduct the Closing and Closing costs and prorations shall be allocated between seller and buyer in the same manner as provided in Section 20 of this Lease If the City fails to timely deln er the Repurchase Notice to Developer and Developer's Construction Lender or if City notifies Developer and Developer's Construction Lender that it intends to repurchase the Option Property, but fails to close the repurchase within ninety (90) days thereafter, City shall not be in default under this Lease, but City's right to repurchase the Option Property as a remedy for Developer's breach of its representations regarding Commencement of Construction of the Project on the Option Property shall terminate The provisions of this Section 21.0 shall survive Closing and recording of the Deed and City shall have a right to record a Memorandum of such Repurchase right in a fonm reasonably acceptable to both parties upon Closing. In addition, and in express consideration of Developer's agreement to the City's right of repurchase as set forth herein, if Commencement of Construction occurs within forty-five (45) days of Closing as contemplated in Section 15 B(vi), City agrees to execute and deliver to Developer and Developer's Construction Lender within five (5) days of Commencement of Construction a written acknowledgment that Commencement of Construction has occurred as required herein and City's repurchase right hereunder is thereupon terminated and of no further force or effect At Developer's request the City's written acknowledgement shall be in recordable form and if City has recorded a Memorandum of Repurchase Right, a termination of such memorandum in recordable form. D. City Default. Remedies. If the City fails to perform any material obligation under this Lease, Developer shall give the City written notice of same, whereupon following receipt of such written notice,the City shall ha-k e 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 the City fails to cure such failure -33- P=399-DRSQ0399 31R D913DI11 within the time period set forth above and provided Developer is not in default hereunder.Developer shall z have the right as its sole and exclusive remedy to either (a) seek and obtain specific performance of the City's obligations hereunder or (b)terminate this Lease by giving City written notice of such termination in which case City shall reimburse Developer the Demolition Costs without interest within one hundred twenty(120)days thereafter E. Waiver of Consequential and Punitive Damages. Each of City and Developer waive any right to sue the other part) for consequential, incidental or punitive dainages. The provisions of this Section 21 E shall survive Closing or ternmation of this Lease. Nothing contained herein is intended to waive either paity's right to indemnification under Section 11, the City's right to recover Rent, Additional Rent. Taxes, permitting and application fees or any other amount which Developer is obligated to pay, whether characterized as Additional Rent or otherwise, under this Lease, or Developer's f rights to reimbursement of Demolition Costs as set forth herein F. Rights and Remedies Cumulative Except as otherwise expressly stated in this Lease, the rights and remedies of the parties are cumulative, and the exercise or failure to 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. 22. Hazardous Substances. Except in accordance with Environmental Laws, Developer shall 1 not cause or permit any Hazardous Substances to be brought upon, kept or used in or about the Leased Premises or Property by Developer, any of the Developer Parties or any of their respective agents, employees, contractors or invitees, without the prior written consent of City If Developer breaches its obligations set forth above or if the presence of Hazardous Substances on or about the Leased Premises or the Property, caused or permitted by Developer or any of the Developer Parties results in contamination of the Leased Premises or the Property, then Developer shall protect, defend, indeinify and hold City harmless from and against any and all claims, judgments damages, penalties, fines, costs, liabilities or losses (including, without]imitation.diminution in value of the Leased Premises or the Property, damages arising from any adverse impact on marketability of othei properties owned by City, and sums paid in settlement of claims, attorney s fees, consultant fees and expert fees)which arise during or after the Term of this Lease as a result of such contamination If the presence of any Hazardous Substance on or about the Leased Premises or the Property caused or permitted by Developer or any of the Developer Parties results in any contamination of the Leased Premises, the Property or surrounding area, or causes the Leased Premises, the Property or surrounding area to be in violation of any Environmental Laws, Developer shall promptly take at its sole expense all actions necessary to return the Leased Premises, the Property and surrounding area to the condition existing prior to the introduction of such Hazardous Substance and in compliance with applicable Environmental Laws, provided that City's approval shall first be had and obtained, which approval shall not be unreasonably withheld so long as such actions would not potentially have any material adverse long-tern or short-tens effect on the Leased Premises, the Property or surrounding area This indemnification shall survive the expiration or other termination of this Lease and/or the Closing and recording of the Deed Nothing contained in this Section 22 shall be deemed to constitute or create an obligation of either party to indemnify the other party for Hazardous Substances existing on the Leased Premises or Property prior to the Effective Date of this Lease nor shall either party be required to remediate any Hazardous Substances existing on the Leased Premises or Property prior to the Effective Date of this Lease as part of its obligations to the other party under this Lease. Developer shall promptly notify City in writing if it discovers Hazardous Substances on the Leased Premises or the Property. 23. Time of the Essence. The parties agree that time is of the essence in the performance of every covenant, term, condition, and obligation to be performed hereunder. All periods of time referred to herein shall, unless otherwise expressly provided herein, include Saturdays, Sundays and legal holidays -34- P120399 DR&20399 31R 09/30/11 .1 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. 24 CitY s Right to Enter the Leased Premises. City reserves and shall have the right to enter the Leased Premises at ieasonable tines for the below listed purposes Gt} shall not be liable in any manner for any inconvenience, annoyance or disturbance to Developer or for any other damages arising out of City's entry onto the Leased Premises as provided in this Section 24: 1 u A. Condition. To determine whether the Leased Premises are in good condition and whether Developer is comply with its obligations under this Lease B. Notices. To serve, post or keep posted any notices required or allowed under the i provisions of this Lease 25. Notices Any notices or other communication which City or Developer shall desire or be required to give pursuant to the provisions of this Lease shall be in writing and shall be personally delivered or sent by regular mail and registered or certified mail or by facsimile transmission The giving of such notices shall be deemed complete on the third (3rd)Business Day after the same is deposited in a United States Post Office with postage charges prepaid or on the date v,hen delivered or faxed (provided the fax machine has issued a printed confirmation of receipt). All notices shall be addressed to the j persons intended to be given such notice at the respective addresses set forth below or to such other address as such party may theretofore have designated by notice pursuant to this Section 25• Address of City: City of Kent 400 W Gowe Street Kent. Washington 98032 Attention Kurt Hanson,Economic Development Manager Facsimile. (253) 856-6770 With a copy to: City of Kent 220 Fourth Avenue South Kent, Washington 98032 Attention City Attorney Facsimile: (253) 856-5706 Address of Developer: Goodman Real Estate,Inc. 2801 Alaska Way, Suite 310 Seattle, Washington 98121 Attention George Petrie, President Facsimile: (206) 215-9789 Any party may change the address to which notices shall be sent by notice to the other party in the manner and with the effect set forth in this Section 25 -35- P=399DRSQ039931R 09=111 26. Surrender. A. Surrender Developer shall, on the last day of the Term of this Lease or upon any earlier termination of this Lease (except any termination as a r esult of Developer s exercise of its Option to purchase the Option Property). surrender and deliver possession of the Leased Premises to City, free and clear of all Liens other than those existina on the date of this Lease and those, if any, created or consented to by City b B. Failure to Surrender If Developer fails to surrender the Leased Premises to City on the Expiration Date. Developer shall pay City monthly rent in an amount equal to one hundred fifty percent(150%) of the then fair market rental value for the Leased Premises as seasonably determined by City City and Developer agree that the Prepaid Rent payable by Developer under this Lease was a negotiated figure taking into consideration among other criteria, Developer's agreement to undertake the demolition of the Existing Improvements and the design and development of the Project, and that the fair market rental value for the Leased Premises would be greatly in excess of the Prepaid Rent. Nothing contained herein shall constitute the consent, express or implied, of City to the holding over of Developer r after the expiration or earlier termination of this Lease C. Holding Over. If Developer, with City's consent remains in possession of the Leased Premises after expiration or termination of the Tenn, or after the date in any notice given by City to Developer tenninatmg this Lease, such possession by Developer shall be deemed to be a month-to- month tenancy terminable on twenty (20) days prior written notice given at any time by either party During such month-to-month tenancy, Developer shall pay all Rent required by this Lease as detennrned in accordance with Section 26 B All provisions of this Lease, except those pertaining to Term and the Option to purchase the Option Property, shall apply to the month-to-month tenancy 27. Miscellaneous. A. Entire Agreement. This Lease,the Right of Entry-Agreement and any exhibits or attachments hereto and forming a part hereof. set forth the entire agreement of Developer and City concerning the Leased Premises (includes the Option to purchase the Option Property) and there are no other agreements or understandings, oral or written, between Developer and City Any subsequent modification of this Lease shall be binding upon Developer and City only if reduced to writing and signed by the party intended to be bound B. Non-Waiver No waiver of any breach by either party of any term, covenant, condition or agreement herein and no failure by either party to exercise any right or remedy in respect to any breach hereunder, shall constitute a waiver or relinquishment for the future of any such term, covenant, condition or agreement or of any subsequent breach of any such tern, covenant, condition or agreement, nor bar any right or remedy of such party in respect of any such subsequent breach. nor shall the receipt of any Rent, or any portion thereof by City operate as an accord and satisfaction or a waiver of the rights of City to enforce the payment of any other Rent then or thereafter in default, or to terminate this Lease, or to recover possession of the Leased Premises or to invoke any other appropriate remedy which City may select as herein or by law provided. No waiver of any term. covenant, condition, provision or agreement under this Lease shall be deemed to have been made unless in writing and signed by such party C. Construction. Each agreement. term, and provision of this Lease to be performed by Developer or City shall be construed to be both a covenant and a condition Each party will carry out its obligations under this Lease diligently and in good faith Section captions contained in this Lease are included for convenience of reference only and form no part of the agreement between the parties. As -36- P 120399 DRS120399 3IR 09130111 f used in this Lease, the masculine shall include the feminine and neuter the feminine shall include the masculine and neuter, the neuter shall include all genders, the singular shall include the plural and the plural shall include the singular, as the context may require. D. Severabil If any provision of this Lease or the application thereof to any person or circumstance shall to any extent be mvalid of unenforceable, the remainder of this Lease, or the application of such provision to persons or circumstances other than those as to which it is invalid or unenforceable, shall not be affected thereby. and each provision of this Lease shall be Nalid and enforceable to the fullest extent permitted by law E. Neutral Authorship. The provisions of this Lease shall be construed as a whole according to their common meaning and not strictly for or against any party and consistent with the provisions contained herein in order to achieve the objectives and purposes of this Lease Each party hereto and its counsel has reN sewed and revised this Lease and agrees that the normal rules of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be a construed in the interpretation of this Lease F Nature of Relationship The relationship between the City and Developer under this Lease shall be solely that of landlord and tenant and seller and buyer of real property(if the Option is exercised) It is not intended by this Lease to, and nothing contained in this Lease or the Option to purchase the Option Property granted herein shall, create any partnership, Joint venture or other arrangement bem een Developer and City. G. No Brokers. City and Developer each represent to the other that neither is represented by any broker, agent or finder with respect to this Lease(or the Option to purchase the Option Property contained herein) in any manner Each party agrees to indemnify and hold the other party harmless fi-om and against any and all liability, costs, damages, causes of action or other proceedings instituted by any broker, agent or finder, licensed or otherwise. claiming through, under or by reason of the conduct of the indemnifying party in any manner whatsoever in connection with this Lease or the option to purchase the Option Property contained herein, which indemnification shall survive the expiration or earlier tennmation of this Lease, or the Closing of the sale of the Option Property and recording of the Deed H. Survival. All provisions of this Lease which involve obligations, duties or rights which have not been determined or ascertained as of the Closing Date and all representations. warranties, covenants, agreements and mdenuvfications made in or pursuant to this Lease shall survive the expiration or tennmation of this Lease or the Closing of the sale of the Option Property and the recording of the Deed. I. Recording of Memorandum. Neither City nor Developer shall record this Lease without the written consent of the other party, provided, however, that either City or Developer shall have the right to record a Memorandum of this Lease in a form reasonably acceptable to both parties J. Covenants to Run with the Land The terms, covenants, agreements and conditions herein contained are and shall be deemed to be covenants running with the land and the estate created by this Lease and, subject to the provisions of Section 13 hereof, shall bind and inure to the benefit of the parties hereto and their respective successors and permitted assigns K. Nondiscrimination Developer will not discriminate and shall ensure that all contractors engaged by Developer in connection with the Project comply with all applicable federal, state and local discrimination laws, rules and regulations 37- P 12 0399 R_D Sf20399 31R 09/30/11 L. No Third Part,,, Rights The provisions of this Lease 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 benefit of any contractor. architect, consultant, subcontractor, worker, supplier, mechanic architect. insurer, surety, lender, mvestor, guest, tenant, member of the public, or other third parties having dealings with any of the parties hereto or involved, in any manner_ in the Properq. M. Non-Waiver of Governmental Rights. Nothing contained in this Lease shall require City to take any discretionary action relating to development of the improvements to be constructed on the Option Property as part of the Protect, including. but not limited to, zoning and land use decisions,permitting, design review or any other governmental approvals. N. Further Assurance Each party hereto agrees that it will execute or furnish such documents and further assurances to the other or to pioper authoiities as may be necessary for the full implementation and consummation of this Lease and the transactions contemplated hereby O. 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 P. WAIVER OF JURY TRIAL. CITY AND DEVELOPER HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM ARISING OUT OF THIS LEASE, 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 Q. Conflicts of Interests. No member, official or employee of City shall make any decision relating to this Lease 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 R. 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, in 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 Lease S. Applicable Law. This Lease 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 Lease 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 T. Counterparts This Lease 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 -38- P120399 DRS\20399 31R 09/30/11 U Attorneys' Fees Except as otherwise expressly provided herein, each party shall 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 othem ise arising out of this Lease. [Remainder of page intentionally left blank Signature page follows J -39- P120399 DRS120399 31R 09/30/11 LN WITNESS WHEREOF,the parties have executed this Lease as of the day and year first above written. "Developer" "City" GOODMAN REAL ESTATE,INC ,a Washington CITY OF KENT, a Washington municipal corporation corporation R By: ByA. jM— o Title• Tit 'Date: Da d APPROVED AS TO FORM: g By e�r�kX V2�k4 Name MbAk U Title. CrtTY /0't09NVY STATE OF WASHINGTON ) ss. COUNTY OF KING } On this day o4 `p'(011 before me personally appeared 6i e- rr and said person acknowledged that he signed this instrurrif,11t. and on oath stated that lie was authorize execute the insnurnent and acknowledged it as the of CITY OF KENT. a Washington municipal corporation, to be the free and volunt t of such party for the uses and purposes mentioned in the instrument In Witness Whereof I have hereunto set my hand and affixed my official al the day and year first above written. .��G•( A. k ��fj� Notary Public Print Name f�l 2Yr C)+� My commission expires i Alin '� �OF WPS��•��` (Use tins space for notarial stamp/seal) a IN WITNESS WHEREOF,the parties have executed this Lease as of the day and year first above written. 1 "Developer" "City" GOODMAN REAL ESTATE,INC., a Washington CITY OF KENT,a Washington municipal corporation corporation i� i By: By d Title: Title: Date: Date- APPROVED AS TO FORM: 0 By- i Name Title STATE OF WASHINGTON ) )ss. COUNTY OF KING ) On this day of 2011 before me personally appeared and said person acknowledged that he signed this instrument, and on oath stated that he was authorized to execute the instrument and acknowledged it as the of CITY OF KENT, a Washington municipal corporation, to be the free and voluntary act of such party for the uses and purposes mentioned to the instrument In Witness Whereof I have hereunto set my hand and affixed my official seal the day and year first above written Notary Public Print Name My commission expires (Use this space for notarial stamp/seal) STATE OF WASHINGTON ) )ss. } COUNTY OF KING ) On this day of 2011, before me personally appeared eo 2 fe*re- to me known to Atheind vidual described in and who executed the within itt trument, and acknowledged that_signed and sealed the same as the free and voluntary act and deed of the GOODMAN REAL ESTATE, INC, a Washington corporation, for the purposes and uses therein mentioned, and on oath stated that was duly authorized to execute said document t T, In Witness Whereof I have hereunto set my hand and affixed my official seal the day and year first above written 'SA BE9T���ii r Notary Public �Q SsionF Print Name My commission expires / PUBOG 02-23-20�a Cj�O2� 8 (Use this space for notarial stamp/seal) EXIIIBIT A { Legal Description of Property Certain real property located at 430 West Smith Street, Kent, situated in King County, Washington and more particularly described as follows PARCELS A, B AND C, CITY OF KENT LOT LINE ADJUSTMENT NO LL-2005-37, G RECORDED JANUARY 10, 2006 UNDER RECORDING NO 20060110002592 IN KING COUNTY, u WASHLNGTON TAX PARCEL NOS 982570-0520. 982570-0515, 982570-0505 A-1 P 120399_DRS120399 31R 09130M1 EXHIBIT B Lesal Description of Leased Premises Certain real property located at 430 West Smith Street, Kent, situated in King County, Washington and more particularly described as follows: PARCELS A AND B, CITY OF KENT LOT LINE ADJUSTMENT NO. LL-2005-37. RECORDED JANUARY 10, 2006 LNDER RECORDING NO 20060110002592 IN KING COUNTY, WASHINGTON TAX PARCEL NOS. 982570-520: 982570-0515: 982570-0505 Together with temporary construction easement over portions of Parcel C as depicted on Exhibit D. a B-I P Q0399_DM20399_31R OW30111 EDIT C 5 Legal Description of Option Property Certain real propem, located at 430 West Smith Street, Kent, situated in King County, Washington and more particularly described as follows. F PARCELS A, B, AND A PORTION OF PARCEL C, CITY OF KENT LOT LINE ADJUSTMENT NO LL-2005-37, RECORDED JANUARY 10, 2006 UNDER RECORDING NO 20060110002592 IN KING COUNTY, WASHINGTON, AS DEPICTED ON EXHIBIT D TAX PARCEL NOS 982570-0520, 982570-0515, 982570-0505 The Option Property does not include the remainder of Parcel C, City of Kent Lot Line Adjustment No LL-2005-37. City and Developer shall agree on the final configuration of the Option Property during the Lease Term, and the City shall process and record a boundary line adjustment necessary to establish the Option Property as one or two separate legal lots prior to Closing The City shall retain ownership of the remainder of Parcel C following the recording of the Boundary Line Adjustment C-1 F 130399 7RSM399 31R OW30/11 EDIT D s Map of Property D-1 P120399_DRS'20399_31R D913D711 i 4th Ave N aw pot- ,aw 40 14 9 q.�z� zx use erra��� ell cn r � 10 t IM �(D Lot B POO MAN a� � M1jk Y .at... a 2nd Ave N EXHIBIT E Kent City Center Design Principles a. Project design at the corner of West Smith Street and 4th Avenue North to convey architectural prominence with a marquee style building signage feature and building facadeirooflme treatment consistent with new,market rate urban properties. b. Project design will promote a positive pedestrian experience at the street level along the West Smith Street frontage by incorporating shallow retail spaces with a pedestrian friendly modulating storefront-t\pe treatment for the majority, of the overall frontage length This retail component will screen the surface structured parking and activate the streetscape while avoiding blank facades. c Project design to include a buffer zone between Town Square Plaza Park and the building 1 structured parking and apartment unit facades. by incorporating the use of a pedestrian pathway and raised planters with shrub and tree screening d. Project design to incorporate significant scale fenestration patterns with Juliet style balconies and strong architectural modulation and facade character e. Project design to incorporate the use of quality exterior materials with an emphasis on a building facade that expresses a base, middle and top f. Project design will include amenities which are deemed appropriate for the market place and urban setting, E-1 P 120399 DRS120399 31R 09/30111 i EXHIBIT F Planned Action Ordinance F .e } a F-1 P=399_DRSW399_31R 09/30/11 Retum Address: Attn: City Clal: Z20 of ugh 20030807000823 220 Fourth Ave.5, Kent,_WA 48032 KENT CITY OF CORD 63,00 e5ja 001 OF 035 KING7000NTY,tIJAZ Rkkkk#k#kM/k/#tk//tk#rt#t#tkkkttkrtikt##t#kk/i#tktrtsttrtkMtkrttt#/tkkt//M/Fk///t/#ikk//M#///#/ WASHINGTON STATE COUNTY AUDITORIRECORDER'S COVER SHEET Document Title: City of Kent Ordinance No.3608 establishing a Planned Action for a site approximately 25.0 acres in size,as described in the adopted Kent Station Supplemental Environmental Impact Statement E Reference Number: NIA Grantor(s): City of Kent Grantee(s): The Public I Ordinance No.3608 Abbreviated Legal Description: 5E %y Section 13,Township 22,Range 4E;NE'l.of NE %,Section 24,Township 22,Range 4E Additional legal description is on Page 34(Exhibit C)of document Assessor's Property Tax Parcel/Account Number(s): 7142800000, 7142800005, 7142800021, 7142800025, 71428000659 71428001909 7142800135, 7142800160, 7142800165, 7142800170, 7142800171, 71428001809 7142800185, 7142805555, 2422049010, 2422049126, 2422049127, 7422049144, 24220455551, 98257004459 98257004959 98257005059, 9825700510, 9825700515, 982570052% 9825700535, 98257055550 ORDINANCE NO. �� AN ORDINANCE of the City Council of the City of Kent, Washington, establishing a Planned Action for a site approximately 25 0 acres in size, bound by dames and Harrison Streets, 40' Avenue and l" Avenue, as described in the adopted Kent Station Supplemental Environmental Impact Statement. WHEREAS, the Governor's Task Force on Regulatory Reform recommended changes to state law that would enable local governments to consolidate r environmental review of plans prepared under the Washington State Growth Management Act(GMA), and WHEREAS, both the State Environmental Policy Act ("SEPA") and Chapter 36 70B Revised Code of Washington C RCW') provide for the integration of environmental review with project review through the establishment of "Planned Actions", and WHEREAS, Planned Actions expedite the permitting process where substantial planning and environmental analysis have been done prospectively for specific geographic areas that are less extensive than the municipality's jurisdictional boundaries or that are for certain types of development, and 1 Planned Action Ordinance— Kent Station SKIS " WHEREAS, RCW 43 21C 031 and Washington Admtmstrative Code ("WAC") 197-11-164, -169, and -172 allow for and govern the application of a Planned Action designation, and WHEREAS, City of Kent Ordinance No 3222 adopted a Comprehensive Plan (April 1995), under the provisions of Chapter 36 70A RCIff, that includes goals and policies for Kent's downtown area; and WHEREAS, City of Kent Ordinance No 3398 adopted the Downtown Strategic Action Plan and Integrated Supplemental Environmental Impact Statement in 1998 as an amendment to the City of Kent Comprehensive Plan, in compliance with the requirements of the GMA to direct growth into urban centers that provide a mix of residential, commercial, educational, and recreational land uses served by a multi- modal transportation system, and WHEREAS,the City of Kent Downtown Strategic Action Plan provides a basis for master planning and environmental analysis for the subsequent adoption of a Planned Action Ordinance for the Downtown Kent subarea, and its component districts, and WHEREAS, City of Kent Ordinance 3543, passed on February 20, 2001, rezoned lands previously designated as Downtown Commercial Lunited Manufacturing (DLM) within Downtown Kent to Downtown Commercial Enterprise (DCE) and recognized the vanety of fanctions Downtown Kent will be expected to provide as a designated Urban Center pursuant to King County county-wide planning policies for population,employment and services; and WHEREAS, on February 8, 2001, the City purchased the Borden Chemical site, and 2 Planned Action Ordinance— Kent Station SEIS a WFIEREAS. the Sound Transit Commuter Rail Station began operation a in the City of Kent on February 5, 2001, and the presence of this transit service is consistent with and would enhance mixed-use development on the Planned Action site, and WHEREAS, the City of Kent over the years has provided an ongoing 1 opportunity for public participation and review process for preparation of its Comprehensive Plan, the Downtown Strategic Action Plan and Integrated Env7roninental Impact Statement, and the Kent Station Planned Action Ordinance, and WHEREAS, on July 9, 2002 the Kent City Council Planning Committee held a public meeting on this Planned Action Ordinance to allow an opportunity for public comment as required by WAC 197-11-168, and WHEREAS, the Kent Station Planned Action Supplemental Environmental Impact Statement (hereafter "SEIS'� identifies impacts and mitigation measures associated with the planned development,and WHEREAS, this Ordinance would designate certain land uses and activities as Planned Actions" that would be consistent with the Downtown Commercial Enterprise zoning district designations within Downtown Kent. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS SECTION 1. - Purpose The City Council declares that the purpose of this ordinance is to 3 Planned Action Ordinance— Kent Station SEIS A Combine environmental analysis with land use planning,and B. Streamline and expedite the land use permit process by relying on completed n and existing detailed environmental analysis for certain land uses allowed m Downtown Kent, and C. Set forth a procedure designating certain project actions within Downtown Kent as Planned Actions consistent with RCW 43 21C 031; and 1 k D Provide the public with an understanding of Planned Actions and how the City will process Planned Actions, and ( E. Adopt the SEIS as a Planned Action document that provides a framework for encouraging development proposals within the Planned Action Area described in Section 3(A) ("Planned Action Projects") that are consistent with the goals and policies of the City of Kent Comprehensive Plan and the City of Kent Downtown Strategic Action Plan, as they apply to a portion of the North Core District of Downtown Kent F Apply the City's development codes together with the SEIS and mitigation framework described in Section 3 of this Ordinance to expedite and simplify processing Planned Action developments, consistent with RCW 43 21 C 240 and WAC 197-11-158 4 Planned Action Ordinance— Kent Station SEIS 1 SECTION 2. -Findin The City Council finds that' A The City of Kent selects Alternative 2, as set forth in the SEIS, as its preferred alternative, and B. The City of Kent Comprehensive Plan Environmental Impact Statement, the City of Kent Downtown Strategic Action Plan and Integrated Supplemental Environmental Impact Statement (together "DSAP"), and the SEIS adequately address all significant environmental impacts associated with the Planned Action described in the SEIS for Alternative 2; and C. The mitigation measures contained in the Mitigation Document, Exhibit A of this Ordinance, together with the City's development standards and any future mitigation measures that may be imposed through the land use process, are adequate to mitigate the significant adverse environmental impacts of the Planned Action Projects addressed in the SEIS Additional voluntary nutigation measures may also be incorporated in a subsequent development agreement pursuant to RCW 36 70B 170; and D. The SEIS Planned Actions, also referred to as `Planned Action Projects" (as described by Alternative 2 in the SEIS), as set forth in Section 3(D) of this Ordinance, will benefit the public, will protect the environment, and will enhance economic development, and E The City has provided numerous opportunities for public involvement and review; has considered all comments received; and this public participation process has resulted in modifications to mitigation measures and Planned Action conceptual alternatives S Planned Action Ordinance— Kent Station SEIS yq3 S F. The Planned Action describes the location, types and quantities of uses anticipated. G. Public services and facilities are adequate to serve the proposed Planned Action, SECTION 3. -Procedure and Cntena for Evaluating and Determining Projects as Planned Actions A Planned Action Area. The Planned Action designation shall apply to all parcels bound by I"Avenue on the east between James and Smith Streets, 4`"Avenue on the west between James and Harrison Streets, James Street on the north between I"and 41" Avenues, and Harrison Street on the south between 2i6 and 4a' Avenues, referred to in this Ordinance as the "Planned Action site" The property is illustrated in Exhibit B and legally described in Exhibit C Additionally, the Planned Action designation shall apply to any off-site improvements necessitated by the proposed Planned Action development where the unpacts of the off-site improvements have been analyzed in the SEIS, B. Environmental Document A Planned Action designation for a site-specific Planned Action Project permit application shall be based on the environmental analysis contained in the draft SEIS issued by the City on April 23, 2002, and (' the Final SEIS issued by the City on July 8, 2002, and those environmental documents incorporated by reference or adopted in the SEIS. The Council's Mitigation Document, Exhibit A, is based upon the environmental analysis in the SEIS, and is incorporated into this Ordinance by this reference The Mitigation Document, together with existuig City codes, ordinances, development regulations and standards and applicable county, state or federal requirements and standards, shall provide the framework for the decision by the City to impose conditions on a Planned Action project Other environmental 6 Planned Action Ordinance— Kent Station SEIS documents incorporated by reference in the SEIS may also be utilized to assist in analyzing impacts and detemming appmpnate mitigation measures. C. Planned Action Designated Land uses and activities described in the SEIS, subject to the thresholds described in Section 3(D) and the mitigation measures described in the Mitigation Document, Exhibit A, are designated Planned Actions or Planned Action Projects pursuant to RCW 43.21C 431. A land use permit application for a site-specific Planned Action Project within the Subarea shall be designated as a Planned Action if it meets the criteria set forth in Section 3(D) of dus Ordinance and applicable laws, codes, development regulations and standards of the City D. Planned Action Thresholds. 1. Land Use Subject to the mitigation measures described in Exhibit A, the following land uses and development levels, together with the 1 customary accessory uses and amenities described in the SEIS, are Planned Actions pursuant to RCW 43 21C.031- a. Land uses The following uses are the pnmary uses analyzed in the SEIS. 1. Office, u. Retail commercial; in. Restaurant, IV Multifamily residential, ! V. Cinema, vi Community College; a vii Hotel &Conference Center, vui. Surface parking, ix Structured parking,and x Street and infrastructure improvements. 7 Planned Action Ordinance— Sent Station SEIS e 0 e a k b, Land Use Rew", Threshold The Planned Action designation applies to future development proposals that are comparable to or that are wrthut the range established by SEIS Proposed Action Alternative 2, as shown in the Summary of Development table below: Kent Station Alternative—Summary of Development in Alternative 2 Alternative 2— LAND USE Kent Station Proposal Commercial(square feet) 518,400 sf Retail 191,800 Restaurant 35,900 Grocery 47,700 Cinema(12-Screen;2,800 seats) 55,000 Office 138,000 Community College 50,000 Hotel/Conference Center 169,400 sf Hotel Rooms 200 moms Multi-family Residential(sq feet) 4349000 sf Housing Umts , 480 units �• Total Commercial/Residential 1,121,800 sf Development Park/Open Space 53,000 sf Civic Plaza(Alt 2)/Plaza Area(Alt 3) 23,000 Park Block(Alt 2)/Town Sq (Alt 3) 30,000 Borden Playfields 0 Parking(stalls) 2,932 stalls 8 PlannedAetion Ordinance— Kent Station SETS r y A list of general uses available to the land use categories featured in the above Summary of Development table, with appropnate development standards, is described in Kent City Code 15 04 Surface parking includes on- street spaces within the site, and structured parking includes `stand-alone' parking garages as well as parking structured within and beneath mixed-use development If future development proposals in the Planned Action area exceed the maximum development parameters reviewed in the SEIS, further environmental review may be required under SEPA, as provided in WAC 197- 11-172 If proposed plans significantly change the location of uses in a manner that would alter the environmental determinations in the SEIS, additional SEPA review also would be required Shifting the total build-out of square footage between uses may be permitted so long as the total build-out does not exceed the aggregate amount of development, trip generation, and parking thresholds reviewed under the SEIS, and so long as the impacts of that development have been identified and mitigated in the SEIS and the Mitigation Document 2 Building Heights and Thresholds. The Planned Action Area is entirely located within the Downtown Commercial Enterprise (DCE) zoning district Under Kent City Code 15 04190, there is no height limitation in the DCE zoning district. However, proposed building height is subject to Kent City Code 15 09 046 Downtown Design Review The building heights reviewed in the SEIS range from one story to six a stones In comparison with the building heights reviewed in the SEIS, a proposed increase in height greater than one (1) additional story may require additional SEPA review to address aesthetic impacts f 3 Building Setbacks, Building setbacks shall be established by existing development regulations and Downtown and Multifamily Design Review 9 Planned Action Ordinance— Sent Station SEIS a. +I 4 Oven Space. Open space shall be established by existing development regulations and Downtown and Multifamily Design Review. In no case shall The Civic Plaza and Park Block total less than 53.000 square feet, as analyzed in the SEIS Of this total, approximately 30,000 square feet will be developed by the City as a Park Block 5. Transportation. a Trip Ranges; The range of trips reviewed in the SEIS are as follows Trip Generation j Net New Trips Reviewed in SETS Time Period Total Inbound Outbound Trips Weekday Daily 13,200 6,600 6,600 Total Weekday PM Peak 1,380 675 705 Hour 1 b Trip Threshold Uses or activities that would exceed the maximum trip levels shown above will require additional SEPA review C. Public Works Discretion The Public Works Director shall have discretion to determine incremental and total trip generation, r consistent with the ITE Trip Generation Manual (latest ed), for each Planned Acton Project permit application proposed under tins Planned Action d Of-Site Mitigation- As provided in the SETS in order to mitigate transportation related impacts, an Environmental Mitigation Fee shall be paid to participate in and pay a proportionate share of the construction cost to fund the South 272nd/South 2770, Street Corridor, which supports an alternative vehicular route that does not require passing through Downtown Kent 10 Planned Action Ordinance— Iient Station SEIS e. Road Improvements The Planned Action would require off-site road improvements as follows Phase I (0 to 690 net new PM peak hour trips) Subject to the Public Work's Director's discretion provided for in subsection 5(c) above, Phase I mitigation will be triggered by the first application and will apply to all developments until the point those developments generate up to a total of 690 net new PM peak hour trips For any of these proposals, all of the traffic improvements listed below must be constructed before the City will issue any Certificates of Occupancy At the discretion of the Public Works Director, the City may accept a fee in lieu of constructing these improvements Any fee shall be for the full cost to the City for the construction of the improvements s • 4`s Avenue NIS 228i" Street. Construct a right-tum lane on eastbound S 228ei Street to southbound 0 Avenue N. Combined with protected phasing for this new nght-turn 4 lane, operations could be improved from LOS F to LOS D during the PM peak how. • Central Avenue S/W Willis Street: Construct a new nght-turn lane on southbound Central Avenue S to westbound W Willis Street The new right-turn lane would operate protected with east and westbound left- turn movements to estabhsh a LOS D. 2°d Avenue S/W Willis Street: This unsignalized intersection is anticipated to operate at LOS F on the j minor approaches of 2"a Avenue S in 2010 with either the Proposed Action or No Acton alternatives. Restrict 11 Planned Action Ordinance— Kent Station SEIS 4 left-turn moveanents from W Wi is Street onto and } Avenue S. Phase II(690 to 1,460 net in ew PM peaty hour trips) Subject to the Public Works Director's discretion provided for rn subsection 5(c) above,Phase II mitigation will be triggered by any development that raises the total trip generation above 690 net new PM peak hour trips. For any of these developments, all of the traffic improvements listed below must be constructed before the City will issue any Certificates of ; Occupancy At the discretion of the Public Works Director, the City may accept a fee in lieu of constructing these improvements Any fee shall be for the full cost to the City for the construction of the improvements. • 4td Avenue S/W Willis Street. Widen to create a second left-turn lane on eastbound W Willis Street to northbound 4a' Avenue S and extend the right-turn lane on southbound 40' Avenue S to westbound W Willis Street. The intersection would operate at LOS D during the PM peak hour with these improvements. • 40 Avenue N/W Harrison Street- Create channelized nght-tum lanes on the eastbound and westbound approaches of Harrison Street Operations would improve for right-turning vehicles, by allowing right- turning vehicles to bypass vehicles that are waiting in the througb/left-turn lane and enter the 0 Avenue N traffic stream more quickly. 12 Planned Actfon Ordinance— Kent Station SEIS These road improvements have been analyzed in the SEIS. Significant changes to the road improvement plan proposed as part of any Planned Action Project that have the potential to significantly increase unpacts to au quality, water quality, fisheries resources, noise levels or other factors beyond the levels analyzed in the SEIS may require additional SEPA review 6 Earth: A significant change from the base of information and significant impacts contained in the SEIS under Prior Planning and Environmental Review and from the soil and groundwater contamination identified under EarthlEnviroiimental Health ui Chapter III of the SEIS that have the potential to adversely affect water quahty, fisheries resources or environmental health concerns shall require additional SEPA review,including possible MTCA compliance T. Air Quality: A siginficant change in site layout or traffic generation from that identified and evaluated in the SEIS that could affect localized air quality would require additional SEPA review. Construction related mitigation measures to reduce air quality impacts, as outhned in the SEIS, shall be incorporated into the construction plans where appropnate. 8 Water. A significant change from the base of information and significant impact analysis contained in the SETS under Prior Planning and Environmental Review, and from the wetlands that were analyzed under Wetlands in Chapter III of the SEIS that have the potential to adversely affect water quality or fisheries resources in a material manner not identified in the SEIS will require additional SEPA review The City will rely on adopted local, state, and federal regulations to i mitigate the significant impacts to water quality and quantity from the Planned Actions 13 Planned Action Ordinance— Kent Station SEIS a 9. Public Services and Utilities A significant change from the base of information and significant impact analysis contained in the SEIS under Prior Planning and Environmental Review, and a significant increase in the number of square feet or dwelling units beyond the maximum number reviewed in the SEIS, which has the potential to result in significant adverse environmental impacts not previously identified in the SEIS in the development's provision of public services and utilities will require additional SEPA review. E Planned Action Review Criteria. 1. The SEPA Official or designee is authorized to designate a project t application as a Planned Action pursuant to RCW 43.21C.031(2)(a), if ' the project application meets all of the following conditions• a The project meets the description of a Planned Action Project as set forth in this Ordinance, and will implement any applicable mitigation measures identified in this Ordinance; and b The project is located within the Planned Action Area or is an off-site improvement directly related to a proposed development on the subject site; and c, The project is consistent with the City of Kent Comprehensive Plan and the Downtown Kent Action Plan; and < d. The project's significant adverse environmental unpacts have been adequately identified in the SEIS; and e The project falls within the Planned Action thresholds established in Section 3(D)of this Ordinance; and f The SEPA Official has determined that the project's significant impacts have been mitigated through the application of the Mitigation Document in Exhibit A, as well as other applicable City, county, state and federal requirements and conditions, 14 Planned Acdton Ordinance— Kent Station SEIS which together constitute sufficient mitigation for the significant environmental impacts associated with the proposed project,and g. The proposed project complies with all applicable local, county, state, and federal regulations, and where appropriate, the proposed project complies with needed variances or modifications or other special permits have been identified; and h. The proposed project is not an essential public facility F Effect of Planned fiction 1 Upon designation by the SEPA Responsible Official that the development proposal within the Planned Action Area qualifies as a Planned Action pursuant to this Ordinance and WAC 197-11-172, the project shall not be subject to a SEPA threshold determination, an environmental impact statement (EIS), or any additional review under SEPA 2. Being designated a Planned Action or Planned Action Project means that a proposed project has been reviewed in accordance with this Ordinance, and found to be consistent with the development parameters and environmental analysis included in the SEIS, including its incorporated and adopted documents 3 Planned Action Projects will not be subject to further procedural renew under SEPA However, these projects will be subject to conditions as outlined in this document and the attached Exhibit A, which are designed to mitigate any environmental impacts resulting from the project proposal. Additionally, projects will be subject to applicable City, state and federal regulatory requirements The Planned Action designation shall not excuse a project from meeting the City's code and ordinance requirements apart from the SEPA process 15 Planned Action Ordinance— Kent Station SEIS 3 G Planned Action Permit Process. The Planning Manager or designee shall review projects and determine whether they meet the criteria as Planned Actions under applicable state, federal, and local laws, regulations, codes and ordinances The review procedure shall consist, at a minimum, of the following, 1 Development applications will meet the requirements of Kent City Code CXCC'� Titles 6, 7, 11, 12, 13, 14 and 15 Applications shall be made on forms provided by the City and shall include a SEPA checklist or revised SEPA checklist or such other environmental review forms provided by the Community Development, Fire, and Public Works t Departments The checklist may be incorporated into the form of an application. 2 The Planning Manager will determine whether the application is complete as provided mKCC Chapter 12 01 3 If the project application is within the Planned Action Area, the application shall be reviewed to determine whether the proposed application is consistent with and meets all of the qualifications specified in Section 3 of this Ordinance. 4. After the City receives and reviews a complete application, the SEPA Official shall determine, utilizing the criteria and procedures contained in WAC 197-11-172,whether the project qualifies as a Planned Action If the project does qualify as a Planned Action, the Planning Manager shall notify the applicant, and the project shall proceed in accordance with the appropriate permit procedure, except that no additional SEPA review,threshold determination,or EIS will be required. 5 Public notice for projects that qualify as Planned Actions shall be tied to the underlying permit and not to SEPA notice requirements If notice is otherwise required for the underlying permit, the notice shall state that 16 PlannedActi'on Ordinance— 'gent Station SEIS the project has qualified as a Planned Action. If notice is not otherwise required for the underlying permit,no special notice is required. 6. if a project is determined not to be a Plaimed Action, the Planning Manager shall notify the applicant and prescribe a SEPA review procedure consistent with the City SEPA procedures and state laws. The notice to the applicant shall describe the elements of the application that result in disqualification as a Planned Action. 7 Projects disqualified as a Planned Action may use or incorporate relevant elements of the environmental review analysis in the SEIS prepared for the Planned Action, as well as other environmental documents to assist in meeting SEPA requirements The SEPA Official may choose to limit the scope of the SEPA review to those issues and environmental impacts not previously addressed in the SEIS. SECTION 4. - Time Period. This Planned Acton Ordinance shall be reviewed no later than December 1, 2010 by the Planning Manager to determine its continuing validity with respect to the environmental conditions of the Planned Action Area and the vicinity and adequacy of Planned Action requirements and mitigation. Based upon this review, this Ordinance may be amended as needed, and another review period may be specified. SECTION 5. - Con ict In the event of a conflict between the Ordinance or any mitigation measures imposed pursuant thereto and any ordinance or regulation of the City, the provisions of this Ordinance shall control EXCEPT that provision of any Uniform Code shall supersede SECTION 6. -Severabditv Should any section, subsection,paragraph, sentence, clause or phrase of this Ordinance or its application be declared unconstitutional or invalid for any reason, such decision shall not affect the validity of 17 Planned Acddon Ordinance— Kent Station SEIS the remaining portions of this Ordinance or its application to any other person or situation. SECTION 7. - Third Party Lzabih . This Ordinance does not create or otherwise establish or designate any particular class or group of persons who will or should be especially protected or benefited by the terms of these regulations. No provision or term used in these regulations is intended to impose any duty whatsoever upon the City or any of its officers, employees, or agents Notwithstanding any language used in this Ordinance,it is not the intent of this Ordinance to create a duty and/or cause of action runiung to any individual or identifiable person,but rather any duty is intended to run only to the general public SECTION 8. - Effective Date This Orduiance shall be effective upon its passage, approval, and five (5) days from and after its passage, approval and publication as provided by law. *YOR ro ATTEST: BRENDA JACOBER, CJYY CLERK OL , Cr 18 Planned Action Ordinance— Kent Station SEIS APPROVED AS TO FORM: - t " r' k TOM BRUBAKER, CITY ATTORNEY PASSED' i6 day of Qu�'.r 2002. APPROVED 46 day of 2002 PUELISRED. Z _day of 42002. b 1 hereby certify that this is a true copy of Ordinance No 0 passed by the City Council of the City of Kent, Washington, and approved by the Mayor of the City of Kent as hereon indicated. Q ze SEAL) BRENDA JACOBE ITY CLERK �AS�A{ Ip . rx 'fir 19 Planned Action Ordinance— Kent Station SEIS Exhibit A DRAFT Mitigation Document DRAFT Kent Station Planned Action INTRODUCTION AND PURPOSE The State Environmental Policy Act (SEPA) requires environmental review for project and non-project proposals that may have significant impacts upon the environment In order to meet SEPA requirements, the SEPA Official for the City of Kent issued a Draft Supplemental Environmental Impact Statement for the Kent Station Planned Action on April 23,2002,and a Final Supplemental Environmental Impact Statement an July 9, 2002 (collectively, the "SEIS'. The SEIS has identified significant impacts that would occur with the future redevelopment of the subject site together with a number of possible measures to mitigate those significant impacts The purpose of this Mitigation Document is to establish specific mitigation measures, based upon significant impacts identified in the SEIS The mitigation measures would apply to future development proposals that are deemed, pursuant to the City's Planned Action Ordinance and WAC 197-11-172, to constitute Planned Actions or Planned Action Projects that are comparable to the Proposed Action reviewed in the SEIS, and that are located on the approximately 25 acre subject site(see Exhibit B) The mitigation measures may also apply to off-site improvements, if they were analyzed in the SEIS Pursuant to RCW 43 21C 240 and WAC 197-11-150, this mitigation is in addition to the mitigation required by other applicable City, county, state and federal regulations and requirements. USE OF TERMS r As several sinular terms are utilized in this Mitigation Document, the following phrases or words are defined briefly SEPA Terms "Action" means projects or programs financed, licensed, regulated, conducted or approved by an Agency "Project actions"involve decisions on a specific project such as a construction or management activity for a defined geographic area "Non project" actions involve decisions about policies,plans or programs. (See WAC 197-11-704) "Planned Action"refers to types of project actions that are designated by ordinance for a specific geographical area and addressed in an EIS, in conjunction with a comprehensive plan or subarea plan, a fully contained community, a master planned resort, a master planned development or phased project (See WAC 197-11-164). Exhibit A—Miagatioa Document Kent Station Planned Action Page 2 "Proposar'means a proposed action, which may be actions and regulatory decisions of an agency,or any actions proposed by applicants. (See 197-11-7&4) Other Terms The subject site or Planned Action Area may be referenced as "Kent Station," "site," "subject sire" or"Planned Action Area"in this document Mitigation measures may also apply to off-site improvements analyzed in the SEIS This document includes mitigation measures that are tied to the approval of site plans, construction plans, civil plans, plats, planned unit developments, and design review Regulations are found in Kent City Code Titles 6,7, 11, 12, 13, 14 and 15. GeneralIntergretation Where a mitigation measure includes the words "shall" or `will" the requirement is mandatory Where"should" or "would" appear the words convey the City's expectation and desires given circumstances presently known, with recognition that pertinent alternate or equivalent requirements may be imposed as more detailed design or reports are conducted consistent with the mitigation measures, Unless stated specifically otherwise, the mitigation measure requirements to prepare plans, conduct studies, construct improvements, conduct maintenance activities, etc, are the responsibility of the future developer(s)to fund and/or carry out DEVELOPMENT PROPOSED UNDER PLANNED ACTION Proposed Action The Proposed Action reviewed in the SEIS includes. • a to redevelop the Planned Action Area within Kent's Approval of plan r p Downtown as a mixed-use urban village • Adoption of an ordinance designating the Kent Station Site as a Planned Action for purposes of SEPA compliance (per RCW 43.21C,031(2)(a), and WAC 197-11-164 and 197-11-168), The City of Kent Downtown Strategic Action Plan identified the Subject Site("Site") as a key redevelopment opportunity and recommended preparing a master plan The Planned Action designation reflects a decision that adequate environmental review has been completed and that further environmental review, under SEPA, for each specific development phase would not be necessary if it is detenrimed that any given Planned Action Project is consistent with the development levels specified in the Planned Action ' Ordinance and evaluated in the SEIS and/or applicable development regulations Exlubit A—Mitigation Document Kent Station Planned Action Page 3 The Planned Action mcludes a combination of retail, commercial, educational/rnstitutionai, residential and mixed-use redevelopment projects through the year 2010 It also includes the City's approval of Planned Unit Development (PUD)/master plan, administrative design review, wetland mitigation plan, subdivision, civil construction drawings, and building permits. A program of road, infrastructure, and streetscape improvements are integral to the redevelopment proposal. The City and the Kent Station developer may also execute a development agreement, pursuant to RCW 36 7013.170. The agreement would set forth the development standards, mitigation requirements,review procedures,etc applicable to future development. The SEIS provides conceptual information on the potential mix of uses,building density and height, access/circulation, recreation and open space opportunities and other development features. The intensity of site development would fall within the range of development represented in Alternative 2 of the SEIS (Reference Chapter 11 of the Draft SEIS). The proposed development thresholds consist of 518,400 square feet of commercial, 169,400 square feet(200 rooms)of hotel/conference center, and 490 units of housing (434,000 square feet) Also included are 2932 parking stalls and 53,000 square feet of park/open space. AmnlicabdO of Mitigation Document This untrgation document applies to the Proposed Action, Alternative 2 analyzed in the SETS. For the mitigation document to apply to future development proposed in the Planned Action Area, that proposed development must be comparable to or within the range established by Alternative 2, as shown below Sent Station Alternative 2 -Summary ofDevelopment LAND USE Alternative 2-Kent Station Proposal Commercial(square feet) 518,400 sf Retail 191,800 Restaurant 35,900 Grocery 47,700 Cinema(12-Screen, 2,800 seats) 55,000 Office 139,000 Community College 50,000 Hotel/Conference Center 169,400 sf Hotel Rooms 200 rooms Subtotal Multi-family Residential(square feet) 434,000 sf Housing Units 480 units Total Commercial/Residential Development 1,121,800 sf Park!Open Space 53,000 sf Civic Plaza(Alt 2)/Plaza Area(Alt 3) 23,000 Park Block(Alt 2)/Town Square(Alt 3) 30,000 Borden Playfields 0 Parking(stalls) 2,932 staffs Exhibit A—Phtigation Document Kent Station Planned Action Page 4 Building heights range from one to six stones (Reference Chapter 11, Tables 4 and 5 in the SEIS). All of the alternatives would provide the same public street improvements to 1$, 2"d and 4'h Avenues N Two new public streets would also traverse the site- 1) Temperance Street between 1" and 2"d Avenues N., and 2) 2"d Avenue N would be extended from Smith Street to 0 Avenue N (Reference Chapter 1I-14—II-16 of the SEIS. If future proposed plans exceed the maximum development parameters reviewed, supplemental environmental review may be required pursuant to WAC 197-11-172 and other applicable SEPA Rules MITIGATION DOCUMENT Based upon the SEIS, which is incorporated by this reference, this Mitgaton Document identifies significant adverse environmental impacts that are anticipated to occur in conjunction with the development of the Proposed Action Mitigation measures are hereby established under SEPA Rules to address specific impacts identified in the SEIS, based upon the Proposed Action. Additions] consistency review under the Planned Acton, site plan review, and other permit approvals will be required for specific development actions under the Proposed Action pursuant to WAC 197-11-172. Additional project conditions may be imposed on what are deemed to be Planned Action Projects based upon the analysis of the proposal in relationship to independent requirements of city, state or federal requirements or review cntena. Any applicant for a project within the Planned Action Area may request modifications to these mitigation measures, if appropriate and as a result of changed circumstances, in order to allow an equivalent substitute mitigation or removal of a mitigation requirement Such modifications would be evaluated by the City SEPA Responsible Official prior to any approvals by the City,based upon SEPA Rules As permitted under SEPA Rules (WAC 197-11-660), it is recognized that there may be some adverse impacts that are unavoidable because reasonable or feasible mitgaton cannot be achieved for the Proposed Action Provided below for each element of the environment analyzed in the SEIS for the Proposed Action are (a) summary of and/or reference to SEIS analysis of significant environmental impacts (direct, indirect and cumulative); (b) summary of significant unavoidable adverse impacts, (c) mitigation measures established by this Mitigation Document, and(d) a list of federal and state laws and local palieiestregulatons on which mitigation measures are based f Exhibit A—Mitigation Document Kent Station Planned Action Page 5 In combination,regulations applicable to each element of the environment and mitigation measures imposed by this document will apply to and govern any Planned Action Project and will adequately mitigate all significant environmental impacts caused by the Proposed Action, except for those impacts that are identified as "significant unavoidable ' adverse impacts" I. Earth/Environmental Health A. Significant I=acts Chapter III of the SEIS addresses remediation of on-stte soil and groundwater contammation Other potential environmental impacts to earth resources and environmental health (i e., noise) have been adequately addressed in previous environmental documents and are summarized in Chapter II of the SETS. A summary of impacts is provided below based upon the SEIS Summary Matrix. • Exposure to contaminated soils and groundwater on the site could pose potential health risks to the public Health risks are the basis of the applicable cleanup levels that are being implemented through a cleanup plan B Significant Unavoidable Adverse Impacts Provided that reasonable mitigation measures are properly followed, no significant unavoidable impacts are anticipated C. Mitigation Measures The mitigation measures established below address impacts identified in Chapter III of the SEIS. • No mitigation measures beyond those already identified and being implemented in connection with cleanup of the Borden Chemical Facility, BNSF, Reiman Trust, Brutsche, Silvestri and adjacent sites are required. Cleanup activities would be coordmated with redevelopment of the site and associated construction activities • Any required Clean up actions will occur as part of, and concurrent with, site preparation and construction activities for the 2nd Avenue extension and other proposed on-site development Consistent with the recommended monitoring program,any monitoring wells displaced by redevelopment shall be relocated. • Monitoring shall occur as recommended in the Phase lI site assessment reports • Earthwork should be accomplished during the dry season from May to September whenever possible, when soils are likely to be compacted and when erosion and sedimentation activity are at a seasonal low. • Erosion control methods in the short tern can include channeling surface water runoff, erosion preventing slope cover (e.g straw), channel lmers, and sedimentation control ponds Long term methods include nummizmg the concentration of runoff onto fill, cut or natural slopes, and minimizing disturbances to natural drainage courses and existing vegetation Exhjbit A—Mitigation Document Kent Station Planned Action Page 6 2. Air Quality A. Significant Impacts Chapter II of the SEIS includes an examination of significant impacts to air quality in terms of construction activities, generated traffic, and indirect air emissions. In general, reduced emissions of particulates, carbon monoxide and nitrogen oxides would be associated with concentrating growth in a mixed-use pattern at higher densities in pedestnan-onented areas. Localized dust and exhaust emissions would be generated from construction activities. An Air Quality Conformity Analysis was conducted in conjunction with the FSE1S. No significant impacts were identified and no mitigation measures related to conformity are required B, Significant Unavoidable Adverse Impacts: Provided that reasonable mitigation ' measures are properly followed, no significant unavoidable impacts are anticipated. C Mitigation Measures- The following construction related mitigation measures to reduce au quality impacts shall be incorporated into the construction plans where appropriate • Use only equipment and trucks that are maintained in optimal operational condition • Require all off road equipment to be retrofitted with emission reduction equipment(i e ,require participation in Puget Sound region Diesel Solutions by project sponsors and contractors) • Use bio diesel or other lower-emission fuels for vehicles and equipment t • Use carpooling or other trip reduction strategies for construction workers • Stage construction to minimize overall transportation system congestion and delays to reduce regional emissions of pollutants during construction • Implement construction curbs on hot days when region is at risk for exceeding the ozone NAAQS, and work at night instead ; • Implement restrictions on construction truck idling(e.g., limit idling to a maxunum of 5 minutes) • Locate construction equipment away from sensitive receptors such as fresh air intakes to buildings, air conditioners, and sensitive populations • Locate construction staging zones where diesel ermssions won't be noticeable to the public or near sensitive populations such as the elderly and the young • Spray exposed soil witb water or other suppressant to reduce emissions of PM10 and deposition of particulate matter • Pave or use gravel on staging areas and roads that would be exposed for long penods • Cover all trucks transporting materials,wetting materials in trucks, or providing adequate freeboard(space from the top of the material to the top of the truck bed), to reduce PM10 emissions and deposition during transport i I J Exlnbit A—Mitigation Document Kart Station Planned Action Page 7 • Provide wheel washers to remove particulate matter that would otherwise be earned off-site by vehicles to decrease deposition of particulate matter on area roadways • Remove particulate matter deposited on paved,public toads, sidewalks, and bicycle and pedestrian paths to reduce mud and dust; sweep and wash streets continuously to reduce emissions • Cover dirt,gravel, and debris piles as needed to reduce dust and wind-blown debris • Route and schedule construction trucks to reduce delays to traffic during peak travel tunes to reduce air quality impacts caused by a reduction in traffic speeds 3. Noise A. Significant Impacts. Increased noise and vibration would be associated with construction These impacts could be intensive in some locations for limited penods of time Some construction equipment and methods (e g., pile driving) can produce peak noise levels greater than 100dBA, as well as significant vibration B Significant Unavoidable Adverse Impacts Provided that reasonable mitigation measures are properly followed, no significant unavoidable impacts are anticipated. C Mitigation Measures Mitigation measures for construction impacts may include enforcement of limits of the hours of construction activity,proper maintenance of equipment, use of mufflers and/or temporary sound barriers, alternative construction techniques (e g, pile auguring), contractor preparation of noise control plans, and active monitoring and enforcement of applicable standards. / 4. Wetlands A. Significant Impacts Chapter III of the SETS includes an exammi Lion of significant impacts to wetlands. A summary of impacts is provided below based upon the SEIS Summary Matrix. For a more detailed discussion of impacts, see Chapter III of the SETS. • Three on-site wetlands would be filled to permit construction of planned buildings,roads and infrastructure B Siffiificant Unavoidable Adverse Impacts The wetland fiuietions, values and area would be lost and are unavoidable m the context of the alternative site plans > and the City's goals for Downtown development. r Exhibit A—Mitigation Document Kent Station Planned Action Page 8 C Miliggion Measures. • Mitigation, in the form of off-site compensation, would occur consistent with the City's adopted wetland standards and regulations and shall include :he preparation of a wetland mitigation plan. 5. Land Use A- Sienificant Impacts Chapter III of the SETS includes an examination of significant impacts to land use A summary of impacts is provided below based upon the SEIS Summary Matrix For a more detailed discussion of impacts, see Chapter III of the SETS • Proposed development would be of higher density and intensity than the No Action alternative and therefore involve potentially greater impacts However, proposed development would be comparable to the density and intensity permitted under current zoning • A mix of uses would occur. • The character of the site would change significantly from low-density, auto- oriented, suburban area with small buildings surrounded by large parking lots, to an urbanized,pedestnan-onented/transit-onented district. • Borden Playfields would be replaced by urban park space resulting in a net reduction of between 3 5 and 3 8 acres of park land in the City Demand could increase at other park facilities • Increased fight, noise, and activity associated with an urban area may be noticeable from residential area to the north • Proposal would encourage new economic, civic and pedestrian activity in the area that indirectly could result in increased development pressure on surrounding properties to intensify. • Some existing uses may be displaced and could relocate within the site or nearby commercial districts. As redevelopment occurs, potential land use conflicts between adjacent low intensity uses and new development could result B. Sigmficant Unavoidable Adverse Impacts- Some displacement of existing land uses on the Kent Station Planned Action site would occur Some limited contrast m land use intensity,bulk and scale would occur,primarily where larger buildings are proposed adjacent to existing single family residences. Impacts relating to lighting and noise may be mitigated but cannot be entirely avoided, they are considered to be an inherent characteristic of a mixed-use urban neighborhood C Mitigation Measures Kent's adopted Comprehensive Plan, zoning regulations and Downtown Design Guidelines provide policies, processes, standards and development regulations that would mitigate most identified impacts • Utilize careful site planning,building design and buffering Utilize techniques such as lighting limits, full cut-off fixtures, ample landscaping to buffer Exlnbii A—Mthgauon Document Kent STation Planned Action Page 9 adjacent uses and ensure privacy, placement/onentabon of some building elements(e a.,dehveries, solid waste receptacles) to help control noise. • Locate taller buildings in the interior of the site, set back upper stories of taller buildings from the street, or utilize additional screening or other design techniques to reduce the impact to existing single family neighborhoods. • To mmunmze potential business and employment displacement impacts that would occur on-site,the City should provide technical assistance in relocation to other suitable sites. • In mixed-use areas, the potential intrusion of noise from commercial, office and retail areas into residential areas should be minimized by limiting noisy activities (e.g. trash collection or composting) to hours outside of 11 pm to 7 am 6. Relationship to Plans,Policies and Regulations A Significant hnpacts. Chapter IN of the SEIS reviews the consistency of the Kent Station Planned Action alternatives to selected federal, state, regional and local plans,policies and/or regulations. • The proposal is consistent with GMA planning goals to guide growth into an area with existing and planned infrastructure. The proposal also is consistent with the City of Kent's land use designations, transportation, economic development, and community design policies and goal of redeveloping Downtown from a low-intensity suburban character to a higher intensity urban character. B Significant Unavoidable Adverse Impacts None are anticipated C Mitigation Measures No specific mitigation measures are warranted beyond the application of City regulations, which in many cases contain mitigation features Future development or redevelopment within the Downtown is subject to existing federal and regional storm water management plan requirements, local development regulations,local concurrency regulations, and design standards. 7. Aesthetics A Significant Impacts Chapter III of the SEIS includes examination of significant impacts to visual character, including intensity, bulk/scale/height, visual compatibility, streetscape continuity, and light and glare generated. A summary of impacts is provided below based upon the SE1S Summary Matrix. • The proposal is likely to improve visual quality overall. Proposed development would support the Historic District by unprovmg streetscapes, pedestrian connections, and urban parks, resulting in a more unified Downtown core area • The proposal would provide mixed-use development in buildings ranging from one to six stones in height and lot coverage of up to 95 percent Most buildings would contain ground floor retail uses to encourage a lively EXHIBIT G Development Milestone Schedule '_Matter Date Application for Demolition and Street Use Permits On or before October 14, 2011 Issuance of Demolition and Street Use Permits On or before November 1. 2011 Commence demolition of Existing Improvements On or before November 1,2011 Complete demolition of Existing Improvements Ninety (90) days thereafter (Subject to extension for Force Majeure) (February 1, 2012) Submit complete applications for Downtown Design Review On or before October 1, 2012 pursuant to KCC 15 09 046 (including submission of Schematic Design Documents and environmental checklist) Submit complete application for combined Civil Construction Later of May 1, 2013 or Ninety Permit and Building Permit (90)days after City approval of Downtown Design Review Issuance of combined Civil Construction Permit and Building October 1,2013 Permit Note: Permit applications and/or PAO may include submission of an environmental checklist or additional information or documents such as parking study or transportation management plan as required under the KCC or PAO. This exhibit does not set forth all ancillary permits or approvals that may be required to construct or operate the Project(such as sign permit or lot line elimination certificate). E G-1 PV0399_DRSM399_31R D913D/tit EXHIBIT H T Conceptual Plans for the Project [to be attached as an exhibit following approval by the City] E a H-1 P V0399_DRS120399_31R 09 3011 m a h O N N 0 (' o a N L� wry U) — _ _ _ � Z WzLLI WINE LLI Ilk_ LU W ,� .'a Oar-ZwzA { � i � „��••� LLI Q ` 00 tFOL Li N S LL. N _ 06 ��4i Sil __ y c �y rad ■■ �IYS Fw,� •" C ■r No ■1 ■ on ■■ or ■ "a WR011 am a �• _ �• \ ■ a r � �I Y�NM .1t�) ■■ k LWL _ _ i at 0 as U ■id 11 ■si lip, ■ adi r,�/ ■ ■ r ■Im r m 11 ■_ �n � c �J CIC3 0 146P . A Q m Q N 0 0 a N a�vz Z " LU CAN oo �t CO r U � LLJ N F zF- �N �W d a V Q N a U c) 3A � z z0N W o I N vi s 0 p) N W K ICA 3 0 s' r t7 3s NZA 2 ' E U ' cp m� a n 1 L 0 W c0 c,j CO 6MP 11->Z-5 ...[d taoz/vZ/90 0= 0 I B�daa Q � m (S p wW z � O N -T W Q � Q J z woo Y " W W z JTF 0 N V F } � Q % s z j Y i I a M I F z II v Q� d J LU Q F CU 6Mp LL—YZ-9-u-Id UOZ/YZ/90 0= ® ;45,0 a 's ,f • I �I • • 1 • IA��11�� �f. E _ �5 a. .. i '+���] ,- . !!•�.1.�'•.•.••�•�•�•� •fir .1 u • .11 a jlyC •�• ♦ • •ON eWHOM wrdn iii i mz Giulio- `y l... . aT ��♦� n5y 5.' 3f;h �; _.was+ ... _'..._.'u•' q •i . + s4y;�V k't`(. 1 � ■��+r�SM'1 �I �`,,::� iin Yam'. WE Mill 1 - Now— ry i [y . -- �} �Y["'V'W 1 sue• MGM ri YJ ' fi•.,*icy��� 0 4A w _11:'�_"1 tia 1 1 to W1 _F �� t I _r Y R r U' r-r f u.1 L { 1 r -- r a EXHIBIT I After Recording Return To: Goodman Real Estate. Inc. 2801 Alaska Way, Suite 310 Seattle, Washington 98121 Atm President BARGAIN AND SALE DEED GRANTOR. CITY OF KENT, a Washington municipal corporation GRANTEE: GOODMAN REAL ESTATE; INC.,a Washington corporation Legal Description Abbreviated Form: Additional legal on Exhibit A to document Assessor's Tax Parcel ID#: THE GRANTOR, CITY OF KENT, a Washington municipal corporation for and in consideration of Ten Dollars ($10 00) in hand paid, Grantees agreement to Commence Construction and achieve Final Completion of the Project as hereinafter set forth and other good and valuable consideration,the receipt and sufficiency of which is hereby acknowledged, bargains, sells and conveys to GOODMAN REAL ESTATE, INC., a Washington corporation ("Grantee") certain real property situated in the County of King, State of Washington more particularly described in Exhibit A attached hereto and incorporated herein by this reference (the -Pro Re ") subject to and excepting those matters listed on Exhibit B attached hereto and Incorporated herein by this reference(the "Permitted Exceptions"). The Grantor for itself and for its successors in interest does by these presents expressly limit the covenants of this deed to those herein expressed. and excludes all covenants arising or to arise by statutory or other implication, and does hereby covenant against all encumbrances done or suffered by Grantor from and after October 1, 2010,and not otherwise Dated ,20 CITY OF KENT,a Washington municipal corporation APPROVED AS TO FORM: By By: Name: Name: Title. Title- 1-1 P 120399 0R&20399 31R 09ml I r 3 a ACCEPTED AND AGREED this day of 120 GOODMAN REAL ESTATE, INC, a Washington corporation By- Name: Its STATE OF WASHINGTON ) ss. COUNTY OF KING ) 1 certify that I know or have satisfactory evidence that is the person who appeared before me. and said pet son acknowledged that he/she signed this instrument, on oath stated that he/she was authorized to execute the instrument and acknowledged it as the of the City of Kent, a Washington municipal corporation 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 (Use this space for notarial stamp/seal) I-2 Pt20399_DRSi20399_31R WWI STATE OF WASHINGTON ) ss. COUNTY OF ) I certify that I know or have satisfactory evidence that is the person who appeared before me,and said person acknowledged that he/she signed this instrument, on oath stated that he/she was authorized to execute the instrument and acknowledged it as the of Goodman Real Estate, Inc , a Washington corporation, to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument Dated: Notary Public Pnnt Name My commission expires (Use this space for notarial stamp/seal) 1-3 P U0399_DR5\20399_31R 0930111 i Exhibit A (Legal Description) I-A-1 P=399 DRM20399 31R 09/30/11 Exhibit B Permitted Exceptions I-B-1 P 120399 DRS120399 31R 09/30111 EXBiIBIT J Temporary Construction Easement Agreement .T-1 P V0399_DRS\20399_31R D913CVII ' Iz . . v AFTER RECORDING RETURN TO: Foster Pepper PLLC Third AAvenue, Suite 3400 Seattle, Atm: Beth A. Clark 20111024000433 PACIFIC NY TIT EAS 71.00 PAGE-001 'IF 011 10/24/2011 KING COUNTY, UA TEMPORARY CONSTRUCTION EASEMENT AGREEMENT Grantor: City of Kent,a Washington municipal corporation Grantee: Goodman Real Estate,Inc.,a Washington corporation Legal Description/ Grantor's Property: Lot C, City of Kent Lot Line Adjustment No.LL- 200S-37,Recorded January 10,2006 under Recording No.20060110002592,in King County, Washington Legal Description/ Developer's Property: Lots A and B,City of Kent Lot Line Adjustment No.LL-2005-37,Recorded January 10,2006 under Recording No.20060110002592,in King County,Washington Assessor's Tax Parcel ID#s: 982570-0520; 982570-0515; 982570-0505 This TEMPORARY CONSTRUCTION EASEMENT AGREEMENT (herein this"Easement A&reernent") is made and entered by and between City of Kent(herein the "Grantor"), and Goodman Real Estate, Inc., a Washington corporation (herein the " vel r"). Sold documents were filed of record as an accommodation orUy It has not been exam:nad as to RECITALS proper execution or as to its effect upon UUe. A. The Grantor is the owner in fee of the real property legally described above • as the"Qra]tor's Property" FIR.ff AMEMICM I EXCISE TAX NOT REQUIR& I ' Co.Re00rds j BY Y Y t ...... .. . .. , r , ... ... ......... B. The Developer is the lessee of that certain real property legally described above as the "Developer's Pro ep�i y' pursuant to that certain Lease (with Option to Purchase) between Grantor and Developer dated as of September 30, 2011 (the "Lease'. i The Developer's Property is the Leased Premises demised under the Lease and is located I immediately adjacent to the Grantor's Property. C. The Developer intends, at 'its expense, to demolish certain existing improvements on the Developer's Property (the "Existing vetnents") in accordance with the requirements set forth in the Lease as part of overall development of the Option Property as a nixed use project including residential apartments, retail space and associated parking (the "Project") in the event that the Option to purchase the Option Property as defined in the Leese is exercised by Developer in accordance with the terms, covenants and conditions set forth in the Lease. D. In connection with the Developer's demolition and removal of the Existing Improvements and performance of such pre-development Project activities as are authorized under the Lease (herein the "Work'), the Developer desires to obtain, and Grantor has agreed to grant, a non-exclusive, temporary constriction easement over and across Grantor's Property in the location depicted in the site plan attached hereto as Exhibit ® (herein the"Easement Area") for the purpose of facilitating Developer's 's completion of the Work. The Grantor is willing to grant said easement to the Developer on the terms, conditions and provisions set forth below. E. All capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Lease. NOW, THEREFORE, in consideration of the Developer's performance of the Work in accordance with the requirements set forth in the Lease and other good and valuable consideration,the receipt and sufficiency of which are hereby acknowledged,the parties,intending to be legally bound,agree as follows: 1. Recitals. The foregoing recitals are true and correct and are hereby fully incorporated herein by this reference. 2. Grant of Easement. The Grantor hereby grants and conveys to the Developer for the benefit of the Developer's Property and the completion of the Work, a nonexclusive,temporary easement (herein the"Easement") in the Easement Area for the purposes of demolition and removal of the Existing improvements, including temporary construction staging during the performance of the Work and all necessary access to Grantor's Property for such purpose and to the extent necessary for completion of the Work subject to the limitations set forth in the Lease. t I i 2 i 3. Duration of the Easement The benefits and burdens of this Easement Agreement are appurtenant to and shall run with and benefit the Developer's Property and shall run with and burden the Grantor's Property. The Easement is temporary in nature, personal to Developer and shall be enjoyed by the Developer and the Developer Parties solely during the Term of the Lease and shall automatically terminate without any further action required by either party upon expiration or earlier termination of the Lease. If requested by Grantor, Developer shall execute a termination of this Easement Agreement in recordable form within two (2) business Days following the expiration or earlier termination of the Lease, but in any event no later than the Closing of the purchase of the Option Property under the Lease 4, Work Standards: Restoration of Grantor's Prop=. The Developer covenants that all work to be performed and rights exercised under the Easement by the Developer shall be completed in a careful and workmanlike manner. The Developer shall at all times abide by the requirements of all statutes, orders, rules, regulations and other laws applicable to the Work Developer shall pay all laborers,mechanics, subcontractors, material men and all persons who shall supply such person or persons and the Grantee with labor, materials, equipment or services for the carrying on of the Work pemtitted by this Easement Agreement. Developer shall not allow any claims or liens to attach to or encumber the Grantor's Property as a result of the performance of the Work or any activities of Developer or any of the Developer Parties and the Developer shall protect, defend, indemnify and hold the Grantor and the Grantor's Property harmless from and against any such claims or liens. Upon completion of the Work, the Developer shall remove all debris and restore the surface of the Grantor's Property impacted by the Work as nearly as possible to the condition existing as of the commencement of the Work. The Developer's restoration and repair obligations under this paragraph shall not apply to any defects, deficiencies or damage to Grantor's Property which preexisted the entry by the Developer onto the Grantor's Property pursuant to this Easement and shall survive the expiration or earlier termination of this Easement Agreement. I 5. Title. The rights granted herein are subject to permits,leases, licenses and easements, if any, heretofore granted by the Grantor affecting the Grantor's Property. Grantor represents that it has authority to grant the Easement and the rights set forth in this Easement Agreement but makes no representation or warranty of any kind as to the present condition or state of repair of the Grantor's Property which is made available to Developer on an"AS IS"basis b. Indemnity. The Developer shall indemnify, defend, and hold the Grantor harmless from and against any and all claims, losses, liabilities, damages, and expenses (including attorneys fees and litigations costs) resulting or arising from entry upon the Grantor's Property or the use of the Easement or any other portion of the Grantor's 3 f Property by the Developer or any of the Developer Parties which may be incurred by or asserted against the Grantor arising out of the performance of the Work or any other activities by Developer or any of the Developer Parties authorized under this Easement Agreement. The Developer's defense and indemnity obligations under this paragraph shall survive expiration or earlier termination of this Easement Agreement. 7, MispellLneou . 7.1 Assigner The Easement and other rights and benefits granted pursuant to the terms of this Easement Agreement are personal to Developer and are not assignable by Developer. T2 Ca ti The captions and paragraphs headings contained in this Easement Agreement are for convenience and reference only and in no way define, describe, extend or limit the scope or intent of this Easement Agreement, nor the intent of any provision hereof. 7.3 Attorneys' Fees. Except as otherwise expressly provided herein, each party shall 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 Easement Agreement. 7.4 Seyrabil If any clause, sentence,or other portion of the terms, conditions, covenants, and restrictions of this Easement Agreement becomes illegal, null, or void for any reason, or is held by any court of competent jurisdiction to be so, the remaining portions will remain in full force and effect. i 7.5 Notices. All notices, requests, demands and other communications of any type given or required under this Easement Agreement shall be in writing and shall be, either (i)personally delivered to the person to whom the notice is directed by personal delivery with a receipt requested therefore;or (ir)sent by a recognized overnight or"next- day" service for the next day delivery; or (iii) sent by United Stated mail, certified mail, return receipt requested,postage prepaid and addressed as provided below. If to the Grantor, City of Kent 1 220 Fourth Avenue South i ]Cent,WA 98032 Attn: City Attorney If to the Developer: Goodman Real Estate,Inc. 2801 Alaskan Way, Suite 310 Seattle,WA 98121 Attn: Brad Reisinger 4 The person and address to which the notices are to be given may be changed at any time by any party upon written notice to the other parties. All notices ( given pursuant to this Easement Agreement shall be deemed given upon receipt. For the purpose of this Easement Agreement,the term "receipt" shall mean the earlier of any of the following: (i) Any notice by personal delivery shall be deemed effective and received in the date of actual receipt of the notice or other document by the person or entity specified pursuant to this paragraph; and(ii)Any notice given by certified U.S. mail will be deemed effective and received on the third (Yd) business day after deposit in the U.S. mail, in the manner required herein; and (iii) Any notice by a courier delivery service providing overnight or "next-day" delivery,will be deemed effective and 1 received an the next business day after the deposit with such service, addressed as provided herein. 7.6 Enfb cement In the event of a breach of any of the covenants or agreements set forth in this Easement Agreement,the parties shall be entitled to any and all remedies available at law or in equity,including.but not limited to, the equitable remedies of specific performance or mandatory or prohibitory injunction issued by an arbitrator or by a court of appropriate jurisdiction. 7.7 Amendments. It is hereby mutually agreed and understood that any addition, variation, or modification to this Easement Agreement shall be void and ineffective carless in writing and signed by the parties hereto or their successors in interest 7.8 Applicable Law. This Easement Agreement and the performance thereof shall be governed, interpreted, construed, and regulated by the laws of the state of Washington. 7-9 Authori _ Each person signing this Easement Agreement warrants that he has full power and authority to bind the party with respect to which be or she is a signatory. 7.10 Counterpart This Easement Agreement maybe executed in one or more counterparts, each of which shall be deemed an original. All such counterparts together shall constitute one and the same document. Ile signature and acknowledgement pages from each of the counterparts may be assembled together to form a single instrument comprised of all pages of this Easement Agreement and a complete set of all signature and acknowledgement pages. The date upon which the last of all of the parties have executed a counterpart of this Easement Agreement shall be deemed the date of this Easement Agreement and the date of mutual execution hereof. I S M1 .......... ., •1 ' l 7.11 Cnwdor,s Reserved Rights. Nothing in this Easement Agreement shall be interpreted or applied to reduce or otherwise impair any rights reserved to the j Grantor under Section 2 E of the Lease, and the Easement granted herein is expressly granted subject to such reserved rights. I r (signatures follow) I 1 6 f IN WITNESS WHEREOF, this Easement Agreement is executed by the parties, intending to be legally bound, as or the date of mutual execution hereof. GRANTOR: THE CITY OF KENT,a Washington m i corporation By: Its: t '• Approved as to form: By: _� ftlP,(A l its: 1bw Pwu1 0-ri K-ffaujwy DEVELOPER GOODMA�I REAL ES INC.,a tl Washington o By: Its: t i i i .. ......... 3 ' I STATE OF WASHINGTON SS. COUNTY OF I�J i I certify that I know or have satisfactory evidence that is the person who appeared before me, and said person acknowledged that 'd person signed this instrument, on oath stated that said person was authorized to execute the instrument and acknowledged it as the MQu(r 40 TV,-r-% of THE CITY OF ]CENT,a municipal corporation, to be the free and voluntary act of such municipal corporation for the uses and purposes mentioned 1 in the instrument. Dated this .30 ' day of 5epu �_ 2011. dr � ����tHt�nttttt `�` Y A (S®aosaotNwcy) � ��������i +�iYY1��ed ft• 1���� I. 6jVUyP=a Bump&me*Mauq) i Notary public in and for the,,titate 0 i y�08�s `,�O_ Washington,residing at KE'Yl pF''N ..Nt�O,? My appointment expires 6'8-10 t�} ltttii'WAS`',,: I I 1 I g I� Y STATE OF WASHINGTON ss. I COUNTY OF cerbf that 1 know or have satisfactory evidence that i 2 is the person who appeared before me, and said person acknowlbdgeV that said person signed this instrument, on oath stated that said person was aKhonzed tg execute the instrument and acknowledged it as the t'fe5ide.,t'I C EA of GOODMAN REAL ESTATE, INC, a corporation, to be I the free and voluntary act of such corporation for the uses and purposes mentioned in the instrument. l Dated this 3 day of Q ~ � 2011. 1� tip.,��ssion'FxQ F '•� ts�vort�r) I-V tkOI '' 1 erf �Pa1 7 Qi �. PUBLIC z (i<r>ar Pnm or sumo r7eeu orfletvr) j '' di • a 'o= Notary public in and for the to Washington,residing at IflOFtlW00o My appointment expires o2123//v 1 ' K+�owaun000s�ma_su.uaw�[�+tCBp�.ex � , I 1 9 EXHIBIT A Site Plan Depicting Easement Area I EXMBPT A I EXHIBIT K Contingent Payment Agreement K-1 PV0399 DRS=399_31R 02/30/11 KENT CITY CENTER CONTINGENT PAYMENT AGREEMENT This Contingent Payment Agreement (the "Agreement") is made this _ day of 2011 ("Effective Date") by and between ("Developer") and the City of Kent, a Washington municipal corporation("City"). a RECITALS j A. Simultaneously herewith, Developer has purchased from City certain real property and improvements owned by City and legally described in Exhibit A attached hereto (the"Property") in Kent, Washington. B. In order to address variables in current market conditions and the related uncertainties as to the market value of the Option Property and Developer's intended redevelopment of the Property with the Project (the Option Property as improved with the Project is hereinafter referred to as the "Property"), Developer and City have agreed that in addition to the Base Option Price paid at closing for the Option Property, Developer shall pay certain contingent amounts to City periodically based upon the City's Pro Rata Share of Amounts Realized (as defined below) by Developer with respect to Developer's intended development of the Option Property with the Project as further described below. C. All capitalized terms used herein and not otherwise defined shall have the meaning as set forth in the Lease (with Option to Purchase)between Developer and City dated as of , 2011 (the"Option/Lease Agreement"). NOW, THEREFORE, in consideration of the covenants, terms and conditions set forth herein,the parties agree as follows: 1. Contingent Pam, 1.1 General. For and in partial consideration for the sale of the Option Property to Developer, Developer agrees to pay to City to the extent and on the terms and conditions set forth herein, an amount equal to [fill in final amount of Contingent Payment which shall be the Demolition Costs as defined in the Lease], as adjusted in accordance with Section 1 1(f) below (the "Contingent Payment"). The Contingent Payment shall be payable if and to the extent the following occurs: a. To the extent from time to time or at any time there are Amounts Realized by Developer, then a pro-rata portion of any such Amounts Realized shall be paid to City as described below ("City's Pro-Rata Share") until the Contingent Payment is paid in full, subject to Section 1.1c. below. b. The City shall be paid City's Pro-Rata Share of Amount Realized on the earlier of(a) thirty (30) days following Developer's receipt of the Amount Realized, or(b) the date Developer credits Amounts Realized to its member's capital accounts or distributes Amounts Realized to its members. C. If the Contingent Payment has not been paid in full during the Term of this Agreement, then any outstanding, unpaid balance of the Contingent Payment shall i not be due or payable to City by Developer or any successor in interest thereto, it being the agreement of the parties that the Contingent Payment is payable solely and to the extent of City's Pro-Rata Share of any Amounts Realized by Developer. d. Notwithstanding anything to the contrary contained herein, Developer, in its sole discretion, may elect to pay in full at any time the then-outstanding balance of the Contingent Payment e. Notwithstanding anything to the contrary contained herein, the then outstanding balance of the Contingent Payment shall become immediately due and payable if there is a transfer of a Controlling Interest in Developer prior to Final Completion of the Project and Stabilized Occupancy of the Project each as defined in the Lease. f. The total amount of the Contingent Payment payable to City hereunder shall increase annually, commencing upon the one year anniversary of the City's i issuance of a final certificate of occupancy for the Project, and shall increase annually thereafter by an amount equal to [5 7% of the Demolition Costs]. 1.2 Defined Terms. For purposes hereof: a. "Amount Realized" shall mean with respect to any fiscal period the aggregate of all amounts actually distributed by the Developer to its members with respect to their membership interests in Developer, whether such amounts are distributed in return of capital, as a liquidating distribution upon any liquidation or dissolution of Developer, as preferred returns, as distributions of operating cash, or as distributions from a Capital Event, i insurance recovery proceeds, condemnation proceeds and other proceeds from whatever source with respect to the Property. Developer intends and hereby agrees to make distributions to its members in the ordinary course of business subject to such capital replacement and operating reserves as Developer deems reasonably prudent in connection with operation and maintenance of the Property and to pay City its Pro Rata Share of Amounts Realized on a parr passu basis with distributions made by Developer to its members. To the extent distributions by the Developer to its members is in a form other than cash, the fair market value of any non-cash distributions shall be included in the determination of the Amount Realized. i b. "Capital Event" shall mean(i)the sale, exchange, condemnation or casualty loss (subject to the limitation noted in (u) below) or other disposition (whether voluntary or involuntary) of all or any part of the Property or any interest therein, excluding dispositions of personal property and equipment in the ordinary course of business, (ii) the recovery of condemnation or damage awards or insurance proceeds (other than business or rental interruption insurance proceeds) where funds are not used for restoration purposes and not paid to any Property lender (iii) prior to Final Completion and Stabilized Occupancy of the Project as -2- P=399 DRS'20399_31T 0913D171 defined in the Lease, any transfer of a controlling interest in Developer to another entity, and/or (iv) all net proceeds from a refinancing of the Construction Loan C. "City's Pro-Rata Share" shall mean a fraction, the numerator of which is the amount of the Contingent Payment and the denominator of which is the sum of. (1) the amount of the Contingent Payment; and (u) the aggregate of all capital contributions and loans made by members of Developer and/or their affiliates to Developer in respect of the Property. For example, if the Contingent Payment is $350,000 and the aggregate of all capital contributions and loans made by members of Developer and/or their affiliates to Developer in respect of the Property is $5,000,000, then City's Pro-Rata Share hereunder is 6.5%. 1.3 Term The Contingent Payment payable under this Agreement shall remain due and payable until the Property has been sold by Developer (with any final portion of the Contingent Payment payable to City to be calculated and paid in connection with the Capital Event which is the sale of the Property by Developer) or on the fiftieth (50`i') anniversary of the Effective Date, whichever first occurs. 1.4 Exchange or Sale of Interests in Property. In the event (i) Developer contributes the Property to another entity in exchange for an interest in such entity other than to a single purpose entity solely owned by Developer and for financing purposes (ii) 50% or more of the capital or profits interests within Developer are transferred in a single transaction or series of transactions to persons or entities who are not members of Developer on the date of this Agreement within a twelve month period (a twelve-month period is a period of twelve consecutive months and may span two calendar year), (ni) all or substantially all of the Property is master leased to a person or entity for a term (including all available extension options) of twenty (20) years or more, or (iv) the Property is sold but the proceeds of sale are retained by Developer for reinvestment (including but not limited to a sale intended to qualify for tax deferral under Section 1031 of the Internal Revenue Code) (each, a "Deemed Sale Event"), City may at the option of City made within 30 days of written notice from Developer to City of the Deemed Sale Event elect to treat the Deemed Sale Event as a sale of the Property, in which event the Property shall be deemed to have been sold for its fair market value on the date of the Deemed Sale Event and the net proceeds distributed to the members of Developer as Amounts Realized, and Developer shall make the calculation and payment of the Contingent Payment as provided in Section 1 1 above. 2. Annual Reports, Audit Rights So long as the Contingent Payment remains outstanding, Developer will make copies of the following information for review by an authorized representative of National Development Council ("NDC") or other financial consultant engaged by City, commencing with the fiscal year during which Final Completion of the Project occurs- (i) Developer's federal income tax return, (ii) financial statements for the Property, including balance sheet, statements of income, retained earnings and changes in financial position of such fiscal year, prepared in conformity with sound accounting practices applied on a consistent basis, (nii)operating expenses and rent roll for the Property, and (iv) Developer's calculation of Amounts Realized, if any, amounts distributed to members of Developer and City's Pro Rata Share of Amounts Realized thereof for such fiscal year, all certified as to accuracy by the general partner, manager, or managing member of Developer, as -3- PLM99 DRS120399 31T 09130MI I applicable. The contents of all tax returns for Developer and other financial information provided by Developer for review will be kept strictly confidential by NDC except to the extent required by law, and will be reviewed by NDC in Developer's office or other mutually convenient location, and Developer shall make a representative or employee of Developer familiar with the preparation of such financial statements, tax return and the operations of the Property available to respond to NDC's questions and comments about such information No more frequently than once each calendar year or as to any calendar year (unless an event of default by Developer shall have been declared, occurred and be continuing hereunder) City may i audit the books and records of Developer related to calculation of Contingent Payment upon thirty(30) days prior written notice to Developer. The audit must be conducted on a wholly non- contingent fee basis. If a Developer event of default has occurred in the payment of Contingent Payment hereunder the reasonable out-of-pocket cost of audits conducted by City hereunder shall be paid by Developer Otherwise audits shall be at City's sole cost and expense Developer agrees to cooperate with City and its designated representatives in any such audits and to instruct its property managers and employees similarly to so cooperate. City covenants to conduct any audit in a manner which does not disrupt Developer's operations. 3. Subordination. This Agreement shall be subject and subordinate to the construction loan ("Construction Loan") which Developer has obtained from its construction lender ("Construction Lender") to finance its purchase and/or planned development of Property and to all of the terms, covenants and conditions contained in the promissory note, deed of trust, and all other documents related to the Construction Loan (the "Construction Loan Documents") and any (i) refinancing of the Construction Loan, or (h)other arm's length loans with third party lenders, the proceeds of which shall be used solely in connection with the Property and which are secured by a lien on the Property only (provided such refinancing loans or other loans are on market terms and conditions). Without limiting the foregoing, the subordination contained in this paragraph shall automatically apply to any additional advances, extensions, amendments, or other modifications of the Construction Loan Documents and any such refinancing of the Construction Loan or other loans, the proceeds of which shall be used solely in connection with the Property and which are secured by a lien on the Property only, without the need for any written reaffirmation of subordination or other written agreement by City,but City covenants and agrees to execute such documents as Lender or a replacement lender may request to reflect and effectuate such subordination. 4. Notices. Any notice or other communication under this Agreement shall be in writing and shall be deemed given upon receipt by a party at the following addresses- Address of City: a n c/o Mr Kurt Hanson Economic Development Director City of Kent 220 41h Avenue South Kent, Washington 98032 With a copy to a -4- P 120399 DRB120399 31r OM0111 a } i City of Kent 220 Fourth Avenue South Kent, Washington 98032 Attn: City Attorney Address of Developer: c/o Goodman Real Estate Inc. 2801 Alaskan Way, Suite 310 Seattle, WA 98121 Attn: George Petrie, President Phone: (206) 215-9816 ; Fax: (206) 343-9579 Any such notices shall be. either (a) sent by certified mail, return receipt requested, (b) sent by overnight delivery using a nationally recognized overnight courier, or (c) sent by personal delivery. 5. Miscellaneous. 5.1 Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto and may not be amended or modified except in a written instrument signed by the party to be charged therewith. 1 P 5.2 Attorneys' Fees. Each party shall be responsible for the 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. 5.3 Captions. The paragraph titles or captions contained in this Agreement are inserted only as a matter of convenience of reference Such titles and captions in no way define, limit. extend or describe the scope of this Agreement nor the intent of any provision hereof. 3 5.4 Governing Law. This Agreement shall be governed by the laws of the state of Washington without regard to principles of conflicts of law and any action brought to enforce this Agreement 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. 5.5 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which shall constitute one agreement, binding on parties hereto, notwithstanding that the parties are not signatory to the same counterpart. 5.6 Real Estate Excise Tax. City shall be responsible for any real estate excise tax payable on the sale of the Option Property payable at Closing based on a purchase price for the Option Property of$802,000. Developer shall be solely responsible for, shall pay and report -5- PU0399_DR5 O399_37 OVMIII ,� 1 , 1 i 1 as and when due and shall indemnify, defend and hold City harmless from and against any real estate excise tax due in connection with payments received by City under the terms of this Agreement once the Contingent Payment amounts paid to the City under this Agreement plus the Base Option Price paid at Closing exceed $802,000, including all interest, penalties, liens, claims, fines, suits, costs, liabilities, damages and expenses related to such real estate excise taxes, which indemnification shall survive the expiration or other termination of this Agreement and payment of the Continent Payment. a 5.7. Successors and Assigns This Agreement shall be binding upon the parties hereto and their respective successors and assigns. 5.8 Nature of Relationship. The relationship between City and Developer is solely that of seller and buyer of the Option Property and nothing contained in this Agreement is intended to create any partnership,joint venture between City and Developer, or grant City an interest in the Project or the Property. 5.9 Recording. This Agreement shall not be recorded, but the parties shall execute a memorandum of this Agreement in a form mutually acceptable to both parties which will be recorded in the real property records upon closing of Developer's acquisition of the Option Property. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the first date written above. DEVELOPER: , a Washington limited liability company By: ,its Managing Member By: CITY: CITY OF KENT By. Name: Its: - -6- P 120399_ORSM99_31T OM11 t a a EXHIBIT A i CONTINGENT PAYMENT AGREEMENT ' Leeal Description of Property i 3 F S i A-1 P 120399 ORS20399 31T 09/30111 EXHIBIT L s 1 Public Parking Easement j L-1 P 120399_DRM20399 31R 09/30/11 i i t After Recording Return To: City of Kent 220 Fourth Avenue South Kent, WA 98032 ATTN City Attorney I a PUBLIC PARKING EASEMENT GRANTOR: GRANTEE: CITY OF KENT, a Washington municipal corporation Legal Description: Abbreviated form: Additional legal on page EXHIBIT B Assessor's Tax Parcel ID No(s).: Reference number(s)of Related Document(s): i 7 PUBLIC PARKING EASEMENT This Public Parking Easement is entered into this day of , by and between the City of Kent ("City"), a Washington municipal corporation and , a ("Developer") with reference to the following facts. RECITALS A. City is the fee simple owner of certain real property described in Exhibit A attached hereto ("Town Square Plaza Park"),which has been developed as a City park. B. Contemporaneous with the execution, delivery and recording of this Public Parking Easement, City is conveying to Developer the real property described on Exhibit B attached hereto (the "Kent City Center Property"), upon which Developer has agreed to construct a mixed-use project including residential apartments, retail space and associated parking. C. In consideration of the City's conveyance of the Kent City Center Property to Developer, Developer has agreed to execute, deliver and record this Public Parking Easement burdening a portion of the Kent City Center Property for the benefit of the City, Town Square Plaza Park and members of the general public. Now, therefore, in consideration of the foregoing recitals and the mutual covenants contained herein, City and Developer agree as follows: EASEMENT 1. Grant of Public Parking Easement. Developer hereby grants and establishes for the benefit of City, any successor public entity, Town Square Plaza Park and members of the general public, a perpetual non-exclusive easement (the"Easement") over, across and upon that portion of the Kent City Center Property depicted on Exhibit C attached hereto and hereby incorporated by reference (the "Easement Area"), for purposes of short-term public parking during normal business hours, seven days a week (i.e. 9:00 am to 5:00 pm), together with such rights of pedestrian and vehicular access as may be reasonably necessary for access, ingress and egress to and from the Easement Area 2. Degree of Use and Parking Hours. The Easement herein granted shall be for short-term public parking on the Easement Area during normal business hours as described above;provided, however: a. In no event shall the Easement Area include fewer than thirty-five (35) parking stalls; b. All parking provided pursuant to the Easement shall be at street grade level and not underground; c. In no event shall Developer charge City or City's invitees for the parking to be provided pursuant to the Easement; d. All parking provided to the public pursuant to the Easement shall likewise be available on the same terms to any tenants, employees, guests, mvitees, licensees or other visitors to the Kent City Center Property; and e. In no event shall Developer be responsible for any act or omission of a third party or be responsible for the failure to provide security or supervision for members of the general public in connection with use of the Easement Area for parking purposes pursuant to this Easement. 3. Maintenance and Repair of Easement Area. Developer shall maintain and repair the Easement Area in good, sate and sanitary condition, and operate the parking to be provided herein at Developer's sole cost and expense. Developer shall be entitled at any time and from time to time to temporarily close all or part of the parking within the Easement Area for the purpose of emergency or routine repairs, maintenance or periodic cleaning. All work shall be scheduled and conducted in a manner to minimize closure or unavailability of the 35 parking stalls located in the Easement Aiea for parking by members of the general public and to the greatest extent practicable all work shall be conducted after 5 p in on weekdays or on weekend. Developer shall limit access to the Easement Area by its contractors or maintenance personnel to those portions of the Easement Area necessary to conduct repairs, maintenance or periodic cleaning and shall promptly finish any work which necessitated closure of all or part of the parking within the Easement Area. 4. Payment of Taxes. Liens and Other Charges Developer will pay or cause to be paid prior to delinquency all taxes and special assessments, all charges for utilities or other services provided to the Kent City Center Property, and all encumbrances (including any debt secured by deeds of trust or security agreements), liens and/or other charges, together with interest due thereon which are filed against the Kent City Center Property when due and all costs and expenses related thereto. 5. Notices All notices under this Public Parking Easement and shall be in writing and shall be validly given or made to the other party if delivered 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 deemed given at the time of such 2 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: If to City: City of Kent 400 W Gowe Street Kent, Washington 98032 Attn•Economic Development Manager Fax. (253)856-6770 With a copy to City of Kent 220 Fourth Avenue South Kent, WA 98032 ATTN: City Attorney Fax: (253) 856-5706 If to Developer: Fax: Any party hereto may change its address for the purpose of receiving notices as herein provided by delivering written notice given in the manner required hereunder to the other parties hereto. . q 6. Severability. All provisions of this Public Parking Easement are severable and the invalidity or unenforceability of any provision shall not affect or impair the validity or enforceability of the remaining provisions 7. Binding Effect: Successors and Assigns. The rights and obligations of the parties hereto shall inure to the benefit of and be binding upon their respective successors and assigns and shall be deemed to run with the land. This Public Parking Easement (including the Exhibits hereto) may be amended or modified only by written instrument, 3 executed and acknowledged by the parties hereto or their successors or assigns, recorded with the King County Recorder. 8. Headings. The headings used herein are for convenience only and are not to be used in interpreting this Public Parking Easement. 3 9. Entire Agreement. This Public Parking Easement contains the entire agreement of the parties with respect to the subject matter hereof and supersedes any prior written or oral agreements with respect thereto. G 10, Enforcement Remedies and Attomeys' Fees. In the event of a breach of any of the covenants or agreements set forth in this Public Parking Easement, the City shall be entitled to anv and all remedies available at law or in equity, including, but not limited to the equitable remedies of specific performance or mandatory or prohibitory injunction issued by a court of competent jurisdiction, Each party shall 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 Public Parking Easement. 11. Governing Law and Venue. This Public Parking Easement shall be governed by Washington law Venue for any claim or action arising under this Public Parking Easement shall lie in the Superior Court in and for Ding County, Washington. 12. Counterparts. This Public Parking Easement may be executed in counterparts, each of which shall be deemed the original, but which together shall constitute one and the same instrument. DEVELOPER: CITY: THE CITY OF KENT, a Washington municipal corporation By By Name Name Title Title APPROVED AS TO FORM By Name Title i i 4 s CITY'S NOTARY PAGE F ^F STATE OF WASI NGTON ) )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/she signed this instrument, on oath stated that he/she was authorized to execute the instrument and acknowledged it as the of the City of Kent, a Washington municipal corporation 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 (Use flus space for mu nal sump/seal) 5 a i 1 DEVELOPER'S NOTARY PAGE STATE OF WASHINGTON ) )ss. COUNTY OF ) I certify that I know or have satisfactory evidence that is the person who appeared before me, and said person acknowledged that he/she signed this instrument, on oath stated that he/she was authorized to execute the instrument and acknowledged It as the of , a 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 (Use ttus space for wtana)stamp/seal) K 12069049M0002120136_111 r.120136A228 , 7 6 EXHIBIT A ' 1 Legal Description of Benefitted Property Portions of Parcel C and Parcel D, City of Kent Lot Line Adjustment No. LL-2005-375 Recorded January 10, 2006 under Recordmg No. 20060110002592, in King County, Washington. Note: Town Square Plaza Park will include a portion of Parcel C. Legal description will be revised following recordation of Boundary Line Adjustment. i � i � 3 t EXHIBIT B Legal Description of Burdened Property Parcels A, B and portion of C, City of Kent Lot Line Adjustment No LL-2005-37, Recorded January 10, 2006 under Recording No. 20060110002592, in King County, Washington. [Revised legal description to be attached prior to recording and reflecting City's boundary line adjustment of Parcel C] EXHIBIT C Depiction of Easement Area . p a 4 b d r EXMIT M List of Permitted Exceptions 1 Non-delinquent Real Property Taxes for [year in which Closing Occurs] 2 Easement. including terns and provisions contained therein: Recording Information May 27, 1946 under Recording No 3572715 For Sewer pipe Affects (New Lot A)as described therein 3. Easement, including terms and provisions contained therein: Recording Information June 17, 1976 under Recording No 7606170770 In Favor of Puget Sound Power&Light Company. a Washington corporation For: Pad Mount Switches and Vault with necessary appurtenances Affects: as described therein 4. The terms and provisions contained in the document entitled "Ordinance No 3608" recorded August 7, 2003 as Recording No 20030807000823 of Official Records. 5. Easement, including terms and provisions contained therein Recording Information January 6. 2005 under Recording No 20050106000575 In Favor o£ Puget Sound Energy, Inc , a Washington corporation For One or more electric utility systems t Affects: (New Lot A) as described therein 6. Sidewalk easement as contained and/or delineated on the face of the LLA No. LL-2005-37 recorded January 10, 2006,Recorders No 20060110002592, in King County, Washington. (i) City to provide documents to Title Company sufficient to remove the following exception from title to Option Property at closing "The terms, provisions and easement(s)contained in the document entitled "Parking Easement Agreemenf'recorded July 28, 2006 as Recording No 20060728002541 of Official Records" d (ii) City agrees to use good faith efforts to provide Title Company sufficient documentation to remove the following exception from title to the Option Property at Closing Covenants, conditions,restrictions andlor easements. Recorded June 5, 2008 Recording No 20080605000430 If despite such good faith efforts, City is unable to cause the removal of such exception, it shall constitute a Penmtted Exception M-1 P=399 DRSU0399 31R 09/30/11 EXHIBTT N Completion Guarantt N-1 P 120399_DRSQ0399 31R D9/3D/11 GUARANTY OF COMPLETION AND PERFORMANCE This Guaranty of Completion and Performance (this "Guaranty") is made effective this _ day of by John A. Goodman ("Guarantor") in favor of the City of Kent, a Washington municipal corporation("City"). RECITALS A. City, as lessor, and Goodman Real Estate, Inc ("Developer"), as lessee, have entered into that certain Lease (with Option to Purchase) dated September , 2011 (as may be amended or modified, the "Lease") of real property legally described therein (the "Property") B. As described in the Lease, Developer intends to develop the Property into a mixed-use development consisting of approximately 164 market rate, all-ages, urban-style rental apartments, approximately 3700 square feet of ground floor retail located at the intersection of 4th Avenue North and West Smith Street, and approximately 156 parking stalls of which 35 parking stalls would be available to City for short term public parking during normal business hours (the"Project'). C. Pursuant to the Lease, Developer has the right to purchase the Option Property(as defined in the Lease) from City, subject to satisfaction of certain conditions precedent set forth in the Lease. D. Developer has, in connection with an Approved Financing Plan (as defined in the Lease), exercised its right under the Lease to assign its right to purchase the Option Property to ("Owner"), and, pursuant to such assignment, the terms, covenants, agreements and conditions of the Lease are binding upon Owner insofar as they relate to Developer's obligations to perform the Project Obligations defined herein. Guarantor's agreement to deliver this Guaranty in favor of City, and to guaranty Owner's'-s obligations with respect to construction and completion of the Project, is an express condition precedent to Owner's exercise of its option to purchase the Option Property and City's obligation to sell the Option Property to Owner. E. Guarantor has a direct or indirect interest in Owner, and will derive substantial benefit from the Project GUARANTY Now, therefore, in consideration of the foregoing recitals, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and in order to induce City to sell the Option Property to Owner, Guarantor agrees as follows: i a t. Guaranty and Description of Guaranteed Obligations. In consideration of, and as an inducement for City's conveyance of the Option Property to Owner pursuant to the purchase option described in the Lease, Guarantor unconditionally guarantees to City the performance of any and all obligations required by or under the Lease with respect to the construction and development of the Project (the "Project Obligations"), including, without limitation, the obligations described in Section 15.B.(vi) of the Lease to timely commence construction of the Project, to diligently pursue and continuously prosecute the Project to completion, and to achieve Final Completion (as defined in the Lease) of the Project within the time period set forth in the Lease free and clear of Liens. Guarantor covenants and agrees to and with City that if default shall at any time be made in the performance and observance of any of the Project Obligations, Guarantor shall and will forthwith faithfully perform and fulfill all such Project Obligations. This is a guarantee of payment and performance and not of collection. All capitalized terms not otherwise defined herein shall have the meaning set forth in the Lease, which is by this reference incorporated herein as though fully set forth Notwithstanding anything to the contrary set forth herein, if City exercises its repurchase right set forth in Section 21 C of the Lease, this Guaranty and all obligations of Guarantor hereunder shall terminate and be of no further force or effect as of the date of City's repurchase. 2. City's Right to Cause Completion of Project Obligations. If for any reason whatsoever, Owner fails or neglects to commence or complete construction of the Project in the time and manner required under the Lease or fails to prosecute with diligence and continuity the construction and completion of the Project, then City may proceed under this Section 2. Within thirty (30) days from the date City notifies Guarantor of the occurrence of an event described in this Section 2, Guarantor shall, at Guarantor's sole cost and expense, commence completion of construction of the Project and pursue diligently such construction to completion in order to complete the Project within the time and in the manner specified in the Lease, free of defects in the construction thereof and free of Liens and fully paid for Guarantor shall pay all bills and expenses in connection with such construction and shall indemnify and hold City harmless from any and all losses, costs, liabilities, or expenses, including ; reasonable attorneys' fees, incurred in connection with such completion and/or performance. In addition, in the event Guarantor fails to complete the Project Obligations as required under this Guaranty, City may perform the Project Obligations (or cause the Project Obligations to be performed on City's behalf) and, in such event, Guarantor shall indemnify City for all costs, liabilities, or expenses, including reasonable attorneys' fees and costs, incurred in connection with such completion and/or performance. 3. Waivers Guarantor hereby waives (i) notice of acceptance of this Guaranty and notices of default and all other notices of every kind and description now or hereafter provided by or required under any statute or rule of law (ii) any right to require City to proceed against Owner or any other person at any time or to pursue any other remedy in City's power before proceeding against Guarantor, (u) any defense that may anse by reason of the incapacity, or lack of authority on the part of Developer or Owner to enter into or perform the Project Obligations;; (iii) City's partial x or total failure to exercise diligence in the enforcement of the performance of the Project Obligations or the granting of any extension to Owner, including without limitation, notice of the existence, creation or incurring of any modification to the Project Obligations, creation of new or additional obligations on the part of the Owner or of any action or non- action on the part of Owner, City or any other person, (iv) any duty on the part of City to disclose to Guarantor the financial condition of the Owner or the Project and of all circumstances bearing on the risk of non- performance of the Project Obligations, and (vi) notices of any renewal, extension, modification, compromise, settlement, increase, reduction, release or termination of the obligations of Owner to perform the Project Obligations. Guarantor hereby expressly agrees that the validity of this Guaranty and the obligations of Guarantor hereunder shall not be terminated, affected, diminished, or impaired by reason of the assertion or the failure to assert by City against Owner of any of the rights or remedies reserved to City pursuant to the provisions of the Lease. 4. Attorneys' Fees. Each party shall be responsible for the payment of the legal fees of its counsel in the event of any litigation or other proceeding brought to enforce this Guaranty. 5, Successors and Assigns; Separate Prgpertv. The execution of this Guaranty is primarily for business, investment or commercial purposes and not primarily for personal, family or household purposes. This Guaranty shall be binding upon the heirs, legal representatives, successors, and assigns of Guarantor, and shall not be discharged or affected, in whole or in part by the death, bankruptcy, or insolvency of Guarantor Whenever used in this Guaranty, the terms Guarantor, City, Developer and Owner shall include the respective successors and assigns of the party named as such. This Guaranty is binding on Guarantor's separate property only and not as to any community or quasi community property of Guarantor, if any.:_ Guarantor's obligations hereunder shall not be assigned or delegated. 6. Continuing Effect. This Guaranty is a continuing guaranty and the obligations of Guarantor under this Guaranty shall not be released or impaired for any reason whatsoever without the express prior written consent of City. Without limiting the generality of the foregoing, the obligations of Guarantor shall not be released or impaired on account of the voluntary or involuntary liquidation, sale or other disposition of all or substantially all of the assets of Owner or any receivership, insolvency, <3 1 1 L A bankruptcy, reorganization or similar proceeding affecting Owner or any of its assets; . The obligations of Guarantor hereunder shall survive and continue in full force and effect until the performance in full of the Project Obligations, notwithstanding any release or termination of any other existing or future guarantor of any debt of Owner to City, or any release or termination of the liability of Owner by express or implied agreement with k City or by operation of law, and notwithstanding that the Project ` Obligations or any part thereof are deemed to have been performed or discharged by operation of law or by some act or agreement of City 7. Remedies Cumulative. All remedies afforded to City by reason of this Guaranty are separate and cumulative and it is agreed that no one of such remedies, whether exercised by City or not, shall be deemed to be an exclusion of any other remedy available to City and shall not prejudice any other legal or equitable remedy which City may have City may bring a separate action against Guarantor whether or not City brings an action against Owner or joins Owner or any other guarantor in any such action or proceeding. 8. Duration of Guaranty, Subrogation and Subordination. This Guaranty shall remain in full force and effect until the full performance of all of the Project Obligations. Until the Project Obligations have been fully satisfied, Guarantor: a. Shall have no right of subrogation against Owner by reason of any payments or acts of performance by Guarantor in compliance with the obligations of Guarantor under this Guaranty; and b. Subordinates any liability or indebtedness of Owner now or ; hereafter held by Guarantor to the Project Obligations of Owner to City under the Lease and otherwise with respect to the Project 9. Waiver of Jury Trial. As a further inducement to City to convey the Option Property to Owner, and in consideration thereof, City and Guarantor covenant and agree that in any action or proceeding brought on, under or by virtue of this Guaranty, City and Guarantor shall and do hereby knowingly and intentionally waive trial by jury. 10. Modification. This Guaranty may not be changed, modified discharged or terminated orally or in any manner other than by a written agreement signed by Guarantor and City. 11. Venue: Choice of Law This Guaranty shall be governed by and construed in accordance with the laws of Washington. Venue for any action arising under this Guaranty shall lie in the Superior Court in and for King County, Washington i L 12. NO ORAL COMMITMENTS. NOTICE IS HEREBY GIVEN THAT ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, MODIFY LOAN TERMS, OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW. 13. Severability. If any of the provisions of this Guaranty or the application thereof to any person or circumstances, shall, to any extent, be determined to be invalid or unenforceable, the remainder of this Guaranty, or the application of any such provision to persons or circumstances other than those as to whom or which it has been determined to be invalid or unenforceable, shall not be affected hereby, and every provision of this Guaranty shall be valid and enforceable to the fullest extent permitted by law 14. Notices. All notices under this Guaranty shall be delivered by certified or registered mail, return receipt requested, the address of Guarantor set forth below. [signatures on following pagel i GUARANTOR: John A. Goodman Address for Notice: c/o Goodman Real Estate, Inc. 2801 Alaska Way, Suite 310 Seattle, WA 98121 Attn: John A. Goodman 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 acknowledged it to be his free and voluntary act for the uses and purposes mentioned in the instrument Dated- Notary Public Print Name My commission expires a EXHIBIT O Permit Summary k 3 s 0-1 PV0399_DR=0399_31R 09wil a 1. Council selected Alternative#2 from Kent Station Supplemental Environmental Impact Statement(SEIS), Notice of Action states planned action applies to Alternative#2 Planned Action Ordinance Area includes Smith/Harrison and 2"d/4m 2. City Center Proposal: 164 residential units,3700 square feet of retail on the 1"floor, 156 parking stalls total with 121 of those dedicated to the residential use. The building would be 5 stones altogether, including the parking/retail on the 1"floor. 3. Alternative #2 for the Smith/Harrison and 2"d/4" area shows 3 buildings—two at 5 stones, and one 4-story parking structure as well as 100 residential units, although 480 residential units were analyzed for the entire PAO area. City Center proposal likely will be considered a planned action. 4. Pre-application meeting would be beneficial. 5. Impact Fees, Transportation Impact Fee is applicable: 164 residential units $1946= $319,144, 3700 sq.ft.for specialty retail 'x' $2.42=$9,954, Total$328,098+Admin Fee of $3,280.98 =grand total of$331,378 98 Developer may prepare for approval an independent fee calculation/traffic study that provides an alternative proposal for calculating trip generation numbers and transportation impact fees (12 14 070 KCC). School Impact Fee: $3,378 per multifamily dwelling unit; $0 per multifamily studio dwelling units. 6. Permits required, Demolition &street use(+/-$600), civil construction, lot line adjustment, building, downtown design review if no multifamily tax exemption,downtown, multifamily and mixed use design review if multifamily tax exemption, sign 7 SEPA checklist needed for demolition as well as for buildings. 8. Detention likely to be underground storm water facility(+/-$250,000-$300,000). Area was previously impervious,thus no impervious fees. No water quality facility required in downtown. 9. Notice of Application unlikely to be required, although GMA encourages public notice. 10. Utility/Transformer boxes to be placed underground or relocated to be out of sidewalk area. 11. Transportation Management Plan is required with goal to reduce percentage of SOV trips within specified time period Plan to be coordinated with City. 12. SEIS contains air quality mitigation measures to be followed; See Planned Action Ordinance for complete list of mitigation measures for PAO area. 13 Kent Station (Tarragon) might develop latecomer's agreement to reimburse proportionate share of offsite transportation improvements,except waiver is written in developer's agreement for properties owned by the City as of 1/20/04 regardless of future ownership Tom is checking on ownership but it's likely most was city property and covered under the waiver. ; 14. Street trees and 3-foot landscape buffer for parking are required (see Meeker Law Building). 15. Developer needs to submit parking analysis showing proposal adequately addresses parking needs Although the proposal includes a total of 165 parking stalls, only 121 are designated for multifamily dwellings 15 05 070(B) KCC requires one parking space per unit for multifamily residential development. Multifamily tax exemption eligibility requirements state parking shall be in structured garage, underground, or under buildings (3 25 040(F) KCC) I t 16. Does sign project into ROW? Looks like it is on-site. Should it be assumed that the sign will meet code requirements for size, etc 7 Furthermore, do the window signs go only where the retail space will be located? 17. Local Appeals- PAO/EIS can no longer be appealed,'no threshold determination is required if determined to be a planned action, so no appeal (Notice of Action for PAO/EIS issued 7/22/02 which established the appeal timeline) Building permit can be appealed by any person aggrieved or adversely affected by the decision. Civil construction approval may be appealed by developer regarding'nature, location and extent of infrastructure improvements'—to Hearing Examiner and then can be appealed to City Council (6 02.100 KCC) No appeal of decisions on compliance with construction standards Street use permit—denial, revocation,suspension or restriction may be appealed to Hearing Examiner by any person aggrieved by the action (6 07.190 KCC►. Grade & Fill Permit—Brennan is checking but may be similar to building permit appeal. Lot line adjustment and design review—parties of record may appeal to Hearing Examiner. 18. Applicant should coordinate with METRO on bus stop location,which is currently located on north side of building. 19. Civil construction drawings: Civil Plans for the project need to be prepared to accommodate the new site plan The following is a short list of important items that need to be completed. The utilities that are installed in the alley(3rd Ave)need to be removed including side sewers and grease interceptor vault, storm drainage conveyance and oil water separator vault, and possibly some water main stubouts to the property. The water meters for the site are not installed-- two or more meters may be required depending on the design of irrigation systems (cost unknown because meter size has not been determined). The previous design included 2 DDCV which were never installed-one along Harrison and one along W Smith . Sidewalk repairs along Harrison and completion of sidewalk along W.Smith are needed. Commercial driveways will be required at new driveway locations per City of Kent Standard 6-43; 130-feet full street overlay along W Smith,Tree missing along W Smith, Light missing along W Smith Total cost of main items+/- $365,000 excluding water meters,detention and miscellaneous. Walk-through with inspection team necessary for more detailed punch list Public Works or Parks would finish the east half of Harrison Street overlay. Developer may need to overlay Y street of the west half of Harrison Street. In general, utility improvements and street overlays are required; developer may or may not wish to use infrastructure installed with the Springboard development. 20 After City Center development, remaining PAO thresholds: 201,233 sq.ft.commercial, 200 rooms hotel/conference center, 326 housing units, 1158 parking stalls,470 PM peak hour trips. Open space exceeds SEIS/PAO requirement by 8400 sq ft PM Peak hour trips from City Center proposal= 104 for residential and 10 for specialty retail. (This does not incorporate recent minor addition to Kent Station restaurant } S�%Parmlt�Plan\kantatatlonNKant StatlenPA0eommanU093011h dor. EXHIBIT P Pro Forma Ow ner's Policv F P-1 P V0399_DRS=399_31R 0913011' , Form No. L402.06 = Policy Page 1 � 4 ALTA Owners Policy(6-17-06) s Policy Number: NCS-502043-WAL N1100302PO50600 _ lh OWNER'S POLICY OF TITLE INSURANCE '+ ISSUED BY t First American Title Insurance Company r Any notice of claim and any other notice or statement in writing required to be given to the Company under this policy must be Irk' t given to the Company at the address shown in Section IS of the Conditions. { COVERED RISKS rrt14 � SUH)ECT TO THE EXCLUSIONS FROM COVERAGE,THE EXCEPTIONS polite power not covered b1'Covered Risk 5 if a notice of the �' S FROM COVERAGE CONTAINED IN SCHEDULE B AND THE enforcement al describing any part of the land,is recorded CONDITIONS, FIRST AMERICAN TITLE INSURANCE COMPANY, a in the Public Records,but only to the extent of the enforcement { f ' California corporation (the"Compain Insures, as of Date of Polley referred to in that notice, and, to the extent stated In Covered Risks 9 and 10, after Date of 7. The exercise of the rights of eminent domain if a notice of the ` Polity, against loss or damage, not exceeding the Amount of exercise, descnbng any part of the Land, is recorded in the 1 Insurance,sustained or incurred by the Insured by reason of• Public Records + •t L Title being vested other than as stated In Schedule A 5. Any taking by a governmental body that has occurred and is ; .j 2 Any defect In or lien or encumbrance on the Title This Covered binding on the right of a purchaser for value without Knowledge Risk includes but is not limited to Insurance against loss from 9 Title being vested other than as stated In Schedule A or being (a (a) A defect in the Tide caused by defective = - s ! (I) forgery, fraud, undue influence, duress, Incompetency, (a) as a result of the avoidance in whole or in part, or from a " 3! sxapaaty,or impersonation, court order providing an alternative remedy,of a transfer of t (11) failure of any person or Entity to have authorized a all or any part of the title to or any Interest In the Land , transfer or conveyance, occurring prior to the transaction vesting Title as sham in (oil) a document affecting Title not properly created, Schedule A because that prior transfer constituted a executed,witnessed,sealed,acknowledged,notarized,or fraudulent or preferential transfer under federal bankruptcy, # delivered, state Insolvency,or similar creditors'rights laws,or '• ' (iv)failure to perform those acts necessary to create a (b) because the instrument of transfer vesting Title as shown in t document by electronic means authorized by law, Schedule A constitutes a preferential transfer under federal b, (v) a document executed under a fahsll expired, or bankruptcy,state insolvency,or similar creditors'rights laws •i rr otherwise Invalid power of attorney, by reason of the failure of its recording In the Public Records 1, I (vi)a document not properly filed, recorded, or Indexed In (i) to be bmely,or the Public Rem,ds including failure to perform those acts (i) to impart notice of Its existence to a purchaser for value 1 • . by electronic means authorized by law,or or to a judgment or lien creditor t (vli)a defective judicial or administrative proceeding 10 Any defect in or lien or encumbrance on the Title or other matter R i (b) The lien of real estate taxes or assessments imposed on the mil in Covered Risks 1 through 9 that has been created or 1� Title by a governmental authority due or payable,but unpaid attached or has been filed a recorded In the Public Records 1 M (c) Any encroachment, encumbrance, violation, variation, or subsequent to Date of Policy and pnor to the recording of the 3. adverse orcumstance affecting the Title that would be deed or other instrument of transfer in the Public Records that " disclosed by an accurate and complete land survey of the vests Tlde as shown in Schedule A Land The term "encroachment" includes encroachments of existing improvements located on the Land onto adjoining The Company will also pay the costs, attorneys'fees, and expenses ys t land, and encroachments onto the Land of existing Incurred in defense of any matter Insured against by this policy,but K Improvements located on adjoining land only to the extent provided in the Conditions 3. Unmarketable Title { '4. No right of access to and from the land F'wsr,rlawrfrr+s''9ix1c•lnsrrrYlrrCc Cnny3xrr;y 5 The violation or enforcement of any law, ordinance, permit, or governmental regulation(including those relating to building and "M zoning)restricting,regulating,prohlbkhig,or relating to ' (a) the occupancy,use,or enjoyment of the Land, r,irenr� L! ¢H'r'��"' armmaao (b) the character, dimensions,or location of any improvement erected on the Land, + (c) the subdivision of land,or (d) environmental protection if a notice, describing any part of the Land, Is recorded In the - Public Records sethng forth the violation or intention to enforce,but only to the extent of the violation or enforcement " t referred to in that notice 1 i 6 An enforcement action based on the exercise of a governmental J i Jr r 7 Ki0 .T f�iJ y(6 baPic', po�y 3-WAI..�n�t"t" t"A ALTO Owner's Policy(6-17-06) PortLy Number.NCS-�2043-WAl EXCLUSIONS FROM COVERAGE (N) with regard to(A), (B� (C),and (D)reserving, however, ap rights , The following matters are expressly seduced horn the coverage d this policy,and and defenses as to any me esmr that the Cumpany would have had the Company will not pay loss 0,damage,costs,attorneys'fees,or expenses that against any predecessor Insured arise by reason of (a) 'Insured Claimant" An Insured claiming loss or damage L (a) Any law,ordinance,permit,or govemmeihthl regulabnn(including those (f) "Knowledge or"Known" Actual knowledge, net constructive bawledge relating to bwkhng and mnrrg) restricting, regulating, Prowling, or or notice that may be imputed to an Insured by reason or the Public relating to Records or any other records that impart constructive notice of matters (l the occupancy,use,or enjoyment of the land, arfecbrig the TW (ill)the character,dimensions,or bcatlon of any Improvement erected on (g) 'Land' The land described In Schedule A,and affued mprovemesi s that the Land, by law constitute real properly. The term"Land'does not include any (nq the subdivision of land,or property beyond the litres of the area described in Schedule A,nor any (w) environmental protedwn; right, btle, Interest, estate, or easement In abutting streets, roads or the effect of arty violation of these laws, ardiranhces, a governmental avenues,alleys, lanes,ways,or waterways,but this does not modify or , limit the coverage provided Ilmtt the extent that a right of access to and from the Land is Insured by regulations This Exclusion 1(a)does not modify or l under Covered Risk 5 this policy (b) Any governmental police power This Exclusion 1(b)does not noddy or (h) Mortgage' Mortgage, deed of trust, bust deed, or other security limit the coverage provided under Covered Risk 6 instrument, including one evidenced by electronlc meal authorized by 2. Rights of eminent domain This Exclusion does not modify of limit the law coverage provided under Covered Risk 7 or 8 (1) "Public Records'. Records established under state statutes at Date of 3 Defects,bens,enaimbrances,adverse claims,or other miners; Policy for the purpose of Imparhng constructive notice of matters retailing (a) created,su'lered,assumed,or agreed to by the Insured Claimant; to real property to purchasers for value and wits oit shall also Include ` (b) not Known to the Comparry,not recorded in the Public Records at Date of respect lip Covered Risk 5(d), alue Policy,but Known to the Insured Claimant and net disclosed in wribng to environmental protection (lens tiled in the recoms of the derk of the the Company by the insured Clamant prior to the date the Insured United States Dish"Court for the district where the Land Is located Claimant became an Insured under this policy, (p "Tithe'The estate or interest described In Schedule A (c) resulbng in no loss or damage to the Insured Clamant, (k) "Urrriarketable Title- Title affected by an alleged or apparent matter that (d) attaching or created subsequent to Date of Policy(however,this does not would permit a prospective Purchaser or lessee of the Title or tender on , modify or limit the coverage provided under Covered RmVs 9 and 10),or the Title to be released from the obligation to purchase,lease,or lend If (e) resulting In loss or damage that would not have been sustained If the there Is a contractual condihen requiring the delivery of marketable btle insured Claimant had Paul value for t a Ttle 4 Any claim,by realm or the operation of federal bankruptcy,state insolvency, 2. CONTINUATION OF INSURANCE or smiles creditors'rights laws,that the transaction vesting the Title as shown The coverage of this policy shall continue in Force as of Date of Policy in favor in Schedule A,Is of an Insured,but only so bhp as the Insured retains an estate or Interest In the (a) a fraudulent conveyance or fraudulent transfer,or land,or holds an obligation secured by a purchase money Mortgage given by a (b) a preferential transfer for any reason not stated In Covered Risk 9 of this purchaser �thee Insured, Orol0 long sto Insured ehall havepolicy liablty by policy from s In r orconveyance r the Title not S. Any hen on the Tick for real estate taxes or assessments Imposed by continue M force in favor of any purchaser from fie Insured of either(i)an estate governmental authority and created or attaching between Date of Polky and or Interest In the land,or(11)an obligation secured by a purchase money Mortgage the date of recording of the deed or other Instrument of transfer in the Public given to the Insured Records that vests Title ac shown in Schedule A 3. NOTICE OF CLAIM TO BE GIVEN BY INSURED CLAIMANT CONDITIONS The Insured shall rotlfy the Company promptly In writing(1)In case of any 1 DEFINITION OF TERMS Ilbgatlon as set forth In Section 5(a)of these Conditions,(ll) in case Knowledge The following terms when used in this policy mean' shag come to an Insured hereunder of any clam of title or merest that is adverse (a) 'Amount of Insurance" The amount slated in Schedule A, as may be to the Title, as Insured, and that might cause loss or damage for which the Increased or decreased by endorsement to this pollcy, Increased by Company may be gable by virtue of this policy, or(m)if the Tide,as insured,!s Section 8(b),or decreased by Sections 10 and 11 of these Conditions rejected as Unmarketable Title If the Company is prejudiced by the failure of the (b) "Date of Pole/' The date designated as"Date of Policy'in Schedule A. Insured Claimant be provide prompt notice,the Company's lability to the Insured (c) "Entity' A corporation, partnership, trust, limited lability company, or Claimant under the policy shag be reduced to tre extent of the prejudice other similar legal entity (d) "Insured" The Insured named in Schedule A 4. PROOF OF LOSS (1) The term"Insured"also includes In the event the Company Is unable to determine the amount of log or (A) successors ro the Title of the Insured by operation of law as damage,the Comparry may, at its option,require as a condition of payment that distinguished from purchase,Including heirs,devisees,survivors, the Insured Claimant furnish a signed proof of loss The proof D'loss must describe personal representatives,or next of kin, the defect,hen,encumbrance,or other matter insured against by this policy that (B) successors to an Insured by dissolution, merger,corsogdatbn, constitutes the basis of loss or damage and shall stale,to the extent possible,do distribution,or morgarkation, bass of calculating the amount of the loss or damage (C) successors to an Insured by Its conversion to another kind of Entity, S. DEFENSE AND PROSECUTION OF ACTIONS (D) a grantee of an Insured under a deed delivered without (a) Upon written request by the Insured,and subject be the options contained payment of actual valuable consideration conveying the Title In Section 7 of these Conditions,the Company,at its awn cost and without (1) it the stock,shares,memberships,or other equity interests unreasonable delay, shall provide for the defense of an Insured In of the grantee are wholly-owned by the named Insured, litigation In which any third party asserts a claim covered by this policy (2) it the grantee wholly owns the named Insured, adverse to the Insured This obligation s limited to only Lose stated (3) it the grantee Is wholly-owned by an affiliated Entity,of the causes or action alleging matters insured against by this policy The named Insured, provided the affiliated Entity and the Company shall have the right to select counsel of its choice(subject to the , named Insured are both wholty-owned by the same person right of the Insured to object for reasonable cause) to represent the or Enbty,or Insured as to those stated causes of action It shall rat be liable for and (4) If the grantee is a trustee or bene0eary of a trust created will not pay the fees of any other counsel-The Company will not pay any by a writer instrument established by the Insured named fees,costs,or experses incurred by the Insured in the deface of those In Schedule A for estate planning purposes, causes of action that allege matters not Insured against by this policy (b) The Company shag have the right,in addition to the options contained in Rust American Tide Insurance Company Kge3,,dam ,§fit"� :i4br"wObr�. il .,' ALTA Owners➢obey(6-17-06) Policy Number NCS-502043-WAL Section 7 of these Cordbons,at Its own cost,to institute and prosecute attameys'fees,and expenses incurred W the insured Claimant that were any action or proceeding or to do any other act that in its opinion may be authorized by the Company up to the lane of payment and that the necessary or desrable to establish the Title,as insured,or to prevent or Company Is obligated to pay reduce loss or damage to the Insured The Company may take any Upon the exerme by the Company of either of the options provided for in appropriate action under the terms of this policy,whether or not It shall subseWons(b)(i)or(II),the Company's obligations to the Insured under this be liable to the Insured The exercise of these rights shag not be an policy for the daimed loss or damage,other than the payments required to he admission of liability or waiver of any provision of this policy If the made,shall terminate,including arty liability or obligation to defend,prosecute, Company exercises ft bights under this subsection, R must do so or continue arty litigation diligently (c) Whenever the Company brings an action cr asserts a defense as required B. DETERMINATION AND EMNT OF LTABILr7Y or permitted by this policy,the Company may pursue the litigation to a This policy is a contract of indemnity against actual monetary loss or damage final determination by a court of competent Jurisdiction,and It expressly sustained or incurred by the Insured Clamant who has suffered loss or damage ly reserves the right,In Its sole dbveton,to appeal any adverse Judgment reason of matters insured against try this policy or order (a) The extent of liability of the Company for loss a damage under this policy shall not exceed the lesser of 6. DUTY OF INSURED CLAIMANT TO CODPERATE (i) the Amount of bsur ince,or (a) In all cases where this policy permits or requites the Company to (II) the difference between the value of the Title as Insured and the value prosecute or provide for the defense of any action or proceeding and any of the Title subject to the nsk insured against by this policy. appeals, the Insured shall secure to the Company the right to so (b) If the Company pursues Its rights under Section 5 or these Condibons and prosecute or provide defense in the action or proceeding,including the is unsuceassul In establishing the Title,as Insured, right to use, at Its option, the name of the Insured for this purpose (D the Amount of Insurance shall be Increased by LDi and Whenever requested by the Company, the Insured, at tfhe Company's (if) the Insured Clamant shall have the right to have the Im or damage expense, shall give the Company all reasonable aid•D in securing determined either as of the date the claim was made by the Insured evidence, obtaining witnesses, prosecuting or deferring the action or Claimant or as of the date Its settled and paid proceeding,or effecting settlement,and(II)in any other lawful act that in (c) In addition to the extent of liability under(a)and(b),the Company w1 the opinion of the Company may be necessary or desirable to establish also pay dress costs,attorneys'fees,and expenses Incurred in accordance the Title or any other matter as insured If the Company hs prejudiced tit' with Sectlom 5 and 7 of these Conditions the falls a of the insured to furnish the required cooperation, the Company's obligations to the Insured under the policy shall terminate, 9. LIMITATION OF LIABILITY Including any liability or obligation to defend,prosecute,or continue any (a) If the Company establishes the Tllle,or removes the alleged defect,lien, litigation, with regard to the matter or matters requiring such or encumbrance, or cures the lack or a night of access to or from the cooperation Lard, or cures the claim of Unmarketable Tilde, all as insured, In a (b) The Company may reasonably require the Insured Clakrant to submit to reasonably diligent manner by are/method, including litigation and the examination under oath by any authorized representative of the Company completion of any appeaLS it shall have fully performed Its obligations and to produce for examination, Inspection, and copying, at such with respect for that matter and shall not be liable for any loss or damage reasonable times and places as may be c1mgnatec by the authorized caused to the Insured, representati of the Company, all records, In whatever medium (b) In the event of arry litigation,including litigation by the Company a with i maintained, including books, ledgers, checks, memoranda, the Company's mnsent,the Company shall have no lability for loss or correspondence, reports, e-mails, disks, tapes, and videos whether damage until there has been a final determination by a court of bearing a date before or after Date of policy,that reasonably pertain to competer1 jusdiction,and dlspos li of all appeals,adverse to the Title, the loss or damage- Further, If requested try any authorized as Insured representable of the Company, the Insured Claimant shall grant Is (c) The Company shall rot be liable for loss or damage to the Insured for permission,In writing,for any authorized representative of the Company liability voluntarily assumed by the Insured in settling any claim or suit to examine, aspect, and copy all of these records in the custody or without the prior written consent of the Company control of a third party that reasonably pertain to the Ins or damage.All Information designated as confidential by the Insured Claimant provided 20.REDUCTION OF INSURANCE; REDUCTION OR TERMINATION OF to the company pursuant to this Section shall not be disclosed to others LIABILITY unless,in the reasonable judgment of the Company,It Is necessary In the All payments under this policy, except payments made for msts,attorneys' administration of the claim failure of the Insured Claimant to submit for legs,'and expenses,shall reduce the Amount of Insurance by the amount of the exammahon under oath,produce any reasonably requested information, payment. or grant permission to secure reasonably necessary Information from third parties as required in has subsection, unless prohltded by law or 11. LIABLLIfYNONCUMULATIYE governmental regulabon, shall terminate any liability of the Company The Amount of Insurance shall be reduced try any amount the Company pays under thin policy as to that claim. under any policy Insuring a Mortgage to which exception s taken in Schedule B or to which the Insured has agreed,assumed,or taken subject,or which Is executed 7. OPTIONS TO PAY OR OTHERWISE SETTLE CLAIMS;TERMINATION by an Insured after Date of Policy and which is a charge or lien on the Title,aid OF LIABILITY the amount so paid shall be deemed a payment to the Insured under this policy In case of a claim under this policy, the Company shall have the fdbwmg additional options: 12.PAYMENT OF LOSS (a) To Pay or Tender Payment of the Amount of Insurance When Lability and the extent of hiss or damage have been definitely tired In To pay or tender payment of the Amount of Insurance under this policy accordance with these Conditions,the payment shall be made within 30 days together with any costs,attorneys'fees, and expenses incurred by the Insured Claimant that were autionlred by the Company Lip to the bore of 13.RIGHTS OF RECOVERY UPON PAYMENT OR SETTLEMENT payment or tender of payment and that the Company is obligated to pay (a) Whenever the Company shall have settled and pad a claim under this Upon the exercise by the Company of this option, all liability and policy, It shall be subrogated and entitled to the nghts of the Insured obNpabons of the Company to the Insured under this policy,other than to Claimant in the Tile and all other rights and remedies in respect to the make the payment required in this subsection,shall corporate,Including claim that the Insured Claimant has against any person or property,to the ary,liability of obligation to de`end,prosecute;or mnbrhure achy litigation extent of the amount of any loss,costs, attorneys' fees, and expenses (b) To Pay or Otherwise Settle With Parties Other Than the Insured or With paid by the Company If requested by the Company,the Insured Claimant the Insured Claimant shall execute documents to evidence the transfer to the Company of these (I) To pay or otherwise settle with other parties for or in the name of an rights and remedies The Insured Claimant shall permit the Choi to Insured Claimant any claim Insured against under this policy In sue,compromise,or settle in tre name of the Insured Claimant and to addition, the Company vbli pay any costs, attorneys' fees, and use the came of the Insured Claimant In any transaction or litigation expenses Incurred by the Insured Claimant that wpm authorized by Involving these rights and remedies the Company up to the time of payment and that the Company is If a payment on account of a clavn does not fully cover the loss of the obligated to pay,or Insured Claimant, the Company shall defer the exercise of is right to (0) To pay or ottxmise settle with the Insured Clamant the low or recover Until after the insured Claimant shah have recovered is loss damage provided for under this policy, topelto with any costs, P P. F c�l'ter,.N n.c�, P F 0 F` First American TitleInsurance Company I TT = ! ageA 4lAigvN L Policy Number.NCS-50 TA Ow � i, (b) The Compares right of subrogabion Induces the rights of the Insured to (d) Each endorsement to this policy issued at any time Is made a part of the indeninitles, guaranties, other policies of insurance, or bonds, policy and is subject to all of its terms end provisions Except as the notwithstanding any terns or conditions contained in those Instruments endorsement expressly states,it does not(I)modify any o`the terms and that address subrogation rights provisions of the poky,(n)modify any prior endorsement,Cm)extend the Date of Policy,or(w)increase the Amount of Insurance. 14.ARBITRATION Ether the Company or the Insured may demand that the daim or conhovesy 15.SEVERABILITY shall be submitted to arbitration pursuant to the Title Insurance Arbitration Rules of In the event any provision of Uxs policy,in whole or in part,Is held invalid or the Amencan Land Ttie Assoclabon ("Rules') Except as provided In the Rules, unenforceable under applicable law,the policy shall be deemed not to irclude that there shag be no Joinder or consolidation with claims or controversies of other provision or such part held to be invalid,but all other provisions shall remain in full persons Arbtrable matters may include,but are not limited to,any controversy or force and effect dam between the Company and the Insured amang out of or relating to this policy, am service h connection with its Issuance or the breach of a policy 17.CHOICE OF LAW,FORUM provision,or to any other coiltrbversy or calm failing out of the transaction giving (a) Choice of taw The insured acknowledges the Company has Underwritten rise to this policy All arbitrable matters when the Amount of Insurance Is the risks covered by this policy and determined the premium charger) $Z00D,ODD or less shall be arbtrated at the option of ether the Company or the therefore in relianca upon the law affecting interests in real property and Irtsiired. All arbitrable matters when the Amount of Irsurance is in ocrrss of applicable to the interpretation, rights, remedies, or enformment of 52,000,D0O shall be arbitrated Only when agreed to by both the Company and the policies of tide insurance of the jursdicuon where the Land is located, Insured Arbitration pursuant to this policy and under the Rules shall be boding Therefore,the court or an arbitrator shall apply the law of the JunsdICbm upon the parties judgment upon the award rendered by the Arbibator(s)may be where the Land Is located to determine the validity of claims all the entered In any court of competent junsdicbon Tide that are adverse to the Insured and to Interpret and enforce the terms of this policy In neither case shalt the court or artil"tor apply its t 15. LIABILITY LIMITED TO THIS POLICY,POLICY ENTIRE CONTRACT conflicts of law principles to determine the applicable law (a) This policy together with all endorsements,if any,attached to it by lose (b) Choice of Forum Arty litigation or other proceeding brought by the Company is the enure policy and contract between the Insured and the Insured against the Company must be filed only In a state or federal court Company In interpreting any provision of this policy,this policy shaft be within the unted States of America or Its terrltones having appropriate mnsturrued as a whole jurisdiction (b) Any claim of loss or damage that arises out of the status of the Title or by any adlan asserting such claim shall be restricted to this Policy 19.NOTICES,WHERE SENT (c) Any amendment of or endorsement to this policy mist be in writing and Any notice of claim and ary other notice or statement in wrung required to be authanbcated by an authorized person, or expressly Incorporated by ge'co to the Company-under this policy must be glVen to the Company at 1 First Schedule A of this policy American Way,Santa Ana,CA 92707,A'tn Claims DepartrneO POLICY OF TITLE INSURANCE A Fdl F t C i PIO FORMS e rr First American Title Insurance Company 24° i rnPF' ALT s uy 6.17-06) Policy Number PROFORMA POLICY SCHEDULE A This m a Pro Forma Policy Rrrnrshed to or on behalf of the party to be insured It nerther reflects the presentstatos of fitly nor is it intended to be a commitment to Insure. The mduston of WdOrsementS as a part of the Pro Forma Policy in no way evidences the willingness ofFrrstAmerfcan title Insuranre Company to provide any affirmative coverage shown therein. There are requirements tbatmust be met before a flea/policy on be issued in the same form as this Pro Fora Pobcy A Cammfbnent to insure setting forth these requirements should be obtained from the Company. d a First American Title Insurance Company Name and Address of the issuing Title Insurance Company. First American Title Insurance Company 818 Stewart Street, Suite 800 Seattle,WA 98101 File No.: NCS-502043-WAI Policy No.. NCS-502043-WAS Address Reference: APN 982570-0520,982570-0515„982570-0505, ,WA Amount of Insurance: $to be determined Date of Policy: date of recording at time of recording 1. Name of Insured: Goodman Real Estate,Inc 2. The estate or interest in the Land that is insured by this policy is: 1 Fee Simple 3. Title is vested in: Goodman Real Estate,Inc,a Washington corporation 4. The Land referred to in this policy is described as follows: I Real property in the City of,County of King,State of Washington,described as follows: PARCEL 1: LOT A,CITY OF KENT LOT LINE ADJUSTMENT NO. LL-2005-37, RECORDED JANUARY 10, 2006 UNDER RECORDING NO 20060110002592,IN KING COUNTY,WASHINGTON PARCEL 2: LOT. CITY OF KENT LOT LINE ADJUSTMENT NO. RECORDED UNDER RECORDING NO. APN:982570-0505 and 982570-0520-00 and 982570-0515-07 PRO F RMI Flrst American Tltle Insurance Company ;r 5 0 0,q N9 jMO2=96!A P_:-�'Doilcy Gage 6 1�-�Sy Ya' A ALTA Owner's Policy(6-17-06) Policy Number NCS-502043-WA3 I SCHEDULE B File No.: NCS-502043-WAl Policy No NCS-502043-WAl EXCEPTIONS FROM COVERAGE This Policy does not insure against loss or damage,and the Company will not pay costs, attorneys' fees, or expenses that arise by reason of. 1. Taxes and assessments which are not shown as existing liens by the records of any taxing authority that levies taxes of assessments on real property or by the public record. 2. (A) Unpatented mining claims; (6) Reservations or exceptions in patents or In Acts authorizing the issuance thereof; (C) Water rights, claims or title to water, whether or not the , matters excepted under (A), (B) or (C) are shown by the public records; (D) Indian Tribal Codes or Regulations, Indian Treaty or Aboriginal Rights, including easements or equitable servitudes. 3. Any service, installation,connection, maintenance,constriction, tap or reimbursement charges/costs for sewer,water,garbage or electnoty 4. Liability, if any, for pro-rata portion of Real Property taxes which are carried on the King County Tax Roils, as tax account no. 982570-0520-00,are exempt. We note Special Charges for the year 2011 in the amount of$168 67,of which $168.67 has been paid. Balance due. $0,00. (Affects Parcel 1) i 5. Liability,if any,for pro-rats portion of Real Property taxes which are carried on the King County Tax Rolls, as tax account no. 982570-0515-07, are exempt. We note Special Charges for the year 2011 in the amount of$33.66,of which$33.66 has been paid Balance due: $0.00. (Affects portion of Parcel 2) 6. Liability, if any,for pro-rata portion of Real Property taxes which are camed on the King County Tax Rolls, as tax account no 982570-0505-09, are exempt. We note Special Charges for the year 2011 in the amount of$119.88,of which$119.88 has been paid. Balance clue- $0 00. (Affects portion of Parcel 2 and other property) 7. Easement,including terms and provisions contained therein; Recording Information: May 27, 1946 under Recording No.3572715 For: Sewer pipe p�'� 0Affects: Parcel 1 as described therein PRO �,,i y^ + �p gv, First American The Insurance company � S"mi'N1ii R �Y pag V)ff'�.li iilA ALTA thvrrrcls Policy(6-17-06) PoNcy Number 2043-WAI B. Easement,including terms and provisions contained therein: Recording Information. June 17, 1976 under Recording No. 7606170770 In Favor of, Puget Sound Power&Light Company, a Washington corporation For: Pad Mount Switches and Vault with necessary appurtenances Affects: as described therein 9. The terms and provisions contained in the document entitled"Ordinance No. 3608" recorded August 7, 2003 as Recording No. 20030807000823 of Official Records. 10. Easement, including terms and provisions contained therein* Recording Information, January 6, 2005 under Recording No. 20050106000575 In Favor of: Puget Sound Energy,Inc,a Washington corporation For: One or more electric utility systems Affects: Parcel 1 as described therein 11. Sidewalk easement as contained and/or delineated on the face of the LLA No. LL-2005- 37 recorded January 10, 2006, Recorders No. 20060110002592,in King County, Washington. (Affects Parcel No. 2) j PRO FORMA First Amerlran Title Insurance cornpary PRO F O R F AVQQ . ;0�:�,�, ALTA Owner's Policy(6-17-06) Policy Num6r.VS-502043-WAi j i k � 1 i i i i Ftrst Amerlren 7ltle Insurance company A� CERTIFICATE OF LIABILITY INSURANCE DATE(MMDDYYYY) 4/10/2012 10/3/2011 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER,AND THE CERTIFICATE HOLDER. IMPORTANT If the certificate holder is an ADDITIONAL INSURED,the pollcylies)must be endorsed If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy,certain policies may require an endorsement A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsements) PRODUCER Lockton Companies,LLC Denver CONTACT AAME 8110E Union Avenue PHONE I FAX Exit. A C No Suite 700 E-MAIL Denver80237 ADDRESS (303)414-6000 INSURERS AFFORDING COVERAGE NAIC% INSURER A Travelers Property Casualty Co of America 25674 INSURED American Management Services,LLC INSURER B 1067565 dba Pinnacle INSURER 2801 Alaskan Way,Suite 310 INSURER D Seattle,WA 98121 INSURER E INSURER F COVERAGES QS CERTIFICATE NUMBER: 11467559 REVISION NUMBER XXXXXXX THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS INSR rypE OF INSURANCE AD SUBR POLICY EFF POLICY EXP LIMITS LTR INSR WVD POLICYNUMBER MMIDD MWDD/YVYY GENERAL LIABILITY NOT APPLICABLE EACH OCCURRENCE S xxxxxxx DAMAGE TO RENTED MMERCIAL GENERAL.LIp.BILITY PREMISES(Ea occurrence) $ xxxx}sxx CLAIMS-MADE UOCCUR MED EXP(Any one erson PERSONAL 8 ADV INJURY $ xxxxxxx GENERAL AGGREGATE $ xxxxxxx GEN'L AGGREGATE LIMIT APPLIES PER PRODUCTS-COMPfOP AGG $ XXXXXXX POLICY F7 jE 7 71 LOC $ p AUTOMOBILE LIABILITY N N Y-810-1707L917-TIL-11 4/10/2011 4/10/2012 (Eaacadent) $ 1,000,000 x ANY AUTO BODILY INJURY(Per person) $ XXXXXXX ALL OWNED SCHEDULED AUTOS AUTOS BODILY INJURY Per accident NON-OWNED PROPERTY DAMAGE X HIREDAUTOS X AUTOS $ XXXXXXX sXXXXXXX UMBRELLA UAB OCCUR NOT APPLICABLE EACH OCCURRENCE $ X'XJ{J{xxx EXCESS LIAB CLAIMS-MADE AGGREGATE $ XXXXXXX DED RETENTION$ 1$ xkAA xxx WORKERS COMPENSATION NOT APPLICABLE We S ATU- OTH- AND EMPLOYERS'LIABILITY YIN TORY LIMIT ER ANY OFFICERIMEMBEER�EXCLUD D' IVE ECUT ❑ NIA EL EACH ACCIDENT $ xxxxxxx (Mandatory in NH) E L DISEASE-EA EMPLOYEE $ XXXXXXX If yes describe under DESCRIPTION OF OPERATIONS below E L DISEASE-POLICY LIMIT $ XXX DESCRIPTION OF OPERATIONS I LOCATIONS f VEHICLES (Atfach ACORD 101,Additional Remarks Schedule,if more space is required) Re Kent Town Center-Land-430 Smith Street Kent,WA 98032 Hired and non owned coverage applies to vehicles driven by employees of AMS&Pinnacle Named insured includes Goodman Real Estate Effective 9602011 CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS 11467559 AUTHORIZED REPRESENTATIVE Goodman Real Estate Brad Reisinger 2801 Alaskan Way Seattle WA 98121 ll C 1 Q/IC rv/ ACORD 25(2010105) The ACORD name and logo are registered marks of ACORD ©1 88-2010 ACORD CORPURATION All rights reserved t A� CERTIFICATE OF LIABILITY INSURANCE DATE3/2011/Yn 1z/312o11 10/3/2011 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER,AND THE CERTIFICATE HOLDER IMPORTANT If the certificate holder Is an ADDITIONAL INSURED,the pollcy(Ies)must be endorsed If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy,certain policies may require an endorsement A statement on this certificate does not confer rights to the certificate holder In lieu of such endorsement(s). PRODUCER Lockton Companies,LLC Denver CNAME ONTACT X ExtiCFAAX8110E Union Avenue PHONE C No Suite 700 E-MAIL Denver80237 ADDRESS (303)414-6000 INSURERS AFFORDING COVERAGE NAIC If INSURER A Liberty ante Corporation 42404 INSURED American Management Services,LLC INSURER B 1312937 dba Pinnacle INSURER c 2801 Alaskan Way,Suite 310 INSURER D Seattle,WA 98121 INSURER E INSURER F COVERAGES QS CERTIFICATE NUMBER: 11467551 REVISION NUMBER: XXXXXXX THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED NOTWITHSTANDING ANY REQUIREMENT,TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS INSREnt TYPE OF INS VRANCE IN SR ADDIL SVi D POLICY NUMBER MMIDDY/YYYY MWDDrrM LIMITS GENERAL LIABILITY NOT APPLICABLE EACH DAMAGE TO RENTED MMERCIAL GENERA 1LI Y PREMISES(Ea occurrence) $ }{){�{�{xxx CL4IMSMADE OCCUR MED EXP(Any oneperson) $ PERSONAL&ADV INJURY $ XXXXXXX GENERAL AGGREGATE $ xxxxxxx GEN'L AGGREGATE LIMIT APPLIES PER PRODUCTS-COMP/OP AGG $ XXXXXXX PROJECT POLICY PRO- LOC $ F OMOBILE LIABILITY NOT APPLICABLE (Ea accident) $ xxxxxxx ANY AUTO BODILY INJURY(Per person) $ X X ALL OWNED SCHEDULED BODILY INJURY[Per accident AUTOS AUTOS NON-OWNED PROPERTY DAMAGE $ XXXXXXX HIRED AUTOS AUTOS a XXXXXXX UMBRELLA LWB OCCUR NOT APPLICABLE EACH OCCURRENCE It XXXXXXX EXCESS LIAB CLAIMS-MADE AGGREGATE $ xxxxxxx DED RETENTIONS I$ xxxxxxx A WORKERS COMPENSATION YIN N WA766DW4188050 12/31,12010 12/31/2011 X ORY L M T OER AND EMPLOYERS'LIABILITY AY OPFICEF MEIM ER EXCLUDED ECUTIVE � NIA E L EACH ACCIDENT $ 1,000,000 (Mandatory in NH) E L DISEASE-EA EMPLOYE $ 1,000,000 Byes describe under DESCRIPTION OF OPERATIONS below E L DISEASE-POLICY LIMIT $ DESCRIPTION OF OPERATIONS I LOCATIONS I VEHICLES (Adach ACORD 101,Additional Remarks Schedule,if more space rs required) Re Kent Town Center-Land-430 Smith Street Kent,WA 98032 Coverage pertains to employees of AMS&Pinnacle only Named insured includes Goodman Real Estate Effective 9/30/2011 CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS 11467551 AUTHORIZED REPRESENTATIVE Goodman Real Estate Brad Reisinger 2801 Alaskan Way Seattle WA 98121 Carc t..l ACORD 25(2010/05) The ACORD name and logo are registered marks of ACORD c 88-2010 ACORD CORP ATION All rights reserved A� CERTIFICATE OF LIABILITY INSURANCE , DATE(MM/DDYYYY) 4i 10/2012 10/3/2011 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES ` BELOW THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER,AND THE CERTIFICATE HOLDER IMPORTANT If the certificate holder is an ADDITIONAL INSURED,the policy(ies)must be endorsed If SUBROGATION IS WAIVED,subject to the terms and conditions of the policy,certain policies may require an endorsement A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s) PRODUCER Lockton Companies,LLC Denver CNAME ONTACT 81 10 E Union Avenue PHONE AJCANo,Exth IX No Suite 700 E-MAIL Denver80237 ADDRESS i (303)414-6000 INSURERS AFFORDING COVERAGE NAIL INSURER Scottsdale Insurance Company 41297 INSURED American Management Services,LLC INSURER B 2 2 1 1045565 dba Pinnacle INSURER C Liberty Mutual Fire Insurance Com an 23035 2801 Alaskan Way,Suite 310 INSURER D Seattle,WA 98121 INSURER E INSURER F COVERAGES QS CERTIFICATE NUMBER: 11467563 REVISION NUMBER: XXXXXXX THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED NOTWITHSTANDING ANY REQUIREMENT,TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS INSR TYPE OF INSURANCE ADD SUBR POLICY EFF POLICY EXP LIMITS LTR I R III POLICY NUMBER MM/DD/YYYY MMMD A GENERAL LIABILITY N N RBS0002791 4/10/2011 4r10/2012 EACH OCCURRENCE , DAMAGE TO RENTED X QVIAMERCIAL GENE ABILITY PREMISES(Ea occurrence) S 100,000 CLAIMS-MADE OCCUR MED EXP(Any one rson) $ X Per Location Agg PERSONAL&ADV INJURY $ 1,000,000 $2,000 000 GENERAL AGGREGATE $ 2.001000 GEN'L AGGREGATE LIMIT APPLIES PER PRODUCTS-COMP/OP AGG $ 2.000000 POLICY D PRO- JECT X LOC $ AUTOMOBILE LIABILITY NOT APPLICABLE COMBINED SINGLE LIMI I (Ea accident) $ XXXXXXX # ANY AUTO BODILY INJURY(Per person) $ XXXXXXX ALLTOS UTOS OWNED ASCHEDULED AU BODILY INJURY Per accident $ XXXXXXXHIRED AUTOS NON-OWNED PROPERTY DAMAGE AUTOS $ XXXXXXX $ XXXXXXX C X , UMBRELLA LIAB X OCCUR N N TH7661004188081 4/10/2011 4/10/2012 EACH OCCURRENCE $ 25,000,000 EXCESS LIAB CLAIMS-MADE AGGREGATE $ 25000000 OED I I RETENTION$ $ XXXXXXX WORKERS COMPENSATION NOT APPLICABLE W S A U- H- AND EMPLOYERS'LIABILITY Y/N TORY LIMIT ER ANY PROPRIETORRARTNER/EXECUTIVE E L EACH ACCIDENT $ OFFICER/MEMBER EXCLUDED? N/A XXXXXXX (Mandatory m NH) E L DISEASE-EA EMPLOYE $ XXXXXXX If yes,describe under DESCRIPTION OF OPERATIONS below EL DISEASE-POLICY LIMIT $ XX XXXX B Excess Umbrella N N 798129,14 4/10/2011 4/10/2012 Limit $50 OW 000 per occurrence& aggregate DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES (Attach ACORD 101,Additional Remarks Schedule,if more space is reque,d) Mold coverage is excluded TRIA coverage is included Re Kent Town Center-Vacant Land-430 Smith Street Kent,WA 98032 Named insured includes Goodman Real Estate City of Kent Is included man additional insured with respect to general habilty as required by written contract Per the terms and conditions of the policy Coverage effective 9/30/2011 CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN , ACCORDANCE WITH THE POLICY PROVISIONS 11467563 AUTHORIZED REPRESENTATIVE Goodman Real Estate Brad Reisinger 2801 Alaskan Way Seattle WA 98121 C 1 ACORD 25(2010/05) The ACORD name and logo are registered marks ofACORD ©1 88-2010 ACORD CORP611ATION All rights reserved Client#: 139621 RHINDEMO ACORD,. CERTIFICATE OF LIABILITY INSURANCE DAYS91302011,^ ^Y) THIS CERTI=ICATE IS ISSJED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS LIcON THE CERTIFICATE HOLDER.THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEN:).EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW.THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S),AUTHORIZED REPRESENTATIVE OR PRODUCER,AND THE CERTIFICATE HOLDER, IMPORTANT' If the certlflcete holder is an ADDITIONAL INSURED ine pot,cy(Ies)must be er,,dDrsed If SUBROGATION IS WAIVED,sub)ect to the terms and conditions of the policy,certain policies may require air endorsement A statement on this certificate does not confer rights to the certificate holder in lieu of such endorssment;sl Vanessa PRODUCER 'NAMCAC GDhen Propel Insurance a°NNn E¢I 800 499-D933 �Ic,No 866 577-1 326 Tacoma Commercial Insurance �',Dort`ss 1201 Pacific Ave, Suite 1000 INSURER(s AFFORDING COVERAGE kA c f Tacoma,WA 98402 INSURER Zurich-American Insurance Compa 16535 INSURED INSURER B Navigators Insurance Company Rhine Demolition, LLC INSURER C Travelers Indemnity Company of l9D46 1124 East 112th NsuREa D Crum&Forster Specialty Insura Tacoma,WA 9B445 INSURER SeaBright Insurance Company INSURER F COVERAGES CERTIFICATE NUMBER. REVISION NUMBER. THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUEC TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED NOTWITHSTANDING ANY REOUIREMENT, TERM OR COND TION OF ANY CONTRACT DR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT 70 ALL THE TERMS, EXCLUSIONS AND COND,TIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS 1NSR, TYPE OF INSURANCE ADDLISUBR POLICY NUMBER f PMIMWTYYY,EFF MMOD,'1�' LIMI—$ LTR INSR INN I A GENERALUABILITY X GL0369729408 11110112011 0310112012 EACH DccuRRENcE Is1,O00000 XI COMMERCIAL GENERAL LIABILITY Inc[WA Stop Gap "0 11rTIED s 300 DOO CLA;IAS•MADE X OCCUR IVIED EXF(Any one persoi) $I O DOO X BIIPDDed.5,DDO PERSONAL$ADVINJURY sI,DD0,000 CENERALAGGREGATE s2,00,000 GEN'LAGGREGATE LIM"APPLIES PER PRODUCTS COMPIOFAGG $2 ODD DOD POLICY X PLO• LOC S A AUTOMOBILE LIABILITY BAP369729508 310112D1 1 1 0 310112 01 2I c l OMBwEDSINGLEulnr 1,DDD,000 f�a amdent X ANY AUTO I BODILY INJURY IPer oerson) 5 ALL OWNED SCHEDULED BODILY INJURY(Far s=denl) S X HIRED ALFTOSAUTOS X NON-OWNED PROPERTY DAMAGE $ AUTOS fPer a^-idenL AUTOS B U MBRELLA LIAB X OCCUR SEIIEXC7254771V 3ID1,2011 03/011201 EACH OCCURRENCE s1000000 XCESS LIABED RET'c NTIDNS $ C WORKERS COMPENSATION 6K11BD759N41011 6/0112011 0610112012 X w IRY OH AND EMPLOYERS'LIABILITY ANY PROPRIETORPARNEXECLrrVE YIN N TEM WC-Oregon E L EACH ACCIDEh- $1 000 000 OFFICERIMEMBER EXCLUDED? NIA (Mandatory In NH) E L DISE4SE-EA EMPLOYEE s1 DDO ODD If yw,dawbe under DESCRIPTION OF OPERATIONS below E L DISEASE-POLICY LIMIT $1 OOD DDO E USL&H BB3110081 1101111 01/01112 $1,000,DDD D Pollution/Profess PKCIDDODI 310112DIl 03101l2012 $5,000,000 Occ/Agg ,Asbestos Abatemnt $25,0D0 Deductible DESCRIPTION OF OPERATIONS I LOCATIONS I VEHICLES(Attach ACORD 1111,Additional Remarks Schedule,N more space is reou,red) RE: Kent Parking Garage Demolition City of Kent, Goodman Real Estate, and Venture General Contracting, LLC are additional insureds per the attached endorsements. CERTIFICATE HOLDER CANCELLATION Goodman Real Estate SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN 2B01 Alaskan Way A310 ACCORDANCE WITH THE POLICY PROVISIONS Seattle,WA 98121 AUTHORIZED REPRESENTATIVE 019BB-2010 ACORD CORPORATION,All rights reserved ACORD 25(2010ID5) 1 of I The ACORD name and logo are registered marks of ACORD t #S75742SIM728487 VT00 Certificate of Insurance Effective immediately, Propel Insurance will no longer issue certificates of insurance not handed in accordance with statutory laws We will only issue the most cu rent edition of the ACORDOR certificates of insurance In addition, the only information allowed to be entered in the Description of Operations area of the ACORD®certificates of insurance are the description of operations, the locations and/or vehicles covered by the in-force policy. The issuance or modification of a certificate of insurance that in any way misrepresents any material term, condition, coverage or other provision as set forth in the policy, or deliberately or falsely amends or alters the insurance policy or assists in such issuance or modification violates the state law and subjects the violator to civil and criminal penalties s, Please note a certificate of insurance is simply a summary of the designated insurance policy and does not !cannot modify or amend the referenced insurance policy or confer any right upon the certificate holder In additior, the certificate holder is owed no duty to be notified in the event the insurance policy is cancelled. For purposes of this notice. 'certificate' or "certificate of insurance" means any ACORD® certificate of insurance, which is prepared or issued by an insurer or insurance agent as evidence of property or casualty insurance coverage but does not include an actual copy of the insurance policy or insurance binder, Please contact your state department of insurance for further explanation or inquiries. Additional Insured —Automatic — Owners, Lessees Or ZURICH= 4 Contractors i i c04--y No Eff. Dote Of PDI Sp Date of PDf I Et; Date of End D-od.rcer ND Add'( Prem Return Pram GL:3Ee72�D8 �D31�1;2D'9 �03�0'J2072 jG3��';2D" 4 C THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. Named Insured Rhine Demolition,LLC Address (including ZIP Code): 1124 Fast1l2th Tacoma,WA 4B445 This endorsement modmes insurance provided under the: Commercial General Liability Coverage Part A. Section 11—Who Is An Insured is amended to include as an insured any person or organization who you are required to add as an additional Insured on this policy under a written contract or written agreement B. The insurance provided to the additional insured person or organization applies only tD "bodily injury", 'broperty damage' or 'personal and advertising Injury" covered under Section I - Coverage A - Bodily Injury And Property Damage Liability and Section I - Coverage B -Personal And Advertising Injury Liability, but only with respect to liabillry for"bodily injury", "property damage" or"personal and advertising injury" caused, in whole or in pa-1 ty. 1. Your acts or omissions, or 2. Tne acts or ommsions of those acting on your behalf, and resulting directly from your ongoing operations or"your work" as included in the "products-completed operations hazard", which is the subject of the written contract or written agreement, performed for the additional insured person or organization C. However, regardless of the provisions of Paragraphs A. and B. above: 1. We will not extend any Insurance coverage to any additional insured person or orgarization: a. That is not provided to you in this policy, or b. That is any broader coverage than you are required to provide to the additional insured person or organization in the wn:ten contract or written agreement, and 2. We will not provide Limits of Insurance to any additional insured person or organization that exceed the lower or a. The Limits of Insurance provided to you in this policy; or b. The Limits of Insurance you are required to provide in the written contractor written agreement. D. The insurance provided to the additional insured person or organization does not apply to. "Bodily injury", "property damage" or"personal and advertising injury' arising out of the rendering or failure to render any professional architectural, engineering or surveying services including- 1. The preparing, approving or failing to prepare or approve maps, shop drawings, opinions, reports, surveys, field orders, change orders or drawings and specifications; and Z. Supervisory, inspection, architectural or engineering activities. u-GL-1176-C cw 0711 o Page 1 or 2 includes copyrighted material of Insurance services Office,Inc.,with its permission. E. The eddibonal insu-ed must sea to f that 1. We are noj led as soon as pracri ole of im"occurrence" or offense that may result in a claim; 2- We receive written notice of a Claim or"suit"as s7on as practicable_; and 3. A request for defense and indemnry of the claim or "suit" will prcmptiy be brought against any policy issued by another irsurer under which the additional insured may be a-i insured in any capacity This provision does not apply to insurance_ on which the additional insured is a Named Insured, r the written contract or writ en agreement requires mat this coverage be arimary and no-,-contributory. F. Fo-the coverage provided by this endorsement 1. —'he following oaragraph is added to Paragraph 4.a. of the Other Insurance Condition of Section IV—Commercial General Liability Conditions This insurance is primary insurance as respects our coverage to the additional insured person or organization, i where the written contract or written agreement requires that this insurance be primary and nnn-contributory with respect to any other policy uppn which the additional insured is a Named Insured. in that event, we will not seek contribution from any other such insurance policy available to the additional insured on which the additional insured person or organization is a Named Insured. 2. The following paragraph is added to Paragraph 4.b.of the Othe-Insurance Condition of Section IV—Commercial General Liability Conditions- This insurance is excess over. Any of the other insurance, whether primary, excess, contingent or on any other basis, available to an additional insured, in which the additional insured en our policy is also covered as an additional insured on another policy providing coverage for the same"occurrence", offense, claim or"suit". This provision does not apply to any policy in which the additional insured is a Named Insured on suc:n other policy and where our policy is required by written contract or written agreement to provide coverage to the additional insured on a primary and non- contributory basis. G. This endorsement does not apply to an additional insured which has been added to this policy by an endorsement showing the additional insured in a Schedule of additional insureds, and which endorsement applies specifically to that identified addibonal insured All ocher terms and conditions of this policy remain unchanged. U-GL-1175-C OW(D711D) Pa_oe 2 of 2 Inciudes copyrighted matenal of Insurance Seruian Offic-.Inc.,with Its permission. f _ Client# 139621 RHINDEMO ACORDTM CERTIFICATE OF LIABILITY INSURANCE D TE 9 13012/DD/YYYY) r3or2o 11 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND.EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S),AUTHORIZED REPRESENTATIVE OR PRODUCER,AND THE CERTIFICATE HOLDER IMPORTANT If the Certificate holder is an ADDITIONAL INSURED,the pollcy(les)must be endorsed If SUBROGATION IS WAIVED,subject to the terms and conditions of the policy,certain policies may require an endorsement A statement on this certificate does not confer rights to the certificate holder In lieu of such endorsement(s) CON PRODUCER NAMEA Vanessa Cohen Propel Insurance ac"No Ex[ 800 499-0933 AXc,No 866 577-1326 Tacoma Commercial Insurance E-MAILw ADDRESS 1201 Pacific Ave, Suite 1000 INSURER(S)AFFORDING COVERAGE NAIL p Tacoma,WA 98402 INSURER Zunch•Amencan Insurance Compa 16535 INSURED I INSURER Navigators Insurance Company Rhine Demolition, LLC INSURER Travelers Indemnity Company of 19046 1124 East 112th INSURER D Crum&Forster Specialty Insura Tacoma,WA 99445 i SeaBr ht Insurance Company INSURER E g P y INSURER F COVERAGES CERTIFICATE NUMBER: REVISION NUMBER THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CON-RACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXC_USIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS INSR TYPE OF INSURANCE ADDL SUBR POLICY EFF POLICY EXP LIMITS LTR INSR POLICY NUMBER MMMDRYYY MWDD'YYYY A GENERAL LIABILITY X GL0369729408 0310112011 03/01/2012 EACH OCCURRENCE 51,000,000 T RENTE X COMMERCIAL GENERALLIABILIT' Inc]WA Stop Gap REMAMAI SC EaoccunD enceJ, 5300000 CLAIMS-MADE 1 X OCCUR MED EXP(Any one person) S10,000 X BI/PDDed.5,0o0 PERSONAL B ACV INJURY $1,000,000 GENERAL AGGREGATE 52,000,000 GENL AGGREGATE LIMIT APPLIES PER PRODUCTS COMP/OP AGG $2,000,000 POLICY J( PRO- LOC $ A AUTOMOBILE LIABILITY BAP369729508 3/01/2011 03/0112012 COMBINED INGLE LIMIT CO aBINED S 1,000,000 X ANY AUTO BDDILY INJURY(Per person) $ ALL OWNED F7 SCHEDULED BODILYINJURY(Perawdent) $ 'AUTO_ ALTOS X HIREDAUTOS X NDN-OWNED PROPERTYDAMAGE $ ALTOS Per accident) B UMBRELLA LIAR J( OCCUR SEIIEXC7251771V 3/0112011 03/01/2012 EACH OCCURRENCE $10000000 X EXCESS LIAB CLAIMS-MADE AGGREGATE $1 O 000 000 DED 1 11 RETENTIONS $ C WORKERS COMPENSATION 6KUB0759N41011 6/01/2011 06/01/201 )( WeSTATU. OTH- AND EMPLOYERS'LIABILITY ANY PROPRIETOR/PARTNER/EXECUTME YIN WC•Oregon E L EACH ACCIDENT $1,000,000 OFFICERIMEMBER EXCLUDED'+ N i A (Mandatory in NH) EL DISEASE-EA EIAPLOYEE $1 DOD 000 If yss,describe under DESCRIPTION OF OPERATIONS bebw EL DISEASE-POLICY LIMIT 151,000,000 E USL&H BB3110081 1101/11 01/01112 $1,000,000 D Pollution/Profess PKC100001 3/01/2011 03/01/2012 $5,000,000 Occ/Agg Asbestos Abatemnt $25,000 Deductible DESCRIPTION OF OPERATIONS/LOCATIONS I VEHICLES(Attach ACORD 101 Additional Remarks Schedule,if more space is required) RE.Kent Parking Garage Demolition City of Kent, Goodman Real Estate, and Venture General Contracting, LLC are additional insureds per the attached endorsements. CERTIFICATE HOLDER CANCELLATION Goodman Real Estate SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN 2801 Alaskan Way#310 ACCORDANCE WITH THE POLICY PROVISIONS Seattle,WA 98121 AUTHORIZED REPRESENTATIVE f A *ci 01988-2010 ACORD CORPORATION All rights reserved ACORD 25(2010/05) 1 of 1 The ACORD name and logo are registered marks of ACORD #S757429/M728487 VTOO Certificate of Insurance Effective immediately, Propel Insurance will no longer issue certificates of insurance not handled in accordance with statutory laws We will only issue the most current edition of the ACORD®certificates of insurance In addition, the only information allowed to be entered in the Description of Operations area of the ACORDO certificates of insurance are the description of operations, the locations andlor vehicles covered by 1 the in-force policy The issuance or modification of a certificate of insurance that in any way misrepresents any material term, condition, coverage or other provision as set forth in the policy, or deliberately or falsely amends or alters the insurance policy or assists in such issuance or modification violates the state law and subjects the violator to civil and criminal penalties Please note a certificate of insurance is simply a summary of the designated insurance policy and does not /cannot modify or amend the referenced insurance policy or confer any right upon the certificate holder In addition, the certificate holder is owed no duty to be notified in the event the insurance policy is cancelled. For purposes of this notice, "certificate" or "certificate of insurance" means any ACORD& certificate of insurance, which is prepared or issued by an insurer or insurance agent as evidence of property or casualty insurance coverage but does not include an actual copy of the insurance policy or insurance binder Please contact your state department of insurance for further explanation or inquiries Additional Insured —Automatic — Owners, Lessees Or ZURICHT Contractors Pokcy No Eff Date of Pol Exp Date of Pol I Eff Date of End Producer No Add'].Prem Return Pram. e GLO369729408 03/01,2011 C310 1 12 0 1 2 D37I T011 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY, Named Insured. Rhme Demolition,LLc Address (including ZIP Code): 1124 East 112th Tacoma,WA 98445 This endorsement modifies insurance provided under the: Commercial General Liability Coverage Part A. Section It—Who Is An Insured is amended to include as an insured any person or organization who you are required to add as an additional insured on this policy under a written contract or written agreement B. The Insurance provided to the additional insured person or organization applies only to "bodily injury", "property damage" or "personal and advertising Injury" covered under Section I - Coverage A - Bodily Injury And Property Damage Liability and Section I -Coverage B -Personal And Advertising Injury Liability, but only with respect to liability for"bodily injury", "property damage"or"personal and advertising injury"caused, in whole or In part, by. 1. Your acts or omissions, or 2. The acts or omissions of those acting on your behalf, and resulting directly from your ongoing operations or"your work" as included in the"products-completed operations hazard", which is the subject of the written contract or written agreement performed for the additional insured person or organization. C. However, regardless of the provisions of Paragraphs A. and B.above. 1. We will not extend any insurance coverage to any additional insured person or organization. a. That is not provided to you in this policy, or b. That is any broader coverage than you are required to provide to the additional insured person or organization in the written contract or written agreement; and 2. We will not provide Limits of Insurance to any additional insured person or organization that exceed the lower of: a. The Limits of Insurance provided to you in this policy;or b. The Limits of Insurance you are required to provide in the written contractor written agreement. D. The insurance provided to the additional insured person or organization does not apply to. "Bodily injury", "property damage" or"personal and advertising injury" arising out of the rendering or failure to render any professional architectural, engineering or surveying services including 1. The preparing, approving or failing to prepare or approve maps, shop drawings, opinions, reports, surveys, field orders, change orders or drawings and specfications; and 2. Supervisory, inspection, architectural or engineering activities. U-GL-1175-C cW(07110) Page 1 of 2 Includes copyrighted material of Insurance Services Office,Inc.,with Its permission. E. The additional insured must see to it that 1. We are notified as soon as practicable of an"occurrence"or offense that may result in a claim; 2. We receive written notice of a claim or"suit'as soon as practicable; and 3. A request for defense and indemnity of the claim or"suit' will promptly be brought against any policy issued by another insurer under which the additional insured may be an insured in any capacity This provision does not apply to insurance on which the additional insured is a Named Insured, if the written contract or written agreement requires that this coverage be primary and non-contributory F. For the coverage provided by this endorsement 1. The following paragraph is added to Paragraph 4.a.of the Other Insurance Condition of Section IV—Commercial General Liability Conditions: This insurance is primary insurance as respects our coverage to the additional insured person or organization, where the written contract or written agreement requires that this insurance be primary and non-contributory with respect to any other policy upon which the additional insured Is a Named Insured. in that event, we will not seek contribution from any other such insurance policy available to the additional insured on which the additional insured person or organization is a Named Insured. 2. The following paragraph is added to Paragraph 4.b.of the Other Insurance Condition of Section IV—Commercial General Liability Conditions, This insurance is excess over. Any of the other insurance, whether primary, excess, contingent or on any other basis, available to an additional insured, in which the additional insured on our policy is also covered as an additional insured on another policy providing coverage for the same"occurrence", offense, claim or"suit'. This provision does not apply to any policy in which the additional insured is a Named Insured on such other policy and where our policy is required by written contract or written agreement to provide coverage to the additional insured an a primary and non- contributory basis. G. This endorsement does not apply to an additional insured which has been added to this policy by an endorsement showing the additional insured in a Schedule of additional insureds, and which endorsement applies specifically to that identified additional insured. All other terms and conditions of this policy remain unchanged. II U-GL-1 175-C CW 07h(i t ) Page 2 of 2 Includes copyrighted material of insurance Services Office,Inc.,with its permission. A��® DATE(MM/DD/YYYY) � CERTIFICATE OF LIABILITY INSURANCE4/10/2012 10/3/2011 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER,AND THE CERTIFICATE HOLDER IMPORTANT. If the certificate holder is an ADDITIONAL INSURED,the policy(iss)must be endorsed If SUBROGATION IS WAIVED,sublect to the terms and conditions of the policy,certain policies may require an endorsement A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsements PRODUCER LOckton Companies,LLC Denver CONTACT 8110E Union Avenue PHONE JPAK AIC No Suite 700 E-MAIL Denver80237 ADDRESS (303)414-6000 INSURERS AFFORDING COVERAGE NAIL iI INSURER Scottsdale Insurance Com anv 41297 INSURED American Management Services LLC INSURER B 20281 1045565 dba Pinnacle INSURER C Liberty Mutual Fire Insurance Company 23035 2801 Alaskan Way.Suite 310 INSURER D Seattle,WA 98121 INSURER E INSURER F COVERAGES QS CERTIFICATE NUMBER 11467563 REVISION NUMBER XXXXXXX THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED NOTWITHSTANDING ANY REQUIREMENT TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS INSR TYPE OF INSURANCE ADD SUER POLICY EFF POLICY EXP LIMITS LTR IN SIR WVD POLICYNUMBER MMlDDIYYYY MMIDDrYYYY A GENERAL LIABILITY N N RBS0002791 410/2011 4/10!2012 EACH O^ R N^E, $ L000.00O DAMAGE TO RENTED MMERCIAL GENERgL,LIpBIUTY PREMISES(Ea occurrence) $ 100 000 CLAIMS-MADE OCCUR MED EXc(An ore ersoni s ]uded X Per Location Agg PERSONAL&ADb'INJ'JRY S 1.000,000 $2,000,000 GENERAL AGGREGATE : 2.000,000 GEN L AGGREGATE LIMIT APPLIES PER PRODUC-S-COMPIOP AGG $ 200 .000 POLICY PE T X I HOC $ AUTOMOBILE LIABILITY NOT APPLICABLE CO(Ea acadenq 1—XXXXXXX ANY AUTO BODILY INJURY(Per person) $ XXXXXXX ALL Ov"NED SCHEDULED BODILY INJURY/Per accident' S XXXXXXX AUTOS ASU70S HIRED AUTOS NON OWNED PROPERTY DAMAGEAUT $ XXXXXXX S XXXXXXX C I UMBRELLA LIAB }( OCCUR N N TH7661004189081 4/10/2011 4/10r2012 EACHOCCURRENCE $ 25.000,000 EXCESS LIAB CLAIMS-MADE AGGREGATE $ 25,000,000 I—TIDED RETENTION$ $ XXXXXXX WORKERS COMPENSATION NOT APPLICABLE P H AND EMPLOYERS'LUIBILITY YIN TORY LIMIT ER ANY OFFICEOPRI BEREXCLUDRIE ECUTIVE Li NIA EL EACH ACCIDENT $ XXXXXXX (Mandatory In NH) E L DISEASE,EA EMPLGYEE s XXXXXXX If yes,describe under DESCRIPTION OF OPERATiONS below E L DISEASE-POLICY LIMIT I s XXXXXXX B Excess Umbrella N N 71111164 4/10/2011 4/10�2012 Limit $50,000,000 per occurrence& aggregate DESCRIPTION OF OPERATIONS I LOCATIONS I VEHICLES (Attach ACORD 101,Additional Remarks Schedule,if more space Is required) Mold coverage is excluded TRIA coverage is included Re Kent Town Center-Vacant Land-430 Smith Street Kent WA 98032 Named insured includes Goodman Real Estate City of Kent is included as an additional insured with respect to general liabilty as required by written contract per the terms and conditions of the policy Coverage effective 9/30/2011 CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS 11467563 AUTHORIZED REPRESENTATIVE Goodman Real Estate Brad Reisinger 2801 Alaskan Way Seattle WA 98121 r L jJ ACORD 25(2010105) The ACORD name and logo am registered marks a ACORD c1 88-2010 ACORD CORPCRATION All rights reserved POLICY NUMBER RBS 0 0 0 2 7 91 COMMERCIAL GENERAL LIABILITY CIS 20 26 07 04 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED - DESIGNATED PERSON OR ORGANIZATION This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART SCHEDULE Name Of Additional Insured Persons Or Organization(s) ANY PERSON OR ORGANIZATION WHEN YOU AND SUCH PERSON OR ORGANIZATION HAVE AGREED IN WRITING IN A CONTRACT OR AGREEMENT, EXECUTED PRIOR TO THE "OCCURRENCE" TO WHICH THIS INSURANCE APPLIES, THAT SUCH PERSON OR ORGANIZATION BE ADDED AS AN ADDITIONAL INSURED ON YOUR POLICY INCLUDING: SUNAMERICA HOUSING FUND #1013; SUNAMERICA HOUSING FUND #1014; SUNAMERICA HOUSING FUND #1071; SUNAMERICA HOUSING FUND #1126; SUNAMERICA HOUSING FUND *1582; AIG RETIREMENT SERVICES, INC. ; SUNAMERICA AFFORDABLE HOUSING PARTNERS, INC. Information required to complete this Schedule if not shown above,will be shown in the Declarations. Section II —Who Is An Insured is amended to include as an additional insured the person(s) or organiza- tion(s) shown In the Schedule, but only with respect to liability for 'bodily injury", "property damage" or "personal and advertising injury" caused, In whole or in part, by your acts or omissions or the acts or omis- sions of those acting on your behalf. A In the performance of your ongoing operations, or B. In connection with your premises owned by or ; rented to you r i Y CG 20 26 07 04 0 ISO Properties, Inc., 2004 Page 1 of 1 0 Inured Copy REQUEST FOR MAYOR'S SIGNATURE ��• T Please Fill in All Applicable Boxes WI. .,.4f UM Routing Information (ALL REQUESTS MUST FIRST BE ROUTED THROUGH THE LAW DEPARTMENT) Originator: Tom Brubaker Phone (Originator): 5786 Date Sent: 09/30/11 Date Required: 09/30 11 Return Signed Document to: Kim Komoto CONTRACT TERMINATION DATE: N/A VENDOR NAME: Goodman Real Estate DATE OF COUNCIL APPROVAL: 9/20/11 Brief Explanation of Document: Goodman Real Estate Lease for Kent City Center. All Contracts Must Be Routed Through The Law Department REC"' (This area to be completed by the Law Department) Received: �D Approval of LawEDeptt..:2Ql14)j1x,- 1�� Law De��4AW- ®EPr Date Forwarded to Mayor: Z'61 / I 1 Shaded Areas To Be Completed By Administration Staff Received: 1 Recommendations and Comments: Disposition: 1 Date Returned: