HomeMy WebLinkAboutCAG2001-0557 - Original - King County - Borden Chemical Loan Agreement - 02/09/2001 LOAN AGREEMENT
TH LOAN AGREEMENT (this "Agreement"), dated for reference purposes
February 41J, , 2001, is entered into by and between CITY OF KENT, a Washington municipal
corporation, hereinafter called "Borrower," and KING COUNTY, a Washington municipal
corporation,hereinafter called"Lender."
RECITALS
This Agreement is entered into upon the basis of the following facts and circumstances:
A. With the use of the Loan proceeds described below, Borrower intends to purchase
that certain parcel of property known as Borden Chemical Plant located at 421-608 1st Avenue
North, Kent, Washington (the "Property'). Thereafter it is anticipated that a private developer(the
"Private Developer") will be selected through a request for proposal procedure to develop the
Property as an urban town center, mixed-use development which shall include office, retail,
entertainment space, multi-family housing, parking and public space. It is anticipated that the
acquisition will result in the creation of jobs where at least 51% of the jobs, computed on a full time
equivalent basis, involve the employment of low- or moderate-income persons, all as more fully
described in Exhibit"A" attached hereto and made a part hereof(hereinafter called the"Project").
B. The Economic Development Program of the Office of Regional Policy and Planning
of Lender is responsible within King County for the receipt and disbursement of Community
Development Block Grant monies made available to Lender by the United States Department of
Housing and Development (hereinafter called "HUD"), pursuant to the Housing and Community
Development Act of 1974, as amended, and the federal regulations promulgated thereunder
(hereinafter collectively called the"Act"). Lender seeks to maximize the use of such monies consis-
tent with both Lender's and block grant program objectives.
C. The acquisition of the Property and the subsequent development of the Project by a
private developer will result in the increase of a minimum of 258 new full time equivalent jobs
which will provide public benefits and qualify for Community Development Block Grant monies
under 24 CFR § 570.203. Lender has agreed to lend Community Development Block Grant monies
to Borrower(the "Loan")to assist its acquisition of the Project.
D. The Loan from Lender to Borrower will have no negative effect on any projects
approved in Lender's Community Development Block Grant programs.
E. The Loan shall be evidenced by this Agreement and by Borrower's Promissory Note
("Note") in the form attached hereto as Exhibit "B" and secured by an unconditional, irrevocable
Direct Pay Letter of Credit, payable upon demand ("Direct Pay Letter of Credit") in the form
attached hereto as Exhibit "C" (The Note and this Agreement are collectively referred to herein as
the "Loan Documents"). It is the intent of the parties that Lender will draw against the Direct Pay
Letter of Credit to repay the indebtedness owed under the Note.
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F. Lender is willing to make the Loan to Borrower for the purposes hereinabove set
forth,all upon the terms and conditions herein set forth.
G. Lender makes no commitment to future support and assumes no obligation for future
support of the activities contracted for herein, except as expressly set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing Recitals and the covenants
and conditions,representations and warranties contained herein,the parties hereto agree as follows:
ARTICLE I
THE LOAN
1.1 The Loan. In reliance upon Borrower's representations and warranties, and subject
to the terms and conditions herein and in the Loan Documents, Lender hereby agrees to loan
Borrower a sum of money not to exceed NINE MILLION AND N0/100 DOLLARS
($9,000,000.00) for the purposes set forth herein, which funds shall be received by Lender from
HUD and from no other source (the "Loan"). Borrower shall have the right to receive Loan funds
from Lender only pursuant to the terms and conditions of this Agreement and in accordance with
the Act,and then only to the extent Community Development Block Grant funds are made available
to Lender by HUD. Should anticipated sources of revenue become unavailable to Lender for use in
the Economic Development Program, Lender shall immediately notify Borrower in writing and
Lender will be released from all contracted liability for that portion of the Agreement covered by
funds not yet received by Lender.
1.2 Acquisition Financing Only. The Loan is only to provide financing used by
Borrower for the acquisition of the Project. The Promissory Note evidencing the Loan is to be paid
off on or before its maturity date from such sources as may be necessary to pay the Loan in full,
including,without limitation, from the Direct Pay Letter of Credit.
1.3 Loan Documentation and Security. The Loan will be evidenced by this Agreement
and by the Note. The Loan will be secured by the Direct Pay Letter of Credit.
ARTICLE II
BORROWER'S REPRESENTATIONS AND WARRANTIES
In order to induce Lender to make the Loan, Borrower represents and warrants as follows,
which representations and warranties shall be true and correct as of the execution hereof and shall
survive the execution and delivery of this Agreement,the Note and the Direct Pay Letter of Credit:
2.1 Organization of Borrower: Authority to Enter into Agreement. Borrower is a
municipal corporation, duly formed and validly in existence pursuant to the laws of the State of
Washington and authorized to transact business in the State of Washington. Borrower has the right
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and power to own the Project and Borrower has full power and authority to enter into this
Agreement,to borrow money as contemplated herein and to execute and carry out the provisions of
the Loan Documents. The execution, delivery and performance of this Agreement and the Loan
Documents have been duly authorized by all necessary corporate action, and no other action of
Borrower is required for the execution, delivery and performance of this Agreement or the Loan
Documents. This Agreement and the Note constitute or, if not yet executed or delivered,will when
so executed and delivered constitute, valid and binding obligations of Borrower, each enforceable in
accordance with their respective terms.
2.2 Nondiscrimination.
A. During the performance of this Loan Agreement, Borrower shall not
discriminate on the basis of race, color, sex,religion,national origin, creed,marital status, age or the
presence of any sensory,mental or physical handicap in employment or application for employment
or in the administration or delivery of services or any other benefits under this Loan Agreement.
Borrower shall comply fully with all applicable federal, state and local laws, ordinances, executive
orders and regulations which prohibit discrimination. These laws include, but are not limited to,
Chapter 49.60 of the Revised Code of Washington, and Titles VI and VII of the Civil Rights Act of
1964.
B. If Borrower fails to comply with King County Ordinance 4528, as amended,
such failure shall be deemed a violation of the Ordinance and a material breach of this Loan
Agreement. Such breach shall be grounds for cancellation, termination or suspension of this Loan
Agreement, in whole or in part, and shall be grounds for Lender to demand full repayment of the
Loan.
2.3 No Liti ag_tion. There are no actions, suits or proceedings pending, or to the
knowledge of Borrower threatened against or affecting it or the Project in any court at law or in
equity, or before or by any governmental or municipal authority which might adversely affect the
ability of Borrower to perform its obligations hereunder or under any of the Loan Documents to
which Borrower is a party.
2.4 Covenants.Zonins and Codes. Borrower will comply with all applicable
environmental statutes and regulations to be complied with in connection with its ownership of the
Project. To Borrower's knowledge, all permits, consents, approvals or authorizations by, or
registrations, declarations, withholding of objections or filings with any governmental body
necessary in connection with the valid execution, delivery and performance of this Agreement, or
presently necessary for the ownership and operation of the Project, have been obtained, are valid,
adequate and in full force and effect or will be obtained prior to the commencement of any activities
for which a permit, consent, approval or authorization is necessary. To Borrower's knowledge,
operation of the Project will in all respects conform to and comply with all applicable zoning,
environmental protection,use and building codes,laws,regulations and ordinances.
2.5 ARproval of Project. The description of the Project set forth in Exhibit "A" hereto is
a general description of the Project. The description of the Project is satisfactory to Borrower and
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has been approved by Borrower and, to Borrower's knowledge, the Project has been or will be
approved as required by all governmental bodies or agencies having jurisdiction.
2.6 Compliance With Documents. As of the date hereof and for so long as the Loan
Documents remain in effect, Borrower is and will remain in full compliance with all of the terms
and conditions of this Agreement, the Loan Documents, and no event of default has or shall have
occurred and be continuing which, with the lapse of time or the giving of notice, or both, would
constitute such an event of default under the foregoing.
2.7 Incorooration of Representations and Warranties. The request by the Borrower for
any advance of Loan proceeds under this Agreement shall constitute a certification by the Borrower
that the aforesaid representations and warranties are true and correct as of the date of such request.
ARTICLE III
CONDITIONS PRECEDENT TO LOAN CLOSING
Lender's obligation to enter into and perform its duties under this Agreement shall be subject
to the full and complete satisfaction of the following conditions precedent:
3.1 Documents. Lender shall have received and approved fully executed originals of
each of the following documents which shall have been duly authorized, executed (and, where
appropriate, acknowledged), and delivered by the parties thereto: this Agreement, the Promissory
Note, the Direct Pay Letter of Credit, and any and all other documents as Lender may deem
reasonably necessary with respect to the Loan.
3.2 Evidence of Authority. Lender shall have received evidence satisfactory to it that
Borrower and the persons signing on behalf of Borrower have the capacity and authority to execute
and deliver Loan Documents on behalf of Borrower.
3.3 Insurance.
(a) Borrower shall carry and maintain general public liability insurance against
claims for bodily injury, personal injury, death or property damage occurring or arising out of the
ownership and/or operation of the Project, which insurance shall cover such claims as may be
occasioned by any act, omission, or negligence of the Borrower or its officers, agents,
representatives, assigns or servants relating to the Project. The limits of liability insurance, which
shall be increased from time to time as deemed necessary by Lender, with the approval of Borrower
which shall not be unreasonably withheld, shall not be less than One Million Dollars ($1,000,000)
combined single limit personal injury and property damage insurance. The insurance required
above shall be issued by an insurance company or companies authorized to do business within the
State of Washington and must be acceptable to Lender. Lender shall be specifically named as an
additional insured on all such policies, and all such policy or policies shall be primary to any other
valid and collectible insurance.
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(b) Certificate or certificates or other evidence satisfactory to Lender evidencing
the existence and terms and conditions of all insurance required above shall be delivered to Lender
prior to the initial advance of Loan funds. The policy or policies of insurance required to be
maintained in accordance with this Agreement shall not be canceled or given notice of non-renewal
nor shall the terms or conditions thereof be altered or amended without thirty (30) days' written
notice being given to Lender.
ARTICLE IV
CONDITIONS PRECEDENT TO LOAN ADVANCE
Lender's obligation to make the initial advance of Loan funds pursuant to the terns
hereof shall, in addition to compliance with the terms of Article III hereof, be subject to receipt of
the following documents and satisfaction of the following conditions precedent:
(a) Receipt by Lender of any other documents and assurances as it may
reasonably request which are required by HUD or any federal, state or county regulatory agency
which requests Lender to provide such documents or assurances.
(b) Lender shall have received and have in its possession sufficient Community
Development Block Grant funds to fund the draw request of Borrower.
(c) Receipt by Lender of a written acknowledgment from the issuer of the Direct
Pay Letter of Credit adjusting the amount of the Direct Pay Letter of Credit upward by an amount
sufficient to cover the disbursement, plus two month's interest which will accrue on said
disbursement.
ARTICLE V
BORROWER'S LOAN COVENANTS
Borrower covenants and agrees as follows:
5.1 General. From and after the date hereof and so long as any amount remains unpaid
on the Promissory Note, or for so long as any commitment exists to extend credit hereunder,
Borrower covenants and agrees that it will:
(a) Promptly pay principal and interest pursuant to the Note as and when the
same becomes due and payable;
(b) Preserve and keep in full force and effect its existence as a municipal
corporation and its ownership of the Project; and
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(c) Obtain and maintain the insurance required herein.
5.2 Change to Project. So long as any portion of the Loan proceeds remains unpaid,
there shall be no material change of the Project without the prior written approval of Lender and,
to the extent that such approvals may be required, the appropriate governmental authorities.
5.3 Compliance with Laws. Borrower's use of the proceeds of the Loan shall comply
with all applicable laws, ordinances, rules and regulations and executive orders of federal, state,
county or municipal governments or agencies now in force or which may be enacted hereafter.
5.4 Call Provision. In addition to, and not in any way to be deemed any limitation upon,
Lender's right to demand repayment of the Loan at any time, Lender may call the Loan immediately
due and payable if at any time during the term of the Loan without Lender's prior written approval:
(a) Borrower sells, transfers or assigns all or substantially all of the Project,
whether voluntarily or involuntarily,or by the operation of law; or
(b) There occurs any default under the terms of the Promissory Note, this Loan
Agreement or any of the Loan Documents which is not remedied in full within any applicable
curative period provided herein or therein.
Upon the occurrence of any of the foregoing, Lender may declare an Event of
Default hereunder and exercise its rights and remedies pursuant to Article VI.
5.5 Ins ecn tions. Lender and its representatives shall have the right at all reasonable
times during regular business hours (and at any time in the event of an emergency) to inspect the
Project to determine that the same is in conformity with the Agreement and all laws, ordinances,
rules and regulations applicable to Borrower's use of the Loan funds. Lender shall have the further
right, from time to time and upon reasonable notice to Borrower, to inspect Borrower's books and
records relating to Borrower's use of the Loan funds. Without limiting the foregoing, Borrower
shall permit Lender to examine and copy all books, records and other papers relating to Borrower's
use of the Loan funds to insure Borrower's compliance with the Act and applicable provisions of 24
CFR Part 570.
5.6 Notify Lender of Litigation or Complaints. Borrower shall promptly notify Lender
in writing of all litigation or possible litigation affecting Borrower or any part of the Project which
might materially and adversely affect Borrower's performance of its obligations under the Note or
the Loan Documents, and of all complaints or charges made by any governmental authority
affecting the Project or Borrower which may require changes in the Project.
5.7 Indemnify Lender. Borrower shall indemnify and hold Lender, its elected and
appointed officials and any employees thereof, harmless from all liability for any actual or alleged
damage or injury of whatsoever nature arising out of or in any way connected with the Project or
arising out of Borrower's breach of the provisions of this Agreement, including the cost of defense
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thereof using counsel approved by Lender. Lender may commence, appear in or defend any action
or proceeding purporting to affect the rights, duties or liabilities of the parties hereto or the Project,
and Borrower shall pay all of the Lender's costs and expenses incurred thereby on demand. This
section shall survive execution, delivery and performance of this Agreement, the Note and the Loan
Documents.
5.8 Further Assistance. Borrower will at any time and from time to time upon request of
Lender take or cause to be taken any action, execute, acknowledge, deliver or record any further
documents, opinions, or other instruments or obtain such additional insurance as Lender is required
to do or obtain by HUD or other federal, state or county regulatory agency.
5.9 Use of CDBG Funds.
(a) To the greatest extent feasible,Borrower shall purchase supplies and services
for activities under this Agreement from vendors and contractors whose businesses are located in
King County and served by Community Development Block Grant funded activities or owned in
substantial part by project area residents. (See Section 3, Housing and Urban Development Act of
1968,as amended).
(b) Funds loaned to Borrower hereunder shall not be used directly or indirectly
to employ, award contracts to, or otherwise engage the services of, or fund any contractor or
subrecipient during any period of debarment, suspension, or placement in ineligibility status under
the provisions of 24 CFR Part 24.
5.10 Procurement Standards
(a) If Borrower is a"for profit"borrower,it shall comply with Federal Executive
Orders 11625, 12432 and 12138, 24 CFR Part 85.36(e). If Borrower is a "nonprofit" borrower, it
shall comply with OMB Circular No. A-110,Attachment O,Paragraph g.Failure of the Borrower to
comply with any of the applicable requirements set forth within the foregoing regulations shall be a
breach of this Agreement.
(b) In advertising for employees, goods or services for the activities under this
Agreement, "for profit" borrowers shall comply with 24 CFR Part 85.36(e) and "non profit"
borrowers shall comply with Attachment 0 to OMB Circular 110, Procurement Standards,
paragraph 9, Contracting with Small and Minority Firms, Women's Business Enterprise and Labor
Surplus Area firms. Borrower shall be considered to be in compliance with this provision if at least
one of the following steps is taken: (1) advertise in a minority publication in addition to publication
of general circulation; (2) utilize a minority contractors bidding center; (c)utilize the King County
Affirmative Action Office Certified Minority/Women's Business Enterprise Directory and King
County Plan Centers.
(c) In awarding contracts pursuant to this Agreement, Borrower shall comply
with all applicable requirements of local and state law for awarding contracts, including, but not
limited to, procedures for competitive bidding, contractor's bonds, and retained percentages (RCW
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60.28.010). In addition, "for profit" borrowers shall comply with the requirements of 24 CFR Part
85.36(h) Bonding Requirements, and "non profit" borrowers shall comply with the U. S. Office of
Management and Budget Circular A-102,relating to bonding, insurance and procurement standards,
and with Executive Order 11246 regarding nondiscrimination in bid conditions for projects over
$10,000.00.
5.11 Intentionally Deleted.
5.12 Administrative Requirements. Borrower shall comply with the policies, guidelines
and requirements of 24 CFR Part 85.20, Standards for Financial Management.
5.13 Job Creation Monitoring and Documentation. Lender is loaning $9,000,000 to
Borrower for the Project. This money has been granted to Lender by the United States
Department of Housing and Urban Development through its Community Development Block
Grant (CDBG) program. Therefore, Borrower's activity must comply with CDBG regulations.
Lender has qualified this activity under the national objective criterion for job creation and
retention. This requires that (1) at least 5 1% of the permanent, full-time equivalent jobs created
be held by persons from low and moderate income households, defined by HUD as households
with annual incomes less than 80% of the area median, and (2) a minimum of 258 total
permanent, full-time equivalent jobs be created.
Borrower, Private Developer, any subsequent owners of the Project and tenants within the
Project ("Tenants") are responsible for compliance with the above national objective criterion.
To this end:
(a) Borrower, Private Developer, any subsequent owners of the Project shall
require that all Tenants complete a King County Job Creation Summary Form
attached hereto as Exhibit "D" and by this reference incorporated herein and
require each new permanent employee hired as a result of this Project to
complete the King County Employee Income Verification Form attached
hereto as Exhibit"E" and by this reference incorporated herein.
(b) Borrower shall set forth the requirements of the national objective criterion
that at least 5 1% of the permanent, full-time equivalent jobs to be created by
the Project be held by persons from low and moderate income households and
that a minimum of 258 total permanent, full-time equivalent jobs be created
by the Project, as well as Exhibits "D" and "E", in its Request for Proposals
(RFP) to sell, lease or transfer the Property. Borrower shall submit draft
language to Lender for approval prior to issuing an RFP.
(c) Borrower shall include these national objective criterion requirements and
Exhibits "D" and "B" in the deed transferring the Property to the Private
Developer as covenants running with the Property in favor of Lender.
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(d) The Private Developer and any subsequent owner of the Project shall include
Exhibits "D"and"B", and the requirement to complete said forms, in all leases with
individual Tenants.
5.14 Repartment of Subsidy. Borrower shall repay to Lender the interest rate subsidy
(defined as the difference between Lender's loan interest rate and the Borrower's normal cost of
borrowing funds at the closing of the Loan, less the loan fee and cost of the Letter of Credit) if any of
the following occurs:
(a) Borrower fails to sell, lease or transfer the Property to a Private Developer
within 60 months of the date of the Note.
(b) The Private Developer fails to (1) secure financing, (2) obtain all necessary
construction permits, and (3) commence construction of the Project within 66
months of the date of the Note.
(c) Borrower fails to provide documentation (as stated above) to the Lender that a
minimum of 258 total permanent full time equivalent jobs were created and that
5 1% of the permanent full time equivalent jobs were held by persons from low
and moderate income households within 96 months of the date of the Note.
5.15 Compliance with Endangered Species Act. The United States Department of Housing
and Urban Development (HUD), through its Community Development Block Grant (CDBG) program,
has granted this Loan to Lender. Consequently, pursuant to 16 U.S.C. §1536 of the Endangered
Species Act (ESA), HUD must insure that any action it funds is not likely to jeopardize the continued
existence of any endangered or threatened species or result in the destruction or adverse modification
of any endangered or threatened species' critical habitat. Lender has been informed that species listed
as threatened pursuant to the ESA occur in the general area of the Property. Borrower has disclosed to
Lender that it intends to demolish the existing buildings on the Property prior to repayment of the
Loan. In order to analyze any possible effects the demolition activities might have on listed species,
Borrower must prepare a Biological Assessment that will analyze whether the demolition activities
might have an effect on listed species. After the Borrower has prepared the Biological Assessment,
Borrower and Lender will consult with the Services on this Project. Section 7(d) of the ESA prohibits
the commitment of irreversible or irretrievable resources by the Borrower or Lender until the Section 7
consultation process has been concluded. Therefore, Borrower, its agents and/or the seller of the
Property may not engage in any demolition, grading, clearing, or construction activities on the
Property prior to the completion of the Section 7 consultation. If Borrower, its agents and/or the seller
of the Property engage in any demolition, grading, clearing or construction activities on the Property
prior to the completion of the Section 7 consultation, Lender will demand immediate repayment of the
Loan, including any interest that is due.
5.16 Compliance with the National Historic Preservation Act. If at any time during the
construction phase, any contractors for the Project encounter archaeological materials, Borrower
covenants and warrants to Lender that a professional archaeologist will be called immediately to
evaluate the materials and develop a mitigation plan if appropriate. This covenant shall also be
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included in the RFP and the deed transferring the Property to the Private Developer as a covenant
running with the land.
5.17 Retention of Records. Records required in connection with this Agreement shall be
retained for a period of the later of three (3) years after termination of this Agreement or five (5)
years from the date of initial disbursement of Loan funds, except that records that are the subject of
audit findings shall be retained until such findings have been resolved.
ARTICLE VI
DEFAULT AND REMEDIES
6.1 Event of Default. The occurrence of any of the following events shall constitute an
Event of Default hereunder:
(a) Any default by Borrower in the repayment of any indebtedness owing to
Lender for any purpose or reason,which indebtedness is not paid when due.
(b) Any breach by Borrower of any of the non-monetary covenants and
conditions of this Agreement, which breach is not cured to Lender's satisfaction within ten (10)
working days from the occurrence thereof,provided, that in the event of a non-monetary breach or
default by Borrower which is outside of the control of Borrower and which cannot be cured within
said ten (10) working days, Borrower shall have commenced to cure its breach or default within
said ten(10)working days and thereafter diligently proceeds to cure its breach or default. Notwith-
standing anything to the contrary contained herein, any breach or default by Borrower of any
applicable laws,ordinances,rules,regulations or executive orders applicable to Lender,Borrower or
Borrower's use of the Loan funds shall immediately constitute an Event of Default hereunder.
(c) Any representation, warranty or disclosure made to Lender by Borrower
proves to be materially false or misleading as of the date when made, whether or not such
representation or disclosure appears in this Agreement.
(d) Any material deviation in the operation of the Project without the approval
of Lender which deviation is not corrected or substantially corrected within ten (10) working days
after receipt of written notice thereof from Lender to Borrower.
(e) A petition in bankruptcy or for reorganization or for an arrangement under
any bankruptcy or insolvency law or for a receiver or trustee for any of Borrower's property is filed
by or against Borrower which is not dismissed within forty-five (45) days, or if Borrower makes an
assignment for the benefit of creditors or becomes insolvent or unable to pay its debts as they
mature or any attachment or execution is levied against a substantial portion of the property of
Borrower and is not discharged within forty-five(45)days.
(f) There occurs any event which in Lender's reasonable judgment materially
adversely affects (i)the ability of Borrower to perform any of its obligations hereunder or under any
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of the Loan Documents, including, without limitation, the occurrence of any event of dissolution or
termination of Borrower; (ii) the business or financial condition of Borrower; (iii) the operations or
value of the Project; or(iv)compliance with the Act.
(g) A petition in bankruptcy or for reorganization or for an arrangement under
any bankruptcy or insolvency law is filed by or against Borrower within ninety-one (91) days after
Borrower has repaid the Loan in full. In such an event, Lender shall have the absolute right to draw
upon the Direct Pay Letter of Credit to the extent of any payments made within ninety-one (91)
days of filing a petition in bankruptcy or for reorganization or any arrangement under any
bankruptcy or insolvency law, regardless of the fact that Borrower has previously paid the Loan in
full, provided that within a reasonable time thereafter Lender shall pay over to the trustee or
bankruptcy estate the funds previously paid to Lender by Borrower to the extent that the Direct Pay
Letter of Credit is drawn upon under this subparagraph. Notwithstanding the foregoing,in the event
Borrower has repaid the Loan in full from funds received from a third party, institutional lender,
then Lender shall immediately return the Direct Pay Letter of Credit to the issuer thereof.
6.2 Remedies. Upon the occurrence of an Event of Default, Lender may, in addition to
any other remedies which Lender may have hereunder or under the Loan Documents or by law, at
its option and without prior demand or notice take any or all of the following actions:
(a) Immediately terminate any further advance of Loan funds hereunder.
(b) Declare the Note immediately due and payable and commence collection
proceedings against the Direct Pay Letter of Credit.
All remedies of Lender provided for herein and in any other Loan Document are
cumulative and shall be in addition to all other rights and remedies provided by law. The exercise
of any right or remedy by Lender hereunder shall not in any way constitute a cure or waiver of
default hereunder or under any other Loan Document or invalidate any act done pursuant to any
notice of default, or prejudice Lender in the exercise of any of its rights hereunder or under any
other Loan Documents unless, in the exercise of said rights, Lender realizes all amounts owed to it
under such Loan Documents.
ARTICLE VII
MISCELLANEOUS
7.1 No Waiver. No waiver of any default or breach by Borrower hereunder shall be
implied from any failure by Lender to take action on account of such default if such default persists
or is repeated, and no express waiver shall affect any default other than the default specified in the
waiver and shall be operative only for the time and to the extent therein stated. Waivers of any
covenant, term or condition contained herein shall not be construed as a waiver of any subsequent
breach of the same covenant, term or condition. The consent or approval by Lender to, or of, any
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act by Borrower requiring further consent or approval shall not be deemed to waive or render
unnecessary the consent or approval to,or of, any subsequent similar act.
7.2 Successors and Assigns. This Agreement is made and entered into for the sole
protection and benefit of Lender and Borrower,their successors and assigns, and no other person or
persons shall have any right of action hereunder. The terms hereof shall inure to the benefit of the
successors and assigns of the parties hereto; provided, however, that the Borrower's interest
hereunder cannot be assigned or otherwise transferred without the prior consent of Lender.
7.3 Notices. Any notice, demand or request required hereunder shall be given in writing
at the addresses set forth below by personal service or registered or certified, first class mail, return
receipt requested. The addresses may be changed by notice to the other party given in the same
manner as provided above. If notice is given by mail, it shall be deemed received on the earlier of.
(i)receipt as shown on the return receipt,or(ii)three(3)days after its deposit in the U.S. mail.
If to Borrower: City of Kent
220 4ch Avenue South
Kent, Washington 98032-5895
Attn: 4,4 a
If to Lender: Office of Regional Policy and Planning
King County
King County Courthouse
516 Third Avenue, Room 402
Seattle, Washington 98104
Attn: Manager,
Economic Development Program
7.4 Time. Time is of the essence hereof.
7.5 Amendments. No amendment,modification, or termination of any provisions of this
Agreement or of any of the Loan Documents shall in any event be effective unless the same shall be
in writing and signed by Lender and Borrower.
7.6 Headings. The article and section headings in no way define, limit, extend or
interpret the scope of this Agreement or of any particular article or section.
7.7 Number and Gender. When the context in which the words are used in this
Agreement indicate that such is the intent, words in the singular number shall include the plural and
vice-versa. References to any one gender shall also include the other gender if applicable under the
circumstances.
7.8 Validi . In the event that any provision of this Agreement shall be held to be
invalid, the same shall not affect in any respect whatsoever the validity of the remainder of this
Agreement.
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7.9 Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Washington and the County of King, except to the extent federal law
applies.
7.10 Survival of Warranties. All agreements, representations and warranties made herein
shall survive the execution and delivery of this Agreement and of the Loan Documents and the
making of the Loan hereunder and continue in full force and effect until the obligations of Borrower
hereunder and the indebtedness evidenced by the Promissory Note have been fully paid and
satisfied.
7.11 Venue and Forum. In the event that any legal action should be filed by either party
against the other, the venue and forum for such action shall be the Superior Court of the State of
Washington for the County of King.
7.12 Attorneys'Fees. In the event either party shall bring an action to enforce the terms
and conditions of this Agreement,the prevailing party shall be entitled to recover all of its costs and
expenses, including,but not limited to,reasonable attorneys'fees as determined by the court.
7.13 Conflict of Interest. No member, official or employee of Lender shall have any
personal interest, direct or indirect, in the subject matter of this Agreement, nor shall any such
member, official or employee participate in any decision relating to this Agreement which affects
his personal interests or the interests of any corporation, partnership or association in which he is
interested,whether directly or indirectly.
7.14 Duplicate Originals. This Agreement shall be executed in duplicate and each of the
parties hereto shall receive an original,provided,that each original shall constitute one and the same
agreement.
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IN WITNESS WHEREOF, Borrower and Lender have executed this Agreement as of the
date first written above by and through their duly authorized representatives.
LENDER BORROWER
KING COUNTY, a Washington CITY OF KENT,
municipal corporation a Washington municipal corporation
By: x,, f.e By:
Ro Sims,
King County Executive
Approved as to form: Attest:
Norm Maleng, King County
Prosecuting Attorney
By: 1 `
Deputy Pr secuting Attorney
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STATE OF WASHINGTON )
ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that the persons appearing
before me and making this acknowledgment are the persons whose true signatures appear on this
document.
0 .
4101n this �-42�-- day , 2WO, before me personally appeared
and , to me known to be the
and , respectively, of THE CITY
OF KENT,44he municipal corporation that executed the within and foregoing instrument, and
acknowledged the said instrument to be the free and voluntary act and deed of said municipal
corporation, for the uses and purposes therein mentioned, and on oath stated that they were
authorized to execute said instrument and that the seal affixed, if any, is the corporate seal of said
municipal corporation.
WITNESS my hand and official seal hereto affixed the day and year first above
written.
No#ry PubVind forthe State of Washington,
y � +�; residing at; � My commiires~:�
` c [Type or Print Notary Name]
WAS%
(Use This Space for Notanal Seal Stamp)
15
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EXHIBIT"A"
Description of Project
Kent Urban Town Center Acquisition&Development Project
The City of Kent has completed a Commuter Rail Area Study. The Borden Chemical property is
the largest parcel addressed in the study. The study and the City of Kent view the site as
underutilized land and providing the City with the opportunity to create an urban town center
mixed use development. The City's vision is for a mixture of uses ranging as follows:
Office: 55,000 to 75,000 sq. feet
Retail: 80,000 to 125,000 sq. feet
Entertainment: 50,000 plus sq. feet
Multifamily: 230 units(depending on configuration and size)
Parking: 650-800 spaces
Based upon the above estimates, it is projected the project will create, at a minimum, 258 new
jobs.
This type of development will create a new synergy in downtown Kent. The mixed-use
development on the Borden Chemical property will be a compliment to the current historic
downtown. The mix of retail will expand the market for downtown and meet some of the unmet
shopping needs of people who live, work and ride commuter rail in the town center. South of the
property is the planned location of the Kent Civic and Performing Arts Center and a 680 stall
parking garage. The garage is a shared facility and these two facilities will be part of the whole
mixed-use development.
The planned redevelopment of the Borden Chemical property will provide for some public space.
The proposed concept could include a fountain or an entertainment Plaza. The plaza with many
other design elements is envisioned to tie the new development to the older historic downtown
area.
The City of Kent anticipates using approximately up to $9 million in CDIL funds to acquire the
Borden property. The balance of the purchase price ($12,078,300)will come from other sources.
The proceeds from the CDIL loan will be used for acquisition only. It is projected that a private
developer will be selected, through a RFP process, to purchase the property from the City of
Kent and develop the mixed use concept. It is expected that this selection process will take 18 to
24 months. Proceeds from the sale of the property to the private developer will be used to retire
the CDIL loan.
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To meet the national objective of CDBG regulations as defined in Section 570.208(a)(4)
benefiting low- and moderate-income families through job creation, fifty-one percent (51%) or
132 jobs will be held by low- or moderate income persons.
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EXHIBIT`B"
Promissory Note
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