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HomeMy WebLinkAboutITEM V-C-5C[TY OF * • ~ AGENDA BILL APPROVAL FORM U RN ~ WASHINGTON Agenda Subject: Date: Purchase of Safewa Pro ert ortion of)l A ril 27, 2009 Department: Attachments: Budget Impact: Human Resources Purchase and Sale Agreement $209,088.00 Bar ain and Sale Deed Administrative Recommendation: City Council authorize the Mayor and City Clerk to execute a Purchase and Sale Agreement for the purchase of a portion of the Safeway Property. Background Summary: The City desires to purchase a certain portion of the Safeway Property an.d develop certain improvements on the Parcel. S0504-1 Reviewed by Council & Committees: Reviewed by Departments & Divisions: ❑ Arts Commission COUNCIL COMMITTEES: ❑ Building ❑ M&O ❑ Airport 0 Finance ❑ Cemetery ❑ Mayor ❑ Hearing Examiner ❑ Municipal Serv. ❑ Finance ❑ Parks ❑ Human Services ❑ Planning & CD ❑ Fire ❑ Planning ❑ Park Board ❑Public Works 0 Legal ❑ Police ❑ Planning Comm. ❑ Other ❑ Public Works ~ Human Resources ❑ Information Services Action: Committee Approval: ❑Yes ❑No Council Approval: ❑Yes ❑No Call for Public Hearing Referred to Until Tabled Until Councilmember: Backus Staff: Heineman Meetin Date: Ma 4, 2009 Item Number: V.C.S AU$LjRN * MOKE THAN YOU IMAGINED PURCHASE AND SALE AGREEMENT This PURCHASE AND SALE AGREEMENT (this "Agreement") is entered into as of the day of , 2009, by and between the CITY OF AUBURN, a Washington municipal corporation, as Purchaser (hereinafter the "CITY"), and SAFEWAY, INC., a Delaware corporation (hereinafter the "SELLER"). RECITALS A. The SELLER is the owner of certain real property and all improvements thereon ("the Safeway Property") located in the City of Auburn, County of King, Washington, which is legally described on Exhibit A attached hereto. B. CITY desires to purchase a certain portion of the Safeway Property (the "Parcel") from SELLER and develop certain improvements on the Parcel, which is legally described on Exhibit B attached hereto. C. SELLER desires to sell the Parcel to CITY, on the terms and conditions set forth herein. AGREEMENT NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby mutually acknowledged, SELLER and CITY hereby agree as follows: 1. Certain Defined Terms. For purposes of this Agreement, the terms set forth below shall have the meaning assigned to them: 1.1 "Closing" or "Close of Escrow" means the recordation of the Deed in the Official Records and SELLER's receipt of the Purchase Price. 1.2 "Closing Date" means any mutually agreeable date on or before June 30, 2009 but in no event shall the date be sooner than ten (10) business days following the end of the due diligence period. 1.3 "Deed" means a statutory warranty deed. 1.4 "Escrow" means the escrow opened with Escrow Agent for the consummation of the transaction described in this Agreement. 1.5 "Bscrow Agent" means Chicago Title Insurance Company (Phone: (253) 945- 9140). 1.6 "Official Records" means the official real property records of King County, Washington. 1.7 "Opening of Escrow" means the date a fully executed copy of this Agreement is deposited with Escrow Agent. 1.8 "Permits" has the meaning as set forth in Section 9.1 below. 1.9 "Purchase Price" has the meaning as set forth in Section 3. 1.10 "Exhibit C Location Map" means the map provided by City of Auburn showing the area City of Auburn desires to purchase, which is attached hereto as Exhibit C. 1.11 Title Company" means Chicago Title Company. 1.12 "Title Policy" means an ALTA (1970 Form B) extended coverage owner's policy of title insurance issued by the Title Company to CITY with coverage in the amount of purchase price, showing title to the Parcel vested in CITY subject only to the Permitted Exceptions. 2. Purchase and Sale. The SELLER agrees to sell to CITY, and CITY agrees to purchase from SELLER, the Parcel upon the terms and conditions set forth in this Agreement. . 3. Purchase Price; Cash Payment. The total cash purchase price for the Parcel (the "Purchase Price") shall be Two Hundred Nine Thousand Eighty-eight Dollars and No/100's ($209,088.00). The Purchase Price shall be paid to SELLER in cash at Closing. The above purchase price includes the CITY'S full contribution toward the SELLER'S maintenance and upkeep obligations under the Drainage Agreement entered into.between the SELLER and the Boeing Company ("Boeing" dated September 18, 2002, which is attached hereto as Exhibit D. 4. Covenants, Conditions, Restrictions and Drainage Agreement. a. SELLER is obligated pursuant to the Drainage Agreement, which is attached hereto as Exhibit D, and pursuant to Covenants, Conditions, Easements and Restrictions (CCERs"), entered into between SELLER and Boeing dated September 18, 2002, which is attached hereto as Exhibit E, to assist with the maintenance and upkeep of various drainage easements. No further contributions or obligations for maintenance and upkeep of the drainage easements shall fall upon the CITY in connection with the obligations of the Drainage Agreement or CCERs PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY PurcSale Agreement.doc Page 2 b. In connection herewith, the SELLER agrees to indemnify, defend, and hold harmless, the CITY, its officers, employees, agents, attorneys, and assigns from and against any and all obligations to perform, actions, causes of action, liabilities, claims, suits, penalties, fines, judgments, liens, awards and damages of any kind whatsoever, for injury to or death of any person (including without limitation claims brought by (a) the general public, (b) employees, licensees or invitees of the parties, or damage to or loss of any property or clean up of any discharge or release by anyone, and expenses, costs of litigation, and reasonable attorneys' fees related thereto, or incident to establishing the right to indemnification,) arising out of or in any way related to the obligations of the CCERs and Drainage Agreement, to the full extent permitted by law. SELLER agrees that the obligations under this Section 4.b shall survive after the closing date. c. SELLER may reserve an easement for emergency access across the Parcel, said easement to be in a form acceptable to the City. 5. Earnest Money Deposit. On execution of this Agreement, CITY shall deposit with Escrow Agent One Thousand Dollars and No/100's Dollars t$1,000.00~) in cash (the "Deposit"), which shall be held by Escrow Agent as an earnest money deposit hereunder. The Deposit shall be held in Escrow and applied or disposed of by Escrow Agent as provided herein. Escrow Agent shall place the Deposit in an interest-bearing account approved by CITY and SELLER and all interest earned thereon shall be added to and become a part of the Deposit. 6 Due Diligence. 6.1 Due Diligence Period. CITY shall have the right for a period of sixty (60) days from the date of this Agreement (the "Due Diligence Period") to conduct CITY's due diligence review, examination and inspection of all matters pertaining to its acquisition of the Parcel, including such inspections, tests, and surveys as CITY deems appropriate to determine the suitability of the Parcel for CITY's intended use. SELLER shall provide CITY and CITY's agents and consultants with reasonable access to the Parcel and, to the extent such information is in the possession or control of SELLER, shall provide reasonable access to appropriate information respecting the Parcel, subject to the terms and conditions of this Agreement. CITY's obligation to purchase the Parcel shall be contingent upon its approval of such property after conducting its due diligence review. If, based upon CITY's review, examination and inspection, CITY shall determine in its sole discretion that it intends to acquire the Parcel, then CITY shall promptly notify SELLER of such determination in writing prior to the expiration of the Due Diligence Period, whereupon CITY's due diligence contingency shall be deemed satisfied and waived, the Deposit shall become nonrefundable (except as otherwise provided herein), and CITY shall proceed to Closing. In the event that CITY shall fail to have delivered such notice to SELLER on or before the expiration of the Due Diligence Period, then this Agreement shall automatically terminate, the Deposit shall be returned to CITY, and CITY's rights under this Agreement shall be of no further force or effect. PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 3 6.2 Delivery of Due Diligence Items. Within five (5) business days after the date of this Agreement, SELLER shall make available to CITY for 'its review, the following items: 6.2.1 Tax Statements. Copies of the real estate tax statements for the Parcel for the past two (2) years; 6.2.2 Other pocuments. All other documents in SELLER's possession or control relating to the SELLER's ownership of the Parcel and any improvements thereon, including surveys, planning and zoning documents and approvals, environmental and water and soils reports and tests and evidence confirming the location and capacity of all utilities and utility easements. 6.3 Title Commitment. Promptly after mutual execution of this Agreement, CITY shall obtain an extended preliminary title insurance commitment covering the Parcel from the Title Company (the "Commitment"), together with copies of all recorded documents listed as special exceptions therein. Approval by CITY of the exceptions to title set forth in the Commitment (other than as hereinafter set forth) shall be a condition precedent to CITY's obligation to purchase the Parcel. Unless CITY gives written notice that it disapproves the exceptions to title shown on the Commitment (other than the exceptions to title approved by CITY and described in Section 5.4 below), stating the exceptions so disapproved, within thirty (30) days after the date of this Agreement, CITY shall be deemed to have approved such exceptions. If CITY disapproves any title exceptions, SELLER shall have a ten (10) day period after its receipt of CITY's written notice of disapproval of the same within which to provide written notice to CITY as to which of such disapproved title exceptions the SELLER will remove (or cause to be removed) from title; provided, however, that SELLER shall not be required to actually remove such exception(s) until Closing. If, for any reason, SELLER's notice given pursuant to the immediately preceding sentence does not covenant to remove all of CITY's disapproved title exceptions at or prior to Closing, CITY shall have the right to terminate this Agreement by written notice to SELLER and Escrow Agent given within ten (10) days after the earlier of the expiration of such ten (10) day period or the date SELLER informs CITY that it does not intend to remove the disapproved items (the "Termination Notice"). CITY's failure to deliver the Termination Notice within such ten (10) day period shall be deemed CITY's approval of any such previously disapproved title exception. If CITY delivers the Termination Notice within such ten (10) day period, the obligation of SELLER to sell, and CITY to buy, the Parcel as herein provided shall terminate and the Deposit shall be returned to CITY. CITY shall have the option to waive the condition precedent set forth in this Section 5.3 by written notice to SELLER. In the event of such waiver, such condition precedent shall be deemed satisfied. PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 4 6.4 Permitted Exceptions. In addition to such other exceptions to title as may be approved by CITY pursuant to the provisions of Section 5.3 above, CITY shall accept title to the Parcel subject to the following (collectively, the "Permitted Exceptions"): 6.4.1 The printed exceptions which appear in the ALTA (Form 197013) form extended coverage owner's policy of title insurance issued by Title Company in the State of Washington; and 6.4.2 Items created by, or on behalf of, CITY. 6.5 No New Leases or Contracts. Prior to Closing, SELLER shall not enter into any new leases, contracts or agreements affecting the Parcel without the prior written consent of CITY, except the SELLER may enter into interim contracts or agreements in connection with the management, maintenance, repair or preservation of the Parcel in the normal course of business if each such contract or agreement expires or is terminated at or prior to Closing. 7. CITY's Right of Entry. CITY, and its agents and consultants, at CITY's sole expense and risk, may enter the Parcel during the term of this Agreement at reasonable times scheduled in advance with SELLER for the purpose of CITY's due diligence study of the Parcel. CITY shall (a) exercise care at all times on or about the Parcel, and (b) take precautions for the prevention of injury to persons or damage to property on or about the Parcel. CITY shall keep the Parcel free from all mechanics', materialmen's and other liens, and all claims thereof, arising from any work or labor done, services performed, or materials and supplies furnished in connection with CITY's actions in the exercise of its right of entry on the Parcel, and CITY shall indemnify and defend SELLER against and hold SELLER harmless from all such liens and claims. If this transaction fails to close for any reason other than a default by SELLER hereunder, CITY shall furnish SELLER with a copy of all such inspections, studies and surveys and shall assign or quitclaim all of CITY's right, title and interest in and to any permits, approvals, or permit or approval applications. 8. Closing. 8.1 Time for Closing. This purchase and sale shall be closed in the office of Escrow Agent on the Closing Date. CITY and SELLER shall deposit in Escrow with Escrow Agent all instruments, documents and monies necessary to complete the sale in accordance with this Agreement. Funds held in reserve accounts pursuant to escrow instructions shall be deemed, for purposes of this definition, as available for disbursement to SELLER. 8.2 Closing Costs. PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 5 8.2.1 SELLER's Costs. SELLER shall pay (a) the premiums for the standard coverage portion of the Title Policy, including applicable sales tax, (b) one-half (1/2) of all escrow fees and costs, (c) SELLER's share of prorations, if any, (d) all real estate excise taxes due as a result of this transaction, and (e) all assessments for local improvement or special benefit districts. 8.2.2 CITY's Costs. CITY shall pay (a) one-half (1/2) of all escrow fees and costs, (b) the recording fees for the Deed, (c) CITY's share of prorations, if any, and (d) any additional premium charged for extended coverage for the Title Policy and any additional endorsements or coverage CITY may require, including applicable sales tax. 8.2.3 Other Costs. CITY and SELLER shall each pay its own legal fees and fees of its own consultants. All other costs and expenses shall be allocated between CITY and SELLER in accordance with the customary practice of King County, Washington. 8.3 Real Property Taxation. Accordingly, SELLER shall be responsible for all real property taxes due and owing prior to the Closing. 8.4 Closing Documents. 8.4.1 SELLER's Documents. At Closing, SELLER shall deliver to Escrow Agent the following instruments and documents: 8.4.1.1 The executed and acknowledged Warranty Deed in a form acceptable to the City, conveying the Parcel to CITY, which Deed shall include a reservation of an easement for emergency access in a form acceptable to the City; 8.4.1.2 The executed real estate excise tax affidavit to accompany the Deed; and 8.4.1.3 An executed nonforeign person affidavit in the form required under Section 1445 of the Internal Revenue Code. 8.4.2 CITY's Documents. At Closing, CITY shall deliver to Escrow Agent the following funds, instruments and documents: 8.4.2.1 The balance of the Purchase Price in accordance with Section 3; 8.4.2.2 CITY's share of costs and expenses as determined in accordance with Section 7.3; and 8.4.2.3 The executed real estate excise tax affidavit referenced in Section 7.4.1.2 above. PURCHASE AND SALE AGREEMENT S0504-IA SAFEWAY_PurcSale Agreement.doc Page 6 8.5 Possession. CITY shall be entitled to possession of the Parcel upon Closing. 9. Title Insurance. As soon as available after Closing, SELLER shall provide to CITY the Title Policy, dated as of the Closing Date, subject only to the Permitted Exceptions. 10. Conditions to Closing. 10.1 CITY's Conditions to Closing. Notwithstanding anything to the contrary set forth herein, CITY's obligation to close hereunder is expressly subject to satisfaction or waiver by CITY in writing of each of the following conditions: 10.1.1 Written confirmation of the Washington State Department of Ecology's ("DOE") consent to the sale as provided for in the Restrictive Covenant between Boeing and DOE dated September 18, 2002, a copy of which is attached hereto as Exhibit F. 10.2. SELLER's Conditions to Closing. Reserved. 11. Representations and Warranties. 11.1 SELLER's Representations and Warranties. In addition to any other representations or warranties of SELLER elsewhere in this Agreement, SELLER represents and warrants to CITY now, and as of the Date of Closing, that: 11.1.1 Authority. SELLER, and the person signing on behalf of SELLER, has full power and authority to execute this Agreement and perform SELLER's obligations hereunder, and all necessary action to authorize this transaction has been taken, except as specifically provided herein. 11.1.2 Hazardous Substances. SELLER has not received notification of any kind from any governmental agency suggesting that the Parcel is or may be targeted for a Hazardous Substances cleanup; to the best of SELLER's knowledge the Parcel has not been used (a) for the storage, disposal or discharge of oil, solvents, fuel, chemicals or any type of toxic, dangerous, hazardous or biological waste or substance (collectively, "Hazardous Substances"), or (b) as a landfill or waste disposal site; to the best of SELLER's knowledge the Parcel has not been contaminated with any Hazardous Substances; and to the best of SELLER's knowledge, there are no underground storage tanks on the Parcel. 11.1.3 Other Rights. No person or entity has any right to lease or purchase any interest in the Parcel or any part thereof. PURCHASE AND SALE AGREEMENT 50504-1A SAFEWAY_PurcSale Agreement.doc Page 7 11.2 CITY's Representations and Warranties. In addition to any other representations and warranties of CITY elsewhere in this Agreement, CITY represents and warrants to SELLER now, and as of the Date of Closing, that (a) CITY has full power to execute, deliver and carry out the terms and provisions of this Agreement, and has taken all necessary action to authorize the execution, delivery and performance of this Agreement; and (b) the individual executing this Agreement on behalf of CITY has the authority to bind CITY to the terms and conditions of this Agreement. 11.3 "AS IS" CONDITION OF PROPERTY. THE PURCHASE PRICE REFLECTS THAT THE PARCEL IS BEING PURCHASED BY CITY ON AN "AS IS" "WHERE IS" AND "WITH ALL FAULTS" BASIS, EXCEPT TO THE EXTENT OF REPRESENTATIONS AND WARRANTIES SPECIFICALLY MADE BY SELLER HEREIN OR IN THE WARRANTY DEED OR OTHER DOCUMENTS TO BE DELIVERED TO CITY AT CLOSING. CITY HEREBY WAIVES AND RELINQUISHES ALL RIGHTS AND PRIVILEGES ARISING OUT OF, OR WITH RESPECT TO, ANY REPRESENTATIONS, WARRANTIES OR COVENANTS, WHETHER EXPRESS OR IMPLIED, WHICH MAY HAVE BEEN MADE OR GIVEN, OR WHICH MAY BE DEEMED TO HAVE BEEN MADE OR GIVEN, BY SELLER OR ITS REPRESENTATIVES, INCLUDING BUT NOT LIMITED TO ANY BROKER, EXCEPT FOR THOSE REPRESENTATIONS, WARR.ANTIES AND COVENANTS SET FORTH IN THIS AGREEMENT OR IN ANY DOCUMENTS TO BE EXECUTED AND DELIVERED BY SELLER AT CLOSING. EXCEPT TO THE EXTENT OF ANY REPRESENTATIONS OR WARRANTIES SET FORTH ELSEWHERE IN THIS AGREEMENT OR IN ANY DOCUMENTS TO BE EXECUTED AND DELNERED BY SELLER AT CLOSING, CITY HAS NOT RELIED UPON AND WILL NOT RELY UPON, AND SELLER EXPRESSLY DISCLAIMS, ANY REPRESENTATIONS OR WARRANTIES WITH RESPECT TO, AND SHALL HAVE NO LIABILITY FOR: (I) THE CONDITION OF THE PARCEL OR ANY BUILDINGS, STRUCTURES OR IMPROVEMENTS LOCATED THEREON OR THE SUITABILITY THEREOF FOR HABITATION, OCCUPANCY OR FOR CITY'S INTENDED USE OR FOR ANY USE WHATSOEVER; (II) ANY APPLICABLE BUILDING, ZONING OR FIRE LAWS OR REGULATIONS OR WITH RESPECT TO COMPLIANCE THEREWITH OR WITH RESPECT TO THE EXISTENCE OF OR COMPLIANCE WITH ANY REQUIRED PERMITS, IF ANY, OF ANY GOVERNMENTAL AGENCY; (III) THE AVAILABILITY OR EXISTENCE OF ANY WATER, SEWER OR UTILITIES, ANY RIGHTS THERETO, OR ANY WATER, SEWER OR UTILITY DISTRICTS; (IV) ACCESS TO ANY PUBLIC OR PRNATE SANITARY SEWER SYSTEM; (V) THE FACT THAT ALL OR A PORTION OF THE PARCEL MAY BE LOCATED ON OR NEAR AN EARTHQUAKE FAULT L1NE; OR (VI) EXCEPT AS SPECIFICALLY SET FORTH ABOVE, THE PRESENCE OF ANY HAZARDOUS SUBSTANCES 1N ANY IMPROVEMENTS ON THE PARCEL, iNCLUDING WITHOUT LIMITATION PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 8 ASBESTOS OR FORMALDEHYDE, OR THE PRESENCE OF ANY ENVIRONMENTALLY HAZARDOUS WASTES OR MATERIALS ON OR UNDER THE PARCEL. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, EXCEPT TO THE EXTENT OF ANY REPRESENTATIONS OR WARRANTIES SET FORTH ELSEWHERE IN THIS AGREEMENT OR 1N ANY DOCUMENTS TO BE EXECUTED AND DELIVERED BY SELLER AT CLOSING, SELLER SHALL HAVE NO LIABILITY TO CITY WITH RESPECT TO THE CONDITION OF THE PARCEL UNDER COMMON LAW, OR ANY FEDERAL, STATE, OR LOCAL LAW OR REGULATION, INCLUDING BUT NOT LIMITED TO THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY ACT OF 1980 AS AMENDED, 42 U.S.C.A. SECTIONS 9601 ET SEQ., AND THE WASHINGTON MODEL TOXICS CONTROL ACT ("MTCA"), RCW 70.105D. CITY HEREBY RELEASES AND WAIVES ANY AND ALL CLAIMS WHICH THE CITY HAS OR MAY HAVE AGAINST SELLER UNDER ANY OF THE FOREGOING LAWS OR WITH RESPECT TO THE CONDITION OF THE PARCEL, EXCEPT TO THE EXTENT OF ANY CLAIMS CITY MAY HAVE ARISING FROM ANY EXPRESS REPRESENTATIONS, WARRANTIES OR COVENANTS OF SELLER UNDER THIS AGREEMENT OR ANY DOCUMENTS TO BE EXECUTED AND DELIVERED BY SELLER AT CLOSING. CITY ACKNOWLEDGES TO SELLER THAT CITY IS GIVEN THE OPPORTUNITY UNDER THIS AGREEMENT TO FULLY INSPECT THE PARCEL AND CITY ASSUMES THE RESPONSIBILITY AND RISKS OF ALL DEFECTS AND CONDITIONS, INCLUDING SUCH DEFECTS AND CONDITIONS, IF ANY, THAT CANNOT BE OBSERVED BY CASUAL INSPECTION, SUBJECT TO THE EXCEPTION OF RIGHTS EXPRESSLY SET FORTH ABOVE. SELLER: CITY: IF A PHASE I ENVIRONMENTAL SITE ASSESSMENT REPORT OR OTHER ENVIRONMENTAL STUDY OR REPORT (COLLECTIVELY, THE "PHASE I REPORT") HAS BEEN DELIVERED BY SELLER TO CITY, THEN, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, BY CLOSING THE TRANSACTION AS CONTEMPLATED HEREIN, CITY AGREES THAT, EXCEPT TO THE EXTENT EXPRESSLY CONTRARY TO ANY REPRESENTATIONS, WARRANTIES OR COVENANTS OF SELLER SET FORTH IN THIS AGREEMENT: (A) CITY SHALL BE DEEMED TO HAVE ACCEPTED ALL RISK ASSOCIATED WITH ADVERSE PHYSICAL CHARACTERISTICS AND EXISTING ENVIRONMENTAL CONDITIONS THAT MAY OR MAY NOT HAVE BEEN REVEALED BY CITY'S 1NVESTIGATION OF THE PHASE I REPORT, AND (B) AS BETWEEN SELLER AND CITY, CITY SHALL BE DEEMED TO HAVE ACCEPTED ALL COSTS AND LIABILITIES ASSOCIATED IN ANY WAY WITH THE PHYSICAL AND ENVIRONMENTAL CONDITION OF •THE PARCEL. CITY ACKNOWLEDGES AND AGREES THAT SELLER MAKES NO REPRESENTATIONS OR WARRANTIES REGARDING THE TRUTH, ACCURACY PURCHASE AND SALE AGREEMENT 50504-1A SAFEWAY_PurcSale Agreement.doc Page 9 OR THOROUGHNESS OF THE 1NVESTIGATION, PREPARATION OR CONTENT OF THE PHASE I REPORT, OR THE COMPETENCE OR ABILITY OF THE PERSONS OR COMPANIES PREPARING SUCH REPORT.- CITY AGREES THAT, BY CLOSING THE TRANSACTION CONTEMPLATED HEREIN, CITY WILL HAVE HAD AN OPPORTUNITY TO REVIEW THE ABOVE REPORT PRIOR TO THE CLOSING DATE 1N ORDER TO MAKE AN INDEPENDENT VERIFICATION OF THE INFORMATION CONTAINED THEREIN, AND THAT CITY AND ITS ENVIRONMENTAL CONSULTANTS WILL HAVE HAD AN OPPORTUNITY TO CONDUCT TESTS ON THE PARCEL. 12. Maintenance of Property; Risk of Loss, Condemnation. • 12.1 Maintenance of Property. From the date of this Agreement until the Closing Date (or any earlier termination of this Agreement), SELLER agrees to maintain the Parcel in substantially the same condition existing as of the date hereof, ordinary wear and tear, damage by casualty excepted. 12.2 Risk of Loss; Condemnation. Risk of loss of or damage to the improvements on the Parcel shall be borne by CITY at all times and no event of casualty or damage shall affect the parties' obligations hereunder or the Purchase Price, however, CITY shall have the right to receive any insurance proceeds due SELLER in connection with any casualty or damage and SELLER hereby covenants to maintain commercially reasonable casualty insurance in place with respect to the Policy/Court Building at all times prior to Closing. SELLER shall promptly notify CITY of any condemnation or eminent domain proceeding which affects the Parcel or the Alley, and SELLER covenants and agrees not to commence or pursue any such action. In the event of any condemnation or eminent domain proceeding by any entity other than SELLER, or a deed in lieu or under threat thereof, which affects a material portion of the Parcel, CITY may elect either to terminate this Agreement, or to purchase the Parcel in the condition existing on the Closing Date without adjustment of the Purchase Price. If CITY elects to terminate this Agreement, the Deposit shall be returned to CITY. If CITY elects to purchase the Parcel, SELLER shall not be liable to restore same, and CITY shall be entitled to any condemnation award or payment in lieu thereof payable to SELLER in its capacity as the owner thereof. 13. Default. 13.1 Time of Essence. Time is of the essence of this Agreement. 13.2 SELLER's Remedies for CITY's Default and Failure to Close. If CITY fails, without legal excuse, to complete the purchase of the Parcel in accordance with this Agreement, SELLER's sole and exclusive remedy shall be to retain the Deposit as liquidated damages. CITY expressly agrees that the retention of the Deposit by SELLER represents a reasonable estimation of the damages in the event of CITY's default and PURCHASE AND SALE AGREEMENT 50504-1A SAFEWAY_PurcSale Agreement.doc Page 10 failure to close hereunder, that actual damages may be difficult to ascertain and that this provision does not constitute a penalty. In this respect, CITY and SELLER acknowledge that these damages have been specifically negotiated between CITY and SELLER and are, inter alia, to compensate SELLER for delaying the eventual sale of the Parcel and to compensate SELLER for its costs and expenses associated with this Agreement. CITY hereby waives the rights and benefits of any law, rule, regulation or order now or hereafter existing that would allow CITY to claim a refund of the Deposit as unearned earnest money, a penalty or for any other reason except default by SELLER. 13.3 SELLER's Remedies for CITY's Default Under Section 14. Should CITY breach any of its obligations under Section 14, and such failure shall not be cured by CITY within thirty (30) days after CITY's receipt of written notice thereof, SELLER shall have the right to pursue any remedies available to it at law or equity, including specific performance or damages but excluding rescission. 13.4 CITY's Remedies for SELLER's Default. If SELLER fails to complete the sale of the Parcel in accordance with this Agreement, CITY shall have and may enforce the following exclusive remedies: (a) seek specific performance; (b) terminate this Agreement, receive a refund of the Deposit and recover from SELLER all of CITY's actual third-party costs and expenses incurred by it in connection with the transaction and the Project; or (c) seek rescission of this Agreement and receive a refund of the Deposit. 14. Notices. All notices, demands and other communications required or permitted to be given hereunder shall be in writing, and shall be sent by personal delivery (including by means of professional messenger or courier service) or registered or certified mail, postage-prepaid, return-receipt requested. Notice shall be deemed to have been given if personally delivered, upon receipt, and if sent by mail, two (2) days after duly deposited in the U.S. Mail. The parties' respective addresses for notices are as follows: If to City: City of Auburn Human Resources Department 25 West Main Street Auburn, WA 98001-4998 Attn: Planning Director With copies to: City of Auburn 25 West Main Street Auburn, WA 98001-4998 Attn: City Attorney If to SELLER: Safeway, Inc. Garv Slabauah PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 11 1121 124th Ave NE With copies to: Bellevue, WA 98005 Notice of change of address shall be given by written notice in the manner detailed in this Section 13. 15. General. This is the entire agreement of CITY and SELLER with respect to the matters covered hereby and supersedes all prior agreements between them, written or oral. This Agreement may be modified only in writing, signed by CITY and SELLER. Any waivers hereunder must be in writing. No waiver of any right or remedy in the event of default hereunder shall constitute a waiver of such right or remedy in the event of any subsequent default. This Agreement shall be governed by the laws of the State of Washington. This Agreement is for the benefit only of the parties hereto and shall inure to the benefit of and bind the heirs, personal representatives, successors and permitted assigns of the parties hereto. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision hereof. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 16. Commissions. SELLER represents to CITY that SELLER has engaged no broker, agent or finder in connection with the negotiations leading to this Agreement. CITY represents to SELLER that CITY has not engaged or in any way dealt with any broker, agent or finder in connection with the negotiations leading to this Agreement. Each party hereby agrees to indemnify, defend and hold the other party harmless from and against any claims for broker's, agent's, or finder's fees or commissions arising from or through the actions of the indemnifying party. 17. Assignment. CITY may, without need of SELLER's consent but after at least five (5) days prior written notice to SELLER, one time only assign this Agreement and CITY's rights hereunder prior to Closing to an entity owned or controlled by CITY, but no such assignment shall release CITY from its obligations under this Agreement. 18. Attorneys' Fees. In the event suit or action is instituted to interpret or enforce the terms of this Agreement, the prevailing party therein shall be entitled to recover from the PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 12 other party such sum as the Court may adjudge reasonable as attorneys' fees, including fees incurred at trial, on any appeal and in any petition for review. 19. Exclusivity. During the term of this Agreement SELLER shall not market nor list the Parcel for sale, nor accept any offers from third parties with respect to sale of the Parcel. 20. Reservation of Police Power. Notwithstanding anything to the contrary set forth herein, SELLER understands and acknowledges that the CITY's authority to exercise its police (regulatory) powers in accordance with applicable law shall not be deemed limited by the provisions of this Agreement. 21. City Council Approval. The Seller acknowledges that this Agreement does not bind the City of Auburn until the City Council approves of the purchase Agreement and the Mayor executes the Agreement. 22. Exhibits. Exhibits A, B, C, D, E and F attached hereto are incorporated herein as if fully set forth. 23. Recording. This Purchase and Sale Agreement may be recorded. SIGNED in duplicate original as of the date first above written. CITY OF AUBURN SAFEWAY,INC. By Peter B. Lewis, Mayor Attest: Name Title Danielle Daskam, City Clerk Approved as to form: Daniel B. Heid, Auburn City Attorney PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 13 EXHIBITS Exhibit A, Legal Description of Safeway Property Exhibit B, Legal Description of the Parcel (portion City to purchase) Exhibit C, Parcel Map Exhibit D, Drainage Agreement Exhibit E, Declaration of Covenants, Conditions, Easements and Restrictions Exhibit F, Restrictive Covenant between Boeing and Safeway PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 14 EXHIBIT A LEGAL DESCRIPTION OF SAFEWAY PROPERTY Location: 3520 PACIFIC AVE S AUBURN WA 98001 Assessor's Property Tax Parcel Numbers: 252104-9096 Legal Description: That portion of the East half of Section 25, Township 21 North,-Range 4 East, Willamette Meridian, King County, Washington, more particularly described as follows; Lot 1 of the City Of Auburn Lot Line Adjustment No. LLA02-0015, as recorded under recording no. 20020725001632, records of said county. PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 15 EXHIBIT B LEGAL DESCRIPTION OF PORTION OF PROPERTY TO BE PURCHASED BY THE CITY OF AUBURN Location: 3520 PACIFIC AVE S AUBURN WA 98001 Legal Description: LEGAL DESCRIPTION OF THE 1.2 ACRE SAFEWAY PARCEL That portion of the Northeast quarter of Section 25, Township 21 North, Range 4 East, Willamette Meridian, King County, Washington, more particularly described as follows: The North 430 feet of Lot 1 of the City Of Auburn Lot Line Adjustment No. LLA02-0015, as recorded under recording no. 20020725001632, records of said county, as measured perpendicular to the most Northerly line of said Lot 1, said most Northerly line Bearing South 89° 12' 14" East, a distance of 57.79 feet. PURCHASE AND SALE AGREEMENT 50504-1A SAFEWAY_PurcSale Agreement.doc Page 16 EXHIBIT C LOCATION MAP S 89'12'14" E 57.79' 1.2 Acre Safeway Parcel 0' 200' 400' N Ol'06-42' W 92.34' kn J ~ m L=630.88' ~ R=603.11' p=59'56'03" IZ S 89' 12' 14" E 236.92' 1 "=200' ~"I Z~p,0o 6~2 ~ ~0~ G~~~OMB~R 2 ~ P~~~ R~CpRp\N w 1 ~~P~f o p m S~'2 FQI, 1HI5 EXHIBIT MAP IS BASED ON CITY OF AUBURN LOT LINE ADJUSTMENT LLA02-0015 REDORDED UNDER ExPREs KING COUNTY RECORDING NUMBER 20020725001632 AND DOES NOT REPRESENT A BOUNDARY SURVEY. n • 0) -4 ~ ~ r¢ FRI ~~1~ LAM~~ ~R.~ 1-` . Exhibit for 1.2 Acre Safeway Parcel EXHIBIT MAP TO ACCOMPANY LE(3AL DESCRIPTION WASHINGTON " CITY OF AUBURN PUBUC WORKS F9bfU8fy 11, 2008 25 WEST MAIN STREET AUBURN, WA 98007 PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 17 EXHIBIT D DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS a~ -l' PURCHASE AND SALE AGREEMENT 172824.doc Page 18 PURCHASE AND SALE AGREEMENT 50504-1A SAFEWAY_PurcSale Agreement.doc Page 18 EXHIBIT E DRAINAGE EASEMENT _ . . , . Pi~SNbB RBC70RD' AHI) PH~f . - . . BBCORDBD, RSTURt7 TO: . Gerald 8reeslour Otiaae of tM OeneralCovasel . . 'Pbe BoEiag Comgany 10 TiH 3707, 124 96C 13-OB SeAtt yas'Hy4s; 9iDOC;FR,1W TTtLSe Drainsge Agrelffm4t . . . . . o REFSRMWM NUMBM28 OP RBLATIm. DOCfMqTB: . o GRAWT.OR1B0&aOWER- Ths Boeaa9 CcapenY and SaEevay Iuc. . tlRANTBB/AS81(iM/882-W fCIARX: . e~a 139AT. DBSCRIPRIONs Portlone ot S.ectlons 24. awd 25. T2111. &48, ° . , N.N.: in xing Munty. Mas}ungEon, at more . ~fully deaaribad ia Sldssbiia A and H, . beginaing on paoge Ja_., A8SR8@OR'8 PARCffi. 1;0(8) e 242304-90691 ]4]104-9089, 292304-9090; 242104-9091;~242104-9092; 242104-9093i . ' 242101-90941 242104-9095t 25410479035j 257304-9D78T. , . 252104-90801252104-9084, 452104-9094;.252104-9096j . . 2S)104-91041 252104-9105i 357104-91061 252104-4307j ana sssioa-saoe RFDPoRR~Ip1fE11~UQ6TOF . 1HAIL4NNION7ITLENUVMMC0. . PURCHASE AND SALE AGREEMENT 172824.doc Page 19 PURCHASE AND SALE AGREEMENT S0504-1A SAFEWAY_PurcSale Agreement.doc Page 19 WHEN RECORDED RETURN TO: City of Auburn Attn: Facilities Management 25 W. Main Street Auburn, WA 98001 BARGAIN AND SALE DEED Grantor: Safeway, Incorporated, a Delaware Corporation Grantees: City of Auburn, a Washington Municipal Corporation . Abbreviated Legal: The North 430 feet of Lot 1 of the City Of Auburn Lot Line Adjustment No.LLA02-0015, as recorded under recording No. 20020725001632, records of King County, as measured perpendicular to the most Northerly line of said Lot 1, said most Northerly line Bearing South 89° 12' 14" East, a distance of 57.79 feet. Tax Parcel Number(s): GRANTOR, SAFEWAY, INCORPROATED, a Delaware corporation for and in consideration of TEN DOLLARS ($10.00) and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, bargains, sells and conveys to CITY OF AUBURN, a Washington municipal corporation and political subdivision of the state of Washington the real property situated in King County, Washington, legally described in Exhibit A attached hereto and by this reference incorporated herein. Subject to those matters set forth in Exhibit B attached hereto and by this reference incorporated herein. Dated this day of , 2009. Grantor: SAFEWAY, INCORPORATED Bargain & Sale Deed Page 1 of 4 50504-1B SAFEWAY_BargainSale Deed.doc STATE OF WASHiNGTON ) ) ss COUNTY OF PIERCE ) On this day of , 2008, before me personally appeared , to me known to be the of the municipal corporation that executed the foregoing instrument, and acknowledged said instrument to be the free and voluntary act and deed of said corporation, for the uses and purposes therein mentioned, and on oath stated that he was authorized to execute said instrument and that seal affixed is the corporate seal of said corporation. Notary Public in and for the State of Washington My Commission Expires: _ Bargain & Sale Deed Page 2 of 4 S0504-1B SAFEWAY_BargainSale Deed.doc EXHIBIT A LEGAL DESCRIPTION OF THE 1.2 ACRE SAFEWAY PARCEL That portion of the Northeast quarter of Section 25, Township 21 North, Range 4 East, Willamette Meridian, King County, Washington, more particularly described as follows: The North 430 feet of Lot 1 of the City Of Auburn Lot Line Adjustment No. LLA02-0015, as recorded under recording no. 20020725001632, records of said county, as measured perpendicular to the most Northerly line of said Lot 1, said most Northerly line Bearing South 89° 12' 14" East, a distance of 57.79 feet. EXCEPT for an easement for emergency access across said Parcel, which access may only be used by the Grantor. Bargain & Sale Deed Page 3 of 4 50504-1B SAFEWAY_BargainSale Deed.doc EXHIBIT B 1. Drainage Easement by and between The Boeing Company and Safeway dated September 18, 2002 and recorded under King County Recording No. 20020920001615. PROVIDED, that Safeway covenants and warrants that it shall remain fully responsible for all obligation and costs under the Drainage Easement, and shall defend, indemnify, and hold harmless the City from any obligations thereunder. 2. Declaration of Covenants, Conditions, Easements, and Restrictions by and between The Boeing Company and Safeway dated September 20, 2002, and recorded under King County Recording No. 20020920001614. PROVIDED, that Safeway covenants and warrants that it shall remain fully responsible for all obligation and costs under the Declaration, and shall defend, indemnify, and hold harmless the City from any obligations thereunder. 3. Declaration of Restrictive Covenant between the Boeing Company and the State of Washington Department of Ecology dated September 18, 2002 and recorded under King County Recording Number 20020920001611. PROVIDED, Safeway covenants and warrants that it shall remain fully responsible for all obligation and costs under the Declaration, and shall defend, indemnify, and hold harmless the City from any obligations thereunder. 4. ADDITIONAL RESTRICTIONS AS SET FORTH IN A TITLE REPORT MAY NEED TO BE INCLUDED HERE . [END OF EXHIBIT BJ Bargain & Sale Deed Page 4 of 4 S0504-1B SAFEWAY_BargainSale Deed.doc