HomeMy WebLinkAboutCostco Wholesale Corporation 2013-12-19i
Albany ������� ���g Nortliern Vrginia
Atlanta �Aldrldge Orange Counry
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Brussels Rancho Santz Fe
Denver Spear Tower•One Market Plnza, 241h Floor San Dtego �
I San Francisco, CA 94105 '
Los Angeles Tel:415167.4000 San Rancism �
Mlami mckennalongmm Seoul
New York Washington,DC
DAVID B. FRANKLW EMAIL A�DRESS
� Duect Phone�.415.356A624 d(ranklin@mckennalong.com ,
Direct Fax�. 415.356.3869
Dcccmhcr 20. ?01 i � �
;i)� � C� � O �`I [� �
��I� ��!� DEC 2 6 2013
Janc C'hambcrs �� � �
Cil�- Vlanaecr/I?xcctttivc Director
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Citti uf Ul;iah " -
� 300 Scmin.�rv A��cnuc
Ukiah. C'/� 95=}R2 '
IZc: n��rccmcnt bv and bct�vccn thc C'itv uf Ul:i��h and Costco Wholesalc Cor�oration
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Clicnt-Mattcr l�o.: 1�d0�1�.001 i2-
I)ct�r Ms. Cht�mbcrs:
' I�,nclosc�l (or your filc is a lully eaccutcd original /�grccmcnl d�itcd Dccembcr 19. 3013.
Vcry u'uly yours.
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ICOU N0. 1314-164
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IACiREF.MF.N"I' '
By and Bctwcen ��
I'IIF. C1�11' OC UKI_Ali,
a municipal corporation, in its municipal cspacity and
, as Successor Agency lo tlie lil:iah Redevclopmeni ngency I
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COS"I�CO �T'I IC>I.ESAI.I� CORPORn�l'IOn. i
a Washington corporation ���
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USN'803J I j30a Ih
17/32013 �
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TA131,Ii OP CON"CtiN"1'S
}�ft�.CUS WPSTYU35Li3bd7
�oo. sus.ih:c r oH� n�itrr_Ntr�v�r.........................................................................................................i
]O1. P�uposeoi'ThisAgreeme�ll .............................................................................................................1
102. The Sitc............................................................................................................................................1
103. Parlies to "fhis Agreement.............................................................._...............,................................1
103.1 Cit}'........................................................................................... .......................................................I
103.2 Coslco ..............................................................................................................................................1
104. I)eposit........._.......................................................................... .......................................................1
200. I)ISPOSITION OI 'I'I{E SI"I'}:........................................................................................................?
20LSalc and Purchasc ..................................................................................... ......................................Z
?02. F,scruw....................... ............................................. __.................................,..................................2
203. Convey�nce of 7'itle and Delive�y of Posscssion ._._............................_.__ ..................................d
204. Porm of Uecil........ ................................................................ .................... ....................................4
205. Condilii�ns Prcccdcnt to Convcyancc ..............................................................................................5
205.1 Condiliuns for Bcnclit of Costco.....................................................................................................i
2052 ('imditions Ibr the Renetit of('ity . ............__...._..............................._....___....._........._..............6
206. Conditiun oY Tide.............................................................................................................................7
20E.1 Titic Commitmcnl and "I itic Policy .................................................................................................7
206? Sw vcy ..............................................................................................................................................3
206.i Review of Til le Commitmcnt and Survey..................................................................... .................8
206.a City's Kight to Ciu'e l itle Objeclions..............................................................................................9
206.5 Monetm y Gncumbranccs .................................................................................................................9
20C.( 'I'itic Pccs..........................................................................................................................................9 I
207. fime tor and Place of Delivciy nf need and Closing I)ocuments .................................................9
20R. Paymcnt oPthe Yurch�se Price �nd lZecord�tion oPUccd..............................................................10 I
209. I'itic Insurancc ...............................................................................................................................1 1 �
210. faiscs wd Assessntents..................................................................................................................] 1
21 1. <'onveyance i'rec of Nosscssinn_........................................... .................. .................... ... . ......... I 1
212. luspcclion; ............................................................................. .......................................................1 1
212.1 Inspcclions ............................................................................... .....................................................1 I
212.2 Release and Waivcr......................................._........................................,.....,................................12
213. Condition ofthc Sitc; h'casibilily Period................................................... ...........__..................._t2
214. Kcprescnlations �Varranties and Covcna�ris..................................................................................13
215. Closing Date Exlcnsiun......................................................_...................,.,............._.....................17
216. Posl-Closing Adjustments..............................................................................................................]8
300. DLVIiLOPMF,NI OI� TIII Sl"CC............................................................................._._................IEi
30 L Dcvclopmcnt uf the Sitc by Coslcu ...............................................................................................18
301.1 Scope of DevdopmcnL..................................................................................... ............................18
301.2 Ciry npproval of Plaiis, Drawings aud Rclatcd Documcnls..........................................................18
301., CaslufConsuuction........................._.................................................................................,......._19
uswsoasis�a_is iuizizni3 �
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TABLE OF CONTEN"I'S
(conrinued)
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301.4 Construction Schedule......................................................................_...........................................19
301.5 13odily Injury, Property Damage and Worl<ers' Compensation hisuranec...._...............................19
301.(i Cily and Other Uovernmental Pcrmits............................................._............................................19
i01J Rights of�lcccss ............................................................................................................................I 9
>01.8 LocaL State and Pederal Laws................._....................................................................................ZO
30L9 Antiiliscriminulion llurin� Consiruction .......................................................................................20
302. RcsponsibiliticsofCity............................ ._.............................................................,....................20
303. faxes, nssessments, Lncumbrances and Liens .............................................................................23
304. Prohibition r�gniust �Crnnster of Site, the Buildin�s or Struclures Thercon nnd l�ssigumeut
oCA�rcemcnt .................................................................................................................................23
305. Sccurity Finnncing; Rights of llolders........................................_.................................................24 �
305.1 Nu I;ncumbrtuices F.xcepl Mortgages, Decds of 'I�rust, Sules and Lease-L3acks or plher
Pinancing ti�r Developmcnt ..................... .............._.........................,..................._.....................?4
3052 Hulder Not Ohligated to Construct Improvements........................................................................24
305.3 No[ice of Deiault to Morlgage, Decd of Trust or Other Secw�ity Interest I lolders; Righl to
C'u re.................. .............................................................................................................................24
305.4 Failure of F{older [o Complcte Improvements..............................................................................?5
305.5 Right of City to Cure Mortgage, Deed of`Crust or OQter Security luterest Default......................25
i06. Right of City to Satisty Othcr Licns on Ihc Sitc A1tcr Title Passcs...............................................2(
a00. USF, OP THG SI'fL........................................................................................................................21i
d01. Uses.............................................................. ........................................................._......................26
402. Obligation to kefrain l�rom I)iscriminatian...................................................................................26
40;. Form of Nondiscrimination a��d Nonscgrcgation Clauses........................................ ....................2G
a04. Llicct an�l Duration of C'ovcuants..................................................................................................27
40�. Kigh[s of.Access - Puhlic Improvements and Facili�ies................_......................... ....................27
�00. I)F:I�AUL'1'S, IZI:MI-;UIfIS ANll "I GRMINA'llON.......................................................................27
.SO1. Deiaidis Gcncral .........................................................................................................................27
50?. I,rgal Aciions.................................................................................................................................28 I
j02.1 Institution of Lcgal i\ctions..................... ........_.......... . _._............._..........................................28
�02.2 ilpplicable I,a�v; Inta��rctalion......................................................................................................28 I�
5033 l�cceptancc of Sei��ice ol�l'roccss..................................................................................................28 �
503. Righ[s and Remedies are Cumulative........................... ................................................................28
504. Remedies Generally........................................................._...........___..........................................28
505. IZemcdics and Rights oi`I crmina(ion ..........................._..........................................,....................29 �I
$05.1 "I'crmination by Costco..................................................................................................................?9 I
505.2 Tcnnination by City.......................................................................................................................29
50C. Optiun to Repurchase, Rcenter and Reposse�s..............................................................................;I
600. GENE2AL PROVISIONS ..........................................................................._...............................32
GO1. Notices, Dem�nds and Communicatimis Between the Partics ......................................................32
(02. Conflicts of Intcrest........................................................................................................................33
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rar�t.i-: or corvrr:!vrs
(cu,�r,nta�d)
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603. Nonliability ofCity Ofticials and Gnployccs ....................__..................................,.,..................33
604. Tttforcecl llelav: Lxicnsion of'I�imcs of Performanc�........__................_..........__......................33
60�. Inspection of Books and Records ..................................................................................................33
606. I'luns...............................................................................................................................................34
607. ��ttorncys I'ccs...............................................................................................................................34
608. Successors I3ottnd ......................................................................................................... ................;4
609. Severahility.........................................................................._..................................... ..................34
610. Captions .................................................................................._............... .....................................34
6] L Construction............................................................................_....................................,................34
(i12. Coslco's Approvttl Righ[s.............................. .............................................................. ................;4
513. Computation of7 imc..................................... ......................._......._......._...._............. ................3�
700. SPt:C�nl, �'xovlsloNS...............................................................................................................35
701. [)cvclopmcnt Rcstrictions.............................................................................................................35
702. Amer�elments to this Agreemenl.....................................................................................................35
703. f�rokers' Conunissions ............. ......._............................................__..........................._...............35
500. I-:N'l lH6 ,�GIZLGMGN 1. WnIVI?ItS AND AMENDMGNTS.....................................................35
900. "1'1MG POR ACCEV'I nVCti Oh' ,�GRF•,CMG1�T BY CITY........................................................3C
1000. COUN'I'ERPARTS; PACSIVIILI: SlU'N/�'fliRF,S.......................................................................37
/�ttachmcnts
Attach�uent No. I Map of�he Site
Altnchmcnt No. 2 Lcgal Dcscripliou oi�the Sitc
Attachment �lo. 3 Schedule of Performance
iltlachmcnt �lo. 4 Scope ol lJcvclopmc�it
Attschmeiit �lo. � Form of Cira�t Deed
Attuchmcnt Vo. 6 City�Successor Agcncy L:nvironmcntal Disclosures
Att:�chmcnt Vu. 7 L•:xclusivc Usc Cocenant
Attachment Vo. 8 Form of Memorandum of Agreement �
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!�GRI;IiMI�N'f
l'I IIS AGRI�;IiVI[�:N�I� is cntcred into t�s of the _ �� 1,,� da�� ol u�«ti+a���, 2013 (ihe "Gftecti��e
� Dxtc'). by and between the Cit�� of Uki.�h (°City'�), x general la��� municipal corporution. thc
Sucecssor Agenc}' to the fi�rmer Rcde��dopmenl Agencp li�r thc Cit�� ol Ul:i�h (..Successor
iAgenc��°), an�l Custcu Wholcsalc Curpuralion. ti bVashingtun co�poraiion (°Coslco"L City and
('nstco agree as follo����s:
IUU. SU13JI:CT OP' AGRI�.I:MCN'1'
101. Pw�pose o1'This A��recmcut �fhe ptuposc of lhis Agrecmcnl is to cl�lcctuale the
a,nvcyance I'rom the Successor Agency to Costco �ind the dcvclupment by Custco of ccrtain renl
��rupert}� o��vncd by the tiuccessor A�!cncy in thc ('ity uf l Il:i,ih (the "Sitc"). Citq. Costco and thc '
Itcdcvclopmcnt Agency ol� ihe (.'ily of Ukiah (thc "iZDn") entered into thut cert��iu Gsclusivc
Nogutiating /��rcemcnt (the ''ENl���) dated J�mu�iry 20, 201 l, in conicmplxtion of thc possible
tialc of thc Sitc hy the RI)A to Cosla�. �I�he RI)IA has tiincc hcen �liswl��ed. e�s ra�uired Ly I
(';iliti�rnia l:nv. and Succcssor l�gcncy has accedcil t�� ca�tain ri!_hts zind ubligation5 ofihc Rlln.
including ownership ol lhc Sile. This l�grecmcnt is in ti�rtha�.�ncc of thc objecti�res ol�the F,Nn. �
��n�l upon its a����roval and execution bq City. (he Successor ,�gency and Costm. tl�is Agrecment �
will replace und supersede thc GNt�. �
102. 'fhc Sitc �I�hc Site is lhat arex slw�a�u on Lhe Map (Altachmcnt Nu. I) an�l is more �
�i:n�ticularly dcscrihed in th� Le�,�l Dcscription otthe Site (�Atlachment No. 2). �
1113. P.�rties tu "1'his AErcement
1031 Cit�� and Succcssor Agcncv l�he oflice of Citc und lhc Succcssor A,�cncy
i, located at ;00 Seminary A��cnuc, Ulcix6. Calilurnin 9�45?. �fhcir 1<�� nurobcr is 707-a6>-
6204, Altn: City Mlnager/l�;�ecutivc Dircetor. "City° and Successor Agcncy as used in this
/�greement, iitcltides City. thc Suecessor Agency and �m;� assignee o�or successor to Iheir right,,
powurs ai�d resE�onsibilitics ��vith respcct to tl�e Sitc.
IU3.2 Custco �Ilie principal ol�l�ice of Cuslco is localed at 999 Lake Drive.
I;suyu��h. b\%a,hin�tun 9RU2Z Costco's fa� nwnber is 425-;13-5114, Flttu: Seth S. Katz.
\Nherever thc tcrm "Costco" is usrd hereiu. su�l� term sli�ill includc tiny pennitte�l numiiiec.
as,igncc or successor in inlcro�t as hcrcin provided.
IOa. Deposit I'ursuant to the �N1. Costcu previously has dclivcral tu ['ir5t tlmerican
�I�illc lu5urtuicc Cumpairy �i deposit in thc amuunl of PIF�I l' �I I IOUSi�NU DOLL�ARS ($SO,OQO)
(lhc "De�iosil"). which Dcposit �hall continue as security It�r tlic perli>rmancc of ihe ubligations
of('ostco undcr this Agrecmcnt tu be perlbnned priur lo thc retw n oCthc [)eposit tu ('uslco or its
upplication to Ihc Purch��sc Price or its rctcntiun by Cit��. Any inlerest carned un the Deposil
shall becume part uf lhc Depusit. Upun tennin:uion ol'this Agrcemci�t by City as pro��ided in
Srction �05.2 hereof. the Dcposit (includin� �II interest��aid thereon) shall be retainccl bp City as
liquidated d.�mages as proe�idad thercin. Upon tcrminatiun of this n�recment b}� Costco tis
��rovidcd in Scction 505.1 hcrcof, thc Dcposit (inch�din�_ all inta�cst paid thcrcon) shall bc
returncd w Custcu as ��rucided thercin. If thin Agrceinent shall nui havc been theretolixc
cancelleA or Ierminated, or the I�eposit sh�ll n�n hnvc been rrturned to Costco, the Deposit shall �
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be returncd to Costcu promptly folluwing issuance ul the Cerlilicate uCOccupancy (us defined in
' Section 301.1). For rurposes of ihis Agrccmcnt, issuance of thc Certilicatc of Occupancy by
City shall scrvc lhe }�in'poses that would I�ave been scrved by issuancc of a certitieate of
' coulplction by the RDA.
200. UISPOSITION OF THE SITG, �
201. Sale �nd Purcliase In accordancc with and subject to all thc tcrms. covenaniti
and conditions of this Agreement, City agrees to selL and Cosfio agrees to ptucliase for '
developmant, the Sitc for the sum oC'fHR]-:P, llOLL�1RS AND 50/100 DOLI.iVZS ($3.50) per
usable square Y'oot of the Site (the "Purchasc Pricc"). 'I�hc numbcr of usablc squarc I�cct vaithin
� lhe Sitc shall be confirmed pursu.mt to the Survey as pro�'ided in Section 20fi? of this
, Agreement, and that figure sltall be used to dclermine the Purchase Price. Coslco acknowledges
❑nd undc�stnnds that the Site will be conveyed to Costco fbr purposes of development pursu�nt
to lhis Agrecment and not for speculalion in undcvcloped land.
202. Gscruw C'ostco heretofore has upened nn escrow with the Sealtle Nationel
Comn�erci�il Services OII ice of Fiisl Amcric�n �I�itle Insurance Company ("'l�itle Cony�any') who
shall coordinate the cscrow witli Redwood �mpire Title Company (the "Gscrow A,ent"). This
Aorccmcnt constitutcs thc joiut escrow instructions of City and Succcssor Agcncy and Costco,
aoct a �luplicale copy of this A�reement shall be �letivere�l lu Ihe TiUe Company and lhe Escrow
Agent prompily 1'ollowing the Cffective Date. City and Successor Agency and Costco shall
� provide such additional cscrow instructions as shall bc ncccssary and consistcnl with this
' Agrccmcnt. "1'hc Escrow Agcnt hcrcby is cmpowcred to act undcr this A�rccmcnt and, upon
indicatiug ils acceplauce of tlic proviaiuus uf lhis Sccliun 202 in wriling, dclivered lo
City/Success�u Agcncy �nd to Costco within tive (�) days atter the n�iening n1'the escrow, shall
carry out its duties as liscrow Agent hcreunder. Costco sh�ll dcposil wilh the Hsm�ow l�gent lhe
1'tu-cliuse Price fnr the Site in accordencc H�ith the provisions of Section 208 of tltis Agreement.
Costco shall also pay in escrow to the Escrow Agent the followinc fees, charges and custs
prontp[Iy after the F,scrow Aaent hav notitied CosCCO nf the amount of such fees, charges aitd
costs, but not eurlier than ten (10) days prior to thc scheduled time t'or the close of escrow
(°Closing'or thc°Closing Date"):
7. One-half(1/3) of the escrow Cec; and
2. l�he poriiuii uf the premium for the title insurance policy or specixl endorsemcnts
to bc paid by Costco as set forth in Scctioi� 209 of this Agrccmcnt.
Successor Agency shall timely and properly execute, acknowle�ige and deliver a dec�l
conveyin� to Costco tidc to thc Sitc in accordancc with thc rcquircmcnts of Scction 204 of this
/�grecment, logether with aii esloppcl certilicate certilying lhat Costuu has complelcd all acts
� (escept de�iosit of the Purch�sc Price) necessary to entitle Costco to such conveyance, if such be
the fact City shall p�y in escro�v to the Gscro�� Agenl, or have charged against sales procecds
otl�erwisc disbursable to City, thc I�o]lowing 1ccs, chargcs and cos[s promptly afrcr thc Escrow �
Ageiit has notificd Gity uf the amount of such Iccs, char�es and costs, but ��ot eatlier than ten
(10) days ��ri�u to the scheduled time lor the Closing:
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1. Costs necessary to place tlie tide to the Site in the condilion for conveyance
required by the provisions of this Agreerocnt;
2. Ot�e-hal f(I�2) of the esc row fee;
3. Cost of drawing tha dccd;
4. Recording t�es;
5. Votary fees;
6. �I�lic premium for an G�.I..�I'.A. stand��rd title iusurance owncrs policy lo be paid by
Successa� ilgency as set forth in Section 209 of this ngrccment, and the premitims for any
� cndorscmcnls lcceptable to Costco and requested by Successoc Agency to insurc ovcr titic
exceptions the Successor Agency othcrwise is rcquired to rcmove from tide to lhe Site;
7. Ad valorem taxes, if any, upo� the Site for any time prior lo couveyance of titic;
and
8. Any state, coui�ty or city documentary Vansfer tax. �
Following delivcry of a deed to thc Escrow Agcnt by City pursuant to Section 207 of this
Agreement and the deposit b}' Costco with the F,scrow Agent of the Purchase Price and any other �
closing fands mqtiired L�om Costco, lhe Fscrow /�gcnt shall record such deed when title can be �
vcsted in Costco in accordance with the terms and provisions of this Agreeiuent. 7'he Escrow
Agent sl�all biry. aftix and cancel any transfer stamps required by law and pay any trai�sier tax
� rcquired by law. Any insurance policies goveining the Site are uot to be tr�nsferred.
Tl�e Lscrow ,4gent is authorized to:
' 1. P1y and cl�arge Successor and Costco, respectively, for �ny fccs, ch3rges ancl
costs payablc imdcr this Scction 202. Rclrn�c such p�iymcnis nrc m�dc, thc Cscrow Agcnt shall
provide City and Costco with settlement st�tements itemiving all Ices. chm�gc� �ind costs ,
necessaiy to clear title and close the escrow, which shnll he suhject to thcir respcctive .�pprova] ',
prior lo and as a condition to Closing;
2. Disburse funds and deliver the deed •and othcr documcnts to tl�e partics entiticd �
thereto when the condition, of this escrow have bcen ftdfilled by City aud Costco; and
3. Record any instrwnents delivered thro�.ioh this escrow, iC neccssary or proper, to �i
��est tiUe in Costco in accordance with the terms and provisions of this Agreement.
All funds received in this escrow shall be deposited by the I^;scrow Agent with other
escrow fuuds of the Lscrow Agent iu an interest-bearing gcncral escrow accouut or accounts I
�vith any state or national bank doing business. Such Cunds may be uxnslerred �u aoy othec such I
� genera] escrow account a� aecounis. AII disbursements shall bc made by check o1 the Gscro�v i
ilgcnt All �djustments shall be made on the basis of a [hirty (30)day month. I
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� If this esarow is ❑ot in condition to close belore tlu Closing D�te estabfished in
Suction 303 of this Agrccmcut, cithcr part�� who Ihcn shall have fully performed Uie acls to be
performed prior to ti�e Closing Date may, iu �n�riting, tern�iu�te ihis Agrcement in thc n�anner set
furlh iii Section 505�1 or 505.2 hm'eul�. tts �he cxsc u�ay be, and dema�d the return ul�its monies,
�itipers or documents. Thereupon till obligatio�is and ti�ibilitics of thc partics under this
Agrecmenl Shall ccase and tcrminalc in the manncr set Forth in Section 505,I or Sp5.2 hereof, as
, Che case may be. If ncitl�cr Successor Agency nor Costco sliall have Cully performcd thc acts to
be performecl belore lhe �ime fur couveyxnce cstablished in Sec�ion 203, na termina[ion or
demt�ud for return shall be reco�i�ired until ten (10) days .iller the }{scrow Agenl shall have
mailed copics of such dcmand to the olher party a� par[ics at il�e address of i[s or their principal
� pl�ice or placcs of busiucss. 1f a��y objcctions ��rc raiscd within thc tcn (]0) day period, tl�e
� I',soruw Agcut is auLhorivu�l lo hold tdl monics, papers and ducumcnls witli respecl to lhe Sile �
until instructeci in writing by both Successor Agency and Costco or u�ion failure thcreof by a
courl ol'competcnt jurisdicliou. If no such demand5 are madc, the escrow shall be closed as soon
as }�ossiblc. Nothing in lhis Scction 202 shall bc consirucd to impair or affcct lhc rights or �
obligatious uf City, Succe�sor Agency or CoStco tu speciGc �crformance;.
Any �mendment of these escrow instructions shall be in writing �u�d signed hy both �
Succcssor l�gcncy and Costco. nt [he time ol anv amendmcnl, t}�c Escrow /�gent shall agree lo
ceu�r}' out its duties us Gscrow �lgent under such �unendment All communications from thc
h;scrow /�gcnt lo City, Succcssor ngcncy or Costco shall bc dirccted to tl�c �ddresscs �nd in thc
munner established in See�ion 601 of diis Agreement for nntices, dem�nds and communications
among City, tiucccssor A�,cncy and C'ostco.
The liability of the Gscrow Agent under this Agreement is limited to �erformance of the ,
obligations im�osed upon it under Sections 202 to 209. both inclusive, of Yhiti Agrcement. ii
h;xcept as providcd in Scction 704, (a) neither Successor Flgency nor Costco shall bc liable for �
eny rcal estate commissions or brok�rage fe�es that may arise tlierefi'om, aud (b) Cily, Sttccessor
Agency aud Costco each represent that neither has engaged any broker, aget�t or tinder in
conncction with this transaction. �
203. Coirvev.�nce of TiHe and lleliverv uf Posaessiun Pruvi�led lhat Custcu is not in
dcl�vilt under this Agrecment and �II conditions �irecedent to such convcy�nce havc occurred,
and subject to any extensions of time }�ursuant to this Agreement, the Closing Date Y2�r
conveyancc to Costco of title to thc SiYc shall bc completed within thc timc period spccitied in
Ihc Schedule ol Perforinanec (Attachment Nu. 3). Successor Aaeucy and Costco agree to
��erfiirm all acis necessary to conveyance of titic in sufficicnt fime for title to he conveyed in
accordancc �vilh ihe foregoing provisions. Posscssiai shall be dclivered to Costco concurrently
wilh ihe convcy�nce of tillc, except iliat limited aceess may be permi�rocl before conveyauce of
titic �is permittcd in Scction 213 of this n�rccmcnt. Costco shall accept �itic and posscssion upon
amvcyance of title.
204. P'urm of Deed Successur ngency shcill convcy to Costco litle to tl�c Site in the
condition provided in Section 20(i of this ngreemcN by a �rant deed (the "G'ant Deed") in
substantially Ihc form sct Ibrth in ilriac6�ncnt No. 5.
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205, Conditions Precedent to ConveV:�ncc
205.1 Conditions for I3et�efit of Costco The obligation of Costco to c�ose tlic
transaction sct lorlh in this Agrccmcnt is subjcct lo thc 9�ulfillmcnt of thc followii�g conditions on
or prior tu the Clusing D<de, each of which shall continue as � conditiai until Cos�cu noti�es
City/Sucecssor ngency in writing, within Ihe respectivc timc period specified in the Schedule ot'
, Pcrfonnance (Attaehiuent No. 3), that each such condition ht�s been satislicd or is waived (the
"General Waiver Notice"); provided, howcvcr (hal conditions a., c., j. and k. bclow (the
"Continuing Cundi[iuus") shall cuntinue us conditions �uztil Clusing, ai�d there shall have beeu
no material adveise change to any of lhe otl�er cunditions �rior to Closing, Costco shall providc
to CitylSucccssor Agency a separale waiver noticc lor condition 205.1(g) (�� "F'inancing Waiver
Notice"), whoncvcr thc City is rcquircd to commit to a Pinai�cing Mechanism as provided in
Section 302,i, n��d, �hc waivcr or apprwal shall uot bc unrcasonably willihcld or delayed;
provided, however, any oF the following Cosico conditio�ts rhat have not been satisfied or waived
by Costco (in its sole and absolute discre�ion cxcepl as olherwise expressly provided below) shall
continuc �s a condition to Costco's obligations hcrcundcr, including, witliout limiteition, witlt
respeci to any ubligation to make payments under the Financing Mechanism. City ad<nowledges
that if it cummits to the Pinancing Mechanism hefore ('�isico issues the (ieneral Waiver Nolice
as to a/! of the follo�vin� condilions, City shall bc at risk ol� beariug ohli��tions uncier tlie
Pintmcin� Mcchtmism ���illiout coniribution fl'om Coslco pr applic�tion of any snlcs taxcs
gencrated by Custco. Costco's remeilies Ior faifure of any of tl�ese conditio��s sliall be �s
�xovidcd in Scction �05.1 .
a. There sheill have h�cn no material advetse change Co the physical
or title coiiditioiis oC thc Sile, and the Si�e and its title remain in si�bstantinlly the condition
approved by Costco prior lu its execution of this Agreement;
b. City l�as approvcd Costco's consu�uction plans an�l design
development cirawings tbr the improvemei�t; on thc Site and I��s notified Costco th�it the building
pein�it(s) necessa�y for developmenl ol the Site maiy be issued, subject only to applicablc fees;
a Costco h�is obtaincd or received all approvuls requircd under the
Caliluri�ia h;nvironmcnlal Qualily ilcl ("C'CQA") an�l ai�y a��d nll uther govcrnmental
cntitlements and approval.e required tin� the development, conslruction and operation of the Site �
as a� Coslco warehousc slore, all conditious oY wlzich enliUemeizts and approvals and afl
rcqttirements tbr on-site and off-site improvcments or services, in-licu fees or pt�yments,
�c�liealiou or reseivation requircmcnis, watcr ri�hls acquisitiun eosls, I�cal improvcinenl �listriel
covts, conncclion chargcs, �3sscssmcnts, mitigation f'ees, im��act fees, permit Feev and any o�her
similar requirements, lees or chaxg�� imposed hy ai�y goverument�il eutity or utility service
providcr in connection wilh thc approvals shall bc subjccl to Costco's t�l�proval in its sofc and
�ibsolu�e discrction:
d. Costco has obiai�tcd a commitmcnt for an n(:CA policy of titic
insurance acceptable to Cos[co in the full amount of the Yurchase Price:
e. City ancl S�iccessor /�gcncy are nol in malcrial default �mder anv
otl�er pro��ision of tliis Agrcement beyond any applicable curc period. tjnd without limiting the
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generality of tlte foregoing, have obtained or received all a�provals required under CEQA and �
any and all other governmenlal cntiticments and approvals required for the development.
construction and operation of public improvemcnts to be uudertaken by City pursu�nt to Sectiou
lll of the Scope of Devcloprnenl (All�chincnl No. 4) or xs revised wilh lhe approval of CosYCo
and all governmental enti[ies having approval rights over tl�ose revisions (Phe "Yublic
Improvements");
f. �'scrow Agcnt is in posilion, conditioncd only apon Closin�, to
recur�l nn� d�liver to CoSlco the Cully-execuled Lxclusive Use Covenanl, x wpy uf which is
� atlachcd hereto as Attachment�o. 7;
g. City sh�ill have obtained ot received a commitmcnt for Linancing ur �
otherwise shall have pruvided assuranecs to thc reasonable s2tisfaction of Costco tl�at City is
willing and able, both linancially aud function�lly, to undcrtakc 1nd completc thc Public
Improvemen[s set forth in the Scope of Development (Attaclunent No. 4) in accordance witl� tl�c
Schcdule of Pcrformancc (nttachmcnt No. 3);
l�. Successor Agency shall have obtained tinal confirmation, to the
rcasoi�ablc satisfaction of Costco, that Successor Agcncy has all necessary approvals from the
Oversight Bo�rd and the State Department of Pinance to convey the Sitc to Costco as
contcu�platcd by this Agrccmcnt;
i. Costco shall havc received and approved all items and I
d��cumentation providcd in tliis Agrccmcnt to bc dclivcrcd to Costco;
j. Tlie representaliun� and warruntics of Cily and Successoi� Agency
aintaii�ed in this Agrcemcnl shall be nue and correct in alI mt�lerial respccis as of Ihc Closing;
k. Subject to Section 604, no litigation, referendum, moratori�ml,
stalute, ordcr, rcgulntion, ordinancc, legislation, judgmcnt, ruling or dccrce shull have bccu
enacted, adopted, issued or entered. or shall be pending or iu efYect, tl�ai could adversely affect
thc Site, the Approvals far the Pirojcct (as detincd in thc Scope of Development) or Costco's
ability to devclop, construct, open and operate its Projcct in aceordancc wilh Costco's schedttle;
I. l�lic Site shall have been established as a single, legally subdivided i
lot, sepaiatc and �part from any othcr real property, which condition may not be waived, and as a ,
septtrate tax ��arceL
For purposcs oC this Agrccmcnt, including, wilhout limitation, Sections
2U5.1 and 305.2 hereot; approvals shall not be deemed to have bee� "obtained° or"issued" until
fhc period of timc (if 1ny) to contcst or appc�l any such iss�i�ncc has passcd without thc filiug of �
u contesl ur appeal or, iC x contest or uppeal ha5 becu filed, aRer the issutiuce of a finnl and non-
a��pealahlc cn�der, decision or judgment (a °Fin.�l dudgroenf') continning die issuance of lhe
relevant approvals without substantial modilications or conctitions that are imacceptable to
Costco or Citv;
20�.2 Cunditimis for the Benefit of City The following are City's conditions to
conveyancc of die Site:
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a. T'herc has becn no materi<il adverse ch�u�ae in the Financial
condition oC Costco such that Costco r,o longer would have the necesslry equity capiTal for
�icquisitiou aud developmcnt of thc Sitc, as sct forll� in t�hc Scopc of Devclopment, (Attachmcnt
No. 4); and
b. Costco ha.e nhi�iined any and all necessary g�wernmentzil
discrclioi�ary approvals and discretioutiry permit5 requircd for the devclopmcnt, consiruction and
operation of a wurehouse store on the Site, and hus rccciveci or ti�aivcd the condition of receiving
thc building permit and olhcr ministcri<il permits.
c. City shall have obtt�ii�ed or received (i) all approvals required
under CEQn a��d a��y and all other govennnental entiQements and approvals rcquired for thc
clevelopment, constructio❑ and use of thc Public Improvcments and (ii) a commitment for '�
financing or other eonfirmation that City is able. butli fivancially ai�d functionally, to undertakc
and complete the Public Improvcmcnts set Ibrth in the Scope of Develupment (Attachment No.
4) in accordauce witl� the Schedule of Yerformance (Attachment '�lo. 3);
i d. Successor Agency shnll l�ave obtained linal confinnation thnt
Successor A�ency has cill necessaiy approvals tlom the Oversiglit Board and State Departn�ent
of Fi�ance lo convey thc Sile lo Coslco �s cunt�;mplaled by this ngrecmcnC
e. Subjecl to Scction 604, uo li[igation, retereudum, moratorium,
statule, a'dcr. rcgulation, ordinance, legislation, judgment, ruling or decree shall have hcen
cnactcd, acloptcd, issued or entercd, or shall bc pcnding or in cffect, that could advcrscly afibct �
the City�s abilit}� to develop, construct, open and use the Public Lnpruvements iu accordance
with the Schedulc of Verformance;
f. I�hc Site sliall have been cstablished as a single, Icg�lly subdi��ided �
lot, separate and apart ti�om any other rcal property, wliidi conditiou may �ot be H�aived.
206. Cundition oP Title Successor ngency shall convey to Costco fee simple title to
the Site free and clear of all rccordcd liens, encumbrances, assessments, leases and laxes except
as have bcen apE�rovad or waived by Cosico, as follows:
206.1 Title Commitment and Title Policl' By lllc time specilicd i❑ thc
tichcdulc of Performancc. Costco shnll obtain, at City's espcnsc, a currcnt titic convnihnent (the
°Tille Cmnmilmeni") fi>r an owi�u�'s exten�led cevcr�igc policy of tide insurance, on ihe
American I.and 'fitle Associatio�� ("AI,TA") Corm 1402.06 ALTA Owne�'s Policy (6-17-06) (tl�e
"'I'ille Polic3�"), to be issucil by Title Company at ils then ew�'ent staudard r�tcs wilhout any special
prcmium, in an aggregatc amowit of not Icss than tl�c Purchasc Price, with copics of all cxccptions
� �ind encumbranccs to title shown thcroin, coinuiitting '1'itle Cumpany to isauc such 'l'itle Policy to
Custco. Costco shall deliver a co��y of the 'I�itle Commitment lo City. Costco's obligation to
consummate the purchase nnd s�lc hercin ca�templated shall be subjecl to and conditional upon
Costco's reccipt al il�c Closing of the Titic Policy, [ogcthcr with sucl� endorscmcnts ihereto as
Costco shall reasonabll' reyuest, indu�ling, withuul limitatiun, s�irvey, acce�s, separate tas parcel,
tiubdivision, ownci's comprehensivc and contiguity endorsements (or of "I�ille Cnmpury's
� irrevoeablc conunitment to issue the '1'itle Yolicy with requcsicd endorsemcnts). su�ject only lo
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thosc cxccptions expressly approved in writing by Costco, if any, or otherwise expressly deemed to
be approved by Castco I�ereunder, if any (colicetivcly, the "Vermitted P:xceptions'�). '17ie "Citle
Policy shall insure Costco ll�at, upo� consummatio� of the purchase end sale herein contempl�tcd,
� Costco will be vestcd witli good, Icc simplc, markctablc and insin�tible tillc to Ihc Site, subjecT only
lo thc Pennitled Exceplions, and 9uccessor Agency covenants to convey such tiUe to Coslco at the
Closing. Successor Agency agrees to ftirnish Tiile Company with such customa�y affidavits and
indemnities as may bc required by "l�itic Compa��y in order to issue tlie Title Policy as aforesciid,
without any e�ception (or imfilcd and unrccordcd matcrialmen's ancl mechanics' liens and parties in
pusse�sion.
20fiZ Surve� Ry the time specified in the Schedule of Pcrfonuancq Costco
shall obtain, at Costco's expense, an AI:I�n sur�-cy of tl�e Site, dated no earlier than thirty (30)
days prior to the d<ite ol� dclivcry to Costco (the "Survey"), ecrtified to Costco and Title
Cumpany, prepare�l by a surveyur licensed in tl�e st�(c where Ihc Site is lucnled who is selec[ed
hy Costco ("Surveyor"). The Survey shall be in forin and substance sul'(icicnl to permit '1'itle I
Company to issue the "1'itle Policy with only such cxccptions as roay have been approved by '
Costco ns Pennitted L:xceptions). Sur��cyor shall ccrtify to Costco and City and Successor �
ilgeucy thc total mimbcr of us�ble square feet of the Site, nct of�any area that is nol availablc f'or �i
Costco's exdusive use as buildino. tucling facility, ��2rking lot improvements, including, without
limitation, lighting, drivc aislcs, cart corrals, ctu�bs, gutCers, sidewalks �nd typically-required
I�lndscaping. "l�he number ot' square feet certitied shall conclusively cstablish the basis for
determining the Purchase Pricc absent a showing by either party of perceptible mistake ur traud
on thc part of Survcyor. Costco ma��, at Costco's expensa cause the Survcy to be upd�ted (the
"Updated Survcy") no earlicr lhan thirty (30) days prior to the Closing, which Up<lated Survcy
also sh:�ll bc in lorm and substa�ce sutTicient to permit �I�itic Company to issue lhe Title Policy
�vitho�it boundary, encroachmcnt or suivcy exceptious (except to tlie extent that tlie sai�ie have
bccn approved by Costco as Permitted L�ceptions), and to delete from the "Cide Policy the
standard exceptions as to imrecorded e��sements, visible and apparcnt cascments and olher
matters which would be discloscd by an inspection oPtl�c Site.
206.3 Review uf'Title Commitmcnt and Survev Costco sliall have until 5:00
p.m. lucal lime in the Uoverning Jurisdiction on thc date lhat is the end of the time period
specified in the Schedule of Performance (tlie '°I'itle Inspection Periocl") lo review and �
commcnt on the exceptions and matters containcd in or disclosed by the Title Commitmenr and
Siu�vey. Costco sh�ll bc entiticd, in its sole and absolute discretion, to terminate this A�reemcnt
if Cos[w ubjects to zmy ol the mtrtters diticlused by the l�iUe Commitment or Survey (each_ an
"nbjection" and collectively, the "Objeetions"). In addition, Costco shal] be entitled, in its sole
dnd absolute discretion, to condition its acquisitio❑ oF the Site upon the Successor Agency's I
rcicasc, dischargc or rcmoval of cach Objcction prior to lhc Closing Datc, and the dcletion of i
eacli Objeclion t}om tl�e Tille Pulicy lo bc issued al tlie ClusinK. Priur tu the expiralion of the !
I'itle Tnspccli�'m Period, Costco shall provide written notice lo City (the "Objection Notice"� of I
each Objection which Loslco rcquires to be releasecl, discharged or removcd prior to the Closing
Date. Any matters revcaled by the Tide Commitmcnt tmd/or Survcy to which Costco does not
object before the end of the "I'iUc Inspectiun Period sh�dl be �leemcQ �o be Permitled F,xceptions.
Pollowing Costco's initial title examination, Costco shall have until the Closing Date to reexamine
title to the Site and to give Suceessor !\gency notice of any additional Objections (olher than the i
, Pennitted h;xceptions previously approved by Costco) discloscd by such rccxamination and which
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were nol filccl and inclexcd of record as ol' Ihe date of the initial examination or not otherwise
rcllectcd in tlle 'I'itle Commitmcnt. In addition. Gostco shall have the right to object, in the same
ma�mer set forth herein, to an}� matter shown on the Updated Survey not previously shown on the
� prclimii�a�y Survcy or �pprovcd as � Pcrmittcd Gxccption by Costco.
, . • .
, 206.d Citv s R��hl lo Cure '1'ille Obie���ons If Costco raiscs any Objcclions in
� accordance �vith the proceciures of Sectio�� 206.3 o('this Agreement. then Successor Agency shall
have ten (Ill) days after the reccipt of the Objcction Notice to givc Costco �w�itten notice either
Ihat (i) Successor Agcncy sliali rcmovc any O'ojcctions prior to thc Closing at no cost m Costco,
and Successor Agency shall prontptly provide Costco with evidence satislactory to Costco oY
Successor Agency's ahility to so remove such Objections; or (ii) Successor Agency elects not to �I
cause such Objections to be removed. If Successor Agency fails to respond to lhe Objection
Notice, Successor Agency shall bc deemed to havc agreed to cause all of thc Objections sct forth �
, in the Objection No�ice to be removed ai or beYore tl�e Closii�; Date. If Successor Agency gives
Costco nolice under clause (ii), then Costco may either waive thosc (lhjcctions which Successor
Agency has etectcd not to remo��c, in wliich evenr the �-vtiived Ubjections shall be deemed to be
Permitted C;xceptions and this Agreemenl shall continuc in full Corcc and effect, or termina[c this I
Agreemenl by nolicc dclivcred to City/Successor Agency on or before the Closing Date. Il; by i
the Closing Date, Costco fails to respond to Suceessor/�gcncy's election to proceed under clause i
(ii). then C:ostco shall bc deemed to have tenninated this Agreement, and lhc l)eposit shall bc
rctw�ned to Coslco. ,
' 2U6.5 Monetary I�,ncumbrances "fhc phrase "Monetary Cncumbrances" as '
uscd herein mcans cncwnbrances or deYects to tide which by their tenns requirc lhe payment of
maiey (in an ascertainable amotmt), whethcr in inslallments or at a lixed time or otherwise,
including, without limitntion, mortgages, deeds of trust, medtanic's or materialmen's licns, and
licns nssociated with public improvement ciistricts and special asscssmenis. Notwithsfanding
a��ylhing hereit� lo tl�e cantrary, Successor Agency shall nol have Uie right tm�l�r Section 206.4 to
cicct not to cure any Monetary F.ncumbrances affectiug title to the Site. Succe�ssor Agency
covenants to rcmove all N1ouetary Gncumbrances prior to or at the Closing.
2U6.6 Titic Fccs In tlie cvcnt this ,�lgrccmcnt is tcemina[cd pursuan[ to lhis
Section 20G or any othcr provisiun of t6is Agreement uther tlian by reason uf x default by any
�iarty under this Agreement, any cancellation I�ce or otha� costs oCl'itle Comp�ny shall he borne
in equal shares by thc parties. In thc cvent this Agreement is termin�ited pui:suanl to this Section
, 206 or any other provisiun of this l�grecmcnt by rcison ot a default by any party tmder this
ngreemcnt. �nv canccllation fcc or otl�er costs of Title Company shull be borne by Uic dcfaulting
�iarty.
207. Time fa• and Place of Ueliverv of lleed �nd ('IosinL� Uocuments Subject to
any mutually a�reed upon extcnsions of timc aud to tlie provisions of Sections 215 and 604,
Successor Agcncy shall deposit with tl�e Csa�ow ngcnt by thc �imc spccitied in tl�e Schedtdc of
I'erforma��ce the follo��ing:
� a. Grant llecd. The Grant Deed conveying to Costco iee title to thc Site
subject to no encumbrances or defects except �or thc licn oi'real properiy taxes for tlie current �
ycar proratcd to thc Closing llatc and thc Pcnuittcd F�ccptions.
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b. I�IRPTA Ceititicate. A ccrtil�calc ot��onforeign statt�s and of partnership
or California residency/permanent place of business status in form rcquired by lederal income
tax regtilations aud the California Reve�ue and �l�axalion Code and reasontibly acceptablc to
Costco. In the evenl Succcssor Agei�cy does not deliver such certifictrtc to Costco at the Closing
or docs not otherwise sufficienlly evidenec Succcssor Agency's exemption (�ram witlil�olding
requirements, Costco may withhold such amounts as may be required imder tipplicable law in
order for Costeo to avoid any liability for Successor Agency's tas obligations.
c. Authority Documcnts. Certi�icalcs, duly adopted resolutions, incumbency
ccrtiticatcs, good standing certiticatcs and othcr e��idcncc satisfacto�y to 'Citic Company of the
�uthorization uf lhe sale uf the Si�c to Coslco ancl of lhe authority ol�lhe persun(s) esecutin� and
dclivering documents ��t the Closing ai beh�ilf of Successor Agency.
d. Successor t� ��ency's Ca�liticatc. A cerlificate cerlifyin, that cach and
cvery warrunty and representation made by Successor /lgency in tl�is Agrcement is truc and
correct in all material respects as of the CIi�Sing as if inacie by Successor Agency at such tin7e,
cxcept as shall have hcen discloscd to and waived by Cnsico in w�ritin�.
e. Owners Aftidavit An a(Tidavit in form satislactory to 'l�itle Company for
lhe issunnce of thc 'I'itle Policy without exception (or mechanics', materialmen's or odicr
statuta'y liens, parties in possessiun and other standard title esceptiuns.
f. Closi�t� Stt�teinei�t. A closing statemeiit setting foilh in rcasonable detail
the financi�il transaction conlemplated by lhis Agrecment, including, withoul limitation, the
Purchase Price, all prorations, Lhe 211oca[ion of costs spccil�icd herein and the sotu�ce, applicltion �
aiid disbursc�nent of all funds (the "ClosinK Stateinent").
g. Declaratiun _pf I;xclusi��c Usc. f'l�e llcclaration of h;xclusive Use �
(Attaclvrocnt No. 7) in rccordablc frn�m. ��
h. Memorandum ol A�rccmcnt. A Memorandum ol Agreement in the Yorm
of Attachment No. 8 herctq to be recorded at Closing to give public notice of certain provisions
of tltis Agreement that shall survivc Closing for specificd periods.
i. Additional Documents. Copies of all oUier survcys, pinns and i
specifications, permits and approvails aud other similar documents which pe�rtain to the Site
and/or the Project Approvals which may° be in the possession of ihc Citv or ihe Successor j
/�gency or under tl�eir control. �i
j. Miscellwleous. Such other itema. �ocumenls, affidevils, real property ��
transfer tax retwns, lega] opinions, instrumcros and cortificatcs as Costco reasonably requires or
1s may be necessary or dcsirable to consummate the saale of the Site and to induce"Citle Company
to issuc thc "I�iUc Policy. including, if applicuble, documcntation to cCicctuatc Costco's ]031 �
exchange.
�, 208. Payment of the Purchasc Pricc and Rccordation of Decd Within the time
� specified in the Schedule of Yerformanee, C'ostco shall dcposil lhc I'w�chase Price (or the Sile
and otl�er sums rcquired hcre�mder witli the I�;scrow Agci�t prior t'o the date for convcyai�ce �
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thcreof, pro��idcd lhat the Tscrow Agcnt sh�ll havc notilicd Costco in writin� [hat tfic Successor
Agency has depusited with Gscrow Agenl xll uf tl�c clusing �luciunenls tu be depo�ited by
Successor /�gcncy pursuaut to Sectiou 207, including, without fimitation, the C;ramt Deed,
properly executed and acknowledged by Sucecssor Agency, and lhat titic is in condition Lo bc �
conacycd in conlormily wi�h thc provisio��s of Section 206 of this Agrecme��t Upon the
Closing, tl�e Escrow' Agent shall file the Grant Dce�l for recorda�iuu among tl�c land records in
, Ihe Office of the County fZecorder ol' Mendocino Cotmly, sl�all deliver the Purchasc Yrice ai�d
other required sums to Successor [lgcncy and shall deliver to Costco a tide insurance policy
insuring title in conformity with Scclion 209 of this Agrccmcnt.
209. Titic Insurxnce Costco shall obtain and dclivcr thc Survcy Lo "l�itic Company and
Bscrow G�gent so as to permit Title Company to issue the title policy m Costco in accordance
with this Section 209, witl�out the inclusion of a survcy exccption. Concurrently witl� �
recordution of the C'�rant Decd, F,scrow Agcnt shall providc �nd dcliver to Costco a tide insurance
policy issucd by the "I�itle Company insu,ing that ti11c is vestcd in Costco in thc condition
required by Section 206 nf this Agreement. 'I'he 'I�itle Company shall provide Successor A�eocy �
� �vith � copy of the title insurancc polic��, aud the title insurance policy sliall be in tl�e �mount of
ihc Purchlsc Price ol thc Site Successor Agency sh�ll pny for th�t portion of thc tiUe insurancc �
premium �ttributable to an A.L.T.A. standard owncrs form policy of tide insurauce in the amuunt
of the Purchase Pcice of thc Site and for a�ry endorsemen�s acceptnble to Costco to remove or �
insure over exccptions that are no[ Permitted F:xceplions. Coslco shall pay for all other
I premiums for title insurance co�-erace or ,pccial endorsements.
210. T�xes and Assessmcnts Ad ��alorem taxes and asscssmeuts on the Site, if any,
and taxes upon this Agrccn�cn� or �m�� rights hereuiider, levied, assessed or imposcd for any
period commencing prior to cunveyance of litle shall be borne by Successor Agency. All sudi
ad valorcni taxes �nd assessments Icvicd or imposed f'or any period commcncing al�tcr clusing of
thc cscraw and �pprovtd by Costco 2s Pcnnit�cd Gxccptions shall be paid by Costca tAny
ussessmunls oC recor�l agaiust �he Site but not included timonb U�c Permilled h:xecplions shall he
paid in flill hy Successor Agency on or bcfore Closing.
21 L Convevance Free of Possession l�he Site shall be conveyed free of any
possession or righl of possession by any pci:son cxcc��l thal of Costco aitd the eascmcnts of
record.
212. Insnections
212.1 Insncetions Costco has conducted a Phase 1 Lmironmeutal �tudy and
� Soils .Analysis of Uie Site and is satisficd with Ihe condition of the Site as ol the datc Costco has
c�ccutcd this Agrccment Costco �grccs it will rely solcl�� on its own investigation of Ihc Site in
it� current physicxl conditiun, and, except as in tl�is Agreement olherwise speciYtcally provided,
wit'h no warrantics, exprass or implie�d, as to ihe phVsical condition thercof, tl�e preseuce or
� absence of� an}� latent or patent condition Uiereon or thereiu, including, without limita�ion. any
I farardous Matcrials (as dc(ined hercin) thercon or thcrcin and any othcr matlers aff'ecting the
Sitc.
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212.2 Indemnitics
a. Indemnitication by Costco. Costco indemnifies and agrees to
dcfend und hold harmless City and Sucecssor ngency and their successors and assigns from and
agaiust �ny and all claims, expenses, costs, damages, losses and Iiabilities (ii�cluding reasouable
attorneys' fees) that �ua� at any timc bc �sscrted against or suffered by Ciry or Successor Agency
(and/or Lheir successors and/or assigns) as a result oC, on account of or arising from any
obligation, claim, suit. liability, contract, aoreement, debt, encumbrance, or c��vironmental or
physical condition of the Site, first crcated, arising or aceruing afrer tl�e Closing Datc rclatiug to
thc Sile or its operations, except to tlie exlent that such liabilit�� arisc5 by. throttgh er under City
or Suecessc�r Agcncy.
6. Indemniticatiou bti� Successor /��en�. Except as provided in
Section 212.1, Successor ilgcncy indemnihcs �nd agrecs to detend and hold hv�mless Costco ���
aud its succrssors and assigns t�rom tirid xgains( any and all clxims, expenses, costs, damaoes, I
losses and liabilities (including reasonahle attorneys' fees) that may at any time be asscrted �
againsl or sut3ered by Costco (and/or its successors and/or assigns) or the Site, or any part
thereof, whcthcr bcfore or allcr thc Closing Datc, as a result of. on accutmt of or arising fi-om (i) I
any breac6 of ai�y cuvenant, representziliu�, w�u�ranty ur agrecmenl on lhe part of Successor
Age��cy fo Cosicn made hercin or in any instrument or docmnent dclivcrcd �ursuant ro this �I
ngreement, and/or (ii) any obligation, claim, suit, liability, contract, agreeme�it, debt,
encumbranec, oe cnvironmcntal or ph}'sical condition of the Site, crca[ed, axising or aceruing on �
ur prior to the Closing llatc, regardlesti ol when tisserted, rclaling to tl�c Sile ur its operations
(including without limitation. any and all liabilitics, includiug pen�lties, for federal or state
income taxes or other taxes, wliich are not assumed by Costco in writing), cxccpt to lhe extent
tliat such liability ariscs by, through or under Costco.
213. Condition of Ihe Site; Feasibilitv Period L;xcept as may 6e � otherwise
specifically providcd in this Agrccmcnt. indudin�, H�ithout limitatiou, in tl�e Scope of
Development (Attachment Nu. �4), thc Sitc shall be convcycd from Succcssor Agency to Coslco
in �n "as is" conditiun. Cit�� shall not be responsible for any iteins of site work excepl lhose tliat
are listed in the Scope of fJevelnpment as City's responsibiliiics.
Costco hcretoforc hus inspecled and appro��ed, and bctween the date of this Agrecment
and the cl�te of recordation of the Grant Deed may contiuue, at Costco's sole ex��ense, to inspect
t2n� any material advcrsc changes subscqucnt to sucl� approval, ihe soil conditions of UZe Site and
the suilabilit}� of such soil conditions ti�r the improvements to be constructed b�� Costco.
During dic teim of this ngrccment prior to lhc conveyance of the Site to Costco,
rcpresentatives of Costco shall have (i) access to all data and inti�rmatio�i on thc Sitc available to
City, but wilhout wananty or represcntxtion by City as lo the completeness, correctness or
validity uf such datu and information, and (ii) ihe right of access to tlte Sitc at all rcasonahle
times for the purpose of oblaining dala �nd making survc��s and tests nccessaiy to carry o�n this
Agreemcnt. CosCCO shall indcmnify, dcfend and hold City and Successor Agency harmless fron�
any injury, liability, cost or damagc5 arisin� out of any xcLivily pursuant lo Lhis section.
Notwithstanding the foregoin� hold liarmless agrecment, Costco shall have no liability to City,
� the Successor Agencl' o�' lo any other person or entity by reason of, nor shall Costco have any
duty to iudemnify, defend or hold any persou or entity harmlcss I�ran or against, any liens,
12
I
claims, losses or liabililics (collectively, "Costs"), including, without limittuiun, any claim �or
diminution in value of the Site or for ei�vironmental remediation or cican-iip costs, arising out of
or in connection with the mcre lact of having discovered and/or reported (as may be required by
law) any advcrsc physical condition, titic condition, cnvironmcntal condition or othcr dcfcct with
respect to tl�a Site. Any claim lbr in�lemnilication under this Sectiun 213 musl be maele within
one (I) year af'tcr the date of Clo�ing or icrmination of this ngreement. Any �reliminary work
undertaken on tlic Site by Costco prior to conveyence oY title thereto shnll be done only afrer
writtcn conscnt of Succcssa� Agcncy and City 1nd at tlic solc capcnsc of Costca Copics of datzi,
swveys and tests obtaiued or made by Costcu un lhe Site shall be file� with Ciry. Any
prclimin2ry work by C��slco shall be underial<en unl}� alter securing �my necessary permits from
the appropriate guvernmental agencies.
214. Rcnrescntutions, Warrantics :�nd ('ovcnants
21d.1 Citv's ReD�'esenta[iuns, Wau�ranties und Covenants. Gity represents,
warrants and covenants to Costco: �
(i) Powcr and iluthoritv. City is a numic-ipal coiporation, in good
standing, duly tbrmed and validly existing unctcr the laws oCthe Slatc of California. Successor
Agency is a separate Icg1I entity and lhe successor to the I2DA. City aind Successor A�ency have
lhe authurity and power �o e�ter intu this Agreement and have, or by the end uC the �ime period
specified in the Schedule of PerCormance shall ha�e, all necessary power and authority to
consununatc tl�e transaction provided for herein. This Agreement and all other documents
cxccutcd �md dclivercd by City constitutc lcgal, valid, binding and cnforcc2blc obligations of '
City uncl Succussur Agcncy, �nd lhere are nu claims ur delenses, persunal or utherwise, or offsets �
whntsnever to Ihe enfnrceability nr ���lidiry oF �his Agreement. l�he persa�s cxecuting tliis �
Agreement on beltali oY City and ihe Successor Agency have bcen duly authorized to do so. �
(ii) No Violatious or Actions. �I'he cxecution, dclivery and
perTonnance by City and Successor ilgency of their obli��ations under tliis Agreentent will not I
conflict with or restdt in a breach of any la�v, government�l rule, regulation,judgmenl, decrce or �
order by which City, the Successor /lgcncy or thc Site is bound, or any conII'xct to which City or �
Sucecssor ngency is a �aariy or by which City, Successor ngency or the Site is bound. �fhcrc is
no acliun, suit, proceeding or investigation pending, or, to lhc kno��ledge of the City or thc
Succcssor �gency thal may be threatened, before any agency, court rn� nlhcr govcrnmen[al
authority which relares to the Site or thc usc tl�crcol; exccpt lor legal challenges under the CGQA �
or �he Ciry's roning ordinance or General Ylan that may be hled ro challcngc approval of thc
e�titlemeuts required by Cos[co to fully per(orm under this Agrccment, wl�ich are subject to
Sections 205.1 and 205.2.
(iii) Condcutnntion; Moratorium. Therc are no condemnation or
eminent domain proccedings pc��ding, or to City's knowledge threaCened or co�templated,
against die Sitc or any part thereof, and City lias not receivcd any notice, oral or writtcn, of thc
�esire uf any public authority or ulher enlity to take or usc the Site ur tmy part thereof. City shall �
give Cosico prompt written notice of any actual, or if known to City any threatened or
contemplated, condemnation or eminent domain proceeding against any �art of the Si[e. No
morotorium, staWtc, ordcr, rcg�dation, a�dinance, Icgislation. ,judgmcnt, ruling or dccrcc of any '
13
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court or govcrnmental agency has bcen enacted, adopted, issued, entercd or is pcndin� or in
cffect that could matcrially and advcrsely affect the Site and/or Coslcds ability to develop, opcn
tiu�l opeaile lhe ProjecL
(iv) Contpliance. Upo❑ the Closing, the Site will compl�� with all
applic�ble govcrnmental re�uirements in respcet of the use, occupation and constructioii ihereoC,
including, without limitntion, cnvirontt�ental, zoning, platting and other land usc requirements,
and City and Successor Agency have received no notice of and h�ve no knowledge of any
��iolations or im-estigations relating thcreto. 'I�herc is no deiault or brcach by City wider any
covcnant, condition, restriction, right-oY=way or easement wl�ich tnay affect the Sitc or any
portion thereol�.
(��) Zonim= and Use. No part ol the Sitc is subject [o any building or
use restriction which will reslricl or pruvent the co��templated �ise of thc Sile fur the ProjecL �I he
Site is currently zoned PD — Airport Industrial Park/ Industrial / Auto Commercial and l.igh[
Manufacturing / Mixcd-Use and upou tl�e Closing �vill be zoned Retail Co�umercial. 7�he Site is
not locatcd in any conscrvation or historic district. i�o baildings or othcr improvements of any �
kind encroach on thc Sitc. I�
(vi) Uiilities. Gas, electric power, sanitary and storm se�ver, telephone
and water service and facilities and all other utilitics necessar}' i�ir Coslco's intcnded
dcvelopmcnl, usc and operation of ihc Sitc urc, or by thc Closing ���ill be, available lo and
seivicing the Site in quaiilities satist<ictory to seivice tlic Sitc for thc intended use. Costco inay
cnnnect with all such utilities by the payment of normal ta}�-un or connec(ion Cecs. No condition I
exists whicl� would restdt in discontinuation of necessary sewcr, water, electric, gas, tclephone or
othcr utilitics.
(vii) W�>rk. No work has heen perlormed or is iu progress at, a��d no
matcrials h2��e hecn furnislied to, the Site which liavc not been paid fm� or N�ill not be paid for in
tull by City prior to thc Closing Date. �
(viii) Assessu�ents. No special or general assessments have been levicd,
other thai� �s shown in the Title Commitment, or to thc knowledge of thc City or dic Successor �
Agcncy are thre�tened, againsl all or any pxr[ uf the Site.
(ix) Access and Su�ect Dedication. The streets, roads, highways and '�
avenues i�� front of or ad.joining any p��rt of the Site have bccn dedicated to and accepted by thc
pruper govcrnmcntal authoeity and such governmental atithority has the responsibility to �
n�aiutai❑ such slrccts, ruads, highways ur avenues. "fhe right of ingress ai�d egress from [he i
puhlic roadways tn and �i�om ihe Site is not resn�icted or limited in nny manner. No conditiai �
e�ists ���hich wixild result in the termination or impairment of access to thc Sile.
(x) I.eases; Conu�acts; Aare�ements: Oblibalions. There are no lenses
affecling �uy pmt of tlie Site. 'fhere are no management a�*reements, service contracts or other
a�reements .d�fecting the Sitc or die operation nr maii�tenancc� thercuf which will be binding upon
Costco after the Closing. Tl�crc are no other obligations in connectio� with the Sile, including,
wi[hout limitation, casemen[s, declarations, us� restrictious or othcr similar agreemeuts, which
14
will be bindiug ttpo❑ Costco alter the Closi�ig, except for those matters which have been
approvcd by Costco as Pcnnittcd Exceptions.
(�i) Porci�n Pcrson or EntilY. City and Successor Agency arc not a
fureign person, nonresident alien, foreig�� cu�poi�aliun, forcign partnership, forcign trust ur
foreign estate, as thnse terms arc delincd in the lntemal Rcvcnuc Codc and the Incomc 7'ax
Regtilatious promtilgated tliereunder. City is cither (n) a partnership as determined in
accordancc wiCh Subchapter K of Chapter I of Subtide A of thc Internal Revenue Code, (B) a ��
residcul ul Califurnia, or (C) a corporation wiCit a peruianent plaee of busincss in Califoruil. �
(xii) Ba�ilc��untev Matters. City and Suceessor Agency have no[ made a �
general assignment for the benelit ol crcditois, filcd any voluntary petitiou in b2nkruptcy or �
suffered the filing of an involuntaiy petition by its crcditors, suii�cred the appointmeitt of a
recciver to takC possession of substantialb all of its 2ssets, suffered the attachmei�t or othcr
judicial seizw�e uf substantially all of its assets, admitted its inability to pay its �lebts as they
come duc or made 1n offer of setllement, cxtension or cumpromise to its creditors gcncrally.
(xiii) M.irkctnble Title. Successor A�ency has, as of the [?ffecTive Datc,
good, markctablc and indefeasible title ro thc Site. Without in any w�ry limiti��g tlic gcnerality of
the foregoina representation, Successor Agency fw�d�er represents and w�rrants to Coslco that
(A) no underslandir.o, aarecmenc (either express or implicd) or masonable expectancy of
agreement with respect to sale, lcasc or other tr�nsfer ol� the Site exists betwecn Successor �
Agency and any lhird party, and (B) Successor Age��cy is in no way restrictcd fl�om negotiating
and c�lering into this Agreement with Custco and selling the Site to Cbstcu.
(xiv) Prevailin���,�c. City tmd the Success�r Agency have not taken
any action in regards tu the Site that would make the Projcct su�jccl to tlie prevailing wage
rcquircmcnts codified iu California Labor Codc sectiot� 1730, et seq.
(sv) Hazardous_Subslances. City and Sticcessor Agency wan'a��l and
rcpresent that, to the extent of thcir knowledbe without any inciependcnt investiaation:
(I) Lhe Silc does not contain, and has not contained, any
H<izardous Substancc:
(ll) ncilhcr Succcssor Agcncy nor any prior owncr, uscr or
occupant of lhe Si�e, has conducted ur authorized �he generatiun, tr,m�portation, storage, I
U'e�tment or dis��osal at or near or Gom the Site�f any I lazarclous Sub�tance: �
(lIl) there is no pending or ihreatcncd, litigation or proceeding
bcl'ore nny com�t or �ny goverumcnlal or administiative ugency iii �viiich uny person or en[ity
nlleges thc prescnce, rcicase, threat oF celease, placeinent on, in or I�rom the Site or any adjacent
��rnperty, nr the generation, transportation, storage, u-eatmcnt or disposal at the Site nr any
adjacent property ol any I lazardous Substance;
(IV) ��cither City nor Succcssnr Agency has received any no[ice
of, and has no actual or constructive knowled�e that, any governmental authoriTy or employee or
agent thereof is investigating, has detcnnined or thrcatens to determine tl�c prescnce ol�, release
IS
or thrcat of rcle��se or placement ou, in or from tlie Sitc or any adj�cent property, or thc ��
genara[ion, transporlation, storage, trcatment or disposal at the Site or any adjaccnt property, of
ai�y I Iazardous Substancc;
(V) there are no actions, communications or agreements
hehveen Cit}� or Successor n�ency and any governmental authority or agency (tederal, state or
local) or any private entity relating in any waq to the remediation, prescnec, release, thrcat of
rdeasc or plucemcnt on, in or from the Site, or the gcncratioii, transport.ition, storage, treatment
ur�ispusal oC any l lazar�lous Substance at or fi�oin tl�e Site;
(VI) the Sitc has been operated in compliance with all
Lnvironmental Laws, all neccssary permits iuider tlie I:nvironmental Laws hxve bcen obtained
Ibr the operations on the Site and nu liability un�cr any F.nvironmcutal Laws has bee� incun�ed
wiUi respect to tlic Sitc; aud �
(VII) there are nu tmderground s�orage lanks locatcd on the Site
and no undergiround stor�ge tanks have been re�uoved Yrom the Site.
Por pw poses ol this ,A�recment, the Iollowing tcrms shall have the
fbllowing mcanings:
(1) "Enrironmental Laws" means all lederal, state and local
environmcn�al, hnzardous waste or substance, health and/or safety laws, rules, statutes,
directives, binding wi'itten interpretations, binding wriltcn policies, ordinances and regulations or
common la�v doctrines issued by emy governmental authorities and in effect as of thc EYfectivc
Unte witli respect to or which othcrwisc pertain to or affect the Site or any portiou thereol, the
usc, ownership, occupancy or oper�ition of the Site or any portion ihereol�, or Purchaser, as same
have been amcudcd, �nodiGed or supplemented fi•om time to time prior to the date of the Closing,
inchidiiig, without limitation, the Comprehensive Gnvironmental IZesponse, Compcnsation and
Liability Acl of 1980 (42 U.S.C. ti 9601 et scq.), the 1[azardous Subst�nces Transportation Act
(4) U.S.C. § 1802 et seq.), the Resource Conseivation and Recove�y Act (42 U.S.C. § 6901 et
seq.), as amendcd by thc Hazardous and Solid Wastes Anxndments of 19R4, the Water Pollu[ion
Control Act (33 U.S.C. � 1251 et seq.), thc Sale Dri�il:ing w'atci' nct (42 U.S.C. § 300f et seq.),
the Clean nir Act (42 L?.S.C. § 7401 et seq.), thc Sofid W�ste DisF�osal Act (42 U.S.C. § 6901 et
seq.), the Toxic Stibstances Coutrol Act(15 U.SC. § 3G01 et seq.l, lhe 1?mergcncy Planning and
Community Right-to-Know Acl of 1986 (42 U.SC § f 1001 et seq.), the Radon and Indoor Air
Quality Research Act (42 U.S.C. § 7401 ��otc, cl scq.), the Super�lmd Amendment
ReauUiorization nct of 198G (42 LI.$.C. ��' 9601 et sey.), the N�itional Gnvironmental Policy Act
(42 U.S.C. § 4321 et seq.), the Clean Water Act (33 U.S.C. § 1321 ct seq.l, and thc Occupational
Safety and l lealth Aci (29 U.S.0 � 651 et seq.), comparaible state and local laws, and any and all
rules aud regulations which havc bccome cl'Icclivc prior to the date of the Closing wider any .�nd
all of the aforementioned la��s. �
(fI) "Hazardous Substances" mcans all (1) clectromagnetic
waves, urea formaldehyde loam insulntion nnd traus{brme�s or other eyuipment tl�at contains
dielectric lluid containing polychlorinatcd biphcnyls, (2) any solid, liquid, gaseous or thermal
wnlaminant, ii�cluding without limilatiou, smoke, vapin�, suut, fumes, acids, alkalis, chemicals, �
IG '
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wastc, petrolcwn products or byproducts or fractions thcreof, asbcstos, asbcstos containing
materials, radioactivc materials, YCBs, phosphates, Icad or other heavy mefals, chlorine, mold,
radon gas and any indoor air contamin.mt, (3) any solid m� liquid w�isics (including hnzardous
wastes), hazardous air pollulanU, hazardous substanccs, hazardous chemical substauces and
mixtw�es, toxic substances, pollutants and coutaminants, as sucl� lenns �re delined in any
�nvironment�l Law, and (4) any olhcr chemical, matcrial or subslancc, lhc use or presence of
which, or cxposw�c to the use or presence of whicl�, is }�rohibited, limited or regulatect by any
Enviroiuneat�il Le�ws.
(xvi) Misrepresentation and Adverse Eacts. Cily and Successor Agency ��
have have not knowiugly failed to disclose auy f�ict that is material to die trunsaclion ���
coi�templated in this AFreement that is cither known by City or not reasonably asceriainabfe by �
Costco.
214.2 Custcds Representatiuns, Warrantics and Coven:ints. Costco
represents, warranls and covenants to City and Suceessor Agency:
(il Power anil Aulhorilv. Custcu is a corporatiun in �ood slanding,
duly tonned and v��lidly eristing under thc laws of Ihe St�le of� Washington. Cosieo has the
authority and po�ver to enter into this Agreeme��t aud to cousummate the transaction provided for �
hcrcin. 'l�l�is A��ccmcnl and all othcr documcnts cxccutcd and dclivcrcd by Costco constitute
legtil, vtilitl, biiiding and enfurce�ble obligxtions uf Custco, a��d there are no claims ur defenses,
personal or othcrwisc, or ofl�sets whatsocver lo thc enforceability or validity oC this .�greement.
The person e�ecuting tl�is Agrccmeru on beh.�lf of Costco has beeu duly authorized to do so.
(ii) No Violations or Actions. �l�he exectttion, defivery and
pei'formance by Costco of its obligations under this Agreement will i�ot contlict with or resul( in
a hrcach of any law, governmental rule, rcgulation, judgmcnt, dccrec or ordcr by which Co;tco is
bound, or any contract to �vhich Cosico is x party or by wltich Cosico is bound, or Coslco's
certificnle of incorpocation or bylaws.
214.3 Stu-vival. All of the representations, warrnnties and covenants of
City/Successor Agency and Costco containetl in Uiis n�reement shall be lrue ai�d correct as of�
the Ef�ective Date <md sh�ll. as a condition to Closing. be true and correct in all material respects
as of the Closing Dale. The parties' rigl�ts to enForce such icpresentations, warrnnties sind
covenants shall survivc thc Closing and s�ich rights lo enlorce shall not be me�ged into any
documents delivered at the Closing. It is expressl�� agreed and underslood thxt no cxaminatio�� or
investigation of the Site hy or on hehalf of Costco prior to the Closing shail in any way modily, i
alYcct or dimii�isl� City's obligations undcr the re�resentations, warrauties, covenants and �
a�rcements contained in t6is Agrecinent.
215. Closina Uale l?x(ension. Nulwithstanding atny pruvisiou of lhis Agreement to
the conh��ry. in the event that Costco is prep.jred to close this transaction �iursuant �o the lerms of
this Agrcement, and if Successor Agency has not fully perlormec'1 its obligalions hereundcr, then
Cos[co, in its sole a�d absolutc discrction, �u�d in addition to all other rights and remedies it may
h�ve, may, from time to time, notify Successor tAgeucy that Coslco extends the Closi�ig Date to �
such date or dates as Co�tco may elect to �rovide Successor wiih the additionxl lime necessary
l7
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_ _ _
Iur Succcssa' Agency to fully perfi>nn its ubligatiuns ]urcuuder. In such event, Costco may
defer making Cnslco's Closing delivcries (including deposit of the halancc of thc Purchase Price)
pendiug Sttecessor Agency�s perfonnancc. Successor Agency's failtue to fully perform by such
cxtended Closi�ig Datc(s) shall constitute a def2ult by Successor ilgency tuider this Agreement.
216. Post-Closin�; Adiustments. 'I�hc partics assume there will be no taxes, cosls,
cxpenses ox income at[ribut�ble to tl�e Site to be pro rated betwecn thcin al Closing. 'I'o the
extcnt this assumptioi� may be incorrcct and pre-Closing iucome or expense items wiTh respect to
the Site ��re re�eived after Closing, Costcu and Successm� wiil. upon a proper accountin�, pay to
the oUier such amounls as may be necessary si�ch that Successor Agency will pay all expenses of
the Site lor d�e period on and prior to the Closing D�tc and all other cxpcnscs to be paid by
tiuccessor Agency pursuant [o lhis Agreement, and Costco will pay all expenses of the Site for
tl�c period aftcr the Closing D3te and all other expenses to be paid by Costco pursuant to this i
ngreement. IC either party recei��es any bill or invoice which relates to the period or to an I
expeitse lbr which the uther parly is responsible, the receiving pnrty will rcicr such bil] to thc
responsible party and tlic responsible party �grces to pay, promptly upon rec�eipt such poriion of
tl�e bill or invoicc as relales to thc period or expense lor which it is responsible. [f the
responsible pa�ty does not pay such bill in � timcly inanner, Ihe recciving party may, at its
oplion, pay such bill ur im�oice �nd ll�e responsible p�u�ly sh<�ll becomc liable lo lhc receiving
party for the full amolint of such payment, togethcr with inte�rest at the rate nf twu percent (2%)
per annum in excess ol�thc Primc Rala 'I�he "Prime Rate" shall be thc ratc announced as such
fi'om time to time by Bank of Americe, N.A. or i(s successor. If tl�ere shall be no such
aimounccd ralc of such bank ur its successor, tlien tiie Prime Ralc shall bc such eyuivalcnt rate �s
is charged Yrom time to time hy major money-center hanks.
3U0. DEVL'LOPMI?NT OF 'I'H[; SI'I'E
3111. llcvclopmcnt oi'thc Sitc b�� Custcu
301.1 Scopc of UcveloD�nent Llpon Closc of I?scrow, Costco shall develop the
Site in accord�mce with the Scopc of Development (Attachment No. 4) aud the Site Development
Yermi� issued by the City. Upon completion of development in accorclance with the Scope o(�
llevelopmeut and City's gcncrally-applicablc rcquirements, City shall issuc a Ilnal inspection
notice or cerlilicate of occupaney for the Site (the°Certiticate ot Occupancy").
301.2 Cily Approval uf Pl:�ns, Dr,�wina� and Kelaled Uucwnenls City
ha�et�fore has rcviewed and apProved ('nstc�i's 2rchitecttu'al and landscaping �ilans and
spacilications ti�r development of the Site. I� Costco desires to make anv substantial chan�e to
ihosc plans and spccifications, Costco sh�ill submit tl�c proposed changc to City ior its �pproval.
If the consu�uction plans, as moditic�l by thc proposeJ cl�angc, conform to the reyuirements of
Sectinn 301.1 of this Agreement, the a��rovnls �xevinusly granted by City iinder this
Sectiou 301.2 and the Scope oC llevclopment (Attachment No. 4), and subjcct to Section City
shall approve llie proposed change and notify Costco in a•ritiug witliin thirty (_0) days after
submission to Ciry. Such change in lhe cunstruclion plans shall, in �tny event, be decmed I
a�iproved by ('iry unless rajected, in whole or in p�ut, by written notice [hereof by City m Costco
setting forth in detlil thc reasons therelor, and such rcjection shall be madc wilhin said thirty �
('30) day period.
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301.3 Cost nf Construction Thc cost of dcvcloping thc Site �nd consu•ucting �ll
improvements thcreon sh�Il be borne by Costco, except for work expressly set forili in this
Agreement to be per�i�rmcd or paid lor bq City or othcrs. City and Costco shall each pa}� thc
cosls necessaiy to administer and carry out their respective responsibilities and obligatioi�s under
this Flgreement.
30Ld Construction Schedule Cosuo shall begin ai�d complete all construction
and development ol the Sitc within tl�c timcs spccilied in thc Schcdulc of Performancc ,
(Attaclunent No. 3) or sucli reasonable extension of suid dates as may be grauted by City or as
provided in Section 604 of this ilgreemenL 'fhe Schedulc of Perlormance is subject to revision
fram time to time as muttially agreed upon in writing between Costco �nd the City Manager on �
behalf of Gity. During the period of consu�uction, but uot more frequcnUy than oncc a month, �
Costco shall submit to City a writtcn progress repurt uf the construction wllen and as requested
by City. The repor� shall be in such lorm ai�d dct:iil �s may reasonably be required by City and
shall iududc a rcasonable number of consvuction ��holographs t��ken since the last report
submitted by Castco.
301.5 13odilv Ininrti�, YropertV Uaroa�e �nd Workers' Comnensation
Insurance Prior W tt�e conunencemznt of coustruction on ll�e Sile ur a�y por[ion lirereol�, Castco
or any cnnu'actor or othcr pers�n or entity acting �in hehalf of or under ihe direction of Costco (a �
"Costco Ilepresentativc"), shall liu�nish or causc to bc furnished lo City duplicate originals or
appropriate certilicatcs of bodily injury and property dtimage insurance policies in the amowit of
at least ONF, MII.LION DOLI,iARS ($1,000,000) for any persun, FIVF. MII.I,ION DOLLARS �
($5,000,000) tbr any occun�ence and PIV� HUNDR�D THOUSAND DOi,1,ARS ($500,000)
�ropei�t�� damagc, namiiie City as an addilional insured. IF a Costco Kcpresentative provides a
certiticate of inswunce (and any policy cndo�sement tliat may be rcquiied to efFect coveragc of
City us ail additional insured) in satisfacCion of the insw�ance requirements of dlis Section 301.5, I
then insw�ance Costco may carry shall bc in addition io and secondary and non-contributing to �
any covcrage provided b}� the Costco Representative. Costco or a Costco Representative shall
ulso f'urnish or cause to be Cw nishcd to Cily cvidence satisfactoiy to City that uny contructor with
whom it l�as contracted for the perti�rmairee of work oi� the Sire carries workers' compe��sation
insm<jnce as required by law. �fhc obligations set forth in this Section 301.5 shall remain in
ettect only until issuance of the Certilicate of Occupancy. In satisfaction of the foregoiug, ��
Costco maintpins insurance meetiiig the minimum titandards set forth in Costco's ciirrent
Memorandum of Insw�ance as postcd at www.m�ish.com/moi?clicnt=0847. Said memor�udum �
and any substitutes or replacements thereof also shall co��er City as an additional insumd, but
shall be sccondary and non-conlribating to any covcra�� providcd by a Costco Re�presentative.
301.6 Cih� :�nd Other Gu�'crn�uental Permits I3efore commencemcnt of I
construction or develo��ment of any buildings, structures or otha• work of improvement upon the
Site, Coslcu sh�lf, al ils own expense, sccurc ur cause tu be sccured euy and all pcnnita Ihat may
be required by City or airy nther governme�tal entity �iffected by such construction, developmcnt
or work Cily shall provide all �ssistance deemed appropriate by City lo Costco in securing these
permi[s.
301.7 Ri�hts of Acccss Pur thc purposes of assuring compliai�cc with tliis
Agrecment, representatives ol'City thall have the reasonablc right of access lo the Site during the
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period of construction, withou� chargcs or Ices, during normal construction liours, and upon at
least one business day advance �iotice to Costco, for the E�urpuses of this Agreement, includi��g,
but not limitcd �o, thc inspcction of thc ��vork being performed in constructing thc improvcments.
Such representatives of City shxll be tln�se who are su idenlifed in writiug by the City Manager
nf City. Keprescntatives of Cnstco shall hc cntillcd lo accom��any City re��rescntatives at the
times that City exereiscs this right of access. Ciry shall indenuiity Costco and hold it harniless
from any damagc causcd or liability arising otrt of this righl to �cccss. 'Chis is ii� addition to tl�e
City's uunnal rcquirements lur i��specting work performed pursutmt to a Buildiug Permit,
including ins�icclions hy thc Cily's l;uilding OIticiul.
301.8 Loc�l, State :ind Federal La�cs Costco shall carry out thc consU'uction of
lhe improvemcnls in con�brn�ity with all applia�ble laws, including all applicable federal and
state labor s[andards.
301.9 Antidiscrimination Diu'inz Construction Costco, for itself and its
successors and assians, agrees that in the construction of the improvemcnts provided for in this
Agreemcnl, Costco will not discriminatc agaiust auy employce or applictnt Yor employment
because of race, color. creed, religion, sex, marital status, ancestry or uatioual ori;in. �
302. Rcsnunsibililics uf Cilv: Finnncin�Mechanism.
302.1 Construction of Public lmn�'��vements. City, wi[hotit e�xpensc ro Costco
or assessment or claim ag�iust the Site, exccpt to lhe cxtent funds Irom the generally-applicable,
Airpori lndustrial P2rk Capital Improvcmcnt Fccs may bc uscd for thc Public Improvcments,
shall pei'Jorm all work spccified lierein and in the Scope of Developtne�ri (nttachtncnt No. 4) for
City to peri'orm, including, withoin Iimitalion. lhc Public Impravements, within the tiines
speciYied in the Schedule o1�Performance (flllachmcnt No. 3).
302.2 Contract fur Construction of Puhlic Improvcments. 'I�hc contrac[ for �
the construction of the Public lmpro��ements will consis� of the City's sttmdard construction �
contraet, projeet specitications including the project specific specill provisions. an enm•oachment �,
pennit from tlie Ctdiforni� Depaitment ol'I�r�msportalion ("Cal �Crans°) for work ��uitl�in die Cal I
Cr�ns ri�ht of way, and thc pr�jcct plans (collectively, the "Constrtwtion ContracY') nnd will 'I
be developed in accordance with the Caliiornia Public ConU'act Codc. �Chc Construction Coniract �
will include, witl�out limitation, the provisions covcring the following:
a. Subcontract Rcquirements. Primc coutrc�ctor to ens�irc
subconh�actors and supplicrs will comply ti�itl� tku Conslruction Contract.
h. Working Day Requiremmlls �I'he Construction Coutract will
include an allocation of working days tbr completion of the Public Improvcmcnts including, but
uot ncccssarily Iimitcd to, working day allocations for milcstoncs within the work. Additional
tlays will be managed by ll�c City in cooperation wilh Custco. The working d'<ry allocations
included in the iiotice inviting hids, reqticsl for qualifications �od request for proposals
(collcctivcly, lhc "Bid Nackage") will be agreed to by the City aiid Costco prior to Costco
recommending approval ai�d the City approving and issuing the }3id Package. !
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c. I,iquidatcd llamages. I�he Construction Contract will includc ��
asscssment ot'liquidated damages oi Ten Thousand Dollars ($10,000.00) per day. m� as otl7erwise
mutually approvcd by Costco and City, shoulcl tl�c Contractor not complete the Public
Lnprovements or milestone segments tl�ereof ��vithi❑ tl�e allocated working days. Che
Consuuciion Contract shall include disclosure to thc conu�RCtor that u��excused delays in thc
work may result in damages not only to City but also to Costco wliosc on-sitc work musl be �,
� coordinated with contracto�'s performance oC ihc Public Improvemei�[s work and whosc
cerlificate of occupancy for the SiYe cannot be issued ttntil thc Publie Improvemcnis are
completcd. �
d. Conh�act ]Zetention. 'I'hc City will rctain 5 peroent of each progress
payment to �he contracto* i❑ accordancc Nith tlie Public Contract Code and the Construction
Contract.
302.3 Financing Niechanism. Without limiting lhe generality of Section 302.1,
Cit}' sl�all tiue commercially reasonable best efforts to obtain funding required to construct the
Public Improveme�nta f�um gran�s and other sources tl�a� do not need to be repaid. [f City mus�
borrow �nd repay all a� p�irt of the Co��ds required to consu'uct the Public lmprovements (Uie
obligation ti�r suclt boi'rowing and repaymeut being rei�ereed to herein as the "Financing
Mechanism"), City shall providc copics of the documentalion lbr the Financi»g Mcchanism to ,
Costcu for approval as a contliliun to Custco's issuancc of its Financi��g Waivcr T�u�ice. Whilc ��
the Public Improveme�nts are ibr the benefit of the Site and surrounding aretis of the City oP
Llki�h, the p�rtics acl:nowledge that City's abilit�� to rcpay under the H�inancing Mechanism I
would rely in part on economic benefits to City generated by the devclopment and operation of
Costcds busincss ait thc Sitc. Accordingly, subjcul to Scctiuu 604, including, wilhuut limitation, i
any tin�e adjustments that may he �igreed upon atnong the parties; the ��arties herehy agrce as I
Ibllows: li�, a(tcr giving both its Financing Waiver Nolicc and its Gcncral Waivcr Noticc, Costco �
fails to ptu�chasc the Site, lo dcvclop the Sitc, to opcn its businoss at thc Sitc wilhin tlic titne
specified i� the Scheilule oC Perfonnance. or tu operate its busines� at the Site lix at leest twenty
(20) yeais after issuance ol'the C'ertilicate of Occupancy, thcn under any of thnse circumstances
Costco shall make annual payments to City (the °Custco Financing Ubligatiod') in an amount I
equal to the original principal under the Pinancing Mechanism at the stated interest rate
� amortized over a twcnty (20) ycar tcrm, with thc lirsl such payment to bc madc H�itliin lhree
hundred sixty-five (365) days after the triagering event and continuing through the iwentieth
(20"') year afrer which Costco was schcduled to open for busincss at the 5itc; providcd, however,
for any part of the twenty (�0) yeurs during which sucl� payments otherwise �vould bc duc
hereunder, the Costco Pin<mcin� Obli�ation shnll be mitigated 1nd no payment or reduced
paymenl shall he due frotn Costco, as lollows(the "Mitig�tion"):
a. the payment shall be fully mitigated if the City is legalfy able to
prc-pay er make pnymcnls on thc amount linanccd using thc Financing Mcchauism, Gom (1) auy
� �!rant reccived by the Ciry to p1y all or any portion oY the cost oftlie Public Improvements or (2)
all or�+ny porlion ul�the 201 1 Series A Tax Allocaliun Bonds issued by its Ibrmer redevelopment
, eigency �is � result ol a decision by tl�c DeparUnent of Pinance or t+ cow�tjudgment; or
b. tlie payment sh111 be partially or l��dfy mitigated if the Site or any I
part thcrcof is occupicd by onc or murc rctail uscrs, thc paymcnts that would bc duc from Costco
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Cor such year and auy ensuing years shall be offset by an amount equal to a cumttlative one
perce��t (1%) of the salcs taxes (or such other perecntage of die 13radlcy-Bmns Unifi�rm l,ocal
Sales and Usc 'Cax allocated to cilics undcr Revctluc nnd 'I�axalion Code section 7202(h) or any
adclilionxl or successor provisions uf state law) generated from Yhe Site on an amival basis, on an
all-firsY-dollars-received basis irrcspective of other Purposes to which Ciry may commit its sales
taxes revenucs. �
Costco may cicct at euty time �nd Gom time to time, in its solc and absohitc
�liscretiou and without waiving the Vlitigation, to prc-pay any ur all of tlie annual �aytnents fur
�,�hich it is responsiblc hy paying io City ihe present valuc at dic timc of pre-payment of tlie
payments that are being pre-paid, �t the following ralcs: (1) if the Pinancin� Mcchanism includes
a right to prc-pa}� principal without pen��lty, the umouut of thc prepnymen[ shall be tl�e amo�mt of
priucipal Cos(co ciccts to prepay; (?) if the [inancing Mechanism includes a right to pre-pay,
subject to a penalty, the amnunt oY the prepayment shal] be the amowit of principal Costco elects
to prcpay plus the penalty; and (3) if prcpaymenls are nol permitted hy the terms of the
Pinancitig Mechanism, the amouut of prenayment shall be the amount ot thc principal Costco
elects to prepay, rcduccd by a discount ralc cqual lo the lesser of lhe yield on tlie Cily's
investmenl oCsurplus funds or the iuterest rate on the [inancing Mechanism as of the date of pre-
payment ("Present Valuc'�). �
3U2.3.1 Costcu Onlr Examnles: (;i) if Costco failcd to opcn within thc �
scheduled timc, opcned fivc (>) ��ears latcr and remaincd opcn for at least tifrccn (IS) more I
years, Coslcu would make the annual amortirc�l payments during thosc livc (5) years, but not �
thcrc�Rcr; (b) if CosCCO did not open within iwenty (20) years after the scheduled opening time,
Costco would make thc annual amortized paymcnts for twenly (20) years; (c) if Costco ope�ed i
within thc schcdulcd tintc but permancntly closcd aftcr tivc (5) ycars, Costco would makc thc
annual amurtize� payments lbr the remaining fifteen (I S) years after its clvsure.
3(12.3.2 Other Retailer T,xamnles if Costcn operated fi�om the Site for
the first tive (5) years, and theii trtmsferred the Site to one or more otlier retailers who gcnerated ,
sufficienl sales taxcs lo scrvice thc dcbt on lhe F'inancing Mechnnism for the next fifteen (15)
years, no payiuents would be due from Costco. 1f in year tive (5) Costco i��s[cad transferred to
o�e or morc retailcrs whosc one percent (1%) oC sales tax in a givcn ycar cqualed one-half the
dcbt scrvicc on ihe Financing Mcchanism, then C'oslco would pay to City tlie remaining one-half
oftlte debt seivice for that year.
3023.3 CD13G Fundin�. Yrovidcd that Coslco shall incur no financial �
liability or uther liahility if it t<iils to create ai�}� specified or minimum nwnbcr of qualifying new ,
jobs, Coslco agrces to considcr cooperating with thc C'ity in a conunercially reasonable manner
consistent w�ith its internal hirin� policies in order to assist in qualifying Ihe City lbr a
Communit}' Development 131ock Grant ("CllB(i") for public trcilities thaY will help hmd tlle
Public Improvemeuiy reyuireJ by Seclion 302.1 oC lhis Agreemenl by crcating new jobs in its
Ul:iah store thal primarily bcnefil low- and modcrate-incomc pei:sons (generally defined as a
member of a family having an income equal to or less than tl�e Section 8 low income limit
cstablishcd by I]UD). ). Such cooperation may includc Costco cntering an adciitioual agreement
or agreements with the City or iF�ird parties, on terms accepteble to Costco and cunsistenl with
the foregoing requirements, if necessary for the Ciry to qualify fnr the C1�I�G.
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303. 'faxes, Assessments, I?ncumbrances and Liens Costco shall pay when dtie all
real estate taxes and assessments assesscd and levied on the Sitc for any period subsequent to
convcyance of titic to or dclive�y of posscssion of the Sitc. Prior to issunmce of the Certificatc of
Occupancy, Costco shall not place or allow to be placed on Ilie Site airy mortgage, trust deed,
lien ur o[her monctaiy encumbrance unauthm'ized by this Agreement. Cos[co shall ��move or '
havc rcmoved any le�ry or attachment made on the Site (or any portion thereof), or shall assurc �
the sa�isttiction thcrcof, within a reasonable timc, but in any event prior to a sale thereundcr.
Nolhing herein contained sliall be deemed to prohibit Costco from contesting tl�c validity ur
amounts ofany tas. assescmcnt, encumbrance or lien. to limit the retnedics availahle to Costco in
rzspect thereto, or to prevei�t Costco from placing utility and other easements on tl�e Site
consistent with the Scope of I)evclopment.
3Ud. Prohibition 4�ainst Transfer of Site, ihe 13uildin�s or Struchu•es Thereon
and AssiQnmcnt uf Aereement
304.1 'll•ansfer Priur to Certificate of Oceupancy. After coitveyance oF [itle
�nd prior to issuance ol thc Certificate of Occup�ncy, Costco sliall not, except as expressly
pcnnittcd by this AgrecmeN, scll, transCcr. convcy, assign, lc�se, disposc of or further encumber
or agree to scll, as5ign, u�a�sfer, dispose of ur llirther eucumbcr or suffer to exist auy othcr lien
against the whole or any pan ot the Sitc or the huildings or improvements ihercon, or nny intcrest
thcrcin (each, a"Trnnsfcr"), �sithout thc prior writicn approval of City, which approval sl�all no[
bc unreasonably withhcld, conditioncd, dclaycd or dcnicd. This prohibition shall not apply
subsequent to issuance uCthe Certil7cate of Occupancy. This prohibitio�� shall not be deemed to
prevent the granting of easements or permits tn facilitate the development of the Sile or to
prohibit or resirict the leasing of flny parl or parts of a builcting or structure when said
improvemcnts 1rc completcd; provided, howevcr, Custco is a publicly-tradcd company and any
change in owncrship ul' Costcds ptiblicly-traded capital stock sh�ll not cunstitute a Transfer
precluded hy the foreg��ing restriciions.
304.2 '1'ransfcr [o Aff'ili;�tc. Nolwithstanding Scction 304.1 or auy othcr
provision in this �Agreemcnt to thc co�i'.�a�'�. but subject to Section 304.3, Costco shall be entitled
to assig❑ Costcds interest uncler this Agreement and iu thc Sile and improvements after
conveyance of titic to Costco, without Cit��'s consent, to (il a subsidiar}�, afTiliate or parent of
Costco or any other entity whidi controts, is conU'olled by or is undcr conunon control with
Costco, provided Costco sl�all not be released fl'o�n its obligations or liabilitics hereunder; (ii) a
successor of Costco as a result ol a mergcr or consolidation; or (iii) a limited liability compauy
the members of which includc a majority composcd of Custco amd/or entities controlled by,
conlrolling or tmder common control with, Costco.
304.3 Continuin� ObligaYion. In the abseuce of specitic written agrecmeut by
City, (i) no 'll'ansfcr shall bc dccmcd to rclicvc Costco or any othcr party li�om anv ohligations
under this Agreemenl until completion ul �levelopmau� as evidenced by issuance oC the
Certilicate of Occu��ancy, and (ii) in the event of any �I�ransfer or any clectinn hy Costco not to
develop Yhe Site or not to operate I'roin the Site,which election is made �lter Cosico delivers botli
its Financing Waivcr Noticc and its Gcncral W'aivcr Nolicc, and subjcct to thc Continuing
Contlitiuns, Coslco shall rem�ii� obligalcd under Section 302 hereul�.
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305. Sccurit�' Financin�; Ri�hts of Holdcrs
305.1 Nu I�;ncumbrances G:xcent Ylorlsaees, Deeds of 'frust, S�les �nd
Leasa6�eks or Other I�inancing fur Devclonmenf Notwithstanding Sectio��s �03 �iud �04 of �I
this Agrcement, mortgages, decds of trust, sales and Icase-backs or any other form ol
conveyance required for�ny reasonable method oC tin�ncing are permitted before issua��ce of the
Certilicatc of Occupancy, but only lbr the purpose of securing loans oC funds to bc used for �
flnancing the acquisition of the Site, �he consu�uclion ol improvcments on the Si[e a��d t�ny other
cxpenditures i�ecessaiy and appropriate to dcvelop thc Site undcr tllis AgrccmenL Costco shall
notify City iv advance of any moitgage, deed of tn�st, sale and Iease-back or other fonu of
co�veyance Cor financing if Coslco proposes lo enter into the samc belore issuance of the
Ccrtificate of Occupancy. Costco shall not enter into auy such conveyance for financinb without
the prior written approval of City (unlcss such Iender shall be one of lhe teu (10) largest banking
institulions doing busincss in thc Statc of Calii�ornia, or one of tl�c ten (10) largcst insuraiice
lending institutions in the United States yualilicd lo du busines5 in the Sitde of Cali(brnin), which
appro���l Ciry agrecs to give il any such conveyance is given to a re�sponsible financial or lending
institutiun or other acceptable person or cntity. Such lender shall be deemed approved unless �
rcjccicd in writing by Cily withiu lcn (10) datys �ftcr Costco has Cm�nishcd City with inlormation I
reasonably reyuested by City to evaluxte lhe propused linauci�ig. In nny event, Cuslco shall �
��rnm�itly notify City of any morigage, deed of trust, sale and lease-back or other tu�ancing �
convcyance, encumbrancc or lien that has been createcl or attached thereto prior to completion of �
the construction of thc improvcmcuts on thc Sitc whctlicr by voluntary act of Costco or
otherwisc. 'I'he words "murtgage" <uid °�lee�l of trust," as use�l licrein, include all other
appropriate modes of financing re<�I estate acquisition. cnnstruction and land develnpment. �
305.2 Holder Not Obli�+atcd to Cons[ruct lmpruvements 'l�hc holder of tiny �
mortgage, deed of trust or othcr security intcrost �uthorized by this Agreement shall in no way bc �
obligated by the provisions of this Agrcement to construct or complete the improvcmcnts or to
guarantec such construction or complction, nor shall any covenant or any other provision in the
Grant Deed for the Site be consfiued so to obliga[e such holder. I�otliing in this 9greement shal]
be deemed to construe, permit or authorize any such holder to devotc the Site to any uses m� to
consu-uct eny improvemcnts thacon other than thosc uses or improvements provided for or
authoriral by this Agrecment.
305.3 Notice� of Default to Mortea¢e, Dced of "1'rust or Other Securitv
Inlerest klolder+; Ri¢ht ta Cure Whenever Cily shall dcliver Any notice or demand tu Costco
with respect to any brcach or de�<�ult bv Cos;co in completion ol� conslruction of the
in�pruvemeuts. City shall at lhe tieme lim� �leliver n copy of such notice ur dcma�d to each
holder ol record ol� any mm'tgagc, dccd of trust or oQier security interest authorized by this
Agreement who has previously made a written rcqucst to City therefor and provided an address
for recciving sucli nuticcs, �t�ch such holder shall (insofar as thc rights of Ciry are concerned)
have llie right. at ils oplion, within ninety (90) ilxys �i[lcr lhe receipl oC the nolice, Lo ctu�e or
remedy or commencc to cure or remedy any such default and to add ihe cost thereof to the
security interest debt and the lien on its securily interest. In the cveni therc is morc lhan oiic sueh
holdcr, thc right to curc or rcmcdy a brcuch <�r dcf�wh ol Costco undcr this Scction 3053 shall be
crercised by the holder lirst iu priurity ur as ll�e hulcicrs rntiy ollierwise agree t�mon� thcroseh�es,
hut there shall he �nly rme exercise of such right to cure and remcdy a hrcach rn� defaufl of'
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Costco undcr this Scction 305.3. Nothing containcd in tl�is Agrccmcnt shall bc dcemcd to permit
or autliorize such holdc r to underteke ur continue lhe consll'uclion or complction of the
imEn�ovements (beyond the extent necessary io conscive or ��rotect the improvements or
construction ah�eady madc) without liist having expressly nssuuied Costco's obligations to City
hy written agreement satisf�ctory to City. "I'he holder in that e��ent must agree to complete, in the
manncr provided in this A�reemcut, the improvemants to wliich thc lien or title of sucl� holder
relates and submit cvidence satisfacto�y to Ciry that it has the qualitications and financial
responsibility nccessary to perform such obligations. Any such holder properly compleling such
impirovements shall be cutitled, upon mritten requcst madc lo City, to a certiflcate oY occupancy
from City.
305.4 Failw•e uf tlolder tu Comnlete ►mnrovements In any case where, six
(() mouths after deY�iult by Custco in complction of construction ol improvcmenls under tliis
Agrecmcnt, the holder of any mortg�ge. deed uf hust or other sccw ily intcrest a-eating a licn or
enctunbr�nce upon the Site has not cxercised the o�ition to construct, or if it has exercised tlie
o��tion anci has not proceeded diligently with conslruclion, City inay piu'chase the mortgagq deed
of trusl or other security interest by payment to the holdcr of the amo�mt of the tmpaid debt, plus �
any accrued and unpaid interest If the o���nershi�� of the Site h�is vested in the holdcr, City, if it
so desires. shall be entitled to a conveyxnce of the Sitc fi'om thc holder to Cily upmt payme��t lu
the holder ol'an amouu� equal to the sum of lhe folfowing: �
a. Thc unpaid mortg��ge, dccd ol u ust or other security in[erest debt at
the time title becamc vested in tlie holder (Icss all �ippropri�tte credils, incltiding those resu][ing
Crom collection and application of rentuls zmd other incomc rcccivcd d�u�ing foreclosw�e
procecdings); �
h. All expenses with respect to foreclosw�e;
c The net expenses, iC a��y (exclusive af geiier��il overhead), ineurred
by thc holdcr as a direct result of the subsequent managcment ol thc Site;
d. Thc costs ol any autltorized improvemcnts madc by sucl� l�oldcr;
aml
e. An amount cquiv�lent tu the intcrest that would havc accrued on I
the aegregate of such timoimts had all such amow�ts become part oF the mortgage or decd of trust
dcbt and such dcbt hacl continual in cxistcncc to thc dalc ol�payment hy City.
305.5 Ri�hl o}' Cih� tu Cure Mur(�x�c, Dccd of "1'rust ur Other SecuritV
Interes[ Default In the event of a default ��r hreach hy Costcn of ;� mortgage, deed of trust or
olhcr sccurity interest wiUi respect to tlie Sitc prior tu tlle completion of dcvclopment. and the �
holder has not exerciscd its option to complcte the development, City mny curc lhc dcCault prior
to completion of any foreclosure. In such event, City sh�ll bc cntitled lo rcimburscmenl Crom
Costco of all costs and expenses inciured by City in cin�ing thc default. City shall also be entitled
to a lieu upon the Site to (he c�tent of stich cosls and disbursements. Airy such lien shall be
subjec[ to mortg2ges, deeds of u�ust or other seciu'ity interests exccuted for the sole purposc of
obtainit�� funds to purehase and dcvelop the Site as authorized herein.
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306. RieLt of Citv to Satisfv Other Liens on the Site After 'fitle Passes After [he �
conveyance of title and prior to itsuancc of the Certiticatc uf Occupancy, and after Costco has
had a rcasonable timc lo challenge, cure or satisfy any liens or encumbr�nces on the Site, City
shall have the right to satisfy any such lieiis or encumbrances, provided, however, that nothing in
this Agrecment shall requirc Costco tu pay or inake provision tbr [lie paymenl of any lax,
assessment, lien or charge so long as Costco in good failh shall contest the validity or amount
thereo�; and so long �s siich delay in payment shall not subject the Site to forfeiture or sale.
400. USI? OF THP; S1TE
401. Uses Costco covenants and agrccs for itself, its succcssors, its �ssigns and every �
successur i❑ inlere5t lhetl unlil issuancc ot 111� Cerlilicale ol� Occupa�cy. Coslco and its �
successors �nd Tssignees shall devote the Site to thc uscs spccilicd in dcvclopmcnt restrictions of
record and applicable conditions of approval, the (irant Deed aud tliis Agreement.
402. Obli�ution to Refrain From Uiscrimination Costco covcnants by and for itsclC
aud any successors in interesl that lhere shall be no discrimination against or segrcgation of atry
person or group of persons on account of race. colnr, crced, rcliginn, ses, inantal status, ancestry
or national origiu in the salc, leasc, sublease, tra�sfer, use, occupaucy, tenure or enjoyment of the
Site, nor shaff Costco itsclf or any person cleiiming undcr or through it cstablish or permit auy
such practice or pr�ctices of discrimination or segrcgatiou witll reference to the selection,
location, munber, us� rn� occupancy ol tenants, Ie�Sees, suhtenants, suhlessees or vendees of the
Site. 'I�he foregoing covenants shall run with the land.
403. P'urm uf Nondiscriminalion and Nonse�reeation Clauses Costco sliall refrai❑
fi�om restricting the rental, salc or ]ease of the Site on the basis of race, color, crced, rcligion, sex,
m�rilal sltilus, ancestry or national origin ol an�� person. [111 such dceds, leases or contrac[s shall
coutain or be subject ro substantially thc follo�n�ing nondiscrimination or nonsegregation cla�ises:
l. In deeds: "The grantec hercin co��enants by and fbr himself or herself, his
on c�n c�irs, cTCCUtors, administrators and assigns, and all persons clain�ing under or through
them, thal there shall bc no discriminalion againsl or yegregatiml of any person ur group of
persons on account ol race, color, creed, rcligion. ses. marital stalus, national origin or aucestry
in the sale, lease, stiblease, U�ansl�er, use, occupancy, tenure or e�yoyment of the premises herein
convcycd, nor shall Uic grautcc, or any person cfaimim� undcr or through him on c�r, cstablish or
permit any aich practice or practices uf discriminatiun ur segregtuio❑ with rcferenu to the
selectinn, I�ication, numher, u,ee nr occunancy of tcnants, Icssecs, sublcnants, sublesse�es or
vendees in thc premises hereiu conveyed. �Che Ibregoing covenants shall run with the laiid."
2. In lenses: "'fhc Icssce herein covenunts by and for ltimself or herself, his
or her heirs, executors, administrators and assigns, and all persuns claiming ui�der or lhrough him
or her. and this Icase is made aud accepted upon and subject to the following conditions: That
Uiere shall be no discrimination against or segregation of any person or group of persons on ,
accounl of race, colur. creed, religiou, sex, maritnl slatus, national origin or anccslry, in thc
]easin�;, sublcasing, trausfcrrin�!, usc, occupancy, tenw�e or eiijoyment of the premises lter�in
le�ised, nor shall thc lessee himself or herself, or any person claiming under or through him or ��
her, establish or permit liiy such practice or prxctices of discrimination or seeregation witli
26
,
I
reference to the selection, location, numbcr, use or occupanc}� ui' Icnants, lessees, subtenants,
stiblessees or vendees in the premises hereii� leascd."
3. In con[racts "There shall be no discrimination agt�inst or segregation of
any persou or group ol� persons on account of r��ce, color, crccd, rcligion, scx, marita] status,
na(ional origin or ancesu�y in the sale, lease, sublcase, lransler, use, occuna�cv, ten�n�e or
e�ijoyment of thc premises, nor shall thc tcansferee himself or 1�crscll�, or any person claitning
tmder or through him or l�er, establisli or permit any sudi pr�cticc or practices oY'discrimination
or segregation with re2erence lo the selection, location, nwnber, use or occupancy of tcuants,
lessees, subtenants, suhle�sees or vendees uf the prciniscs." �
404. F.ffect and Dm ation of Cuvenan[s Except as otherwise provided, thc covcnants �
co��tained in this Agreement and the Cirant Deed and tl�e Memorandum of Agreemenl shall �I
rem�in in cffcct �s provicicd hcrcin nnd in lhc Grant Uccd 2nd thc Mcmorandum of Aorccment. �
I�he covenants against discrimination shall rentain in etfect in perpetuiry. The covenants �
established in this Agreement and the Cn�ant Deed shall, without regard to technical classification
and dcsignation, be binding for the benefit and in favor of City, its successors and assigns, and
any successor in interest to tlie Site or any part thereof. j
405. Rights of Access — Public Im�rovements nnd G'acilities City, Cor itself and
other public agencies, at their sole risk and expense, reserves the right to enter the Site or any
peri thereof aT all rcasonable timcs aud with as little interference as possible Cor the purposes of
conslluction, reconsU'uction, muintenance, rcpair or scrvice of viy public improvemcnts or I
public facilities located on the Site. Any such entry shall be made only after reasonable notice tu
Costco, and City sliall indcmnify and hold Costco hai�mlcss Gom any claims or liahilitics �
pertaining to twy entry, except to tl�e extent caused by the negligence of Costco. Any damage or
injury to the Sitc resulting from such cniry shall be prompUy rcpaired al the solo expcnse of lhc
public agency responsiblc for (hc cnuy.
5011. UEFAULTS, REMEDIES ANll 'fERMINA'PION �
I
501. Defaults — General Subjcct iu dic extensions of time set f�irth in Scction 604, '�
failw�c a� dclay by cither parly lo perfonn eny term or provision of this Agreement constituLes a �
default under this Agreement The plrty who so fails or delays must immedi�ttely commence to
cure, correct or remedy such failure or delay and shall cumplete such cure, correction or remedy
with rcasonablc diligcnce and during any period of curing shall not be in default The injured I
party shall give written notice of delauh to thc party in dclault specifying thc dclault complained
ol by [he injured party. Cxcep[ as required to protect against further damages and exccpt as
otherwise expressly provided in Scetion 505 01' Lhis Agreement, Uie ii�jm'cd party meiy nol li
institute proceedings or esercise any other remedies against the party in def�ult until ninety (90) �
day, �Iter �iviug such notice or, in ihe casc of an �sserlcd default by l:ity or Cily's eonh�actor(s) ��
in ihe construction of the Public In�provemcnts, within ten (10) business days afrer giving of �
such notice. t�ailure or dclay in giving such notice shall ��ot constitute a ��aiver of�any deCault �
nor shall it change the time of default. I;xcept as othciwise expressly provided in this �
Agreemcnt, any failure or delay by eilher parry in asserting any oi�its riglits or remedics as to any
dcfuult sl�all not operate as a waivcr of auy default or of m�y sucl� rights or remedies or dcpi�ivc
27
such party of its right to institutc and maintain �ny actions or procccdings that it may decnt
necessaiy to proteci, asscrt or enforce any such rights ur remcdies.
502. Le¢:�l Actiuns
502.1 L�stih�tion uf' Le�;al Actions In addition to any other rights or rcmedies,
but subject to nny limitaiions set Corth I�crcin, cithcr party may institute Iegal ac[ion to cure. �
correci or remcdy any default, ur recover damages for any def�ult, or to obtain auy othcr remedy
consistent with die purpose of this Agreement Such Icgal aclions must he instituted in the
Superior Court of the County of Mendocino, State of CaliYornia, all partics consenting to the ��
jurisdiction and vcnuc of such courts and to lhe stale nppcllatc courts. I
502.2 Ann�icable Law; Internret�tion The laws of the State of Cali fornia shall '
gnvern the inlerpretation anc! enforcement of this ngreentenL "Chis Agreement has been
negoti�jted at arm's lengih and bchvicen persons sophisticated aud kiiowledgeable iu thc matters
deult with herein. In addition, each purty has been represented by erperienced and
kuowlcdgcablc legal counsel. Accordiugl}�, an�� rule of law (including Californi�a Civil Code
Section 1654) a legal decision that w�ould require interpretation of any ambiguitics in this
Agreement against the party that has drafred it is not apE�licable and is waivcd. The provisions of
this Agreement sh�ll be interpretcd in a reasonable manner to effect the pm�poses of ll�e partics
tmd this Agreemcut.
502.3 Aecept�nce uf Scrvice of Process In the event thai any legal action is
commenced by Cosico against City or Successor Agency, service of process shall be niade by
personal service upon thc Ukiph City Clerk or in such other manner as may be provided by law.
In tha event that any legal acii�n is commenced by City or Succcssor Agcncy a�ainst Cosleo, �
service uf proccss on Costco shall be niadc by scrvice upon CT Corpuration Systen�, 8l8 Wesl
Seventh Strcct, I.os t�ngeles. CA 90017. or any successor Agenl for Service af Process as filed
with the Cxlifornia Secretary ol'State.
�03. Ri�hts and Remcdics arc Cumulati��c Lxcept as othcrwise expressly s[ated in
this Agrecmcnt, thc rights and remedies ol the parties are cumalative, ai�d the exercise by nny �
narty of one or more oP Guch rights nr remedies shall not preclude the exercise hy it, at the same ��
time or different times, of any otlicr rights or remcdics for thc same deYault or any other default
by thc othcr pnrty.
504. Remedies Generallv If Costco, City or Succcssor /�gency deCaults with regard to
any of che provisions of this ngrecment, thc non-dciaultiug E�arry shall se�ve wrilten noticc of
such dcfaull upon ihe detaulting party. ll�a default by City/Successm� ngency is not cured witl�in
the applic.ible time period specificd in Section 501 as extended pw�su;ant to Scction 604, Costco
shall have tl�e remedies provided in Section �05.1, the choice of whicli then-applicable remedies
may be made in Costco's sole and absolute discretion. lf u defaull by Costco is not cured within �
the applicable time period speci(ied iu Section �01 �s extended pursuant to Section 604, Cily or �
Successor Agency shall have the thcii-applicable rcmedies provided in Sections 505.2 and SOIi,
the choicc of which then-applicable remcdies may be made in City/Successor Agency's sole and
absolule discretion .
'8 i
505. Remedies and Riahts uf Tcrmination �
505.1 Remedies Available to Costco. in the event that (a) on or beYi�rc Costco's
dclivery of both its Financing Waiver Votice ancl its Ucneral V✓aiver Notice, Costco detennines '
that any of the conditions of Scction 205.] of this Agreement will not be satisfied withiu the time ',
� required by the Scliedule of Perfonnance (Attaclm�ent No. 3), as extcnded pw�suant to Section
604; (b) after C�ostcds delivciy ot both its Financing W��iver Notice and its Genera] Waiver
Notice, (bstco deterntines that any ot thc Continuing Couditions of Seclion 205.1 of this
ngreement will not be or rem2in satisficd as oPthe tin�c required by the Schedule of Performanec
(Altachmeut No. 3) as ex(ended by Section 604; or (c) at any Time C;ity or tiuccessor Agency i; �
in breach or default N�ith respect to an}� other obligation of Ciry or Sticcessoi• .Agency,
� respectively, under ttiis Agreemenl, including, will�out limilalion, Successor Agency� tendering
conveypncc oC the Site or possession thereof in tlie mauner and condition and by thc datc
provided in this Agrecment subject to extension undcr Section 604: and if any default or failure
relcn�cd to in this Section 505.1 shall not be cured witl�in the �pplicablc timc period allcr the date
of written demand b}� Cosico or such lon�cr period of time as reason�tbly inay be necessary for
the particular cure, then Costco, at its uption, may (i) seek specific performance of this
Agreement, including at[orneys' fees and costs incun�ed in pursuing specilic �cr(ormance; (ii)
cure the default on bchalC of delziulting party 1nd obtain reimbursemenl from �he defaulling party
of costs and expenses incw�red in connection with such cure. induding, without limitation, ��
attoineys' fecs; or (iii) terminate this Agreement by writte�l notice of� ter�uination lo City and li
Successor Agency, and any righls with respect lo Coslc�o 2gainst City �ud Succcssor Agency or �
any assigne� or Lransferee in. to ur u�der lhis Agreement, pertaining W this ngrecntenL or arising i
out of this Agreement, sliall lenninate. Upon such tcrmination, the Deposil shall be returned to
Costco as provided in Scction 104, and subject to an extension of time uuder Section 604, Costco
shall be entitled to rcimb�usement oC o��t-oY-pockct cxpenses incurred in pursui[ of this
tr�nsactiun ("Cuslcu's Actutil Ds�mages") hut nut fur cot�seyuential damages znd, except for
Costco's Actual Dam�ges, neither City, nor tiuccessor Agency, nor Coslco shall have any furthcr
ri�hts ag.iinst or liability lo the oUicr undcr lhis ilgrecment, iududine, without limitatio�, with �
respcct to thc Costco Pinancing Obligation; pruvidcd, howcvcr, that if thc City/Succcssor
Agency is prcvente�l from perlbrmin� �iny uf its obligatiuns undcr Sectiun 205.1 by a �ecision of
anoiher government agency nr cnurt Ciistc��'s exclusi��e remedy is tennination of thc ngreement
or a demand that thc City c�haust any available administrative or judicial remedias to challengc
that iiecision. Costco sheill bc cntiticd to Costco's t�ctual Damagcs oiily if thc City fails or
rcfu�es tu fullv eKl�aust such adminisU'ati��e amlju�licial retue�ies.
SOgZ Remedies Available to Citv. In the event that (a) CosTco f.�ils to maintain
the amount oE the lleposit as required by Scction 104 oC this A�rcemcnl; (b) Costco translers or �
assigns or nttcmpts to transfer <�r ussign this Agieement or .my rights herein or in thc Sile or thc
buil�lin�;s or improveu�ents Ihercon i�� violation ol this �1�rcemcnt; (c) Costco is in breach or
� deC2ult with respect to any other obli�ation of Costco un�ler tl�is Agrccmcnt as cxtcnded by
Section 6G4; or (d) after Costco has dclivcird both ihc Pinancing VJaiver Notice and tlte General �
I Waiver Notice, Ciry is irrevoaibly obligaited to tlie Pinancing Mechanism, a�td aIl of the
Continuing Conditions are salisfic<I, Costco does nut p�y ihe Pw�chase Pricc and take title to thc
Site �mder tender of com�eyance by Successor Agency pwsuant to all the terms and conditions of
this Agrcement; and if any dclault or faihu'c reCerred to in this Section �0�.2 shall not be cured
within ninety (90) days atler thc date of written dem�nd by City/Sucecssor ngency or sueh
29
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longm' pariu�l uf time ds reasunably mny bc ueccssary for tlte perticular cw�e, then Successor �
Agency and City, at thcir mutual option (with the election by either of them being binding upon
bothofthcm). may:
I. Prior to Custcu Waiver Noticcs. IY a default or failure tuidcr
dauscs (a), (b) or (c) of this Scc�ion 505.2 occurs prior to Costco having delivcred both thc
Financing Waiver NoCice and the (ieneral Waiver Notice, terminate this Agreement bY written
notice oi tcrmination to Costco, and an}� rights with respect to City or Suceessor Ageney against �
Costco or �iny ussignce or trzmsfcrcc in, to or undcr this ngrecment, pertaining to this Agrccmcnt
or arising out of this /�grcement, shall terminate, in wliich case tl�e liquidated damages {�rovision
of Section �0>3 shall apply upon such tcrmination as the exdusive remedy of City and �
Successor Agency.
2. After Costco Waivcr Notices. If a default or lailurc undcr any of
clauses (a) through (d) of this Section �0>2 occurs after Costco has delivered boih the Financing
Waiver Nolice ��nd the General Wtiiver Notice, (i) seek specilic porlormance oi�ttiis Agreetnen[,
including ttttorneys' fees 1nd cosls inciu'red in pursuing specific performancc; (ii) cure thc
default on behalf ol Costco and obtain reimbursement from Costco of costs and expeuses
incurred in connection witlt sucli cure, including, without limitation, ariorneys' fees; (iii) if then
applicablc, cxcrcisc lhe op�ion imcter Seuion 506; or (iv) terminate ihis �Agrcemcnt by written
notice of termination to Costco, and any riahts ti�itli respcct to City or Suecessor Agency against
Costco or any assigncc or transl�ercc in, to oi' wtder this Agreement, pertuiuing lo this ilgrecment
or arising out of this Agrccment, shtill terminate, in which casc thc liquida[cd damages provision
ol Section �053 shnll apply upun such lerminaliun es Ihe cxclusive remedy oI City and
Succcssor Agency. except as otherwise provided in Sectian SOS,3, including that the Costco
Financing Obli6ation shall survivc such termination, subject to the Mitigation.
�05.3 Liquidatcd Ds�ma���. IN '1'LIF, 1=.VH;N'I' OF 'I'L-:f2M1NATION UNDGR
Sh;C'I'ION 505.2, 'fFIE llGPOSIT SHAI.L I3C RPTAINCD BY CITY nND SUCCESSOR
AGENCY AS I,TQUIDA'I'1';�) D/�YlnCil-:S i1ND AS I'I'S PROPP,RTY VJITHOI;T ANY
L)GUUC�17ON, C)FI�tiE�I' OR ItECOUYMGN'1' w'HA'fSOI��:VHK, G�I'l' AND SL'CCGSSOR
WAIVINU tAI,l, O'fI1�;R RIGII"i'S AND REM�llItiS, LXCGPT AS OTHH;RWISH; IN THIS
AGRCCM�NT GXPRESSLY PROVIDGD, I'�]CI,LDING. BUI� �IOT LIMITGD TO, 'I'HE
SIJRVIVf\I. OT� THIi COSTCO PIN.ANCINC; 0T3LT(iATION AS PIZOVIDED IN SI;CfION
SOJ.2. lh' COS'I�CO SIIOUI,ll DF,f'AUI.�I� UI'ON ll�S 013LIGATIONS, MAKINCi 1'I'
N1�;CE?SSARY POR CITY AND SIICCGSSOR AGGNCY TO "I'F.RMINA'I'E �fHIS
AGRGCMLN�1� AND TO PROCUI:E ANO'CILGI2 PAR'1�Y OR PAK'T�ICS TO RLDCVGI.OP
I'li� SITh: N SUBST/�NCIf�LLY TIIh: M/�NNER AND WITHIN THF, Ph:RIOD THA�� I
SUCH SI"I'G WOULll I3L RLUEVLLOYEU UNIJI:R 'I�HF: "I�ERMS OP THIS AGRCGMh:N1',
I'1-IGN THL DnMt�GGS SCPI�GRGD BY RLASOi� THERI'sOP \uOUl,ll BE UNCERTAIN.
SUCII DnMnGES WOULU INVO1.Vl? SUCll VAR[Al3IS; �ACTORS AS "I'HF, I
CONSID�RATION THAT SUCH PAR"IY WOULD P.4Y POR THL SCCH:; TIIh: EXVENSES �
OP CUI�I�INUING �I�I]E OWNh;RSllll' nND CON"IIZOI. OF "�I IF, SITL; OP INTGRLSTING
PARTICS AND NLGOTIATIt�'G WITH SUCH PARTILS; POSTPONh;MHN'C OF TAX
RIiV1iNUliS "I'lll?RI�:PRO�� l�0 "I'lll: COMMUNI'fY: AND 'I'(I� 1�AILUL2� OP CCCY "1'O
CTP�CT 1TS PU{iPOSGS A?V[) OBJECTIVGS R'1'I'IIfN /� REn50�]ABLG TIME,
RI:'SUL"fWG 1N ADDITIONAL IMML-:ASURABLL DAMAU� AND LOSS 'I'O CI'I�Y AND
;0
I Illl COMMUNI�fY. INCLUUIN(i SUCCI';SSOR AGI';NCY. fl' Iti IMPR/�C�IIC'A131.1�: �WI) �
I_XII�GMI�;I.Y l)II�PI('l ILI� "I'O FIX THI; AMOUNT Of Sli('I I UAMnGI?S lY) CIIY AND I
Sl'('('I�:SSOR �1GI:NCY. [3l� l flll? PART[ES ARE Ol� TI11? OPINION. UPON ll lli F3ASIS
OI� nLL INPOILMA�IION nVAII.n131.1�. 'I'O THH:M, "Clln'I� SUCII I)nMnGI�:S WOUI.D
APPROXIMAI�GI,Y I�:QUAI, "I�HIi AMOUN'I' Oi' 'I'III? DI�:POSI�I� III�:LD I3Y CI"I'Y AND
SUC('GSSUR 11(ih�NCY /�T �fI1F': '�IMI': OP 'I�HG DI:I�AUI;I� OF COST('O, AND TIIG
AMOUN'I� OI� SUCII DI?POSI"C SI InLL f3E PAID .IOIN�I.Y TO CI"i�Y ANU SUCCI�:SSOR ��
AGI�:NCY UPON nNY SUCII OC'CURRGNCI�: AS 'fIIF, �fOI'AL UF ALL LIQUID�"fl?D
DAMnGGS I�OR ANY nND �11.1. SUCH DLPt1ULTS AND NOI� nS t1 PLN.�I,�fY. IN 'I'IIL
EVGN1' �fl In'C 1�1115 PnRnGRnPI l SH(�ULD 13E HBI.D '�O BF. VOID FOR nNY RI:ASON
n'I I II'.IZ '1�1Ii1N Pl IRSUnN'1"I�O nN AC'f10N BY CIIY OR SUCCESSOR nGGNCY, CI"I�Y
nND SUCCESSOR A(;I�:NCY SIIALI. DG I�:N'CI'I�Lh:D 'I�O 'IIIE I�ULL IiXTI?N'C OF
U,1M,�G[?S OTIILRWIS6 PROVIDI:D l3Y LAW. COSI'CO, CITY ANI) SUC('I;SSOR
.nGIi�JCY SPHCII'ICALLY nCKNOWLF;DGE 'fHIS LIQUIDAII-:D DAMAGI�?S PROVISION
13Y 'I'I IF:IR SIGNiI"fURI?ti HI�:RL-:
k3y:=� � {�1",`` G
.I�e ChambeG{s, City Mana�er i
� By�"i 7ii�' -
JOne i e v D' tor I
�
�
BV: I
IZICIU�.iCl,f� �L « � 5� 1 C (��� �Ic ��- ���11L�t�S<<(� C��. / ',
� �
i06. Post-ClosinQ Ontion to Repurchase, Rcenter And Rcnossess If after
com�evxnce of tiUe to thc Site and prior to issuance of the Certilicate of Occupancy. Costco �,
shall: �
I. Fail to conuncnce construction of approvcd improvcmcnts un thc Sitc hy
the time spccified in tluachment No. 3, for any reason whatsoever, sul�ject to extension pwsuant �
to Seclion 604 of this /�greemcnt; for pw'poses uf this pruvisiun, ('ostcu shall he decmed to
"commence consu�uction" �+hen and only when Costcu has commenced rough grading on the
Site pursuant to 1 permil issued by Cit�� tbr the construclion of thc improvctncnts pravided for
hcrcin: or
2. Once consu'uction has bccn conuncnccd in accordancc �viih
subparagraph I above, abandon or substantially suspcnd cunstruction o� thc improvcmcnts �
through completion where such abandunm�nt or suspension has not becn cw�ed hy a resumption '�
ol work ���ilhin ninety (90) days atter written nutice of such uhandunment or suspension from
('ity, suhject to extension pursuant to Scction 604 of this n�reument ur �
i. Violute lhc restrictions on U�ansfcr sct Ibrth in Scction 304 of this
A�reement.
fhcn City. at ils optiun I}um und after Closin�. in its exclusive and unfettered
discretion_ shall have the rieht. but not the obligation. lo repurchasr thc Site ���ith all
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impruvements tliereon. The right and option to repurchase �he Sitc shall be suhordinate and �
subjec[to and be liinited by �nd shall not defeat. reuder invalid or limit: ��
L Any mortgage, dced of trust or other security insU'ument perntitted by this
, Agreement; or
2. Any rights or iuterests providcd in this Agrecmcnt for the protection of thc
holdcr of sucl� moilg�ges, deeds of trust or other security instrtmlents; or �
3. Any utility or othcr casemcnts or permits gra�ried by Costco to facilita[e
tlie development of the Site in accordance with tl�e Scope ot Development.
To exercise its right to rcpurchase, rccnter and take pusscssion with respect to lhe Site, ��
City s�hall pay �o Costco in cash an tjmount equal to: �
I. I�he cnsh Yurchase Price for tlie Site paid by Costco; plus
2. 1'I�c costs actually incurrad by Costco lor on-site labor and materials for j
thc conslr�iction of the improvcmcnts c�isting on thc Sitc at thc timc of tl�c repw•chasc, reenlry
and re�possession, exdusive of amounts fu�anced�. less
' 3. Any gains or incomc wilhdrnwn or m�de by Costco Crom the Site or tlie
improvements Ihereon; less
4. flro amount of licus on thc Sitc, and any unpaid asscssmcnts against thc
3ite; and less '
�. Thc present value of Costc�i's obligal'ion wit}� respect to [he Financing
Mechanism, if any, subject to future Mitigation resulting from subsequent uses of the Site as
provicicd in ScGion 302.3. �
GIIO. G�NERAL PROVISIONS ��
601. Nutices, Demands and Cummunir.itiuns 13etween the Nxrties All notices,
demards, consents, approvals and other cummunicario�is (eacli, a "Notice") which are required i
or desired to be giveu by eithcr part�� lo the olller u�tder this ngrecment shall bc in writin� and ��
� shall bc (a) hand delivered, (b) sent by L'.S. regis*.cred or certilie�l m�til, postage nrepaid, return
receipi requeste�, (c) sent by repulable uvernight courier service, ur (c!) transmitleS by facsimile
machine (wilh a printcd copy to follow by one of tlie other melhods prescribe in clauses (a)
� through (c) of this Section 601, including a copy of thc lransmissio�� sheet indicating successful
transmission of ihc Noticc by facsimilc machinc), addresscd to the approprialc party at its
adclress sei Forth in Section l03 hereof, ur ul �uch other address as Such party shall havr last
designated hy Notice to the olher. Noticcs shall be deemed given when delivered. Until notified
otherw�isc, Notices to City/Successor Agency shall be addressed to the attentio❑ oY the City
Managcr/Execulivc Dircctor. Until noti�icd olhcrwisc, Noticcs to Costco shall bc addresscd to
tlu attcntion of Seth S. Ka[z, Corpurate Cuunsel. Rcjection ur other refusal by the addressee to ,
accept a Notice or the inahility m deliver lhe Nntice becausc of a changcd t�ddresS of which no
Notice was givcn shall be dcemed to be receipt of lhe nbtice senl. Notices sent by counsel for
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� Costco or City, respcclivcly, shall bc decmcd Voticc givcn by the party provided that the Notice ��
is delivered to the party pursua��t to tlx t�oregoing; No[icc �iven onl}' to cotmsel Cor 2 party shall I
� not be deemcd n'olice givcn to that party. ��
� G02. Conflicts of Interest No mcmbcr, oflicial or cmploycc of City shall have any
� persoiuil intercsl, ilirect or in�lirect, in lhis Agreement, ��or shall tmy� such member, ul7icial or
cmployee participa[e in any decision rclating to Il�is ngrecment ihat aflecLS his or her peisonal
interests or the interesis of any corporation, parinership or association in which he or she is i
dircctly or indirccU�� intcrestcd. Cxcep[ as providcd in Section 704, c�ch pariy warrints that it '
has not paid or given, and will not pay or give, any third person any moncy oc uther
' considcration for obtaining this ngrcement.
603. Vonliabilitp uf Cit� Officials and b;mployees No n��ember, ollicial or cmployee �
� of City� or the Successor Agency shall bc personnlly ]iable to CosCCO in the event of any dcPault
or breach by City or Successor Agency or tbr any aiuount that m�p� become due to Costco or on
any obligations undcr the terms of this Agreement.
� C04. Enforced DelaV: Extension of T'imes of Perfur�uance ln addition to the
specific provisions ol this Agrcement, perfonnxnce by atty �>arty hereunder shall not be deemed
to be in default where delays or defaults arc due to war; acl of tcrrorism; insurrcction; strikes;
lock-uu��; riols; Iloods; earthyuakes; tires; casuallies; acts of God; acts of the pub(ic enemy;
epidemics, quarantine restric�ions; Gcight embargoes; ]ack of transportation; governmental
restrictions or peia�ity; litigation, including 1eg21 challcilges to govcrnmcntal approvals by City; �
unusually severe weathcr; inability to sccurc necessary labor, materials ar tools; delays of a��y j
conlracWr, subconl�actur or supplicr, acls of another p�u'ty; acts or the failw�e to act of any publie �I
a� gove�rmnental age�ncy or entity (exccpt thal acts or Il�c failure to act of City shall not excuse
perlormance by Cily); or any other causes beyond the control or without the fault of the p�irLy
clzti�ning an cxtcnsion of timc to perform. An eatcnsion of timc for any such causc shall only be
fur the paio�l uf the enfurce� delziy, wliich perio�l sh�ill couimencc lo run lYum the tiuie of the
� commencement of lhc cause. II', however, n��tice hy Yhe �iarty e(aiming sach eYtension is sent to
the otha:r paities more than tliirty (30) days altcr the commencement of the cause, the period shall
commcncc to rwi only ihirty (30) days prior to thc giving o��such noticc. Withoul limitin� tlie �
genertilily of the luregoing, either parly xlso sliall I�ave ttie right, but i�ot tlie ob�igatiun, to extend i
thc ��erind for obtaining ils ap��rov�ls in increments of Ihirty (30) d��ys each until the issuance of
a 1•inal Judg�uent in the eveut thal Uicre is an outstandiug appcal, objectiou or challcnge �i
respccting onc or more of thc approvals. Times of performancc ut�da� this ngrccmcnt may also �i
be exten�ed in writing by City/Sucecssur Agency �nd Costcu, an�l lhe City �[an��er/F,xecutive '�
Dircctor shall havc authorily �o make or to agree to such extensions without further consideration
thereof or action ihereon by City. lt lhe enforced dclays pw�suant to this SccLion 604 cause
perfbrmance in accordnnce with thc Schcdule of Performancc to be unYc�sible, the parlics sh�ll
mect and eonler to revise the times specified in the Schedule of Perlormince and the authority of
the City Manager/rxecutive Direclor pursuant [o the foreg<iing sentence shall include stpproval
� of such a rcviscd Schcdulc ot Perfonnance.
GOS. [nspcction of 13oolcs :�nd Records City has the right, upon not less than three (3)
busines:; days' notice, �t all reasonablc times, to inspeel thc books and records of Costco '
pertaining to the Site as pertinent to thc puiposes of this Agreement. Costco also has the righc,
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upon not less tl�an thrcc (�) days' noticc, at aill reasonablc iimcs, to inspcct thc books and records
of City pertaini�g to thc Sile as pertinent to the purposes of�his Agreement.
606. Plans Where Costco does not proceed with the purch�se �nd de��elopment of the
Site, and when this Agreement is terminatcd pursuant to Section 505.2 hercof for airy reuson,
Costco shall deliver to City .�ny and all plans for the Site, and City or any other person or entity
designated by City shall be Ii�ee to use sucl� plans, includin� plans previously dclivered to Cit}�.
for any reasan wh�itsoever without cost or liability tlierefor to Costco or a��y other person.
G07. Attm•nevs' Fees Should any action be brought arising out of this Agreement
including, without limitation. any action for declarator}� or injunctive relicf, the prevailing party
shall be entiQed to reasonable altorncys' fees and costs and expenses of investige�tion incurred,
includi.ig those incun�ed in appellate proceedin;;s or in any actiou or plrlicipation in, or in
conncction with, any case or proceedin� under Chapter 7, 1 1 or 13 of the 13ank�uptcy Code or
any succcssor statutes, �nd any iud�men� or decrec rendcred in any such actions or proceedings
shall include �i� award thereof.
6U8. Successors Bound Subject to the restrictions on assignmcnt conlained in Section
304 hcrcof, lhc provisions of lhis ngrccmcnt shall cstcnd to, bind and inure to the benefit of tlle �
parties lo this Agreement �nd thei: respective personnl representatives, heir5, successors and
ttssign>
6U9. Seva�ability II any term or provision of this Agreement shal!, to any extenl. be �
hcW im�alid or uncntorccable, the remaiuing tcrms �nd provisions of this Agrccmcnt shall not bc
affected thereby, buC eacli remaining term anil provision sl�all be vt�lid aml eilfurced to the Culfest �
cxtcnl��crmittcd by law.
610. Captions "Che eaptions ol this Agreement are inserted solely foc convenieuce of
referen<:e onl�� tmd do not detine, describe or limit ihe scopc or intent of this ngrcement or any I
tcrm hcrcof.
fil l. Construction City, Successor Agency and Costco acknowlcdge lhal cach party �
and its counscl h�vc rcvicwcd and reviscd this Agreement and t�hat tl�e normal rule of �
construction to the eifect tl�at any ambiguities are lo be resolved against the drafiing party shall
not bc cmploycd it� thc intcrprctalion of this Agecmcnt (indudin� the attaclunents and crhibits
heretu) or any amendments heretu, xnd the same shall be construcel ncilher lur nor against City;.
Succcssor ilgency or Costco, but shall be given si reasonable interpretatiou in accordancc with
the plain meaning of its terms and the intent ofthe partics.
612. Partv's Approval Ri�hts Whenever in this Agrcement � plrty is dcemed to �
disuppruve of a particular ��iatter, or a condiliou is cicemed not to be satisf�ed bY reasoi� uf the
parry's failtu'c to approve of the same nr to acknowledge that the same is satistied, the other �
parties shall have no right to conclusively deem the party tu have disapprovcd ol such mattcr or
to deem such condition not satislied, unlcss and unlil the pt�rty or parlics secki�ig to dcem thc �
matter clisapproved ("the deeming party") gives writt�u notice to the party who is deemeel to
have diapproved (°the disa��pro��ing parry") ihat decming �iarty intcnds to deem such matter
disa�,�proved or to deem such coildition not salistied, as o� thc date which is tive (5) days <itter tlie
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� dis�pproving party reccives such notice. If diapproving party fails to approve of or w�ive thc
mattcr in questiou or fails to acknowledgc thxt the coudi[ion in question is satisfied, as Ihe case
may be, within such five ($) day period, the matter or condition in question shall thereatter be �
conclusively deemed to be dis�pproved or notsatisficd.
G13. Comout�[ion uf Time If the time tix perlortnzncc uf any provisiun of lhis
Agreemcnt ends on a Saturcl�iy, Simday or fcdcral, stltc or legal holiday in the Governing
Jurisdiction, then such date shall automatically bc extendecl until 5:00 p.�u. on thc next day which
is not a Saun�day, Suuda�� or federal, state or legal holiday in thc Govcmin�; Jurisdic[ion.
614 Sw�vival of Terms. �
I'he terms and provisions of dlis ngrecmcnt shall survive the Closing and shall remain in ��
hill foxce and ettect lhercafter unless otherwise s}�ecifically pruvided in tl�is Agrcement. I
700. SPGCIAL PROVISIONS �
701. Develonment Nesh-ictiuns Notwithstanding provisions tor modific�tion or
amendment of instruments oC recurd to which Cos(co lias agreed its title tu thc Site may be
subject, any such modi�oatiou or amendment that changes the uses or dcvclopment permitted on
the Site or changes the restrictions or controls that apply to the Site or otherwise aficcts thc �ise
of the Site shall require Ihe prior written consent of Costco.
702. Amendments tu this Aereement Cosfco, Succcssur Agency and City aeree lo
mutually consider reasonable requests for amendments to ihis ngreement that may he made by
any of the parties hereto, Icnding institulions or bond cowisel or Yinancial consultants to City,
providcd such rcquests are consistent witli this Agrccment and would not subst�intiull}' altcr thc
basic business terms iiuluded herein. �
703. 13rokers' Cnmmissinns tiuccessor Agency shall bc responsihle for paying a
broker's coinmission in the amoiuit ol 'I�HKEI: HUNDRED THUUSM�D DOLLARS
(S300,000), to be paid �ri Closing, in equ�il shares to NWnP 11, Inc., and The Voit Coiporation �i
(Jason Gallelli). Successor Agcncy also shall pay a broker's commission ii� the amount of Three
Pcreent (3%) of the Purdiase Price, to be paid at the Closino, to Reaity World Seltzer Realty.
�'ity and Costcu e��ch represcni to Ihc othcr thnt it has engaged no otlier broker in connectio�i �
with the transactiotl set forth in this Agreement to �vhuin :i cominission is or would be payable.
800. T,NTIRI? AGRE[;MPNT, WAIVtiRS AND AMI?iYDMCN'LS
This Agreetnent is execuled in [our (4) �luplictite uriginalti, each ol'which is dectne�l to be
an original. l�his Agreement comnrises pxge.e 1 throu�h ;7, inclusivc, ncknowledgmenis and
� Attachmcnt Nos. 1 through 8, aUacl�ed hcreto and incorporuteci herein by rclerencc, �II of which
constitute the entire understauding and agrccmenl ol� the par[ies. 1'his Agreement intcgrtites all
oC the tcrms and conditions uientioned herein ur incident�l hereto, and supei�sedes all �
❑ego�iations or previous �grecmcnts betwecn ti�e parties with respect [o �II or an}� part �il the
subjcet matter hereol'. All waivers of the provisions of this Agreement must be in writing and
signcd by ihe appropriate authorities of Cily, Successor Agency and Costco, and aIl amcndments �
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' hcrclu nnisl bc in writing and signed by the appropriate autl�orities of City, Successor Agency
and Costco.
)U0. 1'IML P'OR ACCGY'I'ANCE OF AGKEEVIEVT I3Y CITY AND SUCCESSOR i
AGGNCY ��
This Agreement. �vhen execute�l by Costco and delivere�l lo City and Successor Agency,
must be authorired, exccuted and delivercd by City and Successor Agency within tN�cnty (20) ��
days afrer tlie date of si�?nature hy Costco or this Aareen�enl shall bc void, cxcept to the exlent �
that Cosico shall consa�t in writing to further extcnsions of time fbr the authoriialion, exccution
v�d delivery of this Agreement. 'fhc efYective date of this Agrccmcnt shall be the date when this
, Agreemcnt has bee�� signed by City and Successor Agency.
[SIGNn7�URLS OI� VGXT PAGE(S)�
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IU00. COU�TI?RPAR"CS; b'ACti1M11,I? SIGNA"CURI;ti �
l�his ilerccm�n� mn�� hr c.�ccu�cd in morc th<m onc counteipart, cach ol���hich shall b� �
ticemed an ori�inaL and all uf �>�hich togethcr shall constitutc one and the samc instrumcnt. �'
Facsimile ur o[hcr elec[ronically trmsmitted sign.ilures on this Agrcentent shall cunstilute
ori,�inals signaturc,� of lhc perlicti.
, I
' �� /`'I . 201� CIIY OP UKInII. I
a municipal corporetion
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Bv:� �. ��i�v �,� % I
.I� c Chamhcrs. C'it�� Managcr �
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nrc i•:sr:
, �/
�y: /�G�5 %)GI.L' �LG�D� _-LL�� �
Kri.stine Lawler. City Cleck
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CI'fY O1� UKI/�II SUC'CI;SSOR �GFiNCY �
I ���; �M..�__C'._ `��- �..
J4i�5e C'hambcrs, lixecutivc Uirectur
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�c�L'c�.�9�iE/u /_`/. 2U1 3 CUS'fCU WH(>I.F;SALG CORPURA�IION. �
�i Washi�tiatr�' rnti �
. I
13v:
�lC �� <J• �lu�L �
�r�i�: ����' c F �' rst , ��I�sct lE C���r�.
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A"�'TACHMEN'I' NO. 1 I
Ml1P OF �CI IE Sl"I�G
[Attached]
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uswsossts�oa is At�achment No. 1 �
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NORTB �
P.0.8. N84'40'22'E 585.28� ...
LOT 1 '
0 100' 200" 400' o
W N
Scale 1" = 200 ft �7 �q �_o�r c3 ��
�
LEGEND "�az °e4 --, -� �N
_, m
EXISTING PROPERTY LINE
EXISTING PROPERTY LINE
TO BE REMOVED
------- PROPOSED PROPERTY LINE — - —
_ - � SOS'21'28'E
SF SQUARE FEET 100.13'
AC ACRES z I
I
� �or Fto �01 G2
I
w CA2 D64 i CA2 D64 C I
m ��7� LOT 1 Fc7
D p 668,�21t SF N N
� f 15.29893 AC o =
� w � [� �
O J � C
A � �
o D - -- -- — g �
G � LOT F11 I CAO2TD64 A �
CA2 G64 �
� � =�p� ' -';-t
...i
C 50038'O6'W i
r ,oo.,s•
� S84'40'22"W . '.
----
--
D 102.89' ---_ _ '
� ��
v \� ��> P,4RCEL � o
���S j. D7� �GOG ni
� S. 4 �o
� N
� m
^� � S84'40'22�W
� �38.33� y o ,
� , � '� f
�
\ �� �.
��� \'� '�,
\ �� �
\ .�
/
84'40�22�W
103.48' ,
. _ ... _ . ��o.. _ -. - . - . . �_ r.v - __ � �
.,_ .+✓.�_.- I�C..rvP� ` _.. _ . ' ._.,...
SCALE 1" = 200'
�k KIER & WRIGHT nnTe io/zz/ia
CIVIL ENGWEERS & SURVEYORS, INC. LOT 1 BY � i
2850 Colller Canyon Road Phone (925) 245-8788 IOB N0. A09814—I
Llvertnore, Callfomla 94551 Fax (925) 245-8796
UHIAH, MENDOCINO COUNTY, CALIFORNIA SHEET 2 OF 3 ,
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aTTACxti���r No. z i
LI�;C;;AL llI�;SCIZIP'CION O�"I'HE SITP,
LANDS OF CITY OF UKIAH, SUCCESSOR AGENCY FOR DISSOLVED UKIAH
REDEVELOPMENT AGENCY, A PUBLIC BODY
LOT 1
REAL PROPERTY SITUATE IN THE CITY OF UKIAH, COUNTY OF MENDOCINO, STATE OF
CALI{=ORNIA, DESCRIBED AS FOLLOWS�
BEING ALL OF LOTS G1, G2, G3, F8 & F�0 AND A PORTION OF LOT F11 AS SAID LOTS ARE
SHOWN ON THAT PARCEL MAP M.S. 97-07 RECORDED JULY 28, 1997 IN MAP CASE 2, DRAWER �
64 AT PAGES 21 & 22, OFFICIAL RECORDS OF MENDOCINO COUNTY, TOGETHER WITH A '
PORTION OF PARCEL 1 AS SHOWN ON THAT PARCEL MAP M.S. 04-51 RECORDED OCTOBER 2,
2006 IN MAPS, DRAWER 74 AT PAGES 4 THROUGH 6, OFFICIAL RECORDS OF MENDOCINO
COUNTY, MORE PARTICULARLY DESCRIBED AS FOLLOWS:
BEGIIVNING AT THE NORTHWEST CORNER OF SAID LOT F$ ALSO BEING A POINT ON THE
EASTERLY RIGHT OF WAY FOR AIRPORT PARK BOULEVARD AS SHOWN ON SAID PARCEL MAP
M.S. 97-07�,
THENCE ALOVG THE NORTHERLY LWE OF SAID LOTS F8 & G3 NORTH 84'4022' EAST A
DISTNNCE OF 565 28 FEET TO A POINT ON THE WESTERLY RIGHT OF WAY FOR U.S. HIGHWAY
101, SAID POINT ALSO BEING THE NORTHEAST CORNER OF LOT G3, AS SAID HIGHWAY AND
LOT ARE SHOWN ON SAID PARCEL MAP M.S. 97-07�,
THENCE ALONG THE EASTFRLY LWES OF SAID LOTS G3, G2, G1 AND SAID PARCEL 1, ALSO
BEING THE WESTERLY RIGHT OF WAY OF SAID HIGHWAY, THE FOLLOWING FIVE(5) COURSES: I
1)THENCE SOUTH 02°29'45" EAST A DISTANCE OF 327,57 FEET, �
2)THf_NCE SOUTH 05°21'28" EAST A DISTANCE OF 100.13 FEEL
3)THf_NCE SOUTH 02°29'45" EAST A DISTANCE OF 400.04 FEET;
4)THENCE SOUTH 00°38'06"WEST A DISTANCE OF 100 19 FEET�, I
5)THENCE SOUTH 02°29'15' EAST A DISTANCE OF 530.19 FEET�, �
THENCE LEAVING SAID EASTERLY LINES AND SAID WESTERLY RIGHT OF WAY, SOUTH
84°40'22"WEST A DISTANCE OF 103.48 FEET;
THENCE NORTH 31°37'13"WEST A DISTANCE OF 249.94 FEET;
THENCE SOUTH 84°40'22"WEST A DISTANCE OF 38.33 FEET;
THENCE NORTH 32°45'47"WEST A DISTANCE OF 33t26 FEET; �,
THENCE SOUTH 84`40'22" WEST A DISTANCE OF 102.89 FEET TO A POINT ON THF WESTERLY '
LINE OF SAID LOT F11, SAID POINT ALSO BEING ON THE EASTERLY RIGHT OF WAY OF SAID
AIRPORT PARK BOULEVARD,
THENCE ALONG THE WESTERLY LWES OF SAID LOTS F11, F10 & F8, ALSO BEING SAID I
EASTE-RLY RIGHT OF WAY, NORTH 05'36'44" WEST A DISTANCE OF 937.97 FEET TO THE POINT �
OF BEGINNING CONTAINING 15.2989 ACRES OF LAND, MORE OR LESS.
�isw sn.�s i;ao�-is
izi7rzm� Attachment No. 2
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a'rrnctiti�r:��r�o. 3
SCHL:DUI.h: OF' Pr:RFORMANCC
ACTI ON I)ATF,
Gxecution and Dcliver��of n�reement bv P ither prior to Ci[y Council meeting to
Costco. Costco shall executc and consider approvel of this ��grcement or within
delivcr Ihis Agrcemcnt [o Cily. ten days aCter �pproval by thc City Council and �
lhe Successor l�gency. i
['l?n�gei do�e� By Dece�nber !3, 20/3J i
Annruval of[�grecment by Ci[v. City Couucil llecembcr, 2013.
shall hold a public hearing to authorirc /l'urge� dnle: Decenaba• 18, 2013J
execution oC lhis Agreement by City.
(Section 900). �
N;xccution of Aereement bti� Citv. lf so Within twent�� (20) days execution ol �
autl�orized, City sliall cxecutc. datc Agreement by Cos�co.
("EffeCtive ll8te") �nd delive�r tliis [Tnr•ge� ��tn7e.' 13y Januu�_v 17, 201 dJ
Agrccmcnt to Costco. (Section 900).
Public Im rP �vcmcnt h'.ngineerin�Pl�ns. ('ity Within thiit�� !=0) days aftcr I[fTectivc Datc ur
shall coordinate witl� Costco and later if morc timc required to get Cal Trans
prc�arc plans ior City Work. (Scction �ipp�'ovaL
205.le). �/'a�'ge!c/nie: By Jnnziary 16, 2014J
O�iening oi�scrow. Costco shall opcn an Cotnpleted.
cscrow for conveyance uf tl�c Sile to
Costco (Section 202), and deposit die
Deposit tlierein. (Section I04).
"fitic Commitrncnt. Costco sh.ill obtain lhc �'umplctcd.
Title Commitment lrom thc �I�itle
Company (Section 306.1).
Survey. Costco shall obtain an AL'CA Survcy C'umpleted.
of the Sitc (Scction 20E2).
Iluildin� Permit SubmitttiL Costco Submits Within sixty (60) days aCtcr E?ITcctivc Date.
final plxns for building permiL_(Section ("Iui��e[du�e: Decemher 3/. 2013j
30I 2). [Ftdl GO clu)'s ivuid�!Le lule�J I
USW 80}51`SO4_IB .
iv3rzoi3 Aua�chmenl No. 3 �
I
nc noN n.a r� ---
Title Inspection Period. Costco shall inspect Within sixty (60) days after Gttec[ive Date.
thc 'I�itle Commi�mcnt and Survcy and �furget c(nle January l6, 2014J
❑otifV City of any Title Olijections. �l�rd/GO drrys�roiJd b� larerJ
(Secliou 2063).
Costco Permits. Costco sl�all oblain necessary W��hin one hundred twenty (120) days artcr
governmental permits(County I lealth, ��ffective Date.
Caltrans, Dept. of Fish & Gamc. ["/'arget dn�e� Nfcu�ch 3l. 20l dJ
RWQCB, etc.). (Section 20J.1c). (l�id/ 120 dn�as iaavJd he lnle�J
Building Permit. City notifies Costco building
pennit for development of Site is ready �'<<hin ninety (90) �lays aCter Custco submits
for issuancc �ipon payment of f nal plans.
applicable 1'ecs. (Scclion 301.2). [7�ar,�=er dale� L3��A�arcl� 3/, ZO/�1J
Citv I�inancin . City to dcliver to Costco all
docwnents conditioning or Within sixty (60) days atter thc F.ffective Date. �
implementing the Financin� [1'a•get dnte: i-i+l�en requb•ec�b�� loan lermsJ �
Mechanism. (Scctions 205.1 g and
302.3).
Costco /�ppioval of Citv b'inaucin�. Costco
sliall rcview and approve auy �✓������� ten (]0) business days aftcr dclivery oC
conditions of the Pinaneing Mechanism T���iding Meclianism documents [o Costco.
and issue��inancin� U'aiver Notice.
(Scctions 205.1 g ancl 3023).
I,on Ig tan '�e Pi_oPerry Manakement Plan
ApqrovaL City to deliver evidence of W ithin seve�ity-five (75) days CtYective Date.
Oversighl Bo�rd, �)ept. of Finanec and �Tn�;��el cliue: B�; i1�cn-ch 3. 20/-/: 7� da�,y
any otlier approvals necessli'y for tivnide!be Ic��e�J
Successor l�gency to convey Site to
L'ostco. (Sections 2U5.1 h and 214.1 i).
Deposil of Grant Dccd. City sl�all d�posit tlie
Grant Deed and other requircd
docwncnts into escrow. (Scction ?07).
Llpon satisfaction of foregoiug Actions.
[Tar�;e� dn�e: Mnrch 3, 2014f
Attachment No. 3
US W 8015 Li304.I S '�
12/3/?OIJ 2 ��
I
AC"I'ION llA�fE
City Work Anp�'ovals. Cily obt�iins CG(2A and I�SAY.
all othcr permits and appro��als for City /Targc[date: �fciy ?l; 201{J
Work. (Scctions 205.1e and 205.2c).
13id on Ci�Work. City shall advcrtise Y�or bids
lor construction of City Work. (Section Upon CGQA Ccrlilicalion for City Woik. �
20�.Ic). [TarReldure� I3vdlay?l; 20IdJ �
Cl�ip,4 Stariite Runs. iime for Ylling judicial �
challcn�e of final Ch:QA action (dd16) �I'hirty (30) days after tiling NOD after City
runs, assume no challenge. (Section certiticatioi� of I�I:IR.
205.1). �Turger dare� By./crne 23. 20l-1J
Gcneral Waiver Notice. All of Costco`s
conditions to Closing shall be satisfied Within tcn (10) days a11er sltisfaction m�
or waivcd, including thc Financing waiver of atl con�litions.
WaiverNolicc. (Section 205,1). �Tar,eetdare:Jame Z�, ?OIQJ �
[Fidl !0 duy.r a�ntJd be.Iiilv 3. 2014J
Access Pinancin�. City arrangcs draw
schcdulc for Pinancing Mcchanism.
(Section 302.3). Upon reccipt of Gener�il Waivcr No(ice. �
�Tn�;�e� �la�e June 2�. ?01 d�
Award oFContract on Citv Work. City shall il
havc opencd hids and awardcd contract
Cor eonstruction af City Wnrk. Upon receipt ol Gcueral Wai��er Notice.
(Section 302.1). �l'cuger dcue: Jarne 25. 20/4J
Commencemcnt of Cunsu'uction uf Ci�v's �
Work un Pu�ilic Improvements. ('it}'
shall commence the work spcciticd in witllin five (5) b�iaincss days after award of
this Agrccmcnt and thc Scope of conlract lor City Work i
Develupmcnt (Attachment Vo. 4) to be [Tru�get da�e: June Z5, 201 Ff
perf�rmed hy City. (Section i02.1).
Denosit of Purchlsc Pricc and Other Reuuired
Sums. Costco sl�all dcposit ihc
Purchasc Price and other required sums
and documents into escrow. W'ithin len (10) days aftcr City commences
(Sectioi�208). construction of Puhlic �mprovements.
%Carge! dale: Jzr!}� 7, ZO[�JJ
nttachment No. 3
USW 803515304.Ift
izi3izoi 3 3
I i
A C�f I ON DA"I�E
Closii�)a[e. Cscro�� Agent shall record the Within thirty (30) days aftcr City commcnces ;
grant deed and Memorandwn of construction of Public ]mpruvcments.
Agreemeut, make all other (Tcn•get dn�e: Jidn ld. 201-1J
disbursemcnts and take all other action
necessary to conveyauce of the Site to
Costco. (Section 202).
Commencemcnt of Construction of Costco W itliin ninety O0) days after conve}'ance of
Proicct. Costco shall commcncc thc Sitc by City ro Costco.
cunstrucliuii uf lhe improvemen[s to bc [Tcirget dule: Juli� 28, 201 d� �
constructed on the Site. �h'ul! 90 ilays�vnuld he Octoher 22, 2014/
(Section 30L4).
City•s Completion uf Public Imo�ovemen[s. Within onc hun�lred forty Q40) days after City
City shall complete [he wark speci ficd commences the work.
in lhis tlgreement and lhe Scope ol /Tu�,�e� drue: Nuvemher l2, 201d/ '�
Dcvclopmcnt(Attachmcnt No. 4) to bc
perlurmeil by City. (SecUun 302.1 ). �
C��letion of Construction of the Costco W ithin 12 months altcr commcncement
Pro cct �'ostco shall complete thcrcol by Costco.
construction of llic improvements tu be �frn�et dare: Febraary or A4m�ch, 2015J
coiistructed on the Silc. (Scction [Firll 12 nronths tirozrld be Jady 38, 2015J
301.4).
Issuance of Certilicate ql Oc�cupancv. Gity Promptly �Cter completion of all coustruction
shall furnish Costco wiQt a Certificste required lo be complctcd by Costco on the
ofOccup�ncy. (Section30Ll). Sitc.
[Tcu'gel d�de. Febrt�ur��ur M�u'clt, 201�J
I
I
Attachment N o. 3 �
u�w sni;i;;na ix
iz�3imi 4 4
. l
�
AT�racx�rcvT vo. a �
scoF��, or• ll�;v�LO��MLN�r
I. PRIVATGDEV�LOPMI-:N"I
n. General
Costco agrees that the Site shall be devcluped and improved in accadance with the
provisions of this A�recment and [he plans, drawings and irlated docitment� approvcd by City
pursuant hereto. Costco and its supervising architcet, ci�gineer and contractor sh�ll work with I
City stalf to coordinate the overall design, architcchn�e and color of the impro��ements on the
Sitc.
I3. The Proiec[
Coslco shall construct, or causc to bc constructed, on thc Sitc a Costco membersltip
warehousc rdail store of approximately one hundred forty-cight thousand (148,000) squeu•e feet, �
as weli as a veliicic fueling slation ol up to twenty (20)fueliiig positioiis (the "Project"). �I
C. Architccturc and Dcsian
The Project sliall be of high archilectural quality, sh�ll bc N�ell landscaped and shall be �
eflcctivcly and aesthetically designed. Tlie shape, scale of volume, exterior design and exterior
tinish of the building must bc consonant with, visually rclatcd to, physically related to and an
enhxncement uf adjaceni buildings within the Redwood I3usiness Park. Costco's plans submit[ed
to City sl�all describc in detail ihe archilectural ch�racter intended for The Project.
ll. Landscan«ie �
l.andscaping shall embellish all opcn spaccs upon tl�e� Sitc to inlegr��te the Project with �
adjacent sites within the Redwood 6usiness Park an� comply with Che Site Development Permit ��I
issued by the City. I,andscaping includc.e such matcrials as paving, Irecs, shrubs and other plant !
materials, lanilscape containers, pla�a furniture, top soil preparation, automatic irrigation ��nd I
Inndsceipe a��d pcdcstrian lighting Landscapinp shaill carry out thc objcetives and principlcs of �i
City's desire to accomplish a high yuality tie,thetic enviroi�meut. �
h:. Sians
�II signs on the exterior of the buildings a�'e ol spccial concern to City and must be
approved by City in accordauce with its Sign Ordinance and applicable City sign standards any
varianccs thcrch�om lhat may bc approvcd (which appi'oval shali not bc uurcasonably withheld).
C. Screenina
l'rash areas shall hc screened on at least threc (3) sides and havc movable doors nr other
devices [o obscure such areas from vie�m�. All Yire standpipes a��d such other firc related
mechanical dcvices sliall bc scrcencd with plant mnterials. Rooftop equipment shall be �
i:sw en�sis+na i.e
iznaoi; Attachment No. 4
1
_ _ __ _ _ i
�
,
reasonably hidden so as to mitigate vicws Yrom principnl clevalions surrounding thc �
dcvclopment. �
G. Apolicablc Codcs
I
The Project sl�all be coi�structed in aceordauce with the California Building Stan�lards '��
and related Codes (with City modifications) and the llkiah Cit}� Code.
I I. SI'fG C'L�ARANCC AND PRCPARATIOV
Costco shall perfonn, or cause to bc performed, at its solc cost and cxpense, the following �
work:
A. On-Site Demolilion and Clexrance
�
1. On thc Sile, dcmolish or salvaga cicar, gruh and remove (as may be �
needed and called for in the approved plxns) afl on-site buildings, pavemenls, walks, curbs, �
guttcrs �nd other improvemeuts; and �
2. Rcmovc, plug and/or crush in place utilitics, such as stonn sewers, ��
sanit�ry sewers, water systems, electrical ovcrhead and iuiderground systems and telephone and
gas systems located on the Site, as may be required following any nccessuy relocation of the
utilitics.
B. Comuaction, Pinish <n'adin� and Site Work
Cuslco shall coiupact, linisL grade anQ du such site prepeirutiun us is necessary lor the �
consh-uction nfthe Project on ihe Sitc. li
111. PUBI,IC IMPKOVI:'MH:VfS
Cit�� shall periorm, or cause to be perfonned. the wod< as depicted on attuched sketch of
Olisite Road Improvements and other Public Improvements required as a condition for Costco to
obtain its Certificate of Occupancy. 'I'he �lesigu dctails for thc Public Improvemcnts are subject
to revisions that (l) do not stibstantially reduce their effectiveness in facilitating traFlic flow to �
and Gom thc Site, or (2) nrc agreed upon by the pariics or(3j as m'e necess�ry tu obtain approval
fi�om the California Deparm�ent of TransE�oitation (Cal Trans).
[Puhlic Improvcmcn� cxhibit PDI� attachedJ i
Altachmcnt No. 4
i�sw xn;si;ina ia '
i�ni�ni; 2 I
I
AT"I�ACI IMI�:N"1' NO. 5
FORM OP URANT DH:F.D �
RF,COKDING REQUF.S'I'I�:D I3Y ��
AND WHEN RECORDI:D MAIL CO:
Costcu Wl�olcsale Co�por��tiou
999 1 rake nrive
Issaquah, ANA 98027-5367
Atm: Property Manlgemcnt/I.cgal Department
/�PN: — _ _ _
GRnN'f UI;I;D
For valuable consideration, the receipt and suificicncy of' which arc t�ereby '
aduiowledged; the City ol� Ukiah, �+ municipal corporation Qierein callcd "Grantor"), Itercby
grants to COS�I�CO WHOLGSf�1.E CORPORATION, a W�ishington corporation (l�crein called
„Grantce"), the real property (the "Site") le�,�illy describc�l in �he document attachetl hereto.
labeleil Gxhibit 9, and incorporated herein by Ihis reference. �
1. The Site is convcyccl sub.ject to instruments of record.
2. fhe Grantce covei�ants by and for itscll and any suceessors in interest that there
shall be no discrimioation agaii�st or segregation of any person or group nf persons on aecount of �
race, color, creed, religion, scx, marital status. national origin or a��cestry in the sale, lease.
sublease, transfer, use, occupancy. tcnurc or eqjoyment of the Site, uor shall the (irantee itseli or
aiiy p<a�son cfaiming under or throtigh it estublish or permit any such practicc or practices of
discrimination or segregation widi relerence to the s�lection, loeation, n�miber, use or occupxncy
ot tenants, lessees, subtenants, sublessees or vendecs in the Site.
iA(1 deeds, leases ur contrlcts made relatice to the tiite, the improvemeots thcrcon or any
pvrt d�ereof shall contain or be subject to substa�tially ihe Following nondiscrimination clauscs:
a. In dccds: ""l�hc granlcc hcrcin covcna��ts by and fm� himsclf or l�crself, his
ur her hei�s, execulurs, administra[urs, a��d assigns. and all persons claiming under or through
them, th�t there shell be no discrimination ngainst or segrcgalion of any person or groun of
persons on acco�int ol��ace, color, creed, religiou, scx, marital status. national origin or ancesu�y
in thc salc, Icasc, subleasc, transl�cr, usc, occupancy, tem�re or eiijoymenl of the premises hcrcin
conveyed, nur shall lhe �runtee, ur any person clai�niug under or through him or her, establisli vr ��
permit any such practice ur practices of discrimination or se�rega[ion with reference to tlie
selection, location, number, use or occupancy o� tcnants, lessees, sublenants, sublessees or
vcndccs in the prcmises hercin conveyed. The foregoing covenan[s shall run with thc land."
6. In leases: "The Icssec herein coveuants by �ind (br himself or herself, his
or her heirs, executors, administrators and assi�}is, an� all persons claiming undcr or tlu�uugh him
or her, and this lease is made and accepled upai �nd subjrct to thr lollowing conditions: That j
USW 8035 G304.18
ivaizois /�llachincut Nu. 5
I
�
I
there shall bc no discriininrtion �gainst oi' segreaetion of any person or group ol� pers<ins on
account of race, color, m�ced, religion, scY, marital status, nalional origin or anccstry in ihe
leasirig, subleasine, transYcrring, use. occupancy, tcnurc or enjoymcnt of thc premises ha�ciu �
leased, nor shall tl�e lessee himscll ur herself, ur any person claiming under or through him ur �
her, cst�blish or permit any such praciice or piactices of discrimination or segregation with
reference to thc selec[ion, localion, number, use or occupancy of tenants, lessees, sublessecs,
subtcnanls or vendees ii� tl�c prcmiscs l�ercii� Ic2scd."
c. In cuntracts: ""I�here sh�ll be no discrimination against or segreeatioii uf �
any person or group of persons on �ccnunt oF race. cola', creed, religion, sex, marital status,
national origin or ancesu'y in the sale, lease, sublease, transfer, use, occup�ncy, tenw•c or �
cqjoymcnt ol thc prcmises, nor shall thc U�tnsferec I�imself on c�rsclf, or any person claiming
' uuder ur lhiuugh him ur her. esl�blish or pennit auy such practice or practices of discrimination �
or segregation with rel�erence to the aelcction, location, number, use or occupancy of tc�anrs,
lessecs, sublessees, subtenanls m' vendees in the premiscs."
3. No violation or breach of the covenants, cunditions, restrictions, pro��isions or �
limilalions contained in tl�is G�ant Deed sl�all dcfcat or render invalid or in any way impair thc
licn or charge of atry mort�age. �Iced of trus[ or other Yinancing or security insirumen� permitted
by this Agrecment, providecl, howevcr, that any successor of Grantcc lo the Site shall 6e bound
by such rcmuining covcnants, conditio�s, restrictions, limitations and provisious, whethcr such
succe,sor's title was acquired by foreclosure, deed in lieu of foreclosure, trustec's sale or
other���isc.
4. fhe covenants a�,ainsl discriminatinn contained in tl�is Crant Deed shall remain in �
perpetuity. shall be binciing for Uie benefit of' tha Grantor, its successors and assigns, and any
successor in interest to the 5ite or any pait ihercoC and shall run in favor of thc Grantor and sucli
a(orerncntiuned parties lor the cnlire perio�l during wl�ich such coveuants sliall bc in Corce and
cffect, without rcoard to whether tl�e Granlor is or rem[�ins an owner of any land or interest �
thercin to wliich such covcnants relate. 7�he (irantor and such aYi�rementioncd parties, in the �
evcnt of any brcach of any such covcnai�ts, shall havc thc right to excrcisc all of the rights and
remedics and Lu maintain tuiy aclions at I�iw or suits in cyuity or other proper proceedings tu I
enlorce the curino of such hreach. The covcnants contained in this (irant I)ccd shall he fnr the �
beiictit of and shall be enforceable only bv the (;rantor, ils successors and sucl� aforementioned
partiea '
I
� Atiachmmit No. 5
i,sw sn:�s i sio�i s
izan_oi� �
' 1N WI'ITF,SS \�'II1=RIiOP, the Grantor and Grantcc hace caused this insirumcnt to bc
csccutcd on thcir bchalf by their respcctivc ot7iccrs thcirumo duly �uthorizcd diis i
dac of . 201
CI'IY OP liKlAll SCCCI?SSOR nUF.VCY.
.i municipal curporation
f3y:
Executivc Director
Ry:
Sccretarv
"GR��\TOR" I
°CiRAN'fOR" �
Coui�sel lor Grantor
fhe provisions of this Grant I)ccd .u�c hcrcbv aE�pro�cd and acccptcd.
COS�I�CO WI IOI.I?SnLI? CORPURI��IION.
u Vdashineton corporation
13v: '
I�itle: �I
"G RnN"CL?I("
il
nuachmcnt No. �
I;tiN'R02?IS3U+JA I
i ziai?o r+ 3
� acxNOwi_H.i��ME�v�rs �
I
Attachment No. 5 �
CSN'S0.9$I i104 IX
iznaoi� Acknnwledgcments
F:XHlI3["1' .4
Lk;G:1L DGSCRIP"fION OP THIi S1TIi �
I
LANDS OF CITY OF UKIAH, SUCCESSOR AGENCY FOR DISSOLVED UKIAH
REDEVELOPMENT AGENCY, A PUBLIC BODY
LOT 1 II
� REAL PROPERTY SITUATE IN THE CI-IY OF UKIAH. COUNTY OF MENDOCINQ STATE OF CALIFORNIA, �,
DESCRIBED AS FOLLOWS: i
BEING ALL OF LOTS G1, G2 G3, FB & F10 AND A PORTION OF LOT F11 AS SAID LOTS ARE SHOWN ON
. THAT PARCEL MAP M.S. 97-07 RECORDED JULY 28, 1997 IN MAP CASE 2, DRAWER 64 AT PAGES 21 & �
22, OFFICIAL RECORDS OF MENDOCINO COUNTY, TOGETHER WITH A PORTION OF PARCEL 1 AS .
SHOWN ON THAT PARCEL MAP M S. 04-51 RECORDED OCTOBER 2, 2006 IN MAPS DRAWER 74 AT
PAGES 4 THROUGH 6, OFFICIAL RECORDS OF MENDOCINO COUNTY, MORE PARTICULARLY
DESCRBED AS FOLLOWS: i
BEGINNING AT THE NORTHWEST CORNER OF SAID LOT F8, ALSO BEING A POINT ON THE EASTERLY
RIGHT OF WAY FOR AIRPORT PARK BOULEVARD AS SHOWN ON SAID PARCEL MAP M S 97-07;
THENCE ALONG THE NORTHERLY LWE OF SAID LOTS FS & G3, NORTH 84"40'22" EAST A DISTANCE OF
58528 FEET TO A POINT ON THE WESTERLY RIGHT OF WAY FOR U.S. HIGHWAY 101. SAID POINT HLSO
BEING THE NORTHEAST CORNER OF LOT G3, AS SAID HIGHWAY AND LOT ARE SHOWN ON SAID
i PARCEL MAP M.S. 97-07.
THENCE ALONG THE EASTERLY LINES OF SAID LOTS G3, G2, G1 AND SAID PARCEL 1, ALSO BEING
THE WESTERLY RIGHT OF WAY OF SAID HIGHWAY THE FOLLOWING FIVE (5) COURSES:
1) THENCE SOUTH 02°29'45" EAST A DISTANCE OF 327.57 FEET;
2) THENCE SOUTH OS°21'28" EAST A DISTANCE OF 100.13 FEET;
3)THENCE SOUTH 02°29'45" EAST A DISTANCE OF 400.04 FEET;
4) THENCE SOUTH 00"38'06`WEST A DISTANCE OF 100.19 FEET;
5) THENCE SOUTH 02°29'15" EAST A DISTANCE OF 530.19 FEET;
THENCE LEAVING SAID EASTERLY LWES AND SAID WESTERLY RIGHT OF WAY, SOUTH 84"40'22" WEST
� A DISTANCE OF 103 48 FEET; ,
THENCE NORTH 31°37'13"WESTA DISTANCE OF 249.94 FEET,
� THENCE SOUTH 84`40'22" WEST A DISTANCE OF 38.33 FEET;
THENCE NORTH 32"45'47"WEST A DISTANCG OF 33126 FEET; I
THENCE SOUTH 84°40'22" WEST A DISTANCE OF 1D289 FEET TO A POINT ON THF WESTERLY LINE OF I
SAID LOT F11, SAID POINT ALSO BEING ON THE EASTERLY RIGHT OF WAY OF SAID AIRPORT PARK
BOULEVARD,
THENCE ALONG THE WESTERLY LINES OF SAID LOTS F11, F1D & F8, ALSO BEING SAID EASTERLY
RIGHT OF WAY, NORTH OS°36'44" WEST A DISTANCE OF 937.97 FEET TO THE POINT OF BEGINNING.
CONTAINING 15.2989 ACRES OF LAND, MORE OR LESS.
UtiW 80351i30�iJ8
izianoi� 1-:xhibit A
I
— _ _
�rrncxM�niT�o. c
CI'1'Y/SUCCCSSOR �\GE�ICY ENVIRONM1-;N'l'.4L DISCLOSURES �
The only disclosures arc containcd in thc Phase I 6nvironmentnl prepnred for the iormer Ukiah
Kcdevelup�rtent ngency o� July 3I, 2009, by A�S Due Diligenec, Inc., previously iiu'nished to
Costco and t�vailable for rcview at httns�//citYOfukiah.box.com/s/ckbt550nktszqjrnc9u0.
I
iis��so3si�aoa.is Atttichment No. 6 �
i
I` _ _ __ _ _ _ _
A"1`CAC'HYlLN1 NU. %
F;XCUSIVI; USL COVGNAVT
Ncithcr City, nor any subsidi�ry, aftiliatq p�ircnt or otl�cr cntity thut controls, is controllcd by, or
is under common control wilh City �collectively "City's Gnlilies") shall. dircctly or indirecUy,
with respect to all or any portion of any properry cui��ently or iu Ihe future owned hy City or any
of City's F.ntitics within ten (10) miles in all direction from the exteriur bouncllries of the Site
(the '9testricted Property"), (i) sell, lease or otherwise transfer 111 or any portion of the Restricted
Property to, or for use as, a wl�olcsale ur ret�iil general mercliaudise facilily tliat h�s a I
merchandising couccpt hased up�n a relatively limited numher of.�tnck kee�iing units in a large
ntimber of producl categories (the "Mercliandising Concept"), (ii) sell, lease or otheiwise transfer
all or any portion of thc Rcstrictcd Property for usc as e grocer�� storc or supermarkct lhat
primarily sclls food pruducts i❑ bulk quantilics (a "W'holeyxle Grocer"), or (iii) sell, lease or
otherwise transier all or auy portion of the Resh�icted Property to any party to s�iliport e facility
operating either under the Merchandising Concepl or as a Wholesule (irocer (i.e., for parking or
othcr necessa�y improvements for such a facility; oi (iv) scll. lease or othcrwise transfer all or
any porliun of llic Resu icte�l Property tu any pa�1y for usc as a "Wal-Mait" store or "Wal-Marl
Superccnter" �ir nny otl�er storc operatcd undcr the "Wal-Mart" brand; provided, howevcr, that in
uo ece��t shall any of the foregoing prohibitious prohibil the Rcstricted Nropert}� 5�am being used
for or as a Costco Wholcsalc wlrchouse club or anq otl�cr f<�cility then operated by Costco or by
any s�ucccssor lu Cuslco (collcctively, a "Custco Pacility"). 'll�c furcgoing prohibilions incluQc,
but sl�all not be limited to: (a) any b�isiness that operates as a warehuuse cluh (othcr than e �
Costco 1•acility), (b) any business operated under the iradenames ol Sam's, 13J's, Jetro, Yrice
Smart or Smart t�nd Fint�l, and (c) nny business (otlier Ihan � Costco Pacility) similsu to thosc
uperuted undor �hc tradenames Costco, Sam's, B.I's, Price Smart, JeUa a� Sme�rt and TinaL This
covenanl shall be binding on the Resu�icted Property and Costco shall have the right to record a
docwi�ent containing this restrictive covenanl agninst any Restricted Property (wl�ether currently
owned or <�cquired altcr the dare hereof by City or any other of City's F,ntilies) and City (or other i
Ciq�'s Entitie5, as applicable) shall cooperate with Costco in recording such document. City, ou I
its own bchalf� and on behalf oi' each of City'; h:ntiiic�, acknowledgcs that the breach of the I
torcgoing restrictive covenant may ca�ise immediate and irreparable l�arm for which damages are
not an udequate remedy and tl�at. [o protect against such harm, Costco may seek.md obtain Ii�om
a court of competent jurisdiction the issuance of a i�estrninii�� order or i��junction to prohibit any
actual or tlu�eatened breach. Such an actiou for a restraining urder or injunction is in addition to j
and does not limit any and all other remcdies provided by law or equity. i
usw so,si;3aa is
, iziai�oi3 /�Lladimcnt No. 7
I �
nT�rncri�i���r no. s �
1�ORM OI' MEMORt1NDUM 01� AGRLf;ME�'"f
Rl CORDING RI?QU]?S�I�FD I3Y ��
AND WHP,N RGCORI)I:D MAIL 'f0: �
Costco A�'holcsalc Corporation
999 Lake Dri��e
Issaquah, Wn 98027-53G7
Attn: Scth S. Katz
Corporate Counscl
nl'N:
VIEMORANI)U�1 OP AGRI�:I�:VII;A"I� �i
�l IIS MI:MORn'VDUV( OI� nGR1�:EVII�:N�f (..'Vlcmurandum'�) is madc ns of dic �
dac ol . 201 . bv and bct���ccn tlu Cit�� o( l�kiah. n municipal corpuration
(hcrcin callcd "Ciq"), and COSTCO WIIOLGSnLi? CORPORn�f10N, a Washington �
coiporuion (hercin callcd "Costco"). with reference to the fact sct forth bclow.
Cit�� and Costeo lieretofore hti�e entercd into that certain :�grecmcnt d�ted
20] . (thc ..ngrecmcnt") lor thc s�le by Ciq- to Costco and thc �Ic��clu��ment by Cosuo ol thc
real pro�erty (thc "Site") le�ally dcscribc�l in the documcnt auachcd hcreto, labeled F,shibit A,
and incorporated hcrein b�� this refcrcnce. Certnin tcrms of the �Agrecmcnt espressl�� siu'��i��e thc
cum'c��ance of du Site pursuant ro the Agreement. �I�he parties heretu ��°ish to record this
Vlem��randum to give noticc oC said ngreement and specifically certain tenns thercuf that
suivi��o thc coi�vevancc, as set forth bclo�c:
l . l�ransfers Prior to Ccrti�lcatc o1�Qccu �anc��. �'itho�it thc prior w�rittcn conscm ol
City. �irior to issu�inee of thc Certilicate of Occupancy. Custco shall not directly ur in�lirectly.
voluntarily or im�olimte�rih� sdl. assign. u�ansfcr, disposc ol or fiu�thcr cncumbcr or �igrcc tu sclL ��
assien. u�ansfcr. dispose ol or lurthcr cncumhcr or suffcr to c�i�t am� othcr lirn against all ur am�
portion of or ��n�� interest in the Site, cxcc��t for anr s<�Ic or u'ansicr that is espressly permiUC� by
the terms of Agrecment: provided. ho���c��cr. Costco is t� puhlicly-u'aded company and an�-
changc in o�cnership of Cosuo�s publicl��-Uade�l capital stock shall not constitute an assi�nmcnL �
salc. transfcr, changc in o��ncrship or othcr uansaction }�rccluded bp thc forcgoin� restrictions.
nlso notwithstanding anything in thc Acrcemcnt to thc contrary, Costco shall be entiticd to �
�issign Costco's right. tiUc and inlrrest in the Site. ��'ithout City's consent. (i) to a subsidiary. �
al(iliatc or parcnt of Costco or an)� othcr cntih' �chich controls, is controllcd b}� or is undcr
common conu'ol with Costco, provided Costco shall not he rcicascd h'om its obligations ur
liabilitics hcrcundci: (ii) lo a succcssor of Costco as a resuh oCa mcr��cr or consolidution: or (iii)
to a limited liabilit�� compan�� thc mcmbcrs of ���hich include e� majorih� composc�l of Cosuo
and,''or cntitics conu'ollcd b��. controlline or imdcr common control ���ith. Costco.
2. O�tion "I'o Rc�nn�chl5c Prior to Ccrtificutc of Occut�ancv. Costco hercby grants to �
City the option to repurchase the Site �nd �ll impro�'cmcnts subscqucntl�� constructed thercon �
utiw sa?;is�oa_is
ei3rzni; Attachmcnt No. 8 �
�
I '�
upon lhe Icrms aud provisions more fttlly set lortti in Scction SOti of ihe Agrecmcnt, which
provisions urc incorporcited herein by lhis reference thereto. /�s more fully provided in such
Section 50(i:
a. I�he term of the opliun shall commence upuii thc recordaliun of this I
Memorandum and sl�all conlinuc unti] issuance of tbe Cartificalc of(�ccupfmcy.
b. I�hc option shall be excrcisablc by' City in each and evcry one of the
follo�ving circumstanccs:
(I ) Costcds failure to conunence construction of approved
improvemcnts on the Site hy thc timc specitied in Attachment No. 3 of the Agreement, for any
rcason wha[soever, subjcct to notice pursuxnl to Section 504 uf the A�reement and extcnsion
pursuant lo Scction 604 of thc Agrecmcnt; for purposes of t6is provision, Costco sltall bc deemed
to 'bommence cousti'uction" when and only when Costco has commenced ro�igh grading on the
Site pursuant co a permit issued by Cit}� fm� [he cunsh�uction of the improvemenis provided for �
the Agrcement; or I
(2) Once amstructiou lias been commenced in acca�dance �vith
suhparagraph (1) above, abazidonmcnl or substantial suspension of construction o1' the
improvements [hrough com��letion N�here such nbandonment ur suspension has nol becn cined by
a resumption of work within ninety (90) d�ys after written uotice of such abandonment or
suspcnsion from City, subjcet to cxtension pwsuant to Section 604 of this Agreement; or
(3j Thc violation by Cos�co ol thc restriction on transfcr sct forth in
Paragraph 2 of this Nlemorandum. �
c. (,ity'c ���tion shall be subordinatc and subject to and be limitcd by and �
shall no� dcic�t. render invalid or limit:
(1) Any morl}�age, dccd of lrust ar other security insU�wneut permitted
by this Agreement; or
(2) An� rights ar interests providecl in this .ngrcemenl for the
protection ol thc holde�r of such mort�ages, dceds of u'ust or other security insh�uments, or
(3) f1n}' utility or other easemcnls or pennits granted by Costco to
facilitatc thc dcvclopmcnt of tlie Silc in accord�ncc with �hc Scope ot Dcvclopmcnt.
3. The coveuants eontaiiied in this Memorandum shall be binding for the benefit of
the C'ity, its suceessors and aissigns, and any successor in interest to the Site or any part thereof, �
and such co��enants shall run in favor of the Ciry and such aforementioncd partics Yor the entire !
period during which sucl� cove��ants sliall be in force aiitl cffect, without regard tu whether thc
City i� or re�uains an owner uf auy land or inlerest lherein to which such covenants rcfate. The
City tind such aforementioncd p�rties, in die event of any hrcach of any such covenants. shall
have thc righl to exercise all of thc rights and remcdies and to maintai�� any actions at law or
suits in eq�iity or other proper proceedings to enforce the cw'ing of such breach. Tlic coven�nts
Attachment Vo. 8 I
Cti W RU351 S OJ I 8
I2/32013 Z I
�
i ,
I
contained in this Mcmor�ndum shall be for the hcnclit of und shall be enlorceable only by thc
City. its successuis and such aforcmendonc� partics. i
�l. ilnvmodification or amendmcnt oi any insu-umcnt ofrccord to whicl� Costco Iias
agrccd its title to tl�c Site may be suhject aud ���hich changcs thc uscs or de�elopment permitted
on the Site or chan�_es thc res0�ictions or conu�ols th<rt appl�� to the Sit� or othcr�cise t�flccts the
usc ol thc Sitc shall rcyuire the prior ��rittcn consrnt of Costc��. nniendntcnis to such
instruments applying only to olhcr propert�� in thc Rcdwood 13usincss Park sha�ll rcyuirc thc
consent of Costco to the ertent such amcndments ma�� al�lect thc Site or acccss to thc Sitr.
5. In thc evrnt oC any express con(lict bctwecn this Vlcmorandum and thc
/�grcement, tlu pro��isions ofthe A�rcement sh�tll conU�ol.
(. I�his Memoraudum may be cxecutcd in counterparts, each of whicli shall be
dcemed to be an original and all of �a�hich. toecthcr. sheill cons[itute but onc and the s.imc
Memorandum.
7. I'he provisions o1 this Memorandum automaitically shall terminatc and no lun��er
be ol am� Corec or effect follo�cin�, issuance of a certilicatc of oecupanc� for Costco's
improcentents to be consu�ucfid on thc Sitc. �I�hc p�rUes agree to rccord a cop� of Ihe certi�icate
ol occupancy, yuitclaim of this Memorandum or othcr documcnt rcasot�ably r�qucstcd by Costco
to c��idencc such tcrmination.
IN WI�I�NGSS WIIIiRI?OI�, ihc parlics hacc c�ecutcd this vlcmorandum us ol thc �iate
lirst ��bo��c written.
CI"I�Y OP UKInI f.
a municipal corporatio❑
13v-
F.xccuti��c Dircctor
I
I3y: �
Secrctar��
Counscl tbr Grantor '
�
Ariachmcnt Vo. 8
cs�c xass i;ao�_i x �
i?i�n_ni? 3 �
— — --- — �I
I he provisions of this Memorandum �u c hereby approved and accepted.
COSTCO WHOLNSAI,F. CORNOKAT[ON,
a Washington corporatiou
I�v:
Title:
I
I
I
II
Attachme��t No. 8
11SN'80J5 U304J 8 �
12/32011 4 i
-
�
I
� ACKNOWI,F.DG VIP,NTS �
I
I
Attachment i�o. 8 I
Uti W%035'�5 ifW J R
i?ianois Acknowlcdgcments
il
I
PXHII�IT A
LEUAL DHSCIZIP"IION OP THG SITIi
LANDS OF CITY OF UKIAH, SUCCESSOR AGENCY FOR DISSOLVED UKIAH
REDEVELOPMENT AGENCY, A PUBLIC BODY �
LOT 1
REAL PROPERTY SITUATE IN THE CITY OF UKIAH, COUNTY OF MENDOCINO. STATE OF
CALIFURNIA, DESCRIBED AS FOLLOWS
BEING ALL OF LOTS G1, G2, G3, FS & F10 AND A PORTION OF LOT F11 AS SAID LOTS ARE i
SHOWN ON THAT PARCEL MAP M.S 97-07 RECORDED JULY 28, 1997 IN MAP CASE 2, DRAWER
64 AT PAGES 21 & 22, OFFICIAL R�CORDS OF MENDOCINO COUNTY, TOGETHER WITH A
PORTION OF PARCEL 1 AS SHOWN ON THAT PARCEL MAP M S. 0451 RECORDED OCTOBER 2,
2006 IN MAPS, DRAWER 74 AT PAGES 4 THROUGH 6, OFFICIAL RECORDS OF MENDOCINO �
COUNTY, MORE PARTICULARLY DESCRIBED AS FOLLOWS:
BEGINNING AT THE NORTHWEST CORNER OF SAID LOT F8, ALSO BEING A POINT ON THE
EASTERLY RIGHT OF WAY FOR AIRPORT PARK BOULEVARD AS SHOWN ON SAID PARCEL MAP
M.S. 97-07; i
THENCE ALONG THE NORTHERLY I.INE OF SAID LOTS FS & G3, NORTH 84°40'22" EAST A i
DISTANCE OF 58528 FEET TO A POINT ON THE WESTERLY RIGHT OF WAY FOR U.S HIGHWAY �
101, SAID POINT ALSO BEING THE VORTHEAST CORNER OF LOT G3, AS SHID HIGHWAY AND '
LOT ARE SHOWN ON SAID PARCEL MAP M.S 97-07,
THENCE ALONG THE EASTERLY LINES OF SAID LOTS G3, G2. G1 AND SAID PARCEL 1, ALSO
BEING THE WESTERLY RIGHT OF WAY OF SAID HIGHWAY, THE FOLLOWING FIVE (5) COURSES:
1� THENCE SOUTH 02°29'45" EAST A DISTANCE OF 327 57 FEET,
2) THENCE SOUTH 05`21'28" EAST A DISTANCE OF 100 13 FEET;
3) THENCE SOUTH 02`29'45" EAST A DISTANCE OF 400 04 FEET,
4) THENCE SOUTH 00`38'06"WEST A DISTANCE OF 100.19 FEET;
5) THENCE SOUTH 02`29'15" EAST A DISTANCE OF 530.19 FEET;
THENC= LEA�IING SAID EASTERLY LINES AND SAID WESTERLY RIGHT OF WAY, SOUTH
84°40'2?_"WEST A DISTANCE OF 103 48 FEET;
THENCE NORTH 31"37'13" WESTA DISTANCE OF 249.94 FEET, I
THENCE SOUTH 84°40'22"WEST A DISTANCE OF 38.33 FEET,
THENCE NORTH 32°45'47"WEST A DISTANCE OF 33126 FEET;
THENCE SOUTH 84°40'22" WEST A DISTANCE OF 102.89 FEET TO A POINT ON THE WESTERLY
LINE OF SAID LOT F11, SAID POINT ALSO BEING ON THE EASTERLY RIGHT OF WAY OF SAID
AIRPORT PARK BOULEVARD�, �
THENCE ALONG THE WESTERLY LINES OF SAID LOTS F11, F10 & F8, ALSO BEING SAID I
EASTERLY RIGHT OF WAY, NORTH 05`36'44" WEST A DISTANCE OF 937 97 FEET TO THE POINT '
OF BEGINNING. CONTAINING 152989 ACRES OF LAND, MORE OR LESS
USW 3025153CJ-18 �
izii�zui�a Attachmenl No. 8 I