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HomeMy WebLinkAboutR-2000-075 Loan Agreement with Cascade Quality Molding, Inc.4110 RESOLUTION NO. R-2000- 7 J • A RESOLUTION authorizing the City Manager to execute a loan'agreement with Cascade Quality Molding, Inc., to lend it not more than $44,000 for which funding has been awarded by the Yakima County Supporting Investments in Economic Development (SIED) fund. WHEREAS, on March 21, 2000, the City Council authorized submittal of an application to Yakima County on behalf of the Cascade Quality Molding Project (the "Project") for financial assistance combining a grant and a loan from Supporting Investments in Economic Development ("SIED") funds to offset the costs of developing Project -related infrastructure including road, curb, gutter, sidewalks located at South 26th Avenue and Ahtanum Road; and WHEREAS, on April 6, 2000, the SIED advisory board voted to recommend to the Yakima County Commissioners an offer to the City of Yakima of $88,000 of SIED financial assistance in the form of 50% grant and 50% loan for the Project; and WHEREAS, Cascade Quality Molding, Inc., has offered, according to the terms of the attached loan agreement, to pay the City all amounts the City would become obligated to pay under the loan component of the prospective SIED financial assistance; and WHEREAS, the Yakima County Commissioners are expected to adopt the SIED advisory board's recommendation on June 6,. 2000; and WHEREAS, the City Council deems it to be in the best interest of the City that the City accept the prospective SIED financial assistance, and now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The City Manager is hereby authorized and directed, after verifying that Yakima County is committed to awarding the financial assistance described above, to execute an agreement substantially in the form of the attached loan agreement with Cascade Quality Molding, Inc. to lend it not more than $44,000 and to enter into such other agreements or to take such other actions as may be necessary and prudent to accept and use the financial assistance offered by Yakima County from the Supporting Investments in Economic Development (SIED) fund for the Cascade Quality Molding Project. ADOPTED BY THE CITY COUNCIL this t.1411, day of June 2000. Mary Place, Mayor ATTEST: Karen Roberts, City Clerk (ja) Resolution Cascade Quality Molding loan agreement, 05/31/00,2:12 PM TERM LOAN AGREEMENT PARTIES: BORROWER: Cascade Quality Molding, Inc., a Washington corporation; LENDER: City of Yakima, a Washington municipal corporation. TERM LOAN AGREEMENT dated as of , 2000, between Borrower and the Lender. The parties hereto hereby agree as follows: BACKGROUND. The Borrower is the owner of certain real property within the city limits of the City of Yakima upon which Borrower wishes to develop a commercial building and necessary infrastructure, which property is shown on the site plan attached hereto as Exhibit "A." The City will build or cause to be built, certain roads, curbs, gutters, sidewalks, sewer and water mains on the real property legally described in Exhibit "A" attached hereto and shown on the site plan attached hereto as Exhibit "D.") The Borrower will pay the City for all its costs and expenses incurred in having said improvements constructed upon the property. The City will lend to the Borrower under this agreement, funds up to Forty-four Thousand Dollars ($44,000.00), to the extent such funds are made available to the City from Yakima County under the County's Supporting Investments in Economic Development Program. Term Loan Agreement 1 Article I DEFINITIONS AND ACCOUNTING TERMS Section 1.01. Defined Terms. As used in this Agreement, the following terms have the following meanings (terms defined in the singular to have the same meaning when used in the plural and vice versa): "Agreement" means this Term Loan Agreement, as amended, supplemented, or modified from time to time. "Ahtanum Road Project" means that certain commercial improvement project designated by the City of Yakima as the "Ahtanum Road Project, No. ." "Business Day" means any day other than a Saturday, Sunday, or other day on which commercial banks in Washington are authorized or required to close under the laws of the State of Washington. "Collateral" means all property that is subject to the Lien granted by the Mortgages. "Commitment" means the Lender's obligation to make Loans to the Borrower pursuant to Section 2.01 in the amount referred to therein. "County SIED Agreement" means the loan agreement between the City of Yakima, as borrower, and Yakima County, as lender, under its Supporting Investments in Economic Development ("SIED") Program, as evidenced by that written commitment to lend and grant funds to the City dated 2000, and all documents subsequently executed in conjunction therewith. "Debt" means indebtedness or liability for borrowed money hereunder. "Default" means any of the events specified in Section 7.01, whether or not any requirement from time to time, and the regulations and published interpretations thereof. "Event of Default" means any of the events specified in Section 7.01, provided that any requirement for the giving of notice, the lapse of time, or both, or any other condition, has been satisfied. Term Loan Agreement 2 "GAAP" means generally accepted accounting principles in the United States. "Lien" means any mortgage, deed of trust, pledge, security interest, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), or preference, priority, or other security agreement or preferential arrangement, charge, or encumbrance of any kind or nature whatsoever. "Loan" shall have the meaning assignedto such term in Section 2.01. "Loan Document" means this Agreement, the Note, the Guaranty and the Mortgages. "Mortgage" means the Mortgage in substantially the form of Exhibit "C", to be delivered by the Borrower under the terms of this Agreement. "Note" shall have the meaning assigned to such term in Section 2.03, and shall be in substantially the form as attached hereto as Exhibit "B". "Person" means an individual, partnership, corporation, business trust, joint stock company, trust, unincorporated association, joint venture, governmental authority, or other entity of whatever nature. "Principal Office" means the Lender's office at 129 North 2nd Street, Yakima, Washington. Section 1.02. Accounting Terms. All accounting terms not specifically defined herein shall be construed in accordance with generally accepted accounting principles consistent with those applied in the preparation of the financial statements referred to in Section 4.04, and all financial data submitted pursuant to this Agreement shall be prepared in accordance with such principles. Article II AMOUNT AND TERMS OF THE LOAN Section 2.01. Term Loan. The Lender agrees on the terms and conditions hereinafter set forth, to make a loan (the "Loan") to the Borrower on the date of this Agreement in the principal amount of not more than Forty-four Thousand and no/100 Dollars ($44,000.00). Term Loan Agreement 3 Section 2.02. Interest. The Borrower shall pay the interest to the Lender on the outstanding and unpaid principal amount rate charged undunderththis SIED ement at a rate per annum equal to th Agreement. Any change in the interest shall become effectiveom a �as of the opening ange in the rate charged under the County SIED Agreement interest of business on the day oinInterest shall be calculated in a mannchange in the County SEED r Agreementcnsistent with rate shall become effective. the terms of the County SIED Agreement. Any principal amount not paid when due (at maturity, by acceleration, or otherwise) shall bear interest thereafter until paid in full, payable on demand, at the publicly announced prime rate of interest by Bank of America as of the day immediately after the payment due date. Section 2.03. Term Note. The Borrower's obligation to repay the Loan shall be evidenced by its promissory note (the "Note") in substantially the form of Exhibit "B" attached hereto with blanks appropriately filled in and payable to the order of the Lender. The Note shall be dated the date of this Agreement and the principal of the Loan shall be repaid in ten (10) equal, consecutive annual installments, with the first installment due on May 1, 2001, with subsequent installments on the first day of each May thereafter to and including May 1, 2010, provided, however, that the last such installment shall be in the amount necessary to repay in full the unpaid principal amount of the Loan. Section 2.04. Prepayments. The Borrower may prepay the Note in whole or in part with accrued interest to the date of such prepayment on the amount prepaid, provided that each partial prepayment shallbbe �®� p� amount °�m°t less ents of the an the next due annual payment and shall applied Note in the inverse order of their maturities. Section 2.05. Method of Payment. The Borrower shall make each payment under this Agreement and under the Note on the date when due in lawful money of the United States to the Lender at its Principal thisAgreementorunder th Office immediately Note shall be available Whenever any payment to be made under stated to be due on a day other than a shallBusiness Day, such payment uch case be be made on the next succeeding Business Day, and such extension of time shall in included in the computation of payment of interest. ..., �_ ,.r�i.,, Loan hereunder shall be Section 2.06. Use of Proceeds. The proceeds of the Loan used by the Borrower to construct road, curb, sidewalks, water and sewer mains and Term Loan Agreement 4 utility improvements as provided for under the approved plans and specifications of the Ahtanum Road Project. The Borrower will not, directly or indirectly, use any part of such proceeds for any purpose not consistent with said project. Article III CONDITIONS PRECEDENT Section 3.01. Condition Precedent to the Loan. The obligation of the Lender to make the Loan to Borrower is subject to the conditions precedent that the Lender shall have received on or before the day of such Loan each of the following, in form and substance satisfactory to the Lender and its counsel: (1) Note. The Note duly executed by the Borrower; (2) Mortgages. A Mortgage duly executed by the Borrower. (3) Evidence of authorization for all action by the Borrower. Copies of all authorizations by the members of the Borrower authorizing the action taken by the Borrower, induding resolutions of its members, authorizing the execution, delivery, and performance of the Loan Documents to which it is a party and each other document to be delivered pursuant to this Agreement; (4) Incumbency and signature certificate of the Borrower. A certificate (dated as of the date of this Agreement) of the President of Borrower certifying the names and true signatures of all members of the Borrower and of all officers authorized to sign the Loan Documents to which it is a party and each other documents to be delivered by the Borrower under this Agreement; (6) Transfer of title to Real Property. The Borrower will transfer all rights, title or interests required by the Lender necessary to allow the City of Yakima to construct or cause to construct the infrastructure improvements set forth on the Site Plan attached hereto as Exhibit "D" and as otherwise reasonably required to transfer title to the City for dedication of roadways. (7) Personal Guaranty. A personal guaranty and Mortgage duly executed by the President of the Borrower, and spouse, in such form as is acceptable to Lender. Term Loan Agreement 5 (8) Proof of Senior Debt Amount. Proof satisfactory to Lender that all senior debt secured by the real property described in Exhibit "A" and debt incurred under this Agreement is less than the appraised value of said real property. (9) Additional documentation. The Lender shall have received such other approvals, opinions, or documents as the Lender may reasonably request. Article IV REPRESENTATIONS AND WARRANTIES The Borrower represents and warrants to the Lender that: Section 4.01. Formation, Good Standing, and Due Qualification. The Borrower is a limited liability company duly formed, validly existing, and in good standing under the laws of the State of Washington; has the power and authority to own its assets and to transact the business in which it is now engaged or proposed to be engaged in. Section 4.02. Power and Authority. The execution, delivery, and performance by the Borrower of the Loan Documents have been duly authorized by all necessary company action. Section 4.03. Legally Enforceable Agreement. This Agreement is, and •77 legal, .l each of the other Loan Documents when delivered under this Agreement will be, legal, valid, and binding obligations of the Borrower and be enforceable against the Borrower in accordance with their respective terms, except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, and other similar laws affecting creditors' rights generally. Section 4.04. Litigation. There is no pending or threatened action or proceeding against or affecting the Borrower before any court, governmental agency, or arbitrator, which may, in any one case or in the aggregate, materially adversely affect the financial condition, operations, properties, or business of the Borrower or the ability of the Borrower to perform its obligation under the Loan Documents to which it is a party. Section 4.05. Ownership and Liens. The Borrower has title to all assets assigned or pledged to Lender as security for repayment of the Note. Term Loan Agreement 6 Section 4.06. Environment. The Borrower and the Guarantor have duly complied with, and their businesses, operations, assets, equipment, property, leaseholds, or other facilities are in compliance with, the provisions of all federal, state, and local environmental, health, and safety laws, codes and ordinances, and all rules and regulations promulgated thereunder. Neither the Borrower nor the Guarantor has received notice of, nor knows of, or suspects, facts which might constitute any violations of any federal, state, or local environmental, health, or safety laws, codes or ordinances, and any rules or regulations promulgated thereunder with respect to its businesses, operations, assets, equipment, property, leaseholds, or other facilities. Neither the Borrower nor the Guarantor have any indebtedness, obligation, or liability, absolute or contingent, matured or not matured, with respect to the storage, treatment, cleanup, or disposal of any solid wastes, hazardous wastes, or other toxic or hazardous substances (including without limitation any such indebtedness, obligation, or liability with respect to any current regulation, law, or statute regarding such storage, treatment, cleanup, or disposal) which is not disclosed herein: Article V AFFIRMATIVE COVENANTS So long as the Note shall remain unpaid, the Borrower will: Section 5.01. Maintenance of Existence. Preserve and maintain its company existence and good standing in the jurisdiction of its formation. Section 5.02. Maintenance of Records. Keep adequate records and books of account reflecting all financial transactions of the Borrower. Section 5.03. Maintenance of Properties. Maintain, keep, and preserve all of its properties (tangible and intangible) necessary or useful in the proper conduct of its business in good working order and condition, ordinary wear and tear excepted. Section 5.04. Conduct of Business. Continue to engage in an efficient and economical manner in a business of the same general type as now conducted by it on the date of this Agreement. Term Loan Agreement 7 Section 5.05. Compliance With Laws. Comply in all respects with all applicable laws, rules, regulations, and orders, such compliance to include, without limitation, paying before the same become delinquent all taxes, assessments, and governmental charges imposed upon it or upon its property. Section 5.06. Environment. Be and remain in compliance with the provisions of all federal, state, and local environmental, health, and safety laws, codes and ordinances, and all rules and regulations issued thereunder; notify the Lender immediately of any notice of a hazardous discharge or environmental complaint received from any governmental agency or any other party; notify the Lender immediately of any hazardous discharge from or affecting its premises; immediately contain and remove the same, in compliance with all applicable laws; promptly pay any fine or penalty assessed in connection therewith; permit the Lender to inspect the premises, to conduct tests thereon, and to inspect all books, correspondence, and records pertaining thereto; and at the Lender's request, and at the Borrower's expense, provide a report of a qualified environmental engineer, satisfactory in scope, form, and content to the Lender, and such other and further assurances reasonably satisfactory to the Lender that the condition has been corrected. Article VI NEGATIVE COVENANTS So long as the Note shall remain unpaid, the Borrower will not: Section 6.01. Liens. Create, incur, assume, or suffer to exist any Lien upon or with respect to any of its assets assigned or pledged to Lender to secure payment under the Note and performance of all obligations under this Agreement, now or hereafter acquired. Article VII EVENTS OF DEFAULT Section 7.01. Events of Default. If any of the following events shall occur: Note, The Borrower should fail to pay the principal of, or interest on, the Note, or any fee, as and when due and payable; Term Loan Agreement 8 (2) Any representation or warranty made or deemed made by the Borrower in this Agreement, the Guaranty, or the Mortgages shall prove to have been incorrect, incomplete, or misleading in any material respect on or as of the date made or deemed made; (3) The Borrower shall fail to perform or observe any term, covenant, or agreement contained in Articles V, VI, or VII hereof; (4) The Borrower or the Guarantor (a) shall generally not pay, or shall be unable to pay, or shall admit in writing its inability to pay its debts as such debts become due; or (b) shall make an assignment for the benefit of creditors, or petition or apply to any tribunal for the appointment of a custodian, receiver, or trustee for it or a substantial part of its assets; or (c) shall commence any proceeding under bankruptcy, reorganization, arrangement, readjustment of debt, dissolution, or liquidation law or statute of any jurisdiction, whether now or hereafter in effect; or (d) shall have had any such petition or application filed or any such proceeding commenced against it in which an order for relief is entered or an adjudication or appointment is made, and which remains undismissed for a period of one hundred and eighty (180) days or more; or (e) shall take any corporate action indicating its consent to, approval of,- or acquiescence in any such petition, application, proceeding, or order for relief or the appointment of a custodian, receiver, or trustee for all or any substantial part of its properties; or (f) shall suffer any such custodianship, receivership, or trusteeship to continue undischarged for a period of one hundred and eighty (180) days or more; (5) The Guaranty or the Mortgages shall at any time after its execution and delivery and for any reason cease (a) to create a valid and perfected first priority security interest in and to the property purported to be subject to such Mortgages; or (b) to be in full force and effect or shall be declared null and void, or the validity or enforceability thereof shall be contested by the Borrower, or the Borrower shall deny it has any further liability.or obligation under the Guaranty or the Mortgages, or the Borrower shall fail to perform any of its obligations under the Guaranty or the Mortgages; or (6) The Lender otherwise deems itself insecure. Section 7.02. Remedies Upon Default. Upon the occurrence of any event of default, the Lender may, by notice to the Borrower, declare the Note, all interest thereon, and all other amounts payable under this Agreement to be forthwith due and payable, whereupon the Note, all such Term Loan Agreement 9 interest, and all such amounts shall become and be forthwith due and payable, without presentment, demand, protest, or further notice of any kind, all of which are hereby expressly waived by the Borrower. Upon the occurrence and during the continuance of any Event of Default, the Lender is hereby authorized at any time and from time to time, without notice to the Borrower (any such notice being expressly waived by the Borrower), to deliver notice to the person obligated under the certificate of deposit to deliver all funds represented by said certificate of deposit to Lender and then to immediately set off and apply any and all such funds against any and all of the obligations of the Borrower now or hereafter existing under this Agreement or the Note or any other Loan Document, irrespective of whether or not the Lender shall have made any demand under this Agreement or the Note or such other Loan Document and although such obligations may be unmatured. The Lender agrees promptly to notify the Borrower after any such setoff and application, provided that the failure to give such notice shall not affect the validity of such setoff and application. The rights of the Lender under this Section 7.01 are in addition to other rights and remedies (induding, without limitation, other rights of setoff) which the Lender may have. Article VIII MISCELLANEOUS Section 8.01. Amendments, Etc. No amendment, modification, termination, or waiver of any provision of any Loan Document to which the Borrower is a party, nor consent to any departure by the Borrower from any Loan Document to which it is a party, shall in any event be effective unless the same shall be in writing and signed by the Lender, and then such waiver or consent shall be effective only in specific instance and for the specific purpose for which given. Section 8.02. Notices, Etc. All notices and other communications provided for under this Agreement and under the other Loan Documents to which the Borrower is a party shall be in writing (including telegraphic, telex, and facsimile transmissions) and mailed or transmitted or delivered, if to the Borrower, at its address at: Cascade Quality Molding, Inc. Yakima, Washington Attn. Term Loan Agreement 10 and if to the Lender, at its address at: 129 North Second Street Yakima, Washington 98901 Attention: William R. Cook; or, as to each party, at such other address as shall be designated by such party in a written notice to the other party complying as to delivery with the terms of this Section 8.02. Except as otherwise provided in this Agreement, all such notices and communications shall be effective when deposited in the mails or delivered to the telegraph company, or sent, answer back received, respectively, addressed as aforesaid, except that notices to the Lender pursuant to the provisions of Artide II shall not be effective until received by the Lender. Section 8.03. No Waiver. No failure or delay on the part of the Lender in exercising any right, power, or remedy hereunder shall operate as a waiver thereof; not shall any single or partial exercise of any such right, power, or remedy predude any other or further exercise thereof or the exercise of any other right, power, or remedy hereunder. The rights and remedies provided herein are cumulative, and are not exclusive of any other rights, powers, privileges, or remedies, now or hereafter existing, at law or in equity or otherwise. Section 8.04. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Borrower and the Lender and their respective successors and assigns, except that the Borrower may not assign or transfer any of its rights under any Loan Document to which the Borrower is a party without the prior written consent of the Lender. Section 8.05. Integration. This Agreement and the Loan Documents contain the entire agreement between the parties relating to the subject matter hereof and supersede all oral statement and prior writings with respect thereto. Section 8.06. Indemnity. The Borrower hereby agrees to defend, indemnify, and hold the Lender harmless from and against any and all claims, damages, judgments, penalties, costs, and expenses (including attorney fees and court costs now or hereafter arising from the aforesaid enforcement of this clause) arising directly or indirectly from the activities of the Borrower, its predecessors in interest, or third parties with whom it has a contractual relationship, or arising directly or indirectly Term Loan Agreement 11 from the violation of any environmental protection, health, or safety law, whether such daims are asserted by any governmental agency or any other person. This indemnity shall survive termination of this Agreement. Section 8.07. Governing Law. This Agreement and the Note shall be governed by, and construed in accordance with, the laws of the State of Washington. Section 8.08. Severability of Provisions. Any provision of any Loan Document which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of such Loan Document or affecting the validity or enforceability of such provision in any other jurisdiction. Section 8.09. Headings. Artide and Section headings in the Loan Documents are included in such Loan Documents for the convenience of reference only and shall not constitute a part of the applicable Loan Documents for any other purpose. Section 8.11. Attorney Fees. In the event legal action is instituted to determine the rights and duties of the parties hereunder in any state or federal court, including bankruptcy court, the prevailing party in any court action shall be awarded, its reasonable attorney's fees, costs and expenses in pursuing such action in any state or federal court and enforcing such rights and duties determined thereby. Section 8.11. Jury Trial Waiver. THE LENDER AND THE BORROWER HEREBY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM, OR TiTllT TT1l�ST COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, A T LAW OR 1N EQ u i i 1, ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT OR THE LOAN DOCUMENTS. NO OFFICER OF THE LENDER HAS AUTHORITY TO WAIVE, CONDITION, OR MODIFY THIS PROVISION. DISCLOSURE ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW. Term Loan Agreement 12 IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written. ATTEST: City of Yakima 129 North Second Street Yakima, WA 98901 Karen Roberts, City Clerk City CASCADE QUALITY MOLDING, INC. By Title y CITY OF YAKIMA By: R. A. Zais, Jr., City Manager City Contract No. 2000-55 Resolution N o . R-2000-75 F:\CLIENTS\DAB\YAKIMA\SIED Program\Cascade Quality\Term Loan Agt.FIN.doc Term Loan Agreement 13 EXHIBIT "A" TO TERM LOAN AGREEMENT Legal Description of Real Property: Parcel A of Short Plat, as recorded in Book "D" of Plats, Page 47 records of Yakima County, Washington, AND the East 10 feet of Lot 4 of Short Plat 85-122, as recorded under Auditor's File Number 2737570, Yakima County, Washington, EXCEPT that portion conveyed to Yakima County by deed recorded February 24, 1997, under Auditor's File Number 7000021. DAB\YAKIMA\SIED Program\Cascade Quality\Exh A to Loan Agt. Oegal).doc EXHIBIT "B" TO TERM LOAN AGREEMENT TERM NOTE $ 44.000.00 , 2000 Yakima, Washington FOR VALUE RECEIVED, the undersigned, CASCADE QUALITY MOLDING, INC., a Washington corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of THE CITY OF YAKIMA, (the "Lender"), at its Principal Office located at 129 North 2nd Street, Yakima, Washington, the principal amount of FORTY-FOUR THOUSAND and NO/100 DOLLARS ($44,000.00) in lawful money of the United States and in immediately available funds in ten (10) equal, consecutive annual installments, with the first installment due on May 1, 2001, with subsequent installments on the first day of each May thereafter to and including May 1, 2010, provided, however, that the last such installment shall be in the amount necessary to repay in full the unpaid principal amount of this Term Note, and to pay interest on the unpaid principal amount of this Term Note from the date of this Term Note until such principal amount has been fully repaid at a rate per annum equal to the rate set at Yakima County, Washington's "interfund transfer" rate. Any amount of principal hereof which is not paid when due, whether at stated maturity, by acceleration, or otherwise, shall bear interest from the date when due until said principal amount is paid in full, at the publicly announced prime rate of interest by Bank of America as of the day immediately after the payment due date. If any installment of this Term Note becomes due and payable on a day other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day, and interest shall be payable thereon at the rate herein specified during such extension. This Term Note is the Note referred to in, and is entitled to the benefits of, the Term Loan Agreement of even date, between the Borrower and the Lender (the "Credit Agreement"). Terms used herein which are defined in the Credit Agreement Term Promissory Note 1 shall have their defined meanings when used herein. The Credit Agreement, among other things, contains provisions for acceleration of the maturity of this Term Note upon the happening of certain stated events and also for prepayments on account of principal hereof prior to the maturity of this Term Note upon the terms and conditions specified in the Credit Agreement. This Term Note is secured by a Security Agreement referred to in the Credit Agreement, reference to which is hereby made for a description of the collateral provided for under the Security Agreement and the rights of the Borrower and the Lender with respect to such collateral. This Term Note shall be governed by the laws of the State of Washington, provided that, as to the maximum rate of interest which may be charged or collected, if the laws applicable to the Lender permit it to charge or collect a higher rate than the laws of the State of Washington, then such law applicable to the Lender shall apply to the Lender under this Term Note. Venue for any action shall be in Yakima County. Attorney Fees: In the event of any collection activity, or if legal action is instituted to determine the rights and duties of the parties hereunder in any state or federal court, including bankruptcy court, the acting party shall be paid by the other party, or the prevailing party in any court action shall be awarded, its reasonable attorney's fees, costs and expenses in pursuing collection or in bringing such action in any state or federal court and enforcing such rights and duties determined thereby. CASCADE QUALITY MOLDING, INC. By: Title : F:\CLIENTS\DAB\YAKIMA\SIED Program\Cascade Quality\Exh B to Loan Agt..doc Term Promissory Note 2 EXHIBIT "C" TO TERM LOAN AGREEMENT FILED FOR RECORD AT REQUEST OF: Donald A. Boyd Halverson & Applegate, P.S. P. O. Box 22730 Yakima, WA 98907-2715 MORTGAGE Grantor(s): 1. KRAFT, LARRY L. 2. KRAFT, TERESA M. Grantee(s): 1. THE CITY OF YAKIMA Legal Description: 1. SP Parcel "A", Book "D", Page 47 and East 10' Lot 4 SP 85-122; (Full legal description at page 2) Assessor's Property Tax Parcel Number(s): 181203-14401 1 MORTGAGE: Mortgagors, Larry L. Kraft and Teresa M. Kraft, husband and wife, hereby mortgage to Mortgagee, The City of Yakima, to secure the payment and performance of the secured obligation as described below, the following described real property situate in the County of Yakima, State of Washington, to -wit: Parcel A of Short Plat, as recorded in Book "D" of Plats, Page 47 records of Yakima County, Washington, AND the East 10 feet of Lot 4 of Short Plat 85-122, as recorded under Auditor's File Number 2737570, Yakima County, Washington, EXCEPT that portion conveyed to Yakima County by deed recorded February 24, 1997, under Auditor's File Number 7000021. SECURED OBLIGATION: This Mortgage is given to secure the payment and performance of all obligations now or hereafter owing by Mortgagor to Mortgagee, including interest thereon, any extensions or renewals thereof, and expenses incurred by Mortgagee in connection therewith. Without limiting the generality of the foregoing, it is specifically understood that this Mortgage is given to secure the repayment of all obligations made by Mortgagee to Mortgagee, including interest thereon, including, without limitation, the terms of the obligation as evidenced by the "Term Loan Agreement" and "Promissory Note" made this day of , 2000. GENERAL TERMS OF MORTGAGE: 1. Mortgagor covenants that she is lawfully seized of the property in fee simple and has good right to mortgage and convey it. 2. This Mortgage not only covers the real property described above, but also all improvements and appurtenances thereto, including all water, water rights, shares of water stock or water memberships, irrigation equipment and supplies, and matters appertaining thereto. 3. Mortgagor agrees to pay before delinquency all taxes, special assessments, and other public charges levied, assessed or charged against the mortgaged premises and, further, agrees to keep all fixtures, equipment, and improvements on the said premises insured against loss to the extent of the full insurable value thereof. Mortgagor agrees to make Mortgagee a loss payee on all such policies of insurance. 2 4. Should Mortgagor default in any of the foregoing agreements or covenants, then Mortgagee may perform the same and may pay any part or all of the principal and interest of any charges against the property, and any amount so paid, with interest thereon at the highest legal rate from date of payment, shall be repayable by Mortgagor on demand, and shall also be secured by this Mortgage without waiver of any right or other remedy arising from the breach of the agreements or covenants. 5. In the event of the transfer of all or any part of Mortgagor's interest in the mortgaged property, whether voluntarily or involuntarily, or by operation of law, Mortgagee may, at its option, treat such transfers a default by Mortgagor and may resort to the remedies as provided for in this Mortgage or as provided for by law. 6. If the interest of Mortgagor in the property secured by this Mortgage is either a purchaser's or seller's interest in a Real Estate Contract for the sale of real property, then Mortgagor hereby specifically acknowledges and agrees that upon default, Mortgagor's interest in the property may be foreclosed by Mortgagee, at its sole option as (a) a Mortgagee under the provisions of RCW Chapter 61.12, et seq.; or (b) under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. 7. Mortgagor agrees that this Mortgage shall also be construed as a security agreement under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. At Mortgagee's request, Mortgagor agrees to execute and deliver such financing statements as Mortgagee may require to perfect its security interest under the said Uniform Commercial Code. 8. In the event of default by Mortgagor with respect to any of the obligations secured hereby, Mortgagee shall have, in addition to all other remedies and rights at law or in equity, the following rights and remedies: (a) to declare any and all indebtedness secured by this Mortgage to be immediately due and payable; (b) to apply for, with or without notice to Mortgagor upon filing, a suit to enforce or preserve its rights under this Mortgage; (c) to cause the foreclosure of this Mortgage as a Mortgage under the real property or personal property laws of this state; and (d) all other rights and remedies as provided for in this Mortgage. 9. All rights and remedies of Mortgagee provided for in this Mortgage are intended to be cumulative and not in substitution for any other right or remedy otherwise available to Mortgagee. 3 10. Mortgagor agrees to pay to Mortgagee any and all costs and expenses, including attorney's fees, incurred or paid by Mortgagee in protecting or enforcing its rights under the terms of this Mortgage, whether or not a lawsuit is commenced. "Attorney's fees" shall include services rendered before trial, at trial, and on appeal, as well as services rendered subsequent to judgment and obtaining execution thereof. The award of such fees, costs, and expenses shall bear interest at the highest lawful rate until paid in full. DATED this day of , 2000. STATE OF WASHINGTON ) ss: County of Yakima Larry L. Kraft Teresa M. Kraft I certify that I know or have satisfactory evidence that LARRY L. KRAFT and TERES • TO AFT personally appeare(� before me and signed this TERESA ►7[i M. iuuz�• �, Ycaovas.-..� ..Y2..,..._--- --__-- instrument and acknowledged it to be their free and voluntary act for the uses and purposes mentioned in the instrument. DATED: , 2000. NOTARY PUBLIC in and for the State of Washington Residing at: My Commission Expires: \DAB\YAKIMA\SIED Program\Cascade Quality\Exn C to Loan Agt. (Mortgage).doc 4 TERM NOTE $ 44,000.00 2000 Yakima, Washington FOR VALUE RECEIVED, the undersigned, CASCADE QUALITY MOLDING, INC., a Washington corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of THE CITY OF YAKIMA, (the "Lender"), at its Principal Office located at 129 North 2nd Street, Yakima, Washington, the principal amount of FORTY-FOUR THOUSAND and NO/100 DOLLARS ($44,000.00) in lawful money of the United States and in immediately available funds in ten (10) equal, consecutive annual installments, with the first installment due on May 1, 2001, with subsequent installments on the first day of each May thereafter to and including May 1, 2010, provided, however, that the last such installment shall be in the amount necessary to repay in full the unpaid principal amount of this Term Note, and to pay interest on the unpaid principal amount of this Term Note from the date of this Term Note until such principal amount has been fully repaid at a rate per annum equal to the rate set at Yakima County, Washington's "interfund transfer" rate. Any amount of principal hereof which is not paid when due, whether at stated maturity, by acceleration, or otherwise, shall bear interest from the date when due until said principal amount is paid in full, at the publicly announced prime rate of interest by Bank of America as of the day immediately after the payment due date. If any installment of this Term Note becomes due and payable on a day other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day, and interest shall be payable thereon at the rate herein specified during such extension. This Term Note is the Note referred to in, and is entitled to the benefits of, the Term Loan Agreement of even date, between the Borrower and the Lender (the "Credit Agreement"). Terms used herein which are defined in the Credit Agreement shall have their defined meanings when used herein. The Credit Agreement, among other things, contains provisions for acceleration of the maturity of this Term Promissory Note 1 Term Note upon the happening of certain stated events and also for prepayments on account of principal hereof prior to the maturity of this Tenn Note upon the terms and conditions specified in the Credit Agreement. This Term Note is secured by a Security Agreement referred to in the Credit Agreement, reference to which is hereby made for a description of the collateral provided for under the Security Agreement and the rights of the Borrower and the Lender with respect to such collateral. This Term Note shall be governed by the laws of the State of Washington, provided that, as to the maximum rate of interest which may be charged or collected, if the laws applicable to the Lender permit it to charge or collect a higher rate than the laws of the State of Washington, then such law applicable to the Lender shall apply to the Lender under this Term Note. Venue for any action shall be in Yakima County. Attorney Fees: In the event of any collection activity, or if legal action is instituted to determine the rights and duties of the parties hereunder in any state or federal court, including bankruptcy court, the acting party shall be paid by the other party, or the prevailing party in any court action shall be awarded, its reasonable attorney's fees, costs and expenses in pursuing collection or in bringing such action in any state or federal court and enforcing such rights and duties determined thereby. CASCADE QUALITY MOLDING, INC. F:\CLIENTS\DAB\YAKIMA\SLED Program\Cascade Quality\Term Note.doc Term Promissory Note 2 FILED FOR RECORD AT REQUEST OF: Donald A. Boyd Halverson & Applegate, P.S. P. O. Box 22730 Yakima, WA 98907-2715 MORTGAGE Grantor(s): 1. KRAFT, LARRY L. 2. KRAFT, TERESA M. Grantee(s): 1. THE CITY OF YAKIMA Legal Description: 1. SP Parcel "A", Book "D", Page 47 and East 10' Lot 4 SP 85-122; (Full legal description at page 2) Assessor's Property Tax Parcel Number(s): 181203-14401 MORTGAGE: Mortgagors, Larry L. Kraft and Teresa M. Kraft, husband and wife, hereby mortgage to Mortgagee, The City of Yakima, to secure the payment and performance of the secured obligation as described below, the following described real property situate in the County of Yakima, State of Washington, to -wit: Parcel A of Short Plat, as recorded in Book "D" of Plats, Page 47 records of Yakima County, Washington, AND the East 10 feet of Lot 4 of Short Plat 85-122, as recorded under Auditor's File Number 2737570, Yakima County, Washington, EXCEPT that portion conveyed to Yakima County by deed recorded February 24, 1997, under Auditor's File Number 7000021. SECURED OBLIGATION: This Mortgage is given to secure the payment and performance of all obligations now or hereafter owing by Mortgagor to Mortgagee, induding interest thereon, any extensions or renewals thereof, and expenses incurred by Mortgagee in connection therewith. Without limiting the generality of the foregoing, it is specifically understood that this Mortgage is given to secure the repayment of all obligations made by Mortgagee to Mortgagee, induding interest thereon, including, without limitation, the terms of the obligation as evidenced by the "Term Loan Agreement" and "Promissory Note" made this day of , 2000. GENERAL TERMS OF MORTGAGE: 1. Mortgagor covenants that she is lawfully seized of the property in fee simple and has good right to mortgage and convey it. 2. This Mortgage not only covers the real property described above, but also all improvements and appurtenances thereto, including all water, water rights, shares of water stock or water memberships, irrigation equipment and supplies, and matters appertaining thereto. 3. Mortgagor agrees to pay before delinquency all taxes, special assessments, and other public charges levied, assessed or charged against the mortgaged premises and, further, agrees to keep all fixtures, equipment, and improvements on the said premises insured against loss to the extent of the full insurable value thereof. Mortgagor agrees to make Mortgagee a loss payee on all such policies of insurance. 2 4. Should Mortgagor default in any of the foregoing agreements or covenants, then Mortgagee may perform the same and may pay any part or all of the principal and interest of any charges against the property, and any amount so paid, with interest thereon at the highest legal rate from date of payment, shall be repayable by Mortgagor on demand, and shall also be secured by this Mortgage without waiver of any right or other remedy arising from the breach of the agreements or covenants. 5. In the event of the transfer of all or any part of Mortgagor's interest in the mortgaged property, whether voluntarily or involuntarily, or by operation of law, Mortgagee may, at its option, treat such transfers a default by Mortgagor and may resort to the remedies as provided for in this Mortgage or as provided for by law. 6. If the interest of Mortgagor in the property secured by this Mortgage is either a purchaser's or seller's interest in a Real Estate Contract for the sale of real property, then Mortgagor hereby specifically acknowledges and agrees that upon default, Mortgagor's interest in the property may be foreclosed by Mortgagee, at its sole option as (a) a Mortgagee under the provisions of RCW Chapter 61.12, et seq.; or (b) under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. 7. Mortgagor agrees that this Mortgage shall also be construed as a security agreement under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. At Mortgagee's request, Mortgagor agrees to execute and deliver such financing statements as Mortgagee may require to perfect its security interest under the said Uniform Commercial Code. 8. In the event of default by Mortgagor with respect to any of the obligations secured hereby, Mortgagee shall have, in addition to all other remedies and rights at law or in equity, the following rights and remedies: (a) to declare any and all indebtedness secured by this Mortgage to be immediately due and payable; (b) to apply for, with or without notice to Mortgagor upon filing, a suit to enforce or preserve its rights under this Mortgage; (c) to cause the foreclosure of this Mortgage as a Mortgage under the real property or personal property laws of this state; and (d) all other rights and remedies as provided for in this Mortgage. 9. All rights and remedies of Mortgagee provided for in this Mortgage are intended to be cumulative and not in substitution for any other right or remedy otherwise available to Mortgagee. 3 10. Mortgagor agrees to pay to Mortgagee any and all costs and expenses, including attorney's fees, incurred or paid by Mortgagee in protecting or enforcing its rights under the terms of this Mortgage, whether or not a lawsuit is commenced. "Attorney's fees" shall include services rendered before trial, at trial, and on appeal, as well as services rendered subsequent to judgment and obtaining execution thereof. The award of such fees, costs, and expenses shall bear interest at the highest lawful rate until paid in full. DATED this (i �f: day of _ vim, , 2000. STATE OF WASHINGTON ) ss. County of Yakima Teresa M. Kraft I certify that 1 know or have satisfactory evidence that LARRY L. KRAFT and TERESA M. KRAFT, personally appeared before me and signed this instrument and acknowledged it to be their free and voluntary act for the uses and purposes mentioned in the instrument. NOTARY PUBLIC in and or the State of Washin on Residing at: / daof Od My Commissi Expires: /-zo/zact F:\CLIENTS\DAB\YAKLALA\SIED Program\Cascade Quality\Mortgage - Kraft Residence.doc 4 UNCONDITIONAL GUARANTY As an inducement and in consideration of any and all contemporaneous or future financial accommodations by The City of Yakima, a Washington municipal corporation, including, but not limited to the Department of Community and Economic Development (herein called "Lender") to Cascade Quality Molding, Inc. (herein called "Borrower"), the undersigned (herein called "Guarantor"), hereby unconditionally guarantees the prompt payment and performance when due and at all times thereafter of any and all existing, contemporaneously incurred and future indebtedness, duties, obligations and liabilities of every kind (including all extensions, renewals and modifications thereof), absolute or contingent, however created or evidenced, owing from Borrower to Lender plus such interest, fees, costs and expenses as may accrue thereon. Credit may be granted by Lender to Borrower from time to time without further authorization of or notice to Guarantor. Guarantor agrees to pay Lender all expenses of every kind including, without limitation, any and all fees and expenses incurred by it on account of the services of any attorney employed or retained by it, including house counsel, in protecting or defending Lender's interest and in attempting to collect all or any part of such indebtedness and in enforcing this guaranty, with or without suit. Every immediate and successive assignee of any part of such indebtedness guaranteed hereby shall have the right to enforce all agreements and obligations contained in this guaranty for its own benefit as fully as if named herein, but Lender shall nevertheless have the right to enforce this guaranty for its own benefit as to so much of the liability guaranteed as has not been assigned. Guarantor waives notice of (a) the acceptance of this guaranty; (b) any and all indebtedness of any kind covered by the guaranty; and (c) any and all demands, nonpayments or other defaults in respect of such indebtedness. If more than one person or legal entity signs this Unconditional Guaranty, all references to "Guarantor" herein shall bind each of the undersigned jointly and severally. The liability of Guarantor under this guaranty shall be continuing and shall remain in full force and effect as long as Borrower is or may be indebted to Lender on account of any indebtedness covered by the guaranty, unless and until Guarantor delivers to Lender written notice that this guaranty has been revoked and terminated as to subsequent loans, which notice is actually received by Lender before any such subsequent loan has been committed. It shall not be affected in any way by (and the Lender is hereby expressly authorized to make without notice to anyone) any sale, pledge, surrender, compromise, release, acceleration, discharge, renewal, extension, substitution, exchange or modification of any kind whatsoever of all or any part of the indebtedness covered by the guaranty, or of all or any part of the security or collateral given to secure such indebtedness, including the release or addition of other guarantors. In addition, such liability of Guarantor shall not be affected in any way by the failure or invalidity of or any defect in any security or collateral given to secure such indebtedness. This Guaranty is secured by a mortgage against residential real property owned by the Guarantors. Unconditional Guaranty Page -1- No exercise or non -exercise, waiver, change, impairment or suspension by Lender of any right or remedy given it by this Unconditional Guaranty or by Borrower and no dealings by Lender with Borrower or any other person shall in any way affect any of the obligations of Guarantor hereunder or any security furnished by Guarantor, now or hereafter, or give Guarantor any recourse against Lender. The obligations of Guarantor to Lender hereunder are independent of Borrower's obligations and a separate action or actions may be brought and prosecuted by Lender against Guarantor, whether or not such action or actions are also brought against Borrower, other guarantors or any security granted to Lender. Guarantor waives and agrees not to assert or otherwise take advantage of (a) any right which it may have to require Lender to proceed against Borrower or any other person, firm or corporation or to proceed against or exhaust any security held by it at any time or to pursue any other remedy in its power; (b) any defense which it may have in the nature of statute of limitations in any action hereunder or for the collection of any indebtedness or the performance of any obligation guaranteed hereby; (c) any defense which it may have by reason of incapacity, lack of authority, or lack of shareholder or other approvals relating either to Borrower or Guarantor or the failure of Lender to file or enforce a claim against the estate (either in administration, bankruptcy, or other proceeding) of Borrower or of any other or others; (d) any lack of demand, protest and notice of any kind including, without limitation, notice of the existence, creation or incurring of new or additional indebtedness or of any action or non -action on the part of Borrower, Lender, any endorser, creditor of Borrower or Guarantor under this or any other agreement, or any person whomsoever, in connection with any obligation or evidence of indebtedness held by Lender as collateral or in connection with any indebtedness guaranteed hereby; (e) any defense which is may have based upon an election of remedies by Lender; and (f) any duty which Lender may have to disclose to Guarantor any facts which it may now or hereafter know about Borrower, it being understood and agreed that Guarantor is fully responsible for being and keeping informed of the financial condition of Borrower and of all circumstances bearing on the risk of non-payment of any indebtedness guaranteed hereby. Until•■ _l �_d_bt_d_ess Borrower Lender f ll Guarantor shall have no right of URLll Fill 111UCUl.CLL11GJe of to is paid in ____, subrogation and waives any right which it may otherwise have to enforce any remedy whatsoever which Lender may have against Borrower and any benefit of or right to participate in realization or any security now or hereafter granted to Lender. With or without notice to Guarantor, Lender may, in its sole discretion and at any time and from time to time either before or after delivery of any notice of revocation hereunder and in such manner and upon such terms as it considers fit, apply any or all payments or recoveries from Borrower, Guarantor, any other guarantor or source, or from any security granted to Lender, under this or any other agreement, in such manner and order or priority as Lender may determine, to any indebtedness of Borrower to Lender, whether or not such indebtedness is guaranteed hereby or is otherwise secured or is due at the time of such application. For consideration as recited above, Guarantor subordinates any and all indebtedness of Borrower to Guarantor to any and all indebtedness of Borrower to Lender. If Lender so requests, any such indebtedness of Borrower to Guarantor shall be collected and received by paid id to Lender account Borrower's indebtedness to Guarantor as trustee for Lender and lldlu ,..CiiuCi on of Borrower's �-----___ Unconditional Guaranty Page -2- it, without reducing or affecting Guarantor's liability under any of the provisions of this guaranty. This guaranty is in addition to and independent of any other guaranties at any time in effect with respect to all or any part of Borrower's indebtedness to Lender and may be enforced regardless of the existence of any such other guaranties which shall continue to remain in full force and effect. No provision of this guaranty or any right or remedy of Lender hereunder can be waived nor can Guarantor be released from its obligations hereunder except in writing duly executed by an authorized officer of Lender. Should any one or more provisions of this guaranty be determined to be illegal or unenforceable, all other provisions shall nevertheless be effective. This guaranty shall be construed and performed according to the laws of the State of Washington. Guarantor irrevocably submits to the jurisdiction of any state or federal court sitting in Yakima, Yakima County, Washington, in any action or proceeding brought to enforce or otherwise arising out of or relating to this guaranty and irrevocably waives to the fullest extent permitted by law any objection which it may have now or hereafter to the lain of venue or any claim that such forum is an inconvenient forum. EXECUTED this te C- day of , 2000. GUARANTOR: F•\CLIENTS \DAB\Y_AKNIA\SIED Program\Cascade Quality\Guaranty.doc Unconditional Guaranty Page -3- FILED FOR RECORD AT REQUEST OF: Donald A. Boyd Halverson & Applegate, P.S. P. O. Box 22730 Yakima, WA 98907-2715 MORTGAGE Grantor(s): 1. KRAFT, LARRY L. 2. KRAFT, TERESA M. Grantee(s): 1. THE CITY OF YAKIMA Legal Description: 1. Lot 6, Armstrong Addition, Vol. "J", Page 50 and North 10' of SW 1/4 SE 1/4 of NW 1/4 of N/w 1/4 of NE 1/4 S26,T13N, R18 EWM. Assessor's Property Tax Parcel Number(s): 181326-12471 1 MORTGAGE: Mortgagor, Larry L. Kraft and Teresa M. Kraft, husband and wife, hereby mortgages to Mortgagee, The City of Yakima, to secure the payment and performance of the secured obligation as described below, the following described real property situate in the County of Yakima, State of Washington, to -wit: Lot 6, ARMSTRONG ADDITION, as recorded in Volume "J" of Plats, Page 50, records of Yakima County, Washington, AND the North 10 feet of the Southwest 1/4 of the Southeast 1/4 of the Northwest 1/4 of the Northwest 1/4 of the Northeast 1/4 of Section 26,Township 13 North, Range 18 E.W.M.; EXCEPT the West 25 feet thereof. SECURED OBLIGATION: This Mortgage is given to secure the payment and performance of all obligations now or hereafter owing by Mortgagor to Mortgagee, including interest thereon, any extensions or renewals thereof, and expenses incurred by Mortgagee in connection therewith. Without limiting the generality of the foregoing, it is specifically understood that this Mortgage is given to secure the repayment of all obligations made by Mortgagee to Mortgagee, including interest thereon, including, without limitation, the terms of the obligation as evidenced by the "Guaranty" made this day of , 2000. GENERAL TERMS OF MORTGAGE: 1. Mortgagor covenants that she is lawfully seized of the property in fee simple and has good right to mortgage and convey it. 2. This Mortgage not only covers the real property described above, but also all improvements and appurtenances thereto, including all water, water rights, shares of water stock or water memberships, irrigation equipment and supplies, and matters appertaining thereto. 3, Mortgagor agrees to pay before delinquency all taxes, special assessments, and other public charges levied, assessed or charged against the mortgaged premises and, further, agrees to keep all fixtures, equipment, and improvements on the said premises insured against loss to the extent of the full insurable value thereof. Mortgagor agrees to make Mortgagee a loss payee on all such policies of insurance. 2 4. Should Mortgagor default in any of the foregoing agreements or covenants, then Mortgagee may perform the same and may pay any part or all of the principal and interest of any charges against the property, and any amount so paid, with interest thereon at the highest legal rate from date of payment, shall be repayable by Mortgagor on demand, and shall also be secured by this Mortgage without waiver of any right or other remedy arising from the breach of the agreements or covenants. 5. In the event of the transfer of all or any part of Mortgagor's interest in the mortgaged property, whether voluntarily or involuntarily, or by operation of law, Mortgagee may, at its option, treat such transfers a default by Mortgagor and may resort to the remedies as provided for in this Mortgage or as provided for by law. 6. If the interest of Mortgagor in the property secured by this Mortgage is either a purchaser's or seller's interest in a Real Estate Contract for the sale of real property, then Mortgagor hereby specifically acknowledges and agrees that upon default, Mortgagor's interest in the property may be foreclosed by Mortgagee, at its sole option as (a) a Mortgagee under the provisions of RCW Chapter 61.12, et seq.; or (b) under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. 7. Mortgagor agrees that this Mortgage shall also be construed as a security agreement under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. At Mortgagee's request, Mortgagor agrees to execute and deliver such financing statements as Mortgagee may require to perfect its security interest under the said Uniform Commercial Code. 8. In the event of default by Mortgagor with respect to any of the obligations secured hereby, Mortgagee shall have, in addition to all other remedies and rights at law or in equity, the following rights and remedies: (a) to declare any and all indebtedness secured by this Mortgage to be immediately due and payable; (b) to apply for, with or without notice to Mortgagor upon filing, a suit to enforce or preserve its rights under this Mortgage; (c) to cause the foreclosure of this Mortgage as a Mortgage under the real property or personal property laws of this state; and (d) all other rights and remedies as provided for in this Mortgage. 9. All rights and remedies of Mortgagee provided for in this Mortgage are intended to be cumulative and not in substitution for any other right or remedy otherwise available to Mortgagee. 3 10. Mortgagor agrees to pay to Mortgagee any and all costs and expenses, including attorney's fees, incurred or paid by Mortgagee in protecting or enforcing its rights under the terms of this Mortgage, whether or not a lawsuit is commenced. "Attorney's fees" shall include services rendered before trial, at trial, and on appeal, as well as services rendered subsequent to judgment and obtaining execution thereof. The award of such fees, costs, and expenses shall bear interest at the highest lawful rate until paid in full. DATED this day of , 2000. STATE OF WASHINGTON ) ss. County of Yakima Larry L. Kraft Teresa M. Kraft I certify that I know or have satisfactory evidence that LARRY L. KRAFT and TERESA M. KRAFT, personally appeared before me and signed this instrument and acknowledged it to be their free and voluntary act for the uses and purposes mentioned in the instrument. DATED: , 2000. NOTARY PUBLIC in and for the State of Washington Residing at: My Commission Expires: F \CLIENTS\DAB\YAKIMA\SIED Program\Cascade Quality\Mortgage - Kraft Residence.doc 4 BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. b A - For Meeting of:iune 6, 2000 ITEM TITLE: Consideration of a resolution authorizing the City Manager to execute a loan agreement with Cascade Quality Molding in an amount not to exceed $44,000 for which funding has been awarded by the Yakima County Supporting Investments in Economic Development (SIED) program. SUBMITTED BY: V `William Cook, Director of Community and Economic Development CONTACT PERSON/TELEPHONE: William Cook 575-6227 SUMMARY EXPLANATION: On March 21, 2000, the City Council approved a resolution authorizing submission of a grant and loan application to the Yakima County SIED fund for the Cascade Quality Molding Project. The SIED board voted to approve the application for $88,000 on April 6, 2000. SIED funds will be awarded to the City in the form of a 50% loan to be repaid by the developer and a 50% grant. SIED funding will pay for widening of Ahtanum Road to four lanes, and the construction of curb and gutter fronting property located at South 26`h Avenue and Ahtanum road. The improvements are required for the construction of a new manufacturing facility for Cascade Quality Molding, Inc., which will expand its existing operations when the facility is completed. The estimated cost for infrastructure improvements related to the Cascade expansion is $88,000. In addition, the City will leverage the private investment of road improvements funded by Cascade Quality Molding together with available federal transportation grant funds to complete the widening, to four lanes, of Ahtanum Road from 16`h avenue west to the City limits. The total cost of all improvements related to the project is estimated at $496,500.00. Cascade Quality Molding specializes in custom injection molding and plastic parts from design through production. Cascade serves original equipment manufactures, as well as the electronics, aerospace and agricultural industries. Cascade also supports many customers and produces a variety of custom parts and products for the medical, electronics, communications and semi- conductor industries. Resolution X Ordinance Contract:" Other Specify: Loan Agreement Funding Source: Yakima County SIED Fund APPROVAL FOR SUBMITTAL: City Manager STAFF RECOMMENDATION: Staff recommends approval of the resolution. BOARD/COMMISSION RECOMMENDATION: COUNCIL ACTION: LAW OFFICES OF CAm.ON Box) PLLC 230 S. 2"° STREET, Surre 202 YA:aMA, WASHINGTON 98901 TELEPHONE: 509-8346611 -FACSIbmE: 509-8346610 son Boyd PLLC Attorneys; at Law November 8, 2013 Mr. Roger Bailey 411 North 2nd Street Yakima, Washington 98901 Re: Cascade Quality Molding, Inc. Dear Roger: Via AMS DONALD A. BOYD dboyd@cbblawfirm.com RECEIVED t; 2013 CITY LEGAL DEPT. I enclose with this letter the following original documents reflecting the full payment of the Term Loan from the City of Yakima to Cascade Quality Molding, Inc.: 1. Release of Mortgage (Parcel 181203-14401); 2. Release of Mortgage (Parcel 181326-12471); 3. Term Note dated July 6, 2000; 4. Note Modification Agreement dated August 6, 2001; 5. Term Loan Agreement dated July 6, 2000; 6. Mortgage (Parcel 181203-14401); 7. Mortgage (Parcel 181326-12471); and, 8. Unconditional Guaranty of Larry and Teresa Kraft dated July 6, 2000. Very Truly Yours, Donald A. Boyd Encl. cc. Jeff Cutter;w/.b ene1.,; x:\city of yakima-20009\cascade quality molding-2003006\correspondence\bailey 110813 (ltr w mtg releases - original loan docs).docx Dukart, Robin From: Cutter, Jeff Sent: Thursday, October 31, 2013 12:58 PM To: Epperson, Cindy; Dukart, Robin Subject: Kraft -Custom Quality Molding Cindy and Robin, as follow-up to recent communication concerning the status of Mr. Kraft's SIED loan obligation, I understand that the loan obligation to the City has been fulfilled. I have and am seeking the CM's signature on two releases of mortgage documents for the two properties the City held to r1 secure the SIED loan. I also believe there was a Term Loan Agreement, one or more Promissory / d' Notes and a Personal Guarantee that Mr. Kraft provided the City as security that should be returned to Mr. Kraft. To accomplish that would you please review the Kraft file and copy these last mentioned documents for the file, mark as closed and returned, and then advise me when I can pick up the originals so that they can be returned? I appreciate your help. Please let me know if you have any questions. Thanks. JC Privileged & Confidential: Covered by the Attorney -Client & Attorney Work Product Privileges Jeffrey R. Cutter City Attorney City of Yakima Legal Department 200 South Third Street Yakima, WA 98901-2830 (509) 575-6030 Fax: (509) 575-6160 r C igt6 1 NOTE MODIFICATION AGREEMENT This Agreement is made and executed this & day of 2001, by and between CASCADE QUALITY MOLDING, INC., a Washingto corporation ("Maker") and modifies and amends that certain note dated July 6, 2000, in the principal sum of $44,000.00, executed by Maker and delivered to THE CITY OF YAKIMA, as Lender (the note together with any previous modifications, amendments, or extensions is referred to herein as the "Note"). 1. The Note is hereby modified as follows (note applicable changes): a. Payments due on the note shall be paid as follows: The first installment payment is due and payable on June 1, 2002, and subsequent installment payments shall be due June 1 of each year thereafter until paid in full. Installment payments are due in the amounts set forth on the payment schedule attached hereto as Exhibit 1, and incorporated herein by this reference. b. The interest rate under the Note shall be 4.20 percent per annum, or such other rate as may hereafter by charged to the Lender under that certain contract between Yakima County and the City of Yakima and known as SIED Contract No. YC -CM -00. 2. Except as modified herein, the terms and conditions of the Note and any other agreements shall continue in full force and effect, including without limitation the provisions for default specified therein. The Maker and Guarantors agree to be and are bound jointly and severally by the terms of the Note, as modified herein. Maker: CASCADE QUALITY MOLDING, INC. By: Its: Note Modification Agreement Page -1- Guarantors: ...;16ezekL clZar Teresa M. Kr The City of Yakima By: ATTEST: City of Yakima 129 North Second Street, �r Yakima, WA 98901 y� SEAL ®Ko- I rte% Karen Roberts, City Clerk R. A. Zais, Jr., City Manager CRY CONTRACT NO. a00/ -7.S; F.\CT.TENTS \DAB\YAKIMA\SIED Program\Cascade Quality\Term Note Modification Agt. (2001).doc Note Modification Agreement Page -2- 131P. 1101 FILED FOR RECORD AT REQUEST OF: Donald A. Boyd Halverson & Applegate, P.S. P. O. Box 22730 Yakima, WA 98907-2715 MORTGAGE Grantor(s): 1. KRAFT, LARRY L. 2. KRAFT, TERESA M. Grantee(s): 1. THE CITY OF YAKIMA Legal Description: 1. SP Parcel "A", Book "D", Page 47 and East 10' Lot 4 SP 85-122; (Full legal description at page 2) Assessor's Property Tax Parcel Number(s): 181203-14401 1 CITY OF YAK MR 1 11 11 111111 11 7196901 Page: 1 of 4 12120/2000 09:41A MTG $11.00 Yakima Co, WR MORTGAGE: Mortgagors, Larry L. Kraft and Teresa M. Kraft, husband and wife, hereby mortgage to Mortgagee, The City of Yakima, to secure the payment and performance of the secured obligation as described below, the following described real property situate in the County of Yakima, State of Washington, to -wit: Parcel A of Short Plat, as recorded in Book "D" of Plats, Page 47 records of Yakima County, Washington, AND the East 10 feet of Lot 4 of Short Plat 85-122, as recorded under Auditor's File Number 2737570, Yakima County, Washington, EXCEPT that portion conveyed to Yakima County by deed recorded February 24, 1997, under Auditor's File Number 7000021. SECURED OBLIGATION: This Mortgage is given to secure the payment and performance of all obligations now or hereafter owing by Mortgagor to Mortgagee, including interest thereon, any extensions or renewals thereof, and expenses incurred by Mortgagee in connection therewith. Without limiting the generality of the foregoing, it is specifically understood that this Mortgage is given to secure the repayment of all obligations made by Mortgagee to Mortgagee, including interest thereon, including, without limitation, the terms of the obligation as evidenced by the "Term Loan Agreement" and "Promissory Note" made this G' " day of Shy , 2000. GENERAL TERMS OF MORTGAGE: 1. Mortgagor covenants that she is lawfully seized of the property in fee simple and has good right to mortgage and convey it. 2. This Mortgage not only covers the real property described above, but also all improvements and appurtenances thereto, including all water, water rights, shares of water stock or water memberships, irrigation equipment and supplies, and matters appertaining thereto. 3. Mortgagor agrees to pay before delinquency all taxes, special assessments, and other public charges levied, assessed or charged against the mortgaged premises and, further, agrees to keep all fixtures, equipment, and improvements on the said premises insured against loss to the extent of the full insurable value thereof. Mortgagor agrees to make Mortgagee a loss payee on all such policies of insurance. 11 11 11 TY OF YAK MI 1 1 1 111 1 7196901 Page: 2 of 4 12/20/2000 09:41A MT $11.00 Yakima Co, WA 4. Should Mortgagor default in any of the foregoing agreements or covenants, then Mortgagee may perform the same and may pay any part or all of the principal and interest of any charges against the property, and any amount so paid, with interest thereon at the highest legal rate from date of payment, shall be repayable by Mortgagor on demand, and shall also be secured by this Mortgage without waiver of any right or other remedy arising from the breach of the agreements or covenants. 5. In the event of the transfer of all or any part of Mortgagor's interest in the mortgaged property, whether voluntarily or involuntarily, or by operation of law, Mortgagee may, at its option, treat such transfers a default by Mortgagor and may resort to the remedies as provided for in this Mortgage or as provided for by law. 6. If the interest of Mortgagor in the property secured by this Mortgage is either a purchaser's or seller's interest in a Real Estate Contract for the sale of real property, then Mortgagor hereby specifically acknowledges and agrees that upon default, Mortgagor's interest in the property may be foreclosed by Mortgagee, at its sole option as (a) a Mortgagee under the provisions of RCW Chapter 61.12, et seq.; or (b) under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. 7. Mortgagor agrees that this Mortgage shall also be construed as a security agreement under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. At Mortgagee's request, Mortgagor agrees to execute and deliver such financing statements as Mortgagee may require to perfect its security interest under the said Uniform Commercial Code. 8. In the event of default by Mortgagor with respect to any of the obligations secured hereby, Mortgagee shall have, in addition to all other remedies and rights at law or in equity, the following rights and remedies: (a) to declare any and all indebtedness secured by this Mortgage to be immediately due and payable; (b) to apply for, with or without notice to Mortgagor upon filing, a suit to enforce or preserve its rights under this Mortgage; (c) to cause the foreclosure of this Mortgage as a Mortgage under the real property or personal property laws of this state; and (d) all other rights and remedies as provided for in this Mortgage. 9. All rights and remedies of Mortgagee provided for in this Mortgage are intended to be cumulative and not in substitution for any other right or remedy otherwise available to Mortgagee. 11 11 11 1 ITY OF YAK M N 1111 1 11 11 MTG II II 7196901 Page: 3 of 4 12/2012000 09:41A $ AA Yakima Co, WA 10. Mortgagor agrees to pay to Mortgagee any and all costs and expenses, including attorney's fees, incurred or paid by Mortgagee in protecting or enforcing its rights under the terms of this Mortgage, whether or not a lawsuit is commenced. "Attorney's fees" shall include services rendered before trial, at trial, and on appeal, as well as services rendered subsequent to judgment and obtaining execution thereof. The award of such fees, costs, and expenses shall bear interest at the highest lawful rate until paid in full. DATED this 6 day of , 2000. STATE OF WASHINGTON ) ss. County of Yakima L. Kraft 'U ` P7 Teresa M. Kraft A-kt I certify that I know or have satisfactory evidence that LARRY L. KRAFT and TERESA M. KRAFT, personally appeared before me and signed this instrument and acknowledged it to be their free and voluntary act for the uses and purposes mentioned in the instrument. DATED: fidy G , 2000. OTARY PUBLIC or the a4, State of Washin on Residing at: �, Gl My Commissi n Expires: /zz%oo/ F:\CI.TFNTS\DAB\YAKIMA\SIED Program\Cascade Quality\Mortgage - Business Property.doc 1 CITY OF YAKIMA 111 1 II 1 11 11 7196901 Page: 4 of 4 12/20/2000 09:41A MT $ 1.00 Yakima Co, WA FILED FOR RECORD AT REQUEST OF: Donald A. Boyd Halverson & Applegate, P.S. P. O. Box 22730 Yakima, WA 98907-2715 MORTGAGE Grantor(s): 1. KRAFT, LARRY L. 2. KRAFT, TERESA M. Grantee(s): 1. THE CITY OF YAKIMA Legal Description: 1. Lot 6, Armstrong Addition, Vol. "J", Page 50 and North 10' of SW 1/4 SE 1/4 of NW 1/4 of N/w 1/4 of NE 1/4 S26,T13N, R18 EWM. Assessor's Property Tax Parcel Number(s): 181326-12471 111 11 f TV ar Vf]V MO 1 11 11 7196902 Page 1 of 12/20/2000 0941A d AA Yakima Co, WA MORTGAGE: Mortgagor, Larry L. Kraft and Teresa M. Kraft, husband and wife, hereby mortgages to Mortgagee, The City of Yakima, to secure the payment and performance of the secured obligation as described below, the following described real property situate in the County of Yakima, State of Washington, to -wit: Lot 6, ARMSTRONG ADDITION, as recorded in Volume "J" of Plats, Page 50, records of Yakima County, Washington, AND the North 10 feet of the Southwest 1/4 of the Southeast 1/4 of the Northwest 1/4 of the Northwest 1/4 of the Northeast 1/4 of Section 26,Township 13 North, Range 18 E.W.M.; EXCEPT the West 25 feet thereof. SECURED OBLIGATION: This Mortgage is given to secure the payment and performance of all obligations now or hereafter owing by Mortgagor to Mortgagee, including interest thereon, any extensions or renewals thereof, and expenses incurred by Mortgagee in connection therewith. Without limiting the generality of the foregoing, it is specifically understood that this Mortgage is given to secure the repayment of all obligations made by Mortgagee to Mortgagee, including interest thereon, including, without limitation, the terms of the obligation as evidenced by the "Guaranty" made this CO= day of ,- 2000. GENERAL TERMS OF MORTGAGE: 1. Mortgagor covenants that she is lawfully seized of the property in fee simple and has good right to mortgage and convey it. 2. This Mortgage not only covers the real property described above, but also all improvements and appurtenances thereto, including all water, water rights, shares of water stock or water memberships, irrigation equipment and supplies, and matters appertaining thereto. 3. Mortgagor agrees to pay before delinquency all taxes, special assessments, and other public charges levied, assessed or charged against the mortgaged premises and, further, agrees to keep all fixtures, equipment, and improvements on the said premises insured against loss to the extent of the full insurable value thereof. Mortgagor agrees to make Mortgagee a loss payee on all such policies of insurance. ks" TV nr VQV M 1 1 1 11 11 7196902 Page: 2 of 7 12/20/2000 09:41A t 4 AA Yakima Co, WA 4. Should Mortgagor default in any of the foregoing agreements or covenants, then Mortgagee may perform the same and may pay any part or all of the principal and interest of any charges against the property, and any amount so paid, with interest thereon at the highest legal rate from date of payment, shall be repayable by Mortgagor on demand, and shall also be secured by this Mortgage without waiver of any right or other remedy arising from the breach of the agreements or covenants. 5. In the event of the transfer of all or any part of Mortgagor's interest in the mortgaged property, whether voluntarily or involuntarily, or by operation of law, Mortgagee may, at its option, treat such transfers a default by Mortgagor and may resort to the remedies as provided for in this Mortgage or as provided for by law. 6. If the interest of Mortgagor in the property secured by this Mortgage is either a purchaser's or seller's interest in a Real Estate Contract for the sale of real property, then Mortgagor hereby specifically acknowledges and agrees that upon default, Mortgagor's interest in the property may be foreclosed by Mortgagee, at its sole option as (a) a Mortgagee under the provisions of RCW Chapter 61.12, et seq.; or (b) under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. 7. Mortgagor agrees that this Mortgage shall also be construed as a security agreement under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. At Mortgagee's request, Mortgagor agrees to execute and deliver such financing statements as Mortgagee may require to perfect its security interest under the said Uniform Commercial Code. 8. In the event of default by Mortgagor with respect to any of the obligations secured hereby, Mortgagee shall have, in addition to all other remedies and rights at law or in equity, the following rights and d remedies: (a) to declare any and all indebtedness secured by this Mortgage to be immediately due and payable; (b) to apply for, with or without notice to Mortgagor upon filing, a suit to enforce or preserve its rights under this Mortgage; (c) to cause the foreclosure of this Mortgage as a Mortgage under the real property or personal property laws of this state; and (d) all other rights and remedies as provided for in this Mortgage. 9. All rights and remedies of Mortgagee provided for in this Mortgage are intended to be cumulative and not in substitution for any other right or remedy otherwise available to Mortgagee. 11 11 11 1 TY OF YAK MI 1 1 1 11 11 II 1111 76902 Pa19ge 3 of 7 12/2012000 09,41A MTG $ 4.00 Yakima Co, WR 10. Mortgagor agrees to pay to Mortgagee any and all costs and expenses, including attorney's fees, incurred or paid by Mortgagee in protecting or enforcing its rights under the terms of this Mortgage, whether or not a lawsuit is commenced. "Attorney's fees" shall include services rendered before trial, at trial, and on appeal, as well as services rendered subsequent to judgment and obtaining execution thereof. The award of such fees, costs, and expenses shall bear interest at the highest lawful rate until paid in full. DATED this (0f4—day of "`� , 2000. STATE OF WASHINGTON ) ss. County of Yakima a� Teresa M. Kraft :-A1,442111*)1)0 I certify that I know or have satisfactory evidence that LARRY L. KRAFT and TERESA M. KRAFT, personally appeared before me and signed this instrument and acknowledged it to be their free and voluntary act for the uses and purposes mentioned in the instrument. NOTARY PUBLIC in and or the State of Washin on Residing at: .frdlra Hit My Commissi Expireszo/zao/ F:\CLIENTS\DAB\YAKIMA\SIED Program\Cascade Quality\Mortgage - Kraft Residence.doc 11 11 11 1 ITY OF YAKIMI 1 1 1 11 11 II 11 11 11 7196902 Page: 4 of 7,;711 4j t, s. 12/20/2000 09:41A MTG $ 4 00 Yakima Co, WA UNCONDITIONAL GUARANTY As an inducement and in consideration of any and all contemporaneous or future financial accommodations by The City of Yakima, a Washington municipal corporation, including, but not limited to the Department of Community and Economic Development (herein called "Lender") to Cascade Quality Molding, Inc. (herein called "Borrower"), the undersigned (herein called "Guarantor"), hereby unconditionally guarantees the prompt payment and performance when due and at all times thereafter of any and all existing, contemporaneously incurred and future indebtedness, duties, obligations and liabilities of every kind (including all extensions, renewals and modifications thereof), absolute or contingent, however created or evidenced, owing from Borrower to Lender plus such interest, fees, costs and expenses as may accrue thereon. Credit may be granted by Lender to Borrower from time to time without further authorization of or notice to Guarantor. Guarantor agrees to pay Lender all expenses of every kind including, without limitation, any and all fees and expenses incurred by it on account of the services of any attorney employed or retained by it, including house counsel, in protecting or defending Lender's interest and in attempting to collect all or any part of such indebtedness and in enforcing this guaranty, with or without suit. Every immediate and successive assignee of any part of such indebtedness guaranteed hereby shall have the right to enforce all agreements and obligations contained in this guaranty for its own benefit as fully as if named herein, but Lender shall nevertheless have the right to enforce this guaranty for its own benefit as to so much of the liability guaranteed as has not been assigned. Guarantor waives notice of (a) the acceptance of this guaranty; (b) any and all indebtedness of any kind covered by the guaranty; and (c) any and all demands, nonpayments or other defaults in respect of such indebtedness. If more than one person or legal entity signs this Unconditional Guaranty, all references to "Guarantor" herein shall bind each of the undersigned jointly and severally. The liability of Guarantor under this guaranty shall be continuing and shall remain in full force and effect as long as Borrower is or may be indebted to Lender on account of any indebtedness covered by the guaranty, unless and until Guarantor delivers to Lender written notice that this guaranty has been revoked and terminated as to subsequent loans, which notice is actually received by Lender before any such subsequent loan has been committed. It shall not be affected in any way by (and the Lender is hereby expressly authorized to make without notice to anyone) any sale, pledge, surrender, compromise, release, acceleration, discharge, renewal, extension, substitution, exchange or modification of any kind whatsoever of all or any part of the indebtedness covered by the guaranty, or of all or any part of the security or collateral given to secure such indebtedness, including the release or addition of other guarantors. In addition, such liability of Guarantor shall not be affected in any way by the failure or invalidity of or any defect in any security or collateral given to secure such indebtedness. This Guaranty is secured by a mortgage against residential real property owned by the Guarantors. Unconditional Guaranty Page -1- TY OF YAKIMI 11 11 11 1 1 1 1 11 11 11 A i ')''T:0313‘9. 196902 Page 5 0£ 7 '1'2120r�600 09 41A MTG $14.00 Yakima Co, WA No exercise or non -exercise, waiver, change, impairment or suspension by Lender of any right or remedy given it by this Unconditional Guaranty or by Borrower and no dealings by Lender with Borrower or any other person shall in any way affect any of the obligations of Guarantor hereunder or any security furnished by Guarantor, now or hereafter, or give Guarantor any recourse against Lender. The obligations of Guarantor to Lender hereunder are independent of Borrower's obligations and a separate action or actions may be brought and prosecuted by Lender against Guarantor, whether or not such action or actions are also brought against Borrower, other guarantors or any security granted to Lender. Guarantor waives and agrees not to assert or otherwise take advantage of (a) any right which it may have to require Lender to proceed against Borrower or any other person, firm or corporation or to proceed against or exhaust any security held by it at any time or to pursue any other remedy in its power; (b) any defense which it may have in the nature of statute of limitations in any action hereunder or for the collection of any indebtedness or the performance of any obligation guaranteed hereby; (c) any defense which it may have by reason of incapacity, lack of authority, or lack of shareholder or other approvals relating either to Borrower or Guarantor or the failure of Lender to file or enforce a claim against the estate (either in administration, bankruptcy, or other proceeding) of Borrower or of any other or others; (d) any lack of demand, protest and notice of any kind including, without limitation, notice of the existence, creation or incurring of new or additional indebtedness or of any action or non -action on the part of Borrower, Lender, any endorser, creditor of Borrower or Guarantor under this or any other agreement, or any person whomsoever, in connection with any obligation or evidence of indebtedness held by Lender as collateral or in connection with any indebtedness guaranteed hereby; (e) any defense which is may have based upon an election of remedies by Lender; and (f) any duty which Lender may have to disclose to Guarantor any facts which it may now or hereafter know about Borrower, it being understood and agreed that Guarantor is fully responsible for being and keeping informed of the financial condition of Borrower and of all circumstances bearing on the risk of non-payment of any indebtedness guaranteed hereby. Until all indebtedness of Borrower to Lender is paid in full, Guarantor shall have no right of subrogation and waives any right which it may otherwise have to enforce any remedy whatsoever which Lender may have against Borrower and any benefit of or right to participate in realization or any security now or hereafter granted to Lender. With or without notice to Guarantor, Lender may, in its sole discretion and at any time and from time to time either before or after delivery of any notice of revocation hereunder and in such manner and upon such terms as it considers fit, apply any or all payments or recoveries from Borrower, Guarantor, any other guarantor or source, or from any security granted to Lender, under this or any other agreement, in such manner and order or priority as Lender may determine, to any indebtedness of Borrower to Lender, whether or not such indebtedness is guaranteed hereby or is otherwise secured or is due at the time of such application. For consideration as recited above, Guarantor subordinates any and all indebtedness of Borrower to Guarantor to any and all indebtedness of Borrower to Lender. If Lender so requests, any such indebtedness of Borrower to Guarantor shall be collected and received by Guarantor as trustee for Lender and paid to Lender on account of Borrower's indebtedness to Unconditional Guaranty Page -2- TY OF YAK M 1 1 1 11 11 0 719690G2 Page: 90/62960030941A of 09 41A MTG $14.00 Yakima Co, WA N it, without reducing or affecting Guarantor's liability under any of the provisions of this guaranty. This guaranty is in addition to and independent of any other guaranties at any time in effect with respect to all or any part of Borrower's indebtedness to Lender and may be enforced regardless of the existence of any such other guaranties which shall continue to remain in full force and effect. No provision of this guaranty or any right or remedy of Lender hereunder can be waived nor can Guarantor be released from its obligations hereunder except in writing duly executed by an authorized officer of Lender. Should any one or more provisions of this guaranty be determined to be illegal or unenforceable, all other provisions shall nevertheless be effective. This guaranty shall be construed and performed according to the laws of the State of Washington. Guarantor irrevocably submits to the jurisdiction of any state or federal court sitting in Yakima, Yakima County, Washington, in any action or proceeding brought to enforce or otherwise arising out of or relating to this guaranty and irrevocably waives to the fullest extent permitted by law any objection which it may have now or hereafter to the lain of venue or any claim that such forum is an inconvenient forum. EXECUTED this � H day of 2000. GUARANTOR: 4./ Lar L Kraf/ 0y t % Teresa M. Kraft F.\CLIENTS\DAB\YAKIMA\SIED Program\Cascade Quality\Guaranty.doc Unconditional Guaranty Page -3- TY OF YAK MI 1 1 1 11 u 1111 II II II 7196902 Page: 7 of 7 12/20/2000 G9:41A MTG $14.00 Yakima Co, WA TERM LOAN AGREEMENT dated as of Washington corporation; iunicipal corporation. l ' 2000, between Borrower and the Lender. The parties hereto here agree s follows: BACKGROUND. The Borrower is the owner of certain real property within the city limits of the City of Yakima upon which Borrower wishes to develop a commercial building and necessary infrastructure, which property is shown on the site plan attached hereto as Exhibit "A." The City will build or cause to be built, certain roads, curbs, gutters, sidewalks, sewer and water mains on the real property legally described in Exhibit "A" attached hereto and shown on the site plan attached hereto as Exhibit "D.") The Borrower will pay the City for all its costs and expenses incurred in having said improvements constructed upon the property. The City will lend to the Borrower under this agreement, funds up to Forty-four Thousand Dollars ($44,000.00), to the extent such funds are made available to the City from Yakima County under the County's Supporting Investments in Economic Development Program. Term Loan Agreement 1 Article I DEFINITIONS AND ACCOUNTING TERMS Section 1.01. Defined Terms. As used in this Agreement, the following terms have the following meanings (terms defined in the singular to have the same meaning when used in the plural and vice versa): "Agreement" means this Term Loan Agreement, as amended, supplemented, or modified from time to time. "Ahtanum Road Project" means that certain commercial improvement project designated by the City of Yakima as the "Ahtanum Road Project, No. / ?CT ." "Business Day" means any day other than a Saturday, Sunday, or other day on which commercial banks -in Washington are authorized or required to close under the laws of the State of Washington. "Collateral" means all property that is subject to the Lien granted by the Mortgages. "Commitment" means the Lender's obligation to make Loans to the Borrower pursuant to Section 2.01 in the amount referred to therein. "County SIED Agreement" means the loan agreement between the City of Yakima, as borrower, and Yakima County, as lender, under its Supporting Investments in Economic Development ("SIED") Program, as a 'deuced by that written commitment to lend and grant funds to the City dated ' 2000, i:f,,_ and all documents subsequently executed in conjunction ther)hwith. "Debt" means indebtedness or liability for borrowed money hereunder. "Default" means any of the events specified in Section 7.01, whether or not any requirement from time to time, and the regulations and published interpretations thereof. "Event of Default" means any of the events specified in Section 7.01, provided that any requirement for the giving of notice, the lapse of time, or both, or any other condition, has been satisfied. Term Loan Agreement 2 • �5:� .'4.n.: diti�. . "GAAP" means generally accepted accounting principles in the United States. "Lien" means any mortgage, deed of trust, pledge, security interest, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), or preference, priority, or other security agreement or preferential arrangement, charge, or encumbrance of any kind or nature whatsoever. "Loan" shall have the meaning assigned to such term in Section 2.01. "Loan Document" means this Agreement, the Note, the Guaranty and the Mortgages. "Mortgage" means the Mortgage in substantially the form of Exhibit "C", to be delivered by the Borrower under the terms of this Agreement. "Note" shall have the meaning assigned to such term in Section 2.03, and shall be in substantially the form as attached hereto as Exhibit "B". "Person" means an individual, partnership, corporation, business trust, joint stock company, trust, unincorporated association, joint venture, governmental authority, or other entity of whatever nature. "Principal Office" means the Lender's office at 129 North 2nd Street, Yakima, Washington. Section 1.02. Accounting Terms. All accounting terms not specifically defined herein shall be construed in accordance with generally accepted accounting principles consistent with those applied in the preparation of the financial statements referred to in Section 4.04, and all financial data submitted pursuant to this Agreement shall be prepared in accordance with such principles. Article 1I AMOUNT AND TERMS OF THE LOAN Section 2.01. Term Loan. The Lender agrees on the terms and conditions hereinafter set forth, to make a loan (the "Loan") to the Borrower on the date of this Agreement in the principal amount of not more than Forty-four Thousand and no/100 Dollars ($44,000.00). Term Loan Agreement 3 Section 2.02. Interest. The Borrower shall pay the interest to the Lender on the outstanding and unpaid principal amount of the Loan made under this Agreement at a rate per annum equal to the interest rate charged under the County SIED Agreement. Any change in the interest rate resulting from a change in the rate charged under the County SIED Agreement shall become effective as of the opening of business on the day on which such change in the County SIED Agreement interest rate shall become effective. Interest shall be calculated in a manner consistent with the terms of the County SIED Agreement. Any principal amount not paid when due (at maturity, by acceleration, or otherwise) shall bear interest thereafter until paid in full, payable on demand, at the publicly announced prime rate of interest by Bank of America as of the day immediately after the payment due date. Section 2.03. Term Note. The Borrower's obligation to repay the Loan shall be evidenced by its promissory note (the "Note") in substantially the form of Exhibit "B" attached hereto with blanks appropriately filled in and payable to the order of the Lender. The Note shall be dated the date of this Agreement and the principal of the Loan shall be repaid in ten (10) equal, consecutive annual installments, with the first installment due on May 1, 2001, with subsequent installments on the first day of each May thereafter to and including May 1, 2010, provided, however, that the last such installment shall be in the amount necessary to repay in full the unpaid principal amount of the Loan. Section 2.04. Prepayments. The Borrower may prepay the Note in whole or in part with accrued interest to the date of such prepayment on the amount prepaid, provided that each partial prepayment shall be in a principal amount of not less than the next due annual payment and shall be applied to the principal installments of the Note in the inverse order of their maturities. Section 2.05. Method of Payment. The Borrower shall make each payment under this Agreement and under the Note on the date when due in lawful money of the United States to the Lender at its Principal Office in immediately available funds. Whenever any payment to be made under this Agreement or under the Note shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of payment of interest. Section 2.06. Use of Proceeds. The proceeds of the Loan hereunder shall be used by the Borrower to construct road, curb, sidewalks, water and sewer mains and Term Loan Agreement 4 utility improvements as provided for under the approved plans and specifications of the Ahtanum Road Project. The Borrower will not, directly or indirectly, use any part of such proceeds for any purpose not consistent with said project. Article III CONDITIONS PRECEDENT Section 3.01. Condition Precedent to the Loan. The obligation of the Lender to make the Loan to Borrower is subject to the conditions precedent that the Lender shall have received on or before the day of such Loan each of the following, in form and substance satisfactory to the Lender and its counsel: (1) Note. The Note duly executed by the Borrower; (2) Mortgages. A Mortgage duly executed by the Borrower. (3) Evidence of authorization for all action by the Borrower. Copies of all authorizations by the members of the Borrower authorizing the action taken by the Borrower, including resolutions of its members, authorizing the execution, delivery, and performance of the Loan Documents to which it is a party and each other document to be delivered pursuant to this Agreement; (4) Incumbency and signature certificate of the Borrower. A certificate (dated as of the date of this Agreement) of the President of Borrower certifying the names and true signatures of all members of the Borrower and of all officers authorized to sign the Loan Documents to which it is a party and each other documents to be delivered by the Borrower under this Agreement; (6) Transfer of title to Real Property. The Borrower will transfer all rights, title or interests required by the Lender necessary to allow the City of Yakima to construct or cause to construct the infrastructure improvements set forth on the Site Plan attached hereto as Exhibit "D" and as otherwise reasonably required to transfer title to the City for dedication of roadways. (7) Personal Guaranty. A personal guaranty and Mortgage duly executed by the President of the Borrower, and spouse, in such form as is acceptable to Lender. Term Loan Agreement 5 (8) Proof of Senior Debt Amount. Proof satisfactory to Lender that all senior debt secured by the real property described in Exhibit "A" and debt incurred under this Agreement is less than the appraised value of said real property. (9) Additional documentation. The Lender shall have received such other approvals, opinions, or documents as the Lender may reasonably request. Article IV REPRESENTATIONS AND WARRANTIES The Borrower represents and warrants to the Lender that: Section 4.01. Formation, Good Standing, and Due Qualification. The Borrower is a limited liability company duly formed, validly existing, and in good standing under the laws of the State of Washington; has the power and authority to own its assets and to transact the business in which it is now engaged or proposed to be engaged in. Section 4.02. Power and Authority. The execution, delivery, and performance by the Borrower of the Loan Documents have been duly authorized by all necessary company action. Section 4.03. Legally Enforceable Agreement. This Agreement is, and each of the other Loan Documents when delivered under this Agreement will be, legal, valid, and binding obligations of the Borrower and be enforceable against the Borrower in accordance with their respective terms, except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, and other similar laws affecting creditors' rights generally. Section 4.04. Litigation. There is no pending or threatened action or proceeding against or affecting the Borrower before any court, governmental agency, or arbitrator, which may, in any one case or in the aggregate, materially adversely affect the financial condition, operations, properties, or business of the Borrower or the ability of the Borrower to perform its obligation under the Loan Documents to which it is a party. Section 4.05. Ownership and Liens. The Borrower has title to all assets assigned or pledged to Lender as security for repayment of the Note. Term Loan Agreement 6 Section 4.06. Environment. The Borrower and the Guarantor have duly complied with, and their businesses, operations, assets, equipment, property, leaseholds, or other facilities are in compliance with, the provisions of all federal, state, and local environmental, health, and safety laws, codes and ordinances, and all rules and regulations promulgated thereunder. Neither the Borrower nor the Guarantor has received notice of, nor knows of, or suspects, facts which might constitute any violations of any federal, state, or local environmental, health, or safety laws, codes or ordinances, and any rules or regulations promulgated thereunder with respect to its businesses, operations, assets, equipment, property, leaseholds, or other facilities. Neither the Borrower nor the Guarantor have any indebtedness, obligation, or liability, absolute or contingent, matured or not matured, with respect to the storage, treatment, cleanup, or disposal of any solid wastes, hazardous wastes, or other toxic or hazardous substances (including without limitation any such indebtedness, obligation, or liability with respect to any current regulation, law, or statute regarding such storage, treatment, cleanup, or disposal) which is not disclosed herein: Article V AFFIRMATIVE COVENANTS So long as the Note shall remain unpaid, the Borrower will: Section 5.01. Maintenance of Existence. Preserve and maintain its company existence and good standing in the jurisdiction of its formation. Section 5.02. Maintenance of Records. Keep adequate records and books of account reflecting all financial transactions of the Borrower. Section 5.03. Maintenance of Properties. Maintain, keep, and preserve all of its properties (tangible and intangible) necessary or useful in the proper conduct of its business in good working order and condition, ordinary wear and tear excepted. Section 5.04. Conduct of Business. Continue to engage in an efficient and economical manner in a business of the same general type as now conducted by it on the date of this Agreement. Term Loan Agreement 7 Section 5.05. Compliance With Laws. Comply in all respects with all applicable laws, rules, regulations, and orders, such compliance to include, without limitation, paying before the same become delinquent all taxes, assessments, and governmental charges imposed upon it or upon its property. Section 5.06. Environment. Be and remain in compliance with the provisions of all federal, state, and local environmental, health, and safety laws, codes and ordinances, and all rules and regulations issued thereunder; notify the Lender immediately of any notice of a hazardous discharge or environmental complaint received from any governmental agency or any other party; notify the Lender immediately of any hazardous discharge from or affecting its premises; immediately contain and remove the same, in compliance with all applicable laws; promptly pay any fine or penalty assessed in connection therewith; permit the Lender to inspect the premises, to conduct tests thereon, and to inspect all books, correspondence, and records pertaining thereto; and at the Lender's request, and at the Borrower's expense, provide a report of a qualified environmental engineer, satisfactory in scope, form, and content to the Lender, and such other and further assurances reasonably satisfactory to the Lender that the condition has been corrected. Article VI NEGATIVE COVENANTS So long as the Note shall remain unpaid, the Borrower will not: Section 6.01. Liens. Create, incur, assume, or suffer to exist any Lien upon or with respect to any of its assets assigned or pledged to Lender to secure payment under the Note and performance of all obligations under this Agreement, now or hereafter acquired. Article VII EVENTS OF DEFAULT Section 7.01. Events of Default. If any of the following events shall occur: (1) The Borrower should fail to pay the principal of, or interest on, the Note, or any fee, as and when due and payable; Term Loan Agreement 8 (2) Any representation or warranty made or deemed made by the Borrower in this Agreement, the Guaranty, or the Mortgages shall prove to have been incorrect, incomplete, or misleading in any material respect on or as of the date made or deemed made; (3) The Borrower shall fail to perform or observe any term, covenant, or agreement contained in Articles V, VI, or VII hereof; (4) The Borrower or the Guarantor (a) shall generally not pay, or shall be unable to pay, or shall admit in writing its inability to pay its debts as such debts become due; or (b) shall make an assignment for the benefit of creditors, or petition or apply to any tribunal for the appointment of a custodian, receiver, or trustee for it or a substantial part of its assets; or (c) shall commence any proceeding under bankruptcy, reorganisation, arrangement, readjustment of debt, dissolution, or liquidation law or statute of any jurisdiction, whether now or hereafter in effect; or (d) shall have had any such petition or application filed or any such proceeding commenced against it in which an order for relief is entered or an adjudication or appointment is made, and which remains undismissed for a period of one hundred and eighty (180) days or more; or (e) shall take any corporate action indicating its consent to, approval of, or acquiescence in any such petition, application, proceeding, or order for relief or the appointment of a custodian, receiver, or trustee for all or any substantial part of its properties; or (f) shall suffer any such custodianship, receivership, or trusteeship to continue undischarged for a period of one hundred and eighty (180) days or more; (5) The Guaranty or the Mortgages shall at any time after its execution and delivery and for any reason cease (a) to create a valid and perfected first priority security interest in and to the property purported to be subject to such Mortgages; or (b) to be in full force and effect or shall be declared null and void, or the validity or enforceability thereof shall be contested by the Borrower, or the Borrower shall deny it has any further liability or obligation under the Guaranty or the Mortgages, or the Borrower shall fail to perform any of its obligations under the Guaranty or the Mortgages; or (6) The Lender otherwise deems itself insecure. Section 7.02. Remedies Upon Default. Upon the occurrence of any event of default, the Lender may, by notice to the Borrower, declare the Note, all interest thereon, and all other amounts payable under this Agreement to be forthwith due and payable, whereupon the Note, all such Term Loan Agreement 9 interest, and all such amounts shall become and be forthwith due and payable, without presentment, demand, protest, or further notice of any kind, all of which are hereby expressly waived by the Borrower. Upon the occurrence and during the continuance of any Event of Default, the Lender is hereby authorized at any time and from time to time, without notice to the Borrower (any such notice being expressly waived by the Borrower), to deliver notice to the person obligated under the certificate of deposit to deliver all funds represented by said certificate of deposit to Lender and then to immediately set off and apply any and all such funds against any and all of the obligations of the Borrower now or hereafter existing under this Agreement or the Note or any other Loan Document, irrespective of whether or not the Lender shall have made any demand under this Agreement or the Note or such other Loan Document and although such obligations may be unmatured. The Lender agrees promptly to notify the Borrower after any such setoff and application, provided that the failure to give such notice shall not affect the validity of such setoff and application. The rights of the Lender under this Section 7.01 are in addition to other rights and remedies (including, without limitation, other rights of setoff) which the Lender may have. Article VIII MISCELLANEOUS Section 8.01. Amendments, Etc. No amendment, modification, termination, or waiver of any provision of any Loan Document to which the Borrower is a party, nor consent to any departure by the Borrower from any Loan Document to which it is a party, shall in any event be effective unless the same shall be in writing and signed by the Lender, and then such waiver or consent shall be effective only in specific instance and for the specific purpose for which given. Section 8.02. Notices, Etc. All notices and other communications provided for under this Agreement and under the other Loan Documents to which the Borrower is a party shall be in writing (including telegraphic, telex, and facsimile transmissions) and mailed or transmitted or delivered, if to the Borrower, at its address at: Cascade Quality Molding, Inc. 2-(;O 4,1 Yakima, Washington Attn. Lc vvl I . r ( Term Loan Agreement 10 &1c3 and if to the Lender, at its address at: 129 North Second Street Yakima, Washington 98901 Attention: William R. Cook; or, as to each party, at such other address as shall be designated by such party in a written notice to the other party complying as to delivery with the terms of this Section 8.02. Except as otherwise provided in this Agreement, all such notices and communications shall be effective when deposited in the mails or delivered to the telegraph company, or sent, answer back received, respectively, addressed as aforesaid, except that notices to the Lender pursuant to the provisions of Article II shall not be effective until received by the Lender. Section 8.03. No Waiver. No failure or delay on the part of the Lender in exercising any right, power, or remedy hereunder shall operate as a waiver thereof; not shall any single or partial exercise of any such right, power, or remedy preclude any other or further exercise thereof or the exercise of any other right, power, or remedy hereunder. The rights and remedies provided herein are cumulative, and are not exclusive of any other rights, powers, privileges, or remedies, now or hereafter existing, at law or in equity or otherwise. Section 8.04. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Borrower and the Lender and their respective successors and assigns, except that the Borrower may not assign or transfer any of its rights under any Loan Document to which the Borrower is a party without the prior written consent of the Lender. Section 8.05. Integration. This Agreement and the Loan Documents contain the entire agreement between the parties relating to the subject matter hereof and supersede all oral statement and prior writings with respect thereto. Section 8.06. Indemnity. The Borrower hereby agrees to defend, indemnify, and hold the Lender harmless from and against any and all claims, damages, judgments, penalties, costs, and expenses (including attorney fees and court costs now or hereafter arising from the aforesaid enforcement of this clause) arising directly or indirectly from the activities of the Borrower, its predecessors in interest, or third parties with whom it has a contractual relationship, or arising directly or indirectly Term Loan Agreement 11 from the violation of any environmental protection, health, or safety law, whether such claims are asserted by any governmental agency or any other person. This indemnity shall survive termination of this Agreement. Section 8.07. Governing Law. This Agreement and the Note shall be governed by, and construed in accordance with, the laws of the State of Washington. Section 8.08. Severability of Provisions. Any provision of any Loan Document which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of such Loan Document or affecting the validity or enforceability of such provision in any other jurisdiction. Section 8.09. Headings. Article and Section headings in the Loan Documents are included in such Loan Documents for the convenience of reference only and shall not constitute a part of the applicable Loan Documents for any other purpose. Section 8.11. Attorney Fees. In the event legal action is instituted to determine the rights and duties of the parties hereunder in any state or federal court, including bankruptcy court, the prevailing party in any court action shall be awarded, its reasonable attorney's fees, costs and expenses in pursuing such action in any state or federal court and enforcing such rights and duties determined thereby. Section 8.11. Jury Trial Waiver. THE LENDER AND THE BORROWER HEREBY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM, OR COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT OR THE LOAN DOCUMENTS. NO OFFICER OF THE LENDER HAS AUTHORITY TO WAIVE, CONDITION, OR MODIFY THIS PROVISION. DISCLOSURE ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW. Term Loan Agreement 12 IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written. ATTEST: City of Yakima 129 North Second Street Yakima, WA 98901 Karen Roberts, City Clerk City CASCADE QUALITY MOLDING, INC. By Title CITY OF YAKIMA R. A. Zais, Jr., City Manager City Contract No. 2000-55 Resolution No. R-2000-75 F•\ CLIENTS \DAB\YAKIMA\SIED Program\Cascade Quality\Term Loan Agt.FIN.doc Term Loan Agreement 13 EXHIBIT "A" TO TERM LOAN AGREEMENT Legal Description of Real Property: Parcel A of Short Plat, as recorded in Book "D" of Plats, Page 47 records of Yakima County, Washington, AND the East 10 feet of Lot 4 of Short Plat 85-122, as recorded under Auditor's File Number 2737570, Yakima County, Washington, EXCEPT that portion conveyed to Yakima County by deed recorded February 24, 1997, under Auditor's File Number 7000021. DAB\YAKIMA\SIED Program\Cascade Quality\Exh A to Loan Agt. (legal).doc EXHIBIT "B" TO TERM LOAN AGREEMENT TERM NOTE $ 44,000.00 , 2000 Yakima, Washington FOR VALUE RECEIVED, the undersigned, CASCADE QUALITY MOLDING, INC., a Washington corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of THE CITY OF YAKIMA, (the "Lender"), at its Principal Office located at 129 North 2nd Street, Yakima, Washington, the principal amount of FORTY-FOUR THOUSAND and NO/100 DOLLARS ($44,000.00) in lawful money of the United States and in immediately available funds in ten (10) equal, consecutive annual installments, with the first installment due on May 1, 2001, with subsequent installments on the first day of each May thereafter to and including May 1, 2010, provided, however, that the last such installment shall be in the amount necessary to repay in full the unpaid principal amount of this Term Note, and to pay interest on the unpaid principal amount of this Term Note from the date of this Term Note until such principal amount has been fully repaid at a rate per annum equal to the rate set at Yakima County, Washington's "interfund transfer" rate. Any amount of principal hereof which is not paid when due, whether at stated maturity, by acceleration, or otherwise, shall bear interest from the date when due until said principal amount is paid in full, at the publicly announced prime rate of interest by Bank of America as of the day immediately after the payment due date. If any installment of this Tenn Note becomes due and payable on a day other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day, and interest shall be payable thereon at the rate herein specified during such extension. This Term Note is the Note referred to in, and is entitled to the benefits of, the Term Loan Agreement of even date, between the Borrower and the Lender (the "Credit Agreement"). Terms used herein which are defined in the Credit Agreement Term Promissory Note 1 shall have their defined meanings when used herein. The Credit Agreement, among other things, contains provisions for acceleration of the maturity of this Term Note upon the happening of certain stated events and also for prepayments on account of principal hereof prior to the maturity of this Term Note upon the terms and conditions specified in the Credit Agreement. This Term Note is secured by a Security Agreement referred to in the Credit Agreement, reference to which is hereby made for a description of the collateral provided for under the Security Agreement and the rights of the Borrower and the Lender with respect to such collateral. This Term Note shall be governed by the laws of the State of Washington, provided that, as to the maximum rate of interest which may be charged or collected, if the laws applicable to the Lender permit it to charge or collect a higher rate than the laws of the State of Washington, then such law applicable to the Lender shall apply to the Lender under this Term Note. Venue for any action shall be in Yakima County. Attorney Fees: In the event of any collection activity, or if legal action is instituted to determine the rights and duties of the parties hereunder in any state or federal court, including bankruptcy court, the acting party shall be paid by the other party, or the prevailing party in any court action shall be awarded, its reasonable attorney's fees, costs and expenses in pursuing collection or in bringing such action in any state or federal court and enforcing such rights and duties determined thereby. CASCADE QUALITY MOLDING, INC. By: Title :,����,+—�st——(P .4 F• \CLIENTS \DAB \YAKIMA\SIED Program\Cascade Quality\Exh B to Loan Agt..doc Term Promissory Note 2 EXHI : IT "C" TO TERM LOAN AGREEMENT FILED FOR RECORD AT REQUEST OF: Donald A. Boyd Halverson & Applegate, P.S. P. O. Box 22730 Yakima, WA 98907-2715 MORTGAGE Grantor(s): 1. LARRY L. KRAFT and TERESA M. KRAFT, husband and wife. Grantee(s): 1. THE CITY OF YAKIMA Legal Description: 1. SP Parcel "A", Book "D", Page 47 and East 10' Lot 4 SP 85-122; (Full legal description at page 2) Assessor's Property Tax Parcel Number(s): 1. 181203-14401 MORTGAGE: Mortgagors, Larry L. Kraft and Teresa M. Kraft, husband and wife, hereby mortgage to Mortgagee, The City of Yakima, to secure the payment and performance of the secured obligation as described below, the following described real property situate in the County of Yakima, State of Washington, to -wit: Parcel A of Short Plat, as recorded in Book "D" of Plats, Page 47 records of Yakima County, Washington, AND the East 10 feet of Lot 4 of Short Plat 85-122, as recorded under Auditor's File Number 2737570, Yakima County, Washington, EXCEPT that portion conveyed to Yakima County by deed recorded February 24, 1997, under Auditor's File Number 7000021. SECURED OBLIGATION: This Mortgage is given to secure the payment and performance of all obligations now or hereafter owing by Mortgagor to Mortgagee, including interest thereon, any extensions or renewals thereof, and expenses incurred by Mortgagee in connection therewith. Without limiting the generality of the foregoing, it is specifically understood that this Mortgage is given to secure the repayment of all obligations made by Mortgagee to Mortgagee, including interest thereon, including, without limitation, the terms of the obligation as evidenced by the "Term Loan Agreement" and "Promissory Note" made this _ day of , 2000. GENERAL TERMS OF MORTGAGE: 1. Mortgagor covenants that she is lawfully seized of the property in fee simple and has good right to mortgage and convey it. 2. This Mortgage not only covers the real property described above, but also all improvements and appurtenances thereto, including all water, water rights, shares of water stock or water memberships, irrigation equipment and supplies, and matters appertaining thereto. 3. Mortgagor agrees to pay before delinquency all taxes, special assessments, and other public charges levied, assessed or charged against the mortgaged premises and, further, agrees to keep all fixtures, equipment, and improvements on the said premises insured against loss to the extent of the full insurable value thereof. Mortgagor agrees to make Mortgagee a loss payee on all such policies of insurance. 4. Should Mortgagor default in any of the foregoing agreements or covenants, then Mortgagee may perform the same and may pay any part or all of the principal and interest of any charges against the property, and any amount so paid, with interest thereon at the highest legal rate from date of payment, shall be repayable by Mortgagor on demand, and shall also be secured by this Mortgage without waiver of any right or other remedy arising from the breach of the agreements or covenants. 5. In the event of the transfer of all or any part of Mortgagor's interest in the mortgaged property, whether voluntarily or involuntarily, or by operation of law, Mortgagee may, at its option, treat such transfers a default by Mortgagor and may resort to the remedies as provided for in this Mortgage or as provided for by law. 6. If the interest of Mortgagor in the property secured by this Mortgage is either a purchaser's or seller's interest in a Real Estate Contract for the sale of real property, then Mortgagor hereby specifically acknowledges and agrees that upon default, Mortgagor's interest in the property may be foreclosed by Mortgagee, at its sole option as (a) a Mortgagee under the provisions of RCW Chapter 61.12, et seq.; or (b) under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. 7. Mortgagor agrees that this Mortgage shall also be construed as a security agreement under Article 9 of the Uniform Commercial Code, as adopted in the State of Washington. At Mortgagee's request, Mortgagor agrees to execute and deliver such financing statements as Mortgagee may require to perfect its security interest under the said Uniform Commercial Code. 8. In the event of default by Mortgagor with respect to any of the obligations secured hereby, Mortgagee shall have, in addition to all other remedies and rights at law or in equity, the following rights and remedies: (a) to declare any and all indebtedness secured by this Mortgage to be immediately due and payable; (b) to apply for, with or without notice to Mortgagor upon filing, a suit to enforce or preserve its rights under this Mortgage; (c) to cause the foreclosure of this Mortgage as a Mortgage under the real property or personal property laws of this state; and (d) all other rights and remedies as provided for in this Mortgage. 9. All rights and remedies of Mortgagee provided for in this Mortgage are intended to be cumulative and not in substitution for any other right or remedy otherwise available to Mortgagee. 10. Mortgagor agrees to pay to Mortgagee any and all costs and expenses, including attorney's fees, incurred or paid by Mortgagee in protecting or enforcing its rights under the terms of this Mortgage, whether or not a lawsuit is commenced. "Attorney's fees" shall include services rendered before trial, at trial, and on appeal, as well as services rendered subsequent to judgment and obtaining execution thereof. The award of such fees, costs, and expenses shall bear interest at the highest lawful rate until paid in full. DATED this _ day of , 2000. STATE OF WASHINGTON ) ss. County of Yakima Larry L. Kraft Teresa M. Kraft I certify that I know or have satisfactory evidence that Larry L. Kraft and Teresa M. Kraft, personally appeared before me and signed this instrument and acknowledged it to be their free and voluntary act for the uses and purposes mentioned in the instrument. DATED: , 2000. NOTARY PUBLIC Residing at: My Commission Expires: \DAB\YAKIMA\SIED Program\Cascade Quality\Exh C to Loan Agt. (Mortgage).doc TERM NOTE $ 44,000.00 `r , 2000 Yakima, Washington FOR VALUE RECEIVED, the undersigned, CASCADE QUALITY MOLDING, INC., a Washington corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of THE CITY OF YAKIMA, (the "Lender"), at its Principal Office located at 129 North 2nd Street, Yakima, Washington, the principal amount of FORTY-FOUR THOUSAND and NO/100 DOLLARS ($44,000.00) in lawful money of the United States and in immediately available funds in ten (10) equal, consecutive annual installments, with the first installment due on May 1, 2001, with subsequent installments on the first day of each May thereafter to and including May 1, 2010, provided, however, that the last such installment shall be in the amount necessary to repay in full the unpaid principal amount of this Term Note, and to pay interest on the unpaid principal amount of this Term Note from the date of this Term Note until such principal amount has been fully repaid at a rate per annum equal to the rate set at Yakima County, Washington's "interfund transfer" rate. Any amount of principal hereof which is not paid when due, whether at stated maturity, by acceleration, or otherwise, shall bear interest from the date when due until said principal amount is paid in full, at the publicly announced prime rate of interest by Bank of America as of the day immediately after the payment due date. If any installment of this Term Note becomes due and payable on a day other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day, and interest shall be payable thereon at the rate herein specified during such extension. This Term Note is the Note referred to in, and is entitled to the benefits of, the Term Loan Agreement of even date, between the Borrower and the Lender (the "Credit Agreement"). Terms used herein which are defined in the Credit Agreement shall have their defined meanings when used herein. The Credit Agreement, among other things, contains provisions for acceleration of the maturity of this Term Promissory Note 1 Term Note upon the happening of certain stated events and also for prepayments on account of principal hereof prior to the maturity of this Term Note upon the terms and conditions specified in the Credit Agreement. This Term Note is secured by a Security Agreement referred to in the Credit Agreement, reference to which is hereby made for a description of the collateral provided for under the Security Agreement and the rights of the Borrower and the Lender with respect to such collateral. This Term Note shall be governed by the laws of the State of Washington, provided that, as to the maximum rate of interest which may be charged or collected, if the laws applicable to the Lender permit it to charge or collect a higher rate than the laws of the State of Washington, then such law applicable to the Lender shall apply to the Lender under this Tenn Note. Venue for any action shall be in Yakima County. Attorney Fees: In the event of any collection activity, or if legal action is instituted to determine the rights and duties of the parties hereunder in any state or federal court, including bankruptcy court, the acting party shall be paid by the other party, or the prevailing party in any court action shall be awarded, its reasonable attorney's fees, costs and expenses in pursuing collection or in bringing such action in any state or federal court and enforcing such rights and duties determined thereby. CASCADE QUALITY MOLDING, INC. By: Title : F•\CLIENTS\DAB\YAHIMA\SIED Program\Cascade Quality\Term Note.doc Term Promissory Note 2 RESOLUTION NO. R-2000- 7 5 A RESOLUTION authorizing the City Manager to execute a loan agreement with Cascade Quality Molding, Inc , to lend it not more than $44,000 for which funding has been awarded by the Yakima County Supporting Investments in Economic Development (SIED) fund. WHEREAS, on March 21, 2000, the City Council authorized submittal of an application to Yakima County on behalf of the Cascade Quality Molding Project (the "Project") for financial assistance combining a grant and a loan from Supporting Investments in Economic Development ("SIED") funds to offset the costs of developing Project -related infrastructure including road, curb, gutter, sidewalks located at South 26th Avenue and Ahtanum Road; and WHEREAS, on April 6, 2000, the SIED advisory board voted to recommend to the Yakima County Commissioners an offer to the City of Yakima of $88,000 of SIED financial assistance in the form of 50% grant and 50% loan for the Project; and WHEREAS, Cascade Quality Molding, Inc., has offered, according to the terms of the attached loan agreement, to pay the City all amounts the City would become obligated to pay under the loan component of the prospective SIED financial assistance; and WHEREAS, the Yakima County Commissioners are expected to adopt the SIED advisory board's recommendation on June 6, 2000; and WHEREAS, the City Council deems it to be in the best interest of the City that the City accept the prospective SIED financial assistance, and now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The City Manager is hereby authorized and directed, after verifying that Yakima County is committed to awarding the financial assistance described above, to execute an agreement substantially in the form of the attached loan agreement with Cascade Quality Molding, Inc. to lend it not more than $44,000 and to enter into such other agreements or to take such other actions as may be necessary and prudent to accept and use the financial assistance offered by Yakima County from the Supporting Investments in Economic Development (SIED) fund for the Cascade Quality Molding Project. ADOPTED BY THE CITY COUNCIL this 6th day of June 2000. SI MARY PLACE ATTEST: /s/ KAREN S. ROBERTS Karen Roberts, City Clerk (a) Resolution Cascade Quality Molding loan agreement, 05/31/00,2:12 PM Mary Place, Mayor 4.7u., . _=3 cIrir c T�Yrr i r BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No.6 A - For Meeting of:iune 6, 2000 ITEM TITLE: Consideration of a resolution authorizing the City Manager to execute a loan agreement with Cascade Quality Molding in oamountrtingnot e ttments exceed EconomOiCfor which Development has been awarded by the Yakima County pp (SIED) program. SUBMITTED BY: f/' illiam Cook, Director of Community and Economic Development CONTACT PERSON/TELEPHONE: William Cook 575-6227 SUMMARY EXPLANATION: On March 21, 2000, the City Council approved a resolution authorizing submission of a grant and loan application to the Yakima County SIED fund for the Cascade Quality Molding Project. The SIED board voted to approve the application for $88,000 on April 6, 2000. SIED funds will be awarded to the City in the form of a 50% loan to be repaid by the developer and a 50% grant. SIED funding will pay for widening of Ahtanum Road to four lanes, and the construction of curb and gutter fronting property located at South 26th Avenue and Ahtanum road. The improvements are required for the -construction of a new manufacturing facility for Cascade Quality Molding, Inc., which will expand its existing operations when the facility is completed. The estimated cost for infrastructure improvements related to the Cascade expansion is $88,000. In addition, the City will leverage the private investment of road improvements funded by Cascade Quality Molding together with availablefederal 16th avenue westtoto the lt imits s. The The complete cost widening, to four lanes, of Ahtanum Road of all improvements related to the project is estimated at $496,500.00. Cascade Quality Molding specializes in custom injection molding and plastic parts from design through production. Cascade serves original equipment manufactures, as well as the electronics, aerospace and agricultural industries. Cascade the medical, pelect on csy communications pports mancustomers and pandusem a vanety of custom parts and products for conductor industries. Resolution X Ordinance Contract:" Other Specify: Loan Agreement Funding Source: Yakima County SIED Fund APPROVAL FOR SUBMITTAL: - City Manager STAFF RECOMMENDATION: Staff recommends approval of the resolution. BOARD/COMMISSION RECOMMENDATION: COUNCIL ACTION: QTY QQ YAI JIMA CITY CLERKS OFFICE 129 North Second Street, Yakima WA 98901 TELEPHONE (509) 575-6037 FAX: (509) 575-6107 NOTICE OF COUNCIL ACTION DATE: June 8, 2000 TO: Bill Cook/Judy Arington FROM: Linda Watkins, City Clerk's Office RE: Notification of Council Action Taken Cascade Quality Molding Loan Agreement The Yakima City Council, at its 6/06/00 , meeting has considered the above mentioned topic, of which the following is provided: (X) Attachment provided for your record keeping purposes: Certified Copy of Resolution No. R-2000-75 (X) Documents enclosed: Two duplicate originals of the contract (City Contract No. 2000-55. Please have the contracts signed and dated and return one fully executed original to: City Clerk City of Yakima 129 North Second Street Yakima, WA 98901 Donald A. Boyd May 31, 2000 LAW OFFICES OF HALVERSON & APPLEGATE, P.S. 311 NORTH FOURTH STREET MAILING ADDRESS: P.O. BOX 22730 YAKIMA, WASHINGTON 9890 7-27 15 Mr. Richard A. Zais City Manager, City of Yakima City Hall North Second "B" Street Yakima, Washington 98901-2830 Re: Ahtanum Road Project Loan to Cascade Quality Molding, Inc. / Kraft Dear Mr. Zais: TELEPHONE 509-575-6611 FACSIMILE 509-457-2419 I write with regard to the City's proposed loan to Cascade Quality Molding, Inc. which is intended to provide for payment of infrastructure improvements along Ahtanum Avenue adjacent to their commercial property located at 2601 Ahtanum Road, Yakima Cascade Quality Molding, Inc., is a valid Washington corporation owned by Larry and Teresa Kraft. Bill Cook asked that I prepare loan documents to give the City a second mortgage against the commercial property and against the Krafts' personal residence located at 615 South 23rd Avenue, Yakima I have prepared the following documents relating to this loan, which are attached hereto: 1. Term Loan Agreement; 2. Term Promissory Note; 3. Mortgage (on business property) 4. Personal Guaranty; and, 5. Mortgage (on residence property) Mr. Richard A. Zais May 31, 2000 Page 2 I have also reviewed the following documents provided by others: 6. Yakima County and City of Yakima lending agreement prepared by the County; 7. Financial statements provided by the Krafts; 8. Appraisal by Low & Associates dated November 5, 1999 on the commercial property listing a "completion value" of $1,120,000.00; 9. Letter dated March 20, 2000 from Low & Associates; 10. Title Report dated January 21, 2000 on the commercial and residential property; 11. Letter dated May 25, 2000 from Teresa Kraft to Bill Cook explaining payoff of encumbrances listed on title report; 12. Deed of Trust from Kraft to Yakima County dated January 25, 2000 on commercial property in the amount of $270,000.00.; and 13. Construction Deed of Trust from Kraft to Yakima National Bank dated January 31, 2000 on commercial property in the amount of $676,598.00. Based upon the representations set forth in these latter documents, and assuming closing of this transaction with proper recording of the mortgage documents, I believe that the City will hold a junior secured position in the commercial property sufficient to adequately secure repayment of its loan to Cascade Quality Molding, Inc. As additional security, the City will have a junior mortgage position against the Krafts' residence. The junior position on the commercial property will be subordinate only to the Yakima National Bank and Yakima County mortgages that have a total value of about $950,000.00. The junior position on the residential property will be subordinate only to the Yakima National Bank and PHM Mortgage Services mortgages. The P1111 mortgage is for $127,000.00. The City's debt will be secured primarily by the commercial property at this time as the residence value is substantially subsumed by the PHH mortgage. Nonetheless, the Krafts' personal guaranty secured by the mortgage on their residence provides good additional security for the City's loan. As of the date of dosing we should have an updated title report on the properties and require that both Yakima National Bank and the County provide the City with statements as to the value of their debts so that we can be best assured of our equity position. Mr. Richard A. Zais May 31, 2000 Page 3 Should you have any questions with regard to this matter, please call. Very truly yours, Donald A. Boyd DAB:pb Encls. F.\ CLIENTS \DAB\YAK MA\SLED Program\Cascade Quality\ZAISO53100.1tr.doc Watkins, Linda From: Arington, Judy Sent: Wednesday, January 17, 2001 4:27 PM To: Watkins, Linda, Wiltsey, Michelle Subject: Kraft file (Cascade Quality Molding Contract) Michelle or Linda, Teresa Kraft called to let us know they have changed their mailing address for this contract to: Cascade Quality Molding, Attn: Larry Et Teresa Kraft, 2607 Ahtanum Road. If you would put this note with their contract, I would appreciate it. Thanks Judy AK to -vv Office Administrator Department of CED, City of Yakima Personal phone: 576-6613 Dept. phone: 575-6113 1 RESOLUTION No. R-2001-90 A RESOLUTION authorizing and ratifying approval of 1) amendment #2 for Contract #YC - CM -00 between the City of Yakima and Yakima County and 2) authorizing and directing the City Manager to execute a similar amendment to the loan agreement between the City of Yakima and Teresa and Larry Kraft WHEREAS, In June 2000 Council approved a loan agreement with Yakima County and a second loan agreement with Teresa and Larry Kraft to provide $44,000 of Supporting Investments in Economic Development (SIED) funds for improvements to Ahtanum Road; and WHEREAS, it was envisioned that the Ahtanum road project would be constructed in the spring of 2001 with repayment of the Kraft's loan to the City and the City's repayment of our loan to the County to begin in June 2001; and WHEREAS, scheduling delays have resulted in the project being scheduled for construction later this summer (i.e. 2001); and WHEREAS, the City of Yakima has submitted to the County a request to amend the City's contract with the County to extend the date for the first repayment to June 1, 2002; and WHEREAS, the County Board is scheduled to act on this contract amendment on the morning of June 5, 2001; and, WHEREAS, the City Council deems it to be in the best interest of the City of Yakima to authorize execution of 1) the attached amendment to Contract #YC -CM -00 between the City of Yakima and Yakima County and 2) a similar extension of time for repayment of the loan made by the City of Yakima to Teresa and Larry Kraft, now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The City Manager's execution of the attached Amended Agreement with Yakima County is hereby authorized and ratified, and furthermore the City manager is authorized and directed to execute a similar amendment to the loan agreement between the City of Yakima and Teresa and Larry Kraft. ADOPTED BY THE CITY COUNCIL this 5th day of June, 2001. MI KAPF S. 08.F.F TS, C C ATTEST: Karen S. Roberts, City Clerk SI MARY PLACE Mary Place, Mayor Certified to be a true and correct copy of the tirigival filed in my office. CITY CLERK Deputy BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. 1 a" For Meeting Of June 5, 2001 ITEM TITLE: 1) Ratify contract Amendment #2 for Contract #YC -CM -00 between the City of Yakima and Yakima County, and 2) Approve a similar amendment to the City of Yakima's contract with Teresa and arry Kraft p SUBMITTED BY: " WViilliam Cook, Director of Community & Economic Development CONTACT PERSON/TELEPHONE: William Cook, (575-6113) SUMMARY EXPLANATION: In June 2000, by Resolution No. R-2000-76, Council approved a loan agreement with Yakima County and a second related loan agreement with Teresa and Larry Kraft to provide $44,000 of Supporting Investments in Economic Development (SIED) funds for improvements to Ahtanum Road in front of the Kraft's new manufacturing facility at 26`h Avenue and Ahtanum Road, Yakima. Under these agreements Yakima County lends SIED funds to the City and in turn the City lends these funds to a pnvate developer for construction of public roads, sewer and/or water. It was originally envisioned that the Ahtanum Road project would be constructed in the spring of 2001 and the original contract called for repayment by the Kraft's to the City and from the City back to the County beginning in June 2001. As a result of scheduling delays, the project is now scheduled for later this summer (i.e. 2001). As a result we have submitted to the County a request to amend the City's contract with the County to extend the date for the first repayment to June 1, 2002. The County Board is scheduled to act on this contract amendment on the morning of June 5th. By this action Council is being requested to 1) ratify contract amendment #2 for the contract between the City and County and 2) approve a similar amendment to the City's contract with the Kraft's. Resolution X Ordinance Other (Specify) Contract Mail to (name and address): Phone: Funding Source \� APPROVED FOR SUBMITTAL: City Manager STAFF RECOMMENDATION: Approve the attached resolution BOARD/COMMISSION RECOMMENDATION: COUNCIL ACTION: Resolution adopted. RESOLUTION NO. R-2001-8 AMENDMENT 2 SIED CONTRACT NO. YC -CM -00 IT IS HEREBY AGREED between Yakima County and the City of Yakima that Subsection V. of the parties SLED Contract No. YC -CM -00, made June 6, 2000, and relating to the loan of County SIED funds for the City of Yakima's Cascade Molding project, is amended, effective, this 51± day of alln� , 2001, as set forth below This amendment is made in recognition of certain biological assessment delays, unforeseen by the parties, occurring since the date of the parties original Contract and affecting the relations of the parties under that Contract. Except for the amended terms of Subsection V., which are set forth below, the original terms and conditions of SIED Contract No YC -CM -00 shall remain in full force and effect. V. MUTUAL CONSIDERATION A. COUNTY LOAN—The County shall loan Forty Four Thousand Dollars and Zero Cents ($44,000.00) for the Project described herein. This loan amount shall be by check drawn on the SIED Fund and payable to the City immediately upon approval of this Amendment by both parties. B. REPAYMENT OF COUNTY LOAN—The City shall repay the County's loan of Forty Four Thousand Dollars and Zero Cents ($44,000.00) with interest on unpaid principal, at an annual per annum rate f 4 2D %, which is the Washington State Local Government nvestment Pool Rate on the date this Amendment is approved by the County Repayment of principal and interest shall be made in ten (10) annual installments. The first payment shall be due in June 1, 2002, and annual payments thereafter shall be due on June 1 of each year with the final payment nevertheless due on June 1, 2011; provided however, that the final installment may be in such greater or lesser amount as shall be required for full amortization of the repayment amount. These payments shall be by check payable to Yakima County Infrastructure Fund and delivered to Yakima County Treasurer, Yakima County Courthouse, Room 115, 128 North 2nd Street, Yakima, WA 98901. The City obligation hereunder shall be a limited general obligation of the City, payable from any legally available source of funds. Exhibit A attached hereto and incorporated herein reflects the Debt Service Schedule as noted 1 SIED Contract No YC -CM -00 Amendment 2 C. COUNTY GRANT—The County shall grant Forty Four Thousand Dollars and Zero Cents ($44,000.00) to the City for the Project described herein. This grant shall be by check drawn on the SIED Fund and payable to the City within thirty (30) days of the County's receipt of a signed copy of the Project engineer's certificate that 50% of the work on the Project has been completed and the City's invoice for said grant. D. OWNERSHIP AND USE—The City shall construct, own, maintain, and operate the Project as a part of its public infrastructure for economic development, available for use by manufacturing and industrial concerns proximate to the Project. The City shall also permit the use of the Project by the County and its departments on like terms with other users, at such time as the Board of Yakima County Commissioners may deem expedient For purposes of this paragraph, ownership, maintenance, and operation of the Project or any portion thereof by another municipality, under any conveyance or dedication which is subject to and preserves the County's right of use, shall be deemed ownership, maintenance, and operation by the City. YAK_IMA COUNTY Steve Hill, Director ,1 1 1 ! _ L J Wl ") Date BOARD OF YAKIMA COUNTY COMMISSIONERS James M. Le airman CONTRACT AUTHOR�I� 1/41,, rn��rn rrc crni•IPR , O , ...... Ca '/i• uviruriiv Divi .� i' •���• / v f rrgS Resolution No . ; G-24`.; �•i I 1!):::.r°* CITY OF YAKIMA R.A. Zais, Jr , City Manager Date ATTEST ,> TNs -.7A,.... .Y 71 w -`1V��'u 4' "':J yr Karen Roberts, City Clerk S -a -0/ Date x,000 S 6 CITY CONTRACT NO: RE3C, U N Not: BOARD OF YAKIMA COUNTY Attest CPerk of the Board Th— ylvia E. Cervantes �2a 2 SIED Contract No YC -CM -00 Amendment 2 RESOLUTION No. R-2001-90 A RESOLUTION authorizing and ratifying approval of 1) amendment #2 for Contract #YC - CM -00 between the City of Yakima and Yakima County and 2) authorizing and directing the City Manager to execute a similar amendment to the loan agreement between the City of Yakima and Teresa and Larry Kraft WHEREAS, In June 2000 Council approved a loan agreement with Yakima County and a second loan agreement with Teresa and Larry Kraft to provide $44,000 of Supporting Investments in Economic Development (SIED) funds for improvements to Ahtanum Road; and WHEREAS, it was envisioned that the Ahtanum road project would be constructed in the spring of 2001 with repayment of the Kraft's loan to the City and the City's repayment of our loan to the County to begin in June 2001; and WHEREAS, scheduling delays have resulted in the project being scheduled for construction later this summer (i.e. 2001); and WHEREAS, the City of Yakima has submitted to the County a request to amend the City's contract with the County to extend the date for the first repayment to June 1, 2002; and WHEREAS, the County Board is scheduled to act on this contract amendment on the morning of June 5, 2001; and, WHEREAS, the City Council deems it to be in the best interest of the City of Yakima to authorize execution of 1) the attached amendment to Contract #YC -CM -00 between the City of Yakima and Yakima County and 2) a similar extension of time for repayment of the loan made by the City of Yakima to Teresa and Larry Kraft, now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The City Manager's execution of the attached Amended Agreement with Yakima County is hereby authorized and ratified, and furthermore the City manager is authorized and directed to execute a similar amendment to the loan agreement between the City of Yakima and Teresa and Larry Kraft. ADOPTED BY THE CITY COUNCIL this 5th day of June, 2001. 13/ KAREN S. ROBERTS, CMC ATTEST: Karen S. Roberts, City Clerk S/ MARY PLACE Mary Place, Mayor Certified to be a true and correct opy of the m original filed in y office. p6O/�l % By CITY CLERK i6j' Deputy Donald A. Boyd July 7, 2000 LAW OFFICES OF HALVERSON & APPLEGATE, P.S. 311 NORTH FOURTH STREET MAILING ADDRESS: P.O. BOX 22730 YAKIMA, WASHINGTON 98907-2715 William R. Cook, Director City of Yakima Department of Community and Economic Development 129 North Second Street Yakima, Washington 98901 TELEPHONE 509-575-6611 FACSIMILE 509-457-2419 REceiven L. 1 f_. Top L. COMMUNil Y ikaLQp fr Re: City/Cascade Quality Molding Dear Bill: I enclose the following original documents signed by Larry and Teresa Kraft: 1. Term Loan Agreement; 2. Term Promissory Note; 3. Mortgage on business property; 4. Unconditional Guaranty (personal); and 5. Mortgage on personal residence. Please fill in the two blank areas on page 2 of the Loan Agreement and call Larry with the information needed for him to fill in the areas on his duplicate original of the Agreement. Then, please have the mortgages recorded so that the City's lien position is perfected in the business property and the Kraft's personalresidence. I will receive the recorded mortgages within a week after recording and will _return those originals to you. Please -•keep all tl a or gii al docum64044,safe'place as those : �, �'.?.�a :.� r, �. .�.,.. :cM. y w -, _. ,w.., .rYrt�'xs: taa.:w .,�.,�. ,will need to be returned to the Krafts When the payoff.the loan. I thank you again for allowing me to assist you on this project. It is a pleasure working with you on improving the small' businesses of Yakima. I will maintain William R. Cook, Director July 7, 2000 Page 2 copies of the documents in my file. I will close the file at the endof J1.4; as all matters should be completed by then. Very truly yours, a/2 Donald A. Boyd DAB:pb Encls. cc: Ray Paolella, w/o encl. DAB\YAKIMA\SIED Program\Cascade Quality\Cook0707001tr.doc