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R-2015-051 Sports Facility Management Agreement and Property Lease Agreement with SOZO Sports of Central Washington
RESOLUTION NO. R-2015-051 A RESOLUTION authorizing an agreement with SOZO Sports of Central Washington for the development, management and operation of a premier soccer/multi-sport campus and indoor sports facility to serve the citizens of the City of Yakima and the Yakima area WHEREAS, SOZO Sports of Central Washington is a Yakima -based non-profit corporation having the experience, desire, ability and resources to purchase, design, develop, maintain and operate a premier sports complex offering soccer and multi -sport opportunities to the citizens of Yakima, and WHEREAS, the City has dedicated funds available in the Capital Fund to contribute toward the acquisition of property and toward the development of portions of the proposed Yakima Sports Park; and WHEREAS, a premier Sports Complex would provide the City's youth and adults with soccer and recreational opportunities with a first-class development, while generating significant economic opportunity to the City and the surrounding area, and WHEREAS, the City currently has a total of only eleven soccer fields available to the citizens for general use; this number is insufficient to support the local needs or to attract outside users in any significant numbers, and WHEREAS, the proposed Sports Complex will provide seventeen outdoor fields, some of which will be engineered turf surfaces and some of which will be lighted, as well as an indoor soccer/sports facility, and WHEREAS, the Sports Complex will also provide passive recreational opportunities to the citizens of Yakima in the way of outdoor activities available when the sport fields are not in use; and WHEREAS, the City Council finds it to be in the best interests of the City of Yakima to enter into the attached and incorporated SOZO Sports Agreement to better meet the sports and recreational needs of the citizens of Yakima, Now, Therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The City Manager of the City of Yakima is hereby authorized and directed to execute the attached and incorporated Agreement between the City and SOZO Sports of Central Washington to acquire and develop a premier soccer/multi-sport complex within the City of Yakima ADOPTED BY THE CITY COUNCIL this 7th day of April, 2015. AIT -EST: Micah Cawle , Mayor Sonya'dlaar Tee AGREEMENT THIS AGREEMENT ("Agreement") is entered into effective the J -11 ' day of n , 2015 (the "Effective Date"), by and between the City of Yakima, a Washington municipal corporation ("City"), and SOZO Sports of Central Washington, Incorporated, a Washington non-profit corporation ("SOZO"). The City and SOZO are referred to collectively as the "Parties." In consideration of the promises, covenants, and provisions set forth in this Agreement, the Parties agree as follows: ARTICLE 1 RECITALS AND FINDINGS 1.1 Property. SOZO plans to purchase property located south of the Yakima Air Terminal, legally described in Exhibit A, attached hereto and incorporated herein by this reference. The property is located contiguous to the City limits on two sides of the property but is not within the City limits. SOZO intends to acquire the property from Bohannon. The property described in Exhibit A may sometimes herein be referred to as the "Bohannon Property". Upon SOZO's purchase of the property SOZO will apply for annexation to the City. Upon successful completion of the annexation, which the City pledges to support throughout the required process, the City shall purchase from SOZO a specified portion of approximately forty (40) acres of the Bohannon Property for the appraised value of the property, said specified portion to exclude that portion described hereinbelow as the SOZO Sports Campus. As the owner the City will lease the property so purchased, referred to as the "Yakima Sports Park", to SOZO and SOZO will develop the Yakima Sports Park as specifically set forth herein, in addition to developing SOZO's own parcels. From the Bohannon Property, SOZO has also arranged to convey a specified portion thereof to a sponsoring entity, Cleat City, LLC, said specified portion to consist of approximately twenty (20) acres of land upon which Cleat City will construct buildings and other improvements for utilization by soccer participants and others and shall lease them to SOZO. Approximately five (5) years after commencement of the Lease referred to hereinbelow, Cleat City, LLC shall convey those improved properties to SOZO for utilization in conjunction with the Yakima Sports Park as described herein. The portion of the Bohannon property to be conveyed to Cleat City has no current legal description, but is intended by the Parties to comprise approximately twenty (20) acres in the southeastern corner of the Bohannon Property approximating a square, the precise size, configuration and servitudes of which shall be determined by SOZO and Cleat City, but not in derogation of this Agreement. Parties agree that the property owned by SOZO and the property leased by SOZO from Cleat City (both prior to and following its conveyance from Cleat City) shall be referred to herein, from time -to -time, as "the SOZO Sports Campus". The entirety of the Bohannon Property and the SOZO Sports Campus may be referred to herein as "the Yakima Sports Complex". A proposed Building and Site Plan depicting preliminary intent of the Parties is attached hereto as Exhibit B and Agreement Between City of Yakima and -1- SOZO Sports of Central Washington incorporated herein by this reference. In order to ensure the availability of necessary irrigation water for the proposed Yakima Sports Complex, it is understood and agreed that all water rights associated with the Bohannon Property shall remain appurtenant to the Yakima Sports Complex and may be utilized with any portion or portions of the Yakima Sports Complex as SOZO may determine, not inconsistent with state law. 1.2 SOZO. SOZO has the experience, ability, and resources to develop and operate the athletic, recreation and associated facilities at the Yakima Sports Complex. SOZO intends to develop a regional facility to provide premier soccer and other, related athletic and recreational uses, to serve multi- age soccer teams within an approximate ,O mile radius from the boundaries of the Yakima Sports Complex (the "service area"). ,,•/""N 1.3 Facilities. The Parties intend this Agreement to specifically identify the terms by which SOZO is granted the exclusive rights to lease the Yakima Sports Park from the City and to develop, construct, and operate SOZO Sports Campus and the Yakima Sports Complex, as described more fully in attached Exhibit C. SOZO shall operate concessions and impose fees and charges within areas of the Yakima Sports Complex, described herein, notwithstanding that the Yakima Sports Park and all publicly funded improvements thereon shall remain property of the City. 1.4 No Partnership. The Parties agree that no joint venture or partnership is formed as a result of this Agreement. 1.5 Premises. SOZO shall be responsible for the complete design and construction of the Yakima Sports Complex and associated landscaping. All improvements to the Yakima Sports Park shall remain the property of the City at the termination of this Agreement. 1.6 City Police Power. By entering this Agreement, the City does not waive any of its police power authority and shall retain granting authority over final permits for the Yakima Sports Complex, consistent with the intent of this Agreement, approval of which permitting shall not be unreasonably withheld or delayed. 1.7 Access and Parking. The City will improve the public streets providing access to the Park; SOZO will be responsible to provide adequate parking to support the Yakima Sports Complex and its operations, as required by M-1 zoning as anticipated by the Parties. SOZO also agrees to provide all costs Agreement Between City of Yakima and -2- SOZO Sports of Central Washington associated with the installation of signalization for traffic control at the intersection of 38th Avenue and Ahtanum Blvd. 1.8 Financing. 1.8.1 SOZO will be responsible for obtaining all necessary financing for the development and operation of the Yakima Sports Complex, subject only to City participation as described in Article 5.10, herein. 1.8.2 It is mutually understood by the Parties that any lender who provides financing to SOZO for the development and operation of the SOZO Sports Campus will require this Agreement as protection and security for lender ("lender"). The term "lender" shall also mean the successors and assigns of the lender. 1.8.3 The City will acknowledge and consent to a lender taking a first position security interest in this Agreement, the Lease and the SOZO Sports Campus under mutually agreeable terms; lender taking an assignment of the right, title, claim and interest of SOZO in this Agreement; lender obtaining the right of substitution for SOZO, lender taking possession of the SOZO Sports Campus; lender operating the Yakima Sports Complex pursuant to the terms of this Agreement; and/or, lender selling, assigning and/or transferring SOZO's interest in this Agreement, the Lease, and/or the SOZO Sports Campus. ARTICLE 2 GROUND LEASE AND USE GRANT 2.1 Yakima Sports Complex. 2.1.1 City shall by separate lease instrument, forthwith upon gaining title thereto, convey and grant unto SOZO an exclusive lease of the Yakima Sports Park, for the development, construction and operation of that portion of the Yakima Sports Complex, as described herein. The Lease shall set forth, in substance, the intended outcome, terms and conditions of the operation of this Agreement. A preliminary building and site plan is shown in Exhibit B, attached hereto and incorporated herein by this reference. Any and all development, construction, and improvements of and to the SOZO Sports Campus are or shall be owned by or leased to SOZO subject to security interest of lender, if any. At the termination of this Agreement and the Lease, other than as a result of condemnation proceedings, the then existing improvements to the Yakima Sports Park shall remain the property of and be solely owned by the City. 2.1.2 The common address of the Yakima Sports Complex is Yakima, WA 98908. 2.2 Possession, Quiet Enjoyment and Covenants. Agreement Between City of Yakima and -3- SOZO Sports of Central Washington Except as provided in Article 4.13 herein, SOZO shall be entitled to exclusive possession and use of the Yakima Sports Park upon effective date of the Lease. Upon taking possession of the Yakima Sports Park, and subject to SOZO's continuing performance under this Agreement and the Lease, SOZO shall peaceably and quietly have, hold, and enjoy the Yakima Sports Park at all times during the full term of this Agreement and the Lease. Every covenant in this Agreement and the Lease shall be deemed and treated to be a covenant running with the Yakima Sports Park during the full term of the Lease and this Agreement, and shall extend to the heirs, legal representatives, successors and assigns of the Parties. No change in City's ownership of the Yakima Sports Park, or rights to the payments hereunder, however accomplished, shall operate to enlarge the obligations or reduce the rights of SOZO. No change in City's ownership of the Yakima Sports Park shall be binding upon SOZO for any purpose until SOZO shall have been given written notice thereof. ARTICLE 3 TERM OF AGREEMENT 3.1 Term. The Term of this Agreement and the Lease shall be forty (40) years, commencing upon the Effective Date of the Lease. 3.2 Option to Renew. So long as SOZO is not then in material, uncured breach of the Lease or this Agreement, it shall have the privilege of extending this Agreement and the Lease for two (2) additional ten (10) year terms upon the same terms and conditions, subject to any modifications as provided in Section 9.13 below. In order to exercise said renewal option(s), SOZO shall provide written notice to City not less than twelve (12) months prior to termination of the then current term of the Lease. ARTICLE 4 SOZO OBLIGATIONS 4.1 Agreement. SOZO agrees to the terms and conditions of this Agreement. 4.2 Not -For -Profit. SOZO will serve as the controlling, authorized entity responsible for enhancement and ongoing operation of the Yakima Sports Complex. Agreement Between City of Yakima and -4- SOZO Sports of Central Washington 4.3 Investment. SOZO will raise and invest not less than Four Million dollars ($4,000,000) in capital expenditures, loans and/or pledges for the design, development and operation of the Yakima Sports Complex, including the initial funding of SOZO operations, acquisitions and expenses provided by Cleat City, LLC and/or its principals. 4.4 Athletic Center Building. SOZO will construct an athletic center building on the SOZO Sports Campus parcel with at least two indoor soccer facilities and associated uses to include, but not limited to concession sales, pro shop, locker room facilities, three basketball courts, batting cages, office space, training programs, league play, and tournaments to the youth and adults of the City and the surrounding service areas. 4.5 Synthetic Turf Fields. SOZO will construct a minimum of three outdoor lighted engineered FIFA -sized, championship - quality synthetic turf soccer fields (or equivalent) and two indoor engineered fields and will make these fields available to the youth and adult teams from the City and surrounding service areas. 4.6 Grass Fields. SOZO will construct and maintain fourteen full size grass soccer fields and will make these fields available to the youth and adult soccer teams from the City and surrounding service areas. 4.7 Education — Scholarships. 4.7.1 SOZO will provide athletic skills, educational and development programs. SOZO will also provide team fee scholarships for disadvantaged youths from the City and surrounding service areas. 4.7.2 SOZO, as part of its community involvement program, will provide scholarships, grants, awards, and other benefits to the underprivileged as SOZO shall, in good faith, determine from time -to -time, taking into account its net profitability from operation of the Yakima Sports Complex, its need to fund future operations, improvements and acquisitions, and reflecting the intent of the Parties as set forth in this Agreement. SOZO's minimum annual contribution toward meeting this goal shall be no less than five percent (5%) of the net annual revenue derived from Yakima Sports Complex operation. The City may assist SOZO in this effort by publicizing availability of scholarships and recommending to SOZO worthy potential recipients of such scholarships who may have come to the attention of the City. Agreement Between City of Yakima and -5- SOZO Sports of Central Washington 4.8 SOZO Liaison. Upon City request, SOZO will provide a dedicated contact person and liaison with the City for all permit and license applications, changes and variances to complete the SOZO Sports Complex in an expedited manner. 4.9 SOZO Sports Campus and Yakima Sports Complex. SOZO will be fully responsible for all costs of improvement, operation and maintenance of the Yakima Sports Complex, except as described in Section 5, below. 4.9.1 Incidental Uses. SOZO may provide and/or authorize concessions, to include but not be limited to food and beverages; sale of incidental items directly related to the use of the SOZO Sports Campus including, but not limited to, pro shop athletic equipment, clothing, awards and related merchandise; soap, shampoo, sundries and supplies; day-care/babysitting service, fitness and sport training and gym activities. 4.9.2 Security and Nuisance During Use. SOZO shall take reasonable precautions to secure the Yakima Sports Complex throughout the full term of this Agreement. SOZO shall not use the Yakima Sports Complex for unlawful purposes and shall not use or occupy the Yakima Sports Complex in any manner that would constitute a public nuisance or violate Federal, State or local laws. 4.9.3 Operating Hours — Activities. The availability of recreational opportunities for City residents is a material consideration for this Agreement. SOZO and the CITY intend to generate active and passive uses for the Yakima Sports Park to serve the general public when not anticipated for use as a soccer facility or other pre -scheduled events. SOZO recognizes that the Yakima Sports Park's primary purpose is to provide community youth sports activities when the fields are not in use for specific pre - scheduled events; the Yakima Sports Park shall be made available to the youth and adult teams from the City and surrounding service areas. Except as specifically provided herein, the general public shall retain access during regular business hours to the Yakima Sports Park, which access may include "passive" individual activities that include, but are not limited to walking and jogging. Accordingly, throughout the full term of this Agreement SOZO shall continuously conduct and carry on SOZO's permitted uses and shall keep the Yakima Sports Park open for business and cause SOZO's business to be conducted therein during the usual business hours of each and every business day as shall be determined by SOZO based upon commercially reasonable standards. This provision shall not apply if the Yakima Sports Complex should be closed and the business of SOZO is temporarily suspended on account of labor strikes, lockouts, or similar causes beyond the reasonable control of SOZO, or for maintenance, remodeling, repair, or renovation as provided in the Lease. SOZO covenants and agrees to provide sufficient Agreement Between City of Yakima and -6- SOZO Sports of Central Washington personnel, and to keep the SOZO Sports Campus adequately stocked with merchandise, recreational equipment, fixtures and facilities so as to conduct its business in accordance with sound business practice. SOZO, in order to keep its business commitments, shall be in operation in accordance with standard business practices. 4.10 Entry by City. City may, during normal operating hours, enter the Yakima Sports Park at all times to inspect, provide services required hereunder, post notices of SOZO's noncompliance with the provisions of this Agreement or the Lease, all without being deemed a constructive eviction. Any person or persons who may have an interest in the purpose of City's visit may accompany City. City has the right to use any and all means that City deems proper to open doors and gates in an emergency in order to obtain entry to the Yakima Sports Park. 4.11 Health Inspections. SOZO shall not knowingly commit or willfully permit to be committed any negligent act or thing contrary to the rules and regulations prescribed by the local board of health, or which shall be contrary to the laws, rules or regulations of any federal, state or municipal authority. SOZO shall allow the Yakima County Health Department to make regular and ordinary inspections of the Yakima Sports Complex as said health department may deem proper. 4.12 Maintenance, Repair, Improvements. 4.12.1 Maintenance. SOZO shall, at its sole cost and expense, clean and maintain the Yakima Sports Complex, and make repairs, restorations, and replacements to the Yakima Sports Complex, including without limitation the heating, ventilating, air conditioning, mechanical, electrical, and plumbing systems, structural roof, walls, and foundations, roof coverings, sprinkling and irrigation systems, playing surfaces and the fixtures and appurtenances to the Yakima Sports Complex as and when needed to preserve them in "first class" condition and repair (less normal wear from use) throughout the full term of the Lease. SOZO shall further keep in repair and maintain as necessary all machinery, equipment and facilities necessary for the playing of sports and the comfort of players. SOZO shall paint the exterior of the buildings on the Yakima Sports Park (except the metal) with such frequency as may be required to maintain their good, clean appearance. All such repairs, restorations, and replacements shall be performed and provided in quality and workmanship at least equal to the original work or installations. If SOZO fails to make such repairs, restorations, or replacements to equipment, improvements or buildings on the Yakima Sports Park within ninety (90) days of written notice by City, City may, but shall not be obligated to, make them at the expense of SOZO and such expense will be paid by SOZO within fifteen (15) days after delivery of a statement for such expense. Agreement Between City of Yakima and -7- SOZO Sports of Central Washington 4.12.2 Sidewalk Maintenance. At its sole cost and expense, SOZO shall maintain any sidewalks on the Yakima Sports Complex in good and presentable condition during the full term of this Agreement, shall be responsible for correcting any unsafe sidewalk conditions and shall be responsible for the removal of ice and snow from the sidewalks. 4.12.3 Janitorial Services. At its sole cost and expense, SOZO shall keep the Yakima Sports Complex clean, and shall provide sufficient janitorial services to maintain a tidy appearance on and about the Yakima Sports Complex. SOZO shall provide landscaping maintenance services, lawn and turf care, mowing, fertilizing, irrigation, aeration, sweeping, cleaning, field and parking lot cleanup, trash and litter collection, portable sanitation cleanup when and as required, such that landscaping on the Yakima Sports Complex remains healthy, attractive, clean and well maintained. 4.12.4 Repair of Damage. In the event any material damage shall occur to the Yakima Sports Park of any kind or nature whatsoever, SOZO shall promptly cause said damage to be fully repaired or replaced, as is necessary, at SOZO's own cost and expense. In the event SOZO fails to accomplish such repair or replacement within forty-five (45) days of receipt of written notice by the City, then in that event City may, but is not required to, enter the Yakima Sports Park and accomplish such repairs and thereafter bill SOZO who will pay the bill within fifteen (15) days after City sends an invoice for such expense. 4.12.5 Improvements. SOZO shall be solely responsible for providing adequate funding for any alterations or improvements to the Yakima Sports Complex as provided in this Agreement and such alterations or improvements shall be made without cost to the City, except as provided in Section 5.2, 5.3 and 5.10. All alterations and/or improvements made upon the Yakima Sports Complex shall be subject to compliance with all required permits, inspections and codes applicable to the actions performed and shall be accomplished in accordance with generally accepted construction methods and means. 4.12.6 Alterations of Premises After Construction. After such time as the Yakima Sports Park has been completed and accepted as defined above, SOZO shall not make any material alteration to the Yakima Sports Park, including any changes to the landscaping, without the City's prior written consent, such consent to not be unreasonably withheld or delayed. For purposes of this subsection, a "material alteration" shall be deemed alterations not to exceed the cost to SOZO of $20,000 in any calendar year, adjusted annually on each Lease commencement date to a sum equivalent to one hundred five percent (105%) of the sum of the previous year's monetary limit. Agreement Between City of Yakima and -8- SOZO Sports of Central Washington 4.13 Signs. SOZO may place and maintain signs upon the Premises in accordance with the City sign ordinance. 4.14 Utilities. 4.14.1 Utility Services and Expense. Except as otherwise provided in this Agreement or in the Lease, SOZO will pay for all domestic and irrigation water, gas, garbage, sewage, electricity, telephone, and other utilities and communications services used by SOZO on the Yakima Sports Complex, whether or not such services are billed directly to SOZO. SOZO will also procure, or cause to be procured, without cost to the City, any and all necessary permits, licenses, or other authorizations required for the lawful and proper installation and maintenance upon the Yakima Sports Complex of utility appurtenances and appliances for use in supplying such utilities and services to and upon the Yakima Sports Complex. The City, upon request of SOZO, and at the sole expense and liability of SOZO, will join with SOZO in any application required for obtaining or continuing any such services, provided that such services do not violate any other applicable provision of this Agreement. The City shall not be held liable for any injury, loss, or damage caused by or resulting from any interruption or failure of utility services due to any cause whatsoever, unless such interruption or failure is the result of the City's negligence. SOZO shall not be entitled to any offset, reduction, or return of consideration as a result of any interruption or failure of services. 4.14.2 Trash & Garbage. SOZO shall place all trash and garbage from the Yakima Sports Complex into such areas and containers as are designed and intended to accommodate the trash and garbage generated within or on the Yakima Sports Complex. SOZO shall not allow trash and/or garbage to accumulate such that a nuisance or health hazard results or attract wildlife that could cause potential hazards to aircraft operations at the Yakima Air Terminal. 4.15 Hazardous Substances. 4.15.1 Definition. As used herein, the term "Hazardous Substance" means any hazardous, toxic or dangerous substance, waste, or material, which is or becomes regulated under any federal, state, or local statute, ordinance, rule, regulation, or other law now or hereafter in affect pertaining to environmental protection, contamination, or cleanup. Agreement Between City of Yakima and -9- SOZO Sports of Central Washington 4.15.2 Access to Environmental Information. SOZO shall keep upon the Yakima Sports Complex, in a location accessible to City on request during normal business hours, copies of all reports regarding hazardous or toxic materials in or upon the Yakima Sports Complex that SOZO has provided to any governmental agency in the previous quarter. SOZO shall, upon request by City and at SOZO's expense, provide City with a copy of any such report. In the event of any accident, spill, or other incident involving hazardous or toxic matter that SOZO is required to report to any governmental agency, SOZO shall immediately report the same to the City and supply City with all information and reports with respect to the same, together with SOZO's clean-up or remediation plan and schedule. If such clean-up or remediation plan is not acceptable to City in City's discretion, City may so notify SOZO and, upon 48 hours prior written notice (or without notice if so required by an emergency) may enter on the Yakima Sports Park to conduct the cleanup or remediation and charge SOZO the cost thereof. All information described herein shall be provided to City regardless of any claim by SOZO that it is confidential or privileged, provided that the City shall not publish or disclose the information to any third party except as pursuant to Chapter 42.56 RCW. 4.15.3 Environmental Indemnification. SOZO agrees to hold harmless, protect, indemnify, and defend City from and against any damage, loss, claim, or liability, including reasonable attorney's fees and costs, resulting from SOZO's use, disbursement, disposal, transportation, generation, and/or sale of any Hazardous Substances. The City agrees to hold harmless, protect, indemnify, and defend SOZO from and against any damage, loss, claim, or liability, including reasonable attorney's fees and costs, resulting from (a) Hazardous Substances existing on the Yakima Sports Park as of the Effective Date of the Lease; or (b) Hazardous Substances thereafter used, disposed of, or generated on the Yakima Sports Complex by the City. These indemnities will survive the termination of this Agreement, whether by expiration of the Term or otherwise. 4.16 Risk of Loss. All SOZO's personal property of any kind or description whatsoever on the Yakima Sports Complex shall be at SOZO's sole risk, and City shall not be liable for any damage done to, or loss of, such personal property. ARTICLE 5 CITY OBLIGATIONS 5.1 Agreement. City agrees to the terms and conditions of this Agreement and shall assist in the annexation of property subject to this Agreement in serving a municipal purpose, as is authorized under State law. Agreement Between City of Yakima and -10- SOZO Sports of Central Washington 5.2 Off -Premises Street Access, Parking and Stormwater. 5.2.1 The City will maintain all existing public access areas serving the Yakima Sports Complex that are not part of the Yakima Sports Complex, including, but not limited to, stormwater retention facilities, consistent with such standards applicable to municipal parks owned and operated by the City. 5.2.2 The City will maintain all streets and parking areas that are not part of the Yakima Sports Complex property, including landscaping associated therewith, located adjacent to or providing access to and egress from the Yakima Sports Complex, consistent with applicable City standards. 5.2.3 The City will extend to exterior boundary lines of the Yakima Sports Complex such utility services, roads, sidewalks, gutters and lighting as are reasonably necessary to gain approval for zoning modification and/or development of the Yakima Sports Complex, or to operate the Yakima Sports Complex, as part of City's Investment set forth in Section 5.10. 5.3 Naming Rights — Signs — Zoning. 5.3.1 The City grants to SOZO all rights to Yakima Sports Park naming and advertising, including the naming of the complete Complex, which shall be coordinated by SOZO as part of the property acquisition with real property funders/lenders/donors. Provided, however, the reference "Yakima," "City of Yakima", or other reference to "Yakima" as approved by the City shall be incorporated into names and signage when reasonably feasible. 5.3.2 The City agrees to cooperate with SOZO to modify the zoning code to facilitate the development of any portion of the Yakima Sports Complex not otherwise permitted outright under the zoning code, and Parties agree that if the full intent of this Agreement cannot be achieved absent such zoning modifications, then either Party may terminate this Agreement prior to entry into the Lease 5.3.3 The City will install directional signage to the Yakima Sports Complex as appropriate in various locations throughout the City. 5.4 Liquor License. The City will support SOZO obtaining a liquor license for the SOZO Sports Campus through the established City approval process. 5.5 Public Safety. The City will provide police and fire services to the Yakima Sports Complex consistent with applicable City standards. Agreement Between City of Yakima and -11- SOZO Sports of Central Washington 5.6 Permitting. The City will make its best effort to expedite all permits, licenses and other municipal approvals required for completion and operation of the Yakima Sports Complex. 5.7 City Liaison. The City will provide a dedicated contact person and liaison with SOZO for all permit and license applications, changes, and variances to complete the Yakima Sports Complex in an expedited manner. 5.8 Promotion. The City will use its best efforts to promote and support the Yakima Sports Complex within the business community for the benefit of the Parties and the enhanced recreational use of the resources. 5.9 Fees and Charges. City grants and authorizes SOZO to establish and collect rents, fees and charges, and to retain all revenues, including special event/tournament parking revenues, associated with the use of Yakima Sports Complex. SOZO shall make reasonable efforts to balance admission fees for events within the Yakima Sports Park open to the public to represent (1) the cost of the event or activity, (2) the generation of revenue and (3) the regulation of Yakima Sports Park use, with the primary goal to maintain Yakima Sports Park use fees at a cost affordable to the public. 5.10 Investment. The City will provide Four Million One Hundred Thousand Dollars ($4,100,000) in capital expenditures toward the acquisition of property for and the development of the Yakima Sports Park as soccer fields and parking lots, as its part in development of the Yakima Sports Park, to include, but not be limited to, extension of sewer, water and other utilities to the Yakima Sports Park, construction of sidewalks, gutters and installation of lighting and on-site traffic control, if deemed reasonably necessary. Except as specifically stated hereinabove, City resources shall not be used for the acquisition of land for, or the design or development of the SOZO Sports Campus or for the structures and assets associated with the soccer building located on the SOZO Sports Campus parcel owned by or leased to SOZO upon which the soccer buildings and associated structures are located. ARTICLE 6 DESIGN AND CONSTRUCTION OF PREMISES Agreement Between City of Yakima and -12- SOZO Sports of Central Washington 6.1 Design. 6.1.1 SOZO shall retain a Washington State licensed architect or professional engineer to design the Yakima Sports Complex and associated exterior landscaping which shall visually blend with the setting. The City shall have the right to approve the final design of the Yakima Sports Park, which shall be consistent with established City zoning and/or design code. 6.1.2 Where required by applicable provisions of law, SOZO shall comply with the Americans with Disabilities Act of 1990 (ADA) in the design, construction, and operation of the Yakima Sports Complex. 6.2 Building and Site Plans. SOZO shall retain a Washington State licensed architect or professional engineer, registered in the State of Washington, to prepare building and site plans for the Yakima Sports Complex, which shall depict and describe the structures, utilities, and landscape plan. The City shall have the right to approve the final building and site plans comprising the Yakima Sports Park, such approvals to not be unreasonably withheld. 6.3 Construction/Site Work/Fencing. SOZO shall be solely responsible for all development and construction of the Yakima Sports Complex and shall be responsible for the site work, all required permits and grading. SOZO shall properly barricade the work area and install signage restricting unauthorized persons from entering onto the building site during any phase of development or construction. Unless otherwise specifically agreed by the City in writing, fencing shall be placed around the entire work area during construction. In addition, the building site shall be kept in a clean and organized condition during development periods. SOZO shall be responsible for site security, traffic and pedestrian signage, warnings and control at the site during the development and construction phases. 6.4 Construction Deadlines. 6.4.1 SOZO shall be required to commence development of the Premises within (6) months of the Effective Date of the Lease. Commencement of development of the Yakima Sports Complex is defined as that date upon which SOZO files its first application for a project permit, as defined in RCW 36.70(a).020(4). 6.4.2 SOZO shall be required to complete the development and construction of the Yakima Sports Park within one (1) year of the Effective Date of the Lease and thereafter proceed with due diligence to complete the remainder of the Yakima Sports Complex construction and development as described herein. Completion of the development and construction of the Yakima Sports Complex is defined as that date upon which all final occupancy permits are obtained by SOZO for all structures on the Yakima Sports Complex. Agreement Between City of Yakima and -13- SOZO Sports of Central Washington 6.4.3 SOZO may phase construction of improvements to those portions of the Yakima Sports Complex not comprising the Yakima Sports Park. 6.5 Failure to Meet Construction Deadlines/Time of Essence. 6.5.1 Except as provided in Section 6.4.3 or 9.15 herein, it is mutually understood and agreed that failure by SOZO to meet the development and construction deadlines shall constitute a material breach of the Lease and this Agreement by SOZO, in which event the City, at its option, can terminate the Lease and this Agreement for cause pursuant to Article 8. Time is of the essence with this Agreement. 6.5.2 Notwithstanding Section 6.4 and 6.5.1, SOZO's obligation to commence construction shall not begin until the City has issued building permit(s) for the Yakima Sports Complex. 6.6 Stormwater Drainage, Sewer and Water Lines. SOZO will be responsible for installing all required storm drains, stormwater facilities, sewers, water and irrigation lines from exterior boundary lines of the Yakima Sports Complex to all required use points within the Yakima Sports Complex, as required to complete development and construction of the Yakima Sports Complex. 6.7 Development and Construction Fees and Expenses. 6.7.1 SOZO shall be responsible for obtaining and paying for necessary permits, fees and expenses associated with the development and construction of the Yakima Sports Complex. In addition, SOZO shall be responsible for any additional costs for inspections billed to the City by any government agency, including not limited to the City of Yakima, Yakima County, or the State of Washington. 6.7.2 Notwithstanding Section 6.7.1, SOZO shall not be obligated to pay permit fees, City utility connection charges (if any) and expense, including any transportation impact or environmental mitigation fees, in an aggregate amount in excess of One Hundred Thousand Dollars ($100,000.00), excluding utility meter fees, to any portion of the Yakima Sports Complex. City shall be responsible for any such fees in excess of the amount set forth in this Section 6.7.2. 6.8 Partial Public Works Project. 6.8.1 The development and construction of that portion of the Yakima Sports Complex constructed on the City owned property shall be constructed as a public works project requiring the payment of prevailing wages. SOZO is the developer and the City is an investing partner in the cost of construction of that portion of the Yakima Sports Complex constructed on the City owned property. The City shall be involved with and shall have responsibility for the bidding and contracting processes for the public work portion of the Yakima Sports Complex. With respect to the construction of that portion of the Yakima Sports Complex constructed on SOZO's Agreement Between City of Yakima and -14- SOZO Sports of Central Washington property the City shall have no financial or other interest in the cost of property acquisition, design, construction or development thereon. The portion of the acquisition, design and development occurring on SOZO's property shall not be considered a public work and SOZO shall not be required to follow public works bidding requirements or to pay prevailing wages, nor will SOZO be obligated to pay or to contract for prevailing wages or any other standard of payment controls associated with this privately owned portion of the project. This provision is a material part of the consideration for this Agreement. 6.8.2 The project signage and all literature and advertising by either the City or SOZO shall not indicate in any manner that the development of the privately owned property is a City project, is subject to a City public work contract, or any other such misleading statement indicating that this private property development portion of the project is a public work project, either directly or indirectly. 6.9 No Liens. Except liens and encumbrances of any lender pursuant to Article 6 herein, it is mutually understood and agreed that SOZO shall have no authority, express or implied, to create or place any lien or encumbrance of any kind or nature whatsoever upon, or in any manner to bind, the interest of the City in the fee interest in the Yakima Sports Park, or to charge the rentals payable hereunder for any claim in favor of any person dealing with SOZO, including those who may furnish materials or perform labor for any construction or repairs, and each such claim shall affect and each such lien shall attach to, if at all, only the right and interest granted to SOZO by this Agreement. If any such liens are filed, City may, without waiving its rights and remedies for breach, and without releasing SOZO from its obligations hereunder, require SOZO to post security in form and amount reasonably satisfactory to City or cause such liens to be released by any means City deems proper, including payment in satisfaction of the claim giving rise to the lien. SOZO shall pay to City, upon demand, any sum paid by City to remove the liens. Further, SOZO agrees that it will save and hold the City harmless from any and all actual costs or expenses based on or arising out of the asserted claims or liens, except those of the lender, against this Agreement or against the right, title, and interest of the City in the City owned portion of the Yakima Sports Park or under the terms of this Agreement, including reasonable attorney's fees and costs incurred by City in removing such liens, and in enforcing this paragraph. Additionally, it is mutually understood and agreed that this paragraph is intended to be a continuing provision applicable to future repairs and improvements after the initial construction phase. 6.10 Insurance and Indemnification Requirements During Construction. 6.10.1 Indemnification/Hold Harmless SOZO shall require its construction contractors and subcontractors to defend, indemnify and hold the City, its officers, elected officials, employees and volunteers harmless from any and all claims, injuries, damages, losses or suits, including reasonable attorney fees, arising out of or in Agreement Between City of Yakima and -15- SOZO Sports of Central Washington connection with the performance of this Agreement, except for injuries and damages caused by the sole negligence of the City. 6.10.2 Commercial General Liability Insurance SOZO shall require its construction contractors to procure and maintain, for the duration of construction of the Yakima Sports Complex, commercial general liability insurance against claims for injuries to persons or damage to property, which may arise from or in connection with the performance of the work hereunder by the construction contractors and subcontractors, their agents, representatives, employees or subcontractors. All said policies shall name the City of Yakima, its elected officials, officers, agents, employees, and volunteers as additional named insureds and shall include a provision prohibiting cancellation or reduction in the amount of said policies except upon thirty (30) days prior written notice to the City. SOZO shall require its construction contractors to maintain minimum commercial general liability insurance limits of no less than $2,000,000 each occurrence, $2,000,000 general aggregate and a $2,000,000 products -completed operations aggregate limit. 6.10.3 Builders Risk Insurance. SOZO shall require its construction contractors to procure and maintain, for the duration of construction of the Yakima Sports Complex, Builders Risk insurance covering interests of the City and the constructions contractor in the work. Builders Risk Insurance shall be on all-risk policy form and shall insure against the perils of fire and extended coverage and physical loss or damage including flood, theft, vandalism, malicious mischief, collapse, temporary buildings and debris removal. The Builders Risk insurance covering the work will have a maximum deductible of Five Thousand Dollars ($5,000) for each occurrence, payment of which will be the responsibility of the construction contractor. Higher deductibles for flood perils may be accepted by the City upon written request by SOZO and written acceptance of the specific terms by the City. Any increased deductibles accepted by the City that are in excess of the Five Thousand Dollars ($5,000) maximum deductible will remain the responsibility of the construction contractor. The Builders Risk insurance shall be maintained until final acceptance of the work by SOZO. SOZO shall require its construction contractors to maintain Builders Risk insurance in the amount of the completed value of the project, with no coinsurance provisions. 6.10.4 Subcontractors. SOZO shall require its construction contractors to include all subcontractors as insureds under its policies or shall furnish separate certificate and endorsements for each subcontractor. All coverage for subcontractors shall be subject to all of the same insurance requirements as stated herein for the construction contractor. 6.10.5 Verification of Coverage. SOZO shall furnish the City with original certificates and a copy of the amendatory endorsements, including, but not necessarily limited to, the additional insured endorsement, Agreement Between City of Yakima and -16- SOZO Sports of Central Washington evidencing the Commercial General Liability insurance of the construction contractor before commencement of the work. Before any exposure to loss may occur, SOZO shall file with the City a copy of the Builders Risk insurance policy that includes all applicable conditions, exclusions, definitions, terms and endorsements related to this project. ARTICLE 7 FINANCING AND SECURITY INTERESTS 7.1 Financing — City Obligation. City shall share in the financing of construction improvements carried out upon, to, or with respect to all portions of the Yakima Sports Park, excluding any and all improvements upon SOZO's property, up to the total amount not to exceed Four Million One Hundred Thousand Dollars ($4,100,000). Costs of improvements to the Yakima Sports Complex beyond the City's "not to exceed" value set forth above shall be solely SOZO's responsibility for all financing requirements for all property acquisition, project design, property development, construction, maintenance, repairs, or subsequent improvements to the Yakima Sports Complex. The City shall be under no obligation directly or indirectly to pay for any labor, material, or improvement associated with the Yakima Sports Complex except as provided herein or mutually agreed upon in writing hereafter. SOZO shall, when applying for and obtaining financing, inform any lender that the City has no financial obligations associated with the construction, maintenance, repairs or subsequent improvements to the City owned portion of the Yakima Sports Complex beyond what is provided herein, and the City shall have no responsibility or participation obligation whatsoever in the development or construction of the privately owned SOZO property that is part of the overall Yakima Sports Complex. 7.2 Mortgages — Generally. SOZO, and its successors and assigns, shall have the unrestricted right to mortgage its interests under this Agreement and the Lease, subject, however, to the limitations set forth herein. As used herein, "Leasehold Mortgage" shall include any such mortgage(s) or deed(s) of trust on the Estate to be created by this Agreement; "Purchase Money Mortgage" shall include any Mortgage granted to SOZO (or SOZO's successors) in connection with the sale of the interest in this Agreement and/or the Lease; and "Estate" shall mean the estate of SOZO created by this Agreement and the Lease upon and subject to all the terms and conditions of this Agreement and the Lease. Any such Mortgage shall be subject to the rights of City hereunder in accordance with all the terms and conditions of this Agreement and the Lease. In no circumstances and under no condition shall City's fee interest in the Yakima Sports Park be encumbered by, subject to or subordinate to a Mortgage. 7.3 Security Interest in Premises and Agreement/Consent. Subject to the terms set forth in Section 7.2 the City consents to the grant, transfer, pledge and assignment of any and all right, title, claim or interest of SOZO in and to this Agreement and in the Lease, and in any SOZO building facility, personal property and fixtures in the Yakima Agreement Between City of Yakima and -17- SOZO Sports of Central Washington Sports Park ("Collateral") to lender for financing purposes. The City shall recognize lender's first priority security interest in the SOZO Collateral and the City hereby subordinates any and all interest of the City in said SOZO-owned Collateral to lender. SOZO acknowledges that the City will not grant any security interest to any lender in any City property nor will the City allow any encumbrance of any kind or nature whatsoever upon, or in any manner on its title to any City property. In the event of default by SOZO to lender, in addition to all its rights and remedies available at law and equity, lender may enforce and/or foreclose its security interest/interests in the Collateral. City agrees that in connection with any such default, and all without further consent of City, lender may: 7.3.1 Acquire SOZO's interest in the Collateral either by a deed in lieu of foreclosure or actual foreclosure; 7.3.2 Rent and/or grant a ground lease of the Yakima Sports Park subject to this Agreement pending foreclosure of the Collateral by lender; 7.3.3 Assign, sell and/or transfer the Collateral in whole or in part to any person or entity; 7.3.4 Take possession of any or all of the Collateral, obtain right of substitution for SOZO and operate said Collateral; and/or 7.3.5 Appoint a receiver. 7.4 Lender's Reliance on Term. The City acknowledges that SOZO, in making application for financing, may be required to have an assurance that the terms of this Agreement will extend beyond the term of the financing term. By its signature to this Agreement, the City confirms its authority to provide the forty (40) year Lease term conditioned solely upon SOZO maintaining current payments and remaining in full compliance with the terms and conditions of this Agreement and the Lease. Additionally, the City acknowledges that, after any original financial commitments by SOZO have been satisfied, these financing provisions shall be applicable to all future advances or financing required by SOZO and used for the improvements and repairs of the Yakima Sports Complex. 7.5 Surrender of the Collateral. No surrender of Collateral or the Yakima Sports Complex subject to this Agreement or any other act of SOZO shall be deemed to terminate this Agreement. City will not terminate this Agreement voluntarily by agreement with SOZO unless lender has been previously notified in writing and has consented to the termination in writing. This Agreement shall not be amended or modified unless lender has been previously notified in writing and has consented to such amendment or modification in writing. 7.6 Notice of Default and Lender's Rights. Agreement Between City of Yakima and -18- SOZO Sports of Central Washington 7.6.1 Notice of Default. If SOZO materially defaults under this Agreement or the Lease, or if any event occurs which would give City the right to terminate, modify, amend or shorten the term of this Agreement or the Lease, City shall take no steps to exercise any right it may have under this Agreement without first giving lender written notice of such default in accordance with Article 7.12 below. A copy of each and every written notice of default served or sent by City or its agent to or upon SOZO pursuant to this Agreement shall be sent contemporaneously to lender in accordance with Article 7.12 below. Such notice of default shall specify the event or events of default then outstanding and the time period at the end of which the indicated action would become effective. 7.6.2 Termination for Monetary Default. If the written notice of default given by City to lender relates to a monetary default and SOZO has not cured such monetary default within thirty (30) days after lender receives the notice and SOZO's failure to cure results in City desiring to terminate this Agreement or the Lease, City may terminate this Agreement and the Lease if such monetary default is not cured by either SOZO or lender within forty-five (45) days after lender receives the notice of default. 7.6.3 Termination for Non -Monetary Default. If the written notice of default given by City to lender relates to a non -monetary default and SOZO has not cured or diligently pursued curing such non -monetary default within thirty (30) days after lender receives the notice, City shall take no action to terminate this Agreement and/or the Lease if: a. Within sixty (60) days after City's notice to lender regarding SOZO's failure to cure (or failure to diligently pursue a cure) lender notifies City of its intent to realize upon its security interest and commences realization within sixty (60) days thereafter, and diligently pursues realization; and b. Lender pays City at time of notification all monies or performances due that may be in default up to the day lender notifies City of lender's intent and further pays or performs all consideration that accrues during the period after lender so notifies City and completes such other performances that may be required or that come due under this Agreement. City shall not terminate this Agreement nor the Lease because of SOZO's breach of any terms of this Agreement or the Lease relating to the solvency of SOZO or the institution of any bankruptcy, insolvency, receivership or related action by or against SOZO as long as lender cures any default under this Agreement by SOZO as provided herein, except that lender shall not be required to cure any defaults relating to solvency of SOZO. Agreement Between City of Yakima and -19- SOZO Sports of Central Washington 7.7. Right to Assign. Lender shall have the right to assign its interest in the Collateral. Upon the purchaser's, assignee's or transferee's assumption and agreement to perform and be bound by all of the terms of this Agreement and the Lease, lender shall be relieved from further liability under this Agreement and the Lease. If a lender finances the purchaser, assignee or transferee, said lender shall be subject to all obligations as set forth in this Agreement and the Lease. 7.8 Disposition of Insurance. Should the Collateral suffer any loss which is covered by casualty insurance, and the insurance proceeds are used to restore any improvements made by SOZO, City agrees that SOZO and lender shall have the right to such proceeds so long as none of the City's property, utilities or other services therein are damaged or all such damages are repaired to City's reasonable satisfaction. In the event the City's land is substantially damaged and SOZO' s improvements have been repaired, City shall only participate in the insurance proceeds to the extent necessary to repair and restore City's land and any of the City's improvements on or in the ground to the same condition as existed at the time of the casualty. Other than as described herein, City shall have no claim to insurance proceeds that are attributable to SOZO's interest in the Collateral. 7.9 Right to Participate in Litigation. Lender shall have the right to participate in any litigation, arbitration or dispute directly affecting the Collateral or interest of SOZO or lender therein, including, without limitation, any suit, action, arbitration proceeding, condemnation proceeding or insurance claim. City, upon instituting or receiving notice of any such litigation, arbitration or dispute will promptly notify lender of the same. 7.10 Right to Remove Collateral. In the event lender exercises its rights under its Collateral, as provided in this Agreement, and realizes upon the Collateral, City agrees that lender is entitled to remove the Collateral, including but not limited to building facility, furniture, movable trade fixtures and equipment, from the Yakima Sports Complex at any reasonable time and that the Collateral shall remain personal property even though the trade fixtures may be affixed to or placed upon the Yakima Sports Park. In the event lender so realizes on its Collateral, City waives any right, title, claim, lien or interest in the Collateral. 7.12 Notices. All notices, copies of notices, demands, consents or other communications to lender given under this Agreement to lender must be in writing and shall be effective when received by personal delivery or as of the third business day after mailing by United States mail, postage prepaid, return receipt requested, or upon the next business day if delivered by Federal Express or similar next business -day delivery system. Such communications shall be given to an officer of lender Agreement Between City of Yakima and -20- SOZO Sports of Central Washington in a manner recognized by law as legal notification, addressed to lender at an address as provided by lender. ARTICLE 8 TERMINATION 8.1 Obligation to Perform. Nothing herein shall imply any duty upon City to do any work, which under any provision of this Agreement SOZO may be required to perform, and the performance thereof by City shall not constitute a waiver or SOZO's default in performance of the terms of this Agreement. 8.1.2 Payments to Other Parties. Except as otherwise expressly provided hereunder, all obligations of SOZO under this Agreement or the Lease will be performed by SOZO at SOZO's sole cost and expense. If SOZO fails to pay any sum of money owed to any party other than City for which SOZO is liable hereunder, or if SOZO fails to perform any other act on its part to be performed hereunder, and such failure continues for ten days after written notice thereof by City, City may, without waiving or releasing SOZO from its obligations, make any such payment or perform any such other act to be made or performed by SOZO. SOZO shall pay City, on demand, all sums so paid by City and all necessary incidental costs, together with interest accruing thereon at the lesser of one percent (1%) per month, or the maximum rate permissible by law from the date of such payment by City. 8.2 Default. 8.2.1 City's Default. City will not be in default unless City fails to perform an obligation required under this Agreement or the Lease within sixty (60) days after notice by SOZO, which notice must specify the alleged breach; provided that if the nature of City's obligation is such that more than sixty (60) days are reasonably required for cure, then City will not be in default if City commences to cure within sixty (60) days of SOZO's notice and thereafter diligently pursues completion and completes performance within a reasonable time. 8.2.2 SOZO's Default. The occurrence of any one or more of the following events constitutes a default under this Agreement and the Lease by SOZO: (1) SOZO shall be in default of the performance of any covenants, conditions, or provisions of this Agreement, other than the covenants for the payment of consideration required by this Agreement or the Lease, where such failure continues for a period of sixty (60) days after written notice by City provided that if the nature of SOZO's obligations is such that more than sixty (60) days are reasonably required for cure, SOZO will not be in default if SOZO commences to cure within sixty (60) days of City's notice and Agreement Between City of Yakima and -21- SOZO Sports of Central Washington thereafter diligently pursues completion and completes performance within a reasonable time; or (2) SOZO shall be adjudged a bankrupt, make a general assignment for the benefit of creditors, or take the benefit of any insolvency act, or if a permanent receiver and trustee in bankruptcy shall be appointed for SOZO's estate and such appointment is not vacated within sixty (60) days; or (3) SOZO Sports Campus becomes vacant or deserted for a period of sixty (60) days; or (4) if this Agreement or the Lease shall be assigned, or any portion of the Yakima Sports Complex be sublet other than in accordance with the terms of this Agreement or the Lease and such default is not cured within thirty (30) days after written notice to SOZO; or (5) SOZO shall fail to make any payment when due, or fail to make any other payment required hereunder or by the Lease when due, when that failure is not cured within thirty (30) days after mailing written notice thereof by City. 8.2.3 Default for Other Cause. This Agreement and the Lease may be immediately terminated for other cause by a party if the other party substantially fails to perform its obligations under this Agreement or the Lease, through no fault of the terminating party, and the non-performing party does not commence correction of the failure of performance within sixty (60) days of the terminating party's sending notice of the default to the non-performing party. 8.3 Remedies are Cumulative. Remedies under this Agreement and the Lease are cumulative; the failure to exercise on any occasion any right provided by this Agreement or the Lease shall not operate to forfeit such remedy or right. 8.4 Destruction of Premises and Use of Insurance Proceeds. 8.4.1 Unless otherwise mutually agreed by the Parties, in the event the Yakima Sports Complex is destroyed or damaged by fire or other casualty, then SOZO shall proceed to rebuild and restore the Yakima Sports Complex, or such part thereof as may be damaged as aforesaid. In the event of any loss covered by the insurance policies described and required pursuant to Article 9.5.1 herein, and unless this Agreement or the Lease shall be terminated as a result of said loss, as provided herein, then the proceeds of such insurance policies shall be applied by SOZO first to rebuild and restore the Yakima Sports Complex and replace the improvements, fixtures, and equipment, which may be damaged or destroyed by such casualty. 8.4.2 Notwithstanding the forgoing, in the event the Yakima Sports Complex is destroyed by fire or other casualty SOZO may elect to restore the Yakima Sports Complex to a condition equivalent to or better as existed as of the date of the casualty, and terminate the Agreement and Lease without further obligation except as otherwise provided in this Agreement and the Lease. Agreement Between City of Yakima and -22- SOZO Sports of Central Washington 8.5 Duties Upon Termination. Upon termination of this Agreement and the Lease, and unless otherwise arranged in writing by the Parties, SOZO shall remove all its personal property, goods, and effects from the Yakima Sports Park. In the event that SOZO fails to perform this duty at termination, the City may cause such removal to be made and said personal property, goods, and effects to be stored, the actual cost and expense to be paid by SOZO. It is mutually understood and agreed that all improvements to the Yakima Sports Park shall revert to the City at the termination of this Agreement. 8.6 Eminent Domain. The following rules shall govern the rights and duties of the Parties in the event of interference with SOZO's use or possession of SOZO's privately owned portions of the Yakima Sports Complex as a result of the exercise of eminent domain or private purchase in lieu thereof 8.6.1 Rights of Termination. If the whole of SOZO's privately owned portions of the Yakima Sports Complex shall be taken for any public or quasi -public use under any statute or by right of eminent domain, or by private purchase in lieu thereof, then this Agreement and the Lease shall automatically terminate as of the date that title shall be taken. If more than twenty-five percent (25%) of the privately owned portion of the Yakima Sports Complex shall be so taken and if the taking renders the remainder thereof unusable for the purposes for which the Yakima Sports Complex was intended in accord with this Agreement, then City and SOZO shall each have the right to terminate this Agreement and the Lease on thirty (30) days notice to the other given within ninety (90) days after the date of such taking. Provided, however, that if the City is exercising its rights of eminent domain, a fair value shall be placed on this Agreement and SOZO's leasehold interest and the SOZO Sports Campus with the compensation thereof awarded solely to SOZO, or lender pursuant to its security interest, if any. 8.6.2 Non -Termination. If any part of the privately owned portion of the Yakima Sports Complex shall be so taken and this Agreement and Lease are not terminated, then the City shall, at its own cost and expense, restore the remaining portion of the Yakima Sports Complex to the extent necessary to render it reasonably suitable for the purposes for which it was intended in accordance with this Agreement. 8.6.3 Compensation. The compensation awarded or paid upon such a total or partial taking of the privately owned portion of the Yakima Sports Complex and/or this Agreement and the Lease shall belong to and be apportioned between the City and SOZO in accordance with their respective interests under Agreement Between City of Yakima and -23- SOZO Sports of Central Washington this Agreement and the Lease as determined by a court of competent jurisdiction. Additionally, SOZO may prosecute any claim directly against the condemning authority for the costs of removal of the goodwill, stock, trade fixtures, furniture and other personal property belonging to SOZO. City shall have no claim to condemnation proceeds that are attributable to SOZO's interest in the Collateral, including the Lease, nor shall lender have any interest in City's condemnation proceeds, if any. ARTICLE 9 GENERAL CONDITIONS 9.1 Relationship to Parties. 9.1.1 Independent Status. The Parties intend that an independent relationship shall be created by this Agreement and the Lease. Nothing contained herein shall create the relationship of principal and agent or of partnership or of joint venture between the parties hereto, and neither the method of computation of consideration nor any other provision contained herein shall be deemed to create any relationship between the Parties thereto other than the relationship of City as granting a ground lease to SOZO for which the City contributes investment capital for development of soccer playing fields. SOZO has the experience, ability, and resources to develop and operate the Yakima Sports Complex and is performing independent functions and responsibilities within its field of expertise. SOZO, its personnel and agents are independent contractors and not employees of the City. No agent, employee, servant, or representative of SOZO shall be deemed to be an employee, agent, servant or representative of the City. SOZO and its personnel have no authority to bind the City or to control the City's employees. As an independent contractor, SOZO is responsible for its own management. The City's administration and enforcement of this Agreement and the Lease shall not be deemed an exercise of managerial control over SOZO or its personnel. 9.1.2 No Third Party Rights Created. It is mutually understood and agreed that this Agreement and the intended Lease are solely for the benefit of the Parties hereto and gives no right to any other party except as provided by Article 7 herein. 9.2 Notices. Except as otherwise stated in Article 7, any notice required or permitted hereunder must be in writing and will be effective upon the earlier of (1) personal delivery, (2) three days after being mailed by certified mail, postage prepaid, return receipt requested, or (3) upon the next business day if delivered by Federal Express or similar next business day delivery system, addressed to SOZO or to City at the address for that party designated herein. Either party may specify a different address for notice purposes by written notice to the other, except that City may in any Agreement Between City of Yakima and -24- SOZO Sports of Central Washington event use the SOZO Sports Campus as SOZO's address for notice purposes. All notices shall be delivered to the following addresses: TO CITY: TO SOZO: 9.3 Reports and Information. Tony O'Rourke, City Manager City of Yakima 129 North Second Street Yakima, WA 98901 SOZO Sports of Central Washington, Inc. P.O. Box 48299 Yakima, WA 98908 When requested by the City, SOZO shall furnish periodic reports and documents on non - confidential matters covered by this Agreement and the Lease. The reports and documents shall be furnished in the time and form reasonably requested. SOZO shall maintain accounting records in accordance with Generally Accepted Accounting Principles (GAAP) for non-profit entities. 9.4 Permits, Licenses, Taxes and Fees. 9.4.1 Permits, Licenses and Other Documents. SOZO shall possess a current Yakima Business License and shall obtain all regulatory licenses and permits, including all construction and building permits, necessary to fulfill SOZO's obligations under this Agreement and the Lease at SOZO's sole expense. Each party agrees to execute such additional or other documents as may be required to fully implement the intent of this Agreement and the Lease. 9.4.2 Taxes and Fees. As an independent contractor, SOZO shall be solely responsible for its taxes, fees and charges incurred, including but not limited to license fees, business and occupation taxes, workers' compensation and unemployment benefits, its federal, state, regional, county and local taxes and fees, including income taxes, property taxes, permit fees, operating fees, surcharges of any kind that apply to any and all persons, facilities, property, income, equipment, materials, supplies or activities arising from SOZO's property ownership and operations under this Agreement and the Lease. 9.4.3 Leasehold Excise. City shall be responsible for payment of leasehold excise tax, if any, under this Agreement and the Lease. Agreement Between City of Yakima and -25- SOZO Sports of Central Washington 9.4.4 Admissions Tax. The City acknowledges that SOZO, as a non-profit entity, is not subject to the City's admissions tax. In the event the City's admissions tax is made applicable to non-profit entities, including SOZO, all amounts collected and paid by SOZO to City as admissions taxes shall be a credit against (i.e., deducted from) amounts otherwise payable by SOZO to City under this Agreement and the Lease. 9.5 Insurance. 9.5.1 Fire and Casualty Insurance. SOZO agrees that, at all times during the full term of this Agreement and the Lease, SOZO shall, at is sole cost and expense, maintain in full force and effect adequate fire, flood and other casualty coverage covering the Yakima Sports Complex and its contents, including all personal property, fixtures and improvements. Such policy shall include a replacement cost endorsement. SOZO shall obtain and file with the City's Risk Manager a Certificate of Insurance evidencing such coverage. SOZO shall provide the City with a thirty (30) day cancellation notice prior to any policy cancellation. Adequacy of coverage is defined as insurance sufficient to restore the Yakima Sports Complex to its pre -casualty condition. 9.5.2 Liability Insurance During Term of Lease. Prior to the Effective Date of the Lease, SOZO, at its own expense, shall obtain and file with the City's Risk Manager a Certificate of Insurance evidencing commercial general liability insurance coverage ("CGL") providing coverage of at least $2,000,000 per occurrence and $2,000,000 general aggregate. This Certificate of Insurance shall be subject to approval by the City's Risk Manager as to company, terms and coverage and said approval shall not be unreasonably withheld. The CGL shall name the City, its elected officials, officers, agents, employees, and volunteers as additional named insureds and must fully protect the City from any and all claims and risks and losses in connection with any activities or omissions by SOZO by virtue of this Agreement and the Lease. The CGL policy shall remain in full force and effect at SOZO's sole expense for liability for property damage or personal injury that may occur in connection with activities or omissions by SOZO, and provide continuous coverage for the full term of this Agreement and the Lease. SOZO shall insure that the City's Risk Manager is given thirty (30) calendar days prior written notice, by certified mail, of any cancellation, lapse, reduction or modification of such insurance. 9.5.3 Release and Waiver of Subrogation. Any policy of insurance carried by either City or SOZO pursuant to any obligation under this Agreement or the Lease shall, to the extent available, contain a waiver of subrogation clause on the part of the insurer. Such waiver shall apply to damages to adjacent property owned by either Party. Notwithstanding any other provision of this Agreement or the Lease, neither City nor Agreement Between City of Yakima and -26- SOZO Sports of Central Washington SOZO shall be liable to the other party or to any insurance company (by subrogation or otherwise) insuring the other party for an loss or damage to any building, structure or tangible personal property of the other occurring in or about the Yakima Sports Complex, even though such loss or damage might have been occasioned by the negligence of such party, its agents or employees, if such loss or damage is covered by property insurance issued by an insurance carrier authorized or licensed by the Insurance Commissioner of the State of Washington to issue lines of insurance benefiting the party suffering such loss or damage or was required under the terms of this Agreement or the Lease to be covered by insurance by the party covering the loss. 9.6 Hold Harmless, Indemnification, and Industrial Insurance. 9.6.1 Hold Harmless and Indemnification. Each Party hereto agrees to be responsible for and assumes liability for its own wrongful or negligent acts or omissions, or those of its elected officials, officers, agents, volunteers or employees to the fullest extent required by law. Each Party agrees to save, indemnify, defend, or hold the other Party harmless against all liability, loss, damages and expenses, including costs and reasonable attorney's fees, resulting from actions, claims and lawsuits arising or alleged to have arisen in whole or in part, out of or in consequence of the acts or failures to act by the other Party, its elected officials, officers, employees, subcontractors, agents, volunteers or its assigns, which arise in any way out of the performance of this Agreement or the Lease. In the case of negligence of both the City and SOZO, any damages allowed shall be levied in proportion to the percentage of negligence attributable to each party, and each party shall have the right to seek contribution from the other Party in proportion to the percentage of negligence attributable to the other Party. 9.6.2 Industrial Insurance. The Parties have specifically negotiated SOZO's waiver of its immunity under Title 51 RCW, which is hereby waived for purposes of SOZO's indemnification and hold harmless of the City, including the duty to defend. This provision shall be inapplicable to the extent such action, claim, or lawsuit is judicially found to arise solely from the acts or failures to act by the City. 9.7 Successors and Assigns. 9.7.1 The City and SOZO each agree to be bound to the other party in respect to all covenants, agreements, and obligations contained in this Agreement and the Lease. In recognition of SOZO's expertise and experience in soccer facility management, SOZO may not assign its rights under this Agreement nor the Lease without City's prior written consent to said assignment, which consent may be withheld in the City's sole and absolute discretion, specifically recognizing and accepting, nonetheless, the intent of the Parties to permit SOZO to convey a portion of the Bohannon parcel to Cleat City, LLC, and to lease it back after construction of improvements, without need for further consent by the City. Except as provided in Article 7 and Section 9.7.2 herein, neither party shall assign the Agreement in part or as a whole, without the Agreement Between City of Yakima and -27- SOZO Sports of Central Washington written consent of the other. Except as provided in Article 4.8 herein, SOZO shall not sublease any of the Yakima Sports Park, without written notice to and approval from the City. 9.7.2 The City acknowledges that SOZO is authorized under this Agreement and the Lease, without further City approval, to enter into space leases, rental agreements, and/or grant sub - concessions within the Yakima Sports Park for individual facility operations, food and beverage services; athletic equipment operation, sales and service; and similar supporting entities consistent with Section 4.12.1. 9.7.3 When requested, City's approval of a subcontract or sublease shall not be unreasonably withheld or delayed. 9.7.4 In the event of an assignment, subcontracting, or delegation of duties, SOZO shall remain solely responsible for the full and faithful performance of all terms and conditions of SOZO's responsibilities under this Agreement and the Lease; any assignee, subcontractor or other obligor shall also become responsible to the City for the satisfactory performance of the services, facilities, or equipment assumed. The City may condition approval of subcontractors and assignees upon the delivery by the assignee, subcontractor, or other obligor of its covenant to the City to fully and faithfully complete the requirements or responsibility undertaken under this Agreement and/or the Lease. 9.7.5 Notwithstanding the foregoing, provided SOZO is not in default, SOZO may assign its interest in this Agreement and/or the Lease to a parent, affiliate or subsidiary with City's written consent, which consent will not be unreasonably withheld or delayed. Except as otherwise provided herein, all of the covenants, conditions, and provisions of this Agreement are binding upon and inure to the benefit of the Parties and their respective heirs, personal representatives, successors, and assigns. 9.8 Bankruptcy. Except as provided in Article 7 herein, Parties agree that if SOZO is adjudged bankrupt, either voluntarily or involuntarily, then this Agreement and the Lease, at the option of the City may be terminated if the bankruptcy is not timely cured in accordance with Section 8.2.2. 9.9 Compliance with Laws. SOZO, its officers, employees, and agents shall comply with the applicable federal, state, county and local laws, statutes, rules, regulations, and ordinances, in performing its obligations under this Agreement and the Lease. Such compliance shall include abiding by all applicable federal, state and local policies to ensure equal employment opportunity based on ability and fitness to all persons regardless of race, creed, color, national origin, religion, sex, physical handicaps, or age. SOZO shall comply with applicable laws pertaining to employment practices and employee treatment. Conditions of the Federal Occupational Safety and Health Act of 1970 (OSHA), the Washington Industrial Safety and Health Act of 1973 (WISHA), and standards and regulations issued under these Acts must be complied. SOZO agrees to indemnify and hold harmless the Agreement Between City of Yakima and -28- SOZO Sports of Central Washington City from all damages assessed for SOZO's failure to comply with the Acts and Standards issued thereunder. SOZO is also responsible for meeting all pertinent local, state and federal health and environmental regulations and standards applying to any operation in the performance of this Agreement and the Lease. 9.10 Nondiscrimination. Parties shall not discriminate in employment or services to the public on the basis of race, color, national origin, sex, religion, age, marital status or disability, except for employment actions based on bona fide occupational qualification. 9.11 Choice of Law and Venue. This Agreement and the Lease shall be interpreted according to the laws of the State of Washington. Any action necessary to enforce the terms of this Agreement and the Lease or to resolve disputes arising out of this Agreement or the Lease shall be brought in a court of competent jurisdiction in Yakima County, Washington. 9.12 Costs and Attorney's Fees. In any action brought to enforce any provision of this Agreement or the Lease, including actions to recover sums due or for the breach of any covenant or condition of this Agreement or the Lease, or for the restitution of the Yakima Sports Park to the City or eviction of SOZO during the term or after expiration thereof, the substantially prevailing party shall be entitled to recover from the other party all reasonable costs and reasonable attorneys' fee incurred, including the fees of accountants, appraisers, and other professionals, at trial or on appeal, and without resort to suit. 9.13 Modification. This Agreement and/or the Lease may only be modified by written instrument signed by both Parties. 9.14 Change in Law/Renegotiation. The Parties agree that changes in federal, state or local laws or regulations that materially modify the terms and conditions of the Agreement or the Lease and result in a detrimental change in circumstances or a material hardship for either Party in performing this Agreement or the Lease may be the subject of a request by a Party to renegotiate this Agreement or the Lease, or negotiate amendments thereto and the responding Party agrees to renegotiate fairly with the requesting Party. Agreement Between City of Yakima and -29- SOZO Sports of Central Washington 9.15 Force Majeure. Provided that all other requirements of this Agreement and the Lease are met, either Party shall not be deemed to be in default and shall not be liable for failure to perform under this Agreement nor the Lease if that Party's performance is prevented or delayed by acts of God including but not limited to landslides, lightning, forest fires, storms, floods, freezing, earthquakes, volcanic ash, civil disturbances, strikes or labor interference, acts of the public enemy, wars, blockades, public riots, breakage, explosions, accident to machinery, equipment or materials, unavailability of required materials, governmental restraint or other causes, whether of the kind enumerated or otherwise, which are not reasonably within the control of that obligated Party ("Force Majeure"). If as a result of a Force Majeure event, an obligated Party is unable wholly or partially to meet its obligations under this Agreement or the Lease, it shall give the other Party promptly written notice of the Force Majeure event, describing it in reasonable detail. The obligated Party's obligations under this Agreement and/or the Lease shall be suspended, but only with respect to the particular component of obligations affected by the Force Majeure and only for the period during which the Force Majeure exists. 9.16 Waiver. Failure to enforce any provision of this Agreement or the Lease shall not be deemed a waiver of that provision. No waiver of any right or obligation of either party hereto shall be effective unless in writing, specifying such waiver, executed by the Party against whom such waiver is sought to be enforced. Waiver of any right or power arising out of this Agreement or the Lease shall not be deemed waiver of any other right or power. 9.17 Illegal Provisions — Severability. Should any part of this Agreement or the Lease be found void, illegal or unenforceable the offending provision(s) shall be stricken and the balance of the Agreement or the Lease shall remain in full force and effect. 9.18 Article Headings, Gender and Number. Article paragraph headings are not to be construed as binding provisions of this Agreement; they are of the convenience of the Parties only. The masculine, feminine, singular and plural of any word or words shall be deemed to include and refer to the gender and number appropriate in the context. 9.19 Entire Agreement. This Agreement, the intended Lease and their Exhibits constitute the entire agreement between the Parties, and the parties acknowledge that there are no other agreements, written or oral, that have not been set forth in the text of this Agreement. Agreement Between City of Yakima and -30- SOZO Sports of Central Washington 9.20 Counterparts. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 9.21 Recording. Upon the execution of this Agreement the City may cause this Agreement to be recorded with the land use records of Yakima County, Washington. Agreement Between City of Yakima and -31- SOZO Sports of Central Washington IN WITNESS WHEREOF, this Agreement has been entered into between the City of Yakima and SOZO Sports of Central Washington as of this - day of April, 2015. CITY OF YAKIMA A Washington Municipal Corporation By Tony O'R. rke, City Manager Date: APPROVED AS TO FORM: By (L#/' Jeff Cu e f�¢ity Attorney � ATTEST By SOZO SPORTS OF CENTRAL WASHINGTON, INC. A Not -for -Profit Washington Corporation Sonya Claar Te-, City Clerk City Contract No.: .o)S-Ob'i Resolution No.: Exhibit A – Legal Description of Yakima Sports Complex Exhibit B – Preliminary Building and Site Plans Exhibit C – SOZO Sports Campus Agreement Between City of Yakima and -32- SOZO Sports of Central Washington EXHIBIT "A" The East 1/2 of the Southeast 1/4 of the Southwest 1/4 and the Southwest 1/4 of the Southeast 1/4, EXCEPT the East 20 feet thereof for County road, AND EXCEPT the South 20 feet for road, Section 34, Township 13 North, Range 18 East, W.M., situated in the County of Yakima, State of Washington. Order No. 2027403 Commitment Sch A PA7 Page 2 of 2 Old Republic National Title Insurance Company • Yak !ma Sports Complex ;e� ® %o• Yakima Sports Complex SOZOentra�Swashington PORTS March 23, 2015 o Project profile Community Planning Team (YIS,A, YAKIMA kftrVita.p. GUEST PERIM HOME 4-2 �Yakima Sports Complex /)� SOZO SPORTS�� Project profile of central Washington March 23, 2015 Community Planning Team Y1S,A, M YAKIMA V VitaIWare (- �ioYakima Sports Complex SOZO SPORTS Project profile of central Washington March 23, 2015 Community Planning Team (Y1S,A, YAKIMA V VitaIWare •1 '""111111111lic • Z e7r—rnm1.11117 1it. • 1"141 • • 4114*i i rirfs; • • a M. INNIMI MEI NOM. la' ( _):; Yakima Sports Complex Project profile SOZO SPORTS of central washington March 23, 2015 Community Planning Team (4151SA, YAKIMA kly VitalWare 3D m. mrmi 11111 111 AM Vii` Mt= \I INP i MOM 8 Ak \\ I\ mmi MII F FFFFIll F E EEE I E FFFF EEEEE■ FFFF FFFF m m re ro- aro MI\ 1.1MI \\ rrr rrr rim rrr 11214 ra- tor ra nrra 14141,1, 14 ITT o- 14 4 ro- ro- rer rirr rQ uri= I i IP i=ii= i= lire crc a r-r-rr r■ tlki= i= ii- i= r RFL FRf lEf f f FF RRRRRR F FF FFFF LLL f 15 NOR rrr ra ra on - m rErrn thr ry rcr rirrn, r,sthr rrT rTT •• Mon ma rr,rrrrrrr, ••• •• • •• •n • ••• •• • RF INDOOR SPORTS COMPLEX 75,000 SF ••• PPPP Practice Area 16 pqa ra rcr ns rrsmfrr nr .%CCF \\ • p C FM • Irf"r rrs nsr a rer rQ re rc rm rer cm Q • r- r- F 4 r -FFF- F- :a Yakima Sports Complex /)� SOZO SPORTS�� Project profile of central Washington March 23, 2015 Community Planning Team (YIS,A, YAKIMA VitalWare aim 1.11= IEN:goll\vromi-IM =am num it= mum wim ce • • • -1=1= Et bEb uuacccca w • u4 I I ft uktrbbbbb Of tttP EES P P PPP r rcir frrrr• • i CIE fsrm Errii PPP r II Er p spiin, PPP 111 PPPP P PPS PPPPPP P PP • E E iiii PPPP PPP PON ems mcm bbbbb bbL mirth 1* E It= E bttbh bt6E b • hhh INDOOR SPORTS COMPLEX 75,000 SF I • . rrrrr •; y ---I- -• riff- I I -I- • i • • • • •• • • s • 12 m 17 •• • Yakima Sports Complex /)� SOZO SPORTS�� Project profile of central Washington March 23, 2015 Community Planning Team (YIS,A, YAKIMA VitalWare lk ;t( ��;, Yakima Sports Complex SOZO SPORTS Project profile of central Washington March 23, 2015 Community Planning Team t(,4gisn YAKIMA VitalWare 1,300' 1,952 5' PARCEL NUMBER 18133434001 ZONING - M1 58 57 ACRES ADJUSTED LESS SOZO CAMPUS 42 18 ACRES 460' PROPOSED SOZO CAMPUS 16.4 ACRES 1,112 5' 850' 840' PREPARED WITHOUT BENEFIT OF SURVEY OR LEGAL DESCRIPTION SOZO CAMPUS SUBJECT TO PARCEL DEVELOPMENT PROPOSED SITE PLAN SORENSON RD PARTIAL SITE PLAN 20 100 10 50 36TH AVENUE ITEM TITLE: SUBMITTED BY: BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. 13. For Meeting of: April 7, 2015 Resolution authorizing agreement with SOZO Sports of Central Washington for a multi -sport complex Tony O'Rourke, City Manager SUMMARY EXPLANATION: Attached for City Council consideration is a proposed agreement between the City of Yakima and SOZO Sports of Central Washington, a Washington, non-profit corporation, representing the intent to collaborate in the design, development and operation of a world-class Yakima Sports Complex consisting of 19 soccer/multi-sport fields and an indoor sports facility. Resolution: X Other (Specify): Contract: Start Date: Item Budgeted: Funding Sour cefFiscal Impact: Strategic Priority: Insurance Required? No Mail to: Phone: APPROVED FOR SUBMITTAL: Ordinance: Contract Term: 40 Years with two additional 10 year terms End Date: Amount: $4.1 million Economic Development 4,41 City Manager RECOMMENDATION: Staff requests that Council 1. Approve the Agreement with SOZO Sports of Central Washington, 2. Authorize staff to secure financing up to $4.1 million, and 3. Authorize staff to solicit responses to an RFP to identify the economic impact of the proposed facility. ATTACHMENTS: Description Upload Date Type ❑ SOZO Sports Cover Memo 4/2/2015 Cover Memo ❑ SOZO Resolution 4/2/2015 Cover Memo ❑ Facility Comparison 4/2/2015 Cover Memo ❑ SOZO Proposal 4/2/2015 Cover Memo ❑ City and SOZO agreement 4/2/2015 Cover Memo MEMORANDUM To: Honorable Mayor and Members of the Yakima City Council From: Tony O'Rourke, City Manager Date: April 2, 2015 RE: SOZO Soccer Partnership Attached for City Council consideration is a proposed agreement between the City of Yakima and SOZO Sports of Central Washington, a Washington, non-profit corporation, representing the intent to collaborate in the design, development and operation of a world-class Yakima Sports Complex consisting of 19 soccer/multi-sport fields and an indoor sports facility. This proposed agreement will be scheduled for City Council review and consideration April 7, 2015. SOZO Sports of Central Washington is a Yakima based non-profit entity led by Kerry Martin, Dr. Lloyd Butler, Bob McAllister, Jason Bakker, Jenna Stratton and Jen Trammell. They have the experience, ability, and resources to purchase, design, develop, maintain and operate this proposed Sports Complex. The proposed agreement does not constitute or envision a joint venture. Each party has their own independent responsibilities and rights. The principal purpose of this proposed Yakima Sports Complex is to provide our community's youth and adults with recreational opportunities, while also generating a significant economic catalyst for the City of Yakima. Currently the City has 11 soccer fields between Chesterly Park and Perry Technical Institute. For a City of 93,000 people, 11 fields are not sufficient. This proposed facility will address both current and projected recreational field deficiencies. In addition, this Sports Complex will have a profound economic development impact. A 2014 study by Convention, Sports, and Leisure International of six (6) comparable multi-sports/soccer complexes (an average of 18 fields) and similar market size, attracted an average of 500,000 patrons and visitors and generated between $12 and $45 million in economic impact on the local economy. Highlights of the proposed agreement include: TERM The term of this proposed agreement, as well as an associated land lease, would be for 40 years, commencing upon the effective date of the lease. The agreement and lease each provide for two (2) additional ten (10) year terms. SITE The proposed location of the multi -sport park is a 58 acre site located at 38th Avenue, just north of Ahtanum. (See map attached) This site is zoned light industrial and a sports park/complex is a permitted use under a Class 2 Review process. This site has been purchased by SOZO Sports of Central Washington for $2.5 million dollars. Other sites the SOZO group considered included a 70 acre site at 36th and Ahtanum, the 40 acre property that comprises the Yakima Speedway, 50 acres near 64th Avenue and Nob Hill Blvd. and the approximately 60 acres south of the railroad tracks at the Mill Site. Each of these sites were either considerably more expensive to acquire, too small or required substantial environmental restoration and infrastructure investment to be viable. FACILITIES The proposed 19 field Yakima Sports Complex has a projected cost of $11.8 million and will include the following facilities. Sports Park consisting of: • 17 soccer/multi-sport fields o Fourteen (14) FIFA sized grass fields o Three (3) FIFA sized lighted synthetic turf fields • The estimated cost of the Sports Park is $5.4 million of which the City is responsible for $4.1 million. Sports Campus consisting of: o Indoor athletic center • Two (2) indoor synthetic turf soccer fields • Three (3) basketball courts • Baseball batting cages • Concession stand • Pro shop • Locker room facilities • Training rooms • Five (5) office spaces • The estimated cost of the Sports Campus is $6.4 million, all of which SOZO is responsible for. • Parking for at least 1,100 vehicles - $2.00 parking fee charged for weekend and tournament events similar to Ahtanum Youth Park or an annual parking pass for $75.00. SERVICES TO BE PROVIDED BY SOZO • SOZO will serve as the controlling entity responsible for the purchase, design, development, maintenance, and operation of the Sports Complex. • SOZO will be responsible for the complete design, construction, and operation of this 58 -acre sports/soccer campus. • SOZO will raise and invest no less than $4 million in the acquisition, design, development, and operation of the Sports Complex. • SOZO will acquire the 58 -acre Sports Complex site. A purchase and sale agreement has already been executed for $2.5 million. • Upon approval of this agreement, SOZO will seek a municipal annexation into the City of Yakima, primarily for the reason that the City Charter prohibits the City from purchasing property for parks and recreation purposes outside the City boundaries. Accordingly, SOZO has purchased the 58 -acre site and after annexation into the City of Yakima, proposes to sell 42 acres of the site for approximately $1.8 million to the City subject to an independent land appraisal and keep the remaining 16 acres for the development of the Sports Campus by a separate entity identified as Cleat City, LLC. The City proposes to lease back its 42 -acre property to SOZO for 40 years to allow SOZO to operate the entire facility without any City support. The annual cost to maintain 14 turf fields is approximately $100,000. • SOZO will be responsible for paying for the signalization of 38th Avenue and Ahtanum. The projected cost of this improvement is $400,000. • SOZO shall operate the entire sports/soccer campus and impose the necessary fees and charges to ensure its financial sustainability (see proposed rates), as does the City -owned Capitol Theatre and Convention Center. • SOZO will be responsible for obtaining all necessary financing for the development and operation of the Campus and its share of the Sports Park. • SOZO shall be responsible for all necessary building, site and landscape plans, permits, fees, charges, etc. up to a maximum of $100,000. • SOZO shall comply with the Americans with Disabilities Act of 1990 in the design, construction and operation of the Sports Complex. • SOZO shall be required to commence development of the Sports Complex within six (6) months of the effective date of a lease agreement with the City of Yakima. Commencement of the development is defined as the date SOZO files its first application for a project permit. • SOZO shall be required to complete the development and construction of the Sports Park within one (1) year of the effective date and to diligently proceed to complete the entire Sports Complex thereafter. Completion of the Sports Complex is defined as the date upon which all final occupancy permits are obtained by SOZO. • SOZO may phase the construction of improvement on the 16 -acre Cleat City, LLC Campus without compromising the Sports Park development. • Failure by SOZO to meet the development and construction deadlines shall constitute a material breach of the land lease agreement and the City, at its option, can terminate the lease and agreement for cause. • Development and construction of the City owned property shall be completed as a public works project requiring the payment of prevailing wages. The Cleat City, LLC portion of the Sports Complex is not subject to public work project requirements. • SOZO will provide individual and team fee scholarships, grants, and other benefits for underprivileged youth from the City of Yakima and surrounding service area. SOZO's minimum annual contribution toward these scholarships, grants and benefits shall be no less than five percent (5%) of its net revenue derived from the complex operation. • SOZO will provide a dedicated contact person and liaison with the City for all permits and development arrangements. • SOZO shall determine appropriate business hours for the Sports Park based upon commercially reasonable standards. • SOZO is responsible for security of the Sports Complex. • SOZO shall, at its sole cost, clean and maintain the Sports Complex facilities and grounds in a "first-class" condition and repair throughout the full term of the lease. All repairs, restorations, and replacements shall be performed and provided in a quality equal to the original work or installation. Failure to do so within 90 days of written notice by the City, will permit the City to meet these obligations at the expense of SOZO, the cost of which is repayable to the City within 15 days after delivery of an invoice for such expenses. • SOZO shall be in default of this Agreement if it fails to cure any breach within 60 days or has a financial default. • SOZO agrees, at all times during the term of this Agreement, to maintain adequate fire, flood, and casualty insurance coverage covering the campus, and carry commercial general liability insurance of at least $2 million per occurrence, $2 million general aggregate, and name the City of Yakima as an additional insured. • Each party agrees to be responsible for its own wrongdoing and indemnify the other party for any liability, loss, damage, and expense resulting from negligence or failure to act by the other party. • SOZO may not assign its rights under this Agreement or the lease without the prior written consent of the City at its sole and absolute discretion. Should the City consent, all provisions of this Agreement are binding upon the successor. SERVICES AND RESPONSIBILITIES OF THE CITY • The City will provide $4.1 million in capital expenditures toward the acquisition of approximately 42 acres of property for the development of fields, parking spaces, utilities, connections, sidewalks, and lighting. City resources shall not be used for the design or development of the facilities and assets associated with the 16 -acre Cleat City, LLC Campus parcel. • The City shall purchase approximately 42 acres from SOZO for development of the Sports Park portion of the Sports Complex, subject to a land appraisal. The estimated cost of this acquisition is $1.8 million. • The City shall have the right to approve the final design of the Sports Park, consistent with established development and building regulations. • The City shall grant SOZO, by separate agreement, exclusive right to lease 42 acres from the City to develop, construct, and operate a Sports Park. All improvements to the Sports Park shall remain the property of the City at the termination of this Agreement. • The City will improve 38th Avenue between Ahtanum and the Sports Complex. The estimated cost of improving this Yakima County road is $2.5 million. The City proposes to commission an independent economic impact analysis of the Sports Complex to qualify for SIED funding to contribute to the road development costs. • The City will propose closing 36th Avenue and Spring Creek Road to mitigate traffic through the Spring Creek subdivision, reserving access to emergency vehicles only. • The City shall be responsible for the bidding and construction process for the public works development of the 42 acre Sports Park. • The City shall retain the right to enter the Sports Park or Campus at all times to inspect, provide services, and respond to emergencies. • The City agrees to assist SOZO in the annexation of the SOZO property into the City of Yakima as authorized under state law. • The City will maintain streets and parking adjacent to the Sports Park but not part of the campus property. • The City will grant SOZO all rights to the Sports Complex, Sports Park, and Campus naming rights and advertising provided "Yakima" or "City of Yakima" must be referenced and incorporated into the name and signage of the Sports Complex. • The City shall install directional way finding signage to the Sports Park and Campus in various locations throughout the City. • The City shall support SOZO obtaining a liquor license for the Sports Campus. • The City shall provide a dedicated contact person or liaison with SOZO for all permit and license applications. • The City grants and authorizes SOZO to establish and collect all rents, fees, and charges, and to retain all revenues, including tournament parking revenues, associated with the use of the Campus facilities and Sports Park. Fees will be cost affordable to the public. • The City may terminate this Agreement for monetary default by SOZO, and a lender may assign or transfer its interest in SOZO's collateral, subject to all obligations set forth in this Agreement. • The City shall not default unless the City fails to perform on its obligations required under this Agreement. The City has 60 days to cure any alleged breach. SUMMARY Approval of this agreement symbolizes the City's willingness and ability to execute an effective public/private partnership to enhance the recreational and economic development opportunities of the community. The Sports Complex addresses a historical need for soccer and multi -sports resources in Yakima, while the attendance and business activity generated by tournament events shall have a significant impact on the City's hotel, restaurant, and retail businesses. Comparable size sports facilities in similar size markets average 500,000 visitors. (See attachment.) The City's $4.1 million investment will be exceeded by SOZO. The resulting synergy of these investments will have a long term, positive effect on the recreational and economic future of the City. To finance the City's share of this project, staff recommends securing $4.1 million in long-term debt secured by general fund revenues. Funds to support the debt service of this $4.1 million issue are included in the 2015 budget and Five -Year Financial Plan. This debt will not result in any property tax or fee increases. This agreement would not have materialized without the City Council's leadership and commitment to recreational needs, public support of Proposition 1 in November 2014, and the leadership of SOZO, as well as, City Attorney Jeff Cutter, Public Works Director Scott Schafer, and Community Development Director Joan Davenport. More than anything, this Agreement represents the vision, leadership, and teamwork of the City Council, staff and SOZO to secure a recreational and economic development crown jewel for the City of Yakima's quality of life and future economic prosperity. RECOMMENDATION 1. Approve and execute an Agreement with SOZO to design, develop, and operate a world-class, multi -sport complex. 2. Authorize staff to secure financing up to $4.1 million as the City's financial obligation to this Agreement. 3. Authorize staff to solicit responses to an RFP to identify the economic impact of the proposed Yakima Sports Complex on Yakima's economy. 3. Sports Complex Analysis Comparable Facilities Comparable Location Soccer Complex Overland Park Soccer Complex Benchmarking Summary AnaiiL Mike Rose Soccer Complex Maryland Lawrence SoccerPlex Soccer Complex Overland Park, KS Germantown, MD Lawrence, IN Memphis, TN Market Population 173,000 2009 86,000 46,000 2000 _.....___._.m 2000 _..._..._.._._.. 655,000 1998 Year Opened Total Cost ($MM) $36.0 $19.0 $5.7 $13.0 Funding: % Public 100% 48% 100% 62% % Private 0% 52% 0% 38% Owner Public Private Public Public Operator Public Private Private Private Field Inventory 12 24 21 16 Utilization: _ Annual Tournaments 23 15 n/a n/a Total Visitors 996,000 650,000 285,000 285,000 Indoor Complex No Yes No No Location Abbott Sports Complex Cownie Soccer Park Average Median Lincoln, NE Des Moines, IA -- -- Market Population 269,000 203,000 239,000 188,000 Year Opened 1993 1998 2000 1999 Total Cost ($MM) $5.8 $5.5 $14.2 $9.4 Funding: % Public % Private 0% 100% 36% 74% 58% 44% 58% 45% Owner Private Public Public Public Operator Private Public Private Private Field Inventory 20 12 18 18 Utilization: _ __ Annual Tournaments n/a 8 15 15 Total Visitors 700,000 85,000 500,000 468,000 Indoor Complex Yes No No No Source: CSL International research Key characteristics of comparable soccer complexes include the following: • Comparable soccer complexes are located in markets with an average population of 239,000 residents. 51 ( • 50Z0 SP•ORTS March 25, 20 1 TABLE OF CONTENTS Complex Illustrations and Layout 1 Sports Complex Economic Summary 2 L Northwest Complex Comparisons Project Estimated Costs / Timeline Sozo Summary Business Plan © Copyright 3 4 5 li �141/•(44, Sozo Sports of Ce.lila' Wa1 if Li.it Sozo Greek word meaning: Verb: 1. to save, keep safe and sound, to rescue from danger or destruction 2. to preserve one who is in danger of destruction, to save or rescue S070 SPQRTS Yakima Sports Complex Project profile March 23, 2015 Community Planning Team ANSA ■ V'rtaiWare 1.911*V! • - . s r i' ;n, fit (Wort' J{==� . �� t i SI_ti11� = =rte., ,T = mss 1 — SOZO SPORTS .if central washington Yakima Sports Complex Project profile March 23, 2015 45".Vt, Community Planning Team 44 VtalWare Project schedule • • • • • • • • • • •• • r— i NB= „En • • • II • • • • ■ &Ms ills • - w • •• • • •• • •• • • ism S. S. • • * • • • . • •• • F j • r r • i•? e r • • •, '�• •--• a to -• i • • • • • • i February March April May June July August September October November December Januory Task Site Selection wti��• y, "`Ms�Ri' Design Development City agreement moi[{ Property Annexation ' ^fiy'r! ,t.=G:.ei'n# Permits SEPA igAgefflaggaZIEREEMEESRMESEriti Close Property •,41 Survey Engineering ,., Design & Engineering MONEESIMENIMM Bid Project MEIER= Permit M Start construction A M ,1Wj;%,,,,w,;;; Park Soft Opening EVA SOZO SPORTS Yakima Sports Complex Project profile Li March 23, 2015 Community Planning Team ,111SA -1VitalWare - • SOZO SPORTS of centr3 Yakima Sports Complex Project profile March 23, 2015 Community Manning Team (4-113S1 VitalWare Upper Deck Observation Public Observation Areas Security Office avarAr itrArli7 Ar'iby Ar�i41-// agii/ Proposed Facility Snack Bar / Restaurant Locker Rooms Observation deck for Fields Staff Locker Room Indoor fields: Soccer Video studio Retail Shops Facility Operation Office Snack Bar & Observation Public Restrooms First Aid Center Event Planning Office Child Care Lounge Meeting Rooms Equipment Storage Area Full Size Basket Ball Courts 1•1 SOLO SPORTS , Yakima Sports Complex Project profile March 23, 2015 Community Planning Team *ASA vtalWare 1',' -mss {l 14 I I p liF Air Soz� Sports Yakima Sports Complex Econor'nic Summary The Yakima area is an active sports community. According to the Yakima Valley Sports Commission the valley has ejrned 1:ho titio of Sports Capital of the Northwest based on the location. venues, weather, and local sunriort- We have certainly seen a number of new or improved facilities in recent years, resulting in a variety of well attended regional events. There are three soccer venues identified by the Yakima Sports Association: • Youth Activities Park in Union Gap is a large mufti -use park with grass fields used for soccer. A Ioc:31 group has propo!..ed future improvements for soccer, but details are not available and funding is uncertain. • Perry Tech has offered a section of their property for soccer, but future development plans will limit or eliminate use. e Chest€ rley Park is the only soccer field park owned and maintained by the city of Yakima, but the condition of the fie ds has caused enough injuries that tearhs are looking elsewhere for tournaments and evens. Local families are looking for more fields and opportuhities for their kids. Businesses appreciate the economic impact of the events and tournaments. The new Yakima Sports Complex will not only meet local needs, but also attract teams from out of the. area. SOZO Sports o' Central Washington is a nonprofit organization with a vision to Inspire, Encourage, and Empower youth through participation in sports. And their mission is to provide a state of the art facility for youth and adult sports teams in the Yakima Valley. Soto is dedicated to delivering a positive and professional experience to the clubs and teams that use the Sozo facilities for youth sports and adult recreation. The founders of this facility will provide the opportunity for development to all youth, regardless of race, religion, socio-economic background or ability level. Sozo's goal is to supplement local parks with a premier soccer facility in Yakima. Soccer is already a thriving sport in the area, but lacks the fields and facility to meet the local league and tournament opportunities. A premier facility will offer indoor End outdoor fields, lights for after dark play, well maintained grass fields, and some artificial turf fields for championship dlay. Soto envisions a regional facility, and is inviting a number of businesses and groups to be a partner in this exciting venture. The response has been very positive. The conversation and outreach has resulted in Sozo gaining the commitment of over 100 teams and 1500 players across Yakima County for the new soccer complex, representing individuals at all levels of play from kids to adults ages 5-99. This includes recreational, select and regional programs. The Yakima Sports Complex is capable of hosting a variety of tournaments for soccer, as well as providing indoor basketball courts and other field games. Initial plans are to host four annual premier tournaments in 2016, as well as opportunities for soccer camps, practice fields, and local recreation. This new facility will become the central location in the state, truly the Sports Capita' of the Northwest. Currently, Yakima hosts two significant league matches and four tournaments. The Yakima Valley Sports Commission estimates the economic impact for 2014 based on overnight stays associated with these events is a total of $2,294,374. Based on this history we have calculated the following economic impact: Economic Impact to the Community Construction Spending Tournament Hotels 2015 2016 Future Years $ 11,800,000 $ 764,791 $ 2,294,374 $ 3,059,165 Operations Payroll $ 146,592 $ 291,370 $ 296,876 Local Purchasing $ 250,000 $ 75,000 $ 75,000 $12,961,383 10 Year Operation Impacts First Year Impact $2,660,744 $3,431,041 $ 34,310,413 $ 12,961,383 Total Impact to the Community first 10 Years $ 47,271,797 This does not include food and beverage, other revenue, or indirect expenses for utilites and services SOZO Sports' interest is twofold. The first is to receive the support of the community's public resources to build a successful sports program that will have a positive impact on the attitude and health of the area's children. Sozo will complement the public support with private funding, so that this public/private partnership can succeed. The program's second goal is to gain the support of businesses willing to make a real impact on the valley's youth. Individuals and businesses can'donate, sponsor, or participate in the Yakima Sports Complex activities. The current demographics, with the majority of valley children under the age of six, offers a unique opportunity for Yakima to have a dynamic impact on the area's youth. Yakima Valley businesses are lining up to become sport and facility sponsors. Yakima has a history of achieving great things with community support. In this case, the Yakima Sports Complex fills the need for additional sports fields, supports the local economy, and adds to the overall quality of life in the valley. Estimated usage of the Yakima Sports Complex for soccer only: Outdoor Youth Soccer: August- November Outdoor Adult Soccer: August -November Indoor Soccer: November -February Outdoor Youth Soccer: March -June Outdoor Adult Soccer: March -June Summer Camp: July NW Soccer Complexes • Star -Fire Sports NW Soccer Park — 7 FIFA Sized Fields — 8flfASized Fields — 5 Junior Fields — 4 Junior Sized Fields — 600 Parking spaces — 16-S al f gilds — 2 Indoor Fields — No Indy fields — 600 Parking spaces • Tracs - Pasco — 17 FIFA Sized Fields — 6 Softball Fields — 2840 Parking spaces — Indoor arena — No fields ,4\S1ar/ve YOUTH SOCCER ADULT SOCCER RESERVATIONS THE CAMPUS ABOUT US EVENTS CONTACT Q ADULT SOCCER LEAGUES 2015 TOURNASATS' KIDS SOCCER PROGRAMS y���ATea:d_ IT'S THE GAME OF THE WEEK, MAN. aswarar SPSL MEN'S LEAGUE SINALOA VS PACHUCA YOUTH INDOOR LEAGUES OUTREACH 10:141116 N YOSIM SOCCER S 19 DETAILS GAME SCHEDULES The Starfire Campus H °I f'•'. >,„r: ! :�II�Y,a .f: •.i - ,ril; I �•s{a�!-.I,,,. .,.,I''f �,,i' I' I; '! • I, 'I L 'II Synth DLit MR Turf field Grass field Reston Yp.NORTHWEST SOCCER PARK a -Part of the Whaic.orr 5c,cri.s C:ommiC4iorn :';a;:•:,. WHATCOM SPORTS COMMISSION WHATCOM COUNTY YOUTH SOCCER ASSOCIATION Home of Whatcom County Soccer WCYSA Spring 2015 Season Kicks Off March 21 T.'J RE a=rER Spring 2015 WCYSA Spring Recreational schedules posted here 00 SurnFRfr41` SriiiIh Fibs d Parking Waschke Road Entrance fHl 4 avvson SPORTS AUTHORITY. NWEC NOtTMWFST EVE CLINIC • 9 141 del lit tom, 24 17 122.1 23 -28 Office tf+i Bathrooms Par Ne ihwes7 Seccer Park. Spartspiex and it's proarms aid owned and opera red by the Nrhatcon Sports Cannission. a 5O1( C) 3 Nor. Prn i Corporaeon. The Whatcom Sowzs Commission is commit - red to apve!eo arid maintain athletic tcifitiee otthe highest stand - W H A T C O M ficitiConcemiens arils fir ore hena&tofthe citizens of Whetcom Ce mk WHATCOM COUNTY YOUTH SOCCER ,..ia.: !ASSOCIATION U fir rteR Noh*est Soccer Park Rules No pets on the complex: even if on a beasts — 5nddQ ewQ exc ..ption for guide animals. filo alcoholic beverages: county ordinance No smoking on complex: please limit smoking to your vehicles Park at your own risk: Improper use of parking area will result in towing Keep off the goals & nets: Goals and nets are not to be used as climbing apparatus for children as it can be dangerous if tangled in the net No unauthorized use: WSC reserves the right to refuse park access to anyone 11 r 12 For all the latest information on 10 13 Whatcom County Soccer go to �-- .whatcomsoccer.com r �1` 1� 4 .. Baseball Field venue Map is not to Scale 77V C > THREE RIVERS MEM CONFERENCE Posts TRAC Hishxy ember SOT:Ms Schedules Standings LFafl Sports ;:: Winter Sports ::1Spring Sports :1;[ Contact Us I Apps Advertising UI Cenlral Clay Findlay Fremon: Catholic Ross THREE RIVERS ATHLETIC CONFERENCE News 1 College SigningsNerbals 3/21 OHSAA Girls Basketball State Champierisliip Division I State Championship at Jerome Schottenstein Center Lakota West 4 Notre Dame Ac aciem... 38 Box Score Tweet 'C TRAC Twitter Tweets Trac Sports 771,4C Follow D I Sutze Final 5<o7e: Laknr.3 Dal9E tc N. DA Qr, :seaso,, NDA Basketball 72meout ?7-31; v.:11:- 5:2! lek in gar.e. TRAC Fields • •AirVgir...47,, ...747,;;;;;;;+.4f,•••IitT•Iii70-7-7641 ' • • 1. .1.,. .i.". : • . -A-m. '-.! - -,•,..ct'-‘,, • 7% re ''-':.--*-:-14-• L.,, 4AF:,„ ...".••;,4•i! ‘,"6"..,-,..- --;., ':-P'4-.-re 4i'i•-,- ...•,-...., mio-Altsovomako,,,,„ qr. AR1044r=1.X !iLA • -,- ..7filafi-VAngkr.gagROCnir2VAIWAVS•€.381‘74MAIMIN:aii "IF4,1i-!itT'-'34/11401471ifffieelAftl, 6520 Homer= Rd 3/25/2.015 Project Cost Analysis & of Funding Sources Estimated Cost City Park Component 42.18 Acres SOZO Sports Component 16.4 Acres Total project *includes Land cost / A&E / Construction Source of Funds City of Yakima SOZO Sports Cash and in-kind Contributions and Sponsorships Total $ 5,382,232 45.66% $ 6,406,128 54.34% $ 11,788,359 100.00% $ 4,100,000 $ 5,100,000 $ 2,588,359 34.78% 43.26% 21.96% $ 11,788,359 100.00% Cost based on preliminary design and engineering analysis Property cost included / Permit and connection fees subject to final design Off site improvements limited to cost for signalized intersection at Ahtanum Rd and 38th Ave. SOZO SPORTS / PUBLIC PARTNER 3 23 2015 Schedule of Values GENERAL REQUIREMENTS SITE WORK DEMOLITION / ON SITE SITE UTILITIES / WATER / SEWER OFF SITE IMPROVEMENTS PREPARATION SITE / FIELDS SOCCER FIELDS ELECTRICAL / FIELDS IRRIGATION SYSTEMS / FIELDS PARKING AREA / FIELDS SITE LIGHTING SYSTEMS LANDSCAPING RESTROOM STRUCTURES FENCING SYSTEMS SPECIAL CONSTRUCTION COMMUNICATIONS SIGNAGE FACILITY SUPPORT BUILDINGS PARKING MANAGEMENT SYSTEMS UNASSIGNED Inkind Services & Products SUBTOTAL CONTINGENCY FACTOR 10.00% $ 26,590 $ 15,500 $ 5,700 $ 57,000 $ 350,000 $ 162,098 $ 1,161,872 $ 29,500 $ 150,200 $ 483,750 $ 303,200 $ 66,000 $ 120,000 $ 143,500 $ 21,500 $ $ (250,000) $ 2,846,410 $ 284,641 TOTAL PROJECT $ 3,131,051 SALES TAX 8.20% $ 256,746 TOTAL PROJECT W/SALES TAX $ 3,387,798 DESIGN & ENGINEERING $ 118,573 PERMIT FEES $ 38,500 TOTAL PROJECT ESTIMATED COST $ 3,544,871 Property cost $ 1,837,361 Total Property and Improvments $ 5,382,232 SOZO SPORTS / PRIVATE PARTNER 3 23 2015 Schedule of Values . a al .semaa.•%t:::.--' GENERAL REQUIREMENTS SITE WORK DEMOLITION / ON SITE SITE UTILITIES / WATER / SEWER OFF SITE IMPROVEMENTS PREPARATION SITE / FIELDS SOCCER FIELDS ELECTRICAL / FIELDS IRRIGATION SYSTEMS / FIELDS PARKING AREA / FIELDS SITE LIGHTING SYSTEMS LANDSCAPING RESTROOM STRUCTURES FENCING SYSTEMS SPECIAL CONSTRUCTION COMMUNICATIONS SIGNAGE FACILITY SUPPORT BUILDINGS PARKING MANAGEMENT SYSTEMS UNASSIGNED Inkind Products & Service SUBTOTAL CONTINGENCY FACTOR 10.00% $ 36,590 $ 66,000 $ 4,500 $ 31,000 $ 18,500 $ 122,913 $ 730,800 $ 15,500 $ 35,600 $ 191,925 $ 255,680 $ 71,500 $ 39,200 $ 4,500 $ 21,500 $ 2,625,000 $ 256,000 $ 50,000 $ (70,000) $ 4,506,708 $ 450,671 TOTAL PROJECT $ 4,957,379 SALES TAX 8.20% $ 406,505 TOTAL PROJECT W/SALES TAX $ 5,363,884 DESIGN & ENGINEERING $ 311,105 PERMIT FEES $ 68,500 TOTAL PROJECT ESTIMATED COST $ 5,743,489 Property cost $ 662,639 Total Property and Improvments $ 6,406,128 li ♦i f• �1 Z'1.1 fdi Ar SOZO orts of Central Wanington Yakima Sports Complex Sozo's vision Inspire, Encourage and Empower Youth through Participation in Sports SOZO Sports of Central Washington Sozo Sports Energize Yakima's Youth According to a Healthy Youth Survey Yakima's youth spend more time with "screens" than daily PE activities. • PE time has decreased from 46% to 37% • Screen time of more than 3 hours has increased 6% for middle school kids SOZO Sports of Central Washington tk)?7 Sozo Sports Increase Field Availability • JM Perry expansion and ash -based soil at Chesterley has left Yakima with a critical shortage of quality outdoor athletic fields • Yakima's central location could become the premier hot spot for regional, state- wide and local tournaments SOZO Sports of Central Washington ?A') Sozo Sozo Sports Economic Benefits Year round tournaments and events will attract players and families from around the Pacific Northwest supporting: • Hotels • Restaurants • Businesses SOZO Sports of Central Washington Sozo Sports Potential Participants Market size: $6.2M SOZO Sports of Central Washington Tournaments - All Ages Adult Recreation Youth Recreation P Premier Development Sozo Sports Competitive Landscape Competitors Weakness NW Soccer Park Star Fire Trac - Pasco Limited fields (Burlington) Westside location with fewer fields Indoor facility with artificial fields Sozo Opportunity Central Location /more fields Central location / more fields Indoor Et Outdoor facility with turf and competition fields SOZO Sports of Central Washington ): Sozo Sports Funding Needed $11.8 M 4.1 M from the City of Yakima 7.7 M from Privately Raised Funds 2.5 M Currently Secured SOZO Sports of Central Washington Sozo Sports Customers Er Sponsors • Schools & Businesses • Warehouse League • Club Teams • Mexican League • Puget Sound Premier League & US Soccer • Intramural Sports SOZO Sports of Central Washington :car: Sozo Sports Fundraising Activities GoFundMe.com Local Media — Radio/TV/Signs Schools and Businesses Open house type events Soccer Clubs Sponsoring Yakima United US Soccer Grant Yakima Community Foundation SOZO Sports of Central Washington Sozo Sports Financial projections $810K $271K FY'15 FY'16 Revenue $963K $358K FY°17 FY'15 SOZO Sports of Central Washington $814K $850K lit ($4K) $113K ($87K) FY'16 FY'17 FY'15 FY'16 FY'17 Expenses Profit Milestones Date Milestone April 30, 2015 Purchase Land (PSA signed February 2015) F`". July 31, 2015 SEPA - Completed n September 30, 2015 Sozo Indoor Design Completed 7 December 31, 2016 Achieve Fundraising Match of $7.1 M SOZO Sports of Central Washington SO;C; Sports Team and Key Roles Bob McAllister Founder / Director Jason Bakker Director Kerry Martin Founder / Director Jen Trammell Director SOZO Sports of Central Washington Lloyd Butler, DO Founder / Fundraising Jenna Stratton Director Sozo Sports Potential Community Partners ■ ■ ■ 8g Baker Boyer Bank Guiding you f. rr hri,glifer.trrnn?i-U, .huefre ,� Columbia L!IBank VitalWa re Delivering Revenue Cycle Success NNER PCLiftonLarsonALLenBANK Yakima Valley Farm Workers Clinic embank. SOZO Sports of Central Washington WELLS FARGO Sozo Sports Potential Community Partners ss-3€ar4 C1/1( Ccntral4Y'ashington Railroad API IAL A1)VISOKS MI COLUMBIA L RAB. SOZO Sports of Central Washington MOSS ADAMS Irdift CENTRAL WASHINGTON SOCCER ACADEMY Sozo Sports Sozo Wahingtonorts of Central Dr. Lloyd Butler Kerry Martin Bob McAllister Distributed at th Meeting I -1-I S 1 Jason Bakker Jenna Stratton Jenn Trammell A. YAKIMA SPORTS COMPLEX Sozo Sports 58 acres — 19 fields and indoor facilities — SPORTS PARK • 14 grass fields 3.0.51 • 3 lighted, synthetic turf fields '5 — SPORTS CAMPUS • Indoor athletic center • 2 indoor synthetic turf soccer fields • 3 basketball courts • Batting cages • Concession stand • Pro Shop • Locker room facilities • Training rooms • Office space ALAAPTED L65 SOI, CAW, 1 PKIII0140 3020 CAAPIA • • • •• • • • •• • • Mil :111 RI M • • 641111111 ra:.540 r % M' II • • S tftU NNW Allt. IP 1110 F:111=11 ittEr `tif Irtj ttf : •.iii r..:. i sr t r_ • • • •• • H f#f -0• S. •• issiskilitte.i1 SPORTS COMP,EX i • • •1 S. i� i • • • r• • • •• i• • ar- as d mop �4 • 5010 SPQ TS of Yakima Sports Complex mak, Project profile March 23, 2015 comm unit %Mi ig TIMM Yitalware Ir SoOZ0� SPwaORTS Yakima Sports Complex Project profile March 23, 2015 —41 OfiKiff unity P oJWW g Team VitalWare SOZof O� SPwaORTS • Yakima Sports Complex Project profile March 23, 2015 Commonly norm/mg Team (011STI ViWlWdre 320 Upper Deck Observation Public Observation Areas Security Office Entry 325 �j. Proposed Facility Snack Bar i Restaurant Locker Rooms Observation deck for Fields Staff Locker Room Indoor fields: Soccer Video studio Retail Shops Facility Operation Office Snack Bar & Observation Public Restrooms First Aid Center Event Planning Office Child Care Lounge Meeting Rooms Equipment Storage Arca Full Size Basket Ball Courts ):i SOZO SPORTS Yakima Sports Complex Project profile March 23. 2015 Com.nunnr Pionnng IOon. ® *am E VhalWerr 3J 1 1�/ SOZO SPI ORTS Yakima Sports Complex Project profile March 23, 2015 Commun0Y Mannhp ream 181 °` �YIS�A VitalWare • 1(i 044 II 1 O 4) AO Aliri hvikl # OP V dr iswar Soz� Srorts of Central Wa!hington LEASE AGREEMENT CITY OF YAKIMA TO SOZO SPORTS OF CENTRAL WASHINGTON, LLC This lease agreement (the "Lease"), made and entered January 4, 2016, by and between the CITY OF YAKIMA, WASHINGTON, a municipal corporation, ( the "City") and SOZO SPORTS OF CENTRAL WASHINGTON, a Washington non-profit corporation, or permitted assigns, ("SOZO"). WITNESETH: WHEREAS, City has certain property owned by it that is located south and west of Yakima Air Terminal -McAllister Field (the "Airport") and more properly described in Exhibit A (the "Property"), available for development as provided by this Lease, and SOZO desires to develop the Property in accordance with the specific terms and conditions set forth in the Agreement entered by the Parties hereto, and, WHEREAS, City has approved certain conditions to the Lease set forth in that certain Agreement between the parties hereto dated April 9, 2015, a copy of which is attached hereto as Exhibit B and incorporated herein by this reference (the "Agreement"). NOW THEREFORE, in consideration of the entry into the Agreement and of the mutual covenants contained herein and the benefit to be derived by each party, the parties agree as follows: 1. INTENT OF AGREEMENT: The intent of this Lease is to allow SOZO to develop the leasehold from bare land into a Soccer/Sports Complex. The development includes the construction of all necessary interior infrastructure (utilities, paving, parking area, soccer fields, concession stands, fencing, etc.), as depicted on Exhibit C attached hereto and incorporated herein by this reference, at the sole expense of SOZO. SOZO shall apply to the City for leasehold building/development permits no later than six (6) months after the date of entry of this Lease as set forth above. SOZO's failure to apply for building/development permits required for leasehold development within six (6) months from date of entry of this lease written above and to comply with the specific development provisions set forth in the Agreement shall be grounds for termination of this Lease at the sole discretion of the City. It is understood and agreed by the parties that the Agreement previously entered into by the parties contains terms and conditions necessarily incorporated by this reference into the Lease as if fully set forth herein. In the event of discrepancy between the terms of this Lease and the Agreement, the Agreement shall prevail. 1 2. DEMISE OF PROPERTY: City hereby leases to SOZO and SOZO leases from City the Property, together with all rights of ingress, egress, public road access and utility connections to the Property. SOZO shall develop the Property as provided in the conceptual site plan attached hereto as Exhibit C as soon as feasible following Effective Date of this Lease, subject to the terms and conditions set forth elsewhere herein. Failure by SOZO to meet the development deadlines herein contained and as represented in the Agreement shall constitute a material breach of the Lease, in which event City, at its option, may terminate the Lease and the Agreement for cause. 3. TERM — EFFECTIVE DATE: The tenancy provided by this Lease shall commence on January 4, 2016 and shall end on December 31, 2055. SOZO shall have the option to extend its tenancy under this Lease for two (2) additional ten (10) year terms by providing written notice to City at least six (6) months prior to the end of the preceding lease term. The sum of the term provided by the preceding two (2) sentences but as otherwise potentially terminated pursuant hereto is the lease term (the "Term"). The Effective Date of this Lease shall be the date upon which SOZO first submits an application for a building/development permit for the subject leasehold with the City. 4. MORTGAGE: SOZO and its subtenants or assigns shall have, and are hereby given, the right to mortgage the leasehold created by this Lease or by any sublease thereunder or assignment thereof, in whole or part, for a period of time not to exceed the Term. City shall be given written notice of any such mortgage, including the mortgagee's address and loan number. City shall have no right to terminate this Lease or retake possession of the Property unless thirty (30) days' written notice of such default is given by the City to SOZO and the mortgagee at the last address provided in writing by SOZO to City. Mortgagee shall have the authority to effect cure of said default to the same extent as SOZO if said cure is effected as provided in Section 21 hereof. 5. RENT: In consideration of the demise of the Property, SOZO agrees to pay to City rentals as follows: 2 Ten dollars ($10.00) per year, payable entirely in advance, upon execution of this Lease. Payments shall be made to the City of Yakima at the City Finance Office or at such other place as shall be directed by City. In the event of exercise of Options to Extend this Lease, payments for such renewal terms shall likewise be paid in advance, at commencement of each such extended term. 6. DEPOSIT: [Not applicable — deposit not required]. 7. TAXES AND LIENS: In addition to the reserved rent as it comes due, SOZO promises and agrees to pay, as the same become due and payable, all governmental fees and taxes, if any, payable by reason of this Lease, the use of the Property, or the construction or ownership of improvements thereto; provided, however, that leasehold excise tax shall be paid by City and not by SOZO. SOZO shall neither suffer nor permit the attachment of any lien or other encumbrance on the Property except as permitted by Section 4 hereof. SOZO agrees to defend, indemnify and hold harmless City from any such fees, taxes or liens. 8. USE: SOZO shall not commit waste and shall use the Property only for the construction, modification, remodeling and maintenance of a soccer/sports complex as described in the Agreement. SOZO's use of the Property shall be subject to the following additional limitations: A. Use, development and construction on the Property shall be compatible with private and commercial aircraft operations at, to or from the Airport as of the commencement of the Term, inclusive of considerations respecting takeoff and landing from existing runways overflight, avoidance of electrical interference with aircraft or ground control radio communications, lighting that interferes with visual location of the Airport, siding, lighting, or roofing that creates glare that materially affects pilots using the Airport, the creation of dust, smoke or steam that constitutes a danger to aircraft using the Airport, and crops, ground cover, or other improvements that attract wildlife constituting a danger to aircraft using the Airport. B. The Property shall be used only for sports -oriented community activity and reasonably -related activities and for any other use allowed by the Agreement, the Airport Master Plan and by the specific zoning of the Property in effect at the commencement of the Term or as otherwise approved by the City, such approval not to be unreasonably withheld or delayed. 3 C. Due to the proximity of the Yakima Air Terminal the Property shall not, at any time, other than with the express written approval of the Yakima Airport Manager, be used for staging, launching, over flight, hovering, performance or exhibition of any kind involving remote control (RC) aircraft, hover craft, drones, helicopters or unmanned aerial vehicles for any purpose whatsoever, including, but not limited to, recreational or commercial uses. 9. UTILITIES: SOZO shall be responsible for all utility services including, but not limited to, power, natural gas, water, sewer, and garbage from the exterior edge of the Property. 10. PREMISES CONDITION: SOZO accepts the Property AS -IS. Nothing contained in the preceding sentence shall affect SOZO's rights to indemnity from City as provided in Section 19 hereof. 11. MAINTENANCE: SOZO agrees, at its sole cost and expense, to keep the Property clean, and shall provide landscaping maintenance services, lawn and turf care, mowing, fertilizing, irrigation, aeration, sweeping, cleaning, field and parking lot cleanup, trash and litter collection, portable sanitation cleanup when and as required, such that landscaping on the Property remains healthy, attractive, clean and well-maintained. SOZO shall implement an effective program of weed control, garbage and debris removal, ash removal, snow removal and pavement maintenance. 12. SIGNS: SOZO shall have all rights to naming of the Property and its activities, including advertising and signage, subject to City codes generally applicable to all similarly situated uses. Notwithstanding the foregoing, the reference "Yakima", "City of Yakima", or other reference to "Yakima" as approved by the City shall be incorporated into names and signage when reasonably feasible. 13. IMPROVEMENTS: All buildings, fields, trade fixtures and other improvements to the Property by SOZO shall conform to applicable land use laws and building codes and shall be performed in accordance with the specific terms set forth in the Agreement. SOZO shall be responsible for procuring all building and other permits therefore. All 4 improvements shall be designed and constructed in accordance with SOZO's development plan, as amended from time to time and as disclosed from time to time by SOZO to City. City shall be entitled to approve such development plan and each material modification thereto before it becomes effective, such approval not to be unreasonably denied or delayed. Approval of such development plan or modifications thereof shall be deemed granted forty-five (45) days after submitting the proposal in writing to City if no specific response has been provided by City to SOZO within that time. City does not represent the feasibility or governmental approval, other than by City of any such development plan or modification thereto. City shall not impose a condition upon the approval of such Development Plan or modifications thereto that violate any applicable law, other than ones applicable to the Airport, or which would be violative of any insurance policy required to be maintained by SOZO. 14. REVERSION OF IMPROVEMENTS: Upon expiration or termination of this Lease for any reason, unless otherwise agreed to in writing between City and SOZO, all improvements to the Property shall revert to the City without requirement of payment of any type by City to SOZO. Upon termination or expiration of this Lease, SOZO shall remove all its trade fixtures and repair any damage to the premises caused by removal of trade fixtures to the reasonable satisfaction of the City Manager. Fixtures not removed within sixty (60) days after termination or expiration shall become the property of the City unless other arrangements have been previously approved in writing by the City Manager. SOZO shall, as additional consideration for grant of this Lease, insure that all liens, security interest and other encumbrances against said improvements and structures except those created or suffered by City, whether consensual or involuntary, shall be paid, discharged or satisfied prior to time for reversion thereof to City; and, in any event, the parties acknowledge that City shall not, by virtue of termination of the leasehold interest nor reversion of the structures or other improvements, be liable for any debt or encumbrance associated therewith, whether now existing or hereafter incurred, levied or attached. 15. REGULATIONS: SOZO agrees to comply with all applicable laws, ordinances, rules, regulations and policies of all governmental authorities having jurisdiction over the Property, including policies adopted by City, as such laws, ordinances, rules, regulations and policies apply to the use and operation of the Property. 16. SUBLETTING; PARTIAL ASSIGNMENT: 5 Subject to the agreement to perform and the performance of the terms hereof by any subtenant or partial assignee of SOZO, City's consent is required for any sublease or partial assignment of the Property by SOZO, which consent shall not be unreasonably withheld or delayed. No sublease or partial assignment shall relieve SOZO of its obligation to perform this Lease. 17. ASSIGNMENT: SOZO shall have the right to assign its interest in this Lease to an affiliated entity owned or controlled by SOZO or in a merger in which SOZO is the surviving entity or to a lender for security purposes, subject to the terms set forth in Articles 7 and 9.7 of the Agreement without City's consent, provided that SOZO shall give City written notice of and opportunity to review such assignment documents. Except as permitted in this paragraph, SOZO shall not assign its rights in this Lease without the prior written consent of City, which consent shall not be unreasonably withheld or delayed. City may withhold consent only based upon the financial condition of the proposed assignee and/or material change in proposed use of the Property. Any assignee of this Lease and/or SOZO's rights hereunder shall assume SOZO's obligations under this Lease and the Agreement, however said assignment shall not relieve SOZO of its obligation to perform this Lease in every respect. Such assignment shall be in conformance with all City, local, state and federal laws, ordinances, rules, regulations and policies and the assignee shall comply with all laws, ordinances, rules, regulations and policies applicable to the use and operation of the Property, facilities and operations as those laws, ordinances, rules, regulations and policies now exist or may hereafter become effective. Consent to assignment by City shall not be construed to be consent to any subsequent assignment. City agrees that, without need for further approval or consent, SOZO is authorized under this Lease to enter into space leases, rental agreements, and/or grant sub - concessions within the Property for individual facility operations, food and beverage services, athletic equipment operation, sales and service and similar supporting entities consistent with Section 4.12.1 of the Agreement. 18. MISCELLANEOUS PROVISIONS: A. City may further develop or improve Airport property and facilities regardless of the desire or views of SOZO regarding any such development or improvement, and without interference or hindrance on the part of SOZO and without liability to SOZO. B. SOZO shall limit the building area to that portion of the Property which is south of the building restriction line as defined by the Airport Layout Plan and to a height not to exceed thirty five (35) feet unless approved by Airport Manager and the Federal Aviation Administration. SOZO shall not erect or build temporary/ 6 permanent objects or structures which could cause a hazard to aircraft operations and/or penetrate the Airport's Part 77 Navigable Airspaces as described on the Airport Layout Plan and 14 Code of Federal Regulation Part 77 (all applicable sections). C. This Lease shall be subordinate to the provisions of any existing or future agreement between City and the United States of America relative to the operation or maintenance of the Airport, the execution of which has been or may be required as a condition to the expenditure of federal funds for the development of the Airport. D. Air space above the property may be exposed to aircraft noise, vibration, fumes, dust and fuel particulates, as may be inherent in the operation of aircraft, now known or hereafter used for aircraft navigation and flight while using said air space for landing at, taking off from, or operating within the Airport area. E. SOZO shall be responsible for weed control on non-developed parcels, including but not limited (where appropriate) to: mowing; spraying; removal of noxious weeds, etc. F.SOZO shall post undeveloped portions of the Property against trespass by unauthorized individuals, including no hunting signs, and shall prevent illegal dumping of debris on the property. 19. INDEMNITY/DUTY TO DEFEND: A. Except as provided in Paragraph 19(E), SOZO shall defend, indemnify and hold harmless City and its elected and appointed officials, employees and agents, from any and all losses directly suffered by City and from any and all liability, damages, suits, claims, actions, judgments or decrees, made against the City or its elected and appointed officials, employees and agents based on the use or occupancy of the Property during the Term or from default by SOZO or any assignee or subtenant hereunder, in any term or condition of this Lease. B. Except as provided in Paragraph 19(E), City shall defend, indemnify and hold harmless SOZO and its managers, members, agents, independent contractors, and employees, from any and all losses directly suffered by SOZO, its managers, members, agents, independent contractors and employees, and from any and all liability, damages, suits, claims, actions, judgments or decrees, made against SOZO or its managers, members, agents, independent contractors, or employees based on the use or occupancy of the Property for any time other than during the Term or as a result of City's default in any term or condition of this Lease, excepting any liability, damage, suit, or claim arising from the occupancy or use of the Property by SOZO or as a result of SOZO's operations on the Property or from any other act or omission of SOZO, its servants, employees, agents, invitees, independent contractors, assignees, subtenants or any other entity, person, firm or corporation acting on behalf of SOZO or under its direction, whether such claim shall be by 7 SOZO or a third party; provided, however, that SOZO shall not be liable for any injury, damage or loss occasioned solely by the sole negligence of City, its agents or employees. City shall give to SOZO prompt and reasonable notice of any such claims or actions and SOZO shall have the right to investigate, compromise and defend the same to the extent of its interest. C. City shall defend, indemnify, and hold harmless SOZO, its managers, members, agents and employees, from any and all claims and actions, loss, damage, expense or cost, resulting from, arising out of, or caused by City and which leads to any liability under the Federal Comprehensive Environmental Response Compensation Liability Act of 1980, as amended, 42 U.S.C. 9601 et seq.; Hazardous Materials Transportation Act, 49 U.S.C. 1801 et seq.; Resource Conservation and Recovery Act, 42 U.S.C. 6901 et seq.; the Clean Water Act, 42 U.S.C. 1251 et seq.; the Washington Environmental Policy Act, RCW Ch. 43.21C; the Washington Water Pollution Control Act, RCW Ch. 90.48; the Washington Hazardous Waste Management Act, RCW Ch. 70.105; the Washington Model Toxic Control Act, RCW Ch. 70.105D, and the regulations promulgated thereunder, or under any applicable local or state environmental ordinance, statute, law, rule or regulation. The provisions of this Paragraph 19(C) shall survive the termination of this Lease. D. SOZO shall defend, indemnify, and hold harmless City, its elected and appointed officials, agents and employees, free and harmless from any and all claims and actions, loss, damage, expense or cost, resulting from, arising out of, or caused by SOZO, its assignees and/or subtenants, resulting in any liability under the Federal Comprehensive Environmental Response Compensation Liability Act of 1980, as amended, 42 U.S.C. 9601 et seq.; Hazardous Materials Transportation Act, 49 U.S.C. 1801 et seq.; Resource Conservation and Recovery Act, 42 U.S.C. 6901 et seq.; the Clean Water Act, 42 U.S.C. 1251 et seq.; the Washington Environmental Policy Act, RCW Ch. 43.21C; the Washington Water Pollution Control Act, RCW Ch. 90.48; the Washington Hazardous Waste Management Act, RCW Ch. 70.105; the Washington Model Toxic Control Act, RCW Ch. 70.105D, and the regulations promulgated thereunder, or under any applicable local or state environmental ordinance, statute, law, rule or regulation. The provisions of this Paragraph 19(D) shall survive the termination of this Lease. E. The defense, indemnity, and hold harmless provided in Paragraphs 19(A) through 19(D) hereof shall apply only to the extent the party claiming same is not at fault with respect to the event giving rise thereto. If both parties are at fault, such defense, indemnity, and hold harmless shall be applied under principles of comparative fault. 20. INSURANCE: SOZO agrees that, at all times during the full term of the Lease, it shall, at its own expense, maintain in full force and effect adequate fire and other casualty coverage 8 for the Property and its contents, including all personal property, fixtures and improvements of SOZO. Such policy shall include a replacement cost endorsement. SOZO shall obtain and file with the City's Risk Manager a Certificate of Insurance evidencing such coverage. SOZO shall provide the City with a thirty (30) day cancellation notice prior to any policy cancellation. Adequacy of coverage is defined as insurance sufficient to restore the Property to its pre -casualty condition. Prior to execution of this Lease, SOZO, at its expense, shall obtain and file with the City's Risk Manager a Certificate of Insurance evidencing commercial general liability insurance coverage ("CGL") providing coverage of at least $2,000,000 per occurrence and $2,000,000 general aggregate. This Certificate of Insurance shall be subject to approval by the City's Risk Manager as to company, terms and coverage and said approval shall not be unreasonably withheld. The CGL shall name the City, its elected officials, officers, agents, employees, and volunteers as additional named insureds and must protect the City from any and all claims and risks and losses in connection with any activities or omissions by SOZO by virtue of this Lease or the Agreement. The CGL policy shall remain in full force and effect at SOZO's sole expense for liability for property damage or personal injury that may occur in connection with activities or omissions by SOZO, and provide continuous coverage for the full term of this Lease and the Agreement. SOZO shall ensure that the City's Risk Manager is given thirty (30) calendar days prior written notice, by certified mail, of any cancellation, lapse, reduction or modification of such insurance. 21. DEFAULT; TERMINATION; AND FORFEITURE: A. The failure by SOZO to comply with any material term, provision or condition of this Lease shall constitute grounds for termination of this Lease. This Lease and tenancy shall terminate for cause as specified above on written notice by City to SOZO stating in detail the manner in which SOZO fails or has failed to comply with this Lease. SOZO shall comply with this Lease in the manner specified in the notice within sixty (60) days (except twenty days with respect to default regarding payment of rent or other monetary obligation) from SOZO's receipt of such notice, provided, however, that if the nature of SOZO's default (other than for monetary defaults) is such that more than sixty (60) days are reasonably required for its cure, then SOZO shall not be deemed to be in default if SOZO commences such cure within said sixty (60) day period and thereafter diligently prosecutes such cure to completion, otherwise this Lease and tenancy shall be terminated. Such notice shall be given in writing and served on SOZO by personal delivery or mailed by certified mail with return receipt requested addressed to SOZO at its address stated below or such other address as the parties may advise each other in writing. Notices shall be deemed received three (3) days after mailing. In addition to the provisions hereinabove, and/or as an alternative or cumulative remedy, City may, at its sole election, pursue any other action, redress, or remedy now or hereafter available to City under the laws 9 of the State of Washington, including state Landlord -Tenant laws. B. As respects land and land improvements only, and not the building, as additional and not alternative remedy, optional with City and upon sixty (60) days written notice to SOZO, should SOZO be in default hereunder, City may cure or correct the same and the cost of such action by City shall immediately become due and payable from SOZO, together with late fees on said sum at a rate of ten percent (10%) per annum, and the non-payment of said sum by SOZO shall be adequate grounds for City to invoke the other remedies as provided in this Lease. C. The failure by City to comply with any material term, provision or condition of this Lease shall constitute grounds for termination of this Lease. This Lease and tenancy shall terminate for cause as specified above on written notice by SOZO to City stating in detail the manner in which City fails or has failed to comply with this Lease. City shall comply with this Lease in the manner specified in the notice within sixty (60) days from City's receipt of such notice, provided, however, that if the nature of City's default is such that more than sixty (60) days are reasonably required for its cure, then City shall not be deemed to be in default if City commences such cure within said sixty (60) day period and thereafter diligently prosecutes such cure to completion, otherwise this Lease and tenancy shall be terminated. Such notice shall be given in writing and served on City by personal delivery or mailed by certified mail with return receipt requested addressed to City at its address stated below or such other address as the parties may advise each other in writing. Notices shall be deemed received three (3) days after mailing. In addition to the provisions hereinabove, and/or as an alternative or cumulate remedy, SOZO may, at its sole election, pursue any other action, redress, or remedy now or hereafter available to it under the laws of the State of Washington, including state Landlord -Tenant laws. 22. VENUE, ATTORNEY FEES: In the event of litigation to enforce the rights and obligations hereunder, venue shall lie in a court of competent jurisdiction in Yakima County, Washington. The prevailing party shall be entitled to its reasonable attorney fees in addition to court costs. 23. NON-DISCRIMINATION CLAUSE: To the extent required by law, SOZO, for itself, its personal representatives, successors in interest and assigns, as a part of the consideration hereof, does hereby covenant and agree as follows: A. No person, on the grounds of race, color, religion, sex, age, marital status, handicap or national origin, shall be unreasonably excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in SOZO' 10 personnel policies and practices or in the use or operation of SOZO' services or facilities. B. SOZO agrees that in the construction of any improvements on, over or under City land and the furnishing of services thereon, no person, on the grounds of race, color, religion, sex, marital status, handicap, age or national origin, shall be unreasonably excluded from participation in, denied the benefits of, or otherwise be subjected to discrimination. 24. INTEGRATION: Exhibits and Recitals are incorporated herein by this reference. This Lease and the Agreement incorporated herein embody the entire agreement between the parties with respect to the subject matter herein contained. No amendments or modifications hereof shall be enforceable unless in writing, signed by the party to be charged. 25. NOTICE: All notices allowed or required hereunder shall be effective if given in writing and served by personal delivery or delivered by certified mail, return receipt requested, at the address shown below unless a different address is designated by a party in writing: If to City: If to SOZO: YAKIMA CITY MANAGER 129 N. 2nd Street Yakima, Washington 98901 SOZO SPORTS OF CENTRAL WASHINGTON 1200 Chesterley Drive, Suite 140 Yakima, Washington 98902 26. BINDING EFFECT AND BENEFIT: This Lease shall be binding upon and inure to the benefit of the parties hereto, their successors, assigns and subtenants. 27. ESTOPPEL CERTIFICATES: 11 City shall issue estoppel certificates to tenants, assignees, and lenders of SOZO upon request and in forms required by such tenants, assignees, and lenders. CITY: CITY OF YAKIMA, WASHINGTON By. Jeffre NCu er, Interim City Manager By: �`\✓_���� �', -204 Mark Kunkler,4Acting City Attorney Date /2-//-°/� Date STATE OF WASHINGTON ) ) ss County of Yakima I certify that I know or have satisfactory evidence that Jeffrey R. Cutter and Mark Kunkler signed this instrument, on oath stated that they were authorized to execute the instrument and acknowledged it as the Interim City Manager and the Acting City Attorney, respectively, of the City of Yakima, Washington to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. Date: I By: IJ & 1., Notary PublicJ Appointment Expires SOZO: io. S1' �00 CITY CONTRACT M _ c r - p 61 RESOLUTION NO: SOZO SPORTS OF CENTRAL WASHINGTON By: Kerry Martin, 12 resident Notary Public State of Washington SONYA R CLAAR TEE MY COMMISSION EXPIRES OCTOBER 25, 2018 Date STATE OF WASHINGTON County of Yakima ) ) ss ) isit.Ifk A ..... 4 A P Al. A TAMMY A. REGIMBAL Notary Public State of V ashington My Commission Expires July 9, 2017 I certify that I know or have satisfactory evidence that Kerry Martin signed this instrument, on oath stated that they were authorized to execute the instrument and acknowledged it as the President and , of SOZO Sports of Central Washington, a Washington non-profit corporation, to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. Date /- .7- 2_0/ 6 By: deo-nm--2 10,t,1' Notary Public Appointment Expires 7 " 9 " 17 13 EXHIBIT A CITY OF YAKIMA TO SOZO SPORTS OF CENTRAL WASHINGTON LEASE Lots 3 and 4 of Short Plat 7893928, records of Yakima County, Washington. Assessor's Parcels 181334-34003, 181334-43403 EXHIBIT B RESOLUTION NO. R-2015-051 A RESOLUTION authorizing an agreement with SOZO Sports of Central Washington for the development, management and operation of a premier soccer/multi-sport campus and indoor sports facility to serve the citizens of the City of Yakima and the Yakima area. WHEREAS, SOZO Sports of Central Washington is a Yakima -based non-profit corporation having the experience, desire, ability and resources to purchase, design, develop, maintain and operate a premier sports complex offering soccer and multi -sport opportunities to the citizens of Yakima; and WHEREAS, the City has dedicated funds available in the Capital Fund to contribute toward the acquisition of property and toward the development of portions of the proposed Yakima Sports Park; and WHEREAS, a premier Sports Complex would provide the City's youth and adults with soccer and recreational opportunities with a first-class development, while generating significant economic opportunity to the City and the surrounding area; and WHEREAS, the City currently has a total of only eleven soccer fields available to the citizens for general use; this number is insufficient to support the local needs or to attract outside users in any significant numbers; and WHEREAS, the proposed Sports Complex will provide seventeen outdoor fields, some of which will be engineered turf surfaces and some of which will be lighted, as well as an indoor soccer/sports facility, and WHEREAS, the Sports Complex will also provide passive recreational opportunities to the citizens of Yakima in the way of outdoor activities available when the sport fields are not in use; and WHEREAS, the City Council finds it to be in the best interests of the City of Yakima to enter into the attached and incorporated SOZO Sports Agreement to better meet the sports and recreational needs of the citizens of Yakima, Now, Therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The City Manager of the City of Yakima is hereby authorized and directed to execute the attached and incorporated Agreement between the City and SOZO Sports of Central NM-.Thington to acquire and develop a premier soccer/multi-sport complex within the City of Yakima. ADOPTED BY THE CITY COUNCIL this 7th day of April, 2015. /s/ Micah Cawley ATTEST: Micah Cawley, Mayor /s/ Sonya Claar Tee Sonya Claar Tee AGREEMENT THIS AGREEMENT ("Agreement") is entered into effective the J day of _ r, I , 2015 (the "Effective Date"), by and between the City of Yakima, a Washington municipal corporation ("City"), and SOZO Sports of Central Washington, Incorporated, a Washington non-profit corporation ("SOZO"). The City and SOZO are referred to collectively as the "Parties." In consideration of the promises, covenants, and provisions set forth in this Agreement, the Parties agree as follows: ARTICLE 1 RECITALS AND FINDINGS 1.1 Property. SOZO plans to purchase property located south of the Yakima Air Terminal, legally described in Exhibit A, attached hereto and incorporated herein by this reference. The property is located contiguous to the City limits on two sides of the property but is not within the City limits. SOZO intends to acquire the property from Bohannon. The property described in Exhibit A may sometimes herein be referred to as the "Bohannon Property". Upon SOZO's purchase of the property SOZO will apply for annexation to the City. Upon successful completion of the annexation, which the City pledges to support throughout the required process, the City shall purchase from SOZO a specified portion of approximately forty (40) acres of the Bohannon Property for the appraised value of the property, said specified portion to exclude that portion described hereinbelow as the SOZO Sports Campus. As the owner the City will lease the property so purchased, referred to as the "Yakima Sports Park", to SOZO and SOZO will develop the Yakima Sports Park as specifically set forth herein, in addition to developing SOZO's own parcels. From the Bohannon Property, SOZO has also arranged to convey a specified portion thereof to a sponsoring entity, Cleat City, LLC, said specified portion to consist of approximately twenty (20) acres of land upon which Cleat City will construct buildings and other improvements for utilization by soccer participants and others and shall lease them to SOZO. Approximately five (5) years after commencement of the Lease referred to hereinbelow, Cleat City, LLC shall convey those improved properties to SOZO for utilization in conjunction with the Yakima Sports Park as described herein. The portion of the Bohannon property to be conveyed to Cleat City has no current legal description, but is intended by the Parties to comprise approximately twenty (20) acres in the southeastern corner of the Bohannon Property approximating a square, the precise size, configuration and servitudes of which shall be determined by SOZO and Cleat City, but not in derogation of this Agreement. Parties agree that the property owned by SOZO and the property leased by SOZO from Cleat City (both prior to and following its conveyance from Cleat City) shall be referred to herein, from time -to -time, as "the SOZO Sports Campus". The entirety of the Bohannon Property and the SOZO Sports Campus may be referred to herein as "the Yakima Sports Complex". A proposed Building and Site Plan depicting preliminary intent of the Parties is attached hereto as Exhibit B and Agreement Between City of Yakima and 1 SOZO Sports of Central Washington incorporated herein by this reference. In order to ensure the availability of necessary irrigation water for the proposed Yakima Sports Complex, it is understood and agreed that all water rights associated with the Bohannon Property shall remain appurtenant to the Yakima Sports Complex and may be utilized with any portion or portions of the Yakima Sports Complex as SOZO may determine, not inconsistent with state law. 1.2 SOZO. SOZO has the experience, ability, and resources to develop and operate the athletic, recreation and associated facilities at the Yakima Sports Complex. SOZO intends to develop a regional facility to provide premier soccer ated athletic and recreational uses, to serve multi- age soccer teams within an appr mile radius from the boundaries of the Yakima Sports Complex (the "service area"). 1.3 Facilities. The Parties intend this Agreement to specifically identify the terms by which SOZO is granted the exclusive rights to lease the Yakima Sports Park from the City and to develop, construct, and operate SOZO Sports Campus and the Yakima Sports Complex, as described more fully in attached Exhibit C. SOZO shall operate concessions and impose fees and charges within areas of the Yakima Sports Complex, described herein, notwithstanding that the Yakima Sports Park and all publicly funded improvements thereon shall remain property of the City. 1.4 No Partnership. The Parties agree that no joint venture or partnership is formed as a result of this Agreement. 1.5 Premises. SOZO shall be responsible for the complete design and construction of the Yakima Sports Complex and associated landscaping. All improvements to the Yakima Sports Park shall remain the property of the City at the termination of this Agreement. 1.6 City Police Power. By entering this Agreement, the City does not waive any of its police power authority and shall retain granting authority over final permits for the Yakima Sports Complex, consistent with the intent of this Agreement, approval of which permitting shall not be unreasonably . withheld or delayed. 1.7 Access and Parking. The City will improve the public streets providing access to the Park; SOZO will be responsible to provide adequate parking to support the Yakima Sports Complex and its operations, as required by M-1 zoning as anticipated by the Parties. SOZO also agrees to provide all costs Agreement Between City of Yakima and -2- SOZO Sports of Central Washington associated with the installation of signalization for traffic control at the intersection of 38th Avenue and Ahtanum Blvd. 1.8 Financing. 1.8.1 SOZO will be responsible for obtaining all necessary financing for the development and operation of the Yakima Sports Complex, subject only to City participation as described in Article 5.10, herein. 1.8.2 It is mutually understood by the Parties that any lender who provides financing to SOZO for the development and operation of the SOZO Sports Campus will require this Agreement as protection and security for lender ("lender"). The term "lender" shall also mean the successors and assigns of the lender. 1.8.3 The City will acknowledge and consent to a lender taking a first position security interest in this Agreement, the Lease and the SOZO Sports Campus under mutually agreeable terms; lender taking an assignment of the right, title, claim and interest of SOZO in this Agreement; lender obtaining the right of substitution for SOZO, lender taking possession of the SOZO Sports Campus; lender operating the Yakima Sports Complex pursuant to the terms of this Agreement; and/or, lender selling, assigning and/or transferring SOZO's interest in this Agreement, the Lease, and/or the SOZO Sports Campus. ARTICLE 2 GROUND LEASE AND USE GRANT 2.1 Yakima Sports Complex. 2.1.1 City shall by separate lease instrument, forthwith upon gaining title thereto, convey and grant unto SOZO an exclusive lease of the Yakima Sports Park, for the development, construction and operation of that portion of the Yakima Sports Complex, as described herein. The Lease shall set forth, in substance, the intended outcome, terms and conditions of the operation of this Agreement. A preliminary building and site plan is shown in Exhibit B, attached hereto and incorporated herein by this reference. Any and all development, construction, and improvements of and to the SOZO Sports Campus are or shall be owned by or leased to SOZO subject to security interest of lender, if any. At the termination of this Agreement and the Lease, other than as a result of condemnation proceedings, the then existing improvements to the Yakima Sports Park shall remain the property of and be solely owned by the City. 2.1.2 The common address of the Yakima Sports Complex is Yakima, WA 98908. 2.2 Possession, Quiet Enjoyment and Covenants. Agreement Between City of Yakima and -3- SOZO Sports of Central Washington Except as provided in Article 4.13 herein, SOZO shall be entitled to exclusive possession and use of the Yakima Sports Park upon effective date of the Lease. Upon taking possession of the Yakima Sports Park, and subject to SOZO's continuing performance under this Agreement and the Lease, SOZO shall peaceably and quietly have, hold, and enjoy the Yakima Sports Park at all times during the full term of this Agreement and the Lease. Every covenant in this Agreement and the Lease shall be deemed and treated to be a covenant running with the Yakima Sports Park during the full term of the Lease and this Agreement, and shall extend to the heirs, legal representatives, successors and assigns of the Parties. No change in City's ownership of the Yakima Sports Park, or rights to the payments hereunder, however accomplished, shall operate to enlarge the obligations or reduce the rights of SOZO. No change in City's ownership of the Yakima Sports Park shall be binding upon SOZO for any purpose until SOZO shall have been given written notice thereof. ARTICLE 3 TERM OF AGREEMENT 3.1 Term. The Term of this Agreement and the Lease shall be forty (40) years, commencing upon the Effective Date of the Lease. 3.2 Option to Renew. So long as SOZO is not then in material, uncured breach of the Lease or this Agreement, it shall have the privilege of extending this Agreement and the Lease for two (2) additional ten (10) year terms upon the same terms and conditions, subject to any modifications as provided in Section 9.13 below. In order to exercise said renewal option(s), SOZO shall provide written notice to City not less than twelve (12) months prior to termination of the then current term of the Lease. ARTICLE 4 SOZO OBLIGATIONS 4.1 Agreement. SOZO agrees to the terms and conditions of this Agreement. 4.2 Not -For -Profit. SOZO will serve as the controlling, authorized entity responsible for enhancement and ongoing operation of the Yakima Sports Complex. Agreement Between City of Yakima and -4- SOZO Sports of Central Washington 4.3 Investment. SOZO will raise and invest not less than Four Million dollars ($4,000,000) in capital expenditures, loans and/or pledges for the design, development and operation of the Yakima Sports Complex, including the initial funding of SOZO operations, acquisitions and expenses provided by Cleat City, LLC and/or its principals. 4.4 Athletic Center Building. SOZO will construct an athletic center building on the SOZO Sports Campus parcel with at least two indoor soccer facilities and associated uses to include, but not limited to concession sales, pro shop, locker room facilities, three basketball courts, batting cages, office space, training programs, league play, and tournaments to the youth and adults of the City and the surrounding service areas. 4.5 Synthetic Turf Fields. SOZO will construct a minimum of three outdoor lighted engineered FIFA -sized, championship - quality synthetic turf soccer fields (or equivalent) and two indoor engineered fields and will make these fields available to the youth and adult teams from the City and surrounding service areas. 4.6 Grass Fields. SOZO will construct and maintain fourteen full size grass soccer fields and will make these fields available to the youth and adult soccer teams from the City and surrounding service areas. 4.7 Education — Scholarships. 4.7.1 SOZO will provide athletic skills, educational and development programs. SOZO will also provide team fee scholarships for disadvantaged youths from the City and surrounding service areas. 4.7.2 SOZO, as part of its community involvement program, will provide scholarships, grants, awards, and other benefits to the underprivileged as SOZO shall, in good faith, determine from time -to -time, taking into account its net profitability from operation of the Yakima Sports Complex, its need to fund future operations, improvements and acquisitions, and reflecting the intent of the Parties as set forth in this Agreement. SOZO's minimum annual contribution toward meeting this goal shall be no less than five percent (5%) of the net annual revenue derived from Yakima Sports Complex operation. The City may assist SOZO in this effort by publicizing availability of scholarships and recommending to SOZO worthy potential recipients of such scholarships who may have come to the attention of the City. Agreement Between City of Yakima and -5- SOZO Sports of Central Washington 4.8 SOZO Liaison. Upon City request, SOZO will provide a dedicated contact person and liaison with the City for all permit and license applications, changes and variances to complete the SOZO Sports Complex in an expedited manner. 4.9 SOZO Sports Campus and Yakima Sports Complex. SOZO will be fully responsible for all costs of improvement, operation and maintenance of the Yakima Sports Complex, except as described in Section 5, below. 4.9.1 Incidental Uses. SOZO may provide and/or authorize concessions, to include but not be limited to food and beverages; sale of incidental items directly related to the use of the SOZO Sports Campus including, but not limited to, pro shop athletic equipment, clothing, awards and related merchandise; soap, shampoo, sundries and supplies; day-care/babysitting service, fitness and sport training and gym activities. 4.9.2 Security and Nuisance During Use. SOZO shall take reasonable precautions to secure the Yakima Sports Complex throughout the full term of this Agreement. SOZO shall not use the Yakima Sports Complex for unlawful purposes and shall not use or occupy the Yakima Sports Complex in any manner that would constitute a public nuisance or violate Federal, State or local laws. 4.9.3 Operating Hours — Activities. The availability of recreational opportunities for City residents is a material consideration for this Agreement. SOZO and the CITY intend to generate active and passive uses for the Yakima Sports Park to serve the general public when not anticipated for use as a soccer facility or other pre -scheduled events. SOZO recognizes that the Yakima Sports Park's primary purpose is to provide community youth sports activities when the fields are not in use for specific pre - scheduled events; the Yakima Sports Park shall be made available to the youth and adult teams from the City and surrounding service areas. Except as specifically provided herein, the general public shall retain access during regular business hours to the Yakima Sports Park, which access may include "passive" individual activities that include, but are not limited to walking and jogging. Accordingly, throughout the full term of this Agreement SOZO shall continuously conduct and carry on SOZO's permitted uses and shall keep the Yakima Sports Park open for business and cause SOZO's business to be conducted therein during the usual business hours of each and every business day as shall be determined by SOZO based upon commercially reasonable standards. This provision shall not apply if the Yakima Sports Complex should be closed and the business of SOZO is temporarily suspended on account of labor strikes, lockouts, or similar causes beyond the reasonable control of SOZO, or for maintenance, remodeling, repair, or renovation as provided in the Lease. SOZO covenants and agrees to provide sufficient Agreement Between City of Yakima and -6- SOZO Sports of Central Washington personnel, and to keep the SOZO Sports Campus adequately stocked with merchandise, recreational equipment, fixtures and facilities so as to conduct its business in accordance with sound business practice. SOZO, in order to keep its business commitments, shall be in operation in accordance with standard business practices. 4.10 Entry by City. City may, during normal operating hours, enter the Yakima Sports Park at all times to inspect, provide services required hereunder, post notices of SOZO's noncompliance with the provisions of this Agreement or the Lease, all without being deemed a constructive eviction. Any person or persons who may have an interest in the purpose of City's visit may accompany City. City has the right to use any and all means that City deems proper to open doors and gates in an emergency in order to obtain entry to the Yakima Sports Park. 4.11 Health Inspections. SOZO shall not knowingly commit or willfully permit to be committed any negligent act or thing contrary to the rules and regulations prescribed by the local board of health, or which shall be contrary to the laws, rules or regulations of any federal, state or municipal authority. SOZO shall allow the Yakima County Health Department to make regular and ordinary inspections of the Yakima Sports Complex as said health department may deem proper. 4.12 Maintenance, Repair, Improvements. 4.12.1 Maintenance. SOZO shall, at its sole cost and expense, clean and maintain the Yakima Sports Complex, a"rl make repairs, restorations, and replacements to the Yakima Sports Complex, including without limitation the heating, ventilating, air conditioning, mechanical, electrical, and plumbing systems, structural roof, walls, and foundations, roof coverings, sprinkling and irrigation systems, playing surfaces and the fixtures and appurtenances to the Yakima Sports Complex as and when needed to preserve them in "first class" condition and repair (less normal wear from use) throughout the full term of the Lease. SOZO shall further keep in repair and maintain as necessary all machinery, equipment and facilities necessary for the playing of sports and the comfort of players. SOZO shall paint the exterior of the buildings on the Yakima Sports Park (except the metal) with such frequency as may be required to maintain their good, clean appearance. All such repairs, restorations, and replacements shall be performed and provided in quality and workmanship at least equal to the original work or installations. If SOZO fails to make such repairs, restorations, or replacements to equipment, improvements or buildings on the Yakima Sports Park within ninety (90) days of written notice by City, City may, but shall not be obligated to, make them at the expense of SOZO and such expense will be paid by SOZO within fifteen (15) days after delivery of a statement for such expense. Agreement Between City of Yakima and -7- SOZO Sports of Central Washington 4.12.2 Sidewalk Maintenance. At its sole cost and expense, SOZO shall maintain any sidewalks on the Yakima Sports Complex in good and presentable condition during the full term of this Agreement, shall be responsible for correcting any unsafe sidewalk conditions and shall be responsible for the removal of ice and snow from the sidewalks. 4.12.3 Janitorial Services. At its sole cost and expense, SOZO shall keep the Yakima Sports Complex clean, and shall provide sufficient janitorial services to maintain a tidy appearance on and about the Yakima Sports Complex. SOZO shall provide landscaping maintenance services, lawn and turf care, mowing, fertilizing, irrigation, aeration, sweeping, cleaning, field and parking lot cleanup, trash and litter collection, portable sanitation cleanup when and as required, such that landscaping on the Yakima Sports Complex remains healthy, attractive, clean and well maintained. 4.12.4 Repair of Damage. In the event any material damage shall occur to the Yakima Sports Park of any kind or nature whatsoever, SOZO shall promptly cause said damage to be fully repaired or replaced, as is necessary, at SOZO's own cost and expense. In the event SOZO fails to accomplish such repair or replacement within forty-five (45) days of receipt of written notice by the City, then in that event City may, but is not required to, enter the Yakima Sports Park and accomplish such repairs and thereafter bill SOZO who will pay the bill within fifteen (15) days after City sends rn invoice for such expense. 4.12.5 Improvements. SOZO shall be solely responsible for providing adequate funding for any alterations or improvements to the Yakima Sports Complex as provided in this Agreement and such alterations or improvements shall be made without cost to the City, except as provided in Section 5.2, 5.3 and 5.10. All alterations and/or improvements made upon the Yakima Sports Complex shall be subject to compliance with all required permits, inspections and codes applicable to the actions performed and shall be accomplished in accordance with generally accepted construction methods and means. 4.12.6 Alterations of Premises After Construction. After such time as the Yakima Sports Park has been completed and accepted as defined above, SOZO shall not make any material alteration to the Yakima Sports Park, including any changes to the landscaping, without the City's prior written consent, such consent to not be unreasonably withheld or delayed. For purposes of this subsection, a "material alteration" shall be deemed alterations not to exceed the cost to SOZO of $20,000 in any calendar year, adjusted annually on each Lease commencement date to a sum equivalent to one hundred five percent (105%) of the sum of the previous year's monetary limit. Agreement Between City of Yakima and -8- SOZO Sports of Central Washington 4.13 Signs. SOZO may place and maintain signs upon the Premises in accordance with the City sign ordinance. 4.14 Utilities. 4.14.1 Utility Services and Expense. Except as otherwise provided in this Agreement or in the Lease, SOZO will pay for all domestic and irrigation water, gas, garbage, sewage, electricity, telephone, and other utilities and communications services used by SOZO on the Yakima Sports Complex, whether or not such services are billed directly to SOZO. SOZO will also procure, or cause to be procured, without cost to the City, any and all necessary permits, licenses, or other authorizations required for the lawful and proper installation and maintenance upon the Yakima Sports Complex of utility appurtenances and appliances for use in supplying such utilities and services to and upon the Yakima Sports Complex. The City, upon request of SOZO, and at the sole expense and liability of SOZO, will join with SOZO in any application required for obtaining or continuing any such services, provided that such services do not violate any other applicable provision of this Agreement. The City shall not be held liable for any injury, loss, or damage caused by or resulting from any interruption or failure of utility services due to any cause whatsoever, unlet:s such interruption or failure is the result of the City's negligence. SOZO shall not be entitled to any offset, reduction, or return of consideration as a result of any interruption or failure of services. 4.14.2 Trash & Garbage. SOZO shall place all trash and garbage from the Yakima Sports Complex into such areas and containers as are designed and intended to accommodate the trash and garbage generated within or on the Yakima Sports Complex. SOZO shall not allow trash and/or garbage to accumulate such that a nuisance or health hazard results or attract wildlife that could cause potential hazards to aircraft operations at the Yakima Air Terminal. 4.15 Hazardous Substances. 4.15.1 Definition. As used herein, the term "Hazardous Substance" means any hazardous, toxic or dangerous substance, waste, or material, which is or becomes regulated under any federal, state, or local statute, ordinance, rule, regulation, or other law now or hereafter in affect pertaining to environmental protection, contamination, or cleanup. Agreement Between City of Yakima and -9- SOZO Sports of Central Washington 4.15.2 Access to Environmental Information. SOZO shall keep upon the Yakima Sports Complex, in a location accessible to City on request during normal business hours, copies of all reports regarding hazardous or toxic materials in or upon the Yakima Sports Complex that SOZO has provided to any governmental agency in the previous quarter. SOZO shall, upon request by City and at SOZO's expense, provide City with a copy of any such report. In the event of any accident, spill, or other incident involving hazardous or toxic matter that SOZO is required to report to any governmental agency, SOZO shall immediately report the same to the City and supply City with all information and reports with respect to the same, together with SOZO's clean-up or remediation plan and schedule. If sue;, clean-up or remediation plan is not acceptable to City in City's discretion, City may so notify SOZO and, upon 48 hours prior written notice (or without notice if so required by an emergency) may enter on the Yakima Sports Park to conduct the cleanup or remediation and charge SOZO the cost thereof. All information described herein shall be provided to City regardless of any claim by SOZO that it is confidential or privileged, provided that the City shall not publish or disclose the information to any third party except as pursuant to Chapter 42.56 RCW. 4.15.3 Environmental Indemnification. SOZO agrees to hold harmless, protect, indemnify, and defend City from and against any damage, loss, claim, or liability, including reasonable attorney's fees and costs, resulting from SOZO's use, disbursement, disposal, transportation, generation, and/or sale of any Hazardous Substances. The City agrees to hold harmless, protect, indemnify, and defend SOZO from and against any damage, loss, claim, or liability, including reasonable attorney's fees and costs, resulting from (a) Hazardous Substances existing on the Yakima Sports Park as of the Effective Date of the Lease; or (b) Hazardous Substances thereafter used, disposed of, or generated on the Yakima Sports Complex by the City. These indemnities will survive the termination of this Agreement, whether by expiration of the Term or otherwise. 4.16 Risk of Loss. All SOZO's personal property of any kind or description whatsoever on the Yakima Sports Complex shall be at SOZO's sole risk, and City shall not be liable for any damage done to„),- loss o, .7c loss of, such personal property. ARTICLE 5 CITY OBLIGATIONS 5.1 Agreement. City agrees to the terms and conditions of this Agreement and shall assist in the annexation of property subject to this Agreement in serving a municipal purpose, as is authorized under State law. Agreement Between City of Yakima and -10- SOZO Sports of Central Washington 5.2 Off -Premises Street Access, Parking and Stormwater. 5.2.1 The City will maintain all existing public access areas serving the Yakima Sports Complex that are not part of the Yakima Sports Complex, including, but not limited to, stormwater retention facilities, consistent with such standards applicable to municipal parks owned and operated by the City. 5.2.2 The City will maintain all streets and parking areas that are not part of the Yakima Sports Complex property, including landscaping associated therewith, located adjacent to or providing access to and egress from the Yakima Sports Complex, consistent with applicable City standards. 5.2.3 The City will extend to exterior boundary lines of the Yakima Sports Complex such utility services, roads, sidewalks, gutters and lighting as are reasonably necessary to gain approval for zoning modification and/or development of the Yakima Sports Complex, or to operate the Yakima Sports Complex, as part of City's Investment set forth in Section 5.10. 5.3 Naming Rights — Signs — Zoning. 5.3.1 The City grants to SOZO all rights to Yakima Sports Park naming and advertising, including the naming of the complete Complex, which shall be coordinated by SOZO as part : f the property acquisition with real property funders/lenders/donors. Provided, however, the reference "Yakima," "City of Yakima", or other reference to "Yakima" as approved by the City shall be incorporated into names and signage when reasonably feasible. 5.3.2 The City agrees to cooperate with SOZO to modify the zoning code to facilitate the development of any portion of the Yakima Sports Complex not otherwise permitted outright under the zoning code, and Parties agree that if the full intent of this Agreement cannot be achieved absent such zoning modifications, then either Party may terminate this Agreement prior to entry into the Lease 5.3.3 The City will install directional signage to the Yakima Sports Complex as appropriate in various locations throughout the City. 5.4 Liquor License. The City will support SOZO obtaining a liquor license for the SOZO Sports Campus through the established City approval process. 5.5 Public Safety. The City will provide police and fire services to the Yakima Sports Complex consistent with applicable City standards. Agreement Between City of Yakima and -11- SOZO Sports of Central Washington 5.6 Permitting. The City will make its best effort to expedite all permits, licenses and other municipal approvals required for completion and operation of the Yakima Sports Complex. 5.7 City Liaison. The City will provide a dedicated contact person and liaison with SOZO for all permit and license applications, changes, and variances to complete the Yakima Sports Complex in an expedited manner. 5.8 Promotion. The City will use its best efforts to promote and support the Yakima Sports Complex within the business community for the benefit of the Parties and the enhanced recreational use of the resources. 5.9 Fees and Charges. City grants and authorizes SOZO to establish and collect rents, fees and charges, and to retain all revenues, including special event/tournament parking revenues, associated with the use of Yakima Sports Complex. SOZO shall make reasonable efforts to balance admission fees for events within the Yakima Sports Park open to the public to represent (1) the cost of the event or activity, (2) the generation of revenue and (3) the regulation of Yakima Sports Park use, with the primary goal to maintain Yakima Sports Park use fees at a cost affordable to the public. 5.10 Investment. The City will provide Four Million One Hundred Thousand Dollars ($4,100,000) in capital expenditures toward the acquisition of property for and the development of the Yakima Sports Park as soccer fields and parking lots, as its part in development of the Yakima Sports Park, to include, but not be limited to, extension of sewer, water and other utilities to the Yakima Sports Park, construction of sidewalks, gutters and installation of lighting and on-site traffic control, if deemed reasonably necessary. Except as specifically stated hereinabove, City resources shall not be used for the acquisition of land for, or the design or development of the SOZO Sports Campus or for the structures and assets associated with the soccer building located on the SOZO Sports Campus parcel owned by or leased to SOZO upon which the soccer buildings and associated structures are located. ARTICLE 6 DESIGN AND CONSTRUCTION OF PREMISES Agreement Between City of Yakima and -12- SOZO Sports of Central Washington 6.1 Design. 6.1.1 SOZO shall retain a Washington State licensed architect or professional engineer to design the Yakima Sports Complex and associated exterior landscaping which shall visually blend with the setting. The City shall have the right to approve the final design of the Yakir.a Sports Park, which shall be consistent with established City zoning and/or design code. 6.1.2 Where required by applicable provisions of law, SOZO shall comply with the Americans with Disabilities Act of 1990 (ADA) in the design, construction, and operation of the Yakima Sports Complex. 6.2 Building and Site Plans. SOZO shall retain a Washington State licensed architect or professional engineer, registered in the State of Washington, to prepare building and site plans for the Yakima Sports Complex, which shall depict and describe the structures, utilities, and landscape plan. The City shall have the right to approve the final building and site plans comprising the Yakima Sports Park, such approvals to not be unreasonably withheld. 6.3 Construction/Site Work/Fencing. SOZO shall be solely responsible for all development and construction of the Yakima Sports Complex and shall be responsible for the site work, all required permits and grading. SOZO shall properly barricade the work area and install signage restricting unauthorized persons from entering onto the building site during any phase of development or construction. Unless otherwise specifically agreed by the City in writing, fencing shall be placed around the entire work area during construction. In addition, the building site shall be kept in a clean and organized condition during development periods. SOZO shall be responsible for site security, traffic and pedestrian signage, warnings and control at the site during the development and construction phases. 6.4 Construction Deadlines. 6.4.1 SOZO shall be required to commence development of the Premises within (6) months of the Effective Date of the Lease. Commencement of development of the Yakima Sports Complex is defined as that date upon which SOZO files its first application for a project permit, as defined in RCW 36.70(a).020(4). 6.4.2 SOZO shall be required to complete the development and construction of the Yakima Sports Park within one (1) year of the Effective Date of the Lease and thereafter proceed with due diligence to complete the remainder of the Yakima Sports Complex construction and development as described herein. Completion of the development and construction of the Yakima Sports Complex is defined as that date upon which all final occupancy permits are obtained by SOZO for all structures on the Yakima Sports Complex. Agreement Between City of Yakima and -13- SOZO Sports of Central Washington 6.4.3 SOZO may phase construction of improvements to those portions of the Yakima Sports Complex not comprising the Yakima Sports Park. 6.5 Failure to Meet Construction Deadlines/Time of Essence. 6.5.1 Except as provided in Section 6.4.3 or 9.15 herein, it is mutually understood and agreed that failure by SOZO to meet the development and construction deadlines shall constitute a material breach of the Lease and this Agreement by SOZO, in which event the City, at its option, can terminate the Lease and this Agreement for cause pursuant to Article 8. Time is of the essence with this Agreement. 6.5.2 Notwithstanding Section 6.4 and 6.5.1, SOZO's obligation to commence construction shall not begin until the City has issued building permit(s) for the Yakima Sports Complex. 6.6 Stormwater Drainage, Sewer and Water Lines. SOZO will be responsible for installing all required storm drains, stormwater facilities, sewers, water and irrigation lines from exterior boundary lines of the Yakima Sports Complex to all required use points within the Yakima Sports Complex, as required to complete development and construction of the Yakima Sports Complex. 6.7 Development and Construction Fees and Expenses. 6.7.1 SOZO shall be responsible for obtaining and paying for necessary permits, fees and expenses associated with the development and construction of the Yakima Sports Complex. Tn addition, SOZO shall be responsible for any additional costs for inspections billed to the City by any government agency, including not limited to the City of Yakima, Yakima County, or the State of Washington. 6.7.2 Notwithstanding Section 6.7.1, SOZO shall not be obligated to pay permit fees, City utility connection charges (if any) and expense, including any transportation impact or environmental mitigation fees, in an aggregate amount in excess of One Hundred Thousand Dollars ($100,000.00), excluding utility meter fees, to any portion of the Yakima Sports Complex. City shall be responsible for any such fees in excess of the amount set forth in this Section 6.7.2. 6.8 Partial Public Works Project. 6.8.1 The development and construction of that portion of the Yakima Sports Complex constructed on the City owned property shall be constructed as a public works project requiring the payment of prevailing wages. SOZO is the developer and the City is an investing partner in the cost of construction of that portion of the Yakima Sports Complex constructed on the City owned property. The City shall be involved with and shall have responsibility for the bidding and contracting processes for the public work portion of the Yakima Sports Complex. With respect to the construction of that portion of the Yakima Sports Complex constructed on SOZO's Agreement Between City of Yakima and -14- SOZO Sports of Central Washington property the City shall have no financial or other interest in the cost of property acquisition, design, construction or development thereon. The portion of the acquisition, design and development occurring on SOZO's property shall not be considered a public work and SOZO shall not be required to follow public works bidding requirements or to pay prevailing wages, nor will SOZO be obligated to pay or to contract for prevailing wages or any other standard of payment controls associated with this privately owned portion of the project. This provision is a material part of the consideration for this Agreement. 6.8.2 The project signage and all literature and advertising by either the City or SOZO shall not indicate in any manner that the development of the privately owned property is a City project, is subject to a City public work contract, or any other such misleading statement indicating that this private property development portion of the project is a public work project, either directly or indirectly. 6.9 No Liens. Except liens and encumbrances of any lender pursuant to Article 6 herein, it is mutually understood and agreed that SOZO shall have no authority, express or implied, to create or place any lien or encumbrance of any kind or nature whatsoever upon, or in any manner to bind, the interest of the City in the fee interest in the Yakima Sports Park, or to charge the rentals payable hereunder for any claim in favor of any person dealing with SOZO, including those who may furnish materials or perform labor for any construction or repairs, and each such claim shall affect and each such lien shall attach to, if at all, only the right and interest granted to SOZO by this Agreement. If any such liens are filed, City may, without waiving its rights and remedies for breach, and without releasing SOZO from its obligations hereunder, require SOZO to post security in form and amount reasonably satisfactory to City or cause such liens to be released by any means City deems proper, including payment in satisfaction of the claim giving rise to the lien. SOZO shall pay to City, upon demand, any sum paid by City to remove the liens. Further, SOZO agrees that it will save and hold the City harmless from any and all actual costs or expenses based on or arising out of the asserted claims or liens, except those of the lender, against this Agreement or against the right, title, and interest of the City in the City owned portion of the Yakima Sports Park or under the terms of this Agreement, including reasonable attorney's fees and costs incurred by City in removing such liens, and in enforcing this paragraph. Additionally, it is mutually understood and agreed that this paragraph is intended to be a continuing provision applicable to future repairs and improvements after the initial construction phase. 6.10 Insurance and Indemnification Requirements During Construction. 6.10.1 Indemnification/Hold Harmless SOZO shall require its construction contractors and subcontractors to defend, indemnify and hold the City, its officers, elected officials, employees and volunteers harmless from any and all claims, injuries, damages, losses or suits, including reasonable attorney fees, arising out of or in Agreement Between City of Yakima and -15- SOZO Sports of Central Washington connection with the performance of this Agreement, except for injuries and damages caused by the sole negligence of the City. 6.10.2 Commercial General Liability Insurance SOZO shall require its construction contractors to procure and maintain, for the duration of construction of the Yakima Sports Complex, commercial general liability insurance against claims for injuries to persons or damage to property, which may arise from or in connection with the performance of the work hereunder by the construction contractors and subcontractors, them agents, representatives, employees or subcontractors. All said policies shall name the City of Yakima, its elected officials, officers, agents, employees, and volunteers as additional named insureds and shall include a provision prohibiting cancellation or reduction in the amount of said policies except upon thirty (30) days prior written notice to the City. SOZO shall require its construction contractors to maintain minimum commercial general liability insurance limits of no less than $2,000,000 each occurrence, $2,000,000 general aggregate and a $2,000,000 products -completed operations aggregate limit. 6.10.3 Builders Risk Insurance. SOZO shall require its construction contractors to procure and maintain, for the duration of construction of the Yakima Sports Complex, Builders Risk insurance covering interests of the City and the constructions contractor in the work. Builders Risk Insurance shall be on all-risk policy form and shall insure against the perils of fire and extended coverage and physical loss or damage including flood, theft, vandalism, malicious mischief, collapse, temporary buildings and debris removal. The Builders Risk insurance covering the work will have a maximum deductible of Five Thousand Dollars ($5,000) for each occurrence, payment of which will be the responsibility of the construction contractor. Higher deductibles for flood perils may be accepted by the City upon written request by SOZO and written acceptance of the specific terms by the City. Any increased deductibles accepted by the City that are in excess of the Five Thousand Dollars ($5,000) maximum deductible will remain the responsibility of the construction contractor. The Builders Risk insurance shall be maintained until final acceptance of the work by SOZO. SOZO shall require its construction contractors to maintain Builders Risk insurance in the amount of the completed value of the project, with no coinsurance provisions. 6.10.4 Subcontractors. SOZO shall require its construction contractors to include all subcontractors as insureds under its policies or shall furnish separate certificate and endorsements for each subcontractor. All coverage for subcontractors shall be subject to all of the same insurance requirements as stated herein for the construction contractor. 6.10.5 Verification of Coverage. SOZO shall furnish the City with original certificates and a copy of the amendatory endorsements, including, but not necessarily limited to, the additional insured endorsement, Agreement Between City of Yakima and -16- SOZO Sports of Central Washington evidencing the Commercial General Liability insurance of the construction contractor before commencement of the work. Before any exposure to loss may occur, SOZO shall file with the City a copy of the Builders Risk insurance policy that includes all applicable conditions, exclusions, definitions, terms and endorsements related to this project. ARTICLE 7 FINANCING AND SECURITY INTERESTS 7.1 Financing — City Obligation. City shall share in the financing of construction improvements carried out upon, to, or with respect to all portions of the Yakima Sports Park, excluding any and all improvements upon SOZO's property, up to the total amount not to exceed Four Million One Hundred Thousand Dollars ($4,100,000). Costs of improvements to the Yakima Sports Complex beyond the City's "not to exceed" value set forth above shall be solely SOZO's responsibility for all financing requirements for all property acquisition, project design, property development, construction, maintenance, repairs, or subsequent improvements to the Yakima Sports Complex. The City shall be under no obligation directly or indirectly to pay for any labor, material, or improvement associated with the Yakima Sports Complex except as provided herein or mutually agreed upon in writing hereafter. SOZO shall, when applying for and obtaining financing, inform any lender that the City has no financial obligations associated with the construction, maintenance, repairs or subsequent improvements to the City owned portion of the Yakima Sports Complex beyond what is provided herein, and the City shall have no responsibility or participation obligation whatsoever in the development or construction of the privately owned SOZO property that is part of the overall Yakima Sports Complex. 7.2 Mortgages — Generally. SOZO, and its successors and assigns, shall have the unrestricted right to mortgage its interests under this Agreement and the Lease, subject, however, to the limitations set forth herein. As used herein, "Leasehold Mortgage" shall include any such mortgage(s) or deed(s) of trust on the Estate to be created by this Agreement; "Purchase Money Mortgage" shall include any Mortgage granted to SOZO (or SOZO's successors) in connection with the sale of the interest in this Agreement and/or the Lease; and "Estate" shall mean the estate of SOZO created by this Agreement and the Lease upon and subject to all the terms and conditions of this Agreement and the Lease. Any such Mortgage shall be subject to the rights of City hereunder in accordance with all the terms and conditions of this Agreement and the Lease. In no circumstances and under no condition shall City's fee interest in the Yakima Sports Park be encumbered by, subject to or subordinate to a Mortgage. 7.3 Security Interest in Premises and Agreement/Consent. Subject to the terms set forth in Section 7.2 the City consents to the grant, transfer, pledge and assignment of any and all right, title, claim or interest of SOZO in and to this Agreement and in the Lease, and in any SOZO building facility, personal property and fixtures in the Yakima Agreement Between City of Yakima and -17- SOZO Sports of Central Washington Sports Park ("Collateral") to lender for financing purposes. The City shall recognize lender's first priority security interest in the SOZO Collateral and the City hereby subordinates any and all interest of the City in said SOZO-owned Collateral to lender. SOZO acknowledges that the City will not grant any security interest to any lender in any City property nor will the City allow any encumbrance of any kind or nature whatsoever upon, or in any manner on its title to any City property. In the event of default by SOZO to lender, in addition to all its rights and remedies available at law and equity, lender may enforce and/or foreclose its security interest/interests in the Collateral. City agrees that in connection with any such default, and all without further consent of City, lender may: 7.3.1 Acquire SOZO's interest in the Collateral either by a deed in lieu of foreclosure or actual foreclosure; 7.3.2 Rent and/or grant a ground lease of the Yakima Sports Park subject to this Agreement pending foreclosure of the Collateral by lender; 7.3.3 Assign, sell and/or transfer the Collateral in whole or in part to any person or entity; 7.3.4 Take possession of any or all of the Collateral, obtain right of substitution for SOZO and operate said Collateral; and/or 7.3.5 Appoint a receiver. 7.4 Lender's Reliance on Term. The City acknowledges that SOZO, in making application for financing, may be required to have an assurance that the terms of this Agreement will extend beyond the term of the financing term. By its signature to this Agreement, the City confirms its authority to provide the forty (40) year Lease term conditioned solely upon SOZO maintaining current payments and remaining in full compliance with the terms and conditions of this Agreement and the Lease. Additionally, the City acknowledges that, after any original financial commitments by SOZO have been satisfied, these financing provisions shall be applicable to all future advances or financing required by SOZO and used for the improvements and repairs of the Yakima Sports Complex. 7.5 Surrender of the Collateral. No surrender of Collateral or the Yakima Sports Complex subject to this Agreement or any other act of SOZO shall be deemed to terminate this Agreement. City will not terminate this Agreement voluntarily by agreement with SOZO unless lender has been previously notified in writing and has consented to the termination in writing. This Agreement shall not be amended or modified unless lender has been previously notified in writing and has consented to such amendment or modification in writing. 7.6 Notice of Default and Lender's Rights. Agreement Between City of Yakima and -18- SOZO Sports of Central Washington 7.6.1 Notice of Default. If SOZO materially defaults under this Agreement or the Lease, or if any event occurs which would give City the right to terminate, modify, amend or shorten the term of this Agreement or the Lease, City shall take no steps to exercise any right it may have under this Agreement without first giving lender written notice of such default in accordance with Article 7.12 below. A copy of each and every written notice of default served or sent by City or its agent to or upon SOZO pursuant to this Agreement shall be sent contemporaneously to lender in accordance with Article 7.12 below. Such notice of default shall specify the event or events of default then outstanding and the time period at the end of which the indicated action would become effective. 7.6.2 Termination for Monetary Default. If the written notice of default given by City to lender relates to a monetary default and SOZO has not cured such monetary default within thirty (30) days after lender receives the notice and SOZO's failure to cure results in City desiring to terminate this Agreement or the Lease, City may terminate this Agreement and the Lease if such monetary default is not cured by either SOZO or lender within forty-five (45) days after lender receives the notice of default. 7.6.3 Termination for Non -Monetary Default. If the written notice of default given by City to lender relates to a non -monetary default and SOZO has not cured or diligently pursued curing such non -monetary default within thirty (30) days after lender receives the notice, City shall take no action to terminate this Agreement and/or the Lease if: a. Within sixty (60) days after City's notice to lender regarding SOZO's failure to cure (or failure to diligently pursue a cure) lender notifies City of its intent to realize upon its security interest and commences realization within sixty (60) days thereafter, and diligently pursues realization; and b. Lender pays City at time of notification all monies or performances due that may be in default up to the day lender notifies City of lender's intent and further pays or performs all consideration that accrues during the period after lender so notifies City and completes such other performances that may be required or that come due under this Agreement. City shall not terminate this Agreement nor the Lease because of SOZO's breach of any terms of this Agreement or the Lease relating to the solvency of SOZO or the institution of any bankruptcy, insolvency, receivership or related action by or against SOZO as long as lender cures any default under this Agreement by SOZO as provided herein, except that lender shall not be required to cure any defaults relating to solvency of SOZO. Agreement Between City of Yakima and -19- SOZO Sports of Central Washington 7.7. Right to Assign. Lender shall have the right to assign its interest in the Collateral. Upon the purchaser's, assignee's or transferee's assumption and agreement to perform and be bound by all of the terms of this Agreement and the Lease, lender shall be relieved from further liability under this Agreement and the Lease. If a lender finances the purchaser, assignee or transferee, said lender shall be subject to all obligations as set forth in this Agreement and the Lease. 7.8 Disposition of Insurance. Should the Collateral suffer any loss which is covered by casualty insurance, and the insurance proceeds are used to restore any improvements made by SOZO, City agrees that SOZO and lender shall have the right to such proceeds so long as none of the City's property, utilities or other services therein are damaged or all such damages are repaired to City's reasonable satisfaction. In the event the City's land is substantially damaged and SOZO's improvements have been repaired, City shall only participate in the insurance proceeds to the extent necessary to repair and restore City's land and any of the City's improvements on or in the ground to the same condition as existed at the time of the casualty. Other than as described herein, City shall have no claim to insurance proceeds that are attributable to SOZO's interest in the Collateral. 7.9 Right to Participate in Litigation. Lender shall have the right to participate in any litigation, arbitration or dispute directly affecting the Collateral or interest of SOZO or lender therein, including, without limitation, any suit, action, arbitration proceeding, condemnation proceeding or insurance claim. City, upon instituting or receiving notice of any such litigation, arbitration or dispute will promptly notify lender of the same. 7.10 Right to Remove Collateral. In the event lender exercises its rights under its Collateral, as provided in this Agreement, and realizes upon the Collateral, City agrees that lender is entitled to remove the Collateral, including but not limited to building facility, furniture, movable trade fixtures and equipment, from the Yakima Sports Complex at any reasonable time and that the Collateral shall remain personal property even though the trade fixtures may be affixed to or placed upon the Yakima Sports Park. In the event lender so realizes on its Collateral, City waives any right, title, claim, lien or interest in the Collateral. 7.12 Notices. All notices, copies of notices, demands, consents or other communications to lender given under this Agreement to lender must be in writing and shall be effective when received by personal delivery or as of the third business day after mailing by United States mail, postage prepaid, return receipt requested, or upon the next business day if delivered by Federal Express or similar next business -day delivery system. Such communications shall be given to an officer of lender Agreement Between City of Yakima and -20- SOZO Sports of Central Washington in a manner recognized by law as legal notification, addressed to lender at an address as provided by lender. ARTICLE 8 TERMINATION 8.1 Obligation to Perform. Nothing herein shall imply any duty upon City to do any work, which under any provision of this Agreement SOZO may be required to perform, and the performance thereof by City shall not constitute a waiver or SOZO's default in performance of the terms of this Agreement. 8.1.2 Payments to Other Parties. Except as otherwise expressly provided hereunder, all obligations of SOZO under this Agreement or the Lease will be performed by SOZO at SOZO's sole cost and expense. If SOZO fails to pay any sum of money owed to any party other than City for which SOZO is liable hereunder, or if SOZO fails to perform any other act on its part to be performed hereunder, and such failure continues for ten days after written notice thereof by City, City may, without waiving or releasing SOZO from its obligations, make any such payment or perform any such other act to be made or performed by SOZO. SOZO shall pay City, on demand, all sums so paid by City and all necessary incidental costs, together with interest accruing thereon at the lesser of one percent (1%) per month, or the maximum rate permissible by law from the date of such payment by City. 8.2 Default. 8.2.1 City's Default. City will not be in default unless City fails to perform an obligation required under this Agreement or the Lease within sixty (60) days after notice by SOZO, which notice must specify the alleged breach; provided that if the nature of City's obligation is such that more than sixty (60) days are reasonably required for cure, then City will not be in default if City commences to cure within sixty (60) days of SOZO's notice and thereafter diligently pursues completion and completes performance within a reasonable time. 8.2.2 SOZO's Default. The occurrence of any one or more of the following events constitutes a default under this Agreement and the Lease by SOZO: (1) SOZO shall be in default of the performance of any covenants, conditions, or provisions of this Agreement, other than the covenants for the payment of consideration required by this Agreement or the Lease, where such failure continues for a period of sixty (60) days after written notice by City provided that if the nature of SOZO's obligations is such that more than sixty (60) days are reasonably required for cure, SOZO will not be in default if SOZO commences to cure within sixty (60) days of City's notice and Agreement Between City of Yakima and -21- SOZO Sports of Central Washington thereafter diligently pursues completion and completes performance within a reasonable time; or (2) SOZO shall be adjudged a bankrupt, make a general assignment for the benefit of creditors, or take the benefit of any insolvency act, or if a permanent receiver and trustee in bankruptcy shall be appointed for SOZO's estate and such appointment is not vacated within sixty (60) days; or (3) SOZO Sports Campus becomes vacant or deserted for a period of sixty (60) days; or (4) if this Agreement or the Lease shall be assigned, or any portion of the Yakima Sports Complex be sublet other than in accordance with the terms of this Agreement or the Lease and such default is not cured within thirty (30) days after written notice to SOZO; or (5) SOZO shall fail to make any payment when due, or fail to make any other payment required hereunder or by the Lease when due, when that failure is not cured within thirty (30) days after mailing written notice thereof by City. 8.2.3 Default for Other Cause. This Agreement and the Lease may be immediately terminated for other cause by a party if the other party substantially fails to perform its obligations under this Agreement or the Leasc. through no fault of the terminating party, and the non-performing party does not commence correction of the failure of performance within sixty (60) days of the terminating party's sending notice of the default to the non-performing party. 8.3 Remedies are Cumulative. Remedies under this Agreement and the Lease are cumulative; the failure to exercise on any occasion any right provided by this Agreement or the Lease shall not operate to forfeit such remedy or right. 8.4 Destruction of Premises and Use of Insurance Proceeds. 8.4.1 Unless otherwise mutually agreed by the Parties, in the event the Yakima Sports Complex is destroyed or damaged by fire or other casualty, then SOZO shall proceed to rebuild and restore the Yakima Sports Complex, or such part thereof as may be damaged as aforesaid. In the event of any loss covered by the insurance policies described and required pursuant to Article 9.5.1 herein, and unless this Agreement or the Lease shall be terminated as a result of said loss, as provided herein, then the proceeds of such insurance policies shall be applied by SOZO first to rebuild and restore the Yakima Sports Complex and replace the improvements, fixtures, and equipment, which may be damaged or destroyed by such casualty. 8.4.2 Notwithstanding the forgoing, in the event the Yakima Sports Complex is destroyed by fire or other casualty SOZO may elect to restore the Yakima Sports Complex to a condition equivalent to or better as existed as of the date of the casualty, and terminate the Agreement and Lease without further obligation except as otherwise provided in this Agreement and the Lease. Agreement Between City of Yakima and -22- SOZO Sports of Central Washington 8.5 Duties Upon Termination. Upon termination of this Agreement and the Lease, and unless otherwise arranged in writing by the Parties, SOZO shall remove all its personal property, goods, and effects from the Yakima Sports Park. In the event that SOZO fails to perform this duty at termination, the City may cause such removal to be made and said personal property, goods, and effects to be stored, the actual cost and expense to be paid by SOZO. It is mutually understood and agreed that all improvements to the Yakima Sports Park shall revert to the City at the termination of this Agreement. 8.6 Eminent Domain. The following rules shall govern the rights and duties of the Parties in the event of interference with SOZO's use or possession of SOZO's privately owned portions of the Yakima Sports Complex as a result of the exercise of eminent domain or private purchase in lieu thereof. 8.6.1 Rights of Termination. If the whole of SOZO's privately owned portions of the Yakima Sports Complex shall be taken for any public or quasi -public use under any statute or by right of eminent domain, or by private purchase in lieu thereof, then this Agreement and the Lease shall automatically terminate as of the date that title shall be taken. If more than twenty-five percent (25%) of the privately owned portion of the Yakima Sports Complex shall be so taken and if the taking renders the remainder thereof unusable for the purposes for which the Yakima Sports Complex was intended in accord with this Agreement, then City and SOZO shall each have the right to terminate this Agreement and the Lease on thirty (30) days notice to the other given within ninety (90) days after the dais of such taking. Provided, however, that if the City is exercising its rights of eminent domain, a fair value shall be placed on this Agreement and SOZO's leasehold interest and the SOZO Sports Campus with the compensation thereof awarded solely to SOZO, or lender pursuant to its security interest, if any. 8.6.2 Non -Termination. If any part of the privately owned portion of the Yakima Sports Complex shall be so taken and this Agreement and Lease are not terminated, then the City shall, at its own cost and expense, restore the remaining portion of the Yakima Sports Complex to the extent necessary to render it reasonably suitable for the purposes for which it was intended in accordance with this Agreement. 8.6.3 Compensation. The compensation awarded or paid upon such a total or partial taking of the privately owned portion of the Yakima Sports Complex and/or this Agreement and the Lease shall belong to and be apportioned between the City and SOZO in accordance with their respective interests under Agreement Between City of Yakima and -23- SOZO Sports of Central Washington this Agreement and the Lease as determined by a court of competent jurisdiction. Additionally, SOZO may prosecute any claim directly against the condemning authority for the costs of removal of the goodwill, stock, trade fixtures, furniture and other personal property belonging to SOZO. City shall have no claim to condemnation proceeds that are attributable to SOZO's interest in the Collateral, including the Lease, nor shall lender have any interest in City's condemnation proceeds, if any. ARTICLE 9 GENERAL CONDITIONS 9.1 Relationship to Parties. 9.1.1 Independent Status. The Parties intend that an independent relationship shall be created by this Agreement and the Lease. Nothing contained herein shall create the relationship of principal and agent or of partnership or of joint venture between the parties hereto, and neither the method of computation of consideration nor any other provision contained herein shall be deemed to create any relationship between the Parties thereto other than the relationship of City as granting a ground lease to SOZO for which the City contributes investment capital for development of soccer playing fields. SOZO has the experience, ability, and resources to develop and operate the Yakima Sports Complex and is performing independent functions and responsibilities within its field of expertise. SOZO, its personnel and agents are independent contractors and not employees of the City. No agent, employee, servant, or representative of SOZO shall be deemed to be an employee, agent, servant or representative of the City. SOZO and its personnel have no authority to bind the City or to control the City's employees. As an independent contractor, SOZO is responsible for its own management. The City's administration and enforcement of this Agreement and the Lease shall not be deemed an exercise of managerial control over SOZO or its personnel. 9.1.2 No Third Party Rights Created. It is mutually understood and agreed that this Agreement and the intended Lease are solely for the benefit of the Parties hereto and gives no right to any other party except as provided by Article 7 herein. 9.2 Notices. Except as otherwise stated in Article 7, any notice required or permitted hereunder must be in writing and will be effective upon the earlier of (1) personal delivery, (2) three days after being mailed by certified mail, postage prepaid, return receipt requested, or (3) upon the next business day if delivered by Federal Express or similar next business day delivery system, addressed to SOZO or to City at the address for that party designated herein. Either party may specify a different address for notice purposes by written notice to the other, except that City may in any Agreement Between City of Yakima and -24- SOZO Sports of Central Washington event use the SOZO Sports Campus as SOZO's address for notice purposes. All notices shall be delivered to the following addresses: TO CITY: TO SOZO: 9.3 Reports and Information. Tony O'Rourke, City Manager City of Yakima 129 North Second Street Yakima, WA 98901 SOZO Sports of Central Washington, Inc. P.O. Box 48299 Yakima, WA 98908 When requested by the City, SOZO shall furnish periodic reports and documents on non - confidential matters covered by this Agreement and the Lease. The reports and documents shall be furnished in the time and form reasonably requested. SOZO shall maintain accounting records in accordance with Generally Accepted Accounting Principles (GAAP) for non-profit entities. 9.4 Permits, Licenses, Taxes and Fees. 9.4.1 Permits, Licenses and Other Documents. SOZO shall possess a current Yakima Business License and shall obtain all regulatory licenses and permits, including all construction and building permits, necessary to fulfill SOZO's obligations under this Agreement and the Lease at SOZO's sole expense. Each party agrees to execute such additional or other documents as may be required to fully implement the intent of this Agreement and the Lease. 9.4.2 Taxes and Fees. As an independent contractor, SOZO shall be solely responsible for its taxes, fees and charges incurred, including but not limited to license fees, business and occupation taxes, workers' compensation and unemployment benefits, its federal, state, regional, county and local taxes and fees, including income taxes, property taxes, permit fees, operating fees, surcharges of any kind that apply to any and all persons, facilities, property, income, equipment, materials, supplies or activities arising from SOZO' s property ownership and operations under this Agreement and the Lease. 9.4.3 Leasehold Excise. City shall be responsible for payment of leasehold excise tax, if any, under this Agreement and the Lease. Agreement Between City of Yakima and -25- SOZO Sports of Central Washington 9.4.4 Admissions Tax. The City acknowledges that SOZO, as a non-profit entity, is not subject to the City's admissions tax. In the event the City's admissions tax is made applicable to non-profit entities, including SOZO, all amounts collected and paid by SOZO to City as admissions taxes shall be a credit against (i.e., deducted from) amounts otherwise payable by SOZO to City under this Agreement and the Lease. 9.5 Insurance. 9.5.1 Fire and Casualty Insurance. SOZO agrees that, at all times during the full term of this Agreement and the Lease, SOZO shall, at is sole cost and expense, maintain in full force and effect adequate fire, flood and other casualty coverage covering the Yakima Sports Complex and its contents, including all personal property, fixtures and improvements. Such policy shall include a replacement cost endorsement. SOZO shall obtain and file with the City's Risk Manager a Certificate of Insurance evidencing such coverage. SOZO shall provide the City with a thirty (30) day cancellation notice prior to any policy cancellation. Adequacy of coverage is defined as insurance sufficient to restore the Yakima Sports Complex to its pre -casualty condition. 9.5.2 Liability Insurance During Term of Lease. Prior to the Effective Date of the Lease, SOZO, at its own expense, shall obtain and file with the City's Risk Manager a Certificate of Insurance evidencing commercial general liability insurance coverage ("CGL") providing coverage of at least $2,000,000 per occurrence and $2,000,000 general aggregate. This Certificate of Insurance shall be subject to approval by the City's Risk Manager as to company, terms and coverage and said approval shall not be unreasonably withheld. The CGL shall name the City, its elected officials, officers, agents, employees, and volunteers as additional named insureds and must fully protect the City from any and all claims and risks and losses in connection with any activities or omissions by SOZO by virtue of this Agreement and the Lease. The CGL policy shall remain in full force and effect at SOZO's sole expense for liability for property damage or personal injury that may occur in connection with activities or omissions by SOZO, and provide continuous coverage for the full term of this Agreement and the Lease. SOZO shall insure that the City's Risk Manager is given thirty (30) calendar days prior written notice, by certified mail, of any cancellation, lapse, reduction or modification of such insurance. 9.5.3 Release and Waiver of Subrogation. Any policy of insurance carried by either City or SOZO pursuant to any obligation under this Agreement or the Lease shall, to the extent available, contain a waiver of subrogation clause on the part of the insurer. Such waiver shall apply to damages to adjacent property owned by either Party. Notwithstanding any other provision of this Agreement or the Lease, neither City nor Agreement Between City of Yakima and -26- SOZO Sports of Central Washington SOZO shall be liable to the other party or to any insurance company (by subrogation or otherwise) insuring the other party for an loss or damage to any building, structure or tangible personal property of the other occurring in or about the Yakima Sports Complex, even though such loss or damage might have been occasioned by the negligence of such party, its agents or employees, if such loss or damage is covered by property insurance issued by an insurance carrier authorized or licensed by the Insurance Commissioner of the State of Washington to issue lines of insurance benefiting the party suffering such loss or damage or was required under the terms of this Agreement or the Lease to be covered by insurance by the party covering the loss. 9.6 Hold Harmless, Indemnification, and Industrial Insurance. 9.6.1 Hold Harmless and Indemnification. Each Party hereto agrees to be responsible for and assumes liability for its own wrongful or negligent acts or omissions, or those of its elected officials, officers, agents, volunteers or employees to the fullest extent required by law. Each Party agrees to save, indemnify, defend, or hold the other Party harmless against all liability, loss, damages and expenses, including costs and reasonable attorney's fees, resulting from actions, claims and lawsuits arising or alleged to have arisen in whole or in part, out of or in consequence of the acts or failures to act by the other Party, its elected officials, officers, employees, subcontractors, agents, volunteers or its assigns, which arise in any way out of the performance of this Agreement or the Lease. In the case of negligence of both the City and SOZO, any damages allowed shall be levied in proportion to the percentage of negligence attributable to each party, and each party shall have the right to seek contribution from the other Party in proportion to the percentage of negligence attributable to the other Party. 9.6.2 Industrial Insurance. The Parties have specifically negotiated SOZO's waiver of its immunity under Title 51 RCWv', which is hereby waived for purposes of SOZO's indemnification and hold harmless of the City, including the duty to defend. This provision shall be inapplicable to the extent such action, claim, or lawsuit is judicially found to arise solely from the acts or failures to act by the City. 9.7 Successors and Assigns. 9.7.1 The City and SOZO each agree to be bound to the other party in respect to all covenants, agreements, and obligations contained in this Agreement and the Lease. In recognition of SOZO's expertise and experience in soccer facility management, SOZO may not assign its rights under this Agreement nor the Lease without City's prior written consent to said assignment, which consent may be withheld in the City's sole and absolute discretion, specifically recognizing and accepting, nonetheless, the intent of the Parties to permit SOZO to convey a portion of the Bohannon parcel to Cleat City, LLC, and to lease it back after construction of improvements, without need for further consent by the City. Except as provided in Article 7 and Section 9.7.2 herein, neither party shall assign the Agreement in part or as a whole, without the Agreement Between City of Yakima and -27- SOZO Sports of Central Washington written consent of the other. Except as provided in Article 4.8 herein, SOZO shall not sublease any of the Yakima Sports Park, without written notice to and approval from the City. 9.7.2 The City acknowledges that SOZO is authorized under this Agreement and the Lease, without further City approval, to enter into space leases, rental agreements, and/or grant sub - concessions within the Yakima Sports Park for individual facility operations, food and beverage services; athletic equipment operation, sales and service; and similar supporting entities consistent with Section 4.12.1. 9.7.3 When requested, City's approval of a subcontract or sublease shall not be unreasonably withheld or delayed. 9.7.4 In the event of an assignment, subcontracting, or delegation of duties, SOZO shall remain solely responsible for the full and faithful performance of all terms and conditions of SOZO's responsibilities under this Agreement and the Lease; any assignee, subcontractor or other obligor shall also become responsible to the City for the satisfactory performance of the services, facilities, or equipment assumed. The City may condition approval of subcontractors and assignees upon the delivery by the assignee, subcontractor, or other obligor of its covenant to the City to fully and faithfully complete the requirements or responsibility undertaken under this Agreement and/or the Lease. 9.7.5 Notwithstanding the foregoing, provided SOZO is not in default, SOZO may assign its interest in this Agreement and/or the Lease to a parent, affiliate or subsidiary with City's written consent, which consent will not be unreasonably withheld or delayed. Except as otherwise provided herein, all of the covenants, conditions, and provisions of this Agreement are binding upon and inure to the benefit of the Parties and their respective heirs, personal representatives, successors, and assigns. 9.8 Bankruptcy. Except as provided in Article 7 herein, Parties agree that if SOZO is adjudged bankrupt, either voluntarily or involuntarily, then this Agreement and the Lease, at the option of the City may be terminated if the bankruptcy is not timely cured in accordance with Section 8.2.2. 9.9 Compliance with Laws. SOZO, its officers, employees, and agents shall comply with the applicable federal, state, county and local laws, statutes, rules, regulations, and ordinances, in performing its obligations under this Agreement and the Lease. Such compliance shall include abiding by all applicable federal, state and local policies to ensure equal employment opportunity based on ability and fitness to all persons regardless of race, creed, color, national origin, religion, sex, physical handicaps, or age. SOZO shall comply with applicable laws pertaining to employment practices and employee treatment. Conditions of the Federal Occupational Safety and Health Act of 1970 (OSHA), the Washington Industrial Safety and Health Act of 1973 (WISHA), and standards and regulations issued under these Acts must be complied. SOZO agrees to indemnify and hold harmless the Agreement Between City of Yakima and -28- SOZO Sports of Central Washington City from all damages assessed for SOZO's failure to comply with the Acts and Standards issued thereunder. SOZO is also responsible for meeting all pertinent local, state and federal health and environmental regulations and standards applying to any operation in the performance of this Agreement and the Lease. 9.10 Nondiscrimination. Parties shall not discriminate in employment or services to the public on the basis of race, color, national origin, sex, religion, age, marital status or disability, except for employment actions based on bona fide occupational qualification. 9.11 Choice of Law and Venue. This Agreement and the Lease shall be interpreted according to the laws of the State of Washington. Any action necessary to enforce the terms of this Agreement and the Lease or to resolve disputes arising out of this Agreement or the Lease shall be brought in a court of competent jurisdiction in Yakima County, Washington. 9.12 Costs and Attorney's Fees. In any action brought to enforce any provision of this Agreement or the Lease, including actions to recover sums due or for the breach of any covenant or condition of this Agreement or the Lease, or for the restitution of the Yakima Sports Park to the City or eviction of SOZO during the term or after expiration thereof, the substantially prevailing party shall be entitled to recover from the other party all reasonable costs and reasonable attorneys' fee incurred, including the fees of accountants, appraisers, and other professionals, at trial or on appeal, and without resort to suit. 9.13 Modification. This Agreement and/or the Lease may only be modified by written instrument signed by both Parties. 9.14 Change in Law/Renegotiation. The Parties agree that changes in federal, state or local laws or regulations that materially modify the terms and conditions of the Agreement or the Lease and result in a detrimental change in circumstances or a material hardship for either Party in performing this Agreement or the Lease may be the subject of a request by a Party to renegotiate this Agreement or the Lease, or negotiate amendments thereto and the responding Party agrees to renegotiate fairly with the requesting Party. Agreement Between City of Yakima and -29- SOZO Sports of Central Washington 9.15 Force Majeure. Provided that all other requirements of this Agreement and the Lease are met, either Party shall not be deemed to be in default and shall not be liable for failure to perform under this Agreement nor the Lease if that Party's performance is prevented or delayed by acts of God including but not limited to landslides, lightning, forest fires, storms, floods, freezing, earthquakes, volcanic ash, civil disturbances, strikes or labor interference, acts of the public enemy, wars, blockades, public riots, breakage, explosions, accident to machinery, equipment or materials, unavailability of required materials, governmental restraint or other causes, whether of the kind enumerated or otherwise, which are not reasonably within the control of that obligated Party ("Force Majeure"). If as a result of a Force Majeure event, an obligated Party is unable wholly or partially to meet its obligations under this Agreement or the Lease, it shall give the other Party promptly written notice of the Force Majeure event, describing it in reasonable detail. The obligated Party's obligations under this Agreement and/or the Lease shall be suspended, but only with respect to the particular component of obligations affected by the Force Majeure and only for the period during which the Force Majeure exists. 9.16 Waiver. Failure to enforce any provision of this Agreement or the Lease shall not be deemed a waiver of that provision. No waiver of any right or obligation of either party hereto shall be effective unless in writing, specifying such waiver, executed by the Party against whom such waiver is sought to be enforced. Waiver of any right or power arising out of this Agreement or the Lease shall not be deemed waiver of any other right or power. 9.17 Illegal Provisions — Severability. Should any part of this Agreement or the Lease be found void, illegal or unenforceable the offending provision(s) shall be stricken and the balance of the Agreement or the Lease shall remain in full force and effect. 9.18 Article Headings, Gender and Number. Article paragraph headings are not to be construed as binding provisions of this Agreement; they are of the convenience of the Parties only. The masculine, feminine, singular and plural of any word or words shall be deemed to include and refer to the gender and number appropriate in the context. 9.19 Entire Agreement. This Agreement, the intended Lease and their Exhibits constitute the entire agreement between the Parties, and the parties acknowledge that there are no other agreements, written or oral, that have not been set forth in the text of this Agreement. Agreement Between City of Yakima and -30- SOZO Sports of Central Washington 9.20 Counterparts. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 9.21 Recording. Upon the execution of this Agreement the City may cause this Agreement to be recorded with the land use records of Yakima County, Washington. Agreement Between City of Yakima and -31- SOZO Sports of Central Washington IN WITNESS WHEREOF, this Agreement has been entered into between the City of Yakima and SOZO Sports of Central Washington as of this day of April, 2015. CITY OF YAKIMA A Washington Municipal Corporation Tony 0 City Manager APPROVED AS TO FORM: / 11/ B Sonya Claar City Contract No.: 2 °' S 0 8 l Resolution No.: /Z • o i - &S/ Exhibit A — Legal Description of Yakima Sports Complex Exhibit B — Preliminary Building and Site Plans Exhibit C — SOZO Sports Campus SOZO SPORTS OF CENTRAL WASHINGTON, INC. A Not -for -Profit Washington Corporation B Date Agreement Between City of Yakima and -32- SOZO Sports of Central Washington Sozo Srorts of Central Wa Sports Dr. Lloyd Butler Kerry Martin Bob McAllister Distributed at th 4 . Meeting - _� S Jason Bakker Jenna Stratton Jenn Trammell Sozo Sorts of Centra! 1 hington YAKIMA SPORTS COMPLEX 58 acres —19 fields and indoor facilities — SPORTS PARK • 14 grass fields • 3 lighted, synthetic turf fields — SPORTS CAMPUS • Indoor athletic center • 2 indoor synthetic turf soccer fields • 3 basketball courts • Batting cages • Concession stand • Pro Shop • Locker room facilities • Training rooms • Office space 6.4s.a fiiE M 194 1r SO::O SPORTS of teotral wv3thington Yakima Sports Complex Project profile March 23, 2015 Community? 3nnbug Team • italWare SOZO SPORTS of central wa%h:ngton Yakima Sports Complex Project profile March 23, 205 CommonRy Manning r•an taIWare - cf S6Z6 SPORTS of ceitrJI kVaihinstun Yakima Sports Complex Project profile March 23, 2015 Cornimintly Planning Timm Upper Deck Observation Public Observation Areas Security Office Entry Proposed Facility Snack Bar % Restaurant Locker Rooms Observation deck for Fields Staff Locker Room Indoor fields: Soccer Video studio Retail Shops Facility Operation Office Snack Bar & Observation Public Rcstrooms First Aid Center Event Planning Office Child Care Lounge Meeting Rooms Equipment Stotage Area Full Size Basket Ball Courts SOZO SPORTS Yakima Sports Complex Project profile March 23, 2015 ca.momry 3 . g i•«, • SOZO SPORTS or central wathington Yakima Sports Complex Project profile March 23, 2015 CammvMy NonNnp team iIs Vitalware 3. Sports Complex Analysis Comparable Facilities hx,apnch efking SUnt ary�� . t ,x oM�ts?ra e2, e'C Om e Location. Overland Park Soccer Complex Maryland Lawrence SoccerPlex Soccer Complex Mike Rose Soccer Complex Overland Park, KS. Germantown, MD Lawrence, IN Memphis, TN Market Population 173,000 86,000 46,000 655,000 Year Opened 2009 2000 2000 1998 Total Cost ($MM) $36.0 $19.0 $5.7 $13.0 Funding: % Public 100% 48% 100% 62% % Private 0% 52% 0% 38% Owner Public Private Public Public Operator Public Private Private Private Field Inventory 12 24 21 16 Utilization: Annual Tournaments 23 15 n/a n/a Total Visitors 996,000 650,000 285,000 285,000 Indoor Complex No Yes No No Location Abbott Sports Complex Cownie Soccer Park Average Median Lincoln, NE Des Moines, IA -- Market Population 269,000 203,000 ' 239,000 188,000 Year Opened 1993 1998 , 2000 1999. - Total Cost ($MM) $5.8 $5.5 $14.2 ,. $9.4 Funding: % Public 0% 36% 58% 58% % Private 100% 74% 44% 45% Owner Private Public Public Public Operator Private Public Private Private• Field Inventory 20 12 18 18 Utilization: Annual Tournaments n/a 8 , . 15 15 Total Visitors 700,000 85,000 500,000 . 468,000 Indoor Complex Yes No No No Source: CSL International research Key characteristics of comparable soccer complexes include the following: Comparable soccer complexes are located in markets with an average population of 239,000 residents. 51 RESOLUTION NO. R-2015-103 A RESOLUTION authorizing the City Manager to execute AMENDMENT No. 1 to the SO70 Soccer Agreement to provide clarification on the property acquisition and transfer arrangement to facilitate the intent of the parties. WHEREAS, the City and SOZO Sports of Central Washington entered into a development, management and operation agreement for a premier soccer/multi-sport campus and indoor sports facility to serve the citizens of the City of Yakima and the Yakima area on April 9, 2015, and WHEREAS, the Agreement between the parties identified a plan for property acquisition, transfer and lease to accommodate the development of the proposed soccer complex; and WHEREAS, in the interest of accommodating an opportunity for alternative means of property acquisition to serve the soccer facility that may require a modification of the initially proposed property transactions set forth in the present Agreement the parties desire to amend the language of the Agreement to permit assignment of the property purchase and transfer responsibilities solely to allow greater flexibility in the purchase and development of the property; and WHEREAS, the City Council finds it to be in the best interest of the City to amend the original Agreement to permit an alternative course of property acquisition and transfer as set forth in the attached and incorporated AMENDMENT No. 1 to the Agreement between the City and SOZO Sports of Central Washington, Now, Therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The City Manager of the City of Yakima is hereby authorized and directed to execute the attached and incorporated AMENDMENT No 1 to the Agreement between the City and SOZO Sports of Central Washington to provide for alternative means for property acquisition and transfer to best accommodate the development of the Sports Complex ADOPTED BY THE CITY COUNCIL this 4th day of August, 2015. ATTEST: Claar Tee, City Clerk LiNhi c.‘ Micah Cawley, yor AMENDMENT No. 1 41- THIS AMENDMENT No. 1 (the "Amendment") is entered into effective the 5 lay of August, 2015 for the purpose of amending that certain AGREEMENT entered into on April 9, 2015, by and between the City of Yakima, a Washington municipal corporation ("City") and SOZO Sports of Central Washington, Incorporated, a Washington non-profit corporation ("SOZO") (the "Agreement"). The City and SOZO are referred to in the Agreement as the "Parties". 1. Authority. This Amendment is in accordance with Section 9.13 of the Agreement. 2. Substitution of Seller. City agrees that SOZO may assign its purchase of the property described in Section 1.1 and Exhibit A of the Agreement (the "Property") to a third party. In the event of such assignment, City agrees to purchase the property identified in the Agreement as the "Yakima Sports Park", from such assignee upon the same terms and conditions as those set forth in the Agreement as if the seller were SOZO. City further agrees ,that such assignment will have no other effect on the terms and conditions of the Agreement and City affirms its performance thereof. 3. Remaining Provisions. Except as specifically set forth herein, the remaining provisions of the Agreement are ratified by the Parties. 4. Counterparts. This Amendment may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, this Amendment has been entered into between the City of Yakima and SOZO Sports of Central Washington as of this day of August, 2015. CITY OF YAKIMA A Washington Municipal Co.. 4 By. �.:..�.L J►: Tony O' ' i ke, City Manager Date: U ' , 45 - APPROVED APPROVED AS TO FORM: By: ATT -T �i�Lr111 By: utter, City Attorney SOZO SPORTS OF CENTRAL WASHINGTON, INC. A Not -for -Profit Washington Corporation By Date: Avco 5 261-S Son Claar Tee, City Clerk City Contract No.: •2-63' 5-- D8 / Resolution No.• ' a -0(s'--/03 .4 - :,fir.' �r 1958' CNTAINING %ELL AND ER PAN' X W J 0 U N I— cx 0 0 0 IV 0 C/) M IIIIIIIILD1111111111n11111111111 IIIIIIIIIII N c 0 a_ m Q LLJ O cl C 66' 25 SITE PLAN / EAST Scale 1,80D. Parcel it: 18133434001 Address: 2210 S 38TH AVE, YAKIMA ,WA 98903 58.57 Acre(s) Owner. Clad City LLC Zoning: MI OWNFR DATA Nome: Dr Lloyd Butler Phone Number. (509) 307-4534 Address: Plow IL LLC 1214 No. 20th Ave. Yakima, WA 98902 SITF PI AN KFY .I'-- 162' 1964' rdreaping Public R/W Water Service Sewer Service Fence Required ofestreet paMrg table 6-1 94.100 / 200 = 471 required stats Parking Stalls Provided 1,238 Comp8ance planter area per 15A.06.090 Impervious Area A Parking lot area Sidewalk Main Building Support Building Tota Area Total Site Areo 510.311.1 sq N 66,361 sq N 80.000 sq ff 18.549 sq 0 675.221.1 sq ft 2.551,309 sq ft Impervious Coverage 26.46% NOTFS- Standard Parking Stag Dimensions: 9)(19' Standard Driveways: 25 DESIGN DEVELOPMENT Drawing Data Date: 12-042015 BY: Jake Heft o c,.,Mtzns ld e.o.,VrO,�oswroa.v �to, 14 ca..vL or Paean Issued For. 12.04.15 Comments Page Size: 18'7424" Verson: V2.7 Sh. et Number C.2 J IIBIHX2 am'. LE � Wil r r 1` A � n�ii /` A EMU oramr IIIIIIIILD1111111111n11111111111 IIIIIIIIIII N c 0 a_ m Q LLJ O cl C 66' 25 SITE PLAN / EAST Scale 1,80D. Parcel it: 18133434001 Address: 2210 S 38TH AVE, YAKIMA ,WA 98903 58.57 Acre(s) Owner. Clad City LLC Zoning: MI OWNFR DATA Nome: Dr Lloyd Butler Phone Number. (509) 307-4534 Address: Plow IL LLC 1214 No. 20th Ave. Yakima, WA 98902 SITF PI AN KFY .I'-- 162' 1964' rdreaping Public R/W Water Service Sewer Service Fence Required ofestreet paMrg table 6-1 94.100 / 200 = 471 required stats Parking Stalls Provided 1,238 Comp8ance planter area per 15A.06.090 Impervious Area A Parking lot area Sidewalk Main Building Support Building Tota Area Total Site Areo 510.311.1 sq N 66,361 sq N 80.000 sq ff 18.549 sq 0 675.221.1 sq ft 2.551,309 sq ft Impervious Coverage 26.46% NOTFS- Standard Parking Stag Dimensions: 9)(19' Standard Driveways: 25 DESIGN DEVELOPMENT Drawing Data Date: 12-042015 BY: Jake Heft o c,.,Mtzns ld e.o.,VrO,�oswroa.v �to, 14 ca..vL or Paean Issued For. 12.04.15 Comments Page Size: 18'7424" Verson: V2.7 Sh. et Number C.2 J IIBIHX2 AGREEMENT For City of Yakima Use Only: Contract No.1' ,OJ , 4W BETWEEN Project No 2 28 CITY OF YAKIMA, WASHINGTON Resolution No/it?00 L SOQ No. AND WIDENER & ASSOCIATES FOR PROFESSIONAL SERVICES THIS AGREEMENT, made and entered into on this day of , 2016, by and between the City of Yakima, Washington, a municipal corporation with its principal office at 129 North Second Street, Yakima, WA 98901, hereinafter referred to as "CITY ", and Widener and Associates with its principal office at 10108 32nd Avenue W, Suite D, hereinafter referred to as "ENGINEER ", said corporation and its principal engineers are licensed and registered to do business in the State of Washington, and will provide environmental services, including wetland delineation under this Agreement for the Spring Creek Road and soccer complex projects on behalf of the City of Yakima, Project No 2428, herein referred to as the "PROJECT " WITNESSETH: REC ITALS WHEREAS, CITY desires to retain the ENGINEER to provide engineering services for design and construction of the PROJECT, as described in this Agreement and subsequent Amendments thereto, and WHEREAS, ENGINEER represents that it has available and offers to provide personnel with knowledge and experience necessary to satisfactorily accomplish the work within the required time and that it has no conflicts of interest prohibited by law from entering into this Agreement; NOW, THEREFORE, CITY and ENGINEER agree as follows SECTION 1 INCORPORATION OF RECITALS 1 1 The above recitals are incorporated into these operative provisions of the Agreement. SECTION 2 SCOPE OF SERVICES 2 0 1 ENGINEER agrees to perform those services described hereafter Unless modified in writing by both parties, duties of ENGINEER shall not be construed to exceed those services specifically set forth herein 2 0 2 ENGINEER shall use its best efforts to maintain continuity in personnel and shall assign, Ross Widener, as Principal -in- Charge throughout the term of this Agreement unless other personnel are approved by the CITY 2 1 Basic Services ENGINEER agrees to perform those tasks described in Exhibit A, entitled "Spring Creek Road and Soccer Complex Wetland Delineation" (WORK) which is attached hereto and made a part of this Agreement as if fully set forth herein 2.2 Additional Services. CITY and ENGINEER agree that not all WORK to be performed by ENGINEER can be defined in detail at the time this Agreement is executed, and that additional WORK related to the Project and not covered in Exhibit A may be needed during performance of this Agreement. CITY may, at any time, by written order, direct the ENGINEER to revise portions of the PROJECT WORK previously completed in a satisfactory manner, delete portions of the PROJECT, or request that the ENGINEER perform additional WORK beyond the scope of the PROJECT WORK. Such changes hereinafter shall be referred to as "Additional Services " 2 2 1 If such Additional Services cause an increase or decrease in the ENGINEER'S cost of, or time required for, performance of any services under this Agreement, a contract price Page 1 and/or completion time adjustment pursuant to this Agreement shall be made and this Agreement shall be modified in writing accordingly 2 2 2 Compensation for each such request for Additional Services shall be negotiated by the CITY and the ENGINEER according to the hourly rates set forth in Exhibit C, attached hereto and incorporated herein by this reference, and if so authorized, shall be considered part of the PROJECT WORK. The ENGINEER shall not perform any Additional Services until so authorized by CITY and agreed to by the ENGINEER in writing 2 3 The ENGINEER must assert any claim for adjustment in writing within thirty (30) days from the date of the ENGINEER's receipt of the written notification of change. SECTION 3 CITY'S RESPONSIBILITIES 3 1 CITY - FURNISHED DATA. The CITY will provide to the ENGINEER all technical data in the CITY'S possession relating to the ENGINEER'S services on the PROJECT including information on any pre- existing conditions known to the CITY that constitute hazardous waste contamination on the PROJECT site as determined by an authorized regulatory agency 3 2 ACCESS TO FACILITIES AND PROPERTY The CITY will make its facilities reasonably accessible to ENGINEER as required for ENGINEER'S performance of its services and will provide labor and safety equipment as reasonably required by ENGINEER for such access 3 3 TIMELY REVIEW The CITY will examine the ENGINEER'S studies, reports, sketches, drawings, specifications, proposals, and other documents, obtain advice of an attorney insurance counselor, accountant, auditor, bond and financial advisors, and other consultants as CITY deems appropriate, and render in writing decisions required of CITY in a timely manner Such examinations and decisions. however, shall not relieve the ENGINEER of any contractual obligations nor of its duty to render professional services meeting the standards of care for its profession 3 4 CITY shall appoint a CITY'S Representative with respect to WORK to be performed under this Agreement. CITY'S Representative shall have complete authority to transmit instructions and receive information ENGINEER shall be entitled to reasonably rely on such instructions made by the CITY'S Representative unless otherwise directed in writing by the CITY, but ENGINEER shall be responsible for bringing to the attention of the CITY'S Representative any instructions which the ENGINEER believes are inadequate, incomplete, or inaccurate based upon the ENGINEER'S knowledge 3 5 Any documents, services, and reports provided by the CITY to the ENGINEER are available solely as additional information to the ENGINEER and will not relieve the ENGINEER of its duties and obligations under this Agreement or at law The ENGINEER shall be entitled to reasonably rely upon the accuracy and the completeness of such documents, services and reports, but shall be responsible for exercising customary professional care in using and reviewing such documents, services, and reports and drawing conclusions there from SECTION 4 AUTHORIZATION, PROGRESS, AND COMPLETION 4 1 In signing this Agreement, CITY grants ENGINEER specific authorization to proceed with WORK described in Exhibit A. The time for completion is defined in Exhibit A, or as amended SECTION 5 COMPENSATION 5 1 COMPENSATION ON A TIME SPENT BASIS AT SPECIFIC HOURLY RATES For the services described in Exhibit A, compensation shall be according to Exhibit C - Schedule of Specific Hourly Rates, attached hereto and incorporated herein by this reference The estimated cost to perform this work, on a time spent basis, plus reimbursement for direct non - salary expenses is as shown in Exhibit B 51 1 DIRECT NON - SALARY EXPENSES Direct Non - Salary Expenses are those costs incurred on or directly for the PROJECT including but not limited to, necessary Page 2 transportation costs, including current rates for ENGINEER'S vehicles, meals and lodging, laboratory tests and analyses, printing, binding and reproduction charges, all costs associated with other outside nonprofessional services and facilities, special CITY - requested and PROJECT - related insurance and performance warranty costs, and other similar costs Reimbursement for Direct Non - Salary Expenses will be on the basis of actual charges plus a reasonable markup, not to exceed ten percent (10 %) and on the basis of current rates when furnished by ENGINEER Estimated Direct Non -Salary Expenses are shown in Exhibit B 51 1 1 Travel costs, including transportation, lodging, subsistence, and incidental expenses incurred by employees of the ENGINEER and each of the Subconsultants in connection with PROJECT WORK, provided, as follows • That a maximum of U S INTERNAL REVENUE SERVICE allowed cents per mile will be paid for the operation, maintenance, and depreciation costs of company or individually owned vehicles for that portion of time they are used for PROJECT WORK. ENGINEER, whenever possible, will use the least expensive form of ground transportation • That reimbursement for meals inclusive of tips shall not exceed a maximum of forty dollars ($40) per day per person This rate may be adjusted on a yearly basis • That accommodation shall be at a reasonably priced hotel /motel. • That air travel shall be by coach class, and shall be used only when absolutely necessary 5 1 2 Telephone charges, computer charges, in -house reproduction charges, first class postage, and FAX charges are not included in the direct expense costs, but are considered included in the Schedule of Specific Hourly Billing Rates. 513 Professional Subconsultants. Professional Subconsultants are those costs for engineering, architecture, geotechnical services and similar professional services approved by the CITY Reimbursement for Professional Subconsultants will be on the basis of actual costs billed plus a reasonable markup, not to exceed ten percent (10 %) for services provided to the CITY through this Agreement. Estimated Subconsultant costs are shown in Exhibit B 5 2 Unless specifically authorized in writing by the CITY, the total budgetary amount for this PROJECT shall not exceed Twenty -Five Thousand Dollars (S25,000). The ENGINEER will make reasonable efforts to complete the WORK within the budget and will keep CITY informed of progress toward that end so that the budget or WORK effort can be adjusted if found necessary The ENGINEER is not obligated to incur costs beyond the indicated budget, as may be adjusted, nor is the CITY obligated to pay the ENGINEER beyond these limits When any budget has been increased, the ENGINEER'S excess costs expended prior to such increase will be allowable to the same extent as if such costs had been incurred after the approved increase, and provided that the City was informed in writing at the time such costs were incurred 5 3 The ENGINEER shall submit to the City's Representative an invoice each month for payment for PROJECT services completed through the accounting cut -off day of the previous month Such invoices shall be for PROJECT services and WORK performed and costs incurred prior to the date of the invoice and not covered by previously submitted invoices The ENGINEER shall submit with each invoice a summary of time expended on the PROJECT for the current billing period, copies of subconsultant invoices, and any other supporting materials determined by the City necessary to substantiate the costs incurred CITY will use its best efforts to pay such invoices within thirty (30) days of receipt and upon approval of the WORK done and amount billed CITY will notify the ENGINEER promptly if any problems are noted with the invoice CITY may question any item in an invoice, noting to ENGINEER the questionable item(s) and withholding payment for such item(s) The ENGINEER may resubmit such item(s) in a subsequent invoice together with additional supporting information required Page 3 5 4 If payment is not made within sixty (60) days following receipt of approved invoices, interest on the unpaid balance shall accrue beginning with the sixty -first (61) day at the rate of 1 0% per month or the maximum interest rate permitted by law, whichever is less, provided, however, that no interest shall accrue pursuant to Chapter 39 76 RCW when before the date of timely payment a notice of dispute is issued in good faith by the CITY to the ENGINEER pursuant to the terms of RCW 39 76 020(4) 5 5 Final payment of any balance due the ENGINEER for PROJECT services will be made within forty - five (45) days after satisfactory completion of the services required by this Agreement as evidenced by written acceptance by CITY and after such audit or verification as CITY may deem necessary and execution and delivery by the ENGINEER of a release of all known payment claims against CITY arising under or by virtue of this Agreement, other than such payment claims, if any, as may be specifically exempted by the ENGINEER from the operation of the release in stated amounts to be set forth therein 5 6 Payment for any PROJECT services and WORK shall not constitute a waiver or release by CITY of any claims, right, or remedy it may have against the ENGINEER under this Agreement or by law, nor shall such payment constitute a waiver, remission, or discharge by CITY of any failure or fault of the ENGINEER to satisfactorily perform the PROJECT WORK as required under this Agreement. SECTION 6 RESPONSIBILITY OF ENGINEER 6 1 The ENGINEER shall be responsible for the professional quality, technical adequacy and accuracy, timely completion, and the coordination of all plans, design, drawings, specifications, reports, and other services furnished by the ENGINEER under this Agreement. The ENGINEER shall, without additional compensation, correct or review any errors, omissions, or other deficiencies in its plans, designs, drawings, specifications, reports, and other services The ENGINEER shall perform its WORK according to generally accepted civil engineering standards of care and consistent with achieving the PROJECT WORK within budget, on time, and in compliance with applicable laws, regulations, and permits 6 2 CITY'S review or approval of, or payment for, any plans, drawings, designs, specifications, reports, and incidental WORK or services furnished hereunder shall not in any way relieve the ENGINEER of responsibility for the technical adequacy, completeness, or accuracy of its WORK and the PROJECT WORK. CITY'S review, approval, or payment for any of the services shall not be construed to operate as a waiver of any rights under this Agreement or at law or any cause of action arising out of the performance of this Agreement. 6 3 In performing WORK and services hereunder, the ENGINEER and its subcontractors, subconsultants, employees, agents, and representatives shall be acting as independent contractors and shall not be deemed or construed to be employees or agents of CITY in any manner whatsoever The ENGINEER shall not hold itself out as, nor claim to be, an officer or employee of CITY by reason hereof and will not make any claim, demand, or application to or for any right or privilege applicable to an officer or employee of CITY The ENGINEER shall be solely responsible for any claims for wages or compensation by ENGINEER employees, agents, and representatives, including subconsultants and subcontractors, and shall save and hold CITY harmless therefrom 6 4 INDEMNIFICATION. (a) ENGINEER agrees to defend, indemnify, and hold harmless the CITY, its elected officials, agents, officers, employees, agents and volunteers (hereinafter "parties protected ") from (1) claims, demands, liens, lawsuits, administrative and other proceedings,(including reasonable costs and attorneys fees) and (2) judgments, awards, losses, liabilities, damages, penalties, fines, costs and expenses of any kind claimed by third parties arising out of, or related to any death, injury, damage or destruction to any person or any property to the extent caused by any negligent act, action, default, error or omission or willful misconduct arising out of the Engineer's performance under this Agreement. In the event that any lien is placed upon the City's property or any of the City's officers, employees or agents as a result of the negligence or willful misconduct of the Engineer, the Engineer shall at once cause the same to be dissolved and discharged by giving bond or otherwise Page 4 (b) CITY agrees to indemnify and hold the ENGINEER harmless from loss, cost, or expense of any kind claimed by third parties, including without limitation such loss, cost, or expense resulting from injuries to persons or damages to property, caused solely by the negligence or willful misconduct of the CITY, its employees, or agents in connection with the PROJECT (c) If the negligence or willful misconduct of both the ENGINEER and the CITY (or a person identified above for whom each is liable) is a cause of such third party claim, the loss, cost, or expense shall be shared between the ENGINEER and the CITY in proportion to their relative degrees of negligence or willful misconduct and the right of indemnity will apply for such proportion (d) Nothing contained in this Section or this Agreement shall be construed to create a liability or a right of indemnification in any third party 6 5 In any and all claims by an employee of the ENGINEER, any subcontractor, anyone directly or indirectly employed by any of them, or anyone for whose acts any of them may be liable, the indemnification obligations under this Agreement shall not be limited in any way by any limitation on the amount or types of damages, compensation, or benefits payable by or for the ENGINEER or a subcontractor under workers' or workmens' compensation acts, disability benefit acts, or other employee benefit acts. The ENGINEER specifically and expressly waives its immunity under the Industrial Insurance Act, Title 51, RCW Such waiver has been mutually negotiated by the ENGINEER and the CITY 6.6 It is understood that any resident engineering or inspection provided by ENGINEER is for the purpose of determining compliance with the technical provisions of PROJECT specifications and does not constitute any form of guarantee or insurance with respect to the performance of a contractor ENGINEER does not assume responsibility for methods or appliances used by a contractor, for a contractor's safety programs or methods, or for compliance by contractors with laws and regulations CITY shall use its best efforts to ensure that the construction contract requires that the contractor(s) indemnify and name CITY, the CITY'S and the ENGINEER'S officers, principals, employees, agents, representatives, and engineers as additional insureds on contractor's insurance policies covering PROJECT, exclusive of insurance for ENGINEER professional liability 6 7 SUBSURFACE INVESTIGATIONS In soils foundation, groundwater and other subsurface investigations, the actual characteristics may vary significantly between successive test points and sample intervals and at locations other than where observation, exploration, and investigations have been made Because of the inherent uncertainties in subsurface evaluations, changed or unanticipated underground conditions may occur that could affect total PROJECT cost and/or execution These conditions and cost/execution effects are not the responsibility of the ENGINEER, to the extent that ENGINEER has exercised the applicable and appropriate standard of professional care and judgment in such investigations SECTION 7 PROJECT SCHEDULE AND BUDGET 7 1 The general PROJECT schedule and the budget for both the entire PROJECT and its component tasks shall be as set forth in this Agreement and attachments The project schedule and performance dates for the individual tasks shall be mutually agreed to by the CITY and the ENGINEER within fifteen (15) days after execution of this Agreement. The performance dates and budgets for tasks may be modified only upon written agreement of the parties hereto The performance date for tasks and the completion date for the entire PROJECT shall not be extended, nor the budget increased because of any unwarranted delays attributable to the ENGINEER, but may be extended or increased by the CITY in the event of a delay caused by special services requested by the CITY or because of unavoidable delay caused by any governmental action or other conditions beyond the control of the ENGINEER which could not be reasonably anticipated 7.2 Not later than the tenth (10) day of each calendar month during the performance of the PROJECT, the ENGINEER shall submit to the CITY'S Representative a copy of the current schedule and a written narrative description of the WORK accomplished by the ENGINEER and subconsultants on Page 5 each task, indicating a good faith estimate of the percentage completion thereof on the last day of the previous month Additional oral or written reports shall be prepared at the request of the CITY for presentation to other governmental agencies and/or to the public. SECTION 8 REUSE OF DOCUMENTS 8 1 All internal WORK products of the ENGINEER are instruments or service of this PROJECT There shall be no reuse, change, or alteration by the CITY or others acting through or on behalf of the CITY without written permission of the ENGINEER, which shall not be unreasonably withheld and will be at the CITY's sole risk. The CITY agrees to indemnify the ENGINEER and its officers, employees, subcontractors, and affiliated corporations from all claims, damages, losses, and costs including, but not limited to, litigation expenses and attorney's fees arising out of or related to such unauthorized reuse, change, or alteration, provided, however, that the ENGINEER will not be indemnified for such claims, damages, losses, and costs including, without limitation, litigation expenses and attorney fees were caused by the ENGINEER's own negligent acts or omissions 8 2 The ENGINEER agrees that ownership of any plans, drawings, designs, specifications, computer programs, technical reports, operating manuals, calculations, notes, and other WORK submitted or which are specified to be delivered under this Agreement or which are developed or produced and paid for under this Agreement, whether or not complete, shall be vested in the CITY 8 3 All rights to patents, trademarks, copyrights, and trade secrets owned by ENGINEER (hereinafter "Intellectual Property") as well as any modifications, updates or enhancements to said Intellectual Property during the performance of the WORK remain the property of ENGINEER, and ENGINEER does not grant CITY any right or license to such Intellectual Property SECTION 9 AUDIT AND ACCESS TO RECORDS 9 1 The ENGINEER, including its subconsultants, shall maintain books, records, documents and other evidence directly pertinent to performance of the WORK under this Agreement in accordance with generally accepted accounting principles and practices consistently applied The CITY, or the CITY'S duly authorized representative, shall have access to such books, records, documents, and other evidence for inspection, audit, and copying for a period of three years after completion of the PROJECT The CITY shall also have access to such books, records, and documents during the performance of the PROJECT WORK, if deemed necessary by the CITY, to verify the ENGINEER'S WORK and invoices 9 2 Audits conducted pursuant to this section shall be in accordance with generally accepted auditing standards and established procedures and guidelines of the reviewing or auditing agency 9 3 The ENGINEER agrees to the disclosure of all information and reports resulting from access to records pursuant to this section provided that the ENGINEER is afforded the opportunity for an audit exit conference and an opportunity to comment and submit any supporting documentation on the pertinent portions of the draft audit report and that the final audit report will include written comments, if any, of the ENGINEER. 9 4 The ENGINEER shall ensure that the foregoing paragraphs are included in each subcontract for WORK on the Project. 9 5 Any charges of the ENGINEER paid by the CITY which are found by an audit to be inadequately substantiated shall be reimbursed to the CITY SECTION 10 INSURANCE 10 1 At all times during performance of the Services, ENGINEER shall secure and maintain in effect insurance to protect the City and the ENGINEER from and against all claims, damages. losses, and expenses arising out of or resulting from the performance of this Contract. ENGINEER shall provide and maintain in force insurance in limits no less than that stated below, as applicable The City reserves the rights to require higher limits should it deem it necessary in the best interest of the public. Page 6 10 1 1 Commercial General Liability Insurance. Before this Contract is fully executed by the parties, ENGINEER shall provide the City with a certificate of insurance as proof of commercial liability insurance and commercial umbrella liability insurance with a total liability limit of the limits required in the policy, subject to minimum limits of Two Million Dollars ($2,000,000 00) per occurrence combined single limit bodily injury and property damage, and Two Million Dollars ($2,000,000.00) general aggregate The certificate shall clearly state who the provider is, the coverage amount, the policy number, and when the policy and provisions provided are in effect. Said policy shall be in effect for the duration of this Contract. The policy shall name the City, its elected officials, officers, agents, employees, and volunteers as additional insureds The insured shall not cancel or change the insurance without first giving the City thirty (30) calendar days prior written notice The insurance shall be with an insurance company or companies rated A -VII or higher in Best's Guide and admitted in the State of Washington 10 1 2 Commercial Automobile Liability Insurance. a. If ENGINEER owns any vehicles, before this Contract is fully executed by the parties, ENGINEER shall provide the City with a certificate of insurance as proof of commercial automobile liability insurance and commercial umbrella liability insurance with a total liability limit of the limits required in the policy, subject to minimum limits of Two Million Dollars ($2,000,000 00) per occurrence combined single limit bodily injury and property damage Automobile liability will apply to "Any Auto" and be shown on the certificate b If ENGINEER does not own any vehicles, only "Non -owned and Hired Automobile Liability" will be required and may be added to the commercial liability coverage at the same limits as required in that section of this Contract, which is Section 10 1 1 entitled "Commercial General Liability Insurance ". c Under either situation described above in Section 10 1 2 a and Section 10 1.2 b , the required certificate of insurance shall clearly state who the provider is, the coverage amount, the policy number, and when the policy and provisions provided are in effect. Said policy shall be in effect for the duration of this Contract. The policy shall name the City, its elected officials, officers, agents, employees, and volunteers as additional insureds The insured shall not cancel or change the insurance without first giving the City thirty (30) calendar days prior written notice The insurance shall be with an insurance company or companies rated A -VII or higher in Best's Guide and admitted in the State of Washington 10 1 3 Statutory workers' compensation and employer's liability insurance as required by state law 10 1 4 Professional Liability Coverage. Before this Contract is fully executed by the parties, ENGINEER shall provide the City with a certificate of insurance as proof of professional liability coverage with a total liability limit of the limits required in the policy, subject to minimum limits of Two Million Dollars ($2,000,000 00) per claim, and Two Million Dollars ($2,000,000 00) aggregate The certificate shall clearly state who the provider is, the coverage amount, the policy number, and when the policy and provisions provided are in effect. Said policy shall be in effect for the duration of this Contract. The insured shall not cancel or change the insurance without first giving the City thirty (30) calendar days prior written notice The insurance shall be with an insurance company or companies rated A -VII or higher in Best's Guide If the policy is written on a claims made basis the coverage will continue in force for an additional two years after the completion of this contract. Failure of either or all of the additional insureds to report a claim under such insurance shall not prejudice the rights of the CITY, its officers, employees, agents, and representatives there under The CITY and the CITY'S elected officials, officers, principals, employees, representatives, and agents shall have no obligation for payment of premiums because of being named as additional insureds under such insurance Page 7 None of the policies issued pursuant to the requirements contained herein shall be canceled, allowed to expire, or changed in any manner that affects the rights of the City until thirty (30) days after written notice to the CITY of such intended cancellation, expiration or change. SECTION 11 SUBCONTRACTS 11 1 ENGINEER shall be entitled, to the extent determined appropriate by ENGINEER, to subcontract any portion of the WORK to be performed under this Agreement. 11 2 Any subconsultants or subcontractors to the ENGINEER utilized on this PROJECT, including any substitutions thereof, will be subject to prior approval by CITY, which approval shall not be unreasonably withheld Each subcontract shall be subject to review by the CITY'S Representative, if requested, prior to the subconsultant or subcontractor proceeding with the WORK. Such review shall not constitute an approval as to the legal form or content of such subcontract. The ENGINEER shall be responsible for the architectural and engineering performance, acts, and omissions of all persons and firms performing subcontract WORK. 11 3 CITY does not anticipate ENGINEER subcontracting with any additional persons or firms for the purpose of completing this Agreement. 11 4 The ENGINEER shall submit, along with its monthly invoices, a description of all WORK completed by subconsultants and subcontractors during the preceding month and copies of all invoices thereto SECTION 12 ASSIGNMENT 12 1 This Agreement is binding on the heirs, successors and assigns of the parties hereto This Agreement may not be assigned by CITY or ENGINEER without prior written consent of the other, which consent will not be unreasonably withheld It is expressly intended and agreed that no third party beneficiaries are created by this Agreement, and that the rights and remedies provided herein shall inure only to the benefit of the parties to this Agreement. SECTION 13 INTEGRATION 13 1 This Agreement represents the entire understanding of CITY and ENGINEER as to those matters contained herein No prior oral or written understanding shall be of any force or effect with respect to those matters covered herein This Agreement may not be modified or altered except in writing signed by both parties. SECTION 14 JURISDICTION AND VENUE 14 1 This Agreement shall be administered and interpreted under the laws of the State of Washington. Jurisdiction of litigation arising from this Agreement shall be in Washington State If any part of this Agreement is found to conflict with applicable laws, such part shall be inoperative, null, and void insofar as it conflicts with said laws, but the remainder of this Agreement shall be in full force and effect. Venue of all disputes arising under this Agreement shall be Yakima County, State of Washington SECTION 15 EQUAL EMPLOYMENT and NONDISCRIMINATION 15 1 During the performance of this Agreement, ENGINEER and ENGINEER's subconsultants and subcontractors shall not discriminate in violation of any applicable federal, state and /or local law or regulation on the basis of age, sex, race, creed, religion, color, national origin, marital status, disability, honorably discharged veteran or military status, pregnancy sexual orientation, and any other classification protected under federal, state, or local law This provision shall include but not be limited to the following employment, upgrading, demotion, transfer, recruitment, advertising, layoff or termination, rates of pay or other forms of compensation, selection for training, and the provision of services under this Agreement. ENGINEER agrees to comply with the applicable provisions of State and Federal Equal Employment Opportunity and Nondiscrimination statutes and regulations Page 8 SECTION 16 SUSPENSION OF WORK 16 1 CITY may suspend, in writing by certified mail, all or a portion of the WORK under this Agreement if unforeseen circumstances beyond CITY'S control are interfering with normal progress of the WORK. ENGINEER may suspend, in writing by certified mail, all or a portion of the WORK under this Agreement if unforeseen circumstances beyond ENGINEER's control are interfering with normal progress of the WORK. ENGINEER may suspend WORK on PROJECT in the event CITY does not pay invoices when due, except where otherwise provided by this Agreement. The time for completion of the WORK shall be extended by the number of days WORK is suspended If the period of suspension exceeds ninety (90) days, the terms of this Agreement are subject to renegotiation, and both parties are granted the option to terminate WORK on the suspended portion of Project in accordance with SECTION 17 SECTION 17 TERMINATION OF WORK 17 1 Either party may terminate this Agreement, in whole or in part, if the other party materially breaches its obligations under this Agreement and is in default through no fault of the terminating party However, no such termination may be effected unless the other party is given (1) not less than fifteen (15) calendar days written notice delivered by certified mail, return receipt requested, of intent to terminate, and (2) an opportunity for consultation and for cure with the terminating party before termination Notice shall be considered issued within seventy -two (72) hours of mailing by certified mail to the place of business of either party as set forth in this Agreement. 17 2 In addition to termination under subsection 17 1 of this Section, CITY may terminate this Agreement for its convenience, in whole or in part, provided the ENGINEER is given (1) not less than fifteen (15) calendar days written notice delivered by certified mail, return receipt requested, of intent to terminate, and (2) an opportunity for consultation with CITY before termination 17 3 If CITY terminates for default on the part of the ENGINEER, an adjustment in the contract price pursuant to the Agreement shall be made, but (1) no amount shall be allowed for anticipated profit on unperformed services or other WORK, and (2) any payment due to the ENGINEER at the time of termination may be adjusted to the extent of any additional costs or damages CITY has incurred, or is likely to incur, because of the ENGINEER'S breach. In such event, CITY shall consider the amount of WORK originally required which was satisfactorily completed to date of termination, whether that WORK is in a form or of a type which is usable and suitable to CITY at the date of termination and the cost to CITY of completing the WORK itself or of employing another firm to complete it. Under no circumstances shall payments made under this provision exceed the contract price In the event of default, the ENGINEER agrees to pay CITY for any and all damages, costs, and expenses whether directly, indirectly, or consequentially caused by said default. This provision shall not preclude CITY from filing claims and/or commencing litigation to secure compensation for damages incurred beyond that covered by contract retainage or other withheld payments 17 4 If the ENGINEER terminates for default on the part of CITY or if CITY terminates for convenience, the adjustment pursuant to the Agreement shall include payment for services satisfactorily performed to the date of termination, in addition to termination settlement costs the ENGINEER reasonably incurs relating to commitments which had become firm before the termination, unless CITY determines to assume said commitments 17 5 Upon receipt of a termination notice under subsections 17 1 or 17 2 above, the ENGINEER shall (1) promptly discontinue all services affected (unless the notice directs otherwise), and (2) deliver or otherwise make available to CITY all originals of data, drawings, specifications, calculations, reports, estimates, summaries, and such other information, documents, and materials as the ENGINEER or its subconsultants may have accumulated or prepared in performing this Agreement, whether completed or in progress, with the ENGINEER retaining copies of the same 17 6 Upon termination under any subparagraph above, CITY reserves the right to prosecute the WORK to completion utilizing other qualified firms or individuals, provided, the ENGINEER shall have no responsibility to prosecute further WORK thereon Page 9 17 7 If, after termination for failure of the ENGINEER to fulfill contractual obligations, it is determined that the ENGINEER has not so failed, the termination shall be deemed to have been effected for the convenience of CITY In such event, the adjustment pursuant to the Agreement shall be determined as set forth in subparagraph 17 4 of this Section 17 8 If, because of death, unavailability or any other occurrence, it becomes impossible for any key personnel employed by the ENGINEER in PROJECT WORK or for any corporate officer of the ENGINEER to render his services to the PROJECT, the ENGINEER shall not be relieved of its obligations to complete performance under this Agreement without the concurrence and written approval of CITY If CITY agrees to termination of this Agreement under this provision, payment shall be made as set forth in subparagraph 17 3 of this Section SECTION 18 DISPUTE RESOLUTION 18 1 In the event that any dispute shall arise as to the interpretation of this agreement, or in the event of a notice of default as to whether such default does constitute a breach of the contract, and if the parties hereto cannot mutually settle such differences, then the parties shall first pursue mediation as a means to resolve the dispute If either of the afore mentioned methods are not successful then any dispute relating to this Agreement shall be decided in the courts of Yakima County, in accordance with the laws of Washington If both parties consent in writing, other available means of dispute resolution may be implemented Page 10 SECTION 19 NOTICE 19 1 Any notice required to be given under the terms of this Agreement shall be directed to the party at the address set forth below Notice shall be considered issued and effective upon receipt thereof by the addressee -party, or seventy -two (72) hours after mailing by certified mail to the place of business set forth below, whichever is earlier CITY City of Yakima 129 N Second Street Yakima, WA 98901 Attn Brett Sheffield ENGINEER. Widener & Associates 10108 32"° Avenue W , Ste D Everett, WA 98204 Attn Ross Widener IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed by their respective authorized officers or representatives as of the day and year first above written CITY OF YAKIMA Y - / / ,C : 144� 4./ Jeff Cutter" p gn ture Printed Name r T �� t.R-� Printed Name FOSS 6 6. 11/41 0 C - Title Interim City Manager Title V Date ( e)o . t 0 DO � .> ��ate �-16 I 6. Nn Attest `I d " J J ' (r � 4 1' - , ` • � I . ity Cler r ! ~ r ! (.."c • I..>, City Contract No 2016 - OHO r , ' • ' Resolution No R- 2.016T 0 �,' `� ! - '' ' Page 11 STATE OF WASHINGTON ) ss COUNTY OF YAKIMA ) I certify that I know or have satisfactory evidence that jet Col-kg- is the person who appeared before me, and said person acknowledged that he signed this instrument, on oath stated that he was authorized to execute the instrument, and acknowledged it as the CITY MANAGER of the CITY OF YAKIMA, to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. n Dated I (� C 1 Ate, ) ' ZO 1 (o Seal or Stamp J 4 (Signature) T State of Washington Piggy ' `� cd S Q t7 l't/i / V 0 �t4 i G Title Notary Public JJJ My Commission � July 9, 2017 I c rY? i) r2 01 M bk/ Printed Name- "` My commission expires' l'-' - 2017 Page 12 STATE OF WASHINGTON ss. COUNTY OF YAKIMA I certify that I know or have satisfactory evidence that P ss L. INI ile , is the person who appeared before me, and said person acknowledged that he /she signed this instrument, on oath stated that he /she was authorized to execute the instrument, and acknowledged it as the of to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. Dated Z. — Li Seal or Stamp I (Signature) Notary Public State of Washingt ®n Title s GRANT T HOOFER o Pt'�. MY COMMISSION EXPIR €l7 ep R ®■@ffiner 1312010 • Printed Name My commission expires g Page 13 EXHIBIT A SPRING CREEK ROAD AND SOCCER COMPLEX WETLAND DELINEATION SCOPE OF WORK Wetland Delineation The purpose of the wetland report is to identify jurisdictional wetland within the project corridors of the proposed site in proximity to the Yakima Airport. The Consultant shall develop, implement, and complete field surveys to identify and delineate wetlands in the project area using the appropriate methods described in the Corps of Engineers Wetlands Delineation Manual (Environmental Laboratory 1987), Wetlands Research, Technical Report Y -87 -1, January 1987. The Consultant shall delineate wetlands within the project area. The Consultant shall prepare a comprehensive report that includes detailed wetland maps, documentation of survey methods, results, potential impacts from project actions, and recommendations for wetland protection and mitigation The report also shall contain appropriate forms for wetland identification, delineation and function assessment required by the Army Corps of Engineers (USACE). The information in this report is intended for use in compliance with Section 404 of the Clean Water Act. The final report and associated documents shall be in a format acceptable to the USACE. Delineated wetland boundaries shall be identified on the ground with flagging. The delineated wetland boundaries shall be mapped with accuracy acceptable to the USACE. Deliverable L Electronic copy of a draft Wetland Delineation Report for review by City with accompanying draft special provisions if required. 2. Electronic copy of a draft Wetland Delineation Report, incorporating the City's comments, for submittal to USACE. 3. Electronic copy of a revised draft Wetland Delineation Report, incorporating comments by USACE, for submittal for approval. - 'i'-,.:ii':'.. ,-.i---: icf.: in :'4.:',--, .. t - *- 4, "V , I,A", - -, t.W;h7; 475 .4,-*- ''. '• " ''.%Vk A:r0i' ''''';''''''''''' '''''' p i 'll.. $ 1 , V4I: ' 17: - .. ' -.4Ait; ' 7/ . .ic l i.- - ': - Ir1;.:` ''''"..:4-,,;;At'' :„f4W.. '-k4 --, - r , i ' ;''''."-lilt cl-= t 6q-,-c-c'4:;,'- k -,' ---1 ,0 4.e.'"'--:V'. ,,=$•• Cg Prole • Name. t? ' •-> - =-1 1 • ttel Wetlbnd:Del neatkarC 't..tt - t; - ? - '-''''..'4 w re' K t i k .. r•:42 zt,„....i. ,- . 40-..,,e 2 ,,,„ 4 1. ;;, - t . --,,., T , F . , .. ..t;. - ?:;.,'..,r,r',". ''''' ',. 1 Ghent , f;' - tt', .:, - ••. - .4 „:4 k'-.= . '' - i- ,4, ,: t ;::` - ...'3-' 6 ,......L . 'It..: 1 2&.;1: '" ..4., ; :e.-'.. :: -.f!',.:L".Vi 1. 1K.... 57 .- ' k:i.. ', ';'2,9'....1 . ' - '.... ' ;+ ' .. ,‘ :. ' ''' '' .:211 7 :' ,- : 2 ' ' .i ' :; - ' : -.:C.ii_ '' . ': -.: ;-.'' ',;!,..4 t" .: • : ' ' 4 4 1,1greVi, C ' ...—s..1'' 't g r faekilli t 6 3 • ....,', - tlaa.:4_........, ' -,... 4 Project Project Manager Biologist 1 i Field Work 161 80 I I I I Draft Report , 80 Final Report 4 12 Agency Coordination 16 24 I Totals 40 196 Summary Hours Rate Cost Project Manager 40 S154 001 6,160.00 Project Biologist 196 $86.80 $17.012.80 TOTAL ESTIMATED COST I S23.172.80 , EXHIBIT "C" SCHEDULE OF RATES Position Hourly Rate Project Manager $154 00 Project Biologist 86 80 Page 16